Asset Cover Test Clause Samples
The Asset Cover Test is a financial covenant that requires a borrower or issuer to maintain a minimum ratio of assets to liabilities, ensuring that sufficient assets are available to cover outstanding obligations. In practice, this test is often applied in loan agreements or bond indentures, where the value of specified assets must exceed a certain multiple of the debt owed, and compliance is typically monitored through regular financial reporting. Its core function is to protect lenders or investors by reducing the risk of default, ensuring that the borrower's financial position remains strong enough to meet its repayment commitments.
Asset Cover Test. 3.1 The CBC shall use reasonable efforts to procure that as at the end of each calendar month for so long as the Covered Bonds remain outstanding, provided that no Notice to Pay or CBC Acceleration Notice has been served:
(i) the Adjusted Aggregate Asset Amount (as defined in Schedule 1) will be an amount at least equal to the aggregate Principal Amount Outstanding of the Covered Bonds at the end of such calendar month (or with respect to item B of the Asset Cover Test, up to the date specified in item B), all as calculated on the immediately succeeding Calculation Date;
(ii) the First Regulatory Current Balance Amount will be at least equal to 105 per cent., or such other percentage as may be required from time to time under the CB Regulations, of the aggregate Principal Amount Outstanding of the Covered Bonds at the end of such calendar month (or with respect to item B of the Asset Cover Test, up to the date specified in item B) all as calculated on the immediately succeeding Calculation Date; and
(iii) the Second Regulatory Current Balance Amount will be at least equal to 100 per cent., or such other percentage as may be required from time to time under the CB Regulations, of the nominal value of the obligations in respect of the Covered Bonds, which include repayment of principal, payment of interest, payment obligations under derivative contracts and expected costs related to maintenance and administration for the winding-down of the Programme (in each case within the meaning of the CB Regulations), at the end of such calendar month (or with respect to item B of the Asset Cover Test, up to the date specified in item B) all as calculated on the immediately succeeding Calculation Date, (items (i) up to and including (iii), the "Asset Cover Test").
3.2 Save where otherwise agreed with any Rating Agency, the Asset Percentage will be adjusted in accordance with the various methodologies prescribed by any Rating Agency or will otherwise be in compliance with the relevant methodologies agreed with any Rating Agency from time to time with a view to maintain the rating of the highest rated Series of Covered Bonds. Any adjustment of the Asset Percentage will appear from the relevant Investor Report as the new Asset Percentage as determined in accordance with this Clause. If more than one Rating Agency assigns ratings to the Covered Bonds under the Programme, then in the event the Asset Percentages (as computed in response to the relevant Rating Agency calculati...
Asset Cover Test. Subject to Clauses 3.4 and 3.6 and prior to the service of a Notice to Pay or a CBC Acceleration Notice, the Asset Monitor shall by no later than ten
Asset Cover Test. Subject to Clauses 3.4 and 3.6 and prior to the service of a Notice to Pay, the Asset Monitor shall by no later than ten (10) Business Days following the receipt of the relevant information to be provided to it pursuant to Clause 4, test the arithmetic accuracy of the calculations performed by the CBC (or the Administrator on its behalf) in relation to the Asset Cover Test on the First Issue Date and on each Calculation Date immediately preceding each anniversary of the Programme Date, as applicable, with a view to confirmation of the accuracy or otherwise of such calculations. In this respect, the Asset Monitor shall be provided with figures for the items listed in Clause 4.2 and shall test (a) that A, B, C, Y and Z and the Adjusted Aggregate Asset Amount have been calculated in accordance with Schedule 2 to the Asset Monitoring Agreement; and (b) whether or not the Adjusted Aggregate Asset Amount is an amount at least equal to the euro equivalent of the aggregate Principal Amount Outstanding of the Covered Bonds; and (c) whether the First Regulatory Current Balance Amount is equal to or greater than 105% of the aggregate Principal Amount Outstanding of the Covered Bonds, or such other percentage as may be required from time to time under the CB Regulations; and (d) whether the Second Regulatory Current Balance Amount is equal to or greater than 100% of the aggregate Principal Amount Outstanding of the Covered Bonds, or such other percentage as may be required from time to time under the CB Regulations. The Asset Monitor is not required to test the arithmetic accuracy of α, β, the Current Balance and the Indexed Valuation for each Mortgage Receivable as well as the accuracy of the Asset Percentage and the LTV Cut-Off Percentage and/or any other parameters used in the Asset Cover Test.
Asset Cover Test. Subject to Clauses 3.4 and 3.6 and prior to the service of a Notice to Pay, the Asset Monitor shall by no later than ten (10) Business Days following the receipt of the relevant information to be provided to it pursuant to Clause 4, test the arithmetic accuracy of the calculations performed by the CBC (or the Administrator on its behalf) in relation to the Asset Cover Test on the First Issue Date and on each Calculation Date immediately preceding each anniversary of the Programme Date, as applicable, with a view to confirmation of the accuracy or otherwise of such calculations. In this respect, the Asset Monitor shall be provided with figures for the items listed in Clause 4.2 and shall test (a) that A, B, C and Z and the Adjusted Aggregate Asset Amount have been calculated in accordance with Schedule 2 to the Asset Monitoring Agreement; and
Asset Cover Test. 3.1.1 Subject to Clauses 3.6, prior to the service of a Notice to Pay or a CBC Acceleration Notice, the Asset Monitor shall by no later than ten (10) Business Days following the receipt of the relevant information to be provided to it pursuant to Clause 4, perform agreed upon procedure with respect to the calculations performed by the CBC (or the Administrator on its behalf) in relation to the Asset Cover Test on or before each Calculation Date immediately preceding each anniversary of the Programme Date, as applicable, with a view to confirm the accuracy or otherwise of such calculations. In this respect, the Asset Monitor shall be provided with figures for the items listed in Clause 4.2 and shall perform the following procedures:
(a) that A, B, C, D and Z and the Adjusted Aggregate Asset Amount have been calculated in accordance with Schedule 1 to the Asset Monitoring Agreement;
(b) whether or not the Adjusted Aggregate Asset Amount is an amount at least equal to the aggregate Principal Amount Outstanding of the Covered Bonds;
(c) whether or not the First Regulatory Current Balance Amount is at least equal to 105 per cent. of the aggregate Principal Amount Outstanding of the Covered Bonds, or such other percentage as may be required from time to time under the CB Regulations; and
(d) whether or not the Second Regulatory Current Balance Amount is at least equal to 100 per cent., or such other percentage as may be required from time to time under the CB Regulations, of the nominal value of the obligations in respect of the Covered Bonds, which include repayment of principal, payment of interest, payment obligations under derivative contracts and expected costs related to maintenance and administration for the winding-down of the Programme (in each case within the meaning of the CB Regulations). The Asset Monitor is not required to test the arithmetic accuracy of α, β, the Current Balance and the Indexed Valuation for each Mortgage Receivable as well as the accuracy of the Asset Percentage and the LTV Cut-Off Percentage and/or any other parameters used in the Asset Cover Test.
Asset Cover Test. As Asset Monitor we shall be provided by the SB CBC with figures as at 31 October 2023 for the items listed in Clause 4.2 of the Asset Monitor Appointment Agreement and shall establish the following: Ernst & Young Accountants LLP is a limited liability partnership incorporated under the laws of England and Wales and registe red with Companies House under number OC335594. The term partner in relation to Ernst & Young Accountants LLP is used to refer to (the representative of) a member of Ernst & Young Accountants LLP. Ernst & Young Accountants LLP has its registered office at ▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, its principal place of business at ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ and is registered with the Chamber of Commerce Rotterdam number 24432944. Our services are subject to general terms and conditions, which contain a limitation of liability clause. Principal Amount of the Mortgage Receivables and (ii) the Substitution Assets Amount, where the following is defined:
i. The Outstanding Principal Amount of the Mortgage Receivables is calculated as the lower of
(a) the Mortgage Receivables (Net principal Balance as stated in the Investor Report) and
(b) the LTV Cut-Off percentage of the Indexed Valuation in relation to each Mortgage Receivable, and
ii. The Substitution Assets Amount relates to Transferred Collateral and is equal to B from the Asset Cover Test
i. The nominal value of the claims for payment attached to the cover assets equals the sum of the nominal value of the claims resulting from (A) the Mortgage Receivables (Net Principal Balance as stated in the Investor Report) and (B) the Substitution Assets Amount. The Substitution Assets Amount relates to Transferred Collateral and is equal to B from the Asset Cover Test;
ii. The nominal value of the obligations in respect of the Covered Bonds, which include at least repayment of principal, payment of interest, payment obligations under derivative contracts and expected costs related to maintenance and administration for the winding down of the Programme (in each case within the meaning of the CB Legislation), at the end of such calendar month (or with respect to item B of the Asset Cover Test, up to the date specified in item (B)) all as calculated on the immediately succeeding Calculation Date. A lump sum calculation is allowed for the calculation of the expected costs for an amount equal to the higher of (a) 4 basis points of the aggregate nominal value of the ou...
Asset Cover Test. Subject to Clauses 3.5 and 3.7, prior to the service of a Notice to Pay or a CBC Acceleration Notice, the Asset Monitor shall by no later than ten (10) Business Days following the receipt of the relevant information to be provided to it pursuant to Clause 4, report on the findings resulting from the agreed upon procedures on the calculations performed by the CBC (or the Administrator on its behalf) in relation to the Asset Cover Test on each Calculation Date immediately preceding each anniversary of the Programme Date, as applicable. In this respect, the Asset Monitor shall be provided with figures for the items listed in Clause 4.2 and shall perform the following procedures:
(a) assess the arithmetic accuracy of items A, B, C, D and Z and the Adjusted Aggregate Asset Amount in accordance with Schedule 1 to the Asset Monitoring Agreement;
(b) assess the arithmetic accuracy of the comparison between the Adjusted Aggregate Asset Amount and the aggregate Principal Amount Outstanding of the Covered Bonds;
(c) assess the arithmetic accuracy of the First Regulatory Current Balance Amount in accordance with Schedule 1 to the Asset Monitoring Agreement and assess the arithmetic accuracy of the ratio of the First Regulatory Current Balance Amount compared to the aggregate Principal Amount Outstanding of the Covered Bonds; and
(d) assess the arithmetic accuracy of the Second Regulatory Current Balance Amount in accordance with Schedule 1 to the Asset Monitoring Agreement and assess the arithmetic accuracy of the ratio of the Second Regulatory Current Balance Amount compared to the aggregate Principal Amount Outstanding of the Covered Bonds. The Asset Monitor is not required to test the arithmetic accuracy of α, β, the Current Balance and the Indexed Valuation for each Mortgage Receivable as well as the accuracy of the Asset Percentage and the LTV Cut-Off Percentage and/or any other parameters used in the Asset Cover Test.
Asset Cover Test. The Asset Monitor shall be provided by the SB CBC with figures as per the Calculation Date for the items listed in Clause 4.1 of the Asset Monitor Appointment Agreement and shall establish the following: the aggregate Principal Amount Outstanding of the Covered Bonds, or such other percentage as may be required from time to time under the CB Regulations the aggregate Principal Amount Outstanding of the Covered Bonds, or such other percentage as may be required from time to time under the CB Regulations We are not required to establish the arithmetic accuracy of α, β, the Current Balance and the Indexed Valuation for each Mortgage Receivable nor the accuracy of the Asset Percentage and the LTV Cut-Off Percentage nor any other parameters used in the Asset Cover Test.
Asset Cover Test. The Group Borrower covenants with the Loan Facility Provider to ensure that from the date of the Loan Facility Agreement until all amounts due from the Group Borrower under the Loan Facility Agreement have been repaid in full:
(a) where the Numerical Apportionment Basis has been specified in the Loan Transaction Terms as the method of apportionment of Charged Properties in relation to the Loan Facility, the aggregate of:
(i) the Minimum Value of the NAB Charged Properties multiplied by the Series Security Percentage; and
(ii) the aggregate amount of any Charged Cash in any Cash Security Account relating to such Series, is not less than the outstanding principal amount of the Loan Facility (the NAB Asset Cover Test); and
(b) where the Specific Allocation Basis has been specified in the Loan Transaction Terms as the method of apportionment of Charged Properties in relation to the Loan Facility, the aggregate of:
(i) the Minimum Value of the SAB Charged Properties relating to the relevant Loan Facility; and
(ii) the aggregate amount of any Charged Cash in any Cash Security Account relating to such Series, is not less than the outstanding principal amount of the Loan Facility (the SAB Asset Cover Test);
(c) The Group Borrower shall provide to the Loan Facility Provider and the Security Trustee, on each Valuation Date, a Compliance Certificate, together with the relevant Valuation Report signed by an Authorised Signatory of the Group Borrower.
(d) In the event that the basis of the Loan Facility Provider's apportionment of security in respect of the Group Borrower's obligations under the Loan Facility Agreement is changed to the Specific Apportionment Basis in accordance with the Security Trust Deed, the relevant Asset Cover Test and each of the provisions relating to the release, addition, substitution and apportionment of Charged Properties in the Loan Facility Agreement shall be construed accordingly.