EXHIBIT 4.3
Dated [o] 2005
NORTHERN ROCK PLC
as Seller
GRANITE FINANCE TRUSTEES LIMITED
as Mortgages Trustee
GRANITE FINANCE FUNDING LIMITED
as Beneficiary
- and -
THE BANK OF NEW YORK
as Security Trustee
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TENTH AMENDED
MORTGAGE SALE AGREEMENT
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SIDLEY XXXXXX XXXXX & XXXX
WOOLGATE EXCHANGE
00 XXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
CONTENTS
Clause Page No.
1. Definitions and Construction........................................................................1
2. Sale and Purchase of Initial Mortgage Portfolio.....................................................1
3. Initial Closing Date................................................................................2
4. Sale and Purchase of New Mortgage Portfolios........................................................4
5. Trust of Monies....................................................................................11
6. Perfection of the Assignment.......................................................................13
7. Undertakings.......................................................................................16
8. Warranties and Repurchase by the Seller............................................................20
9. Further Assurance..................................................................................26
10. Consequences of Breach.............................................................................26
11. Subordination......................................................................................26
12. Non-Merger.........................................................................................27
13. No Agency or Partnership...........................................................................27
14. Payments...........................................................................................27
15. Assignment.........................................................................................27
16. Funding Security Trustees..........................................................................28
17. New Intercompany Loans.............................................................................29
18. Non Petition Covenant; Limited Recourse............................................................29
19. Amendments and Waiver..............................................................................30
20. Notices............................................................................................31
21. Third Party Rights.................................................................................32
22. Execution in Counterparts; Severability............................................................32
23. Governing Law and Submission to Jurisdiction.......................................................32
24. Process Agent......................................................................................32
25. Appropriate Forum..................................................................................32
26. Transaction Documents..............................................................................33
SCHEDULE 1 REPRESENTATIONS AND WARRANTIES.................................................................35
SCHEDULE 2 FORMS OF TRANSFERS: REGISTERED AND UNREGISTERED LAND AND SCOTTISH TRANSFERS....................44
Part 1 FORM OF TRANSFER (REGISTERED LAND - ENGLAND AND WALES)............................................45
Part 2 FORM OF TRANSFER (UNREGISTERED LAND - ENGLAND AND WALES)..........................................46
Part 3 FORM OF TRANSFER (LAND REGISTER - SCOTLAND).......................................................48
Part 4 FORM OF TRANSFER (SASINE REGISTER - SCOTLAND).....................................................50
SCHEDULE 3 ASSIGNMENT OF INSURANCE CONTRACTS..............................................................52
SCHEDULE 4 INSURANCE CONTRACTS............................................................................54
SCHEDULE 5................................................................................................55
Part 1 ASSIGNMENT OF GUARANTEES..........................................................................55
Part 2 ASSIGNATION OF GUARANTEES.........................................................................57
SCHEDULE 6 NEW MORTGAGE PORTFOLIO NOTICE..................................................................60
SCHEDULE 7 LOAN REPURCHASE NOTICE........................................................................63
SCHEDULE 8 FORM OF NOTIFICATION TO BORROWERS..............................................................65
SCHEDULE 9 OFFER UNDER CLAUSE 8.6 (REPURCHASE OF FIXED RATE MORTGAGE LOANS)...............................66
SCHEDULE 10...............................................................................................67
Part 1 POWER OF ATTORNEY IN FAVOUR OF THE MORTGAGES TRUSTEE, FUNDING AND THE SECURITY TRUSTEE............67
Part 2 POWER OF ATTORNEY IN FAVOUR OF THE MORTGAGES TRUSTEE, EACH FUNDING BENEFICIARY AND EACH
FUNDING SECURITY TRUSTEE..........................................................................71
SCHEDULE 11 FORM OF SCOTTISH TRUST DEED...................................................................74
SCHEDULE 12 LENDING CRITERIA .............................................................................81
SCHEDULE 13 STANDARD DOCUMENTATION........................................................................84
APPENDIX A THE INITIAL MORTGAGE LOAN PORTFOLIO............................................................85
THIS TENTH AMENDED MORTGAGE SALE AGREEMENT DATED [o], 2005 FURTHER AMENDS AND
RESTATES THE MORTGAGE SALE AGREEMENT DATED 26 MARCH 2001 BETWEEN:
(1) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales, whose registered office
is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as Seller and in its capacity as a Beneficiary;
(2) GRANITE FINANCE TRUSTEES LIMITED (registered number 79309), a private
limited company incorporated under the laws of Jersey, whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel
Islands in its capacity as the Mortgages Trustee;
(3) GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
limited company incorporated under the laws of Jersey, but acting out of
its branch office established in England (registered overseas company
number FC022999 and branch number BR005916) at 00 Xxxx Xxxx, Xxxxxxx XX0
0XX in its capacity as a Beneficiary; and
(4) THE BANK OF NEW YORK a New York banking corporation whose London branch
address is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its
capacity as Security Trustee.
WHEREAS:
(A) The Seller carries on the business (inter alia) of originating mortgage
loans secured on residential properties located in England, Wales and
Scotland.
(B) The Seller has agreed to sell and assign to the Mortgages Trustee certain
mortgage loans, together with the benefit of the related security for the
same, on the terms and subject to, the conditions set out in this
Mortgage Sale Agreement (the "Agreement").
(C) The Mortgages Trustee has agreed to hold certain of the above mentioned
mortgage loans as bare trustee for the Beneficiaries upon, with and
subject to the trusts, powers and provisions of the Mortgages Trust Deed.
IT IS HEREBY AGREED AS FOLLOWS:
1. Definitions and Construction
1.1. The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx &
Overy LLP on [o] 2005 (as the same have been and may be amended, varied
or supplemented from time to time with the consent of the parties hereto)
are expressly and specifically incorporated into and shall apply to this
Agreement.
2. Sale and Purchase of Initial Mortgage Portfolio
2.1. Agreement to Assign: Subject to Clause 2.2 (Conditions), in consideration
of the Purchase Price for the Initial Mortgage Portfolio (which shall be
paid in accordance with Clause 3.3 (Effect of Payment of Initial Purchase
Price)) and the covenant of the
Mortgages Trustee to hold the Trust Property upon trust for the Seller
and Funding as beneficiaries of the Mortgages Trust upon, with and
subject to all the trusts, powers and provisions of the Mortgages Trust
Deed and the Mortgages Trustee's agreement in Clause 3.5 (Early Repayment
Charges) to pay to the Seller any and all Early Repayment Charge
Receipts, the Seller hereby agrees to sell and assign the Initial
Mortgage Portfolio to the Mortgages Trustee on the Initial Closing Date
with full title guarantee.
2.2. Conditions: The obligation of the Seller under Clause 2.1 (Agreement to
Assign) shall be subject to and conditional upon:
(a) the issue by the First Issuer of the Notes on the Initial Closing
Date and the borrowing by Funding of the amount provided for under
the First Issuer Intercompany Loan Agreement;
(b) the constitution of the Mortgages Trust on or prior to the Initial
Closing Date;
(c) the Transaction Documents having been executed and delivered by the
parties thereto on or before the Initial Closing Date or, in the
case of any Transaction Documents which are to be executed
immediately after the Initial Closing Date, the same having been
executed and being available for delivery and none of the parties
knowing of any reason why the same should not be delivered
immediately thereafter;
(d) the payment of the Initial Contribution by Funding to the Mortgages
Trustee in accordance with the terms of the Mortgages Trust Deed;
and
2.3. the payment of the Initial Purchase Price by the Mortgages Trustee to the
Seller in accordance with paragraph (a) of Clause 3.2 (Purchase Price).
3. Initial Closing Date
3.1. Initial Closing and Conditions Precedent: A meeting shall take place on
the Initial Closing Date at the offices of Xxxxx & Xxxx, 0 Xxxxxxx Xxxxx,
Xxxxxx XX0X 0XX, or such offices as the parties may agree, at which the
Seller shall deliver to the Security Trustee (upon request), Funding and
the Mortgages Trustee or the representative of such party (or procure
such delivery to such party of) the following documents:
(a) an original power of attorney in the form set out in Part 1 of
Schedule 10 (Power of Attorney in favour of the Mortgages Trustee,
Funding and the Security Trustee) duly executed by the Seller;
(b) a certificate of solvency in relation to the Seller dated as at the
Initial Closing Date (in the form of the agreed draft) duly executed
by the Seller;
(c) a list of the Mortgage Loans in the Initial Mortgage Portfolio;
(d) an assignment of the Insurance Contracts to the extent that such
Insurance Contracts relate to the Initial Mortgage Portfolio in the
form set out in Schedule 3 (Assignment of Insurance Contracts) duly
executed by the Seller; and
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(e) a certified copy of the board minutes of the securitisation
sub-committee of the Seller authorising its duly appointed
representatives to agree the sale and assignment of the Initial
Mortgage Portfolio and authorising the execution and performance of
this Agreement, the Mortgages Trust Deed, the Administration
Agreement, the other Transaction Documents and all of the
documentation to be entered into pursuant to the Transaction
Documents.
3.2. Purchase Price: Subject to fulfilment of the conditions referred to in
paragraphs (a) to (and including) (d) of Clause 2.2 (Conditions) and
Clause 3.1 (Initial Closing and Conditions Precedent), the Mortgages
Trustee shall pay the Purchase Price for the Initial Mortgage Portfolio
to the Seller, in the manner that the Seller directs, for value, as
follows:
(a) the Initial Purchase Price for the Initial Mortgage Portfolio shall
be paid by the Mortgages Trustee to the Seller on the Initial
Closing Date (which Initial Purchase Price shall be paid by the
Mortgages Trustee from funds received by the Mortgages Trustee from
Funding on such date in respect of Funding's Initial Contribution
for the Funding Share of the Closing Trust Property pursuant to the
Mortgages Trust Deed);
(b) subject to and in accordance with the Mortgages Trustee Revenue
Priority of Payments, an amount of Deferred Purchase Price in
respect of the Mortgage Portfolio shall be paid by the Mortgages
Trustee to the Seller on each Distribution Date but only from and to
the extent (if any) of any Relevant Distribution (as defined under
paragraph (b) of Clause 4.2 (Consideration provided by Funding) of
the Mortgages Trust Deed) available for payment on such date and in
an amount equal to the Deferred Contribution for the Funding Share
of the Trust Property paid by Funding to the Mortgages Trustee on
such date or in respect of which the payment of such Deferred
Contribution is otherwise satisfied on such date in accordance with
the Mortgages Trust Deed; and
(c) a final amount of Deferred Purchase Price in respect of the Mortgage
Portfolio shall be paid by the Mortgages Trustee to the Seller
following the receipt by the Mortgages Trustee from Funding of any
Final Deferred Contribution, which payment shall be in an amount
equal to such Final Deferred Contribution for the Funding Share of
the Trust Property paid by Funding to the Mortgages Trustee or in
respect of which the payment of such Final Deferred Contribution is
otherwise satisfied in accordance with the Mortgages Trust Deed.
3.3. Effect of Payment of Initial Purchase Price: The parties hereto
acknowledge that the effect of the payment to the Seller by the Mortgages
Trustee of the Initial Purchase Price on the Initial Closing Date will be
the assignment to the Mortgages Trustee of the beneficial ownership of,
and all of the Seller's beneficial right, title, interest and benefit in
and to, the Initial Mortgage Portfolio subject to the terms and
provisions of the Mortgages Trust Deed, which assignment will be
perfected upon the occurrence of any of the events set forth in Clause 6
(Perfection of the Assignment) and the transfer to the Mortgages Trustee
of legal title to the Initial Mortgage Portfolio in accordance with
Clause 6 (Perfection of the Assignment).
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3.4. Documents: The Seller undertakes that from the Initial Closing Date until
the perfection of the assignment in accordance with Clause 6.1
(Perfection Events) and delivery of the Title Deeds in accordance with
Clause 6.2 (Perfection), the Seller shall hold the deeds and documents
constituting the Title Deeds and Mortgage Loan Files and all other
certificates, notices, policies, endorsements and other matters necessary
to establish title thereto relating to the Mortgage Portfolio that are in
its possession or under its control or held to its order to the order of
the Mortgages Trustee or as the Mortgages Trustee shall direct.
3.5. Early Repayment Charges: The Mortgages Trustee hereby agrees to pay to
the Seller as part of the Deferred Purchase Price any and all Early
Repayment Charge Receipts received by the Mortgages Trustee in respect of
the Mortgage Loans included in the Initial Mortgage Portfolio PROVIDED
THAT, if any Mortgage Loans in respect of which Early Repayment Charges
are payable are the subject of a trust pursuant to Clause 5.1 (Trust in
favour of Mortgages Trustee), the Seller, the Mortgages Trustee, Funding
and the Security Trustee agree that the benefit of any Early Repayment
Charges payable under such Mortgage Loan shall, on the date of payment to
the Seller of the related Early Repayment Charge Receipts, be released
from such trust.
3.6. Insurance: The Seller shall as soon as reasonably practical after the
sale and assignment of the Initial Mortgage Portfolio on the Initial
Closing Date procure that the respective interests of the Mortgages
Trustee, Funding and the Security Trustee are noted by the relevant
insurers in relation to each Insurance Contract.
4. Sale and Purchase of New Mortgage Portfolios
4.1. Agreement to Assign: Subject to fulfilment of the conditions set out in
Clauses 2.2 (Conditions), 3.1 (Initial Closing and Conditions Precedent),
4.2 (Conditions to Effecting an Assignment of New Mortgage Loans) and 4.3
(No Further Assignment), in consideration of either:
(a) the Purchase Price, if any is payable (which if it is payable shall
be paid in accordance with Clause 4.5 (Purchase Price)), for the New
Mortgage Portfolio and the covenant by the Mortgages Trustee to hold
the Trust Property upon trust for the Seller, Funding and (from and
including the Funding 2 Programme Date) Funding 2 as beneficiaries
of the Mortgages Trust, upon, and with and subject to the trusts,
powers and provisions of the Mortgages Trust Deed; or
(b) the covenant by the Mortgages Trustee to hold the Trust Property
upon trust for the Seller, Funding and (from and including the
Funding 2 Programme Date) Funding 2 as beneficiaries of the
Mortgages Trust upon, and with and subject to the trusts, powers and
provisions of the Mortgages Trust Deed,
and (in either case) the Mortgages Trustee's agreement in Clause 4.8
(Early Repayment Charges) to pay to the Seller any and all Early
Repayment Charge Receipts, if the Seller shall at any time and from time
to time serve a properly completed New Mortgage Portfolio Notice as set
out in Schedule 6 (New Mortgage Portfolio Notice) on the Mortgages
Trustee, Funding and (from and including the Funding 2 Programme Date)
Funding 2 with a copy (upon request) to the Security Trustee and/or (from
and including the Funding 2 Programme Date) the Funding 2
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Security Trustee (such service to be in the Seller's sole discretion),
then on the Assignment Date specified in the New Mortgage Portfolio
Notice the Seller agrees that it shall sell and assign to the Mortgages
Trustee the relevant New Mortgage Portfolio with full title guarantee
(or, in relation to assets and rights situated in or governed by the law
of Scotland, with absolute warrandice), PROVIDED THAT (a) the Seller
hereby covenants and undertakes that it will not sell and assign New
Mortgage Loans to the Mortgages Trustee during any Trust Calculation
Period prior to the Distribution Date in such Trust Calculation Period,
and (b) the Seller hereby agrees that it is only permitted to make one
sale and assignment of New Mortgage Loans to the Mortgages Trustee during
any Trust Calculation Period.
4.2. Conditions to Effecting an Assignment of New Mortgage Loans: The
conditions to be met as at each Assignment Date in order to effect a sale
and assignment of New Mortgage Loans are:
(a) the aggregate Arrears of Interest in respect of all of the Mortgage
Loans in the Mortgages Trust, as a percentage of the aggregate gross
interest due during the previous 12 months on all Mortgage Loans
outstanding during all or part of such period, does not exceed 2 per
cent., or such other percentage as agreed to by the Rating Agencies
on such Assignment Date. "Arrears of Interest" for this purpose in
respect of a Mortgage Loan on any date means the aggregate amount
overdue on the Mortgage Loan on that date, but only where such
aggregate amount overdue equals or exceeds an amount equal to the
Monthly Payment then due on the Mortgage Loan and such amount has
been overdue for an entire calendar month;
(b) the long term, unsecured, unguaranteed and unsubordinated debt
obligations of the Seller are rated no lower than A3 by Xxxxx'x and
A- by Fitch at the time of, and immediately following, the
assignment of the New Mortgage Loans to the Mortgages Trustee;
(c) on the relevant Assignment Date, the aggregate Current Balance of
the Mortgage Loans in the Mortgages Trust, in respect of which the
aggregate amount is then in arrears for at least 3 months, is less
than 4 per cent. of the aggregate Current Balance of all Mortgage
Loans in the Mortgages Trust on such Assignment Date, unless the
Rating Agencies have confirmed that the then current ratings of the
Notes will not be adversely affected;
(d) the Lending Criteria applicable at the time of origination of each
relevant New Mortgage Loan have been applied to the New Mortgage
Loan and to the circumstances of the Borrower at the time the New
Mortgage Loan was made, provided that material variations from such
Lending Criteria may occur so long as the Rating Agencies have been
notified of any such material variations;
(e) no New Mortgage Loan has on the relevant Assignment Date an
aggregate amount in arrears which is greater than the amount of the
Monthly Payment then due;
(f) the Rating Agencies have not provided written confirmation to the
Mortgages Trustee, each Funding Security Trustee and any Issuer that
the assignment to
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the Mortgages Trustee of the New Mortgage Loans on the Assignment
Date will adversely affect the then current ratings of the existing
Notes of such Issuer (provided that, in respect of the assignment by
the Seller to the Mortgages Trustee of a New Mortgage Portfolio in
connection with the issuance by an Issuer of Notes and the drawing
by a Funding Beneficiary of a loan pursuant to an Intercompany Loan
Agreement, the condition to be met at the relevant Assignment Date
of such New Mortgage Portfolio will be that the Rating Agencies have
confirmed in writing to the Mortgages Trustee, each Funding Security
Trustee and such Issuer that the assignment to the Mortgages Trustee
of the New Mortgage Portfolio on such Assignment Date will not
adversely affect the then current ratings of the existing Notes of
any Issuer);
(g) the aggregate Current Balance of New Mortgage Loans transferred in
any one Interest Period does not exceed 10 per cent. of the
aggregate Current Balance of Mortgage Loans in the Mortgages Trust
as at the beginning of that Interest Period;
(h) each Issuer Reserve Fund is fully funded on the relevant Assignment
Date up to the relevant required amount or, if any Issuer Reserve
Fund is not so fully funded, no payments have been made from such
Issuer Reserve Fund;
(i) the [Funding 2 Reserve Fund] is fully funded on the relevant
Assignment Date up to the relevant required amount or, if the
[Funding 2 Reserve Fund] is not so fully funded, no payments have
been made from it;
(j) no Intercompany Loan Enforcement Notice has been served in respect
of any Intercompany Loan;
(k) the assignment of the New Mortgage Portfolio on the relevant
Assignment Date does not result in the product of WAFF and WALS for
the Mortgage Portfolio after such purchase, calculated on the
relevant Assignment Date in the same way as for the Initial Mortgage
Portfolio (or as agreed by the Administrator and the Rating Agencies
from time to time), exceeding the product of WAFF and WALS for the
Mortgage Portfolio calculated on the most recent preceding Closing
Date plus [0.25] per cent.;
(l) to the extent necessary, each Funding Beneficiary and/or each Issuer
has entered into appropriate hedging arrangements in respect of such
New Mortgage Loans before such Mortgage Loans are assigned to the
Mortgage Trust;
(m) no event of default under the Transaction Documents has occurred
which is continuing as at the relevant Assignment Date;
(n) the weighted average yield on the Mortgage Portfolio together with
the New Mortgage Portfolio to be assigned to the Mortgages Trustee
on the relevant Assignment Date is not less than LIBOR for
three-month sterling deposits plus [0.50] per cent., taking into
account the weighted average yield on the Mortgage Loans and the
margins on any Basis Rate Swaps as at the relevant Assignment Date;
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(o) the assignment of the New Mortgage Portfolio on the relevant
Assignment Date does not result in the weighted average loan to
value ratio of Mortgage Loans in the Mortgage Portfolio on the
relevant Assignment Date (after the purchase of the New Mortgage
Portfolio) after application of the LTV Test on the relevant
Assignment Date exceeding the loan to value ratio (based on the LTV
Test) of Mortgage Loans in the Mortgage Portfolio on the most recent
preceding Closing Date plus 0.25 per cent.;
(p) no New Mortgage Loan has a maturity date on or after January 2039
or, following the redemption in full of all Notes issued by the
Funding Issuers, January 2044;
(q) the related Borrower under each New Mortgage Loan has made at least
one Monthly Payment;
(r) for so long as any Notes issued by any Issuer that have a Final
Repayment Date earlier than January [2041] are outstanding, the
assignment of New Mortgage Loans to the Mortgages Trustee may only
occur if, following such assignment, the aggregate number of
Repayment Mortgage Loans in the Mortgage Portfolio is greater than
or equal to 25 per cent. of the aggregate number of Mortgage Loans
in the Mortgage Portfolio;
(s) the Rating Agencies have provided written confirmation that the then
current ratings on the Notes of any Issuer would not be adversely
affected by the assignment to the Mortgages Trustee of a New
Mortgage Loan in respect of a mortgage loan product having
characteristics and/or features that differ materially from the
characteristics and/or features of the Mortgage Loans in the Initial
Mortgage Portfolio;
(t) following the purchase by the Mortgages Trustee of any New Mortgage
Portfolio, the aggregate Current Balance of Mortgage Loans in the
Mortgages Trust that are subject to a maximum rate of interest and
which charge interest at the lesser of the Seller's Standard
Variable Rate and the maximum rate of interest (as specified in the
relevant Mortgage Conditions) (the "Capped Rate Mortgage Loans")
will not exceed 3 per. cent of the aggregate Current Balance of all
Mortgage Loans in the Mortgages Trust (including such Capped Rate
Mortgage Loans) as of such Assignment Date, unless Xxxxx'x has
confirmed in writing that the then current ratings of the Notes will
not be adversely affected,
PROVIDED THAT, if an Initial Purchase Price is payable to the Seller by
the Mortgages Trustee on the relevant Assignment Date, only the
conditions set out in paragraphs (e), (f), (j), (l), (m), (n), (p), (q),
(r) and (s) are required to be satisfied to effect an assignment of the
New Mortgage Loans.
Notwithstanding the foregoing, the Mortgages Trustee may waive or vary
any of the conditions set forth in Clause 4.2 provided that each of the
Rating Agencies has confirmed in writing (whether or not such
confirmation is addressed to the Mortgages Trustee) that the relevant
waiver or variation will not adversely affect the then current ratings of
the existing Notes of any Issuer or that it approves the relevant waiver
or variation.
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4.3. No Further Assignment: The Seller and the Mortgages Trustee agree that
the Seller may not sell and assign any New Mortgage Portfolio after the
earlier to occur of:
(a) the Step-up Date in respect of the Notes of any Funding Issuer if
the option to redeem any such Notes on the related Step-up Date
pursuant to Condition 5(D) of those Notes is not exercised; or
(b) the Step-up Date in respect of the Notes of any Funding 2 Issuer if
the option to redeem any such Notes on the related Step-up Date
pursuant to Condition 5(D) of those Notes is not exercised and the
aggregate Principal Amount Outstanding of such Notes as at the
Step-Up Date exceeds (GBP)1,000,000,000; or
(c) the date falling 12 months after the Step-Up Date in respect of any
Series and Class of Notes of any Funding 2 Issuer, if the option to
redeem any such Notes on such date pursuant to the terms and
conditions of such Notes is not exercised.
4.4. Closing and Conditions Precedent: A meeting shall take place on the date
of the sale and assignment of the relevant New Mortgage Portfolio at the
offices of the Seller or at such other office as may be agreed by the
parties at which the Seller shall deliver to the Security Trustee and
(from and including the Funding 2 Programme Date) the Funding 2 Security
Trustee or their respective representatives the following documents:
(a) a certificate of solvency in relation to the Seller dated the
relevant Assignment Date (in the form of the agreed draft) duly
executed by the Seller;
(b) an assignment of the Insurance Contracts to the extent that such
Insurance Contracts relate to the New Mortgage Portfolio in the form
set out in Schedule 3 (Assignment of Insurance Contracts) duly
executed by the Seller;
(c) a certificate of a duly authorised officer of the Seller attaching a
copy of the board minutes referred to in paragraph (e) of Clause 3.1
(Initial Closing and Conditions Precedent) and confirming that the
resolutions referred to therein are in full force and effect and
have not been amended or rescinded as at the date of the
certificate; and
(d) a Scottish Trust Deed in respect of the Scottish Mortgage Loans in
the New Mortgage Portfolio (if any) and their Related Security, in
the form set out in Schedule 11 and with the annexure thereto duly
completed, duly executed by the Seller.
4.5. Purchase Price: Subject to fulfilment of the conditions referred to in
Clauses 4.2 (Conditions to Effecting an Assignment of New Mortgage
Loans), 4.3 (No Further Assignment) and 4.4 (Closing and Conditions
Precedent), the Mortgages Trustee shall, if and to the extent that the
same is payable, pay the Purchase Price for the New Mortgage Portfolio to
the Seller, in the manner that the Seller directs, for value, as follows:
(a) if any Initial Purchase Price is payable in respect of the New
Mortgage Portfolio (which shall only be the case if an Initial
Contribution is paid by any
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Funding Beneficiary to the Mortgages Trustee on such date pursuant
to the terms of the Mortgages Trust Deed) such Initial Purchase
Price shall be paid by the Mortgages Trustee to the Seller on the
relevant Assignment Date (which Initial Purchase Price shall be paid
by the Mortgages Trustee either from funds received by the Mortgages
Trustee from Funding on such date in respect of an Initial
Contribution by Funding for the Funding Share of the New Trust
Property or from Funding 2 on such date in respect of an Initial
Contribution by Funding 2 for the Funding 2 Share of the New Trust
Property, in each case pursuant to the Mortgages Trust Deed),
PROVIDED THAT if on any date the Seller is obliged to repurchase any
Mortgage Loan or Mortgage Loans pursuant to Clause 8.4 (Repurchase),
8.5 (Purchase of Product Switches, Further Advances and purchases
relating to Personal Secured Loans) or 8.6 (Repurchase of Fixed Rate
Mortgage Loans), and on such date the Seller sells and assigns New
Mortgage Loans and their Related Security to the Mortgages Trustee,
the Seller is entitled to set-off against the repurchase price
payable by it on such repurchase as set forth under Clause 8.7
(Completion of Repurchase) the amount of any Initial Purchase Price
payable for any such New Mortgage Loans and shall instead pay (or be
paid) such net amount; and
(b) subject to and in accordance with the Mortgages Trustee Revenue
Priority of Payments, an amount of Deferred Purchase Price in
respect of the Mortgage Portfolio shall be paid by the Mortgages
Trustee to the Seller on each Distribution Date but only from and to
the extent (if any) of any Funding Relevant Distribution and/or
Funding 2 Relevant Distribution available for payment on such date
and in an amount equal to the Deferred Contribution paid by the
Funding Beneficiaries to the Mortgages Trustee on such date or in
respect of which the payment of such Deferred Contribution is
otherwise satisfied on such date in accordance with the Mortgages
Trust Deed.
4.6. Effect of Payment of Initial Purchase Price or Fulfilment of Conditions:
The parties hereto acknowledge that the effect of either the payment to
the Seller by the Mortgages Trustee of the Initial Purchase Price on the
relevant Assignment Date or, if no Initial Purchase Price is payable on
such date, the confirmation from the Seller of the fulfilment of the
conditions referred to in Clauses 4.2 (Conditions to Effecting an
Assignment of New Mortgage Loans) and the delivery to each Funding
Security Trustee of the documents referred to in Clause 4.4 (Closing and
Conditions Precedent) on such date, will be the assignment and transfer
to the Mortgages Trustee of the beneficial ownership of, and all of the
Seller's beneficial right, title, interest and benefit in and to, the New
Mortgage Portfolio subject to the terms and provisions of the Mortgages
Trust Deed. Upon payment to the Seller by the Mortgages Trustee of the
Initial Purchase Price on the relevant Assignment Date or, if no Initial
Purchase Price is payable on such date, upon receipt of confirmation from
the Seller of the fulfilment of the conditions referred to in Clauses 4.2
(Conditions to Effecting an Assignment of New Mortgage Loans), the fact
that any of the conditions referred to in Clause 4.2 (Conditions to
Effecting an Assignment of New Mortgage Loans) may not have been
satisfied or waived, or any of the conditions precedent set out in Clause
4.4 (Closing and Conditions Precedent) have not been delivered or waived,
shall not prevent the sale and assignment of the New Mortgage Portfolio
to the Mortgages Trustee on the relevant Assignment Date (or prevent any
Scottish Trust Deed from
9
taking effect) and any unsatisfied conditions precedent shall be deemed
to have been waived. The foregoing is without prejudice to all of the
rights and remedies of the Mortgages Trustee against the Seller,
including without limitation, all claims for breach of Representation and
Warranty. Each such assignment and transfer will be perfected upon the
occurrence of any of the events set forth in Clause 6 (Perfection of the
Assignment) and the transfer and assignation to the Mortgages Trustee of
legal title to such New Mortgage Portfolio in accordance with Clause 6
(Perfection of the Assignment).
4.7. Documents: The Seller undertakes that from the relevant Assignment Date
until the perfection of the assignment in accordance with Clause 6.1
(Perfection Events) and the delivery of the Title Deeds in accordance
with Clause 6.2 (Perfection), the Seller shall hold the deeds and
documents constituting the Title Deeds and Mortgage Loan Files and all
other certificates, notices, policies, endorsements and other matters
necessary to establish title thereto relating to the Mortgage Portfolio
that are in its possession or under its control or held to its order to
the order of the Mortgages Trustee or as the Mortgages Trustee shall
direct.
4.8. Early Repayment Charges: The Mortgages Trustee hereby agrees to pay to
the Seller as part of the Deferred Purchase Price any and all Early
Repayment Charge Receipts received by the Mortgages Trustee in respect of
the Mortgage Loans included in the New Mortgage Portfolio PROVIDED THAT,
if any Mortgage Loans in respect of which Early Repayment Charges are
payable are the subject of a trust pursuant to Clause 5.1 (Trust in
favour of Mortgages Trustee), the Seller, the Mortgages Trustee, each
Funding Beneficiary and each Funding Security Trustee agree that the
benefit of any Early Repayment Charges payable under such Mortgage Loan
shall, on the date of payment to the Seller of the related Early
Repayment Charge Receipts, be released from such trust.
4.9. Insurance: The Seller shall as soon as reasonably practical after
completion of the sale and assignment of each New Mortgage Portfolio
procure that the respective interests of the Mortgages Trustee, each
Funding Beneficiary and each Funding Security Trustee are noted by the
relevant insurers in relation to each Insurance Contract.
4.10. Mortgage Portfolio: Prior to the earliest to occur of:
(a) a Trigger Event; and
(b) if Funding does not enter into a New Intercompany Loan Agreement,
the Payment Date in January 2008; or
(c) on each occasion that Funding enters into a New Intercompany Loan
Agreement, the latest Payment Date specified by Funding by notice in
writing to the Seller and the Mortgages Trustee as applying in
relation to this covenant; or
(d) on each occasion that Funding 2 enters into a Funding 2 Intercompany
Loan Agreement or receives a further advance under any existing
Funding 2 Intercompany Loan Agreement, the latest Payment Date
specified by Funding
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2 by notice in writing to the Seller and the Mortgages Trustee as
applying in relation to this covenant,
the Seller undertakes to use all reasonable efforts to offer to sell and
assign, in accordance with the provisions of this Clause 4 (Sale and
Purchase of New Mortgage Portfolios), to the Mortgages Trustee, and the
Mortgages Trustee undertakes to use all reasonable endeavours to acquire
from the Seller and to hold pursuant to the terms of the Mortgages Trust
Deed, sufficient New Mortgage Loans and their Related Security so that
the Overcollateralisation Test is not breached on three consecutive
Distribution Dates PROVIDED THAT the Seller shall not be obliged to sell
and assign to the Mortgages Trustee, and the Mortgages Trustee shall not
be obliged to acquire, New Mortgage Loans and their Related Security if
in the opinion of the Seller the sale and assignment to the Mortgages
Trustee of New Mortgage Loans and their Related Security would adversely
affect the business of the Seller.
For the purposes of this Clause 4.10, the "Overcollateralisation Test"
shall be calculated on each Distribution Date and shall be breached on
any Distribution Date where the aggregate Current Balance of Mortgage
Loans in the Mortgage Portfolio on such Distribution Date is less than an
amount equal to the product of 1.05 and the Principal Amount Outstanding
of all Notes of all Issuers at such Distribution Date, and for this
purpose:
(i) where such Notes outstanding are Controlled Amortisation Notes
or Scheduled Redemption Notes, the Principal Amount Outstanding
of such Notes will be calculated on a straight-line basis by
applying the appropriate CPR to such Notes on a monthly, rather
than a quarterly basis; and
(ii) where such Notes outstanding are Bullet Redemption Notes, the
amount standing to the credit of the Funding 2 Cash
Accumulation Ledger will be deducted from the Principal Amount
Outstanding of such Notes.
4.11. Funding 2 Programme Date: On the Funding 2 Programme Date, the Seller
shall deliver to each Funding Security Trustee, each Funding Beneficiary
and the Mortgages Trustee or the representative of such party (or procure
such delivery to such party) an original power of attorney in the form
set out in Part 2 of Schedule 10 (Power of Attorney in favour of the
Mortgages Trustee, Funding, Funding 2, the Security Trustee and the
Funding 2 Security Trustee) duly executed by the Seller. On the delivery
of such power of attorney in accordance with the previous sentence, the
parties hereto agree that the power of attorney delivered by the Seller
on 26 March 2001 in accordance with Clause 3.1(a) shall terminate and be
of no further effect.
5. Trust of Monies
5.1. Trust in favour of Mortgages Trustee: Notwithstanding the assignment and
transfer effected by this Agreement (or by any Scottish Trust Deed made
pursuant hereto) if at, or at any other time after, the Initial Closing
Date or, as the case may be in respect of any New Mortgage Portfolio, the
relevant Assignment Date (but prior to any repurchase in accordance with
Clause 8.5 (Purchase of Product Switches, Further Advances and purchases
relating to Personal Secured Loans)) the Seller holds, or
11
there is held to its order, or it receives, or there is received to its
order any property, interest, right or benefit and/or the proceeds
thereof hereby agreed to be sold to the Mortgages Trustee, the Seller
undertakes with the Mortgages Trustee, each Funding Beneficiary and each
Funding Security Trustee that it will hold such property, interest, right
or benefit and/or the proceeds thereof upon trust for the Mortgages
Trustee (pursuant, in the case of any property, interest, right or
benefit and/or the proceeds thereof relating to a Scottish Mortgage Loan
or its Related Security, to the relevant Scottish Trust Deed) subject at
all times to the Mortgages Trust. In addition, if for any reason the
assignment and transfer of the Initial Mortgage Portfolio, or any New
Mortgage Portfolio (or any part thereof), or any property, interest,
right or benefit therein or any of the proceeds thereof (each a "relevant
asset"), is held to be ineffective or unenforceable against any Borrower,
the Seller undertakes with the Mortgages Trustee, each Funding
Beneficiary and each Funding Security Trustee and hereby declares that it
will hold such relevant asset upon trust for the Mortgages Trustee. The
Mortgages Trustee agrees that it will hold its beneficial interest in
such relevant asset subject at all times to the Mortgages Trust.
5.2. Trust in favour of Seller: If at, or any time after, the Initial Closing
Date (in the case of the Initial Mortgage Portfolio) or the relevant
Assignment Date (in the case of any New Mortgage Portfolio), the
Mortgages Trustee holds, or there is held to its order, or it receives,
or there is received to its order, any property, interest, right or
benefit relating to:
(a) any Mortgage Loan or Mortgage Loans under a Mortgage Account and its
Related Security repurchased by the Seller pursuant to Clause 8
(Warranties and Repurchase by the Seller); or
(b) (without prejudice to Clause 10 (Consequences of Breach)) any Early
Repayment Charges payable by a Borrower in respect of any Mortgage
Loan in the Mortgages Trust;
and/or the proceeds thereof, the Mortgages Trustee undertakes with the
Seller that it will remit, assign or transfer the same to the Seller, as
the case may require, and until it does so or to the extent that the
Mortgages Trustee is unable to effect such remittance, assignment or
transfer, the Mortgages Trustee undertakes to hold such property,
interest, right or benefit and/or the proceeds thereof upon trust for the
Seller as the sole beneficial owner thereof or as the Seller may direct
provided that the Mortgages Trustee shall not be in breach of its
obligations under this Clause 5 if, having received any such moneys and
paid them to third parties in error, it pays (at the direction of the
Beneficiaries) to the Seller an amount equal to the moneys so paid in
error in accordance with the Administration Agreement. In addition, if
the Seller is required or elects to repurchase any Mortgage Loan and its
Related Security pursuant to Clauses 8.4 (Repurchase), 8.5 (Purchase of
Product Switches, Further Advances and purchases relating to Personal
Secured Loans) or 8.6 (Repurchase of Fixed Rate Mortgage Loans) and such
Mortgage Loan or its Related Security, or any part thereof, or any
property, interest, right or benefit therein or any of the proceeds
thereof (each, a "relevant asset"), is held by the Seller subject to a
trust pursuant to Clause 5.1 (Trust in favour of
12
Mortgages Trustee), then the Seller, the Mortgages Trustee, each Funding
Beneficiary and each Funding Security Trustee agree that such relevant
asset shall be released from the trust constituted pursuant to Clause 5.1
(Trust in favour of Mortgages Trustee) on the date that such relevant
asset would otherwise have been repurchased or re-transferred pursuant to
Clause 8.7 (Completion of Repurchase).
6. Perfection of the Assignment
6.1. Perfection Events: The execution of transfers and assignations of the
Mortgages to the Mortgages Trustee and the notifications to Borrowers
notifying such Borrowers of the assignment or assignation of their
Mortgage Loans and Related Security to the Mortgages Trustee shall be
completed within 20 business days of receipt of a written request in
accordance with Clause 6.2 (Perfection) upon the occurrence of any of the
following events:
(a) the valid service:
(i) of a Funding Intercompany Loan Enforcement Notice;
(ii) of a Funding 2 Intercompany Loan Enforcement Notice;
(iii) of a Note Enforcement Notice (on any Funding Issuer); or
(iv) of an Issuer Enforcement Notice (on any Funding 2 Issuer),
provided that the perfection of an assignment of the Mortgage
Portfolio shall not be required if the sole reason for the service
of any Note Enforcement Notice (on any Funding Issuer) or any Issuer
Enforcement Notice (on any Funding 2 Issuer) is a default by a Swap
Provider of any Issuer;
(b) unless otherwise agreed by the Rating Agencies, the termination of
the Seller's role as Administrator under the Administration
Agreement and failure of any substitute administrator to assume the
duties of the Administrator; or
(c) the Seller being required by an order of a court of competent
jurisdiction, or by a change in law occurring after the Initial
Closing Date, or by a regulatory authority of which the Seller is a
member or with whose instructions it is customary that the Seller
comply, to perfect the transfer of legal title to the Mortgage Loans
and the Related Security in favour of the Mortgages Trustee; or
(d) the security under:
(i) the Funding Deed of Charge or any material part of such
security; or
(ii) the Funding 2 Deed of Charge or any material part of such
security,
being in jeopardy and it being necessary to perfect the transfer of
legal title to the Mortgage Loans and their Related Security in
favour of the Mortgages Trustee in order to reduce such jeopardy
materially; or
(e) the occurrence of an Insolvency Event in relation to the Seller; or
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(f) notice in writing from the Seller to the Mortgages Trustee and each
Funding Beneficiary (with a copy to each Funding Security Trustee)
requesting such transfer.
6.2. Perfection: If:
(a) an event set forth in any of paragraphs (b), (c), (e) or (f) of
Clause 6.1 (Perfection Events) occurs and either the Mortgages
Trustee or the Funding Beneficiaries (with the consent of the
Funding Security Trustees) or the Funding Security Trustees so
request in writing:
(b) an event set forth in any of paragraphs (a)(i), (a)(iii) or (d)(i)
of Clause 6.1 (Perfection Event) occurs and either the Mortgages
Trustee or Funding (with the consent of the Security Trustee) or the
Security Trustee so requests in writing: or
(c) an event set forth in any of paragraphs (a(ii), (a)(iv) or (d)(ii)
of Clause 6.1 (Perfection Event) occurs and either the Mortgages
Trustee or Funding 2 (with the consent of the Funding 2 Security
Trustee) or the Funding 2 Security Trustee so requests in writing,
the Seller shall perfect the assignments as contemplated by and in
accordance with this Clause 6 (Perfection of the Assignment) in
relation to all Mortgage Loans then in the Mortgage Portfolio and
shall:
(i) deliver to the Mortgages Trustee all Title Deeds and (subject
to receipt of up to date schedules) the transfers and
assignations referred to in Clause 6.3 (Transfer Documents)
duly executed by the Seller; and
(ii) give formal notice of the transfers and assignations to the
relevant Borrowers, insurers and other persons (all such
notices being in such form or forms as may be required by the
Mortgages Trustee or the Funding Beneficiaries (with the
written consent of the Funding Security Trustees) or the
Funding Security Trustees).
[As drafted, the ability by the funding beneficiaries and the funding
security trustees to request perfection is subject to controlling
directions, save for where enforcement notices have been served (under
(a)) or security is deemed to be in jeopardy (under (d)). In these
scenarios the Funding Beneficiary/security not involved in the process
has no say in the decision to request perfection.]
6.3. Transfer Documents: If an event set forth in any of paragraphs (a) to (f)
of Clause 6.1 (Perfection Events) occurs, the transfers that the Seller
is required to deliver are:
(a) transfers in the form set out in Part 1 of Schedule 2 (Form of
Transfer (Registered Land - England and Wales)) of all the English
Mortgages then in the Mortgage Portfolio secured (or intended to be
secured) over English Properties which comprise registered land
(including any English Property which is the subject of an
application for first registration at the Land Registry);
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(b) transfers in the form set out in Part 2 of Schedule 2 (Form of
Transfer (Unregistered Land - England and Wales)) of all the English
Mortgages then in the Mortgage Portfolio secured (or intended to be
secured) over English Properties which comprise unregistered land
(excluding any which is the subject of an application for first
registration);
(c) assignations in the form set out in Part 3 of Schedule 2 (Form of
Transfer (Land Register - Scotland)) of all the Scottish Mortgages
then in the Mortgage Portfolio secured (or intended to be secured
over Scottish Properties title to which is registered (or in the
course of being registered) in the Land Register of Scotland;
(d) assignations in the form set out in Part 4 of Schedule 2 (Form of
Transfer (Sasine Register - Scotland)) of all the Scottish Mortgages
then in the Mortgage Portfolio secured (or intended to be secured)
over Scottish Properties title to which is recorded (or in the
course of being recorded) in the General Register of Sasines;
(e) transfers and assignations of the benefit of the Guarantees relating
to any relevant Mortgage Loan in the form of the Assignment of
Guarantees set out in Part 1 of Schedule 5 (Assignment of
Guarantees) in relation to Guarantees governed by English law and in
the form of the Assignation of Guarantees set out in Part 2 of
Schedule 5 (Assignation of Guarantees) in relation to Guarantees
governed by Scots law; and
(f) transfers and assignations of the Related Security or any other
property or security sold to the Mortgages Trustee under this
Agreement in such form as the Mortgages Trustee or the Funding
Security Trustees may reasonably require.
The Mortgages Trustee or the Funding Beneficiaries (with the consent of
the Funding Security Trustees) or the Funding Security Trustees may
require that the form of any transfer or assignation referred to in this
Clause 6.3 be changed at any time to reflect changes in law or relevant
registry practice or requirements.
6.4. Prior to Perfection: Prior to perfection pursuant to Clause 6.1
(Perfection Events) and subject to Clause 7.3 (Seller Ratings) and
Clauses 3.6 (Insurance) and 4.9 (Insurance) neither the Mortgages
Trustee, any Funding Beneficiary nor any Funding Security Trustee will:
(a) register or record itself at, or submit or require the submission of
any notice, form, request or application to, or pay any fee for the
registration or recording of, or the noting of any interest at, the
Land Charges Department of H.M. Land Registry or in the Registers of
Scotland or at H.M. Land Registry in relation to the Mortgages
Trustee's and/or Funding's and/or Funding 2's interests in the
Mortgage Portfolio;
(b) give or require the giving of any notice to any Borrower, insurer or
any other person of:
15
(i) the assignment or assignation of that Borrower's Mortgage Loan
and its Related Security or such other property as may be
included in the Mortgage Portfolio to the Mortgages Trustee; or
(ii) the charge by Funding of Funding's beneficial interest in that
Borrower's Mortgage Loan and its Related Security or such other
property to the Security Trustee pursuant to the Funding Deed
of Charge; or
(iii) the charge by Funding 2 of Funding 2's beneficial interest in
that Borrower's Mortgage Loan and its Related Security or such
other property to the Funding 2 Security Trustee pursuant to
the Funding 2 Deed of Charge; or
(c) send or require to be sent to any solicitor who has acted on behalf
of the Seller in respect of any Mortgage with respect to which the
Seller has not received a complete set of the Title Deeds a letter
or other communication requiring such solicitor to hold such
documents to the order of the Mortgages Trustee, the Security
Trustee or the Funding 2 Security Trustee (as the case may be).
6.5. Further Assurance: The Seller shall, subject to the other provisions of
this Clause 6 (Perfection of the Assignment), upon request do all such
other deeds, assurances, agreements, instruments, acts and things as the
Mortgages Trustee, the Funding Beneficiaries or the Funding Security
Trustees may require in order to give effect to the terms of this
Agreement and the assignments and assignations contemplated herein.
7. Undertakings
7.1. Administration: The Mortgages Trustee and each Funding Beneficiary
undertake that they will at all times (or will direct the Administrator
at all times to) administer and enforce (and exercise their powers and
rights and perform their obligations under) the Mortgage Loans comprised
in the Mortgage Portfolio and their Related Security in accordance with
the Administration Procedures (for so long as these exist and thereafter
in accordance with such policies as would be applied by a reasonable,
prudent mortgage lender in the conduct of its business).
7.2. Reimbursement of Borrower: The Seller hereby undertakes with the
Mortgages Trustee and each Funding Beneficiary that, in the event that
any Borrower establishes that it has at any time prior to the Initial
Closing Date or, as the case may be, the relevant Assignment Date, paid
to the Seller any amounts in excess of sums due to the Seller as at the
date of payment under the Mortgage Conditions applicable to that Mortgage
Loan (other than any Overpayment made by a Borrower under Flexible
Mortgage Loan) the Seller will reimburse the Borrower for such
overpayment together with any interest, cost or other expense associated
therewith. The Seller further agrees to hold the Mortgages Trustee and
each Funding Beneficiary harmless against any such claims and to
indemnify the Mortgages Trustee and each Funding Beneficiary on an after
Tax basis in relation to any costs, expense, loss or other claim which
may arise in connection therewith. Any payment made by the Seller to the
Mortgages Trustee and each Funding Beneficiary in discharge of the
foregoing
16
indemnity shall be regarded as a rebate of part of the Purchase Price of
the relevant Mortgage Loan.
7.3. Seller Ratings: The Seller hereby undertakes with the Mortgages Trustee,
each Funding Beneficiary and each Funding Security Trustee that if the
long term unsecured, unsubordinated and unguaranteed debt obligations of
the Seller cease to be assigned a long term credit rating:
(a) from Xxxxx'x of no lower than Baal or from Fitch of no lower than
BBB+, the Seller (unless Xxxxx'x or Fitch, as applicable, confirms
that the then current ratings of the Notes will not be adversely
affected) will deliver to the Mortgages Trustee, each Funding
Beneficiary and each Funding Security Trustee (upon request) and the
Rating Agencies details of the names and addresses of the Borrowers
with Mortgage Loans then in the Mortgage Portfolio on computer
diskette and a draft letter of notice to such Borrowers of the sale
and assignment of those Mortgage Loans and the Related Security to
the Mortgages Trustee in the form set out in Schedule 8 (Form of
Notification to Borrowers); and
(b) from S&P of no lower than BBB-, from Xxxxx'x of no lower than Baa3
or from Fitch of no lower than BBB-, the Seller (unless S&P, Xxxxx'x
and Fitch, as applicable, confirms that the then-current ratings of
the Notes will not be adversely affected) shall within 10 Business
Days of such cessation give notice of the sale and assignment
effected by this Agreement (and, in the case of any Scottish
Mortgage Loan, the making of the relevant Scottish Trust Deed) to
each Borrower with a Mortgage Loan then in the Mortgage Portfolio in
the form set out in Schedule 8 (Form of Notification to Borrowers)
(and if the Seller fails to give such notice, then the Mortgages
Trustee shall give such notice as the Seller's attorney under the
power of attorney set out in Schedule 10 (Power of Attorney in
favour of the Mortgages Trustee, each Funding Beneficiary and each
Funding Security Trustee)),
(c) provided that, in respect of Clause 7.3(a), should the Seller be
required as described in such Clause to provide the details of the
names and addresses of Borrowers to the Mortgages Trustee and/or
each Funding Beneficiary, the Mortgages Trustee and each Funding
Beneficiary (to the extent, in respect of Funding, that such
information is to be delivered to Funding other than at its United
Kingdom branch office) hereby agrees to appoint an agent that is
located in the United Kingdom and which maintains all appropriate
registrations, notifications, licences and authorities (if any)
required under the Data Protection Xxx 0000 to receive and maintain
such information on its behalf, and under no circumstances shall
either the Mortgages Trustee or Funding accept such information at
its Jersey registered office or otherwise in Jersey (unless Jersey
is declared an "approved state" by the European Commission, in which
case such data may be delivered to the Mortgages Trustee and/or
Funding at their respective Jersey offices).
7.4. Pending Perfection: The Seller undertakes to the Mortgages Trustee, each
Funding Beneficiary and each Funding Security Trustee that, pending
perfection under Clause 6 (Perfection of the Assignment), the Seller:
17
(a) shall promptly notify the Mortgages Trustee, each Funding
Beneficiary and (upon request) each Funding Security Trustee if it
receives written notice of any litigation or claim calling into
question in any material way the Seller's or the Mortgages Trustee's
title to any Mortgage Loan comprised in the Mortgage Portfolio or
its Related Security or if it becomes aware of any material breach
of any of the Representations and Warranties or other obligations
under this Agreement; and
(b) shall, if reasonably required so to do by the Mortgages Trustee,
participate or join in and lend its name to and take such other
steps as may reasonably be required by the Mortgages Trustee in
relation to, any legal proceedings in respect of the Mortgage Loans
and the Related Security to the extent necessary to protect,
preserve and enforce the Seller's or the Mortgages Trustee's or any
Funding Beneficiary's or any Funding Security Trustee's title to or
interest in any Mortgage Loan or its Related Security provided that
the Seller is reimbursed, subject to and in accordance with the
relevant priority of payments under and in accordance with the
Transaction Documents, by the Mortgages Trustee and the Funding
Beneficiaries for the reasonable legal expenses and costs of such
proceedings.
7.5. Responsibility of Seller: The Seller hereby further undertakes with the
Mortgages Trustee and each Funding Beneficiary that it is and at all
times shall remain solely responsible for any Product Switches (other
than a Re-Fixed Mortgage Loan), for funding any Cash Re-Draws made by a
Borrower under a Flexible Mortgage Loan, for funding any request for any
Further Advance made by a Borrower, for funding any request for any
Further Draw under a Personal Secured Loan and for paying to the
Mortgages Trustee from time to time an amount equal to the Unpaid
Interest associated with any Non-Cash Re-Draw made by a Borrower under a
Flexible Mortgage Loan. For the avoidance of doubt, neither the Mortgages
Trustee nor any Funding Beneficiary will be required to advance moneys to
the Seller or to a Borrower in order to fund such a Re-Draw or Further
Advance or Further Draw in any circumstances whatsoever.
7.6. Product Switches and Further Advances:
(a) The Administrator shall not:
(i) accept an application from, or issue to any Borrower any offer
of a Further Advance; or
(ii) accept an application from, or issue to any Borrower any offer
of a Product Switch,
without first having given notice in writing to the Seller seeking
confirmation from the Seller that the Seller will repurchase the Mortgage
Loan to which such offer relates from the Mortgages Trustee in accordance
with the terms of this Agreement.
(b) If the Seller gives such confirmation to the Mortgages Trustee, the
Administrator shall then issue to that Borrower the relevant offer
referred to in paragraph (a) above on behalf of the Seller and shall
(in the case of any offer referred to in paragraph (a) above) then
notify the Seller and Mortgages
18
Trustee in writing as soon as the Administrator has accepted the
mortgage documentation completed by the Borrower in relation to such
offer.
(c) The Mortgages Trustee shall not itself offer or make any Product
Switch or Further Advance.
7.7. Standard Variable Rate: Subject to the provisions of Clause 7.9
(Shortfall), the Seller covenants with and undertakes to the Mortgages
Trustee, each Funding Beneficiary and each Funding Security Trustee that,
where the Administrator determines on any date that there will be a
Shortfall during the next succeeding Interest Period and notifies the
Seller to such effect, the Seller shall take all steps which are
necessary, including publishing any notice which is required in
accordance with the Mortgage Conditions, to set the Standard Variable
Rate and such other discretionary rates and margins applicable to the
Mortgage Loans at such levels as may be notified to the Seller by the
Mortgages Trustee, any Funding Beneficiary or any Funding Security
Trustee (which rates shall be the same rates as previously notified to
the Mortgages Trustee, each Funding Beneficiary and each Funding Security
Trustee in accordance with Clause 4.3(b) of the Administration Agreement)
as being the rates required in order for no Shortfall to arise.
7.8. Security Powers of Attorney: The Seller shall grant security powers of
attorney to the Mortgages Trustee, each Funding Beneficiary and each
Funding Security Trustee in the form set out in Schedule 10 (Power of
Attorney in favour of the Mortgages Trustee, each Funding Beneficiary and
each Funding Security Trustee) allowing the Mortgages Trustee, any
Funding Beneficiary and/or any Funding Security Trustee and their
delegates from time to time (inter alia) to set the Standard Variable
Rate, such other discretionary rates and margins applicable to the
Mortgage Loans and (save for any Funding Security Trustee) the rate of
(and terms relating to) the Existing Borrowers' Re-Fix Rate should the
Seller fail to do so in accordance with its obligations under this
Agreement, but only to the extent that such rates have been previously
notified to the Mortgages Trustee, each Funding Beneficiary and each
Funding Security Trustee in accordance with Clause 4.3(b) of the
Administration Agreement. Nothing in this Clause 7.8 shall prevent the
Seller (or any of its attorneys from time to time) from setting a higher
Northern Rock Standard Variable Rate or higher rates for other
discretionary rates and margins (or in the case of the Existing
Borrowers' Re-Fix Rate setting a higher rate and imposing terms more
advantageous to the Mortgages Trustee) than those to be set or required
by the Mortgages Trustee, each Funding Beneficiary and/or (other than in
respect to an Existing Borrower's Re-Fix Rate) each Funding Security
Trustee.
7.9. Shortfall: Unless the Mortgages Trustee, any Funding Beneficiary or any
Funding Security Trustee needs to do so to avoid a Shortfall, none of the
Mortgages Trustee, each Funding Beneficiary or each Funding Security
Trustee shall set the Standard Variable Rate and other discretionary
rates and margins for Mortgage Loans which are in the Mortgages Trust
(disregarding any discounts or additions to it) at rates higher than the
then equivalent rates for mortgage loans which are not in the Mortgages
Trust.
7.10. Forwarding of Notice: Each Funding Security Trustee undertakes, upon
receipt of any notice as specified in Clause 8.5(C) of the Mortgages
Trust Deed, to forward such notice to the Mortgages Trustee, each Funding
Beneficiary, the Seller and the Cash
19
Manager in the manner set forth in Clause 20 (Notices) within three (3)
London Business Days of receipt thereof. Each Funding Security Trustee
shall have no other obligation other than the foregoing following receipt
of such notice.
8. Warranties and Repurchase by the Seller
8.1. Representations and Warranties: The Seller makes the Representations and
Warranties set out in Schedule 1 (Representations and Warranties) to the
Mortgages Trustee, each Funding Beneficiary and each Funding Security
Trustee:
(a) in respect of each Mortgage Loan and its Related Security in the
Initial Mortgage Portfolio as at the date hereof and on the Initial
Closing Date;
(b) in relation to each New Mortgage Loan (other than Personal Secured
Loans if specifically excluded from a Representation and Warranty)
and its Related Security in a New Mortgage Portfolio, on the date of
the service of the relevant New Mortgage Portfolio Notice and on the
relevant Assignment Date;
(c) in the form set out in Part 2 of Schedule 1 (Representations and
Warranties) in relation to the matters and at the dates set out
therein; and
(d) in the form set out in Part 3 of Schedule 1 (Representations and
Warranties) in relation to the matters and at the dates set out
therein.
8.2. Reliance: The Seller acknowledges that the Representations and Warranties
are made with a view to inducing the Mortgages Trustee, each Funding
Beneficiary and each Funding Security Trustee either to enter into this
Agreement and the other Transaction Documents to which each is a party or
to agree to purchase the New Mortgage Loans and their Related Security
comprised in each New Mortgage Portfolio, and that the Mortgages Trustee,
each Funding Beneficiary and each Funding Security Trustee has entered
into this Agreement and the other Transaction Documents to which it is a
party in reliance upon the Representations and Warranties notwithstanding
any information possessed or discoverable by the Mortgages Trustee any
Funding Beneficiary and/or any Funding Security Trustee. The Mortgages
Trustee, each Funding Beneficiary and each Funding Security Trustee
acknowledges that they have not entered into this Agreement in reliance
upon any representation, warranty or undertaking other than those set out
in this Agreement or upon any other enquiry, investigation or search
whatsoever.
8.3. Remedies: The sole remedy of the Mortgages Trustee, each Funding
Beneficiary and each Funding Security Trustee in respect of a breach of
any of the Representations and Warranties shall be to take action under
this Clause 8 (Warranties and Repurchase by the Seller) or under Clause
8.4 (Adjustments to Trust Property) of the Mortgages Trust Deed.
Furthermore, in respect of any actual or alleged breach of Clause 8.1
(Representations and Warranties), the Mortgages Trustee, any Funding
Beneficiary or any Funding Security Trustee shall, as applicable:
(a) notify the Seller as soon as reasonably practicable following any
claim or intimation of claim by any person of or arising from such
actual or alleged breach and thereafter keep the Seller informed in
relation to such claim or intimation;
20
(b) not settle or compromise any such claim made or intimated or
otherwise do anything which may be prejudicial to the position of
the Seller in relation thereto having regard to this Agreement,
except pursuant to the written directions of the Seller or with the
Seller's prior written approval, such directions and approval not to
be unreasonably withheld; and
(c) comply with the Seller's reasonable directions as to answering,
disputing, defending, compromising, settling, or otherwise in
relation to the claim made or initiated (including without
limitation the instruction of particular legal advisers), and if and
to the extent required by the Seller, do such things as the Seller
may reasonably require to enable and authorise the Seller or persons
nominated by the Seller to answer, dispute, defend, compromise,
settle or otherwise deal with any such claim or intimated claim, or
mitigate loss or potential loss on behalf of the Mortgages Trustee,
subject in each case to the Seller indemnifying the Mortgages
Trustee each Funding Beneficiary and each Funding Security Trustee
against the consequences of complying with the Seller's directions
and requirements.
8.4. Repurchase: Subject to Clause 8.14 (Repurchase Not Possible), in the
event of a material breach of any of the Representations or Warranties in
respect of any Mortgage Loan and/or its Related Security as at the
Initial Closing Date or, as the case may be, the relevant Assignment
Date, which could have a material adverse effect on the Mortgage Loan
and/or its Related Security (having regard to, among other things,
whether a loss is likely to be incurred in respect of the Mortgage Loan
to which the breach relates after taking account of the likelihood of
recoverability or otherwise of any sums under any applicable insurance
policies), and further provided that:
(a) the Mortgages Trustee, the Funding Beneficiaries or the Funding
Security Trustees have given the Seller not less than 28 days'
notice in writing;
(b) the Mortgages Trustee has obtained the consent of the Funding
Security Trustees; and
(c) such breach, where capable of remedy, is not remedied to the
satisfaction of the Funding Beneficiaries and the Funding Security
Trustees within the 28 day period referred to in (a) (or such longer
period as the Funding Beneficiaries and the Funding Security
Trustees may direct the Mortgages Trustee),
then at the direction of the Funding Beneficiaries (with the consent of
the Funding Security Trustees) or the Funding Security Trustees, the
Mortgages Trustee may serve upon the Seller a notice in the form of the
Loan Repurchase Notice whereupon the Seller will be required to
repurchase (i) the relevant Mortgage Loan and its Related Security, (ii)
any other Mortgage Loan secured or intended to be secured by that Related
Security or any part of it and (iii) any other Mortgage Loan secured on
the same Mortgaged Property as the relevant Mortgage Loan to which the
breach relates in accordance with Clause 8.7 (Completion of Repurchase),
provided, however, that the Funding Security Trustees shall have no duty
to provide any such notice to the Seller or consider granting their
consent pursuant to this Clause 8.4 unless the Funding Security Trustees
have been notified by a party to a Transaction Document of such material
breach of such Representation or Warranty which, in the opinion of such
party (as communicated to the Funding Security Trustees), could have a
material
21
adverse effect on the related Mortgage Loan and/or its Related Security,
taking into account the considerations provided in this Clause 8.4, and
further provided that prior to receipt of such notice the Funding
Security Trustees shall be entitled to assume that no such material
breach has occurred.
[This Clause is subject to controlling directions]
8.5. Purchase of Product Switches, Further Advances and purchases relating to
Personal Secured Loans: In the event of there being at any date in
respect of any Mortgage Loan assigned to the Mortgages Trustee hereunder
a PS/FA/PSL Event (other than a Mortgage Loan becoming a Re-Fixed
Mortgage Loan, such PS/FA/PSL Event being dealt with under Clause 8.6
(Repurchase of Fixed Rate Mortgage Loans)), the Seller may at any time
serve notice in the form of the Loan Repurchase Notice on the Mortgages
Trustee whereupon the Mortgages Trustee will be required to sell and to
transfer to the Seller in accordance with Clause 8.7 (Completion of
Repurchase):
(a) any Mortgage Loan subject to a PS/FA/PSL Event, together with its
Related Security;
(b) any other Mortgage Loan secured or intended to be secured by the
Related Security referred to in (a) above or any part of it; and
(c) any other Mortgage Loan secured on the same Mortgaged Property that
secures the Mortgage Loan subject to a PS/FA/PSL Event, together
with its Related Security,
each such Mortgage Loan to be identified in the Loan Repurchase Notice
(any such Mortgage Loan or Mortgage Loans, a "PS/FA/PSL Mortgage Loan"),
free from the Mortgages Trust and any right or interest that any Funding
Security Trustee may have in such PS/FA/PSL Mortgage Loan and its Related
Security under the Funding Deed of Charge and/or the Funding 2 Deed of
Charge (as applicable). Any PS/FA/PSL Mortgage Loan purchased by the
Seller shall be released from the Mortgages Trust and shall no longer
constitute Trust Property and shall be released from any right or
interest that any Funding Security Trustee may have had in such Mortgage
Loan and its Related Security under the Funding Deed of Charge and/or the
Funding 2 Deed of Charge (as applicable) prior to such repurchase.
8.6. Repurchase of Fixed Rate Mortgage Loans:
(a) Where a Mortgage Loan bears interest at a fixed rate for a certain
period (the "initial fixed rate period"), after the expiry of which
the Borrower is entitled to exercise an option for a new fixed rate
(whether or not subject to certain conditions), the Mortgages
Trustee may by notice in writing to the Seller given at any time not
more than 60 days before the expiry of that initial fixed rate
period (which for the avoidance of doubt shall exclude any period of
extension to which the relevant Borrower is entitled), offer to
re-sell to the Seller that Mortgage Loan together with its Related
Security if that Mortgage Loan becomes a Re-Fixed Mortgage Loan
during the 3-month period immediately following the end of that
initial fixed rate period. The offer will
22
be in writing in the form set out in Schedule 9 (Offer under Clause
8.6 ) and will be signed by or on behalf of the Mortgages Trustee.
(b) The Seller may accept the offer made in accordance with paragraph
(a) above on the date on which that Mortgage Loan becomes a Re-Fixed
Mortgage Loan during the 3-month period immediately following the
end of the initial fixed rate period relating to it, only by payment
to the Mortgages Trustee of the consideration payable for the
repurchase of the relevant Mortgage Loan and its Related Security in
accordance with Clause 8.7 (Completion of Repurchase).
(c) The parties hereto acknowledge that the effect of the payment to the
Mortgages Trustee by the Seller of the consideration for the
repurchase of the relevant Mortgage Loan and its Related Security in
accordance with paragraph (b) above will be the assignment and
transfer to the Seller of the beneficial ownership of, and all of
the Mortgages Trustee's beneficial right, title, interest and
benefit in and to, that Mortgage Loan, and completion of the
repurchase shall be effected by the parties in accordance with
Clause 8.7 (Completion of Repurchase).
(d) The Seller hereby covenants and undertakes that if it does not
accept the offer made by the Mortgages Trustee in accordance with
paragraph (b) above, then whether or not the Mortgage Loan becomes a
Re-Fixed Mortgage Loan, it will set the Existing Borrowers' Re-Fix
Rate applicable for the 3-month period immediately after expiry of
the initial fixed rate period relating to that Mortgage Loan at a
rate not less than that (and on terms not less advantageous to the
Mortgages Trustee or the Funding Beneficiaries than those) notified
from time to time to the Seller by the Mortgages Trustee, the
Funding Beneficiaries or the Administrator as being required by the
Mortgages Trustee or any Funding Beneficiary.
8.7. Completion of Repurchase: Completion of any repurchase or re-transfer or
purchase or transfer, as applicable, shall take place:
(a) in the case of any repurchase or re-transfer pursuant to Clause 8.4
(Repurchase) or any purchase or transfer pursuant to Clause 8.5
(Purchase of Product Switches, Further Advances and purchases
relating to Personal Secured Loans) on the first London Business Day
immediately following expiry of a period of 10 days following the
date of the service upon the Seller of the relevant Loan Repurchase
Notice or at the Seller's earlier election; or
(b) in the case of any repurchase or re-transfer pursuant to Clause 8.6
(Repurchase of Fixed Rate Mortgage Loans), immediately upon the
Mortgage Loan becoming a Re-Fixed Mortgage Loan,
whereupon, the Seller shall pay to the Mortgages Trustee an amount equal
to the Current Balance of such Mortgage Loan or Mortgage Loans and any
Related Security and all Arrears of Interest and Accrued Interest
relating thereto as at the date of completion of such repurchase. The
provisions of Clause 8.8 (Transfers), Clause 8.9 (Documentation) and
Clause 8.16 (Scottish Trust) shall apply to any such repurchase or
re-transfer.
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8.8. Transfers: On the date of completion of any repurchase of a Mortgage Loan
and its Related Security in accordance with this Clause 8 (Warranties and
Repurchase by the Seller), the Mortgages Trustee and each Funding
Beneficiary shall at the cost of the Seller execute and deliver or cause
their respective duly authorised attorneys to execute and deliver to the
Seller:
(a) if perfection of the assignment and assignation to the Mortgages
Trustee has occurred in accordance with Clause 6 (Perfection of the
Assignment):
(i) if the relevant Mortgage is over Registered Land, a transfer of
such Mortgage to the Seller in the form of the Registered
Transfer; or
(ii) if the relevant Mortgage is over Unregistered Land, a transfer
to the Seller in the form of the Unregistered Transfer; or
(iii) if the relevant Mortgage is a Scottish Mortgage, an
assignation to the Seller in the applicable form of Scottish
Transfer;
(b) a re-assignment or retrocession of the rights of the Mortgages
Trustee in respect of the relevant Related Security each in a form
reasonably acceptable to the Seller (which shall, in the case of the
re-assignment of the Insurance Contracts, be substantially in the
form of the Assignment of Insurance Contracts set out in Schedule 3
(Assignment of Insurance Contracts); and
(c) a notification to the Administrator that all further sums due in
respect of such repurchased Mortgage Loan are for the Seller's
account.
8.9. Documentation: Upon any completion of the repurchase of any Mortgage Loan
and its Related Security in accordance with this Clause 8 (Warranties and
Repurchase by the Seller) the Seller shall cease to be under any further
obligation to hold any Title Deeds or other documents relating to such
Mortgage Loan or Mortgage Loans and its Related Security to the order of
the Mortgages Trustee and any Funding Security Trustee and if the
Mortgages Trustee or any Funding Security Trustee then holds the Title
Deeds, the Mortgages Trustee or, as the case may be, such Funding
Security Trustee shall forthwith return them to the Seller. Any such
repurchase by the Seller of a Mortgage Loan or Mortgage Loans and its or
their Related Security shall constitute a discharge and release of the
Seller from any claims which the Mortgages Trustee and/or any Funding
Beneficiary and/or any Funding Security Trustee may have against the
Seller arising from the relevant Representation or Warranty in relation
to that Mortgage Loan or Mortgage Loans and its or their Related Security
only, but shall not affect any rights arising from a breach of any other
express provision of this Agreement or any Representation or Warranty in
relation to any other Mortgage Loan and other Related Security.
8.10. Notification: Forthwith after the Seller becomes aware of any event
which may reasonably give rise to an obligation under this Clause 8
(Warranties and Repurchase by the Seller) to repurchase any Mortgage
Loan it shall notify the Mortgages Trustee, each Funding Beneficiary and
each Funding Security Trustee in writing thereof as soon as reasonably
practicable.
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8.11. No Prejudice: The terms of this Clause 8 (Warranties and Repurchase by
the Seller) shall not prejudice the rights of the Mortgages Trustee or
the Beneficiaries under the Mortgages Trust Deed.
8.12. Claims against Seller: If a breach of a Representation or Warranty
arises in respect of any Mortgage Loan and (in either case) no repurchase
requirement arises in respect of the Seller pursuant to this Clause 8
(Warranties and Repurchase by the Seller), neither the Mortgages Trustee,
nor any Funding Beneficiary or any Funding Security Trustee shall have
any claim against the Seller in respect of, or in relation to, such
breach of Representation or Warranty in relation to that Mortgage but
without prejudice to Clause 8.14 (Repurchase Not Possible) and Clause
8.15 (Indemnity) of this Agreement and Clause 8.5 (Adjustments to Trust
Property) of the Mortgages Trust Deed. For the avoidance of doubt, save
as provided for in this Clause 8 (Warranties and Repurchase by the
Seller), the Seller is not obliged to repurchase any other Mortgage Loan
or its Related Security.
8.13. Assignment: If the Seller makes any payment to the Mortgages Trustee GIC
Account (or as the Mortgages Trustee shall direct) in full satisfaction
of any claim made by the Mortgages Trustee, any Funding Beneficiary or
any Funding Security Trustee in relation to any Representation or
Warranty set out in Schedule 1 (Representations and Warranties), the
Mortgages Trustee, each Funding Beneficiary and each Funding Security
Trustee, as the case may be, shall assign to the Seller such rights as
they have against any third party which relate to such claim.
8.14. Repurchase Not Possible: If a Mortgage Loan has never existed, or has
ceased to exist, such that it is not outstanding on the date on which it
is due to be repurchased pursuant to this Clause 8 (Warranties and
Repurchase by the Seller), the Seller shall not be obliged to repurchase
the Mortgage Loan and the Related Security but shall instead indemnify
the Mortgages Trustee, each Funding Beneficiary and each Funding Security
Trustee against any loss suffered by reason of any Representation or
Warranty relating to or otherwise affecting that Mortgage Loan being
untrue or incorrect by reference to the facts subsisting at the date on
which the relevant Representation or Warranty was given, provided that
the amount of such indemnity shall not exceed the sum of (i) the Current
Balance of the Mortgage Loan that would have been payable by the Borrower
in respect of such Mortgage Loan on and after the relevant completion
date for the repurchase in relation to such Mortgage Loan had the
Mortgage Loan existed and complied with each of the Representations and
Warranties set out Schedule 1 (Representations and Warranties) as at such
date in relation to such Mortgage Loan and (ii) interest thereon from
such relevant completion date at the weighted average yield of the
Mortgage Loans.
8.15. Indemnity: The Seller shall indemnify the Mortgages Trustee against any
loss suffered as a result of any Borrower exercising a Right of Set Off
against the Mortgages Trustee provided that the amount of such indemnity
in relation to any Mortgage Loan shall not exceed the sum of the Current
Balance of that Mortgage Loan and interest payable by the Borrower under
that Mortgage Loan as at the date that the Borrower exercises the Right
of Set Off. In this clause "Right of Set Off" means any right of set off
arising from a deposit of money made by the Borrower with the Seller or
from any transaction between the Borrower and the Seller other than one
relating to the Mortgage Loan.
25
8.16. Scottish Trust: Upon any completion of the repurchase or purchase by the
Seller of any Scottish Mortgage Loan and its Related Security in
accordance with this Clause 8 (Warranties and Repurchase by the Seller)
such Scottish Mortgage Loan and its Related Security shall thereupon be
released from the Scottish Trust and shall cease to form part of the
Scottish Trust Property.
9. Further Assurance
The parties hereto agree that they will co-operate fully to do all such
further acts and things and execute any further documents that may be
necessary or desirable to give full effect to the transactions
contemplated by this Agreement (but subject always to Clause 6
(Perfection of the Assignment)).
10. Consequences of Breach
Without prejudice to Clause 8 (Warranties and Repurchase by the Seller),
the Mortgages Trustee, each Funding Beneficiary and each Funding Security
Trustee severally acknowledges to and agrees with the Seller, and each
Funding Security Trustee severally acknowledges to and agrees with each
Funding Beneficiary and the Mortgages Trustee (and with each other
Funding Security Trustee), that the Seller shall have no liability or
responsibility (whether, in either case, contractual, tortious or
delictual, express or implied) for any loss or damage for or in respect
of any breach of, or any act or omission in respect of, any of its
obligations hereunder other than loss or damage directly (and not
indirectly or consequentially) suffered by:
(a) the Mortgages Trustee; and/or
(b) Funding or the assets comprised in the Funding Security constituted
by the Funding Deed of Charge; and/or
(c) Funding 2 or the assets comprised in the Funding 2 Security
constituted by the Funding 2 Deed of Charge,
by reason of such breach, act or omission. For this purpose (and without
limiting the scope of the above exclusion in respect of indirect or
consequential loss or damage) any loss or damage suffered by the
Mortgages Trustee and/or any Funding Beneficiary or such assets which
would not have been suffered by it or such assets had the breach, act or
omission in question not also been or given rise to an Event of Default
or enforcement of the security constituted by the Funding Deed of Charge
or enforcement of the security constituted by the Funding 2 Deed of
Charge shall be treated as indirect or consequential loss or damage.
11. Subordination
The Seller agrees with the Mortgages Trustee, each Funding Beneficiary
and each Funding Security Trustee that on the enforcement of any Mortgage
any sums owed to the Seller by a Borrower secured under such Mortgage and
the rights and remedies of the Seller in respect of the sums owed to the
Seller shall at all times be subject and subordinated to any sums owed to
the Mortgages Trustee by the Borrower and to the rights and remedies of
the Mortgages Trustee in respect of such sums owed to the Mortgages
Trustee by the Borrower.
26
12. Non-Merger
Any term of this Agreement to which effect is not given on the Initial
Closing Date or on any Assignment Date (including in particular, but
without limitation, the liability of the Seller under the Representations
and Warranties and the provisions of Clause 4 (Sale and Purchase of New
Mortgage Portfolios)) shall not merge and shall remain in full force and
effect notwithstanding the sale and purchase contemplated by this
Agreement.
13. No Agency or Partnership
It is hereby acknowledged and agreed by the parties that nothing in this
Agreement shall be construed as giving rise to any relationship of
agency, save as expressly provided herein, or partnership between the
parties and that in fulfilling its obligations hereunder, each party
shall be acting entirely for its own account.
14. Payments
All payments to be made pursuant to this Agreement shall be made in
sterling in immediately available funds without exercising or seeking to
exercise any right of set-off as may otherwise exist and shall be deemed
to be made when they are received by the payee and shall be accounted for
accordingly unless failure to receive any payment is due to an error by
the payee's bank.
15. Assignment
15.1. Assignment: Subject always to the provisions of Clause 16 (Funding
Security Trustees), no party hereto shall be entitled to assign all or
any part of its rights or obligations hereunder to any other party
without the prior written consent of each of the other parties hereto
(which shall not, if requested, be unreasonably withheld) save that:
(a) Funding shall be entitled to assign by way of security all or any of
its rights under this Agreement without such consent to the Security
Trustee pursuant to the Funding Deed of Charge and the Security
Trustee may at its sole discretion assign all or any of its rights
under or in respect of this Agreement without such consent to any
successor Security Trustee under the Funding Deed of Charge and may
assign all of any part of the Funding Security upon an enforcement
of the Funding Security in accordance with the Funding Deed of
Charge; and
(b) Funding 2 shall be entitled to assign by way of security all or any
of its rights under this Agreement without such consent to the
Funding 2 Security Trustee pursuant to the Funding 2 Deed of Charge
and the Funding 2 Security Trustee may at its sole discretion assign
all or any of its rights under or in respect of this Agreement
without such consent to any successor Funding 2 Security Trustee
under the Funding 2 Deed of Charge and may assign all of any part of
the Funding 2 Security upon an enforcement of the Funding 2 Security
in accordance with the Funding 2 Deed of Charge.
27
15.2. Acknowledgement of Security Assignment: The Seller acknowledges that:
(a) on the assignment by Funding of its rights under this Agreement to
the Security Trustee pursuant to the Funding Deed of Charge, the
Security Trustee may enforce such rights in the Security Trustee's
own name without joining Funding in any such action (which right the
Seller hereby waives) and the Seller hereby waives as against the
Security Trustee any rights or equities in its favour arising from
any course of dealing between the Seller and Funding; and
(b) on the assignment by Funding 2 of its rights under this Agreement to
the Funding 2 Security Trustee pursuant to the Funding 2 Deed of
Charge, the Funding 2 Security Trustee may enforce such rights in
the Funding 2 Security Trustee's own name without joining Funding 2
in any such action (which right the Seller hereby waives) and the
Seller hereby waives as against the Funding 2 Security Trustee any
rights or equities in its favour arising from any course of dealing
between the Seller and Funding 2.
16. Funding Security Trustees
16.1. Vesting of Rights: If there is any change in the identity of the
security trustee in accordance with the Funding Deed of Charge, the
Seller, the Mortgages Trustee, each Funding Beneficiary and the Funding 2
Security Trustee shall execute such documents and take such action as the
successor security trustee and the outgoing security trustee may require
for the purpose of vesting in the successor security trustee the rights
and obligations of the outgoing security trustee hereunder and releasing
the outgoing security trustee from its future obligations under this
Agreement and the Seller shall give notice thereof to the Rating
Agencies. If there is any change in the identity of the security trustee
in accordance with the Funding 2 Deed of Charge, the Seller, the
Mortgages Trustee, each Funding Beneficiary and the Security Trustee
shall execute such documents and take such action as the successor
security trustee and the outgoing security trustee may require for the
purpose of vesting in the successor security trustee the rights and
obligations of the outgoing security trustee hereunder and releasing the
outgoing security trustee from its future obligations under this Deed.
16.2. No Assumption: It is hereby acknowledged and agreed that by its
execution of this Agreement no Funding Security Trustee shall assume or
have any of the obligations or liabilities of the Seller, any Funding
Beneficiary or the Mortgages Trustee or any other Funding Security
Trustee hereunder. Furthermore, any liberty or power which may be
exercised or any determination which may be made hereunder by a Funding
Security Trustee may be exercised or made in its absolute discretion
without any obligation to give reasons therefor, but in any event must be
exercised or made in accordance with the provisions of the Funding Deed
of Charge or the Funding 2 Deed of Charge (as applicable) and the Funding
Beneficiary Deed. Without prejudice to the generality of the foregoing,
all references to any Funding Security Trustee taking action in
connection with any duty of the Seller shall also be read subject to
Clause 25 and Schedule 4 of the Administration Agreement.
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17. New Intercompany Loans
On each occasion that a Funding Beneficiary enters into an Intercompany
Loan Agreement or is the recipient of a loan advance under an
Intercompany Loan Agreement, then the Seller, the Mortgages Trustee, each
Funding Beneficiary and each Funding Security Trustee shall execute such
documents and take such action as may be required by the Rating Agencies
for the purpose of including the applicable Issuer in the Transaction and
or providing for the rights and obligations of such Issuer, including,
without limitation:
(a) effecting any necessary changes to Clause 4 (Sale and Purchase of
New Mortgage Portfolios);
(b) ensuring that any Transaction Document relevant to such Issuer has
been executed and delivered prior to the relevant Closing Date;
(c) executing and delivering all documents required by Clause 4.4
(Closing and Conditions Precedent) in relation to any New Mortgage
Portfolio.
18. Non Petition Covenant; Limited Recourse
18.1. Non Petition Covenant: [Each of the parties hereto hereby agrees that it
shall not institute against any Funding Beneficiary or the Mortgages
Trustee any winding-up, administration, insolvency or similar proceedings
so long as any sum is outstanding under any Intercompany Loan Agreement
of any Issuer or for two years plus one day since the last day on which
any such sum was outstanding.]
18.2. Limited Recourse: Each of the parties hereto agrees that:
(a) in relation to the Mortgages Trustee, any amount payable by the
Mortgages Trustee to any other party to this Agreement under this
Agreement not being an amount payable out of the Trust Property in
accordance with the terms of the Mortgages Trust Deed shall only be
payable to the extent that on that date the Mortgages Trustee has
sufficient funds to pay such amount out of fees paid to it under the
Mortgages Trust Deed; and
(b) in relation to Funding:
(i) only the Security Trustee may enforce the security created in
favour of the Security Trustee under the Funding Deed of Charge
in accordance with the provisions thereof;
(ii) notwithstanding any other provision of this Agreement or any
other Transaction Document, no sum due or owing to any party to
this Agreement from or by Funding under this Agreement shall be
payable by Funding except to the extent that Funding has
sufficient funds available or (following enforcement of the
Funding Security) the Security Trustee has realised sufficient
funds from the Funding Security to pay such sum subject to and
in accordance with the relevant Funding Priority of Payments
and provided that all liabilities of Funding required to be
paid in priority thereto or pari passu therewith
29
pursuant to such Funding Priority of Payments have been paid,
discharged and/or otherwise provided for in full; and
(iii) it shall not take any steps for the purpose of recovering any
amount payable by Funding or enforcing any rights arising out
of this Agreement against Funding otherwise than in accordance
with the Funding Deed of Charge.
(c) in relation to Funding 2:
(i) only the Funding 2 Security Trustee may enforce the security
created in favour of the Funding 2 Security Trustee under the
Funding 2 Deed of Charge in accordance with the provisions
thereof;
(ii) notwithstanding any other provision of this Agreement or any
other Transaction Document, no sum due or owing to any party to
this Agreement from or by Funding 2 under this Agreement shall
be payable by Funding 2 except to the extent that Funding 2 has
sufficient funds available or (following enforcement of the
Funding 2 Security) the Funding 2 Security Trustee has realised
sufficient funds from the Funding 2 Security to pay such sum
subject to and in accordance with the relevant Funding 2
Priority of Payments and provided that all liabilities of
Funding 2 required to be paid in priority thereto or pari passu
therewith pursuant to such Funding 2 Priority of Payments have
been paid, discharged and/or otherwise provided for in full;
and
(iii) it shall not take any steps for the purpose of recovering any
amount payable by Funding 2 or enforcing any rights arising out
of this Agreement against Funding 2 otherwise than in
accordance with the Funding 2 Deed of Charge.
18.3. Corporate Obligations: To the extent permitted by law, no recourse under
any obligation, covenant, or agreement of any person contained in this
Agreement shall be had against any shareholder, officer or director of
such person as such, by the enforcement of any assessment or by any legal
proceeding, by virtue of any statute or otherwise; it being expressly
agreed and understood that this Agreement is a corporate obligation of
each person expressed to be a party hereto and no personal liability
shall attach to or be incurred by the shareholders, officers, agents or
directors of such 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. Amendments and Waiver
19.1. Entire Agreement: This Agreement sets out the entire agreement and
understanding between the parties with respect to the subject matter of
this Agreement superseding all prior oral or written understandings other
than the other Transaction Documents.
30
19.2. 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.
19.3. 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. Notices
Any notices or other communication or document to be given or delivered
pursuant to this Agreement to any of the parties hereto shall be
sufficiently served if sent by prepaid first class post, by hand or by
facsimile transmission and shall be deemed to be given (in the case of
facsimile transmission) when despatched or (where delivered by hand) on
the day of delivery if delivered before 17.00 hours on a London Business
Day or on the next London Business Day if delivered thereafter or (in the
case of first class post) when it would be received in the ordinary
course of the post and shall be sent:
(a) in the case of the Seller, to Northern Rock plc, Xxxxxxxx Xxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (facsimile number 0191
213 2203) for the attention of the Group Secretary;
(b) in the case of the Mortgages Trustee, to Granite Finance Trustees
Limited, 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel
Islands, (facsimile number 01534 609 333) for the attention of the
Company Secretary;
(c) in the case of Funding, to Granite Finance Funding Limited, 00 Xxxx
Xxxx, Xxxxxxx XX0 0XX, (facsimile number 020 8409 8911) for the
attention of the Company Secretary; and
(d) in the case of the Security Trustee, to The Bank of New York (London
Branch), at Xxx Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx X00 0XX (facsimile
number 020 7964 6399) for the attention of Corporate Trust (Global
Structured Finance),
(e) in the case of Funding 2, to Granite Finance Funding 2 Limited,
Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx, XX0X 0XX (facsimile number 020
7606 0643), for the attention of the Company Secretary (with a copy
to the Seller in accordance with (a) above);
(f) in the case of the Funding 2 Security Trustee, to The Bank of New
York, 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile
number 020 7964 6399), for the attention of Global Structured
Finance (Corporate Trust);
31
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 to the others by fifteen days prior written notice in
accordance with the provisions of this Clause 20.
21. 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.
22. Execution in Counterparts; Severability
22.1. 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.
22.2. 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.
23. Governing Law and Submission to Jurisdiction
23.1. Governing Law: This Agreement is governed by, and shall be construed in
accordance with, English law (PROVIDED THAT any terms of this Agreement
which are particular to the law of Scotland shall be construed in
accordance with Scots law).
23.2. Submission to Jurisdiction: Each of the parties hereto irrevocably
agrees that the courts of England shall have jurisdiction to hear and
determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and, for such
purposes, irrevocably submits to the jurisdiction of such courts.
24. Process Agent
The Mortgages Trustee irrevocably and unconditionally appoints Mourant &
Co. Capital (SPV) Limited at 00 Xxxx Xxxx, Xxxxxxx XX0 0XX or otherwise
at its registered office for the time being as its agent for service of
process in England in respect of any proceedings in respect of this
Agreement and undertakes that in the event of Mourant & Co. Capital (SPV)
Limited ceasing so to act it will appoint another person with a
registered office in London as its agent for service of process.
25. Appropriate Forum
Each of the parties hereto irrevocably waives any objection which it
might now or hereafter have to the courts of England being nominated as
the forum to hear and determine any Proceedings and to settle any
disputes, and agrees not to claim that any such court is not a convenient
or appropriate forum.
32
26. Transaction Documents
To the extent necessary to comply with the requirements of Section 2 Law
of Property (Miscellaneous Provisions) Xxx 0000, this Agreement
incorporates by reference to them the Transaction Documents.
33
AS WITNESS whereof the parties hereto have executed this Agreement for
delivery on the day and year first before written.
EXECUTED for and on behalf of )
NORTHERN ROCK PLC )
by: )
---------------------------
Authorised Signatory
Title:
----------------------------
EXECUTED for and on behalf of )
GRANITE FINANCE TRUSTEES LIMITED )
by: )
---------------------------
Authorised Signatory
Name:
Title:
EXECUTED for and on behalf of )
GRANITE FINANCE FUNDING LIMITED )
by: )
---------------------------
Authorised Signatory
Name:
Title:
EXECUTED for and on behalf of )
THE BANK OF NEW YORK )
by: )
---------------------------
Authorised Signatory
Name:
Title:
34
SCHEDULE 1
REPRESENTATIONS AND WARRANTIES
Part 1
1. The particulars of each Mortgage Loan and its related Mortgage in the
Initial Mortgage Portfolio set out in Appendix A to this Agreement are
complete, true and accurate in all material respects.
2. Immediately prior to a Closing Date or an Assignment Date, as the case
may be, subject to completion of any registration or recording which may
be pending at H.M. Land Registry or the Registers of Scotland, the Seller
was the absolute beneficial and legal owner of the Mortgages, the Related
Security and the other property to be assigned and transferred by the
Seller to the Mortgages Trustee under this Agreement at such Closing Date
or such Assignment Date, as the case may be, and the Seller has not
assigned (whether by way of absolute assignment or by way of security
only), transferred, charged, disposed of or dealt with the benefit of any
of the Mortgage Loans or their related Mortgages, any of the other rights
relating thereto or any of the property, rights, titles, interests or
benefits to be sold or assigned pursuant to this Agreement other than
pursuant to this Agreement.
3. With the exception of Personal Secured Loans, each Mortgage Loan and its
related Mortgage and the Related Security constitutes a valid and binding
obligation of the Borrower enforceable in accordance with its terms (save
any terms which are not binding by virtue of the Unfair Terms in Consumer
Contracts Regulations 1994 or the Unfair Terms in Consumer Contracts
Regulations 1999) and each such related Mortgage and the Related Security
secures the repayment of all advances, interest, costs and expenses
payable by the relevant Borrower to the Seller in priority to any other
charges registered against the relevant Mortgaged Property.
4. At the time that it was made, each Mortgage Loan (other than Personal
Secured Loans) complied in all respects with applicable laws, regulations
and rules including, without limitation, consumer protection, data
protection and contract law.
5. Subject to completion of any registration which may be pending at H.M.
Land Registry or the Registers of Scotland, each Mortgage (other than a
Mortgage in respect of a Regulated Personal Secured Loan) either
constitutes, or will constitute, following registration at H.M. Land
Registry (in England and Wales), a first ranking charge by way of legal
mortgage or following registration or recording at the Registers in
Scotland, a first ranking standard security over the relevant Mortgaged
Property.
6. Each relevant Mortgaged Property is located in England, Wales or
Scotland.
7. All steps necessary to perfect the Seller's title to each Mortgage Loan
and its related Mortgage were duly taken at the appropriate time or are
in the process of being taken with all due diligence.
8. No lien or right of set-off or counterclaim (other than a Right of
Set-off referred to in Clause 8.15 (Indemnity)) has been created or
arisen between the Seller and any Borrower which would entitle such
Borrower to reduce the amount of any payment
35
otherwise due under the relevant Mortgage Loan save in relation to the
Unfair Terms in Consumer Contracts Regulations 1994 or the Unfair Terms
in Consumer Contracts Regulations 1999 and save in relation to section 75
of the Consumer Credit Xxx 0000.
9. Prior to making a Mortgage Loan to a Borrower, the Seller instructed or
required to be instructed on its behalf solicitors to carry out in
relation to the relevant Mortgaged Property all investigations, searches
and other actions that would have been undertaken by the Seller acting in
accordance with standards consistent with those of a reasonable and
prudent mortgage lender, lending to Borrowers in England and Wales (in
respect of English Mortgage Loans) and Scotland (in respect of Scottish
Mortgage Loans), when advancing money in an amount equal to such advance
to an individual to be secured on a mortgaged property of the kind
permitted under the Lending Criteria and a report on title was received
by or on behalf of the Seller from such solicitors which, either
initially or after further investigation revealed no material matter
which would cause the Seller, acting reasonably, to decline the Mortgage
Loan having regard to the Lending Criteria.
10. In relation to each Mortgage the Borrower has a good and marketable title
to the relevant Mortgaged Property.
11. Prior to making a Mortgage Loan the relevant Mortgaged Property was
valued by an independent valuer from the panel of valuers from time to
time appointed by the Seller or by an employee valuer of the Seller, and
the results of such valuation would be acceptable to a reasonable and
prudent mortgage lender.
12. Prior to making a Mortgage Loan, the nature and amount of such Mortgage
Loan, the circumstances of the relevant Borrower and nature of the
relevant Mortgaged Property satisfied the Lending Criteria in force at
that time in all material respects.
13. The exercise of any discretion by the Seller in the making of any
Mortgage Loan has been consistent with the practice of a reasonable and
prudent mortgage lender.
14. Each Mortgage Loan and its related Mortgage has been made on the terms of
the Standard Mortgage Documentation (so far as applicable) which has not
been varied in any material respect, save for the making of the Base Rate
Pledge.
15. With the exception of agreements for Regulated Personal Secured Loans, no
agreement for any Mortgage Loan (other than to the extent it relates to
the funding of buildings insurance premiums) is or has ever been, wholly
or partly regulated by the Consumer Credit Xxx 0000 (other than by
Sections 137 to 140 of such Act) or constitutes an extortionate credit
bargain under Sections 137 to 140 of such Act or, to the extent it is so
regulated or partly regulated, all the requirements of the Consumer
Credit Act have been met in full. No Mortgage Loan is, or has ever been,
a linked transaction within Section 19 of the Consumer Credit Act.
16. Interest on each Mortgage Loan: (a) is charged on the capital balance of
each Mortgage Loan in accordance with the provisions of that Mortgage
Loan and its related Mortgage; (b) is not in any event adjusted by
reference to the principal amount due thereunder; (c) is payable monthly
in advance; and (d) is calculated by reference to the Standard Variable
Rate or the Bank of England Base Rate, subject to any applicable caps,
discounts and fixed rates and the Base Rate Pledge; and (e) subject to
36
(d) above, may be set by the Seller and its successors and assigns to
that Mortgage Loan.
17. No payment of interest (or in the case of Repayment Mortgage Loans,
principal and interest) equivalent to an amount in excess of one month's
instalment at the applicable rate in respect of a Mortgage Loan in the
Initial Mortgage Portfolio was at any time during the 12 months before
the relevant Closing Date or Assignment Date, as the case may be, in
arrears.
18. So far as the Seller is aware, no Borrower is in material breach of its
Mortgage.
19. So far as the Seller is aware, the underwriting, origination and
completion of each Mortgage Loan is not the subject of fraud by any
person (including, without limitation, the Borrower or any professional
or third party employed or engaged on behalf of the Seller).
20. As at the date of this Agreement, the first payment due has been paid by
the relevant Borrower in respect of each Mortgage Loan and each Mortgage
Loan was fully performing.
21. Where any Borrower is or was entitled to repayment of any early repayment
charge in respect of any mortgage previously held by the Borrower with
the Seller, that repayment has been or will be made by the Seller.
22. Except where a Mortgaged Property was at completion of the relevant
Mortgage (or, where appropriate, in the case of self-build properties, at
the date of completion of the relevant mortgaged property) covered by the
Block Buildings Policy or a block buildings policy providing equivalent
cover, the Seller took all reasonable steps to ensure that at the date of
completion of the relevant Mortgage Loan each Mortgaged Property was:
(a) insured under a buildings policy either (i) in the joint names of
the Borrower and the Seller or (ii) with the interest of the Seller
noted thereon;
(b) insured under a Block Buildings Policy; or
(c) with respect to leasehold properties, insured by the relevant
landlord with the Seller's approval,
and in all cases against risks usually covered by a comprehensive
buildings policy and to an amount not less than the full reinstatement
cost of such Mortgaged Property as determined by an independent valuer or
a valuer employed by the Seller.
23. The Block Buildings Policy referred to above covers such fire and other
commercial risks as would be required by the Seller acting in accordance
with its normal standard for an amount not less than the full
reinstatement value of the Properties covered by the Block Buildings
Policy.
24. The Insurance Contracts are in full force and effect and all premiums
thereon due on or before the date of this Agreement have been paid in
full and the Seller is not aware of any circumstances giving the insurer
under the Insurance Contracts the right to avoid or terminate such policy
in so far as it relates to the Mortgaged Properties or the
37
Mortgage Loans. Where the Lending Criteria then in force required that a
Mortgage Loan was covered by the Insurance Contract referred to in
paragraph 1 of Schedule 4 (Insurance Contracts), that Mortgage Loan is
covered by such Insurance Contract.
25. To the extent that a Guarantee was required under the Lending Criteria in
relation to a particular Mortgage Loan, that Guarantee constitutes the
valid, binding and enforceable obligations of the guarantor thereunder
(save to the extent that any term of the Guarantee is not valid, binding
or enforceable by virtue of the Unfair Terms in Consumer Contracts
Regulations 1994 or the Unfair Terms in Consumer Contracts Regulations
1999).
26. If a Mortgaged Property is leasehold or long leasehold, written notice
has been given to the landlord of the creation of the Mortgage.
27. In relation to each English Mortgage, any person who at the date when the
Mortgage Loan was made has been identified by the Borrower to the Seller
as residing or about to reside in the relevant Mortgaged Property is
either named as a joint Borrower or has signed a form of consent
declaring that he or she agrees that any present or future rights or
interests as he or she may have or acquire over or in respect of the
relevant Mortgaged Property shall be postponed and made subject to the
rights, interests and remedies of the Seller under the relevant Mortgage
and that he or she shall not claim any such rights or interests against
the Seller. In relation to each Scottish Mortgage, all necessary MHA
Documentation has been obtained to as to ensure that neither the relevant
Mortgage nor the relevant Mortgaged Property is subject to or affected by
any statutory right of occupancy.
28. No Borrower was under 18 years of age at the time of completion of the
relevant Mortgage Loan.
29. No Mortgage Loan has a final maturity beyond January 2039 or, following
the redemption in full of all Notes issued by Funding Issuers, January
2044..
30. The Seller has procured that full and proper accounts, books and records
have been kept showing clearly all material transactions, payments,
receipts and proceedings relating to that Mortgage Loan and its Mortgage
and all such accounts, books and records are up to date and in the
possession of the Seller or held to its order (subject to the provisions
of the Mortgages Trust Deed).
31. The origination and collection practices employed by the Seller with
respect to the Mortgage Loans have been, in all respects, legal and
consistent with the practice of a reasonable and prudent mortgage lender.
32. The Seller has not received written notice of any litigation or claim
calling into question in any material way its title to any Mortgage Loan
and its Mortgage or the value of any security. The Seller is not engaged
in any litigation, and no litigation is pending or threatened by the
Seller, against any person in connection with any report, valuation,
opinion, certificate, consent or other statement of fact or opinion given
in connection with any Mortgage Loan received by the Seller in connection
with the origination of any Mortgage Loan.
38
33. In respect of any Mortgaged Property which is subject to a second or
subsequent mortgage or standard security, the Seller has first priority
for the full amount of the Mortgage Loan (other than in respect of a
Regulated Personal Secured Loan) and all costs, fees and expenses
relative thereto.
34. Subject to completion of any registration or recording which may be
pending at the H.M. Land Registry or the Registers of Scotland, all
Property Deeds and Mortgage Loan Files are held by, or to the order of,
the Seller.
35. Each Borrower is a natural person, and no Borrower is at present an
employee or an officer of the Seller.
36. All Mortgage Loans were originated by or on behalf of the Seller in the
ordinary course of the Seller's residential secured lending activities.
No Mortgage Loan was acquired by the Seller subject to any discount and
no Mortgage Loan has been written down by the Seller in its accounts.
37. The Mortgage Loans and their related Mortgages contain no obligations on
the part of the Seller to make any further advances, and all costs, fees
and expenses incurred in making, closing or registering the Mortgage
Loans and the Related Security have been paid in full.
38. All formal approvals, consents and other steps necessary to permit a
legal or equitable or beneficial transfer or a transfer of servicing away
from the Seller of the Mortgage Loans and their related Mortgages to be
sold under this Agreement whenever required under the Transaction
Documents have been obtained or taken and there is no requirement in
order for the transfer to be effective to notify the Borrower before, on
or after any equitable or beneficial transfer or before any legal
transfer of the Mortgage Loans and their related Mortgages.
39. So far as the Seller is aware, none of the terms in any Mortgage Loan and
its related Mortgage are unfair terms within the meaning of the Unfair
Terms in Consumer Contracts Regulations 1994 or the Unfair Terms in
Consumer Contracts Regulations 1999 in any material respect save those
which impose Early Repayment Charges.
40. The Seller has confirmed to all relevant Borrowers that where any
Mortgage Loan provides that where any Early Repayment Charge is payable
at any time when the interest rate payable under that Mortgage Loan is
equal to or set by reference to the Standard Variable Rate (including
without limitation where the Mortgage Loan provides for a capped or
discounted rate), the interest rate payable under that Mortgage Loan will
be no more than 1.99 per cent. above the Bank of England's base rate.
41. In relation to a Right to Buy Mortgage Loan:
(a) in the case of each English Mortgage Loan the Seller was at the time
of origination of that Mortgage Loan an approved lending institution
within the meaning given to that expression in the Housing Xxx 0000;
(b) the original advance was made to the person exercising the right to
buy; and
39
(c) the original advance was made for the purposes of enabling the
recipient thereof to purchase the relevant Mortgaged Property.
For the purpose of this paragraph 41, "Right to Buy Mortgage Loan" means
(i) in relation to an English Mortgage Loan, a Mortgage Loan in respect
of which the "right to buy" provisions of the Housing Xxx 0000 apply
(other than any Mortgage Loan in respect of which the period during which
the statutory charge referred to in section 156 of that Act would have
existed, had the relevant circumstances applied, has expired) and (ii) in
relation to a Scottish Mortgage Loan, a Mortgage Loan in respect of which
the "right to buy" provisions of the Housing (Scotland) Xxx 0000 apply
(other than any Mortgage Loan in respect of which the period during which
the seller's standard security referred to in section 72 of that Act
remains in effect has expired).
42. The loyalty discount applicable to certain Mortgage Loans after seven
years will not apply to any such Mortgage Loans during any period when
the interest rate is fixed.
43. The Seller has paid to the relevant Borrower the full amount of the
cashback payment in relation to any Cashback Mortgage Loan, either upon
completion of the relevant Mortgage Loan or, if subsequent to completion,
prior to the assignment of such Mortgage Loan to the Mortgages Trustee.
44. No Mortgage Loan has a Current Balance of more than (GBP)500,000.
45. Each English Mortgage Loan and its Related Security in the Mortgage
Portfolio was made not earlier than 1 July 1995 and each Scottish
Mortgage Loan and its Related Security in the Mortgage Portfolio was made
not earlier than 1 July 2001.
46. Each Mortgage Loan was originated by the Seller in pounds sterling and is
denominated in pounds sterling (or originated and denominated in euro at
any time when the euro has been adopted as the lawful currency of the
United Kingdom) and is currently repayable in pounds sterling.
47. The Seller's Lending Criteria are consistent with the criteria that would
be used by a reasonable and prudent mortgage lender.
48. The Seller is not aware of any material claim outstanding under any of
the Buildings Policies relating to a Mortgaged Property.
49. No Mortgage Loan has an LTV greater than 95 per cent. In relation to
Personal Secured Loans, the combined LTV of the maximum amount of credit
provided under a Personal Secured Loan and the other Mortgage Loans
secured on the same property is not greater than 95 per cent.
50. Each Mortgage Loan (other than a Personal Secured Loan) has been made for
one of the following purposes:
(a) the purchase of land; or
(b) the provision of dwellings or business premises on any land; or
40
(c) the alteration, enlarging, repair or improvement of a dwelling or
business premises on any land provided that such land is also the subject
of either (i) an agreement by which the relevant Borrower is provided
with credit by the Seller for any of the purposes in (a) or (b) above or
(ii) an agreement refinancing an agreement under which the relevant
Borrower is provided with credit by the Seller for any of the purposes in
(a) or (b) above; or
(d) to refinance any existing indebtedness of the relevant Borrower, whether
to the Seller or another person, under any agreement by which the
relevant Borrower was provided with credit for any of the purposes in
(a), (b) and (c) above.
41
Part 2
1. In respect of each of the Preliminary Prospectus as of its date (except
insofar as the information contained therein has been amended,
supplemented or deleted in the Prospectus) and the Prospectus as at the
date thereof:
(a) each of them contained all information with respect to the Seller,
the Initial Mortgage Portfolio and to the Notes which was material
in the context of the issue and offering of the Notes (including all
information required by English law);
(b) the statements contained in each of them relating to the Seller and
the Initial Mortgage Portfolio were in every material particular
true and accurate and not misleading;
(c) the opinions and intentions expressed in each of them with regard to
the Seller and the Initial Mortgage Portfolio were honestly held,
were reached after considering all relevant circumstances and were
based on reasonable assumptions;
(d) there were no other facts in relation to the Seller, the Initial
Mortgage Portfolio or the Notes the omission of which would, in the
context of the issue and offering of the Notes, make any statement
in either of them misleading; and
(e) all reasonable enquiries had been made by the Seller to ascertain
such facts and to verify the accuracy of all such information and
statements.
2. The Seller has not acquired or owned or possessed any rights in the
Mortgages Trustee or any Funding Beneficiary such that it would "control"
the Mortgages Trustee or any Funding Beneficiary within the meaning of
section 416 ICTA 1988.
There is not any "connection" (within the meaning of section 87 Finance
Act 1996) between either the Mortgages Trustee or any Funding
Beneficiary, respectively, and any Borrower.
42
Part 3
The Seller makes the following representations and warranties to the Mortgages
Trustee, each Funding Beneficiary and each Funding Security Trustee:
1. Status: It is a public limited company duly incorporated, validly
existing and registered under the laws of the jurisdiction in which it is
incorporated, capable of being sued in its own right and not subject to
any immunity from any proceedings, and it has the power to own its
property and assets and to carry on its business as it is being
conducted.
2. Powers and authority: It has the power to enter into, perform and
deliver, and has taken all necessary corporate and other action to
authorise the execution, delivery and performance by it of each of the
Transaction Documents to which it is or will be a party, and each such
Transaction Document has been duly executed and delivered by it.
3. Legal validity: Each Transaction Document to which it is or will be a
party constitutes or when executed in accordance with its terms will
constitute its legal, valid and binding obligation.
4. Non-conflict: The execution by it of each of the Transaction Documents to
which it is a party and the exercise by it of its rights and the
performance of its obligations under such Transaction Documents will not:
(a) result in the existence or imposition of, nor oblige it to create,
any Security Interest in favour of any person over all or any of its
present or future revenues or assets save for any which are created
under or pursuant to the Transaction Documents;
(b) conflict with any document which is binding upon it or any of its
assets;
(c) conflict with its constitutional documents; or
(d) conflict with any law, regulation or official or judicial order of
any government, governmental body or court, domestic or foreign,
having jurisdiction over it.
5. No litigation: It is not a party to any material litigation, arbitration
or administrative proceedings and, to its knowledge, no material
litigation, arbitration or administrative proceedings are pending or
threatened against it.
6. Consents and Licences: All governmental consents, licences and other
approvals and authorisations required by Northern Rock, in its capacity
as Seller, 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.
43
SCHEDULE 2
FORMS OF TRANSFERS: REGISTERED AND UNREGISTERED LAND
AND SCOTTISH TRANSFERS
44
Part 1
FORM OF TRANSFER (REGISTERED LAND - ENGLAND AND WALES)
In the form of H.M. Land Registry Form TR4
45
Part 2
FORM OF TRANSFER (UNREGISTERED LAND - ENGLAND AND WALES)
This Transfer of Mortgages is made on [ ] between NORTHERN ROCK PLC
(registered number 3273685) whose registered office is at Xxxxxxxx Xxxx Xxxxx,
Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (hereinafter called the "Transferor") of
the one part and GRANITE FINANCE TRUSTEES LIMITED (registered number 79309)
whose registered office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX,
Channel Islands (hereinafter called the "Transferee") of the other part.
WHEREAS:
(A) By the charges by way of legal mortgage ("Mortgages") brief particulars
of which are set out in the Annexure hereto the properties brief
particulars of which are similarly set out ("Properties") became security
for the repayment of the moneys therein mentioned.
(B) By a mortgage sale agreement dated 26 March 2001 made between, amongst
others, the Transferor and the Transferee (as amended, restated, varied,
supplemented or novated from time to time), the Transferor has agreed to
sell and the Transferee has agreed to buy all right, title, interest and
benefit (both present and future) in and under the Mortgages for the
consideration hereinafter mentioned.
NOW THIS DEED WITNESSETH as follows:
1. In consideration of the sums payable and the other consideration under
the Agreement by the Transferee (receipt of which is hereby acknowledged)
the Transferor with full title guarantee hereby transfers unto the
Transferee all right, title, interest and benefit (both present and
future) in and under the Mortgages including for the avoidance of doubt:
(i) the right to demand, xxx for, recover, receive and give receipts for
all principal moneys payable or to become payable under the
Mortgages or the unpaid part thereof and the interest due or to
become due thereon; and
(ii) the benefit of all securities for such principal moneys and
interest, the benefit of all consents to mortgage signed by
occupiers of the Properties, and the benefit of and the right to xxx
on all covenants with the Transferor in each Mortgage and the right
to exercise all powers of the Transferor in relation to each
Mortgage; and
(iii) all the estate and interest in the Properties vested in the
Transferor subject to redemption or cesser; and
(iv) all causes of action of the Transferor against any person in
connection with any report, valuation, opinion, certificate or other
statement of fact or opinion or consent to mortgage given in
connection with any Mortgage or affecting the Transferor's decision
to make the relevant advance.
IN WITNESS of which NORTHERN ROCK PLC has caused this Transfer to be executed
and delivered as a deed on the date which appears first above.
46
EXECUTED under THE COMMON SEAL of )
NORTHERN ROCK PLC )
affixed by order of the Board of Directors )
in the presence of: )
---------------------------
Authorised Signatory
Name:
Title:
---------------------------
Authorised Signatory
Name:
Title:
[Alternative methods of executing as a deed will be acceptable if effective]
47
Part 3
FORM OF TRANSFER (LAND REGISTER - SCOTLAND)
We, NORTHERN ROCK PLC, incorporated under the Companies Acts in England
(Registered Number 3273685) and having our Registered Office at Northern Xxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (the Transferor) CONSIDERING THAT
in terms of a Mortgage Sale Agreement among us the Transferor, GRANITE FINANCE
TRUSTEES LIMITED, incorporated under the law of Jersey (Registered Number
79309) and having its Registered Office at 00 Xxxxxxxxx Xxxxxx, Xx Xxxxxx,
Xxxxxx XX0 0XX, Channel Islands (the Transferee) and others dated 26 March
2001 (as amended, restated, varied, supplemented or novated from time to time,
the Mortgage Sale Agreement) we have sold our whole right, title and interest
in and to the Standard Securities and others hereinafter mentioned to the
Transferee NOW THEREFORE we the Transferor IN CONSIDERATION of the sums
payable in terms of and in implement pro tanto of the Mortgage Sale Agreement
HEREBY ASSIGN to the Transferee as trustee under and in terms of the Mortgages
Trust Deed among us, the Transferor, the Transferee and others dated 26 March
2001 (as amended, restated, varied, supplemented or novated from time to time,
the Mortgages Trust Deed) and its successor or successors as trustee or
trustees under and in terms of the Mortgages Trust Deed:
1 the Standard Securities granted by the respective parties whose names are
specified in Column 3 of the Schedule annexed and executed as relative
hereto in favour of us the Transferor for all sums due and to become due,
to the extent of all sums now due and which may at any time or times
hereafter become due under the said Standard Securities, registered said
Standard Securities in the Land Register under the Title Number specified
in the relative entry in Column 4 of the said Schedule on the date
specified in the relative entry in Column 5 of the said Schedule; and
2 the whole rights and interest of us the Transferor in and under all and
any personal bonds, credit agreements or agreements for loan (however
constituted) secured by the said Standard Securities and granted by or
entered into with the said respective parties whose names are specified
in Column 3 of the said Schedule, together with all sums, present and
future, due thereunder and all other rights, interests and benefits
pertaining thereto:
With interest from and also arrears and accumulations of interest due and
unpaid as at [ ]: And we grant warrandice: IN WITNESS WHEREOF these
presents typewritten on this [and the preceding] page are together with the
Schedule annexed hereto executed at [ ] on the [ ] day of
[ ] as follows:
SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC
by ................................... ...................................
and ................................... ...................................
48
Schedule referred to in the foregoing Assignation by
Northern Rock plc
in favour of GRANITE FINANCE TRUSTEES LIMITED
------------- ------------- ---------------- -------------- ------------------
1 2 3 4 5
------------- ------------- ---------------- -------------- ------------------
Account No. Address Borrowers Full Title Number Registration Date
Names
------------- ------------- ---------------- -------------- ------------------
49
Part 4
FORM OF TRANSFER (SASINE REGISTER - SCOTLAND)
We, NORTHERN ROCK PLC, incorporated under the Companies Acts in England
(Registered Number 3273685) and having our Registered Office at Northern Xxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (the Transferor) CONSIDERING THAT
in terms of a Mortgage Sale Agreement among us the Transferor, GRANITE FINANCE
TRUSTEES LIMITED, incorporated under the law of Jersey (Registered Number
79309) and having its Registered Office at 00 Xxxxxxxxx Xxxxxx, Xx Xxxxxx,
Xxxxxx XX0 0XX, Channel Islands (the Transferee) and others dated 26 March
2001 (as amended, restated, varied, supplemented or novated from time to time,
the Mortgage Sale Agreement) we have sold our whole right, title and interest
in and to the Standard Securities and others hereinafter mentioned to the
Transferee NOW THEREFORE we the Transferor IN CONSIDERATION of the sums
payable in terms of and in implement pro tanto of the Mortgage Sale Agreement
HEREBY ASSIGN to the Transferee as trustee under and in terms of the Mortgages
Trust Deed among us the Transferor, the Transferee and others dated 26 March
2001 (as amended, restated, varied, supplemented or novated from time to time,
the Mortgages Trust Deed) and its successor or successors as trustee or
trustees under and in terms of the Mortgages Trust Deed:
1 the Standard Securities granted by the respective parties whose names are
specified in Column 3 of the Schedule annexed and executed as relative
hereto in favour of us the Transferor for all sums due and to become due,
to the extent of all sums now due and which may at any time or times
hereafter become due under the said Standard Securities, recorded said
Standard Securities in the Register for the County specified in the
relative entry in Column 4 of the said Schedule on the date specified in
the relative entry in Column 5 of the said Schedule; and
2 the whole rights and interest of us the Transferor in and under all and
any personal bonds, credit agreements or agreements for loan (however
constituted) secured by the said Standard Securities and granted by or
entered into with the said respective parties whose names are specified
in Column 3 of the said Schedule, together with all sums, present and
future, due thereunder and all other rights, interests and benefits
pertaining thereto:
With interest from and also arrears and accumulations of interest due and
unpaid as at [ ]: And we grant warrandice: IN WITNESS WHEREOF these presents
typewritten on this [and the preceding] page are together with the Schedule
annexed hereto executed at [ ] on the [ ] day of [ ] as follows:
SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC
by ................................... ...................................
and ................................... ...................................
50
Schedule referred to in the foregoing Assignation by
Northern Rock plc
in favour of Granite Finance Trustees Limited
------------- ------------- ---------------- -------------- ------------------
1 2 3 4 5
------------- ------------- ---------------- -------------- ------------------
Account No. Address Borrowers Full County Recording
Names Date
------------- ------------- ---------------- -------------- ------------------
51
SCHEDULE 3
ASSIGNMENT OF INSURANCE CONTRACTS
THIS ASSIGNMENT is made by way of deed on [ ]
BETWEEN
NORTHERN ROCK PLC (registered number 3273685) whose registered office is at
Northern Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX ("Northern Rock");
and
GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel Islands
(the "Mortgages Trustee")
WHEREAS
(A) By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time "Mortgage Sale Agreement") and
made between, amongst others, Northern Rock as Seller and the Mortgages
Trustee, certain mortgages and standard securities (the "Mortgages") and
the loans secured thereby were agreed to be transferred to the Mortgages
Trustee.
(B) Northern Rock has the benefit of the Insurance Contracts, as defined in
the Master Definitions Schedule dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time) which relate to the Mortgages
and the mortgaged properties upon which they are secured (the "Mortgaged
Properties") as well as to certain mortgages and properties in which the
Mortgages Trustee has no interest.
(C) This Assignment is supplemental to the Mortgage Sale Agreement.
NOW THIS DEED WITNESSETH as follows:
In further consideration of the sums and the other consideration referred to
in the Mortgage Sale Agreement, Northern Rock with full title guarantee hereby
assigns unto the Mortgages Trustee absolutely all the estate and interest in
the Insurance Contracts including the rights to receive the proceeds of any
claim to the extent only that such estate, interest, and rights relate to the
Mortgaged Properties and/or the Mortgages, to hold the same unto the Mortgages
Trustee absolutely.
IN WITNESS of which NORTHERN ROCK PLC has caused this Assignment to be
executed and delivered as a Deed or the date which first appears above.
EXECUTED under THE COMMON SEAL of )
NORTHERN ROCK PLC )
affixed by order of the Board of Directors )
in the presence of: )
---------------------------
Authorised Signatory
52
Name:
Title:
---------------------------
Authorised Signatory
Name:
Title:
53
SCHEDULE 4
INSURANCE CONTRACTS
Policy number Insurer Policy name/type Date of Policy
1. NR 9501 Northern Rock Mortgage Mortgage Indemnity 18.07.1996
Indemnity Company Limited
2.(a)BL-HHS AXA General Insurance Supercover Buildings 01.01.1997
Limited and Contents
(b)DR-FHH AXA General Insurance Superchoice Buildings 01.01.1997
Limited and Contents
(c)DR-SGD AXA General Insurance Supercover Gold 01.11.1999
Limited Buildings and Contents
(d)AG112/Z1413248 AXA General Insurance Contingency Insurance 23.04.2003
Limited
(e)AG112/Z1413256 AXA General Insurance Properties in Possession 18.10.1999
Limited
(f)BL-BBR AXA General Insurance Cover Me Buildings and 18.12.2000
Limited Contents
54
SCHEDULE 5
Part 1
ASSIGNMENT OF GUARANTEES
THIS ASSIGNMENT is made by way of deed on [ ]
BETWEEN:
NORTHERN ROCK PLC (registered number 3273685) whose registered office is at
Northern Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX ("Northern Rock");
and
GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel Islands
(the "Mortgages Trustee")
WHEREAS:
(A) By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time the "Mortgage Sale Agreement")
and made between, amongst others, Northern Rock and the Mortgages
Trustee, certain mortgages (the "Mortgages") were agreed to be
transferred and assigned to the Mortgages Trustee.
(B) Northern Rock has the benefit of the Guarantees as defined in the Master
Definitions Agreement dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time) which relate to certain of the
Mortgages.
(C) This Assignment is made pursuant to the Mortgage Sale Agreement.
NOW THIS DEED WITNESSETH as follows:
In further consideration of the sums and the other consideration referred to
in the Mortgage Sale Agreement, Northern Rock with full title guarantee hereby
assigns unto the Mortgages Trustee all its right, title, interest and benefit
(both present and future) in the Guarantees relating to the Mortgages the
subject of a Transfer of even date herewith including for the avoidance of
doubt:
(i) the benefit of and the right to xxx on all covenants with and
undertakings to Northern Rock in each Guarantee and the right to exercise
all powers of Northern Rock in relation to each Guarantee; and
(ii) all the estate and interest in the Guarantees vested in Northern Rock;
to hold the same unto the Mortgages Trustee absolutely.
55
IN WITNESS of which NORTHERN ROCK PLC has caused this Assignment to be
executed and delivered as a deed on the date which first appears above.
EXECUTED under THE COMMON SEAL of )
NORTHERN ROCK PLC )
affixed by order of the Board of Directors )
in the presence of: )
---------------------------
Authorised Signatory
Name:
Title:
---------------------------
Authorised Signatory
Name:
Title:
[Alternative methods of executing as a deed will be acceptable if effective]
56
Part 2
ASSIGNATION OF GUARANTEES
ASSIGNATION
by
NORTHERN ROCK PLC, incorporated in England (Registered Number 3273685) whose
Registered Office is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0
0XX (Northern Rock);
in favour of
GRANITE FINANCE TRUSTEES LIMITED, incorporated in Jersey (Registered Number
79309) whose Registered Office is at 00 Xxxxxxxxx Xxxxxx, Xx Xxxxxx, Xxxxxx
XX0 0XX, Channel Islands (the "Mortgages Trustee")
WHEREAS:
(A) By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time, the "Mortgage Sale Agreement")
and made between, amongst others, Northern Rock and the Mortgages
Trustee, certain mortgage loans and their related security (the
"Mortgages") were agreed to be transferred and assigned to the Mortgages
Trustee;
(B) Northern Rock has the benefit of the Guarantees as defined in the Master
Definitions Agreement dated 26 March 2001 (as amended, varied,
supplemented or novated from time to time) which relate to certain of the
Mortgages;
(C) This Assignation is made pursuant to the Mortgage Sale Agreement;
NOW THEREFORE the parties hereby AGREE as follows:
1 Assignation
Northern Rock hereby assigns to the Mortgages Trustee with absolute
warrandice its whole right, title, benefit and interest, present and
future, in and to the Guarantees governed by Scots law and detailed in
the Schedule hereto (the "Scottish Guarantees") relating to the Mortgages
including for the avoidance of doubt the benefit of and the right to xxx
on all obligations and undertakings to Northern Rock in each Scottish
Guarantee and the right to exercise all powers of Northern Rock in
relation to each Scottish Guarantee.
2 Intimation
Northern Rock hereby undertakes to the Mortgages Trustee that it will,
within fourteen days of the execution of this deed, serve a notice of
assignation by recorded delivery post in such form as the Mortgages
Trustee shall approve upon each of the Guarantors pursuant to each
Scottish Guarantee.
57
3 Governing Law
This deed shall be governed by Scots law and the parties hereto submit to
the non-exclusive jurisdiction of the Scottish courts.
IN WITNESS WHEREOF these presents consisting of this and the preceding page
together with the Schedule annexed hereto are executed as follows:
SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC
at ................................... ...................................
on ................................... ...................................
by ...................................
and ...................................
SUBSCRIBED for and on behalf of the said
GRANITE FINANCE TRUSTEES LIMITED
at ................................... ...................................
on ................................... ...................................
by ...................................
and ...................................
58
Schedule referred to in the foregoing Assignation of
Guarantees by Northern Rock PLC
in favour of Granite Finance Trustees Limited
[Details of Guarantees]
59
SCHEDULE 6
NEW MORTGAGE PORTFOLIO NOTICE
Dated [ ]
1. It is hereby agreed for the purpose of this notice the "Principal
Agreement" shall mean the Mortgage Sale Agreement dated 26 March 2001
made between, amongst others, (1) NORTHERN ROCK PLC (the "Seller") and
(2) GRANITE FINANCE TRUSTEES LIMITED (the "Mortgages Trustee"), as the
same may be amended, varied, supplemented or novated from time to time.
2. Save where the context otherwise requires, words and expressions in this
notice shall have the same meanings respectively as when used in the
Principal Agreement.
3. In accordance with and subject to Clause 4.1 (Agreement to Assign) of the
Principal Agreement, upon receipt by the Seller of the duplicate of this
notice signed by the Mortgages Trustee, there shall exist between the
Seller and the Mortgages Trustee an agreement (the "Agreement for Sale")
for the sale and assignment by the Seller to the Mortgages Trustee of the
New Mortgage Loans and the Related Security more particularly described
in the Schedule hereto (other than any New Mortgage Loans and their
Related Security which have been redeemed in full prior to the next
following Assignment Date). Completion of such sale shall take place,
subject to the provisions of the Principal Agreement, on [ ] (the
"Assignment Date").
4. The Seller hereby confirms that the conditions required to be fulfilled
pursuant to Clause 4.2 (Conditions to Effecting an Assignment of New
Mortgage Loans) of the Principal Agreement have been fulfilled [/save for
conditions ( ) ( ) and ( )]
5. The Agreement for Sale shall incorporate, mutatis mutandis, the relevant
provisions of the Principal Agreement.
Signed for and on behalf of )
NORTHERN ROCK PLC )
by: )
---------------------------
60
[On duplicate
We hereby acknowledge receipt of the New Mortgage Portfolio Notice dated [ ],
and confirm [that the conditions set out in paragraph ( ) ( ) and ( ) of
Clause 4.2 (Conditions to Effecting an Assignment of New Mortgage Loans) have
been waived and] the sale and assignment of the New Mortgage Loans as set out
in that notice.
Signed for and on behalf of )
GRANITE FINANCE TRUSTEES LIMITED )
by: )
---------------------------
61
Schedule
--------------- ----------------- -------------- ------------------
1 2 3 4
--------------- ----------------- -------------- ------------------
Account No. Property Address Name(s) Date of Mortgage
Completion
--------------- ----------------- -------------- ------------------
62
SCHEDULE 7
LOAN REPURCHASE NOTICE
Dated [ ]
1. We refer to the Mortgage Sale Agreement dated 26 March 2001 (as amended,
varied, supplemented or novated from time to time the "Principal
Agreement") made between, amongst others, (1) NORTHERN ROCK PLC (the
"Seller") and (2) GRANITE FINANCE TRUSTEES LIMITED (the "Mortgages
Trustee").
2. Save where the context otherwise requires, words and expressions in this
notice shall have the same meanings respectively as when used in the
Principal Agreement.
3. We hereby send this notice pursuant to and in accordance with Clause [8.4
(Repurchase)/8.5 (Purchase of Product Switches, Further Advances and
purchases relating to Personal Secured Loans)]* of the Principal
Agreement, upon receipt of which you as [the Seller/the Mortgages
Trustee]* will be required to [repurchase from us/re-sell to us/purchase
from us/sell to us]* the Mortgage Loan(s) and Related Security set out in
the attached schedule in accordance with the terms of Clause 8
(Repurchase) of the Principal Agreement on [insert date].
Signed for and on behalf of )
[GRANITE FINANCE TRUSTEES )
LIMITED/NORTHERN ROCK PLC] )
by: )
---------------------------
* Delete as appropriate
63
Schedule
1 2 3 4
Account No. Property Address Name(s) Date of Mortgage
Completion
64
SCHEDULE 8
FORM OF NOTIFICATION TO BORROWERS
[To: Borrower]
Dear Sirs,
Northern Rock
Account No.[ ]
We hereby notify you that on [ ] 2001, Northern Rock agreed to sell
your mortgage to Granite Finance Trustees Limited.
[Additional text will be allowed with the consent of the Mortgages Trustee and
the Funding Security Trustees]
Yours faithfully,
Northern Rock plc
65
SCHEDULE 9
OFFER UNDER CLAUSE 8.6 (REPURCHASE OF FIXED RATE MORTGAGE LOANS)
To: Northern Rock plc
Xxxxxxxx Xxxx Xxxxx
Xxxxxxxx
Xxxxxxxxx xxxx Xxxx
XX0 0XX
From: Granite Finance Trustees Limited
00 Xxxxxxxxx Xxxxxx
Xx Xxxxxx
Xxxxxx
Xxxxxxx Xxxxxxx
XX0 0XX
Date: [ ]
Pursuant to Clause 8.6 (Repurchase of Fixed Rate Mortgage Loans) of the
mortgage sale agreement dated 26 March 2001 made between, amongst others, (1)
Northern Rock plc and (2) Granite Finance Trustees Limited (as amended,
varied, supplemented or novated from time to time the "Agreement") we hereby
offer to re-sell to you the Mortgage Loan(s) together with their Related
Security, details of which are set out in the attached print out, if such
Mortgage Loan(s) become Re-Fixed Mortgage Loans within 3 months of the expiry
of the relevant initial fixed rate periods applicable to that/those Mortgage
Loans. If you wish to do so, please accept this offer by payment to us of the
consideration for the repurchase of the relevant Mortgage Loan(s) and Related
Security in accordance with Clause 8.6 (Repurchase of Fixed Rate Mortgage
Loans) of the Agreement if such Mortgage Loan(s) become Re-Fixed Mortgage
Loans within 3 months of the expiry of the relevant initial fixed rate periods
applicable to that/those Mortgage Loans. Capitalised terms used in this notice
and not defined herein have the meanings given to them in the Agreement.
Signed for and on behalf of )
GRANITE FINANCE TRUSTEES )
LIMITED )
as Seller )
[acting as its attorney NORTHERN ROCK PLC:])
66
SCHEDULE 10
Part 1
POWER OF ATTORNEY IN FAVOUR OF
THE MORTGAGES TRUSTEE, FUNDING AND THE SECURITY TRUSTEE
THIS DEED OF POWER OF ATTORNEY is made on the [o] by:
(1) NORTHERN ROCK PLC whose registered office is at Xxxxxxxx Xxxx Xxxxx,
Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (registered number 3273685) in its
capacity as Seller,
in favour of each of:
(2) GRANITE FINANCE TRUSTEES LIMITED whose registered office is at 00
Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel Islands (registered
number 79309) in its capacity as Mortgages Trustee;
(3) GRANITE FINANCE FUNDING LIMITED, acting out of its branch office
established in England (registered overseas company number FC022999 and
branch number BR005916) at 00 Xxxx Xxxx, Xxxxxxx XX0 0XX and
(4) THE BANK OF NEW YORK a New York Banking Corporation whose London branch
address is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its
capacity as Security Trustee.
WHEREAS:
(A) By virtue of a mortgage sale agreement (the "Mortgage Sale Agreement")
dated 26 March 2001 and as subsequently amended, and made between (1) the
Seller, (2) the Mortgages Trustee (3) Funding and (4) the Security
Trustee, provision was made for the execution by the Seller of this Power
of Attorney.
NOW THIS DEED WITNESSETH:
1. The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx &
Overy LLP on [o] (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.
2. The Seller irrevocably and by way of security for the performance of the
covenants, conditions and undertakings on the part of the Seller
contained in the Mortgage Sale Agreement and the Administration Agreement
HEREBY APPOINTS each of Funding, the Mortgages Trustee and the Security
Trustee (each an "Attorney") and any receiver and/or administrator
appointed from time to time in respect of Funding and/or the Mortgages
Trustee or their assets severally to be its true and lawful attorney for
the Seller and in the Seller's name or otherwise to do any act, matter or
thing which any Attorney considers necessary for the protection or
preservation of
67
that Attorney's interest in the Mortgage Loans, the Mortgages, the
Mortgage Deeds and their Related Security or which ought to be done under
the covenants, undertakings and provisions contained in the Mortgage Sale
Agreement including (without limitation) any or all of the following that
is to say:
(a) to exercise its rights, powers and discretions under the Mortgage
Loans, the Mortgages, the Mortgage Deeds and the Related Security
including the right to fix the rate or rates of interest payable
under the Mortgage Loans in accordance with the terms thereof
(including whilst such Mortgage Loans subsist and subject to the
consent of the Mortgages Trustee being given to the setting of such
rates), setting the Standard Variable Rate of the Seller, such other
discretionary rates and margins applicable to the Mortgage Loans and
(other than in respect of the Security Trustee) the rate of (and
terms relating to) the Existing Borrowers' Re-Fix Rate in the
circumstances referred to in Clause 4 (Interest Rates) of the
Administration Agreement provided that nothing in this Clause shall
prevent the Seller (or any of its attorneys from time to time) from
setting higher rates (and in the case of the Existing Borrowers'
Re-Fix Rate, imposing terms more advantageous to the Mortgages
Trustee) than those set or to be set or required or to be required
by the Mortgages Trustee or Funding under this power of attorney;
(b) to exercise all the powers exercisable by the Seller by reason of
its remaining for the time being the registered owner at H.M. Land
Registry or registered or recorded heritable creditor in the
Registers of Scotland of any of the Mortgage Loans, the Mortgages,
the Mortgage Deeds and the Related Security and in particular, but
without prejudice to the generality of the foregoing, to make
Further Advances to Borrowers;
(c) to demand, xxx for and receive all moneys due or payable under the
Mortgage Loans, the Mortgages, the Mortgage Deeds and the Related
Security or any such collateral security or related rights;
(d) to execute, sign, seal and deliver (using the company seal of the
Seller where appropriate) a conveyance, assignation or transfer of
the Mortgage Loans, the Mortgages, the Mortgage Deeds and the
Related Security or any of them to the Mortgages Trustee and its
successors in title or other person or persons entitled to the
benefit thereof;
(e) to execute, sign, seal and deliver (using the company seal of the
Seller where appropriate) a conveyance, assignment, assignation or
transfer of the Related Security or any item comprised therein (to
the extent only that such item or items relate to the Mortgage
Loans) to the Mortgages Trustee and its successors in title or other
person or persons entitled to the benefit thereof or entitled to be
registered or recorded at H.M. Land Registry or the Registers of
Scotland as proprietor or heritable creditor thereof (as the case
may be);
(f) to discharge the Mortgages or the Related Security or any of them
and to sign, seal, deliver and execute such receipts, releases,
surrenders, instruments and deeds as may be required or advisable in
order to discharge the relevant Mortgaged Property or Properties
from the Mortgages or any of them; and
68
(g) to do every other act or thing which the Seller is obliged to do
under the Mortgage Sale Agreement or which that Attorney may
otherwise consider to be necessary proper or expedient for fully and
effectually vesting or transferring the interests sold thereunder in
the Mortgage Loans, the Mortgages, the Mortgage Deeds and their
Related Security or any or each of them and/or the Seller's estate
right and title therein or thereto in the Mortgages Trustee and its
successors in title or other person or persons entitled to the
benefit thereof (as the case may be) in the same manner and as fully
and effectually in all respects as the Seller could have done.
3. Each Attorney shall have the power by writing under its hand by an
officer of the Attorney from time to time to appoint a substitute who
shall have power to act on behalf of the Seller as if that substitute
shall have been originally appointed Attorney by this deed (including,
without limitation, the power of further substitution) and/or to revoke
any such appointment at any time without assigning any reason therefor.
4. The laws of England shall apply to this deed and the interpretation
thereof and to all acts of the Attorney carried out or purported to be
carried out under the terms hereof.
5. The Seller hereby agrees at all times hereafter to ratify and confirm
whatsoever the said Attorney or its attorneys shall lawfully do or cause
to be done in and concerning the Mortgage Loans, the Mortgages or the
Mortgage Deeds or their Related Security by virtue of this deed.
IN WITNESS whereof the Seller has executed this document as a deed the day and
year first before written.
69
EXECUTED under THE COMMON SEAL of )
NORTHERN ROCK PLC )
affixed in the presence of: )
-------------------------------
Authorised Signatory
Name:
Title:
-------------------------------
Authorised Signatory
Name:
Title:
70
SCHEDULE 10
Part 2
POWER OF ATTORNEY IN FAVOUR OF
THE MORTGAGES TRUSTEE, EACH FUNDING BENEFICIARY AND EACH
FUNDING SECURITY TRUSTEE
THIS DEED OF POWER OF ATTORNEY is made on the [o] by:
(1) NORTHERN ROCK PLC whose registered office is at Xxxxxxxx Xxxx Xxxxx,
Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (registered number 3273685) in its
capacity as Seller,
in favour of each of:
(2) GRANITE FINANCE TRUSTEES LIMITED whose registered office is at 00
Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel Islands (registered
number 79309) in its capacity as Mortgages Trustee;
(3) GRANITE FINANCE FUNDING LIMITED, acting out of its branch office
established in England (registered overseas company number FC022999 and
branch number BR005916) at 00 Xxxx Xxxx, Xxxxxxx XX0 0XX
(4) GRANITE FINANCE FUNDING 2 LIMITED whose registered office is at Xxxxx
Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX; and
(5) THE BANK OF NEW YORK a New York Banking Corporation whose London branch
address is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its
capacities as Security Trustee and as Funding 2 Security Trustee.
WHEREAS:
(A) By virtue of a mortgage sale agreement (the "Mortgage Sale Agreement")
dated 26 March 2001 and made between (1) the Seller, (2) the Mortgages
Trustee (3) Funding and (4) the Security Trustee and as subsequently
amended, provision was made for the execution by the Seller of this Power
of Attorney.
(B) NOW THIS DEED WITNESSETH:
1. The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx &
Overy LLP on [o] (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.
2. The Seller irrevocably and by way of security for the performance of the
covenants, conditions and undertakings on the part of the Seller
contained in the Mortgage Sale Agreement and the Administration Agreement
HEREBY APPOINTS each of Funding, Funding 2, the Mortgages Trustee, the
Security Trustee and the Funding 2 Security Trustee (each an "Attorney")
and any receiver and/or administrator appointed from time to time in
respect of Funding, Funding 2 and/or the Mortgages
71
Trustee or their assets severally to be its true and lawful attorney for
the Seller and in the Seller's name or otherwise to do any act, matter or
thing which any Attorney considers necessary for the protection or
preservation of that Attorney's interest in the Mortgage Loans, the
Mortgages, the Mortgage Deeds and their Related Security or which ought
to be done under the covenants, undertakings and provisions contained in
the Mortgage Sale Agreement including (without limitation) any or all of
the following that is to say:
(a) to exercise its rights, powers and discretions under the Mortgage
Loans, the Mortgages, the Mortgage Deeds and the Related Security
including the right to fix the rate or rates of interest payable
under the Mortgage Loans in accordance with the terms thereof
(including whilst such Mortgage Loans subsist and subject to the
consent of the Mortgages Trustee being given to the setting of such
rates), setting the Standard Variable Rate of the Seller, such other
discretionary rates and margins applicable to the Mortgage Loans and
(other than in respect of the Funding Security Trustees) the rate of
(and terms relating to) the Existing Borrowers' Re-Fix Rate in the
circumstances referred to in Clause 4 (Interest Rates) of the
Administration Agreement provided that nothing in this Clause shall
prevent the Seller (or any of its attorneys from time to time) from
setting higher rates (and in the case of the Existing Borrowers'
Re-Fix Rate, imposing terms more advantageous to the Mortgages
Trustee) than those set or to be set or required or to be required
by the Mortgages Trustee, Funding or Funding 2 under this power of
attorney;
(b) to exercise all the powers exercisable by the Seller by reason of
its remaining for the time being the registered owner at H.M. Land
Registry or registered or recorded heritable creditor in the
Registers of Scotland of any of the Mortgage Loans, the Mortgages,
the Mortgage Deeds and the Related Security and in particular, but
without prejudice to the generality of the foregoing, to make
Further Advances to Borrowers;
(c) to demand, xxx for and receive all moneys due or payable under the
Mortgage Loans, the Mortgages, the Mortgage Deeds and the Related
Security or any such collateral security or related rights;
(d) to execute, sign, seal and deliver (using the company seal of the
Seller where appropriate) a conveyance, assignation or transfer of
the Mortgage Loans, the Mortgages, the Mortgage Deeds and the
Related Security or any of them to the Mortgages Trustee and its
successors in title or other person or persons entitled to the
benefit thereof;
(e) to execute, sign, seal and deliver (using the company seal of the
Seller where appropriate) a conveyance, assignment, assignation or
transfer of the Related Security or any item comprised therein (to
the extent only that such item or items relate to the Mortgage
Loans) to the Mortgages Trustee and its successors in title or other
person or persons entitled to the benefit thereof or entitled to be
registered or recorded at H.M. Land Registry or the Registers of
Scotland as proprietor or heritable creditor thereof (as the case
may be);
(f) to discharge the Mortgages or the Related Security or any of them
and to sign, seal, deliver and execute such receipts, releases,
surrenders, instruments and
72
deeds as may be required or advisable in order to discharge the
relevant Mortgaged Property or Properties from the Mortgages or any
of them; and
(g) to do every other act or thing which the Seller is obliged to do
under the Mortgage Sale Agreement or which that Attorney may
otherwise consider to be necessary proper or expedient for fully and
effectually vesting or transferring the interests sold thereunder in
the Mortgage Loans, the Mortgages, the Mortgage Deeds and their
Related Security or any or each of them and/or the Seller's estate
right and title therein or thereto in the Mortgages Trustee and its
successors in title or other person or persons entitled to the
benefit thereof (as the case may be) in the same manner and as fully
and effectually in all respects as the Seller could have done.
3. Each Attorney shall have the power by writing under its hand by an
officer of the Attorney from time to time to appoint a substitute who
shall have power to act on behalf of the Seller as if that substitute
shall have been originally appointed Attorney by this deed (including,
without limitation, the power of further substitution) and/or to revoke
any such appointment at any time without assigning any reason therefor.
4. The laws of England shall apply to this deed and the interpretation
thereof and to all acts of the Attorney carried out or purported to be
carried out under the terms hereof.
5. The Seller hereby agrees at all times hereafter to ratify and confirm
whatsoever the said Attorney or its attorneys shall lawfully do or cause
to be done in and concerning the Mortgage Loans, the Mortgages or the
Mortgage Deeds or their Related Security by virtue of this deed.
IN WITNESS whereof the Seller has executed this document as a deed the day
and year first before written.
EXECUTED under THE COMMON SEAL of )
NORTHERN ROCK PLC )
affixed in the presence of: )
---------------------------
Authorised Signatory
Name:
Title:
---------------------------
Authorised Signatory
Name:
Title:
73
SCHEDULE 11
FORM OF SCOTTISH TRUST DEED
DECLARATION OF TRUST
among
NORTHERN ROCK PLC, incorporated under the Companies Acts in England
(registered number 3273685), having its registered office at Northern Xxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (in its capacity as seller of the
Mortgage Loans, the "Seller" and, in its capacity as a beneficiary of the
Mortgages Trust, the "Seller Beneficiary");
GRANITE FINANCE TRUSTEES LIMITED, incorporated under the laws of Jersey
(registered number 79309), and having its registered office at 00 Xxxxxxxxx
Xxxxxx, Xx. Xxxxxx, Xxxxxx, XX0 0XX, Channel Islands (the "Mortgages
Trustee");
GRANITE FINANCE FUNDING LIMITED, incorporated under the laws of Jersey
(registered number 79308), but acting out of its branch office established in
England (registered overseas company number FC022999 and branch number
BR005916) at 00 Xxxx Xxxx, Xxxxxxx XX0 0XX ("Funding"); and
GRANITE FINANCE FUNDING 2 LIMITED, incorporated under the laws of England and
Wales (registered number 5249387) and having its registered office at Xxxxx
Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX ("Funding 2" and, together with
Funding, each in its capacity as a beneficiary of the Mortgages Trust, the
"Funding Beneficiaries" and, together with the Seller Beneficiary, the
"Beneficiaries" and each a "Beneficiary").
WHEREAS:
(A) Title to the Scottish Trust Property referred to below is held by and
vested in the Seller;
(B) In terms of the Mortgages Trust Deed entered into among the Seller,
Funding and the Mortgages Trustee dated 26 March 2001 (as amended,
restated, varied, supplemented or novated from time to time, the
"Mortgages Trust Deed") and the Mortgages Trust constituted in terms
thereof the Mortgages Trustee holds the Trust Property on trust for the
Beneficiaries;
(C) In terms of the Mortgage Sale Agreement entered into among the Seller,
the Mortgages Trustee, Funding and the Security Trustee dated 26 March
2001 (as amended, restated, varied, supplemented or novated from time to
time, the "Mortgage Sale Agreement") the Seller has agreed to sell and
assign the Scottish Trust Property to the Mortgages Trustee to be held
thereafter by the Mortgages Trustee under and in terms of the Mortgages
Trust; and
(D) In implementation of Clause 4.4 of the Mortgage Sale Agreement and
pending the taking of legal title to the Scottish Trust Property by the
Mortgages Trustee, the Seller has undertaken to grant this deed;
74
NOW THEREFORE the parties HEREBY AGREE and DECLARE as follows:
1 Interpretation
In this deed:-
1.1 The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx &
Overy LLP on [o], 2005 (as the same have been and may be amended, varied
or supplemented from time to time with the consent of the parties hereto)
are expressly and specifically incorporated into and shall apply to this
deed, including the recitals hereto; and
1.2 "Scottish Trust Property" shall mean the Scottish Mortgage Loans and the
Scottish Mortgages and other Related Security relative thereto brief
particulars of which are detailed in the schedule annexed and executed as
relative hereto, together with:
a) all principal sums (including all Further Advances, Further Draws
and Re-Draws), interest and expenses, present or future, comprised
therein and secured thereby and the right to demand, recover,
receive and give receipts for the same;
b) the Seller's whole right and interest in the Mortgaged Properties
secured by the said Scottish Mortgages;
c) all rights of action of the Seller against any person in connection
with any report, valuation, opinion, certificate, consent or other
statement of fact or opinion given in connection with any of the
said Scottish Mortgage Loans and their Related Security;
d) all powers and remedies for enforcing the said Scottish Mortgage
Loans and their Related Security and all proceeds resulting
therefrom; and
e) all other monies, rights, interests, benefits and others pertaining
thereto or deriving therefrom, including the benefit and proceeds of
any insurance policy pertaining thereto.
2 Declaration of Trust
The Seller hereby DECLARES that from and after the date hereof it holds
and, subject to Clause 9 (Termination of Trust) hereof, shall henceforth
hold the Scottish Trust Property and its whole rights, title, benefit and
interest, present and future, therein and thereto in trust absolutely for
the Mortgages Trustee and its assignees (whether absolutely or in
security) whomsoever.
3 Intimation
The Seller hereby intimates to the Mortgages Trustee the coming into
effect of the trust hereby declared and created and the Mortgages Trustee
by its execution hereof immediately subsequent to the execution of this
Deed by the Seller acknowledges such intimation.
4 Dealings with Trust Property and Negative Pledge
75
The Seller warrants and undertakes to the Mortgages Trustee that:
4.1 as at the date hereof, it holds (subject to any pending registration
or recording in the Registers of Scotland) legal title to the
Scottish Trust Property unencumbered by any fixed or floating charge
or other Security Interest;
4.2 it shall not create or agree to create any fixed or floating charge
or other Security Interest over or which may attach to or affect the
whole or any part of the Scottish Trust Property or otherwise
dispose of the same at any time when such property or part thereof
remains subject to the trust hereby created; and
4.3 it shall deal with the Scottish Trust Property (including without
limitation the calculation and setting of any interest rate
applicable thereto) in accordance with the provisions of the
Transaction Documents and the specific written instructions (if any)
of the Mortgages Trustee or its foresaids and shall take, subject to
Clause 9 (Termination of Trust) hereof, any such action as may be
necessary (including without limitation the raising or defending of
any proceedings in any court of law whether in Scotland or
elsewhere) to secure or protect the title to the Scottish Trust
Property but only in accordance with the specific written
instructions (if any) of the Mortgages Trustee or its foresaids.
5 Change of Trustee
Except with the prior written consent of the Mortgages Trustee or its
foresaids and (for so long as each retains any right or interest in the
Scottish Trust Property) the Funding Beneficiaries and the Funding
Security Trustees, the Seller shall not be entitled to resign office as a
trustee or assume a new trustee or trustees under this Deed.
6 Power of Beneficiary
6.1 The Mortgages Trustee, as beneficiary hereunder, shall have the
right in the circumstances stated in Clause 6 (Perfection of the
Assignment) of the Mortgage Sale Agreement to complete its title to
the Scottish Trust Property or any part thereof or to call upon the
Seller to execute and deliver to the Mortgages Trustee or its
foresaids valid assignations and transfers (including where
applicable Scottish Transfers) of the Scottish Trust Property or any
part thereof, and that notwithstanding the winding-up of the Seller
or the administration of the Seller, or the appointment of any
receiver to all or any part of the Scottish Trust Property.
6.2 Without prejudice to the generality of Clause 6.1, the Seller
undertakes to the Mortgages Trustee and binds and obliges itself
that, upon the occurrence of any one of the events specified in
Clause 6.1(a) to (f) of the Mortgage Sale Agreement, it will within
five London Business Days of such occurrence provide such
information as is necessary to enable the Mortgages Trustee to
complete Scottish Transfers (including all schedules and annexures
thereto) in relation to the whole of the Scottish Mortgages
comprised within the Scottish Trust Property.
76
6.3 For further assuring the said rights and powers specified in this
Clause 6, the Seller has granted a power of attorney in favour of
the Mortgages Trustee, each Funding Beneficiary and each Funding
Security Trustee substantially in the form set out in Schedule 10 to
the Mortgage Sale Agreement.
7 Mortgages Trustee Declaration of Trust
7.1 The Mortgages Trustee by its said execution of this Deed hereby
DECLARES that its whole right, title and beneficial interest in and
to the Scottish Trust Property in terms of this Deed are and shall
be held (to the extent not already so held) by the Mortgages Trustee
under and in terms of the Mortgages Trust and all monies received or
held by the Mortgages Trustee relating thereto or deriving therefrom
have been and shall be comprised in the Trust Property as defined in
the Mortgages Trust Deed and shall be subject to and administered by
the whole terms and conditions of the Mortgages Trust Deed and the
Administration Agreement.
7.2 Each of the Seller and the Beneficiaries hereby acknowledge, accept
and agree to the declaration constituted by and the whole other
terms and conditions of the foregoing Clause 7.1.
8 Mortgages Trust Intimation
The Mortgages Trustee hereby intimates to the Beneficiaries of the
Mortgages Trust, the declaration of trust made in terms of Clause 7
(Mortgages Trustee Declaration of Trust) hereof and the Beneficiaries of
the Mortgages Trust by their respective executions of this Deed
acknowledge such intimation.
9 Termination of Trust
If at any time during the subsistence of the trust hereby declared and
created:
9.1 full legal title to any part or parts of the Scottish Trust Property
is taken by the Mortgages Trustee or its foresaids in accordance
with the provisions of Clause 6 (Perfection of the Assignment) of
the Mortgage Sale Agreement (which in the case of any Scottish
Mortgage shall be constituted by the registration or recording of
the title thereto in the Registers of Scotland); or
9.2 any Scottish Mortgage Loan and Related Security comprised within the
Scottish Trust Property has been repurchased by the Seller pursuant
to Clauses 8.4 to 8.6 (inclusive) of the Mortgage Sale Agreement; or
9.3 any such Scottish Mortgage Loan and Related Security has been
redeemed in full and therefore no longer forms part of the Mortgage
Portfolio; then
the trust hereby declared and created shall (but only when the relevant
events or transaction have been completed irrevocably, validly and full)
ipso facto fall and cease to be of effect in respect of such part or
parts of the Scottish Trust Property but shall continue in full force and
effect in respect of the whole remainder (if any) of the Scottish Trust
Property.
10 Variation
77
This Deed and the trust hereby declared and created shall not be varied
in any respect without the consent in writing of the Mortgages Trustee or
its foresaids and (for so long as each retains any right or interest in
the Scottish Trust Property) each Funding Beneficiary and each Funding
Security Trustee.
11 Governing Law
11.1 This Deed shall be governed by, and construed in accordance with,
Scots law, other than Clause 7 (Mortgages Trustee Declaration of
Trust) hereof which shall be governed by, and construed in
accordance with, English law.
11.2 The parties hereto submit to the non-exclusive jurisdiction of the
Scottish courts so far as not already subject thereto and waive any
right or plea of forum non conveniens in respect of such
jurisdiction.
12 Registration
The parties consent to the registration of this deed for preservation.
IN WITNESS WHEREOF these presents consisting of this and the preceding [four]
pages together with the Schedule hereto are subscribed by the Seller, the
Mortgages Trustee, Funding and Funding 2 as follows:
As Seller and as Seller Beneficiary:
SUBSCRIBED by
NORTHERN ROCK PLC
acting by:
.......................... Director ......................... Director
(Print Full Name) (Signature)
.......................... Director/ ......................... Director/
(Print Full Name) Secretary (Signature) Secretary
all together at
on
78
As Mortgages Trustee:
SUBSCRIBED by
GRANITE FINANCE TRUSTEES LIMITED
acting by:
.......................... Director ......................... Director
(Print Full Name) (Signature)
.......................... Director/ ......................... Director/
(Print Full Name) Secretary (Signature) Secretary
all together at
on
As Funding and as a Funding Beneficiary:
SUBSCRIBED by
GRANITE FINANCE FUNDING LIMITED
acting by:
.......................... Director ......................... Director
(Print Full Name) (Signature)
.......................... Director/ ......................... Director/
(Print Full Name) Secretary (Signature) Secretary
all together at
on
As Funding 2 and as a Funding Beneficiary:
SUBSCRIBED by
GRANITE FINANCE FUNDING 2 LIMITED
acting by:
.......................... Director ......................... Director
(Print Full Name) (Signature)
.......................... Director/ ......................... Director/
(Print Full Name) Secretary (Signature) Secretary
79
This is the Schedule to the foregoing Scottish Trust Deed between Northern
Rock PLC, Granite Finance Trustees Limited, Granite Finance Funding Limited
and Granite Finance Funding 2 Limited
Scottish Mortgage Loans and Related Security
1 2 3 4
Account No. Property Address Name(s) Date of Mortgage
Completion
80
SCHEDULE 12
LENDING CRITERIA /1/
General
To proceed with obtaining a Mortgage Loan, each prospective Borrower completes
an application form which includes information with respect to the applicant's
income from all sources, current employment details, bank account information
(where the Borrower has a bank account), current mortgage information (if
applicable) and certain other personal information. A credit reference agency
search is made against each Borrower at their current address and, if
necessary, former addresses, in all cases which will give details of any
public information which includes county court judgements and details of any
bankruptcy.
Employment details
The Seller operates the following policy in respect of the verification of
Borrower income details. Under this policy, Borrowers are categorised as
either "employed" or "self-employed" by the Seller.
Proof of income for employed prospective Borrowers applying for Mortgage Loans
in an amount less than (GBP)500,000 may be established by:
(a) the last three monthly bank statements and/or three monthly payslips from
the six month period prior to the application; or
(b) Form P60 or accountant's certificate certifying the Borrower's income.
Proof of income for self-employed prospective Borrowers may be established by:
(a) a letter from the Borrower's accountant in acceptable form; or
(b) acceptable confirmation of self-employment which might include any of a
tax return, accountant's letter or a trade invoice, together with a
certificate from the Borrower as to income.
For certain Mortgage Loan products, particularly those that may involve larger
maximum loan amounts or higher loan to value ("LTV") ratios, the Seller
generally will require an acceptable accountant's letter or audited accounts.
Income Capacity
The following maximum income multiples are applied in determining the amount
of the Mortgage Loan:
(a) Single applicant- 3.50 times gross income for all Mortgage Loans (other
than Together Mortgage Loans); 3.80 times gross income for Together
Mortgage Loans.
(b) Joint applicants - a sum equal to: (1) the higher of 2.75 times the joint
gross income of the applicants (3.00 times joint gross income for
Together Mortgage Loans), or 3.50
-------------------------
/1/ These Lending Criteria apply to Mortgage Loans other than Personal Secured
Loans.
81
times the highest earning applicant's gross income (3.80 times the
highest joint gross income for Together Mortgage Loans) plus (2) the
gross income of the other applicant.
Valuation
The Seller requires that a valuation of the Mortgaged Property be obtained
either from its in-house valuation department or from an independent firm of
professional valuers selected from a panel of approved valuers. Details of
professional indemnity insurance held by panel valuers are kept by the Seller.
All valuations of Properties are reviewed by the person underwriting the
Mortgage Loan and/or the valuation team.
Property Types
The Seller applies the criteria set out below in determining the eligibility
of Properties to serve as security for Mortgage Loans. Under these criteria,
eligible property types include freehold, heritable and leasehold houses,
leasehold and heritable flats and mixed commercial and residential use
properties where there is a separate entrance for the residential part of the
Mortgaged Property. In the case of a Mortgage Loan secured by a leasehold
property, the Seller requires that the unexpired term of the lease be at least
30 years from the end of the agreed mortgage term, with a minimum remaining
term of 50 years from the beginning of the mortgage term.
Certain property types falling outside the criteria may be considered on a
case by case basis. However, certain property types will not be considered for
the purposes of providing security for a Mortgage Loan. The types of property
falling within this category comprise freehold flats (in England and Wales),
shared ownership or shared equity schemes and properties of non-standard
construction of a type considered to be defective.
Loan Amount
Generally, the maximum loan amount is (GBP)1,000,000, but this varies
according to the application in question. In exceptional cases, this limit may
be exceeded.
Term
Each Mortgage Loan must have an initial term of between 7 and 30 years (in the
case of a Together Mortgage Loan, a Together Connections Mortgage Loan and a
Connections Mortgage Loan) or between 7 and 35 years in the case of all other
Mortgage Loans.
Age of applicant
All Borrowers in respect of non-Together Mortgage Loans must be aged 18 or
over. The first named Borrower in respect of Together Mortgage Loans must be
aged 21 or over. There are no maximum age limits.
Discretion to lend outside Lending Criteria
On a case-by-case basis, and within approved limits as detailed in the
Seller's lending policy, the Seller may have determined that, based upon
compensating factors, a prospective Borrower who did not strictly qualify
under its lending criteria warranted an underwriting
82
exception. Compensating factors may include, but are not limited to, a low LTV
ratio, stable employment and time in residence at the applicant's current
residence.
Maximum Loan To Value
For a Mortgage Loan secured by a Mortgaged Property valued up to (GBP)250,000,
the maximum LTV ratio permitted is 95 per cent. of the lower of the purchase
price and the current market value of the Mortgaged Property determined by the
valuation. For a Mortgage Loan secured by a Mortgaged Property valued up to
(GBP)1,000,000 the maximum LTV ratio permitted is 90 per cent. of the lower of
the purchase price and the current market value of the Mortgaged Property
determined by relevant valuation. For a Mortgage Loan secured by a Mortgaged
Property valued over (GBP)1,000,000 the maximum LTV ratio permitted is 85 per
cent. of the lower of the purchase price and the current market value of the
Mortgaged Property determined by valuation.
83
SCHEDULE 13
STANDARD DOCUMENTATION
Doc No. Document Period in Use
1. (a) NRBS Mortgage Offer - General Conditions 01/07/95 to 31/12/95
(b)NRBS Mortgage Offer - General Conditions 01/01/96 to 30/11/96
(c)NRBS Mortgage Offer - General Conditions 01/12/96 to 30/09/97
2. NRBS Mortgage Deed 01/07/95 to 30/09/97
3. NRBS Mortgage Conditions Booklet 1995 01/07/95 to 30/09/97
4. (a)NR plc Mortgage Offer - General Conditions 01/10/97 to 31/12/97
(b)NR plc Mortgage Offer - General Conditions 01/12/97 to 31/12/97
(c)NR plc Mortgage Offer - General Conditions 01/01/98 to 31/05/98
(d)NR plc Mortgage Offer - General Conditions 01/06/98 to 31/12/98
(e)NR plc Mortgage Offer - General Conditions 01/01/99 to present
5. NRBS/NR plc Transitional Mortgage Deed 01/07/97 to 01/10/97
6. NR plc Mortgage Deed 01/10/97 to present
7. NR plc Mortgage Conditions 1997 01/10/97 to present
8. NR plc "Together" Mortgage Deed 01/04/99 to present
9. Discounted Mortgage Brochures
10. Discounted Mortgage Special Conditions
11. Cashback Mortgage Brochures
12. Cashback Mortgage Special Conditions
13. Fixed Rate Mortgage Brochures
14. Fixed Rate Mortgage Special Conditions
15. Together Mortgage Brochures
16. Together Mortgage Special Conditions
84
APPENDIX A
THE INITIAL MORTGAGE LOAN PORTFOLIO
Account No Property Name of Date of Current
Address Borrower(s) Mortgage Balance
Completion
85
Definitions (to be incorporated into a revised Master Definitions Schedule)
"Bullet Redemption Notes" means, in relation to a Funding 2 Issuer, any Series
and Class of Notes issued by such Issuer which is scheduled to be repaid in
full on one Payment Date. Such Bullet Redemption Notes will be deemed to be
Pass-Through Notes if:
(a) a date specified in relation to the same in the applicable Note
Supplement occurs;
(b) a Trigger Event occurs;
(c) a Note Acceleration Notice is served in respect of such Notes; or
(d) the Step-Up Date (if any) in relation to such Notes occurs;
"Controlled Amortisation Notes" means, in relation to a Funding 2 Issuer, any
Series and Class of Notes issued by such Issuer, the conditions of which
impose a limit on the amount of principal which may be repaid on such Notes on
each Payment Date. Such Controlled Amortisation Notes will be deemed to be
pass-through notes if:
(a) a date specified in relation to the same in the applicable Note
Supplement occurs;
(b) a Trigger Event occurs;
(c) a Note Acceleration Notice is served in respect of such Notes; or
(d) the Step-Up Date (if any) in relation to such Notes occurs;
"Controlled Redemption Dates" means, for any Series and Class of Controlled
Amortisation Notes, the Payment Date specified as such for such Series and
Class of Notes in the applicable Note Supplement;
"Deferred Contribution" means:
(a) the consideration in the form of cash payable by Funding to the Mortgages
Trustee from time to time in respect of the Funding Share of the Trust
Property pursuant to and in accordance with the Mortgages Trust Deed
and/or the Funding Deed of Charge including, for the avoidance of doubt,
the Funding Final Deferred Contribution; and
(b) the consideration in the form of cash payable by Funding 2 to the
Mortgages Trustee from time to time in respect of the Funding 2 Share of
the Trust Property pursuant to and in accordance with the Mortgages Trust
Deed and/or the Funding 2 Deed of Charge including, for the avoidance of
doubt, the Funding 2 Final Deferred Contribution,
which Contributions will fund the payment to the Seller by the Mortgages
Trustee of amounts of Deferred Purchase Price payable by the Mortgages Trustee
to the Seller from time to time pursuant to and in accordance with the
Mortgage Sale Agreement;
"Event of Default" means, as the context requires, a Funding Event of Default
and/or a Funding 2 Event of Default;
86
"Funding Beneficiaries" means Funding and Funding 2, as beneficiaries of the
Mortgages Trust and "Funding Beneficiary" means either of them;
"Funding Event of Default" means, as the context requires, any of the
following:
(a) in relation to the Notes issued by any Funding Issuer, the occurrence of
a Note Event of Default pursuant to the Terms and Conditions of such
Notes;
(b) in relation to any Funding Intercompany Loan Agreement, the occurrence of
a Funding Intercompany Loan Event of Default;
"Funding Final Deferred Contribution" has the meaning given such term in
Clause [4.2(d)] of the Mortgages Trust Deed
"Funding Intercompany Loan" means a loan (or the aggregate of a number of
separate loans) of the net proceeds of any issue (or all issues) of Notes by a
Funding Issuer, such loan(s) being advanced to Funding by such Funding Issuer
pursuant to the terms of a Funding Intercompany Loan Agreement;
"Funding Intercompany Loan Agreement" means an intercompany loan agreement
entered into between Funding and a Funding Issuer in relation to a Funding
Intercompany Loan;
"Funding Intercompany Loan Event of Default" means the occurrence of an event
of default as specified in Clause 14 (Default) of the Intercompany Loan Terms
and Conditions;
"Funding Issuer" means a wholly-owned subsidiary of Funding, which is
established to issue Notes and to make a Funding Intercompany Loan to Funding;
"Funding Relevant Distribution" has the meaning given such term in Clause
[4.2(b)] of the Mortgages Trust Deed;
"Funding Security Trustees" means the Security Trustee and the Funding 2
Security Trustee and "Funding Security Trustee" means either of them;
"Funding 2 Available Revenue Receipts" in respect of any Payment Date will be
calculated by the Cash Manager on the Distribution Date immediately preceding
such Payment Date and will be an amount equal to the sum of:
(a) all Mortgages Trustee Available Revenue Receipts distributed to Funding 2
during the Interest Period ending on the relevant Payment Date;
(b) other net income of Funding 2 including all amounts of interest received
on the Funding 2 GIC Account and the Funding 2 Transaction Account,
and/or all income from Funding 2's Authorized Investments, on each
Distribution Date during the Interest Period ending on such Payment Date,
in each case to be received on or prior to such Payment Date; and
(c) amounts received from the Funding 2 Basis Rate Swap Provider under the
Funding 2 Basis Rate Swap Agreement (excluding Swap Collateral standing
to the credit of the Funding 2 Swap Collateral Accounts) including any
early termination amounts (other than such early termination amounts
applied or to be applied by Funding 2 in the
87
purchase of one or more replacement hedge transactions) recovered by
Funding 2 under the Funding 2 Basis Rate Swap Agreement;
(d) (only to the extent required after making the calculation set out in
paragraph [__] to Schedule [__] of the Funding 2 Deed of Charge the
aggregate of amounts standing to the credit of the Funding 2 Principal
Ledger or the Funding 2 Cash Accumulation Ledger (as applicable) which
are to be applied on the relevant payment date to pay items (H), (J),
(M), (O), and (Q) of the Funding 2 Pre-Enforcement Revenue Priority of
Payments;
(e) the amount standing to the credit of the Funding 2 Reserve Ledger,
subject to any limits or conditions on the purposes for which the Funding
2 Reserve Fund may be utilized; and
(f) the amount standing to the credit of the Funding 2 Liquidity Reserve
Fund, if any, subject to any limits or conditions on the purposes for
which the Funding 2 Liquidity Reserve Fund may be utilized.
(g) in so far as is needed, any amount available to be drawn under the
Funding 2 Liquidity Facility, if any, for the payment of interest and
expenses.
"Funding 2 Deed of Charge" means the deed of charge entered into on or about
the Funding 2 Programme Date between Funding 2, the Funding 2 Security
Trustee, the Issuer Security Trustee, Granite Master Issuer plc, the Funding 2
Basis Rate Swap Provider, the Corporate Services Provider, the Account Bank,
the Funding 2 GIC Provider, the Mortgages Trustee and the Cash Manager
[others] and the Schedules thereto and including each Deed of Accession or
Accession Undertaking entered into in connection therewith;
"Funding 2 Event of Default" means, as the context requires, any of the
following:
(a) in relation to the Notes issued by any Funding 2 Issuer, the occurrence a
Note Event of Default pursuant to the Terms and Conditions of such Notes;
(b) in relation to any Funding 2 Intercompany Loan Agreement, the occurrence
of a Funding 2 Intercompany Loan Event of Default;
"Funding 2 Final Deferred Contribution" has the meaning given such term in
Clause [4.3(d)] of the Mortgages Trust Deed;
"Funding 2 Intercompany Loan" means a loan (or the aggregate of a number of
separate loans) of the net proceeds of any issue (or all issues) of Notes by a
Funding 2 Issuer, such loan(s) being advanced to Funding 2 by such Funding 2
Issuer pursuant to the terms of a Funding 2 Intercompany Loan Agreement;
"Funding 2 Intercompany Loan Agreement" means an intercompany loan agreement
entered into between Funding 2 and a Funding 2 Issuer in relation to a Funding
2 Intercompany Loan;
"Funding 2 Intercompany Loan Event of Default" means, in relation to the
Global Intercompany Loan Agreement, the occurrence of an event of default
specified as such in Clause 15 (Default) of the Global Intercompany Loan
Agreement, and in relation to any other
88
Funding 2 Intercompany Loan Agreement, the occurrence of an event of default
specified as such in such Funding 2 Intercompany Loan Agreement;
"Funding 2 Issuer" means a wholly-owned subsidiary of Funding 2, which is
established to issue Notes and to make a Funding 2 Intercompany Loan to
Funding 2;
"Funding 2 Liquidity Facility" means a liquidity facility entered into by
Funding 2 at any time after the Funding 2 Programme Date;
"Funding 2 Liquidity Reserve Fund" means the liquidity reserve fund which
Funding 2 will be required to establish if the long term, unsecured,
unsubordinated and unguaranteed debt obligations of the Seller cease to be
rated at least A3 by Xxxxx'x or A- by Fitch (unless Xxxxx'x or Fitch, as
applicable, confirms that the then-current ratings of the Notes of any Funding
2 Issuer will not be adversely affected) and will be funded to the relevant
Funding 2 Liquidity Reserve Required Amount;
"Funding 2 Liquidity Reserve Required Amount" means [o];
"Funding 2 Programme Date" means [o], 2005
"Funding 2 Relevant Distribution" has the meaning given such term in Clause
[4.3(b)] of the Mortgages Trust Deed;
"Funding 2 Reserve Fund" means the reserve fund established in the name of
Funding 2 on the Funding 2 Programme Date in an amount up to the Funding 2
Reserve Maximum Amount, which prior to enforcement may be allocated to help
meet any deficit in Funding Available Revenue Receipts and thereby any deficit
recorded on the Funding 2 Principal Deficiency Ledgers and/or utilised to fund
expenses in connection with the issuance of Notes by Funding 2 Issuers and/or
any deficit in Funding Available Revenue Receipts available for the repayment
of Bullet Loan tranches;
"Funding 2 Reserve Maximum Amount" means, as at any date, the amount (if any)
by which the Target Reserve Required Amount (as at such date) exceeds the
Issuer Reserve Minimum Amount (as at such date);
"Funding 2 Security" means the security granted by Funding 2 under or pursuant
to the Funding 2 Deed of Charge in favour of the Funding 2 Security Trustee
for the benefit of the Funding 2 Secured Creditors or any of them including
the security granted by Funding 2 under or pursuant to any Deed of Accession;
"Funding 2 Security Trustee" means The Bank of New York, whose principal
office is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX, or such other
persons and all other persons for the time being acting as the security
trustee or security trustees pursuant to the Funding 2 Deed of Charge;
"Intercompany Loan Agreements" means the Funding Intercompany Loan Agreements
and the Funding 2 Intercompany Loan Agreements and "Intercompany Loan
Agreement" means, as applicable, a Funding Intercompany Loan Agreement or a
Funding 2 Intercompany Loan Agreement;
"Intercompany Loan Enforcement Notice" means:
89
(a) an enforcement notice served by the Security Trustee on Funding in
relation to the enforcement of the Funding Security following the
occurrence of a Funding Intercompany Loan Event of Default; or
(b) an enforcement notice served by the Funding 2 Security Trustee on Funding
2 in relation to the enforcement of the Funding 2 Security following the
occurrence of a Funding 2 Intercompany Loan Event of Default;
"Issuer" means either a Funding Issuer or a Funding 2 Issuer;
"Issuer Reserve Minimum Amount" means, on any date and subject to amendment as
described in Clause [ ] of the Issuer Cash Management Agreement, the amount
calculated as the product of (a) one per cent. and (b) the aggregate Principal
Amount Outstanding of the Notes (including the Principal Amount Outstanding of
Notes issued on such date;
"Issuer Security" means in relation any Issuer, the security created by such
Issuer pursuant to the applicable Issuer Deed of Charge for the benefit of the
applicable Issuer Secured Creditors;
"Issuer Enforcement Notice" means, in relation to a Funding 2 Issuer, a notice
issued by the applicable Note Trustee to such Funding 2 Issuer, the applicable
Issuer Security Trustee and the Funding 2 Security Trustee declaring all Notes
issued by such Funding 2 Issuer to be due and payable pursuant to the terms
and conditions of such Notes;
"Pass-Through Notes" means, in respect of the Funding 2 Issuers, a Series and
Class of Notes which has no specified redemption dates other than the Final
Maturity Date. If a Trigger Event occurs or the Issuer Security is enforced,
then the Bullet Redemption Notes, the Scheduled Redemption Notes and the
Controlled Amortisation Notes will be deemed to be Pass-Through Notes;
"Scheduled Redemption Notes" means, in relation to a Funding 2 Issuer, any
Series and Class of Notes issued by such Issuer scheduled to be repaid in full
in [two or more] instalments on Scheduled Redemption Dates. Such Scheduled
Redemption Notes will be deemed to be Pass-Through Notes if:
(a) a date specified in relation to the same in the applicable Note
Supplement occurs;
(b) a Trigger Event occurs; or
(c) a Note Acceleration Notice is served in respect of such Notes; or
(d) the Step-Up Date (if any) in relation to such Notes occurs;
"Step-Up Date" means the Payment Date in respect of an Issuer on which the
interest rate on Notes issued by such Issuer increases by a pre-determined
amount following the payment made by such Issuer on such Payment Date, which
date in respect of the First Issuer is the Payment Date occurring in January
2008, and, in relation to any New Issuer, has the meaning specified under the
relevant Issuer Master Definitions Schedule;
"Target Reserve Required Amount" means, as at any date, an amount equal to the
product of (a) the Target Reserve Required Percentage and (b) the Principal
Amount Outstanding of the Global Intercompany Loan (including the Principal
Amount Outstanding of any Loan
90
Tranche (or the increase in the Principal Amount Outstanding of any existing
Loan Tranche that is made on such date);
"Target Reserve Required Percentage" means, on any date and subject to
amendment as described in Clause [ ] of the Cash Management Agreement, the
percentage specified as such in the most recent prospectus supplement;
91
Exhibit 4.3
Dated [o] January 2005
----------------------
NORTHERN ROCK PLC
as Seller
GRANITE FINANCE TRUSTEES LIMITED
as Mortgages Trustee
GRANITE FINANCE FUNDING LIMITED
GRANITE FINANCE FUNDING 2 LIMITED
- and -
THE BANK OF NEW YORK AND FUNDING 2 SECURITY TRUSTEE
as Security Trustee and Funding 2 Security Trustee
------------------------------------------
MORTGAGE SALE AGREEMENT
TENTH DEED OF AMENDMENT
------------------------------------------
SIDLEY XXXXXX XXXXX & XXXX
WOOLGATE EXCHANGE
00 XXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
THIS DEED is made on [o] January 2005
BETWEEN:
(1) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales, whose registered office
is at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as Seller and in its capacity as a Beneficiary;
(2) GRANITE FINANCE TRUSTEES LIMITED (registered number 79309), a private
limited company incorporated under the laws of Jersey, whose registered
office is at 00 Xxxxxxxxx Xxxxxx, Xx. Xxxxxx, Xxxxxx XX0 0XX, Channel
Islands in its capacity as Mortgages Trustee;
(3) GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
limited company incorporated under the laws of Jersey, but acting out of
its branch office established in England (registered overseas company
number FC022999 and branch number BR005916) at 00 Xxxx Xxxx, Xxxxxxx XX0
0XX in its capacity as a Beneficiary;
(4) GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249387) a private
limited company incorporated under the laws of England and Wales, whose
registered office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX in
its capacity as a Beneficiary; and
(5) THE BANK OF NEW YORK a New York banking corporation whose London branch
address is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its
capacity as (1) Security Trustee and (2) Funding 2 Security Trustee.
WHEREAS:
(A) The Seller carries on the business (inter alia) of originating mortgage
loans secured on residential properties in England, Wales and Scotland.
(B) The Seller has sold and assigned to the Mortgages Trustee certain
mortgage loans, together with the benefit of the related security for the
same, on the terms and subject to the conditions set out in the Mortgage
Sale Agreement dated 26 March 2001 among the parties hereto (as amended,
varied, novated or supplemented from time to time, the "Mortgage Sale
Agreement").
(C) The parties have agreed to amend and restate the Mortgage Sale Agreement
(the "First Amended and Restated Mortgage Sale Agreement") pursuant to
the provisions set out in a deed of amendment and restatement dated 23
July 2001 (the "First Deed of Amendment and Restatement").
(D) The parties have agreed to amend and restate the First Amended and
Restated Mortgage Sale Agreement (the "Second Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 28 September 2001 (the "Second Deed of
Amendment and Restatement").
(E) The parties have agreed to amend and restate the Second Amended and
Restated Mortgage Sale Agreement (the "Third Amended and Restated
Mortgage Sale Agreement") pursuant to the
provisions set out in a deed of amendment and restatement dated 20 March
2002 (the "Third Deed of Amendment and Restatement").
(F) The parties have agreed to amend and restate the Third Amended and
Restated Mortgage Sale Agreement (the "Fourth Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 27 January 2003 (the "Fourth Deed of
Amendment and Restatement").
(G) The parties have agreed to amend and restate the Fourth Amended and
Restated Mortgage Sale Agreement (the "Fifth Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 14 April 2003 (the "Fifth Deed of
Amendment and Restatement").
(H) The parties have agreed to amend and restate the Fifth Amended and
Restated Mortgage Sale Agreement (the "Sixth Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 21 May 2003 (the "Sixth Deed of Amendment
and Restatement").
(I) The parties have agreed to amend and restate the Sixth Amended and
Restated Mortgage Sale Agreement (the "Seventh Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 26 January 2004 (the "Seventh Deed of
Amendment and Restatement").
(J) The parties have agreed to amend and restate the Seventh Amended and
Restated Mortgage Sale Agreement (the "Eighth Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 28 January 2004 (the "Eighth Deed of
Amendment and Restatement").
(K) The parties have agreed to amend and reinstate the Eighth Amended and
Restated Mortgage Sale Agreement (the "Ninth Amended and Restated
Mortgage Sale Agreement") pursuant to the provisions set out in a deed of
amendment and restatement dated 22 September 2004.
(L) The parties now wish to amend and restate, and Funding 2 and the Funding
2 Security Trustee wish to become party to, the Ninth Amended and
Restated Mortgage Sale Agreement.
(M) With effect from the date hereof, the provisions of the Mortgage Sale
Agreement, the First Amended and Restated Mortgage Sale Agreement, the
Second Amended and Restated Mortgage Sale Agreement, the Third Amended
and Restated Mortgage Sale Agreement, the Fourth Amended and Restated
Mortgage Sale Agreement, the Fifth Amended and Restated Mortgage Sale
Agreement, the Sixth Amended and Restated Mortgage Sale Agreement, the
Seventh Amended and Restated Mortgage Sale Agreement, the Eighth Amended
and Restated Mortgage Sale Agreement, the Ninth Amended and Restated
Mortgage Sale Agreement and this Deed shall be read and construed as one
document.
NOW IT IS HEREBY AGREED as follows:
2
1. INTERPRETATION
1.1 The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification on [o] January 2005 by Sidley Xxxxxx Xxxxx
& Wood and Xxxxx & Xxxxx LLP (as the same 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.
1.2 The Mortgage Sale Agreement as amended and restated pursuant to the First
Deed of Amendment and Restatement, the Second Deed of Amendment and
Restatement, the Third Deed of Amendment and Restatement, the Fourth Deed
of Amendment and Restatement, the Fifth Deed of Amendment and
Restatement, the Sixth Deed of Amendment and Restatement, the Seventh
Deed of Amendment and Restatement, the Eighth Deed of Amendment and
Restatement, the Ninth Deed of Amendment and Restatement and pursuant
hereto shall be referred to herein as the "Amended and Restated Mortgage
Sale Agreement".
1.3 As used in the Amended and Restated Mortgage Sale Agreement the terms
"Mortgage Sale Agreement", "this Mortgage Sale Agreement", "herein",
"hereinafter", "hereof", "hereto" and other words of similar import shall
mean or refer to the Amended and Restated Mortgage Sale Agreement, unless
the context otherwise specifically requires.
2. AMENDMENTS TO THE NINTH AMENDED AND RESTATED MORTGAGE SALE AGREEMENT
Upon execution of this Deed by the parties hereto, the Ninth Amended and
Restated Mortgage Sale 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 Mortgage Sale Agreement 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.
4. COUNTERPARTS
This Deed may be executed in any number of counterparts, and has the same
effect as if the signatures and/or seals on the counterparts were on a
single copy of this Deed.
5. GOVERNING LAW
5.1 This Deed is governed by, and shall be construed in accordance with,
English law.
5.2 Each of the parties hereto irrevocably agrees that the courts of England
shall have jurisdiction to hear and determine any suit, action or
proceeding, and to settle any disputes, which may arise out of or in
connection with this Deed and, for such purposes, irrevocably submits to
the jurisdiction of such courts.
3
IN WITNESS WHEREOF this Deed has been executed as a deed and delivered by the
parties hereto on the day and year first above written.
Executed by
NORTHERN ROCK PLC
as its deed as follows: By
Signed for and on its behalf by one of its duly ----------------------------------------------
authorised attorneys/signatories Duly Authorised Attorney/Signatory
Name
----------------------------------------------
Signature
----------------------------------------------
Witness
Full name
----------------------------------------------
Occupation
----------------------------------------------
Address Woolgate Exchange
----------------------------------------------
00 Xxxxxxxxxx Xxxxxx
----------------------------------------------
London
----------------------------------------------
XX0X 0XX
----------------------------------------------
Executed by
GRANITE FINANCE FUNDING LIMITED
as its deed as follows: By
Signed for and on its behalf by one of its directors ----------------------------------------------
and by another of its directors/its secretary Director
Name
----------------------------------------------
By
----------------------------------------------
Director/Secretary
Name
----------------------------------------------
Executed by
GRANITE FINANCE FUNDING 2 LIMITED
as its deed as follows: By
Signed for and on its behalf by one of its directors ----------------------------------------------
and by another of its directors/its secretary Director
Name
----------------------------------------------
By
----------------------------------------------
Director/Secretary
Name
----------------------------------------------
4
Executed by
GRANITE FINANCE TRUSTEES LIMITED
as its deed as follows: By
Signed for and on its behalf by one of its directors ----------------------------------------------
and by another of its directors/its secretary Director
Name
----------------------------------------------
By
----------------------------------------------
Director/Secretary
Name
----------------------------------------------
Executed by
THE BANK OF NEW YORK
as its deed as follows: By
Signed for and on its behalf by one of its duly ----------------------------------------------
authorised attorneys/signatories Duly Authorised Attorney/Signatory
Name
----------------------------------------------
5
Appendix 1
Amended and Restated Mortgage Sale Agreement
6
