Exhibit 4.10
[o] January 2005
----------------
NORTHERN ROCK PLC
as Administrator
GRANITE FINANCE TRUSTEES LIMITED
as Mortgages Trustee
NORTHERN ROCK PLC
as Seller and Beneficiary
GRANITE FINANCE FUNDING LIMITED
as Beneficiary
GRANITE FINANCE FUNDING 2 LIMITED
as Beneficiary
- and -
THE BANK OF NEW YORK
as Security Trustee and Funding 2 Security Trustee
----------------------------------------------------------------
ADMINISTRATION AGREEMENT
SIXTH DEED OF AMENDMENT AND RESTATEMENT
----------------------------------------------------------------
SIDLEY XXXXXX XXXXX & XXXX
WOOLGATE EXCHANGE
00 XXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
THIS DEED is made on [o] January 2005
BETWEEN:
(1) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales whose registered office
is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as Administrator;
(2) GRANITE FINANCE TRUSTEES LIMITED (registered number 79309), a private
limited company incorporated under the laws of Jersey, Channel Islands
whose registered office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx
XX0 0XX, Channel Islands in its capacity as Mortgages Trustee;
(3) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales whose registered office
is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as Seller and in its capacity as a Beneficiary;
(4) GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
limited company incorporated under the laws of Jersey, Channel Islands
but acting out of its offices established in England (registered
overseas company number FC022999 and branch number BR005916) at 00 Xxxx
Xxxx, Xxxxxxx XX0 0XX in its capacity as a Beneficiary;
(5) GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249887), a private
limited company incorporated under the laws of England and Wales whose
registered office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX in
its capacity as a Beneficiary; and
(6) THE BANK OF NEW YORK a New York banking corporation whose London branch
address is at Xxx Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx X00 0XX in its
capacity as (1) Security Trustee and (2) Funding 2 Security Trustee.
WHEREAS:
(A) The Administrator carries on the business of, inter alia, administering
mortgage loans secured on residential properties within the United
Kingdom.
(B) The Seller has sold and assigned to the Mortgages Trustee certain
Mortgage Loans, together with the benefit of Related Security for the
same on the terms and subject to the conditions set out in the Mortgages
Sale Agreement among the parties hereto.
(C) The Administrator has agreed to administer the Mortgage Loans on behalf
of the Mortgages Trustee (for and on behalf of the Seller and Funding)
and to provide certain other administration and management services to
the Mortgages Trustee, the Seller and Funding on the terms and subject
to the conditions contained in the Administration Agreement dated 26
March 2001 (as amended, varied, novated or supplemented from time to
time, the "Administration Agreement").
(D) The parties have agreed to amend and restate the Administration
Agreement (the "First Amended and Restated Administration Agreement")
pursuant to the
provisions set out in a deed of amendment and restatement dated 28
September 2001 (the "First Deed of Amendment and Restatement").
(E) The parties have agreed to amend and restate the First Amended and
Restated Administration Agreement (the "Second Amended and Restated
Administration Agreement") pursuant to the provisions set out in a deed
of amendment and restatement dated 27 January 2003 (the "Second Deed of
Amendment and Restatement").
(F) The parties have agreed to amend and restate the Second Amended and
Restated Administration Agreement (the "Third Amended and Restated
Administration Agreement") pursuant to the provisions set out in a deed
of amendment and restatement dated 24 September 2003 (the "Third Deed of
Amendment and Restatement").
(G) The parties have agreed to amend and restate the Third Amended and
Restated Administration Agreement (the "Fourth Amended and Restated
Administration Agreement") pursuant to the provisions set out in a deed
of amendment and restatement dated 28 January 2004 (the "Fourth Deed of
Amendment and Restatement").
(H) The parties have agreed to amend and restate the Fourth Amended and
Restated Administration Agreement (the "Fifth Amended and Restated
Administration Agreement") pursuant to the provisions set out in a deed
of amendment and restatement dated 25 June 2004 (the "Fifth Deed of
Amendment and Restatement").
(I) The parties now wish to amend and restate, and Funding 2 and the Funding
2 Security Trustee wish to become party to, the Amended and Restated
Administration Agreement pursuant to the provisions set out herein.
(J) With effect from the date hereof, the provisions of the Administration
Agreement, the First Amended and Restated Administration Agreement, the
Second Amended and Restated Administration Agreement, the Third Amended
and Restated Administration Agreement, the Fourth Amended and Restated
Administration Agreement, the Fifth Amended and Restated Administration
Agreement and this Deed shall be read and construed as follows.
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
1.1 The provisions of the Programme Master Definitions Schedule made on [o]
January 2005 signed for the purposes of identification on [o] January
2005 by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx & Xxxxx LLP (as the same
may be amended, varied or supplemented from time to time with the
consent of the parties hereto) is expressly and specifically
incorporated into and shall apply to this Deed.
1.2 The Administration Agreement as amended and restated pursuant to the
First Deed of Amendment and Restatement, the Second Deed of Amendment
and Restatement, the Third Deed of Amendment and
2
Restatement, the Fourth Deed of Amendment and Restatement, the Fifth
Deed of Amendment and Restatement and pursuant hereto shall be referred
to herein as the "Amended and Restated Administration Agreement".
1.3 As used in the Amended and Restated Administration Agreement the terms
"Administration Agreement", "this Administration Agreement",
"Agreement", "this Agreement", "herein", "hereinafter", "hereof",
"hereto" and other words of similar import shall mean or refer to the
Amended and Restated Administration Agreement, unless the context
otherwise specifically requires.
2. AMENDMENTS TO THE FIFTH AMENDED ADMINISTRATION AGREEMENT
Upon execution of this Deed by the parties hereto, the Fifth Amended and
Restated Administration Agreement shall be and hereby is amended and
restated in the form of Appendix I hereto.
3. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
No person shall have any right to enforce any provision of this Deed or
any provision of the Amended and Restated Administration Agreement under
the Contract (Rights of Third Parties) Xxx 0000 but this shall not
affect any right or remedy of a third party which exists or is available
apart from that Act.
4. COUNTERPARTS
This Deed may be executed in any number of counterparts, and has the
same effect as if the signatures and/or seals on the counterparts were
on a single copy of this Deed.
5. GOVERNING LAW
5.1 This Deed is governed by, and shall be construed in accordance with,
English law.
5.2 Each of the parties hereto irrevocably agrees that the courts of England
shall have jurisdiction to hear and determine any suit, action or
proceeding, and to settle any disputes, which may arise out of or in
connection with this Deed and, for such purposes, irrevocably submits to
the jurisdiction of such courts.
3
EXECUTION PAGE
IN WITNESS WHEREOF this Deed has been executed as a deed and delivered by the
parties hereto on the day and year first above written.
as Administrator, Seller and Beneficiary
EXECUTED AS A DEED by )
NORTHERN ROCK PLC )
by: )
Director
Name:
Title:
Director/Company Secretary
Name:
Title:
as Mortgages Trustee
EXECUTED AS A DEED by )
GRANITE FINANCE TRUSTEES LIMITED )
by: )
Director
Name:
Title:
Director/Company Secretary
Name:
Title:
4
as Beneficiary
EXECUTED AS A DEED by )
GRANITE FINANCE FUNDING LIMITED )
by: )
Director
Name:
Title:
Director/Company Secretary
Name:
Title:
as Beneficiary
EXECUTED AS A DEED by )
GRANITE FINANCE FUNDING 2 LIMITED )
by: )
Director
Name:
Title:
Director/Company Secretary
Name:
Title:
5
as Security Trustee and Funding 2 Security Trustee
EXECUTED AS A DEED by )
THE BANK OF NEW YORK )
acting by: )
Authorised Signatory
Name:
Title:
6
Appendix I
Amended and Restated Administration Agreement
7
Dated [o] 2005
--------------
NORTHERN ROCK PLC
as Administrator
- and -
GRANITE FINANCE TRUSTEES LIMITED
as Mortgages Trustee
- and -
NORTHERN ROCK PLC
as Seller
GRANITE FINANCE FUNDING LIMITED
as Beneficiary
- and -
THE BANK OF NEW YORK
as Security Trustee
----------------------------------------------------------------
SIXTH AMENDED AND RESTATED
ADMINISTRATION AGREEMENT
----------------------------------------------------------------
SIDLEY XXXXXX XXXXX & XXXX
WOOLGATE EXCHANGE
00 XXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
CONTENTS
Clause Page No.
1. Definitions and Interpretation.......................................2
2. Appointment of Administrator.........................................2
3. The Administration Services..........................................3
4. Interest Rates.......................................................7
5. Administration of Mortgages.........................................11
6. No Liability........................................................16
7. New Mortgage Loans..................................................16
8. Product Switching and Further Advances..............................16
9. Redemption of Mortgages.............................................17
10. Powers of Attorney..................................................17
11. Costs and Expenses..................................................18
12. Information.........................................................18
13. Remuneration........................................................21
14. Insurances..........................................................21
15. Title Deeds.........................................................23
16. Data Protection.....................................................24
17. Covenants and Representations and Warranties of Administrator.......25
18. Services Non-exclusive..............................................26
19. Termination.........................................................26
20. Further Assurances..................................................30
21. Miscellaneous.......................................................30
22. Confidentiality.....................................................32
23. No Partnership......................................................32
24. Assignment..........................................................32
25. Security Trustee; Authorised Third Party............................33
26. New Intercompany Loan Agreements....................................34
27. Non Petition Covenant; Limited Recourse.............................34
28. Amendments and Waiver...............................................36
29. Notices.............................................................36
30. Third Party Rights..................................................37
31. Execution in Counterparts; Severability.............................37
32. Governing Law and Submission to Jurisdiction........................38
33. Process Agent.......................................................38
34. Appropriate Forum...................................................38
SCHEDULE 1 THE SERVICES..................................................39
SCHEDULE 2 FORM OF INVESTORS' QUARTERLY REPORT...........................40
SCHEDULE 3 ADMINISTRATOR REPRESENTATIONS AND WARRANTIES..................44
SCHEDULE 4 AUTHORISED THIRD PARTY........................................46
SCHEDULE 5 MINIMUM SERVICING STANDARDS...................................49
THIS SIXTH AMENDED AND RESTATED ADMINISTRATION AGREEMENT DATED [o] 2005 AMENDS
AND RESTATES THE ADMINISTRATION AGREEMENT DATED 26 MARCH 2001 BETWEEN:
(1) NORTHERN ROCK PLC (registered number 3273685), a public limited
company incorporated under the laws of England and Wales whose
registered office is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx
Xxxx XX0 0XX in its capacity as Administrator;
(2) GRANITE FINANCE TRUSTEES LIMITED (registered number 79309), a private
limited company incorporated under the laws of Jersey whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel
Islands in its capacity as Mortgages Trustee;
(3) NORTHERN ROCK PLC (registered number 3273685), a public limited
company incorporated under the laws of England and Wales whose
registered office is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx
Xxxx XX0 0XX in its capacity as Seller and its capacity as a
Beneficiary;
(4) GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
limited company incorporated under the laws of Jersey but acting out
of its branch office established in England (registered overseas
company number FC022999 and branch number BR0051916) at 00 Xxxx Xxxx,
Xxxxxxx XX0 0XX in its capacity as a Beneficiary; and
(5) THE BANK OF NEW YORK, a New York banking corporation whose London
branch address is at One Canada Square, 00xx Xxxxx, Xxxxxx X00 0XX, in
its capacity as Security Trustee.
WHEREAS:
(A) The Administrator carries on the business of, inter alia,
administering mortgage loans secured on residential properties located
within the United Kingdom.
(B) By the Mortgage Sale Agreement, the Seller has agreed to sell and
assign the Mortgage Loans and Related Security comprised in the
Mortgage Portfolio to the Mortgages Trustee. The Mortgages Trustee
shall hold the Mortgage Portfolio together with any New Mortgage
Portfolio on trust for Funding, Funding 2 and the Seller pursuant to
the terms of the Mortgages Trust Deed.
(C) The Administrator is willing to administer the Mortgage Loans on
behalf of the Mortgages Trustee and to provide certain other
administration and management services to the Mortgages Trustee, the
Seller, Funding and Funding 2 on the terms and subject to the
conditions contained in this Agreement in relation to, inter alia, the
Mortgage Loans and Related Security sold and assigned to the Mortgages
Trustee by the Seller.
IT IS HEREBY AGREED as follows:
1. Definitions and Interpretation
1.1 Definitions: The provisions of the Programme Master Definitions
Schedule signed for the purposes of identification by Sidley Xxxxxx
Xxxxx & Xxxx and Xxxxx & Xxxxx LLP on [o], 2005 (as the same have been
and may be amended, varied or supplemented from time to time with the
consent of the parties hereto) are expressly and specifically
incorporated into and shall apply to this Agreement.
1.2 Exercise of Discretion: Any reference in this Agreement to any
discretion, power or right on the part of the Mortgages Trustee shall
be as exercised by the Mortgages Trustee only as directed by the
Beneficiaries but subject in each case to the provisions of the
Mortgages Trust Deed.
1.3 Schedules: For the avoidance of doubt, the parties hereto agree that
the Schedules attached to this Agreement shall form a part of this
Agreement, and the provisions of this Agreement shall be construed in
accordance with such Schedules.
2. Appointment of Administrator
2.1 Appointment: Subject to Clause 4.5 (Termination of Authority) herein,
and until termination pursuant to Clause 19 herein (Termination), the
Mortgages Trustee hereby appoints the Administrator to administer the
Mortgages Loans on its behalf, and each of the Mortgage Trustee, the
Seller and Funding (according to their respective estates and
interests) hereby appoints the Administrator as its lawful agent on
its behalf to provide certain other administration and management
services and to exercise their respective rights, powers and
discretions, and to perform their respective duties, under and in
relation to the Mortgage Loans and their Related Security. The
Administrator in each case hereby accepts such appointment on the
terms and subject to the conditions of this Agreement. The Security
Trustee consents to the appointment of the Administrator on the terms
of and subject to the conditions of this Agreement.
2.2 Appointment by Funding 2: Subject to Clause 4.5 (Termination of
Authority) herein, and until termination pursuant to Clause 19
(Termination) herein, Funding 2 (according to its estates and
interests) hereby appoints the Administrator as its lawful agent on
its behalf to provide certain other administration and management
services and to exercise its rights, powers and discretions, and to
perform its duties, under and in relation to the Mortgage Loans and
their Related Security. The Administrator hereby accepts such
appointment on the terms and subject to the conditions of this
Agreement. The Funding 2 Security Trustee consents to the appointment
of the Administrator on the terms of and subject to the conditions of
this Agreement.
2.3 Power and Authority: For the avoidance of doubt and in connection with
the rights, powers and discretions conferred under Clause 2.1
(Appointment) and Clause 2.2 (Appointment by Funding 2) herein, during
the continuance of its appointment hereunder, the Administrator shall,
subject to the terms and conditions of this
2
Agreement, the Mortgage Conditions, the Mortgage Sale Agreement and
the Mortgages Trust Deed, have the full power, authority and right to
do or cause to be done any and all things which it reasonably
considers necessary, convenient or incidental to the administration of
the Mortgage Loans and their Related Security or the exercise of such
rights, powers and discretions, provided however that neither the
Mortgages Trustee, the Funding Beneficiaries nor their respective
directors shall be required or obliged at any time to enter into any
transaction or to comply with any directions which the Administrator
may give with respect to the operating and financial policies of the
Mortgages Trustee and/or the Funding Beneficiaries and the
Administrator hereby acknowledges that all powers to determine such
policies (including the determination of whether or not any particular
policy is for the benefit of the Mortgages Trustee or any Funding
Beneficiary) are, and shall at all times remain, vested, as the case
may be, in the Mortgages Trustee and/or each Funding Beneficiary (and
their respective directors) and none of the provisions of this
Agreement shall be construed in a manner inconsistent with this
proviso.
2.4 Appointment Conditional: The appointment pursuant to Clause 2.1
(Appointment) herein is conditional upon the issue of the First Issuer
Notes having taken place and shall take effect upon and from the
Initial Closing Date automatically without any further action on the
part of any person PROVIDED THAT if the issue of the First Issuer
Notes has not occurred by 30 April 2001, or such later date as the
First Issuer and the Lead Manager may agree, this Agreement shall
cease to be of further effect.
2.5 Appointment by Funding 2 Conditional: The appointment pursuant to
Clause 2.2 (Appointment by Funding 2) herein is conditional upon the
acquisition by Funding 2 from the Seller of part of the Seller Share
of the Trust Property and shall take effect upon and from the Funding
2 Program Date automatically without any further action on the part of
any person PROVIDED THAT if Funding 2 has not acquired from the Seller
part of the Seller Share of the Trust Property by [o], 2005, or such
later date as Funding 2 and the Seller may agree, the appointment of
the Administrator as agent of Funding 2 under Clause 2.2 (Appointment
by Funding 2) shall not take effect.
3. The Administration Services
3.1 General:
(a) The duty of the Administrator shall be to provide the services
set out in this Agreement including Schedule 1 (the "Services").
(b) If and when the Administrator is required to confirm or state the
capacity in which it is administering or servicing the Mortgage
Loans and their Related Security in the Mortgage Portfolio and
related matters pursuant to this Agreement by any Borrower or any
third party to this Agreement and to whom the Administrator is by
law obliged to disclose such information, unless otherwise
indicated herein the Administrator shall confirm or state that it
is acting in its capacity as administrator of such Mortgage Loans
and their Related Security and related matters as agent for and
on behalf of the Mortgages Trustee and not on its own behalf.
3
3.2 Sub-contracts:
(a) The Administrator may sub-contract or delegate the performance of
all or any of its powers and obligations under this Agreement,
provided that (but subject to Clause 3.2(b) herein):
(i) the prior written consent of the Mortgages Trustee to the
proposed arrangement (including, if the Funding
Beneficiaries consider it necessary after consulting with
the Funding Security Trustees, approving any contract
which sets out the terms on which such arrangements are to
be made) has been obtained, the Funding Security Trustees
have been consulted and notification has been given to
each of the Rating Agencies;
(ii) where the arrangements involve the custody or control of
any Mortgage Loan Files and/or Title Deeds relating to the
Mortgage Portfolio for the purpose of performing any
delegated Services, the sub-contractor or delegate has
executed an acknowledgement in writing acceptable to the
Funding Beneficiaries and the Funding Security Trustees to
the effect that any such Mortgage Loan Files and/or Title
Deeds are and will be held to the order of the Mortgages
Trustee (as trustee for the Beneficiaries);
(iii) where the arrangements involve or may involve the receipt
by the sub-contractor or delegate of monies belonging to
the Mortgages Trustee and/or the Beneficiaries which, in
accordance with this Agreement, are to be paid into the
relevant Collection Account, the sub-contractor or
delegate has executed a declaration in writing acceptable
to the Funding Beneficiaries and the Funding Security
Trustees that any such monies held by it or to its order
are held on trust for the Mortgages Trustee (as trustee
for the Beneficiaries) and will be paid forthwith into the
relevant Collection Account in accordance with the terms
of the Mortgages Trust Deed;
(iv) any such sub-contractor or delegate has executed a written
waiver of any Security Interest arising in connection with
such delegated Services (to the extent that such Security
Interest relates to the Mortgage Portfolio or any amount
referred to in (iii) above); and
(v) neither the Mortgages Trustee, the Funding Security
Trustees nor the Beneficiaries shall have any liability
for any costs, charges or expenses payable to or incurred
by such sub-contractor or delegate or arising from the
entering into, the continuance or the termination of any
such arrangement.
(b) The provisos in Clause 3.2(a) (i), (ii) and (iii) herein shall
not apply:
(i) to the engagement by the Administrator of:
(A) any receiver, solicitor, insurance broker, valuer,
surveyor, accountant, estate agent, insolvency
practitioner, auctioneer,
4
bailiff, debt counsellor, tracing agent, property
management agent, licensed or qualified conveyancer
or other professional adviser acting as such; or
(B) any locksmith, builder or other contractor acting as
such in relation to a Mortgaged Property, in any such
case being a person or persons whom the Administrator
would be willing to appoint in respect of its own
mortgages in connection with the performance by the
Administrator of any of its obligations or functions
or in connection with the exercise of its powers
under this Agreement; or
(ii) to any delegation to any wholly-owned subsidiary of the
Seller from time to time.
(c) The Mortgages Trustee and/or the Funding Beneficiaries and the
Funding Security Trustees may require the Administrator to assign
to the Mortgages Trustee any rights which the Administrator may
have against any sub-contractor or delegate arising from the
performance of services by such person in association with any
matter contemplated by this Agreement and the Administrator
acknowledges that such rights assigned to the Mortgages Trustee
will be exercised by the Mortgages Trustee as trustee for the
Beneficiaries subject to the terms of the Mortgages Trust Deed.
(d) Notwithstanding any sub-contracting or delegation of the
performance of the Administrator's obligations under this
Agreement:
(i) the Administrator shall not thereby be released or
discharged from any liability hereunder;
(ii) the Administrator shall remain responsible for the
performance of the obligations of the Administrator under
this Agreement;
(iii) the performance or non-performance or the manner of
performance of any sub-contractor or delegate of any of
the Services shall not affect the Administrator's
obligations under this Agreement;
(iv) any breach in the performance of the Services by any
sub-contractor or delegate shall, subject to the
Administrator being entitled for a period of twenty (20)
Business Days from receipt of notice of the breach to
remedy such breach by any sub-contractor or delegate, be
treated as a breach of this Agreement by the
Administrator; and
(v) the Funding Security Trustees shall have no liability for
any act or omission of the sub-contractor or delegate and
shall have no responsibility for monitoring or
investigating the suitability of any such sub-contractor
or delegate.
3.3 Notices etc.
(a) Within fifteen (15) days after the Initial Closing Date, the
Administrator will:
5
(i) on behalf of the Mortgages Trustee (at the direction of
the Beneficiaries or with their consent), give to third
parties such notices as any of the Beneficiaries are
required to give pursuant to the Mortgage Sale Agreement;
and
(ii) submit for registration at the Companies Registry a duly
completed Form 395 and original executed copy of the First
Issuer Deed of Charge pursuant to Chapter 1 of Part XII of
the Companies Xxx 0000,
and in each case, the Administrator shall take all reasonable
steps to ensure the return by the relevant recipient of the
duplicate notices of assignment by way of acknowledgement
thereof.
(b) Promptly upon request by the Funding Beneficiaries and the
Funding Security Trustees, the Administrator shall procure that
any notices permitted to be given by the Mortgages Trustee under
Clause 6.4 (Prior to Perfection) of the Mortgage Sale Agreement
are so given by the Administrator on the Mortgages Trustee's
behalf.
3.4 Liability of Administrator:
(a) The Administrator shall indemnify each of the Mortgages Trustee
and the Beneficiaries on demand on an after-tax basis for any
loss, liability, claim, expense or damage suffered or incurred by
either of them in respect of the negligence or wilful default of
the Administrator in carrying out its functions as Administrator
under this Agreement or the other Transaction Documents or as a
result of a breach by the Administrator of the terms and
provisions of this Agreement or the other Transaction Documents
in relation to such functions.
(b) For the avoidance of doubt, the Administrator shall not be liable
in respect of any loss, liability, claim, expense or damage
suffered or incurred by the Mortgages Trustee and/or the
Beneficiaries and/or any other person as a result of the proper
performance of the Services by the Administrator save where such
loss, liability, claim, expense or damage is suffered or incurred
as a result of any negligence or wilful default of the
Administrator or as a result of a breach by the Administrator of
the terms and provisions of this Agreement or the other
Transaction Documents in relation to such functions.
(c) Any indemnification under this Clause 3.4 in respect of loss
suffered by the Beneficiaries whilst Northern Rock is the
Administrator, shall be paid for by reducing the Seller Share of
the Trust Property by an amount equal to the relevant loss
incurred by the Beneficiaries in accordance with Clause 8.5
(Adjustments to Trust Property) of the Mortgages Trust Deed and
Schedule 2 to the Cash Management Agreement.
3.5 Perfection of Mortgages Trustee's and Beneficiaries' Title to the
Mortgage Loans
Subject to Clause 6 of the Mortgage Sale Agreement:
(a) upon the receipt by the Seller of a written request in accordance
with Clause 6.2 (Perfection) of the Mortgage Sale Agreement to
execute transfers and/or
6
assignments, the Administrator shall execute or procure the
execution of such transfers and/or assignments on behalf of the
Seller or shall provide sufficient information to enable the
Mortgages Trustee, either Funding Beneficiary or either Funding
Security Trustee to do so; and
(b) upon the Seller being required to do so in accordance with Clause
6.1 (Perfection Events) of the Mortgage Sale Agreement, the
Administrator shall do all or any of the acts, matters or things
referred to in Clauses 6.2 (Perfection) and 6.3 (Transfer
Documents) of the Mortgage Sale Agreement.
4. Interest Rates
4.1 Determination of Interest Rates: Subject to the provisions of
applicable law, regulations and rules and any regulatory undertakings
binding on the Administrator or the Issuer from time to time and
subject to the following provisions of this Clause 4, the Mortgages
Trustee and each of the Beneficiaries each hereby grants the
Administrator full right, liberty and authority from time to time to
determine:
(a) in accordance with the applicable Mortgage Conditions, Mortgage
Terms and the Base Rate Pledge, the Standard Variable Rate and
any other discretionary rates and margins applicable to the
Mortgage Loans chargeable to Borrowers from time to time; and
(b) the Existing Borrowers' Re-Fix Rate in accordance with Clause 4.4
(Existing Borrowers' Re-Fix Rate) herein.
In exercising such right, liberty and authority the Administrator
undertakes to each of the other parties to this Agreement that it
shall not at any time set or maintain the Standard Variable Rate and
any other discretionary rates and margins applicable to the Mortgage
Loans at rates which are higher than the then prevailing equivalent
rates offered by the Seller, unless the Administrator is required to
do so pursuant to Clause 4.3 (Interest Rate Shortfall) herein, and,
subject to that requirement, that it shall not change the Standard
Variable Rate and any other discretionary rates and margins applicable
to the Mortgage Loans save for the same reasons as the Seller was
entitled, under the Mortgage Conditions, to change the then prevailing
equivalent rates offered by the Seller prior to the sale and
assignment to the Mortgages Trustee of the Mortgage Loans comprised in
the Mortgage Portfolio and their Related Security. Each Issuer,
Funding Beneficiary and Funding Security Trustee shall be bound by any
Mortgage Rates (including the Existing Borrowers' Re-Fix Rate)
determined by the Administrator in accordance with this Clause 4.
4.2 Notification to Borrowers: The Administrator shall take all steps
necessary pursuant to the relevant Mortgage Conditions and/or
applicable law, regulations and rules to bring each change in the
Standard Variable Rate and any other discretionary rate or margin
applicable to the Mortgage Loans and any consequent changes in Monthly
Payments to the attention of the relevant Borrowers and shall, as soon
as reasonably practicable after any change in such rates, provide
details of such changes to the Mortgages Trustee, each Funding
Security Trustee and each Beneficiary, and shall, upon receipt of a
request from any of such parties, notify such requesting party of any
changes in the Monthly Payments in relation to the Mortgage Loans.
7
4.3 Interest Rate Shortfall:
(a) On each Payment Date the Administrator shall determine, having
regard to:
(i) the income which each of Funding and Funding 2 would
expect to receive during the next succeeding Interest
Period;
(ii) the Mortgage Rates in respect of the Mortgage Loans which
the Administrator proposes to set under this Clause 4; and
(iii) the other resources available to Funding including (but
not limited to) the Funding Reserve Fund and amounts
standing to the credit of any applicable Issuer Reserve
Fund and/or any applicable Issuer Liquidity Reserve Fund
and the other resources available to Funding 2 including
(but not limited to) the Funding 2 Reserve Fund, the
Funding 2 Liquidity Reserve Fund and any applicable Issuer
Reserve Fund,
whether:
(A) Funding would receive an amount of income during that
Interest Period which when aggregated with the funds
otherwise available to it is less than the amount
which is the aggregate of (1) the amount of interest
which will be payable by Funding in order to fund
(whether by payment to a swap provider or otherwise)
the amount of interest payable in respect of the
Class A Notes of the Funding Issuers and all amounts
which rank in priority thereto on the Payment Date
occurring at the end of such Interest Period, and (2)
all other amounts payable by Funding which rank in
priority to or pari passu with interest due on each
Funding Intercompany Loan in respect of interest
which is payable on the Class A Notes of the Funding
Issuers (the amount (if any) by which it is less
being the "Funding Interest Rate Shortfall"); and
(B) Funding 2 would receive an amount of income during
that Interest Period which when aggregated with the
funds otherwise available to it is less than the
amount which is the aggregate of (1) the amount of
interest which would be payable by Funding 2 in order
to fund (whether by payment to a swap provider or
otherwise) the amount of interest payable in respect
of the AAA Loan Tranches of each Funding 2
Intercompany Loan and all amounts which rank in
priority thereto on the Payment Date occurring at the
end of such Interest Period and (2) all other amounts
payable by Funding 2 which rank in priority to or
pari passu with interest due on each Funding 2
Intercompany Loan in respect of the AAA Loan Tranches
(the amount (if any) by which it is less being a
"Funding 2 Interest Rate Shortfall").
(b) If the Administrator determines that there will be either a
Funding Interest Rate Shortfall or a Funding 2 Interest Rate
Shortfall, it will within one (1)
8
London Business Day of such determination give written notice
thereof to the Mortgages Trustee, each Funding Beneficiary and
each Funding Security Trustee of such Interest Rate Shortfall(s)
and of the Standard Variable Rate and other discretionary rates
and margins applicable to the Mortgage Loans which would, in the
Administrator's opinion, need to be set in order for:
(i) no Funding Interest Rate Shortfall to arise, having regard
to the obligations of Funding under all Funding
Intercompany Loans;
(ii) no Funding 2 Interest Rate Shortfall to arise, having
regard to the obligations of Funding 2 under all Funding 2
Intercompany Loans; and
(iii) no Interest Rate Shortfalls to arise, having regard to the
obligations of Funding and Funding 2 under all
Intercompany Loans.
(c) If the Mortgages Trustee, Funding and/or the Security Trustee
notify the Administrator that, having regard to the obligations
of Funding, the Standard Variable Rate and other discretionary
rates and margins should be increased in order for no Funding
Interest Rate Shortfall to arise, but no notification is provided
to the Administrator in accordance with Clause 4.3(d) then the
Administrator, as agent for and on behalf of the Mortgages
Trustee, shall take all steps which are necessary, including
publishing any notice which is required in accordance with the
Mortgage Terms, to effect the changes in such rates (such changes
being those previously notified in relation to Clause 4.3(b)(i))
on the date(s) specified in the notice referred to in Clause
4.3(b) herein.
(d) If the Mortgage Trustee, Funding 2 and/or the Funding 2 Security
Trustee notify the Administrator that having regard to the
obligations of Funding 2, the Standard Variable Rate and the
other discretionary rates and margins should be increased in
order for no Funding 2 Interest Rate Shortfall to arise, but no
notification is provided to the Administrator in accordance with
Clause 4.3(c) then the Administrator, as agent for and on behalf
of the Mortgages Trustee, shall take all steps which are
necessary, including publishing any notice which is required in
accordance with the Mortgage Terms, to effect the changes in such
rates (such changes being those previously notified in relation
to Clause 4.3(b)(ii)) on the date(s) specified in the notice
referred to in Clause 4.3(b) herein.
(e) If the Administrator receives notification from:
(i) the Mortgages Trustee, Funding and/or the Security Trustee
in accordance with Clause 4.3(c); and
(ii) the Mortgage Trustee, Funding 2 and/or the Funding 2
Security Trustee in accordance with Clause 4.3(d),
then the Administrator, as agent for and on behalf of the
Mortgages Trustee, shall take all steps which are necessary,
including publishing any notice which is required in accordance
with the Mortgage Terms, to effect the changes in such rates
(such changes being those previously notified in relation to
Clause
9
4.3(b)(iii)) on the date(s) specified in the notice referred to
in Clause 4.3(b) herein.
4.4 Existing Borrowers' Re-Fix Rate:
(a) The Administrator shall, in relation to each Fixed Rate Mortgage
Loan, serve on the Seller as agent for and on behalf of, inter
alios, the Mortgages Trustee and the Beneficiaries the notice
referred to in Clause 8.6(a) of the Mortgage Sale Agreement sixty
(60) days before the expiry of the initial fixed rate period (as
defined in Clause 8.6(a) of the Mortgage Sale Agreement)
applicable to that Fixed Rate Mortgage Loan.
(b) If Clause 8.6(b) of the Mortgage Sale Agreement applies to any
Fixed Rate Mortgage Loan, the Administrator shall take all steps
which are necessary to perform the obligations of the Seller and
exercise the rights under such Clause.
(c) The Administrator shall, whenever Clause 8.6(c) of the Mortgage
Sale Agreement applies to a Fixed Rate Mortgage Loan, determine
(after consultation with the Swap Providers, and any other swap
provider the Administrator (acting reasonably) determines
appropriate) the rate (and terms) upon which the Existing
Borrowers' Re-Fix Rate should be set having regard to the
interests of each Swap Provider (except to the extent that the
Administrator believes that the interests of any Swap Provider
are materially prejudicial to the interests of the Noteholders in
respect of the Funding Issuers and/or the Noteholders in respect
of the Funding 2 Issuers). The Administrator will give written
notice of such determination within one Business Day thereof to
the Mortgages Trustee and the Beneficiaries recommending what the
Existing Borrowers' Re-Fix Rate should be and the terms at which
it should be offered, having regard to the interests of the Swap
Providers (except to the extent that the Administrator believes
that the interests of any Swap Provider are materially
prejudicial to the interests of the Noteholders in respect of the
Funding Issuers and/or the Noteholders in respect of the Funding
2 Issuers). The Administrator will solicit quotations on rates
from each of (i) the Mortgages Trustee, (ii) Funding, (iii)
Funding 2 and (iv) other trustees for re-fixed mortgage loans in
relation to other outstanding securitisations of the Seller (if
any), and shall notify the Mortgages Trustee and the
Beneficiaries as to the higher of (x) any rate provided by any of
the parties in (i) through (iv) herein and (y) current rates for
re-fixed mortgage loans (not included in any Mortgage Portfolio)
in relation to other Mortgage Loans of the Administrator. If the
Mortgages Trustee agrees in writing with such recommendation, or
(whether or not it has received the Administrator's
recommendation) requires alternative rates and/or terms (such
agreement or requirement being the "EBRR Determination") the
Administrator shall immediately notify the Seller, each Funding
Beneficiary and each Issuer of the EBRR Determination, and take
all steps which are necessary to enable each Funding Beneficiary
and each Issuer to enter into the relevant swap agreement with
the applicable Swap Provider(s) (or other swap provider whose
appointment would not adversely affect the then current ratings
of the Notes) at the rate (and on the terms) required in
accordance with the EBRR Determination (the "Required Rate and
Terms"). Nothing in this Clause 4.4(c) shall prevent the
Mortgages Trustee from setting the Existing
10
Borrowers' Re-Fix Rate in accordance with its powers under the
Mortgage Sale Agreement.
(d) If Clause 8.6 (Purchase of Product Switches, Further Advances and
purchases relating to Personal Secured Loans) of the Mortgage
Sale Agreement applies to any Fixed Rate Mortgage Loan, and the
Seller fails to set the Existing Borrowers' Re-Fix Rate
immediately upon being required to do so in accordance with the
Required Rate and Terms or otherwise to perform its obligations
under Clause 8.6(c) of the Mortgage Sale Agreement, the
Administrator as attorney for the Mortgages Trustee and the
Beneficiaries shall set the Existing Borrowers' Re-Fix Rate on
the Required Rate and Terms.
4.5 Termination of Authority: The Mortgages Trustee and/or the Funding
Beneficiaries and the Funding Security Trustees may terminate the
authority of the Administrator under Clauses 4.1 (Determination of
Interest Rates) and 4.3 (Interest Rate Shortfall) herein to determine
either of the Mortgage Rate(s) or Existing Borrowers' Re-Fix Rate on
or after the occurrence of a Termination Event pursuant to Clause 19
(Termination) herein, in which case the Mortgages Trustee shall set
the Mortgage Rate(s) or Existing Borrowers' Re-Fix Rate, as
applicable, in accordance with this Clause 4.
5. Administration of Mortgages
5.1 Collection of Payments:
(a) For the purposes of collecting amounts due from any Borrower
under a Mortgage Loan, where such Borrower makes a Monthly
Payment by way of Direct Debit the Administrator will, unless
otherwise agreed in writing with the Beneficiaries:
(i) act as collecting agent for the Beneficiaries under the
Direct Debiting Scheme;
(ii) comply with the obligations on its part set out in the
Bank Account Agreement including, without limitation, the
specific provisions relating to the collection of monies
set out in Clause 4 of the Bank Account Agreement;
(iii) comply in all material respects with the requirements from
time to time of the Direct Debiting Scheme; and;
(iv) using its reasonable endeavours, credit any Monthly
Payment made by a Borrower by way of Direct Debit to the
relevant Collection Account within one (1) London Business
Day of receipt (and in any event within three (3) London
Business Days of such receipt) into the relevant
Collection Account.
(b) The Administrator may agree with a Borrower that the Direct
Debiting Scheme shall not apply to Monthly Payments to be made by
such Borrower, provided that (i) alternative payment arrangements
are made which are intended to ensure the timely making of
Monthly Payments due from the
11
Borrower to the Mortgages Trustee, and (ii) the change in
arrangements was made at the instigation of the Borrower or by
the Administrator in accordance with the procedures which would
be adopted by a reasonable and prudent mortgage lender. The
Administrator shall, using its reasonable endeavours, credit
Monthly Payments made by a Borrower under an alternative payment
arrangement as follows to the relevant Collection Account:
(i) by standing order, by close of business on the second
(2nd) London Business Day following the day on which such
amount is received or credited by the Administrator;
(ii) by payment of cash, transfer payment from another account
of the Seller or check where reference to the relevant
Borrower is provided or payments made by way of paying-in
book, by close of business on the London Business Day
which immediately follows the day on which such amount is
received or credited by the Administrator; and
(iii) in the case of any payment by check where a reference to
the relevant Borrower is not provided, by close of
business on the next London Business Day after
notification from the Operating Banks of the identity of
the Borrower,
provided however, that in any event the Administrator shall credit
Monthly Payments made by a Borrower under an alternative payment
arrangement within three (3) London Business Days of such receipt.
(c) The Administrator may, notwithstanding the proviso in Clause
5.2(b) herein, agree such procedures for the payment by a
Borrower of (i) overdue amounts and (ii) amounts payable on
redemption of a Mortgage in whole or in part other than through
the Direct Debiting Scheme as would be agreed by a reasonable and
prudent mortgage lender.
(d) Where a Borrower permits a Direct Debit to be made to his bank
account, the Administrator will endeavour to procure that such
Borrower maintains a valid and effective mandate relating to such
Direct Debit in relation to each Monthly Payment due from that
Borrower, provided that in any case where a Borrower will not
permit a Direct Debit to be made to his bank account the
Administrator will endeavour to make alternative arrangements
acceptable to a reasonable and prudent mortgage lender so that
such Borrower nevertheless pays each Monthly Payment on the due
date.
(e) In the event that the Bankers Automated Clearing System ceases to
operate for any reason the Administrator will use reasonable
endeavours to make alternative arrangements for the use of the
back-up systems available to each Account Bank.
5.2 Administration and Enforcement of Mortgages:
(a) The Mortgages Trustee as trustee for the Beneficiaries hereby
directs the Administrator to administer the Mortgage Loans
comprised in the Mortgage
12
Portfolio and carry out its specific obligations under this
Agreement in accordance with the Administration Procedures.
(b) The Administrator will, in relation to any default by a Borrower
under or in connection with a Mortgage Loan or a Mortgage
comprised in the Mortgage Portfolio, comply with the Enforcement
Procedures or, to the extent that the Enforcement Procedures are
not applicable having regard to the nature of the default in
question, take such action as is not materially prejudicial to
the interests of the Mortgages Trustee (as trustee for the
Beneficiaries) and the Beneficiaries under the relevant MIG
Policy, provided that:
(i) the Administrator shall only become obliged to comply with
the Enforcement Procedures (to the extent applicable) or
to take action as aforesaid after it has become aware of
the default;
(ii) it is acknowledged by the Beneficiaries that mortgage
lenders generally exercise discretion in pursuing their
respective enforcement procedures and that the
Administrator may exercise such discretion as would a
reasonable and prudent mortgage lender in applying the
Enforcement Procedures to any particular defaulting
Borrower or taking action as aforesaid, provided that in
exercising such discretion the interest of Funding and/or
Funding 2 in the Mortgage Portfolio is not materially
prejudiced; and
(iii) in any case where any of the Insurance Policies requires
exact compliance with certain enforcement procedures, the
Administrator shall procure the prior written consent of
the relevant insurance company for any deviation by it
from such enforcement procedures.
5.3 Records: The Administrator shall keep and maintain records in relation
to the Mortgage Portfolio, on a Mortgage Loan by Mortgage Loan basis,
for the purposes of identifying amounts paid by each Borrower, any
amount due from a Borrower and the balance from time to time
outstanding on a Borrower's account and such other records as would be
kept by a reasonable and prudent mortgage lender. Subject always to
the restrictions and conditions set forth in Clause 16 (Data
Protection), the Administrator will provide such information to the
Mortgages Trustee and/or each Funding Beneficiary and/or each Funding
Security Trustee at any time upon reasonable notice, subject to the
Administrator being reasonably capable of providing such information
without significant additional cost and subject to the provisions of
the Data Protection Xxx 0000 and other applicable legislation from
time to time, and provided that no duty of confidence and no industry
code of practice will or may be breached thereby.
5.4 Trust:
(a) If the Administrator, in carrying out its functions as
Administrator under this Agreement, receives (including in its
capacity as agent for the Mortgages Trustee as trustee for the
Beneficiaries) any money whatsoever arising from the Mortgage
Loans and their Related Security, which money belongs to the
Mortgages Trustee (as trustee for the Beneficiaries) and is to be
paid to the relevant Collection Account pursuant to this
Agreement or any of the other Transaction Documents or otherwise,
it will hold such monies on trust for the
13
Mortgages Trustee and shall keep such money separate from all
other monies held by the Administrator and shall, as soon as
reasonably practicable and in any event within three (3) London
Business Days of receipt of the same, pay the monies into the
relevant Collection Account.
(b) All other sums received by the Administrator in respect of the
Mortgage Loans and their Related Security shall be held by the
Administrator for itself.
5.5 Together Connections Mortgage Loans and Connections Mortgage Loans:
(a) The Seller shall, upon request, use its reasonable endeavours to:
(i) provide the Mortgages Trustee, each Funding Beneficiary
and the Administrator with such information (including,
but not limited to documentary information) in its
possession; and
(ii) do such other acts and things,
that the Mortgages Trustee, each Funding Beneficiary and the
Administrator may require in order for such parties to exercise
their rights and comply with their obligations under the Together
Connections Mortgage Loans and the Connections Mortgage Loans and
under the Transaction Documents with respect to the
administration of such Mortgage Loans.
(b) Each of the Mortgages Trustee, each Funding Beneficiary and the
Administrator shall, upon request, use their reasonable
endeavours to:
(i) provide the Seller with such information (including, but
not limited to documentary information) in its possession;
and
(ii) do such other acts and things,
that the Seller may require in order for the Seller to exercise
its rights and comply with its obligations under the Together
Connection Conditions and the Connection Conditions (where such
rights and obligations are not required to be administered by the
Mortgages Trustee, any Funding Beneficiary or the Administrator
under the Transaction Documents) and in respect of the products
linked to the Together Connections Mortgage Loans and Connections
Mortgage Loans.
(c) Any notice, letter or other communication:
(i) received or given by the Seller under the Together
Connection Conditions or the Connection Conditions shall
be copied by the Seller to the Administrator; and
(ii) received or given by the Mortgages Trustee, any Funding
Beneficiary or the Administrator under the Together
Connection Conditions or the Connection Conditions shall
be copied by such parties to the Seller.
(d) The Administrator shall act in accordance with the instructions
of the Seller in any matter where the powers, rights, obligations
or commercial interests of the
14
Seller under the Together Connection Conditions or the Connection
Conditions or with respect to the products linked to the Together
Connections Mortgage Loan or the Connections Mortgage Loan may be
affected in a material manner. Such matters may include, but not
limited to, the following:
(i) any request from a Borrower to amend the allocation of the
Together Connections Benefit or the Connections Benefit
that may accrue to such Borrower under the terms of the
relevant Together Connection Conditions or Connection
Conditions;
(ii) any amendment to the Together Connection Conditions or the
Connection Conditions;
(iii) except where the Administrator is required to act in
accordance with Clause 4.3 (Interest Rate Shortfall), the
determination or variation of the Connection Interest Rate
(provided that such rate shall not at any time be set at a
rate which is higher than the equivalent rate offered by
the Seller);
(iv) any change to the availability or amendment to the
eligibility of any product to be linked to a Together
Connections Mortgage Loan or a Connections Mortgage Loan;
and
(v) the termination of the Together Connection Conditions or
the Connection Conditions.
In all other cases where the Administrator, on behalf of the
other parties hereto is required to exercise its judgment or
discretion in the application of the Together Connection
Conditions or the Connection Conditions, the Administrator
shall undertake the same in consultation with the Seller.
(e) The Seller shall not have any right to provide instructions to
the Administrator in respect of any amendment to the Together
Connection Conditions or Connection Conditions where such
amendment will result in a Product Switch in respect of the
applicable Together Connections Mortgage Loans or Connections
Mortgage Loans unless the Seller has given confirmation in
accordance with the terms of the Mortgage Sale Agreement that it
has elected to repurchase such Together Connections Mortgage
Loans or Connections Mortgage Loans.
5.6 Statement as to Compliance
The Administrator shall deliver to the Mortgages Trustee not later
than 30th April in each year commencing in 2005, an officers'
certificate stating, as to each signatory thereof, that (i) a review
of the activities of the Administrator during the preceding year and
of its performance under this Agreement has been made under such
officers' supervision and (ii) to the best of such officers'
knowledge, based on such review, the Administrator has fulfilled all
of its obligations under this Agreement throughout such year, or, if
there has been a default in the fulfilment of any such obligation,
specifying each such default known to such officers and the nature and
status thereof.
15
5.7 Independent Auditors' Annual Servicer Compliance Certificate
The Administrator shall cause an independent auditor to furnish to the
Administrator and the Mortgages Trustee not later than 30th April in
each year commencing in 2005 a report addressed to the Board of
Directors of the Administrator, substantially to the effect that (a)
such firm has examined certain documents and records of the
Administrator relating to the servicing of residential Mortgage Loans
under this Agreement during the preceding calendar year, (b) such
examination (i) included such tests and auditing procedures as such
firm considered necessary in the circumstances, and (ii) was conducted
in compliance with the attestation standards of the American Institute
of Certified Public Accountants, (c) management of the Administrator
has asserted to such firm that the Administrator has complied with the
minimum servicing standards set out in Schedule 5 and (d) in the
opinion of such firm, such assertion of the Administrator's management
is fairly stated in all material respects (or, if such assertion of
the Administrator's management is not correct, stating why such
assertion is not correct).
6. No Liability
6.1 No Guarantee of Mortgage Loan: The Administrator shall have no
liability for any obligation of a Borrower under any Mortgage Loan
comprised in the Mortgage Portfolio or any Related Security and
nothing herein shall constitute a guarantee, or similar obligation, by
the Administrator of any Mortgage Loan, Mortgage or any Borrower.
6.2 No Guarantee to Mortgages Trustee or Beneficiaries: Save as otherwise
provided in this Agreement, the Administrator shall have no liability
for the obligations of the Mortgages Trustee or the Beneficiaries
under any of the Transaction Documents or otherwise and nothing herein
shall constitute a guarantee, or similar obligation, by the
Administrator of the Mortgages Trustee or the Beneficiaries in respect
of any of them.
7. New Mortgage Loans
7.1 New Mortgage Portfolio: The Mortgage Portfolio may be augmented from
time to time by the sale and assignment to the Mortgages Trustee on
any Distribution Date of a New Mortgage Portfolio by the Seller.
7.2 Sale and Assignment subject to Terms: The sale and assignment of each
New Mortgage Portfolio to the Mortgages Trustee will in all cases be
subject to the terms set out in the Mortgage Sale Agreement including,
without limitation, the conditions set out in Clause 4 (Sale and
Purchase of New Mortgage Portfolios) of the Mortgage Sale Agreement
and the representations and warranties set out in Clause 8 (Warranties
and Repurchase by the Seller) of the Mortgage Sale Agreement.
8. Product Switching and Further Advances
8.1 Acceptance of Application: The Administrator may accept an application
for a Further Advance or a Product Switch on behalf of the Seller,
upon receipt of written confirmation from the Seller that the Seller
would, if invited to do so by the Mortgages Trustee, purchase the
relevant Mortgage Loan and its Related Security from the Mortgages
Trustee.
16
8.2 Notification: Subject to complying with the terms of Clause 8.1
(Acceptance of Application) herein, where the Administrator accepts a
Product Switch or a Further Advance, the Administrator shall then
promptly notify the Seller and the Mortgages Trustee in writing.
8.3 Existing Borrowers Re-Fix Rate: Notwithstanding Clause 8.1 (Acceptance
of Application) herein, whenever Clause 8.6 (Existing Borrowers'
Re-Fix Rate) of the Mortgage Sale Agreement applies to a Fixed Rate
Mortgage Loan, the Administrator may accept the exercise of an option
by a Borrower to set the Existing Borrowers' Re-Fix Rate, subject to
the terms of Clause 4.4 (Existing Borrowers' Re-Fix Rate) herein.
8.4 Procedures: Subject to complying with the terms of Clauses 8.1
(Acceptance of Application) and 8.3 (Existing Borrowers' Re-Fix Rate)
herein, the Administrator may accept requests from Borrowers for
Product Switches and Further Advances provided that the Administrator
acts in accordance with its then procedure which would be acceptable
to a reasonable and prudent mortgage lender.
9. Redemption of Mortgages
9.1 Receipt or Discharge: Upon repayment in full of all sums secured by a
Mortgage and/or other Related Security comprised in the Mortgage
Portfolio, the Administrator shall, and is hereby authorised by the
Mortgages Trustee as trustee for the Beneficiaries to, execute a
receipt or discharge or relevant Form DS1 (of the H.M. Land Registry)
of the Mortgage and any such other or further instrument or deed of
satisfaction regarding such Mortgage and/or the Related Security as it
considers to be necessary or advisable and to release the relevant
Title Deeds to the person or persons entitled thereto.
9.2 Title Deeds: The Administrator undertakes that prior to any actual
release by it of any relevant Title Deeds it will take reasonable and
appropriate steps to satisfy itself that the relevant Title Deeds are
being released to the person or persons entitled thereto.
9.3 Payment of Sums Due: The Administrator shall procure that if, upon
completion of the Enforcement Procedures, an amount in excess of all
sums due from the relevant Borrower is recovered or received, the
balance, after discharge of all sums due from the Borrower, is paid to
the person or persons next entitled thereto.
10. Powers of Attorney
10.1 Appointment: The Mortgages Trustee hereby appoints the Administrator
as its attorney on its behalf, and in its own or the attorney's name,
for the following purposes:
(a) executing all documents necessary for the purpose of discharging
a Mortgage comprised in the Mortgage Portfolio which has been
repaid in full and any Related Security or for the sale of a
Mortgaged Property as Mortgagee;
(b) executing all documents necessary for the purpose of releasing a
Borrower in accordance with Clause 9 (Redemption of Mortgages)
herein;
17
(c) executing all documents and doing all acts and things which in
the reasonable opinion of the Administrator are necessary or
desirable for the efficient provision of the Services hereunder;
and
(d) exercising its rights, powers and discretion under the Mortgages
including the right to fix the rate of interest payable under the
Mortgage Loans or any related rights (but subject, in relation to
the right to set the interest rate under the Base Rate Pledge and
the Existing Borrowers' Re-Fix Rate, to the limitations,
conditions and qualifications set out in the Mortgage Sale
Agreement and the powers of attorney executed pursuant to it),
provided that, for the avoidance of doubt, these Powers of Attorney
shall not authorise the Administrator to sell any of the Mortgage
Loans and/or their Related Security comprised in the Mortgage
Portfolio except as specifically authorised in the Transaction
Documents. For the avoidance of doubt, neither the Mortgages Trustee
nor the Funding Beneficiaries shall be liable or responsible for the
acts of the Administrator or any failure by the Administrator to act
under or in respect of these Powers of Attorney.
10.2 Appointments Irrevocable: The appointments contained in Clause 10.1
(Appointment) herein shall be irrevocable unless and until the
Mortgages Trustee and/or the Funding Beneficiaries and the Funding
Security Trustees serve notice pursuant to Clause 19 (Termination)
herein to terminate the Administrator's appointment under this
Agreement upon which the appointments contained in Clause 10.1
(Appointment) herein shall be automatically revoked.
11. Costs and Expenses
The Mortgages Trustee will on each Distribution Date reimburse, in
accordance with Clause 10.2(b) of the Mortgages Trust Deed, the
Administrator for all out-of-pocket costs, expenses and charges
(inclusive of any amounts in respect of Irrecoverable VAT due thereon)
properly incurred by the Administrator in the performance of the
Services including any such costs, expenses or charges not reimbursed
to the Administrator on any previous Distribution Date and the
Administrator shall supply the Mortgages Trustee with an appropriate
VAT invoice issued by the person making the supply.
12. Information
12.1 Maintenance of Records:
(a) The Administrator shall keep the Mortgage Loan Files relating to
the Mortgage Portfolio in safe custody and shall take appropriate
technical and organisational measures against the unauthorised or
unlawful processing of personal data and against accidental loss
or destruction of, or damage to, personal data. The Administrator
shall maintain in an adequate form such records as are necessary
to enforce each Mortgage comprised in the Mortgage Portfolio and,
where relevant, any other Related Security. The Administrator
shall keep the Mortgage Loan Files in relation to the Mortgage
Portfolio in such a way that they can be distinguished from
information held by the
18
Administrator for its own behalf as mortgagee or heritable
creditor or for other third persons.
(b) A duplicate of any computer records held by the Administrator
which contains information relating to the Mortgage Loans and the
Related Security shall be lodged by the Administrator on a
quarterly basis in a location separate from that in which the
original computer records are stored and in an environment
conducive to the safe storage of electronic media and which
allows the information to be stored in an incorruptible form,
such records to be held to the order of the Mortgages Trustee and
to be replaced by a revised duplicate as and when the original
records are revised. The Administrator shall keep the Mortgages
Trustee informed of the location of the Mortgage Loan Files and
duplicate computer records.
12.2 Use of information technology systems:
(a) The Administrator will use all reasonable endeavours to negotiate
with the relevant parties so that any intellectual property
rights not owned by it but used by it in connection with the
performance of its obligations under this Agreement and in
particular all software programmes used in connection with the
Mortgage Loans and the Related Security therefor and their
administration are licensed or sub-licensed to the Mortgages
Trustee as trustee for the Beneficiaries so as to permit the
Mortgages Trustee as trustee for the Beneficiaries to use such
intellectual property rights only in connection with the
administration of the Mortgage Loans free of charge for so long
as any of the Mortgage Loans are outstanding. For the avoidance
of doubt, the Administrator shall not be in breach of its
obligations under this Agreement if such rights and/or software
programmes are not so licensed or sub-licensed to the Mortgages
Trustee as trustee for the Beneficiaries at any time after it has
ceased to be the Administrator:
(b) If this Agreement is terminated, then for a period of six months
following such termination (or such shorter period as may be
necessary to allow the administration of the Mortgage Loans to be
transferred to another person) the Administrator shall use
reasonable endeavours to assist the Mortgages Trustee and/or the
Beneficiaries and/or any substitute or successor Administrator
to:
(i) establish and implement a computer system for
administering the Mortgage Loans; and
(ii) load the data held by the Administrator in relation to
Borrowers and the Mortgage Loans on to such computer
system,
and, prior to (i) and (ii) having taken place, the Administrator
will provide all necessary access and assistance to the Mortgages
Trustee and/or the Beneficiaries and/or the substitute
Administrator in respect of its own intellectual property rights
in relation to the administration of the Mortgage Loans.
(c) Subject always to the restrictions and conditions set forth in
Clause 16, upon termination of the appointment of the
Administrator under this Agreement, the
19
Administrator shall forthwith deliver to the Mortgages Trustee
and/or the Beneficiaries and/or the substitute Administrator all
computer and data records in its possession or under its control
relating to the affairs of or belonging to the Mortgages Trustee
and the Beneficiaries and/or relating to the Mortgage Loans and
the Related Security in a form agreeable to each of the
Administrator, the Mortgages Trustee and/or the Beneficiaries
and/or the substitute Administrator which accords with the
standard practice of the electronic data processing industry at
the time the event occurs.
(d) The Administrator covenants that it will take no action, nor omit
to take any action, the effect or likely effect of such action or
omission will be to terminate any existing licence agreement in
relation to any such intellectual property rights, provided that
a licence agreement may be terminated if it is replaced by a
substitute arrangement under which the intellectual property
rights, including rights to computer software, are such that the
services resulting therefrom are equivalent to the previous
arrangement.
12.3 Access to Books and Records: Subject to all applicable laws, and
subject always to the restrictions and conditions set forth in Clause
16 (Data Protection), the Administrator shall permit the Mortgages
Trustee (and its auditors), each Funding Beneficiary (and their
auditors), each Funding Security Trustee and any other person
nominated by the Beneficiaries (to whom the Administrator has no
reasonable objection) upon reasonable notice during normal office
hours to have access, or procure that such person or persons are
granted access, to all books of record and account (including, for the
avoidance of doubt, the Title Deeds and Mortgage Loan Files) relating
to the administration of the Mortgage Loans and the Related Security
comprised in the Mortgage Portfolio and related matters in accordance
with this Agreement.
12.4 Information Covenants:
(a) The Administrator shall, within ten (10) Business Days following
each Payment Date, provide the Mortgages Trustee, the
Beneficiaries, the Rating Agencies, the Lead Manager, Bloomberg
L.P. (unless otherwise prohibited by law) and any other party as
the Mortgages Trustee may direct with a report in, or
substantially in, the form set out in Schedule 2 (Form of
Investors' Quarterly Report) hereto (or such other form
reasonably requested by the Mortgages Trustee and approved by the
Beneficiaries and the Rating Agencies) and shall assist the Cash
Manager in the production of quarterly reports substantially in
the forms set out in Schedule 3 of the Cash Management Agreement.
(b) The Administrator shall notify the Rating Agencies in writing of
the details of (i) any material amendment to the Transaction
Documents, (ii) any proposed material change in the valuation
procedures or policies applied or to be applied in relation to
Mortgaged Properties by it in connection with its mortgage
business (details of which change may be included in a report
provided under subparagraph (a) above) and (iii) any other
information relating to its mortgage business and financial
condition as the Rating Agencies may reasonably request in
connection with the ratings of the Notes of any Issuer and other
matters contemplated by the Transaction, provided that such
request
20
does not adversely interfere with the Administrator's day to day
provision of the Services under the other terms of this
Agreement.
(c) The Administrator shall, at the request of Funding and the
Security Trustee or Funding 2 and the Funding 2 Security Trustee
(where the Administrator is the Seller) and at the request of any
of the Beneficiaries (where the Administrator is no longer the
Seller), furnish Funding and the Security Trustee and/or Funding
2 and the Funding 2 Security Trustee and/or the Beneficiaries (as
appropriate) and the Rating Agencies with such other information
relating to its business and financial condition as it may be
reasonable for Funding and the Security Trustee and/or Funding 2
and the Funding 2 Security Trustee and/or the Beneficiaries (as
appropriate) to request in connection with the ratings of the
Notes of any Issuer and other matters contemplated by the
Transaction, provided that Funding and the Security Trustee or
Funding 2 and the Funding 2 Security Trustee or the Beneficiaries
(as is appropriate) shall not make such a request more than once
every three months unless, in the belief of Funding and the
Security Trustee or Funding 2 and the Funding 2 Security Trustee
or the Beneficiaries (as is appropriate), an Intercompany Loan
Event of Default or a Termination Event pursuant to Clause 19
(Termination) herein shall have occurred and is continuing or may
reasonably be expected to occur.
13. Remuneration
13.1 Administration Fee: The Mortgages Trustee shall pay to the
Administrator for its Services hereunder an administration fee (the
"Administration Fee") (inclusive of VAT) which:
(a) shall be calculated in relation to each Trust Calculation Period
on the basis of the number of days elapsed and a 365 day year
(or, in the case of a Trust Calculation Period ending in a leap
year, a 366 day year) at the Administration Fee Rate, inclusive
of VAT, on the aggregate amount of the Funding Share and the
Funding 2 Share of the Trust Property as at close of business of
such Trust Calculation Period; and
(b) shall be paid to the Administrator on each Distribution Date in
the manner contemplated by and in accordance with the provisions
of Clause 10 (Distribution of Revenue Receipts) of the Mortgages
Trust Deed.
13.2 Substitute or Successor Administrator: If a substitute or successor
administrator shall be appointed under this Agreement with respect to
any of the Mortgage Loans, the Mortgages Trustee shall set the
Administration Fee Rate with such substitute or successor
administrator at the time such substitute or successor administrator
enters into an administration agreement.
14. Insurances
14.1 Administration: The Administrator will administer the arrangements for
insurance to which the Mortgages Trustee is a party or in which either
the Seller or the Mortgages Trustee has an interest and which relate
to the Mortgage Loans and the Mortgages comprised in the Mortgage
Portfolio or the business of the Mortgages Trustee.
21
14.2 Action of Administrator: The Administrator shall not knowingly take or
omit to take any action which would:
(a) result in the avoidance or termination of any of the Insurance
Policies in relation to any Mortgage Loans and Mortgages to which
any Insurance Policy applies;
(b) reduce the amount payable on any claim made on behalf of the
Mortgages Trustee (as trustee for the Beneficiaries) under any
Insurance Policy; or
(c) invalidate any Insurance Policy.
14.3 Submission of Claims: The Administrator shall prepare and submit any
claim under the Insurance Policies in accordance with the requirements
of the relevant Insurance Policy and otherwise with the usual
procedures undertaken by a reasonable and prudent mortgage lender on
behalf of the Mortgages Trustee as trustee for the Beneficiaries and
shall comply with the other requirements of the insurer under the
relevant Insurance Policy.
14.4 Proceeds: The Administrator shall use its reasonable endeavours to
credit to the relevant Collection Account all proceeds received from
any claim made under each Insurance Policy in relation to any Mortgage
Loan by close of business on the London Business Day which immediately
follows the day on which such amounts are received or credited by the
Administrator (and in any event within three (3) London Business Days
of such receipt) and which is applied either in whole or in part in
repayment of a Mortgage Loan.
14.5 MIG Policies:
(a) Without prejudice to Clause 3 (The Administration Services)
herein, the Mortgages Trustee as trustee for the Beneficiaries
acknowledges that the Administrator may settle or compromise
claims on a Mortgage Loan by Mortgage Loan basis in respect of
any MIG Policy in a manner consistent with its normal practice in
respect of mortgage indemnity polices, provided that the
Administrator shall not, without the prior written consent of the
Mortgages Trustee, settle any claims or initiate any legal
proceedings or other legal process in respect of a group of class
of mortgages or in respect of the MIG Policies as a whole and
provided further that each such MIG Policy and all proceeds
thereof remain as Trust Property.
If the Enforcement Procedures require the Administrator to make a
claim under the relevant MIG Policy and the Administrator has
failed to make such a claim, then the Beneficiaries may direct
the Mortgages Trustee on their behalf to direct the Administrator
to make a claim or, in default thereof by the Administrator, the
Beneficiaries may direct the Mortgages Trustee to make a claim
itself under such policy and the Administrator shall, within ten
(10) London Business Days of receiving a written request from the
Mortgages Trustee (as trustee for the Beneficiaries), provide the
Mortgages Trustee with such information as the Mortgages Trustee
may require to enable it to make a claim under the relevant MIG
Policy.
22
(b) Without prejudice to the rights of the Administrator under Clause
14.5(b) herein, the Administrator shall, in administering the
Mortgage Loans, ensure that the cover under any MIG Policy
relating to any Mortgage is not adversely affected.
14.6 Buildings Policies:
(a) Upon receipt of notice that any Borrower whose Mortgage Loan is
secured by a mortgage of a leasehold (or, in Scotland, a standard
security of a long leasehold) Mortgaged Property has failed to
make a payment when due of any sums due under the relevant lease
in respect of the insurance of the property, the Administrator
may debit such Borrower's account with the relevant amount which
shall then be paid to the relevant landlord.
(b) If the Administrator becomes aware that a Borrower has failed to
pay premiums due under any Buildings Policy, the Administrator
shall take such action as would a reasonable and prudent mortgage
lender with a view to ensuring that the relevant Mortgaged
Property continues to be insured in accordance with the
applicable Mortgage Terms or the Alternative Insurance
Requirements.
14.7 Life Policies:
(a) The Administrator shall use its reasonable endeavours to ensure
that upon maturity of a Life Policy or on the death of a
Borrower, if earlier, all sums which it is agreed between the
Seller and the relevant Borrower are due to be paid under the
Life Policy are paid by the relevant insurance company in
repayment of the Mortgage for which such Life Policy is
collateral security and credited to the relevant Collection
Account.
(b) If so requested by a Borrower the Administrator may, on behalf of
the Beneficiaries, exercise its discretion as a reasonable and
prudent mortgage lender to agree to the release of a Life Policy
from the relevant legal or equitable charge granted by the
related Borrower in favour of the Seller.
15. Title Deeds
15.1 Custody: The Administrator shall keep the Title Deeds relating to the
Mortgage Portfolio in safe custody and shall not without the prior
written consent of the Mortgages Trustee and the Beneficiaries part
with possession, custody or control of them otherwise than to a
sub-contractor or delegate appointed pursuant to Clause 3.2
(Sub-Contracts) herein or to a solicitor, licensed or qualified
conveyancer or authorised practitioner, subject to the usual
undertaking to hold them to the order of the Seller (who in turn will
hold them to the order of the Mortgages Trustee (as trustee for the
Beneficiaries)) or to H.M. Land Registry or the Registers of Scotland
or, upon redemption of the relevant Mortgage Loan, to the order of the
Borrower.
15.2 Identification: The Title Deeds relating to the Mortgage Portfolio
shall be kept in a manner such that a computer record is maintained of
their location and they are identifiable and retrievable by reference
to an account number and pool identifier and identifiable and
distinguishable from the title deeds relating to other properties and
23
mortgages in respect of which the Administrator is mortgagee or
heritable creditor or administrator.
15.3 Access: The Administrator shall provide access, or procure that access
is provided to, the Title Deeds relating to the Mortgage Portfolio to
the Mortgages Trustee, the Beneficiaries and their respective agents
at all reasonable times and upon reasonable notice. The Administrator
acknowledges that the Title Deeds and Mortgage Loan Files relating to
the Mortgage Portfolio in its possession, custody or control will be
held to the order of the Mortgages Trustee (as trustee for the
Beneficiaries) and that it has, in its capacity as Administrator, no
beneficial interest therein and the Administrator (in its capacity as
such but not in its capacity as a Beneficiary) irrevocably waives any
rights or any Security Interest which it might have therein or to
which it might at any time be entitled.
15.4 Delivery upon Termination: The Administrator shall, forthwith on the
termination of the appointment of the Administrator pursuant to Clause
19 (Termination) herein, deliver the Title Deeds and Mortgage Loan
Files to or to the order of the Mortgages Trustee or to such person as
the Mortgages Trustee elects as a substitute administrator in
accordance with the terms of this Agreement upon written request by
the Mortgages Trustee made at any time on or after notice of, or on or
after, termination of the appointment of the Administrator pursuant to
Clause 19 (Termination) herein.
16. Data Protection
The Administrator represents that as at the date hereof the
Administrator has and hereafter it will maintain on behalf of itself
and on behalf of the Mortgages Trustee (as trustee for the
Beneficiaries) all appropriate registrations, licences and authorities
(if any) required under the Data Protection Xxx 0000 to enable each of
them to perform their respective obligations under this Agreement. In
addition to the foregoing and notwithstanding any of the other
provisions of this Agreement, each of the Administrator and the
Mortgages Trustee hereby agree and covenant as follows:
(a) that only non-"personal data" (as described in the Data
Protection Act 1998) may be transferred by the Administrator to
the Mortgages Trustee or any other entity located in Jersey
(unless Jersey is declared an "approved state" by the European
Commission, in which case the Administrator may transfer such
personal data to the Mortgages Trustee in Jersey);
(b) that, to the extent that circumstances enable the Mortgages
Trustee to exercise its right to demand that the Administrator
transfer inter alia personal data to the Mortgages Trustee, the
Administrator shall only transfer such personal data to an agent
of the Mortgages Trustee that is located in the United Kingdom
and maintains all appropriate registrations, licences and
authorities (if any) required under the Data Protection Xxx 0000
(unless Jersey is declared an "approved state" by the European
Commission, in which case the Administrator may transfer such
personal data to the Mortgages Trustee in Jersey);
(c) that, to the extent that circumstances enable the Mortgages
Trustee to exercise its right to demand that the Administrator
transfer inter alia personal data to the Mortgages Trustee, the
Administrator notify each Borrower that the
24
Mortgages Trustee is a "data controller" (as defined in the Data
Protection Act 1998) and provide each such Borrower with the
address of the Mortgages Trustee;
(d) that the Administrator and the Mortgages Trustee will only use
any data in relation to the Mortgage Loans and the related
Borrowers for the purposes of administering and/or managing the
Mortgage Portfolio, and will not sell such data to any third
party or allow any third party to use such data other than in
compliance with the conditions stated in this Clause 16 and for
the sole purpose of administering and/or managing the Mortgage
Portfolio;
(e) that the Mortgages Trustee will comply with the provisions of the
Data Protection (Jersey) Law 1987 (as amended) and (so long as
the provisions of the Data Protection Xxx 0000 do not conflict
with the provisions of the Data Protection (Jersey) Law 1987)
with the provisions of the Data Protection Act 1998 (as amended);
(f) that, upon the request of a Borrower, the Administrator will
inform such Borrower that both the Administrator and the
Mortgages Trustee are "data controllers" as described in the Data
Protection Xxx 0000; and
(g) that both the Administrator and the Mortgages Trustee shall
maintain a written record of their reasons for applying the Data
Protection Order 2000 (as set forth under the Conditions under
paragraph 3 of Part II of Schedule I of such Order).
17. Covenants and Representations and Warranties of Administrator
17.1 Covenants: The Administrator hereby covenants with and undertakes to
the Mortgages Trustee, each Beneficiary and each Funding Security
Trustee that, without prejudice to any of its specific obligations
hereunder, it will:
(a) administer the Mortgage Loans and their Related Security as if
the same had not been sold and assigned to the Mortgages Trustee
but had remained on the books of the Seller;
(b) provide the Services in such manner and with the same level of
skill, care and diligence as would a reasonable and prudent
mortgage lender;
(c) comply with any reasonable directions, orders and instructions
which the Mortgages Trustee or the Beneficiaries may from time to
time give to it in accordance with the provisions of this
Agreement and, in the event of any conflict, those of the
Mortgages Trustee shall prevail;
(d) keep in force all licences, approvals, authorisations,
permissions and consents which may be necessary in connection
with the performance of the Services and prepare and submit all
necessary applications and requests for any further approval,
authorisation, consent or licence required in connection with the
performance of the Services and in particular any necessary
registrations under the Data Protection Xxx 0000;
25
(e) not knowingly fail to comply with any legal requirements in the
performance of the Services;
(f) make all payments required to be made by it pursuant to this
Agreement on the due date for payment thereof in pounds sterling
(or as otherwise required under the Transaction Documents) in
immediately available funds for value on such day without set-off
(including, without limitation, any fees owed to it) or
counterclaim, but subject to any deductions required by law;
(g) not without the prior written consent of the Mortgages Trustee
amend or terminate any of the Transaction Documents save in
accordance with their terms;
(h) forthwith upon becoming aware of any event which may reasonably
give rise to an obligation of the Seller to repurchase any
Mortgage Loan pursuant to Clause 8 (Warranties and Repurchase by
the Seller) of the Mortgage Sale Agreement, notify the Mortgages
Trustee and the Beneficiaries in writing of such event;
17.2 Covenants to Survive: The covenants of the Administrator in Clause
17.1 (Covenants) herein shall remain in force until this Agreement is
terminated but without prejudice to any right or remedy of the
Mortgages Trustee and/or the Seller and/or each Funding Beneficiary
arising from breach of any such covenant prior to the date of
termination of this Agreement.
17.3 Representations and Warranties: The Administrator hereby makes the
representations and warranties to the Mortgages Trustee, each
Beneficiary and each Funding Security Trustee that are specified on
Schedule 3 (Administrator Representations and Warranties) hereto.
18. Services Non-exclusive
Nothing in this Agreement shall prevent the Administrator from
rendering or performing services similar to those provided for in this
Agreement to or for itself or other persons or from carrying on
business similar to or in competition with the business of the
Mortgages Trustee and the Beneficiaries.
19. Termination
19.1 Termination Event: If any of the following events (each a "Termination
Event") shall occur:
(a) default is made by the Administrator in the payment on the due
date of any payment due and payable by it under this Agreement
and such default continues unremedied for a period of five London
Business Days after the Administrator becoming aware of such
default;
(b) default is made by the Administrator in the performance or
observance of any of its other covenants and material obligations
under this Agreement or any of the other Transaction Documents,
where:
26
(i) the Security Trustee, having been informed thereof in
accordance with Clause 19.5 (Notification of Termination
Event), is of the opinion that such default is materially
prejudicial to the interests of the holders of the Notes
issued by the Funding Issuers and then outstanding; and/or
(ii) the Funding 2 Security Trustee, having been informed
thereof in accordance with Clause 19.5 (Notification of
Termination Event), is of the opinion that such default is
materially prejudicial to the interests of the holders of
the Notes issued by the Funding 2 Issuers and then
outstanding,
and such default continues unremedied for a period of twenty (20)
days after the Administrator becoming aware of such default,
provided however that where the relevant default occurs as a
result of a default by any person to whom the Administrator has
sub-contracted or delegated part of its obligations hereunder,
such default shall not constitute a Termination Event if within
such twenty (20) day period the Administrator replaces the
relevant sub-contractor or delegate with an entity capable of
remedying such default or alternatively indemnifies the Mortgages
Trustee and the Beneficiaries against the consequences of such
default;
(c) the Administrator at any time fails to obtain or maintain the
necessary license or regulatory approval required by any UK
mortgage or credit regulatory regime which would be required in
order to enable it to continue administering the Mortgage Loans;
or
(d) the Administrator becomes subject to an Insolvency Event,
then the Mortgages Trustee and/or Funding and the Security Trustee
and/or Funding 2 and the Funding 2 Security Trustee may at once or at
any time thereafter while such default continues, by notice in writing
to the Administrator, terminate its appointment as Administrator under
this Agreement with effect from a date (not earlier than the date of
the notice) specified in such notice. Upon termination of the
appointment of the Administrator, the Funding Security Trustees shall
use their reasonable endeavours (subject to the terms of the Funding
Beneficiary Deed) to appoint a substitute Administrator that satisfies
the conditions set forth in Clause 19.2(c), (d) and (e), provided that
in the event the Funding Security Trustees have not, having used
reasonable endeavours (subject to the terms of the Funding Beneficiary
Deed) appointed a substitute Administrator, they shall have no
liability to any person and, notwithstanding any other provision of
the Transaction Documents, shall not themselves be required to perform
any duties of the Administrator.
19.2 Resignation: The Administrator may resign under this Agreement at any
time following the expiry of not less than 12 months' notice of
resignation given by the Administrator to the Mortgages Trustee and
the Beneficiaries provided that:
(a) the Mortgages Trustee and the Beneficiaries consent in writing to
such termination;
(b) a substitute administrator is appointed by the Mortgages Trustee,
the Funding Beneficiaries and the Funding Security Trustees (and
in the event of failure to
27
agree, by the Funding Security Trustees), such appointment to be
effective not later than the date of such termination (and the
Administrator shall notify the Rating Agencies in writing of the
identity of such substitute administrator);
(c) if required to be qualified to act as administrator under the
FSMA, such substitute administrator is so qualified;
(d) if possible, such substitute administrator has experience of
administering mortgages of residential property in England, Wales
and Scotland and, in any event (in so far as is required by any
applicable laws and regulations) has all authorisations,
permissions and licences for the purposes of administering
mortgages of residential property in England, Wales and Scotland;
(e) such substitute administrator enters into an agreement on
substantially the same terms as the relevant provisions of this
Agreement and the Administrator shall not be released from its
obligations under the relevant provisions of this Agreement until
such substitute administrator has entered into such new
agreement; and
(f) the then current ratings (if any) of the Notes of any Issuer are
not reduced, withdrawn or qualified as a result thereof, unless
otherwise agreed by an Extraordinary Resolution (as defined in
the applicable Note Trust Deed) of the holders of the relevant
class or classes of Notes.
19.3 Termination of Authority: On and after resignation by, or termination
of the appointment of, the Administrator under this Agreement pursuant
to this Clause 19, all authority and power of the Administrator under
this Agreement shall be terminated and be of no further effect and the
Administrator shall not thereafter hold itself out in any way as the
agent of the Mortgages Trustee and/or the Beneficiaries pursuant to
this Agreement.
19.4 Delivery of Files: Upon resignation by, or termination of the
appointment of, the Administrator under this Agreement pursuant to
this Clause 19, the Administrator shall:
(a) forthwith deliver to (and in the meantime hold on trust for, and
to the order of) the Mortgages Trustee or as it shall direct the
Mortgage Loan Files, the Title Deeds, all books of account,
papers, records, registers, correspondence and documents in its
possession or under its control relating to the affairs of, or
belonging to, the Mortgages Trustee (as trustee for the
Beneficiaries) and the Mortgages in the Mortgage Portfolio and
any other Related Security, (if practicable, on the date of
receipt) any monies then held by the Administrator on behalf of
the Mortgages Trustee and any other assets of the Mortgages
Trustee as trustee for the Beneficiaries;
(b) take such further action as the Mortgages Trustee, the Funding
Beneficiaries and the Funding Security Trustees may reasonably
direct at the expense of the Beneficiaries (including in relation
to the appointment of a substitute administrator) provided that
neither the Mortgages Trustee nor each Funding Security Trustee
shall be required to take or direct to be taken such further
action unless it has been indemnified to its satisfaction;
28
(c) provide all relevant information contained on computer records in
the form of magnetic tape, together with details of the layout of
the files encoded on such magnetic tapes; and
(d) co-operate and consult with and assist the Mortgages Trustee,
each Funding Beneficiary, each Funding Security Trustee and their
nominees (which shall, for the avoidance of doubt, include any
new administrator appointed by any of them) for the purposes of
explaining the file layouts and the format of the magnetic tapes
generally containing such computer records on the computer system
of the Mortgages Trustee or such nominee.
19.5 Notification of Termination Event: The Administrator shall notify the
Mortgages Trustee, each Funding Security Trustee and each Beneficiary
as soon as reasonably practicable but in any event within five (5)
days of becoming aware of any Termination Event or any event which
with the giving of notice or lapse of time or certification would
constitute the same. Such notification shall specify which event in
Clause 19 (Termination) occurred and was the cause of such Termination
Event (or any event which with the giving of notice or lapse of time
or certification would constitute a Termination Event), a description
of the details of such Termination Event, and a reference to the
provision in this Agreement or the other Transaction Documents which
the Administrator has breached.
19.6 No Prejudice: Termination of this Agreement or the appointment of the
Administrator under this Agreement shall be without prejudice to the
liabilities of the Mortgages Trustee as trustee for the Beneficiaries
to the Administrator or vice versa incurred before the date of such
termination. The Administrator shall have no right of set-off or any
lien in respect of such amounts against amounts held by it on behalf
of the Mortgages Trustee.
19.7 Automatic Termination: This Agreement shall terminate at such time as
the Mortgages Trustee has no further interest in any of the Mortgage
Loans or the Mortgages which have been comprised in the Mortgage
Portfolio.
19.8 Further Compensation: Upon resignation by, or termination of the
appointment of, the Administrator under the provisions of this Clause
19, the Administrator shall be entitled to receive all fees and other
monies accrued up to the date of resignation or termination, as the
case may be, but shall not be entitled to any other or further
compensation. Such monies so receivable by the Administrator shall be
paid by the Mortgages Trustee on the dates on which they would
otherwise have fallen due hereunder. For the avoidance of doubt, such
resignation or termination shall not affect the Administrator's rights
to receive payment of all amounts (if any) due to it from the
Mortgages Trustee other than under this Agreement.
19.9 Co-operation: Prior to termination of this Agreement, the
Administrator, the Seller, the Mortgages Trustee and the Funding
Beneficiaries shall co-operate to obtain the agreement of the
Borrowers to a new bank mandate permitting the Mortgages Trustee to
operate the Direct Debiting Scheme.
19.10 Survival of Terms: Any provision of this Agreement which is stated to
continue after termination of the Agreement shall remain in full force
and effect notwithstanding termination.
29
19.11 No Supervision: Neither Funding Security Trustee shall be obliged to
monitor or supervise the performance by any substitute Administrator
of its duties hereunder or in relation to the other Transaction
Documents, nor shall the Funding Security Trustees be responsible or
liable for any act or omission of such substitute Administrator or for
any loss caused thereby.
20. Further Assurances
20.1 Co-operation: The parties hereto agree that they will co-operate fully
to do all such further acts and things and execute any further
documents as may be necessary or desirable to give full effect to the
arrangements contemplated by this Agreement.
20.2 Powers of Attorney: Without prejudice to the generality of Clause 20.1
(Co-Operation) herein, the Mortgages Trustee as trustee for the
Beneficiaries shall upon request by the Administrator forthwith give
to the Administrator such further powers of attorney or other written
authorisations, mandates or instruments as are necessary to enable the
Administrator to perform the Services.
20.3 Notice to Rating Agencies: In the event that there is any change in
the identity of the Mortgages Trustee or an additional Mortgages
Trustee is appointed, the remaining Mortgages Trustee and/or the
retiring Mortgages Trustee, as the case may be, shall execute such
documents with any other parties to this Agreement and take such
actions as such new Mortgages Trustee may reasonably require for the
purposes of vesting in such new Mortgages Trustee the rights of the
Mortgages Trustee under this Agreement and releasing the retiring
Mortgages Trustee from further obligations thereunder and while any
Note remains outstanding shall give notice thereof to the Rating
Agencies.
20.4 No Obligations: Nothing herein contained shall impose any obligation
or liability on the Mortgages Trustee to assume or perform any of the
obligations of the Administrator hereunder or render it liable for any
breach hereof.
21. Miscellaneous
21.1 Insufficient Funds: Subject to Clause 21.2 (Reduction of Fees) herein,
in the event that the funds available to the Mortgages Trustee on any
Payment Date are not sufficient to satisfy in full the aggregate
amount payable to the Administrator by the Mortgages Trustee on such
Payment Date then the amount payable to the Administrator on such
Payment Date shall be reduced by the amount of the shortfall and such
shortfall shall (subject always to the provisions of this Clause 21)
be payable on the immediately succeeding Payment Date.
21.2 Reduction of Fees: In the event that:
(a) after redemption in full of the Intercompany Loans; or
(b) after service of an Intercompany Loan Enforcement Notice and
payment of all other prior claims,
the remaining sums available to the Mortgages Trustee or remaining
proceeds of enforcement are insufficient to satisfy in full the
outstanding fees or other claims of the Administrator, such fees shall
be reduced by the amount of the deficiency.
30
21.3 Set-Off: Each of the Seller and the Administrator agrees that it will
not:
(a) set off or purport to set off any amount which the Mortgages
Trustee, each Funding Beneficiary or each Issuer is or will
become obliged to pay to it under any of the Transaction
Documents against any amount from time to time standing to the
credit of or to be credited to any Collection Account, any
Mortgages Trustee Bank Account, any Funding Bank Account, any
Funding 2 Bank Account, any Issuer Transaction Account or in any
other account prior to transfer to any Collection Account, any
Mortgages Trustee Bank Account, any Funding Bank Account, any
Funding 2 Bank Account or any Issuer Transaction Account, as
appropriate; or
(b) make or exercise any claims or demands, any rights of
counterclaim or any other equities against or withhold payment of
any and all sums of money which may at any time and from time to
time be standing to the credit of any Collection Account, any
Mortgages Trustee Bank Account, any Funding Bank Account, any
Funding 2 Bank Account or any Issuer Transaction Account.
21.4 No Petition: The Administrator agrees that for so long as any Notes of
any Issuer are outstanding it will not petition nor commence
proceedings for the administration or winding up of the Mortgages
Trustee, any Funding Beneficiary or any Issuer nor participate in any
ex parte proceedings with regard thereto.
21.5 Limited Recourse: In relation to all sums due and payable by the
Mortgages Trustee to the Administrator, the Administrator agrees that
it shall have recourse only to sums paid to or received by (or on
behalf of) the Mortgages Trustee pursuant to the provisions of the
Mortgage Sale Agreement, the other Transaction Documents and in
relation to the Mortgages.
21.6 No Prejudice: For the avoidance of doubt, no Beneficiary shall be
liable to pay any amounts due under Clauses 11 (Costs and Expenses) or
13 (Remuneration) herein without prejudice to the obligations of the
Mortgages Trustee in respect of such amounts.
21.7 Termination: Notwithstanding any other provisions of this Agreement:
(a) all obligations to, and rights of, Funding under or in connection
with this Agreement (other than its obligations under Clause 22
(Confidentiality) herein) shall automatically terminate upon the
discharge in full of all amounts owing by it under any Funding
Intercompany Loan Agreement, provided that this shall be without
prejudice to any claims in respect of such obligations and rights
arising on or prior to such date; and
(b) all obligations to, and rights of, Funding 2 under or in
connection with this Agreement (other than its obligations under
Clause 22 (Confidentiality) herein) shall automatically terminate
upon the discharge in full of all amounts owing by it under any
Funding 2 Intercompany Loan Agreement provided that this shall be
without prejudice to any claims in respect of such obligations
and rights arising on or prior to such date.
31
22. Confidentiality
From the date of this Agreement and notwithstanding its termination,
each of the Mortgages Trustee and the Beneficiaries shall use its best
endeavours not to disclose to any person whatsoever any information
relating to the business, finances or other matters of a confidential
nature of any other party hereto of which it may by virtue of being
party to the Transaction Documents have become possessed and shall use
all reasonable endeavours to prevent any such disclosure as aforesaid,
provided however that the provisions of this Clause 22 shall not
apply:
(a) to any information already known to the Mortgages Trustee or the
Beneficiaries otherwise than as a result of entering into any of
the Transaction Documents;
(b) to any information subsequently received by the Mortgages Trustee
or the Beneficiaries which it would otherwise be free to
disclose;
(c) to any information which is or becomes public knowledge otherwise
than as a result of the conduct of the Mortgages Trustee or the
Beneficiaries;
(d) to the extent that any of the Mortgages Trustee or the
Beneficiaries is required to disclose the same pursuant to any
Transaction Document, pursuant to any law or order of any court
or pursuant to any direction, request or requirement (whether or
not having the force of law) of any central bank or any
governmental or other authority (including, without limitation,
any official bank examiners or regulators);
(e) to the extent that any of the Mortgages Trustee or the
Beneficiaries needs to disclose the same for determining the
existence of, or declaring, an Intercompany Loan Event of Default
or a Termination Event, the protection or enforcement of any of
its rights under any of the Transaction Documents or in
connection herewith or therewith or for the purpose of
discharging, in such manner as it thinks fit, its duties under or
in connection with such agreements in each case to such persons
as require to be informed of such information for such purposes;
or
(f) in relation to any information disclosed to the professional
advisers of the Mortgages Trustee or the Beneficiaries or (in
connection with the review of current ratings of the Notes of any
Issuer or with a prospective rating of any debt to be issued by
an Issuer) to any credit rating agency or any prospective new
Administrator or Mortgages Trustee.
23. No Partnership
It is hereby acknowledged and agreed by the parties that nothing in
this Agreement shall be construed as giving rise to any partnership
between any of the parties.
24. Assignment
24.1 Consent: The Mortgages Trustee may not assign or transfer any of its
rights and obligations under this Agreement without the prior written
consent of each of the Beneficiaries.
32
24.2 Agreement: The Administrator may not assign or transfer any of its
rights or obligations under this Agreement (a) without the prior
written consent of the Mortgages Trustee (as trustee for the
Beneficiaries) and each of the Beneficiaries and (b) other than to a
person who agrees to be bound by the provisions contained in Clause 5
of the Funding Deed of Charge and Clause [o] of the Funding 2 Deed of
Charge as if such person had been named as an original party thereto
in place of Northern Rock but without prejudice to their obligations
under such Clause.
24.3 Assignment of Rights to Security Trustee: The Administrator
acknowledges that Funding has assigned its rights under this Agreement
to the Security Trustee pursuant to the Funding Deed of Charge and
acknowledges that pursuant to the terms of the Funding Deed of Charge,
Funding has, inter alia, authorised the Security Trustee, following
the Funding Security becoming enforceable, to exercise, or refrain
from exercising, all of Funding's rights, powers, authorities,
discretions and remedies under or in respect of the Funding
Transaction Documents, including this Agreement, in such manner as in
the Security Trustee's absolute discretion it shall think fit.
24.4 Assignment of Rights to Funding 2 Security Trustee: The Administrator
acknowledges that Funding 2 has assigned its rights under this
Agreement to the Funding 2 Security Trustee pursuant to the Funding 2
Deed of Charge and acknowledges that pursuant to the terms of the
Funding 2 Deed of Charge, Funding 2 has, inter alia, authorised the
Funding 2 Security Trustee, following the Funding 2 Security becoming
enforceable, to exercise, or refrain from exercising, all of Funding
2's rights, powers, authorities, discretions and remedies under or in
respect of the Funding 2 Transaction Documents, including this
Agreement, in such manner as in the Funding 2 Security Trustee's
absolute discretion it shall think fit.
25. Security Trustee; Authorised Third Party
25.1 Vesting of Rights: If there is any change in the identity of the
security trustee in accordance with the Funding Deed of Charge, the
Administrator, the Seller, each Funding Beneficiary, the Funding 2
Security Trustee and the Mortgages Trustee shall execute such
documents and take such action as the successor security trustee and
the outgoing security trustee may reasonably require for the purpose
of vesting in the successor security trustee the rights and
obligations of the outgoing security trustee under this Agreement and
releasing the outgoing security trustee from its future obligations
under this Agreement. If there is any change in the identity of the
security trustee in accordance with the Funding 2 Deed of Charge, the
Administrator, the Seller, each Funding Beneficiary, the Security
Trustee and the Mortgages Trustee shall execute such documents and
take such action as the successor security trustee and the outgoing
security trustee may reasonably require for the purpose of vesting in
the successor security trustee the rights and obligations of the
outgoing security trustee under this Agreement and releasing the
outgoing security trustee from its future obligations under this
Agreement.
25.2 No Assumption: It is hereby acknowledged and agreed that by its
execution of this Agreement, each Funding Security Trustee shall not
assume or have any of the obligations or liabilities of the
Administrator, the Seller, each Funding Beneficiary, the Mortgages
Trustee or the other Funding Security Trustee under this Agreement.
Furthermore, any liberty or power which may be exercised or any
determination which may be made hereunder by each Funding Security
Trustee may, subject to the
33
terms of the Funding Beneficiary Deed:
(a) in relation to the Security Trustee, be exercised or made in the
Security Trustee's absolute discretion without any obligation to
give reasons therefor, but in any event must be exercised or made
in accordance with the provisions of the Funding Deed of Charge
and Schedule 4 (Authorised Third Party) hereto;
(b) in relation to the Funding 2 Security Trustee, be exercised or
made in the Funding 2 Security Trustee's absolute discretion
without any obligation to give reasons therefor, but in any event
must be exercised or made in accordance with the provisions of
the Funding 2 Deed of Charge and Schedule 4 (Authorised Third
Party) hereto.
25.3 Delegation: Each Funding Security Trustee may delegate the performance
of all or any of its powers and obligations under all or any of the
Operating Agreements pursuant to the terms of Schedule 4 (Authorised
Third Party) of this Agreement and subject always to the provisions of
the Funding Deed of Charge or the Funding 2 Deed of Charge (as
applicable) and the Funding Beneficiary Deed.
26. New Intercompany Loan Agreements
On each occasion that a Funding Beneficiary enters into an
Intercompany Loan Agreement or is the recipient of a loan advance
under an Intercompany Loan Agreement, then the Administrator, the
Seller, each Funding Beneficiary, each Funding Security Trustee and
the Mortgages Trustee shall execute such documents and take such
action as may be necessary or required by the Rating Agencies for the
purpose of including the relevant Issuer, any Swap Provider, any
Start-up Loan Provider and any other person who has executed an
Accession Undertaking or any such Intercompany Loan Agreement in the
Transaction Documents.
27. Non Petition Covenant; Limited Recourse
27.1 Non Petition Covenant: Each of the parties hereto hereby agrees that
it shall not institute against any Funding Beneficiary or the
Mortgages Trustee any winding-up, administration, insolvency or
similar proceedings so long as any sum is outstanding under any
Intercompany Loan Agreement of any Issuer or for two years plus one
day since the last day on which any such sum was outstanding.
27.2 Limited Recourse: Each of the parties hereto agrees that:
(a) in relation to the Mortgages Trustee, any amount payable by the
Mortgages Trustee to any other party to this Agreement under this
Agreement not being an amount payable out of the Trust Property
in accordance with the terms of the Mortgages Trust Deed shall
only be payable to the extent that on that date the Mortgages
Trustee has sufficient funds to pay such amount out of fees paid
to it under the Mortgages Trust Deed; and
(b) in relation to Funding:
34
(i) only the Security Trustee may enforce the security created
in favour of the Security Trustee under the Funding Deed
of Charge in accordance with the provisions thereof;
(ii) notwithstanding any other provision of this Agreement or
any other Transaction Document, no sum due or owing to any
party to this Agreement from or by Funding under this
Agreement shall be payable by Funding except to the extent
that Funding has sufficient funds available or (following
enforcement of the Funding Security) the Security Trustee
has realised sufficient funds from the Funding Security to
pay such sum subject to and in accordance with the
relevant Funding Priority of Payments and provided that
all liabilities of Funding required to be paid in priority
thereto or pari passu therewith pursuant to such Funding
Priority of Payments have been paid, discharged and/or
otherwise provided for in full; and
(iii) it shall not take any steps for the purpose of recovering
any amount payable by Funding or enforcing any rights
arising out of this Agreement against Funding otherwise
than in accordance with the Funding Deed of Charge.
(c) in relation to Funding 2:
(i) only the Funding 2 Security Trustee may enforce the
security created in favour of the Funding 2 Security
Trustee under the Funding 2 Deed of Charge in accordance
with the provisions thereof;
(ii) notwithstanding any other provision of this Agreement or
any other Transaction Document, no sum due or owing to any
party to this Agreement from or by Funding 2 under this
Agreement shall be payable by Funding 2 except to the
extent that Funding 2 has sufficient funds available or
(following enforcement of the Funding 2 Security) the
Funding 2 Security Trustee has realised sufficient funds
from the Funding 2 Security to pay such sum subject to and
in accordance with the relevant Funding 2 Priority of
Payments and provided that all liabilities of Funding 2
required to be paid in priority thereto or pari passu
therewith pursuant to such Funding 2 Priority of Payments
have been paid, discharged and/or otherwise provided for
in full; and
(iii) it shall not take any steps for the purpose of recovering
any amount payable by Funding 2 or enforcing any rights
arising out of this Agreement against Funding 2 otherwise
than in accordance with the Funding 2 Deed of Charge.
27.3 Corporate Obligations: To the extent permitted by law, no recourse
under any obligation, covenant, or agreement of any person contained
in this Agreement shall be had against any shareholder, officer or
director of such person as such, by the enforcement of any assessment
or by any legal proceeding, by virtue of any statute or otherwise; it
being expressly agreed and understood that this Agreement is a
corporate obligation of each person expressed to be a party hereto and
no personal liability shall attach to or be incurred by the
shareholders, officers, agents or directors of such
35
person as such, or any of them, under or by reason of any of the
obligations, covenants or agreements of such person contained in this
Agreement, or implied therefrom, and that any and all personal
liability for breaches by such person of any of such obligations,
covenants or agreements, either under any applicable law or by statute
or constitution, of every such shareholder, officer, agent or director
is hereby expressly waived by each person expressed to be a party
hereto as a condition of and consideration for the execution of this
Agreement.
28. Amendments and Waiver
28.1 Entire Agreement: This Agreement sets out the entire agreement and
understanding between the parties with respect to the subject matter
of this Agreement superseding all prior oral or written understandings
other than the other Transaction Documents.
28.2 Amendments and Waiver: No amendment or waiver of any provision of this
Agreement nor consent to any departure by any of the parties therefrom
shall in any event be effective unless the same shall be in writing
and signed by each of the parties hereto. In the case of a waiver or
consent, such waiver or consent shall be effective only in the
specific instance and as against the party or parties giving it for
the specific purpose for which it is given.
28.3 Rights Cumulative: The respective rights of each of the parties to
this Agreement are cumulative and may be exercised as often as they
consider appropriate. No failure on the part of any party to exercise,
and no delay in exercising, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such
right preclude any other or further exercise thereof or the exercise
of any other right. The remedies in this Agreement are cumulative and
not exclusive of any remedies provided by law.
28.4 Variation or Waiver: No variation or waiver of this Agreement shall be
made if the same would adversely affect the then current ratings of
any of the Notes.
29. Notices
Any notices or other communication or document to be given or
delivered pursuant to this Agreement to any of the parties hereto
shall be sufficiently served if sent by prepaid first class post, by
hand or by facsimile transmission and shall be deemed to be given (in
the case of facsimile transmission) when despatched or (where
delivered by hand) on the day of delivery if delivered before 17.00
hours on a London Business Day or on the next London Business Day if
delivered thereafter or (in the case of first class post) when it
would be received in the ordinary course of the post and shall be
sent:
(a) in the case of the Administrator and the Seller, to Northern Rock
PLC, Northern Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX
(facsimile number: 0191 213 2203) for the attention of the Group
Secretary;
(b) in the case of the Mortgages Trustee, to Granite Finance Trustees
Limited, c/o 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX,
Channel Islands (facsimile number 01534 609 333) for the
attention of the Company Secretary;
36
(c) in the case of Funding, to Granite Finance Funding Limited, 00
Xxxx Xxxx, Xxxxxxx XX0 0XX (facsimile number 020 8409 8911) for
the attention of the Company Secretary;
(d) in the case of the Security Trustee, to The Bank of New York,
00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile number
020 7964 6399) for the attention of Corporate Trust (Global
Structured Finance);
(e) in the case of Funding 2, to Granite Finance Funding 2 Limited at
Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx, XX0X 0XX (facsimile number
020 7606 0643) for the attention of the Company Secretary (with a
copy to the Seller in accordance with (a) above);
(f) in the case of the Funding 2 Security Trustee, to The Bank of New
York, 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx, X00 0XX (facsimile
number 020 7964 6399) for the attention of Global Structured
Finance (Corporate Trust);
(g) in the case of Fitch, to Fitch Ratings Ltd., at Xxxxx Xxxxx, 0
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 0207 7417 6262)
for the attention of European Structured Finance Surveillance;
(h) in the case of Moody's, to Xxxxx'x Investors Services, Inc., at
1st Floor, 0 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxxxxx XX0X 0XX
(facsimile number 020 7772 5400) for the attention of Xxxx xxx
Xxxxx;
(i) in the case of S&P, to Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., at Xxxxxx Xxxxx, 00
Xxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 020 7826 3598)
for the attention of Xxxxx Xxxxxxxx;
or to such other address or facsimile number or for the attention of
such other person or entity as may from time to time be notified by
any party or by any Rating Agency to the others by written notice in
accordance with the provisions of this Clause 29. All notices served
under this Agreement shall be simultaneously copied to each Funding
Security Trustee by the person serving the same.
30. Third Party Rights
A person who is not a party to this Agreement may not enforce any of
its terms under the Contracts (Rights of Third Parties) Xxx 0000, but
this shall not affect any right or remedy of a third party which
exists or is available apart from that Act.
31. Execution in Counterparts; Severability
31.1 Counterparts: This Agreement may be executed in any number of
counterparts (manually or by facsimile) and by 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 instrument.
31.2 Severability: Where any provision in or obligation under this
Agreement shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the
remaining provisions or obligations under this Agreement, or of
37
such provision or obligation in any other jurisdiction, shall not be
affected or impaired thereby.
32. Governing Law and Submission to Jurisdiction
32.1 Governing Law: This Agreement is governed by, and shall be construed
in accordance with, English law.
32.2 Submission to Jurisdiction: Each of the parties hereto irrevocably
agrees that the courts of England shall have jurisdiction to hear and
determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and, for
such purposes, irrevocably submits to the jurisdiction of such courts.
33. Process Agent
The Mortgages Trustee irrevocably and unconditionally appoints Mourant
& Co. Capital (SPV) Limited at 0 Xxxxx Xxxx Xxxxx, Xxxxxx, XX0X 0XX or
otherwise at its registered office for the time being as its agent for
service of process in England in respect of any proceedings in respect
of this Agreement and undertakes that in the event of Mourant & Co.
Capital (SPV) Limited ceasing so to act it will appoint another person
with a registered office in London as its agent for service of
process.
34. Appropriate Forum
Each of the parties hereto irrevocably waives any objection which it
might now or hereafter have to the courts of England being nominated
as the forum to hear and determine any Proceedings and to settle any
disputes, and agrees not to claim that any such court is not a
convenient or appropriate forum.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed as a
deed the day and year first before written.
38
SCHEDULE 1
THE SERVICES
In addition to the Services set out in the body of the Administration
Agreement, the Administrator shall:
(a) keep records (written or computerised) and books of account for the
Mortgages Trustee in relation to the Mortgage Loans comprised in the
Mortgage Portfolio;
(b) keep records for all taxation purposes and VAT;
(c) notify relevant Borrowers of any change in their Monthly Payments;
(d) assist the auditors of the Mortgages Trustee and provide information
to them upon reasonable request;
(e) provide a redemption statement to a Borrower or any person acting on
the Borrower's behalf, in each case upon written request or otherwise
at the discretion of the Administrator;
(f) notify relevant Borrowers of any other matter or thing which the
applicable Mortgage Conditions or Offer Conditions require them to be
notified of in the manner and at the time required by the relevant
Mortgage Terms;
(g) subject to the provisions of this Agreement (including, without
limitation, Clause 5.2 herein (Administration and Enforcement of
Mortgages)) take all reasonable steps to recover all sums due to the
Mortgages Trustee including without limitation by the institution of
proceedings and/or the enforcement of any Mortgage Loan comprised in
the Mortgage Portfolio or any New Mortgage Portfolio or any Related
Security;
(h) take all other action and do all other things which it would be
reasonable to expect a reasonable and prudent mortgage lender to do in
administering its mortgages;
(i) keep a Mortgage Account for each Mortgage Loan which shall record all
proceeds received in respect of that Mortgage Loan and all amounts
debited to such Mortgage Account;
(j) at its discretion, prepare and send on request an annual statement to
Borrowers in relation to each calendar year in the agreed form; and
(k) assist the Cash Manager in the preparation of the quarterly reports
substantially in the form set out in the Cash Management Agreement.
39
SCHEDULE 2
FORM OF INVESTORS' QUARTERLY REPORT
Granite Finance Trustees Limited
Monthly Report
Date of Report [ ]
Mortgages
Number of Mortgages in Pool [ ]
Current Balance (GBP)[ ]
Opening Trust Assets (GBP)[ ]
Funding Share (GBP)[ ]
Funding Share Percentage [ ]%
Funding 2 Share (GBP)[ ]
Funding 2 Share Percentage [ ]%
Seller Share (GBP)[ ]
Seller Share Percentage [ ]%
Minimum Seller Share (Amount) (GBP)[ ]
Minimum Seller Share (% of Total) [ ]%
Arrears Analysis of Non Repossessed Mortgages
Number Principal Arrears
Less than [ ] month [ ] [ ] [ ]
[ ] - [ ] months [ ] [ ] [ ]
[ ] - [ ] months [ ] [ ] [ ]
[ ] - [ ] months [ ] [ ] [ ]
[ ] - [ ] months [ ] [ ] [ ]
40
[ ] months + [ ] [ ] [ ]
Total [ ] [ ] [ ]
Properties in Possession Number Principal Arrears
Total [ ] [ ] [ ]
Properties in Possession
Number Brought Forward [ ]
Repossessed [ ]
Sold [ ]
Number Carried Forward [ ]
Average Time from Possession [ ]
to Sale
Average Arrears at Sale [ ]
Repossessed [ ]
MIG Claims Submitted [ ]
MIG Claims Outstanding [ ]
Average Time from Claim to [ ]
Payment
Note: The arrears analysis and repossession information is as at close of
business for the report month
Substitution Number Principal
Substituted this period (this month) [ ] [ ]
Substituted to dated (since [ ]) [ ] [ ]
CPR Analysis Monthly Annualised
Current [ ] Month CPR Rate [ ]% [ ]%
Previous [ ] Month CPR Rate [ ]% [ ]%
41
Weighted Average Seasoning (by value) [ ]
Average Loan Size [ ]
Weighted Average LTV (by value) [ ]%
Product Breakdown
Fixed Rate [ ]%
Flexible -Together [ ]%
LTV Levels Breakdown Number Value
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ] - [ ]% [ ] [ ]
[ ]% + [ ] [ ]
Totals [ ] [ ]
NR Current Existing Borrowers' SVR [ ]
Effective Date of Change [ ]
42
Notes Outstanding Rating Reference Rate
Moodys/S&P/Fitch
Funding
Issuer Notes
[ ] [relevant currency [ ]/[ ]/[ ] [ ]% [ ]%
amount]
Funding 2
Issuer Notes
[ ] [relevant currency [ ]/[ ]/[ ] [ ]% [ ]%
amount]
[Issuer Reserve Fund Requirement] (GBP)[ ]
Balance brought forward (GBP)[ ]
Drawings this period
Reserve Fund Top-up this period* (GBP)[ ]
Excess Spread (GBP)[ ]
Current Balance (GBP)[ ]
Funding Reserve Balance (GBP)[ ]
Funding Reserve % [ ]%
Funding 2 Reserve Balance (GBP)[ ]
Funding 2 Reserve % [ ]%
*Top-ups only occur at the end of each quarter.
43
SCHEDULE 3
ADMINISTRATOR REPRESENTATIONS AND WARRANTIES
The Administrator makes the following representations and warranties to the
Mortgages Trustee, each Funding Beneficiary and each Funding Security Trustee:
1. Status: It is a public limited company duly incorporated, validly
existing and registered under the laws of the jurisdiction in which it
is incorporated, capable of being sued in its own right and not
subject to any immunity from any proceedings, and it has the power to
own its property and assets and to carry on its business as it is
being conducted.
2. Powers and authority: It has the power to enter into, perform and
deliver, and has taken all necessary corporate and other action to
authorise the execution, delivery and performance by it of each of the
Transaction Documents to which it is or will be a party, and each such
Transaction Document has been duly executed and delivered by it.
3. Legal validity: Each Transaction Document to which it is or will be a
party constitutes or when executed in accordance with its terms will
constitute its legal, valid and binding obligation.
4. Non-conflict: The execution by it of each of the Transaction Documents
to which it is a party and the exercise by it of its rights and the
performance of its obligations under such Transaction Documents will
not:
(a) result in the existence or imposition of, nor oblige it to
create, any Security Interest in favour of any person over all
or any of its present or future revenues or assets;
(b) conflict with any document which is binding upon it or any of
its assets;
(c) conflict with its constitutional documents; or
(d) conflict with any law, regulation or official or judicial order
of any government, governmental body or court, domestic or
foreign, having jurisdiction over it.
5. No litigation: It is not a party to any material litigation,
arbitration or administrative proceedings and, to its knowledge, no
material litigation, arbitration or administrative proceedings are
pending or threatened against it.
6. Consents and Licences: All governmental consents, licences and other
approvals, permissions and authorisations required by it (in its
capacity as Administrator) in connection with the entry into,
performance, validity and enforceability of, and the transactions
contemplated by, the Transaction Documents have been obtained or
effected (as appropriate) and are in full force and effect.
7. Solvency: No Insolvency Event has occurred in respect of the
Administrator, and the Administrator is not insolvent.
44
8. Financial Statements: The most recent financial statements of the
Administrator:
(a) were prepared in accordance with accounting principles
generally accepted in England and Wales consistently applied;
(b) disclose all liabilities (contingent or otherwise) and all
unrealised and or anticipated losses of the Administrator; and
(c) save as disclosed therein, give a true and fair view of the
financial condition and operations of the Administrator during
the relevant financial year.
9. No Adverse Change: Since the date as of which the most recent
financial statements of the Administrator were stated to be prepared,
there has been:
(a) no significant change in the financial position of the
Administrator; and
(b) no material adverse change in the financial position or
prospects of the Administrator.
10. Ranking of Claims
Under the laws of England and Wales in force as at the date of making
this representation, claims against the Administrator under the
Transaction Documents will rank at least pari passu with the claims of
all its other unsecured and unsubordinated creditors, save those whose
claims are preferred solely by any bankruptcy, liquidation or other
similar laws of general application.
11. Information in Prospectus and Offering Circular:
(a) All information in the Prospectus and the Offering Circular
with regard to the Administrator, its business and its
experience administering mortgage loans (including its arrears
and repossession experience) are true and accurate in all
material respects and not misleading in any material respect.
(b) Any opinions, predictions and intentions expressed in the
Prospectus and/or the Offering Circular on the part of the
Administrator are honestly held and not misleading in any
material respect.
(c) Each of the Prospectus and the Offering Circular does not omit
to state any material fact necessary to make such information,
opinions, predictions or intentions not misleading in any
material respect.
(d) The Administrator has made all proper inquiries to ascertain
and to verify the foregoing.
45
SCHEDULE 4
AUTHORISED THIRD PARTY
1. Agreement to Allow Delegation
1.1. The Seller and the Administrator agree (subject to the other
provisions of this Schedule, including paragraph 2 (Appointment and
Payment) and subject to the Funding Deed of Charge or the Funding 2
Deed of Charge, as applicable) that a Funding Security Trustee may
appoint or facilitate the appointment of an Authorised Third Party to
implement, administer and carry out the duties and powers of such
Funding Security Trustee:
(a) under the Seller's Power of Attorney;
(b) in connection with and following a Completion Event; and
(c) in connection with and following a Termination Event,
(together the "Back-up Functions").
1.2. Each of the Seller and the Administrator shall authorise such
Authorised Third Party on their behalf and in their name or otherwise
to sign or execute or make any alteration or addition or deletion in
or to any agreements or documents or certificates or instructions or
notices which they are entitled or required to give, receive,
implement, transact or become a party to in relation to the Back-up
Functions or for doing any other act or thing required to be done by
them under or in connection with the Back-up Functions and otherwise
generally to sign, seal and deliver any agreement, assurance,
document, certificate, instruction or act which may be required by
such Authorised Third Party acting in connection with the Back-up
Functions.
2. Appointment and Payment
The appointment of such Authorised Third Party shall be on the terms
and conditions as negotiated between the relevant Funding Security
Trustee, the Seller and/or the Administrator (as the case may be) and
such Authorised Third Party. The fees, costs and expenses payable to
such Authorised Third Party shall be considered as part of the
additional remuneration and expenses of the relevant Funding Security
Trustee and therefore shall be payable in the manner contemplated, in
the case of the Security Trustee, by and in accordance with Clause 18
of the Funding Deed of Charge from funds that the Security Trustee
receives in accordance with the Funding Priority of Payments and in
the case of the Funding 2 Security Trustee, by and in accordance with
Clause [o] of the Funding 2 Deed of Charge from funds that the Funding
2 Security Trustee receives in accordance with the Funding 2 Priority
of Payments.
3. Delegation
3.1. Each Funding Security Trustee shall use reasonable endeavours (in its
opinion) to appoint in writing one or more persons to act as an
Authorised Third Party in respect of its Back-up Functions (on any
terms other than the power to appoint a delegate),
46
and references in the Operating Agreements to the "Security Trustee"
or the "Funding 2 Security Trustee" shall be construed accordingly
and, unless the context does not permit, include such Authorised Third
Party. The appointment of such Authorised Third Party may be revoked
by the Funding Security Trustee at any time.
3.2. In the event that a Funding Security Trustee has not, having used such
reasonable endeavours, appointed such Authorised Third Party, such
Funding Security Trustee shall have no liability to any person and,
notwithstanding any other provision of the Operating Agreements, shall
not itself be required to perform any Back-up Functions or any other
duties of the Seller or the Administrator either during the period it
is seeking to appoint an Authorised Third Party or thereafter.
3.3. As conditions precedent to the appointment of such Authorised Third
Party, the arrangements to be entered into between such Authorised
Third Party and the Seller or Administrator (as the case may be) shall
provide that (1) the Authorised Third Party shall make timely transfer
of information to the Seller or Administrator (as appropriate); and
(2) each Funding Security Trustee shall provide any Authorised Third
Party appointed by it hereunder with a copy of the Operating
Agreements and, where the Security Trustee is the Funding Security
Trustee, the Funding Deed of Charge or, where the Funding 2 Security
Trustee is the Funding Security Trustee, the Funding 2 Deed of Charge,
and shall request such Authorised Third Party to confirm in writing to
the Seller, the Administrator and the relevant Funding Security
Trustee that it has read and understood the terms of this Agreement
and the other Operating Agreements.
4. Ratification
Each of the Seller and the Administrator shall, upon the written
request of a Funding Security Trustee or its Authorised Third Party,
ratify and confirm all documents, deeds, certificates, instructions,
acts and things which such Funding Security Trustee or such Authorised
Third Party shall execute or do in the exercise of any of the powers
conferred, or purported to be conferred, on him by this Agreement and
the other Operating Agreements. The terms of appointment of such
Authorised Third Party shall oblige the Authorised Third Party to
provide information concerning its activities on a regular basis and
on request to:
(a) the Seller;
(b) the Administrator;
(c) where the Security Trustee is the Funding Security Trustee,
Funding and the Security Trustee; and
(d) where the Funding 2 Security Trustee is the Funding Security
Trustee, Funding 2 and the Funding 2 Security Trustee.
5. Limitations on the Responsibility of the Funding Security Trustee
A Funding Security Trustee shall not be obliged to monitor or
supervise the performance by any Authorised Third Party appointed by
it hereunder of its duties hereunder or in relation to the Operating
Agreements and shall not be responsible or
47
liable for any act or omission of such Authorised Third Party or for
any loss caused thereby, provided that if any party to a Transaction
Document notifies a Funding Security Trustee that an Authorised Third
Party appointed by it is implementing, administering or carrying out
the duties and powers of that Funding Security Trustee in breach of
the terms and conditions of the relevant Operating Agreement pursuant
to which such duties and powers are to be performed, that Funding
Security Trustee shall use its reasonable endeavours to appoint or
facilitate the appointment of a substitute Authorised Third Party to
implement, administer and carry out such duties and powers. The terms
of appointment of an Authorised Third Party and the appointing Funding
Security Trustee's responsibilities in relation thereto as set out in
this Schedule 4 shall apply to the appointment of a substitute
Authorised Third Party. Nothing in this Schedule constitutes a Funding
Security Trustee in its role as specified in this schedule as trustee
or fiduciary for any person. Each Funding Security Trustee shall
assume, until it receives notice thereof pursuant to the relevant
Operating Agreement, that no Back-up Trigger Event has occurred and
until such time that it receives such notification and is first
indemnified and/or secured to its satisfaction, is not entitled to
take any action in respect of the Back-up Functions under the
Operating Agreements.
6. Exoneration
6.1. Without limiting paragraph 6.2 below, each Funding Security Trustee
shall not be liable to any Person for any action taken or not taken by
it or its Authorised Third Party under or in connection with the
Operating Agreements, other than in respect of any loss, liability,
claim, expense or damage suffered or incurred by such Person in
respect of the gross negligence or wilful default of the Funding
Security Trustee or such Authorised Third Party in carrying out its
functions under the relevant Operating Agreement.
6.2. No Person may take any proceedings against any officer, employee or
agent of a Funding Security Trustee in respect of any claim it might
have against such Funding Security Trustee in respect of any act or
omission of any kind by their officer, employee or agent.
7. Funding Beneficiary Deed
The rights and powers in respect of a Funding Security Trustee which
have been delegated to an Authorised Third Party hereunder shall be
delegated subject to the terms of the Funding Beneficiary Deed.
48
SCHEDULE 5
MINIMUM SERVICING STANDARDS
The following list sets forth (i) certain of the Services provided for in the
body of the Administration Agreement and (ii) certain of the functions
required of the Cash Manager under the terms of the Cash Management Agreement,
which together are known as the "minimum servicing standards" for purposes of
Clause 5.7 (Independent Auditors' Annual Servicer Compliance Certificate) of
the Administration Agreement.
1. (Maintain records) keep and maintain records in relation to the
Mortgage Portfolio on a Mortgage Loan by Mortgage Loan basis for the
purposes of identifying amounts paid by each Borrower, any amount due
from a Borrower and the balance from time to time outstanding on a
Borrower's account (5.3).
2. (Collections) using reasonable endeavours credit all monthly payments
made by a Borrower to the relevant Collection Account within three (3)
London Business Days of receipt (5.1).
3. (Qualifications and compliance of laws) maintain all licences,
approvals, authorisations and consents necessary in connection with
the Administrator's performance of its obligations under the
Administration Agreement and not knowingly to fail to comply with any
legal requirements in the performance of those obligations. (17.1(d)
and (e)).
4. (Enforcement) in relation to any default by a Borrower under a
Mortgage Loan or a Mortgage, enforce the terms of such Mortgage Loan
or Mortgage in accordance with the Enforcement Procedures and as
otherwise provided in the Administration Agreement (5.2).
5. (Insurance) (a) administer the arrangements for insurance in which the
Mortgages Trustee or the Seller has an interest (14.1); (b) not
knowingly take or omit to take any action that could result in
avoidance, termination or invalidity of any Insurance Policy in
relation to any Mortgage Loans and Mortgages or reduce the amount
payable on any claim made on behalf of the Mortgage Trustees under any
Insurance Policy (14.2); (c) prepare and submit any claim under the
Insurance Policies in accordance with their terms (14.3); and (d) use
reasonable endeavours to credit all proceeds received under any
Insurance Policy to the relevant Collection Account within three (3)
London Business Days of such receipt (14.4).
6. (Determination of interest rates) (a) determine the Standard Variable
Rate chargeable to Borrowers from time to time and the Existing
Borrowers' Re-Fix Rate in accordance with section 4.1 of the
Administration Agreement; and (b) take all steps necessary pursuant to
the relevant Mortgage Conditions or applicable law to bring such
change in the Standard Variable Rate to the attention of the relevant
borrowers and notify details of such change to the Mortgages Trustee,
the Security Trustee, the Funding 2 Security Trustee and the
Beneficiaries (4.2).
7. (Provision of information) provide such information from its records
in relation to the Mortgage Loans to the Mortgages Trustee, Funding,
Funding 2, the Security Trustee
49
or the Funding 2 Security Trustee at any time upon reasonable notice,
subject to the conditions set forth in the Administration
Agreement (5.3).
8. (Access to books and records) permit the Mortgages Trustee, Funding,
Funding 2 (and their auditors), the Security Trustee and the Funding 2
Security Trustee and any other person nominated by the beneficiaries
(to whom the Administrator has no reasonable objection) upon
reasonable notice during normal office hours to have access to all
books of record and account (including Title Deeds and Mortgage Loan
Files) relating to the administration of the Mortgage Loans and the
Related Security, subject to applicable law and the conditions set
forth in the Administration Agreement (12.3).
9. (Custody of records) keep the Mortgage Loan Files relating to the
Mortgage Portfolio in safe custody and shall take appropriate
technical and organisational measures against the unauthorised or
unlawful processing of personal data and against accidental loss or
destruction of, or damage to, personal data. The Administrator shall
maintain in an adequate form such records as are necessary to enforce
each Mortgage comprised in the Mortgage Portfolio and, where relevant,
any other Related Security. The Administrator shall keep the Mortgage
Loan Files in relation to the Mortgage Portfolio in such a way that
they can be distinguished from information held by the Administrator
for its own behalf as mortgagee or heritable creditor or for other
third persons (12.1(a)).
10. (Ledgers)
(a) establish and maintain memorandum ledgers in the books of the
Mortgages Trustee to enable the ongoing identification and
segregation of principal, revenue, and overpayments;
(b) on a monthly basis ensure that the memorandum ledgers are
reconciled to the Mortgages Trustee Bank Accounts;
(c) establish and maintain memorandum ledgers in the books of
Funding to enable the ongoing identification and segregation of
principal, revenue and amounts constituting the Funding Reserve
Fund and any Issuer Reserve Funds and any Issuer Liquidity
Reserve Funds;
(d) establish and maintain memorandum ledgers in the books of
Funding 2 to enable the ongoing identification and segregation
of principal, revenue and amounts constituting the Funding 2
Reserve Fund and the Funding 2 Liquidity Reserve Fund;
(e) on a monthly basis ensure that the memorandum ledgers are
reconciled to the Funding Bank Accounts and the Funding 2 Bank
Accounts (as applicable); and
(f) establish and maintain ledgers in the books of Funding, Funding
2 and each Issuer to record the Intercompany Loans and, where
applicable, the Loan Tranches and subsequent payments of
interest and principal on each of the Intercompany Loans and,
where applicable, the Loan Tranches.
50
EXECUTION PAGE
as Administrator
EXECUTED for and on behalf of )
NORTHERN ROCK PLC )
by: )
-------------------------
Authorised Signatory
Name:
Title:
as Seller
EXECUTED for and on behalf of )
NORTHERN ROCK PLC )
by: )
-------------------------
Authorised Signatory
Name:
Title:
EXECUTED for and on behalf of )
GRANITE FINANCE TRUSTEES LIMITED )
by: )
-------------------------
Authorised Signatory
Name:
Title:
EXECUTED for and on behalf of )
GRANITE FINANCE FUNDING LIMITED )
by: )
-------------------------
Authorised Signatory
Name:
Title:
51
Definitions (to be included in a revised Master Definitions Schedule)
"AAA Loan Tranche" means, a tranche of any Funding 2 Intercompany Loan which
has been structured so as to reflect the payment obligations on the Notes of
the relevant Issuer which are rated AAA by S&P, Aaa by Xxxxx'x and AAA by
Fitch at their date of issue;
"Authorised Third Party" means any Person appointed by a Funding Security
Trustee pursuant to the terms of Schedule 4 of the Administration Agreement
and whom the Rating Agencies have previously confirmed in writing to (where
the Security Trustee is the Funding Security Trustee) Funding and the Security
Trustee or (where the Funding 2 Security Trustee is the Funding Security
Trustee) Funding 2 and the Funding 2 Security Trustee will not cause the then
current ratings of the Notes of any Issuer to be downgraded, withdrawn or
qualified provided that if the responsibilities that such appointed Person
will assume include setting the interest rate applicable to any Mortgage Loan,
such Person must be a lender in the United Kingdom residential mortgage
market;
"Bank Account Agreement" means the agreement entered into on or about the
Initial Closing Date between the Account Banks, the Mortgages Trustee, Funding
and the Security Trustee which governs the operation of the Mortgages Trustee
Bank Accounts, the Funding Bank Accounts other than the Funding (Issuer) GIC
Accounts;
"Beneficiaries" means Funding, Funding 2 and the Seller, as beneficiaries of
the Mortgages Trust and "Beneficiary" means any one of them;
"Funding Beneficiaries" means Funding and Funding 2, as beneficiaries of the
Mortgages Trust and "Funding Beneficiary" means either of them;
"Funding Intercompany Loan" means a loan of the net proceeds of any issue of
Notes by a Funding Issuer, such loan being advanced to Funding by such Funding
Issuer pursuant to the terms of a Funding Intercompany Loan Agreement;
"Funding Intercompany Loan Agreement" means an intercompany loan agreement
entered into between Funding and a Funding Issuer in relation to a Funding
Intercompany Loan;
"Funding Interest Rate Shortfall" has the meaning given in Clause [4.3(a)(2)]
of the Administration Agreement;
"Funding Issuer" means a wholly-owned subsidiary of Funding, which is
established to issue Notes and to make a Funding Intercompany Loan to Funding;
"Funding Security Trustees" means the Security Trustee and the Funding 2
Security Trustee and "Funding Security Trustee" means either of them;
"Funding 2" means Granite Finance Funding 2 Limited, a company incorporated
with limited liability in England and Wales, registered number 5249387;
"Funding 2 Bank Account Agreement" means the agreement entered into on or
about the Funding 2 Programme Date between the Account Bank, Funding 2 and the
Funding 2 Security Trustee which governs the operation of the Funding 2 Bank
Accounts;
52
"Funding 2 Bank Accounts" means the Funding 2 GIC Account and the Funding
Transaction Account and each such additional or replacement account in the
name of Funding that may be opened with the prior approval of the Funding 2
Security Trustee after the Funding 2 Programme Date;
"Funding 2 Basis Rate Swap Agreement" means the ISDA Master Agreement,
Schedule and Confirmations thereto each entered into on or about the Funding 2
Program Date and any Credit Support Annex or other credit support documents
entered into at any time among Funding 2 and the Funding 2 Basis Rate Swap
Provider and/or any credit support provider and shall include any additional
basis rate swap agreement entered into by Funding 2 from time to time in
accordance with the Transaction Documents;
"Funding 2 Basis Rate Swap Provider" means Northern Rock and/or, as
applicable, any other basis rate swap provider appointed from time to time by
Funding 2 in accordance with the Transaction Documents;
"Funding 2 Deed of Charge" means the deed of charge entered into on or about
the Funding 2 Program Date between Funding 2, the Funding 2 Security Trustee,
the Issuer Security Trustee, Granite Master Issuer plc, the Funding 2 Basis
Rate Swap Provider, the Corporate Services Provider, the Account Bank, the
Funding 2 GIC Provider, the Mortgages Trustee, and the Cash Manager and the
Schedules thereto and including each Deed of Accession or Accession
Undertaking entered into in connection therewith;
"Funding 2 GIC Account" means the account in the name of Funding 2 (sort code
30-00-59, account number [o]) held at Northern Rock, and maintained subject to
the Funding 2 Guaranteed Investment Contract and the Funding 2 Bank Account
Agreement and such additional or replacement accounts as may for the time
being be in place with the prior consent of the Funding 2 Security Trustee;
"Funding 2 GIC Provider" means, Northern Rock or such other person or persons
as are for the time being the GIC Provider to Funding under the Funding 2
Guaranteed Investment Contract;
"Funding 2 Guaranteed Investment Contract" means the guaranteed investment
contract entered into on or about the Funding 2 Program Date between Funding
2, the Funding 2 GIC Provider, the Cash Manager and the Funding 2 Security
Trustee under which the Funding 2 GIC Provider agrees to pay Funding 2 a
guaranteed rate of interest on the balance from time to time of the Funding 2
GIC Account and shall include any additional guaranteed investment contract
entered into by Funding 2 in accordance with the Transaction Documents;
"Funding 2 Intercompany Loan" means a loan (or the aggregate of a number of
separate loans) of the net proceeds of any issue (or all issues) of Notes by a
Funding 2 Issuer, such loan(s) being advanced to Funding 2 by such Funding 2
Issuer pursuant to the terms of a Funding 2 Intercompany Loan Agreement;
"Funding 2 Intercompany Loan Agreement" means an intercompany loan agreement
entered into between Funding 2 and a Funding 2 Issuer in relation to a Funding
2 Intercompany Loan;
53
"Funding 2 Interest Rate Shortfall" has the meaning given in Clause
[4.3(a)(1)] of the Administration Agreement;
"Funding 2 Issuer" means a wholly-owned subsidiary of Funding 2, which is
established to issue Notes and to make a Funding 2 Intercompany Loan to
Funding 2;
"Funding 2 Post-Enforcement Priority of Payments" means the rules and the
order of priority in which Funding 2 Available Revenue Receipts, Funding 2
Available Principal Receipts and all other monies, income, receipts and
recoveries of Funding 2 or the Funding 2 Security Trustee or any Receiver of
Funding 2 and the proceeds of enforcement of the Funding 2 Security are to be
applied following service of an Intercompany Loan Enforcement Notice or
otherwise following an enforcement of the Funding 2 Security as set out in
Part [o] of Schedule [o](Funding 2 Priority of Payments) to the Funding 2 Deed
of Charge, as the same may be amended, varied or superseded from time to time
in accordance with the terms of the Funding 2 Deed of Charge;
"Funding 2 Pre-Enforcement Principal Priority of Payments" means the rules and
the order of priority in which Funding 2 Available Principal Receipts will be
applied prior to the enforcement of the Funding 2 Security as set out in Part
[o] of Schedule [o] (Funding 2 Priority of Payments) to the Funding 2 Deed of
Charge, as the same may be amended, varied or superseded from time to time in
accordance with the terms of the Funding 2 Deed of Charge;
"Funding 2 Pre-Enforcement Revenue Priority of Payments" means the rules and
the order of priority in which Funding 2 Available Revenue Receipts will be
applied prior to the enforcement of the Funding 2 Security as set out in Part
[o] of Schedule [o] (Funding 2 Priority of Payments) to the Funding 2 Deed of
Charge, as the same may be amended, varied or superseded from time to time in
accordance with the terms of the Funding 2 Deed of Charge;
"Funding 2 Priority of Payments" means, as applicable, any of the Funding 2
Pre-Enforcement Revenue Priority of Payments, the Funding 2 Pre-Enforcement
Principal Priority of Payments or the Funding 2 Post-Enforcement Priority of
Payments;
"Funding 2 Reserve Fund" means the reserve fund established in the name of
Funding 2 on the Funding 2 Program Date in an amount up to the Funding 2
Reserve Maximum Amount, which prior to enforcement may be allocated to help
meet any deficit in Funding Available Revenue Receipts and thereby any deficit
recorded on the Issuer Principal Deficiency Ledgers and/or utilised to fund
expenses in connection with the issuance of Notes by Issuers;
"Funding 2 Secured Creditors" means the Funding 2 Security Trustee (and any
Receiver of Funding 2 appointed pursuant to the Funding 2 Deed of Charge),
Granite Master Issuer plc, the Corporate Services Provider in relation to
Funding 2, the Account Bank, the Funding 2 GIC Provider, the Mortgages
Trustee, the [NR] Start-up Loan Provider, the Cash Manager and each New
Funding 2 Secured Creditor who accedes to the Funding 2 Deed of Charge from
time to time pursuant to a Deed of Accession (including, for the avoidance of
doubt, any new Funding 2 Issuer);
"Funding 2 Security" means the security granted by Funding 2 under or pursuant
to the Funding 2 Deed of Charge in favour of the Funding 2 Security Trustee
for the benefit of
54
the Funding 2 Secured Creditors or any of them including the security granted
by Funding 2 under or pursuant to any Deed of Accession;
"Funding 2 Security Trustee" means The Bank of New York acting through its
office at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX, or such other persons
and all other persons for the time being acting as the security trustee or
security trustees pursuant to the Funding 2 Deed of Charge;
"Funding 2 Swap Collateral Account" means an account opened in the name of
Funding 2 for the purposes of holding Swap Collateral and maintained in
accordance with the Cash Management Agreement;
"Intercompany Loan Agreements" means the Funding Intercompany Loan Agreements
and the Funding 2 Intercompany Loan Agreements and "Intercompany Loan
Agreement" means, as applicable, a Funding Intercompany Loan Agreement or a
Funding 2 Intercompany Loan Agreement;
"Interest Rate Shortfalls" means the Funding Interest Rate Shortfall and the
Funding 2 Interest Rate Shortfall and "Interest Rate Shortfall" means, as
applicable, the Funding Interest Rate Shortfall and/or the Funding 2 Interest
Rate Shortfall;
"Issuer" means, as applicable, a Funding Issuer or a Funding 2 Issuer;
"Issuer Reserve Fund" means:
(a) with respect to the Funding Issuers, in relation to the First Issuer,
the First Issuer Reserve Fund, in relation to the Second Issuer, the
Second Issuer Reserve Fund and in relation to any other Funding Issuer,
the Current Issuer Reserve Fund as defined in the Issuer Master
Definitions Schedule relating to that Funding Issuer, in each case
established in the name of Funding in respect of such Funding Issuer as
required under the terms of the relevant Intercompany Loan of such
Funding Issuer on the relevant Closing Date in an amount equal to the
Issuer Reserve Required Amount; and
(b) with respect to the Funding 2 Issuers, the Issuer Reserve Fund as
defined in the Issuer Master Definitions Schedule relating to that
Funding 2 Issuer, in each case established on the relevant Closing Date
in an amount equal to the Issuer Reserve Required Amount as defined in
the Issuer Master Definitions Schedule relating to that Funding 2
Issuer;
"Issuer Swap Agreement" means, for any Issuer, the ISDA Master Agreement(s),
Schedule(s), Confirmation(s) and any credit support documents thereto entered
into among such Issuer, the relevant Issuer Swap Provider, the relevant Note
Trustee and any credit support provider and shall include any additional
and/or replacement currency swap agreement entered into by such Issuer from
time to time in connection with the Notes issued by such Issuer;
"Issuer Swap Provider" means in relation to any Issuer the swap counterparty
to such Issuer under any relevant Issuer Swap Agreement of such Issuer;
55
"Issuer Transaction Accounts" means, in relation to the First Issuer, the
Second Issuer and the Third Issuer, the First Issuer Transaction Accounts, the
Second Issuer Transaction Accounts and the Third Issuer Transaction Accounts
and in relation to any other Issuer, the Current Issuer Transaction Accounts
[or Issuer Transaction Accounts] as defined in the Issuer Master Definitions
Schedule relating to that Issuer;
"Lead Arrangers" means [o];
"Note Trust Deed" means, in relation to any Issuer, the trust deed entered
into between that Issuer and the Note Trustee in respect of that Issuer that
constitutes the Notes of that Issuer;
"Swap Collateral" means any asset (including, without limitation, Cash and/or
securities) paid or transferred to Funding 2 by the Funding 2 Basis Rate Swap
Provider in accordance with the terms of the relevant Funding 2 Basis Rate
Swap Agreement as collateral to secure the performance of the Funding 2 Basis
Rate Swap Provider's obligations under the Funding 2 Basis Rate Swap Agreement
together with any income or distributions received in respect of such asset
and any equivalent of or replacement of such asset into which such asset is
transformed;
"Swap Provider" means any of the Currency Swap Provider and/or the Basis Rate
Swap Provider and/or the Interest Rate Swap Providers and/or the Issuer Swap
Providers, as the context requires, or any other swap provider appointed from
time to time in accordance with the Transaction Documents or relevant Issuer
Transaction Documents;
"Termination Event" has the meaning given in Clause [19] of the Administration
Agreement;
56
