Exhibit 4.9
Dated 4 February 2004
---------------------
GRANITE MORTGAGES 03-2 plc
as Current Issuer
NORTHERN ROCK PLC
as Current Issuer Cash Manager
- and -
THE BANK OF NEW YORK
as Note Trustee
______________________________________________
ISSUER CASH MANAGEMENT AGREEMENT
AMENDMENT AND RESTATEMENT DEED
______________________________________________
SIDLEY XXXXXX XXXXX & XXXX
0 XXXXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
THIS ISSUER CASH MANAGEMENT AMENDMENT DEED is made on 4 February 2004
BETWEEN:
(1) GRANITE MORTGAGES 03-2 PLC (registered number 4684567), a public limited
company incorporated under the laws of England and Wales, whose
registered office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX as
the Current Issuer;
(2) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales whose registered office
is at Northern rock Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as cash manager for the Current Issuer (the "Current Issuer Cash
Manager", which expression shall include such other person as may from
time to time be appointed as cash manager for the Current Issuer pursuant
to this Agreement); and
(3) 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 Note Trustee.
WHEREAS:
(A) The Current Issuer Cash Manager has agreed to provide cash management
services to the Current Issuer on the terms and subject to the conditions
contained in the Issuer Cash Management Agreement dated 21 May 2003 (the
"Issuer Cash Management Agreement").
(B) The parties to this Deed now wish to amend and restate the Issuer Cash
Management Agreement pursuant to the provisions set out in this Deed.
(C) With effect from 4 February 2004, the provisions of the Issuer Cash
Management Agreement and this Deed shall be read and construed as one
document.
NOW IT IS HEREBY AGREED as follows:
1. Interpretation
1.1 The provisions of:
(a) the Master Definitions Schedule as amended and restated by (and
appearing in Appendix 1 to) the Master Definitions Schedule Seventh
Amendment Deed made on 26 January 2004 between, among others, the
parties thereto; and
(b) the Issuer Master Definitions Schedule signed for the purposes of
identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx & Xxxxx on 21
May 2003;
(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 Deed (and recitals
hereto). The Issuer Master Definitions Schedule specified above shall
prevail to the extent that it conflicts with the Master Definitions
Schedule.
1.2 The Issuer Cash Management Agreement as amended and restated pursuant
hereto shall be referred to herein as the "Amended and Restated Issuer
Cash Management Agreement".
1.3 As used in the Issuer Cash Management Agreement, the terms "Issuer Cash
Management Agreement", "this Issuer Cash Management Agreement",
"Agreement", "this Agreement", "herein", "hereinafter", "hereof",
"hereto" and other words of similar import shall mean or refer to the
Amended and Restated Issuer Cash Management Agreement, unless the context
otherwise specifically requires.
2. Amendments to the Issuer Cash Management Agreement
Each of the parties to this deed agree that with effect from (and
including) 4 February 2004 the Issuer Cash Management 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 Issuer Cash Management
Agreement under the Contract (Rights of Third Parties) Xxx 0000.
4. Counterparts
This Deed may be executed in any number of counterparts, and has the same
effect as if the signatures 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.
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EXECUTION PAGE
IN WITNESS WHEREOF this Deed has been executed as a deed by the parties hereto
and entered into the day and year first above written.
Executed by
GRANITE MORTGAGES 03-2 PLC
as its deed as follows: By__________________________________
Signed for and on its behalf for and on behalf of LDC
by one of its directors and Securitisation Director
by another of its directors/ No.1 Limited
its secretary
Name__________________________________
By__________________________________
Name__________________________________
__________________________________
Executed by
THE BANK OF NEW YORK
as its deed as follows: By__________________________________
Signed for and on its behalf Duly Authorised
by one of its duly authorised Attorney/Signatory
attorneys/signatories
Name__________________________________
__________________________________
Executed by
NORTHERN ROCK PLC By__________________________________
as its deed as follows: Duly Authorised Attorney
Signed for and on its behalf
by its duly authorised attorney
Name__________________________________
Signature ________________________________
Witness
Full name ________________________________
Occupation________________________________
Address ________________________________
________________________________
________________________________
________________________________
3
Appendix I
Amended and Restated Issuer Cash Management Agreement
4
Dated 4 February 2004
NORTHERN ROCK PLC
as Current Issuer Cash Manager
GRANITE MORTGAGES 03-2 PLC
as Current Issuer
- and -
THE BANK OF NEW YORK
as Note Trustee
---------------------------------------------------------------
AMENDED AND RESTATED ISSUER CASH
MANAGEMENT AGREEMENT
---------------------------------------------------------------
SIDLEY XXXXXX XXXXX & XXXX
0 XXXXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
Table of Contents
-----------------
Page
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1. Definitions and Interpretation.......................................................................................1
2. Appointment of Current Issuer Cash Manager...........................................................................2
3. The Current Issuer Cash Management Services..........................................................................2
4. Payments, Accounts, Ledgers..........................................................................................3
5. Payments Under Current Issuer Swap Agreements; Termination & Swap Collateral.........................................6
6. No Liability.........................................................................................................9
7. Costs and Expenses..................................................................................................10
8. Information.........................................................................................................10
9. Remuneration........................................................................................................12
10. Covenants, Representations and Warranties of Current Issuer Cash Manager............................................13
11. Current Issuer Cash Management Services Non-Exclusive...............................................................14
12. Termination.........................................................................................................14
13. Further Assurances..................................................................................................17
14. Miscellaneous.......................................................................................................17
15. Confidentiality.....................................................................................................18
16. No Partnership......................................................................................................19
17. Assignment..........................................................................................................19
18. The Note Trustee....................................................................................................19
19. Non Petition Covenant; Limited Recourse.............................................................................19
20. Amendments and Waiver...............................................................................................21
21. Notices.............................................................................................................21
22. Third Party Rights..................................................................................................22
23. Execution in Counterparts; Severability.............................................................................22
24. Governing Law and Jurisdiction; Appropriate Forum...................................................................22
SCHEDULE 1 The Current Issuer Cash Management Services........................................................................24
i
Table of Contents
-----------------
continued
Page
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SCHEDULE 2 Cash Management and Maintenance of Ledgers.........................................................................27
SCHEDULE 3 Form of Issuer Quarterly Report....................................................................................47
SCHEDULE 4 Controlled Amortisation Amount/Target Balance......................................................................52
SCHEDULE 5 Current Issuer Cash Manager Representations and Warranties.........................................................56
ii
THIS AMENDED AND RESTATED ISSUER CASH MANAGEMENT AGREEMENT DATED 4 FEBRUARY
2004 AMENDS AND RESTATES THE ISSUER CASH MANAGEMENT AGREEMENT DATED 21 MAY
2003
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 the Current Issuer Cash Manager;
(2) GRANITE MORTGAGES 03-2 PLC (registered number 4684567), a public
limited company incorporated under the laws of England and Wales whose
registered office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX
as the Current Issuer; and
(3) THE BANK OF NEW YORK, whose principal office is at 00xx Xxxxx, Xxx
Xxxxxx Xxxxxx, Xxxxxx X00 0XX, in its capacity as Note Trustee.
WHEREAS:
(A) On the Closing Date the Current Issuer will issue the Current Issuer
Notes constituted by the Current Issuer Trust Deed. From the proceeds
of the issue of those Current Issuer Notes, the Current Issuer shall
make an Intercompany Loan to Granite Finance Funding Limited pursuant
to the terms of the Current Issuer Intercompany Loan Agreement.
(B) The Current Issuer Cash Manager is willing to provide cash management
services to the Current Issuer and the Note Trustee on the terms and
subject to the conditions contained in this Agreement.
IT IS HEREBY AGREED as follows:
1. Definitions and Interpretation
The provisions of:
(a) the Master Definitions Schedule as amended and restated by (and
appearing in Appendix 1 to) the Master Definitions Schedule
Seventh Amendment and Restatement Deed made on 26 January 2004
between, among others, the parties hereto (the "Master
Definitions Schedule"), and
(b) the Issuer Master Definitions Schedule signed for the purposes
of identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx &
Overy on 21 May 2003 (the "Issuer Master Definitions Schedule"),
(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. The
Issuer Master Definitions Schedule shall prevail to the extent that it
conflicts with the Master Definitions Schedule.
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2. Appointment of Current Issuer Cash Manager
2.1 Appointment: Until termination pursuant to Clause 12 (Termination), the
Current Issuer and the Note Trustee (according to their respective
estates and interests) each hereby appoints the Current Issuer Cash
Manager as its lawful agent on each of their behalves to provide the
Current Issuer Cash Management Services set out in this Agreement,
including in relation to the Current Issuer Notes to be issued by the
Current Issuer. The Current Issuer Cash Manager in each case hereby
accepts such appointment on the terms and subject to the conditions of
this Agreement.
2.2 Duties prescribed by Transaction Documents: For the avoidance of doubt
and in connection with the powers conferred under Clause 2.1
(Appointment), save as expressly provided elsewhere in this Agreement,
nothing herein shall be construed so as to give the Current Issuer Cash
Manager any powers, rights, authorities, directions or obligations
other than as specified in this Agreement or any of the other
Transaction Documents.
2.3 Appointment conditional upon issuance of Current Issuer Notes: The
appointment pursuant to Clause 2.1 (Appointment) is conditional upon
the issue of the Current Issuer Notes and the making of the Current
Issuer Intercompany Loan under the Current Issuer Intercompany Loan
Agreement and shall take effect upon and from the Closing Date
automatically without any further action on the part of any person,
PROVIDED THAT if the issue of the Current Issuer Notes has not occurred
by 31 May 2003, or such later date as the Current Issuer and the Lead
Managers may agree, this Agreement shall cease to be of further effect.
3. The Current Issuer Cash Management Services
3.1 General: The Current Issuer Cash Manager shall provide the services set
out in this Agreement (including, without limitation, Schedules 1 and 2
attached hereto) (the "Current Issuer Cash Management Services").
3.2 Approvals and authorisations: The Current Issuer Cash Manager shall
maintain, or procure the maintenance of, the approvals, authorisations,
consents and licences required in connection with the business of the
Current Issuer and shall prepare and submit, or procure the preparation
and submission of, on behalf of the Current Issuer, all necessary
applications and requests for any further approvals, authorisations,
consents or licences which may be required in connection with the
business of the Current Issuer and shall, so far as it reasonably can
do so, perform the Current Issuer Cash Management Services in such a
way as not to prejudice the continuation of any such approvals,
authorisations, consents or licences.
3.3 Compliance with Transaction Documents, etc.: The Current Issuer Cash
Management Services shall include procuring (so far as the Current
Issuer Cash Manager, using its reasonable endeavours, is able so to do)
compliance by the Current Issuer with all applicable legal requirements
and with the terms of the Current Issuer Transaction Documents,
PROVIDED THAT the Current Issuer Cash Manager shall not lend or provide
any sum to the Current Issuer and the Current Issuer Cash Manager shall
have no liability whatsoever to the Current Issuer, the Note Trustee or
any other person for any failure by the Current Issuer to make any
payment due by any of them under any of the Current Issuer Transaction
Documents (other than to the
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extent arising from the Current Issuer Cash Manager failing to perform
any of its obligations under any of the Transaction Documents).
3.4 Liability of Current Issuer Cash Manager:
(a) The Current Issuer Cash Manager shall indemnify each of the
Current Issuer and the Note Trustee on demand for any loss,
liability, claim, expense or damage suffered or incurred by it
in respect of the negligence, bad faith or wilful default of the
Current Issuer Cash Manager in carrying out its functions as
Current Issuer Cash Manager under, or as a result of a breach by
the Current Issuer Cash Manager of, the terms and provisions of
this Agreement or such other Transaction Documents to which the
Current Issuer Cash Manager is a party (in its capacity as such)
in relation to such functions.
(b) For the avoidance of doubt, the Current Issuer Cash Manager
shall not be liable in respect of any loss, liability, claim,
expense or damage suffered or incurred by the Current Issuer or
the Note Trustee and/or any other person as a result of the
proper performance of the Current Issuer Cash Management
Services (as defined in Clause 3.1 (General)) by the Current
Issuer Cash Manager save to the extent that such loss,
liability, claim, expense or damage is suffered or incurred as a
result of any negligence, bad faith or wilful default of the
Current Issuer Cash Manager under, or as a result of a breach by
the Current Issuer Cash Manager of, the terms and provisions of
this Agreement or any of the other Transaction Documents to
which the Current Issuer Cash Manager is a party (in its
capacity as such) in relation to such functions.
4. Payments, Accounts, Ledgers
4.1 Current Issuer Bank Accounts: The Current Issuer Cash Manager hereby
confirms that each of the Current Issuer Transaction Accounts have been
established on or before the date hereof and that the mandates in the
agreed form will apply thereto at the Closing Date. The Current Issuer
Cash Manager undertakes (to the extent to which the same is within its
control in its capacity as Current Issuer Cash Manager) that at the
Closing Date the Current Issuer Transaction Accounts will be operative
and that the Current Issuer Cash Manager will not knowingly create or
permit to subsist any Security Interest in relation to the Current
Issuer Transaction Accounts other than as created under or permitted
pursuant to the Current Issuer Deed of Charge.
4.2 Current Issuer Ledgers:
(a) The Current Issuer Cash Manager shall open and maintain in the
books of the Current Issuer the following ledgers:
(i) the Current Issuer Revenue Ledger, which shall record all
Current Issuer Revenue Receipts standing to the credit of
the Current Issuer Transaction Accounts from time to
time;
(ii) the Current Issuer Principal Ledger, which shall record
all Current Issuer Principal Receipts standing to the
credit of the Current Issuer Transaction Accounts from
time to time;
3
(iii) the Current Issuer Principal Deficiency Ledger, which
shall comprise three sub-ledgers to be known as the Class
A Principal Deficiency Sub Ledger, the Class B Principal
Deficiency Sub Ledger and the Class C Principal
Deficiency Sub Ledger, and which shall record (A) any
principal deficiencies arising from Losses on the
Mortgage Loans which have been allocated by Funding to
the Current Issuer Intercompany Loan, (B) the application
of Current Issuer Principal Receipts to meet any
deficiency in Current Issuer Revenue Receipts and (C) the
application of Funding Available Principal Receipts to
fund the Current Issuer Liquidity Reserve Fund; and
(iv) the Swap Collateral Ledger, (which shall comprise of such
sub-ledgers as the Current Issuer Cash Manager considers
appropriate) to record all payments, transfers and
receipts in connection with Swap Collateral, including,
without limitation:
(A) the receipt of any Swap Collateral by the Current
Issuer from the Swap Providers;
(B) the receipt of any income or distributions in
respect of such Swap Collateral;
(C) the payment or transfer of all, or any part of,
such Swap Collateral to the relevant Current
Issuer Swap Provider; and
(D) the realisation of such Swap Collateral,
provided that the Swap Collateral Ledger (and
sub-ledgers) shall only be established in the event that
any Current Issuer Swap Provider pays or transfers Swap
Collateral to the Issuer in accordance with the relevant
Current Issuer Swap Agreement.
(b) The Current Issuer Cash Manager shall make credits and debits to
the Current Issuer Ledgers in accordance with the provisions of
paragraphs 5, 6, 7, 8, 9 and 10 of Schedule 2 hereto.
4.3 Payments:
(a) The Current Issuer Cash Manager shall procure that the following
amounts payable to the Current Issuer are paid into the Current
Issuer Transaction Accounts:
(i) all Current Issuer Revenue Receipts;
(ii) all Current Issuer Principal Receipts;
(iii) all amounts (excluding Swap Collateral Excluded Amounts)
received by the Current Issuer pursuant to the Current
Issuer Swap Agreements; and
(iv) any other amounts whatsoever received by or on behalf of
the Current Issuer on or after the Closing Date,
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and the Current Issuer Cash Manager shall procure that all
investment proceeds from Authorised Investments purchased from
amounts standing to the credit of any of the Current Issuer
Transaction Accounts are credited to each such account. All
amounts received by the Current Issuer denominated (i) in
Sterling shall be paid into the Current Issuer Sterling Account,
(ii) in U.S. Dollars shall be paid into the Current Issuer
Dollar Account and (iii) in Euro shall be paid into the Current
Issuer Euro Account.
(b) The Current Issuer Cash Manager shall procure that all transfers
and withdrawals of amounts standing to the credit of the Current
Issuer Transaction Accounts and Swap Collateral Accounts shall
be made in accordance with the provisions of the Current Issuer
Bank Account Agreement and the Current Issuer Deed of Charge.
(c) Each of the payments into the Current Issuer Transaction
Accounts referred to in Clause 4.3(a) shall be made forthwith
upon receipt by the Current Issuer or the Current Issuer Cash
Manager of the amount in question.
(d) For the avoidance of doubt, as soon as reasonably practicable
after becoming aware of the same, the Current Issuer Cash
Manager may, and shall, withdraw Cash from the Current Issuer
Transaction Accounts and Swap Collateral Cash Accounts, if, and
to the extent that, such Cash was credited thereto in error and
shall use its reasonable endeavours to ensure that such Cash is
applied correctly thereafter.
(e) The Current Issuer Cash Manager shall promptly notify each of
the Current Issuer and the Note Trustee of any additional
account or sub-account which supplements or replaces any account
or sub-account specifically referred to in the definition of the
"Current Issuer Transaction Accounts" in the Current Issuer
Master Definitions Schedule.
(f) Each of the Current Issuer Cash Manager and the Current Issuer
undertakes that, so far as it is able to procure the same, the
Current Issuer Transaction Accounts and all instructions and
mandates in relation thereto will continue to be operative and
will not, save as permitted pursuant to the Current Issuer Bank
Account Agreement, be changed without the prior written consent
of the Note Trustee (such consent not to be unreasonably
withheld or delayed). For the avoidance of doubt, the Current
Issuer Cash Manager may change the authorised signatories in
respect of any instructions or mandates relating to the Current
Issuer, without the prior written consent of the Note Trustee,
in accordance with the terms of the Current Issuer Bank Account
Agreement.
4.4 Withdrawals:
(a) The Current Issuer Cash Manager may make withdrawals on behalf
of the Current Issuer from the Current Issuer Transaction
Accounts (but only until receipt of a copy of a Current Issuer
Note Enforcement Notice served by the Note Trustee on the
Current Issuer) and Swap Collateral Accounts as permitted by
this Agreement, the Current Issuer Trust Deed, the Current
Issuer Bank Account Agreement and the Current Issuer Deed of
Charge, but shall not in carrying out its functions as Current
Issuer Cash Manager under this
5
Agreement otherwise make withdrawals from the Current Issuer
Transaction Accounts and Swap Collateral Accounts.
(b) Upon receipt of such a Current Issuer Note Enforcement Notice,
no amount shall be withdrawn from any Current Issuer Transaction
Account by the Current Issuer Cash Manager without the prior
written consent of the Note Trustee.
4.5 Cash Management: In administering the Current Issuer Transaction
Accounts on behalf of the Current Issuer and the Note Trustee, the
Current Issuer Cash Manager shall comply with the provisions of
Schedule 2 prior to receipt by the Current Issuer Cash Manager of a
copy of any Current Issuer Note Enforcement Notice served on the
Current Issuer. Following service of a Current Issuer Note Enforcement
Notice, the Note Trustee or any Receiver appointed by the Note Trustee
will administer the Current Issuer Transaction Accounts in accordance
with the terms of the Current Issuer Deed of Charge.
5. Payments Under Current Issuer Swap Agreements; Termination & Swap
Collateral
5.1 Current Issuer Available Revenue Receipts: Subject to the order of
priorities of payment set out in Schedule 2 or, as the case may be, the
Current Issuer Deed of Charge, on each Payment Date prior to the
enforcement of the Current Issuer Security under the Current Issuer
Deed of Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Revenue Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to the Current Issuer Basis Rate Swap Provider.
Amounts received by the Current Issuer Cash Manager from the Current
Issuer Basis Rate Swap Provider will be applied to pay (1) in respect
of the Dollar Notes, the Current Issuer Dollar Currency Swap Provider,
and amounts received by the Current Issuer Cash Manager from the
Current Issuer Dollar Currency Swap Provider will be applied to pay
amounts due to the holders of the relevant classes of Dollar Notes in
accordance with the Current Issuer Pre-Enforcement Revenue Priority of
Payments, (2) in respect of the Sterling Notes (excluding the Series 3
Class A Notes), amounts due to the holders of the relevant classes of
Sterling Notes in accordance with the Current Issuer Pre-Enforcement
Revenue Priority of Payments and in respect of the Series 3 Class A
Notes, the Current Issuer Series 3 Class A Interest Rate Swap Provider,
and amounts received by the Current Issuer Cash Manager from the
Current Issuer Series 3 Class A Interest Rate Swap Provider will be
applied to pay amounts due to the holders of the Series 3 Class A Notes
in accordance with the Current Issuer Pre-Enforcement Revenue Priority
of Payment, and (3) in respect of the Euro Notes, the Current Issuer
Euro Currency Swap Provider, and amounts received by the Current Issuer
Cash Manager from the Current Issuer Euro Currency Swap Provider will
be applied to pay amounts due to the holders of the relevant classes of
Euro Notes in accordance with the Current Issuer Pre-Enforcement
Revenue Priority of Payments.
5.2 Current Issuer Available Principal Receipts: Subject to the order of
priorities of payment set out in Schedule 2 or, as the case may be, the
Current Issuer Deed of Charge, on each Payment Date prior to
enforcement of the Current Issuer Security under the Current Issuer
Deed of Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Principal Receipts received in respect of the Current Issuer
6
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to (1) in respect of the Dollar Notes, the
Current Issuer Dollar Currency Swap Provider, and amounts received by
the Current Issuer Cash Manager from the Current Issuer Dollar Currency
Swap Provider will be applied to pay amounts due to the holders of the
relevant classes of Dollar Notes in accordance with the Current Issuer
Pre-Enforcement Principal Priority of Payments, (2) in respect of the
Sterling Notes, amounts due to the holders of the relevant classes of
Sterling Notes in accordance with the Current Issuer Pre-Enforcement
Principal Priority of Payments, and (3) in respect of the Euro Notes,
the Current Issuer Euro Currency Swap Provider, and amounts received by
the Current Issuer Cash Manager from the Current Issuer Euro Currency
Swap Provider will be applied to pay amounts due to the holders of the
relevant classes of Euro Notes in accordance with the Current Issuer
Pre-Enforcement Principal Priority of Payments.
5.3 Following a Non-Asset Trigger Event: On each Payment Date following the
occurrence of a Non-Asset Trigger Event under the Mortgages Trust Deed
but prior to enforcement of the Funding Security under the Funding Deed
of Charge or the Current Issuer Security under the Current Issuer Deed
of Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Principal Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to (1) in respect of the Dollar Notes, the
Current Issuer Dollar Currency Swap Provider, and amounts received by
the Current Issuer Cash Manager from the Current Issuer Dollar Currency
Swap Provider will be applied to pay amounts due to the holders of the
relevant classes of Dollar Notes, and (2) in respect of the Sterling
Notes, amounts due to the holders of the relevant classes of Sterling
Notes, and (3) in respect of the Euro Notes, the Current Issuer Euro
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Euro Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of
Euro Notes, each in accordance with the priority of payments set forth
in Clause 4.2 (Distribution of Current Issuer Available Principal
Receipts Following the Occurrence of a Non-Asset Trigger Event) of
Schedule 2.
5.4 Following an Asset Trigger Event: On each Payment Date following the
occurrence of an Asset Trigger Event under the Mortgages Trust Deed but
prior to enforcement of the Funding Security under the Funding Deed of
Charge or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Principal Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to (1) in respect of the Dollar Notes, the
Current Issuer Dollar Currency Swap Provider, and amounts received by
the Current Issuer Cash Manager from the Current Issuer Dollar Currency
Swap Provider will be applied to pay amounts due to the holders of the
relevant classes of Dollar Notes, and (2) in respect of the Sterling
Notes, amounts due to the holders of the relevant classes of Sterling
Notes, and (3) in respect of the Euro Notes, the Current Issuer Euro
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Euro Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of
Euro Notes, each in accordance with the priority of payments set forth
in Clause 4.3 (Distribution of Current Issuer Available Principal
Receipts Following the Occurrence of an Asset Trigger Event) of
Schedule 2.
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5.5 Termination: If on or prior to the date of the earlier of (i) repayment
in full of the Current Issuer Notes or (ii) the service of a Current
Issuer Note Enforcement Notice, any of the Current Issuer Swap
Agreements is terminated, the Current Issuer Cash Manager (on behalf of
the Current Issuer and the Note Trustee) shall purchase a replacement
hedge, as applicable, in respect of the relevant Series of Current
Issuer Notes in each case on terms acceptable to the Rating Agencies,
the Current Issuer and the Note Trustee and with a swap provider that
the Rating Agencies have previously confirmed in writing to the Current
Issuer and the Note Trustee will not cause the then-current ratings of
the Current Issuer Notes to be downgraded, withdrawn or qualified. The
Current Issuer may apply any early termination payment received from,
as appropriate, the relevant Current Issuer Swap Provider for such
purpose.
5.6 Swap Collateral:
(a) In the event that pursuant to the terms of a Current Issuer Swap
Agreement a Current Issuer Swap Provider pays or transfers Swap
Collateral to the Current Issuer, the Current Issuer Cash
Manager shall:
(i) create the Swap Collateral Ledger in the books of the
Current Issuer if not already created so as to record the
amount and type of such Swap Collateral and identify the
relevant Current Issuer Swap Agreement in respect of
which it has been posted;
(ii) upon receipt of such Swap Collateral, credit it to and
record the relevant details in the Swap Collateral
Ledger;
(iii) to the extent that such Swap Collateral is in the form of
Cash, pay it into the relevant Swap Collateral Cash
Account; and
(iv) to the extent that such Swap Collateral is in the form of
securities, arrange for it to be credited to the relevant
Swap Collateral Securities Account.
(b) Any such Swap Collateral shall not form part of the Current
Issuer Available Revenue Receipts and the Current Issuer
Available Principal Receipts. If the terms of the relevant
Current Issuer Swap Agreement permit such Swap Collateral to be
applied in or towards satisfaction of the Current Issuer's Swap
Provider's obligations under the relevant Current Issuer Swap
Agreement, and in the event that such Swap Collateral is to be
so applied, the Current Issuer Cash Manager shall:
(i) where the relevant Swap Collateral is in the form of
Cash, transfer the relevant amount of Cash from the
relevant Swap Collateral Cash Account to the relevant
Current Issuer Transaction Account; and/or
(ii) where the relevant Swap Collateral is in the form of
securities, realise the Swap Collateral and pay the
amount of the net proceeds into the relevant Current
Issuer Transaction Account,
and, in each case, make the appropriate debits and credits to
the Swap Collateral Ledger, apply such amount as if it had been
paid to the Current
8
Issuer by the Current Issuer Swap Provider under the relevant
Current Issuer Swap Agreement and make appropriate ledger
entries.
(c) To the extent that pursuant to the terms of the relevant Current
Issuer Swap Agreement Swap Collateral is to be transferred or
paid to the Current Issuer Swap Provider, the Current Issuer
Cash Manager shall:
(i) where the relevant Swap Collateral is in the form of
Cash, pay the relevant amount of Cash out of the relevant
Swap Collateral Cash Account to the Current Issuer Swap
Provider; and/or
(ii) where the relevant Swap Collateral is in the form of
securities, transfer and deliver the Swap Collateral to
the Current Issuer Swap Provider,
and, in each case, debit the Swap Collateral Ledger as
appropriate.
(d) Where:
(i) Swap Collateral is to be applied in satisfaction of the
Current Issuer Swap Provider's obligations under the
relevant Current Issuer Swap Agreement; and
(ii) such Swap Collateral or the proceeds of such Swap
Collateral are in a different currency to the currency
(the "Required Currency") in which such obligations of
the Current Issuer Swap Provider are payable,
then, the Current Issuer Cash Manager shall arrange for such
Swap Collateral to be converted (by such person as the Current
Issuer Cash Manager may reasonably select) at the prevailing
spot rate of exchange into the Required Currency.
(e) The terms of this Clause 5.6 shall prevail if and to the extent
that they are inconsistent with the other paragraphs of this
Clause 5.
5.7 Spot Rate Conversions: In the event that any payment is to be made from
the Current Issuer Available Revenue Receipts or the Current Issuer
Available Principal Receipts by the Current Issuer under the Current
Issuer Priority of Payments and the Current Issuer Available Revenue
Receipts or the Current Issuer Available Principal Receipts, as
applicable, do not comprise a sufficient amount in the relevant
currency in which such payment is to be made, the Current Issuer Cash
Manager shall arrange for any remaining amounts comprised in the
Current Issuer Available Revenue Receipts or the Current Issuer
Available Principal Receipts, as applicable, to be converted (by such
person as the Current Issuer Cash Manager may reasonably select) into
such currency at the then prevailing spot rate of exchange as may be
required in order to be applied in or towards such payment
6. No Liability
Save as otherwise provided in this Agreement, the Current Issuer Cash
Manager shall have no liability for the obligations of either the Note
Trustee or the Current Issuer under any of the Transaction Documents or
otherwise and nothing herein shall
9
constitute a guarantee, or similar obligation, by the Current Issuer
Cash Manager of either the Note Trustee or the Current Issuer in
respect of any of them.
7. Costs and Expenses
7.1 Subject to and in accordance with the Current Issuer Pre-Enforcement
Priority of Payments or, as the case may be, the Current Issuer
Post-Enforcement Priority of Payments, the Current Issuer will on each
Payment Date reimburse the Current Issuer Cash Manager for all
out-of-pocket costs, expenses and charges (together with any amounts in
respect of Irrecoverable VAT due thereon) properly incurred by the
Current Issuer Cash Manager in the performance of the Current Issuer
Cash Management Services, including any such costs, expenses or charges
not reimbursed to the Current Issuer Cash Manager on any previous
Payment Date and the Current Issuer Cash Manager shall supply the
Current Issuer with an appropriate VAT invoice issued by the Current
Issuer Cash Manager or, if the Current Issuer Cash Manager has treated
the relevant cost, expense or charge as a disbursement for VAT
purposes, by the person making the supply.
7.2 Unless and until otherwise agreed by the Current Issuer and the Note
Trustee in writing (notified to the Current Issuer Cash Manager), the
Current Issuer shall be solely responsible for reimbursing the Current
Issuer Cash Manager for the out-of-pocket costs, expenses and charges
(together with any amounts in respect of Irrecoverable VAT due thereon)
referred to in Clause 7.1 (Costs and Expenses).
8. Information
8.1 Use of information technology systems:
(a) The Current Issuer Cash Manager represents and warrants that at
the date hereof (and in respect of the software which is to be
used by the Current Issuer Cash Manager in providing the Current
Issuer Cash Management Services) it has in place all necessary
licences and/or consents from the respective licensor or
licensors (if any) of such software.
(b) The Current Issuer Cash Manager undertakes that it shall for the
duration of this Agreement, use reasonable endeavours to:
(i) ensure that the licences and/or consents referred to in
paragraph (a) are maintained in full force and effect;
and
(ii) except insofar as it would breach any other of its legal
obligations, grant to any person to whom it may
sub-contract or delegate the performance of all or any of
its powers and obligations under this Agreement (and/or
to such person as the Current Issuer and the Note Trustee
elects as a substitute cash manager in accordance with
the terms of this Agreement) a licence to use any
proprietary software together with any updates which may
be made thereto from time to time.
(c) The Current Issuer Cash Manager shall use reasonable endeavours
to maintain in working order the information technology systems
used by the Current
10
Issuer Cash Manager in providing the Current Issuer Cash
Management Services.
(d) The Current Issuer Cash Manager shall pass to any person to whom
it may sub-contract or delegate the performance of all or any of
its powers and obligations under this Agreement (and/or to such
person as the Current Issuer and the Note Trustee elects as a
substitute cash manager in accordance with the terms of this
Agreement) the benefit of any warranties in relation to such
software insofar as the same are capable of assignment.
8.2 Bank Account Statements: The Current Issuer Cash Manager shall take all
reasonable steps to ensure that it receives a monthly bank statement in
relation to each Current Issuer Transaction Account and Swap Collateral
Cash Account and that it furnishes a copy of such statements to the
Current Issuer, with a copy to the Note Trustee upon its request.
8.3 Access to Books and Records: Subject to all applicable laws, the
Current Issuer Cash Manager shall permit the Current Issuer, the
Auditors of the Current Issuer, the Note Trustee and/or any other
person nominated by the Note Trustee (to whom the Current Issuer Cash
Manager has no reasonable objection) at any time during normal office
hours upon reasonable notice to have access, or procure that such
person or persons are granted access, to all books of record and
account relating to the Current Issuer Cash Management Services
provided by the Current Issuer Cash Manager and related matters in
accordance with this Agreement.
8.4 Statutory Obligations: The Current Issuer Cash Manager will use its
reasonable endeavours, on behalf of the Current Issuer, to prepare or
procure the preparation of and file all reports, annual returns,
financial statements, statutory forms and other returns which the
Current Issuer is required by law to prepare and file. Subject to
approval thereof by the directors of the Current Issuer, the Current
Issuer Cash Manager shall cause such accounts to be audited by the
Auditors and shall procure so far as it is able so to do that the
Auditors shall make a report thereon as required by law, and copies of
all such documents shall be delivered to the Note Trustee, the Current
Issuer and the Rating Agencies as soon as practicable after the end of
each accounting reference period of the Current Issuer.
8.5 Information Covenants:
(a) The Current Issuer Cash Manager shall provide the Current
Issuer, the Note Trustee, the Seller and the Rating Agencies
quarterly with a report in, or substantially in, the form set
out in Schedule 3 in respect of the Current Issuer. Such
quarterly report shall be delivered to the Current Issuer, the
Note Trustee (upon its request), the Seller and the Rating
Agencies by the last Business Day of the month in which each
Payment Date occurs.
(b) The Current Issuer Cash Manager shall provide, or procure the
provision of, to the Current Issuer, the Note Trustee and the
Rating Agencies copies of any annual returns or financial
statements referred to in Clause 8.4 (Statutory Obligations) as
soon as reasonably practicable after the preparation thereof.
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(c) The Current Issuer Cash Manager shall notify the Rating Agencies
and the Note Trustee in writing of the details of (i) any
material amendment to the Transaction Documents to which the
Current Issuer is a party and of which it is or becomes aware,
(ii) the occurrence of a Current Issuer Note Event of Default,
or a Current Issuer Intercompany Loan Event of Default or a
Current Issuer Cash Manager Termination Event (as defined in
Clause 12.1 (Current Issuer Cash Manager Termination Events))
and (iii) any other information relating to the Current Issuer
Cash Manager as the Rating Agencies and the Note Trustee may
reasonably request in connection with its obligations under this
Agreement, PROVIDED THAT the Note Trustee shall not make such a
request more than once every three months unless, in the belief
of the Note Trustee, a Current Issuer Intercompany Loan Event of
Default, a Current Issuer Note Event of Default or a Current
Issuer Cash Manager Termination Event shall have occurred and is
continuing or may reasonably be expected to occur, and PROVIDED
FURTHER THAT any such request by the Note Trustee does not
adversely interfere with the Current Issuer Cash Manager's
day-to-day provision of the Current Issuer Cash Management
Services under the other terms of this Agreement.
(d) After becoming aware of any event described in paragraph (c)(i)
or (ii) above, the Current Issuer Cash Manager shall give
details to the Current Issuer and the Note Trustee of any
pending legal action and any judgments given in respect of the
Current Issuer Cash Manager if it could have a potential
material adverse effect on the ability of the Current Issuer
Cash Manager to perform its obligations hereunder.
(e) The Current Issuer Cash Manager shall, at the request of the
Note Trustee, furnish the Note Trustee and the Rating Agencies
with such other information relating to its business and
financial condition as the Note Trustee may request in
connection with this Agreement, PROVIDED THAT the Note Trustee
shall not make such a request more than once every three months
unless, in the belief of the Note Trustee, a Current Issuer
Intercompany Loan Event of Default, a Current Issuer Note Event
of Default or a Current Issuer Cash Manager Termination Event
(as defined in Clause 12.1 (Current Issuer Cash Manager
Termination Events)) shall have occurred and is continuing or
may reasonably be expected to occur, and PROVIDED FURTHER THAT
any such request of the Note Trustee does not adversely
interfere with the Current Issuer Cash Manager's day-to-day
provision of the Current Issuer Cash Management Services under
the other terms of this Agreement.
9. Remuneration
9.1 Fee payable:
(a) Subject to paragraph (b) below, the Current Issuer shall pay to
the Current Issuer Cash Manager for the provision of the Current
Issuer Cash Management Services hereunder a cash management fee
which shall be agreed in writing between the Current Issuer, the
Note Trustee and the Current Issuer Cash Manager from time to
time.
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(b) Unless and until otherwise agreed by the Current Issuer and the
Note Trustee in writing (notified to the Current Issuer Cash
Manager), the Current Issuer shall be solely responsible for
paying the cash management fee to the Current Issuer Cash
Manager which is referred to in paragraph (a) above.
9.2 Payment of fee: The cash management fee referred to in Clause 9.1 (Fee
Payable) shall only be payable to the Current Issuer Cash Manager on
each Payment Date in the manner contemplated by, in accordance with and
subject to the provisions of the Current Issuer Pre-Enforcement Revenue
Priority of Payments or, as the case may be, the Current Issuer
Post-Enforcement Priority of Payments.
10. Covenants, Representations and Warranties of Current Issuer Cash
Manager
10.1 Covenants: The Current Issuer Cash Manager hereby covenants with and
undertakes to each of the Current Issuer and the Note Trustee that
without prejudice to any of its specific obligations hereunder:
(a) it will exercise all due skill, care and diligence to the
performance of its obligations and the exercise of its
discretions hereunder;
(b) it will comply with any proper directions, orders and
instructions which the Current Issuer or the Note Trustee 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 Note Trustee shall prevail;
(c) it will obtain and keep in force all licences, approvals,
authorisations and consents which are necessary in connection
with the performance of the Current Issuer Cash Management
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
Current Issuer Cash Management Services;
(d) it will not knowingly fail to comply with any legal requirements
in the performance of the Current Issuer Cash Management
Services;
(e) it will make all payments required to be made by it pursuant to
this Agreement on the due date for payment thereof for value in
the specified currency on such day without set-off (including,
without limitation, in respect of any fees owed to it) or
counterclaim; and
(f) it will not without the prior written consent of the Note
Trustee amend or terminate any of the Current Issuer Transaction
Documents save in accordance with their terms.
10.2 Duration of covenants: The covenants of the Current Issuer Cash Manager
in Clause 10.1 (Covenants) shall remain in force until this Agreement
is terminated but without prejudice to any right or remedy of the
Current Issuer and/or the Note Trustee arising from breach of any such
covenant prior to the date of termination of this Agreement.
10.3 Representations and Warranties: The Current Issuer Cash Manager hereby
makes the representations and warranties to each of the Current Issuer
and the Note Trustee
13
that are specified on Schedule 5 hereto.
11. Current Issuer Cash Management Services Non-Exclusive
Nothing in this Agreement shall prevent the Current Issuer Cash Manager
from rendering or performing services similar to those provided for in
this Agreement to or for itself or other persons, firms or companies or
from carrying on business similar to or in competition with the
business of the Current Issuer or the Note Trustee.
12. Termination
12.1 Current Issuer Cash Manager Termination Events: If any of the following
events ("Current Issuer Cash Manager Termination Events") shall occur:
(a) default is made by the Current Issuer Cash Manager 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 (5) London Business Days after the earlier of the
Current Issuer Cash Manager becoming aware of such default and
receipt by the Current Issuer Cash Manager of written notice
from the Current Issuer or the Note Trustee, as the case may be,
requiring the same to be remedied; or
(b) default is made by the Current Issuer Cash Manager in the
performance or observance of any of its other covenants and
obligations under this Agreement, which in the opinion of the
Note Trustee is materially prejudicial to the interests of the
holders of the Current Issuer Notes and such default continues
unremedied for a period of twenty (20) days after the earlier of
the Current Issuer Cash Manager becoming aware of such default
and receipt by the Current Issuer Cash Manager of written notice
from the Note Trustee requiring the same to be remedied; or
(c) the Current Issuer Cash Manager suffers an Insolvency Event,
then the Current Issuer and/or Note Trustee may at once or at any time
thereafter while such default continues by notice in writing to the
Current Issuer Cash Manager with a copy to the Current Issuer Account
Bank terminate its appointment as Current Issuer Cash Manager under
this Agreement with effect from a date (not earlier than the date of
the notice) specified in the notice.
Upon termination of the appointment of the Current Issuer Cash Manager,
the Note Trustee agrees to use its reasonable endeavours to appoint a
substitute Current Issuer Cash Manager. Any substitute Current Issuer
Cash Manager must agree to enter into an agreement substantially on the
same terms as the relevant provisions of this Agreement or on such
terms as are satisfactory to the Current Issuer and the Note Trustee.
Any termination of the appointment of the Current Issuer Cash Manager
and the appointment of a substitute Current Issuer Cash Manager under
this Clause 12.1 is conditional upon the Rating Agencies having
previously confirmed in writing to the Current Issuer and the Note
Trustee that the then-current ratings of the Current Issuer Notes will
not be downgraded, withdrawn or qualified.
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The Note Trustee shall have no liability to any person in the event
that, having used reasonable endeavours, it is unable to appoint a
substitute Current Issuer Cash Manager. In any event, the Note Trustee
shall only be required to use its reasonable endeavours to appoint such
substitute Current Issuer Cash Manager. Notwithstanding any other
provision of the Transaction Documents, the Note Trustee shall not
itself be required to perform any duties of the Current Issuer Cash
Manager.
The Note Trustee shall not be obliged to monitor or supervise the
performance by any substitute Current Issuer Cash Manager of its duties
hereunder or in relation to the other Transaction Documents nor shall
the Note Trustee be responsible or liable for any act or omission of
any substitute Current Issuer Cash Manager or for any loss caused
thereby.
12.2 Resignation of Current Issuer Cash Manager: The Current Issuer Cash
Manager may resign from its appointment under this Agreement only upon
giving not less than twelve (12) months' notice to each of the Current
Issuer and the Note Trustee, PROVIDED THAT:
(a) the Current Issuer and the Note Trustee each consent in writing
to such resignation;
(b) a substitute cash manager shall be appointed, such appointment
to be effective not later than the effective date of such
resignation;
(c) such substitute cash manager enters into an agreement
substantially on the same terms as the relevant provisions of
this Agreement or on such terms as are satisfactory to the
Current Issuer and the Note Trustee, and the Current Issuer Cash
Manager shall not be released from its obligations under the
relevant provisions of this Agreement until such substitute cash
manager has entered into such new agreement and the rights of
the Current Issuer under such agreement are charged in favour of
the Note Trustee on terms satisfactory to the Note Trustee; and
(d) the Rating Agencies have confirmed to the Current Issuer and the
Note Trustee that the then-current ratings of the Current Issuer
Notes are not adversely affected as a result thereof.
12.3 Effect of Termination or Resignation:
(a) On and after termination or resignation of the appointment of
the Current Issuer Cash Manager under this Agreement pursuant to
this Clause 12, all authority and power of the Current Issuer
Cash Manager under this Agreement shall be terminated and be of
no further effect and the Current Issuer Cash Manager shall not
thereafter hold itself out in any way as the agent of the
Current Issuer or the Note Trustee pursuant to this Agreement.
(b) Upon termination or resignation of the appointment of the
Current Issuer Cash Manager under this Agreement pursuant to
this Clause 12, the Current Issuer Cash Manager shall:
15
(i) forthwith deliver (and in the meantime hold on trust for,
and to the order of, the Current Issuer or the Note
Trustee, as the case may be) to the Current Issuer or the
Note Trustee, as the case may be or as it shall direct,
all books of account, papers, records, registers,
correspondence and documents in its possession or under
its control relating to the affairs of or belongings of
the Current Issuer or the Note Trustee, as the case may
be, (if practicable, on the date of receipt) any monies
then held by the Current Issuer Cash Manager on behalf of
the Current Issuer, the Note Trustee and any other assets
of the Current Issuer and the Note Trustee;
(ii) take such further action as the Current Issuer or the
Note Trustee, as the case may be, may reasonably direct
PROVIDED THAT the Note Trustee shall not be required to
take or direct to be taken such further action unless it
has been indemnified to its satisfaction (and in the
event of a conflict between the directions of Current
Issuer and the Note Trustee, the directions of the Note
Trustee shall prevail);
(iii) 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
(iv) co-operate and consult with and assist the Current Issuer
or the Note Trustee or its nominee, as the case may be,
(which shall, for the avoidance of doubt, include any
Receiver appointed by it) 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 Current Issuer or the Note Trustee
or such nominee, as the case may be.
12.4 Notice of event of default: The Current Issuer Cash Manager shall
deliver to the Current Issuer and the Note Trustee as soon as
reasonably practicable (but in any event within three London Business
Days of becoming aware thereof) a notice of any Current Issuer Cash
Manager Termination Event, any Current Issuer Note Event of Default or
any Current Issuer Intercompany Loan Event of Default, or any event
which with the giving of notice or expiry of any grace period or
certification, as specified in such Current Issuer Cash Manager
Termination Event or Current Issuer Note Event of Default or Current
Issuer Intercompany Loan Event of Default, would constitute the same.
12.5 General provisions relating to termination:
(a) Termination of this Agreement or the appointment of the Current
Issuer Cash Manager under this Agreement shall be without
prejudice to the liabilities of the Current Issuer to the
Current Issuer Cash Manager and vice versa incurred before the
date of such termination. The Current Issuer Cash Manager shall
have no right of set-off or any lien in respect of such amounts
against amounts held by it on behalf of the Current Issuer or
the Note Trustee.
(b) This Agreement shall terminate at such time as the Current
Issuer Secured Obligations have been fully discharged.
16
(c) On termination of the appointment of the Current Issuer Cash
Manager under the provisions of this Clause 12, the Current
Issuer Cash Manager shall be entitled to receive all fees and
other monies accrued up to (but excluding) the date of
termination but shall not be entitled to any other or further
compensation. The Current Issuer shall pay such moneys so
receivable by the Current Issuer Cash Manager in accordance with
the Current Issuer Pre-Enforcement Revenue Priority of Payments
or, as the case may be, the Current Issuer Post-Enforcement
Priority of Payments, on the dates on which they would otherwise
have fallen due hereunder. For the avoidance of doubt, such
termination shall not affect the Current Issuer Cash Manager's
rights to receive payment of all amounts (if any) due to it from
the Current Issuer other than under this Agreement.
(d) Any provision of this Agreement, which is stated to continue
after termination of the Agreement, shall remain in full force
and effect notwithstanding termination.
13. Further Assurances
13.1 Co-operation, etc: 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 and the other Transaction
Documents.
13.2 Powers of attorney: Without prejudice to the generality of Clause 13.1
(Co-operation, etc), the Current Issuer shall upon request by the
Current Issuer Cash Manager forthwith give to the Current Issuer Cash
Manager such further powers of attorney or other written
authorisations, mandates or instruments as are necessary to enable the
Current Issuer Cash Manager to perform the Current Issuer Cash
Management Services.
14. Miscellaneous
14.1 No set-off: The Current Issuer Cash Manager agrees that it will not:
(a) set off or purport to set off any amount which either the
Current Issuer is or will become obliged to pay to it under this
Agreement against any amount from time to time standing to the
credit of or to be credited to the Current Issuer Transaction
Accounts or the Swap Collateral Accounts or any replacement or
additional bank account of the Current Issuer and established
from time to time; 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 standing to the credit of the Current Issuer Transaction
Accounts or the Swap Collateral Accounts or any replacement or
additional bank account of the Current Issuer and established
from time to time.
17
14.2 No recourse:
(a) In relation to all sums due and payable by the Current Issuer to
the Current Issuer Cash Manager, the Current Issuer Cash Manager
agrees that it shall have recourse only to sums paid to or
received by (or on behalf of) the Current Issuer pursuant to the
provisions of the Current Issuer Transaction Documents.
(b) For the avoidance of doubt, the Note Trustee shall not be liable
to pay any amounts due under Clauses 7 (Costs and Expenses) and
9 (Remuneration), but without prejudice to the obligations of
the Current Issuer, or any receiver appointed pursuant to the
Current Issuer Deed of Charge in respect of such amounts.
(c) Notwithstanding any other provisions of this Agreement, all
obligations to, and rights of, the Note Trustee under or in
connection with this Agreement (other than its obligations under
Clause 13 (Further Assurances)) shall automatically terminate
upon the discharge in full of all Current Issuer Secured
Obligations, PROVIDED THAT this shall be without prejudice to
any claims in respect of such obligations and rights arising on
or prior to such date.
15. Confidentiality
During the continuance of this Agreement or after its termination, each
of the Current Issuer, the Current Issuer Cash Manager and the Note
Trustee shall use its best endeavours not to disclose to any person,
firm or company whatsoever any information relating to the business,
finances or other matters of a confidential nature of any other party
hereto of which it may exclusively 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 15 shall not apply:
(a) to any information already known to the recipient otherwise than
as a result of entering into any of the Transaction Documents;
(b) to any information subsequently received by the recipient 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 recipient;
(d) to any extent that the recipient is required to disclose the
same 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 the recipient needs to disclose the same for
determining the existence of, or declaring, a Current Issuer
Note Event of Default, or a Current Issuer Cash Manager
Termination Event, the protection or enforcement of any of its
rights under any of the Current Issuer Transaction Documents or
in
18
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 recipient or (in connection with a prospective
rating of any debt to be issued by the Current Issuer or any New
Issuer) to any credit rating agency or any prospective new cash
manager or prospective new Note Trustee.
16. 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.
17. Assignment
17.1 Assignment by the Current Issuer: The Current Issuer may not assign or
transfer any of its rights and obligations under this Agreement without
the prior written consent of each of the Note Trustee and the Current
Issuer Cash Manager, except that the Current Issuer may assign its
respective rights hereunder without such consent pursuant to the
Current Issuer Deed of Charge.
17.2 No assignment by Current Issuer Cash Manager: The Current Issuer Cash
Manager may not assign or transfer any of its rights and obligations
under this Agreement without the prior written consent of the Current
Issuer and the Note Trustee.
18. The Note Trustee
18.1 Change in Note Trustee: If there is any change in the identity of the
note trustee in accordance with the Issuer Deed of Charge, the Current
Issuer and the Current Issuer Cash Manager shall execute such documents
and take such action as the successor note trustee and the outgoing
Note Trustee may require for the purpose of vesting in the successor
note trustee the rights and obligations of the outgoing Note Trustee
under this Agreement and releasing the outgoing Note Trustee from its
future obligations under this Agreement.
18.2 No Obligations: It is hereby acknowledged and agreed that by its
execution of this Agreement the Note Trustee shall not assume or have
any of the obligations or liabilities of the Current Issuer or the
Current Issuer Cash Manager under this Agreement. Furthermore, any
liberty or power which may be exercised or any determination which may
be made hereunder by the Note Trustee may be exercised or made in the
Note Trustee's absolute and unfettered discretion without any
obligation to give reasons therefor, but in any event must be exercised
or made in accordance with the provisions of the Current Issuer Deed of
Charge.
19. Non Petition Covenant; Limited Recourse
19.1 Note Trustee to Enforce: The Current Issuer Cash Manager hereby
undertakes to each of the other parties hereto that only the Security
Trustee, at the direction of the Note Trustee, may enforce the security
created in favour of the Note Trustee by the
19
Current Issuer Deed of Charge in accordance with the provisions
thereof.
19.2 Limited Recourse: The Current Issuer Cash Manager hereby undertakes to
each of the other parties hereto that, notwithstanding any other
provision of this Agreement or any other Transaction Document, no sum
due or owing to the Current Issuer Cash Manager from or by the Current
Issuer under this Agreement shall be payable by the Current Issuer
except to the extent that the Current Issuer has sufficient funds
available or (following enforcement of the Current Issuer Security) the
Security Trustee has realised sufficient funds from the Current Issuer
Security to pay such sum subject to and in accordance with the relevant
Current Issuer Priority of Payments, and provided that all liabilities
of the Current Issuer required to be paid in priority thereto or pari
passu therewith pursuant to such Current Issuer Priority of Payments
have been paid, discharged and/or otherwise provided for in full.
19.3 Non Petition: The Current Issuer Cash Manager hereby undertakes to each
of the other parties hereto that it shall not take any steps for the
purpose of recovering any amount payable under this Agreement
(including, without limitation, by exercising any rights of set-off) or
enforcing any rights arising out of this Agreement against the Current
Issuer and it shall not take any steps or legal proceedings for the
winding-up, dissolution or reorganisation of, or the institution of
insolvency proceedings against, the Current Issuer or for the
appointment of a receiver, administrator, liquidator or similar officer
of the Current Issuer in respect of any or all of its revenues except
to the extent expressly permitted under the Current Issuer Deed of
Charge.
19.4 Following Enforcement: The Current Issuer Cash Manager hereby
undertakes to each of the other parties hereto that, following any
enforcement of the Current Issuer Security, it will hold on trust for,
and will pay to, the Note Trustee or the Receiver, as the case may be,
all monies received or recovered by it (whether by way of set-off or
otherwise) otherwise than in accordance with the Current Issuer
Post-Enforcement Priority of Payments in order that such monies may be
applied by the Note Trustee or the Receiver in accordance with the
Current Issuer Post-Enforcement Priority of Payments.
19.5 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 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.
19.6 Current Issuer Deed of Charge: The provisions of Clause 6 of the
Current Issuer Deed of Charge shall prevail in the event that and to
the extent that they conflict with the provisions of this Clause 19.
20
20. Amendments and Waiver
20.1 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 Current Issuer Transaction Documents.
20.2 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.
20.3 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.
20.4 Ratings: 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.
21. 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 (London time) 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 Current Issuer Cash Manager, 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 Current Issuer, to Granite Mortgages 03-2 plc
x/x Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile
number 020 7606 0643) for the attention of The Company Secretary
with a copy 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;
(c) in the case of the Note Trustee, to The Bank of New York (London
Branch), at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX
(facsimile number 020 7964 6399) for the attention of Corporate
Trust (Global Structured Finance);
21
(d) in the case of Fitch, to Fitch Ratings Ltd., at Xxxxx Xxxxx, 0
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 0207 417 6262)
for the attention of European Structured Finance Surveillance;
(e) 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 0207 772 5400) for the attention of the Head
of Monitoring Group, Structured Finance;
(f) 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 0207 826
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 21. All notices served
under this Agreement shall be simultaneously copied to the Note Trustee
by the person serving the same.
22. 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.
23. Execution in Counterparts; Severability
23.1 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.
23.2 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 such provision or obligation in
any other jurisdiction, shall not be affected or impaired thereby.
24. Governing Law and Jurisdiction; Appropriate Forum
24.1 Governing Law: This Agreement is governed by, and shall be construed in
accordance with, English law.
24.2 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.
24.3 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
22
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 the
day and year first before written.
23
SCHEDULE 1
The Current Issuer Cash Management Services
The Current Issuer Cash Manager shall:
(a) make the determinations as set forth in Schedule 2;
(b) invest sums, if any, standing to the credit of the Current Issuer
Transaction Accounts in short-term Authorised Investments as determined
by the Current Issuer and, if applicable, the Note Trustee;
(c) apply the Current Issuer Available Revenue Receipts and Current Issuer
Available Principal Receipts in accordance with the relevant order of
priority of payments for the Current Issuer set out in Schedule 2;
(d) maintain the Current Issuer Principal Deficiency Ledger, and record (1)
principal deficiencies arising from Losses on the Mortgage Loans which
have been allocated by Funding to the Current Issuer Intercompany Loan,
(2) the use of Current Issuer Principal Receipts to meet any deficiency
in Current Issuer Revenue Receipts and (3) the use of Funding Available
Principal Receipts to fund or replenish, as the case may be, the
Current Issuer Liquidity Reserve Fund, if any;
(e) each time it records a debit on a Current Issuer Principal Deficiency
Sub Ledger, also record on such Current Issuer Principal Deficiency Sub
Ledger whether such debit was caused by (1) Losses on the Mortgage
Loans which have been allocated by Funding to the Current Issuer
Intercompany Loan, (2) the application of Current Issuer Principal
Receipts to meet any deficiency in Current Issuer Revenue Receipts, or
(3) the application of Funding Available Principal Receipts to fund or
replenish, as the case may be, the Current Issuer Liquidity Reserve
Fund, if any;
(f) provide the Current Issuer, Funding, the Note Trustee (upon its
request) and the Rating Agencies with quarterly reports in relation to
the Current Issuer as set out in Schedule 3;
(g) operate the Current Issuer Bank Accounts and ensure that payments are
made into and from such account in accordance with this Agreement, the
Current Issuer Deed of Charge, the Current Issuer Bank Account
Agreement and any other relevant Current Issuer Transaction Document,
PROVIDED HOWEVER THAT nothing herein shall require the Current Issuer
Cash Manager to make funds available to the Current Issuer to enable
such payments to be made other than as expressly required by the
provisions of this Agreement;
(h) keep records for all taxation purposes (including, without limitation
VAT);
(i) subject to any applicable law, assist the auditors of the Current
Issuer and provide such information to them as they may reasonably
request for the purpose of carrying out their duties as auditors;
(j) make all returns and filings, give all notices and make all
registrations and other notifications required in the day-to-day
operation of the business of the Current Issuer
24
or required to be given by the Current Issuer pursuant to the Current
Issuer Transaction Documents;
(k) arrange for all payments due to be made by the Current Issuer under any
of the Current Issuer Transaction Documents, PROVIDED THAT such moneys
are at the relevant time available to the Current Issuer and PROVIDED
FURTHER that nothing herein shall constitute a guarantee by the Current
Issuer Cash Manager of all or any of the obligations of the Current
Issuer under any of the Current Issuer Transaction Documents;
(l) without prejudice to the role of and in conjunction with the Current
Issuer Corporate Services Provider under the Current Issuer Corporate
Services Agreement, keep general books of account and records of the
Current Issuer; provide accounting services, including reviewing
receipts and payments, supervising and assisting in the preparation of
interim statements and final accounts and supervising and assisting in
the preparation of tax returns;
(m) without prejudice to the role of and in conjunction with the Current
Issuer Corporate Services Provider under the Current Issuer Corporate
Services Agreement, provide or procure the provision of company
secretarial and administration services to the Current Issuer including
the keeping of all registers and the making of all returns and filings
required by applicable law or by UK regulatory authorities, co-operate
in the convening of board and general meetings and provide registered
office facilities;
(n) itself on behalf of the Current Issuer, PROVIDED THAT such monies are
at the relevant time available to the Current Issuer, pay all the
out-of-pocket expenses of the Current Issuer, incurred by the Current
Issuer Cash Manager on behalf of the Current Issuer in the performance
of the Current Issuer Cash Manager's duties hereunder including without
limitation:
(i) all Taxes which may be due or payable by the Current Issuer;
(ii) all necessary filing and other fees in compliance with
regulatory requirements;
(iii) all legal and audit fees and other professional advisory fees;
and
(iv) all communication expenses including postage, courier and
telephone charges,
(o) the Current Issuer Cash Manager may invest monies standing from time to
time to the credit of the Current Issuer Transaction Accounts subject
to the following provisions:
(i) any such Authorised Investment shall be made in the joint names
of the Current Issuer and the Note Trustee;
(ii) any costs properly and reasonably incurred in making and
changing Authorised Investments will be reimbursed to the
Current Issuer Cash Manager and the Note Trustee by the Current
Issuer;
(iii) all income or proceeds following the disposal or maturity of
Authorised Investments shall be credited to the Current Issuer
Transaction Accounts from which moneys were withdrawn to make
the relevant Authorised Investment; and
25
(iv) following the enforcement of the Current Issuer Security no such
investment may be made without the prior written consent of the
Note Trustee.
The Note Trustee and the Current Issuer Cash Manager shall not be
responsible (save where any loss results from the Note Trustee's or the
Current Issuer Cash Manager's own fraud, wilful default or gross
negligence or that of its officers or employees) for any loss
occasioned by reason of any such Authorised Investments whether by
depreciation in value or otherwise provided that such Authorised
Investments were made in accordance with the above provisions;
(p) (i) if necessary, perform all currency conversions free of charge,
cost or expense at the relevant exchange rate; and
(ii) if necessary, perform all interest rate conversions free of
charge, cost or expense at the relevant interest swap rate.
for the purposes of any calculations referred to in sub-paragraphs (i)
and (ii) above, all percentages resulting from such calculations will
be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point (e.g. 9.876541% (or 0.09876541) being rounded down to
9.87654% (or 0.0987654)) and (ii) any currency amounts used in or
resulting from such calculations will be rounded in accordance with the
relevant market practice;
(q) arrange payment of all fees to the London Stock Exchange plc or, as
applicable, the UK Listing Authority; and
(r) provide services in relation to Swap Collateral (including, without
limitation, in connection with the transfer, receipt, administration
and/or holding of Swap Collateral, the making of calculations,
determinations, communications or valuations, the opening and
maintenance of the Swap Collateral Accounts and the Swap Collateral
Ledger; and the entering into of Swap Collateral Ancillary Documents).
26
SCHEDULE 2
Cash Management and Maintenance of Ledgers
1. Determination
(a) On or before each Current Issuer Note Determination Date
immediately preceding a Payment Date, the Current Issuer Cash
Manager shall determine each of the following in accordance with
this paragraph 1:
(i) the amount of any Current Issuer Available Revenue
Receipts to be applied on the following Payment Date in
accordance with the Current Issuer Pre-Enforcement
Revenue Priority of Payments set forth in paragraph 3 of
this Schedule 2;
(ii) the amount of any Current Issuer Available Principal
Receipts to be applied on the following Payment Date in
accordance with the Current Issuer Pre-Enforcement
Principal Priority of Payments set forth in paragraph 4
of this Schedule 2;
(iii) whether there will be an excess or a deficit of the
Current Issuer Available Revenue Receipts to pay items
(A) through (O) of the Current Issuer Pre-Enforcement
Revenue Priority of Payments (after taking account of any
Shared Issuer Revenue Receipts available therefor) as set
forth in paragraph 3 of this Schedule 2;
(iv) the various amounts, balances and rates to be calculated
in accordance with the Current Issuer Swap Agreements,
and shall promptly notify the Current Issuer, the Note
Trustee and each Calculation Agent (as defined in each
Current Issuer Swap Agreement) of such amounts, balances
and rates; and
(v) the Principal Amount Outstanding of the Current Issuer
Notes, the Pool Factor, and the Note Principal Payment of
the Current Issuer Notes in accordance with the
Conditions.
(b) If the Current Issuer Cash Manager determines (as set forth in
paragraph 1(a)(iii)) that there is a Current Issuer Income
Deficit and the Current Issuer has provided for that deficit by
the application of funds standing to the credit of the Current
Issuer Principal Ledger, if any, then the Current Issuer Cash
Manager shall make a corresponding debit entry in the relevant
Current Issuer Principal Deficiency Sub Ledger, PROVIDED THAT
the Current Issuer Cash Manager shall ensure that Current Issuer
Principal Receipts are not used to pay interest on any class of
Current Issuer Notes if and to the extent that would result in a
deficiency being recorded, or an existing deficiency being
increased, on a Current Issuer Principal Deficiency Sub Ledger
relating to a higher ranking Class of Current Issuer Notes, and
furthermore that Current Issuer Principal Receipts are not used
to make up any deficit other than in respect of items (A)
through (E), (G), (I) and (K) of the Current Issuer
Pre-Enforcement Revenue Priority of Payments. The Current Issuer
Cash
27
Manager shall thereafter record as a debit on the Current Issuer
Revenue Ledger the application by the Current Issuer of any
excess Current Issuer Available Revenue Receipts to extinguish
any balance on a Current Issuer Principal Deficiency Sub Ledger.
(c) The Current Issuer Cash Manager may make all the determinations
referred to in paragraph 1(a) on the basis of any reasonable and
proper assumptions as the Current Issuer Cash Manager considers
appropriate (including without limitation as to the amount of
any payments to be made under paragraph 3 below during the
period from and including the Current Issuer Note Determination
Date immediately preceding a Payment Date to but excluding such
Payment Date).
The Current Issuer Cash Manager shall notify the Current Issuer
and the Note Trustee on request of any such other assumptions
and shall take account of any representations made by the
Current Issuer and the Note Trustee (as the case may be) in
relation thereto.
(d) Each determination made in accordance with this paragraph 1
shall (in the absence of bad faith, wilful default, negligence
and manifest error) be final and binding on all persons.
2. Notification of Determinations
(a) The Current Issuer Cash Manager will cause each determination of
Current Issuer Available Principal Receipts and Current Issuer
Available Revenue Receipts (in accordance with paragraph 1(a)(i)
and (ii)) and any Current Issuer Income Deficit (in accordance
with paragraph 1(a)(iii)) to be notified forthwith, following
the calculation thereof, to the Current Issuer.
(b) The Current Issuer Cash Manager shall procure that the
determinations and notifications required to be made pursuant to
Condition 5(C) of the Conditions are made.
3. Priority of Payments for Current Issuer Available Revenue Receipts
Current Issuer Available Revenue Receipts will be applied, as
applicable:
(a) on each Payment Date; or
(b) on each day when due in respect of amounts due to third parties
pursuant to paragraph (C) below,
in each case prior to the enforcement of the Current Issuer Security
pursuant to the Current Issuer Deed of Charge or until such time as
there are no Current Issuer Secured Obligations outstanding, in making
such payments and provisions in the following order of priority (in
each case only if and to the extent that payments or
provisions of a higher priority have been made in full) (the "Current
Issuer Pre-Enforcement Revenue Priority of Payments"):
28
(A) first, to pay amounts due to the Note Trustee, together with
interest and (to the extent not already inclusive) VAT on those
amounts, and to provide for any amounts due or to become due
during the following Interest Period to the Note Trustee under
the Current Issuer Trust Deed, the Current Issuer Deed of Charge
or any other Transaction Document;
(B) second, in no order of priority between them but in proportion
to the respective amounts due, to pay amounts due to the Agent
Bank, the Paying Agents, the Transfer Agent and the Registrar,
together with interest and (to the extent not already inclusive)
VAT on those amounts, and to provide for any costs, charges,
liabilities and expenses due or to become due during the
following Interest Period to the Agent Bank, the Paying Agents,
the Transfer Agent and the Registrar under the Current Issuer
Paying Agent and Agent Bank Agreement;
(C) third, to pay amounts due to any third party creditors of the
Current Issuer (other than those referred to later in this order
of priority of payments or in the Current Issuer Pre-Enforcement
Principal Priority of Payments), of which the Current Issuer
Cash Manager has notice prior to the relevant Payment Date,
which amounts have been incurred without breach by the Current
Issuer of the Transaction Documents to which it is a party and
for which payment has not been provided for elsewhere and to
provide for any such amounts expected to become due and payable
during the following Interest Period by the Current Issuer and
to pay or discharge any liability of the Current Issuer for
corporation tax on any chargeable income or gain of the Current
Issuer;
(D) fourth, in no order of priority between them but in proportion
to the respective amounts due, to pay amounts due to the Current
Issuer Cash Manager under the Current Issuer Cash Management
Agreement, the Current Issuer Corporate Services Provider under
the Current Issuer Corporate Services Agreement and the Current
Issuer Account Bank under the Current Issuer Bank Account
Agreement together with (to the extent not already inclusive)
VAT on those amounts, and to provide for any amounts due, or to
become due in the immediately succeeding interest period, to the
Current Issuer Cash Manager under the Current Issuer Cash
Management Agreement, to the Current Issuer Corporate Services
Provider under the Current Issuer Corporate Services Agreement
and to the Current Issuer Account Bank under the Current Issuer
Bank Account Agreement;
(E) fifth, in no order of priority between them but in proportion to
the respective amounts due, to pay:
(1) amounts (including such part of any termination payment)
due to the Current Issuer Basis Rate Swap Provider
(except for any termination payment or any part thereof
due and payable to the Current Issuer Basis Rate Swap
Provider as a result of a Basis Rate Swap Provider
Default, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments);
29
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A1 Dollar
Currency Swap Provider under the Series 1 Class A1 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of interest from the Series 1 Class A1 Dollar
Currency Swap Provider to pay interest due or overdue on
the Series 1 Class A1 Notes to holders of the Series 1
Class A1 Notes;
(3) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A2 Dollar
Currency Swap Provider under the Series 1 Class A2 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of interest from the Series 1 Class A2 Dollar
Currency Swap Provider to pay interest due or overdue on
the Series 1 Class A2 Notes to holders of the Series 1
Class A2 Notes;
(4) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A3 Dollar
Currency Swap Provider under the Series 1 Class A3 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent that such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of interest from the Series 1 Class A3 Dollar
Currency Swap Provider (and, to the extent such amounts
are insufficient to pay interest due or overdue on the
Series 1 Class A3 notes, from amounts comprised in the
Current Issuer Available Revenue Receipts converted into
U.S. Dollars at the then prevailing spot rate of
exchange) to pay interest due or overdue on the Series 1
Class A3 Notes;
(5) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class A Euro
Currency Swap Provider under the Series 2 Class A Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current
30
Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received in respect of
interest from the Series 2 Class A Euro Currency Swap
Provider to pay interest due or overdue on the Series 2
Class A Notes to the holders of the Series 2 Class A
Notes; and
(6) amounts due in respect of interest and such part of any
termination payment due to the Current Issuer Series 3
Class A Interest Rate Swap Provider under the Current
Issuer Series 3 Class A Interest Rate Swap (except for
any termination payment or any part thereof due and
payable to that Swap Provider as a result of an Interest
Rate Swap Provider Default by that Swap Provider, save to
the extent such termination payment may be satisfied by
any Swap Replacement Payment made to the Current Issuer
following a Downgrade Termination Event in respect of the
Current Issuer Series 3 Class A Interest Rate Swap and
applied in accordance with this order of priority of
payments) and from amounts received on each Payment Date
in respect of interest from the Current Issuer Series 3
Class A Interest Rate Swap Provider to pay on such
Payment Date interest due or overdue on the Series 3
Class A Notes to the holders of the Series 3 Class A
Notes, and after the Payment Date in July 2010, amounts
due to pay on each Payment Date interest due or overdue
on the Series 3 Class A Notes to the holders of the
Series 3 Class A Notes;
(F) sixth, towards a credit to the Class A Principal Deficiency Sub
Ledger in an amount up to the amount necessary to eliminate any
debit on the Class A Principal Deficiency Sub Ledger;
(G) seventh, in no order of priority between them but in proportion
to the respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class B Dollar
Currency Swap Provider under the Series 1 Class B Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of interest from the Series 1 Class B Dollar
Currency Swap Provider to pay interest due or overdue on
the Series 1 Class B Notes to the holders of the Series 1
Class B Notes; and
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class B Euro
Currency Swap Provider under the Series 2 Class B Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current
31
Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received in respect of
interest from the Series 2 Class B Euro Currency Swap
Provider to pay interest due or overdue on the Series 2
Class B Notes to the holders of the Series 2 Class B
Notes.
(H) eighth, towards a credit to the Class B Principal Deficiency Sub
Ledger in an amount up to the amount necessary to eliminate any
debit on the Class B Principal Deficiency Sub Ledger;
(I) ninth, to pay amounts due in respect of interest and such part
of any termination payment due to the Series 2 Class M Euro
Currency Swap Provider under the Series 2 Class M Euro Currency
Swap (except for any termination payment or any part thereof due
and payable to that Swap Provider as a result of a Euro Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any swap
replacement payment made to the Current Issuer following a
Downgrade Termination Event in respect of the Series 2 Class M
Euro Currency Swap and applied in accordance with this order of
priority of payments) and from amounts received on each payment
date in respect of interest from the Series 2 Class M Euro
Currency Swap Provider to pay on such payment date interest due
or overdue on the Series 2 Class M Notes to the holders of the
Series 2 Class M Notes;
(J) tenth, towards a credit to the Series 2 Class M Principal
Deficiency Sub Ledger in an amount up to the amount necessary to
eliminate any debit on that ledger;
(K) eleventh, in no order of priority between them but in proportion
to the respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class C Dollar
Currency Swap Provider under the Series 1 Class C Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of interest from the Series 1 Class C Dollar
Currency Swap Provider to pay interest due or overdue on
the Series 1 Class C Notes to the holders of the Series 1
Class C Notes;
(2) amounts due in respect of interest and such part of any
termination payment or any part thereof due to the Series
2 Class C1 Euro Currency Swap Provider under the Series 2
Class C1 Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result
of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
32
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received in respect of
interest from the Series 2 Class C1 Euro Currency Swap
Provider to pay interest due or overdue on the Series 2
Class C1 Notes to the holders of the Series 2 Class C1
Notes;
(3) amounts due in respect of interest and such part of any
termination payment or any part thereof due to the Series
2 Class C2 Euro Currency Swap Provider under the Series 2
Class C2 Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result
of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received in respect of
interest from the Series 2 Class C2 Euro Currency Swap
Provider to pay interest due or overdue on the Series 2
Class C2 Notes to the holders of the Series 2 Class C2
Notes; and
(4) amounts due to pay on each Payment Date interest due or
overdue on the Series 3 Class C Notes to the holders of
the Series 3 Class C Notes;
(L) twelfth, towards a credit to the Class C Principal Deficiency
Sub Ledger in an amount up to the amount necessary to eliminate
any debit on the Class C Principal Deficiency Sub Ledger;
(M) thirteenth, on the Payment Date falling in December of each
year, to pay to the Current Issuer Account Bank an amount equal
to the amount of any debit balance on any Current Issuer
Transaction Account as permitted by the Current Issuer Account
Bank, incurred in accordance with the provisions of the Current
Issuer Transaction Documents and outstanding as at such Payment
Date;
(N) fourteenth, in no order of priority between them but in
proportion to the respective amounts due, to pay any termination
payment to:
(1) the Current Issuer Basis Rate Swap Provider following a
Basis Rate Swap Provider Default;
(2) the Current Issuer Series 3 Class A Interest Swap
Provider following an Interest Rate Swap Provider
Default;
(3) any Dollar Currency Swap Provider following a Dollar
Currency Swap Provider Default; and
(4) any Euro Currency Swap Provider following a Euro Currency
Swap Provider Default;
(O) fifteenth, to pay to the Current Issuer an amount equal to 0.01%
per annum of the interest received under the Current Issuer
Intercompany Loan, to be
33
retained by the Current Issuer as profit, less corporation tax
in respect of those profits provided for or paid at item (C)
above; and
(P) last, to pay to shareholders of the Current Issuer any dividend
declared by the Current Issuer.
If any Swap Collateral Available Revenue Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Revenue Amounts shall be applied by the Current Issuer Cash Manager on
that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Revenue Amounts replace.
If, on any Payment Date, an amount equal to the cash benefit relating
to any Tax Credit obtained by the Current Issuer is required to be paid
by the Current Issuer to any Current Issuer Swap Provider (in
accordance with Part 5(o) of the Schedule to the relevant Current
Issuer Swap Agreement), then the Current Issuer shall make such payment
on such Payment Date out of the Current Issuer Available Revenue
Receipts in priority to the payments and provisions to be made on such
Payment Date in accordance with the Current Issuer Pre-Enforcement
Revenue Priority of Payments. The amount of any such cash benefit paid
to the relevant Current Issuer Swap Provider in accordance with this
paragraph shall, to avoid double counting, be deducted from the amount
to be paid to that Current Issuer Swap Provider under the relevant
Current Issuer Swap Agreement in accordance with the Current Issuer
Pre-Enforcement Revenue Priority of Payments on the relevant Payment
Date.
4. Priority of Payments for Current Issuer Available Principal Receipts
4.1 Distribution of Current Issuer Available Principal Receipts Prior to
Enforcement of the Current Issuer Security
Prior to enforcement of the Current Issuer Security pursuant to the
Current Issuer Deed of Charge and/or the occurrence of a Trigger Event,
or until such time as there are no Current Issuer Notes outstanding,
Current Issuer Available Principal Receipts will be applied in the
following order of priority (the "Current Issuer Pre-Enforcement
Principal Priority of Payments"):
(A) first, amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A1 Dollar Currency
Swap Provider under the Series 1 Class A1 Dollar Currency Swap
(except for any termination payment or any part thereof due and
payable to that Swap Provider as a result of a Dollar Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any Swap
Replacement Payment made to the Current Issuer following a
Downgrade Termination Event and applied in accordance with this
order of priority of payments) and from amounts received in
respect of principal from the Series 1 Class A1 Dollar Currency
Swap Provider to pay up to the Series 1 Class A1 Controlled
Amortisation Amount to the holders of the Series 1 Class A1
Notes;
(B) second, amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A2 Dollar Currency
Swap Provider under
34
the Series 1 Class A2 Dollar Currency Swap (except for any
termination payment or any part thereof due and payable to that
Swap Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order of
priority of payments) and from amounts received in respect of
principal from the Series 1 Class A2 Dollar Currency Swap
Provider to pay up to the Series 1 Class A2 Controlled
Amortisation Amount to the holders of the Series 1 Class A2
Notes;
(C) third, in no order of priority between them but in proportion to
the amounts due, to pay:
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A3 Dollar
Currency Swap Provider under the Series 1 Class A3 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 1 Class A3 Dollar
Currency Swap Provider to pay up to the Series 1 Class A3
Controlled Amortisation Amount to the holders of the
Series 1 Class A3 Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class A Euro
Currency Swap Provider under the Series 2 Class A Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 2 Class A Euro
Currency Swap Provider to pay up to the Series 2 Class A
Controlled Amortisation Amount to the holders of the
Series 2 Class A Notes; and
(3) up to the Series 3 Class A Controlled Amortisation Amount
to the holders of the Series 3 Class A Notes;
(D) fourth, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied
on such Payment Date (or, if any of the Issuer Reserve
Requirement, the Issuer Arrears Test and the Subordinated
Principal Test are not satisfied on such Payment Date, but the
Class A Notes have been repaid in full), in no order of priority
between them but in proportion to the respective amounts due, to
pay:
35
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class B Dollar
Currency Swap Provider under the Series 1 Class B Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 1 Class B Dollar
Currency Swap Provider to pay up to the Series 1 Class B
Controlled Amortisation Amount to the holders of the
Series 1 Class B Notes; and
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class B Euro
Currency Swap Provider under the Series 2 Class B Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 2 Class B Euro
Currency Swap Provider to pay up to the Series 2 Class B
Controlled Amortisation Amount to the holders of the
Series 2 Class B Notes;
(E) fifth, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied
on such Payment Date (or, if any of the Issuer Reserve
Requirement, the Issuer Arrears Test and the Subordinated
Principal Test are not satisfied on such Payment Date, but the
Class A Notes have been repaid in full) to pay amounts due in
respect of principal and such part of any termination payment
due to the Series 2 Class M Euro Currency Swap Provider under
the Series 2 Class M Euro Currency Swap (except for any
termination payment or any part thereof due and payable to that
Swap Provider, as a result of a Euro Currency Swap Provider
Default by that Swap Provider save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment made to the Current Issuer following a Downgrade
Termination Event in respect of the Series 2 Class M Euro
Currency Swap and applied in accordance with this order of
priority of payments) and from amounts received in respect of
principal from the Series 2 Class M Euro Currency Swap Provider
to pay up to the Series 2 Class M Controlled Amortization Amount
to the holders of the Series 2 Class B Notes; and
(F) last, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied
on such Payment Date (or, if any of the Issuer Reserve
Requirement, the Issuer Arrears Test and the Subordinated
Principal Test are not satisfied on such Payment Date, but the
Class A Notes have been repaid in full) to pay:
36
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class C Dollar
Currency Swap Provider (except for any termination
payment or any part thereof due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap
Replacement Payment made to the Current Issuer following
a Downgrade Termination Event and applied in accordance
with this order of priority of payments) under the Series
1 Class C Dollar Currency Swap and from amounts received
in respect of principal from the Series 1 Class C Dollar
Currency Swap Provider to pay up to the Series 1 Class C
Controlled Amortisation Amount to the holders of the
Series 1 Class C Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class C1 Euro
Currency Swap Provider under the Series 2 Class C1 Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 2 Class C1 Euro
Currency Swap Provider to pay up to the Series 2 Class C1
Controlled Amortisation Amount to the holders of the
Series 2 Class C1 Notes;
(3) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class C2 Euro
Currency Swap Provider under the Series 2 Class C2 Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment
made to the Current Issuer following a Downgrade
Termination Event and applied in accordance with this
order of priority of payments) and from amounts received
in respect of principal from the Series 2 Class C2 Euro
Currency Swap Provider to pay up to the Series 2 Class C2
Controlled Amortisation Amount to the holders of the
Series 2 Class C2 Notes; and
(4) up to the Series 3 Class C Controlled Amortisation Amount
to the holders of the Series 3 Class C Notes.
The Controlled Amortisation Amount of each class of Current Issuer
Notes for each Payment Date is as set forth on Schedule 4.
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager
on that Payment Date in the same
37
manner as it would have applied the receipts which such Swap Collateral
Available Principal Amounts replace.
4.2 Distribution of Current Issuer Available Principal Receipts Following
the Occurrence of a Non-Asset Trigger Event
Following the occurrence of a Non-Asset Trigger Event but prior to
enforcement of the Funding Security under the Funding Deed of Charge
and/or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will apply Current Issuer
Available Principal Receipts in the following order of priority:
(A) first, to pay amounts (including such part of any termination
payment) due to the Series 1 Class A1 Dollar Currency Swap
Provider under the Series 1 Class A1 Dollar Currency Swap
(except for any termination payment or any part thereof due and
payable to that Swap Provider as a result of a Dollar Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any Swap
Replacement Payment made to the Current Issuer following a
Downgrade Termination Event and applied in accordance with this
order of priority of payments) and from amounts received from
the Series 1 Class A1 Dollar Currency Swap Provider to repay the
Series 1 Class A1 Notes until the Series 1 Class A1 Notes have
been repaid in full;
(B) second, to pay amounts (including such part of any termination
payment) due to the Series 1 Class A2 Dollar Currency Swap
Provider under the Series 1 Class A2 Dollar Currency Swap
(except for any termination payment or any part thereof due and
payable to that Swap Provider as a result of a Dollar Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any Swap
Replacement Payment made to the Current Issuer following a
Downgrade Termination Event and applied in accordance with this
order of priority of payments) and from amounts received from
the Series 1 Class A2 Dollar Currency Swap Provider to repay the
Series 1 Class A2 Notes until the Series 1 Class A2 Notes have
been repaid in full;
(C) third, in no order of priority between them but in proportion to
the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A3 Dollar Currency
Swap Provider under the Series 1 Class A3 Dollar Currency
Swap (except for any termination payment or any part
thereof due and payable to that Swap Provider as a result
of a Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class A3 Dollar Currency Swap Provider to repay the
Series 1 Class A3 Notes until the Series 1 Class A3 Notes
have been repaid in full;
38
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class A Euro Currency Swap
Provider under the Series 2 Class A Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class A Euro Currency Swap Provider to repay the Series 2
Class A Notes until the Series 2 Class A Notes have been
repaid in full; and
(3) to repay the Series 3 Class A Notes until the Series 3
Class A Notes have been repaid in full;
(D) fourth, in no order of priority between them, but in proportion
to the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class B Dollar Currency Swap
Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class B Dollar Currency Swap Provider to repay the Series
1 Class B Notes until the Series 1 Class B Notes have
been repaid in full; and
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class B Euro Currency Swap
Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class B Euro Currency Swap Provider to repay the Series 2
Class B Notes until the Series 2 Class B Notes have been
repaid in full;
(E) fifth, to pay amounts (including such part of any termination
payment) due to the Series 2 Class M Euro Currency Swap Provider
under the Series 2 Class M Euro Currency Swap (except for any
termination payment or any part thereof due and payable to that
Swap Provider, as a result of a Euro Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment, made to the
39
Current Issuer following a Downgrade Termination Event in
respect of the Series 2 Class M Euro Currency Swap and applied
in accordance with this order of priority of payments) and from
amounts received from the Series 2 Class M Euro Currency Swap
Provider to repay the Series 2 Class M Notes until the Series 2
Class M Notes have been repaid in full; and
(F) last, in no order of priority between them, but in proportion to
the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class C Dollar Currency Swap
Provider under the Series 1 Class C Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class C Dollar Currency Swap Provider to repay the Series
1 Class C Notes until the Series 1 Class C Notes have
been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C1 Euro Currency Swap
Provider under the Series 2 Class C1 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class C1 Euro Currency Swap Provider to repay the Series
2 Class C1 Notes until the Series 2 Class C1 Notes have
been repaid in full;
(3) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C2 Euro Currency Swap
Provider under the Series 2 Class C2 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class C2 Euro Currency Swap Provider to repay the Series
2 Class C2 Notes until the Series 2 Class C2 Notes have
been repaid in full; and
(4) to repay the Series 3 Class C Notes until the Series 3
Class C Notes have been repaid in full.
40
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager
on that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Principal Amounts
replace.
4.3 Distribution of Current Issuer Available Principal Receipts Following
the Occurrence of an Asset Trigger Event
Following the occurrence of an Asset Trigger Event but prior to
enforcement of the Funding Security under the Funding Deed of Charge
and/or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will apply Current Issuer
Available Principal Receipts in the following order of priority:
(A) first, in no order of priority between them, but in proportion
to the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A1 Dollar Currency
Swap Provider under the Series 1 Class A1 Dollar Currency
Swap (except for any termination payment or any amount
thereof due and payable to that Swap Provider as a result
of a Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class A1 Dollar Currency Swap Provider to repay the
Series 1 Class A1 Notes until the Series 1 Class A1 Notes
have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A2 Dollar Currency
Swap Provider under the Series 1 Class A2 Dollar Currency
Swap (except for any termination payment or any amount
thereof due and payable to that Swap Provider as a result
of a Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class A2 Dollar Currency Swap Provider to repay the
Series 1 Class A2 Notes until the Series 1 Class A2 Notes
have been repaid in full;
(3) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A3 Dollar Currency
Swap Provider under the Series 1 Class A3 Dollar Currency
Swap (except for any termination payment or any amount
thereof due and payable to that Swap Provider as a result
of a Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied
41
by any Swap Replacement Payment made to the Current
Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class A3 Dollar Currency Swap Provider to repay the
Series 1 Class A3 Notes until the Series 1 Class A3 Notes
have been repaid in full;
(4) to pay amounts (including such part of any termination
payment) due to the Series 2 Class A Euro Currency Swap
Provider under the Series 2 Class A Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class A Euro Currency Swap Provider to repay the Series 2
Class A Notes until the Series 2 Class A Notes have been
repaid in full; and
(5) to repay the Series 3 Class A Notes until the Series 3
Class A Notes have been repaid in full;
(B) second, in no order of priority between them, but in proportion
to the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class B Dollar Currency Swap
Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class B Dollar Currency Swap Provider to repay the Series
1 Class B Notes until the Series 1 Class B Notes have
been repaid in full; and
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class B Euro Currency Swap
Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class B Euro Currency Swap Provider to repay the Series 2
Class B Notes until the Series 2 Class B Notes have been
repaid in full;
42
(C) third, to pay amounts (including such part of any termination
payment) due to the Series 2 Class M Euro Currency Swap Provider
under the Series 2 Class M Euro Currency Swap (except for any
termination payment or any part thereof due and payable to that
Swap Provider as a result of a Euro Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment made to the Current Issuer following a Downgrade
Termination Event in respect of the Series 2 Class M Euro
Currency Swap and applied in accordance with this order of
priority of payments) and from amounts received from the Series
2 Class M Euro Currency Swap Provider to repay the Series 2
Class M Notes until the Series 2 Class M Notes have been repaid
in full; and
(D) last, in no order of priority between them, but in proportion to
the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class C Dollar Currency Swap
Provider under the Series 1 Class C Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 1
Class C Dollar Currency Swap Provider to repay the Series
1 Class C Notes until the Series 1 Class C Notes have
been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C1 Euro Currency Swap
Provider under the Series 2 Class C1 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class C1 Euro Currency Swap Provider to repay the Series
2 Class C1 Notes until the Series 2 Class C1 Notes have
been repaid in full;
(3) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C2 Euro Currency Swap
Provider under the Series 2 Class C2 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may
be satisfied by any Swap Replacement Payment made to the
Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2
Class C2 Euro Currency Swap Provider to repay the
43
Series 2 Class C2 Notes until the Series 2 Class C2 Notes
have been repaid in full; and
(4) to repay the Series 3 Class C Notes until the Series 3
Class C Notes have been repaid in full.
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager
on that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Principal Amounts
replace.
5. Use of Ledgers
The Current Issuer Cash Manager shall forthwith record monies received
or payments made by it on behalf of the Current Issuer in the ledgers
in the manner set out in this Agreement. If, at any time, the Current
Issuer Cash Manager is in any doubt as to which ledger a particular
amount should be credited or debited, it shall consult with the Note
Trustee thereon.
Except in the case of the Current Issuer Principal Deficiency Ledger
and except as provided in Clause 2.4(b) of the Current Issuer Bank
Account Agreement, a debit item shall only be made in respect of any of
the Current Issuer Ledgers, and the corresponding payment or transfer
(if any) may only be made from the Current Issuer Transaction Accounts,
to the extent that such entry does not cause the relevant ledger to
have a debit balance. In the case of the Current Issuer Principal
Deficiency Ledger and each Current Issuer Principal Deficiency Sub
Ledger, a credit item shall only be made to the extent that such entry
does not cause such ledger to have a credit balance.
6. Current Issuer Revenue Ledger
The Current Issuer Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Current Issuer
Revenue Ledger:
(i) all interest fees and any other amount (not including
principal), if any, paid by Funding to the Current Issuer
under the terms of the Current Issuer Intercompany Loan;
(ii) all interest received by the Current Issuer in respect of
the Current Issuer Bank Accounts;
(iii) all amounts received by the Current Issuer representing
income on any Current Issuer Authorised Investments;
(iv) all amounts (including any early termination payment
which is to be used to acquire, if necessary, a new basis
rate swap) received by the Current Issuer under the Basis
Rate Swap Agreement;
(v) all revenue amounts (including any early termination
payment which is to be used to acquire, if necessary, a
new currency swap) received by the Current Issuer under
the Currency Swap Agreements;
44
(vi) all revenue amounts (including any early termination
payment which is to be used to acquire, if necessary, a
new interest rate swap) received by the Current Issuer
under the Current Issuer Series 3 Class A Interest Rate
Swap Agreement; and
(vii) any amount debited to the Current Issuer Principal Ledger
under paragraph 8; and
(b) any payment or provision made under paragraphs 1 and 3 of this
Schedule 2 shall be debited to the Current Issuer Revenue
Ledger.
7. Current Issuer Principal Ledger
Without prejudice to paragraph 8 below, the Current Issuer Cash Manager
shall ensure that:
(a) the following amounts shall be credited to the Current Issuer
Principal Ledger:
(i) all principal paid by Funding to the Current Issuer under
the terms of the Current Issuer Intercompany Loan;
(ii) amounts credited to the Current Issuer Principal
Deficiency Ledger under paragraphs 3 and 8; and
(b) any payment or provision made under paragraph 4 of this Schedule
2 shall be debited to the Current Issuer Principal Ledger.
8. Current Issuer Principal Deficiency Ledger
(a) Without prejudice to paragraph 7, the Current Issuer Cash
Manager shall ensure that there shall be debited to the Current
Issuer Principal Deficiency Ledger:
(i) principal deficiencies arising from Losses on the
Mortgage Loans which have been allocated by Funding to
the Current Issuer Intercompany Loan;
(ii) the use of Current Issuer Available Principal Receipts to
meet any deficiency in Current Issuer Available Revenue
Receipts; and
(iii) the use of Funding Available Principal Receipts to fund
the Current Issuer Liquidity Reserve Fund, if any.
(b) The Current Issuer Cash Manager shall ensure that there shall be
credited to the Current Issuer Principal Deficiency Ledger any
amount to be credited in accordance with paragraph 3 above.
(c) Amounts to be debited to the Current Issuer Principal Deficiency
Ledger shall be debited in the following order:
45
(i) first, on the Class C Principal Deficiency Sub Ledger,
until the balance of the Class C Principal Deficiency Sub
Ledger is equal to the aggregate Outstanding Principal
Balance of the Class C Notes;
(ii) Second, on the Class B Principal Deficiency Sub Ledger,
until the balance of the Class B Principal Deficiency Sub
Ledger is equal to the aggregate Outstanding Principal
Balance of the Class B Notes; and
(iii) last, on the Class A Principal Deficiency Sub Ledger, at
which point an Asset Trigger Event will have occurred.
9. Records
The Current Issuer Cash Manager shall ensure that a separate record is
kept of any amount received from each of the Current Issuer Swap
Providers pursuant to each of the Current Issuer Swap Agreements.
The Current Issuer Cash Manager hereby agrees that, each time the
Current Issuer Cash Manager records a debit on a Current Issuer
Principal Deficiency Sub Ledger, the Current Issuer Cash Manager shall
also record on such Current Issuer Principal Deficiency Sub Ledger
whether such debit was caused by (A) Losses on the Mortgage Loans which
have been allocated by Funding to the Current Issuer Intercompany Loan,
(B) the application of Current Issuer Available Principal Receipts to
meet any deficiency in Current Issuer Available Revenue Receipts, or
(C) the application of Funding Available Principal Receipts to fund the
Current Issuer Liquidity Reserve Fund, if any.
10. Swap Collateral Ledger
In connection with Swap Collateral the Current Issuer Cash Manager
shall ensure that the appropriate debits and credits are made to the
Swap Collateral Ledger in accordance with Clause 5.6 (Swap Collateral).
46
SCHEDULE 3
Form of Issuer Quarterly Report
Granite Mortgages 03-2 plc
Profit & Loss Account
Period Ended
This Quarter Prior Quarter
(GBP)000's (GBP)000's
Interest Receivable - Intercompany Loan
Interest Receivable - Cash Deposits/Authorised
Investments
---------------------------
0 0
Interest Payable - Notes
Interest Payable
---------------------------
0 0
---------------------------
Net Operating Income 0 0
Other Income
Operating Expenses
---------------------------
Profit/loss on ordinary activities before tax 0 0
Taxation
---------------------------
Profit/loss on ordinary activities after tax 0 0
Dividend 0 0
Retained profit brought forward 0 0
47
---------------------------
Retained profit for the year 0 0
===========================
48
Granite Mortgages 03-2 plc
Balance Sheet
Period Ended
(GBP)000's (GBP)000's
Fixed Asset Investments
Intercompany Lending 0
Current Assets
Interest Receivable 0
Other debtors 0
Cash at Bank 0
Current Issuer Transaction Account:
-------------
0
-------------
Creditors: Amounts falling due within one year
Accruals 0
Interest Payable Accrual 0
Taxation 0
-------------
0
-------------
Net current assets 0
Creditors: Amounts falling due after one year
Amount due to Noteholders 0
-------------
Total Assets less current liabilities 0
=============
Share Capital 0
Reserves 0
-------------
0
=============
0
49
Current Issuer Notes to Balance Sheet:
Principal Deficiency Ledger
Class A Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
Class B Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
Class C Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
50
Granite Mortgages 03-2 plc
Notes Outstanding
Period Ended
Series 1 Class A1 Series 1 Class A2 Series 1 Class A3 Series 2 Class A Series 3 Class A
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
Series 1 Class B Series 2 Class B Series 2 Class M
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
Series 1 Class C Series 2 Class C1 Series 2 Class C2 Series 3 Class C
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
Series 1 Class A1 Series 1 Class A2 Series 1 Class A3 Series 2 Class A Series 3 Class A
Initial Note Balance
Previous Quarters Note Principal
Note Redemptions
Outstanding Note Principal
Series 1 Class B Series 2 Class B Series 2 Class M
Initial Note Balance
Previous Quarters Note Principal
Note Redemptions
Outstanding Note Principal
Series 1 Class C Series 2 Class C1 Series 2 Class C2 Series 3 Class C
Initial Note Balance
Previous Quarters Note Principal
Note Redemptions
Outstanding Note Principal
Series 1 Class A Series 2 Class A Series 3 Class A
Note Interest Margins
Step Up Dates
Step Up Margins
Series 1 Class B Series 2 Class B Series 2 Class M
Note Interest Margins
Step Up Dates
Step Up Margins
Series 1 Class C Series 2 Class C1 Series 2 Class C2 Series 3 Class C
Note Interest Margins
Step Up Dates
Step Up Margins
Payment Cycle
Payment Date
Next Payment Date
Amount Credited to Principal
Deficiency Sub Ledger:
Current Quarter:
Aggregate:
51
SCHEDULE 4
Controlled Amortisation Amount/Target Balance
The "Controlled Amortisation Amount" for each Class of Current Issuer Notes
for any Payment Date set forth below is an amount equal to the amount which
the Current Issuer would be required to repay in respect of such Class of
Current Issuer Notes so that on the relevant Payment Date the aggregate
Principal Amount Outstanding of such Class of Current Issuer Notes has been
reduced to (but is not less than) the "Target Balance" set out in the
following table:
52
---------------------------------------------------------------------------------------------------
Payment
date (GBP)($*) target (GBP)($*) target (GBP)($*) target
occurring balance for series 1 balance for series 1 balance for series 1
in: class A1 notes class A2 notes class A3 notes
------------- ---------------------------- --------------------------- ----------------------------
(GBP) $ $ (GBP) $
------------- -------------- ------------ ------------- ------------- -------------
Jul 2003 692,398,519 1,113,169,099 625,738,633 1,006,000,000 311,003,297 500,000,000
Oct 2003 570,799,344 917,674,106 625,738,633 1,006,000,000 311,003,297 500,000,000
Jan 2004 455,330,101 732,034,203 625,738,633 1,006,000,000 311,003,297 500,000,000
Apr 2004 346,873,602 557,668,690 625,738,633 1,006,000,000 311,003,297 500,000,000
Jul 2004 243,825,072 391,997,567 625,738,633 1,006,000,000 311,003,297 500,000,000
Oct 2004 144,838,915 232,857,523 625,738,633 1,006,000,000 311,003,297 500,000,000
Jan 2005 50,842,745 81,739,881 625,738,633 1,006,000,000 311,003,297 500,000,000
Apr 2005 0 0 589,264,030 947,359,782 311,003,297 500,000,000
Jul 2005 0 0 505,330,396 812,419,678 311,003,297 500,000,000
Oct 2005 0 0 424,705,590 682,799,177 311,003,297 500,000,000
Jan 2006 0 0 348,145,157 559,712,969 311,003,297 500,000,000
Apr 2006 0 0 277,024,664 445,372,553 311,003,297 500,000,000
Jul 2006 0 0 208,660,226 335,463,046 311,003,297 500,000,000
Oct 2006 0 0 142,990,847 229,886,385 311,003,297 500,000,000
Jan 2007 0 0 80,631,925 129,631,946 311,003,297 500,000,000
Apr 2007 0 0 22,703,866 36,501,005 311,003,297 500,000,000
Jul 2007 0 0 0 0 296,974,278 477,445,547
Oct 2007 0 0 0 0 274,221,101 440,865,264
Jan 2008 0 0 0 0 252,614,933 406,129,028
Apr 2008 0 0 0 0 232,320,963 373,502,413
Jul 2008 0 0 0 0 213,038,912 342,502,659
Oct 2008 0 0 0 0 192,745,977 309,877,708
Jan 2009 0 0 0 0 172,661,376 277,587,693
Apr 2009 0 0 0 0 153,765,259 247,208,406
Jul 2009 0 0 0 0 135,775,687 218,286,573
Oct 2009 0 0 0 0 118,509,183 190,527,214
Jan 2010 0 0 0 0 102,064,560 164,089,193
Apr 2010 0 0 0 0 86,759,996 139,484,046
Jul 2010 0 0 0 0 72,059,581 115,850,189
---------------------------------------------------------------------------------------------------
----------------------------------------------------------------------
Payment
date (GBP)/($*) target (GBP)/($*) target
occurring balance for series 1 balance for series 1
in: class B notes class C notes
------------- --------------------------- ----------------------------
(GBP) $ (GBP) $
------------- ------------ -------------- ------------
Jul 2003 47,583,504 76,500,000 6,531,069 10,500,000
Oct 2003 47,583,504 76,500,000 6,531,069 10,500,000
Jan 2004 47,583,504 76,500,000 6,531,069 10,500,000
Apr 2004 47,583,504 76,500,000 6,531,069 10,500,000
Jul 2004 47,583,504 76,500,000 6,531,069 10,500,000
Oct 2004 47,583,504 76,500,000 6,531,069 10,500,000
Jan 2005 47,583,504 76,500,000 6,531,069 10,500,000
Apr 2005 47,583,504 76,500,000 6,531,069 10,500,000
Jul 2005 47,583,504 76,500,000 6,531,069 10,500,000
Oct 2005 47,583,504 76,500,000 6,531,069 10,500,000
Jan 2006 47,583,504 76,500,000 6,531,069 10,500,000
Apr 2006 47,583,504 76,500,000 6,531,069 10,500,000
Jul 2006 47,583,504 76,500,000 6,531,069 10,500,000
Oct 2006 47,583,504 76,500,000 6,531,069 10,500,000
Jan 2007 47,583,504 76,500,000 6,531,069 10,500,000
Apr 2007 47,583,504 76,500,000 6,531,069 10,500,000
Jul 2007 45,437,065 73,049,169 6,236,460 10,500,000
Oct 2007 41,955,828 67,452,385 5,758,643 9,258,171
Jan 2008 38,650,085 62,137,741 5,304,914 8,528,710
Apr 2008 35,545,107 57,145,869 4,878,740 7,843,551
Jul 2008 32,594,954 52,402,907 4,473,817 7,192,556
Oct 2008 30,454,161 48,961,154 4,179,983 6,720,158
Jan 2009 28,740,089 46,205,441 3,944,718 6,341,923
Apr 2009 27,241,185 43,795,654 3,738,986 6,011,168
Jul 2009 25,732,163 41,369,599 3,531,866 5,678,180
Oct 2009 24,277,197 39,030,450 3,332,164 5,357,121
Jan 2010 22,914,573 36,839,758 3,145,137 5,056,437
Apr 2010 21,659,882 34,822,592 2,972,925 4,779,572
Jul 2010 20,449,482 32,876,632 2,806,792 4,512,479
----------------------------------------------------------------------
53
---------------------------------------------------------------------------------------------
Payment
date (GBP)($*) target (GBP)($*) target (GBP)($*) target
occurring balance for series 2 balance for series 2 balance for series 2
in: class A notes class B notes class M notes
----------- ---------------------------- --------------------------- ------------------------
(GBP) (Euro) (GBP) (Euro) (GBP) (Euro)
------------- -------------- ------------ ------------- ------------- ----------
Jul 2003 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Oct 2003 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jan 2004 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Apr 2004 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jul 2004 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Oct 2004 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jan 2005 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Apr 2005 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jul 2005 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Oct 2005 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jan 2006 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Apr 2006 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jul 2006 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Oct 2006 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jan 2007 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Apr 2007 214,377,590 300,000,000 52,093,754 72,900,000 37,373,160 52,300,000
Jul 2007 204,707,252 286,467,328 49,743,862 69,611,561 35,687,298 49,940,804
Oct 2007 189,023,266 264,519,158 45,932,654 64,278,155 32,953,056 46,114,507
Jan 2008 174,129,925 243,677,417 42,313,572 59,213,612 30,356,650 42,481,096
Apr 2008 160,141,094 224,101,448 38,914,286 54,456,652 27,917,931 39,068,352
Jul 2008 146,849,790 205,501,596 35,684,499 49,936,888 25,600,813 35,825,778
Oct 2008 132,861,673 185,926,625 33,340,789 46,657,100 23,919,386 33,472,789
Jan 2009 119,017,162 166,552,616 31,464,247 44,031,067 22,573,115 31,588,818
Apr 2009 105,991,885 148,325,044 29,823,268 41,734,682 21,395,843 29,941,342
Jul 2009 93,591,499 130,971,944 28,171,212 39,422,794 20,210,623 28,282,746
Oct 2009 81,689,530 114,316,329 26,578,336 37,193,723 19,067,859 26,683,562
Jan 2010 70,354,092 98,453,516 25,086,553 35,106,123 17,997,623 25,185,874
Apr 2010 59,804,507 83,690,428 23,712,936 33,183,882 17,012,161 23,806,818
Jul 2010 49,671,369 69,510,113 22,387,807 31,329,497 16,061,485 22,476,443
---------------------------------------------------------------------------------------------
------------------------------------------------------------------------
Payment
date (GBP)/($*) target (GBP)/($*) target
occurring balance for series 2 balance for series 2
in: class C1 notes class C2 notes
----------- ---------------------------- ---------------------------
(GBP) (Euro) (GBP) (Euro)
------------- -------------- ------------ -------------
Jul 2003 11,433,471 16,000,000 46,805,774 65,500,000
Oct 2003 11,433,471 16,000,000 46,805,774 65,500,000
Jan 2004 11,433,471 16,000,000 46,805,774 65,500,000
Apr 2004 11,433,471 16,000,000 46,805,774 65,500,000
Jul 2004 11,433,471 16,000,000 46,805,774 65,500,000
Oct 2004 11,433,471 16,000,000 46,805,774 65,500,000
Jan 2005 11,433,471 16,000,000 46,805,774 65,500,000
Apr 2005 11,433,471 16,000,000 46,805,774 65,500,000
Jul 2005 11,433,471 16,000,000 46,805,774 65,500,000
Oct 2005 11,433,471 16,000,000 46,805,774 65,500,000
Jan 2006 11,433,471 16,000,000 46,805,774 65,500,000
Apr 2006 11,433,471 16,000,000 46,805,774 65,500,000
Jul 2006 11,433,471 16,000,000 46,805,774 65,500,000
Oct 2006 11,433,471 16,000,000 46,805,774 65,500,000
Jan 2007 11,433,471 16,000,000 46,805,774 65,500,000
Apr 2007 11,433,471 16,000,000 46,805,774 65,500,000
Jul 2007 11,433,471 16,000,000 44,694,417 62,545,367
Oct 2007 11,433,471 16,000,000 41,270,080 57,753,350
Jan 2008 11,433,471 16,000,000 38,018,367 53,202,903
Apr 2008 11,433,471 16,000,000 34,964,139 48,928,816
Jul 2008 11,433,471 16,000,000 32,062,204 44,867,848
Oct 2008 11,433,471 16,000,000 29,956,402 41,920,988
Jan 2009 11,433,471 16,000,000 28,270,345 39,561,521
Apr 2009 11,433,471 16,000,000 26,795,941 37,498,239
Jul 2009 11,433,471 16,000,000 25,311,583 35,421,029
Oct 2009 11,433,471 16,000,000 23,880,398 33,418,228
Jan 2010 11,433,471 16,000,000 22,540,044 31,542,538
Apr 2010 11,433,471 16,000,000 21,305,861 29,815,422
Jul 2010 11,433,471 16,000,000 20,115,245 28,149,273
------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
Payment date occurring in: (GBP) target balance for series 3 (GBP) target balance for series 3
class A notes class C notes
------------------------------ --------------------------------- ---------------------------------
(GBP) (GBP)
--------------------------------- ---------------------------------
Jul 2003 352,280,000 15,000,000
Oct 2003 352,280,000 15,000,000
Jan 2004 352,280,000 15,000,000
Apr 2004 352,280,000 15,000,000
Jul 2004 352,280,000 15,000,000
Oct 2004 352,280,000 15,000,000
Jan 2005 352,280,000 15,000,000
Apr 2005 352,280,000 15,000,000
Jul 2005 352,280,000 15,000,000
Oct 2005 352,280,000 15,000,000
Jan 2006 352,280,000 15,000,000
Apr 2006 352,280,000 15,000,000
Jul 2006 352,280,000 15,000,000
Oct 2006 352,280,000 15,000,000
Jan 2007 352,280,000 15,000,000
Apr 2007 352,280,000 15,000,000
Jul 2007 352,280,000 14,323,366
Oct 2007 352,280,000 13,225,958
Jan 2008 352,280,000 12,183,871
Apr 2008 352,280,000 11,205,072
Jul 2008 352,280,000 10,275,080
Oct 2008 352,280,000 9,600,226
Jan 2009 352,280,000 9,059,890
Apr 2009 352,280,000 8,587,383
Jul 2009 352,280,000 8,111,686
Oct 2009 352,280,000 7,653,029
Jan 2010 352,280,000 7,223,482
Apr 2010 352,280,000 6,827,959
Jul 2010 352,280,000 6,446,398
----------------------------------------------------------------------------------------------------------
54
PROVIDED THAT on the Payment Date immediately following the Step-up Date in
respect of the Current Issuer and on each Payment Date thereafter:
(1) the Target Balance for the Series 1 Class A1 Notes and the Series 1
Class A2 Notes will be zero; and
(2) the Target Balances for each other Class of Current Issuer Notes will
be an amount equal to the greater of:
(a) zero, and
(b) the aggregate Principal Amount Outstanding on such Class of
Notes as at the immediately preceding Payment Date (after taking
into account principal payments on such Payment Date) less an
amount equal the product of:
(i) the product of (A) the sum of the Mortgages Trustee
Principal Receipts for each Distribution Date since the
immediately preceding Payment Date, and (B) the Funding
Share Percentage applicable as at the later to occur of
the immediately preceding Assignment Date, the
immediately preceding Funding Contribution Date and the
immediately preceding Distribution Date; and
(ii) the quotient of (A) the Outstanding Principal Balance on
such Current Issuer's Intercompany Loan as at the
immediately preceding Payment Date (after taking into
account principal payments on such Payment Date) less the
aggregate Outstanding Principal Balances of the Special
Repayment Notes of the Third Issuer divided by (B) the
aggregate Outstanding Principal Balance on all
Intercompany Loans as at the immediately preceding
Payment Date (after taking into account principal
payments on such Payment Date) less the sum of (1) the
aggregate amount of all Special Repayment Notes and (2)
the aggregate of amounts recorded on the Principal
Deficiency Ledgers of all Issuers; and
(iii) the quotient of (A) the aggregate Principal Amount
Outstanding on such Class of Notes as at the immediately
preceding Payment Date (after taking into account
principal payments on such Payment Date), divided by (B)
the aggregate Principal Amount Outstanding on all Classes
of Notes of the Current Issuer as at the immediately
preceding Payment Date (after taking into account
principal payments on such Payment Date).
To the extent not repaid earlier, the full Principal Amount Outstanding
on a Class of Current Issuer Notes will become due and payable on the
final maturity date of that Class of Notes.
55
SCHEDULE 5
Current Issuer Cash Manager Representations and Warranties
The Current Issuer Cash Manager makes the following representations and
warranties to each of the Mortgages Trustee, Funding and the Note 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, a 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) conflict with any document which is binding upon it or any of
its assets;
(b) conflict with its constitutional documents; or
(c) 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 Licenses: All governmental consents, licences and other
approvals and authorisations required 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 Current
Issuer Cash Manager, and the Current Issuer Cash Manager is not
insolvent.
8. Financial Statements: The most recent financial statements of the
Current Issuer Cash Manager:
56
(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 Current Issuer Cash
Manager; and
(c) save as disclosed therein, give a true and fair view of the
financial condition and operations of the Current Issuer Cash
Manager during the relevant financial year.
9. No Adverse Change: Since the date as of which the most recent financial
statements of the Current Issuer Cash Manager were stated to be
prepared, there has been:
(a) no significant change in the financial position of the Current
Issuer Cash Manager; and
(b) no material adverse change in the financial position or
prospects of the Current Issuer Cash Manager.
10. Ranking of Claims
Under the laws of England and Wales in force as at the date of making
this representation, claims against the Current Issuer Cash Manager
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:
All information in the Prospectus and the Offering Circular with regard
to the Current Issuer Cash Manager are true and accurate in all
material respects and not misleading in any material respect.
The Current Issuer Cash Manager has made all proper inquiries to ascertain and
to verify the foregoing.
57
EXECUTION PAGE
The Current Issuer Cash Manager
Executed by
NORTHERN ROCK PLC
as follows:
Signed for and on its behalf by one of its duly authorised By________________________________________________
attorneys/signatories Duly Authorised Attorney/Signatory
Name________________________________________________
The Current Issuer
Executed by
GRANITE MORTGAGES 03-2 PLC
as follows: By________________________________________________
Signed for and on its behalf by one of its duly authorised Duly Authorised Attorney/Signatory
attorneys/signatories
Name________________________________________________
The Note Trustee
Executed by
THE BANK OF NEW YORK
as follows: By________________________________________________
Signed for and on its behalf by one of its duly authorised Duly Authorised Attorney/Signatory
attorneys/signatories
Name________________________________________________
58
