As settlor, Maria transfers her $500,000 mutual fund portfolio into a spousal trust that names her husband Elvis as the income beneficiary and her two children as the capital beneficiaries. Assume Maria dies, under what circumstance does the spousal trust remain valid?
1) While Elvis is alive, the trustee distributes 50% of the investment income generated from the mutual fund portfolio to Elvis and the remaining 50% to Maria's children.
2) While Elvis is alive, the trustee gives one of Maria's children $100,000 to help fund the child's first home purchase.
3) When Elvis becomes seriously ill, the trustee uses the investment income generated from the mutual fund portfolio to pay a nurse to provide care for Elvis.
4) While Elvis is alive, the trustee borrows $25,000 from the spousal trust to pay off his personal credit card debt.