Indenture Agreement among AMS-2 2002, LP and Bank One, National Association, dated August 21, 2002

Contract Categories: Business Finance › Indenture Agreements
Summary

This agreement is made between AMS-2 2002, LP (the issuer) and Bank One, National Association (acting as both indenture trustee and eligible lender trustee). It sets out the terms for issuing, registering, and managing notes, including the rights and obligations of both parties. The agreement covers how notes are handled, payment procedures, default events, and the trustee’s duties. It also includes provisions for the protection of trust assets and the process for resolving defaults. The agreement is effective as of August 21, 2002.

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EX-10.71 3 d00883exv10w71.txt INDENTURE AGREEMENT EXHIBIT 10.71 ================================================================================ INDENTURE DATED AS OF AUGUST 21, 2002 AMONG AMS-2 2002, LP, AS ISSUER, AND BANK ONE, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE AND ELIGIBLE LENDER TRUSTEE ================================================================================ TABLE OF CONTENTS
PAGE Article I THE NOTES.............................................................................3 Section 1.01. Form of Notes..............................................................3 Section 1.02. Execution, Authentication and Delivery.....................................3 Section 1.03. Registration; Registration of Transfer and Exchange........................4 Section 1.04. Mutilated, Destroyed, Lost or Stolen Notes.................................5 Section 1.05. Persons Deemed Owner.......................................................6 Section 1.06. Certain Issuance and Transfer Restrictions.................................6 Section 1.07. Legending of Notes.........................................................8 Section 1.08. Provision of Information to Prospective Purchasers of the Notes; Rule 144A Matters....................................................................9 Section 1.09. Cancellation...............................................................9 Section 1.10. Book-Entry Notes..........................................................10 Section 1.11. Notices to Clearing Agency................................................11 Section 1.12. Definitive Notes..........................................................11 Section 1.13. Payment of Principal and Interest; Defaulted Interest; Noteholders' Interest Basis Carryover..................................................11 Article II REPRESENTATIONS AND WARRANTIES.......................................................15 Section 2.01. Representations and Warranties of the Issuer..............................15 Section 2.02. Reassignment upon Breach..................................................17 Section 2.03. Representations and Warranties of General Partner.........................18 Section 2.04. Representations and Warranties of Indenture Trustee.......................19 Section 2.05. Representations and Warranties of Eligible Lender Trustee.................19 Article III GENERAL COVENANTS OF THE ISSUER......................................................20 Section 3.01. Payment to Noteholders....................................................20 Section 3.02. Money for Payments to Be Held in Trust....................................20 Section 3.03. Existence.................................................................22 Section 3.04. Protection of Indenture Trust Estate......................................22 Section 3.05. Performance of Obligations................................................23 Section 3.06. Reporting Requirements of the Issuer......................................25 Section 3.07. Servicing Covenants.......................................................26 Section 3.08. Negative Covenants of the Issuer..........................................27 Section 3.09. Issuer May Consolidate, etc., Only on Certain Terms.......................28 Section 3.10. Successor or Transferee...................................................29 Section 3.11. No Other Business.........................................................30 Section 3.12. No Borrowing..............................................................30 Section 3.13. Guarantees, Loans, Advances and Other Liabilities.........................30 Section 3.14. [Reserved]................................................................30 Section 3.15. The Funding Account.......................................................30
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PAGE Article IV SATISFACTION AND DISCHARGE...........................................................30 Section 4.01. Satisfaction and Discharge of Indenture...................................30 Section 4.02. Application of Trust Money................................................32 Section 4.03. Repayment of Monies Held by Paying Agent..................................32 Article V REMEDIES.............................................................................32 Section 5.01. Events of Default.........................................................32 Section 5.02. Acceleration of Maturity; Rescission and Annulment........................33 Section 5.03. Collection of Indebtedness and Suits for Enforcement by Indenture Trustee.34 Section 5.04. Remedies; Priorities......................................................37 Section 5.05. Optional Preservation of the Indenture Trust Estate.......................39 Section 5.06. Limitation of Suits.......................................................39 Section 5.07. Unconditional Rights of Noteholders to Receive Principal and Interest.....40 Section 5.08. Restoration of Rights and Remedies........................................40 Section 5.09. Rights and Remedies Cumulative............................................40 Section 5.10. Delay or Omission Not a Waiver............................................40 Section 5.11. Control by Noteholders....................................................40 Section 5.12. Waiver of Past Defaults...................................................41 Section 5.13. Undertaking for Costs.....................................................41 Section 5.14. Waiver of Stay or Extension Laws..........................................42 Section 5.15. Action on Notes...........................................................42 Section 5.16. Performance and Enforcement of Certain Obligations........................42 Article VI INDENTURE TRUSTEE....................................................................44 Section 6.01. Acceptance of the Trusts..................................................44 Section 6.02. Fees, Charges and Expenses of Indenture Trustee...........................46 Section 6.03. Notice if Default Occurs..................................................46 Section 6.04. Intervention by Indenture Trustee.........................................46 Section 6.05. Successors................................................................46 Section 6.06. Resignation...............................................................46 Section 6.07. Removal...................................................................47 Section 6.08. Appointment of Successor..................................................47 Section 6.09. Concerning Any Successor..................................................47 Section 6.10. Appointment of Co-Trustee.................................................47 Section 6.11. Successor Indenture Trustee as Trustee of Funds...........................48 Section 6.12. Indemnification...........................................................48 Section 6.13. Eligibility Requirements for Indenture Trustee............................49 Section 6.14. Tax Information...........................................................49
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PAGE Article VII [RESERVED]...........................................................................49 Article VIII SETTLEMENTS..........................................................................49 Section 8.01. Trust Accounts; Investments by Indenture Trustee..........................49 Section 8.02. Collection of Moneys......................................................51 Section 8.03. Collection Account........................................................52 Section 8.04. Reserve Account...........................................................54 Section 8.05. Funding Account...........................................................54 Section 8.06. [Reserved]................................................................55 Section 8.07. [Reserved]................................................................55 Section 8.08. [Reserved]................................................................56 Section 8.09. Capitalized Interest Account..............................................56 Article IX REDEMPTION...........................................................................57 Section 9.01. Redemption................................................................57 Section 9.02. Form of Redemption Notice.................................................57 Section 9.03. Notes Payable on Redemption Date..........................................58 Article X MISCELLANEOUS........................................................................58 Section 10.01. Amendments, Etc...........................................................58 Section 10.02. Notices, Etc..............................................................60 Section 10.03. No Waiver; Remedies.......................................................60 Section 10.04. Binding Effect; Survival..................................................60 Section 10.05. Costs, Expenses and Taxes.................................................60 Section 10.06. No Proceedings............................................................61 Section 10.07. Captions and Cross References.............................................61 Section 10.08. Integration...............................................................61 Section 10.09. Governing Law.............................................................61 Section 10.10. Waiver of Jury Trial......................................................62 Section 10.11. Execution in Counterparts.................................................62 Section 10.12. Usury.....................................................................62 Section 10.13. Compliance Certificates and Opinions......................................62
iii APPENDICES APPENDIX A Definitions APPENDIX B [Reserved] APPENDIX C Student Loan Schedule APPENDIX D [Reserved] SCHEDULE SCHEDULE 2.01(k) List of Offices of the Issuer where Records Are Kept EXHIBITS EXHIBIT 1.01(a) Form of Class A Note EXHIBIT 1.01(d) Form of Class B Note EXHIBIT 1.01(a) Form of Purchaser's Letter EXHIBIT 1.06(b)(i) Form of Transfer Certificate for Class A Notes EXHIBIT 1.06(b)(ii) Form of Transfer Certificate for Class B Notes EXHIBIT 3.06(d) Form of Quarterly Report iv INDENTURE Dated as of August 21, 2002 THIS IS AN INDENTURE, among AMS-2 2002, LP, a Delaware limited partnership, ("Issuer") and BANK ONE, NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States ("Bank One"), as indenture trustee hereunder (in such capacity, and together with any successor thereto in such capacity, the "Indenture Trustee") and as eligible lender trustee (in such capacity, and together with any successor thereto in such capacity, the "Eligible Lender Trustee"). Unless otherwise indicated, capitalized terms used in this Indenture are defined in Appendix A. BACKGROUND (i) The Issuer is a limited partnership with Academic Management Services Corp., a Delaware corporation ("AMS") as its Limited Partner and AMS-2 SPC-1, Inc., a Delaware corporation, as its General Partner (the "General Partner"). (ii) Pursuant to the Purchase and Contribution Agreement, Bank One, in its capacity as Eligible Lender Trustee, has purchased and from time to time will continue to purchase, in each case, at the direction of and on behalf of the Issuer, from Bank One, in its capacity as eligible lender trustee for AMS, Student Loans. The legal title to the Student Loans is held or will be held by the Eligible Lender Trustee on behalf of the Issuer. (iii) The Issuer intends to finance the purchase of the Student Loans by issuing the Class A Notes and Class B Notes, which it will sell to the Initial Purchaser identified in the Note Purchase Agreement. (iv) The payment of the principal of and interest on the Notes will be secured by the Financed Student Loans and other Collateral. (v) The Class B Notes are subordinated in right of payment to the Class A Notes to the extent set forth herein. (vi) Bank One has been requested, and is willing, to act as the Indenture Trustee. NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the parties hereto agree as follows: GRANTING CLAUSE The Issuer and, with respect to the legal title of the Student Loans, the Eligible Lender Trustee hereby Grant to the Indenture Trustee at the Closing Date, as trustee for the benefit of the Noteholders and the Swap Counterparties, all the Issuer's right, title and interest in and to, but none of its obligations under, the following: (i) the Initial Financed Student Loans, and all obligations of the Obligors thereunder including all monies paid thereunder on and after the Initial Cutoff Date, including all Subsidy Payments and all Related Security with respect thereto; (ii) the Additional Financed Student Loans, and all obligations of the Obligors thereunder including all monies paid thereunder on and after the Cutoff Date, including all Subsidy Payments and all Related Security with respect thereto; (iii) the Purchase and Contribution Agreement; (iv) the Servicing Agreement; (v) each Student Loan Guarantee Agreement with respect to the Student Loans comprising part of the Financed Student Loans, including the right of the Issuer and the Eligible Lender Trustee to cause the related Student Loan Guarantor to make Guarantee Payments in respect of the Financed Student Loans; (vi) the Trust Agreement; (vii) all funds on deposit from time to time in the Trust Accounts and in all investments and proceeds thereof (including all income thereon); (viii) all books and records (including computer tapes and disks) related to the foregoing; and (ix) 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, Trust Accounts, Trust Accounts receivables, notes, drafts, acceptances, chattel paper, checks, deposit Trust 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 and to secure compliance with the provisions of this Indenture, subject to, and as further provided in this Indenture. The Indenture Trustee, as Indenture Trustee on behalf of the Noteholders, 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 and the Transaction Documents in accordance with their terms. 2 Article I THE NOTES Section 1.01. Form of Notes. (a) The Class A Notes and Class B Notes in each case together with the Indenture Trustee's certificate of authentication, shall be in substantially the form set forth in Exhibit 1.01(a) and Exhibit 1.01(b), respectively, 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 Authorized Officer of the General Partner executing such Notes on behalf of the Issuer, as evidenced by such Authorized Officer's execution of such Notes only. The Notes shall be issued on the Closing Date in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof, and will be available in book-entry form only. (b) With respect to each Class of Notes, the Indenture Trustee shall record in its records the interest rate for each Interest Period with respect to such Class, each repayment thereof, and the other information provided for thereon. The Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods (with or without steel engraved borders), all as determined by the Authorized Officer of the General Partner executing each such Note on behalf of the Issuer, as evidenced by such Authorized Officer's execution of such Note. Each Note shall be dated the date of its authentication, and the terms of the Notes set forth in Exhibit 1.01(a) and Exhibit 1.01(b), respectively, are part of the terms of this Indenture. Section 1.02. Execution, Authentication and Delivery. (a) Execution of the Notes. The Notes shall be executed on behalf of the Issuer by any of the Authorized Officers of the General Partner. The signature of any such Authorized Officer on any Note may be original or facsimile. Any Note bearing the original or facsimile signature of an individual who was at any time an Authorized Officer of the General Partner of the Issuer shall bind the Issuer, notwithstanding that such individual has ceased to hold such office prior to the authentication and delivery of such Note or did not hold such offices at the date of such Note. (b) Authentication of the Notes. The Indenture Trustee shall upon receipt of the Issuer Order, authenticate and deliver (i) the Class A Notes for original issue in an aggregate principal amount of $288,000,000 (the "Class A Original Note Principal Amount") and (ii) the Class B Notes for original issue in an aggregate principal amount of $12,000,000 (the "Class B Original Note Principal Amount"). The aggregate principal amount of each Class of Notes outstanding at any time shall not exceed its respective Original Note Principal Amount except as provided in Section 1.04. Each of the Notes shall be dated the date of its authentication. No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears 3 attached to 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 attached to any such Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder. Section 1.03. Registration; Registration of Transfer and Exchange. (a) Note Register; Note Registrar. 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 the Notes and the registration of transfers of the Notes. The Indenture Trustee shall be "Note Registrar" for the purpose of registering Notes and transfers of the 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. (b) Appointment of Note Registrar. If a Person other than the Indenture Trustee is appointed by the Issuer as Note Registrar, the Issuer will 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. 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 related principal amounts and numbers of such Notes. (c) Transfer of the Notes. Upon surrender for registration or transfer of a Note at the office or agency of the Issuer to be maintained as provided in Section 1.03(e), and if the requirements of Section 8-401(l) of the UCC are met, the Issuer shall execute and cause the Indenture Trustee to authenticate a new Note, in any authorized denominations of like aggregate principal amount. Any Note issued upon any registration of transfer thereof shall be the valid obligation of the Issuer, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Note surrendered upon such registration of transfer. 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 Note Registrar 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. (d) No Service Charge. No service charge shall be made to a Noteholder, for any registration of transfer or exchange of any Note, but the Note Registrar 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 a Note. 4 (e) Maintenance of Office or Agency. The Issuer will maintain in New York, New York, an office or agency where the Notes may be surrendered for registration of transfer thereof, 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 will 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 1.04. Mutilated, Destroyed, Lost or Stolen Notes. (a) Replacement of 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 Indenture Trustee and the Issuer such security or indemnity as may be required by 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 seven days shall be due and payable, the Issuer may, instead of issuing a replacement Note, direct the Indenture Trustee, in writing, to pay such destroyed, lost or stolen Note when so due or payable without surrender thereof. If, after the delivery of a replacement Note or payment of a destroyed, lost or stolen Note or 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 such original Note for payment, 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. (b) Payment of Tax. Upon the issuance of any replacement Note under this Section, the Issuer or the Indenture Trustee may require the payment by the related Noteholder 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 or the Note Registrar) connected therewith. (c) Enforcement of Replacement Notes. 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 5 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. (d) Exclusiveness of Section. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. Section 1.05. 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 and the Indenture Trustee may treat the Person in whose name any such Note is registered (as of the Record Date) as the owner of such Note for the purpose of receiving payments of principal of and interest, if any, on such Note, and for all other purposes whatsoever, whether or not such Note be overdue, and none of the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture Trustee shall be affected by notice to the contrary. Section 1.06. Certain Issuance and Transfer Restrictions. (a) Issuance and Transfer of the Notes. The Notes may be resold only (i) to "qualified institutional buyers" within the meaning of Rule 144A under the Securities Act, (ii) to non-U.S. Persons in transactions outside the United States in accordance with Rule 903 of Regulation S under the Securities Act, or (iii) pursuant to any other available exemption from the registration requirements of the Securities Act, subject to certain restrictions. Additionally, each purchaser of Notes will be deemed to have represented and agreed as follows: (A) It is (i) purchasing the Notes for its own account or an account with respect to which it exercises sole investment discretion and it or such account is a "QIB" ("Qualified Institutional Buyer") and is aware that the sale to it is being made in Reliance on Rule 144A under the Securities Act ("Rule 144A") and is acquiring such Notes for investment and not with a view to, or for offer or sale in connection with, any distribution (within the meaning of the Securities Act of 1933) or fractionalization thereof or with any intention of reselling the Notes or any part thereof, subject to any requirement of law that the disposition of its property or the property of such account or accounts be at all times within its or their control and subject to its or their ability to resell such Notes pursuant to Rule 144A or (ii) not a U.S. person (as such term is defined in Regulation S under the Securities Act) and is purchasing Notes outside the United States pursuant to Regulation S. (B) It acknowledges that the Notes have not been registered under the Securities Act of 1933 and may not be sold within the United States or to, or for the account of, U.S. persons except as permitted below. 6 (C) If (1) it is a person other than a foreign purchaser outside the United States, it agrees that (i) if it should reoffer, resell, pledge or otherwise transfer its Note prior to the second anniversary of the later of (a) the original issuance of such Note (or any predecessor Note), and (b) the sale of such Note (or any predecessor Note) by the Issuer or any affiliate of the Issuer (computed in accordance with paragraph (d) of Rule 144 under the Securities Act of 1933), or (ii) if it was at the date of such transfer or during the three months preceding such date of transfer an affiliate of the Issuer it will do so in compliance with any applicable state securities or "Blue Sky" laws and only (A) to the Issuer or (B) in compliance with Rule 144A, and (unless such Notes are being transferred in book-entry form as beneficial interests in one or more Class A Global Notes or Class B Global Notes, as applicable) only if a certificate in the form attached hereto as Exhibit 1.06(b)(i) with respect to the Class A Notes and as Exhibit 1.06(b)(ii) with respect to the Class B Notes is delivered by the transferee to the Indenture Trustee or (2) it should reoffer, resell, pledge or otherwise transfer Notes outside the United States to a non-U.S. person (as such term is defined in Regulation S under the Securities Act of 1933) it will do so only in a transaction complying with Rule 903 or Rule 904 of Regulation S under the Securities Act of 1933. It will give the transferee notice of any restrictions on resale of the Notes. (D) It understands that such Note will bear a legend substantially as set forth in Section 1.07. (E) It has received the information, if any, requested by it pursuant to Rule 144A, has had full opportunity to review such information and has received all additional information necessary to verify such information. (F) It (i) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its investment in the Notes, and (ii) has the ability to bear the economic risks of its prospective investment and can afford the complete loss of such investment. (G) It understands that the Issuer, the Initial Purchaser, the Indenture Trustee and others will rely upon the truth and accuracy of the foregoing acknowledgments, representations and agreements and agrees that if any of the foregoing acknowledgments, representations or agreements deemed to have been made by it are no longer accurate, it will promptly notify the Issuer and the Initial Purchaser. If it is acquiring any Notes as a fiduciary or agent for one or more investor accounts, it represents that it has sole investment discretion with respect to each such account and it has full power to make the foregoing acknowledgments, representations and agreements on behalf of such account. 7 (H) It acknowledges that it has had the opportunity to ask questions and receive answers concerning the terms and conditions of the transaction contemplated by the Indenture and to obtain additional information necessary to verify the accuracy and completeness of any information furnished to it or to which it has had access. (I) It will not sell, transfer, assign, participate, pledge, or otherwise dispose of such Note (or any interest in such Note) other than by unconditional sale of the entire right, title and interest of the purchaser or transferee in and to a principal amount of such Note not less than the minimum denomination of such Note. (J) It is acquiring such Note for its own account, for investment purposes only and not with a view to a distribution, and is the sole beneficial owner of such Note, recognizing that the disposition of its property shall at all times be and remain within its control. (b) Transfer Certificate. Notwithstanding the provisions of Section 1.06(a) and Section 1.06(b), (i), an Owner of a Class A Note is required to deliver to the Issuer, the Indenture Trustee and the Note Registrar a certificate substantially in the form of Exhibit 1.06(b)(i) hereto unless it is purchasing a Book-Entry Note or a Note from the Initial Purchaser and (ii) an Owner of a Class B Note is required to deliver to the Issuer, the Indenture Trustee and the Note Registrar a certificate substantially in the form of Exhibit 1.06(b)(ii) hereto unless it is purchasing a Book-Entry Note or a Note from the Initial Purchaser. (c) Void Transfers. If (i) any Note is issued, sold, transferred, assigned, participated, pledged or otherwise disposed of in contravention of the provisions of this Section 1.06, (ii) at any time the foregoing representations of such purchaser or transferee are not true, or (iii) the purchaser or transferee breaches the foregoing agreements, then the purchase or transfer of such Note shall be void ab initio and of no effect. Section 1.07. Legending of Notes. (a) Legending of Class A Notes. The Class A Notes shall each bear a legend in substantially the following form: THIS CLASS A NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS NOTE MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (A) OTHER THAN IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS (1) TO THE ISSUER OR ANY OF ITS AFFILIATES OR (2) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE 144A, OR PURCHASING FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER WHOM THE HOLDER HAS INFORMED, 8 IN EACH CASE, THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (B) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON ONLY IN A TRANSACTION COMPLYING WITH RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, AND IN EACH CASE UPON THE RECEIPT BY THE ISSUER OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE ISSUER THAT SUCH RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS. ADDITIONAL TRANSFER RESTRICTIONS ARE SET FORTH IN THE INDENTURE. (b) Legending of Class B Notes. The Class B Notes shall each bear a legend in substantially the following form: THIS CLASS B NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS NOTE MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (A) OTHER THAN IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS (1) TO THE ISSUER OR ANY OF ITS AFFILIATES OR (2) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE 144A, OR PURCHASING FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (B) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON ONLY IN A TRANSACTION COMPLYING WITH RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, AND IN EACH CASE UPON THE RECEIPT BY THE ISSUER OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE ISSUER THAT SUCH RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS. ADDITIONAL TRANSFER RESTRICTIONS ARE SET FORTH IN THE INDENTURE. Section 1.08. Provision of Information to Prospective Purchasers of the Notes; Rule 144A Matters. For so long as any of the Notes remain outstanding and are a "restricted security" within the meaning of Rule 144(a)(3) under the Securities Act, any Noteholder may request that the Indenture Trustee forward to the Issuer a request that the Issuer provide the information specified in, and meeting the requirements of, Rule 144A(d)(4) under the Securities Act. Upon receipt of such request, the Indenture Trustee shall forward such request promptly to the Issuer. The Issuer shall provide such requested information promptly to the Indenture Trustee, who shall forward such requested information promptly to the requesting Noteholder. Furthermore, Purchasers agree to treat and to take no action inconsistent with the treatment of the Notes, for tax and accounting purposes, as debt. Section 1.09. 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 canceled 9 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 canceled by the Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled 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 destroyed or returned to it; provided that such Issuer Order is timely and the Notes have not been previously disposed of by the Indenture Trustee. Section 1.10. 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, the initial Clearing Agency, by, 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 initial Clearing Agency, and no Note Owner of any Class of Notes will receive a Definitive Note (as defined below) representing such Note Owner's interest in such Book-Entry Note, except as provided in Section 1.12. Unless and until definitive, fully registered Notes (the "DEFINITIVE NOTES") have been issued to Note Owners pursuant to Section 1.12: (i) the provisions of this Section shall be in full force and effect; (ii) the Issuer, the Note Registrar and the Indenture Trustee may deal with the Clearing Agency for all purposes (including the payment of principal of and interest and other amounts on the Book-Entry Notes) as the sole holder of the Notes, and shall have no obligation to the Note Owners of any Class of Notes; (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 of each Class of Notes shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants pursuant to the Note Depository Agreement. Unless and until Definitive Notes are issued pursuant to Section 1.12, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit payments of principal of and interest and other amounts on the Book-Entry Notes to such Clearing Agency Participants; (v) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders of any Class of Notes evidencing a specified percentage of the Note Principal Amount of such Class of Notes, the 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 Clearing Agency Participants owning or representing, respectively, such required 10 percentage of the beneficial interest in the applicable Class of Notes and has delivered such instructions to the Indenture Trustee; and (vi) each Note Owner, by its acceptance of its interest in a Note, shall be deemed to have made the representations and to have bound itself by the agreements set forth pursuant to Section 1.06 and to have agreed to treat the Notes as indebtedness for all tax and financial reporting purposes. Section 1.11. Notices to Clearing Agency. Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes shall have been issued to Note Owners pursuant to Section 1.12, the Indenture Trustee shall give all such notices and communications specified herein to be given to Noteholders of any Class of Notes to the Clearing Agency, and shall have no obligation to the Note Owners to enforce such notices or communications. Section 1.12. Definitive Notes. If (i) the Issuer advises the Indenture Trustee in writing that the Clearing Agency is no longer willing or able to properly discharge its responsibilities with respect to the Book-Entry Notes, and the Issuer is unable to locate a qualified successor, (ii) the Issuer at its option advises the Indenture Trustee in writing that it elects to terminate the book-entry system through the Clearing Agency or (iii) after the occurrence of an Event of Default, Note Owners representing beneficial interests aggregating at least a majority of each of the Class A Note Principal Amount and Class B Note Principal Amount of the Book-Entry Notes advise the Clearing Agency (which shall then notify the Indenture Trustee and the Issuer) in writing that the continuation of a book-entry system through the Clearing Agency is no longer in the best interests of the Note Owners, then the Indenture Trustee will cause the Clearing Agency to notify all Note Owners, through the 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 the 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 the Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes, the Indenture Trustee shall recognize the holders of the Definitive Notes as Noteholders. Section 1.13. Payment of Principal and Interest; Defaulted Interest; Noteholders' Interest Basis Carryover. (a) Notes. (i) The Class A Notes shall accrue interest as provided in the form of Class A Note set forth in Exhibit 1.01(a) and such interest shall be payable on each Payment Date as specified therein, subject to Section 3.01. The Class B Notes shall accrue interest as provided in the form of Class B Note set forth in Exhibit 1.01(b), and such interest shall be payable on each Payment Date as 11 specified therein, subject to Section 3.01. The Class B Noteholders' Interest Distribution Amount will not be paid to the Class B Noteholders on the applicable Payment Date unless the Class A Noteholders' Interest Distribution Amount for such Payment Date shall first have been paid to the Class A Noteholders. Any installment of interest (and any Noteholders' Interest Basis Carryover) or principal, if any, payable on any Note which is punctually paid or duly provided for by the Issuer on the applicable Payment Date, shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered on the Record Date by wire transfer if such Person provides appropriate written instructions to the Indenture Trustee no later than such Record Date, and otherwise 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 1.12, with respect to Notes registered on the Record Date in the name of the nominee of the Clearing Agency (initially, such nominee to be Cede & Co.), payment will 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 Payment Date which shall be payable as provided below. The funds represented by any such checks returned undelivered shall be held in accordance with Section 3.02. (ii) The principal of each Class A Note shall be payable in installments on each Payment Date after the end of the Acquisition Period (plus, if applicable, a single principal payment occurring at the end of the Funding Period pursuant to Section 8.05) as provided in the form of the Class A Note set forth in Exhibit 1.01(a). The principal of each Class B Note shall be payable in installments on each Payment Date after the end of the Acquisition Period (plus, if applicable, a single principal payment occurring at the end of the Funding Period pursuant to Section 8.05) as provided in the form of the Class B Note set forth in Exhibit 1.01(b). No payments of principal with respect to the Class B Notes will be paid until the Class A Notes have been paid in full. Notwithstanding the foregoing, the entire unpaid principal amount of the Notes shall be due and payable, if not previously paid, if an Event of Default shall have occurred and if the Indenture Trustee or the Noteholders of the Notes representing not less than a majority of the Controlling Class, have declared the Notes to be immediately due and payable in the manner provided in Section 5.02. All principal payments on the Notes shall be made, first, to the Class A Notes pro rata until the Class A Note Principal Amount has been paid in full, and then to the Class B Notes pro rata until the Class B Note Principal Amount has been paid in full. 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 Payment Date on which the Issuer expects that the final installment of principal of and interest (and any Noteholders' Interest Basis Carryover) on such Note will be paid. Such notice shall be mailed or transmitted by facsimile prior to such final Payment 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 12 payment of such installment. Notices in connection with redemptions of Notes shall be mailed to Noteholders as provided in Section 9.02. (iii) If the Issuer defaults in a payment of interest on the Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted interest to the extent lawful) at the Class A Note Rate or the Class B Note Rate, as applicable, in any lawful manner. The Issuer may pay such defaulted interest to Noteholders on a subsequent special record date, which date shall be at least five Business Days prior to the payment date. The Issuer shall fix or cause to be fixed any such special record date and payment date, and, at least 15 days before any such special record date, the Issuer shall mail to the Indenture Trustee a notice which the Indenture Trustee will, as soon as practicable, distribute to each Noteholder that states the special record date, the payment date and the amount of defaulted interest to be paid. (iv) The Noteholders' Interest Basis Carryover on each Payment Date, including all unpaid carryover from prior Payment Dates for each Class of Notes for each applicable Collection Period, shall be payable on such Payment Date, solely to the extent that the funds required are available to be distributed to Class A Noteholders and Class B Noteholders by the Indenture Trustee pursuant to Section 8.04(b). (v) The Indenture Trustee shall determine LIBOR for purposes of calculating the Class A Note Rate and Class B Note Rate for each Interest Period on the second business day prior to the commencement of each LIBOR Reset Period with respect to such Interest Period (or, in the case of the first LIBOR Reset Period, on August 19, 2002 (each, a "LIBOR Determination Date"). For purposes of calculating LIBOR, a business day is any day on which banks in London, England, New York, New York, Chicago, Illinois and the Commonwealth of Massachusetts are open for the transaction of business. Interest due for any Interest Period shall be determined based on the actual number of days in such Interest Period over 360-day year. "LIBOR" means, with respect to any LIBOR Reset Period, the London interbank offered rate for deposits in U.S. dollars having a maturity of 90 days commencing on the related LIBOR Determination Date (the "Index Maturity") which appears on Telerate Page 3750 as of 11:00 a.m., London time, on such LIBOR Determination Date. If such rate, on any LIBOR Determination Date, does not appear on Telerate Page 3750, the rate for that day shall 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 such LIBOR Determination Date to prime banks in London interbank market by the Reference Banks. The Indenture Trustee shall request the principal London office of each of such Reference Banks to provide a quotation of its rate. If at least two such quotations are provided, the rate for that LIBOR Determination Date shall be the arithmetic mean of the quotations. If fewer than two quotations are provided, the rate for that day shall be the arithmetic mean of the rates quoted by three major banks in New York City, selected by the Indenture 13 Trustee, at approximately 11:00 a.m., New York City time, on such LIBOR Determination Date for loans in U.S. dollars to leading European banks having the Index Maturity and in a principal amount equal to an amount of not less than U.S. $1,000,000; provided that if the banks selected as aforesaid are not quoting as mentioned in this sentence, LIBOR in effect for the applicable LIBOR Reset Period shall be LIBOR in effect on the previous LIBOR Reset Period. "LIBOR Reset Period" means the period commencing on each Payment Date and ending on the day immediately preceding the following Payment Date; provided, however, that the initial LIBOR Reset Period for the Class A Notes and Class B Notes, as applicable, will commence on the Closing Date. "Telerate Page 3750" means the display page so designated on the Dow Jones Telerate Service (or such other page as may replace that page on that service for the purpose of displaying comparable rates or prices). "Reference Banks" means four major banks in the London interbank market selected by the Indenture Trustee. 14 Article II REPRESENTATIONS AND WARRANTIES Section 2.01. Representations and Warranties of the Issuer. The Issuer represents and warrants as follows: (a) Organization, Powers. The Issuer is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Delaware, has all necessary power as a limited partnership to carry on its present business, is duly licensed or qualified in all jurisdictions where the nature of its activities require such licensing or qualifying and where its failure to be so licensed or qualified would not have a Material Adverse Effect on the Issuer or the Notes; and has full power, right and authority to enter into this Indenture, the other Transaction Documents to which it is, or will be, a party and the transactions contemplated hereby and thereby, to issue the Notes and to perform each and all of the matters and things herein and therein provided for. The Issuer has not been known by any name other than "AMS-2 2002, LP" and has not had any office other than its office at One AMS Place, 463 Swansea Mall Drive, Swansea, Massachusetts 02777, and that office is its chief executive office and principal place of business. (b) Issuer Authority, etc. The execution, delivery and performance by the Issuer of this Indenture, the Notes and the other Transaction Documents to which it is, or will be, a party and the transactions contemplated hereby and thereby have been duly authorized by all necessary limited partnership action and this Indenture, the Notes and such Transaction Documents constitute the legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms, except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditors' rights generally and general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or law. (c) Compliance with Laws and Contracts. The execution, delivery and performance by the Issuer of this Indenture, the Notes and the other Transaction Documents to which the Issuer is a party do not and will not (i) violate, in any material respect, any provision of any law, rule, regulation, order, writ, judgment, injunction, decree, determination or award to which the Issuer or its property is subject, or of the limited partnership agreement and certificate of limited partnership of the Issuer; (ii) result in a material breach of or constitute a material default under the provisions of any indenture, loan or credit agreement or any other material agreement, lease or instrument to which the Issuer may be or is subject or by which it, or its property, is bound; or (iii) result in, or require, the creation or imposition of any Lien on or with respect of any of the material properties of the Issuer other than the Lien in favor of the Indenture Trustee provided herein; and the Issuer is not in violation of, or in default under, any such law, rule, regulation, order, writ, judgment, injunction, decree, determination or award or any such indenture, agreement, lease or instrument except for violations or defaults that singly or in the aggregate have not had nor would not have a Material Adverse Effect on the Issuer. 15 (d) Governmental Approvals. The Issuer has obtained all authorizations, consents, approvals, exemptions of or filings or registrations with all governmental commissions, regulatory bodies, boards, bureaus, agencies and instrumentalities, domestic or foreign, necessary to the conduct of its business and with respect to which the failure to obtain would not have a Material Adverse Effect on the Issuer, or necessary to the valid execution, delivery and performance by the Issuer of this Indenture, the Notes and the other Transaction Documents to which the Issuer is, or will be, a party (the "Approvals"), and such Approvals remain in full force and effect. (e) Litigation. There is no action, suit, proceeding, inquiry or investigation at law or in equity or before or by any court, public board or body pending or, to the knowledge of the Issuer, overtly threatened in writing against or affecting the Issuer wherein an unfavorable decision, ruling or finding would have a Material Adverse Effect on the Issuer or which affects, or purports to affect, the validity or enforceability against the Issuer of any Transaction Document. (f) Employee Benefit Plans. All "employee benefit plans" (as such term is defined in ERISA) of the Issuer and each of its ERISA Affiliates (as defined in ERISA) (individually, a "Plan" and collectively the "Plans") are in compliance in all material respects with any applicable provisions of ERISA and the regulations and published interpretations thereunder, except for compliance amendments which may be required due to changes in such laws and regulations and which were not addressed by the latest determination letters and for which the retroactive amendment period has not expired. No Plan is insolvent or in reorganization. No proceedings have been instituted to terminate any Plan, and no conditions exist which would permit the institution of proceedings to terminate any such Plan. (g) Perfected Interest. Each Financed Student Loan, including the related Student Loan Note, is owned by the Issuer or by the Eligible Lender Trustee, on behalf of the Issuer, free and clear of any Lien other than the Lien created hereby. Except for the filing of the financing statements being executed and filed in connection with the closing of the transaction, no further action, including any filing or recording of any document, is necessary in order to establish, protect and perfect the first priority security interest of the Indenture Trustee, for the benefit of the Noteholders, in the Collateral as against any third party in any applicable jurisdiction, including, without limitation, any purchaser from, or creditor of, the Issuer. No financing statement or other instrument similar in effect covering any of the Collateral or any interest therein is on file in any recording office except such as may be filed (i) in connection with any Lien arising solely as the result of any action taken by the Indenture Trustee, (ii) in favor of the Indenture Trustee or (iii) for which UCC termination statements have been filed or with respect to Liens which by their terms do not require that a release be filed for the security interest of the Indenture Trustee to be of first priority. (h) Accuracy of Information. All information (including each Quarterly Report, Student Loan Schedule and computer tape) supplied by, or on behalf of, the Issuer in writing to the Indenture Trustee in connection with this Indenture or the transactions contemplated hereby is true and accurate in all material respects as of the 16 date thereof stated or certified. No information, exhibit or report furnished by the Issuer to the Indenture Trustee in connection with this Indenture contained any material misstatement. (i) Defaults. No Event of Default or Unmatured Event of Default exists. (j) Margin Regulations. The use of all funds obtained by the Issuer under this Indenture will not conflict with or contravene any of Regulations G, T, U and X promulgated by the Board of Governors of the Federal Reserve System from time to time. (k) Offices. The chief place of business and chief executive office of the Issuer are located at the address of the Issuer referred to in Section 10.02, and the offices where the Issuer keeps all its books, records and documents evidencing the Financed Student Loans are located at the addresses specified in Schedule 2.01(k) (or at such other locations, notified to the Indenture Trustee in accordance with Section 10.02, in jurisdictions where all action necessary to maintain the Indenture Trustee's first priority perfected interest, for the benefit of the Noteholders, in the Collateral has been taken and completed). (l) Eligible Student Loans. Each Student Loan, as of the date of its inclusion in the Collateral, is an Eligible Student Loan. (m) [Reserved] (n) The Issuer Not an Investment Company. The Issuer is not required to register as an "investment company" within the meaning of the Investment Company Act. Section 2.02. Reassignment upon Breach. The Issuer or the Indenture Trustee, as the case may be, shall inform the other parties to this Indenture and the Noteholders promptly, in writing, upon the discovery of any breach of the representations and warranties made by the Issuer pursuant to Sections 2.01(g) or (l) or any of the covenants of the Issuer made pursuant to Section 3.07 that materially and adversely affects the interest of the Noteholders in any Financed Student Loan (any such breach that does not affect any Student Loan Guarantor's obligation to guarantee payment of such Financed Student Loan shall not be considered to have a material adverse effect). Unless any such breach which materially and adversely (subject to the preceding parenthetical) affects the interests of the Noteholders in the affected Financed Student Loan shall have been cured within 30 days (or in the sole discretion of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, 60 days) following the discovery thereof by the Issuer or receipt by the Issuer of written notice from the Indenture Trustee of such breach, the Financed Student Loan as to which such representation and warranty or covenant relates shall be released from the Collateral and reassigned to the Eligible Lender Trustee, (a "Reassignment"), as of the first Determination Date succeeding the end of such 30-day or 60-day period, respectively. In consideration of and simultaneously with the reassignment of such Financed Student Loan, the Issuer shall 17 deposit to the Collection Account on such Determination Date immediately available funds equal to the Purchase Amount. Notwithstanding the foregoing, so long as no Event of Default shall have occurred and be continuing the Issuer may, at its option in lieu of depositing such Purchase Amount to the Collection Account on such date, cause the Eligible Lender Trustee to pledge to the Indenture Trustee on such date for inclusion in the Collateral a new Eligible Student Loan in substitution for such Eligible Student Loan which was a Financed Student Loan having a Principal Balance plus accrued and unpaid interest at least equal to the Substitution Amount of the Eligible Student Loan which was a Financed Student Loan being substituted and bearing an interest rate that is the maximum allowed by law for the related student loan program, by delivering an updated Student Loan Schedule to the Indenture Trustee reflecting such substitution (a "Substitution"). The Indenture Trustee shall execute such documents reasonably requested by the Issuer in order to effect such reassignment and to release the Indenture Trustee's Lien thereunder. The sole remedy of the Indenture Trustee or the Noteholders with respect to a breach of representations and warranties pursuant to Sections 2.01(g) and (l) and the covenants contained in Section 3.07 shall be to require the Issuer to deposit the Purchase Amount or substitute Financed Student Loans as provided above. Section 2.03. Representations and Warranties of General Partner. The General Partner hereby represents and warrants as follows: (a) Organization, Corporate Powers. The General Partner is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, has all necessary corporate power to carry on its present business, is duly licensed or qualified in all jurisdictions where the nature of its activities require such licensing or qualifying and where its failure to be so licensed or qualified would not have a Material Adverse Effect on the Issuer. (b) Issuer Authority, etc. The execution, delivery and performance by the General Partner of the limited partnership agreement of the Issuer and the transactions contemplated thereby have been duly authorized by all necessary corporate action. (c) Compliance with Laws and Contracts. The execution, delivery and performance by the General Partner of its duties under the limited partnership agreement of the Issuer will not (i) violate, in any material respect, any provision of any law, rule, regulation, order, writ, judgment, injunction, decree, determination or award to which the General Partner or its property is subject, or of the certificate of incorporation or bylaws of the General Partner; (ii) result in a material breach of or constitute a material default under the provisions of any indenture, loan or credit agreement or any other material agreement, lease or instrument to which the General Partner may be or is subject or by which it, or its property, is bound; or (iii) result in, or require, the creation or imposition of any Lien on or with respect of any of the material properties of the General Partner, which in any case would have a Material Adverse Effect on the General Partner; and the General Partner is not in violation of, or in default under, any such law, rule, regulation, order, writ, judgment, injunction, decree, determination or award or any such indenture, agreement, lease or instrument except for violations or defaults that singly or in the 18 aggregate have not had nor would not have a Material Adverse Effect on the General Partner. (d) Governmental Approvals. The General Partner has obtained all authorizations, consents, approvals, exemptions of or filings or registrations with all governmental commissions, regulatory bodies, boards, bureaus, agencies and instrumentalities, domestic or foreign, necessary to the conduct of its business and with respect to which the failure to obtain would not have a Material Adverse Effect on the General Partner. (e) Litigation. There is no action, suit, proceeding, inquiry or investigation at law or in equity or before or by any court, public board or body pending or, to the knowledge of the General Partner, overtly threatened in writing against or affecting the General Partner wherein an unfavorable decision, ruling or finding would have a Material Adverse Effect on the General Partner or which affects, or purports to affect, the validity or enforceability against the General Partner of the limited partnership agreement of the Issuer. Section 2.04. Representations and Warranties of Indenture Trustee. The Indenture Trustee hereby represents and warrants as follows: (a) Due Organization. It is a national banking association duly organized and validly existing in good standing under the laws of the United States. It has all requisite corporate power and authority to execute, deliver and perform its obligations under this Indenture. (b) Authorization. It has taken all corporate action necessary to authorize the execution and delivery by it of this Indenture, and this Indenture will be executed and delivered by one of its officers who is duly authorized to execute and deliver this Indenture on its behalf. (c) Eligible Lender. It is an "eligible lender" as such term is defined in Section 435(d) of the Higher Education Act, for purposes of being pledgee of the Financed Student Loans as contemplated by this Indenture. (d) Binding Obligation. This Indenture constitutes, and each other Transaction Document to be executed by the Indenture Trustee when duly executed and delivered, will constitute, a legal, valid and binding obligation of the Indenture Trustee, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. Section 2.05. Representations and Warranties of Eligible Lender Trustee. The Eligible Lender Trustee hereby represents and warrants as follows: 19 (a) Due Organization. It is a national banking association duly organized and validly existing in good standing under the laws of the United States. It has all requisite corporate power and authority to execute and deliver this Indenture. (b) Eligible Lender. It is an "eligible lender" as such term is defined in Section 435(d) of the Higher Education Act. Article III GENERAL COVENANTS OF THE ISSUER Section 3.01. Payment to Noteholders. The Issuer will duly and punctually pay the principal of, interest, if any, on and any interest on Noteholders' Interest Basis Carryover (but only to the extent provided in Sections 1.13(a)(iv) and 8.03(b)) with respect to the Notes in accordance with the terms of the Notes and this Indenture. Without limiting the foregoing, subject to Section 8.03(b), the Issuer will cause to be paid to the Class A Noteholders on the Payment Date that portion of the amounts on deposit in the Trust Accounts which the Class A Noteholders are entitled to receive, and will cause to be paid to the Class B Noteholders on the Payment Date that portion of the amounts on deposit in the Trust Accounts which the Class B Noteholders are entitled to receive. Amounts properly withheld under the Code by any Person from a payment to any Noteholder of interest (including any Noteholders' Interest Basis Carryover) and/or principal shall be considered as having been paid by the Issuer to such Noteholder for all purposes of this Indenture. Section 3.02. Money for Payments to Be Held in Trust. All payments of amounts due and payable with respect to any Notes that are to be made from amounts distributed from the Collection Account or any other Account shall be made on behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so distributed for payments of Notes shall be paid over to the Issuer except as provided in this Section. On each Payment Date the Issuer shall allocate or cause to be allocated to the Indenture Trustee (or any other Paying Agent) an aggregate sum sufficient to pay the amounts then becoming due on the Notes, 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 will 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 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; 20 (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; (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 payment of Notes 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, 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, 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 monies 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). 21 Section 3.03. Existence. The Issuer will keep in full effect its existence, rights and franchises as a limited partnership under the laws of the State of Delaware (unless subject to the prior written consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, 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 will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) and will 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. The Issuer will maintain its status as a pass-through entity for federal income tax purposes. Section 3.04. Protection of Indenture Trust Estate. (a) The Issuer will from time to time execute or authenticate and deliver all such supplements and amendments hereto and all such financing statements, continuation or amendment statements, instruments of further assurance and other instruments, and will take such other action necessary or advisable to: (i) maintain or preserve the lien and security interest 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) collect payments due on the Financed Student Loans; or (iv) preserve and defend title to the Indenture Trust Estate and the rights of the Indenture Trustee and the Noteholders in such Indenture Trust Estate against the claims of all persons and parties. It shall be the responsibility of the Issuer to prepare such instruments. The Issuer hereby designates the Indenture Trustee its agent and attorney-in-fact to, if it fails to do so itself, execute or authenticate any financing statement, continuation or amendment statement or other instrument required to be executed, authenticated or filed pursuant to this Section. (b) Opinions as to Indenture Trust Estate. 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, any indentures supplemental hereto, and any other requisite documents, and with respect to the execution and filing of any financing statements and continuation statements, as are necessary to perfect and make effective the lien and security interest of this Indenture and reciting the details of such action, or stating that, in the opinion of such counsel, no such action is necessary to make such lien and security interest effective. 22 Section 3.05. Performance of Obligations. (a) The Issuer will not take any action and will use its best efforts not to permit any action to be taken by others (if such action is within the Issuer's control) 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, the Purchase and Contribution Agreement, the Servicing Agreement 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 Officer's Certificate of the Issuer shall be deemed to be action taken by the Issuer. Initially, the Issuer has contracted with the Servicer to assist the Issuer in performing its duties under this Indenture. (c) If the Issuer shall have knowledge of the occurrence of a Servicer Default, the Issuer shall promptly notify the Indenture Trustee and the Rating Agencies, 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 with respect to the Financed Student Loans, the Issuer shall take all reasonable steps available to it to enforce its rights under the Transaction Documents in respect of such failure and shall take all reasonable steps available to it to enforce its rights in respect of such failure at the direction of a majority of the outstanding principal amount of the Notes comprising the Controlling Class. (d) Upon any termination of the Servicer's rights and powers pursuant to the Servicing Agreement, the Issuer shall promptly notify the Indenture Trustee. As soon as a successor Servicer is appointed with the consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, the Issuer shall notify the Indenture Trustee of such appointment, specifying in such notice the name and address of such successor Servicer. (e) 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 and a majority of the outstanding principal amount of the Notes comprising the Controlling Class, 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 Transaction Documents, except to the extent otherwise provided in the Servicing Agreement, or waive timely performance or observance by the Servicer, AMS, the Issuer or the Eligible Lender Trustee under a material provision of the Purchase and Contribution Agreement, or the Servicing Agreement; 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, (ii) reduce the aforesaid 23 percentage of the Notes which are required to consent to any such amendment, without the consent of the Noteholders of all the Outstanding Notes, or (iii) result in a deemed exchange of Notes for new notes under Section 1001 of the Code. If any such amendment, modification, supplement or waiver shall be so consented to, the Issuer 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. (f) The Issuer shall maintain and implement administrative and operating procedures (including, without limitation, an ability to recreate records identifying and evidencing the Financed Student Loans in the event of the destruction of the originals thereof), and keep and maintain, or cause to be kept and maintained, all documents, books, records and other information reasonably necessary or advisable for the collection of all the Financed Student Loans (including, without limitation, records adequate to permit the daily identification of each new Financed Student Loan included in the Collateral from time to time and all Collections of and adjustments to each existing Financed Student Loan). (g) At its expense, the Issuer shall timely and fully perform and comply, and cause the Eligible Lender Trustee to perform and comply, with all material provisions, covenants and other promises required to be observed by each of them under the Higher Education Act, Student Loan Notes, the Student Loan Guaranty Agreements, the Servicing Agreement and other agreements to which the Issuer is a party related to the Collateral. (h) The Issuer shall administer, operate and maintain, or cause the Eligible Lender Trustee to administer, operate and maintain, its student loan program in such manner as to ensure that such program and the Financed Student Loans will benefit, to the extent applicable and in all material respects, from (i) the Student Loan Guaranty Agreements, and (ii) the Federal Family Education Loan Program authorized under the Higher Education Act and the federal program of reimbursement for Student Loans pursuant to the Higher Education Act, or from any other federal statute providing for such Federal Family Education Loan Program. (i) The Issuer shall (i) maintain, and, where applicable, cause the Eligible Lender Trustee to maintain, in effect all Student Loan Guaranty Agreements and the Servicing Agreement, diligently and promptly enforce its rights thereunder and take, or use commercially reasonable steps to cause the Servicer to take, all reasonable steps, actions and proceedings necessary or appropriate for the enforcement of all material terms, covenants and conditions of each Financed Student Loan, including the prompt payment of all principal and interest payments and all other amounts due with respect to such Financed Student Loan, including all Subsidy Payments, and all Student Loan Guaranty Payments under the applicable Student Loan Guaranty Agreement, except for such deferments and forbearance permitted under the Higher Education Act, and (ii) enter and, where applicable, cause the Eligible Lender Trustee to enter, into Student Loan 24 Guaranty Agreements and the Servicing Agreement so that all Financed Student Loans are covered thereby. Section 3.06. Reporting Requirements of the Issuer. From the date hereof until the Final Scheduled Payment Date, the Issuer shall furnish to the Eligible Lender Trustee and the Indenture Trustee: (a) Quarterly Financial Statements. As soon as available and in any event within 60 days after the end of each of the first three quarters of each fiscal year of the Issuer, the Issuer's consolidated statement of income and statement of changes in cash flow for such quarter and balance sheet as of the end of such quarter presented fairly in accordance with generally accepted accounting principles; (b) Annual Financial Statements. As soon as available and in any event within 120 days after the end of each fiscal year of the Issuer, the Issuer's statement of income and statement of changes in cash flow for such year and balance sheet as of the end of such year in each case presented fairly in accordance with generally accepted accounting principles; (c) Quarterly Officer's Certificate. Within 30 days after the last day of each calendar quarter, an officer's certificate executed by the chief financial officer or treasurer of the General Partner, certifying that, as of such calendar month, (i) the Issuer is in compliance with all of the terms, conditions and requirements of the Transaction Documents, and (ii) no Event of Default or Unmatured Event of Default under this Indenture or other event of default as described in any other Transaction Documents exists; (d) Quarterly Report. No later than the tenth Business Day of each January, April, July and October, a Quarterly Report for the immediately preceding quarter, substantially in the form of Exhibit 3.06(d); (e) DOE Audit Materials. Within 30 days after the last day of each calendar month, notice of all DOE audits of or any other actions of a material nature by the DOE with respect to, the Issuer or any Affiliate thereof, to the extent that it has knowledge thereof, of the Servicer or Student Loan Guarantor, under any Student Loan Guaranty Agreement, and, in each case, notice of the results thereof (including, but not limited to, the rate of reimbursement by the DOE for the Student Loan Guarantors under the related Student Loan Guaranty Agreements, to the extent that such rate is below the maximum permitted under the Higher Education Act (i.e., 95% for Student Loans disbursed on or after October 1, 1998, 98% with respect to Student Loans disbursed on or after October 1, 1993, and 100% for Student Loans disbursed prior thereto)); (f) Reports of Independent Accountants. As promptly as practicable, copies of any reports or written comments (including, without limitation, audit reports, management letters and any other reports or communications with respect to the internal control structure) relating to the Issuer submitted by its independent accountants; 25 (g) Event of Defaults. Immediately upon becoming aware of the existence of any Event of Default or Unmatured Event of Default, a written statement of an Authorized Officer of the Issuer setting forth details of such event and the action that the Issuer proposes to take with respect thereto; and immediately upon becoming aware of a Servicer Default, written notice thereof; In addition, the Issuer shall promptly furnish a copy of each Quarterly Report upon delivery thereof to the Indenture Trustee and the Eligible Lender Trustee, to (i) Moody's at Moody's Investors Service, Inc., 99 Church Street, New York, New York 10007, Attention: ABS Monitoring Department, (ii) Fitch, Inc. at Fitch, Inc., One State Street Plaza, New York, New York 10004, Attention: Asset Backed Monitoring Unit and (iii) S&P at Standard and Poors, a division of The McGraw Hill Companies, Inc., 55 Water Street, New York, New York 10041, ABS Surveillance Department. The Issuer shall also inform each Rating Agency in writing at the above addresses immediately upon the occurrence of any resignation, substitution or replacement of the Eligible Lender Trustee, the Servicer or any Subservicer. In addition, at any time at which the Issuer provides the Indenture Trustee with notice of the occurrence of any other event pursuant to the terms of this Indenture, it shall concurrently provide such notice to each Rating Agency. Section 3.07. Servicing Covenants. From the date hereof until the Final Scheduled Payment Date, the Issuer shall comply with the following covenants. (a) Servicing. The Issuer shall cause the Servicer to service, administer and make collections with respect to the Financed Student Loans in accordance in all material respects with all applicable Federal and State laws, including all applicable standards, guidelines and requirements of the Higher Education Act and any Student Loan Guaranty Agreement, the failure to comply with which would adversely affect the eligibility of one or more of the Financed Student Loans for Subsidy Payments or Student Loan Guaranty Payments, as applicable, or would have a Material Adverse Effect on the Issuer. (b) Collection of Financed Student Loan Payments. The Issuer shall cause the Servicer to make reasonable efforts (including all efforts that may be specified under the Higher Education Act or any Student Loan Guaranty Agreement), in each case in accordance with the terms of the Servicing Agreement, to collect all payments called for under the terms and provisions of the Financed Student Loans as and when the same shall become due. (c) Collection of Student Loan Guaranty Payments. The Issuer (i) shall (or shall cause the Servicer to) make reasonable efforts to claim, pursue and collect all Student Loan Guaranty Payments from the Student Loan Guarantors pursuant to the Student Loan Guaranty Agreements with respect to any of the Student Loans that are Financed Student Loans as and when the same shall become due and payable, and (ii) comply, and shall cause the Servicer to comply, in all material respects with all applicable laws and agreements with respect to claiming, pursuing and collecting such payments in each case in accordance with the terms of the Servicing Agreement. In 26 connection therewith, the Servicer is hereby authorized and empowered to convey to any Student Loan Guarantor the Student Loan Note and the related Financed Student Loan file representing any Financed Student Loan in connection with submitting a claim to such Student Loan Guarantor for a Student Loan Guaranty Payment in accordance with the terms of the applicable Student Loan Guaranty Agreement whereupon the Lien of the Indenture Trustee relating to such Financed Student Loan shall be released without any further action of any kind. (d) Collection of Subsidy Payments. The Issuer shall make or cause to be made reasonable efforts to claim, pursue and collect all Subsidy Payments from the DOE with respect to any of the Financed Student Loans as and when the same shall become due and payable, shall comply or undertake commercially reasonable efforts to cause compliance with in all material respects with all applicable laws and agreements with respect to claiming, pursuing and collecting such payments. All amounts so collected by the Issuer or otherwise shall constitute Collections for the applicable Collection Period and shall be deposited into the Collection Account in accordance with Section 8.03(a). In connection therewith, the Issuer, shall prepare and file or cause there to be prepared with the DOE on a timely basis all claims, forms and other documents and filings necessary or appropriate in connection with the claiming of Subsidy Payments and otherwise pursuing and collecting such Subsidy Payments from the DOE. (e) Realization upon Financed Student Loans. The Issuer shall cause the Servicer to use reasonable efforts consistent with customary servicing practices and procedures and subject to the Servicing Agreement, including all efforts that may be specified under any applicable Student Loan Guaranty Agreement and the Higher Education Act, in its servicing of any delinquent Financed Student Loans. Section 3.08. Negative Covenants of the Issuer. The Issuer shall not: (a) except as expressly permitted by this Indenture or any other Transaction Document and except for properties and assets released from the Indenture Trust Estate in accordance with this Indenture, 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 (which direction the Indenture Trustee shall not give without the prior written consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class); (b) claim any credit on, or make any deduction from the principal or interest (including any Noteholders' Interest Basis Carryover or interest thereon) 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; or (c) (i) 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 27 respect to the Notes under this Indenture except as may be expressly permitted hereby, (ii) 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, in each case arising solely as a result of an action or omission of the related Obligor, and other than as expressly permitted by the Transaction Documents) or (iii) 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. Section 3.09. 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, interest on and any Noteholders' Interest Basis Carryover, if any, with respect to 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; (ii) immediately after giving effect to such transaction, no Event of Default shall have occurred and be continuing; (iii) the consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class shall have been obtained 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 tax consequence to the Issuer or any Noteholder; (v) any action as is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate of the Issuer 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. (b) The Issuer shall not convey or transfer all or substantially all its properties or assets, including those included in the Indenture Trust Estate, to any Person, unless: 28 (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 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, interest on and Noteholders' Interest Basis Carryover, if any, with respect to 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, (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 or Event of Default shall have occurred and be continuing; (iii) the consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class shall have been obtained 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 tax consequence to the Issuer or any Noteholder; (v) any action as is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate of the Issuer 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. Section 3.10. Successor or Transferee. (a) Upon any consolidation or merger of the Issuer in accordance with Section 3.09(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. 29 (b) Upon a conveyance or transfer of all the assets and properties of the Issuer pursuant to Section 3.09(b), AMS-2 2002, LP 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 AMS-2 2002, LP is to be so released. Section 3.11. No Other Business. Except as contemplated by this Indenture, its limited partnership agreement or the other Transaction Documents, the Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the Financed Student Loans in the manner contemplated by this Indenture, its limited partnership agreement and the other Transaction Documents and activities incidental thereto. Section 3.12. No Borrowing. Unless a majority of the outstanding principal amount of the Notes comprising the Controlling Class shall have given consent with respect to such issuance, the Issuer shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness except for the Notes. Section 3.13. Guarantees, Loans, Advances and Other Liabilities. Except as contemplated by the Transaction Documents or this Indenture, 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 3.14. [RESERVED]. Section 3.15. The Funding Account. Neither the Issuer, nor the Eligible Lender Trustee on behalf of the Issuer, shall acquire any Student Loans with proceeds from amounts on deposit in the Funding Account which, as of the date of acquisition of such Student Loans would in the aggregate differ materially in terms of loan type, interest rate and the delinquency rate from the Initial Financed Student Loans. Article IV SATISFACTION AND DISCHARGE Section 4.01. 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 (including any Noteholders' Interest Basis Carryover) thereon, (iv) Sections 3.02 and 6.14, (v) the rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under Sections 6.02 and 6.12 and the obligations of the 30 Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes, when: (A) either (1) all Notes theretofore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and that have been replaced or paid as provided in Section 1.04 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 3.02) 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 the Final Scheduled Payment 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, as certified by an independent certified public accountant, to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture Trustee for cancellation as of such day of discharge or when due on the Final Scheduled Payment 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 Officer's Certificate of the Issuer stating that all conditions precedent 31 herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. Section 4.02. Application of Trust Money. All monies deposited with the Indenture Trustee pursuant to Section 4.01 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 for the payment or redemption of which such monies have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest (including any Noteholders' Interest Basis Carryover), but such monies need not be segregated from other funds except to the extent required herein or in the Servicing Agreement or required by law. Section 4.03. Repayment of Monies Held by Paying Agent. In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all monies 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 3.02 and thereupon such Paying Agent shall be released from all further liability with respect to such monies. Article V REMEDIES Section 5.01. 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): (a) default for two days or more in the payment by the Issuer of any interest (provided, however, that any Noteholders' Interest Basis Carryover shall not constitute interest for this purpose) on any Note after the same becomes due and payable (provided, further, that no default in the payment of interest under this clause (a) with respect to the Class B Notes will constitute an Event of Default so long as any Class A Notes are Outstanding); or (b) default in the payment by the Issuer of the remaining principal balance of any Note when the same becomes due and payable on the Final Scheduled Payment Date; or (c) default not otherwise constituting an Event of Default under either clause (a) or (b) above for three Business Days or more in the payment of interest or any installment of the principal of any Note when the same becomes due and payable and when Available Funds are sufficient to make such payment; or (d) default in any material respect in the observance or performance of any covenant or agreement of the Issuer made in this Indenture and the continuation of any 32 such default for a period of 30 days after notice thereof is given to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the holders of at least 25% in principal amount of the Notes then outstanding; provided, however, that if the Issuer demonstrates that it is making a good-faith attempt to cure such default, such 30 day period may be extended by the Indenture Trustee (with the prior consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class) to 90 days; or (e) any representation or warranty made by the Issuer in this Indenture or in any certificate delivered pursuant hereto or in connection herewith having been incorrect in a material adverse respect as of the time made, and such breach not having been cured within 45 days after notice thereof is given to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the holders of at least 25% in principal amount of the Notes then outstanding; provided, however, that if the Issuer demonstrates that it is making a good-faith attempt to cure such breach, such 45 day period may be extended by the Indenture Trustee (with the prior consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class) to 90 days; or (f) 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 (g) the commencement by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Indenture Trust Estate, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of action by the Issuer in furtherance of any of the foregoing. Section 5.02. Acceleration of Maturity; Rescission and Annulment. If an Event of Default should occur, then the Indenture Trustee may, with the consent of, or shall, at the direction of, a majority of the outstanding principal amount of the Notes comprising the Controlling Class, declare all the Notes to be immediately due and payable, by a notice in writing to the Issuer, 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. The Indenture Trustee shall provide each Rating Agency with written notice of any acceleration of maturity of the Notes. 33 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 provided in this Article V, the Noteholders representing a majority of the Class A Note Principal Amount and the Class B Note Principal Amount may rescind and annul such declaration and its consequences if: (a) the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay: (i) 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 (ii) all sums paid or advanced by the Indenture Trustee hereunder under the Transaction Documents and the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel; and (b) 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 5.03. Collection of Indebtedness and Suits for Enforcement by Indenture Trustee. (a) The Issuer covenants that if (i) default is made in the payment of any interest (including, subject to the limitations of Sections 1.13(a)(iv) and 8.03(b), any Noteholders' Interest Basis Carryover or interest thereon) on any Note when the same becomes due and payable, and such default continues for a period of two days, or (ii) default is made in the payment of the remaining principal balance of any Notes when the same becomes due and payable on the Final Scheduled Payment Date, or (iii) default for three Business Days or more is made in the payment of interest or any installment of the principal of any Note when the same becomes due and payable and when Available Funds are sufficient to make such payment, 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 (and any Noteholders' Interest Basis Carryover), 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 (and any Noteholders' Interest Basis Carryover together with interest thereon), at the rate specified in Section 1.13 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 respective agents and counsel. 34 (b) 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 (and with the prior written consent of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, shall) institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against the Issuer or other obligor upon such Notes and collect in the manner provided by law out of the property of the Issuer or other obligor upon such Notes, wherever situated, the monies adjudged or decreed to be payable, in each case subject to Section 10.06 hereof. (c) If an Event of Default occurs and is continuing, the Indenture Trustee may, in its discretion, proceed to protect and enforce its rights and the rights of the Noteholders 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, in each case subject to Section 10.06 hereof. (d) 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 Proceeding 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, and shall, at the written direction of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, act, by intervention in such proceedings or otherwise: (i) to file and prove a claim or claims for the whole amount of principal and interest (including any Noteholders' Interest Basis Carryover and interest thereon) 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, willful misconduct or bad faith) and of the Noteholders allowed in such Proceeding; 35 (ii) unless prohibited by applicable law and regulations, to vote on behalf of the Noteholders in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceeding; (iii) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders 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 or the Noteholders allowed in any judicial Proceeding relative to the Issuer, its creditors and its property; and any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is hereby authorized by each of such Noteholders 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, 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, willful misconduct or bad faith. (e) 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. (f) 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 Proceeding relative thereto, and any such action or Proceeding 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 benefit of the Noteholders. (g) In any Proceeding brought by the Indenture Trustee (and also any Proceeding involving the interpretation of any provision of this Indenture to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all the Noteholders, and it shall not be necessary to make any Noteholder a party to any such Proceeding. 36 Section 5.04. Remedies; Priorities. (a) If an Event of Default shall have occurred and be continuing and the Notes have become due and payable, the Indenture Trustee may, and shall, at the direction of a majority of the outstanding principal amount of the Notes comprising the Controlling Class, do one or more of the following (subject to Section 5.05): (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 monies adjudged due; (ii) institute Proceedings from time to time for the complete or partial foreclosure of this Indenture with respect to the Indenture Trust Estate; (iii) exercise any remedies of a secured party under the UCC and take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee and the Noteholders; and (iv) sell the Indenture Trust Estate or any portion thereof or rights or interests therein, at one or more public or private sales called and conducted in any manner permitted by law; 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 5.01(i) or (ii), unless (A) the Noteholders of 100% of the Class A Note Principal Amount and the Class B Note Principal Amount consent, (B) the proceeds of such sale or liquidation distributable to the Noteholders are sufficient to discharge in full all amounts then due and unpaid upon such 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 Notes as they would have become due if the Notes had not been declared due and payable, and the Indenture Trustee obtains the consent of 66-2/3% of the outstanding principal amount of the Notes comprising the Controlling Class. In determining such sufficiency or insufficiency with respect to clauses (B) and (C), 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. (b) If the Indenture Trustee collects any money or property pursuant to this Article V, it shall pay out the money or property in the following order: FIRST: on a pari passu basis (based on the ratio of each such amount to the total of such amounts), to the Indenture Trustee for all due and unpaid Indenture Trustee Fees and to the Eligible Lender Trustee for all due and unpaid Eligible Lender Trustee Fees.; 37 SECOND: to the Servicer for all due and unpaid Servicing Fee Amounts due to the Servicer under the Servicing Agreement; THIRD: (i) to the Class A Noteholders for amounts due and unpaid on the Class A Notes for interest (other than any Noteholders' Interest Basis Carryover) ratably as between Noteholders within such Class, without preference or priority of any kind and (ii) to a Swap Counterparty, all net amounts, if any, due and owing a Swap Counterparty (other than any termination payments under the related Swap Agreement) (such amounts to be deposited or paid, as the case may be, under (i) and (ii) of this clause third pari passu); FOURTH: to the Class B Noteholders for amounts due and unpaid on the Class B Notes for interest (other than any Noteholders' Interest Basis Carryover) ratably as between Noteholders within such Class, without preference or priority of any kind; FIFTH: to the Class A Noteholders for amounts due and unpaid on the Class A Notes for principal ratably as between Noteholders within such Class, without preference or priority of any kind until the Class A Note Principal Amount has been paid in full; SIXTH: to the Class B Noteholders for amounts due and unpaid on the Class B Notes for principal ratably as between Noteholders within such Class, without preference or priority of any kind until the Class B Note Principal Amount has been paid in full; SEVENTH: to the Class A Noteholders for any unpaid Class A Noteholders' Interest Basis Carryover ratably as between Noteholders within such Class, without preference or priority of any kind; EIGHTH: to the Class B Noteholders for any unpaid Class B Noteholders' Interest Basis Carryover ratably as between Noteholders within such Class, without preference or priority of any kind; NINTH: to a Swap Counterparty an amount equal to any amounts due and owing to a Swap Counterparty (other than amounts paid in accordance with clause third above); TENTH: to the Servicer for all amounts due to it under the Servicing Agreement and not paid to it pursuant to priority SECOND above; ELEVENTH: to the Persons entitled thereto, any amounts due under Section 10.05; and TWELFTH: to the Issuer, free and clear of the lien of this Indenture. 38 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 Issuer shall mail to each Noteholder and the Indenture Trustee a notice that states the record date, the payment date and the amount to be paid. Section 5.05. Optional Preservation of the Indenture Trust Estate. If the Notes have been declared to be due and payable under Section 5.02 following an Event of Default and such declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may 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 (including any Noteholders' Interest Basis Carryover) on the Notes, and the Indenture Trustee shall take such desire into account when determining whether 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 (which shall be obtained at the expense of the Issuer) 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 5.06. 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 principal amount of the Notes comprising the Controlling Class 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; (v) no direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Noteholders of a majority of the outstanding principal amount of the Notes comprising the Controlling Class; and 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. 39 Section 5.07. Unconditional Rights of Noteholders to Receive Principal and Interest. Notwithstanding any other provisions in this Indenture, any Noteholder shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on such Note on or after the respective due dates thereof expressed in such Note or in this Indenture (or, in the case of redemption, on the applicable Payment Date for redemption) 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 5.08. 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 5.09. Rights and Remedies Cumulative. No right or remedy herein conferred upon or reserved to the Indenture Trustee 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 or any Noteholder to exercise any right or remedy accruing upon any Default or Event of Default shall impair any such right or remedy or constitute a waiver of any such Default or Event of Default or an acquiescence therein. Every right and remedy given by this Article V or by law to the Indenture Trustee or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee or the Noteholders, as the case may be. Section 5.11. Control by Noteholders. The Noteholders of a majority of the outstanding principal amount of the Notes comprising the Controlling Class 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, however, 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 5.04, any direction to the Indenture Trustee to sell or liquidate the Indenture Trust Estate shall be by the Noteholders of 100% of the outstanding principal amount of the Notes comprising the Controlling Class; 40 (iii) if the conditions set forth in Section 5.05 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 principal amount of the Notes comprising the Controlling Class to sell or liquidate the Indenture Trust Estate shall be of no force and effect; and (iv) the Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not inconsistent with such direction; and provided, further, that, subject to Section 6.01, 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 5.02, the Noteholders of not less than a majority of the outstanding principal amount of the Notes comprising the Controlling Class may waive any past Event of Default and its consequences except an Event of Default (a) in payment when due of principal of or interest (including, subject to the limitations of Sections 1.13(a)(iv) and 8.03(b), any Noteholders' Interest Basis Carryover) 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; provided, however, that all Class A Noteholders and Class B Noteholders may waive events described in clauses (a) and (b) hereof. 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 Event of Default or impair any right consequent thereto. Upon any such waiver, such Event of Default shall cease to exist and be deemed to have been cured and not to have occurred for every purpose of this Indenture to the extent specified in such waiver but no such waiver shall extend to any subsequent Event of 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 Note Principal Amount or (c) any suit instituted by any Noteholder for the enforcement of the payment of principal of or interest (including any Noteholders' Interest Basis Carryover) on any Note on or after the respective due dates expressed in such Note and in 41 this Indenture (or, in the case of redemption, on or after the applicable Payment Date for redemption). Section 5.14. Waiver of Stay or Extension Laws. The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any manner whatsoever, claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. Section 5.15. Action on Notes. The Indenture Trustee's right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Indenture Trust Estate or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.04(b). Section 5.16. Performance and Enforcement of Certain Obligations. (a) Promptly following a request from the Indenture Trustee to do so, the Issuer shall take all such lawful action as the Indenture Trustee may request to compel or secure the performance and observance by AMS or the Servicer, as applicable, of each of their obligations to the Issuer under or in connection with the Purchase and Contribution Agreement, the Servicing Agreement and the other Transaction Documents and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under or in connection with the Purchase and Contribution Agreement, the Servicing Agreement and the other Transaction Documents to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default on the part of the Servicer thereunder and the institution of legal or administrative actions or proceedings to compel or secure performance by AMS or the Servicer of each of their obligations under the Purchase and Contribution Agreement, the Servicing Agreement or the other Transaction Documents. (b) The Indenture Trustee, with the written consent of 66-2/3% of the outstanding principal amount of the Notes comprising the Controlling Class, shall exercise all rights, remedies, powers, privileges and claims of the Issuer against AMS and the Servicer under or in connection with the Purchase and Contribution Agreement, the Servicing Agreement or the other Transaction Documents, including the right or power to take any action to compel or secure performance or observance by AMS or the Servicer of each of their obligations to the Issuer thereunder and to give any consent, request, notice, direction, approval, extension or waiver under the Purchase and Contribution 42 Agreement, the Servicing Agreement or the other Transaction Documents and any right of the Issuer to take such action shall be suspended. 43 Article VI INDENTURE TRUSTEE Section 6.01. Acceptance of the Trusts. The Indenture Trustee accepts and agrees to execute the trusts granted to it by this Indenture, but only upon the terms and conditions set forth herein. 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. In case an Event of Default has occurred of which the Indenture Trustee has, or is deemed to have, notice in accordance with this Indenture and has not been cured, the Indenture Trustee agrees to act in accordance with the instructions and orders of the Noteholders as set forth in the applicable provisions of this Indenture, but in any such event, only upon and subject to the following expressed terms and conditions: (a) The Indenture Trustee may execute any of the trusts or powers hereof and perform any of its duties by or through attorneys, agents, receivers, employees or co-trustees and shall not be answerable for the conduct of the same if appointed in accordance with the standard specified above, and shall be entitled to an Opinion of Counsel or advice of counsel concerning all matters of trusts hereof and the duties hereunder, and may in all cases pay such reasonable compensation to all such attorneys, agents, receivers, and employees as may reasonably be employed in connection with the trusts hereof. The Indenture Trustee may act upon an Opinion of Counsel or the opinion or advice of an attorney or accountant rendered by it in the exercise of reasonable care. The Indenture Trustee shall not be responsible for any loss or damage resulting from any action or nonaction of such Person which is in good faith and in reliance upon such opinion or advice. The Indenture Trustee shall not be responsible for any action or inaction of the Servicer or any party hereto except as provided herein or under applicable laws, rules and regulations. (b) The Indenture Trustee shall not be responsible for any recital herein, or in any Note, or for the validity of the execution by the Issuer or the other parties of this Indenture or the other Transaction Documents, or of any supplemental indentures or instruments of further assurance, or for the sufficiency of the security for the Notes issued hereunder or intended to be secured hereby, or for the value or title of the property herein conveyed or otherwise as to the maintenance of the security hereof. (c) The Indenture Trustee shall not be accountable for the use or application by the Issuer of the Notes or the proceeds thereof or for the use or application of any money paid over by the Indenture Trustee in accordance with the provisions of this Indenture or for the use and application of other money received by the Indenture Trustee. (d) The Indenture Trustee shall be protected in acting upon any notice, requisition, request, consent, certificate, order, opinion, affidavit, letter, telegram or other paper or document reasonably believed to be genuine and correct and to have been signed 44 or sent by the proper Person or Persons. Any action taken by the Indenture Trustee pursuant to this Indenture upon the request or authority or consent of any Person who at the time of making such request or giving such authority or consent is the owner of a Note shall be conclusive and binding upon all future owners of the Notes and upon any Notes issued in exchange therefor or in place thereof. (e) Except as otherwise expressly provided in this Indenture, as to the existence or nonexistence of any fact or as to the sufficiency or validity of any instrument, paper or proceeding, the Indenture Trustee shall be entitled to rely upon a certificate of an officer of any Noteholder as sufficient evidence of facts therein contained, and prior to the occurrence of a default of which the Indenture Trustee has been notified as provided in subsection (g) of this Section, or of which by said subsection it is deemed to have notice, shall also be at liberty to accept a dealing, transaction or action as necessary or expedient, but may at its discretion secure such further evidence deemed necessary or advisable, but shall in no case be bound to secure the same. (f) The permissive right of the Indenture Trustee to do things enumerated in this Indenture shall not be construed as a duty and the Indenture Trustee shall not be answerable for other than its negligence or willful misconduct; provided, however, that the Indenture Trustee shall not be liable for any error of judgment made in good faith, unless it shall be proved that such Person was negligent in ascertaining the pertinent facts. (g) The Indenture Trustee shall not be required to take notice or be deemed to have notice of any default hereunder except failure by the Issuer to cause to be made any of the payments to it for the account of the Noteholders required to be made by Section 3.01, or defaults under Section 5.01, unless the Indenture Trustee shall be specifically notified in writing of such default by the Issuer or a Noteholder. (h) The Indenture Trustee shall not be required to give any bond or surety in respect of the execution of the said trusts and powers or otherwise in respect of the premises. (i) No provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur any 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 for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (j) All moneys received by the Indenture Trustee shall, until used or applied or invested as herein provided, be held in trust for the purposes for which they were received in the Collection Account, Reserve Account, Capitalized Interest Account, Funding Account and Acquisition Account. (k) Whether or not herein expressly so provided, 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. 45 (l) NOTWITHSTANDING ANY OTHER PROVISION OF THIS INDENTURE OR THE OTHER TRANSACTION DOCUMENTS, NOTHING IN THIS INDENTURE OR THE OTHER TRANSACTION DOCUMENTS SHALL BE CONSTRUED TO LIMIT THE LEGAL RESPONSIBILITY OF THE INDENTURE TRUSTEE TO THE SECRETARY OF EDUCATION OR A FEDERAL GUARANTOR FOR ANY VIOLATIONS OF STATUTORY OR REGULATORY REQUIREMENTS THAT MAY OCCUR WITH RESPECT TO STUDENT LOANS HELD BY THE INDENTURE TRUSTEE PURSUANT TO, OR TO OTHERWISE COMPLY WITH ITS OBLIGATIONS UNDER, THE HIGHER EDUCATION ACT OR IMPLEMENTING REGULATIONS. Section 6.02. Fees, Charges and Expenses of Indenture Trustee. The Indenture Trustee shall be entitled (i) to payment of the Indenture Trustee's Fees for its services rendered hereunder pursuant to the priorities set forth in Section 8.03(b) and (ii) to payment by the Issuer of, or reimbursement for, all advances, reasonable counsel fees and expenses and other out-of-pocket expenses reasonably and necessarily made or incurred by the Indenture Trustee, in connection with such services, which shall be paid to it. Section 6.03. Notice if Default Occurs. If a default occurs of which the Indenture Trustee is by Section 6.01(g) required to take notice or if notice of default be given as provided in said Section 6.01(g), then the Indenture Trustee shall give written notice thereof by registered or certified mail to the Issuer and the Noteholders. Section 6.04. Intervention by Indenture Trustee. In any judicial proceeding to which the Issuer is a party, the Indenture Trustee shall intervene if directed to do so in writing by a majority of the outstanding principal amount of the Notes comprising the Controlling Class. Section 6.05. Successors. Any corporation or association into which the Indenture Trustee may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer its corporate trust business and assets as a whole or substantially as a whole, or any corporation or association resulting from any such conversion, sale, merger, consolidation or transfer to which it is a party, ipso facto, shall be and become successor Indenture Trustee hereunder and vested with all of the title to the whole property or trust estate and all the trusts, powers, discretions, immunities, privileges and all other matters as was its predecessor, without the execution or filing of any instrument or any further act, deed or conveyance on the part of any of the parties hereto, anything herein to the contrary notwithstanding. Section 6.06. Resignation. The Indenture Trustee may at any time resign from the trusts hereby created by giving 90 days' written notice to the Issuer and the Noteholders, and such resignation shall take effect at the end of such 90 days, or upon the earlier appointment and acceptance of a successor Indenture Trustee, as provided in Section 6.08 hereof, or removal as provided in Section 6.07 hereof. Notwithstanding the foregoing, resignation of the Indenture Trustee shall not be effective until a successor or temporary Indenture Trustee is appointed and has accepted such appointment; provided, however, if an instrument of acceptance shall not have been delivered within 120 days 46 after giving such notice of resignation, the resigning Indenture Trustee may petition a court of competent jurisdiction for the appointment of a successor, and any attorneys' fees and expenses incurred in connection with such petition shall be payable by the Issuer. Section 6.07. Removal. The Indenture Trustee may be removed a majority of the outstanding principal amount of the Notes comprising the Controlling Class at any time by an instrument in writing delivered to the Indenture Trustee. The Issuer shall remove the Indenture Trustee if (i) the Indenture Trustee fails to comply with Section 6.13, (ii) an Event of Bankruptcy 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. Notwithstanding the foregoing, removal of the Indenture Trustee shall not be effective until a successor is appointed and has accepted such appointment. Section 6.08. Appointment of Successor. In case the Indenture Trustee shall resign or be removed, or be dissolved, or shall be in course of dissolution or liquidation, or otherwise become incapable of acting hereunder, or in case it shall be taken under the control of any public officer or officers, or of a receiver appointed by a court, a successor meeting the eligibility requirements of Section 6.13 may be appointed by the Issuer by an instrument in writing signed by the Issuer. The Issuer shall also inform the Rating Agencies promptly of any such resignation or removal of the Indenture Trustee. If no appointment of a successor Indenture Trustee shall have been made pursuant to the foregoing provisions of this Section within 120 days after the Indenture Trustee shall have given written notice as provided in Section 6.06 hereof, the Indenture Trustee, the Issuer or a majority of the outstanding principal amount of the Notes comprising the Controlling Class may apply to a court of competent jurisdiction to appoint a successor Indenture Trustee. Each such successor Indenture Trustee shall agree in writing to be bound by the provisions of Section 10.06. Section 6.09. Concerning Any Successor. Every successor Indenture Trustee appointed hereunder shall execute, acknowledge and deliver to its predecessor and also to the Issuer an instrument in writing accepting such appointment hereunder, and thereupon such successor, without any further act, deed or conveyance, shall become fully vested with all the estates, properties, rights, powers, trusts, duties and obligations of its predecessor; but such predecessor shall, nevertheless, upon receipt of a request from the Issuer execute and deliver an instrument transferring to such successor all the estates, properties, rights, powers and trusts of such predecessor hereunder; and every predecessor shall deliver all securities and moneys held by it as Indenture Trustee hereunder to its successor. Section 6.10. Appointment of Co-Trustee. It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as the Indenture Trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture or any other Transaction Document or any Student Loan or related agreement, and in particular in case of the enforcement thereof on default, or in case of a conflict of interest, or in case 47 the Indenture Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to the Indenture Trustee or hold title to the properties, in trust, as herein granted, or take any other action which may be desirable or necessary in connection therewith, it may be necessary that the Indenture Trustee appoint an additional institution, which must be a commercial bank with trust powers, as a separate or co-Trustee. The following provisions of this Section are intended to accomplish these ends. In the event that the Indenture Trustee appoints an additional individual or institution as a separate or co-Trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Indenture Trustee with respect thereto shall be exercisable by and vest in such separate or co-Trustee but only to the extent necessary to enable such separate or co-Trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate or co-Trustee shall run to and be enforceable by either of them. Should any instrument in writing from the Issuer be required by the separate or co-Trustee so appointed by the Indenture Trustee for more fully and certainly vesting in and confirming to him, her or it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer. In case any separate or co-Trustee, or a successor to either, shall die, become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate or co-Trustee, so far as permitted by law, shall vest in and be exercised by the Indenture Trustee until the appointment of a new Indenture Trustee or a successor to such separate or co-Trustee. Section 6.11. Successor Indenture Trustee as Trustee of Funds. In the event of a change of the Indenture Trustee the predecessor which has resigned or been removed shall cease to be trustee of any funds then held by it hereunder and the successor Indenture Trustee shall become such trustee. Section 6.12. Indemnification. (a) The Indenture Trustee shall not be under any obligation or duty to perform any act at the request of the Noteholders or the Issuer or to institute or defend any suit in respect hereof or to exercise any remedy hereunder unless properly indemnified to its satisfaction subject to Section 6.01(i) hereof, except making payment of principal and interest or accelerating the Notes as provided herein. The Indenture Trustee shall not be required to take notice, or be deemed to have knowledge, of any default of the Issuer, except as provided in Section 6.01(g). (b) The Issuer agrees to indemnify the Indenture Trustee for, and to hold it harmless against, any loss, liability or expense, including reasonable attorneys' fees and expenses, incurred without negligence or bad faith or willful misconduct on its part, arising out of or in connection with the acceptance or administration of the trust or trusts 48 hereunder, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder except as a result of negligence, bad faith or willful misconduct on its part and except any liability to the DOE on account of the Indenture Trustee's status as such. Section 6.13. Eligibility Requirements for Indenture Trustee. The Indenture Trustee and any successor Indenture Trustee shall at all times be (i) an institution insured by the Federal Deposit Insurance Corporation, (ii) a corporation or national bank or national banking association organized and doing business under the laws of the United States of America or any state thereof, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by federal and state authority, (iii) an institution whose long-term senior unsecured debt is rated at least "Ba2", in the case of Moody's, or "BBB-", in the case of Fitch, Inc. (or in the case of each Rating Agency, such lower rating as is confirmed by such Rating Agency in writing would not adversely affect any of the ratings then assigned to the Notes), and (iv) unaffiliated with the Issuer or AMS. If such corporation, national bank or national banking association publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then, for the purposes of this Section, the combined capital and surplus of such corporation, national bank or national banking association shall be deemed to be its combined capital and surplus as set forth in its most recent report or condition so published. If at any time the Indenture Trustee shall cease to be eligible in accordance with the provisions of this Section, the Indenture Trustee shall resign immediately in the manner and with the effect specified in Section 6.06. No person shall become a successor trustee hereunder if the succession of such Person would result in the qualification, downgrading and withdrawal of any of the ratings then assigned by the Ratings Agencies to the Notes. Section 6.14. Tax Information. The Indenture Trustee shall deliver to each Noteholder such information as may be required to enable such holder to prepare its federal and state income tax returns, provided that such information shall consist only of Form 1099's or any successor forms required to be given to Noteholders pursuant to the Code. Article VII [RESERVED] Article VIII SETTLEMENTS Section 8.01. Trust Accounts; Investments by Indenture Trustee. (a) Trust Accounts. On or before the Closing Date, the Indenture Trustee shall establish, for the benefit of the Noteholders, to the extent of their interests therein as provided herein, the Collection Account, Reserve Account, Capitalized Interest Account, 49 Funding Account and Acquisition Account, which Trust Accounts shall be maintained as Eligible Deposit Accounts. Subject to the further provisions of this Section 8.01, the Indenture Trustee shall, upon receipt deposit into such Trust Accounts all amounts received by it which are required to be deposited therein in accordance with the provisions hereof. All such amounts and all investments made with such amounts, including all income and other gain from such investments, shall be held by the Indenture Trustee in such Trust Accounts as part of the Collateral as herein provided, subject to withdrawal by the Indenture Trustee in accordance with, and for the purposes specified in the provisions of, this Indenture. (b) Administration of Payments. The Indenture Trustee shall assume that any amount remitted to it by the Servicer, any Sub-servicer or the Issuer is to be deposited into the Collection Account pursuant to Section 8.03. The Indenture Trustee may establish from time to time such deadline or deadlines as it shall determine are reasonable or necessary in the administration hereof after which all amounts received or collected by the Indenture Trustee on any day shall not be deemed to have been received or collected until the next succeeding Business Day. (c) No Set-Off. None of the Eligible Lender Trustee or the Indenture Trustee shall have any right of set-off against Collections, Trust Accounts, or any investment therein, whether or not commingled to satisfy any other obligations, and each of the Eligible Lender Trustee and the Indenture Trustee hereby irrevocably waives any and all such rights. (d) Investments. Amounts in the Trust Accounts shall be invested and reinvested by the Indenture Trustee in Eligible Investments. Subject to the restrictions on the maturity of investments set forth in Section 8.01(f), an Issuer Order may authorize the Indenture Trustee to make the specific Eligible Investments set forth therein, to make Eligible Investments from time to time consistent with the general instructions set forth therein, or to make specific Eligible Investments pursuant to instructions received in writing or by facsimile transmission from the employees or agents of the Issuer identified therein, in each case in such amounts as such Issuer Order shall specify. The Issuer agrees to report as income for financial reporting and tax purposes (to the extent reportable) all investment earnings on amounts in the Trust Accounts. (e) Investments in the Absence of an Issuer Order; Notice of Uninvested Cash. In the event that either (i) the Issuer shall have failed to give investment directions to the Indenture Trustee by 11:00 a.m., New York City time, on any Business Day on which there may be uninvested cash deposited in the Trust Accounts or (ii) an Event of Default or Unmatured Event of Default shall have occurred and be continuing, then the Indenture Trustee shall invest such funds in Eligible Investments described in clause (iv) of the definition thereof. All Eligible Investments made by the Indenture Trustee shall mature no later than the maturity date therefor permitted by Section 8.01(f). (f) Maturity of Eligible Investments. All Eligible Investments shall mature (or, with respect to mutual fund investments, shall be redeemable without premium or penalty) no later than the Business Day prior to each Fee Remittance Date or Payment 50 Date, as applicable. All income or other gains from the investment of moneys deposited in the Trust Accounts shall be deposited by the Indenture Trustee in the Collection Account upon receipt and shall be deemed to constitute a portion of the Available Funds for the related Payment Date or Fee Remittance Date, as applicable. (g) Form of Investment. Any investment of any funds in the Trust Accounts shall be made under the following terms and conditions: (i) each such investment shall be made in the name of the Indenture Trustee, for the benefit of the Issuer and the Noteholders (to the extent of their respective interests therein), or in the name of a nominee of the Indenture Trustee; and (ii) any certificate or other instrument evidencing such investment shall be delivered directly to the Indenture Trustee, and the Indenture Trustee shall have sole possession of such instrument, and all income on such investment. (h) [Reserved.] (i) Indenture Trustee Not Liable. The Indenture Trustee shall not in any way be held liable by reason of any insufficiency in the Trust Accounts resulting from losses on investments made in accordance with the provisions of this Section 8.01 (but the institution serving as Indenture Trustee shall at all times remain liable for its own debt obligations, if any, constituting part of such investments) except for negligence or intentional misconduct. The Indenture Trustee shall not be liable for any investment made by it in accordance with this Section 8.01 on the grounds that it could have made a more favorable investment. Section 8.02. Collection of Moneys. 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 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 in accordance with the terms hereof. Any such action shall be without prejudice to any right to claim a Default or Event of Default under this Indenture and any right to proceed thereafter as provided in Article V. If at any time the Issuer shall receive any Collections on or in respect of any Financed Student Loan (including any Student Loan Guaranty Payment or Subsidy Payment), it shall hold such Collections for the benefit of the Indenture Trustee (for the benefit of the Noteholders), shall segregate such payment from the other property of the Issuer and shall deliver such payment in the form received (endorsed as necessary for 51 transfer) to the Indenture Trustee for deposit in the Collection Account in accordance with Section 8.03. Section 8.03. Collection Account. (a) Deposits. The Issuer shall remit all Collections received by it to the Collection Account no later than the close of business on the second Business Day after receipt thereof, and the Servicer shall be instructed to remit all Collections received by it in accordance with the Servicing Agreement to the Collection Account for deposit therein. In addition, the Issuer shall deposit to the Collection Account no later than the close of business on each Determination Date the aggregate Purchase Amounts payable by the Issuer pursuant to Section 2.02. If the Issuer shall receive any written statement from the Servicer stating that any amount previously paid by the Servicer to the Indenture Trustee or Issuer and deposited into the Collection Account was so paid and deposited into the Collection Account in error, the Issuer, if it shall concur as to the truth of such statement, shall forward to the Indenture Trustee in writing, together with such security or indemnity as may be required by it to hold the Indenture Trustee harmless, a copy of such written statement from the Servicer, along with an instruction to the Indenture Trustee to withdraw such amount from the Collection Account and pay such amount to the Servicer. Following receipt from the Issuer of the Servicer's statement and the written instructions set forth in the preceding sentence, so long as no Event of Default shall have occurred and be continuing, the Indenture Trustee shall withdraw such amount from the Collection Account and pay such amount to such Servicer. (b) Payment Date Procedures and Fee Remittance Date Procedures. (i) Amounts on deposit on any Payment Date in the Collection Account representing Available Funds received during or with respect to the Related Collection Period shall be withdrawn from the Collection Account on such Payment Date as specified below no later than 11:00 a.m. (New York City time), in the amounts required, and applied in the following order of priority, in each case to the extent of Available Funds remaining after application of each clause representing a higher priority: first, (a) an amount equal to the Class A Noteholders' Interest Distribution Amount shall be paid to the Class A Noteholders, and (b) all net amounts, if any, due and owing a Swap Counterparty (other than any termination payments under the related Swap Agreement) shall be paid to the Swap Counterparty (such amounts to be deposited or paid under (a) and (b) of this clause first pari pasu); second, an amount equal to the Class B Noteholders' Interest Distribution Amount shall be paid to the Class B Noteholders; third, if the amount on deposit in the Reserve Account is less than the Specified Reserve Account Balance, an amount sufficient to cause the amount on deposit in the Reserve Account to equal the Specified Reserve Account Balance will be deposited into the Reserve Account; 52 fourth, if such Payment Date occurs after the end of the Acquisition Period, an amount equal to the Principal Distribution Amount shall be paid as a distribution of principal FIRST to the Class A Noteholders until the Class A Note Principal Amount shall be reduced to zero and SECOND to the Class B Noteholders until the Class B Note Principal Amount shall be reduced to zero; fifth, if such Payment Date occurs on or after the Parity Date, an amount equal to the Class A Noteholders' Interest Basis Carryover shall be paid to the Class A Noteholders; sixth, if such Payment Date occurs on or after the Parity Date, an amount equal to the Class B Noteholders' Interest Basis Carryover shall be paid to the Class B Noteholders; seventh, an amount equal to any amounts due and owing to a Swap Counterparty (other than amounts paid in accordance with clause first above) shall be paid to the Swap Counterparty; and eighth, any Available Funds remaining in the Collection Account after the distributions pursuant to clauses first through seventh above (a) on each Payment Date occurring during the Acquisition Period, shall be deposited into the Acquisition Account and used to purchase Additional Financed Student Loans from the Seller and (b) on each Payment Date occurring after the Acquisition Period shall be paid to the Issuer free and clear of the lien of the Indenture on such Payment Date. (ii) Amounts on deposit on any Fee Remittance Date in the Collection Account representing Available Funds received during or with respect to the related Collection Period shall be withdrawn from the Collection Account on such Fee Remittance Date as specified below no later than 11:00 a.m. (New York City time), in the amounts required, and applied in an amount equal to the sum of (i) the Servicing Fee Amount for the Financed Student Loans with respect to such Fee Remittance Date, plus any overdue Servicing Fee Amounts, (ii) the Eligible Lender Trustee's Fees with respect to such Fee Remittance Date, plus any overdue Eligible Lender Trustee's Fees and (iii) the Indenture Trustee's Fees with respect to such Fee Remittance Date, plus any overdue Indenture Trustee's Fees, and shall in each case be paid to the Servicer, the Eligible Lender Trustee (in the case of the Eligible Lender Trustee's Fee) and the Indenture Trustee (in the case of the Indenture Trustee's Fee), pari passu (based on the ratio of each such amount to the total of such amounts), on such Fee Remittance Date. (c) [Reserved]. (d) [Reserved]. (e) [Reserved]. (f) [Reserved]. 53 Section 8.04. Reserve Account. (a) On the Closing Date, the Issuer shall deposit the Reserve Account Initial Deposit into the Reserve Account. (b) On each Payment Date (after giving effect to any deposit to the Reserve Account pursuant to Section 8.03(b)(i) third, and after giving effect to any withdrawal from the Reserve Account pursuant to Section 8.04(d)), the Issuer shall instruct the Indenture Trustee to withdraw from the Reserve Account the amount of any Reserve Account Excess and deposit such amount into the Collection Account to be allocated and distributed in accordance with Section 8.03(b). (c) Following the payment in full of the Note Principal Amount and of all other amounts owing or to be distributed hereunder to the Servicer, the Indenture Trustee (such Servicer and Indenture Trustee fees to be paid pari pasu), the Eligible Lender Trustee and the Noteholders (including any Noteholders' Interest Basis Carryover), any amount remaining on deposit in the Reserve Account shall be distributed to the Issuer. The Issuer shall in no event be required to refund any amounts properly distributed pursuant to this Section 8.04(c). (d) Amounts on deposit in the Reserve Account will be applied (i) on each Fee Remittance Date to cover any shortfalls (as indicated in Section 8.03(b)(ii)) in payments of the Servicing Fee Amount and the Trustee Fees and any such amounts that are overdue Servicing Fee Amounts and Trustee Fees (such fees to be paid pari passu), in each case for which Available Funds allocable on such Fee Remittance Date are insufficient to pay such amounts, (ii) on each Payment Date to cover any shortfall in the Noteholders' Interest Distribution Amount required to be paid on such Payment Date, for which Available Funds allocable thereto for such Payment Date and, for each Payment Date up through and including July 2004, amounts on deposit in the Capitalized Interest Account, are insufficient to make such payments and (iii) only on the Payment Date on which either (A) the Final Scheduled Payment Date (whether as scheduled or if accelerated after an Event of Default) for a Class of Notes occurs or (B) after allocating all Available Funds and making any withdrawals required under clause (i) and (ii) above, the remaining balance on deposit in the Reserve Account exceeds the remaining principal balance of the Notes, in the case of clause (A) to pay the remaining principal balance of the maturing Class of Notes, and in the case of clause (B), to pay the remaining principal balance of all the Notes outstanding. Section 8.05. Funding Account and Acquisition Account. (a) On the Closing Date, the Issuer shall deposit into the Funding Account $[94,602,119] from the proceeds of the issuance of the Notes. (b) On each applicable Transfer Date during the Funding Period, the Issuer shall instruct the Indenture Trustee to withdraw from the Funding Account an amount equal to the purchase price to be paid by the Issuer for Additional Financed Student Loans transferred to the Eligible Lender Trustee on behalf of the Issuer on such Transfer 54 Date and to distribute such amount to or upon the order of the Issuer upon satisfaction of the conditions set forth in Section 3.2 of the Purchase and Contribution Agreement with respect to such transfer. In addition, on each applicable Transfer Date during the Acquisition Period, the Issuer shall instruct the Indenture Trustee to withdraw from the Acquisition Account an amount equal to the purchase price to be paid by the Issuer for Additional Financed Student Loans transferred to the Eligible Lender Trustee on behalf of the Issuer on such Transfer Date and to distribute such amount to or upon the order of the Issuer upon satisfaction of the conditions set forth in Section 3.2 of the Purchase and Contribution Agreement with respect to such transfer. (c) On each Transfer Date during the Funding Period the Issuer shall instruct the Indenture Trustee as to whether the aggregate purchase price of the Additional Financed Student Loans then being purchased shall be withdrawn form the Acquisition Account or from the Funding Account, or alternatively the Issuer shall specify to the Indenture Trustee the portion of such purchase price that is to be withdrawn from each such account. (d) The aggregate amount to be withdrawn from either or both of the Funding Account and the Acquisition Account on any Transfer Date to pay the purchase price of any Additional Financed Student Loan shall in no event exceed the Principal Balance of such Student Loan as of the related Cut-off Date. (e) If the amount remaining in the Funding Account is less than or equal to $1,000,000 on the date on which the Funding Period ends, after giving effect to any reductions in the Funding Account as the result of the purchase of Additional Financed Student Loans by the Issuer on such date, the Indenture Trustee shall (i) if the Acquisition Period has not yet terminated, deposit the amount so remaining in the Funding Account on such date into the Acquisition Account or (ii) if the Acquisition Period has terminated, apply the amount so remaining to pay principal of the Notes on the next Payment Date. If the amount remaining in the Funding Account is more than $1,000,000 on the date on which the Funding Period ends after giving effect to any reductions in the Funding Account as the result of the purchase of Additional Financed Student Loans by the Issuer on such date, the Indenture Trustee shall apply the amounts remaining on deposit in the Funding Account on such date to pay principal of the Notes on the next Payment Date. Any amount remaining on deposit in the Acquisition Account on the date on which the Acquisition Period ends, after giving effect to any reductions in the Acquisition Account as the result of the purchase of Additional Financed Student Loans by the Issuer on such date, shall be applied by the Indenture Trustee to pay principal of the Notes on the next Payment Date. Section 8.06. [Reserved] Section 8.07. [Reserved] 55 Section 8.08. [Reserved] Section 8.09. Capitalized Interest Account. (a) On the Closing Date, the Issuer shall deposit into the Capitalized Interest Account $2,250,000. On each Payment Date up through and including July 2004, the Issuer shall instruct the Indenture Trustee to transfer from the Capitalized Interest Account to the Collection Account the Capitalized Interest Requirement for such Payment Dates. (b) Immediately after the last Payment Date with respect to which the Capitalized Interest Requirement may be transferred to the Collection Account as provided in clause (a) above, any amounts remaining in the Capitalized Interest Account shall be paid to the Issuer free and clear of the Indenture. Immediately after such transfers, the Capitalized Interest Account shall be closed. 56 Article IX REDEMPTION Section 9.01. Redemption. (a) [Reserved] (b) [Reserved] (c) The Issuer, at its option, may elect to redeem the outstanding Class A Notes, in whole or in part, on each Payment Date, at an aggregate price equal to the outstanding principal amount of the Class A Notes so redeemed, plus accrued interest thereon to the respective dates of redemption and any unpaid Noteholders' Interest Basis Carryover relating to the Class A Notes so redeemed. Notice of any redemption pursuant to this Section 9.01(c) shall be furnished by the Issuer to the Indenture Trustee not less than 30 nor more than 60 days prior to the Redemption Date whereupon all of the amounts set forth above in this Section 9.01(c) shall be payable on such Redemption Date. To the extent that redemption pursuant to this Section 9.01(c) is a partial redemption, amounts paid by the Issuer to the Class A Noteholders to redeem the Outstanding Notes shall be paid pro rata within such Class. (d) The Issuer, at its option but only after the Class A Notes have been paid in full whether by redemption or otherwise, may elect to redeem the outstanding Class B Notes, in whole or in part, on each Payment Date, at an aggregate price equal to the outstanding principal amount of the Class B Notes so redeemed, plus accrued interest thereon to the date of redemption and any unpaid Noteholders' Interest Basis Carryover relating to the Class B Notes so redeemed. Notice of any redemption pursuant to this Section 9.01(d) shall be furnished by the Issuer to the Indenture Trustee not less than 30 nor more than 60 days prior to the Redemption Date whereupon all of the amounts set forth above in this Section 9.01(d) shall be payable on such Redemption Date. To the extent that redemption pursuant to this Section 9.01(d) is a partial redemption, amounts paid by the Issuer to the Class B Noteholders to redeem the Outstanding Notes shall be paid pro rata within such Class. Section 9.02. Form of Redemption Notice. Notice of redemption under Section 9.01 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. All notices of redemption shall state: (i) the Redemption Date; (ii) the Redemption Price; and 57 (iii) in the case of redemption in full, 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 1.03). 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 9.03. 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 X MISCELLANEOUS Section 10.01. Amendments, Etc. (a) Without the consent of any Noteholders, the Issuer and the Indenture Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Indenture Trustee, for any of the following purposes: (i) to add to the covenants of the Issuer for the benefit of the Noteholders, or to surrender any right or power herein conferred upon the Issuer; (ii) to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein; or (iii) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or to better assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture; or (iv) to evidence and provide for the acceptance of the appointment of a successor Indenture Trustee; or (v) add, change or eliminate any other provision herein in any manner; provided such action pursuant to this Section 10.01(a) shall not materially and adversely affect the interests of the Noteholders in any respect. The Indenture Trustee shall promptly deliver to each Noteholder and the Rating Agencies a copy of any supplemental indenture entered into pursuant to this Section 10.01(a). 58 (b) With the written consent of the Holders of not less than 66-2/3% of the outstanding principal amount of the Notes comprising the Controlling Class, the Issuer and the Indenture Trustee may 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 supplemental indenture shall, without the written consent of the Holder of each Outstanding Note affected thereby, (i) change the Final Scheduled Payment Date of any Note or the principal payments or interest payments due or to become due on any Payment Date with respect to any Note, or change the priority of payment thereof as set forth herein, or reduce the principal amount thereof or the Note Rate thereon, or change the place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the maturity thereof; (ii) reduce the percentage of the Note Principal Amount required for any such supplemental indenture pursuant to Section 10.01(b) hereof, for any waiver of compliance with provisions of this Indenture or Events of Default and their consequences, or for any act of Noteholders; (iii) modify any of the provisions of this Section except to increase any percentage or fraction set forth therein or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby; (iv) modify or alter the provisions of the proviso to the definition of the term "Outstanding"; or (v) 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 terminate the lien of this Indenture on any property at any time subject hereto or deprive any Noteholder of the security afforded by the lien of this Indenture; or (vi) result in a taxable event to any Class of Noteholders. (c) In executing any supplemental indenture, the Indenture Trustee shall be entitled to receive and 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 supplemental indenture which affects the Indenture Trustee's own rights, duties, protections, or immunities under this Indenture or otherwise. (d) Upon the execution of any supplemental indenture under this Section 10.01, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes, and every Noteholder of 59 Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. (e) Notwithstanding the foregoing, the effectiveness of any amendments to the Indenture shall be subject to satisfaction of the Rating Agency Condition with respect to such action. Section 10.02. Notices, Etc. All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile communication) and shall be personally delivered or sent by express mail or courier or by certified mail, postage prepaid, or by facsimile, to the intended party at the address or facsimile number of such party set forth under its name on the signature pages hereof or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective, (a) if personally delivered or sent by express mail or courier or if sent by certified mail, when received, and (b) if transmitted by facsimile, when sent, receipt confirmed by telephone or electronic means. Section 10.03. No Waiver; Remedies. No failure on the part of the Issuer, the Indenture Trustee or any Noteholder to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof (unless waived in writing); nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Section 10.04. Binding Effect; Survival. This Indenture shall be binding upon and inure to the benefit of the Issuer, the Indenture Trustee, the Noteholders, and their respective successors and assigns. This Indenture shall create and constitute the continuing obligations of the parties hereto in accordance with its terms, and shall remain in full force and effect until the Final Scheduled Payment Date. The rights and remedies with respect to any breach of any representation and warranty made by the Issuer pursuant to Article II and the indemnification and payment provisions of Article VI, and Section 10.05 and 10.06 shall be continuing and shall survive any termination of this Indenture. Section 10.05. Costs, Expenses and Taxes. The Issuer agrees to pay within three Business Days of demand: (a) all reasonable costs and expenses incurred by the Indenture Trustee and its Affiliates in connection with the negotiation, preparation, execution and delivery, the administration (including periodic auditing and monitoring fees of the Ratings Agencies), the amendment to, or waiver of, or the enforcement of, or any actual or claimed breach of, this Indenture and the other Transaction Documents, including, without limitation (i) the reasonable fees and expenses of counsel to any of such Persons incurred in connection with any of the foregoing or in advising such Persons as to their respective rights and remedies under any of the Transaction Documents, and (ii) all reasonable out-of-pocket expenses (including reasonable fees and expenses of independent 60 accountants), incurred in connection with any review of the Issuer's, the Servicer's or a Sub-servicer's books and records either prior to the execution and delivery hereof or pursuant to this Indenture, the Servicing Agreement or a Sub-servicing Agreement; and (b) all stamp and other taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Indenture or the other Transaction Documents, and agrees to indemnify the Indenture Trustee against any liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees. Section 10.06. No Proceedings. Notwithstanding any provision hereof to the contrary, the Indenture Trustee, by entering into this Indenture, and each Noteholder by accepting a Note, hereby covenant and agree that they will not at any time institute against the Issuer, or join in any institution against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency 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 Transaction Documents. The provisions of this Section 10.06 shall survive the termination of this Indenture. Section 10.07. Captions and Cross References. The various captions (including, without limitation, the table of contents) in this Indenture are provided solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Indenture. Unless otherwise indicated, references in this Indenture to any Section, Appendix, Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to this Indenture, as the case may be, and references in any Section, subsection, or clause to any subsection, clause or subclause are to such subsection, clause or subclause of such Section, subsection or clause. Section 10.08. Integration. This Indenture and the other Transaction Documents, contains a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire understanding among the parties hereto with respect to the subject matter hereof, superseding all prior oral or written understandings. Section 10.09. Governing Law. THIS INDENTURE, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE INTERESTS OF NOTEHOLDERS IN THE COLLATERAL IS GOVERNED BY THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK. THE PARTIES AGREE THAT ALL ACTIONS AND PROCEEDINGS ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE BROUGHT IN THE COUNTY OF NEW YORK AND, IN CONNECTION WITH ANY SUCH ACTION OR PROCEEDING, SUBMIT TO THE JURISDICTION OF, AND VENUE IN, SUCH COUNTY. 61 Section 10.10. Waiver of Jury Trial. THE ISSUER HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS INDENTURE, ANY OTHER TRANSACTION DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH MAY BE IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS INDENTURE OR ANY OTHER TRANSACTION DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT A JURY TRIAL. Section 10.11. Execution in Counterparts. This Indenture may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. Section 10.12. Usury. The amount of interest payable or paid on any Note under the terms of this Indenture shall be limited to an amount that shall not exceed the maximum nonusurious rate of interest allowed by the applicable laws of the State of New York or any applicable law of the United States of America permitting a higher maximum nonusurious rate that preempts such applicable New York laws, which could lawfully be contracted for, charged or received (the "Highest Lawful Rate"). In the event any payment of interest on any Note exceeds the Highest Lawful Rate, the Issuer stipulates that such excess amount will be deemed to have been paid to the applicable Noteholder as a result of an error and the Noteholder receiving such excess payment shall promptly, upon discovery of such error or upon notice thereof from the Indenture Trustee on behalf of the Issuer, refund the amount of such excess or, at the option of such Noteholder, apply the excess to the payment of principal of such Note, if any, remaining unpaid. In addition, all sums paid or agreed to be paid to the Indenture Trustee for the benefit of Noteholders for the use, forbearance or detention of money shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread throughout the full term of such Notes. Section 10.13. Compliance Certificates and Opinions. 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 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 such covenant or condition has been complied with; and 62 (iii) a statement as to whether, in the opinion of each such signatory such condition or covenant has been complied with. [SIGNATURES BEGIN ON FOLLOWING PAGE] 63 IN WITNESS WHEREOF, the parties have caused this Indenture to be executed by their respective officers thereunto duly authorized, as of the date first above written. AMS-2 2002, LP, as Issuer By: AMS-2 SPC-1, INC., as General Partner By: --------------------------------------------- Address: One AMS Place 463 Swansea Mall Drive Swansea, MA 02777 Attention: Mr. Lloyd C. Alcorn Telephone No.: (508) 235-2824 Facsimile No.: (508) 235-2944 BANK ONE, NATIONAL ASSOCIATION, as Indenture Trustee and Eligible Lender Trustee By: --------------------------------------------- Name: Title: Address: 1 Bank One Plaza Suite IL1-0126 Chicago, IL 60670 Attention: Corporate Trust Services Division Telephone No.: (212) 373-1105 Facsimile No.: (212) 373-1383 Solely for the purpose of making the representations and warranties set forth in Section 2.03 AMS-2 SPC-1, INC. By: ----------------------------------- Name: Title: 64