What passenger rule applies to a CLP holder with a School Bus (S) endorsement under federal CDL documentation rules?

1. The holder is prohibited from operating a school bus with passengers other than allowed auditors, inspectors, examiners, trainees, and the accompanying CDL holder
2. The holder may carry students as soon as the written test is passed
3. The holder may carry passengers only if the stop arm is not used
4. The holder may carry passengers interstate but not intrastate