Document:

Exhibit 4.4

 Exhibit 4.4 
  

  
 INDENTURE 
  
 among 
  
 SLM STUDENT LOAN TRUST 2005-5, 
 as the Issuer, 
  
 CHASE BANK USA, NATIONAL ASSOCIATION, 
 not in its individual capacity but 
 solely as the Eligible Lender Trustee 
  
 and 
  
 DEUTSCHE BANK TRUST COMPANY AMERICAS, 
 not in its individual capacity but 
 solely as the Indenture Trustee 
  
 Dated as of June 1, 2005 
  

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page

	 	  	ARTICLE I	  	 
	 	  	Definitions and Usage	  	 
			
	SECTION 1.1	  	Definitions and Usage	  	2
	SECTION 1.2	  	Incorporation by Reference of Trust Indenture Act	  	2
			
	 	  	ARTICLE II	  	 
	 	  	The Notes	  	 
			
	SECTION 2.1	  	Form	  	3
	SECTION 2.2	  	Execution, Authentication and Delivery	  	3
	SECTION 2.3	  	Temporary Notes	  	4
	SECTION 2.4	  	Registration; Registration of Transfer and Exchange	  	4
	SECTION 2.5	  	Mutilated, Destroyed, Lost or Stolen Notes	  	6
	SECTION 2.6	  	Persons Deemed Owner	  	7
	SECTION 2.7	  	Payment of Principal and Interest; Note Interest Shortfall	  	7
	SECTION 2.8	  	Cancellation	  	8
	SECTION 2.9	  	Release of Collateral	  	8
	SECTION 2.10	  	Book-Entry Notes	  	8
	SECTION 2.11	  	Notices to Clearing Agency	  	9
	SECTION 2.12	  	Definitive Notes	  	9
			
	 	  	ARTICLE III	  	 
	 	  	Covenants	  	 
			
	SECTION 3.1	  	Payments to Noteholders and each Swap Counterparty	  	10
	SECTION 3.1A	  	Collateral Account	  	10
	SECTION 3.2	  	Maintenance of Office or Agency	  	11
	SECTION 3.3	  	Money for Payments to be Held in Trust	  	11
	SECTION 3.4	  	Existence	  	13
	SECTION 3.5	  	Protection of Indenture Trust Estate	  	13
	SECTION 3.6	  	Opinions as to Indenture Trust Estate	  	13
	SECTION 3.7	  	Performance of Obligations; Servicing of Trust Student Loans	  	14
	SECTION 3.8	  	Negative Covenants	  	16
	SECTION 3.10	  	Annual Statement as to Compliance	  	17
	SECTION 3.11	  	Issuer May Consolidate, etc., Only on Certain Terms.	  	17
	SECTION 3.12	  	Successor or Transferee	  	19
	SECTION 3.13	  	No Other Business	  	19
	SECTION 3.14	  	No Borrowing	  	19
	SECTION 3.15	  	Obligations of Servicer and Administrator	  	19
	SECTION 3.16	  	Guarantees, Loans, Advances and Other Liabilities	  	19
	SECTION 3.17	  	Capital Expenditures	  	19
	SECTION 3.18	  	Restricted Payments	  	20

  

 i 

					
	SECTION 3.19	  	Notice of Events of Default	  	20
	SECTION 3.20	  	Further Instruments and Acts	  	20
			
	 	  	ARTICLE IV	  	 
	 	  	Satisfaction and Discharge	  	 
			
	SECTION 4.1	  	Satisfaction and Discharge of Indenture	  	20
	SECTION 4.2	  	Application of Trust Money	  	21
	SECTION 4.3	  	Repayment of Moneys Held by Paying Agent	  	22
	SECTION 4.4	  	Auction of Trust Student Loans	  	22
			
	 	  	ARTICLE V	  	 
	 	  	Remedies	  	 
			
	SECTION 5.1	  	Events of Default	  	23
	SECTION 5.2	  	Acceleration of Maturity; Rescission and Annulment	  	24
	SECTION 5.3	  	Collection of Indebtedness and Suits for Enforcement by Indenture Trustee	  	24
	SECTION 5.4	  	Remedies; Priorities	  	26
	SECTION 5.5	  	Optional Preservation of the Trust Student Loans	  	30
	SECTION 5.6	  	Limitation of Suits	  	30
	SECTION 5.7	  	Unconditional Rights of Noteholders to Receive Principal and Interest	  	31
	SECTION 5.8	  	Restoration of Rights and Remedies	  	31
	SECTION 5.9	  	Rights and Remedies Cumulative	  	31
	SECTION 5.10	  	Delay or Omission Not a Waiver	  	31
	SECTION 5.11	  	Control by Noteholders	  	31
	SECTION 5.12	  	Waiver of Past Defaults	  	32
	SECTION 5.13	  	Undertaking for Costs	  	32
	SECTION 5.14	  	Waiver of Stay or Extension Laws	  	32
	SECTION 5.15	  	Action on Notes	  	33
	SECTION 5.16	  	Performance and Enforcement of Certain Obligations.	  	33
			
	 	  	ARTICLE VI	  	 
	 	  	The Indenture Trustee	  	 
			
	SECTION 6.1	  	Duties of Indenture Trustee	  	34
	SECTION 6.2	  	Rights of Indenture Trustee	  	35
	SECTION 6.3	  	Individual Rights of Indenture Trustee	  	35
	SECTION 6.4	  	Indenture Trustee’s Disclaimer	  	35
	SECTION 6.5	  	Notice of Defaults	  	36
	SECTION 6.6	  	Reports by Indenture Trustee to Noteholders	  	36
	SECTION 6.7	  	Compensation and Indemnity	  	36
	SECTION 6.8	  	Replacement of Indenture Trustee	  	37
	SECTION 6.9	  	Successor Indenture Trustee by Merger	  	38
	SECTION 6.10	  	Appointment of Co-Trustee or Separate Trustee.	  	38
	SECTION 6.11	  	Eligibility; Disqualification	  	39
	SECTION 6.12	  	Preferential Collection of Claims Against the Issuer	  	39

  

 ii 

					
	 	  	ARTICLE VII	  	 
	 	  	Noteholders’ Lists and Reports	  	 
			
	SECTION 7.1	  	Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders	  	40
	SECTION 7.2	  	Preservation of Information; Communications to Noteholders	  	40
	SECTION 7.3	  	Reports by Issuer.	  	41
			
	 	  	ARTICLE VIII	  	 
	 	  	Accounts, Disbursements and Releases	  	 
			
	SECTION 8.1	  	Collection of Money	  	41
	SECTION 8.2	  	Trust Accounts	  	41
	SECTION 8.3	  	General Provisions Regarding Accounts	  	42
	SECTION 8.4	  	Release of Indenture Trust Estate	  	43
	SECTION 8.5	  	Opinion of Counsel	  	43
			
	 	  	ARTICLE IX	  	 
	 	  	Supplemental Indentures	  	 
			
	SECTION 9.1	  	Supplemental Indentures Without Consent of Noteholders.	  	44
	SECTION 9.2	  	Supplemental Indentures with Consent of Noteholders.	  	45
	SECTION 9.3	  	Execution of Supplemental Indentures	  	46
	SECTION 9.4	  	Effect of Supplemental Indenture	  	47
	SECTION 9.5	  	Conformity with Trust Indenture Act	  	47
	SECTION 9.6	  	Reference in Notes to Supplemental Indentures	  	47
			
	 	  	ARTICLE X	  	 
	 	  	Redemption of Notes	  	 
			
	SECTION 10.1	  	Redemption	  	47
	SECTION 10.2	  	Form of Redemption Notice	  	47
	SECTION 10.3	  	Notes Payable on Redemption Date	  	48
			
	 	  	ARTICLE XI	  	 
	 	  	Miscellaneous	  	 
			
	SECTION 11.1	  	Compliance Certificates and Opinions, etc	  	48
	SECTION 11.2	  	Form of Documents Delivered to Indenture Trustee	  	50
	SECTION 11.3	  	Acts of Noteholders	  	51
	SECTION 11.4	  	Notices, etc., to Indenture Trustee, Issuer and Rating Agencies	  	51
	SECTION 11.5	  	Notices to Noteholders; Waiver	  	52
	SECTION 11.6	  	Alternate Payment and Notice Provisions	  	52
	SECTION 11.7	  	Conflict with Trust Indenture Act	  	53
	SECTION 11.8	  	Effect of Headings and Table of Contents	  	53
	SECTION 11.9	  	Successors and Assigns	  	53

  

 iii 

					
	SECTION 11.10	  	Separability	  	53
	SECTION 11.11	  	Benefits of Indenture	  	53
	SECTION 11.12	  	Legal Holidays	  	53
	SECTION 11.13	  	Governing Law	  	54
	SECTION 11.14	  	Counterparts	  	54
	SECTION 11.15	  	Recording of Indenture	  	54
	SECTION 11.16	  	Trust Obligations	  	54
	SECTION 11.17	  	No Petition	  	54
	SECTION 11.18	  	Inspection	  	55
	SECTION 11.19	  	Subordination	  	55

  
  

 iv 

 APPENDICES, SCHEDULES AND EXHIBITS 
  

			
	APPENDIX A-1	  	Definitions and Usage
	APPENDIX A-2	  	Reset Rate Note Procedures
		
	SCHEDULE A	  	Schedule of Trust Student Loans
	SCHEDULE B	  	Location of Trust Student Loan Files
		
	EXHIBIT A	  	Forms of Notes
	EXHIBIT B	  	Form of Note Depository Agreement for U.S. Dollar Denominated Notes
	EXHIBIT C	  	Form of Note Depository Agreement for Notes Denominated in a Currency Other than U.S. Dollars

  
  

 v 

 INDENTURE, dated as of June 1, 2005, among SLM STUDENT LOAN TRUST 2005-5, a Delaware statutory trust (the
“Issuer”), CHASE BANK USA, NATIONAL ASSOCIATION, a national banking association, not in its individual capacity but solely as eligible lender trustee on behalf of the Issuer (in such capacity, the “Eligible Lender Trustee”), and
DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation, not in its individual capacity but solely as indenture trustee (in such capacity, the “Indenture Trustee”). 
  
 Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the holders of the
Issuer’s Student Loan-Backed Notes (the “Notes”) and, after the Notes have been paid in full, for the benefit of any Currency Swap Counterparty: 
  

GRANTING CLAUSE 
  
 The Issuer and, with respect to the Trust Student Loans, the Eligible Lender Trustee hereby Grant to the Indenture Trustee, as trustee for the benefit of
the Noteholders and, subject to the provisions of Section 11.19, any Currency Swap Counterparty, effective as of the Closing Date all of their right, title and interest in and to the following: 
  
 (a) the Trust Student Loans, and all obligations of the Obligors thereunder
including all moneys accrued and paid thereunder on or after the applicable Cutoff Date and all guaranties and other rights relating to the Trust Student Loans; 
  

(b) the Servicing Agreement, including the right of the Issuer to cause the Servicer to purchase Trust Student Loans from the Issuer under
circumstances described therein; 
  
 (c) the related Sale
Agreement, including the right of the Issuer to cause the Depositor to repurchase Trust Student Loans from the Issuer under the circumstances described therein and including the rights of the Depositor under the Purchase Agreements; 
  
 (d) the SLM ECFC Purchase Agreement and the VG Funding Purchase Agreement, to
the extent that the rights of the Depositor thereunder have been assigned to the Issuer pursuant to the Sale Agreement, including the right of the Depositor to cause SLM ECFC or VG Funding, as the case may be, to repurchase Trust Student Loans from
the Depositor under the circumstances described in the applicable Purchase Agreement; 
  
 (e) the Administration Agreement, the Remarketing Agreement, any Swap Agreements to be entered into from time to time and any agreement representing Eligible Repurchase Obligations between the Trust and an Eligible
Repo Counterparty to be entered into from time to time; 
  
 (f)
each Guarantee Agreement, including the right of the Issuer to cause the related Guarantor to make Guarantee Payments in respect of the Trust Student Loans; 
  
 (g) the Trust Accounts and all funds on deposit from time to time in the Trust Accounts, including the Reserve Account Initial Deposit, the Capitalized
Interest Account Initial Deposit, the Supplemental Purchase Account Initial Deposit, the Add-On Consolidation Loan Account Initial Deposit and the Collection Account Initial Deposit, if any, and all investments and proceeds thereof (including all
income thereon); and 

  

 1 

 (h) all present and future claims, demands, causes and choses in action in respect of any or all of the
foregoing and all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds of the conversion, voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel paper, checks, general intangibles, deposit accounts, insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations and
receivables, instruments and other property which at any time constitute all or part of or are included in the proceeds of any of the foregoing (collectively, the “Collateral”). 
  
 The foregoing Grant is made in trust to secure the payment of principal of and interest on, and any other amounts owing in
respect of, the Notes, equally and ratably without prejudice, priority or distinction, to secure compliance with the provisions of this Indenture and, subject to the provisions of Section 11.19, to secure amounts owing to any Currency Swap
Counterparty under the related Currency Swap Agreement, all as provided in this Indenture. 
  
 The Indenture Trustee, as indenture trustee on behalf of the Noteholders and each Currency Swap Counterparty, acknowledges such Grant, accepts the trusts under this Indenture in accordance with the provisions of this
Indenture and agrees to perform its duties required in this Indenture to the best of its ability to the end that the interests of the Noteholders and each Currency Swap Counterparty under the related Currency Swap Agreement may be adequately and
effectively protected. 
  
 ARTICLE I 
  
 Definitions and Usage 
  
 SECTION 1.1 Definitions and Usage. Except as otherwise specified
herein or as the context may otherwise require, capitalized terms used but not otherwise defined herein are defined in Appendix A to this Indenture, which also contains rules as to usage that shall be applicable herein. 
  
 SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: 
  
 “Commission” means the Securities and Exchange Commission.

  
 “indenture securities” means the Notes. 

 
 “indenture security holder” means a Noteholder. 
  
 “indenture to be qualified” means this Indenture. 
  

 2 

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

  
 “obligor” on the indenture securities means the
Issuer and any other obligor on the indenture securities. 
  
 All
other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule have the meaning assigned to them by such definitions. 
  
 ARTICLE II  
  
 The Notes 
  
 SECTION 2.1 Form. The Notes, together with the Indenture Trustee’s certificate of authentication, shall be in
substantially the forms set forth in Exhibit A, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may have such letters, numbers or other marks of identification and
such legends or endorsements placed thereon as may, consistently herewith, be determined by the officers executing the Notes, as evidenced by their execution of the Notes. Any portion of the text of any Note may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the Note. 
  
 The Definitive Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods (with or without steel engraved borders), all as determined by the officers executing such Notes, as evidenced by
their execution of such Notes. 
  
 The terms of the Notes set
forth in Exhibit A are part of the terms of this Indenture. 
  
 Each class of Notes will be represented by interests in a book-entry note certificate deposited on the Closing Date with Deutsche Bank Trust Company Americas, as custodian for DTC (the “DTC Custodian”), and registered in the name
of Cede & Co. as initial nominee for DTC. 
  
 SECTION 2.2
Execution, Authentication and Delivery. The Notes shall be executed on behalf of the Issuer by any of its Authorized Officers. The signature of any such Authorized Officer on the Notes may be manual or facsimile. 
  
 Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Issuer shall bind the Issuer, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date
of such Notes. 
  
 The Indenture Trustee shall upon Issuer Order
authenticate and deliver Notes for original issue in an aggregate principal amount of $2,292,623,000. The aggregate principal amount of Notes Outstanding at any time may not exceed such amount except as provided in Section 2.5. On each Spread
Determination Date, upon receipt of an Issuer Order, the Indenture Trustee shall deliver a revised Schedule A for the Reset Rate Notes to the Custodians. 
  

 3 

 Each Note shall be dated the date of its authentication. The Floating Rate Notes shall be issuable as
registered notes in minimum denominations of $100,000 and additional increments of $1,000. 
  
 During any Reset Period when the Reset Rate Notes are denominated in U.S. Dollars, they shall be issued in minimum denominations of $100,000, and additional increments of $1,000. During any Reset Period when the Reset
Rate Notes are denominated in a currency other than U.S. Dollars, they shall be issued in minimum denominations of the applicable currency equivalent (approximately) of $100,000 and additional increments of the applicable currency equivalent of
$1,000 (which shall be determined by reference to the exchange rate to be set forth in the related Currency Swap Agreement); provided, that during any Reset Period when the Reset Rate Notes are denominated in Pounds Sterling, they shall be
issued in minimum denominations of £100,000 and additional increments of £1,000 and provided further, that during any Reset Period when the Reset Rate Notes are denominated in Euros, they shall be issued in minimum
denominations of €100,000 and additional increments of €1,000. 
  
 No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its authorized signatories, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered
hereunder. 
  
 SECTION 2.3 Temporary Notes. Pending the
preparation of Definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture Trustee shall authenticate and deliver, temporary Notes which are printed, lithographed, typewritten, mimeographed or otherwise produced, of
the tenor of the Definitive Notes in lieu of which they are issued and with such variations not inconsistent with the terms of this Indenture determined to be appropriate by the Responsible Officer of the Issuer executing the temporary Notes, as
evidenced by his or her execution of such temporary Notes. 
  
 If
temporary Notes are issued, the Issuer will cause Definitive Notes to be prepared without unreasonable delay. After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary
Notes at the office or agency of the Issuer to be maintained as provided in Section 3.2, without charge to the Noteholder. Upon surrender for cancellation of any one or more temporary Notes, the Issuer shall execute and the Indenture Trustee shall
authenticate and deliver in exchange therefor a like principal amount of Definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as Definitive
Notes. 
  
 SECTION 2.4 Registration; Registration of Transfer
and Exchange. The Issuer shall cause to be kept a register (the “Note Register”) in which, subject to such reasonable regulations as it may prescribe, the Issuer shall provide for the registration of Notes and the registration of
transfers of Notes. The Indenture Trustee shall be “Note Registrar” for the purpose of registering Notes and transfers of Notes as herein provided. Upon any resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note Registrar. 
  
  

 4 

 If a Person other than the Indenture Trustee is appointed by the Issuer as Note Registrar, the Issuer
shall give the Indenture Trustee prompt written notice of the appointment of such Note Registrar and of the location, and any change in the location, of the Note Register, and the Indenture Trustee shall have the right to inspect the Note Register
at all reasonable times and to obtain copies thereof, and the Indenture Trustee shall have the right to rely upon a certificate executed on behalf of the Note Registrar by an Executive Officer thereof as to the names and addresses of the Noteholders
and the principal amounts and number of such Notes. 
  
 Upon
surrender for registration of transfer of any Note at the office or agency of the Issuer to be maintained as provided in Section 3.2 or, with respect to the Reset Rate Notes, to the Note Registrar or any transfer agent, as applicable, if the
requirements of Section 8-401(1) of the UCC are met, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, in the name of the designated transferee or transferees, one or
more new Notes in any authorized denominations and a like aggregate principal amount. 
  
 At the option of the Noteholder, Notes may be exchanged for other Notes in any authorized denominations and a like aggregate principal amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, the Notes which the Noteholder making the exchange is entitled to
receive. 
  
 All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange. 
  
 Every Note presented or surrendered for registration of transfer or exchange
shall be duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by the Noteholder thereof or such Noteholder’s attorney duly authorized in writing, with such signature
guaranteed by an “eligible guarantor institution” meeting the requirements of the Note Registrar, which requirements include membership or participation in Securities Transfer Agent’s Medallion Program (“STAMP”) or such
other “signature guarantee program” as may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Exchange Act. 
  
 No service charge shall be made to a Noteholder for any registration of transfer or exchange of Notes, but the Indenture
Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes, other than exchanges pursuant to Section 2.3 or 9.6 not involving
any transfer. 
  
 The preceding provisions of this Section
notwithstanding, the Issuer shall not be required to make and the Note Registrar need not register transfers or exchanges of Notes selected for redemption or of any Note for a period of 15 days preceding the due date for any payment with respect to
the Note. 
  
  

 5 

 Any transfer or assignment of any Note or any interest in any Note that is not effected pursuant to the
provisions of this Indenture (including, without limitation, this Section 2.4 and Section 2.13), such as a transfer or assignment not reflected on the Note Register, shall be null and void and shall not be taken into account by, or be binding upon,
the Indenture Trustee or any other party. 
  
 SECTION 2.5
Mutilated, Destroyed, Lost or Stolen Notes. If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (ii) there is
delivered to the Issuer and the Indenture Trustee such security or indemnity as may be required by each of them to hold the Issuer and the Indenture Trustee harmless, then, in the absence of notice to the Issuer, the Note Registrar or the Indenture
Trustee that such Note has been acquired by a bona fide purchaser, and provided that the requirements of Section 8-405 of the UCC are met, the Issuer shall execute and upon its request the Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note; provided, however, that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become or within 15 days shall
be due and payable, or shall have been called for redemption, instead of issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so due or payable or upon the Redemption Date without surrender thereof. If, after the
delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding sentence, a bona fide purchaser of the original Note in lieu of which such replacement Note was issued presents for payment
such original Note, the Issuer and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona fide purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Issuer
or the Indenture Trustee in connection therewith. 
  
 Upon the
issuance of any replacement Note under this Section, the Issuer may require the payment by the Noteholder thereof of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable
expenses (including the fees and expenses of the Indenture Trustee) connected therewith. 
  
 Every replacement Note issued pursuant to this Section in replacement of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder. 
  
 The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. 
  

 6 

 SECTION 2.6 Persons Deemed Owner. Prior to due presentment for registration of transfer of any
Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for the purpose of receiving payments
of principal of, interest, if any, on such Note and for all other purposes whatsoever, whether or not such Note be overdue, and neither the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture Trustee shall be affected by
notice to the contrary. 
  
 SECTION 2.7 Payment of Principal
and Interest; Note Interest Shortfall. (a) The Notes shall accrue interest as provided in the forms of Notes in Exhibit A and such interest shall be payable on each applicable Distribution Date as specified therein, subject to Section 3.1. Any
installment of interest or principal, if any, payable on any Note which is punctually paid or duly provided for by the Issuer on the applicable Distribution Date shall be paid to the Person in whose name such Note (or one or more Predecessor Notes)
is registered on the applicable Record Date by check mailed first-class, postage prepaid to such Person’s address as it appears on the Note Register on such Record Date, except that, unless Definitive Notes have been issued pursuant to Section
2.12, with respect to Notes registered on the Record Date in the name of the nominee of the applicable Clearing Agency, for the Notes, payment shall be made by wire transfer in immediately available funds to the account designated by such nominee
and except for the final installment of principal payable with respect to such Note on a Distribution Date or on the Note Final Maturity Date for such Note which shall be payable as provided below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.3. 
  
 (b)
The principal amount of each class of Floating Rate Notes shall be payable in installments on each applicable Distribution Date as provided in the forms of Notes set forth in Exhibit A and the principal amount of the Reset Rate Notes shall be
payable on each applicable Distribution Date as set forth in the form of Notes set forth in Exhibit A and in Appendix A-2. Notwithstanding the foregoing, the entire unpaid principal amount of each class of the Notes shall be due and payable, if not
previously paid, on the Note Final Maturity Date for such class of Notes and on the date on which an Event of Default shall have occurred and be continuing if the Indenture Trustee or the Noteholders of the Notes representing at least a majority of
the Outstanding Amount of the Notes have declared the Notes to be immediately due and payable in the manner provided in Section 5.2. All principal payments on the Notes shall be made pro rata to the specific class of Noteholders entitled thereto.
The Indenture Trustee shall notify the Person in whose name a Note is registered at the close of business on the Record Date preceding the Distribution Date on which the Issuer expects that the final installment of principal of and interest on such
Note will be paid. Such notice shall be mailed or transmitted by facsimile prior to such final Distribution Date and shall specify that such final installment will be payable only upon presentation and surrender of such Note and shall specify the
place where such Note may be presented and surrendered for payment of such installment. Notices in connection with redemptions of Notes shall be mailed to Noteholders as provided in Section 10.2. 
  
 (c) If the Issuer defaults in a payment of interest at the applicable Note
Rate on the Notes, the Issuer shall pay the resulting Note Interest Shortfall on the following Distribution Date as provided in the Administration Agreement. 
  

 7 

 SECTION 2.8 Cancellation. All Notes surrendered for payment, registration of transfer, exchange or
redemption shall, if surrendered to any Person other than the Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee for
cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in any manner whatsoever and all Notes so delivered shall be promptly cancelled by the Indenture Trustee. No Notes shall be authenticated in
lieu of or in exchange for any Notes cancelled as provided in this Section, except as expressly permitted by this Indenture. All canceled Notes may be held or disposed of by the Indenture Trustee in accordance with its standard retention or disposal
policy as in effect at the time, unless the Issuer shall direct by an Issuer Order that they be returned to it and so long as such Issuer Order is timely and the Notes have not been previously disposed of by the Indenture Trustee. 
  
 SECTION 2.9 Release of Collateral. Subject to Sections 11.1 and 11.19
and the terms of the Basic Documents, the Indenture Trustee shall release property from the lien of this Indenture only upon receipt of an Issuer Request accompanied by an Officers’ Certificate of the Issuer, an Opinion of Counsel and
Independent Certificates in accordance with TIA §§ 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates to the effect that the TIA does not require any such Independent Certificates. 
  
 SECTION 2.10 Book-Entry Notes. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to be delivered to The Depository Trust Company, as initial Clearing Agency, by the Issuer, or on behalf of the Issuer. Such Notes shall initially be registered on the
Note Register in the name of Cede & Co., the nominee of The Depository Trust Company, and no Note Owner shall receive a definitive, fully registered note (a “Definitive Note”) representing such Note Owner’s interest in such Note,
except as provided in Section 2.12. Unless and until Definitive Notes have been issued to Note Owners pursuant to Section 2.12: 
  
 (i) the provisions of this Section shall be in full force and effect; 
  
 (ii) the Note Registrar and the Indenture Trustee, and their respective directors, officers, employees and agents, may deal
with the applicable Clearing Agency for all purposes (including the payment of principal of and interest and other amounts on the Notes) as the authorized representative of the Note Owners; 
  
 (iii) to the extent that the provisions of this Section conflict with any
other provisions of this Indenture, the provisions of this Section shall control; 
  
 (iv) the rights of Note Owners shall be exercised only through the applicable Clearing Agency and shall be limited to those established by law and agreements between such Note Owners and the applicable Clearing Agency
and/or the applicable Clearing Agency Participants pursuant to the Note Depository Agreement; and unless and until Definitive Notes are issued pursuant to Section 2.12, the initial Clearing Agency will make book-entry transfers among the applicable
Clearing Agency Participants and receive and transmit payments of principal of and interest and other amounts on the Notes to such applicable Clearing Agency Participants; 
  

 8 

 (v) whenever this Indenture requires or permits actions to be taken based upon instructions or directions
of Noteholders of Notes evidencing a specified percentage of the Outstanding Amount of the Notes, the applicable Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from
Note Owners and/or applicable Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee; and 
  
 (vi) upon acquisition or transfer of a beneficial interest in any Book-Entry
Note by, for or with the assets of, a Benefit Plan, such Note Owner shall be deemed to have represented that such acquisition or purchase will not constitute or otherwise result in: (i) in the case of a Benefit Plan subject to Title I of ERISA or
Section 4975 of the Code, a non-exempt prohibited transaction in violation of Section 406 of ERISA or Section 4975 of the Code which is not covered by a class or other applicable exemption and (ii) in the case of a Benefit Plan subject to a
substantially similar federal, state, local or foreign law, a non-exempt violation of such substantially similar law. Any transfer found to have been made in violation of such deemed representation shall be null and void and of no effect.

  
 SECTION 2.11 Notices to Clearing Agency. Whenever a
notice or other communication is required under this Indenture to be given to Noteholders, unless and until Definitive Notes shall have been issued to Note Owners pursuant to Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to the applicable Clearing Agency. 
  
 SECTION 2.12 Definitive Notes. If (i) the Administrator advises the Indenture Trustee in writing that a Clearing Agency (a) is closed for business for a continuous period of 14 days (other than by reason of holiday, statutory or
otherwise), (b) announces an intention to cease business permanently (or does so and no alternative clearing system acceptable to the Indenture Trustee is then available), or (c) at any time, is unwilling or unable to continue as, or ceases to be, a
clearing agency registered under all applicable laws, and a successor clearing agency which is registered as a clearing agency under all applicable laws is not appointed by the Administrator within 90 days of such event, (ii) the Administrator at
its option advises the Indenture Trustee in writing that it elects to terminate the book-entry system through that Clearing Agency or (iii) after the occurrence of an Event of Default, a Servicer Default or an Administrator Default, Note Owners
representing beneficial interests aggregating at least a majority of the Outstanding Amount of the applicable Notes advise the applicable Clearing Agency (which shall then notify the Indenture Trustee) in writing that the continuation of a
book-entry system through such Clearing Agency is no longer in the best interests of such Note Owners, then the Indenture Trustee shall cause such Clearing Agency to notify all Note Owners cleared, through such Clearing Agency, of the occurrence of
any such event and of the availability of Definitive Notes to Note Owners requesting the same. Upon surrender to the Indenture Trustee of the typewritten Notes representing the Book-Entry Notes by a Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall authenticate the Definitive Notes in accordance with the instructions of such Clearing Agency, which shall include, without limitation, the identity and payment instructions for
all Noteholders of the applicable Notes. None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any delay in delivery of such instructions and may 

  

 9 

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

  
 ARTICLE III  
  
 Covenants 
  
 SECTION 3.1 Payments to Noteholders and each Swap Counterparty. The Issuer shall duly and punctually pay the
principal and interest, if any, with respect to the Notes in accordance with the terms of the Notes and this Indenture and shall duly and punctually pay amounts, if any, owing to each Swap Counterparty in accordance with the terms of this Indenture
and the related Swap Agreement. Without limiting the foregoing, the Issuer shall cause to be distributed to Noteholders and each Swap Counterparty in accordance with the Administration Agreement that portion of the amounts on deposit in the Trust
Accounts on a Distribution Date (other than any Eligible Investments deposited therein that will mature on the Business Day preceding a subsequent Distribution Date) or with respect to any Swap Counterparty amounts on deposit in the relevant Trust
Accounts on the date such payment is due under the related Swap Agreement, which the Noteholders and any Swap Counterparty are entitled to receive pursuant to Sections 2.7 and 2.8 of the Administration Agreement. Amounts properly withheld under the
Code by any Person from a payment to any Noteholder of interest and/or principal shall be considered as having been paid by the Issuer to such Noteholder for all purposes of this Indenture. 
  
 Section 3.1A Collateral Account. In the event that pursuant to the
terms of any applicable Swap Agreement, a related Swap Counterparty (or its credit support provider) is required to deposit cash or securities as collateral to secure its obligations (“Swap Collateral”), the Indenture Trustee shall
establish and maintain one or more Eligible Deposit Accounts in the name of the Indenture Trustee for the benefit of the Issuer and such Swap Counterparty (each a “Swap Agreement Collateral Account”). All sums on deposit and securities
held in any Swap Agreement Collateral Account shall be used only for the purposes set forth in the related credit support agreement to be entered into between the Trust and the related Swap Counterparty (a “Credit Support Agreement”).
Amounts on deposit in any Swap Agreement Collateral Account may be invested in Eligible Investments at the written direction of the related Swap Counterparty and on each Distribution Date, all Investment Earnings actually received by the Indenture
Trustee on amounts on deposit in a Swap Agreement Collateral Account or on securities held by the Indenture Trustee as Swap Collateral shall be paid directly to the related Swap Counterparty and not become part of Available Funds in accordance with
the terms of the Credit Support 

  

 10 

 
Agreement. All amounts deposited in a Swap Agreement Collateral Account shall be paid to the Issuer (and become part of Available Funds on the related
Distribution Date) or returned to the related Swap Counterparty, from time to time, in accordance with the provisions set forth in the related Credit Support Agreement. 
  
 SECTION 3.2 Maintenance of Office or Agency. The Issuer shall maintain in the Borough of Manhattan, The City of New
York and in Luxembourg, so long as any of the Notes are listed on the Luxembourg Stock Exchange and the rules of such exchange so require, or in such other jurisdiction if any of the Notes are listed on another stock exchange of international
standing and the rules of such other exchange so require, an office or agency where Notes may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may
be served. The Issuer hereby initially appoints the Indenture Trustee to serve as its agent for the foregoing purposes. The Issuer shall give prompt written notice to the Indenture Trustee of the location, and of any change in the location, of any
such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall fail to furnish the Indenture Trustee with the address thereof, such surrenders, notices and demands may be made or served at the Corporate
Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices and demands. 
  
 SECTION 3.3 Money for Payments to be Held in Trust. As provided in Section 8.2(a) and (b), all payments of amounts due and payable with respect to
any Notes or any Swap Agreement that are to be made from amounts distributed from the Collection Account, or deposited into the Collection Account from the Supplemental Purchase Account, the Add-On Consolidation Loan Account, the Capitalized
Interest Account or the Reserve Account, pursuant to Sections 2.7 and 2.8 of the Administration Agreement shall be made on behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so distributed from the Collection
Account for payments to Noteholders or any Swap Counterparty shall be paid over to the Issuer except as provided in this Section. 
  
 On or before the Business Day next preceding each Distribution Date and Redemption Date, the Issuer shall distribute or cause to be distributed to the
Indenture Trustee (or any other Paying Agent) an aggregate sum sufficient to pay the amounts then becoming due under the Notes or any Swap Agreement, such sum to be held in trust for the benefit of the Persons entitled thereto and (unless the Paying
Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee of its action or failure so to act. 
  
 The Issuer shall cause each Paying Agent other than the Indenture Trustee to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this Section, that such Paying Agent will: 
  
 (i) hold all sums held by it for the payment of amounts due with respect to
the Notes or any Swap Agreement in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided; 
  

 11 

 (ii) give the Indenture Trustee notice of any default by the Issuer of which it has actual knowledge (or
any other obligor upon the Notes) in the making of any payment required to be made with respect to the Notes or any Swap Agreement; 
  
 (iii) at any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture Trustee
all sums so held in trust by such Paying Agent; 
  
 (iv)
immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payments due under the Notes or any Swap Agreement if at any time it ceases to meet the standards required to be met by a Paying
Agent at the time of its appointment; and 
  
 (v) comply with all
requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith. 
  
 The Issuer may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts as those
upon which the sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such money. 
  
 Subject to applicable laws with respect to escheat of funds, any money held
by the Indenture Trustee or any Paying Agent in trust for the payment of any amount due with respect to any Note and remaining unclaimed for two years after such amount has become due and payable shall be discharged from such trust and be paid to
the Issuer on Issuer Request or if the Issuer has been terminated to the Depositor upon its written request; and the Noteholder thereof shall thereafter, as an unsecured general creditor, look only to the Issuer for payment thereof (but only to the
extent of the amounts so paid to the Issuer), and all liability of the Indenture Trustee or such Paying Agent with respect to such trust money shall thereupon cease; provided, however, that the Indenture Trustee or such Paying Agent,
before being required to make any such repayment, shall at the expense and direction of the Issuer cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in
The City of New York and in Luxembourg, so long as any of the Notes are listed on the Luxembourg Stock Exchange and the rules of such Exchange so require, or in such other jurisdiction if any of the Notes are listed on another stock exchange of
international standing and the rules of such other exchange so require, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance
of such money then remaining will be repaid to the Issuer. The Indenture Trustee shall also adopt and employ, at the expense of the Issuer, any other reasonable means of notification of such repayment (including mailing notice of such repayment to
Noteholders whose Notes have been called but have not been surrendered for redemption or whose right to or interest in moneys due and payable but not claimed is determinable from the records of the Indenture Trustee or of any Paying Agent, at the
last address of record for each such Noteholder). 
  
  

 12 

 SECTION 3.4 Existence. The Issuer shall keep in full effect its existence, rights and franchises
as a statutory trust under the laws of the State of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States of America, in which case the Issuer shall keep in
full effect its existence, rights and franchises under the laws of such other jurisdiction) and shall obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Indenture, the Notes, the Collateral and each other instrument or agreement included in the Indenture Trust Estate. 
  
 SECTION 3.5 Protection of Indenture Trust Estate. The Issuer will from time to time execute and deliver all such supplements and amendments hereto,
all such financing statements and continuation statements and will take such other action necessary or advisable to: 
  
 (i) maintain or preserve the lien and security interest (and the priority thereof) of this Indenture or carry out more effectively the purposes hereof;

  
 (ii) perfect, publish notice of or protect the validity of any
grant made or to be made by this Indenture; 
  
 (iii) enforce any
of the Collateral; or 
  
 (iv) preserve and defend title to the
Indenture Trust Estate and the rights of the Indenture Trustee, the Noteholders and each Swap Counterparty in such Indenture Trust Estate against the claims of all persons and parties. 
  
 The Issuer hereby designates the Indenture Trustee its agent and attorney-in-fact to execute any financing statement,
continuation statement or other instrument required to be executed pursuant to this Section. 
  
 SECTION 3.6 Opinions as to Indenture Trust Estate. (a) On the Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording and filing of this Indenture as is necessary to perfect and make effective the lien and security interest of this Indenture and reciting the details of such action, or stating that, in the opinion
of such counsel, no such action is necessary to make such lien and security interest effective. 
  
 (b) On or before December 31 in each calendar year, beginning in 2005, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with respect to the recording, filing, re-recording and refiling of this Indenture and any indentures supplemental hereto as is necessary to maintain the lien and security
interest created by this Indenture and relating the details of such action or stating that in the opinion of such counsel no such action is necessary to maintain such lien and security interest. Such Opinion of Counsel shall also describe the
recording, filing, recording and refiling of this Indenture and any indentures supplemental hereto that will, in the opinion of such counsel, be required to maintain the lien and security interest of this Indenture until December 31 in the following
calendar year. 
  
  

 13 

 SECTION 3.7 Performance of Obligations; Servicing of Trust Student Loans. (a) The Issuer will not
take any action and will use its best efforts not to permit any action to be taken by others that would release any Person from any of such Person’s material covenants or obligations under any instrument or agreement included in the Indenture
Trust Estate or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, except as expressly provided in this Indenture, any other
Basic Document or such other instrument or agreement. 
  
 (b) The
Issuer may contract with other Persons to assist it in performing its duties under this Indenture, and any performance of such duties by a Person identified to the Indenture Trustee in an Officers’ Certificate of the Issuer shall be deemed to
be action taken by the Issuer; provided, however, the Issuer shall not be liable for any acts of Persons with whom the Issuer has contracted with reasonable care. Initially, the Issuer has contracted with the Servicer and the
Administrator to assist the Issuer in performing its duties under this Indenture. The Issuer shall give written notice to the Indenture Trustee and each Rating Agency of any such contract with any other Person. 
  
 (c) The Issuer shall punctually perform and observe all of its obligations
and agreements contained in this Indenture, the other Basic Documents and the instruments and agreements included in the Indenture Trust Estate, including filing or causing to be filed all UCC financing statements and continuation statements
prepared by the Issuer and required to be filed by the terms of this Indenture and the Administration Agreement in accordance with and within the time periods provided for herein and therein. Except as otherwise expressly provided therein, the
Issuer shall not waive, amend, modify, supplement or terminate any Basic Document or any provision thereof without the consent of the Indenture Trustee or the Noteholders of at least a majority of the Outstanding Amount of the Notes;
provided, for the avoidance of doubt, that a transfer or assignment by a Swap Counterparty of any of its interests or obligations in accordance with the requirements of any applicable Swap Agreement (including the requirement that each Rating
Agency then rating the Notes issue written acknowledgment that, notwithstanding such transfer or assignment, the then-current rating of the Notes will not be downgraded) shall not constitute a waiver, amendment, modification, supplement or
termination of the applicable Swap Agreement or any provision thereof and shall not require the consent of the Indenture Trustee or the Noteholders of at least a majority of the Outstanding Amount of the Notes. The Issuer shall give written notice
to each Rating Agency or any such waiver, amendment, modification, supplement or termination that requires the consent of the Indenture Trustee or the Noteholders of at least a majority of the Outstanding Amount of the Notes. 
  
 (d) If a Responsible Officer of the Issuer shall have knowledge of the
occurrence of a Servicer Default or an Administrator Default under the Servicing Agreement or the Administration Agreement, respectively, the Issuer shall promptly notify the Indenture Trustee and the Rating Agencies thereof, and shall specify in
such notice the action, if any, the Issuer is taking with respect to such default. If a Servicer Default shall arise from the failure of the Servicer to perform any of its duties or obligations under the Servicing Agreement, or an Administrator
Default shall arise from the failure of the Administrator to perform any of its 

  

 14 

 
duties or obligations under the Administration Agreement, as the case may be, with respect to the Trust Student Loans, the Issuer shall take all reasonable
steps available to it to enforce its rights under the Basic Documents in respect of such failure. 
  
 (e) As promptly as possible after the giving of notice of termination to the Servicer of the Servicer’s rights and powers, pursuant to Section 5.1 of
the Servicing Agreement, or to the Administrator of the Administrator’s rights and powers, pursuant to Section 5.1 of the Administration Agreement, the Issuer shall appoint a successor servicer (the “Successor Servicer”) or a
successor administrator (the “Successor Administrator”), respectively, and such Successor Servicer or Successor Administrator, as the case may be, shall accept its appointment by a written assumption in a form acceptable to the Indenture
Trustee. In the event that a Successor Servicer or Successor Administrator has not been appointed and accepted its appointment at the time when the Servicer or Administrator, as the case may be, ceases to act as Servicer or Administrator,
respectively, the Indenture Trustee without further action shall automatically be appointed the Successor Servicer or Successor Administrator, as the case may be. The Indenture Trustee may resign as the Successor Servicer or the Successor
Administrator by giving written notice of resignation to the Issuer and in such event will be released from such duties and obligations, such release not to be effective until the date a new servicer or a new administrator enters into an agreement
with the Issuer as provided below; provided, however, that nothing herein shall require or permit the Indenture Trustee to act as Servicer, or otherwise service the Trust Student Loans, in violation of the Higher Education Act. Upon
delivery of any such notice to the Issuer, the Issuer shall obtain a new servicer as the Successor Servicer under the Servicing Agreement or a new administrator as the Successor Administrator under the Administration Agreement, as the case may be.
Any Successor Servicer or Successor Administrator, other than the Indenture Trustee, shall (i) be an established institution (A) that satisfies any requirements of the Higher Education Act applicable to servicers and (B) whose regular business
includes the servicing or administration of student loans and (ii) enter into a servicing agreement or an administration agreement, respectively, with the Issuer having substantially the same provisions as the provisions of the Servicing Agreement
and the Administration Agreement, as applicable. If within 30 days after the delivery of the notice referred to above, the Issuer shall not have obtained such a new servicer or new administrator, as the case may be, the Indenture Trustee may
appoint, or may petition a court of competent jurisdiction to appoint, a Successor Servicer or Successor Administrator; provided, however, that such right to appoint or to petition for the appointment of any such successor shall in no
event relieve the Indenture Trustee from any obligations otherwise imposed on it under the Basic Documents until such successor has in fact assumed such appointment. In connection with any such appointment, the Indenture Trustee may make such
arrangements for the compensation of such successor as it and such successor shall agree, subject to the limitations set forth below and in the Servicing Agreement or Administration Agreement, as applicable, and in accordance with Section 5.2 of the
Servicing Agreement and Section 5.2 of the Administration Agreement, the Issuer shall enter into an agreement with such successor for the servicing or administration of the Trust Student Loans (such agreement to be in form and substance satisfactory
to the Indenture Trustee). If the Indenture Trustee shall succeed as provided herein to the Servicer’s duties as Servicer with respect to the Trust Student Loans, or the Administrator’s duties with respect to the Issuer and the Trust
Student Loans, as the case may be, it shall do so in its individual capacity and not in its capacity as Indenture Trustee and, accordingly, the provisions of Article VI hereof shall be inapplicable to the Indenture Trustee in its duties as the
successor to the Servicer or the 

  

 15 

 
Administrator, as the case may be, and the servicing or administration of the Trust Student Loans. In case the Indenture Trustee shall become successor to
the Servicer or the Administrator, the Indenture Trustee shall be entitled to appoint as Servicer or as Administrator, as the case may be, any one of its Affiliates, provided that such appointment shall not affect or alter in any way the liability
of the Indenture Trustee as Successor Servicer or Successor Administrator, respectively, in accordance with the terms hereof. 
  
 (f) Upon any termination of the Servicer’s rights and powers pursuant to the Servicing Agreement, or any termination of the Administrator’s
rights and powers pursuant to the Administration Agreement, as the case may be, the Issuer shall promptly notify the Indenture Trustee and each Rating Agency. As soon as a Successor Servicer or a Successor Administrator is appointed, the Issuer
shall notify the Indenture Trustee and each Rating Agency of such appointment, specifying in such notice the name and address of such Successor Servicer or such Successor Administrator. 
  
 (g) Without derogating from the absolute nature of the assignment granted to the Indenture Trustee under this Indenture or
the rights of the Indenture Trustee hereunder, the Issuer agrees that it will not, without the prior written consent of the Indenture Trustee or the Noteholders of at least a majority in Outstanding Amount of the Notes, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification, supplement, termination, waiver or surrender of, the terms of any Collateral or the Basic Documents, except to the extent otherwise provided in the Basic Documents, or
waive timely performance or observance by the Servicer, the Administrator, the Depositor, any Excess Distribution Certificateholder, SLM ECFC, VG Funding, the Issuer, the Eligible Lender Trustee or any Swap Counterparty under the Basic Documents;
provided, however, that no such amendment shall (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, distributions that are required to be made for the benefit of the Noteholders or any Swap
Counterparty, or (ii) reduce the aforesaid percentage of the Notes which are required to consent to any such amendment, without the consent of the Noteholders of all the Outstanding Notes. If any such amendment, modification, supplement or waiver
shall be so consented to by the Indenture Trustee or such Noteholders, the Issuer shall give written notice thereof to each Rating Agency and agrees, promptly following a request by the Indenture Trustee to do so, to execute and deliver, in its own
name and at its own expense, such agreements, instruments, consents and other documents as the Indenture Trustee may deem necessary or appropriate in the circumstances. 
  
 SECTION 3.8 Negative Covenants. So long as any Notes are Outstanding, the Issuer shall not: 
  
 (i) except as expressly permitted by this Indenture or any other Basic
Document, sell, transfer, exchange or otherwise dispose of any of the properties or assets of the Issuer, including those included in the Indenture Trust Estate, unless directed to do so by the Indenture Trustee; 
  
 (ii) claim any credit on, or make any deduction from the principal or
interest payable in respect of, the Notes (other than amounts properly withheld from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the payment of the taxes levied or
assessed upon any part of the Indenture Trust Estate; 
  
  

 16 

 (iii) (A) permit the validity or effectiveness of this Indenture to be impaired, or permit the lien of
this Indenture to be amended, hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with respect to the Notes under this Indenture except as may be expressly permitted hereby, (B)
permit any lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Indenture Trust Estate or any part thereof or any
interest therein or the proceeds thereof (other than tax liens and other liens that arise by operation of law, and other than as expressly permitted by the Basic Documents) or (C) permit the lien of this Indenture not to constitute a valid first
priority (other than with respect to any such tax or other lien) security interest in the Indenture Trust Estate; or 
  
 (iv) enter into any amendment to any Swap Agreement to cure any ambiguity in, or to correct or supplement any provision of any Swap Agreement, unless the
Issuer has determined, and the Indenture Trustee has agreed in writing at the written direction of the Issuer, that the amendment will not materially adversely affect the interests of the Noteholders and provided that the Issuer has provided
reasonable notice to the Rating Agencies of such amendment and the Rating Agency Condition is satisfied. 
  
 SECTION 3.9 Annual Statement as to Compliance. The Issuer will deliver to the Indenture Trustee and each Rating Agency, within 90 days after the
end of each fiscal year of the Issuer (commencing with the fiscal year ending December 31, 2005), an Officers’ Certificate of the Issuer stating that: 
  
 (i) a review of the activities of the Issuer during such year and of performance under this Indenture has been made under such Authorized Officers’
supervision; and 
  
 (ii) to the best of such Authorized
Officers’ knowledge, based on such review, the Issuer has complied with all conditions and covenants under this Indenture throughout such year, or, if there has been a default in the compliance of any such condition or covenant, specifying each
such default known to such Authorized Officers and the nature and status thereof. 
  
 SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms. 
  
 (a) The Issuer shall not consolidate or merge with or into any other Person, unless: 
  
 (i) the Person (if other than the Issuer) formed by or surviving such consolidation or merger shall be a Person organized
and existing under the laws of the United States of America or any State and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the due and
punctual payment of the principal of, and interest, if any, on all Notes and the performance or observance of every agreement and covenant of this Indenture and the other Basic Documents on the part of the Issuer to be performed or observed, all as
provided herein; 
  

 17 

 (ii) immediately after giving effect to such transaction, no Default shall have occurred and be
continuing; 
  
 (iii) the Rating Agency Condition shall have been
satisfied with respect to such transaction; 
  
 (iv) the Issuer
shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that such transaction will not have any material adverse Federal or Delaware state tax consequence to the Issuer or any
Noteholder or any Swap Counterparty; 
  
 (v) any action as is
necessary to maintain the lien and security interest created by this Indenture shall have been taken; and 
  
 (vi) the Issuer shall have delivered to the Indenture Trustee an Officers’ Certificate of the Issuer and an Opinion of Counsel each stating that such
consolidation or merger and such supplemental indenture comply with this Article III and that all conditions precedent herein provided for relating to such transaction have been complied with (including any filing required by the Exchange Act).

  
 (b) The Issuer shall not convey or transfer all or
substantially all of its properties or assets, including those included in the Indenture Trust Estate, to any Person, unless: 
  
 (i) the Person that acquires by conveyance or transfer the properties and assets of the Issuer the conveyance or transfer of which is hereby restricted
shall (A) be a United States citizen or a Person organized and existing under the laws of the United States of America or any State, (B) expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form
satisfactory to the Indenture Trustee, the due and punctual payment of the principal of, and interest, if any, on all Notes and the performance or observance of every agreement and covenant of this Indenture on the part of the Issuer to be performed
or observed, all as provided herein, (C) expressly agree by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Noteholders and any Currency Swap
Counterparty, (D) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend and hold harmless the Issuer against and from any loss, liability or expense arising under or related to this Indenture and the Notes
and (E) expressly agree by means of such supplemental indenture that such Person (or if a group of Persons, then one specified Person) shall make all filings with the Commission (and any other appropriate Person) required by the Exchange Act in
connection with the Notes; 
  
 (ii) immediately after giving
effect to such transaction, no Default shall have occurred and be continuing; 
  
 (iii) the Rating Agency Condition shall have been satisfied with respect to such transaction; 
  
 (iv) the Issuer shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that such
transaction will not have any material adverse Federal or Delaware state tax consequence to the Issuer or any Noteholder; 
  

 18 

 (v) any action as is necessary to maintain the lien and security interest created by this Indenture shall
have been taken; and 
  
 (vi) the Issuer shall have delivered to
the Indenture Trustee an Officers’ Certificate of the Issuer and an Opinion of Counsel each stating that such conveyance or transfer and such supplemental indenture comply with this Article III and that all conditions precedent herein provided
for relating to such transaction have been complied with (including any filing required by the Exchange Act). 
  
 SECTION 3.11 Successor or Transferee. (a) Upon any consolidation or merger of the Issuer in accordance with Section 3.10(a), the Person formed by
or surviving such consolidation or merger (if other than the Issuer) shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with the same effect as if such Person had been named as the
Issuer herein. 
  
 (b) Upon a conveyance or transfer of all the
assets and properties of the Issuer pursuant to Section 3.10(b), SLM Student Loan Trust 2005-5 will be released from every covenant and agreement of this Indenture to be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery by the Issuer of written notice to the Indenture Trustee stating that SLM Student Loan Trust 2005-5 is to be so released. 
  
 SECTION 3.12 No Other Business. The Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the
Trust Student Loans and the other assets of the Issuer and related proceeds thereof in addition to entering into Swap Agreements, as applicable, from time to time on the related Reset Date, in the manner contemplated by this Indenture and the other
Basic Documents and activities incidental thereto. 
  
 SECTION
3.13 No Borrowing. The Issuer shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness except for the Notes. 
  
 SECTION 3.14 Obligations of Servicer and Administrator. The Issuer shall cause the Servicer to comply with Sections
3.1, 3.2 and 3.3 of the Administration Agreement and Section 3.7 of the Servicing Agreement and the Administrator to comply with Sections 2.11, 3.1, 3.2 and 3.3 of the Administration Agreement. 
  
 SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities. Except
as contemplated by this Indenture and the other Basic Documents, the Issuer shall not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuring another’s payment or performance
on any obligation or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree
contingently to do so) any stock, obligations, assets or securities of, or any other interest in, or make any capital contribution to, any other Person. 
  
 SECTION 3.16 Capital Expenditures. The Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty). 
  

 19 

 SECTION 3.17 Restricted Payments. The Issuer shall not, directly or indirectly, (i) pay any
dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Eligible Lender Trustee or any owner of a beneficial interest in the Issuer or otherwise with respect to
any ownership or equity interest or security in or of the Issuer or to the Servicer or the Administrator, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; provided, however, that the Issuer may make, or cause to be made, distributions to the Servicer, the Eligible Lender Trustee, the Indenture Trustee, the Noteholders, any Swap Counterparty,
any Remarketing Agent, the Administrator, the Depositor and the Excess Distribution Certificateholder as contemplated by, and to the extent funds are available for such purpose under, this Indenture and the other Basic Documents. The Issuer will
not, directly or indirectly, make payments to or distributions from the Collection Account except in accordance with this Indenture and the other Basic Documents. 
  
 SECTION 3.18 Notice of Events of Default. The Issuer shall give the Indenture Trustee, the Rating Agencies and each
Swap Counterparty prompt written notice of each Event of Default hereunder. The Issuer shall give the Indenture Trustee, the Rating Agencies and each Swap Counterparty prompt written notice of each default on the part of (i) the Depositor of its
obligations under the Sale Agreement, (ii) SLM ECFC of its obligations under the SLM ECFC Purchase Agreement, (iii) VG Funding of its obligations under the VG Funding Purchase Agreement, (iv) the Servicer of its obligations under the Servicing
Agreement, or (v) the Administrator of its obligations under the Administration Agreement. In addition, the Issuer shall deliver to the Indenture Trustee, each Rating Agency and each Swap Counterparty, within five days after the occurrence thereof,
written notice in the form of an Officers’ Certificate of the Issuer of any event which with the giving of notice and the lapse of time would become an Event of Default under Section 5.1(iii), its status and what action the Issuer is taking or
proposes to take with respect thereto. 
  
 SECTION 3.19 Further
Instruments and Acts. Upon request of the Indenture Trustee, the Issuer will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this
Indenture. 
  
 ARTICLE IV 
  
 Satisfaction and Discharge 
  
 SECTION 4.1 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (i) rights of registration of transfer and exchange, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments of
principal thereof and interest thereon, (iv) Sections 3.3, 3.4, 3.5, 3.8, 3.10, 3.12 and 3.13, (v) the rights, obligations and immunities of the Indenture Trustee hereunder (including, without limitation, the rights of the Indenture Trustee under
Section 6.7 and the obligations of the Indenture Trustee under Section 4.2) and (vi) the rights of Noteholders as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the
Indenture Trustee, on demand of and at the expense of the 

  

 20 

 
Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes, when: 
  
 (a) either 
  
 (1) all Notes theretofore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.5 and (ii) Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 3.3) have been delivered to the Indenture Trustee for cancellation; or 
  
 (2) all Notes not theretofore delivered to the Indenture Trustee for cancellation: 
  
 (i) have become due and payable, 
  

(ii) will become due and payable at their respective Note Final Maturity Date, within one year, or 
  
 (iii) are to be called for redemption within one year under arrangements
satisfactory to the Indenture Trustee for the giving of notice of redemption by the Indenture Trustee in the name, and at the expense, of the Issuer, and the Issuer, in the case of (i), (ii) or (iii) above, has irrevocably deposited or caused to be
irrevocably deposited with the Indenture Trustee cash or direct obligations of or obligations guaranteed by the United States of America (which will mature prior to the date such amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture Trustee for cancellation when due to the Note Final Maturity Date; 
  
 (b) the Issuer has paid or caused to be paid all other sums payable hereunder by the Issuer; and 
  
 (c) the Issuer has delivered to the Indenture Trustee an Officers’
Certificate of the Issuer, an Opinion of Counsel and (if required by the TIA or the Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of Section 11.1(a) and, subject
to Section 11.2, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. 
  
 SECTION 4.2 Application of Trust Money. All moneys deposited with the Indenture Trustee pursuant to Section 4.1
hereof shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Noteholders of the
particular Notes or to any Swap Counterparty, as applicable, for the payment or redemption of which such moneys have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such moneys
need not be segregated from other funds except to the extent required herein or in the Administration Agreement or required by law. 
  

 21 

 SECTION 4.3 Repayment of Moneys Held by Paying Agent. In connection with the satisfaction and
discharge of this Indenture with respect to the Notes, all moneys then held by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes shall, upon demand of the Issuer, be paid to the
Indenture Trustee to be held and applied according to Section 3.3 and thereupon such Paying Agent shall be released from all further liability with respect to such moneys. 
  
 SECTION 4.4 Auction of Trust Student Loans. On the date (the “Trust Auction Date”) that is three Business
Days prior to the Distribution Date immediately following the end of the first Collection Period when the Pool Balance is equal to 10% or less of the Initial Pool Balance, any Trust Student Loans remaining in the Trust shall be offered for sale by
the Indenture Trustee unless the Servicer has exercised its option to purchase the Trust Estate as described in Section 6.1(a) of the Administration Agreement with respect to such Distribution Date. The Servicer will be deemed to have waived such
option if it fails to notify the Eligible Lender Trustee and the Indenture Trustee of its exercise thereof in writing prior to the Indenture Trustee’s acceptance of a bid to purchase such Trust Student Loans; provided, however,
that there shall be no such offer for sale if the Indenture Trustee fails to provide notice to the Servicer in accordance with this Section 4.4. The Indenture Trustee shall provide written notice to the Servicer of any such offer for sale at least 5
Business Days in advance of the Trust Auction Date. The Indenture Trustee shall permit the Depositor or any of its Affiliates, including SLM ECFC, VG Funding and the Servicer, to offer bids only if the Pool Balance as of the applicable Trust Auction
Date is equal to 10% or less of the Initial Pool Balance, and such bid does not exceed the fair market value of the Trust Student Loans as of the Trust Auction Date. If at least two bids are received, the Indenture Trustee shall solicit and
resolicit new bids from all participating bidders until only one bid remains or the remaining bidders decline to resubmit bids. The Indenture Trustee shall accept the highest of such remaining bids if it is equal to or in excess of both (i) the
Minimum Purchase Amount plus any amounts owed to any Swap Counterparty for Swap Payments and Swap Termination Payments and amounts to any Remarketing Agent for any unpaid remarketing fees and expenses, and any Carryover Servicing Fees and (ii) the
fair market value of such Trust Student Loans as of the end of the Collection Period immediately preceding the Trust Auction Date. If at least two bids are not received or the highest bid after the resolicitation process is completed is not equal to
or in excess of the higher of (i) the Minimum Purchase Amount plus any amounts owed to any Swap Counterparty for Swap Payments and Swap Termination Payments and amounts to any Remarketing Agent for any unpaid remarketing fees and expenses, and any
Carryover Servicing Fees and (ii) the fair market value of the Trust Student Loans, the Indenture Trustee shall not consummate such sale. The Indenture Trustee may consult, and, at the direction of the Depositor, shall consult, with a financial
advisor, including an Underwriter of the Notes or the Administrator, to determine if the fair market value of the Trust Student Loans has been offered. The proceeds of any such sale will be paid at the time set forth in Section 2.6 of the
Administration Agreement and applied in the order of priority set forth in Section 5.4(b). If the sale is not consummated in accordance with the foregoing, the Indenture Trustee may, but shall not be under any obligation to, solicit bids for sale of
the Trust Student Loans with respect to future Distribution Dates upon terms similar to those described above, including the Servicer’s waiver of its option to purchase the Trust Estate in accordance with Section 6.1(a) of the Administration
Agreement with respect to each such future Distribution Date. 
  

 22 

 ARTICLE V  
  

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

  
 (i) default in the payment of any interest on any Note when
the same becomes due and payable, and such default shall continue for a period of five days; or 
  
 (ii) default in the payment of the principal of any Note when the same becomes due and payable on the related Note Final Maturity Date; or 
  
 (iii) default in the observance or performance of any covenant or agreement
of the Issuer made in this Indenture (other than a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section specifically dealt with), or any representation or warranty of the Issuer made in this
Indenture or in any certificate or other writing having been incorrect in any material respect as of the time when made, such default or breach having a material adverse effect on the holders of the Notes, and such default or breach shall continue
or not be cured, or the circumstance or condition in respect of which such misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period of 30 days after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Noteholders of at least 25% of the Outstanding Amount of the Notes, a written notice specifying such default or incorrect representation or
warranty and requiring it to be remedied and stating that such notice is a notice of Default hereunder; or 
  
 (iv) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer or any substantial part of the
Indenture Trust Estate in an involuntary case under any applicable Federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Issuer or for any substantial part of the Indenture Trust Estate, or ordering the winding-up or liquidation of the Issuer’s affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive
days; or 
  
 (v) the commencement by the Issuer of a voluntary
case under any applicable Federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the
Issuer to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Indenture Trust Estate, or the making by the Issuer of any
general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of action by the Issuer in furtherance of any of the foregoing. 
  

 23 

 SECTION 5.2 Acceleration of Maturity; Rescission and Annulment. If an Event of Default should
occur and be continuing, then and in every such case the Indenture Trustee or the Noteholders representing at least a majority of the Outstanding Amount of the Notes may declare all the Notes to be immediately due and payable, by a notice in writing
to the Issuer (and to the Indenture Trustee if given by Noteholders), and upon any such declaration the unpaid principal amount of such Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall become
immediately due and payable, subject, however, to Section 5.4 of this Indenture. 
  
 At any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Noteholders of Notes representing at least a majority of the Outstanding Amount of the Notes, by written notice to the Issuer and the Indenture Trustee, may rescind and annul such declaration and its consequences if: 
  
 (i) the Issuer has paid or deposited with the Indenture Trustee a sum
sufficient to pay: 
  
 (a) all payments of
principal of and interest on all Notes and all other amounts that would then be due hereunder or upon such Notes if the Event of Default giving rise to such acceleration had not occurred; and 
  
 (b) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel; and 
  
 (ii) all Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have been cured or
waived as provided in Section 5.12. 
  
 No such rescission shall
affect any subsequent default or impair any right consequent thereto. 
  
 SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee. The Issuer covenants that if (i) default is made in the payment of any interest on any Note when the same becomes due and payable, and such
default continues for a period of five days, or (ii) default is made in the payment of the principal of any Note when the same becomes due and payable at the related Note Final Maturity Date, the Issuer shall, upon demand of the Indenture Trustee,
pay to it, for the benefit of the Noteholders, the whole amount then due and payable on such Notes for principal and interest, with interest upon the overdue principal, and, to the extent payment at such rate of interest shall be legally
enforceable, upon overdue installments of interest, at the rate specified in Section 2.7 and in addition thereto such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee and its agents and counsel. 
  
 (a) In case the Issuer shall fail forthwith to pay such amounts upon such demand, the Indenture Trustee, in its own name and as trustee of an express trust, may institute a Proceeding 

  

 24 

 
for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against the Issuer
or other obligor upon such Notes and collect in the manner provided by law out of the property of the Issuer or other obligor upon such Notes, wherever situated, the moneys adjudged or decreed to be payable. 
  
 (b) If an Event of Default occurs and is continuing, the Indenture Trustee
may, as more particularly provided in Section 5.4, in its discretion, proceed to protect and enforce its rights and the rights of the Noteholders and any Currency Swap Counterparty by such appropriate Proceedings as the Indenture Trustee shall deem
most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or
equitable right vested in the Indenture Trustee by this Indenture or by law. 
  
 (c) In case there shall be pending, relative to the Issuer or any other obligor upon the Notes or any Person having or claiming an ownership interest in the Indenture Trust Estate, Proceedings under Title 11 of the
United States Code or any other applicable Federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other obligor or Person, or in case of any other, comparable judicial Proceedings relative to the Issuer or other obligor upon the Notes, or to the creditors or property of the
Issuer or such other obligor, the Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable, as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have
made any demand pursuant to the provisions of this Section, shall be entitled and empowered, by intervention in such proceedings or otherwise: 
  
 (i) to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Notes and to file such other
papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee (including any claim for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or bad faith) and of the Noteholders
allowed in such Proceedings; 
  
 (ii) unless prohibited by
applicable law and regulations, to vote on behalf of the Noteholders (and, if applicable, any Currency Swap Counterparty) in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceedings; 
  
 (iii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders, any Currency Swap Counterparty and the Indenture Trustee on their behalf; and 
  
 (iv) to file such proofs of claim and other papers or documents as may be
necessary or advisable in order to have the claims of the Indenture Trustee, any Currency Swap Counterparty or the Noteholders allowed in any judicial Proceedings relative to the Issuer, its creditors and its property; 
  
  

 25 

 and any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is
hereby authorized by each of such Noteholders and any Currency Swap Counterparty to make payments to the Indenture Trustee, and, in the event that the Indenture Trustee shall consent to the making of payments directly to such Noteholders and any
Currency Swap Counterparty to pay to the Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to the Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all
other expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or bad faith. 
  
 (d) Nothing herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or
accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Noteholder thereof or to authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person. 
  
 (e) All rights of action and of asserting claims under this Indenture, or under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the ratable benefit of the
Noteholders, and after the Notes have been paid in full, and subject to the provisions of Section 11.19, any Currency Swap Counterparty. 
  
 (f) In any Proceedings brought by the Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which
the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all the Noteholders and each Currency Swap Counterparty, and it shall not be necessary to make any Noteholder or any Currency Swap Counterparty a party to any
such Proceedings. 
  
 SECTION 5.4 Remedies; Priorities. If
an Event of Default shall have occurred and be continuing, the Indenture Trustee may do one or more of the following (subject to Section 5.5): 
  
 (a) (i) institute Proceedings in its own name and as trustee of an express trust for the collection of all amounts then payable on the Notes or under this
Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from the Issuer and any other obligor upon such Notes moneys adjudged due; 
  
 (ii) institute Proceedings from time to time for the complete or partial foreclosure of this Indenture, with respect to the
Indenture Trust Estate; 
  

 26 

 (iii) exercise any remedies of a secured party under the UCC with respect to the Trust Estate and take
any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee, any Currency Swap Counterparty and the Noteholders; 
  
 (iv) sell the Indenture Trust Estate or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted in
any manner permitted by law; and/or 
  
 (v) elect to have the
Eligible Lender Trustee maintain ownership of the Trust Student Loans and continue to apply collections with respect to the Trust Student Loans as if there had been no declaration of acceleration; 
  
 provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than an Event of Default described in Section 5.1(i) or (ii) with respect to the Class A Notes, unless (A) the Noteholders of 100% of the Outstanding Amount of the Class A
Notes consent thereto, (B) the proceeds of such sale or liquidation distributable to the Class A Noteholders are sufficient to discharge in full all amounts then due and unpaid upon such Class A Notes for principal and interest or (C) the Indenture
Trustee determines that the Indenture Trust Estate will not continue to provide sufficient funds for the payment of principal of and interest on the Class A Notes as would have become due if the Class A Notes had not been declared due and payable,
and the Indenture Trustee obtains the consent of Noteholders of 66-2/3% of the Outstanding Amount of the Class A Notes; provided, further, that the Indenture Trustee may not sell or otherwise liquidate the Indenture Trust Estate
following an Event of Default, other than an Event of Default described in Section 5.1(i) or (ii) with respect to the Class A Notes, unless (D) the proceeds of such sale or liquidation distributable to the Class B Noteholders plus the proceeds of
the sale or liquidation of the Trust Estate distributable to the Class B Noteholders are sufficient to pay to the Class B Noteholders the Outstanding Amount of the Class B Notes plus accrued and unpaid interest thereon or (E) after receipt of notice
from the Eligible Lender Trustee that the proceeds of such sale or liquidation distributable to the Class B Noteholders plus the proceeds of the sale or liquidation of the Trust Estate distributable to the Class B Noteholders would not be sufficient
to pay to the Class B Noteholders the outstanding principal plus accrued and unpaid interest thereon, the Class B Noteholders of at least a majority of the Outstanding Amount of the Class B Notes consent thereto. In determining such sufficiency or
insufficiency with respect to clauses (B), (C), (D) and (E), the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Indenture Trust Estate and/or Trust Estate, as applicable, for such purpose. 
  
 (b) Notwithstanding the provisions of Section 8.2, following the occurrence and during the continuation of an Event of Default specified in Section
5.1(i), 5.1(ii), 5.1(iv) or 5.1(v) which has resulted in an acceleration of the Notes, if the Indenture Trustee collects any money or property, it shall pay out the money or property (and other amounts including amounts, if any, held on deposit in
each of the Trust Accounts) held as Collateral for the benefit of the Noteholders, net of liquidation costs associated with the sale of the assets of the Trust, in the following order: 
  

 27 

 FIRST: 
  

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

 

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

  
 SECOND: to the Indenture Trustee for amounts
due under Section 6.7; 
  
 THIRD: to the Servicer for due and
unpaid Primary Servicing Fees; 
  
 FOURTH: to the Administrator,
any due and unpaid Administration Fees; 
  
 FIFTH: pro rata, based
on amounts due and owing: 
  

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

  

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

  

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

  

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 SIXTH: 
  

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

  

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

  
 SEVENTH: to the Class B
Noteholders for amounts due and unpaid on the Class B Notes for interest at the Class B Note Rate; 
  
 EIGHTH: to the Class B Noteholders, an amount sufficient to reduce the Outstanding Amount of the Class B Notes to zero; 
  
 NINTH: to the Servicer, for any unpaid Carryover Servicing Fees; 

 
 TENTH: to any Swap Counterparties, pro rata, the amount of any Swap
Termination Payments due to such Swap Counterparties by the Issuer and not payable in Clause FIFTH (C); 
  
 ELEVENTH: to the Remarketing Agents, any due and unpaid Remarketing Fees payable by the Issuer to the extent not previously paid from amounts on deposit
in the Remarketing Fee Account; 
  
 TWELFTH: sequentially, first
to the Remarketing Agents, and second to the Administrator for any advances made on behalf of the Issuer, in each case, for payment of certain costs and expenses as set forth in Section 3 of the Remarketing Agreement in connection with the
remarketing of the Reset Rate Notes not previously reimbursed by the Issuer; and 
  
 THIRTEENTH: to the Excess Distribution Certificateholder, any remaining funds. 
  
 If the Trust has entered into a Currency Swap Agreement and such Currency Swap Agreement terminates, amounts that would have otherwise been paid to the
related Currency Swap Counterparty (other than amounts payable as a Termination Payment thereunder) will be used to make payments to the Reset Rate Noteholders in an amount in the applicable non-U.S. Dollar currency, equal to the payment that the
related Currency Swap Counterparty would have made. If this occurs, the Trust will exchange U.S. Dollars for the applicable non-U.S. Dollar currency in order to make distributions on the Reset Rate Notes. 
  
 The Indenture Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section. At least 15 days before such record date, the Indenture Trustee shall mail to each Noteholder and the Issuer a notice that states the record date, the payment date and the amount to be paid. 
  
  

 29 

 SECTION 5.5 Optional Preservation of the Trust Student Loans. If the Notes have been declared to
be due and payable under Section 5.2 following an Event of Default and such declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may, but need not, elect to maintain possession of the Indenture Trust Estate.
It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for the payment of principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining whether
or not to maintain possession of the Indenture Trust Estate. In determining whether to maintain possession of the Indenture Trust Estate, the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Indenture Trust Estate for such purpose. 
  
 SECTION 5.6 Limitation of Suits. No Noteholder shall have any right to institute any Proceeding, judicial or
otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless: 
  
 (i) such Noteholder has previously given written notice to the Indenture Trustee of a continuing Event of Default; 
  
 (ii) the Noteholders of not less than 25% of the Outstanding Amount of the
Notes have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its own name as Indenture Trustee hereunder; 
  
 (iii) such Noteholder or Noteholders have offered to the Indenture Trustee reasonable indemnity against the costs, expenses
and liabilities to be incurred in complying with such request; 
  
 (iv) the Indenture Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute such Proceeding; and 
  
 (v) no direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Noteholders of at least a
majority of the Outstanding Amount of the Notes; 
  
 it being
understood and intended that no one or more Noteholders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this indenture to affect, disturb or prejudice the rights of any other Noteholders or to obtain or
to seek to obtain priority or preference over any other Noteholders or to enforce any right under this Indenture, except in the manner herein provided. 
  
 In the event the Indenture Trustee shall receive conflicting or inconsistent requests and indemnity from two or more groups of Noteholders, each
representing less than a majority of the Outstanding Amount of the Notes, the Indenture Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other provisions of this Indenture. 
  

 30 

 SECTION 5.7 Unconditional Rights of Noteholders to Receive Principal and Interest. Notwithstanding
any other provisions in this Indenture, each Noteholder shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest on its Note on or after the respective due dates thereof expressed in such Note or
in this Indenture (or, in the case of redemption, on or after the Redemption Date) and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Noteholder. 
  
 SECTION 5.8 Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and the Noteholders shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all
rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted. 
  
 SECTION 5.9 Rights and Remedies Cumulative. No right or remedy herein conferred upon or reserved to the Indenture Trustee, any Swap Counterparty or
to the Noteholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing
at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. 
  
 SECTION 5.10 Delay or Omission Not a Waiver. No delay or omission of
the Indenture Trustee, any Swap Counterparty or any Noteholder to exercise any right or remedy accruing upon any Default shall impair any such right or remedy or constitute a waiver of any such Default or an acquiescence therein. Every right and
remedy given by this Article V or by law to the Indenture Trustee, any Swap Counterparty or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee, any Swap Counterparty or by the
Noteholders, as the case may be. 
  
 SECTION 5.11 Control by
Noteholders. The Noteholders of at least a majority of the Outstanding Amount of the Notes shall have the right to direct the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee with respect to
the Notes or exercising any trust or power conferred on the Indenture Trustee; provided that 
  
 (i) such direction shall not be in conflict with any rule of law or with this Indenture; 
  
 (ii) subject to the express terms of Section 5.4, any direction to the Indenture Trustee to sell or liquidate the Indenture Trust Estate shall be by the
Noteholders of not less than 100% of the Outstanding Amount of the Notes; 
  
 (iii) if the conditions set forth in Section 5.5 have been satisfied and the Indenture Trustee elects to retain the Indenture Trust Estate pursuant to such Section, then any direction to the Indenture Trustee by
Noteholders of less than 100% of the Outstanding Amount of the Notes to sell or liquidate the Indenture Trust Estate shall be of no force and effect; and 
  
  

 31 

 (iv) the Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not
inconsistent with such direction; 
  
 provided, however, that,
subject to Section 6.1, the Indenture Trustee need not take any action that it determines might involve it in liability or might materially adversely affect the rights of any Noteholders not consenting to such action. 
  
 SECTION 5.12 Waiver of Past Defaults. Prior to the time a judgment or
decree for payment of money due has been obtained as described in Section 5.2, the Noteholders of at least a majority of the Outstanding Amount of the Notes may waive any past Default and its consequences except a Default (a) in payment when due of
principal of or interest on any of the Notes or (b) in respect of a covenant or provision hereof which cannot be modified or amended without the consent of each Noteholder. In the case of any such waiver, the Issuer, the Indenture Trustee and the
Noteholders shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto. 
  
 Upon any such waiver, such Default shall cease to exist and be deemed to have
been cured and not to have occurred for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto. 
  
 SECTION 5.13 Undertaking for Costs. All parties to this Indenture agree, and each Noteholder by such
Noteholder’s acceptance of any Note shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any
action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable
attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of Noteholders, in each case holding in the aggregate more than 10% of the Outstanding Amount of the Notes or (c) any suit Instituted by any Noteholder for the enforcement of the
payment of principal of or interest on any Note on or after the respective due dates expressed in such Note and in this Indenture (or, in the case of redemption, on or after the Redemption Date). 
  
 SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any manner whatsoever, claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. 
  

 32 

 SECTION 5.15 Action on Notes. The Indenture Trustee’s right to seek and recover judgment on
the Notes or under this Indenture shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or
the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Indenture Trust Estate or upon any of the assets of the Issuer.
Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.4(b). 
  
 SECTION 5.16 Performance and Enforcement of Certain Obligations. 
  
 (a) Promptly following a request from the Indenture Trustee to do so and at the Administrator’s expense, the Issuer
shall take all such lawful action as the Indenture Trustee may request to compel or secure the performance and observance by the Depositor, SLM ECFC, VG Funding, the Administrator and the Servicer, as applicable, of each of their respective
obligations to the Issuer, whether directly or by assignment, under or in connection with the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase Agreement, the Administration Agreement and the Servicing Agreement, respectively,
in accordance with the terms thereof, and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under or in connection with the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase
Agreement, the Administration Agreement and the Servicing Agreement, as the case may be, to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default on the part of the Depositor, SLM ECFC, VG
Funding, the Administrator or the Servicer thereunder and the institution of legal or administrative actions or proceedings to compel or secure performance by the Depositor, SLM ECFC, VG Funding, the Administrator or the Servicer of each of their
obligations under the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase Agreement, the Administration Agreement and the Servicing Agreement, respectively. 
  
 (b) If an Event of Default has occurred and is continuing, the Indenture Trustee may, and at the written direction of the
Noteholders of 66-2/3% of the Outstanding Amount of the Notes shall, exercise all rights, remedies, powers, privileges and claims of the Issuer against the Depositor, SLM ECFC, VG Funding, the Administrator or the Servicer under or in connection
with the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase Agreement, the Administration Agreement and the Servicing Agreement, respectively, including the right or power to take any action to compel or secure performance or
observance by the Depositor, SLM ECFC, VG Funding, the Administrator or the Servicer of each of their obligations to the Issuer thereunder, whether directly or by assignment, and to give any consent, request, notice, direction, approval, extension
or waiver under the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase Agreement, the Administration Agreement and the Servicing Agreement, respectively, and any right of the Issuer to take such action shall be suspended.

  

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 ARTICLE VI 
  
 The Indenture Trustee 
  
 SECTION 6.1 Duties of Indenture Trustee. (a) If an Event of Default has occurred and is continuing, the Indenture Trustee shall exercise the rights
and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. 
  
 (b) Except during the continuance of an Event of Default: 
  
 (i) the Indenture Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee; and 
  
 (ii) in the absence of bad faith on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Indenture Trustee and conforming to the requirements of this Indenture; provided, however, that the Indenture Trustee shall examine
the certificates and opinions to determine whether or not they conform to the requirements of this Indenture. 
  
 (c) The Indenture Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct,
except that: 
  
 (i) this paragraph does not limit the effect of
paragraph (b) of this Section; 
  
 (ii) the Indenture Trustee
shall not be liable for any error of judgment made in good faith by a Responsible Officer unless it is proved that the Indenture Trustee was negligent in ascertaining the pertinent facts; and 
  
 (iii) the Indenture Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 5.11. 
  
 (d) The Indenture Trustee shall not be liable for interest on any money received by it except as the Indenture Trustee may agree in writing with the
Issuer. 
  
 (e) Money held in trust by the Indenture Trustee need
not be segregated from other funds except to the extent required by law or the terms of this Indenture or the other Basic Documents. 
  
 (f) No provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayments of such funds or adequate indemnity satisfactory to it against any loss, liability or
expense is not reasonably assured to it. 
  

 34 

 (g) Except as expressly provided in the Basic Documents, the Indenture Trustee shall have no obligation
to administer, service or collect the Trust Student Loans or to maintain, monitor or otherwise supervise the administration, servicing or collection of the Trust Student Loans. 
  
 (h) In the event that the Indenture Trustee is the Paying Agent or the Note Registrar, the rights and protections afforded
to the Indenture Trustee pursuant to this Indenture shall also be afforded to the Indenture Trustee in its capacity as Paying Agent or Note Registrar. 
  
 (i) Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA. 
  
 SECTION 6.2 Rights of Indenture Trustee. (a) The Indenture Trustee may rely on any document believed by it to be genuine and to have been signed or presented by the proper Person. The Indenture Trustee need not
investigate any fact or matter stated in such document. 
  
 (b)
Before the Indenture Trustee acts or refrains from acting, it may require and shall be entitled to receive an Officers’ Certificate of the Issuer and/or an Opinion of Counsel. The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel. 
  
 (c) The Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or
attorneys or a custodian or nominee, and the Indenture Trustee shall not be responsible for any misconduct or negligence on the part of, or for the supervision of, any such agent, attorney, custodian or nominee appointed with due care by it
hereunder. 
  
 (d) The Indenture Trustee shall not be liable for
any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers; provided, however, that the Indenture Trustee’s conduct does not constitute willful misconduct, negligence or
bad faith. 
  
 (e) The Indenture Trustee may consult with counsel,
and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Notes shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel. 
  
 SECTION 6.3 Individual Rights of Indenture Trustee. The Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying agent may do the same with like rights. However, the Indenture Trustee must comply with Sections 6.11 and
6.12. 
  
 SECTION 6.4 Indenture Trustee’s Disclaimer.
The Indenture Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or 

  

 35 

 
the Notes, it shall not be accountable for the Issuer’s use of the proceeds from the Notes, and it shall not be responsible for any statement of the
Issuer in the Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than the Indenture Trustee’s certificate of authentication. 
  
 SECTION 6.5 Notice of Defaults. If a Default occurs and is continuing and if it is either actually known or written
notice of the existence thereof has been delivered to a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall mail notice of the Default to each Noteholder and any Swap Counterparty within 90 days and to each Rating Agency as
soon as practicable within 30 days after it occurs. Except in the case of a Default in payment of principal of or interest on any Note (including payments pursuant to the mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Noteholders and any Swap Counterparty. Except as provided in the first sentence of this Section
6.5, in no event shall the Indenture Trustee be deemed to have knowledge of a Default or an Event of Default. 
  
 SECTION 6.6 Reports by Indenture Trustee to Noteholders. The Indenture Trustee shall deliver to each Noteholder (and to each Person who was a
Noteholder at any time during the applicable calendar year) such information as may be required to enable such holder to prepare its Federal and state income tax returns. Within 60 days after each December 31 beginning with the December 31 following
the date of this Indenture, the Indenture Trustee shall mail to each Noteholder a brief report as of such December 31 that complies with TIA § 313(a) if required by said section. The Indenture Trustee shall also comply with TIA § 313(b). A
copy of each such report required pursuant to TIA § 313(a) or (b) shall, at the time of such transaction to Noteholders, be filed by the Indenture Trustee with the Commission and with each securities exchange, if any, upon which the Notes are
listed, provided that the Issuer has previously notified the Indenture Trustee of such listing. 
  
 SECTION 6.7 Compensation and Indemnity. The Issuer shall cause the Depositor to pay to the Indenture Trustee reasonable compensation for its
services in accordance with a separate agreement between the Depositor and the Indenture Trustee and shall cause the Depositor to reimburse the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it as provided in such
separate agreement. The Indenture Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuer shall cause the Administrator to indemnify the Indenture Trustee and its directors, officers,
employees and agents against any and all loss, liability or expense (including attorneys’ fees) incurred by it in connection with the administration of this trust and the performance of its duties hereunder and under the other Basic Documents.
The Indenture Trustee shall notify the Issuer and the Administrator promptly of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and the Administrator shall not relieve the Issuer or the
Administrator of its obligations hereunder and under the other Basic Documents. The Issuer shall cause the Administrator to defend the claim and the Administrator shall not be liable for the legal fees and expenses of the Indenture Trustee after it
has assumed such defense; provided, however, that, in the event that there may be a conflict between the positions of the Indenture Trustee and the Administrator in conducting the defense of such claim, the Indenture Trustee shall be
entitled to separate counsel acceptable to it in its sole discretion the reasonable fees and 

  

 36 

 
expenses of which shall be paid by the Administrator on behalf of the Issuer. Neither the Issuer nor the Administrator need reimburse any expense or
indemnify against any loss, liability or expense incurred by the Indenture Trustee through the Indenture Trustee’s own willful misconduct, negligence or bad faith. 
  
 The Issuer’s payment obligations to the Indenture Trustee pursuant to this Section shall survive the discharge of this
Indenture. When the Indenture Trustee incurs expenses after the occurrence of a Default specified in Section 5.1(iv) or (v) with respect to the Issuer, the expenses are intended to constitute expenses of administration under Title 11 of the United
States Code or any other applicable Federal or state bankruptcy, insolvency or similar law. 
  
 SECTION 6.8 Replacement of Indenture Trustee. No resignation or removal of the Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective until the acceptance of appointment by
the successor Indenture Trustee pursuant to this Section 6.8. The Indenture Trustee may resign at any time by so notifying the Issuer. The Noteholders of at least a majority in Outstanding Amount of the Notes may remove the Indenture Trustee by so
notifying the Indenture Trustee and may appoint a successor Indenture Trustee. The Issuer shall remove the Indenture Trustee if: 
  
 (i) the Indenture Trustee fails to comply with Section 6.11; 
  
 (ii) an Insolvency Event occurs with respect to the Indenture Trustee; 
  
 (iii) a receiver or other public officer takes charge of the Indenture Trustee or its property; or 
  
 (iv) the Indenture Trustee otherwise becomes incapable of acting. 

 
 If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of Indenture Trustee for any reason (the Indenture Trustee in such event being referred to herein as the retiring Indenture Trustee), the Issuer shall promptly appoint a successor Indenture Trustee. 
  
 A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the
Indenture Trustee under this Indenture. The successor Indenture Trustee shall mail a notice of its succession to Noteholders. The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor
Indenture Trustee. 
  
 If a successor Indenture Trustee does not
take office within 60 days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuer or the Noteholders of at least a majority in Outstanding Amount of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee. The successor Indenture Trustee shall give notice of its appointment as successor Indenture Trustee to the Rating Agencies. 
  

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 If the Indenture Trustee fails to comply with Section 6.11, any Noteholder may petition any court of
competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee. 
  
 Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the Issuer’s and the Administrator’s obligations under
Section 6.7 shall continue for the benefit of the retiring Indenture Trustee. 
  
 SECTION 6.9 Successor Indenture Trustee by Merger. If the Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee, provided that such corporation or banking association shall be otherwise qualified and
eligible under Section 6.11. The Indenture Trustee shall provide the Rating Agencies prior written notice of any such transaction. 
  
 In case at the time such successor or successors by merger, conversion or consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Notes so authenticated; and in case
at that time any of the Notes shall not have been authenticated, any successor to the Indenture Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor to the Indenture Trustee; and in all
such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the Indenture Trustee shall have. 
  
 SECTION 6.10 Appointment of Co-Trustee or Separate Trustee. 
  
 (a) Notwithstanding any other provisions of this Indenture, at any time, for
the purpose of meeting any legal requirement of any jurisdiction in which any part of the Indenture Trust Estate may at the time be located, the Indenture Trustee shall have the power and may execute and deliver all instruments to appoint one or
more Persons to act as a co-trustee or co-trustees, or separate trustee or separate trustees, of all or any part of the Indenture Trust Estate, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders, such
title to the Indenture Trust Estate, or any part hereof, and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable. No such appointment
shall relieve the Indenture Trustee of its obligations hereunder. No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility as a successor trustee under Section 6.11 and no notice to Noteholders of the
appointment of any co-trustee or separate trustee shall be required under Section 6.8 hereof. 
  
 (b) Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: 
  
 (i) all rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed
upon and exercised or performed by the Indenture Trustee and such separate trustee or co-trustee jointly (it being understood that such 

  

 38 

 
separate trustee or co-trustee is not authorized to act separately without the Indenture Trustee joining in such act), except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding
of title to the Indenture Trust Estate or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Indenture Trustee; 
  
 (ii) no trustee hereunder shall be personally liable by reason of any act or
omission of any other trustee hereunder; and 
  
 (iii) the
Indenture Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee. 
  
 (c) Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article VI. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee. Every such instrument shall be filed with the Indenture Trustee. 
  
 (d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Indenture Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee. 
  
 SECTION 6.11 Eligibility;
Disqualification. The Indenture Trustee shall at all times satisfy the requirements of TIA § 310(a), the requirements of an “eligible lender” under 20 USC § 1085(d) and the requirements of Rule 3a-7(4)(i) of the General Rules
and Regulations under the Investment Company Act of 1940, as amended. The Indenture Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition and it shall have a
long-term senior unsecured debt rating of not less than investment grade by each of the Rating Agencies. The Indenture Trustee shall comply with TIA § 310(b), including the optional provision permitted by the second sentence of TIA §
310(b)(9); provided, however, that there shall be excluded from the operation of TIA § 310(b)(1) any indenture or indentures under which other securities of the Issuer are outstanding if the requirements for such exclusion set
forth in TIA § 310(b)(1) are met. 
  
 SECTION 6.12
Preferential Collection of Claims Against the Issuer. The Indenture Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). An Indenture Trustee who has resigned or been removed shall be
subject to TIA § 311(a) to the extent indicated. 
  
  

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 ARTICLE VII 
  
 Noteholders’ Lists and Reports 
  
 SECTION 7.1 Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders. The Issuer will furnish or cause to be furnished to the
Indenture Trustee (a) not more than five days after the earlier of (i) each Record Date and (ii) three months after the last Record Date, a list, in such form as the Indenture Trustee may reasonably require, of the names and addresses of the
Noteholders as of such Record Date, and (b) at such other times as the Indenture Trustee may request in writing, within 30 days after receipt by the Issuer of any such request, a list of similar form and content as of a date not more than 10 days
prior to the time such list is furnished; provided, however, that so long as the Indenture Trustee is the Note Registrar, no such list shall be required to be furnished. 
  
 SECTION 7.2 Preservation of Information; Communications to Noteholders. The Indenture Trustee shall preserve, in as
current a form as is reasonably practicable, the names and addresses of the Noteholders contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.1 and the names and addresses of Noteholders received by the
Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any list furnished to it as provided in such Section 7.1 upon receipt of a new list so furnished. 
  
 (a) Noteholders may communicate pursuant to TIA § 312(b) with other Noteholders with respect to their rights under this
Indenture or under the Notes. Upon receipt by the Indenture Trustee of any request by three or more Noteholders or by one or more holders of Notes evidencing not less than 25% of the Outstanding Amount of the Notes to receive a copy of the current
list of Noteholders (whether or not made pursuant to TIA § 312(b)), the Indenture Trustee shall promptly notify the Administrator thereof by providing to the Administrator a copy of such request and a copy of the list of Noteholders produced in
response thereto. 
  
 (b) The Issuer, the Indenture Trustee and
the Note Registrar shall have the protection of TIA § 312(c). 
  
 (c) On each Distribution Date the Indenture Trustee shall provide to each Noteholder of record as of the related Record Date the information provided by the Administrator to the Indenture Trustee on the related Determination Date pursuant
to Section 2.11 of the Administration Agreement. 
  
 (d) The
Indenture Trustee shall furnish to the Noteholders promptly upon receipt of a written request therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to the
Indenture Trustee under the Basic Documents. The Indenture Trustee shall furnish to the Noteholders promptly upon receipt thereof from the Eligible Lender Trustee notice of any amendment of the Administration Agreement pursuant to Section 8.5 of the
Administration Agreement. 
  

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 SECTION 7.3 Reports by Issuer. 
  
 (a) The Issuer shall: 
  
 (i) file with the Indenture Trustee, within 15 days after the Issuer is required to file the same with the Commission, copies of the annual reports and of
the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Issuer may be required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act; 
  
 (ii) file with the
Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission such additional information, documents and reports with respect to compliance by the Issuer with the conditions and
covenants of this Indenture as may be required from time to time by such rules and regulations; and 
  
 (iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA § 313(c)) such summaries
of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.3(a) as may be required by rules and regulations prescribed from time to time by the Commission. 
  
 (b) Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on December 31 of each year. 
  
 ARTICLE VIII 

 
 Accounts, Disbursements and Releases 
  
 SECTION 8.1 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable
by the Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply all such money received by it on behalf of Noteholders, any Swap Counterparty or the Trust pursuant to the Administration Agreement as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under any agreement or instrument that is part of the Indenture Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be without prejudice to any right to claim a Default under this Indenture and any right to proceed
thereafter as provided in Article V. 
  
 SECTION 8.2 Trust
Accounts. (a) On or prior to the Closing Date, the Issuer shall cause the Administrator to establish and maintain, in the name of the Indenture Trustee, for the benefit of the Noteholders, any Swap Counterparty and the Trust, the Trust Accounts
as provided in Section 2.3 of the Administration Agreement. 
  

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 (b) On or before the Business Day immediately preceding each Distribution Date, all Available Funds and
amounts set forth in paragraph (a)(2) of the definition of Available Funds with respect to the preceding Collection Period will be deposited in the Collection Account as provided in Section 2.4 of the Administration Agreement. On or before each
Distribution Date, the Indenture Trustee (or any other Paying Agent) shall make the required deposits and distributions as provided in Sections 2.7 and 2.8 of the Administration Agreement. 
  
 (c) During the Supplemental Purchase Period, the Indenture Trustee shall
withdraw funds as directed by the Administrator pursuant to Section 2.10(d) of the Administration Agreement for the purchase of Additional Trust Student Loans. 
  

(d) During the Consolidation Loan Add-On Period, the Indenture Trustee shall withdraw funds as directed by the Administrator pursuant to 2.10(e) of the
Administration Agreement for the funding of Add-On Consolidation Loans. 
  
 (e) On the Business Day immediately following the end of the Supplemental Purchase Period, the Indenture Trustee shall transfer any amounts remaining in the Supplemental Purchase Account at the end of the Supplemental Purchase Period into
the Collection Account, as directed by the Administrator. 
  
 (f)
On the Business Day immediately following the end of the Consolidation Loan Add-On Period, the Indenture Trustee shall transfer any amounts remaining in the Add-On Consolidation Loan Account into the Collection Account, as directed by the
Administrator. 
  
 SECTION 8.3 General Provisions Regarding
Accounts. (a) So long as no Default shall have occurred and be continuing, all or a portion of the funds in the Trust Accounts shall be invested in Eligible Investments and reinvested by the Indenture Trustee upon Issuer Order, subject to the
provisions of Section 2.3(b) of the Administration Agreement. All income or other gain from investments of moneys deposited in the Trust Accounts shall be deposited by the Indenture Trustee in the Collection Account, and any loss resulting from such
investments shall be charged to such Trust Account. The Issuer will not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in any of the Trust Accounts unless the security interest granted and perfected
in such account will continue to be perfected in such investment or the proceeds of such sale, in either case without any further action by any Person, and, in connection with any direction to the Indenture Trustee to make any such investment or
sale, if requested by the Indenture Trustee, the Issuer shall deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such effect. 
  
 (b) Subject to Section 6.1(c), the Indenture Trustee shall not in any way be held liable for the selection of Eligible
Investments or by reason of any insufficiency in any of the Trust Accounts resulting from any loss on any Eligible Investment included therein except for losses attributable to the Indenture Trustee’s failure to make payments on such Eligible
Investments issued by the Indenture Trustee, in its commercial capacity as principal obligor and not as trustee, in accordance with their terms. 
  
 (c) If (i) the Issuer shall have failed to give investment directions for any funds on deposit in the Trust Accounts to the Indenture Trustee by 10:00
a.m. Eastern Time (or such 

  

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other time as may be agreed by the Issuer and Indenture Trustee) on any Business Day; or (ii) a Default shall have occurred and be continuing with respect to
the Notes but the Notes shall not have been declared due and payable pursuant to Section 5.2, or, if such Notes shall have been declared due and payable following an Event of Default, amounts collected or receivable from the Indenture Trust Estate
are being applied in accordance with Section 5.5 as if there had not been such a declaration; then the Indenture Trustee shall invest and reinvest funds in the Trust Accounts in the Eligible Investments described in clause (d) of the definition
thereof. 
  
 SECTION 8.4 Release of Indenture Trust Estate.
(a) Subject to the payment of its fees and expenses pursuant to Section 6.7, the Indenture Trustee may, and when required by the provisions of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey
the Indenture Trustee’s interest in the same, in a manner and under circumstances that are not inconsistent with the provisions of this Indenture. No party relying upon an instrument executed by the Indenture Trustee as provided in this Article
VIII shall be bound to ascertain the Indenture Trustee’s authority, inquire into the satisfaction of any conditions precedent or see to the application of any moneys. 
  
 (b) The Indenture Trustee shall, at such time as there are no Notes Outstanding and all sums due the Indenture Trustee
pursuant to Section 6.7 have been paid, subject to the interest therein of any Swap Counterparty, release any remaining portion of the Indenture Trust Estate that secured the Notes from the lien of this Indenture and release to the Issuer or any
other Person entitled thereto any funds then on deposit in the Trust Accounts. The Indenture Trustee shall release property from the lien of this Indenture pursuant to this Section 8.4(b) only upon receipt of an Issuer Request accompanied by an
Officers’ Certificate of the Issuer, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance with TIA §§ 314(c) and 314(d)(1) meeting the applicable requirements of Section 11.1. 
  
 (c) Each Noteholder, by the acceptance of a Note, acknowledges that from time
to time the Indenture Trustee shall release the lien of this Indenture on any Trust Student Loan to be sold (i) to the Depositor in accordance with Section 6 of the Sale Agreement, (ii) to the Servicer in accordance with Section 3.5 of the Servicing
Agreement, (iii) to VG Funding (or the Seller from which VG Funding originally purchased such Trust Student Loan), to SLM ECFC or to another Affiliate of SLM Corporation in accordance with Section 3.11F. of the Servicing Agreement, (iv) to another
eligible lender holding one or more Serial Loans with respect to such Trust Student Loan, (v) to VG Funding in accordance with Section 6 of the VG Funding Purchase Agreement or (vi) to SLM ECFC in accordance with Section 6 of the SLM ECFC Purchase
Agreement, and each Noteholder, by the acceptance of a Note, consents to any such release. 
  
 SECTION 8.5 Opinion of Counsel. The Indenture Trustee shall receive at least seven days’ notice when requested by the Issuer to take any action pursuant to Section 8.4(a), accompanied by copies of any
instruments involved, and the Indenture Trustee shall also require, except in connection with any action contemplated by Section 8.4(c), as a condition to such action, an Opinion of Counsel, in form and substance satisfactory to the Indenture
Trustee, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not materially and
adversely impair the security for the Notes or the rights 

  

 43 

 
of the Noteholders or any Swap Counterparty in contravention of the provisions of this Indenture; provided, however, that such Opinion of
Counsel shall not be required to express an opinion as to the fair value of the Indenture Trust Estate. Counsel rendering any such opinion may rely, without independent investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such action. 
  
 ARTICLE IX 
  
 Supplemental
Indentures 
  
 SECTION 9.1 Supplemental Indentures Without
Consent of Noteholders. 
  
 (a) Without the consent of any
Noteholders but with prior notice to the Rating Agencies, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures supplemental hereto (which shall conform to
the provisions of the Trust Indenture Act as in force at the date of the execution thereof), in form satisfactory to the Indenture Trustee, for any of the following purposes: 
  
 (i) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to
assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture, or to subject to the lien of this Indenture additional property; 
  
 (ii) to evidence the succession, in compliance with the applicable provisions
hereof, of another person to the Issuer, and the assumption by any such successor of the covenants of the Issuer herein and in the Notes contained; 
  
 (iii) to add to the covenants of the Issuer, for the benefit of the Noteholders and, any Swap Counterparty, as applicable, or to surrender any right or
power herein conferred upon the Issuer; 
  
 (iv) to convey,
transfer, assign, mortgage or pledge any property to the Indenture Trustee; 
  
 (v) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture which may be inconsistent with any other provision herein or in any supplemental indenture or to make any other
provisions with respect to matters or questions arising under this Indenture or in any supplemental indenture; provided that such action shall not materially adversely affect the interests of the Noteholders or any Swap Counterparty; 
  
 (vi) to evidence and provide for the acceptance of the appointment hereunder
by a successor trustee with respect to the Notes and to add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one trustee, pursuant to the requirements of
Article VI; or 
  
 (vii) to modify, eliminate or add to the
provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the TIA or under any similar Federal statute hereafter enacted and to add to this Indenture such other provisions as may be
expressly required by the TIA. 
  
  

 44 

 The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture
and to make any further appropriate agreements and stipulations that may be therein contained. 
  
 (b) The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any of the Noteholders but with prior notice to any Swap Counterparty and the Rating Agencies, enter into
an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Noteholders or any Swap
Counterparty under this Indenture; provided, however, that such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Noteholder or any Swap Counterparty. 
  
 SECTION 9.2 Supplemental Indentures with Consent of Noteholders.

  
 (a) The Issuer and the Indenture Trustee, when authorized by
an Issuer Order, also may, with prior notice to any Swap Counterparty and the Rating Agencies and with the consent of the Noteholders of at least a majority of the Outstanding Amount of the Notes, by Act of such Noteholders delivered to the Issuer
and the Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the
rights of the Noteholders under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Noteholder of each Outstanding Note affected thereby: 
  
 (i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the interest rate thereon or the Redemption Price with respect thereto, change the provisions of this Indenture relating to the application of collections on, or the proceeds of the sale
of, the Indenture Trust Estate to payment of principal of or interest on the Notes, or change any place of payment where, or the coin or currency in which, any Note or the interest thereon is payable (other than pursuant to the terms and conditions
of the Reset Rate Notes or pursuant to the Reset Rate Note Procedures set forth in Appendix A-2 to this Indenture) or impair the right to institute suit for the enforcement of the provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date); 
  
 (ii) reduce the percentage of the Outstanding Amount of the Notes, the
consent of the Noteholders of which is required for any such supplemental indenture, or the consent of the Noteholders of which is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and
their consequences provided for in this Indenture; 
  

 45 

 (iii) modify or alter the provisions of the proviso to the definition of the term
“Outstanding”; 
  
 (iv) reduce the percentage of the
Outstanding Amount of the Notes required to direct the Indenture Trustee to direct the Issuer to sell or liquidate the Indenture Trust Estate pursuant to Section 5.4; 
  
 (v) modify any provision of this Section except to increase any percentage specified herein or to provide that certain
additional provisions of this Indenture or the other Basic Documents cannot be modified or waived without the consent of the Noteholder of each Outstanding Note affected thereby; 
  
 (vi) modify any of the provisions of this Indenture in such manner as to affect the calculation of the amount of any payment
of interest or principal due on any Note on any Distribution Date (including the calculation of any of the individual components of such calculation) or to affect the rights of the Noteholders to the benefit of any provisions for the mandatory
redemption of the Notes contained herein; or 
  
 (vii) permit the
creation of any lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Indenture Trust Estate or, except as otherwise permitted or contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive any Noteholder of any Note of the security provided by the lien of this Indenture; 
  
 provided, however, that such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Swap
Counterparty. 
  
 It shall not be necessary for any Act of
Noteholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. 
  
 Promptly after the execution by the Issuer and the Indenture Trustee of any supplemental indenture pursuant to this Section,
the Indenture Trustee shall mail to the Noteholders of the Notes to which such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental indenture. Any failure of the Indenture Trustee to
mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. 
  
 SECTION 9.3 Execution of Supplemental Indentures. In executing, or permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and subject to Sections 6.1 and 6.2, shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture
Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise. 
  

 46 

 SECTION 9.4 Effect of Supplemental Indenture. Upon the execution of any supplemental indenture
pursuant to the provisions hereof, this Indenture shall be and be deemed to be modified and amended in accordance therewith with respect to the Notes affected thereby, and the respective rights, limitations of rights, obligations, duties,
liabilities and immunities under this Indenture of the Indenture Trustee, the Issuer and the Noteholders shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. 
  
 SECTION 9.5 Conformity with Trust Indenture Act. Every amendment of this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then in effect so long as this Indenture shall then be qualified under the Trust Indenture Act. 
  
 SECTION 9.6 Reference in Notes to Supplemental Indentures. Notes authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article IX may, and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in the opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes. 
  
 ARTICLE X

  
 Redemption of Notes 
  
 SECTION 10.1 Redemption. The Indenture Trustee shall, upon receipt of
written notice from the Servicer pursuant to Section 6.1(b) of the Administration Agreement, give prompt written notice to the Noteholders of the occurrence of such event. In the event that the assets of the Trust are sold pursuant to Section 6.1(a)
of the Administration Agreement, that portion of the amounts on deposit in the Trust Accounts to be distributed to the Noteholders shall be paid to the Noteholders as provided in Sections 2.7 and 2.8 of the Administration Agreement. If amounts are
to be paid to Noteholders pursuant to this Section 10.1, the notice of such event from the Indenture Trustee to the Noteholders shall include notice of the redemption of Notes by application of such amounts on the next Distribution Date which is not
sooner than 15 days after the date of such notice (the “Redemption Date”), whereupon all such amounts shall be payable on the Redemption Date. 
  
 SECTION 10.2 Form of Redemption Notice. Notice of redemption under Section 10.1 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile, mailed or transmitted on or prior to the applicable Redemption Date to each Noteholder, as of the close of business on the Record Date preceding the applicable Redemption Date, at such Noteholder’s address or
facsimile number appearing in the Note Register. 
  
  

 47 

 All notices of redemption shall state: 
  
 (i) the Redemption Date; 
  
 (ii) the Redemption Price; and 
  
 (iii) the place where such Notes are to be surrendered for payment of the Redemption Price (which shall be the office or agency of the Issuer to be
maintained as provided in Section 3.2). 
  
 Notice of redemption
of the Notes shall be given by the Indenture Trustee in the name and at the expense of the Issuer. Failure to give notice of redemption, or any defect therein, to any Noteholder of any Note shall not impair or affect the validity of the redemption
of any other Note. 
  
 SECTION 10.3 Notes Payable on Redemption
Date. The Notes or portions thereof to be redeemed shall on the Redemption Date become due and payable at the Redemption Price and (unless the Issuer shall default in the payment of the Redemption Price) no interest shall accrue on the
Redemption Price for any period after the date to which accrued interest is calculated for purposes of calculating the Redemption Price. 
  
 ARTICLE XI  
  
 Miscellaneous 
  
 SECTION 11.1 Compliance Certificates and Opinions, etc. (a) Upon any application or request by the Issuer to the Indenture Trustee to take any action under any provision of this Indenture, the Issuer shall
furnish to the Indenture Trustee and the Rating Agencies (i) an Officers’ Certificate of the Issuer stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required by the TIA) an Independent Certificate from a firm of certified public accountants meeting the
applicable requirements of this Section, except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need
be furnished. 
  
 Every certificate or opinion with respect to
compliance with a condition or covenant provided for in this indenture shall include: 
  
 (i) a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto; 
  
 (ii) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such certificate or opinion are based; 
  
 (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 
  
  

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 (iv) a statement as to whether, in the opinion of each such signatory, such condition or covenant has
been complied with. 
  
 (b) (i) Prior to the deposit of any
Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release of any property or securities subject to the lien of this Indenture, the Issuer shall, in addition to any obligation imposed in
Section 11.1(a) or elsewhere in this Indenture, furnish to the Indenture Trustee and the Rating Agencies an Officers’ Certificate of the Issuer certifying or stating the opinion of each person signing such certificate as to the fair value
(within 90 days of such deposit) to the Issuer of the Collateral or other property or securities to be so deposited. 
  
 (ii) Whenever the Issuer is required to furnish to the Indenture Trustee and the Rating Agencies an Officers’ Certificate of the Issuer certifying or
stating the opinion of any signer thereof as to the matters described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an Independent Certificate as to the same matters, if the fair value to the Issuer of the securities to
be so deposited and of all other such securities made the basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuer, as set forth in the certificates delivered pursuant to clause (i) above and this
clause (ii), is 10% or more of the Outstanding Amount of the Notes, but such a certificate need not be furnished with respect to any securities so deposited, if the fair value thereof to the Issuer as set forth in the related Officers’
Certificate is less than $25,000 or less than one percent of the Outstanding Amount of the Notes. 
  
 (iii) Other than any property released as contemplated by clause (v) below, whenever any property or securities are to be released from the lien of this
Indenture, the Issuer shall also furnish to the Indenture Trustee an Officers’ Certificate of the Issuer certifying or stating the opinion of each person signing such certificate as to the fair value (within 90 days of such release) of the
property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security under this Indenture in contravention of the provisions hereof. 
  
 (iv) Whenever the Issuer is required to furnish to the Indenture Trustee an
Officers’ Certificate of the Issuer certifying or stating the opinion of any signer thereof as to the matters described in clause (iii) above, the Issuer shall also furnish to the Indenture Trustee an Independent Certificate as to the same
matters if the fair value of the property or securities and of all other property, other than property as contemplated by clause (v) below, or securities released from the lien of this Indenture since the commencement of the then-current calendar
year, as set forth in the certificates required by clause (iii) above and this clause (iv), equals 10% or more of the Outstanding Amount of the Notes, but such certificate need not be furnished in the case of any release of property or securities if
the fair value thereof as set forth in the related Officers’ Certificate is less than $25,000 or less than one percent of the then Outstanding Amount of the Notes. 
  

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 (v) Notwithstanding Section 2.9 or any other provision of this Section, the Issuer may, without
compliance with the requirements of the other provisions of this Section, (A) collect, liquidate, sell or otherwise dispose of Trust Student Loans as and to the extent permitted or required by the Basic Documents, (B) make cash payments out of the
Trust Accounts as and to the extent permitted or required by the Basic Documents and (C) convey to the Depositor, the Servicer or another eligible lender those specified Trust Student Loans as and to the extent permitted or required by and in
accordance with Section 8.4(c) hereof and Section 6 of the Sale Agreement, Section 3.5 of the Servicing Agreement or Section 3.11E of the Servicing Agreement, respectively, so long as the Issuer shall deliver to the Indenture Trustee every six
months, commencing December 31, 2005, an Officers’ Certificate of the Issuer stating that all the dispositions of Collateral described in clauses (A), (B) or (C) above that occurred during the immediately preceding six calendar months were in
the ordinary course of the Issuer’s business and that the proceeds thereof were applied in accordance with the Basic Documents. 
  
 SECTION 11.2 Form of Documents Delivered to Indenture Trustee. In any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters, and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. 
  
 Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with
respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Servicer, the Depositor, the Issuer or the Administrator, stating that the information with respect to such factual matters is in the possession of the Servicer, the Depositor, the Issuer or the
Administrator, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. 
  
 Where any Person is required to make, give or execute two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. 
  
 Whenever in this Indenture, in connection with any application or certificate or report to the Indenture Trustee, it is provided that the Issuer shall
deliver any document as a condition of the granting of such application, or as evidence of the Issuer’s compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the
effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuer to have such application granted or to the sufficiency of such
certificate or report. The foregoing shall not, however, be construed to affect the Indenture Trustee’s right to rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in Article VI. 

 
  

 50 

 SECTION 11.3 Acts of Noteholders. (a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by agents duly
appointed in writing; and except as herein otherwise expressly provided such action shall become effective when such instrument or instruments are delivered to the Indenture Trustee, and, where it is hereby expressly required, to the Issuer. Such
instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.1) conclusive in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section. 
  
 (b) The fact and date of the execution by any person of any such instrument
or writing may be proved in any manner that the Indenture Trustee deems sufficient. 
  
 (c) The ownership of Notes shall be proved by the Note Register. 
  
 (d) Any request, demand, authorization, direction, notice, consent, waiver or other action by any Noteholder shall bind the Noteholder of every Note
issued upon registration of transfer thereof or in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action
is made upon such Note. 
  
 SECTION 11.4 Notices, etc., to
Indenture Trustee, Issuer and Rating Agencies. Any request, demand, authorization, direction, notice, consent, waiver or Act of Noteholders or other documents provided or permitted by this Indenture shall be in writing and if such request,
demand, authorization, direction, notice, consent, waiver or Act of Noteholders is to be made upon, given or furnished to or filed with: 
  
 (a) The Indenture Trustee by any Noteholder, the Servicer, the Administrator or by the Issuer shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the Indenture Trustee at its Corporate Trust Office with a copy to: Deutsche Bank Trust Company Americas, 60 Wall Street, 26th Floor, Mailstop NYC 60-2606, New York, New York 10005, Attention: Trust & Securities Services/Structured Finance Services. 
  
 (b) The Issuer by the Indenture Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if in writing and mailed, first-class, postage prepaid, to the Issuer addressed to: SLM Student Loan Trust 2005-5, in care of Chase Bank USA, National Association, Christiana Center/OPS4, 500 Stanton Christiana
Road, Newark, Delaware 19713, Attention: Corporate Trust Department; with copies to JPMorgan Chase Bank, N.A., 450 West 33rd Street 15th Fl., New York, New York 10001, Attention: Structured Finance Services; and the Administrator, 12061 Bluemont
Way, V3419, Reston, Virginia, 20190, Attention: ABS Trust Administration, or any other address previously furnished in writing to the Indenture Trustee by the Issuer or the Administrator. The Issuer shall promptly transmit any notice received by it
from the Noteholders to the Indenture Trustee. 
  
  

 51 

 Notices required to be given to the Rating Agencies by the Issuer, the Indenture Trustee or the Eligible
Lender Trustee shall be in writing, personally delivered or mailed by certified mail, return receipt requested, to (i) in the case of Moody’s, at the following address: ABS Monitoring Department, 99 Church Street, New York, New York 10007, (ii)
in the case of S&P, at the following address: 55 Water Street, New York, New York 10041-0003, Attention: Asset Backed Surveillance Department, 32nd Floor, and (iii) in the case of Fitch, at the following address: One State Street Plaza, New
York, New York 10004, Attention: Municipal Structured Finance Group; or as to each of the foregoing, at such other address as shall be designated by written notice to the other parties. 
  
 Notices to any Swap Counterparty shall be sent to the addresses set forth in the related Swap Agreement, respectively or
such other addresses as may be designated by written notice to the parties to this Indenture. 
  
 SECTION 11.5 Notices to Noteholders; Waiver. Where this Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class, postage prepaid to each Noteholder affected by such event, at his address as it appears on the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice nor any defect in any notice so mailed to any particular Noteholder shall affect the sufficiency of such notice with respect to other
Noteholders, and any notice that is mailed in the manner herein provided shall conclusively be presumed to have been duly given. 
  
 Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance
upon such a waiver. 
  
 In case, by reason of the suspension of
regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner
of giving such notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving of such notice. 
  
 Where this Indenture provides for notice to the Rating Agencies, failure to give such notice shall not affect any other rights or obligations created
hereunder, and shall not under any circumstance constitute a Default. 
  
 SECTION 11.6 Alternate Payment and Notice Provisions. Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuer may enter into any agreement with any Noteholder providing for a method of payment,
or notice by the Indenture Trustee or any Paying Agent to such Noteholder, that is different from the methods provided for 

  

 52 

 
in this Indenture for such payments or notices. The Issuer will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will
cause payments to be made and notices to be given in accordance with such agreements. 
  
 SECTION 11.7 Conflict with Trust Indenture Act. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this Indenture by any of the provisions of
the Trust Indenture Act, such required provision shall control. 
  
 The provisions of TIA §§ 310 through 317 that impose duties on any Person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether
or not physically contained herein. 
  
 SECTION 11.8 Effect of
Headings and Table of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. 
  
 SECTION 11.9 Successors and Assigns. All covenants and agreements in this Indenture and the Notes by the Issuer shall
bind its successor and assigns, whether so expressed or not. All agreements of the Indenture Trustee in this Indenture shall bind the successors, co-trustees and agents (excluding any legal representatives or accountants) of the Indenture Trustee.

  
 SECTION 11.10 Separability. In case any provision in
this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 
  
 SECTION 11.11 Benefits of Indenture. (a) Except as set forth in
paragraphs (b) and (c) below, nothing in this Indenture or in the Notes, express or implied shall give to any person, other than the parties hereto and their successors hereunder, the Noteholders, any other party secured hereunder, and any other
Person with an ownership interest in any part of the Indenture Trust Estate, any benefit or any legal or equitable right, remedy or claim under this Indenture. 
  

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

(c) The parties to this Indenture acknowledge and agree that SLM Corporation, and any permitted transferee, if applicable, is an intended third party
beneficiary of this Indenture to the extent of its rights with respect to the Call Option as set forth in Section 7 of Appendix A-2 hereto and shall be entitled to enforce such rights. 
  
 SECTION 11.12 Legal Holidays. In any case where the date on which any payment is due shall not be a Business Day,
then (notwithstanding any other provision of the Notes or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date on which nominally due, and no
interest shall accrue for the period from and after any such nominal date. 
  

 53 

 SECTION 11.13 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN §5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS. 
  
 SECTION 11.14 Counterparts. This
Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. 
  
 SECTION 11.15 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be effected by the Issuer and at its expense accompanied by an Opinion of Counsel (which may be counsel to the Indenture Trustee or any other counsel reasonably acceptable
to the Indenture Trustee) to the effect that such recording is necessary either for the protection of the Noteholders or any other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee under this
Indenture. 
  
 SECTION 11.16 Trust Obligations. No recourse
may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Depositor, the Administrator, the Servicer, the Eligible Lender Trustee or the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the Indenture Trustee or the Eligible Lender Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director or employee of the Indenture Trustee or the Eligible Lender Trustee in its individual capacity, any holder or owner of a beneficial interest in the Issuer, the Eligible Lender Trustee or the Indenture Trustee or of any
successor or assign thereof in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Eligible Lender Trustee have no such obligations in their individual capacity) and
except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity.
For all purposes of this Indenture, in the performance of any duties or obligations of the Issuer hereunder, the Eligible Lender Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles VI, VII and VIII of
the Trust Agreement. 
  
 SECTION 11.17 No Petition. The
Indenture Trustee, by entering into this Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they shall not at any time institute against the Depositor or the Issuer, or join in any institution against the Depositor
or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation proceedings, or other proceedings under any United States Federal or state bankruptcy or similar law in connection with any obligations relating
to the Notes, this Indenture or any of the other Basic Documents. The foregoing shall not limit the rights of the Indenture Trustee to file any claim in, or otherwise take any action with respect to, any insolvency proceeding that was instituted
against the Issuer by any Person other than the Indenture Trustee. 
  
  

 54 

 SECTION 11.18 Inspection. The Issuer agrees that, on reasonable prior notice, it shall permit any
representative of the Indenture Trustee, during the Issuer’s normal business hours, to examine all the books of account, records, reports, and other papers of the Issuer, to make copies and extracts therefrom, to cause such books to be audited
by Independent certified public accountants, and to discuss the Issuer’s affairs, finances and accounts with the Issuer’s officers, employees, and Independent certified public accountants, all at such reasonable times and as often as may
be reasonably requested. The Indenture Trustee shall and shall cause its representatives to hold in confidence all such information obtained from such examination or inspection except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to the extent that the Indenture Trustee may reasonably determine that such disclosure is consistent with its obligations hereunder. 
  
 SECTION 11.19 Subordination. All rights and interest of any Currency
Swap Counterparty in the security interest granted to the Indenture Trustee under this Indenture shall be fully subordinated to the interests of the Noteholders. No Currency Swap Counterparty shall have any rights, implied or otherwise, in the
Collateral until after the Outstanding Amount of the Notes has been reduced to zero and the Noteholders have been paid all amounts owed to them under this Indenture. Notwithstanding the foregoing, the provisions of this Section 11.19 shall not
modify or otherwise affect the contractual priority of payments set forth in Section 5.4(b) hereof or Section 2.8 of the Administration Agreement. More specifically, no Currency Swap Counterparty shall have any voting rights or rights to exercise
any remedies under this Indenture until after the Outstanding Amount of the Notes has been reduced to zero and the Noteholders have been paid all amounts owed to them under this Indenture. After the Outstanding Amount of the Notes has been reduced
to zero and the Noteholders have been paid all amounts owed to them under this Indenture, each Currency Swap Counterparty shall have all of the rights and obligations, including all voting rights, of the Noteholders set forth in this Indenture.

  
  

 55 

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

			
	SLM STUDENT LOAN TRUST 2005-5
	
	 By: CHASE BANK USA, NATIONAL ASSOCIATION,
 not in its individual capacity
 but solely as Eligible Lender Trustee

		
	By:	 	 /S/ JOHN J. CASHIN

	Name:	 	John J. Cashin
	Title:	 	Vice President
	
	 CHASE BANK USA, NATIONAL ASSOCIATION,
 not in
its individual capacity
 but solely as Eligible Lender Trustee

		
	By:	 	 /S/ JOHN J. CASHIN

	Name:	 	John J. Cashin
	Title:	 	Vice President
	
	DEUTSCHE BANK TRUST COMPANY AMERICAS,
	 not in its individual capacity
 but solely as
Indenture Trustee

		
	By:	 	 /S/ MICHELE H.Y. VOON

	Name:	 	Michele H.Y. Voon
	Title:	 	Assistant Vice President

  

 56 

 APPENDIX A-1 
  
 DEFINITIONS AND USAGE 
 Series 2005-5 
  
 Usage 
  
 The following rules of
construction and usage shall be applicable to any instrument that is governed by this appendix (this “Appendix”): 
  
 (a) All terms defined in this Appendix shall have the defined meanings when used in any instrument governed hereby and in any certificate or other
document made or delivered pursuant thereto unless otherwise defined therein. 
  
 (b) As used herein, in any instrument governed hereby and in any certificate or other document made or delivered pursuant thereto, accounting terms not defined in this Appendix or in any such instrument, certificate
or other document, and accounting terms partly defined in this Appendix or in any such instrument, certificate or other document, to the extent not defined, shall have the respective meanings given to them under generally accepted accounting
principles as in effect on the date of such instrument. To the extent that the definitions of accounting terms in this Appendix or in any such instrument, certificate or other document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Appendix or in any such instrument, certificate or other document shall control. 
  
 (c) The words “hereof,” “herein,” “hereunder” and words of similar import when used in an instrument refer to such
instrument as a whole and not to any particular provision or subdivision thereof; references in an instrument to “Article,” “Section” or another subdivision or to an attachment are, unless the context otherwise requires, to an
article, section or subdivision of or an attachment to such instrument; and the term “including” means “including without limitation.” 
  
 (d) The definitions contained in this Appendix are equally applicable to both the singular and plural forms of such terms and to the masculine as well as
to the feminine and neuter genders of such terms. 
  
 (e) Any
agreement, instrument or statute defined or referred to below or any agreement or instrument that is governed by this Appendix means such agreement or instrument or statute as from time to time amended, modified or supplemented, including (in the
case of agreements or instruments) by assignment, assumption, waiver or consent and (in the case of statutes) by succession of comparable successor statutes and includes (in the case of agreements or instruments) references to all attachments
thereto and instruments incorporated therein. References to a Person are also to its permitted successors and assigns. 
  
 (f) All dollar amounts calculated hereunder shall be rounded to the nearest penny with one-half of one penny, pence, cent, or other equivalent currency
unit. 
  

 Appendix 1-1 

 “30/360” means that interest is calculated on the basis of a 360-day year consisting of
twelve 30-day months. 
  
 “91-day Treasury Bill
Rate” means, for any relevant Interest Rate Determination Date, prior to each Interest Rate Change Date, the rate equal to the weighted average per annum discount rate (expressed as a bond equivalent yield and applied on a daily basis) for
direct obligations of the United States with a maturity of thirteen weeks (“91-day Treasury Bills”) sold at the applicable 91-day Treasury Bill auction, as published in H.15(519) or otherwise or as reported by the U.S. Department of the
Treasury. In the event that the results of the auctions of 91-day Treasury Bills cease to be published or reported as provided above, or that no 91-day Treasury Bill auction is held in a particular week, then the 91-day Treasury Bill Rate in effect
as a result of the last such publication or report will remain in effect until such time, if any, as the results of auctions of 91-day Treasury Bills will again be so published or reported or such auction is held, as the case may be. The 91-day
Treasury Bill Rate will be subject to a Lock-In Period of six Business Days. 
  
 “Accrual Period” means, with respect to a Distribution Date and (i) each class of Notes bearing a floating rate of interest (including, without limitation, the Floating Rate Notes and the Reset Rate
Notes during their initial Accrual Period), the period from and including the immediately preceding Distribution Date for such class of Notes to but excluding the then-current Distribution Date, or in the case of the initial such period for such
class of Notes, the period from and including the Closing Date to and including October 24, 2005; provided that if more than one Interest Rate Change Date occurs for the Reset Rate Notes while bearing a floating rate of interest within any
given Accrual Period, the rate of interest for the entire Accrual Period shall be as specified in the relevant Remarketing Terms Notice; and (ii) the Reset Rate Notes if they bear a fixed rate of interest and (x) are denominated in U.S. Dollars, the
period from and including the 25th day of the month of the last applicable Distribution Date, to and including the
24th day of the month of the then-current applicable Distribution Date for the Reset Rate Notes, or (y) are
denominated in a currency other than U.S. Dollars, (A) the period from and including the 25th day of the month of
the last applicable Distribution Date, to and including the 24th day of the month of the then-current applicable
Distribution Date or (B) as otherwise specified on the Schedule A for the Reset Rate Notes. 
  
 “Accumulation Account” means each account designated as such, established and maintained pursuant to Section 2.3(j) of the Administration Agreement. 
  
 “Act” means the Securities Act of 1933, as amended.

  
 “Actual/360” means that interest is
calculated on the basis of the actual number of days elapsed in a year of 360 days. 
  
 “Actual/365 (fixed)” means that interest is calculated on the basis of the actual number of days elapsed in a year of 365 days, regardless of whether accrual or payment occurs in a leap year.

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

 Appendix 1-2 

 “Actual/Actual (ISMA)” means a calculation in accordance with the definition of
“Actual/Actual” adopted by the International Securities Market Association (“ISMA”), which means that interest is calculated on the following basis: 
  
 (1) where the number of days in the relevant Accrual Period is equal to or shorter than the Determination
Period during which such Accrual Period ends, the number of days in such Accrual Period divided by the product of (A) the number of days in such Determination Period and (B) the number of Distribution Dates that would occur in one calendar year; or

  
 (2) where the Accrual Period is longer than
the Determination Period during which the Accrual Period ends, the sum of: 
  
 (A) the number of days in such Accrual Period falling in the Determination Period in which the Accrual Period begins divided by the product of (x) the number of days in such Determination Period and (y) the number of
Distribution Dates that would occur in one calendar year; and 
  
 (B) the number of days in such Accrual Period falling in the next Determination Period divided by the product of (x) the number of days in such Determination Period and (y) the number of Distribution Dates that would
occur in one calendar year; 
  
 where “Determination Period” means the
period from and including one Calculation Date to but excluding the next Calculation Date and “Calculation Date” means, in each year, each of those days in the calendar year that are specified herein as being the scheduled Distribution
Dates. 
  
 “Actual/Actual (payment basis)” means
that interest is calculated on the basis of the actual number of days elapsed in a year of 365 days if the interest period ends in a non-leap year, or 366 days if the interest period ends in a leap year, as the case may be. 
  
 “Add-On Consolidation Loan” means an eligible education
loan, which, pursuant to the Higher Education Act and at the election of the borrower, is added to such borrower’s existing Consolidation Loan. 
  
 “Add-On Consolidation Loan Account” means an account designated as such, established and maintained pursuant to Section 2.3(a) of the
Administration Agreement. 
  
 “Add-On Consolidation Loan
Account Initial Deposit” means $10,000,000. 
  
 “Additional Bill of Sale” has the meaning specified in each of the Purchase Agreements or the Sale Agreement, as applicable. 
  
 “Additional Purchase Agreement” has the meaning specified in each of the Purchase Agreements, as applicable. 
  
 “Additional Sale Agreement” has the meaning specified in the
Sale Agreement. 
  

 Appendix 1-3 

 “Additional Trust Student Loan” means each Eligible Loan purchased by the Trust during
the Supplemental Purchase Period from the Depositor pursuant to Section 3.2 of the Sale Agreement and each related Additional Sale Agreement. 
  
 “Adjusted Pool Balance” means, for any Distribution Date, (a) if the Pool Balance as of the last day of the related Collection Period is
greater than 40% of the Initial Pool Balance, the sum of that Pool Balance, Capitalized Interest, the amount, if any, on deposit in the Add-On Consolidation Loan Account (excluding amounts in such account that will become Available Funds on the next
Distribution Date) and the Specified Reserve Account Balance for that Distribution Date, or (b) if the Pool Balance as of the last day of the related Collection Period is less than or equal to 40% of the Initial Pool Balance, the sum of that Pool
Balance and Capitalized Interest. 
  
 “Administration
Agreement” means the Administration Agreement, dated as of June 29, 2005, among the Administrator, the Servicer, the Depositor, the Trust and the Eligible Lender Trustee. 
  
 “Administration Fees” has the meaning specified in Section 2.14 of the Administration Agreement.

  
 “Administrator” means Sallie Mae, Inc., in
its capacity as administrator of the Trust in accordance with the Administration Agreement. 
  
 “Administrator Default” has the meaning specified in Section 5.1 of the Administration Agreement. 
  
 “Administrator’s Certificate” means an Officers’ Certificate of the Administrator delivered pursuant to Section 3.1(c) of the
Administration Agreement. 
  
 “Administrator’s
Officers’ Certificate” means any Officers’ Certificate of the Administrator delivered pursuant to Section 3.1(b) of the Administration Agreement. 
  
 “Affiliate” means, with respect to any specified Person, any other Person controlling or controlled by or
under common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. 
  
 “All Hold Rate” means, if the Reset Rate Notes are denominated in U.S. Dollars during the then-current
Reset Period and the immediately following Reset Period, the applicable Index plus or minus the applicable Spread (if the Reset Rate Notes are in floating rate mode) or the applicable fixed rate, which may be expressed as the fixed rate pricing
benchmark plus or minus a spread (if the Reset Rate Notes are in fixed rate mode), that the Remarketing Agents, in consultation with the Administrator, determine will be effective, unless the Call Option is exercised, in the event that 100% of the
holders of the Reset Rate Notes choose to hold their Notes for the upcoming Reset Period. The All Hold Rate shall be a rate that the Remarketing Agents, in consultation with the Administrator, and in their good faith determination, believe would
result in the remarketing of all of the Reset Rate Notes at a price equal to 100% of the Outstanding Amount thereof. 
  

 Appendix 1-4 

 “Authenticating Agents” means any agent subsequently appointed with respect to the Reset
Rate Notes and/or JPMorgan Chase Bank, in respect of the Excess Distribution Certificate. 
  
 “Authorized Officer” means (i) with respect to the Trust, any officer of the Eligible Lender Trustee who is authorized to act for the Eligible Lender Trustee in matters relating to the Trust pursuant
to the Basic Documents and who is identified on the list of Authorized Officers delivered by the Eligible Lender Trustee to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter), (ii)
with respect to the Administrator, any officer of the Administrator or any of its Affiliates who is authorized to act for the Administrator in matters relating to itself or to the Trust and to be acted upon by the Administrator pursuant to the Basic
Documents and who is identified on the list of Authorized Officers delivered by the Administrator to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter), (iii) with respect to the
Depositor, any officer of the Depositor or any of its Affiliates who is authorized to act for the Depositor in matters relating to or to be acted upon by the Depositor pursuant to the Basic Documents and who is identified on the list of Authorized
Officers delivered by the Depositor to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter) and (iv) with respect to the Servicer, any officer of the Servicer who is authorized to act
for the Servicer in matters relating to or to be acted upon by the Servicer pursuant to the Basic Documents and who is identified on the list of Authorized Officers delivered by the Servicer to the Indenture Trustee on the Closing Date (as such list
may be modified or supplemented from time to time thereafter). 
  
 “Available Funds” means, as to a Distribution Date or any related Monthly Servicing Payment Date, the sum of the following amounts received with respect to the related Collection Period or, in the case of a Monthly
Servicing Payment Date, the applicable portion of these amounts: 
  
 (a) all collections received by the Servicer on the Trust Student Loans, including any Guarantee Payments received on the Trust Student Loans, but net of: 
  
 (1) any collections in respect of principal on the Trust Student Loans applied by the Trust to repurchase
guaranteed loans from the Guarantors under the Guarantee Agreements, and 
  
 (2) amounts required by the Higher Education Act to be paid to the Department or to be repaid to borrowers, whether or not in the form of a principal reduction of the applicable Trust Student Loan, on the Trust
Student Loans for that Collection Period, including Consolidation Loan rebate fees, if any; 
  
 (b) any Interest Subsidy Payments and Special Allowance Payments with respect to the Trust Student Loans during that Collection Period; 
  
 (c) all Liquidation Proceeds from any Trust Student Loans which became Liquidated Student Loans during that Collection
Period in accordance with the Servicer’s 

  

 Appendix 1-5 

 
customary servicing procedures, net of expenses incurred by the Servicer related to their liquidation and any amounts required by law to be remitted to the
borrowers on the Liquidated Student Loans, and all Recoveries on Liquidated Student Loans which were written off in prior Collection Periods or during that Collection Period; 
  
 (d) the aggregate Purchase Amounts received during that Collection Period for those Trust Student Loans repurchased by the
Depositor or purchased by the Servicer or for Trust Student Loans sold to another eligible lender pursuant to Section 3.11E of the Servicing Agreement; 
  
 (e) the aggregate Purchase Amounts received during that Collection Period for those Trust Student Loans repurchased by either of SLM ECFC or VG Funding;

  
 (f) the aggregate amounts, if any, received from any of SLM
ECFC, VG Funding, the Depositor or the Servicer, as the case may be, as reimbursement of non-guaranteed interest amounts, or lost Interest Subsidy Payments and Special Allowance Payments, on the Trust Student Loans pursuant to the Sale Agreement or
Section 3.5 of the Servicing Agreement, respectively; 
  
 (g)
amounts received by the Trust pursuant to Sections 3.1 and 3.12 of the Servicing Agreement during that Collection Period as to yield or principal adjustments; 
  

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

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

 
 (k) amounts transferred from the Remarketing Fee Account in excess of the
sum of the Reset Period Target Amount for that Distribution Date; 
  
 (l) amounts transferred from any Investment Premium Purchase Account in excess of the amount required to be on deposit therein pursuant to Section 2.10 (e)(ii) of the Administration Agreement; 
  
 (m) all amounts on deposit in any Investment Reserve Account not transferred
to the Accumulation Account to offset realized losses on Eligible Investments as of that Distribution Date; 
  
 (n) all amounts on deposit in any Supplemental Interest Account; 
  

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

 Appendix 1-6 

 (p) on the initial Distribution Date, the Collection Account Initial Deposit and any amounts transferred
into the Collection Account from the Supplemental Purchase Account following the end of the Supplemental Purchase Period; 
  
 (q) on the related Distribution Date, any amounts transferred from the Add-On Consolidation Loan Account following the end of the Consolidation Loan
Add-On Period; 
  
 (r) amounts transferred from the Reserve
Account in excess of the Specified Reserve Account Balance for that Distribution Date; 
  
 (s) on the October 2006 Distribution Date, all funds then remaining on deposit in the Capitalized Interest Account that are transferred into the Collection Account on that Distribution Date; 
  
 provided that if on any Distribution Date there would not be sufficient funds, after
application of Available Funds, as defined above, and application of amounts available from the Capitalized Interest Account and the Reserve Account to pay any of the items specified in clauses (a) through (e) of Section 2.8 of the Administration
Agreement (but excluding clause (e), and including clauses (f) and (g) thereof, in the event that a condition exists as described in either clause (i) or (ii) of the last paragraph of Section 2.8 of the Administration Agreement), as set forth in
Sections 2.9 and 2.10(a) of the Administration Agreement, relating to such allocations and distributions, then Available Funds for that Distribution Date will include, in addition to the Available Funds as defined above, amounts on deposit in
the Collection Account, or amounts held by the Administrator, or which the Administrator reasonably estimates to be held by the Administrator, for deposit into the Collection Account on the related Determination Date which would have constituted
Available Funds for the Distribution Date succeeding that Distribution Date, up to the amount necessary to pay such items, and the Available Funds for the succeeding Distribution Date will be adjusted accordingly. 
  
 “Basic Documents” means the Trust Agreement, the Indenture,
the Servicing Agreement, the Administration Agreement, the Sale Agreement, the SLM ECFC Purchase Agreement, the VG Funding Purchase Agreement, the Guarantee Agreements, the Note Depository Agreements, the Remarketing Agreement, any Swap Agreements
and other documents and certificates delivered in connection with any such documents. 
  
 “Benefit Plan” means (i) an employee benefit plan (as defined in Section 3(3) of ERISA), whether or not subject to the provisions of Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of
the Code, whether or not subject to Section 4975 of the Code or (iii) any entity whose underlying assets include plan assets by reason of a plan’s investment in the entity. 
  
 “Bill of Sale” has the meaning specified in each of the Purchase Agreements or the Sale Agreement, as
applicable. 
  
 “Book-Entry Note” means a
beneficial interest in the Notes, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 2.10 of the Indenture. 
  

 Appendix 1-7 

 “Business Day” means (i) with respect to calculating LIBOR of a specified maturity or
GBP-LIBOR of a specified maturity, any day on which banks in New York, New York and London, England are open for the transaction of international business and making payments in respect of the Reset Rate Notes if they are denominated in a currency
other than U.S. Dollars; (ii) with respect to calculating EURIBOR of a specified maturity, any day on which TARGET, and banks in New York, New York and London, England, are open for the transaction of international business and making payments in
respect of the Reset Rate Notes if they are denominated in a currency other than U.S. Dollars; and (iii) for all other purposes, any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in New York, New York
or Wilmington, Delaware are authorized or obligated by law, regulation or executive order to remain closed. 
  
 “Call Option” means, the option assigned by the Depositor to SLM Corporation which may be further assigned by SLM Corporation to one of
its subsidiaries as a permitted transferee (provided, that no such subsidiary shall possess the Call Option if it at any time owned an interest in any of the Trust Student Loans) to purchase 100% of the Reset Rate Notes in their entirety as of their
Reset Date, exercisable at a price equal 100% of the Outstanding Amount of the Reset Rate Notes, less all amounts distributed to the Reset Rate Noteholders as a payment of principal in respect of the related Distribution Date, plus any accrued and
unpaid interest not paid by the Trust in respect of the related Distribution Date, and pursuant to the terms and conditions set forth in the Reset Rate Note Procedures. 
  
 “Call Option Notice” means a written notice from the holder of the Call Option or the Administrator, as
applicable, stating its desire to exercise the Call Option on the related Reset Date, delivered to each Clearing Agency, the Indenture Trustee, the Remarketing Agents, the Rating Agencies and, if the Reset Rate Notes are then listed on the
Luxembourg Stock Exchange, the Administrator will forward a copy to the Luxembourg Listing Agent (the contents of which are to be published in a leading newspaper having general circulation in Luxembourg). 
  
 “Call Rate” means, if a Call Option has been exercised with
respect to the Reset Rate Notes, the rate of interest that is either (1) if the Reset Rate Notes did not have at least one related Swap Agreement in effect during the previous Reset Period, the floating rate applicable for the most recent Reset
Period during which the Failed Remarketing Rate was not in effect; or (2) if the Reset Rate Notes had one or more related Swap Agreements in effect during the previous Reset Period, the weighted average of the floating rates of interest that were
due to the related Interest Rate Swap Counterparties from the Trust during the previous Reset Period. The Call Rate will continue to apply for each Reset Period while the holder of the Call Option retains the Reset Rate Notes. 
  
 “Capitalized Interest” means for any Distribution Date
through and including the October 2006 Distribution Date: 
  

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

  

 Appendix 1-8 

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

  
 “Capitalized Interest Account” means the account designated
as such, established and maintained pursuant to Section 2.3(h) of the Administration Agreement. 
  
 “Capitalized Interest Account Balance” means as of any date of determination, the amount on deposit in the Capitalized Interest Account
(exclusive of Investment Earnings). 
  
 “Capitalized
Interest Account Initial Deposit” means $46,000,000. 
  
 “Carryover Servicing Fee” has the meaning specified in Attachment A to the Servicing Agreement. 
  
 “Class A Note” means a Class A-1 Note, a Class A-2 Note, a Class A-3 Note, a Class A-4 Note or a Class A-5 Note. 
  
 “Class A Note Interest Shortfall” means, for any
Distribution Date, the excess of (x) the Class A Noteholders’ Interest Distribution Amount on the preceding Distribution Date, over (y) the amount of interest actually distributed to the Class A Noteholders or any Currency Swap Counterparty, as
applicable on the preceding Distribution Date, plus interest on the amount of that excess, to the extent permitted by law, at the interest rate applicable for each such class of Notes from the preceding Distribution Date to the current Distribution
Date. 
  
 “Class A Note Principal Shortfall”
means, as of the close of any Distribution Date, the excess of (i) the Class A Noteholders’ Principal Distribution Amount on that Distribution Date, over (ii) the amount of principal actually distributed or allocated to the Class A Noteholders
or deposited into any Accumulation Account on such Distribution Date. 
  
 “Class A Noteholder” means the Person in whose name a Class A Note is registered in the Note Register. 
  
 “Class A Noteholders’ Distribution Amount” means, for any Distribution Date, the sum of the Class A Noteholders’ Interest
Distribution Amount and the Class A Noteholders’ Principal Distribution Amount for that Distribution Date. 
  
 “Class A Noteholders’ Interest Distribution Amount” means, for any Distribution Date, the sum of: (1) the amount of interest accrued
at the Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate or the Class A-5 Rate as applicable, for the related Accrual Period on the Outstanding Amount of all classes of Class A Notes on the immediately preceding Distribution
Date(s) after giving effect to all principal distributions to Class A Noteholders on that preceding Distribution Date or, in the case of the first Distribution Date, on the Closing Date, and (2) the Class A Note Interest Shortfall for that
Distribution Date. 
  

 Appendix 1-9 

 “Class A Noteholders’ Principal Distribution Amount” means, for any Distribution
Date, the Principal Distribution Amount times the Class A Percentage for that Distribution Date, plus any Class A Note Principal Shortfall as of the close of business on the preceding Distribution Date; provided that the Class A
Noteholders’ Principal Distribution Amount will not exceed the Outstanding Amount of the Class A Notes (less all amounts, other than Investment Earnings, on deposit in any related Accumulation Account). In addition, on the Maturity Date for any
of the Class A Notes, the principal required to be distributed to the related Class A Noteholders will include the amount required to reduce the Outstanding Amount of that class to zero. 
  
 “Class A Notes” means the Floating Rate Class A Notes and the Reset Rate Notes. 
  
 “Class A Percentage” means 100% minus the Class B
Percentage. 
  
 “Class A-1 Maturity Date” means
the January 2018 Distribution Date. 
  
 “Class A-2
Maturity Date” means the October 2021 Distribution Date. 
  
 “Class A-3 Maturity Date” means the April 2025 Distribution Date. 
  
 “Class A-4 Maturity Date” means the October 2028 Distribution Date. 
  
 “Class A-5 Maturity Date” means the October 2040 Distribution Date. 
  
 “Class A-1 Noteholder” means a Person in whose name a Class A-1 Note is registered in the Note Register.

  
 “Class A-2 Noteholder” means a Person in
whose name a Class A-2 Note is registered in the Note Register. 
  
 “Class A-3 Noteholder” means a Person in whose name a Class A-3 Note is registered in the Note Register. 
  
 “Class A-4 Noteholder” means a Person in whose name a Class A-4 Note is registered in the Note Register. 
  
 “Class A-5 Noteholder” means a Person in whose name a Class
A-5 Note is registered in the Note Register. 
  
 “Class
A-1 Notes” means the $672,000,000 Floating Rate Class A-1 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially in the form of Exhibit A-1 thereto. 
  
 “Class A-2 Notes” means the $420,000,000 Floating Rate Class
A-2 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially in the form of Exhibit A-2 thereto. 
  

 Appendix 1-10 

 “Class A-3 Notes” means the $420,000,000 Floating Rate Class A-3 Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form of Exhibit A-3 thereto. 
  
 “Class A-4 Notes” means the $361,844,000 Floating Rate Class A-4 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-4 thereto. 
  
 “Class A-5 Notes” means the $350,000,000 Reset Rate Class A-5 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially in the form of Exhibits A-5, A-6 and A-7 thereto. 
  
 “Class A-1 Rate” means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR, as determined on the second Business Day before the beginning of the applicable Accrual Period, plus 0.00%, based on an Actual/360 accrual method. For the initial Accrual Period, the Class A-1 Rate shall
mean the Initial Accrual Rate plus 0.00%, based on an Actual/360 accrual method. 
  
 “Class A-2 Rate” means, for any Accrual Period after the initial Accrual Period, Three-Month LIBOR, as determined on the second Business Day before the beginning of the applicable Accrual Period, plus
0.08%, based on an Actual/360 accrual method. For the initial Accrual Period, the Class A-2 Rate shall mean the Initial Accrual Rate plus 0.08%, based on an Actual/360 accrual method. 
  
 “Class A-3 Rate” means, for any Accrual Period after the initial Accrual Period, Three-Month LIBOR, as
determined on the second Business Day before the beginning of the applicable Accrual Period, plus 0.10%, based on an Actual/360 accrual method. For the initial Accrual Period, the Class A-3 Rate shall mean the Initial Accrual Rate plus 0.10%, based
on an Actual/360 accrual method. 
  
 “Class A-4
Rate” means, for any Accrual Period after the initial Accrual Period, Three-Month LIBOR, as determined on the second Business Day before the beginning of the applicable Accrual Period, plus 0.14%, based on an Actual/360 accrual method. For
the initial Accrual Period, the Class A-4 Rate shall mean the Initial Accrual Rate plus 0.14%, based on an Actual/360 accrual method. 
  
 “Class A-5 Rate” means, for any Accrual Period (other than the initial Accrual Period) until and including the Initial Reset Date for the
Class A-5 Notes, Three-Month LIBOR, as determined on the second Business Day before the beginning of the applicable Accrual Period, plus 0.03%, based on an Actual/360 accrual method. For the initial Accrual Period, the Class A-5 Rate shall mean the
Initial Accrual Rate plus 0.03%, based on an Actual/360 accrual method. 
  
 “Class B Maturity Date” means the October 2040 Distribution Date. 
  
 “Class B Note Interest Shortfall” means, with respect to any Distribution Date, (1) the excess of (i) the Class B Noteholders’ Interest Distribution Amount on the preceding Distribution Date,
over (ii) the amount of interest actually distributed to the Class B Noteholders on such preceding Distribution Date, plus (2) interest on the amount of such excess interest due to the Class B Noteholders, to the extent permitted by law, at
the Class B Rate from such preceding Distribution Date to the current Distribution Date. 
  

 Appendix 1-11 

 “Class B Note Principal Shortfall” means, as of the close of any Distribution Date, the
excess of (i) the Class B Noteholders’ Principal Distribution Amount on such Distribution Date over (ii) the amount of principal actually distributed to the Class B Noteholders on such Distribution Date. 
  
 “Class B Noteholder” means the Person in whose name a Class
B Note is registered in the Note Register. 
  
 “Class B
Noteholders’ Distribution Amount” means, for any Distribution Date, the sum of the Class B Noteholders’ Interest Distribution Amount and the Class B Noteholders’ Principal Distribution Amount for that Distribution Date.

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

  
 “Class B Noteholders’ Principal Distribution
Amount” means, for any Distribution Date, the Principal Distribution Amount times the Class B Percentage for that Distribution Date, plus any Class B Note Principal Shortfall as of the close of business on the preceding Distribution Date;
provided that the Class B Noteholders’ Principal Distribution Amount will not exceed the Outstanding Amount of the Class B Notes. In addition, on the Class B Maturity Date, the principal required to be distributed to the Class B
Noteholders will include the amount required to reduce the Outstanding Amount of the Class B Notes to zero. 
  
 “Class B Notes” means the $68,779,000 Floating Rate Class B Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-8 thereto. 
  
 “Class B Percentage” with respect to any Distribution Date, means (1) prior to the Stepdown Date or with respect to any Distribution Date on which a Trigger Event is in effect, zero; and (2) on and after the Stepdown Date
and provided that no Trigger Event is in effect, a fraction expressed as a percentage, the numerator of which is the aggregate principal balance of the Class B Notes immediately prior to that Distribution Date and the denominator of which is the
Outstanding Amount of the Notes, less all amounts (other than Investment Earnings) on deposit in any Accumulation Account, immediately prior to that Distribution Date. 
  
 “Class B Rate” means, for any Accrual Period after the initial Accrual Period, Three-Month LIBOR, as
determined on the second Business Day before the beginning of the applicable Accrual Period, plus 0.25%, based on an Actual/360 accrual method. For the initial Accrual Period, the Class B Rate shall mean the Initial Accrual Rate plus 0.25%, based on
an Actual/360 accrual method. 
  

 Appendix 1-12 

 “Clearing Agency” means DTC, Euroclear or Clearstream, as applicable, or another
organization registered as a “clearing agency” pursuant to applicable law. The initial Clearing Agency for the Floating Rate Notes shall be DTC and the initial nominee for such Clearing Agency shall be Cede & Co. The initial Clearing
Agencies for the Reset Rate Notes (i) for any related Reset Period when they are denominated in a currency other than U.S. Dollars shall be Euroclear and Clearstream and the initial joint nominee for such Clearing Agencies shall be Deutsche Bank AG
London, and (ii) for any related Reset Period when they are denominated in U.S. Dollars shall be DTC and the initial nominee for such Clearing Agency shall be Cede & Co., or Euroclear and Clearstream and the initial joint nominee for such
Clearing Agencies shall be Deutsche Bank AG London, as applicable. 
  
 “Clearing Agency Participant” means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency. 
  
 “Clearstream” means
Clearstream Banking, société anonyme, Luxembourg. 
  
 “Closing Date” means June 29, 2005. 
  
 “CMT Rate” means, for any relevant Interest Rate Determination Date prior to each Interest Rate Change Date, the rate displayed on the applicable Designated CMT Moneyline Telerate Page shown below by 3:00 p.m., New York
City time, on that Interest Rate Determination Date under the caption “. . . Treasury Constant Maturities . . . Federal Reserve Board Release H.15 . . . Mondays Approximately 3:45 p.m.,” under the column for: (i) if the Designated CMT
Moneyline Telerate Page is 7051, the rate on that Interest Rate Determination Date; or (ii) if the Designated CMT Moneyline Telerate Page is 7052, the average for the week, the month or the quarter, as specified on the Remarketing Terms
Determination Date, ended immediately before the week in which the Interest Rate Determination Date occurs. The following procedures will apply if the CMT Rate cannot be determined as described above: (i) if the rate described above is not displayed
on the relevant page by 3:00 p.m., New York City time on that Interest Rate Determination Date, unless the calculation is made earlier and the rate is available from that source at that time on that Interest Rate Determination Date, then the CMT
Rate will be the Treasury constant maturity rate having the designated index maturity, as published in H.15(519) or another recognized electronic source for displaying the rate, (ii) if the applicable rate described above is not published in
H.15(519) or another recognized electronic source for displaying such rate by 3:00 p.m., New York City time on that Interest Rate Determination Date, unless the calculation is made earlier and the rate is available from one of those sources at that
time, then the CMT Rate will be the Treasury constant maturity rate, or other United States Treasury rate, for the index maturity and with reference to the relevant Interest Rate Determination Date, that is published by either the Board of Governors
of the Federal Reserve System or the United States Department of the Treasury and that the Administrator determines to be comparable to the rate formerly displayed on the Designated CMT Moneyline Telerate Page shown above and published in H.15(519),
(iii) if the rate described in the prior paragraph cannot be determined, then the Administrator will determine the CMT Rate to be a yield to maturity based on the average of the secondary market closing offered rates as of approximately 3:30 p.m.,
New York City time, on the relevant Interest Rate Determination Date reported, according to their written records, by leading primary United 

  

 Appendix 1-13 

 
States government securities dealers in New York City. The Administrator will select five such securities dealers and will eliminate the highest and lowest
quotations or, in the event of equality, one of the highest and lowest quotations, for the most recently issued direct noncallable fixed rate obligations of the United States Treasury (“Treasury Notes”) with an original maturity of
approximately the designated index maturity and a remaining term to maturity of not less than the designated index maturity minus one year in a representative amount, (iv) if the Administrator cannot obtain three Treasury Note quotations of the kind
described above in (iii), the Administrator will determine the CMT Rate to be the yield to maturity based on the average of the secondary market bid rates for Treasury Notes with an original maturity longer than the designated CMT index maturity
which have a remaining term to maturity closest to the designated CMT index maturity and in a representative amount, as of approximately 3:30 p.m., New York City time, on the relevant Interest Rate Determination Date of leading primary United States
government securities dealers in New York City. In selecting these offered rates, the Administrator will request quotations from at least five such securities dealers and will disregard the highest quotation (or if there is equality, one of the
highest) and the lowest quotation (or if there is equality, one of the lowest). If two Treasury Notes with an original maturity longer than the designated CMT index maturity have remaining terms to maturity that are equally close to the designated
CMT index maturity, the Administrator will obtain quotations for the Treasury Note with the shorter remaining term to maturity, (v) if three or four but not five leading primary United States government securities dealers are quoting as described in
the prior paragraph, then the CMT Rate for the relevant Interest Rate Determination Date will be based on the average of the bid rates obtained and neither the highest nor the lowest of those quotations will be eliminated, or (vi) if fewer than
three leading primary United States government securities dealers selected by the Administrator are quoting as described in (v) above, the CMT Rate will remain the CMT Rate then in effect on that Interest Rate Determination Date. 
  
 “Code” means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder. 
  
 “Collateral” has the meaning specified in the Granting Clause of the Indenture. 
  
 “Collection Account” means the account designated as such, established and maintained pursuant to Section 2.3(f) of the Administration
Agreement. 
  
 “Collection Account Initial
Deposit” means $7,230,000 representing amounts excluded from the Supplemental Purchase Account Initial Deposit due to the application of the proviso contained in the definition thereof. 
  
 “Collection Period” means, with respect to the first
Distribution Date, the period beginning on the Closing Date and ending on September 30, 2005; and with respect to each subsequent Distribution Date, the Collection Period means the three calendar months immediately following the end of the previous
Collection Period. 
  
 “Commercial Paper Rate”
means, for any relevant Interest Rate Determination Date prior to each Interest Rate Change Date, the Bond Equivalent Yield shown below of the rate for 90-day commercial paper, as published in H.15(519) prior to 3:00 p.m., New York City time, on
that Interest Rate Determination Date under the heading “Commercial Paper—Financial”. If the rate 

  

 Appendix 1-14 

 
described above is not published in H.15(519) by 3:00 p.m., New York City time, on that Interest Rate Determination Date, unless the calculation is made
earlier and the rate was available from that source at that time, then the Commercial Paper Rate will be the Bond Equivalent Yield of the rate on the relevant Interest Rate Determination Date, for commercial paper having the index maturity specified
on the Remarketing Terms Determination Date, as published in H.15 Daily Update or any other recognized electronic source used for displaying that rate under the heading “Commercial Paper—Financial”. For purposes of the definition of
“Commercial Paper Rate”, the “Bond Equivalent Yield” equals (NxD)]/[360(Dx90) times 100, where “D” refers to the per annum rate determined as set forth above, quoted on a bank discount basis and expressed as a decimal
and “N” refers to 365 or 366, as the case may be. If the rate described above cannot be determined, the Commercial Paper Rate will remain the commercial paper rate then in effect on that Interest Rate Determination Date. Unless otherwise
specified on the Remarketing Terms Determination Date, the Commercial Paper Rate will be subject to a Lock-In Period of six Business Days. 
  
 “Commission” means the Securities and Exchange Commission. 
  
 “Consolidation Loans” means Student Loans made in accordance with the Section 428C of the Higher Education
Act. 
  
 “Consolidation Loan Add-On Period” means
the period during which the Trust will be able to purchase Add-On Consolidation Loans with funds on deposit in the Add-On Consolidation Loan Account, beginning on the Closing Date and ending on December 31, 2005. 
  
 “Corporate Trust Office” means (i) with respect to the
Indenture Trustee, the principal office of the Indenture Trustee at which at any particular time its corporate trust business shall be administered, which office at the Closing Date is located at 60 Wall Street 26th Floor, Mailstop NYC60-2606, New
York, New York 10005, Attention: Trust & Securities Services/Structured Finance Services, telephone: (212) 250-8454, facsimile: (212) 797-8606 or at such other address as the Indenture Trustee may designate from time to time by notice to the
Noteholders and the Depositor, or the principal corporate trust office of any successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the Noteholders, the Administrator and the Depositor) and (ii) with respect
to the Eligible Lender Trustee, the principal corporate trust office of the Eligible Lender Trustee located at Christiana Center/OPS4, 500 Stanton Christiana Road, Newark, Delaware 19713, Attention: Corporate Trust Department (telephone: (302)
552-6279; facsimile: (302) 552-6280); or at such other address as the Eligible Lender Trustee may designate by notice to the Depositor, or the principal corporate trust office of any successor Eligible Lender Trustee (the address of which the
successor Eligible Lender Trustee will notify the Administrator and the Depositor). 
  
 “Currency Swap Agreement” means with respect to the Reset Rate Notes when they are in Foreign Exchange Mode, each Swap Agreement between the Trust and the related Currency Swap Counterparty which (i)
converts the secondary market trade proceeds into U.S. Dollars received on the effective date of such Swap Agreement; (ii) converts all principal payments in U.S. Dollars by the Trust to the Reset Rate Noteholders into the applicable currency; (iii)
converts the interest rate on the Reset Rate Notes from a LIBOR-based rate to a fixed or floating rate payable in the applicable currency; (iv) converts the U.S. Dollar equivalent of all secondary 

  

 Appendix 1-15 

 
market trade proceeds received on the related Reset Date resulting in the successful remarketing of the Reset Rate Notes or the exercise of a Call Option
into the applicable currency for the payment of principal to the tendering Reset Rate Noteholders; and (v) pays to the Paying Agent, on behalf of the Trust, for the benefit of the tendering Reset Rate Noteholders, the required amount of additional
interest at the interest rate applicable to the tendered Reset Rate Notes resulting from any required delay in Reset Date payments through Euroclear and Clearstream. 
  
 “Currency Swap Counterparty” means each Eligible Swap Counterparty that is a party, in its capacity as swap
counterparty, to the related Currency Swap Agreement. 
  
 “Custodian” has the meaning specified in Section 2.1 of the Indenture. 
  
 “Cutoff Date” means (a) the Initial Cutoff Date with respect to the Initial Trust Student Loans and (b) the applicable Subsequent Cutoff
Date with respect to the related Additional Trust Student Loan or Substituted Trust Student Loan. 
  
 “Day Count Basis” means 30/360, Actual/360, Actual/365 (Fixed), Actual/Actual (accrual basis), Actual/Actual (ISMA) or Actual/Actual
(payment basis), as applicable, or any other day count basis set forth in the Remarketing Terms Notice. 
  
 “Default” means any occurrence that is, or with notice or the lapse of time or both would become, an Event of Default. 
  
 “Definitive Notes” has the meaning specified in Section 2.10
of the Indenture. 
  
 “Delaware Statutory Trust
Act” means Chapter 38 of Title 12, Part V of the Delaware Code, entitled “Treatment of Delaware Statutory Trusts.” 
  
 “Delivery” when used with respect to Trust Account Property means: 
  
 (a) with respect to bankers’ acceptances, commercial paper, negotiable certificates of deposit and other obligations
that constitute “instruments” within the meaning of Section 9-102(a)(47) of the UCC and are susceptible of physical delivery, transfer thereof to the Indenture Trustee or its nominee or custodian by physical delivery to the Indenture
Trustee or its nominee or custodian endorsed to, or registered in the name of, the Indenture Trustee or its nominee or custodian or endorsed in blank, and, with respect to a certificated security (as defined in Section 8-102(a)(3) of the UCC)
transfer thereof (i) by delivery of such certificated security endorsed to, or registered in the name of, the Indenture Trustee or its nominee or custodian or endorsed in blank to a securities intermediary (as defined in Section 8-102(a)(14) of the
UCC) and the making by such securities intermediary of entries on its books and records identifying such certificated securities as belonging to the Indenture Trustee or its nominee or custodian and the sending by such securities intermediary of a
confirmation of the purchase of such certificated security by the Indenture Trustee or its nominee or custodian, or (ii) by delivery thereof to a “clearing corporation” (as defined in Section 8-102(a)(5) of the UCC) and the making by such
clearing corporation of appropriate entries on its books reducing the appropriate securities account of the transferor and increasing the appropriate securities account of a securities intermediary by the amount of such certificated security, the
identification by the clearing corporation of the certificated securities for the sole and exclusive account of the securities 

  

 Appendix 1-16 

 
intermediary, the maintenance of such certificated securities by such clearing corporation or the nominee of either subject to the clearing
corporation’s exclusive control, the sending of a confirmation by the securities intermediary of the purchase by the Indenture Trustee or its nominee or custodian of such securities and the making by such securities intermediary of entries on
its books and records identifying such certificated securities as belonging to the Indenture Trustee or its nominee or custodian (all of the foregoing, but not including Trust Student Loans, “Physical Property”); and such additional or
alternative procedures as may hereafter become appropriate to effect the complete transfer of ownership of any such Trust Account Property to the Indenture Trustee or its nominee or custodian, consistent with changes in applicable law or regulations
or the interpretation thereof; 
  
 (b) with respect to any
security issued by the U.S. Treasury, the Government National Mortgage Association, the Federal Home Loan Mortgage Corporation or the Federal National Mortgage Association that is a book-entry security held at a Federal Reserve Bank pursuant to
Federal book-entry regulations, the following procedures, all in accordance with applicable law, including applicable Federal regulations and Articles 8 and 9 of the UCC: the crediting of such book-entry security to an appropriate book-entry account
of the Indenture Trustee or its nominee or the custodian or securities intermediary at a Federal Reserve Bank, causing the custodian to continuously indicate by book-entry such book-entry security as credited to the relevant book-entry account, the
continuous crediting of such book-entry security to a securities account of the custodian at such Federal Reserve Bank and the continuous identification of such book-entry security by the custodian as credited to the appropriate book-entry account;
and 
  
 (c) with respect to any item of Trust Account Property
that is an uncertificated security under Article 8 of the UCC and that is not governed by clause (b) above, registration on the books and records of the issuer thereof in the name of the securities intermediary, the sending of a confirmation by the
securities intermediary of the purchase by the Indenture Trustee or its nominee or custodian of such uncertificated security, the making by such securities intermediary of entries on its books and records identifying such uncertificated certificates
as belonging to the Indenture Trustee or its nominee or custodian. 
  
 “Department” means the United States Department of Education, an agency of the Federal government. 
  
 “Depositor” means SLM Funding LLC, a Delaware limited liability company, and its successors and assigns, including, for such purpose, a
permitted transferee of all of SLM Funding LLC’s right, title and interest in the Excess Distribution Certificate. 
  
 “Depository Agreements” means the Note Depository Agreements. 
  
 “Determination Date” means, with respect to the Collection Period preceding any Distribution Date, the
first Business Day preceding such Distribution Date. 
  
 “Distribution Date” means for any class of Notes, the 25th day of each of January, April, July and October, or, if such day is not a Business Day, the immediately following Business Day, commencing October 25, 2005.

  

 Appendix 1-17 

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

“Eligible Institution” means a depository institution organized under the laws of the United States of America or any one of the
States or the District of Columbia (or any domestic branch of a foreign bank) (i) which has (A) either a long-term senior unsecured debt rating of “AAA” or a short-term senior unsecured debt or certificate of deposit rating of
“A-1+” or better by S&P and (B)(1) a long-term senior unsecured debt rating of “A1” or better and (2) a short-term senior unsecured debt rating of “P-1” or better by Moody’s, and (C) if such institution is
rated by Fitch, a long-term senior unsecured debt rating of “AA” or a short-term senior unsecured debt rating of “F1+,” or any other long-term, short-term or certificate of deposit rating with respect to which the Rating Agency
Condition has been satisfied and (ii) whose deposits are insured by the FDIC. If so qualified, the Eligible Lender Trustee or the Indenture Trustee may be considered an Eligible Institution. 
  
 “Eligible Investments” means book-entry securities,
negotiable instruments or securities represented by instruments in bearer or registered form which evidence: 
  
 (a) direct obligations of, and obligations fully guaranteed as to timely payment by, the United States of America, the Government National Mortgage
Association, the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, or any agency or instrumentality of the United States of America the obligations of which are backed by the full faith and credit of the United
States of America; provided that obligations of, or guaranteed by, the Government National Mortgage Association (GNMA), the Federal Home Loan Mortgage Corporation (Freddie Mac) or the Federal National Mortgage Association (Fannie Mae) shall
be Eligible Investments only if, at the time of investment, they meet the criteria of each of the Rating Agencies for collateral for securities having ratings equivalent to the respective ratings of the Notes in effect at the Closing Date;

  
 (b) demand deposits, time deposits or certificates of deposit
of any depository institution or trust company incorporated under the laws of the United States of America or any State (or any domestic branch of a foreign bank) and subject to supervision and examination by Federal or state banking or depository
institution authorities (including depository receipts issued by any such institution or trust company as custodian with respect to any obligation referred to in clause (a) above or portion of such obligation for the benefit of the holders of such
depository receipts); provided that at the time of the investment or contractual commitment to invest therein 

  

 Appendix 1-18 

 
(which shall be deemed to be made again each time funds are reinvested following each Distribution Date), the commercial paper or other short-term senior
unsecured debt obligations (other than such obligations the rating of which is based on the credit of a Person other than such depository institution or trust company) thereof shall have a credit rating from each of the Rating Agencies in the
highest investment category granted thereby; 
  
 (c) commercial
paper having, at the time of the investment, a rating from each of the Rating Agencies in the highest investment category granted thereby; 
  
 (d) investments in money market funds having a rating from each of the Rating Agencies in the highest investment category granted thereby (including funds
for which the Indenture Trustee, the Administrator or the Eligible Lender Trustee or any of their respective Affiliates is investment manager or advisor); 
  
 (e) bankers’ acceptances issued by any depository institution or trust company referred to in clause (b) above; 
  
 (f) repurchase obligations with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any agency or instrumentality thereof the obligations of which are backed by the full faith and credit of the United States of America, in either case entered into with a
depository institution or trust company (acting as principal) described in clause (b) above; 
  
 (g) asset-backed securities, including asset-backed securities issued by Affiliates, or entities formed by Affiliates, of SLM Corporation, but excluding mortgage-backed securities, that at the time of investment have
a rating in the highest investment category granted by each of the Rating Agencies, but not at a purchase price in excess of par; 
  
 (h) Eligible Repurchase Obligations; and 
  
 (i) any other investment which would not result in the downgrading or withdrawal of any rating of the Notes by any of the Rating Agencies as affirmed in
writing delivered to the Indenture Trustee. 
  
 For purposes of the definition of
“Eligible Investments” the phrase “highest investment category” means (i) in the case of Fitch, “AAA” for long-term investments (or the equivalent) and “F-1+” for short-term investments (or the equivalent),
(ii) in the case of Moody’s, “Aaa” for long-term investments (or the equivalent) and “P-1” for short-term investments (or the equivalent), and (iii) in the case of S&P, “AAA” for long-term investments (or the
equivalent) and “A-1+” for short-term investments (or the equivalent). A proposed investment not rated by Fitch but rated in the highest investment category by Moody’s and S&P shall be considered to be rated by each of the Rating
Agencies in the highest investment category granted thereby. 
  
 “Eligible Lender Trustee” means Chase Bank USA, National Association, a national banking association, not in its individual capacity but solely as Eligible Lender Trustee under the Trust Agreement. “Eligible Lender
Trustee” shall also mean each successor Eligible Lender Trustee as of the qualification of such successor as Eligible Lender Trustee under the Trust Agreement. 
  

 Appendix 1-19 

 “Eligible Loans” has the meaning specified in any of the Purchase Agreements or the Sale
Agreement, as applicable. 
  
 “Eligible Repo
Counterparty” means an institution that is an eligible lender (under the Federal Family Education Loan Program) or that holds Student Loans through an eligible lender trustee and whose short-term debt ratings are not less than
“P-1” by Moody’s, “A-1” by S&P and “F1” by Fitch, if rated by Fitch. 
  
 “Eligible Repurchase Obligations” means repurchase obligations with respect to Student Loans serviced by the Servicer or an Affiliate
thereof, entered into with an Eligible Repo Counterparty, provided that the applicable repurchase date shall occur no later than the Business Day prior to the next Distribution Date. 
  
 “Eligible Swap Counterparty” means an entity, which may be an affiliate of a Remarketing Agent, engaged in
the business of entering into derivative instrument contracts that satisfies the Rating Agency Condition. 
  
 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. 
  
 “EURIBOR” means, with respect to any Accrual Period, the
Euro-zone interbank offered rate for deposits in Euros having the specified maturity commencing on the first day of the Accrual Period, which appears on Telerate Page 248 as of 11:00 a.m. Brussels time, on the related EURIBOR Determination Date. If
an applicable rate does not appear on Telerate Page 248, the rate for that day will be determined on the basis of the rates at which deposits in Euros having the specified maturity and in a principal amount of not less than €1,000,000, are
offered at approximately 11:00 a.m., Brussels time, on that EURIBOR Determination Date, to prime banks in the Euro-zone interbank market by the Reference Banks. The Administrator will request the principal Euro-zone office of each Reference Bank to
provide a quotation of its rate. If the Reference Banks provide at least two quotations, the rate for that day will be the arithmetic mean of the quotations. If the Reference Banks provide fewer than two quotations, the rate for that day will be the
arithmetic mean of the rates quoted by major banks in the Euro-zone, selected by the Administrator, at approximately 11:00 a.m. Brussels time, on that EURIBOR Determination Date, for loans in Euros to leading European banks having the specified
maturity and in a principal amount of not less than €1,000,000. If the banks selected as described above are not providing quotations, EURIBOR in effect for the applicable Accrual Period will be EURIBOR for the specified maturity in effect for
the previous Accrual Period. 
  
 “EURIBOR Determination
Date” means, for each Accrual Period, the day that is two EURIBOR Settlement Days before the beginning of that Accrual Period. 
  
 “EURIBOR Settlement Day” means any day on which TARGET is open which is also a day on which banks in New York, New York and London,
England are open for business. 
  
 “Euro Account”
means any account designated as such, established and maintained pursuant to Section 2.3(o) of the Administration Agreement. 
  
 “Euroclear” means the Euroclear System, or any successor thereto. 
  

 Appendix 1-20 

 “European Clearing Systems” means Euroclear or Clearstream. 
  
 “Event of Default” has the meaning specified in Section 5.1
of the Indenture. 
  
 “Excess Distribution
Certificate” means the certificate, substantially in the form of Exhibit A to the Trust Agreement, evidencing the right to receive payments thereon as set forth in Sections 2.8(p) and 2.9(f) of the Administration Agreement.

  
 “Excess Distribution Certificate Paying
Agent” means any paying agent or co-paying agent appointed pursuant to Section 3.3(g) of the Trust Agreement, which paying agent shall initially be the Indenture Trustee. 
  
 “Excess Distribution Certificate Register” and “Excess Distribution Certificate Registrar”
mean the register mentioned and the registrar appointed pursuant to Section 3.3(c) of the Trust Agreement. 
  
 “Excess Distribution Certificateholder” means the person in whose name an Excess Distribution Certificate is registered in the Excess
Distribution Certificate Register. 
  
 “Exchange
Act” means the Securities Exchange Act of 1934, as amended. 
  
 “Executive Officer” means, with respect to any corporation, the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary or the Treasurer of such corporation; and with respect to any partnership, any general partner thereof. 
  
 “Expenses” means any and all liabilities, obligations, losses, damages, taxes, claims, actions and suits, and any and all reasonable
costs, expenses and disbursements (including reasonable legal fees and expenses) of any kind and nature whatsoever which may at any time be imposed on, incurred by, or asserted against the Eligible Lender Trustee or any of its officers, directors or
agents in any way relating to or arising out of the Trust Agreement, the other Basic Documents, the Trust Estate, the administration of the Trust Estate or the action or inaction of the Eligible Lender Trustee under the Trust Agreement or the other
Basic Documents. 
  
 “Extension Rate” means, for
each Distribution Date following a Failed Remarketing if the Reset Rate Notes are then in Foreign Exchange Mode, the rate of interest payable to each related Currency Swap Counterparty, not to exceed Three-Month LIBOR plus 0.75%, unless the
Remarketing Agents, in consultation with the Administrator, determine that market conditions or some other benefit to the Trust requires a higher rate; provided that in such case the Rating Agency Condition is satisfied. 
  
 “Failed Remarketing” means, on any Reset Date for the Reset
Rate Notes, the situation where: 
  
 (a) the Remarketing Agents,
in consultation with the Administrator, cannot establish one or more of the terms required to be set on the Remarketing Terms Determination Date; 
  

 Appendix 1-21 

 (b) the Remarketing Agents are unable to establish the Spread or fixed rate on the Spread Determination
Date; 
  
 (c) either the Remarketing Agents are unable to remarket
all or some of the tendered Reset Rate Notes at the Spread or fixed rate established on the Spread Determination Date, or any committed purchasers default on their purchase obligations and in their sole discretion, the Remarketing Agents elect not
to purchase the Reset Rate Notes themselves; 
  
 (d) the
Remarketing Agents, in consultation with the Administrator, are unable to obtain one or more Swap Agreements meeting the required criteria, if applicable; 
  
 (e) any of the conditions specified in Section 8 of the Remarketing Agreement are not satisfied; or 
  
 (f) any applicable Rating Agency Condition has not been satisfied.

  
 “Failed Remarketing Rate” means, for any
Reset Period when the Reset Rate Notes are then denominated in U.S. Dollars, Three-Month LIBOR plus 0.75%; and for any Reset Period when the Reset Rate Notes are in Foreign Exchange Mode, as will be determined on the related Spread Determination
Date pursuant to the terms of the related Currency Swap Agreement. 
  
 “FDIC” means the Federal Deposit Insurance Corporation. 
  
 “Federal Funds Rate” means the rate set forth for such day opposite the caption “Federal Funds (effective)” in the weekly statistical release designated H.15(519), or any successor
publication, published by the Board of Governors of the Federal Reserve System. If such rate is not published in the relevant H.15(519) for any day, the rate for such day shall be the arithmetic mean of the rates for the last transaction in
overnight Federal Funds arranged prior to 9:00 a.m. New York City time on that day by each of four leading brokers in such transactions located in New York City selected by the Administrator. The Federal Funds rate for each Saturday and Sunday and
for any other that is not a Business Day shall be the Federal Funds Rate for the preceding Business Day as determined above. 
  
 “Fitch” means Fitch Inc., also known as Fitch Ratings, or any successor Rating Agency. 
  
 “Floating Rate Class A Notes” means the Class A-1 Notes, the
Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes. 
  
 “Floating Rate Noteholder” means the Person in whose name a Floating Rate Note is registered in the Note Register. 
  
 “Floating Rate Notes” means the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes.

  
 “Four-Month LIBOR” see Three-Month LIBOR.

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

 Appendix 1-22 

 “Funding Interim Trust Agreement” means the Interim Trust Agreement, dated as of June 1,
2005, between the Depositor and the Interim Eligible Lender Trustee. 
  
 “GBP-LIBOR” means, with respect to any Accrual Period, the London interbank offered rate for deposits in Pounds Sterling having a maturity of three months, commencing on the first day of the Accrual Period, which appears on
Telerate Page 3750 as of 11:00 a.m. London time, on the related GBP-LIBOR Determination Date. If an applicable rate does not appear on Telerate Page 3750, the rate for that day will be determined on the basis of the rates at which deposits in Pounds
Sterling, having the specified maturity and in a principal amount of not less than £1,000,000, are offered at approximately 11:00 a.m., London time, on that GBP-LIBOR Determination Date, to prime banks in the London interbank market by the
Reference Banks. The Administrator will request the principal London office of each Reference Bank to provide a quotation of its rate. If the Reference Banks provide at least two quotations, the rate for that day will be the arithmetic mean of the
quotations. If the Reference Banks provide fewer than two quotations, the rate for that day will be the arithmetic mean of the rates quoted by prime banks in London, selected by the Administrator, at approximately 11:00 a.m. London time, on that
GBP-LIBOR Determination Date, for loans in Pounds Sterling to leading European banks having the specified maturity and in a principal amount of not less than £1,000,000. If the banks selected as described above are not providing quotations,
GBP-LIBOR in effect for the applicable Accrual Period will be GBP-LIBOR for the specified maturity in effect for the previous Accrual Period. For any GBP-LIBOR-based notes, interest due for any Accrual Period always will be determined based on the
actual number of days elapsed in the Accrual Period over a 365-day year. 
  
 “GBP-LIBOR Determination Date” means, for each Accrual Period, the day that is two GBP-LIBOR Settlement Days before the beginning of that Accrual Period. 
  
 “GBP-LIBOR Settlement Day” means any day on which banks in
both London and New York City are open for business. 
  
 “GLB Regulations” means the Joint Banking Agencies’ Privacy of Consumer Financial Information, Final Rule (12 CFR Parts 40, 216, 332 and 573) or the Federal Trade Commission’s Privacy of Consumer Financial
Information, Final Rule (16 CFR Part 313), as applicable, implementing Title V of the Gramm-Leach-Bliley Act, Public Law 106-102, as amended. 
  
 “Grant” means mortgage, pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create and grant a lien upon
and a security interest in and right of set-off against, deposit, set over and confirm pursuant to the Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the
obligations) of the Granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to
give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the Granting party or otherwise and generally to do and receive anything that the
Granting party is or may be entitled to do or receive thereunder or with respect thereto. 
  
 “Guarantee Agreement” means any agreement between any Guarantor and the Eligible Lender Trustee providing for the payment by the Guarantor of amounts authorized to be paid pursuant to the Higher
Education Act to holders of qualifying Student Loans guaranteed in accordance with the Higher Education Act by such Guarantor. 
  

 Appendix 1-23 

 “Guarantee Payment” means any payment made by a Guarantor pursuant to a Guarantee
Agreement in respect of a Trust Student Loan. 
  
 “Guarantor” means any entity listed on Attachment B (as amended from time to time) to the Sale Agreement, the Purchase Agreements, any Additional Purchase Agreement or any Additional Sale Agreement, as applicable.

  
 “H.15(519)” means the weekly statistical
release designated as such, or any successor publication, published by the Board of Governors of the United States Federal Reserve System. 
  
 “H.15 Daily Update” means the daily update for H.15(519), available through the world wide web site of the Board of Governors of
the Federal Reserve System at http://www.federalreserve.gov/releases/h15/update, or any successor site or publications. 
  
 “Higher Education Act” means the Higher Education Act of 1965, as amended, together with any rules, regulations and interpretations
thereunder. 
  
 “Hold Notice” means a written
statement (or an oral statement confirmed in writing, which may be by e-mail) from a holder or beneficial owner of Reset Rate Notes denominated in U.S. Dollars during the then-current and immediately following Reset Periods, delivered to a
Remarketing Agent that such holder or beneficial owner desires to hold its Reset Rate Notes for the upcoming Reset Period and affirmatively agrees to receive a rate of interest of not less than the applicable All Hold Rate during that Reset Period.

  
 “Indenture” means the Indenture, dated as of
June 1, 2005, among the Eligible Lender Trustee on behalf of the Trust, the Trust and the Indenture Trustee. 
  
 “Indenture Trust Estate” means all money, instruments, rights and other property that are subject or intended to be subject to the lien
and security interest of the Indenture for the benefit of the Noteholders and, as applicable, each Swap Counterparty (including all Collateral Granted to the Indenture Trustee), including all proceeds thereof. 
  
 “Indenture Trustee” means Deutsche Bank Trust Company
Americas, a New York banking corporation, not in its individual capacity but solely as trustee under the Indenture. 
  
 “Independent” means, when used with respect to any specified Person, that the Person (a) is in fact independent of the Trust, any other
obligor upon the Notes, the Depositor and any Affiliate of any of the foregoing Persons, (b) does not have any direct financial interest or any material indirect financial interest in the Trust, any such other obligor, the Depositor or any Affiliate
of any of the foregoing Persons and (c) is not connected with the Trust, any such other obligor, the Depositor or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, placement agent, trustee, partner,
director or person performing similar functions. 
  

 Appendix 1-24 

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

  
 “Index” or “Indices” means
LIBOR, EURIBOR, GBP-LIBOR, a Commercial Paper Rate, the CMT Rate, the Federal Funds Rate, the 91-day Treasury Bill Rate, the Prime Rate or any other interest rate index specified in Schedule A to the Reset Rate Notes. 
  
 “Index Maturity” means, with respect to any Accrual Period,
the interval between Interest Rate Change Dates for each applicable Index during such Accrual Period, commencing on the first day of that Accrual Period. 
  
 “Initial Accrual Rate” means for each class of Notes and the Accrual Period commencing on the Closing Date to, but excluding, the first
Distribution Date, the rate per annum as determined on the related Determination Date, as follows: 
  
 X + [26/32 * (Y - X)] 
  
 where: 
  
 X = Three-Month LIBOR and 
 Y = Four-Month LIBOR 
  
 “Initial Cutoff Date” means June 29, 2005. 
  
 “Initial Cutoff Date Pool Balance” means, as of the Cutoff Date and with respect to the Initial Trust Student Loans, $2,225,495,949.
 
  
 “Initial Pool Balance” means the sum
of the Pool Balance of the Initial Trust Student Loans as of the Closing Date and all amounts deposited into the Supplemental Purchase Account and the Add-On Consolidation Loan Account on the Closing Date. 
  
 “Initial Remarketing Agency Agreement” means each agreement,
substantially in the form of Appendix B to the Remarketing Agreement to be entered into on each Remarketing Terms Determination Date (unless a Call Option has been exercised) among the Remarketing Agents, the Administrator and the Trust. 

 
 “Initial Reset Date” means, for the Reset Rate Notes,
January 25, 2010. 
  
 “Initial Reset Date Notice”
means the written notice delivered pursuant to Section 3(a) of the Reset Rate Note Procedures. 
  
 “Initial Trust Student Loans” means the Trust Student Loans purchased by the Trust on the Closing Date pursuant to the Sale Agreement. 
  

 Appendix 1-25 

 “Initial U.S. Dollar Reset Rate Notes” means the Class A-5 Notes. 
  
 “Insolvency Event” means, with respect to a specified
Person, (a) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of such Person or any substantial part of its property in an involuntary case under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or ordering the winding-up
or liquidation of such Person’s affairs, which decree or order remains unstayed and in effect for a period of 60 consecutive days; or (b) the commencement by such Person of a voluntary case under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the consent by such Person to the entry of an order for relief in an involuntary case under any such law, or the consent by such Person to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or the making by such Person of any general assignment for the benefit of creditors, or the failure by
such Person generally to pay its debts as such debts become due, or the taking of action by such Person in furtherance of any of the foregoing. 
  
 “Interest Rate Change Date” means for each Accrual Period, the date or dates, based on the applicable Index, on which the rate of
interest for the Reset Rate Notes, when they bear interest at a floating rate, is to be reset. 
  
 “Interest Rate Determination Date” means, for each Accrual Period, and (i) for the Reset Rate Notes that bear interest at a LIBOR-, GBP-LIBOR- or EURIBOR-based rate, the related LIBOR or EURIBOR
Determination Date, as applicable, or (ii) for the Reset Rate Notes that bear interest at a floating rate that is not LIBOR-, GBP-LIBOR- or EURIBOR-based, the applicable date or dates set forth in the Remarketing Terms Notice, on which the
applicable rate of interest to be in effect as of the next Interest Rate Change Date will be determined by the Administrator. 
  
 “Interest Rate Swap Agreement” means, with respect to the Reset Rate Notes during any Reset Period when they are denominated in U.S.
Dollars and (i) bear a fixed rate of interest (or bear interest based on LIBOR or a U.S. Commercial Paper Rate, if a Swap Agreement is to be entered into pursuant to the Reset Rate Note Procedures), or (ii) bear interest based on an index other than
LIBOR or a U.S. Commercial Paper Rate, any Swap Agreement between the Trust and an Eligible Swap Counterparty, to hedge the basis risk during the related Reset Period. 
  
 “Interest Subsidy Payments” means payments, designated as such, consisting of interest subsidies by the
Department in respect of the Trust Student Loans to the Eligible Lender Trustee on behalf of the Trust in accordance with the Higher Education Act. 
  
 “Interim Eligible Lender Trustee” means Chase Bank USA, National Association, a national banking association, not in its individual
capacity but solely as Interim Eligible Lender Trustee under the Interim Trust Agreement. “Interim Eligible Lender Trustee” shall also mean each successor Interim Eligible Lender Trustee as of the qualification of such Interim Eligible
Lender Trustee under the Interim Trust Agreement. 
  

 Appendix 1-26 

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

  
 “Investment Earnings” means, with respect to
any Distribution Date, the investment earnings (net of losses and investment expenses) on amounts on deposit in the Trust Accounts to be deposited into the Collection Account on or prior to such Distribution Date pursuant to Section 2.3(b) of the
Administration Agreement. 
  
 “Investment Premium Purchase
Account” means each account designated as such, established and maintained pursuant to Section 2.3(l) of the Administration Agreement. 
  
 “Investment Premium Purchase Account Deposit Amount” means, with respect to each Distribution Date when funds are deposited into an
Accumulation Account, an amount equal to 1.0% of the amount deposited into that Accumulation Account on such Distribution Date.  
  
 “Investment Premium Purchase Account Release Amount” means, with respect to any Distribution Date that is one year or less prior to a
Reset Date relating to the Reset Rate Notes for which funds are then on deposit in an Accumulation Account, the amount, if any, to be withdrawn from the related Investment Premium Purchase Account so that the remaining funds on deposit in such
Investment Premium Purchase Account will be equal to the lesser of (a) 1.00% of the amount on deposit in the related Accumulation Account, and (b) the amount then on deposit the related Investment Premium Purchase Account; provided that on
any Distribution Date that is also a Reset Date for the Reset Rate Notes for which amounts are then on deposit in an Accumulation Account, all Investment Premium Purchase Account Deposit Amounts relating to such Accumulation Account that remain on
deposit in the related Investment Premium Purchase Account will become part of the related Investment Premium Purchase Account Release Amount on such Distribution Date. 
  
 “Investment Reserve Account” means each account designated as such, established and maintained pursuant to
Section 2.3(m) of the Administration Agreement. 
  
 “Investment Reserve Account Required Amount” means, with respect to each Distribution Date, immediately following the date when the ratings of any Eligible Investment in an Accumulation Account has been downgraded by one or
more Rating Agencies, an amount (to the extent of Available Funds), to be set by each applicable Rating Agency in satisfaction of the Rating Agency Condition (but not to exceed the amount of the unrealized loss on the related Eligible Investment).

  
 “Issuer” means the Trust and, for purposes of
any provision contained in the Indenture and required by the TIA, each other obligor on the Notes. 
  
 “Issuer Order” and “Issuer Request” means a written order or request signed in the name of the Issuer by any one of its
Authorized Officers and delivered to the Indenture Trustee. 
  
 “LIBOR” means Three-Month LIBOR or Four-Month LIBOR, as applicable. 
  
 “LIBOR Determination Date” means, for each Accrual Period, the second Business Day before the beginning of that Accrual Period. 
  

 Appendix 1-27 

 “Lien” means a security interest, lien, charge, pledge, equity or encumbrance of any
kind, other than tax liens and any other liens, if any, which attach to the respective Trust Student Loan by operation of law as a result of any act or omission by the related Obligor. 
  
 “Liquidated Student Loan” means any defaulted Trust Student Loan liquidated by the Servicer (which shall
not include any Trust Student Loan on which Guarantee Payments are received) or which the Servicer has, after using all reasonable efforts to realize upon such Trust Student Loan, determined to charge off. 
  
 “Liquidation Proceeds” means, with respect to any Liquidated
Student Loan which became a Liquidated Student Loan during the current Collection Period in accordance with the Servicer’s customary servicing procedures, the moneys collected in respect of the liquidation thereof from whatever source, other
than Recoveries, net of the sum of any amounts expended by the Servicer in connection with such liquidation and any amounts required by law to be remitted to the Obligor on such Liquidated Student Loan. 
  
 “Loan” has the meaning set forth in Section 2 of each of the
Purchase Agreements, as applicable, and each Additional Purchase Agreement. 
  
 “Lock-In Period” means a period from the first day of such Lock-In Period (which may be expressed as a number of Business Days prior to a Distribution Date) to the immediately succeeding Interest
Payment Date during which the interest rate, Index or other calculation in effect on the first day of such Lock-In Period shall remain in effect for every day in such Lock-In Period. 
  
 “London Paying Agent” means, with respect to the Reset Rate Notes while in Foreign Exchange Mode, the
Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee specified in Section 6.11 of the Indenture and is authorized by the Eligible Lender Trustee on behalf of the Trust to make the payments to and
distributions from the Euro Account, the Pounds Sterling Account and any Other Currency Account, which authorized Person shall initially be Deutsche Bank AG London. 
  
 “Luxembourg Listing Agent” means, initially, Deutsche Bank Luxembourg SA. 
  
 “Luxembourg Paying Agent” means, initially, Deutsche Bank
Luxembourg SA. 
  
 “Minimum Purchase Amount”
means an amount that would be sufficient to (i) reduce the Outstanding Amount of each class of Notes, less the amount on deposit in any Accumulation Account with respect to the Reset Rate Notes, on such Distribution Date to zero and (ii) pay to the
respective Noteholders the Class A Noteholders’ Interest Distribution Amount and the Class B Noteholders’ Interest Distribution Amount payable on such Distribution Date. 
  
 “Monthly Servicing Payment Date” means the 25th day of each calendar month or, if such day is not a Business Day, the immediately following Business Day, commencing on July 25, 2005. 
  
 “Moody’s” means Moody’s Investors Service, Inc.

  

 Appendix 1-28 

 “Note” and “Notes” means any of the Floating Rate Notes and the Reset
Rate Notes. 
  
 “Note Depository Agreements”
means with respect to the Floating Rate Notes, the Letter of Representations, dated June 29, 2005, among the Trust, the Eligible Lender Trustee and the Indenture Trustee in favor of DTC, and with respect to the Reset Rate Notes, the Instruction
Letter from Issuer to Common Depositary, dated June 29, 2005 between the Trust and Deutsche Bank AG London. 
  
 “Note Final Maturity Date” for a class of Notes means the Class A-1 Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity
Date, the Class A-4 Maturity Date, the Class A-5 Maturity Date or the Class B Maturity Date, as applicable. 
  
 “Note Interest Shortfall” means the Class A Note Interest Shortfall, if any, and/or the Class B Note Interest Shortfall, if any, as
applicable. 
  
 “Note Owner” means, with respect
to a Book-Entry Note, the Person who is the owner of such Book-Entry Note, as reflected on the books of the applicable Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). 
  
 “Note Pool Factor” means, as of the close of business on a Distribution Date, a seven-digit decimal figure equal to the Outstanding
Amount of a class of Notes divided by the original Outstanding Amount of such class of Notes. The Note Pool Factor for each class will be 1.0000000 as of the Closing Date; thereafter, the Note Pool Factor for each class will decline to reflect
reductions in the Outstanding Amount of that class of Notes. 
  
 “Note Rates” means, with respect to any Accrual Period, the Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Class A-5 Rate and the Class B Rate for such Accrual Period, collectively.

  
 “Note Register” and “Note
Registrar” have the respective meanings specified in Section 2.4 of the Indenture. 
  
 “Noteholder” means a Floating Rate Noteholder, a Class A Noteholder, a Reset Rate Noteholder or a Class B Noteholder, as the context requires. 
  
 “Notes” means the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes, the Class A-4 Notes, the Class A-5 Notes and the Class B Notes, collectively. 
  
 “Notice Date” means, for the Reset Rate Notes, 12:00 p.m. (noon), New York City time, on the sixth day prior to the Reset Date for that class. 
  
 “Obligor” on a Trust Student Loan means the borrower or
co-borrowers of such Trust Student Loan and any other Person who owes payments in respect of such Trust Student Loan, including the Guarantor thereof and, with respect to any Interest Subsidy Payment or Special Allowance Payment, if any, thereon,
the Department. 
  

 Appendix 1-29 

 “Officers’ Certificate” means (i) in the case of the Trust, a certificate signed by
any two Authorized Officers of the Eligible Lender Trustee, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 11.1 of the Indenture, and delivered to the Indenture Trustee, and (ii) in the
case of the Depositor, the Administrator or the Servicer, a certificate signed by any two Authorized Officers of the Depositor, the Administrator or the Servicer, as applicable. 
  
 “Opinion of Counsel” means (i) with respect to the Trust, one or more written opinions of counsel who may,
except as otherwise expressly provided in the Indenture, be employees of or counsel to the Eligible Lender Trustee, the Trust, the Depositor or an Affiliate of the Depositor and who shall be satisfactory to the Indenture Trustee, and which opinion
or opinions shall be addressed to the Indenture Trustee as Indenture Trustee, shall comply with any applicable requirements of Section 11.1 of the Indenture and shall be in form and substance satisfactory to the Indenture Trustee, and (ii) with
respect to the Depositor, the Administrator or the Servicer, one or more written opinions of counsel who may be an employee of or counsel to the Depositor, the Administrator or the Servicer, which counsel shall be acceptable to the Indenture Trustee
and the Eligible Lender Trustee. 
  
 “Origination
Fee” means any origination fee payable to the Department by the lender with respect to any Trust Student Loan. 
  
 “Other Currency Account” means each account designated as such, established and maintained pursuant to Section 2.3(n) of the
Administration Agreement. 
  
 “Outstanding”
means, as of any date of determination, all Notes theretofore authenticated and delivered under the Indenture except: 
  
 (a) Notes theretofore cancelled by the Note Registrar or delivered to the Note Registrar for cancellation; 
  
 (b) Notes, or portions thereof, for which payment has been made to the
applicable Noteholders in reduction of the outstanding principal balance thereof or for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the Noteholders thereof (excluding
for such purpose any amounts on deposit in any Accumulation Account); provided, however, that if such Notes are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture; and 
  
 (c) Notes in exchange for or in lieu of other Notes which have been
authenticated and delivered pursuant to the Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a bona fide purchaser; provided that in determining whether the Noteholders of the requisite
Outstanding Amount of the Notes have given any request, demand, authorization, direction, notice, consent or waiver hereunder or under any other Basic Document, Notes owned by the Trust, any other obligor upon the Notes, the Depositor or any
Affiliate of any of the foregoing Persons shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Notes that a Responsible Officer of the Indenture Trustee either actually knows to be so owned 

  

 Appendix 1-30 

 
or has received written notice thereof shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Indenture Trustee the pledgee’s right so to act with respect to such Notes and that the pledgee is not the Trust, any other obligor upon the Notes, the Depositor or any Affiliate of any of the
foregoing Persons. 
  
 “Outstanding Amount”
means, as of any date of determination, the aggregate principal balance of all the Notes or the applicable class or classes of Notes, as the case may be, Outstanding at such date of determination; provided, however, that if the Reset
Rate Notes are then in Foreign Exchange Mode, the Outstanding Amount shall be based on the U.S. Dollar Equivalent Principal Amount of the Reset Rate Notes. 
  
 “Paying Agent” means, with respect to the Notes (other than the Reset Rate Notes when they are denominated in a currency other than U.S.
Dollars), the Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee specified in Section 6.11 of the Indenture and is authorized by the Eligible Lender Trustee, on behalf of the Trust, to make the
payments to and distributions from the Collection Account and payments of principal of and interest and any other amounts owing on the Notes on behalf of the Trust. With respect to the Reset Rate Notes denominated in a currency other than U.S.
Dollars, Paying Agent means the London Paying Agent and the Luxembourg Paying Agent. 
  
 “Person” means any individual, corporation, estate, partnership, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated organization, limited
liability company, limited liability partnership or government or any agency or political subdivision thereof. 
  
 “Physical Property” has the meaning assigned to such terms in the definition of “Delivery” above. 
  
 “Pool Balance” for any date means the aggregate principal
balance of the Trust Student Loans on that date (including accrued interest that is expected to be capitalized) as such balance has been reduced through such date by: 
  
 (a) all payments received by the Trust through that date from borrowers, the Guarantors and the Department; 
  
 (b) all amounts received by the Trust through that date from repurchases of
the Trust Student Loans by SLM ECFC, VG Funding, or the Depositor, as applicable, or purchases by the Servicer; 
  
 (c) all Liquidation Proceeds and Realized Losses on the Trust Student Loans liquidated through that date; 
  
 (d) the amount of any adjustments to the outstanding principal balances of
the Trust Student Loans that the Servicer makes under the Servicing Agreement through that date; and 
  

 Appendix 1-31 

 (e) the amount by which Guarantor reimbursements of principal on defaulted Trust Student Loans through
that date are reduced from 100% to 98%, or other applicable percentage, as required by the risk sharing provisions of the Higher Education Act. 
  
 “Pounds Sterling Account” means any account designated as such, established and maintained pursuant to Section 2.3(p) of the
Administration Agreement. 
  
 “Predecessor Note”
means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purpose of this definition, any Note authenticated and delivered under Section 2.5
of the Indenture and in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen Note. 
  
 “Primary Servicing Fee” for any Monthly Servicing Payment Date has the meaning specified in Attachment A to
the Servicing Agreement, and shall include any such fees from prior Monthly Servicing Payment Dates that remain unpaid. 
  
 “Prime Rate” means, for any relevant Interest Rate Determination Date prior to each Interest Rate Change Date, the prime rate or base
lending rate on that date, as published in H.15(519), prior to 3:00 p.m., New York City time, on that Interest Rate Determination Date under the heading “Bank Prime Loan.” The Administrator will observe the following procedures if the
Prime Rate cannot be determined as described above: (i) if the rate described above is not published in H.15(519) prior to 3:00 p.m., New York City time, on the relevant Interest Rate Determination Date unless the calculation is made earlier and the
rate was available from that source at that time, then the Prime Rate will be the rate for that Interest Rate Determination Date, as published in H.15 Daily Update or another recognized electronic source for displaying such rate opposite the caption
“Bank Prime Loan”, (ii) if the above rate is not published in either H.15(519), H.15 Daily Update or another recognized electronic source for displaying such rate by 3:00 p.m., New York City time, on the relevant Interest Rate
Determination Date, then the Administrator will determine the Prime Rate to be the average of the rates of interest publicly announced by each bank that appears on the Reuters screen designated as “USPRIME1” as that bank’s prime rate
or base lending rate as in effect on that Interest Rate Determination Date, (iii) if fewer than four rates appear on the Reuters screen USPRIME1 page on the relevant Interest Rate Determination Date, then the Prime Rate will be the average of the
prime rates or base lending rates quoted, on the basis of the actual number of days in the year divided by a 360-day year, as of the close of business on that Interest Rate Determination Date by three major banks in New York City selected by the
Administrator, or (iv) if the banks selected by the Administrator are not quoting as mentioned above, the Prime Rate will remain the prime rate then in effect on that Interest Rate Determination Date. 
  
 “Principal Distribution Amount” means, (i) with respect to
the initial Distribution Date, the amount by which the sum of the Outstanding Amount of the Notes exceeds the Adjusted Pool Balance for that Distribution Date, and (ii) with respect to each subsequent Distribution Date, the sum of the amount by
which the Adjusted Pool Balance for the preceding Distribution Date exceeds the Adjusted Pool Balance for that Distribution Date. 
  

 Appendix 1-32 

 “Proceeding” means any suit in equity, action at law or other judicial or administrative
proceeding. 
  
 “Purchase Agreement” means either
the SLM ECFC Purchase Agreement or the VG Funding Purchase Agreement, each dated as of June 29, 2005. 
  
 “Purchase Amount” with respect to any Trust Student Loan means the amount required to prepay in full such Trust Student Loan under the
terms thereof including all accrued and unpaid interest thereon. 
  
 “Purchased Student Loan” means a Trust Student Loan which is, as of the close of business on the last day of a Collection Period, purchased by the Servicer pursuant to Section 3.5 of the Servicing Agreement or repurchased
by the Depositor pursuant to Section 6 of the Sale Agreement, repurchased by SLM ECFC pursuant to Section 6 of the SLM ECFC Purchase Agreement, repurchased by VG Funding pursuant to Section 6 of the VG Funding Purchase Agreement or sold to another
eligible lender holding one or more Serial Loans with respect to such Trust Student Loan pursuant to Section 3.11E of the Servicing Agreement. 
  
 “QIB” means a “qualified institutional buyer” as defined in Rule 144A under the Act. 
  
 “Quarterly Funding Amount” means, for the Reset Rate Notes,
for any Distribution Date that is (1) more than one year before the next Reset Date, zero and (2) one year or less before the next Reset Date, an amount to be deposited into the Remarketing Fee Account for the Reset Rate Notes so that the amount
therein in respect of that class equals the Quarterly Required Amount for that class; provided, however, that if on any Distribution Date that is not a Reset Date, the amount on deposit in the Remarketing Fee Account in respect of that
class is greater than the Quarterly Required Amount for that class, such excess will be transferred to the Collection Account and included in Available Funds for that Distribution Date. 
  
 “Quarterly Required Amount” means, for the Reset Rate Notes, (1) on any Reset Date, the Reset Period Target
Amount for that class or (2) on a Distribution Date that is one year or less before the next Reset Date (x) the Reset Period Target Amount multiplied by (y) five (5) minus the number of Distribution Dates remaining until the next Reset Date
(excluding the current Distribution Date and including the next Reset Date), divided by (z) five (5). 
  
 “Rating Agency” means Moody’s, S&P and Fitch. If any such organization or successor thereto is no longer in existence,
“Rating Agency” with respect to such organization shall be a nationally recognized statistical rating organization or other comparable Person designated by the Administrator, notice of which designation shall be given to the Indenture
Trustee, the Eligible Lender Trustee and the Servicer. 
  
 “Rating Agency Condition” means, with respect to any intended action, that each Rating Agency then rating a class of Notes shall have been given 10 days’ prior written notice thereof and that each such Rating Agency
shall have notified the Administrator, the Servicer, the Eligible Lender Trustee, the Indenture Trustee and the Remarketing Agents, if applicable, in writing that such proposed action will not result in and of itself in the reduction or withdrawal
of its then-current rating of any class of Notes. 
  

 Appendix 1-33 

 “Realized Loss” means the excess of the principal balance, including any interest that
had been or had been expected to be capitalized, of any Liquidated Student Loan over Liquidation Proceeds for that Liquidated Student Loan to the extent allocable to principal, including any interest that had been or had been expected to be
capitalized. 
  
 “Record Date” means, with
respect to a Distribution Date or Redemption Date and for each class of Notes, the close of business on the day preceding such Distribution Date or Redemption Date. 
  
 “Recoveries” means moneys collected from whatever source with respect to any Liquidated Student Loan which
was written off in prior Collection Periods or during the current Collection Period, net of the sum of any amounts expended by the Servicer for the account of any Obligor and any amounts required by law to be remitted to any Obligor. 
  
 “Redemption Date” means in the case of a payment to
Noteholders pursuant to Section 10.1 of the Indenture, the Distribution Date specified pursuant to Section 10.1 of the Indenture. 
  
 “Redemption Price” means an amount equal to the Outstanding Amount of the Notes, plus accrued and unpaid interest thereon at the
applicable Note Rates to but excluding the Redemption Date. 
  
 “Reference Banks” means, with respect to (i) LIBOR, four major banks in the London interbank market for deposits in U.S Dollars selected by the Administrator, (ii) EURIBOR, four major banks in the Euro-zone interbank market
for deposits in Euros selected by the Administrator and (iii) GBP-LIBOR, four major banks in the London interbank market for deposits in Pounds Sterling selected by the Administrator. 
  
 “Registrar” means the Excess Distribution Certificate Registrar and/or the Note Registrar, as applicable.

  
 “Remarketing Agency Agreement” means the
collective reference to an Initial Remarketing Agency Agreement and the Supplemental Remarketing Agency Agreement. 
  
 “Remarketing Agent” means, initially, each of Citigroup Global Markets Inc. and Goldman, Sachs & Co. The Administrator, in its sole
discretion, may change any Remarketing Agent for the Reset Rate Notes for any Reset Period at any time on or before a Remarketing Terms Determination Date. 
  
 “Remarketing Agreement” means the Remarketing Agreement dated as of June 29, 2005 among the Remarketing Agents, the Administrator and the
Trust, as amended or supplemented from time to time. 
  
 “Remarketing Fee Account” means the account designated as such, established and maintained pursuant to Section 2.3(i) of the Administration Agreement. 
  
 “Remarketing Prospectus” as described in Section 7(e)(i) of the Remarketing Agreement. 
  

 Appendix 1-34 

 “Remarketing Terms Determination Date” means, for the Reset Rate Notes, not later than
3:00 p.m., New York City time, on the eighth Business Day prior to the applicable Reset Date. 
  
 “Remarketing Terms Notice” means the notice delivered by the Remarketing Agents to a the Reset Rate Noteholders, the Indenture Trustee, the Rating Agencies and the applicable Clearing Agencies on each
Remarketing Terms Determination Date containing the information set forth in the Reset Rate Note Procedures (Appendix A-2 to the Indenture). 
  
 “Reserve Account” means the account designated as such, established and maintained pursuant to Section 2.3(g) of the Administration
Agreement. 
  
 “Reserve Account Initial Deposit”
means $5,588,740. 
  
 “Reset Date” means a
Distribution Date on which certain terms for the Reset Rate Notes may be changed in accordance with the Reset Rate Note Procedures (Appendix A-2 to the Indenture). 
  
 “Reset Period” means, with respect to the Reset Rate Notes, a period of at least three months (or any other
longer duration that is a multiple of three months) that will always end on the day before a Distribution Date, which such Distribution Date will be the next Reset Date; provided that no such Reset Period may end after the day before the
Reset Rate Notes Maturity Date. 
  
 “Reset Period Target
Amount” means, for the Reset Rate Notes, for any Distribution Date that is (1) more than one year before the next Reset Date, zero, and (2) one year or less before the next Reset Date, the highest remarketing fee payable to the Remarketing
Agents for the Reset Rate Notes (not to exceed 0.35% of the maximum principal balance of the Reset Rate Notes that could be remarketed) on the next Reset Date as determined by the Administrator based on the assumed weighted average life of the Reset
Rate Notes and the maximum remarketing fee set forth on a schedule attached to the Remarketing Agreement, as such schedule may be amended from time to time. 
  
 “Reset Rate Note” means any Class A-5 Note. 
  
 “Reset Rate Note Procedures” means Appendix A-2 to the Indenture. 
  
 “Reset Rate Noteholder” means the Person in whose name a Reset Rate Note is registered in the Note
Register. 
  
 “Reset Rate Notes” means the Class
A-5 Notes. 
  
 “Reset Rate Notes Maturity Date”
means the Class A-5 Maturity Date. 
  
 “Responsible
Officer” means, with respect to the Indenture Trustee, any officer within the Corporate Trust Office of the Indenture Trustee, including any Vice President, Assistant Vice President, Assistant Treasurer, Assistant Secretary, or any other
officer of the Indenture Trustee customarily performing functions similar to those performed by any of the above designated officers, with direct responsibility for the administration of the Indenture and the other Basic 

  

 Appendix 1-35 

 
Documents on behalf of the Indenture Trustee and also, with respect to a particular matter, any other officer to whom such matter is referred because of such
officer’s knowledge of and familiarity with the particular subject. 
  
 “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. 
  
 “Sale Agreement” means the Sale Agreement Master Securitization Terms Number 1000, dated as of June 29, 2005, among the Eligible Lender
Trustee on behalf of the Trust, the Trust, the Interim Eligible Lender Trustee and the Depositor, and the sale agreement or agreements entered into thereunder. 
  

“Schedule of Trust Student Loans” means the listing of the Trust Student Loans set forth in Schedule A to the Indenture and the Bill
of Sale (which Schedule may be in the form of microfiche). 
  
 “Schedule Replacement Order” means an Issuer Order replacing Schedule A to the Reset Rate Notes to be delivered with respect to the Reset Date. 
  
 “Servicer” means Sallie Mae, Inc., in its capacity as servicer of the Trust Student Loans. 
  
 “Servicer Default” means an event specified in Section 5.1
of the Servicing Agreement. 
  
 “Servicer Distribution
Date” has the meaning specified in the Servicing Agreement. 
  
 “Servicer’s Report” means any report of the Servicer delivered pursuant to Section 3.1(a) of the Administration Agreement, substantially in the form acceptable to the Administrator. 
  
 “Servicing Agreement” means the Servicing Agreement, dated
as of June 29, 2005, among the Trust, the Eligible Lender Trustee, the Servicer, the Administrator and the Indenture Trustee. 
  
 “Servicing Fee” has the meaning specified in Attachment A to the Servicing Agreement. 
  
 “SLM ECFC” means SLM Education Credit Finance Corporation.

  
 “SLM ECFC Purchase Agreement” means the
Purchase Agreement Master Securitization Terms Number 1000, dated as of June 29, 2005, among SLM ECFC, the Interim Eligible Lender Trustee and the Depositor, as well as each purchase agreement entered into thereunder. 
  
 “SLS Loan” means a Trust Student Loan designated as such
that is made under the Supplemental Loans for Students Program in accordance with the Higher Education Act. 
  
 “Special Allowance Payments” means payments, designated as such, consisting of effective interest subsidies by the Department in respect
of the Trust Student Loans to the Eligible Lender Trustee on behalf of the Trust in accordance with the Higher Education Act. 
  

 Appendix 1-36 

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

  

	 	(a)	0.25% of the sum of (i) the Pool Balance and (ii) the amount, if any, on deposit in the Add-On Consolidation Loan Account (excluding amounts in such account that will be Available
Funds on the next Distribution Date), each as of the close of business on the last day of the related Collection Period; and 

  

	 	(b)	$3,353,244; 

  
 provided that in no event will that balance exceed the Outstanding Amount. For these purposes, if the Reset Rate Notes are structured not to receive a payment of principal until the end of the related Reset
Period, the Outstanding Amount, or its U.S. Dollar Equivalent Principal Amount, as applicable, of the Reset Rate Notes will be reduced by any amounts (less any Investment Earnings) on deposit in the related Accumulation Account for the Reset Rate
Notes. 
  
 “Spread” means the percentage,
determined by the Remarketing Agents with respect to the Reset Rate Notes if they are to bear a floating rate of interest, in excess of or below the applicable interest rate Index that will be applicable to the Reset Rate Notes during any Reset
Period after the initial Reset Period so as to result in an interest rate that, in the reasonable opinion of the Remarketing Agents, will enable all of the tendered Reset Rate Notes of that class to be remarketed by the Remarketing Agents at 100% of
the Outstanding Amount thereof. 
  
 “Spread Determination
Date” means, for any class of Reset Rate Notes, not later than 3:00 p.m., New York City time, on the third Business Day prior to the applicable Reset Date. 
  
 “Spread Determination Notice” means the notice delivered by the Remarketing Agents to the Noteholders of
the Reset Rate Notes, the Indenture Trustee, the Rating Agencies, the Clearing Agencies and, if the Reset Rate Notes are then listed on the Luxembourg Stock Exchange, the Luxembourg Stock Exchange on each Spread Determination Date containing the
information set forth in the Reset Rate Note Procedures (Appendix A-2 to the Indenture). 
  
 “Stafford Loan” means a Trust Student Loan designated as such that is made under the Stafford Loan Program in accordance with the Higher Education Act. 
  
 “State” means any one of the 50 States of the United States
of America or the District of Columbia. 
  
 “Statistical
Cutoff Date” means May 30, 2005. 
  
 “Stepdown
Date” means the earlier to occur of (i) the October 2011 Distribution Date or (ii) the first date on which no Class A Notes remain Outstanding. For this purpose, the Outstanding Principal Balance of the Reset Rate Notes will be deemed
reduced by any amounts (other than Investment Earnings) on deposit in any related Accumulation Account. 
  
 “Student Loans” means education loans to students and parents of students under the Federal Family Education Loan Program. 
  
 “Subsequent Cutoff Date” with respect to each Additional
Trust Student Loan or Substituted Trust Student Loan has the meaning set forth in the related Additional Purchase Agreement and Additional Sale Agreement. 
  

 Appendix 1-37 

 “Substituted Trust Student Loan” means each Eligible Loan substituted by the Depositor
pursuant to Section 6(B) of the Sale Agreement and each related Additional Sale Agreement. 
  
 “Successor Administrator” has the meaning specified in Section 3.7(e) of the Indenture. 
  
 “Successor Servicer” has the meaning specified in Section 3.7(e) of the Indenture. 
  
 “Supplemental Interest Account” means any account designated
as such, established and maintained pursuant to Section 2.3(k) of the Administration Agreement. 
  
 “Supplemental Interest Account Deposit Amount” means, with respect to any Distribution Date when the Reset Rate Notes are then structured
not to receive a payment of principal until the end of the Reset Period, the lesser of: 
  

	 	(a)	the product of: 

  
 (1) the difference between (x) the weighted average of the LIBOR-based rates (as determined on the LIBOR Determination Date immediately preceding that
Distribution Date) that will be payable by the Trust to any related Swap Counterparties on the next Distribution Date, or the LIBOR-based rate (as determined on the LIBOR Determination Date immediately preceding that Distribution Date) that will be
payable by the Trust to the related Noteholders on the next Distribution Date, as applicable, and (y) an assumed rate of Investment Earnings that satisfies the Rating Agency Condition, 
  
 (2) the amount on deposit in the related Accumulation Account immediately after that Distribution Date, and 
  
 (3) the actual number of days from that Distribution Date to the next Reset
Date for the Reset Rate Notes, divided by 360; and 
  

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

  
 “Supplemental Purchase Account” means an account designated as such, established and maintained pursuant to Section 2.3(q) of the
Administration Agreement. 
  
 “Supplemental Purchase
Account Initial Deposit” means $6,320,499.34 which is equal to the excess, if any, of (x) the Pool Balance as of the Statistical Cutoff Date over (y) the Initial Cutoff Date Pool Balance; provided that such amount is not in excess of 5% of
the Pool Balance as of the Statistical Cutoff Date.  
  
 “Supplemental Purchase Period” means the period beginning on the Closing Date and ending ten (10) business days later on July 13, 2005. 
  
 “Supplemental Remarketing Agency Agreement” means each agreement, substantially in the form of Appendix C
to the Remarketing Agreement to be entered into on each Spread Determination Date (unless a Call Option has been exercised or a Failed Remarketing has been declared) among the Remarketing Agents, the Administrator and the Trust. 
  

 Appendix 1-38 

 “Swap Agreement” means the applicable ISDA Master Agreement, and each related swap
schedule and/or Swap Confirmation with respect to each Currency Swap Agreement and each Interest Rate Swap Agreement to be entered into from time to time by the Administrator or the Eligible Lender Trustee in either case solely on behalf of the
Trust and an Eligible Swap Counterparty, pursuant to the terms and conditions set forth in the Reset Rate Note Procedures. 
  
 “Swap Confirmation” means each swap confirmation relating to a Swap Agreement. 
  
 “Swap Counterparty” means each Eligible Swap Counterparty
from time to time party to a Swap Agreement, each Initial Currency Swap Counterparty (with respect to each Initial Currency Swap Agreement) and the Interest Rate Cap Swap Counterparty (with respect to the Interest Rate Cap Agreement). 
  
 “Swap Interest Payments” means, with respect to each
Distribution Date, the amount payable to the related Swap Counterparty by the Trust as a quarterly premium payment pursuant to the related Swap Agreement. 
  
 “Swap Payments” means, with respect to each Distribution Date, the amount, if any, payable to a Swap Counterparty by the Trust for such
date, including amounts due and unpaid from prior Distribution Dates (other than Swap Termination Payments), as specified in the applicable Swap Agreement. 
  
 “Swap Receipts” means, with respect to each Distribution Date, the amount required to be received from the related Swap Counterparty by
the Trust for such date (other than Swap Termination Payments), as specified in the related Swap Agreement. 
  
 “Swap Termination Date” means the date on which Swap Agreement terminates in accordance with its terms. 
  
 “Swap Termination Payments” shall have the meaning set forth
in each Swap Agreement. 
  
 “TARGET” means the
Trans-European Automated Real-time Gross Settlement Express Transfer System. 
  
 “Telerate Page 248” means the display page so designated on the Moneyline Telerate Service (or such other page as may replace that page on that service for the purpose of displaying comparable rates
or prices). 
  
 “Telerate Page 3750” means the
display page so designated on the Moneyline Telerate Service (or such other page as may replace that page on that service for the purpose of displaying comparable rates or prices). 
  
 “Telerate Page 7051” means the display page so designated on the Moneyline Telerate Service (or such other
page as may replace that page on that service for the purpose of displaying comparable rates or prices). 
  

 Appendix 1-39 

 “Telerate Page 7052” means the display page so designated on the Moneyline Telerate
Service (or such other page as may replace that page on that service for the purpose of displaying comparable rates or prices). 
  
 “Three-Month LIBOR” and “Four-Month LIBOR” means, with respect to any Accrual Period, the London interbank offered rate for
deposits in U.S. Dollars having the Index Maturity which appears on Telerate Page 3750 as of 11:00 a.m. London time, on the related LIBOR Determination Date. If this rate does not appear on Telerate Page 3750, the rate for that day will be
determined on the basis of the rates at which deposits in U.S. Dollars, having the Index Maturity and in a principal amount of not less than U.S. $1,000,000, are offered at approximately 11:00 a.m., London time, on that LIBOR Determination Date, to
prime banks in the London interbank market by the Reference Banks. The Administrator will request the principal London office of each Reference Bank to provide a quotation of its rate. If the Reference Banks provide at least two quotations, the rate
for that day will be the arithmetic mean of the quotations. If the Reference Banks provide fewer than two quotations, the rate for that day will be the arithmetic mean of the rates quoted by major banks in New York City, selected by the
Administrator, at approximately 11:00 a.m., New York time, on that LIBOR Determination Date, for loans in U.S. Dollars to leading European banks having the Index Maturity and in a principal amount of not less than U.S. $1,000,000. If the banks
selected as described above are not providing quotations, LIBOR in effect for the applicable Accrual Period will be LIBOR for the specified maturity in effect for the previous Accrual Period. 
  
 “Transfer” an offer, sale, pledge, transfer or other
disposition of a Note or any interest therein. 
  
 “Transfer Date” has the meaning specified in Section 5.2(a) of the Administration Agreement. 
  
 “Treasury Regulations” means regulations, including proposed or temporary regulations, promulgated under the Code. References in any
document or instrument to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations or other successor Treasury Regulations. 
  
 “Trigger Event” means, on any Distribution Date while any of
the Class A Notes are outstanding, the Outstanding Amount of the Notes, less any amounts on deposit in any Accumulation Account (other than Investment Earnings), after giving effect to distributions to be made on that Distribution Date, would exceed
the Adjusted Pool Balance as of the end of the related Collection Period. 
  
 “Trust” means SLM Student Loan Trust 2005-5, a Delaware statutory trust established pursuant to the Trust Agreement. 
  
 “Trust Account Property” means the Trust Accounts, all cash and investments held from time to time in any
Trust Account (whether in the form of deposit accounts, Physical Property, book-entry securities, uncertificated securities or otherwise), including the Reserve Account Initial Deposit, the Capitalized Interest Account Initial Deposit, the
Supplemental Purchase Account Initial Deposit, the Add-On Consolidation Loan Account Initial Deposit, the Collection Account Initial Deposit and all earnings on and proceeds of the foregoing. 
  

 Appendix 1-40 

 “Trust Accounts” has the meaning specified in Section 2.3(b) of the Administration
Agreement. 
  
 “Trust Agreement” means the
short-form trust agreement, dated as of June 9, 2005, between the Depositor and the Eligible Lender Trustee, as amended and restated pursuant to an Amended and Restated Trust Agreement, dated as of June 29, 2005 among the Depositor, the Eligible
Lender Trustee and the Indenture Trustee. 
  
 “Trust
Auction Date” has the meaning specified in Section 4.4 of the Indenture. 
  
 “Trust Estate” means all right, title and interest of the Trust (or the Eligible Lender Trustee on behalf of the Trust) in and to the property and rights sold, transferred and assigned to the Trust
pursuant to the Sale Agreement and any Additional Sale Agreement, all funds on deposit from time to time in the Trust Accounts and all other property of the Trust from time to time, including any rights of the Eligible Lender Trustee and the Trust
pursuant to the Trust Agreement, the Administration Agreement, the Servicing Agreement, any Swap Agreements and any Eligible Repurchase Obligations. 
  
 “Trust Indenture Act” or “TIA” means the Trust Indenture Act of 1939 as in force on the date hereof, unless otherwise
specifically provided. 
  
 “Trust Student Loan”
means any student loan that is listed on the Schedule of Initial Trust Student Loans on the Closing Date, plus any Additional Trust Student Loan, plus any student loan that is permissibly substituted for a Trust Student Loan by the Depositor
pursuant to Section 6 of the Sale Agreement or pursuant to Section 6 of an Additional Sale Agreement, or by the Servicer pursuant to Section 3.5 of the Servicing Agreement, but shall not include any Purchased Student Loan following receipt by or on
behalf of the Trust of the Purchase Amount with respect thereto or any Liquidated Student Loan following receipt by or on behalf of the Trust of Liquidation Proceeds with respect thereto or following such Liquidated Student Loan having otherwise
been written off by the Servicer. 
  
 “Trust Student Loan
Files” means the documents specified in Section 2.1 of the Servicing Agreement. 
  
 “UCC” means, unless the context otherwise requires, the Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended from time to time. 
  
 “Underwriter” means each of Citigroup Global Markets Inc.,
Goldman, Sachs & Co., Barclays Capital Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wachovia Capital Markets, LLC. 
  
 “U.S. Dollar Equivalent Principal Amount” means, with respect to the Reset Rate Notes while in Foreign Exchange Mode, the U.S. Dollar
equivalent of the Outstanding Amount of the Reset Rate Notes in Foreign Exchange Mode as of the date of determination based on the exchange rate provided in the related Currency Swap Agreement. 
  

 Appendix 1-41 

 “VG Funding” means VG Funding, LLC. 
  
 “VG Funding Eligible Lender Trustee” means Chase Bank USA,
National Association, a national banking association, not in its individual capacity but solely as interim eligible lender trustee for the benefit of VG Funding under the VG Funding Interim Trust Agreement. 
  
 “VG Funding Interim Trust Agreement” means the Interim Trust
Agreement, dated as of June 1, 2005, between VG Funding and the VG Funding Eligible Lender Trustee. 
  
 “VG Funding Purchase Agreement” means the Purchase Agreement Master Securitization Terms Number 1000, dated as of June 29, 2005 among VG
Funding, the VG Funding Interim Eligible Trustee, the Interim Eligible Lender Trustee and the Depositor, as well as each purchase agreement entered into thereunder. 
  

 Appendix 1-42 

 APPENDIX A-2 
  
 RESET RATE NOTE PROCEDURES 
  
 Section 1. Definitions: All terms which are defined in Appendix A-1 shall have the same meanings in this
Appendix A-2. 
  
 Section 2. Interest Rates; Principal
Payments: (a) The Reset Rate Notes will bear interest for each related Reset Period at the rate set forth on Schedule A attached to the Reset Rate Notes as determined in accordance with Section 2(b) below; provided that during their
initial Reset Period, the Reset Rate Notes will bear interest from the Closing Date through and including the Initial Reset Date at the rate set forth in the first sentence of the definition of “Class A-5 Rate.” Interest on the Reset Rate
Notes shall be payable by the Trust with respect to each Distribution Date at the priority level set forth in Section 2.8(d) of the Administration Agreement; provided that if interest due to the Reset Rate Notes is payable through a Swap
Agreement, the related Swap Interest Payments will be payable by the Trust to the related Swap Counterparty, and by the Swap Counterparty to the Trust (for payment to the Reset Rate Noteholders), as described in Section 10 below. 
  
 (b) After the initial Reset Period, the Reset Rate Notes may be reset to bear
either a fixed or floating rate of interest at the option of the Remarketing Agents, in consultation with the Administrator. The interest rate of the Reset Rate Notes will be reset as of each related Reset Date as determined by (i) the Remarketing
Agents, in consultation with the Administrator, with respect to (A) the length of the related Reset Period, (B) whether the rate is fixed or floating and (x) if floating, the applicable Index, or (y) if fixed, the applicable pricing benchmark, (C)
the applicable Day Count Basis, (D) the applicable currency denomination, i.e., U.S. Dollars, Euros, Pounds Sterling or another non-U.S. Dollar currency, (E) if in Foreign Exchange Mode, the applicable Distribution Dates on which interest will be
paid to the Reset Rate Noteholders, if other than quarterly, (F) the applicable Interest Rate Determination Dates within each Accrual Period, (G) the interval between Interest Rate Change Dates during each Accrual Period and (H) if applicable, the
related All Hold Rate, and (ii) the Remarketing Agents (in their sole determination) with respect to the setting of the (A) fixed rate of interest or (B) Spread to the chosen Index, as applicable. 
  
 (c) In the event that the Reset Rate Notes are reset (i) to bear (or continue
to bear) interest at a floating rate, (ii) to bear (or continue to bear) a fixed rate of interest and/or (iii) to be denominated (or continue to be denominated) in a currency other than U.S. Dollars, and the Remarketing Agents, in consultation with
the Administrator determine that it would be in the best interest of the Trust based on existing market conditions to enter into one or more Swap Agreements, the Administrator will be responsible for arranging, on behalf of the Trust, one or more
Swap Agreements to hedge the basis risk and/or currency exchange risk (as applicable) and, together with the Remarketing Agents, for selecting the Swap Counterparties thereto in accordance with the procedures set forth in Section 10(d) below. The
Reset Rate Notes will not be reset (or continue) to bear interest at a floating rate that is not based on LIBOR or a Commercial Paper Rate, at a fixed rate or to be denominated in a currency other than U.S. Dollars unless one or more Swap Agreements
are entered into as of the related Reset Date that results in the Rating Agency Condition being satisfied. In connection with each Swap Agreement, the Remarketing Agents shall solicit bids from Eligible Swap Counterparties in accordance with the
procedures set forth in Section 10(d) below. 
  

 Appendix A-2-1 

 (d) The Reset Rate Notes shall be entitled either (i) to receive payments of principal in reduction of
their Outstanding Amount on each Distribution Date at the priority level set forth in Section 2.8(f) of the Administration Agreement or (ii) if they are then structured not to receive a payment of principal until the end of their Reset Period, to
receive allocations of principal at the priority level set forth in Section 2.8(f) of the Administration Agreement on each Distribution Date; provided, however, that such amounts referred to in this clause (ii) shall not be paid in
reduction of the Outstanding Amount of the Reset Rate Notes, and instead such amounts shall be deposited into the Accumulation Account for payment to the Reset Rate Noteholders or the related Currency Swap Counterparty, as applicable, on or about
the next Reset Date as set forth in Section 11(a) below. 
  
 Section 3. End of Reset Period Notice: (a) Unless the holder of the Call Option has delivered the Call Option Notice, the Administrator, not less than fifteen nor more than thirty calendar days prior to any Remarketing Terms
Determination Date, will (i) give written notice (including facsimile or other electronic transmission, if permitted pursuant to the recipient’s standard procedures) to the applicable Clearing Agencies and the Luxembourg Stock Exchange (for so
long as the Reset Rate Notes are listed on such exchange), with a copy to the Indenture Trustee, notifying them of the upcoming Reset Date and the identities of the Remarketing Agents and stating whether tender is deemed mandatory or optional for
the Reset Rate Notes on that Reset Date (the “Initial Reset Date Notice”), (ii) request that each Clearing Agency notify its participants of (1) the contents of the Initial Reset Date Notice, (2) the Remarketing Terms Notice to be given on
the Remarketing Terms Determination Date pursuant to Section 4(d) below, (3) the Spread Determination Notice to be given on the Spread Determination Date pursuant to Section 9(e) below, and (4) if applicable, the procedures concerning the timely
delivery of a Hold Notice pursuant to Section 8 below that must be followed if any beneficial owner of the Reset Rate Notes wishes to retain its Reset Rate Notes. For so long as the Reset Rate Notes are listed on the Luxembourg Stock Exchange, a
copy of such notices will be sent to the Luxembourg Stock Exchange and each of the Remarketing Terms Notice and the Spread Determination Notice will also be published in a leading newspaper having general circulation in Luxembourg (which is expected
to be d’Wort) and (iii) provide representatives of the Luxembourg Stock Exchange with the Remarketing Prospectus as defined in the Remarketing Agreement. 
  
 (b) The Administrator will also include in the Initial Reset Date Notice the names and contact information of the Luxembourg
Listing Agent, if applicable, and any Remarketing Agents confirmed or appointed by the Administrator, or if no Remarketing Agents have then been so chosen, the Administrator will provide adequate contact information for Reset Rate Noteholders to
receive information regarding the upcoming Reset Date. 
  
 (c) If
the related Clearing Agency or its respective nominee, as applicable, is no longer the holder of record of the Reset Rate Notes, the Administrator, or the Remarketing Agents on its behalf, will send the Reset Rate Noteholders, with a copy to the
Indenture Trustee and the Luxembourg Listing Agent, as applicable, the required notices setting forth the information in Sections 3(a) and 3(b) above not less than fifteen nor more than thirty calendar 

  

 Appendix A-2-2 

 
days prior to any Remarketing Terms Determination Date. In addition, in the event that Definitive Notes evidencing an interest in the Reset Rate Notes are
issued, the Administrator shall cause the Note Registrar to provide to the Reset Rate Noteholders and the Luxembourg Listing Agent, as applicable, any additional procedures applicable to the Reset Rate Notes while in definitive form. 
  
 Section 4. Remarketing Terms Determination Date: (a) Subject to the
provisions of the Remarketing Agreement, prior to the Remarketing Terms Determination Date, and unless the holder of the Call Option has delivered the Call Option Notice, the Administrator shall re-affirm the capability of the initial Remarketing
Agents to perform under the Remarketing Agreement, and/or enter into new remarketing agreements with other or additional remarketing agents, who shall function as the Remarketing Agents with respect to the Reset Date. On each Remarketing Terms
Determination Date, the Trust, the Administrator and the Remarketing Agents will enter into a Remarketing Agency Agreement for the remarketing of the Reset Rate Notes. 
  
 (b) If the Remarketing Agents, in consultation with the Administrator, determine prior to the Remarketing Terms
Determination Date that any Currency Swap Agreements required pursuant to Section 2(c)(iii) above will not be obtainable on the related Reset Date, the Reset Rate Notes must be denominated in U.S. Dollars during the next Reset Period. 
  
 (c) Unless the holder of the Call Option has delivered the Call Option
Notice, on or prior to the Remarketing Terms Determination Date the Remarketing Agents will notify the Reset Rate Noteholders whether tender is deemed mandatory or optional and, in consultation with the Administrator, will establish the following
terms for the Reset Rate Notes to be applicable during the immediately following Reset Period: 
  
 (i) the expected weighted average life of the Reset Rate Notes, based on prepayment and other assumptions customary for comparable
securities; 
  
 (ii) the name and contact
information of the Remarketing Agents; 
  
 (iii)
the next Reset Date and length of such Reset Period; 
  
 (iv) the interest rate mode (i.e., fixed rate or floating rate); 
  
 (v) the currency denomination; 
  
 (vi) the applicable minimum denomination and additional increments for the Reset Rate Notes; 
  
 (vii) if in Foreign Exchange Mode, the identities of the Eligible Swap Counterparties from which bids will be solicited; 
  
 (viii) if in Foreign Exchange Mode, the applicable
Distribution Dates on which interest and principal will be paid to the Reset Rate Noteholders, if other than quarterly; 
  
 (ix) whether the class will be structured to amortize periodically or to receive a payment of principal only at the end of the related
Reset Period; 
  

 Appendix A-2-3 

 (x) if in floating rate mode, the applicable Index; 
  
 (xi) if in floating rate mode, the interval between Interest
Rate Change Dates; 
  
 (xii) if in floating rate
mode, the applicable Interest Rate Determination Date; 
  
 (xiii) if in fixed rate mode, the applicable fixed rate pricing benchmark; 
  
 (xiv) if in fixed rate mode, the identities of the Eligible Swap Counterparties from which bids will be solicited; 
  
 (xv) if in floating rate mode, whether there will be a Swap
Agreement and, if so, the identities of the Eligible Swap Counterparties from which bids will be solicited; 
  
 (xvi) the applicable Day Count Basis; 
  
 (xvii) the related All Hold Rate, if applicable; 
  

(xviii) if Definitive Notes are to be issued, the procedures for delivery and exchange of Definitive Notes and for dealing with lost or
mutilated notes; and 
  
 (xix) any other relevant
terms incidental to the foregoing (other than the related Spread or fixed rate of interest, as applicable) for the next Reset Period; 
  
 provided that any interest rate mode, other than a floating rate based on LIBOR or a Commercial Paper Rate, will require that the Rating Agency Condition be
satisfied prior to the delivery of the related Remarketing Terms Notice. 
  
 (d) The Remarketing Agents will communicate all of the information established in Section 4(c) above in the Remarketing Terms Notice required to be given in writing (including facsimile or other electronic
transmission if in accordance with each Clearing Agency’s standard procedures) to each Clearing Agency (and the Luxembourg Stock Exchange if the Reset Rate Notes are then listed on such exchange) or to the Reset Rate Noteholders if Definitive
Notes have been issued, as applicable, the Indenture Trustee and the Rating Agencies on the Remarketing Terms Determination Date. 
  
 (e) In addition, prior to the Remarketing Terms Determination Date, the Administrator shall cause the Schedule Replacement Order with respect to the Reset
Rate Notes to be delivered to the Indenture Trustee, the Clearing Agencies and, if the Reset Rate Notes are then listed on the Luxembourg Stock Exchange, the Luxembourg Listing Agent. Furthermore, the Administrator shall also prepare, on behalf of
the Trust, a preliminary Remarketing Prospectus, dated as of the Remarketing Terms Determination Date, setting forth the relevant terms for the next Reset Period in addition to current information regarding the pool of Trust Student Loans.

  
 Section 5. All Hold Rate: (a) On each Remarketing Terms
Determination Date for the Reset Rate Notes which are denominated in U.S. Dollars during both the then-current Reset Period and the immediately following Reset Period, the Remarketing Agents, in consultation 

  

 Appendix A-2-4 

 
with the Administrator, will establish the All Hold Rate for the Reset Rate Notes. When the Reset Rate Notes are either in Foreign Exchange Mode during the
then-current Reset Period or will be reset into Foreign Exchange Mode on the immediately following Reset Date, all Reset Rate Noteholders will be deemed to have tendered their Notes on the related Reset Date, regardless of any desire by such Reset
Rate Noteholders to retain their ownership thereof, and no All Hold Rate will be applicable. 
  
 (b) The All Hold Rate will only be applicable if 100% of the Reset Rate Noteholders deliver timely Hold Notices wherein they elect to hold their Reset Rate Notes for the next related Reset Period. If applicable, the
related interest rate for the Reset Rate Notes during the immediately following Reset Period will not be less than the All Hold Rate. If the rate of interest using the Spread or fixed rate of interest established on the Spread Determination Date is
higher than the All Hold Rate, then upon a successful remarketing of the Reset Rate Notes, all Reset Rate Noteholders who delivered a Hold Notice agreeing to be subject to the All Hold Rate instead will be entitled to the higher rate of interest
during the immediately following Reset Period. 
  
 Section 6.
Failed Remarketing: (a) With respect to each Reset Date for which the holder of the Call Option does not deliver the Call Option Notice, a Failed Remarketing will be declared by the Remarketing Agents and the provisions of this Section 6 will
apply if any of the conditions set forth in the definition of “Failed Remarketing” are applicable. In order to prevent the declaration of a Failed Remarketing, the Remarketing Agents will have the option, but not the obligation, to
purchase the Reset Rate Notes tendered that they are not otherwise able to remarket or with respect to which a committed purchaser defaults on their purchase obligations. 
  
 (b) At any time a Failed Remarketing is declared: (i) the Reset Rate Notes will be retained by the Reset Rate Noteholders on
the related Reset Date, regardless of any deemed mandatory or voluntary tenders made to the Remarketing Agents, (ii) the Failed Remarketing Rate for the Reset Rate Notes will apply for the related Reset Period and (iii) a Reset Period of three
months will be established. In addition, if the Reset Rate Notes are in Foreign Exchange Mode at the time a Failed Remarketing is declared, the provisions of Sections 10(a)(i) and (ii) shall also apply. 
  
 (c) If there is a Failed Remarketing of the Reset Rate Notes, the Reset Rate
Noteholders shall not be entitled to exercise any remedies as a result of the failure of their Reset Rate Notes to be remarketed on the related Reset Date. 
  
 Section 7. Call Option: (a) With respect to each Reset Date, the Depositor, as the initial holder of the Excess Distribution Certificate, is hereby
granted the Call Option for the purchase of not less than 100% of the Reset Rate Notes, exercisable at a price equal to 100% of the Outstanding Amount of the Reset Rate Notes, less all amounts distributed to the Reset Rate Noteholders as a payment
of principal with respect to the related Distribution Date(s), plus any accrued and unpaid interest not paid by the Trust with respect to the applicable Reset Date. 
  
 (b) The Depositor, as the initial holder of the Excess Distribution Certificate, effective as of the Closing Date, hereby
transfers all of its right, title and interest in and to the Call Option to SLM Education Credit Finance Corporation and then SLM Education Credit 

  

 Appendix A-2-5 

 
Finance Corporation shall transfer all of its right, title and interest therein to SLM Investment Corporation, which upon receipt thereof will dividend all
of its right, title and interest in and to the Call Option to SLM Corporation, and in acceptance of such transfer SLM Corporation also hereby agrees to abide by all terms and conditions hereunder with respect to the Call Option as set forth in these
Reset Rate Note Procedures. 
  
 (c) SLM Corporation may further
transfer ownership of the Call Option at any time to one of its Affiliates; provided that such permitted transferee has at no time in the past owned, and is not obligated under either the Purchase Agreements or the Sale Agreement to transfer,
an interest in any of the Trust Student Loans. 
  
 (d) The Call
Option may be exercised with respect to the Reset Rate Notes at any time on or prior to the determination of the related Spread or fixed rate or the declaration of a Failed Remarketing, as applicable, on the related Spread Determination Date by
delivery of a Call Option Notice; provided that the Call Option may not be exercised before the day following the last Distribution Date immediately preceding the next applicable Reset Date. In addition, for so long as the Reset Rate Notes
are listed on the Luxembourg Stock Exchange, the holder of the Call Option shall cause a notice of the exercise of the Call Option to be published in a leading newspaper having general circulation in Luxembourg (which is expected to be
d’Wort). Once written notice of the exercise of the Call Option is given, such exercise may not be rescinded. 
  
 (e) All amounts due and owing to the Reset Rate Noteholders shall be remitted on or before the related Reset Date by the holder of the Call Option in
accordance with the standard procedures established by the Clearing Agencies for transfer of securities to ensure timely payment of principal to the Reset Rate Noteholders on the related Reset Date. 
  
 (f) In the event that the Call Option is exercised with respect to the Reset
Rate Notes when they are in Foreign Exchange Mode, the holder of the Call Option shall deliver the U.S. Dollar Equivalent Principal Amount remaining after all payments of principal are made with respect to the related Distribution Date, and interest
(if applicable) owing to the Reset Rate Noteholders to the Remarketing Agents for delivery to the Swap Counterparties to the related Currency Swap Agreements, who shall exchange such amount into the applicable currency for delivery to the Reset Rate
Noteholders; provided, however, that if there is no such Currency Swap Agreement then in effect, the holder of the Call Option shall remit all amounts due and owing to the Remarketing Agents for delivery to the Reset Rate Noteholders
in the applicable currency on or before the Reset Date in accordance with the standard procedures established by the related Clearing Agencies for transfer of securities to ensure timely payment of principal to the Reset Rate Noteholders on the
related Reset Date. 
  
 (g) If the Call Option is exercised with
respect to the Reset Rate Notes, (i) the interest rate on the Reset Rate Notes will be the Call Rate, (ii) the Reset Rate Notes will be denominated in U.S. Dollars and (iii) a Reset Period of three months will be established. At the end of such
three month Reset Period, the holder of the Call Option may either remarket the Reset Rate Notes pursuant to the remarketing procedures set forth herein and in the Remarketing Agreement, or retain the Reset Rate Notes for one or more successive
three-month Reset Periods at the then-current Call Rate. In the event the holder of the Call Option chooses to remarket the Reset Rate Notes, such holder shall be solely responsible for all costs and expenses relating to 

  

 Appendix A-2-6 

 
the preparation of any new offering document and any other related costs and expenses associated with such remarketing, other than the fees of the
Remarketing Agents, as more fully set forth in Section 3 of the Remarketing Agreement. 
  
 (h) Other than in connection with the exercise of the Call Option, neither SLM Corporation, SLM ECFC, VG Funding, the Trust or any of their Affiliates shall have the ability to purchase any Reset Rate Notes tendered
to the Remarketing Agents. 
  
 Section 8. Hold Notice: For
the Reset Rate Notes when they are denominated in U.S. Dollars during both the then-current Reset Period and the immediately following Reset Period, the Reset Rate Noteholders will have the option to deliver a Hold Notice to any Remarketing Agent
setting forth their desire to hold their Reset Rate Notes for the next Reset Period at a rate of interest not less than the All Hold Rate and on the terms set forth in the related Remarketing Terms Notice, at any time on or after the Remarketing
Terms Determination Date until the Notice Date. Such Hold Notice may be delivered as an oral statement to a Remarketing Agent, if subsequently confirmed in writing within 24 hours, which confirmation may be in the form of an e-mail if timely
received by the Remarketing Agent. If a Reset Rate Noteholder does not timely deliver a Hold Notice to a Remarketing Agent (such Hold Notice not to be considered delivered until actually received by such Remarketing Agent), that Reset Rate
Noteholder will be deemed to have tendered for remarketing 100% of the Outstanding Amount of its Reset Rate Notes. Any duly delivered Hold Notice will be irrevocable, but will be subject to a mandatory tender of the Reset Rate Notes pursuant to any
exercise of the Call Option. All of the Reset Rate Notes, whether tendered or not, will bear interest during any related Reset Period on the same terms. 
  
 Section 9. Spread Determination Date: (a) On each Spread Determination Date, unless a Failed Remarketing has been declared or the holder of the
Call Option has delivered the Call Option Notice, the Administrator, the Trust and the Remarketing Agents will enter into a Supplemental Remarketing Agency Agreement. 
  
 (b) If pursuant to the Remarketing Terms Notice, the Remarketing Agents, in consultation with the Administrator, have
determined that the Reset Rate Notes are to be reset to bear a fixed rate of interest, then the applicable fixed rate of interest for the corresponding Reset Period will be determined on the Spread Determination Date by adding (i) the applicable
spread as determined by the Remarketing Agents on the Spread Determination Date and (ii) the yield to maturity on the Spread Determination Date of the applicable fixed rate pricing benchmark, selected by the Remarketing Agents, as having an expected
weighted average life based on a scheduled maturity at the next Reset Date, which would be used in accordance with customary financial practice in pricing new issues of asset-backed securities of comparable average life; provided that such
fixed rate of interest will in no event be lower than the related All Hold Rate, if applicable. The Remarketing Agents shall determine the applicable fixed rate of interest for the Reset Rate Notes (by reference to the applicable fixed rate pricing
benchmark plus or minus the spread determined on the Remarketing Terms Determination Date) on each Spread Determination Date irrespective of whether no remarketing will occur as the result of the application of the All Hold Rate, if applicable. In
addition, on the related Spread Determination Date, the Remarketing Agents, in consultation with the Administrator, shall determine the Supplemental Interest Account Deposit Amount, if any, for the Reset Rate Notes. 
  

 Appendix A-2-7 

 (c) If pursuant to the Remarketing Terms Notice, the Remarketing Agents, in consultation with the
Administrator, have determined that the Reset Rate Notes are to be reset to bear a floating rate of interest, then, on the related Spread Determination Date, the Remarketing Agents will establish the applicable Spread to be added or subtracted from
the applicable Index; provided that such floating rate of interest will in no event be lower than the related All Hold Rate, if applicable. In addition, on the related Spread Determination Date, the Remarketing Agents, in consultation with
the Administrator, shall determine the Supplemental Interest Account Deposit Amount, if any, for the Reset Rate Notes. 
  
 (d) If required pursuant to Section 2(c) above, on the related Reset Date the Trust shall enter into either (i) one or more Currency Swap Agreements, if
the Reset Rate Notes are to be reset in Foreign Exchange Mode, or (ii) one or more Interest Rate Swap Agreements if the Reset Rate Notes are to be reset in U.S. Dollars and to bear interest at a fixed rate or at a floating rate other than one based
on LIBOR or a Commercial Paper Rate, with an Eligible Swap Counterparty. 
  
 (e) On or immediately following the Spread Determination Date, the Remarketing Agents will communicate in writing (including facsimile or other electronic transmission if in accordance with each Clearing Agency’s
standard procedures) the contents of the Spread Determination Notice to each Clearing Agency (and the Luxembourg Stock Exchange if the Reset Rate Notes are then listed on such exchange) or the Reset Rate Noteholders if Definitive Notes have been
issued, as applicable, with instructions to distribute such notices to its related participants, or to the Reset Rate Noteholders, as applicable, the Indenture Trustee and the Rating Agencies. The Spread Determination Date Notice will contain: (i)
the determined Spread or fixed rate of interest, as the case may be, or, if applicable, a statement that the All Hold Rate or the Failed Remarketing Rate will be in effect for the immediately following Reset Period, (ii) any applicable currency
exchange rate, (iii) the identity of any selected Swap Counterparty or Counterparties, if applicable, (iv) if applicable, the floating rate (or rates) of interest to be due to each selected Swap Counterparty with respect to each Distribution Date
during the immediately following Reset Period and (v) any other information that the Administrator or the Remarketing Agents deem applicable. Furthermore, for the Reset Rate Notes when they are to be reset in Foreign Exchange Mode, the currency
exchange rate, the Extension Rate due to each related Currency Swap Counterparty and the Failed Remarketing Rate for the immediately following Reset Period will be determined pursuant to the terms of the related Currency Swap Agreement and contained
in the Spread Determination Notice. In addition, if required for the immediately following Reset Period, on or before the related Spread Determination Date the Administrator will arrange for new or additional securities identification codes to be
obtained as required. Furthermore, the Administrator, on behalf of the Trust, will prepare the final Remarketing Prospectus, dated the Spread Determination Date, setting forth the terms of the Reset Rate Notes for the upcoming Reset Period.

  
 Section 10. Swap Agreements: 
  
 (a) If the Reset Rate Notes are to be reset in Foreign Exchange Mode, on the
related Reset Date, the Administrator will enter into (not in its individual capacity, but solely as Administrator on behalf of the Trust) or will instruct the Eligible Lender Trustee to enter into (not in its individual capacity, but solely as
Eligible Lender Trustee) one or more Currency Swap Agreements for the related Reset Period. 
  

 Appendix A-2-8 

 (i) Each Currency Swap Counterparty which is party to a related Currency Swap Agreement
will be entitled to receive: (A) on the effective date of such Currency Swap Agreement, all secondary market trade proceeds received from purchasers of the Reset Rate Notes in the applicable currency, (B) with respect to each applicable Distribution
Date, (x) an interest rate of Three-Month LIBOR, plus or minus a spread, as determined from the bidding process described in Section 10(d) below (other than as may be interpolated for an initial or final calculation period under that Currency Swap
Agreement), multiplied by the U.S. Dollar Equivalent Principal Amount of the Reset Rate Notes, and multiplied by a fraction determined by the number of days in the applicable Accrual Period and the applicable Day Count Basis and (y) all payments of
principal in U.S. Dollars that are allocated to the Reset Rate Notes; provided that if the Reset Rate Notes are then structured not to receive a payment of principal until the end of the related Reset Period, all principal payments allocated
to the Reset Rate Notes on any Distribution Date will be deposited into the Accumulation Account and paid to the related Swap Counterparties on or about the next Reset Date as set forth in the related Currency Swap Agreements (including all sums
required to be deposited therein on the Reset Date), but excluding all Investment Earnings thereon, and (C) on a Reset Date corresponding to a successful remarketing or an exercise of the Call Option, all U.S. Dollar currency equivalent of all
secondary market trade proceeds or proceeds from the exercise of the Call Option, as applicable, received from the Remarketing Agents directly from purchasers of the Reset Rate Notes (if in U.S. Dollars), from the new Currency Swap Counterparty or
Counterparties, as applicable (if in non-U.S. Dollar currency) or from the holder of the Call Option, as applicable. 
  
 (ii) In addition, each related Currency Swap Counterparty will be obligated to pay to the Trust (for payment to the Reset Rate
Noteholders, if applicable): (A) on the effective date of such Currency Swap Agreement, the U.S. Dollar equivalent of all secondary market trade proceeds received from purchasers of the Reset Rate Notes, (B) with respect to each applicable
Distribution Date, (x) their applicable percentage of the applicable rate of interest on the Reset Rate Notes multiplied by the U.S. Dollar Equivalent Principal Amount of the Reset Rate Notes and multiplied by a fraction determined by the number of
days in the applicable Accrual Period and the applicable Day Count Basis, and (y) the applicable non-U.S. Dollar currency equivalent of the U.S. Dollars such Swap Counterparty concurrently receives from the Trust as a payment of principal allocated
to the Reset Rate Noteholders (including, on the related Maturity Date for the Reset Rate Notes, if a Currency Swap Agreement is then in effect, the remaining Outstanding Amount of the Reset Rate Notes) but only to the extent that the required U.S.
Dollar Equivalent Principal Amount is received from the Trust on such date, at an exchange rate to be set on the effective date of and set forth in the related Currency Swap Agreement, (C) on the second Business Day following a Distribution Date
that is also a Reset Date (other than for any Reset Period following a Reset Date upon which a Failed Remarketing has occurred, up to and including the Reset Date resulting in a successful remarketing or an exercise of the Call Option) their
applicable percentage of interest at the interest rate from and including the related Reset Date to, but excluding, the second 

  

 Appendix A-2-9 

 
Business Day following such Reset Date, and (D) on the Reset Date corresponding to a successful remarketing or an exercise of the Call Option, the applicable
currency equivalent of all U.S. Dollar secondary market trade proceeds received by the Trust from the purchasers of the Reset Rate Notes or proceeds received by the Trust from the exercise of the Call Option, as applicable, at an exchange rate to be
set on the effective date of and set forth in the related Currency Swap Agreement. For any Reset Period following a Reset Date upon which a Failed Remarketing has occurred, up to any including the Reset Date resulting in a successful remarketing or
an exercise of the Call Option for the Reset Rate Notes, payments of interest and principal to the Reset Rate Noteholders will be made on the second Business Day following the related Reset Date without the payment of any additional interest.

  
 (b) [Reserved.] 
  
 (c) On each Reset Date if the Reset Rate Notes are to be reset in U.S.
Dollars, and a Swap Agreement is required pursuant to Sections 2(c) and 9(d) above, then the Administrator will enter into (not in its individual capacity, but solely as Administrator on behalf of the Trust) or will instruct the Eligible Lender
Trustee to enter into (not in its individual capacity, but solely as Eligible Lender Trustee), one or more Interest Rate Swap Agreements for the next Reset Period to facilitate the Trust’s ability to pay applicable interest at the related
interest rate. 
  
 (i) Each Swap Counterparty
which is party to a related Interest Rate Swap Agreement will be entitled to receive on each Distribution Date an interest rate of Three-Month LIBOR, plus or minus a spread, as determined from the bidding process described in Section 10(d) below,
multiplied by the Outstanding Amount of the Reset Rate Notes and multiplied by a fraction determined by the number of days in the applicable Accrual Period and the applicable Day Count Basis. 
  
 (ii) In addition, each related Swap Counterparty which is a
party to a related Interest Rate Swap Agreement will be obligated to pay to the Trust on each Distribution Date, the applicable rate of interest on the Reset Rate Notes multiplied by the Outstanding Amount of the Reset Rate Notes and multiplied by a
fraction determined by the number of days in the applicable Accrual Period and the applicable Day Count Basis. 
  
 (d) The Remarketing Agents, in consultation with the Administrator, in determining the Swap Counterparty to each required Swap Agreement, will solicit
bids from at least three Eligible Swap Counterparties and will select the lowest of these bids to provide the interest rate swap and/or currency exchange swap(s). If the lowest bidder specifies a notional amount that is less than the Outstanding
Amount of the Reset Rate Notes, the Remarketing Agents, in consultation with the Administrator, may select more than one Eligible Swap Counterparty, but only to the extent that such additional Eligible Swap Counterparties have provided the next
lowest received bid or bids, and enter into more than one Swap Agreement that result in the Rating Agency Condition being satisfied. 
  
 (e) It is a condition precedent to the entering into of any Swap Agreement and the setting of the amount to be paid to the related Swap Counterparty that
the Rating Agency Condition is satisfied. No Swap Agreement will be entered into or caused to be entered into by the Trust, the Administrator on its behalf or the Remarketing Agents, for any Reset Period where either the Call Option has been
exercised or a Failed Remarketing has been declared. 
  

 Appendix A-2-10 

 (f) Each Currency Swap Agreement will terminate at the earliest to occur of (i) the next succeeding Reset
Date for which there is a successful remarketing, (ii) the Reset Date for which the Call Option is exercised, (iii) the Distribution Date on which the Outstanding Amount of the Reset Rate Notes is reduced to zero (including as the result of the
optional purchase of the remaining Trust Student Loans by the Servicer or an auction of the Trust Student Loans by the Indenture Trustee) or (iv) the Maturity Date of the Reset Rate Notes. No Currency Swap Agreement will terminate solely due to the
declaration of a Failed Remarketing. Each Interest Rate Swap Agreement will terminate on the earliest to occur of the next Reset Date, or the occurrence of an event specified in clause (iii) or (iv) above. 
  
 (g) With respect to each Currency Swap Agreement, and in the event that a
Failed Remarketing is declared, the rate of interest due to each related Currency Swap Counterparty from the Trust on each Distribution Date will be increased to the Extension Rate and the rate due to the Trust from each related Currency Swap
Counterparty will change to equal the Failed Remarketing Rate. 
  
 Section 11. Accumulation Accounts; Supplemental Interest Accounts: (a) If, on any Distribution Date, principal would be payable to the Reset Rate Notes when they are then structured not to receive a payment of principal until the end
of the related Reset Period, that principal (subject to sufficient Available Funds therefor) will be allocated to the Reset Rate Notes and deposited into the Accumulation Account, where it will remain until the next Reset Date (except that if the
Reset Rate Notes are in Foreign Exchange Mode, principal will be paid according to the provisions of Sections 10(a)(i) and (a)(ii) above), unless an Event of Default under the Indenture or a sale of the Trust Estate pursuant to Section 6.1 of the
Administration Agreement has occurred (in which case the Indenture Trustee will distribute all sums on deposit therein (exclusive of Investment Earnings) to the Reset Rate Noteholders in accordance with the provisions of Section 5.4(b) of the
Indenture or Section 6.1 of the Administration Agreement, as applicable). 
  
 (b) On each Reset Date, when the Reset Rate Notes were structured during the preceding Reset Period not to receive a payment of principal until the end of the related Reset Period, all sums, if any, then on deposit in
the Accumulation Account, including any allocation of principal made on the same date, but less any Investment Earnings, will be distributed by the Indenture Trustee, at the direction of the Administrator, as set forth in Section 2.8 of the
Administration Agreement, (x) to the holders of the Reset Rate Notes, as of the related Record Date, or (y) if the Reset Rate Notes are then in Foreign Exchange Mode (including during the related initial Reset Period), to the related Currency Swap
Counterparty or Counterparties for the benefit of the Reset Rate Noteholders as of the Record Date pursuant to the provisions of Section 10(a)(i) and (a)(ii) above, in reduction of principal of the Reset Rate Notes; provided that in the event
on any Distribution Date the amount on deposit in the Accumulation Account (excluding any Investment Earnings) would equal the Outstanding Amount of the Reset Rate Notes, no additional amounts will be deposited into the Accumulation Account and all
amounts therein, less any Investment Earnings, will be distributed by the Indenture Trustee, at the direction of the Administrator, as set forth in Section 2.8 of the Administration Agreement, on the next related 

  

 Appendix A-2-11 

 
Reset Date to the Reset Rate Noteholders or the related Currency Swap Counterparty or Counterparties (as applicable), and on such Reset Date the Reset Rate
Notes will no longer be Outstanding. Amounts on deposit in the Accumulation Account (exclusive of Investment Earnings) may be used only to pay principal on the Reset Rate Notes (or to the related Currency Swap Counterparty or Counterparties) and for
no other purpose. On each Distribution Date, all Investment Earnings on deposit in the Accumulation Account will be withdrawn by the Indenture Trustee, at the direction of the Administrator and deposited into the Collection Account. 
  
 (c) The Indenture Trustee, subject to sufficient available funds therefor, at
the direction of the Administrator and pursuant to Section 2.10(d)(ii) of the Administration Agreement, will deposit into a Supplemental Interest Account, the related Supplemental Interest Account Deposit Amount. On each Distribution Date, all sums
(which shall include Investment Earnings) on deposit in each Supplemental Interest Account will be withdrawn by the Indenture Trustee, at the direction of the Administrator, as set forth in Section 2.10(d)(iii) of the Administration Agreement, and
deposited into the Collection Account. 
  
 Section 12.
Remarketing Agents; Remarketing Fee Account: (a) The initial Remarketing Agents, appointed pursuant to the terms of the Remarketing Agreement, are, initially, each of Citigroup Global Markets Inc. and Goldman, Sachs & Co. The
Administrator, in its sole discretion, may change any Remarketing Agent for the Reset Rate Notes for any Reset Period at any time on or before a Remarketing Terms Determination Date. The terms and conditions of the Remarketing Agreement will govern
the duties and obligations of the Remarketing Agents. The Administrator, the Trust and the Remarketing Agents will enter into on each (A) related Remarketing Terms Determination Date and a related Remarketing Agency Agreement, in form and substance
substantially the same as Appendix B to the Remarketing Agreement, unless (i) a Failed Remarketing is declared, or (ii) the holder of the Call Option has delivered the Call Option Notice on or prior to such date; and (B) related Spread Determination
Date, a Supplemental Remarketing Agency Agreement, in form and substance substantially the same as Appendix C to the Remarketing Agreement, unless (i) a Failed Remarketing is declared, (ii) the holder of the Call Option has delivered the Call Option
Notice on or prior to such date, or (iii) if applicable, 100% of the Reset Rate Noteholders have timely delivered a Hold Notice and the All Hold Rate will apply for the next related Reset Period. 
  
 (b) [Reserved.] 
  
 (c) Excluding when a Remarketing Agent has received a timely delivered Hold Notice for the Reset Rate Notes, if applicable
(or if the holder of the Call Option has delivered the Call Option Notice), on the Reset Date that commences each Reset Period, the Reset Rate Notes will be automatically tendered, or deemed tendered, to the relevant Remarketing Agent for
remarketing by such Remarketing Agent on the Reset Date at 100% of its Outstanding Amount. If the Reset Rate Notes are held in book-entry form, 100% of the Outstanding Amount will be paid by the Remarketing Agents in accordance with the standard
procedures of the applicable Clearing Agencies. 
  
 (d) The
Remarketing Agents will attempt, on a reasonable efforts basis and in accordance with the terms and conditions of the Remarketing Agreement and the related Remarketing Agency Agreement, to remarket the tendered Reset Rate Notes of the applicable
class at a price equal to 100% of the Outstanding Amount of the Reset Rate Notes so tendered. 
  

 Appendix A-2-12 

 (e) Purchasers of the Reset Rate Notes will be credited with their positions on the applicable Reset Date
with respect to positions held through DTC or on the next Business Day with respect to positions held through the European Clearing Systems. No payment delay to existing Reset Rate Noteholders holding U.S. Dollar-denominated Reset Rate Notes through
DTC will occur on the related Reset Date when the Reset Rate Notes are denominated in U.S. Dollars during the immediately following Reset Period. 
  
 (f) Each of the Remarketing Agents, in its individual or any other capacity, may buy, sell, hold and deal in the Reset Rate Notes, including, but not
limited to, purchasing any tendered Reset Rate Notes as part of the remarketing process. Any Remarketing Agent that owns a Reset Rate Note may exercise any vote or join in any action which any beneficial owner of the Reset Rate Notes may be entitled
to exercise or take with like effect as if it did not act in any capacity under the Remarketing Agreement or Remarketing Agency Agreement. Any Remarketing Agent, in its individual capacity, either as principal or agent, may also engage in or have an
interest in any financial or other transaction with the Trust, the Depositor, the Servicer, the Indenture Trustee (in its individual capacity), the Eligible Lender Trustee (in its individual capacity) or the Administrator as freely as if it did not
act in any capacity under the Remarketing Agreement or any Remarketing Agency Agreement. No Reset Rate Noteholder or beneficial owner of the Reset Rate Notes will have any rights or claims against any Remarketing Agent as a result of such
Remarketing Agent’s not purchasing any tendered Reset Rate Notes, which results in the declaration of a Failed Remarketing. 
  
 (g) Each of the Remarketing Agents will be entitled to receive a fee in connection with their services rendered for each successful remarketing of the
Reset Rate Notes in the amount set forth in the Remarketing Agreement and the related Remarketing Agency Agreement. Subject to the terms and conditions set forth in the Remarketing Agreement, the Administrator, in its sole discretion, may change the
Remarketing Agents for the Reset Rate Notes for any Reset Period at any time on or before the related Remarketing Terms Determination Date. In addition, the Administrator will appoint one or more additional Remarketing Agents, if necessary, for a
Reset Date when the Reset Rate Notes will be remarketed in a non-U.S. Dollar currency. Furthermore, a Remarketing Agent may resign at any time; provided that no resignation may become effective on a date that is later than 15 Business Days
prior to a Remarketing Terms Determination Date. 
  
 (h) In
accordance with Section 2.3(i) of the Administration Agreement, on the Closing Date, the Trust will establish the Remarketing Fee Account as an asset of the Trust in the name of the Indenture Trustee, for the benefit of the Remarketing Agents and
the Reset Rate Noteholders. The fees associated with each successful remarketing will be payable directly to the Remarketing Agents from amounts on deposit from time to time in the Remarketing Fee Account. On each applicable Distribution Date,
Available Funds will be deposited into the Remarketing Fee Account, in the priority set forth in Section 2.8(c) of the Administration Agreement, in an amount up to the Quarterly Funding Amount; provided that if the amount on deposit in the
Remarketing Fee Account, after the payment of any remarketing fees therefrom, exceeds the sum of the Reset Period Target Amount for the Reset Rate Notes, such excess will 

  

 Appendix A-2-13 

 
be withdrawn on the related Distribution Date, deposited into the Collection Account and included in Available Funds for that Distribution Date. All
Investment Earnings on deposit in the Remarketing Fee Account will be withdrawn on the next Distribution Date, deposited into the Collection Account and included in Available Funds for that Distribution Date. In the event that the fees owed to any
Remarketing Agent on a Reset Date exceeds the amount then on deposit in the Remarketing Fee Account, such shortfall shall be paid from Available Funds on future Distribution Dates in the priority set forth in Section 2.8(n) of the Administration
Agreement. The Trust shall also be responsible for certain remarketing costs and expenses to the extent set forth in Section 3 of the Remarketing Agreement, which shall be paid on each Distribution Date, to the extent of Available Funds, at the
priority set forth in Section 2.8(o) of the Administration Agreement. 
  
 Section 13. Eligible Lender Trustee: The Eligible Lender Trustee is hereby authorized and directed to execute and deliver, not in its individual capacity, but solely as Eligible Lender Trustee on behalf of the Trust, the Remarketing
Agreement, any Swap Agreements and any required supplement, amendment or replacement thereof, and all Remarketing Agency Agreements and Supplemental Remarketing Agency Agreements as the Administrator, in writing and from time to time, shall instruct
the Eligible Lender Trustee to execute. The Eligible Lender Trustee shall not be liable to any party, any third party or any Noteholder for any such actions taken at the written instruction of the Administrator. Notwithstanding the foregoing, in the
event that the Eligible Lender Trustee declines or fails to execute or deliver any such document, instrument, certificate or agreement as instructed by the Administrator, the Administrator is hereby authorized, in its sole discretion, to execute and
deliver, not in its individual capacity but solely as Administrator on behalf of the Trust, all such required documents, instruments, certificates and agreements. The foregoing authorization shall represent a limited power of attorney granted by the
Trust to the Administrator to act on its behalf, and the Administrator shall not be liable to any party, any third party or any Noteholder for any such actions taken in good faith and in accordance with these Reset Rate Note Procedures. 

 

 Appendix A-2-14 

 SCHEDULE A 
  

Schedule of Trust Student Loans 
  
 [See Schedule A to the Bill of Sale 
  
 (Attachment C to the Sale Agreement)] 
  

 Schedule A-1 

 SCHEDULE B 
  

Location of Trust Student Loan Files 
  
 [See Attachment B to the Servicing Agreement] 
  

 Schedule B-1 

 EXHIBIT A 
  

Forms of Notes 
  
 (See tabs 15.1 through 16.1) 
  

 Exhibit A-1 

 EXHIBIT B 
  

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

 Exhibit B-1 

 EXHIBIT C 
  

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

 Exhibit C-1Loan Agreement by and between  Central Pacific Bank and Registrant

 Exhibit 10.26 
  
 LOAN AGREEMENT 
  
 THIS AGREEMENT, is made on June 9, 2005, by and between CENTRAL PACIFIC BANK, a Hawaii corporation, whose mailing address is P. O. Box 3590, Honolulu,
Hawaii 96811-3590 (the Lender), and HOKU SCIENTIFIC, INC., a Delaware corporation, whose principal place of business and post office address is 2153 North King Street, Suite 300, Honolulu, Hawaii 96819 (the Borrower); 
  
 W I T N E S S E
T H : 
  
 WHEREAS, the Borrower has applied to the
Lender for a loan (the Loan), up to the principal amount of THREE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($3,500,000.00) in order to finance the construction of a production facility on the premises located at 1075 Opakapaka Street,
Kapolei Business Park Lot No. 34, Kapolei, City and County of Honolulu, State of Hawaii (Tax Map Key No. (1) 9-1-075-009) (the Project); 
  
 WHEREAS, the Lender is willing to make a loan to the Borrower on the terms and conditions hereinafter set forth and in full reliance upon the
representations and warranties made by the Borrower in this Agreement; 
  
 NOW, THEREFORE, the Borrower and the Lender, in consideration of the mutual covenants hereinafter set forth and intending to be legally bound, hereby agree as follows: 
  
 Section 1. The Loan. Subject to the terms and conditions of this Agreement, the Lender agrees to lend and the
Borrower agrees to borrow from the Lender the principal sum not to exceed THREE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($3,500,000.00). 
  
 During the first twelve (12) months of the term of the Loan, interest only shall be paid in consecutive monthly installments on the 9th day of each month
commencing on July 9th, 2005. 
  
 During months thirteen through thirty-five of the term of the Loan, the amount of the monthly installments shall equal that
amount sufficient to amortize the unpaid balance of the Note, together with interest at the applicable rate, computed as and when provided below, in equal monthly installments determined as if the term of this Loan was eighteen (18) years, it being
understood that the term of this Loan is three (3) years. All payments being due on the 9th day of each month until
the Note has been paid in full. 
  
 Interest shall be calculated
daily on the basis of the actual number of days elapsed over a 365-day year or 366-day year, as the actual case may be. 
  
 All payments shall be applied first to any charges payable by the Borrower, then to accrued interest and then to the principal balance. 
  

 During the term of the Note, if there shall be no default hereunder, the interest rate shall be a fixed
rate of 5.30% per annum on the outstanding principal balance. 
  
 In the event Borrower refinances this Loan with another financial institution, Borrower shall pay a TWO PERCENT (2%) prepayment penalty on the amounts prepaid. Otherwise, Borrower may prepay the principal amount outstanding in whole or in
part, without penalty, provided, however, Borrower shall give Lender at least thirty (30) days prior written notice of any material prepayment. Any partial prepayment shall be applied against the principal amount outstanding and shall not postpone
the due date of any subsequent monthly installments or change the amount of such installments, unless the Lender shall otherwise agree in writing. 
  
 Lender hereby waives the loan fee for this Loan or any refinance of this Loan. In the event Borrower requests additional funds at the time of the
refinancing of this Loan, a loan fee shall be charged based on the additional funds. 
  
 The maturity date for the Note shall be on June 9, 2008, at which time the entire outstanding balance, plus all accrued but unpaid interest shall be due and payable in full. 
  
 The obligation of the Borrower to repay the Loan, together with accrued
interest thereon, shall be evidenced by a promissory note (the Note), in form and substance satisfactory to the Lender, duly executed and delivered by the Borrower to the Lender. 
  
 To secure the due and punctual payment of the Note, and the performance of any and all obligations of the Borrower under the
Loan Documents (as hereinafter defined), the Borrower will deliver or cause to be delivered to the Lender on or before the Closing Date: 
  
 (a) A Mortgage, Security Agreement and Financing Statement (the Mortgage), in form and content satisfactory to the Lender, dated concurrently with the
Note, duly executed and acknowledged by Borrower, as Mortgagor, constituting at all times a valid and subsisting first lien upon the fee simple property located at 1075 Opakapaka Street, Kapolei Business Park Lot No. 34, Kapolei, City and County of
Honolulu, State of Hawaii, Tax Map Key No. (1) 9-1-075-009 (the Property), and on all structures and improvements constructed and located thereon (the Improvements) and a valid and subsisting security interest in any and all other personal property
now owned or hereafter acquired by the Mortgagor, and incorporated in the improvements or otherwise situated upon the Property. 
  
 (b) An Assignment of Lessor’s Interest in Leases and Rents (the Assignment), in form and content satisfactory to the Lender, dated concurrently with
the Note, duly executed and acknowledged by Borrower, unconditionally and absolutely assigning to the Lender all of the Borrower’s right, title and interest in and to any leases, rents and income arising out of the Property. 
  

 2 

 (c) A Security Agreement (the Security Agreement), in form and content satisfactory to the Lender, duly
executed and acknowledged by Borrower, constituting at all times a valid and subsisting lien on all of the assets and personal property of Borrower now owned or hereafter acquired (the Collateral). 
  
 (d) A Financing Statement (the Financing Statement), in form and content
satisfactory to the Lender, perfecting the Lender’s security interest in and to the Collateral. 
  
 (e) A Hazardous Substances Certificate and Indemnity Agreement (the Indemnity Agreement), in form and content satisfactory to the Lender, duly executed by
the Borrower. 
  
 This Agreement, the Note, the Mortgage, the
Assignment, the Security Agreement, the Financing Statement, the Indemnity Agreement and all other documents contemplated by or necessary to effect the purposes of this Agreement are herein sometimes collectively called the Loan Documents.

  
 The execution of the principal Loan Documents shall take place
at the office of the Lender, at such time or times as shall be mutually agreed upon by the Lender and the Borrower. The date of filing and recordation of the Mortgage and the Assignment is herein referred to as the “Closing Date”.

  
 Section 2. Representations and Warranties by the
Borrower. The Borrower represents and warrants to the Lender that: 
  
 2.1 Organization, Standing and Authority of Borrower. The Borrower is a corporation duly registered, validly existing and in good standing under the laws of the State of Delaware. The Borrower shall provide the Lender with (i)
resolutions and/or other documentation duly authorizing the execution and delivery of the documents required to be executed by such corporation; (ii) copies of its articles of incorporation certified by the State of Delaware; (iii) a certificate of
good standing certified by the State of Delaware; and (iv) its By-Laws. The corporation has all requisite power and authority to carry on the business and to own the property that it now carries on and owns. The Borrower has all requisite power and
authority to execute and deliver the Loan Documents and to observe and perform all of the provisions and conditions thereof. No other corporate action of the Borrower is required to the execution and delivery of the Loan Documents. 
  
 2.2 Title to the Property. The Borrower now has or will have good,
marketable title to the Property on the Closing Date, free and clear of all defects, liens and encumbrances, excepting only liens for taxes, assessments of governmental charges or levies not yet delinquent or payable without penalty or interest, and
such liens and encumbrances as may be approved by the Lender. 
  
 2.3 Tax Returns and Payments. All tax returns and reports of the Borrower required by law to be filed have been duly filed and all taxes, assessments, contributions, fees and other governmental charges (other than those presently
payable without penalty or interest and those which have been disclosed to the Lender, but which are currently being contested in good faith) upon the Borrower or upon its properties or assets or income which are due and payable, have been paid.

  

 3 

 2.4 Litigation. There is no action, suit, proceeding or investigation pending at law or in equity
or before any federal, state, territorial, municipal or other governmental department, commission, board, bureau, agency or instrumentality or, to the knowledge of the Borrower, threatened against or affecting the Borrower or the Property which
might materially affect the Borrower’s ability to perform its obligations under the Loan Documents. 
  
 2.5 Financial Statements. All financial statements heretofore delivered to the Lender by the Borrower are true and correct in all material
respects, have been prepared in accordance with generally accepted accounting principles consistently applied, and fairly represent the financial condition of the Borrower as of the dates thereof, subject to year end adjustments; no material,
adverse changes have occurred in the financial condition reflected therein since the respective dates thereof; and no additional borrowings have been made by the Borrower other than borrowing approved by the Lender. 
  
 2.6 Utility Services. All utility services necessary for servicing of
the improvements and the operation and use thereof for their intended purposes are available at the boundary of the Property, including, but not limited to, water supply, storm and sanitary sewer facilities, electric and telephone facilities.

  
 2.7 Access. The Property is contiguous to publicly
dedicated streets, roads or highways; and vehicular access from the Property is permitted to all such publicly dedicated streets, roads or highways. 
  
 2.8 Character of Representations and Warranties. None of the financial statements or any certificate or statement furnished to the Lender by or on
behalf of the Borrower in connection with the Loan, and none of the representations and warranties in this Agreement, contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading. To the best of the knowledge of the Borrower, there is no fact which materially adversely affects or in the future (so far as the Borrower can now foresee) may materially adversely affect the ability of
the Borrower to observe or perform its obligations under the Loan Documents which has not been set forth herein or in a certificate or opinion of counsel or other written statement furnished to the Lender by or on behalf of the Borrower. 

 
 2.9 Compliance with Law. The consummation of the transactions
contemplated by the Loan Documents will not conflict with or result in a breach of any law, statute, ordinance, regulation, order, writ, injunction, decree or judgment of any court or governmental instrumentality, domestic or foreign. 
  
 2.10 Governmental Authorizations. With respect to the design and
construction of the Improvements, no consent, approval or authorization of or registration, declaration or filing with any governmental or public body or authority is required (or, if required, such consent, approval, order or authorization shall
have been obtained prior to the Lender making any advance of the Loan proceeds for any expenses other than those in connection with (a) the valid execution and delivery of each of the Loan Documents, (b) any compliance with building, setback,
building moratorium, special design district, historic preservation, or other ecological or environmental requirements, or state land use classification or county 

  

 4 

 
zoning of the Property; or any other federal, state or municipal laws, regulations, codes or rules, or (c) the observance or performance of any of the
transactions required or contemplated hereby or thereby, including, but not limited to, the construction of the Improvements). 
  
 2.11 ADA Compliance. The Lender must be satisfied that the Property is in compliance with the American With Disabilities Act (ADA). Additionally,
the Loan Documents will provide for the Borrower’s indemnification of the Lender against all liabilities or costs which the Lender may incur resulting from the Property’s non-compliance with the ADA including, but not limited to, costs
incurred to bring the property into ADA compliance. 
  
 Section 3.
Conditions of the Lender’s Obligation. The Lender’s obligation to make the Loan hereunder is subject to the fulfillment, to the Lender’s satisfaction prior to or on the Closing Date, of the following conditions: 
  
 3.1 Representations and Warranties True at Closing. The
representations and warranties contained in this Agreement and otherwise made by or on behalf of the Borrower in connection with the Loan shall be true and correct as of the Closing Date. 
  
 3.2 No Event of Default. There shall exist at the Closing Date hereunder no condition or event which would constitute
an Event of Default, as defined herein, or which, after notice or lapse of time or both, would constitute an Event of Default. 
  
 3.3 Performance. The Borrower shall have performed and complied with all agreements and conditions contained herein and required to be performed
and complied with prior to or at the Closing Date. 
  
 3.4
Title Insurance. The Lender shall obtain policies of title insurance on ALTA form (the Title Policy), including such indorsements as the Lender may require, issued by a title insurance company (the Title Insurer) and reinsured by such number
of additional title insurance companies as the Lender may require, in form, substance and amount (which shall not be less than the full principal amount of the Note) satisfactory to the Lender, insuring (or agreeing to insure) that the Mortgage
constitutes a valid first lien on the Property, free and clear of all defects, liens, encumbrances and exceptions to title whatsoever, except such as are shown on Exhibit A attached to the Mortgage and such additional matters as the Lender may
approve. The Title Policy shall effect full coverage against losses arising out of encroachments against boundary or setback lines, against losses from existing mechanics’ or materialmen’s liens and subsequent mechanics’ and
materialmen’s liens which may gain priority over the Mortgage or which may attach to the Property, losses arising out of the violation of zoning ordinances and regulations and such other losses with respect to which the Lender may require
coverage. The Title Policy shall contain no exclusions, stipulations or exceptions not theretofore approved by the Lender. 
  
 3.5 Chattel Lien Report. The Borrower shall have delivered to the Lender a chattel lien report by a substantial, financially responsible corporate
title searcher, in form and substance satisfactory to 

  

 5 

 
the Lender, advising the Lender that a search of the public records discloses, as of the Closing Date, no judgments, pending actions in state or federal
court, security agreements, chattel mortgages, financing statements, title retention agreements, notices or certificates of tax liens or other instruments or documents (except the Mortgage and the Assignment described hereinabove) filed or recorded
against the Borrower or the Property. 
  
 3.6 Insurance.
The Borrower shall provide, or cause to be provided, worker’s compensation insurance and public liability and other insurance, including, but not limited to, fire insurance (in builders’ risk completed value form, one hundred percent
(100%) coverage, including extended coverage), or all risk insurance, and flood, settling, subsidence and difference-in-conditions insurance and such other hazard insurance as may be required by the Lender, all in form and amount satisfactory to the
Lender and bearing such endorsements as shall be deemed necessary by the Lender. The Borrower hereby acknowledges the Lender’s execution of this Agreement as written notice to the Borrower that the Borrower is free to procure all insurance
required hereunder or under any of the other loan documents from any insurance company authorized to do business in the State of Hawaii, subject to the legal right of the Lender to be satisfied as to the insurer’s financial condition. All
losses payable under such fire, flood, settling, subsidence and difference-in-conditions insurance and hazard insurance shall be payable to the Lender, as mortgagee, pursuant to a standard mortgagee clause. The originals or certified copies of all
such policies or certificates of insurance in respect thereof, stamped “paid” in each case, shall be deposited with the Lender. Each insurer shall agree by endorsement upon the policy or policies issued by it, or by independent instruments
furnished to the Lender, that it will give the Lender at least thirty (30) days prior written notice before any such policy or policies shall be altered or cancelled, and that no act or default of the Borrower or any other person shall affect the
right of the Lender to recover under such policy or policies in case of loss or damage. The Lender hereby notifies the Borrower that the Borrower is free to procure such insurance from any insurer or insurers authorized to do business in the State
of Hawaii. 
  
 3.7 Appraisals. The Borrower shall not be
required to furnish the Lender with a formal appraisal report for the Property, provided, however, the Lender shall have the right to obtain at the Borrower’s expense, reappraisals of the Property from any certified appraiser designated by the
Lender, from time to time, whenever such reappraisals may be (a) required by any law, rule or regulation applicable to the conduct of the Lender’s business, or (b) requested or directed by any governmental authority charged with the
administration of such law, rule or regulation or the Lender’s compliance thereof, whether or not such request or direction has the force of law. 
  
 3.8 Current Financial Statements. The Borrower shall have delivered current financial statements satisfactory to the Lender, showing that no
adverse changes have occurred in its financial conditions since the date of the financial statements previously delivered to the Lender. All financial statements shall be provided to the Lender within one hundred twenty (120) days after the close of
each fiscal/calendar year. Further, during the term of the Loan, all financial statements provided to the Lender will be true and correct in all respects, and prepared in accordance with generally accepted accounting principles consistently applied,
which fairly represent the financial condition of the Borrower as of the dates thereof; no material adverse changes will have occurred in the financial condition reflected therein since the respective 

  

 6 

 
dates thereof; and no additional borrowings will have been made by the Borrower other than borrowing approved by the Lender. 
  
 3.9 Evidence of Tax Payments; Tax Clearance Certificate. The Lender
shall have received a Tax Clearance Certificate issued by the Department of Taxation of the State of Hawaii certifying that all taxes due to the State of Hawaii by the Borrower up to and including a date within ten (10) days of the Closing Date have
been paid. 
  
 3.10 Environmental Survey. A Phase I
environmental assessment report, by a professional consultant, acceptable to Lender, indicating that all land that is to be collateral is free of any material amounts of hazardous or toxic substances or materials, within the definition of all
federal, state, or local statutes, ordinances and regulations applicable to the land, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), the Resource Conservation and Recovery Act (RCRA),
and any other environmental requirements all as amended to the Closing Date, or describing whether any environmentally hazardous materials or toxic substances, including, but not limited to asbestos, has been or are placed, located, held,
manufactured or stored on or under the Mortgaged Property, except as provided therein. The Lender reserves the right to decline the Loan if the report and/or subsequent examination reveals the existence or prospect of environmentally hazardous
materials in amounts or of a nature unacceptable to the Lender, in its sole discretion. The Lender hereby notifies the Borrower that the Borrower is free to obtain such environmental assessment report from any company qualified in the State of
Hawaii. 
  
 3.11 Zoning. The Borrower shall have furnished
to the Lender evidence satisfactory to the Lender that the Property is duly and validly classified under the State land use law and zoned under the applicable ordinances of the City and County of Honolulu for the construction of the Improvements.

  
 3.12 Plans and Specifications; Permits. The Borrower
shall have furnished to the Lender and the Lender shall have approved: 
  
 (a) A complete set of the plans and specifications for the Project (the Plans and Specifications) with each sheet initialed by the Borrower and the General Contractor, together with the General Contractor’s
certification that (i) such Plans and Specifications conform to the plans and specifications approved by officers of the City and County of Honolulu charged with the responsibility of issuing grading and building permits and (ii) that such officers
have issued all such permits (the “Permits”) prerequisite to construction of the Improvements for the Project in accordance with such Plans and Specifications; 
  
 (b) Copies of all the Permits and the applications therefor; 
  
 (c) Copies of all other permits or approvals of any
governmental or regulatory authority or agency having jurisdiction requisite for construction and use of any improvement provided for in the Construction Contract for the Improvements; and 
  

 7 

 (d) If requested by the Lender, letters or other appropriate instruments from the City
and County of Honolulu, in form and substance satisfactory to the Lender, evidencing that the Permits are valid and subsisting and that the Borrower is the legal holder thereof. 
  
 3.13 Soils Test Report. If requested by the Lender, the Borrower shall have delivered to the Lender, a soils test
report and foundation recommendations in form and substance satisfactory to the Lender, by a qualified registered engineer approved by the Lender certifying that the Property is satisfactory for any Improvements requiring a building permit.

  
 3.14 Construction Contract. The Borrower shall have
furnished to the Lender and the Lender shall have approved an executed copy of the Construction Contract with MARYL PACIFIC CONSTRUCTION, INC., a Hawaii corporation, for the Improvements, in form and substance satisfactory to the Lender. 

 
 3.15 Lists and Approval of Contractors, Subcontractors and
Materialmen. The Borrower shall have furnished, or caused to be furnished to the Lender, and the Lender shall have approved, correct lists of all contractors employed as of the Closing Date in connection with the construction of the
Improvements. Such list shall show the name, address and telephone number of each such contractor, a general statement of the nature of the work to be done, the labor and materials to be supplied, the names of materialmen, if known, and the
approximate dollar value of such labor, work or materials with respect to each. The Lender has the right to disapprove any contractor who, in the Lender’s good faith determination, is deemed to be financially, or otherwise unqualified. Failure
by the Lender to disapprove a contractor shall not constitute a warranty or representation by the Lender that any contractor or subcontractor not so disapproved is in fact qualified. The Lender shall have the right to telephone or otherwise
communicate with any General Contractor or any other contractor or materialman to verify the facts disclosed by such list or any application for any advance or for any other purpose. 
  
 3.16 Performance and Payment Bonds. The Borrower shall have furnished to the Lender a performance bond and a labor
and material payment bond (hereinafter collectively called the Performance and Payment Bond) each in an amount equal to 100% of the amount of each Construction Contract, with such riders and supplements as the Lender may require, each in form and
substance satisfactory to the Lender, naming the General Contractor as principal, a corporate surety satisfactory to the Lender as surety, and the Lender as an additional or dual obligee. 
  
 3.17 Compliance With Law; Governmental Authorization. All restrictive covenants, land use laws and regulations,
zoning ordinances and regulations, building codes and regulations, environmental and ecological laws and regulations, and any other applicable laws, statutes, ordinances or regulations, shall have been fully complied with, and all licenses, permits
and all certificates required by governmental authorities with respect to the construction of the Improvements shall have been obtained. 
  

 8 

 3.18 Project Costs, Budget and Cash Flow Forecast. The currently projected costs and expenses
shall be itemized in a detailed budget to be provided to the Lender (the Cost Budget); and the currently projected date or dates for disbursement of such amounts shall be set forth in the cash flow forecast (the Cash Flow Forecast) to be provided to
the Lender. The term Project Costs, as used in this Agreement, shall mean the aggregate of (1) the cost of constructing the Improvements as provided in this Agreement; (2) the loan fees and expenses specified in this Agreement; and (3) the other
costs and expenses as the Lender may approve which have been incurred and will be incurred in connection with the construction and development of the Project. The Lender shall have the right to redetermine Project Costs as provided in this
Agreement. 
  
 Section 4. Disbursement of Loan Proceeds and
Other Funds. The disbursement of the Loan proceeds shall be made upon and subject to the following terms and conditions: 
  
 4.1 Advances; Equity Funds. 
  
 (a) Advances shall be conditioned upon the Borrower meeting the conditions set forth in Sections 4.2 and 4.3; and 
  
 (b) If requested by the Lender at any time during the term
of the Loan, the Borrower shall furnish to the Lender documentary evidence, satisfactory to the Lender, that the Borrower has expended or will have available for expenditure sufficient funds (Equity Funds) from its own assets and earnings, from
capital contributions or from a Subordinated Loan and Loans for the payment of that portion, if any, of Project Costs which exceeds the amount of the Loan. As used in this Agreement the term Subordinated Loan means a loan from another lender or
creditor who shall have executed an agreement, in form and substance satisfactory to the Lender (a) irrevocably and unconditionally subordinating such lender’s or creditor’s claim against the Borrower to the entire indebtedness owing by
the Borrower to the Lender under the Loan Documents, (b) irrevocably and unconditionally undertaking not to demand, assert, collect or enforce any part of such lender’s or creditor’s claim against the Borrower until such indebtedness owing
to the Lender is paid in full, and (c) waiving, to the extent of such lender’s or creditor’s loan to the Borrower, any right or rights which such lender or creditor may have to file an application for and notice of a mechanic’s or
materialman’s lien against the Property; 
  
 4.2
Application for Advances. 
  
 (a)
Applications for each advance under this Agreement for payments to the General Contractor shall be made by the Borrower on or about the first day of each month and at least fifteen (15) days before the date upon which the advance is desired. Each
such application shall be set forth on the Payment Request form approved by the Lender, executed by the Borrower and the General Contractor and, if required by the Lender, be accompanied by a written certification of the Lender’s Inspector (as
defined in Section 5.8). The application shall be for work actually done by the General Contractor under its Construction Contract and for materials and equipment actually incorporated into 

  

 9 

 
the Improvements or delivered to, inventoried and stored on the construction site for incorporation into the Improvements, during the preceding month (or, in
the case of the first such application, prior to the date of such application) and shall not exceed the value of all suitably stored materials and equipment and the value of the work, as certified by the Borrower, General Contractor and the
Lender’s Inspector, acceptably completed by the General Contractor to the date thereof, less a retention (the Retention) of ten percent (10%) and less the aggregate of all prior payments made to the General Contractor pursuant to the
Construction Contract. Retention will not be required after fifty percent (50%) of the work is completed. Such certification by the Borrower, General Contractor and the Lender’s Inspector (if any) shall state, among other things, that the
aggregate of all payments made to the General Contractor under the Construction Contract, plus the advance applied for, does not exceed one hundred percent (100%) of the value less the Retention — such value being calculated as if the work and
materials were part of a completed structure, as determined by the Lender — of all work acceptably done, all materials and equipment actually incorporated into the Improvements by the General Contractor to the date thereof, and all materials
and equipment delivered to and stored on the construction site (or off-site if approved in writing by the Lender) for incorporation into the Improvements; 
  
 (b) If any application for an advance is to cover, in whole or in part, a payment to the Borrower, the General Contractor or others for
the cost of hardware, machinery, apparatus, appliances, equipment or other materials (hereinafter collectively referred to as Materials) stored on or off the construction site, such application shall be accompanied by (a) evidence satisfactory to
the Lender that the Materials are stored at a suitable location agreed to by the Borrower and the Lender, are fully insured against damage or destruction for their full insurable value pursuant to a policy or policies under which the Lender and the
Borrower are additional loss payees and are properly identified and segregated from materials and equipment not intended to be incorporated into the Improvements, (b) unless the Materials shall, in the Lender’s opinion, be satisfactorily
covered by the Borrower, the General Contractor or a subcontractor (whichever shall have title to the Materials), granting to the Lender (if the Borrower shall have title) or granting to the Borrower (if the General Contractor shall have title) or
granting to the Borrower and the General Contractor (if the subcontractor shall have title), a security interest in the Materials, (c) a UCC Financing Statement appropriately completed, (d) unless the Lender shall be named as the secured party under
such security agreement, an assignment to the Lender from the Borrower or from the Borrower and the General Contractor (in case the General Contractor is a secured party) of the secured party or parties interest under such security agreement, (e)
unless the Lender shall be named as a secured party in such UCC Financing Statement, a UCC Financing Statement Amendment, appropriately completed by the necessary parties, perfecting the assignment of such security interest to the Lender, and (f)
documentary evidence satisfactory to the Lender that the Borrower has, at its own expense, duly recorded such UCC Financing Statement and UCC Financing Statement Amendment (if required); 
  
 (c) Applications on behalf of the Borrower for payment of any other Project costs shall be supported by
vouchers verified and approved in writing by the Borrower and such other evidence as shall be required by the Lender. Notwithstanding anything contained in the Cash Flow 

  

 10 

 
Forecast, disbursements for such costs shall be made at such times, in such amounts and to such parties as the Lender shall deem advisable; 
  
 (d) Each application for an advance shall be deemed a
certification by the Borrower that, as of the date of such application, all applicable representations and warranties contained in Section 2 are true and correct and that the Borrower is in compliance with all of the provisions of Sections 3 and 4
of this Agreement; and 
  
 (e) The Borrower
hereby constitutes and appoints the Lender its true and lawful attorney-in-fact to pay all such advances directly (a) to the General Contractor and to any subcontractors or other parties in payment of the sums due under its Construction Contract,
(b) to any other creditor furnishing labor or materials in connection with the construction or equipping of the Improvements and (c) to any other person or entity having a claim upon or who shall be a creditor of the Project, the Property or the
Collateral. This power-of-attorney shall be deemed to be a power coupled with an interest and shall be irrevocable. No further direction or authorization from the Borrower shall be necessary to warrant such direct advances, and all such advances
shall, to the extent of such advances, directly satisfy the obligations of the Lender hereunder, and shall be secured by the Mortgage and the Security Agreement in full as if made to the Borrower, regardless of the disposition thereof by any of the
General Contractor, subcontractors, materialmen or other parties; 
  
 4.3 Conditions Precedent to Each Advance. The Lender’s obligation to make each advance hereunder shall be subject to the fulfillment to the Lender’s satisfaction, as of the time of application and as of the time of the
advance, of all of the conditions precedent set forth in Section 3 as well as the conditions precedent set forth in this Section 4. 
  
 (a) Representations and Warranties. Applicable representations and warranties contained in Section 2 of this Agreement and
otherwise made by or on behalf of the Borrower in connection with the Loan shall be true and correct as of the time of each disbursement by the Lender under this Agreement, with the same effect as if made at such time; 
  
 (b) No Event of Default. There shall exist at the
time of each disbursement of Loan proceeds no condition which would constitute an Event of Default (as defined in Section 7 of this Agreement) or which, after notice or lapse of time or both, would constitute an Event of Default; 
  
 (c) Performance. The Borrower shall have performed
and complied with all agreements and conditions contained herein and required to be performed and complied with by the Borrower prior to each disbursement of Loan proceeds; 
  
 (d) Cost Overruns. The Borrower shall have fully complied with Sections 4.7 and 5.2 of this
Agreement; 
  

 11 

 (e) Schedule of Estimated Advances. The Borrower shall have furnished to the
Lender and the Lender shall have approved a schedule of the estimated amount and time of disbursement of each advance by the Lender; 
  
 (f) Compliance With Statutes, Ordinances and Regulations. The Borrower shall have furnished to the Lender a certification by the
General Contractor that the construction and equipping of the Improvements has complied and will continue to comply with all applicable statutes, ordinances, building codes, regulations and subdivision, zoning, land use, ecological and environmental
requirements; 
  
 (g) Satisfactory
Construction. The Borrower shall have furnished to the Lender a certification by the Borrower, the General Contractor and a certification by the Lender’s Inspector that the construction of the Improvements is proceeding satisfactorily in
accordance with the Plans and Specifications and with the Construction Contract. Such certification by the Lender’s Inspector, as well as any other certification required under this Agreement to be furnished by the Lender’s Inspector,
shall be separate from the Borrower’s and General Contractor’s certification and may state that it is being furnished for the sole benefit of the Lender. Each certification by the General Contractor and the Borrower shall include the
written representation that they have no cause or reason to believe that the remaining work under the Construction Contract cannot be completed on or before the completion date thereunder for an amount not greater than the aggregate amount of
undisbursed sums (excluding retentions pertaining to prior disbursements) shown on the detailed budget for payments under the Construction Contract. Any such certification may contain such exceptions or qualifications as may be deemed necessary by
the General Contractor or the Borrower in order to disclose fully and accurately the facts upon which such certification is based; provided, however, if the Lender shall not be satisfied with any such exception or with respect to the facts disclosed
in such certification, the Lender may withhold further advances until arrangements satisfactory to the Lender have been made (including, without limitation, the deposit of Equity Funds); 
  
 (h) Indorsement to Title Policy. The Lender shall obtain an indorsement to the Title Policy which by
its terms shall be made a part of the Title Policy, extending the coverage of the Title Policy to such advance as well as any other sums disbursed or credited as provided herein since the date of the last previous indorsement; 
  
 (i) Payment of Expenses of the Lender. The Borrower
shall have paid to the Lender all fees and expenses which the Lender shall determine to be due and payable as of the date of the application for such advance; 
  

(j) Notice to Proceed. Prior to the first advance to the General Contractor, the Borrower shall have delivered to the Lender a
duplicate original of the Notice to Proceed delivered by the Borrower to the General Contractor pursuant to the Construction Contract; 
  

 12 

 (k) Insolvency, Bankruptcy, Etc. No Borrower shall have become insolvent or shall
have become voluntarily or involuntarily dissolved (other than by reason of the death of any general partner of such party); or shall have made an assignment for the benefit of creditors; or shall have failed generally to pay its debts as they
become due; or shall have become the subject of an order for relief in an involuntary case under the bankruptcy laws as now or hereafter constituted, and such order shall remain in effect and unstayed for a period of sixty (60) consecutive days; or
shall have commenced a voluntary case under the bankruptcy laws as now or hereafter constituted; or shall have filed any petition or answer seeking for itself any arrangement, composition, adjustment, liquidation, dissolution or similar relief to
which it may be entitled under any present or future statute, law or regulation; or shall have filed any answer admitting the material allegations of any petition filed against it in any such proceedings; or shall have sought or consented to or
acquiesced in the appointment of or taking possession by any custodian, trustee, receiver or liquidator of it or of all or a substantial part of its properties or assets; or shall have taken any action looking to its dissolution or liquidation; or
within sixty (60) days after commencement of any proceedings against it seeking any arrangement, composition, adjustment, liquidation, dissolution or similar relief to which it may be entitled under any present or future statute, law or regulation,
such proceeding shall not have been dismissed; or within sixty (60) days after the appointment of or taking possession by any custodian, any trustee, receiver or liquidator of any or of all or a substantial part of its properties or assets, without
its consent or acquiescence, any such appointment or possession shall not have been vacated or terminated; and 
  
 (l) Survey. A perimeter survey, satisfactory to the Lender and the Title Insurer, and prepared and certified as correct by a
registered surveyor, disclosing (i) the location of the perimeter of the Property, (ii) all easements and rights-of-way, (iii) the lines of the street abutting the Property and the width thereof, (iv) the location of the Improvements and their
relation by distance to the perimeter of the Property, established setback lines and the street lines and (v) encroachments, if any; 
  
 The final advance to the General Contractor shall also be subject to the provisions of Section 4.4 of this Agreement and the conditions required by the
Lender by virtue of Section 4.5 of this Agreement; 
  
 4.4
Final Payment to the General Contractor. After both the completion of the construction specified by the Construction Contract and the expiration, without the filing of any applications for liens, of the statutory period for filing
applications for and notices of mechanic’s and materialmen’s liens pursuant to Section 507-43, H.R.S., as the same may be amended; and upon the satisfaction of all the conditions precedent set forth in Section 4.3, the Lender shall make an
advance to cover the final payment due to the General Contractor; PROVIDED, HOWEVER, that the construction shall not be considered complete for purposes of final payment unless and until the Lender shall have received: 
  
 (a) Evidence satisfactory to the Lender that construction
was substantially complete at the time of the first publication of the notice of completion for the Improvements and a certified copy of the affidavit of publication of notice of completion filed in the First Circuit Court of the State of Hawaii;

  

 13 

 (b) Evidence satisfactory to the Lender that all work under the Construction Contract
requiring inspection by county and other governmental authorities having jurisdiction has been duly inspected and approved by such authorities, that a Certificate of Occupancy for the Improvements has been issued by the City and County of Honolulu
and that all parties performing such work have been or will be paid for such work; 
  
 (c) A certification by the Borrower, the General Contractor and the Lender’s Inspector that the Improvements have been completed
substantially in accordance with the Plans and Specifications and the Construction Contract, that the Improvements as built conform with all applicable zoning, environmental, building and land use ordinances and regulations and no municipal
authority has issued any notice of violation or nonconformity in connection with the Improvements, that all utilities necessary for the use thereof have been connected to the Improvements, and that the Improvements are ready for occupancy;

  
 (d) A final perimeter survey, satisfactory to
the Lender and the Title Insurer, showing the completed Improvements and all easements on the Property together with a certification, addressed to the Lender and the Title Insurer, by a registered surveyor satisfactory to the Lender that the
Improvements lie wholly within the boundaries of the Property without encroachment or violation of any zoning ordinances, building regulations or setback requirements; and 
  
 (e) An indorsement to the Title Policy, which by its terms shall be made a part of the Title Policy,
extending the coverage of the Title Policy to the final advance; 
  
 4.5 Optional Conditions to Advance. The Lender may, as a condition precedent to the making of any advance, require the Borrower (i) to obtain and attach to each application for an advance executed acknowledgments of payment of all
sums due and releases of mechanic’s and materialmen’s liens for the sums covered by the immediately preceding advance; (ii) to furnish the Lender with an updated survey, prepared and certified as correct by a registered surveyor
satisfactory to the Lender, disclosing (a) that with respect to the Improvements there are no encroachments or violations of any applicable setback or violation of any applicable zoning ordinances, and (b) no state of facts objectionable to the
Lender; and (iii) to deliver to the Lender, concurrently with the making of the advance to cover the final payment to the General Contractor, duly executed acknowledgments of payment and releases of mechanic’s and materialmen’s liens, in
form satisfactory to the Lender, from the General Contractor and all subcontractors and materialmen dealing directly with the General Contractor, which acknowledgments of payment and releases of liens shall cover all work, labor and materials,
including equipment and fixtures of all kinds, done, performed or furnished for the construction and equipping of the Improvements; 
  
 4.6 Disbursements to Pay Interest. The Lender shall not be under any contractual obligation to make any disbursement of Loan proceeds for the
payment of interest on the Note. The Borrower shall be under no contractual obligation to request any such disbursement, but shall have the absolute right to use for such purpose funds available to it from other sources, including, but not limited
to, funds borrowed 

  

 14 

 
from another lender. The Lender shall not establish a separate account or reserve to fund any such disbursement to the Borrower. The Lender shall not be
obligated to make any disbursement of Loan proceeds to the Borrower for the purpose of paying such interest if an Event of Default has occurred hereunder or if the projected total Project Costs, as redetermined by the Lender at any time pursuant to
Section 5.2, shall exceed the aggregate of (a) Equity Funds deposited by the Borrower, (b) the Loan proceeds, and (c) additional funds deposited by the Borrower for payment of Cost Overruns pursuant to Section 5.2 of this Agreement. Each such
request by the Borrower shall constitute an offer to enter into a new contract amending this Agreement so as to obligate the Lender to disburse the amount requested, and if the Lender shall elect to honor that request, each such disbursement by the
Lender shall constitute the acceptance by the Lender of such offer and the resulting amendment of this Agreement, and such disbursement shall be evidenced by the Note and shall be secured by the other Loan Documents; 
  
 4.7 Monthly Disbursements Restricted to Amounts Shown in Each Category of
Costs for That Month. Notwithstanding any contrary provision in this Agreement, the Lender will not be obligated to disburse Loan proceeds for the payment of costs or expenses included in any category shown in the Borrower’s Cost Budget
(and as the same may be redetermined by the Lender pursuant to Section 5.2) in an amount which exceeds the amount set forth therein for such category, nor will the Lender be obligated to disburse in any month for payment of any category of costs an
amount which either exceeds the amount shown on the Borrower’s Cash Flow Forecast (and as the same may be redetermined by the Lender pursuant to Section 5.2 for disbursement that month or if added to the amounts disbursed in prior months for
that category would exceed the cumulative total for such month, unless (i) the Borrower furnishes to the Lender documentary evidence, satisfactory to the Lender, that any such excess is offset by an existing reduction in an equal or greater amount
in another cost category, or (ii) the Borrower complies with the provisions of Section 5.2 of this Agreement to assure the payment or subordination of such excess. If the amount of the Borrower’s monthly application submitted in conformity with
the provisions of Section 4 exceeds the amount set forth in the Cash Flow Forecast for the month, it is the Lender’s intention to waive the requirements set forth in clauses (i) and (ii) of the preceding sentence if the excess results solely
from the orderly and satisfactory completion of the Improvements earlier than contemplated; 
  
 4.8 Amounts and Order of Disbursement of Funds. The Loan proceeds and the Equity Funds shall be disbursed by the Lender pursuant and subject to the provisions of Section 4 of this Agreement in such amounts and
in such order of priority as the Lender shall determine in its sole judgment; 
  
 4.9 Conditions are Solely for Benefit of the Lender. All conditions of the obligations of the Lender to make advances hereunder are imposed solely and exclusively for the benefit of the Lender, its successors
and assigns and no other person shall have standing to require satisfaction of such conditions in accordance with their terms, and no other person (including, without limitation, any surety, contractor, subcontractor, materialman, unit purchaser, or
junior lienholder) shall, under any circumstances, be deemed to be the beneficiary of such conditions, any or all of which may be freely waived, in whole or in part, by the Lender at any time if, in its judgment, the Lender deems it advisable to do
so; 
  

 15 

 4.10 Advances Made to the Borrower; Trust Fund. All advances made to the Borrower hereunder shall
be held by the Borrower as a trust fund for the purpose of paying the Project Costs and the Borrower shall apply the same first to such payment before using any part thereof for any other purpose; and 
  
 4.11 Limitation of Responsibility. The making of any advance or part
of any such advance shall not be deemed to constitute an approval or acceptance by the Lender of the work theretofore done. Inspections and approvals of the Plans and Specifications, the Improvements and the workmanship and the materials used
therein and the exercise of any other right of inspection or inquiry granted to the Lender in this Agreement are solely for the benefit and protection of the Lender, and shall impose no responsibility or liability of any nature whatsoever on the
Lender, the Lender’s sole obligation hereunder being to make the advances if and to the extent required by this Agreement. 
  
 Section 5. Covenants of the Borrower Concerning Construction of the Improvements. The Borrower covenants and agrees with the Lender as follows:

  
 5.1 Compliance With Plans and Specifications, Construction
Contract and Applicable Laws and Ordinances. The Borrower shall cause the Improvements (i) to be constructed and equipped in a diligent and orderly manner and strictly in accordance with the Plans and Specifications approved by the Lender, the
Construction Contract and all applicable permits, ordinances, building codes, zoning laws, statutes and the requirements of all regulatory authorities having jurisdiction, (ii) to be constructed entirely on the Property, and not to encroach upon or
overhang any easement or right-of-way on the land of others, (iii) to be constructed wholly within any building restriction lines, however established, and (iv) not to violate any applicable use or other restrictions contained in prior conveyances,
zoning ordinances or regulations. 
  
 If requested by the Lender,
within five (5) business days after the foundation lines for any building or improvement requiring a building permit are physically established, the Borrower shall provide the Lender with a certification by a licensed surveyor satisfactory to the
Lender that such foundations are located wholly within the perimeter of the Property and that the Improvements to be constructed thereon will comply with all applicable setback and similar regulations. The Borrower shall strictly enforce each
Construction Contract to assure that the General Contractor promptly and diligently performs the obligations on its part to be performed thereunder in a manner preserving to the Lender its security in the Property and the Collateral. Promptly after
the Borrower discovers that any estimate or allowance in the Construction Contract will be insufficient, the Borrower shall give the Lender notice of such insufficiency. The Borrower will cause all the Improvements of the Project to be completed on
or before the Project Completion Date, which is September 2005. 
  
 5.2 Estimated Cost Overruns. The Lender may from time to time redetermine the projected total costs of the Project from current cost data and other information obtained by or otherwise made available to the Lender, including, but not
limited to, applications for advances made by the Borrower. If, in the sole judgment of the Lender, the projected total costs of the Project, as so redetermined, shall at any time exceed the total Project Costs specified in the Cost Budget
(including any revisions thereof which may be submitted by the Borrower and approved by the Lender), or if such projected total costs of the Project, as so 

  

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redetermined shall exceed the aggregate total of the funds available from the Loan and from Equity Funds previously deposited with the Lender to pay for such
projected total costs, then and in any such case, within ten (10) days after receipt of a written request from the Lender, the Borrower shall: 
  
 (a) deposit with the Lender for disbursement pursuant to this Agreement additional Equity Funds equal to the amount (“Cost
Overrun”) by which the projected total costs so redetermined by the Lender shall exceed the aggregate of (i) the Loan in the amount of THREE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($3,500,000.00) and (ii) any Equity Funds previously
deposited with the Lender; or 
  
 (b) furnish to
the Lender a letter of credit or other documentary evidence, in form and substance satisfactory to the Lender, confirming that sufficient additional Equity Funds are unconditionally and irrevocably committed by a financially responsible and
substantial investor or lender to the payment of the Cost Overrun; or 
  
 (c) deliver to the Lender documentary evidence satisfactory to the Lender that a creditor or creditors of the Borrower which has or have furnished services, labor, materials or equipment in connection with the
development of the Project has or have duly executed an agreement, in form and substance satisfactory to the Lender, (a) irrevocably and unconditionally subordinating, to the extent of the Cost Overrun, such creditors or creditors claim or claims to
the indebtedness owing by the Borrower to the Lender under the Loan Documents, (b) irrevocably and unconditionally undertaking not to enforce any part of their respective claims against the Borrower until such indebtedness owing to the Lender is
paid in full, and (c) waiving, to such extent, any right or rights which such creditor or creditors may have to file notice of mechanic’s or materialmen’s liens against the Project. The Lender may also require, in connection with such an
agreement, the written confirmation of any surety of such creditor that the surety’s obligation to the Lender is unimpaired by such agreement. 
  
 5.3 Damage or Destruction. In case of loss or damage to the Improvements by fire or other cause, the Borrower shall promptly repay the Loan in full
or use all available insurance proceeds in resuming construction of the Improvements, including the repair of all damage resulting from such fire or other cause and the restoration of the Improvements to their former condition. 
  
 5.4 Change Orders. All requests for changes in the Plans and
Specifications which alter the original Plans and Specifications, other than minor changes involving no extra cost, must be in writing, signed by the Borrower and the General Contractor, and shall be delivered to the Lender promptly after execution
and before performance of the work. The Borrower shall not permit the performance of any work pursuant to any Change Order materially affecting the value or use of the Improvements or which will result in an increase or decrease in the aggregate of
the contract prices for the construction of the Improvements in excess of TEN THOUSAND AND NO/100 DOLLARS ($10,000.00), nor pursuant to any Change Order which, together with the aggregate of change orders theretofore executed by the Borrower, will
result in total increases or total decreases in such prices in excess of ONE HUNDRED THOUSAND AND NO/100 DOLLARS 

  

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($100,000.00) for each Construction Contract, unless, in either case, it shall have received the written approval of the Lender to such Change Order. Each
such computation will be made prior to giving effect to any cost savings in such Change Order. As used herein, the term Change Order shall mean any change order or change bulletin or other instrument or understanding which may result in any change
of the contract price (whether an increase or decrease) or any other revision of whatever nature or form in the Construction Contract. Without limiting the generality of the foregoing, the Borrower will not direct or permit the performance of any
work pursuant to any Change Order which would result in a material change in the structural composition, the size or the quality of the improvements, without in each case the prior written approval of the Lender. The Borrower will obtain all
required consents of all bonding companies and all required permits or authorizations from governmental authorities having jurisdiction thereover before approving or requesting any Change Order, regardless of the price thereof. The Borrower will
submit copies of all Change Orders to the Lender’s Inspector regardless of the nature or size of such change or whether the Lender’s prior approval is required under this Section 5.5. 
  
 5.5 Modifications of Construction Contract or Other Contracts. The
Borrower shall not make or permit to be made any modification in the Construction Contract or any other contract between the Borrower and any other person or entity supplying labor, equipment or materials to the Improvements unless the Borrower
shall have received the prior written approval of the Lender. 
  
 5.6 Defects. The Borrower shall, upon demand of the Lender, promptly correct any defect in the Improvements or any departure form the Plans and Specifications not approved by the Lender. After any such request by the Lender, no
further work shall be done upon that portion of the Improvements so affected without the prior written consent of the Lender unless and until such defective condition has been corrected. 
  
 5.7 Liens. The Borrower shall not, without the prior written consent of the Lender, create, or suffer to be created,
any mechanic’s, materialmen’s, laborer’s, tax, statutory or other lien or charge upon the Improvements, the Property or the Collateral, or any part thereof, except liens, security interests or charges approved in writing by the Lender
and liens for taxes or assessments not yet payable or payable without penalty so long as payable. 
  
 5.8 Inspections. The Lender at its sole discretion may retain an inspector, engineer, architect or architectural firm (the Lender’s Inspector)
to review and inspect the Plans and Specifications, to inspect the construction of the Improvements, to report to the Lender on the conformity of such construction with the Plans and Specifications, to certify requests for Change Orders and advances
and to perform such other services as may be requested by the Lender. No consent, approval or other action by the Lender’s Inspector shall be deemed to be a release or waiver of any of the terms and conditions of this Agreement or the other
Loan Documents. 
  
 Any fees charged by third parties for the
review of plans, permits and monthly progress inspections and disbursements shall be for the account of the Borrower, however, such fees shall be limited to an amount of TWO HUNDRED FIFTY AND NO/100 DOLLARS ($250.00) per monthly inspection.

  

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 5.9 The Lender’s Right of Entry and Inspection. The Lender, the Lender’s Inspector and
the agents of either shall at all reasonable times during the construction of the Improvements have the right of entry upon and free access to the construction site and the right to inspect all work done, labor performed, materials and equipment
furnished with respect to such construction, and to inspect and to make extracts from or copies of, the Plans and Specifications as amended from time to time and all books, contracts, subcontracts, records and papers, wherever located, of the
Borrower relating to the Project. All such books, contracts, subcontracts, records and papers will be made available to the Lender, the Lender’s Inspector or the agents or either promptly upon demand by the Lender. The Lender shall be under no
duty to supervise or to inspect the work or construction or any books and records, it being understood that any such inspection by the Lender’s Inspector or the agents of the Lender is for the sole purpose of preserving the Lender’s rights
hereunder. Any such inspection not followed by notice of default shall not constitute a representation by the Lender that there has been or will be compliance with the Plans and Specifications or that the work is free from defective materials and
workmanship or that the Borrower is not otherwise in default hereunder. 
  
 5.10 Waste Materials. The Borrower shall keep the Property and the Improvements free from unreasonable accumulations of waste materials and refuse at all times, and prior to completion of the Improvements will remove or cause to be
removed all waste materials and refuse from and about the Property, and all tools, surplus materials and any and all structures and equipment utilized in connection with the prefabrication, erection and construction of the Improvements. 

 
 5.11 Default in Construction. If at any time prior to the
completion of the construction and equipping of the Improvements the same shall be abandoned or work thereon shall cease for any cause or causes other than those permitted by the Construction Contract, or if the Improvements are not completed for
purposes of final payment (as provided in Section 4.4) prior to the Completion Date described in Section 5.1, whichever is the first to occur, regardless of the reason for the delay, or if the Improvements shall not be constructed and equipped
substantially in accordance with the Plans and Specifications (except as to changes therein approved by the Lender or permitted by Section 5.5), or if changes shall be made in the Plans and Specifications without the Lender’s prior written
approval (except as to changes permitted by Section 5.5), or if the Borrower shall fail in any respect to comply with the provisions of this Agreement, then, and in any such event, the Lender, at its option, may refuse to make further advances, may
accelerate the indebtedness under the Note and other Loan Documents as provided in Section 7, and in addition, without thereby impairing any of the rights, powers or privileges of the Lender under any of the Loan Documents, may enter into possession
of the construction site and perform any and all work and labor necessary to complete the Improvements substantially according to the Plans and Specifications, and all sums expended by the Lender in so doing, including, but not limited to, a
construction supervision fee, payable to the Lender, up to ten percent (10%) of all such sums, shall be deemed to be paid for the account of the Borrower and secured by the Mortgage and the Security Agreement, notwithstanding that such expenditures
(including such fee) may exceed the amount of the loan or the cost of the Construction Contract or any other contracts. For this purpose, the Borrower hereby constitutes and appoints the Lender its true and lawful attorney-in-fact, with full power
of substitution, to complete such construction and equipping in the name of the Borrower, and hereby empowers such attorney or attorneys: 
  
 (a) To use any of the Loan proceeds and any Equity Funds which may remain unadvanced for the purpose of completing the construction and
equipping in the manner called for by the Plans and Specifications; 
  

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 (b) To make such changes and corrections in the Plans and Specifications as shall be
necessary or desirable to complete the construction in substantially the manner contemplated by the Plans and Specifications; 
  
 (c) To employ such contractors, subcontractors, agents, engineers, architects and inspectors as shall be required for such purposes;

  
 (d) To pay, settle or compromise all bills
and claims which may be or become liens or security interests against the Property or the Collateral, or any part thereof; 
  
 (e) To execute applications and certificates in the name of the Borrower which may be required by the Construction Contract, the Loan
Documents or any other agreement or instrument executed by the Borrower in connection with the Project; 
  
 (f) To prosecute, defend, compromise or settle, on such terms as the Lender sees fit in its sole discretion, all actions or proceedings in
connection with the construction of the Improvements or the Property or the Collateral, and to take such action and request such performance as such attorney deems necessary under the construction Contract, the Performance and Payment Bonds and the
Loan Documents; 
  
 (g) To submit any
applications to the Department of Land Utilization, and to prosecute and defend all actions, administrative or judicial, in connection therewith; and 
  
 (h) To do any and every other act which the Borrower might do in its own behalf. 
  
 This power of attorney shall be deemed to be a power coupled
with an interest and shall be irrevocable. The Borrower hereby assigns and quitclaims to the Lender all sums to be advanced under the Loan as well as all Equity Funds, conditioned upon the use of such sums in trust for the completion and equipping
of the Improvements and for payment of all sums due the Lender pursuant to the terms of the Loan Documents. 
  
 Section 6. Other Covenants of the Borrower. The Borrower covenants and agrees with the Lender as follows: 
  
 6.1 Financial Information. The Borrower shall (a) furnish to the
Lender with reasonable promptness such data and information, financial or otherwise, concerning the Borrower as from time to time may reasonably be requested by the Lender, including, but not limited to, (i) Borrower’s annual financial 

  

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statements and tax returns in a form acceptable to the Lender not later than one hundred twenty (120) days after each fiscal/calendar year; (ii)
Borrower’s quarterly interim financial statements within forty-five (45) days of each quarter end; and (iii) Borrower’s financial and supporting data as the Lender may reasonably require, reflecting all information concerning the financial
status and operations of the Borrower; (b) promptly notify the Lender of any condition or event which constitutes a breach or event of default of any covenant, condition, warranty, representation or provision of any of the Loan Documents and of any
materially adverse change in the financial condition of the Borrower; and (c) permit any authorized representative of the Lender to inspect the Borrower’s books of account (and to make extracts or copies therefrom) and to discuss the
Borrower’s affairs, finances and accounts with its accountants, agents and representatives, all at such reasonable times and as often as the Lender may reasonably request. 
  
 Borrower’s obligation to provide financial statements, tax returns and supporting data shall be superseded by reporting
requirements of the Securities and Exchange Act of 1934, in the event that Borrower becomes subject to such reporting requirements. 
  

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 6.2 Financial Standards. 
  
 (a) Borrower shall maintain a Liquidity Covenant of a minimum Cash Reserve Balance, commencing at the time this Loan
converts to an amortizing loan. The Cash Reserve Balance to be maintained shall be determined based upon the following grid: 
  

				
	 Loan Amount

	  	Cash Reserve

	 $2,000,000 - $2,499,999
	  	$	500,000
	 $2,500,000 - $2,999,999
	  	$	1,000,000
	 $3,000,000 - $3,500,000
	  	$	1,500,000

  
 Monthly cash position certificates
shall be submitted by the Borrower to the Lender for review and approval. 
  
 (b) Borrower shall maintain a quarterly Debt Service Coverage Ratio of at least 1.20:1.0. For the purposes of this Agreement, the Debt Service Coverage Ratio shall be defined as earnings before interest, taxes,
depreciation and amortization, divided by all scheduled principal and interest payments, including any capital lease payments. Such covenant shall be calculated quarterly on a rolling four-quarter basis, commencing with the quarter ending March 31,
2006. 
  
 6.3 Payment of Taxes. The Borrower shall pay or
cause to be paid all taxes, assessments or other governmental charges levied upon any of its properties or assets, or in respect of its income before the same become delinquent except that the Borrower will have the right to contest assessments and
other charges in the manner provided herein. 
  
 6.4
Litigation. The Borrower will give the Lender prompt notice of: 
  
 (a) any litigation or claims of any kind which might subject the Borrower to any liability in excess of ONE HUNDRED THOUSAND AND NO/100 DOLLARS ($100,000.00) whether covered by insurance or not; and 
  
 (b) all complaints and charges filed by any governmental
agency or any other party affecting the Property, or exercising supervision or control of the Borrower, or its respective businesses or assets which may impair the security of the Lender or adversely affect any of its right hereunder. 
  
 6.5 Compliance With Loan Documents and Other Documents. Borrower shall
duly perform and observe all covenants, conditions, undertakings and obligations to be performed by the Borrower under the Loan Documents. 
  
 6.6 Indemnification of the Lender. The Borrower shall indemnify and hold the Lender harmless from any and all claims asserted against the Lender by
any person, entity or governmental authority arising out of or in connection with the sale or use of the Property. The Lender shall be entitled to appear in 

  

 22 

 
any action or proceeding to defend itself against such claims and all costs incurred by the Lender in connection therewith, including attorney’s fees,
shall be reimbursed by the Borrower to the Lender within ten (10) days after presentment, as provided herein. Any failure to so reimburse the Lender within the specified time period shall constitute an Event of Default under this Agreement, and the
unreimbursed amount shall thereupon be added to the Loan and shall bear interest at the rate then in effect thereunder until paid. 
  
 The Lender shall, at its sole option, be entitled to settle or compromise any asserted claim against it, and such settlement shall be binding upon the
Borrower for purposes of this indemnification. Payment thereof by the Lender or the payment by the Lender of any judgment or claim successfully perfected against the Lender shall constitute an additional principal advance under the Loan, shall bear
interest at the Note rate and shall be payable upon demand of the Lender. The agreements contained in this section shall survive repayment of the Loan and shall survive the termination of any other portions of this Agreement. 
  
 6.7 Other Projects. The Borrower shall not enter into any agreements,
arrangements or ventures which shall impair its ability to perform its obligations under the Loan Documents. 
  
 6.8 Indebtedness. Without the Lender’s prior written consent, the Borrower shall not create, assume or guarantee or become or remain liable
for or committed to incur, directly or indirectly, any indebtedness except: 
  
 (a) indebtedness in respect of the Loan Documents; 
  
 (b) indebtedness for taxes, assessments, governmental charges or levies to the extent that payment thereof shall not at the time be
required to be made in accordance with the provisions herein; 
  
 (c) indebtedness incurred in the ordinary course of business (including trade payables and credit card debt) which will not materially impair the ability of the Borrower to repay the Loan; and 
  
 (d) indebtedness approved by the Lender. 
  
 6.9 Mortgages, Liens and Encumbrances. Without the Lender’s prior
written consent, the Borrower shall not incur or suffer to be created or incurred or to exist any encumbrance, mortgage, security interest, pledge, lien or charge of any kind upon the Property, whether now owned or hereafter acquired, or transfer
all or any of the same for the purpose of subjecting the same to the payment of any indebtedness or performance of any other obligation or acquire or have an option to acquire any property or assets upon conditional sale or other title retention
agreement, device or arrangement; PROVIDED, HOWEVER, that the Borrower may create or incur or suffer to be created or incurred or to exist: 
  
 (a) liens for taxes or assessments for governmental charges or levies if payment thereof shall not at the time be required to be made in
accordance with the provisions herein; 
  

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 (b) the lien and security interest of the Mortgage; and 
  
 (c) any other liens with the prior written approval of the
Lender. 
  
 The Borrower shall have the right to apply for
additional loans and advances from the Lender to be secured by an additional mortgage on the Property depending upon which mortgages are in full force and effect at the time such new proceeds are disbursed by the Lender; provided that the Borrower
shall not be in default under any terms and conditions of this Agreement, the Note, Mortgage and all other Loan Documents. 
  
 6.10 Merger or Sale. The Borrower will not merge or consolidate with any corporation or sell, assign, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) the Property or any interest therein or any assets of the Borrower (whether now owned or hereafter acquired) to, any person, other than as permitted by the Loan Documents. Without limiting the foregoing,
within thirty (30) days of receipt by the Lender of a written proposal by the Borrower for the sale of the Property, the Lender shall consider such proposal in its sole discretion, independent of the reasonableness of such proposal, and shall have
the right to approve or reject such proposal. A sale or transfer of fifty percent (50%) or more of the stock of the Borrower shall constitute a sale of the Borrower’s assets and will require the prior written consent of the Lender. 

 
 6.11 Investments, Loans and Advances. The Borrower shall not
directly or indirectly purchase or acquire any stock or other securities of or make or permit to remain outstanding any loan or advance to or investment in any corporation, association, partnership, organization or individual, except for repurchase
of company stock from employees pursuant to option agreements, or the exercise of right of first refusal or repurchase of restricted stock, so long as such repurchase or exercise does not materially impair the financial condition of the Borrower,
such as may be approved by the Lender. 
  
 6.12 Anticipation of
Payment. The Borrower shall not pay or discharge any of its obligations (other than the Note) prior to the maturity thereof, and shall not intentionally cause an accelerated maturity of any obligation. 
  
 6.13 Depository Accounts. Borrower shall maintain all of its operating
depository accounts with the Lender which shall continue throughout the term of the Loan. Fifty percent (50%) of all of Borrower’s designated funds held for corporate investment shall be invested through the Lender, including any monies raised
in the event of a Liquidity Event, which is defined as a large equity investment or public offering. 
  
 6.14 Cross-Default. Borrower’s default or breach under any note or agreement in which Lender has an interest shall be a breach under the Loan
Documents and Lender may invoke any of the remedies permitted by the Loan Documents. 
  

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 Section 7. Default; Remedies on Default. 
  
 7.1 Events of Default. If any of the following events (herein called
Events of Default) shall occur: 
  
 (a) The
Borrower shall default in the payment of principal or interest when due on the Note and such default shall continue for a period of ten (10) days after the same becomes due and payable; or 
  
 (b) The Borrower shall default in the performance of or
compliance with any term, covenant, condition or provision contained in any of the Loan Documents and such default shall not have been remedied within thirty (30) days after the Lender or any other person notifies the Borrower or the Borrower
acquires knowledge of such default, unless the Lender determines that such default cannot be cured within thirty (30) days and that the Borrower is proceeding promptly and diligently to cure such default; or 
  
 (c) The Borrower shall become insolvent or shall make an
assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or shall become the subject of an order for relief in an involuntary case under the bankruptcy laws as now or hereafter constituted and such order
shall remain in effect and unstayed for a period of thirty (30) consecutive days, or shall commence a voluntary proceeding under the bankruptcy laws as now or hereafter constituted, or shall file any petition or answer seeking for itself any
arrangement, composition, adjustment, liquidation, dissolution or similar relief to which it may be entitled under any present or future statutes, law or regulation, or shall file any answer admitting the material allegations of any petition filed
against it in any such proceedings; or the Borrower shall seek or consent to or acquiesce in the appointment of or taking possession by, any custodian, trustee, receiver or liquidator of all or a substantial part of its properties or assets; or
within thirty (30) days after commencement of any proceedings against it seeking any arrangement, composition, adjustment, liquidation, dissolution or similar relief to which it may be entitled under any present or future statutes, law or
regulation, such proceedings shall not have been dismissed; or within thirty (30) days after the appointment of, or taking possession, by, any custodian, trustee, receiver or liquidator of any or of all or a substantial part of the properties or
assets of the Borrower without its consent or acquiescence, any such appointment or possession shall not have been vacated or terminated; or 
  
 (d) There shall be any attachment, execution or other judicial seizure of, or affecting, the properties and assets of the Borrower or
affecting the Property or the collateral, or any part thereof unless the Borrower sets aside, dissolves, bonds off or otherwise eliminates such attachment, execution or seizure within thirty (30) days of its occurrence; or 
  
 (e) Any third person shall obtain an order or decree in any
court of competent jurisdiction enjoining or prohibiting the Borrower or the Lender from performing this Agreement or any Loan Document and such proceedings shall not be discontinued and such decree shall not be vacated within thirty (30) days after
the granting thereof; or 
  

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 (f) There shall be a sale, transfer, hypothecation, assignment or conveyance of the
Lender’s collateral or any portion thereof or interest therein, by the Borrower without the Lender’s prior written consent, except as otherwise provided in the Loan Documents; or 
  
 (g) Any representation made by or on behalf of the Borrower
herein or otherwise in writing in connection with the Loan shall prove to have been false or incorrect in any material respect on the date as of which such representation was made; or 
  
 (h) The Lender shall reasonably determine that there has been an adverse change in the financial condition
of the Borrower; or 
  
 (i) A final judgment
which alone or with other outstanding final judgments against the Borrower exceeds in the aggregate ONE HUNDRED THOUSAND AND NO/100 DOLLARS ($100,000.00) and shall not be discharged or have execution thereof stayed pending appeal within thirty (30)
days after entry of such judgment or shall not be discharged within thirty (30) days after the expiration of any such stay; or 
  
 (j) The Borrower shall default in the repayment of any other indebtedness owed to the Lender and such default shall not be waived or
remedied within thirty (30) days after the occurrence thereof or such further time permitted for the remedying of such default under the applicable documents; or 
  
 (k) Any governmental authority shall take any action or enact any rules which, in the Lender’s
judgment, may adversely affect the ability of the Borrower to repay the Loan; PROVIDED, HOWEVER, the occurrence of the foregoing shall not constitute an Event of Default so long as the Borrower either (i) promptly undertakes to reverse, stay or
rescind such action or ruling and effects such result within thirty (30) days from the date of such action, or (ii) promptly takes all steps necessary to comply with such action or ruling and thereby substantially mitigates, in the Lender’s
judgment, the adverse effect of such governmental action or rule within thirty (30) day of its occurrence; or 
  
 (l) All or any material portion of the Property shall be condemned, seized or appropriated without compensation and the Borrower shall
not, within thirty (30) days after such condemnation, seizure or appropriation, initiate and thereafter diligently prosecute appropriate action to contest in good faith the validity of such condemnation, seizure or appropriation; or 
  
 (m) The Improvements or any part thereof shall be
constructed in a manner other than as herein provided or approved by the Lender; or 
  
 (n) The Borrower shall fail to deposit with the Lender Equity Funds pursuant to Section 5.2 of this Agreement within fifteen (15) days
after receipt of written request for such funds from the Lender; or 
  

 26 

 (o) The Borrower shall be unable to satisfy any condition of its right to the receipt of
any disbursement of Loan proceeds hereunder for a period in excess of thirty (30) days; 
  
 THEN, AND IN ANY SUCH EVENT, the Lender, in addition to all remedies conferred upon the Lender by law and under the Loan Documents, shall have no further obligation to make advances under the Loan and shall
have the option to declare the Note to be due and payable, whereupon the entire aggregate unpaid principal balance under the Note shall forthwith mature and become due and payable, without presentment, demand, protest or notice of any kind, all of
which are hereby expressly waived and upon such maturity by acceleration or otherwise, the aggregate unpaid principal shall bear interest at the rate of TWENTY-FOUR PERCENT (24%) per annum. 
  
 The Lender shall give written notice of any such Event of Default to the
Borrower. 
  
 7.2 Additional Security. When any event shall
have occurred which, in the determination of the Lender, may endanger the fulfillment of any condition precedent to the obligations of the Lender hereunder or the observance or performance of any other agreement or covenant on the part of the
Borrower to be observed and performed under the Loan Documents, the Borrower shall furnish, within ten (10) days of written request by the Lender, additional security or Equity Funds which, in the opinion of the Lender, will be adequate to protect
the Lender against any such loss. In addition, upon the occurrence of such event, the Lender may advance funds or agree to undertake to advance funds to any third party to eliminate or reduce the risk of loss resulting from such event. Such
agreement or agreements by the Lender shall be in such form and have such content, the funds advanced shall be in such amount, and such advances shall be made at such time or times and upon such terms and conditions as the Lender, in its judgment,
deems appropriate, necessary or useful to eliminate, reduce or indemnify the Lender against any such danger. All sums paid or agreed to be paid by the Lender pursuant to such agreements or undertakings shall be for the account of the Borrower and
shall be without prejudice to the Borrower’s rights, if any, to receive such funds from the party to whom paid. The Borrower shall reimburse the Lender, upon demand, for any such sums paid by the Lender, together with interest at the rate
applicable to the Loan from the date of payment until the date of reimbursement. Such advances shall be secured by the Loan Documents. 
  
 7.3 Right of Contest. The Borrower shall have the right to contest in good faith any claim, demand, levy or assessment by a third party the
assertion of which would constitute an Event of Default hereunder; PROVIDED, HOWEVER, any such contest shall be prosecuted diligently and in a manner not prejudicial to the Lender hereunder; and, upon demand by the Lender, the contesting party shall
make suitable provision by payment to the Lender or by bond satisfactory to the Lender for the possibility that the contest will be unsuccessful. Such provision shall be made within ten (10) days after demand therefor and, if made by payment of
funds to the Lender, the amount so deposited shall be disbursed in accordance with the resolution of the contest either to the Borrower or the adverse claimant. 
  

7.4 Marshalling. The Borrower hereby waives, to the extent permitted by law, any and all rights to require any security given hereunder to be
marshalled and agrees and acknowledges that after the occurrence of any Event of Default, the Lender may, in its sole and absolute discretion, proceed to enforce its rights under the Loan Documents and to realize on any or all of the security for
the Loan or any portion or portions thereof, irrespective of the differing nature of such security and whether or not the same constitutes real or personal property. 
  

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 Section 8. Miscellaneous Provisions. 
  
 8.1 Time of Payment. All prepayments and payments of principal under this Loan shall be credited against the Loan or
credited to payment of other obligations of the Borrower under the Loan Documents on the date of receipt by the Lender so long as: 
  
 (a) the payment is received by the Lender prior to noon, Hawaii Standard Time; and 
  
 (b) the form or payment is in federal funds or other
immediately available funds. 
  
 If condition (a) is not satisfied
and condition (b) is satisfied, the payment will be credited on the first business day following the date or receipt by the Lender of the instrument of payment. If condition (a) is satisfied, credit will be made on the first business day which the
Lender actually receives the funds represented by the instrument of payment. 
  
 8.2 Authority to File Notices. The Borrower irrevocably appoints, constitutes and designates the Lender its attorney-in-fact to file or record any notice of completion or cessation of labor or any other notice
that the Lender deems necessary or desirable to protect its interest hereunder or under any other Loan Document. Such power shall be deemed coupled with an interest and shall be irrevocable while any sum remains due and owing under any of the Loan
Documents or any obligation of the Borrower thereunder remains unperformed. 
  
 8.3 The Lender’s Right to Sell Participations in the Loan. The Lender may at any time sell, assign, transfer, negotiate, grant participations in, or otherwise dispose of, to any one or more other lender or
lenders (herein called Participants), all or any part of the indebtedness of the Borrower at any time outstanding under any of the Loan Documents. The Borrower acknowledges and agrees that any such disposition will give rise to an obligation of the
Borrower to each Participant and that, in such event, each Participant shall, for all purposes hereof, be entitled to the benefits of the Loan Documents and all other documents, instruments and agreements therein described, as its interest may
appear. The Borrower hereby authorizes the Lender and each Participant, in case of default by the Borrower hereunder, to proceed directly by right of offset, banker’s lien or otherwise against any assets of the Borrower which may at the time of
such default be in the hands of the Lender or any Participant, to the full extent of their respective interests in the Loan; PROVIDED, HOWEVER, that the total amount realized by all lenders upon the exercise of such rights shall not exceed the then
total obligations of the Borrower under the Loan Documents. The Borrower shall, from time to time at the request of any Participant, execute and deliver, or cause to be executed and delivered, to the Lender and any Participant or to such party or
parties as the Lender and any Participant may designate, any and all such further instruments as may in the opinion of the Lender and any Participant be necessary or desirable to give full force and effect to such disposition, including, but not
limited to, a new note or new notes to be issued in exchange for the Note and such estoppel certificates or other instruments as may be requested from the Borrower to evidence the continuing validity of the Loan Documents and the absence of any
default by the Lender thereunder. In addition, the Borrower shall furnish the Lender all financial and other information 

  

 28 

 
relating to the Loan, the Property or the Borrower as may be requested by any Participant or prospective Participant. Notwithstanding the foregoing, Borrower
acknowledges that no Participant shall be deemed a direct lender or co-lender with the Lender. 
  
 8.4 Construction Prior to Recordation of Mortgage. The Borrower has commenced construction work and/or the furnishing of materials to or in connection with the Property and the Improvements, therefore,
indemnity arrangements satisfactory to the Lender are required to be concluded with the Title Insurer prior to the recordation of the Mortgage. 
  
 8.5 Proceedings, Surveys and Documents Must Be Satisfactory to the Lender. All proceedings taken in connection with the transactions provided for
herein, all surveys, appraisals and any other documents, papers, drawings and other things required or contemplated by this Agreement and the person or persons responsible for the execution and preparation thereof shall be satisfactory to the
Lender, and the Lender’s counsel shall have received copies (or certified copies where appropriate in such counsel’s judgment) of all documents which it may request in connection therewith. 
  
 8.6 Actions. The Lender shall have the right to commence, appear in or
defend any action or proceeding purporting to affect the rights, duties or liabilities of the parties hereunder, or the disbursement of any Loan funds. In connection therewith, the Lender may incur and pay reasonable costs and expenses, including,
but not limited to, reasonable attorney’s fees. The Borrower shall pay to the Lender on demand all such expenses and the Lender is authorized to disburse funds from the Loan for such purposes. 
  
 8.7 Timeliness; Term of Agreement; Survival of Representations and
Warranties. Time is of the essence in this Agreement. This Agreement shall continue in full force and effect until all indebtedness of the Borrower to the Lender under the Loan Documents shall have been paid in full, and all obligations of the
Borrower under the Loan Documents shall have been fully observed and performed. All representations and warranties contained herein or made in writing by or on behalf of the Borrower in connection with the Loan shall survive the execution and
delivery of the Loan Documents and any investigation at any time made by, through or on behalf of the Lender. All statements contained in any certificate or other instrument delivered to the Lender on behalf of the Borrower pursuant hereto or
otherwise in connection with the Loan shall constitute representations and warranties hereunder. 
  
 8.8 Amendments and Waivers. Neither this Agreement nor any provision hereof may be amended, waived, discharged or terminated orally, but only by an
instrument in writing, signed by the party against whom enforcement of the amendment, waiver, discharge or termination is sought. The affirmative and negative covenants of the Borrower are solely for the benefit of the Lender, who may waive or fail
to enforce any or all of them without affecting the liability of the Borrower. 
  
 8.9 Remedies Are Cumulative. All rights, powers and remedies herein given to the Lender are cumulative and not alternative, are in addition to all rights, powers and remedies afforded by statutes or rules of
law and may be exercised concurrently, independently, or successively in any order whatsoever. 

  

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Without limiting the generality of the foregoing, the Lender may enforce any one or more of the Loan Documents without enforcing all of them concurrently or
in any particular order. 
  
 8.10 No Waiver. No failure,
forbearance or delay on the part of the Lender in exercising any power or right under any of the Loan Documents shall operate as a waiver of the same or any other power or right, and no single or partial exercise of any such power or right shall
preclude any other or further exercise thereof or the exercise of any other such power or right. No advance of Loan proceeds by the Lender hereunder shall constitute a waiver of any of the conditions precedent to the Lender’s obligations to
make further advances, nor, in the event the Borrower is unable to satisfy any such condition, shall any such waiver have the effect of precluding the Lender from thereafter declaring such inability to be an Event of Default as provided in this
Agreement. 
  
 8.11 No Joint Venture. The execution of this
Agreement, the making of the Loan and the exercise of any rights hereunder are not intended and shall not be construed to create a partnership or joint venture between the Lender and the Borrower. 
  
 8.12 Consents of the Lender. In all events where the consent of the
Lender is required under the terms of any Loan Document, the Lender shall grant or refuse such consent within a reasonable period of time following the receipt of such request, in writing and accompanied by all documents and information required by
the Lender for the purpose of its review and consideration of the Borrower’s request for consent or approval; and its consent will not be unreasonably or arbitrarily withheld or delayed. The standard to be applied in determining whether the
Lender’s granting or denial of consent is reasonable shall be the standard of prudent banking practice, taking into consideration all circumstances prevailing at the time any such consent or approval shall be requested, including (without
limitation thereto) the size and nature of the Loan and any laws and regulations applicable to the Lender or any of the Participants. No consent or approval shall be effective unless and until given by the Lender in writing, executed by a duly
authorized agent of the Lender. 
  
 8.13 Approval by
Lender. The Borrower covenants and agrees with the Lender that Borrower shall obtain the Lender’s prior written approval of all documents filed in the Office of the Assistant Registrar of the Land Court or the Bureau of Conveyances of the
State of Hawaii, or filed with the Department of Commerce and Consumer Affairs, for any purpose with respect to the Property, the Improvements or the Project. The Borrower will make or will cause to be made all changes to any of such documents which
may from time to time be requested by the Lender or its counsel in order that, in the opinion of the Lender and its counsel, such documents will comply with all applicable ordinances, statutes, regulations or regulatory requirements. 
  

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 8.14 Notices. All notices, requests, demands or documents which are required or permitted to be
given or served hereunder shall be in writing and personally delivered, or sent by registered or certified mail addressed as follows: 
  

			
	To BORROWER at:	  	 HOKU SCIENTIFIC, INC.
 2153 North King Street, Suite
300
 Honolulu, Hawaii 96819

		
	To LENDER at:	  	 CENTRAL PACIFIC BANK
 P. O. Box 3590
 Honolulu, Hawaii 96811-3590

  
 The addresses may be changed from time
to time by the addressee by serving notice as heretofore provided. Service of such notice or demand shall be deemed complete on the date of actual delivery as shown by the addressee’s registry or certification receipt or at the expiration of
the third day after the date of mailing, whichever is earlier in time. 
  
 8.15 Entire Agreement. The Loan Documents constitute all of the agreements between the parties relating to the Loan and supersede all other prior or concurrent oral or written letters, agreements or understandings. 
  
 8.16 Assignment; Parties in Interest. The Lender shall have the right
to assign its interest in this Agreement to any subsequent holder or holders of the Note. The Borrower shall not assign this Agreement without the prior written consent of the Lender. All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors and assigns, and, in particular, shall inure to the benefit of and be enforceable by the holder or holders from time to time of the
Note or any part thereof or interest therein. 
  
 8.17 Headings
of Paragraphs. The headings of paragraphs and subparagraphs herein are inserted only for convenience and reference and shall in no way define, limit or describe the scope or intent of any provision of this Agreement. 
  
 8.18 Applicable Law. This Agreement is executed and delivered in and
shall be construed and enforced in accordance with the laws of the State of Hawaii. 
  
 8.19 Waiver of Right to Jury Trial; No Offset by Borrower. The Lender and Borrower knowingly and voluntarily waive the right to trial by jury in any lawsuit, action or proceeding arising out of or related to
this Agreement. The Borrower waives the right to assert as an offset to its liability under this Agreement any counterclaim it may have against the Lender, it being agreed that the Borrower’s liability to the Lender under this Agreement shall
be distinct and independent of any liability owed by the Lender to the Borrower. 
  
 8.20 Severability. If any provision of this Agreement or the other Loan Documents is held to be invalid or unenforceable, the validity and enforceability of the other provisions of this Agreement and the other
Loan Documents will remain unaffected. 
  

 31 

 8.21 Terms and Conditions of This Agreement Supplement Other Loan Documents. The terms and
conditions of this Agreement and the covenants, representations and warranties of the Borrower under this Agreement shall not be deemed to supersede, amend or modify the obligations and duties of the Borrower under the other Loan Documents. The
terms and conditions of this Loan Agreement and the covenants, representations and warranties of the Borrower hereunder merely supplement and do not supplant or supersede provisions of similar effect or subject matter in the other Loan Documents.

  
 8.22 Agents. In exercising any rights under this
Agreement or the other Loan Documents, the Lender may act through its employees, agents or independent contractors. 
  
 IN WITNESS WHEREOF, the Lender and the Borrower have executed this Agreement on the day and year first above stated. 
  

					
	CENTRAL PACIFIC BANK
		
	By	 	/s/    Robert Kamemeto
	 	 	 Its
	 	Senior Vice President
			
	 	 	 	 	Lender

  

					
	 HOKU SCIENTIFIC, INC.,
a Delaware corporation

		
	By	 	/s/    Dustin M. Shindo
	 	 	 Its
	 	Chief Executive Officer and President
			
	 	 	 	 	Borrower

  

 32

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