Exhibit 4.9
DATED [O] SEPTEMBER 2002
NORTHERN ROCK PLC
as Current Issuer Cash Manager
GRANITE MORTGAGES 02-2 PLC
as Current Issuer
- AND -
THE BANK OF NEW YORK
as Note Trustee
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ISSUER CASH MANAGEMENT AGREEMENT
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1. Definitions and Interpretation.............................................1
2. Appointment of Current Issuer Cash Manager.................................1
3. The Current Issuer Cash Management Services................................2
4. Payments, Accounts, Ledgers................................................3
5. Payments Under Current Issuer Swap Agreements; Termination.................5
6. No Liability...............................................................7
7. Costs and Expenses.........................................................7
8. Information................................................................8
9. Remuneration..............................................................10
10. Covenants, Representations and Warranties of Current Issuer Cash Manager..11
11. Current Issuer Cash Management Services Non-Exclusive.....................11
12. Termination...............................................................11
13. Further Assurances........................................................15
14. Miscellaneous.............................................................15
15. Confidentiality...........................................................16
16. No Partnership............................................................16
17. Assignment................................................................17
18. The Note Trustee..........................................................17
19. Non Petition Covenant; Limited Recourse...................................17
20. Amendments and Waiver.....................................................18
21. Notices...................................................................19
22. Third Party Rights........................................................20
23. Execution in Counterparts; Severability...................................20
24. Governing Law and Jurisdiction; Appropriate Forum.........................20
SCHEDULE 1 The Current Issuer Cash Management Services.......................21
SCHEDULE 2 Cash Management and Maintenance of Ledgers........................24
SCHEDULE 3 Form of Issuer Quarterly Report...................................38
SCHEDULE 4 Controlled Amortisation Amount/Target Balance.....................42
SCHEDULE 5 Current Issuer Cash Manager Representations and Warranties........45
THIS ISSUER CASH MANAGEMENT AGREEMENT is made on [o] September 2002
BETWEEN:
(1) NORTHERN ROCK PLC (registered number 3273685), a public limited company
incorporated under the laws of England and Wales whose registered office is
at Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX in its
capacity as the Current Issuer Cash Manager;
(2) GRANITE MORTGAGES 02-2 PLC (registered number 4482804), a public limited
company incorporated under the laws of England and Wales whose registered
office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX as the Current
Issuer; and
(3) THE BANK OF NEW YORK, whose principal office is at One Canada Square, 00xx
Xxxxx, Xxxxxx X00 0XX, in its capacity as Note Trustee.
WHEREAS:
(A) On the Closing Date the Current Issuer will issue the Current Issuer Notes
constituted by the Current Issuer Trust Deed. From the proceeds of the
issue of those Current Issuer Notes, the Current Issuer shall make an
Intercompany Loan to Granite Finance Funding Limited pursuant to the terms
of the Current Issuer Intercompany Loan Agreement.
(B) The Current Issuer Cash Manager is willing to provide cash management
services to the Current Issuer and the Note Trustee on the terms and
subject to the conditions contained in this Agreement.
IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 The provisions of:
(a) the Master Definitions Schedule as amended and restated by (and
appearing in Appendix 1 to) the Master Definitions Schedule Third
Amendment Deed made on [o] September 2002 between, among others, the
Seller, Funding and the Mortgages Trustee, and
(b) the Issuer Master Definitions Schedule signed for the purposes of
identification by Sidley Xxxxxx Xxxxx & Xxxx and Xxxxx & Xxxxx on [o]
September 2002,
(as the same have been and may be amended, varied or supplemented from time
to time with the consent of the parties hereto) are expressly and
specifically incorporated into and shall apply to this Agreement. The
Issuer Master Definitions Schedule specified above shall prevail to the
extent that it conflicts with the Master Definitions Schedule.
2. APPOINTMENT OF CURRENT ISSUER CASH MANAGER
2.1 APPOINTMENT: Until termination pursuant to Clause 12 (Termination), the
Current
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Issuer and the Note Trustee (according to their respective estates and
interests) each hereby appoints the Current Issuer Cash Manager as its
lawful agent on each of their behalves to provide the Current Issuer Cash
Management Services set out in this Agreement, including in relation to the
Current Issuer Notes to be issued by the Current Issuer. The Current Issuer
Cash Manager in each case hereby accepts such appointment on the terms and
subject to the conditions of this Agreement.
2.2 DUTIES PRESCRIBED BY TRANSACTION DOCUMENTS: For the avoidance of doubt and
in connection with the powers conferred under Clause 2.1 (Appointment),
save as expressly provided elsewhere in this Agreement, nothing herein
shall be construed so as to give the Current Issuer Cash Manager any
powers, rights, authorities, directions or obligations other than as
specified in this Agreement or any of the other Transaction Documents.
2.3 APPOINTMENT CONDITIONAL UPON ISSUANCE OF CURRENT ISSUER NOTES: The
appointment pursuant to Clause 2.1 (Appointment) is conditional upon the
issue of the Current Issuer Notes and the making of the Current Issuer
Intercompany Loan under the Current Issuer Intercompany Loan Agreement and
shall take effect upon and from the Closing Date automatically without any
further action on the part of any person, PROVIDED THAT if the issue of the
Current Issuer Notes has not occurred by [31 October 2002], or such later
date as the Current Issuer and the Lead Managers may agree, this Agreement
shall cease to be of further effect.
3. THE CURRENT ISSUER CASH MANAGEMENT SERVICES
3.1 GENERAL: The Current Issuer Cash Manager shall provide the services set out
in this Agreement (including, without limitation, Schedules 1 and 2
attached hereto) (the "CURRENT ISSUER CASH MANAGEMENT SERVICES").
3.2 APPROVALS AND AUTHORISATIONS: The Current Issuer Cash Manager shall
maintain, or procure the maintenance of, the approvals, authorisations,
consents and licences required in connection with the business of the
Current Issuer and shall prepare and submit, or procure the preparation and
submission of, on behalf of the Current Issuer, all necessary applications
and requests for any further approvals, authorisations, consents or
licences which may be required in connection with the business of the
Current Issuer and shall, so far as it reasonably can do so, perform the
Current Issuer Cash Management Services in such a way as not to prejudice
the continuation of any such approvals, authorisations, consents or
licences.
3.3 COMPLIANCE WITH TRANSACTION DOCUMENTS, ETC.: The Current Issuer Cash
Management Services shall include procuring (so far as the Current Issuer
Cash Manager, using its reasonable endeavours, is able so to do) compliance
by the Current Issuer with all applicable legal requirements and with the
terms of the Current Issuer Transaction Documents, PROVIDED THAT the
Current Issuer Cash Manager shall not lend or provide any sum to the
Current Issuer and the Current Issuer Cash Manager shall have no liability
whatsoever to the Current Issuer, the Note Trustee or any other person for
any failure by the Current Issuer to make any payment due by any of them
under any of the Current Issuer Transaction Documents (other than to the
extent arising from the Current Issuer Cash Manager failing to perform any
of its obligations under any of the Transaction Documents).
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3.4 LIABILITY OF CURRENT ISSUER CASH MANAGER:
(a) The Current Issuer Cash Manager shall indemnify each of the Current
Issuer and the Note Trustee on demand for any loss, liability, claim,
expense or damage suffered or incurred by it in respect of the
negligence, bad faith or wilful default of the Current Issuer Cash
Manager in carrying out its functions as Current Issuer Cash Manager
under, or as a result of a breach by the Current Issuer Cash Manager
of, the terms and provisions of this Agreement or such other
Transaction Documents to which the Current Issuer Cash Manager is a
party (in its capacity as such) in relation to such functions.
(b) For the avoidance of doubt, the Current Issuer Cash Manager shall not
be liable in respect of any loss, liability, claim, expense or damage
suffered or incurred by the Current Issuer or the Note Trustee and/or
any other person as a result of the proper performance of the Current
Issuer Cash Management Services (as defined in Clause 3.1 (General))
by the Current Issuer Cash Manager save to the extent that such loss,
liability, claim, expense or damage is suffered or incurred as a
result of any negligence, bad faith or wilful default of the Current
Issuer Cash Manager under, or as a result of a breach by the Current
Issuer Cash Manager of, the terms and provisions of this Agreement or
any of the other Transaction Documents to which the Current Issuer
Cash Manager is a party (in its capacity as such) in relation to such
functions.
4. PAYMENTS, ACCOUNTS, LEDGERS
4.1 CURRENT ISSUER BANK ACCOUNTS: The Current Issuer Cash Manager hereby
confirms that each of the Current Issuer Transaction Accounts have been
established on or before the date hereof and that the mandates in the
agreed form will apply thereto at the Closing Date. The Current Issuer Cash
Manager undertakes (to the extent to which the same is within its control
in its capacity as Current Issuer Cash Manager) that at the Closing Date
the Current Issuer Transaction Accounts will be operative and that the
Current Issuer Cash Manager will not knowingly create or permit to subsist
any Security Interest in relation to the Current Issuer Transaction
Accounts other than as created under or permitted pursuant to the Current
Issuer Deed of Charge.
4.2 CURRENT ISSUER LEDGERS:
(a) The Current Issuer Cash Manager shall open and maintain in the books
of the Current Issuer the following ledgers:
(i) the Current Issuer Revenue Ledger, which shall record all Current
Issuer Revenue Receipts standing to the credit of the Current
Issuer Transaction Accounts from time to time;
(ii) the Current Issuer Principal Ledger, which shall record all
Current Issuer Principal Receipts standing to the credit of the
Current Issuer Transaction Accounts from time to time;
(iii) the Current Issuer Principal Deficiency Ledger, which shall
comprise three sub-ledgers to be known as the Class A Principal
Deficiency Sub Ledger, the Class B Principal Deficiency Sub
Ledger and the Class C
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Principal Deficiency Sub Ledger, and which shall record (A) any
principal deficiencies arising from Losses on the Mortgage Loans
which have been allocated by Funding to the Current Issuer
Intercompany Loan, (B) the application of Current Issuer
Principal Receipts to meet any deficiency in Current Issuer
Revenue Receipts and (C) the application of Funding Available
Principal Receipts to fund the Current Issuer Liquidity Reserve
Fund.
(b) The Current Issuer Cash Manager shall make credits and debits to the
Current Issuer Ledgers in accordance with the provisions of paragraphs
5, 6, 7, 8 and 9 of Schedule 2 hereto.
4.3 PAYMENTS:
(a) The Current Issuer Cash Manager shall procure that the following
amounts payable to the Current Issuer are paid into the Current Issuer
Transaction Accounts:
(i) all Current Issuer Revenue Receipts;
(ii) all Current Issuer Principal Receipts;
(iii) all amounts received by the Current Issuer pursuant to the
Current Issuer Basis Rate Swap Agreement and the Current Issuer
Currency Swap Agreements; and
(iv) any other amounts whatsoever received by or on behalf of the
Current Issuer on or after the Closing Date,
and the Current Issuer Cash Manager shall procure that all investment
proceeds from Authorised Investments purchased from amounts standing
to the credit of any of the Current Issuer Transaction Accounts are
credited to each such account. All amounts received by the Current
Issuer denominated (i) in Sterling shall be paid into the Current
Issuer Sterling Account, (ii) in U.S. Dollars shall be paid into the
Current Issuer Dollar Account and (iii) in Euro shall be paid into the
Current Issuer Euro Account.
(b) The Current Issuer Cash Manager shall procure that all transfers and
withdrawals of amounts standing to the credit of the Current Issuer
Transaction Accounts shall be made in accordance with the provisions
of the Current Issuer Bank Account Agreement and the Current Issuer
Deed of Charge.
(c) Each of the payments into the Current Issuer Transaction Accounts
referred to in Clause 4.3(a) shall be made forthwith upon receipt by
the Current Issuer or the Current Issuer Cash Manager of the amount in
question.
(d) For the avoidance of doubt, as soon as reasonably practicable after
becoming aware of the same, the Current Issuer Cash Manager may, and
shall, withdraw Cash from the Current Issuer Transaction Accounts, if,
and to the extent that,
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such Cash was credited thereto in error and shall use its reasonable
endeavours to ensure that such Cash is applied correctly thereafter.
(e) The Current Issuer Cash Manager shall promptly notify each of the
Current Issuer and the Note Trustee of any additional account or
sub-account which supplements or replaces any account or sub-account
specifically referred to in the definition of the "Current Issuer
Transaction Accounts" in the Current Issuer Master Definitions
Schedule.
(f) Each of the Current Issuer Cash Manager and the Current Issuer
undertakes that, so far as it is able to procure the same, the Current
Issuer Transaction Accounts and all instructions and mandates in
relation thereto will continue to be operative and will not, save as
permitted pursuant to the Current Issuer Bank Account Agreement, be
changed without the prior written consent of the Note Trustee (such
consent not to be unreasonably withheld or delayed). For the avoidance
of doubt, the Current Issuer Cash Manager may change the authorised
signatories in respect of any instructions or mandates relating to the
Current Issuer, without the prior written consent of the Note Trustee,
in accordance with the terms of the Current Issuer Bank Account
Agreement.
4.4 WITHDRAWALS:
(a) The Current Issuer Cash Manager may make withdrawals on behalf of the
Current Issuer from the Current Issuer Transaction Accounts, but only
until receipt of a copy of a Current Issuer Note Enforcement Notice
served by the Note Trustee on the Current Issuer, as permitted by this
Agreement, the Current Issuer Trust Deed, the Current Issuer Bank
Account Agreement and the Current Issuer Deed of Charge, but shall not
in carrying out its functions as Current Issuer Cash Manager under
this Agreement otherwise make withdrawals from the Current Issuer
Transaction Accounts.
(b) Upon receipt of such a Current Issuer Note Enforcement Notice, no
amount shall be withdrawn from any Current Issuer Transaction Account
by the Current Issuer Cash Manager without the prior written consent
of the Note Trustee.
4.5 CASH MANAGEMENT: In administering the Current Issuer Transaction Accounts
on behalf of the Current Issuer and the Note Trustee, the Current Issuer
Cash Manager shall comply with the provisions of Schedule 2 prior to
receipt by the Current Issuer Cash Manager of a copy of any Current Issuer
Note Enforcement Notice served on the Current Issuer. Following service of
a Current Issuer Note Enforcement Notice, the Note Trustee or any Receiver
appointed by the Note Trustee will administer the Current Issuer
Transaction Accounts in accordance with the terms of the Current Issuer
Deed of Charge.
5. PAYMENTS UNDER CURRENT ISSUER SWAP AGREEMENTS; TERMINATION
5.1 CURRENT ISSUER AVAILABLE REVENUE RECEIPTS: Subject to the order of
priorities of payment set out in Schedule 2 or, as the case may be, the
Current Issuer Deed of Charge, on each Payment Date prior to the
enforcement of the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will pay
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Current Issuer Available Revenue Receipts received in respect of the
Current Issuer Intercompany Loan (after making payments ranking higher in
the order or priority of payments) to the Current Issuer Basis Rate Swap
Provider. Amounts received by the Current Issuer Cash Manager from the
Current Issuer Basis Rate Swap Provider will be applied to pay (1) in
respect of the Dollar Notes, the Current Issuer Dollar Currency Swap
Provider, and amounts received by the Current Issuer Cash Manager from the
Current Issuer Dollar Currency Swap Provider will be applied to pay amounts
due to the holders of the relevant classes of Dollar Notes in accordance
with the Current Issuer Pre-Enforcement Revenue Priority of Payments, (2)
in respect of the Sterling Notes, amounts due to the holders of the
relevant classes of Sterling Notes in accordance with the Current Issuer
Pre-Enforcement Revenue Priority of Payments, and (3) in respect of the
Euro Notes, the Current Issuer Euro Currency Swap Provider, and amounts
received by the Current Issuer Cash Manager from the Current Issuer Euro
Currency Swap Provider will be applied to pay amounts due to the holders of
the relevant classes of Euro Notes in accordance with the Current Issuer
Pre-Enforcement Revenue Priority of Payments.
5.2 CURRENT ISSUER AVAILABLE PRINCIPAL RECEIPTS: Subject to the order of
priorities of payment set out in Schedule 2 or, as the case may be, the
Current Issuer Deed of Charge, on each Payment Date prior to enforcement of
the Current Issuer Security under the Current Issuer Deed of Charge, the
Current Issuer Cash Manager will pay Current Issuer Available Principal
Receipts received in respect of the Current Issuer Intercompany Loan (after
making payments ranking higher in the order or priority of payments) to (1)
in respect of the Dollar Notes, the Current Issuer Dollar Currency Swap
Provider, and amounts received by the Current Issuer Cash Manager from the
Current Issuer Dollar Currency Swap Provider will be applied to pay amounts
due to the holders of the relevant classes of Dollar Notes in accordance
with the Current Issuer Pre-Enforcement Principal Priority of Payments, (2)
in respect of the Sterling Notes, amounts due to the holders of the
relevant classes of Sterling Notes in accordance with the Current Issuer
Pre-Enforcement Principal Priority of Payments, and (3) in respect of the
Euro Notes, the Current Issuer Euro Currency Swap Provider, and amounts
received by the Current Issuer Cash Manager from the Current Issuer Euro
Currency Swap Provider will be applied to pay amounts due to the holders of
the relevant classes of Euro Notes in accordance with the Current Issuer
Pre-Enforcement Principal Priority of Payments.
5.3 FOLLOWING A NON-ASSET TRIGGER EVENT: On each Payment Date following the
occurrence of a Non-Asset Trigger Event under the Mortgages Trust Deed but
prior to enforcement of the Funding Security under the Funding Deed of
Charge or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will pay Current Issuer Available
Principal Receipts received in respect of the Current Issuer Intercompany
Loan (after making payments ranking higher in the order or priority of
payments) to (1) in respect of the Dollar Notes, the Current Issuer Dollar
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Dollar Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of Dollar
Notes, and (2) in respect of the Sterling Notes, amounts due to the holders
of the relevant classes of Sterling Notes, and (3) in respect of the Euro
Notes, the Current Issuer Euro Currency Swap Provider, and amounts received
by the Current Issuer Cash Manager from the Current Issuer Euro Currency
Swap Provider will be applied to pay amounts
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due to the holders of the relevant classes of Euro Notes, each in
accordance with the priority of payments set forth in Clause 4.2
(Distribution of Current Issuer Available Principal Receipts Following the
Occurrence of a Non-Asset Trigger Event) of Schedule 2.
5.4 FOLLOWING AN ASSET TRIGGER EVENT: On each Payment Date following the
occurrence of an Asset Trigger Event under the Mortgages Trust Deed but
prior to enforcement of the Funding Security under the Funding Deed of
Charge or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will pay Current Issuer Available
Principal Receipts received in respect of the Current Issuer Intercompany
Loan (after making payments ranking higher in the order or priority of
payments) to (1) in respect of the Dollar Notes, the Current Issuer Dollar
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Dollar Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of Dollar
Notes, and (2) in respect of the Sterling Notes, amounts due to the holders
of the relevant classes of Sterling Notes, and (3) in respect of the Euro
Notes, the Current Issuer Euro Currency Swap Provider, and amounts received
by the Current Issuer Cash Manager from the Current Issuer Euro Currency
Swap Provider will be applied to pay amounts due to the holders of the
relevant classes of Euro Notes, each in accordance with the priority of
payments set forth in Clause 4.3 (Distribution of Current Issuer Available
Principal Receipts Following the Occurrence of an Asset Trigger Event) of
Schedule 2.
5.5 TERMINATION: If on or prior to the date of the earlier of (i) repayment in
full of the Current Issuer Notes or (ii) the service of a Current Issuer
Note Enforcement Notice, the Current Issuer Basis Rate Swap or any of the
Current Issuer Currency Swaps is terminated, the Current Issuer Cash
Manager (on behalf of the Current Issuer and the Note Trustee) shall
purchase a replacement hedge, as applicable, in respect of the relevant
Series of Current Issuer Notes in each case on terms acceptable to the
Rating Agencies, the Current Issuer and the Note Trustee and with a swap
provider that the Rating Agencies have previously confirmed in writing to
the Current Issuer and the Note Trustee will not cause the then-current
ratings of the Current Issuer Notes to be downgraded, withdrawn or
qualified. The Current Issuer may apply any early termination payment
received from, as appropriate, the relevant Swap Provider for such purpose.
6. NO LIABILITY
Save as otherwise provided in this Agreement, the Current Issuer Cash
Manager shall have no liability for the obligations of either the Note
Trustee or the Current Issuer under any of the Transaction Documents or
otherwise and nothing herein shall constitute a guarantee, or similar
obligation, by the Current Issuer Cash Manager of either the Note Trustee
or the Current Issuer in respect of any of them.
7. COSTS AND EXPENSES
7.1 Subject to and in accordance with the Current Issuer Pre-Enforcement
Priority of Payments or, as the case may be, the Current Issuer
Post-Enforcement Priority of Payments, the Current Issuer will on each
Payment Date reimburse the Current Issuer Cash Manager for all
out-of-pocket costs, expenses and charges (together with any amounts in
respect of Irrecoverable VAT due thereon) properly incurred by the
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Current Issuer Cash Manager in the performance of the Current Issuer Cash
Management Services, including any such costs, expenses or charges not
reimbursed to the Current Issuer Cash Manager on any previous Payment Date
and the Current Issuer Cash Manager shall supply the Current Issuer with an
appropriate VAT invoice issued by the Current Issuer Cash Manager or, if
the Current Issuer Cash Manager has treated the relevant cost, expense or
charge as a disbursement for VAT purposes, by the person making the supply.
7.2 Unless and until otherwise agreed by the Current Issuer and the Note
Trustee in writing (notified to the Current Issuer Cash Manager), the
Current Issuer shall be solely responsible for reimbursing the Current
Issuer Cash Manager for the out-of-pocket costs, expenses and charges
(together with any amounts in respect of Irrecoverable VAT due thereon)
referred to in Clause 7.1 (Costs and Expenses).
8. INFORMATION
8.1 USE OF INFORMATION TECHNOLOGY SYSTEMS:
(a) The Current Issuer Cash Manager represents and warrants that at the
date hereof (and in respect of the software which is to be used by the
Current Issuer Cash Manager in providing the Current Issuer Cash
Management Services) it has in place all necessary licences and/or
consents from the respective licensor or licensors (if any) of such
software.
(b) The Current Issuer Cash Manager undertakes that it shall for the
duration of this Agreement, use reasonable endeavours to:
(i) ensure that the licences and/or consents referred to in paragraph
(a) are maintained in full force and effect; and
(ii) except insofar as it would breach any other of its legal
obligations, grant to any person to whom it may sub-contract or
delegate the performance of all or any of its powers and
obligations under this Agreement (and/or to such person as the
Current Issuer and the Note Trustee elects as a substitute cash
manager in accordance with the terms of this Agreement) a licence
to use any proprietary software together with any updates which
may be made thereto from time to time.
(c) The Current Issuer Cash Manager shall use reasonable endeavours to
maintain in working order the information technology systems used by
the Current Issuer Cash Manager in providing the Current Issuer Cash
Management Services.
(d) The Current Issuer Cash Manager shall pass to any person to whom it
may sub-contract or delegate the performance of all or any of its
powers and obligations under this Agreement (and/or to such person as
the Current Issuer and the Note Trustee elects as a substitute cash
manager in accordance with the terms of this Agreement) the benefit of
any warranties in relation to such software insofar as the same are
capable of assignment.
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8.2 BANK ACCOUNT STATEMENTS: The Current Issuer Cash Manager shall take all
reasonable steps to ensure that it receives a monthly bank statement in
relation to each Current Issuer Transaction Account and that it furnishes a
copy of such statements to the Current Issuer, with a copy to the Note
Trustee upon its request.
8.3 ACCESS TO BOOKS AND RECORDS: Subject to all applicable laws, the Current
Issuer Cash Manager shall permit the Current Issuer, the Auditors of the
Current Issuer, the Note Trustee and/or any other person nominated by the
Note Trustee (to whom the Current Issuer Cash Manager has no reasonable
objection) at any time during normal office hours upon reasonable notice to
have access, or procure that such person or persons are granted access, to
all books of record and account relating to the Current Issuer Cash
Management Services provided by the Current Issuer Cash Manager and related
matters in accordance with this Agreement.
8.4 STATUTORY OBLIGATIONS: The Current Issuer Cash Manager will use its
reasonable endeavours, on behalf of the Current Issuer, to prepare or
procure the preparation of and file all reports, annual returns, financial
statements, statutory forms and other returns which the Current Issuer is
required by law to prepare and file. Subject to approval thereof by the
directors of the Current Issuer, the Current Issuer Cash Manager shall
cause such accounts to be audited by the Auditors and shall procure so far
as it is able so to do that the Auditors shall make a report thereon as
required by law, and copies of all such documents shall be delivered to the
Note Trustee, the Current Issuer and the Rating Agencies as soon as
practicable after the end of each accounting reference period of the
Current Issuer.
8.5 INFORMATION COVENANTS:
(a) The Current Issuer Cash Manager shall provide the Current Issuer, the
Note Trustee, the Seller and the Rating Agencies quarterly with a
report in, or substantially in, the form set out in Schedule 3 in
respect of the Current Issuer. Such quarterly report shall be
delivered to the Current Issuer, the Note Trustee (upon its request),
the Seller and the Rating Agencies by the last Business Day of the
month in which each Payment Date occurs.
(b) The Current Issuer Cash Manager shall provide, or procure the
provision of, to the Current Issuer, the Note Trustee and the Rating
Agencies copies of any annual returns or financial statements referred
to in Clause 8.4 (Statutory Obligations) as soon as reasonably
practicable after the preparation thereof.
(c) The Current Issuer Cash Manager shall notify the Rating Agencies and
the Note Trustee in writing of the details of (i) any material
amendment to the Transaction Documents to which the Current Issuer is
a party and of which it is or becomes aware, (ii) the occurrence of a
Current Issuer Note Event of Default, or a Current Issuer Intercompany
Loan Event of Default or a Current Issuer Cash Manager Termination
Event (as defined in Clause 12.1 (Current Issuer Cash Manager
Termination Events)) and (iii) any other information relating to the
Current Issuer Cash Manager as the Rating Agencies and the Note
Trustee may reasonably request in connection with its obligations
under this Agreement, PROVIDED THAT the Note Trustee shall not make
such a request more than once every three months unless, in the belief
of the Note Trustee, a Current Issuer Intercompany Loan Event of
Default, a Current
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Issuer Note Event of Default or a Current Issuer Cash Manager
Termination Event shall have occurred and is continuing or may
reasonably be expected to occur, and PROVIDED FURTHER THAT any such
request by the Note Trustee does not adversely interfere with the
Current Issuer Cash Manager's day-to-day provision of the Current
Issuer Cash Management Services under the other terms of this
Agreement.
(d) After becoming aware of any event described in paragraph (c)(i) or
(ii) above, the Current Issuer Cash Manager shall give details to the
Current Issuer and the Note Trustee of any pending legal action and
any judgments given in respect of the Current Issuer Cash Manager if
it could have a potential material adverse effect on the ability of
the Current Issuer Cash Manager to perform its obligations hereunder.
(e) The Current Issuer Cash Manager shall, at the request of the Note
Trustee, furnish the Note Trustee and the Rating Agencies with such
other information relating to its business and financial condition as
the Note Trustee may request in connection with this Agreement,
PROVIDED THAT the Note Trustee shall not make such a request more than
once every three months unless, in the belief of the Note Trustee, a
Current Issuer Intercompany Loan Event of Default, a Current Issuer
Note Event of Default or a Current Issuer Cash Manager Termination
Event (as defined in Clause 12.1 (Current Issuer Cash Manager
Termination Events)) shall have occurred and is continuing or may
reasonably be expected to occur, and PROVIDED FURTHER THAT any such
request of the Note Trustee does not adversely interfere with the
Current Issuer Cash Manager's day-to-day provision of the Current
Issuer Cash Management Services under the other terms of this
Agreement.
9. REMUNERATION
9.1 FEE PAYABLE:
(a) Subject to paragraph (b) below, the Current Issuer shall pay to the
Current Issuer Cash Manager for the provision of the Current Issuer
Cash Management Services hereunder a cash management fee which shall
be agreed in writing between the Current Issuer, the Note Trustee and
the Current Issuer Cash Manager from time to time.
(b) Unless and until otherwise agreed by the Current Issuer and the Note
Trustee in writing (notified to the Current Issuer Cash Manager), the
Current Issuer shall be solely responsible for paying the cash
management fee to the Current Issuer Cash Manager which is referred to
in paragraph (a) above.
9.2 PAYMENT OF FEE: The cash management fee referred to in Clause 9.1 (Fee
Payable) shall only be payable to the Current Issuer Cash Manager on each
Payment Date in the manner contemplated by, in accordance with and subject
to the provisions of the Current Issuer Pre-Enforcement Revenue Priority of
Payments or, as the case may be, the Current Issuer Post-Enforcement
Priority of Payments.
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10. COVENANTS, REPRESENTATIONS AND WARRANTIES OF CURRENT ISSUER CASH MANAGER
10.1 COVENANTS: The Current Issuer Cash Manager hereby covenants with and
undertakes to each of the Current Issuer and the Note Trustee that without
prejudice to any of its specific obligations hereunder:
(a) it will exercise all due skill, care and diligence to the performance
of its obligations and the exercise of its discretions hereunder;
(b) it will comply with any proper directions, orders and instructions
which the Current Issuer or the Note Trustee may from time to time
give to it in accordance with the provisions of this Agreement and, in
the event of any conflict, those of the Note Trustee shall prevail;
(c) it will obtain and keep in force all licences, approvals,
authorisations and consents which are necessary in connection with the
performance of the Current Issuer Cash Management Services and prepare
and submit all necessary applications and requests for any further
approval, authorisation, consent or licence required in connection
with the performance of the Current Issuer Cash Management Services;
(d) it will not knowingly fail to comply with any legal requirements in
the performance of the Current Issuer Cash Management Services;
(e) it will make all payments required to be made by it pursuant to this
Agreement on the due date for payment thereof for value in the
specified currency on such day without set-off (including, without
limitation, in respect of any fees owed to it) or counterclaim; and
(f) it will not without the prior written consent of the Note Trustee
amend or terminate any of the Current Issuer Transaction Documents
save in accordance with their terms.
10.2 DURATION OF COVENANTS: The covenants of the Current Issuer Cash Manager in
Clause 10.1 (Covenants) shall remain in force until this Agreement is
terminated but without prejudice to any right or remedy of the Current
Issuer and/or the Note Trustee arising from breach of any such covenant
prior to the date of termination of this Agreement.
10.3 REPRESENTATIONS AND WARRANTIES: The Current Issuer Cash Manager hereby
makes the representations and warranties to each of the Current Issuer and
the Note Trustee that are specified on Schedule 5 hereto.
11. CURRENT ISSUER CASH MANAGEMENT SERVICES NON-EXCLUSIVE
Nothing in this Agreement shall prevent the Current Issuer Cash Manager
from rendering or performing services similar to those provided for in this
Agreement to or for itself or other persons, firms or companies or from
carrying on business similar to or in competition with the business of the
Current Issuer or the Note Trustee.
12. TERMINATION
12.1 CURRENT ISSUER CASH MANAGER TERMINATION EVENTS: If any of the following
events
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("CURRENT ISSUER CASH MANAGER TERMINATION EVENTS") shall occur:
(a) default is made by the Current Issuer Cash Manager in the payment on
the due date of any payment due and payable by it under this Agreement
and such default continues unremedied for a period of five (5) London
Business Days after the earlier of the Current Issuer Cash Manager
becoming aware of such default and receipt by the Current Issuer Cash
Manager of written notice from the Current Issuer or the Note Trustee,
as the case may be, requiring the same to be remedied; or
(b) default is made by the Current Issuer Cash Manager in the performance
or observance of any of its other covenants and obligations under this
Agreement, which in the opinion of the Note Trustee is materially
prejudicial to the interests of the holders of the Current Issuer
Notes and such default continues unremedied for a period of twenty
(20) days after the earlier of the Current Issuer Cash Manager
becoming aware of such default and receipt by the Current Issuer Cash
Manager of written notice from the Note Trustee requiring the same to
be remedied; or
(c) the Current Issuer Cash Manager suffers an Insolvency Event,
then the Current Issuer and/or Note Trustee may at once or at any time
thereafter while such default continues by notice in writing to the Current
Issuer Cash Manager with a copy to the Current Issuer Account Bank
terminate its appointment as Current Issuer Cash Manager under this
Agreement with effect from a date (not earlier than the date of the notice)
specified in the notice.
Upon termination of the appointment of the Current Issuer Cash Manager, the
Note Trustee agrees to use its reasonable endeavours to appoint a
substitute Current Issuer Cash Manager. Any substitute Current Issuer Cash
Manager must agree to enter into an agreement substantially on the same
terms as the relevant provisions of this Agreement or on such terms as are
satisfactory to the Current Issuer and the Note Trustee.
Any termination of the appointment of the Current Issuer Cash Manager and
the appointment of a substitute Current Issuer Cash Manager under this
Clause 12.1 is conditional upon the Rating Agencies having previously
confirmed in writing to the Current Issuer and the Note Trustee that the
then-current ratings of the Current Issuer Notes will not be downgraded,
withdrawn or qualified.
The Note Trustee shall have no liability to any person in the event that,
having used reasonable endeavours, it is unable to appoint a substitute
Current Issuer Cash Manager. In any event, the Note Trustee shall only be
required to use its reasonable endeavours to appoint such substitute
Current Issuer Cash Manager. Notwithstanding any other provision of the
Transaction Documents, the Note Trustee shall not itself be required to
perform any duties of the Current Issuer Cash Manager.
The Note Trustee shall not be obliged to monitor or supervise the
performance by any substitute Current Issuer Cash Manager of its duties
hereunder or in relation to the other Transaction Documents nor shall the
Note Trustee be responsible or liable for
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any act or omission of any substitute Current Issuer Cash Manager or for
any loss caused thereby.
12.2 RESIGNATION OF CURRENT ISSUER CASH MANAGER: The Current Issuer Cash Manager
may resign from its appointment under this Agreement only upon giving not
less than twelve (12) months' notice to each of the Current Issuer and the
Note Trustee, PROVIDED THAT:
(a) the Current Issuer and the Note Trustee each consent in writing to
such resignation;
(b) a substitute cash manager shall be appointed, such appointment to be
effective not later than the effective date of such resignation;
(c) such substitute cash manager enters into an agreement substantially on
the same terms as the relevant provisions of this Agreement or on such
terms as are satisfactory to the Current Issuer and the Note Trustee,
and the Current Issuer Cash Manager shall not be released from its
obligations under the relevant provisions of this Agreement until such
substitute cash manager has entered into such new agreement and the
rights of the Current Issuer under such agreement are charged in
favour of the Note Trustee on terms satisfactory to the Note Trustee;
and
(d) the Rating Agencies have confirmed to the Current Issuer and the Note
Trustee that the then-current ratings of the Current Issuer Notes are
not adversely affected as a result thereof.
12.3 EFFECT OF TERMINATION OR RESIGNATION:
(a) On and after termination or resignation of the appointment of the
Current Issuer Cash Manager under this Agreement pursuant to this
Clause 12, all authority and power of the Current Issuer Cash Manager
under this Agreement shall be terminated and be of no further effect
and the Current Issuer Cash Manager shall not thereafter hold itself
out in any way as the agent of the Current Issuer or the Note Trustee
pursuant to this Agreement.
(b) Upon termination or resignation of the appointment of the Current
Issuer Cash Manager under this Agreement pursuant to this Clause 12,
the Current Issuer Cash Manager shall:
(i) forthwith deliver (and in the meantime hold on trust for, and to
the order of, the Current Issuer or the Note Trustee, as the case
may be) to the Current Issuer or the Note Trustee, as the case
may be or as it shall direct, all books of account, papers,
records, registers, correspondence and documents in its
possession or under its control relating to the affairs of or
belongings of the Current Issuer or the Note Trustee, as the case
may be, (if practicable, on the date of receipt) any monies then
held by the Current Issuer Cash Manager on behalf of the Current
Issuer, the Note Trustee and any other assets of the Current
Issuer and the Note Trustee;
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(ii) take such further action as the Current Issuer or the Note
Trustee, as the case may be, may reasonably direct PROVIDED THAT
the Note Trustee shall not be required to take or direct to be
taken such further action unless it has been indemnified to its
satisfaction (and in the event of a conflict between the
directions of Current Issuer and the Note Trustee, the directions
of the Note Trustee shall prevail);
(iii) provide all relevant information contained on computer records
in the form of magnetic tape, together with details of the layout
of the files encoded on such magnetic tapes; and
(iv) co-operate and consult with and assist the Current Issuer or the
Note Trustee or its nominee, as the case may be, (which shall,
for the avoidance of doubt, include any Receiver appointed by it)
for the purposes of explaining the file layouts and the format of
the magnetic tapes generally containing such computer records on
the computer system of the Current Issuer or the Note Trustee or
such nominee, as the case may be.
12.4 NOTICE OF EVENT OF DEFAULT: The Current Issuer Cash Manager shall deliver
to the Current Issuer and the Note Trustee as soon as reasonably
practicable (but in any event within three London Business Days of becoming
aware thereof) a notice of any Current Issuer Cash Manager Termination
Event, any Current Issuer Note Event of Default or any Current Issuer
Intercompany Loan Event of Default, or any event which with the giving of
notice or expiry of any grace period or certification, as specified in such
Current Issuer Cash Manager Termination Event or Current Issuer Note Event
of Default or Current Issuer Intercompany Loan Event of Default, would
constitute the same.
12.5 GENERAL PROVISIONS RELATING TO TERMINATION:
(a) Termination of this Agreement or the appointment of the Current Issuer
Cash Manager under this Agreement shall be without prejudice to the
liabilities of the Current Issuer to the Current Issuer Cash Manager
and vice versa incurred before the date of such termination. The
Current Issuer Cash Manager shall have no right of set-off or any lien
in respect of such amounts against amounts held by it on behalf of the
Current Issuer or the Note Trustee.
(b) This Agreement shall terminate at such time as the Current Issuer
Secured Obligations have been fully discharged.
(c) On termination of the appointment of the Current Issuer Cash Manager
under the provisions of this Clause 12, the Current Issuer Cash
Manager shall be entitled to receive all fees and other monies accrued
up to (but excluding) the date of termination but shall not be
entitled to any other or further compensation. The Current Issuer
shall pay such moneys so receivable by the Current Issuer Cash Manager
in accordance with the Current Issuer Pre-Enforcement Revenue Priority
of Payments or, as the case may be, the Current Issuer
Post-Enforcement Priority of Payments, on the dates on which they
would otherwise have fallen due hereunder. For the avoidance of doubt,
such termination shall not affect the Current Issuer Cash Manager's
rights to
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receive payment of all amounts (if any) due to it from the Current
Issuer other than under this Agreement.
(d) Any provision of this Agreement, which is stated to continue after
termination of the Agreement, shall remain in full force and effect
notwithstanding termination.
13. FURTHER ASSURANCES
13.1 CO-OPERATION, ETC: The parties hereto agree that they will co-operate fully
to do all such further acts and things and execute any further documents as
may be necessary or desirable to give full effect to the arrangements
contemplated by this Agreement and the other Transaction Documents.
13.2 POWERS OF ATTORNEY: Without prejudice to the generality of Clause 13.1
(Co-operation, etc), the Current Issuer shall upon request by the Current
Issuer Cash Manager forthwith give to the Current Issuer Cash Manager such
further powers of attorney or other written authorisations, mandates or
instruments as are necessary to enable the Current Issuer Cash Manager to
perform the Current Issuer Cash Management Services.
14. MISCELLANEOUS
14.1 NO SET-OFF: The Current Issuer Cash Manager agrees that it will not:
(a) set off or purport to set off any amount which either the Current
Issuer is or will become obliged to pay to it under this Agreement
against any amount from time to time standing to the credit of or to
be credited to either of the Current Issuer Transaction Accounts or
any replacement or additional bank account of the Current Issuer and
established from time to time; or
(b) make or exercise any claims or demands, any rights of counterclaim or
any other equities against or withhold payment of any and all sums of
money which may at any time and from time to time standing to the
credit of either of the Current Issuer Transaction Accounts or any
replacement or additional bank account of the Current Issuer and
established from time to time.
14.2 NO RECOURSE:
(a) In relation to all sums due and payable by the Current Issuer to the
Current Issuer Cash Manager, the Current Issuer Cash Manager agrees
that it shall have recourse only to sums paid to or received by (or on
behalf of) the Current Issuer pursuant to the provisions of the
Current Issuer Transaction Documents.
(b) For the avoidance of doubt, the Note Trustee shall not be liable to
pay any amounts due under Clauses 7 (Costs and Expenses) and 9
(Remuneration), but without prejudice to the obligations of the
Current Issuer, or any receiver appointed pursuant to the Current
Issuer Deed of Charge in respect of such amounts.
(c) Notwithstanding any other provisions of this Agreement, all
obligations to, and rights of, the Note Trustee under or in connection
with this Agreement
15
(other than its obligations under Clause 13 (Further Assurances))
shall automatically terminate upon the discharge in full of all
Current Issuer Secured Obligations, PROVIDED THAT this shall be
without prejudice to any claims in respect of such obligations and
rights arising on or prior to such date.
15. CONFIDENTIALITY
During the continuance of this Agreement or after its termination, each of
the Current Issuer, the Current Issuer Cash Manager and the Note Trustee
shall use its best endeavours not to disclose to any person, firm or
company whatsoever any information relating to the business, finances or
other matters of a confidential nature of any other party hereto of which
it may exclusively by virtue of being party to the Transaction Documents
have become possessed and shall use all reasonable endeavours to prevent
any such disclosure as aforesaid, PROVIDED HOWEVER that the provisions of
this Clause 15 shall not apply:
(a) to any information already known to the recipient otherwise than as a
result of entering into any of the Transaction Documents;
(b) to any information subsequently received by the recipient which it
would otherwise be free to disclose;
(c) to any information which is or becomes public knowledge otherwise than
as a result of the conduct of the recipient;
(d) to any extent that the recipient is required to disclose the same
pursuant to any law or order of any court or pursuant to any
direction, request or requirement (whether or not having the force of
law) of any central bank or any governmental or other authority
(including, without limitation, any official bank examiners or
regulators);
(e) to the extent that the recipient needs to disclose the same for
determining the existence of, or declaring, a Current Issuer Note
Event of Default, or a Current Issuer Cash Manager Termination Event,
the protection or enforcement of any of its rights under any of the
Current Issuer Transaction Documents or in connection herewith or
therewith or for the purpose of discharging, in such manner as it
thinks fit, its duties under or in connection with such agreements in
each case to such persons as require to be informed of such
information for such purposes; or
(f) in relation to any information disclosed to the professional advisers
of the recipient or (in connection with a prospective rating of any
debt to be issued by the Current Issuer or any New Issuer) to any
credit rating agency or any prospective new cash manager or
prospective new Note Trustee.
16. NO PARTNERSHIP
It is hereby acknowledged and agreed by the parties that nothing in this
Agreement shall be construed as giving rise to any partnership between any
of the parties.
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17. ASSIGNMENT
17.1 ASSIGNMENT BY THE CURRENT ISSUER: The Current Issuer may not assign or
transfer any of its rights and obligations under this Agreement without the
prior written consent of each of the Note Trustee and the Current Issuer
Cash Manager, except that the Current Issuer may assign its respective
rights hereunder without such consent pursuant to the Current Issuer Deed
of Charge.
17.2 NO ASSIGNMENT BY CURRENT ISSUER CASH MANAGER: The Current Issuer Cash
Manager may not assign or transfer any of its rights and obligations under
this Agreement without the prior written consent of the Current Issuer and
the Note Trustee.
18. THE NOTE TRUSTEE
18.1 CHANGE IN NOTE TRUSTEE: If there is any change in the identity of the note
trustee in accordance with the Issuer Deed of Charge, the Current Issuer
and the Current Issuer Cash Manager shall execute such documents and take
such action as the successor note trustee and the outgoing Note Trustee may
require for the purpose of vesting in the successor note trustee the rights
and obligations of the outgoing Note Trustee under this Agreement and
releasing the outgoing Note Trustee from its future obligations under this
Agreement.
18.2 NO OBLIGATIONS: It is hereby acknowledged and agreed that by its execution
of this Agreement the Note Trustee shall not assume or have any of the
obligations or liabilities of the Current Issuer or the Current Issuer Cash
Manager under this Agreement. Furthermore, any liberty or power which may
be exercised or any determination which may be made hereunder by the Note
Trustee may be exercised or made in the Note Trustee's absolute and
unfettered discretion without any obligation to give reasons therefor, but
in any event must be exercised or made in accordance with the provisions of
the Current Issuer Deed of Charge.
19. NON PETITION COVENANT; LIMITED RECOURSE
19.1 NOTE TRUSTEE TO ENFORCE: The Current Issuer Cash Manager hereby undertakes
to each of the other parties hereto that only the Security Trustee, at the
direction of the Note Trustee, may enforce the security created in favour
of the Note Trustee by the Current Issuer Deed of Charge in accordance with
the provisions thereof.
19.2 LIMITED RECOURSE: The Current Issuer Cash Manager hereby undertakes to each
of the other parties hereto that, notwithstanding any other provision of
this Agreement or any other Transaction Document, no sum due or owing to
the Current Issuer Cash Manager from or by the Current Issuer under this
Agreement shall be payable by the Current Issuer except to the extent that
the Current Issuer has sufficient funds available or (following enforcement
of the Current Issuer Security) the Security Trustee has realised
sufficient funds from the Current Issuer Security to pay such sum subject
to and in accordance with the relevant Current Issuer Priority of Payments,
and provided that all liabilities of the Current Issuer required to be paid
in priority thereto or pari passu therewith pursuant to such Current Issuer
Priority of Payments have been paid, discharged and/or otherwise provided
for in full.
19.3 NON PETITION: The Current Issuer Cash Manager hereby undertakes to each of
the
17
other parties hereto that it shall not take any steps for the purpose of
recovering any amount payable under this Agreement (including, without
limitation, by exercising any rights of set-off) or enforcing any rights
arising out of this Agreement against the Current Issuer and it shall not
take any steps or legal proceedings for the winding-up, dissolution or
reorganisation of, or the institution of insolvency proceedings against,
the Current Issuer or for the appointment of a receiver, administrator,
liquidator or similar officer of the Current Issuer in respect of any or
all of its revenues except to the extent expressly permitted under the
Current Issuer Deed of Charge.
19.4 FOLLOWING ENFORCEMENT: The Current Issuer Cash Manager hereby undertakes to
each of the other parties hereto that, following any enforcement of the
Current Issuer Security, it will hold on trust for, and will pay to, the
Note Trustee or the Receiver, as the case may be, all monies received or
recovered by it (whether by way of set-off or otherwise) otherwise than in
accordance with the Current Issuer Post-Enforcement Priority of Payments in
order that such monies may be applied by the Note Trustee or the Receiver
in accordance with the Current Issuer Post-Enforcement Priority of
Payments.
19.5 CORPORATE OBLIGATIONS: To the extent permitted by law, no recourse under
any obligation, covenant, or agreement of any person contained in this
Agreement shall be had against any shareholder, officer or director of such
person as such, by the enforcement of any assessment or by any legal
proceeding, by virtue of any statute or otherwise; it being expressly
agreed and understood that this Agreement is a corporate obligation of each
person expressed to be a party hereto and no personal liability shall
attach to or be incurred by the shareholders, officers, agents or directors
of such person as such, or any of them, under or by reason of any of the
obligations, covenants or agreements of such person contained in this
Agreement, or implied therefrom, and that any and all personal liability
for breaches by such person of any of such obligations, covenants or
agreements, either under any applicable law or by statute or constitution,
of every such shareholder, officer, agent or director is hereby expressly
waived by each person expressed to be a party hereto as a condition of and
consideration for the execution of this Agreement.
19.6 CURRENT ISSUER DEED OF CHARGE: The provisions of Clause 6 of the Current
Issuer Deed of Charge shall prevail in the event that and to the extent
that they conflict with the provisions of this Clause 19.
20. AMENDMENTS AND WAIVER
20.1 ENTIRE AGREEMENT: This Agreement sets out the entire agreement and
understanding between the parties with respect to the subject matter of
this Agreement superseding all prior oral or written understandings other
than the other Current Issuer Transaction Documents.
20.2 AMENDMENTS AND WAIVER: No amendment or waiver of any provision of this
Agreement nor consent to any departure by any of the parties therefrom
shall in any event be effective unless the same shall be in writing and
signed by each of the parties hereto. In the case of a waiver or consent,
such waiver or consent shall be effective only in the specific instance and
as against the party or parties giving it for the specific purpose for
which it is given.
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20.3 RIGHTS CUMULATIVE: The respective rights of each of the parties to this
Agreement are cumulative and may be exercised as often as they consider
appropriate. No failure on the part of any party to exercise, and no delay
in exercising, any right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right preclude any other
or further exercise thereof or the exercise of any other right. The
remedies in this Agreement are cumulative and not exclusive of any remedies
provided by law.
20.4 RATINGS: No variation or waiver of this Agreement shall be made if the same
would adversely affect the then-current ratings of any of the Notes.
21. NOTICES
Any notices or other communication or document to be given or delivered
pursuant to this Agreement to any of the parties hereto shall be
sufficiently served if sent by prepaid first class post, by hand or by
facsimile transmission and shall be deemed to be given (in the case of
facsimile transmission) when despatched or (where delivered by hand) on the
day of delivery if delivered before 17.00 hours (London time) on a London
Business Day or on the next London Business Day if delivered thereafter or
(in the case of first class post) when it would be received in the ordinary
course of the post and shall be sent:
(a) in the case of the Current Issuer Cash Manager, to Northern Rock PLC,
Northern Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx XX0 0XX (facsimile
number: 0191 213 2203) for the attention of the Group Secretary;
(b) in the case of the Current Issuer, to Granite Mortgages 02-1 plc x/x
Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 020
7606 0643) for the attention of The Company Secretary with a copy to
Northern Rock plc, Northern Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxx xxxx Xxxx
XX0 0XX (facsimile number 0191 213 2203) for the attention of the
Group Secretary;
(c) in the case of the Note Trustee, to The Bank of New York (London
Branch), at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile
number 020 7964 6399) for the attention of Corporate Trust (Global
Structured Finance);
(d) in the case of Fitch, to Fitch Ratings Ltd., at Xxxxx Xxxxx, 0 Xxxxx
Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 0207 417 6262) for the
attention of European Structured Finance Surveillance;
(e) in the case of Moody's, to Xxxxx'x Investors Services, Inc., at 1st
Floor, 0 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxxxxx XX0X 0XX (facsimile
number 0207 772 5400) for the attention of Xxxx Xxxxxxxxx;
(f) in the case of S&P, to Standard & Poor's Ratings Services, a division
of The XxXxxx-Xxxx Companies, Inc., at Xxxxxx Xxxxx, 00 Xxxxxxxx
Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 0207 826 3598) for the
attention of Xxxxx Xxxxxxxx;
or to such other address or facsimile number or for the attention of such
other person or entity as may from time to time be notified by any party or
by any Rating Agency
19
to the others by written notice in accordance with the provisions of this
Clause 21. All notices served under this Agreement shall be simultaneously
copied to the Note Trustee by the person serving the same.
22. THIRD PARTY RIGHTS
A person who is not a party to this Agreement may not enforce any of its
terms under the Contracts (Rights of Third Parties) Xxx 0000, but this
shall not affect any right or remedy of a third party which exists or is
available apart from that Act.
23. EXECUTION IN COUNTERPARTS; SEVERABILITY
23.1 COUNTERPARTS: This Agreement may be executed in any number of counterparts
(manually or by facsimile) and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the
same instrument.
23.2 SEVERABILITY: Where any provision in or obligation under this Agreement
shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations under this Agreement, or of such provision or obligation in any
other jurisdiction, shall not be affected or impaired thereby.
24. GOVERNING LAW AND JURISDICTION; APPROPRIATE FORUM
24.1 GOVERNING LAW: This Agreement is governed by, and shall be construed in
accordance with, English law.
24.2 JURISDICTION: Each of the parties hereto irrevocably agrees that the courts
of England shall have jurisdiction to hear and determine any suit, action
or proceeding, and to settle any disputes, which may arise out of or in
connection with this Agreement and, for such purposes, irrevocably submits
to the jurisdiction of such courts.
24.3 APPROPRIATE FORUM: Each of the parties hereto irrevocably waives any
objection which it might now or hereafter have to the courts of England
being nominated as the forum to hear and determine any Proceedings and to
settle any disputes, and agrees not to claim that any such court is not a
convenient or appropriate forum.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed the day
and year first before written.
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SCHEDULE 1
THE CURRENT ISSUER CASH MANAGEMENT SERVICES
The Current Issuer Cash Manager shall:
(a) make the determinations as set forth in Schedule 2;
(b) invest sums, if any, standing to the credit of the Current Issuer
Transaction Accounts in short-term Authorised Investments as determined by
the Current Issuer and, if applicable, the Note Trustee;
(c) apply the Current Issuer Available Revenue Receipts and Current Issuer
Available Principal Receipts in accordance with the relevant order of
priority of payments for the Current Issuer set out in Schedule 2;
(d) maintain the Current Issuer Principal Deficiency Ledger, and record (1)
principal deficiencies arising from Losses on the Mortgage Loans which have
been allocated by Funding to the Current Issuer Intercompany Loan, (2) the
use of Current Issuer Principal Receipts to meet any deficiency in Current
Issuer Revenue Receipts and (3) the use of Funding Available Principal
Receipts to fund or replenish, as the case may be, the Current Issuer
Liquidity Reserve Fund, if any;
(e) each time it records a debit on a Current Issuer Principal Deficiency Sub
Ledger, also record on such Current Issuer Principal Deficiency Sub Ledger
whether such debit was caused by (1) Losses on the Mortgage Loans which
have been allocated by Funding to the Current Issuer Intercompany Loan, (2)
the application of Current Issuer Principal Receipts to meet any deficiency
in Current Issuer Revenue Receipts, or (3) the application of Funding
Available Principal Receipts to fund or replenish, as the case may be, the
Current Issuer Liquidity Reserve Fund, if any;
(f) provide the Current Issuer, Funding, the Note Trustee (upon its request)
and the Rating Agencies with quarterly reports in relation to the Current
Issuer as set out in Schedule 3;
(g) operate the Current Issuer Bank Accounts and ensure that payments are made
into and from such account in accordance with this Agreement, the Current
Issuer Deed of Charge, the Current Issuer Bank Account Agreement and any
other relevant Current Issuer Transaction Document, PROVIDED HOWEVER THAT
nothing herein shall require the Current Issuer Cash Manager to make funds
available to the Current Issuer to enable such payments to be made other
than as expressly required by the provisions of this Agreement;
(h) keep records for all taxation purposes (including, without limitation VAT);
(i) subject to any applicable law, assist the auditors of the Current Issuer
and provide such information to them as they may reasonably request for the
purpose of carrying out their duties as auditors;
(j) make all returns and filings, give all notices and make all registrations
and other notifications required in the day-to-day operation of the
business of the Current Issuer
21
or required to be given by the Current Issuer pursuant to the Current
Issuer Transaction Documents;
(k) arrange for all payments due to be made by the Current Issuer under any of
the Current Issuer Transaction Documents, PROVIDED THAT such moneys are at
the relevant time available to the Current Issuer and PROVIDED FURTHER that
nothing herein shall constitute a guarantee by the Current Issuer Cash
Manager of all or any of the obligations of the Current Issuer under any of
the Current Issuer Transaction Documents;
(l) without prejudice to the role of and in conjunction with the Current Issuer
Corporate Services Provider under the Current Issuer Corporate Services
Agreement, keep general books of account and records of the Current Issuer;
provide accounting services, including reviewing receipts and payments,
supervising and assisting in the preparation of interim statements and
final accounts and supervising and assisting in the preparation of tax
returns;
(m) without prejudice to the role of and in conjunction with the Current Issuer
Corporate Services Provider under the Current Issuer Corporate Services
Agreement, provide or procure the provision of company secretarial and
administration services to the Current Issuer including the keeping of all
registers and the making of all returns and filings required by applicable
law or by UK regulatory authorities, co-operate in the convening of board
and general meetings and provide registered office facilities;
(n) itself on behalf of the Current Issuer, PROVIDED THAT such monies are at
the relevant time available to the Current Issuer, pay all the
out-of-pocket expenses of the Current Issuer, incurred by the Current
Issuer Cash Manager on behalf of the Current Issuer in the performance of
the Current Issuer Cash Manager's duties hereunder including without
limitation:
(i) all Taxes which may be due or payable by the Current Issuer;
(ii) all necessary filing and other fees in compliance with regulatory
requirements;
(iii) all legal and audit fees and other professional advisory fees; and
(iv) all communication expenses including postage, courier and telephone
charges,
(o) the Current Issuer Cash Manager may invest monies standing from time to
time to the credit of the Current Issuer Transaction Accounts subject to
the following provisions:
(i) any such Authorised Investment shall be made in the joint names of the
Current Issuer and the Note Trustee;
(ii) any costs properly and reasonably incurred in making and changing
Authorised Investments will be reimbursed to the Current Issuer Cash
Manager and the Note Trustee by the Current Issuer;
(iii) all income or proceeds following the disposal or maturity of
Authorised Investments shall be credited to the Current Issuer
Transaction Accounts from which moneys were withdrawn to make the
relevant Authorised Investment; and
22
(iv) following the enforcement of the Current Issuer Security no such
investment may be made without the prior written consent of the Note
Trustee.
The Note Trustee and the Current Issuer Cash Manager shall not be
responsible (save where any loss results from the Note Trustee's or
the Current Issuer Cash Manager's own fraud, wilful default or gross
negligence or that of its officers or employees) for any loss
occasioned by reason of any such Authorised Investments whether by
depreciation in value or otherwise provided that such Authorised
Investments were made in accordance with the above provisions;
(p) (i) if necessary, perform all currency conversions free of charge, cost or
expense at the relevant exchange rate; and
(ii) if necessary, perform all interest rate conversions free of charge,
cost or expense at the relevant interest swap rate.
for the purposes of any calculations referred to in sub-paragraphs (i)
and (ii) above, all percentages resulting from such calculations will
be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point (e.g. 9.876541% (or 0.09876541) being rounded down to
9.87654% (or 0.0987654)) and (ii) any currency amounts used in or
resulting from such calculations will be rounded in accordance with
the relevant market practice; and
(q) arrange payment of all fees to the London Stock Exchange plc or, as
applicable, the UK Listing Authority.
23
SCHEDULE 2
CASH MANAGEMENT AND MAINTENANCE OF LEDGERS
1. DETERMINATION
(a) On or before each Current Issuer Note Determination Date immediately
preceding a Payment Date, the Current Issuer Cash Manager shall
determine each of the following in accordance with this paragraph 1:
(i) the amount of any Current Issuer Available Revenue Receipts to be
applied on the following Payment Date in accordance with the
Current Issuer Pre-Enforcement Revenue Priority of Payments set
forth in paragraph 3 of this Schedule 2;
(ii) the amount of any Current Issuer Available Principal Receipts to
be applied on the following Payment Date in accordance with the
Current Issuer Pre-Enforcement Principal Priority of Payments set
forth in paragraph 4 of this Schedule 2;
(iii) whether there will be an excess or a deficit of the Current
Issuer Available Revenue Receipts to pay items (A) through (O) of
the Current Issuer Pre-Enforcement Revenue Priority of Payments
(after taking account of any Shared Issuer Revenue Receipts
available therefor) as set forth in paragraph 3 of this Schedule
2;
(iv) the various amounts, balances and rates to be calculated in
accordance with the Current Issuer Basis Rate Swap and the
Current Issuer Currency Swaps, and shall promptly notify the
Current Issuer, the Note Trustee and each Calculation Agent (as
defined in each Current Issuer Basis Rate Swap Agreement and each
Current Issuer Currency Swap Agreement) of such amounts, balances
and rates; and
(v) the Principal Amount Outstanding of the Current Issuer Notes, the
Pool Factor, and the Note Principal Payment of the Current Issuer
Notes in accordance with the Conditions.
(b) If the Current Issuer Cash Manager determines (as set forth in
paragraph 1(a)(iii)) that there is a deficit (a "CURRENT ISSUER INCOME
DEFICIT") in the amount of Current Issuer Available Revenue Receipts
to pay items (A) through (E), (G) and/or (I) of the Current Issuer
Pre-Enforcement Revenue Priority of Payments, and the Current Issuer
has provided for that deficit by the application of funds standing to
the credit of the Current Issuer Principal Ledger, if any, then the
Current Issuer Cash Manager shall make a corresponding debit entry in
the relevant Current Issuer Principal Deficiency Sub Ledger, PROVIDED
THAT the Current Issuer Cash Manager shall ensure that Current Issuer
Principal Receipts are not used to pay interest on any class of
Current Issuer Notes if and to the extent that would result in a
deficiency being recorded, or an existing deficiency being increased,
on a Current Issuer Principal Deficiency Sub Ledger relating to a
higher ranking
24
Class of Current Issuer Notes, and furthermore that Current Issuer
Principal Receipts are not used to make up any deficit other than in
respect of items (A) through (E), (G) and (I) of the Current Issuer
Pre-Enforcement Revenue Priority of Payments. The Current Issuer Cash
Manager shall thereafter record as a debit on the Current Issuer
Revenue Ledger the application by the Current Issuer of any excess
Current Issuer Available Revenue Receipts to extinguish any balance on
a Current Issuer Principal Deficiency Sub Ledger.
(c) The Current Issuer Cash Manager may make all the determinations
referred to in paragraph 1(a) on the basis of any reasonable and
proper assumptions as the Current Issuer Cash Manager considers
appropriate (including without limitation as to the amount of any
payments to be made under paragraph 3 below during the period from and
including the Current Issuer Note Determination Date immediately
preceding a Payment Date to but excluding such Payment Date).
The Current Issuer Cash Manager shall notify the Current Issuer and
the Note Trustee on request of any such other assumptions and shall
take account of any representations made by the Current Issuer and the
Note Trustee (as the case may be) in relation thereto.
(d) Each determination made in accordance with this paragraph 1 shall (in
the absence of bad faith, wilful default, negligence and manifest
error) be final and binding on all persons.
2. NOTIFICATION OF DETERMINATIONS
(a) The Current Issuer Cash Manager will cause each determination of
Current Issuer Available Principal Receipts and Current Issuer
Available Revenue Receipts (in accordance with paragraph 1(a)(i) and
(ii)) and any Current Issuer Income Deficit (in accordance with
paragraph 1(a)(iii)) to be notified forthwith, following the
calculation thereof, to the Current Issuer.
(b) The Current Issuer Cash Manager shall procure that the determinations
and notifications required to be made pursuant to Condition 5(C) of
the Conditions are made.
3. PRIORITY OF PAYMENTS FOR CURRENT ISSUER AVAILABLE REVENUE RECEIPTS
Current Issuer Available Revenue Receipts will be applied, as applicable:
(a) on each Payment Date; or
(b) on each day when due in respect of amounts due to third parties
pursuant to paragraph (C) below,
in each case prior to the enforcement of the Current Issuer Security
pursuant to the Current Issuer Deed of Charge or until such time as there
are no Current Issuer Secured Obligations outstanding, in making such
payments and provisions in the following order of priority (in each case
only if and to the extent that payments or
25
provisions of a higher priority have been made in full) (the "CURRENT
ISSUER PRE-ENFORCEMENT REVENUE PRIORITY OF PAYMENTS"):
(A) first, to pay amounts due to the Note Trustee, together with interest
and (to the extent not already inclusive) VAT on those amounts, and to
provide for any amounts due or to become due during the following
Interest Period to the Note Trustee under the Current Issuer Trust
Deed, the Current Issuer Deed of Charge or any other Transaction
Document;
(B) second, in no order of priority between them but in proportion to the
respective amounts due, to pay amounts due to the Agent Bank, the
Paying Agents, the Transfer Agent and the Registrar, together with
interest and (to the extent not already inclusive) VAT on those
amounts, and to provide for any costs, charges, liabilities and
expenses due or to become due during the following Interest Period to
the Agent Bank, the Paying Agents, the Transfer Agent and the
Registrar under the Current Issuer Paying Agent and Agent Bank
Agreement;
(C) third, to pay amounts due to any third party creditors of the Current
Issuer (other than those referred to later in this order of priority
of payments or in the Current Issuer Pre-Enforcement Principal
Priority of Payments), of which the Current Issuer Cash Manager has
notice prior to the relevant Payment Date, which amounts have been
incurred without breach by the Current Issuer of the Transaction
Documents to which it is a party and for which payment has not been
provided for elsewhere and to provide for any such amounts expected to
become due and payable during the following Interest Period by the
Current Issuer and to pay or discharge any liability of the Current
Issuer for corporation tax on any chargeable income or gain of the
Current Issuer;
(D) fourth, in no order of priority between them but in proportion to the
respective amounts due, to pay amounts due to the Current Issuer Cash
Manager under the Current Issuer Cash Management Agreement, the
Current Issuer Corporate Services Provider under the Current Issuer
Corporate Services Agreement and the Current Issuer Account Bank under
the Current Issuer Bank Account Agreement together with (to the extent
not already inclusive) VAT on those amounts, and to provide for any
amounts due, or to become due in the immediately succeeding interest
period, to the Current Issuer Cash Manager under the Current Issuer
Cash Management Agreement, to the Current Issuer Corporate Services
Provider under the Current Issuer Corporate Services Agreement and to
the Current Issuer Account Bank under the Current Issuer Bank Account
Agreement;
(E) fifth, in no order of priority between them but in proportion to the
respective amounts due, to pay:
(1) amounts (including such part of any termination payment) due to
the Current Issuer Basis Rate Swap Provider (except for any
termination payment due and payable to the Current Issuer Basis
Rate Swap Provider as a result of a Basis Rate Swap Provider
Default);
26
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A1 Dollar Currency
Swap Provider under the Series 1 Class A1 Dollar Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider Default
by that Swap Provider) and from amounts received in respect of
interest from the Series 1 Class A1 Dollar Currency Swap Provider
to pay interest due or overdue on the Series 1 Class A1 Notes to
holders of the Series 1 Class A1 Notes;
(3) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A2 Dollar Currency
Swap Provider under the Series 1 Class A2 Dollar Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider Default
by that Swap Provider) and from amounts received in respect of
interest from the Series 1 Class A2 Dollar Currency Swap Provider
to pay interest due or overdue on the Series 1 Class A2 Notes to
holders of the Series 1 Class A2 Notes;
(4) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class A Euro Currency
Swap Provider under the Series 2 Class A Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
interest from the Series 2 Class A Euro Currency Swap Provider to
pay interest due or overdue on the Series 2 Class A Notes to the
holders of the Series 2 Class A Notes; and
(5) amounts due to pay interest due or overdue on the Series 3 Class
A Notes to the holders of the Series 3 Class A Notes;
(F) sixth, towards a credit to the Class A Principal Deficiency Sub Ledger
in an amount up to the amount necessary to eliminate any debit on the
Class A Principal Deficiency Sub Ledger;
(G) seventh, in no order of priority between them but in proportion to the
respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class B Dollar Currency
Swap Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider Default
by that Swap Provider) and from amounts received in respect of
interest from the Series 1 Class B Dollar Currency Swap Provider
to pay interest due or overdue on the Series 1 Class B Notes to
the holders of the Series 1 Class B Notes;
27
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class B Euro Currency
Swap Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
interest from the Series 2 Class B Euro Currency Swap Provider to
pay interest due or overdue on the Series 2 Class B Notes to the
holders of the Series 2 Class B Notes; and
(3) amounts due to pay interest due or overdue on the Series 3 Class
B Notes to the holders of the Series 3 Class B Notes;
(H) eighth, towards a credit to the Class B Principal Deficiency Sub
Ledger in an amount up to the amount necessary to eliminate any debit
on the Class B Principal Deficiency Sub Ledger;
(I) ninth, in no order of priority between them but in proportion to the
respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class C Dollar Currency
Swap Provider under the Series 1 Class C Dollar Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider Default
by that Swap Provider) and from amounts received in respect of
interest from the Series 1 Class C Dollar Currency Swap Provider
to pay interest due or overdue on the Series 1 Class C Notes to
the holders of the Series 1 Class C Notes;
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class C Euro Currency
Swap Provider under the Series 2 Class C Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
interest from the Series 2 Class C Euro Currency Swap Provider to
pay interest due or overdue on the Series 2 Class C Notes to the
holders of the Series 2 Class C Notes; and
(3) amounts due to pay interest due or overdue on the Series 3 Class
C Notes to the holders of the Series 3 Class C Notes;
(J) tenth, towards a credit to the Class C Principal Deficiency Sub Ledger
in an amount up to the amount necessary to eliminate any debit on the
Class C Principal Deficiency Sub Ledger;
(K) eleventh, to pay amounts due to pay interest due or overdue on the
Series 3 Class D Notes to the holders of the Series 3 Class D Notes;
28
(L) twelfth, to pay up to the Series 3 Class D Controlled Amortisation
Amount to the holders of the Series 3 Class D Notes
(M) thirteenth, in no order of priority between them but in proportion to
the respective amounts due, to pay any termination payment to:
(1) the Current Issuer Basis Rate Swap Provider following a Basis
Rate Swap Provider Default;
(2) any Dollar Currency Swap Provider following a Dollar Currency
Swap Provider Default; and
(3) any Euro Currency Swap Provider following a Euro Currency Swap
Provider Default;
(N) fourteenth, to pay to the Current Issuer an amount equal to 0.01% per
annum of the interest received under the Current Issuer Intercompany
Loan, to be retained by the Current Issuer as profit, less corporation
tax in respect of those profits provided for or paid at item (C)
above; and
(O) last, to pay to shareholders of the Current Issuer any dividend
declared by the Current Issuer.
4. PRIORITY OF PAYMENTS FOR CURRENT ISSUER AVAILABLE PRINCIPAL RECEIPTS
4.1 DISTRIBUTION OF CURRENT ISSUER AVAILABLE PRINCIPAL RECEIPTS PRIOR TO
ENFORCEMENT OF THE CURRENT ISSUER SECURITY
Prior to enforcement of the Current Issuer Security pursuant to the Current
Issuer Deed of Charge and/or the occurrence of a Trigger Event, or until
such time as there are no Current Issuer Notes outstanding, Current Issuer
Available Principal Receipts will be applied in the following order of
priority (the "CURRENT ISSUER PRE-ENFORCEMENT PRINCIPAL PRIORITY OF
PAYMENTS"):
(A) first, amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A1 Dollar Currency Swap
Provider under the Series 1 Class A1 Dollar Currency Swap (except for
any termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received in respect of principal from the
Series 1 Class A1 Dollar Currency Swap Provider to pay up to the
Series 1 Class A1 Controlled Amortisation Amount to the holders of the
Series 1 Class A1 Notes;
(B) second, amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A2 Dollar Currency Swap
Provider under the Series 1 Class A2 Dollar Currency Swap (except for
any termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received in respect of principal from the
Series 1 Class A2 Dollar Currency Swap Provider to pay up to the
Series 1 Class A2 Controlled Amortisation Amount to the holders of the
Series 1 Class A2 Notes;
29
(C) third, in no order of priority between them but in proportion to the
respective amounts due, to pay:
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class A Euro Currency
Swap Provider under the Series 2 Class A Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
principal from the Series 2 Class A Euro Currency Swap Provider
to pay up to the Series 2 Class A Controlled Amortisation Amount
to the holders of the Series 2 Class A Notes; and
(2) up to the Series 3 Class A Controlled Amortisation Amount to the
holders of the Series 3 Class A Notes;
(D) fourth, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied on such
Payment Date (or, if any of the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are not satisfied on
such Payment Date, but the Class A Notes have been repaid in full), in
no order of priority between them but in proportion to the respective
amounts due, to pay:
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class B Dollar Currency
Swap Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider Default
by that Swap Provider) and from amounts received in respect of
principal from the Series 1 Class B Dollar Currency Swap Provider
to pay up to the Series 1 Class B Controlled Amortisation Amount
to the holders of the Series 1 Class B Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class B Euro Currency
Swap Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
principal from the Series 2 Class B Euro Currency Swap Provider
to pay up to the Series 2 Class B Controlled Amortisation Amount
to the holders of the Series 2 Class B Notes; and
(3) up to the Series 3 Class B Controlled Amortisation Amount to the
holders of the Series 3 Class B Notes; and
(E) last, provided that the Issuer Reserve Requirement, the Issuer Arrears
Test and the Subordinated Principal Test are satisfied on such Payment
Date (or, if any of the Issuer Reserve Requirement, the Issuer Arrears
Test and the Subordinated Principal Test are not satisfied on such
Payment Date, but the Class A Notes have been repaid in full) to pay:
30
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class C Dollar Currency
Swap Provider (except for any termination payment due and payable
to that Swap Provider as a result of a Dollar Currency Swap
Provider Default by that Swap Provider) under the Series 1 Class
C Dollar Currency Swap and from amounts received in respect of
principal from the Series 1 Class C Dollar Currency Swap Provider
to pay up to the Series 1 Class C Controlled Amortisation Amount
to the holders of the Series 1 Class C Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class C Euro Currency
Swap Provider under the Series 2 Class C Euro Currency Swap
(except for any termination payment due and payable to that Swap
Provider as a result of a Euro Currency Swap Provider Default by
that Swap Provider) and from amounts received in respect of
principal from the Series 2 Class C Euro Currency Swap Provider
to pay up to the Series 2 Class C Controlled Amortisation Amount
to the holders of the Series 2 Class C Notes; and
(3) up to the Series 3 Class C Controlled Amortisation Amount to the
holders of the Series 3 Class C Notes.
The Controlled Amortisation Amount of each class of Current Issuer Notes
for each Payment Date is as set forth on Schedule 4.
4.2 DISTRIBUTION OF CURRENT ISSUER AVAILABLE PRINCIPAL RECEIPTS FOLLOWING THE
OCCURRENCE OF A NON-ASSET TRIGGER EVENT
Following the occurrence of a Non-Asset Trigger Event but prior to
enforcement of the Funding Security under the Funding Deed of Charge and/or
the Current Issuer Security under the Current Issuer Deed of Charge, the
Current Issuer Cash Manager will apply Current Issuer Available Principal
Receipts in the following order of priority:
(A) first, to pay amounts (including such part of any termination payment)
due to the Series 1 Class A1 Dollar Currency Swap Provider under the
Series 1 Class A1 Dollar Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a Dollar
Currency Swap Provider Default by that Swap Provider) and from amounts
received from the Series 1 Class A1 Dollar Currency Swap Provider to
repay the Series 1 Class A1 Notes until the Series 1 Class A1 Notes
have been repaid in full;
(B) second, to pay amounts (including such part of any termination
payment) due to the Series 1 Class A2 Dollar Currency Swap Provider
under the Series 1 Class A2 Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a result
of a Dollar Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 1 Class A2 Dollar Currency Swap
Provider to repay the Series 1 Class A2 Notes until the Series 1 Class
A2 Notes have been repaid in full;
31
(C) third, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 2 Class A Euro Currency Swap Provider under the
Series 2 Class A Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class A Euro Currency
Swap Provider to repay the Series 2 Class A Notes until the
Series 2 Class A Notes have been repaid in full; and
(2) to repay the Series 3 Class A Notes until the Series 3 Class A
Notes have been repaid in full;
(D) fourth, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 1 Class B Dollar Currency Swap Provider under
the Series 1 Class B Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class B
Dollar Currency Swap Provider to repay the Series 1 Class B Notes
until the Series 1 Class B Notes have been repaid in full;
(2) to pay amounts (including such part of any termination payment)
due to the Series 2 Class B Euro Currency Swap Provider under the
Series 2 Class B Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class B Euro Currency
Swap Provider to repay the Series 2 Class B Notes until the
Series 2 Class B Notes have been repaid in full; and
(3) to repay the Series 3 Class B Notes until the Series 3 Class B
Notes have been repaid in full; and
(E) last, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 1 Class C Dollar Currency Swap Provider under
the Series 1 Class C Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class C
Dollar Currency Swap Provider to repay the Series 1 Class C Notes
until the Series 1 Class C Notes have been repaid in full;
32
(2) to pay amounts (including such part of any termination payment)
due to the Series 2 Class C Euro Currency Swap Provider under the
Series 2 Class C Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class C Euro Currency
Swap Provider to repay the Series 2 Class C Notes until the
Series 2 Class C Notes have been repaid in full; and
(3) to repay the Series 3 Class C Notes until the Series 3 Class C
Notes have been repaid in full.
4.3 DISTRIBUTION OF CURRENT ISSUER AVAILABLE PRINCIPAL RECEIPTS FOLLOWING THE
OCCURRENCE OF AN ASSET TRIGGER EVENT
Following the occurrence of an Asset Trigger Event but prior to enforcement
of the Funding Security under the Funding Deed of Charge and/or the Current
Issuer Security under the Current Issuer Deed of Charge, the Current Issuer
Cash Manager will apply Current Issuer Available Principal Receipts in the
following order of priority:
(A) first, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 1 Class A1 Dollar Currency Swap Provider under
the Series 1 Class A1 Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class A1
Dollar Currency Swap Provider to repay the Series 1 Class A1
Notes until the Series 1 Class A1 Notes have been repaid in full;
(2) to pay amounts (including such part of any termination payment)
due to the Series 1 Class A2 Dollar Currency Swap Provider under
the Series 1 Class A2 Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class A2
Dollar Currency Swap Provider to repay the Series 1 Class A2
Notes until the Series 1 Class A2 Notes have been repaid in full;
(3) to pay amounts (including such part of any termination payment)
due to the Series 2 Class A Euro Currency Swap Provider under the
Series 2 Class A Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class A Euro Currency
Swap Provider to repay the Series 2 Class A Notes until the
Series 2 Class A Notes have been repaid in full; and
33
(4) to repay the Series 3 Class A Notes until the Series 3 Class A
Notes have been repaid in full;
(B) second, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 1 Class B Dollar Currency Swap Provider under
the Series 1 Class B Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class B
Dollar Currency Swap Provider to repay the Series 1 Class B Notes
until the Series 1 Class B Notes have been repaid in full; and
(2) to pay amounts (including such part of any termination payment)
due to the Series 2 Class B Euro Currency Swap Provider under the
Series 2 Class B Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class B Euro Currency
Swap Provider to repay the Series 2 Class B Notes until the
Series 2 Class B Notes have been repaid in full; and
(3) to repay the Series 3 Class B Notes until the Series 3 Class B
Notes have been repaid in full; and
(C) last, in no order of priority between them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination payment)
due to the Series 1 Class C Dollar Currency Swap Provider under
the Series 1 Class C Dollar Currency Swap (except for any
termination payment due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that Swap
Provider) and from amounts received from the Series 1 Class C
Dollar Currency Swap Provider to repay the Series 1 Class C Notes
until the Series 1 Class C Notes have been repaid in full;
(2) to pay amounts (including such part of any termination payment)
due to the Series 2 Class C Euro Currency Swap Provider under the
Series 2 Class C Euro Currency Swap (except for any termination
payment due and payable to that Swap Provider as a result of a
Euro Currency Swap Provider Default by that Swap Provider) and
from amounts received from the Series 2 Class C Euro Currency
Swap Provider to repay the Series 2 Class C Notes until the
Series 2 Class C Notes have been repaid in full; and
(3) to repay the Series 3 Class C Notes until the Series 3 Class C
Notes have been repaid in full.
34
5. USE OF LEDGERS
The Current Issuer Cash Manager shall forthwith record monies received or
payments made by it on behalf of the Current Issuer in the ledgers in the
manner set out in this Agreement. If, at any time, the Current Issuer Cash
Manager is in any doubt as to which ledger a particular amount should be
credited or debited, it shall consult with the Note Trustee thereon.
Except in the case of the Current Issuer Principal Deficiency Ledger, a
debit item shall only be made in respect of any of the Current Issuer
Ledgers, and the corresponding payment or transfer (if any) may only be
made from the Current Issuer Transaction Accounts, to the extent that such
entry does not cause the relevant ledger to have a debit balance. In the
case of the Current Issuer Principal Deficiency Ledger and each Current
Issuer Principal Deficiency Sub Ledger, a credit item shall only be made to
the extent that such entry does not cause such ledger to have a credit
balance.
6. CURRENT ISSUER REVENUE LEDGER
The Current Issuer Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Current Issuer Revenue
Ledger:
(i) all interest fees and any other amount (not including principal),
if any, paid by Funding to the Current Issuer under the terms of
the Current Issuer Intercompany Loan;
(ii) all interest received by the Current Issuer in respect of the
Current Issuer Bank Accounts;
(iii) all amounts received by the Current Issuer representing income
on any Current Issuer Authorised Investments;
(iv) all amounts (other than any early termination payment which is to
be used to acquire, if necessary, a new basis rate swap) received
by the Current Issuer under the Basis Rate Swap Agreement;
(v) all revenue amounts (other than any early termination payment
which is to be used to acquire, if necessary, a new currency
swap) received by the Current Issuer under the Currency Swap
Agreements; and
(vi) any amount debited to the Current Issuer Principal Ledger under
paragraph 8; and
(b) any payment or provision made under paragraphs 1 and 3 of this
Schedule 2 shall be debited to the Current Issuer Revenue Ledger.
7. CURRENT ISSUER PRINCIPAL LEDGER
Without prejudice to paragraph 8 below, the Current Issuer Cash Manager
shall ensure that:
(a) the following amounts shall be credited to the Current Issuer
Principal Ledger:
35
(i) all principal paid by Funding to the Current Issuer under the
terms of the Current Issuer Intercompany Loan; and
(ii) amounts credited to the Current Issuer Principal Deficiency
Ledger under paragraphs 3 and 8; and
(b) any payment or provision made under paragraph 4 of this Schedule 2
shall be debited to the Current Issuer Principal Ledger.
8. CURRENT ISSUER PRINCIPAL DEFICIENCY LEDGER
(a) Without prejudice to paragraph 7, the Current Issuer Cash Manager
shall ensure that there shall be debited to the Current Issuer
Principal Deficiency Ledger:
(i) principal deficiencies arising from Losses on the Mortgage Loans
which have been allocated by Funding to the Current Issuer
Intercompany Loan;
(ii) the use of Current Issuer Available Principal Receipts to meet
any deficiency in Current Issuer Available Revenue Receipts; and
(iii) the use of Funding Available Principal Receipts to fund the
Current Issuer Liquidity Reserve Fund, if any.
(b) The Current Issuer Cash Manager shall ensure that there shall be
credited to the Current Issuer Principal Deficiency Ledger any amount
to be credited in accordance with paragraph 3 above.
(c) Amounts to be debited to the Current Issuer Principal Deficiency
Ledger shall be debited in the following order:
(i) first, on the Class C Principal Deficiency Sub Ledger, until the
balance of the Class C Principal Deficiency Sub Ledger is equal
to the aggregate Outstanding Principal Balance of the Class C
Notes;
(ii) Third, on the Class B Principal Deficiency Sub Ledger, until the
balance of the Class B Principal Deficiency Sub Ledger is equal
to the aggregate Outstanding Principal Balance of the Class B
Notes; and
(iii) last, on the Class A Principal Deficiency Sub Ledger, at which
point an Asset Trigger Event will have occurred.
9. RECORDS
The Current Issuer Cash Manager shall ensure that a separate record is kept
of any amount received from each of the Dollar Currency Swap Provider, the
Euro Currency Swap Provider and the Basis Rate Swap Provider pursuant to,
respectively, the Dollar Currency Swap Agreements, the Euro Currency Swap
Agreements and the Basis Rate Swap Agreement.
36
The Current Issuer Cash Manager hereby agrees that, each time the Current
Issuer Cash Manager records a debit on a Current Issuer Principal
Deficiency Sub Ledger, the Current Issuer Cash Manager shall also record on
such Current Issuer Principal Deficiency Sub Ledger whether such debit was
caused by (A) Losses on the Mortgage Loans which have been allocated by
Funding to the Current Issuer Intercompany Loan, (B) the application of
Current Issuer Available Principal Receipts to meet any deficiency in
Current Issuer Available Revenue Receipts, or (C) the application of
Funding Available Principal Receipts to fund the Current Issuer Liquidity
Reserve Fund, if any.
37
SCHEDULE 3
FORM OF ISSUER QUARTERLY REPORT
GRANITE MORTGAGES 02-2 PLC
PROFIT & LOSS ACCOUNT
PERIOD ENDED
This Quarter Prior Quarter
(pound) 000's (pound) 000's
Interest Receivable - Intercompany Loan
Interest Receivable - Cash Deposits/Authorised
Investments
----------------------------
0 0
Interest Payable - Notes
Interest Payable
----------------------------
0 0
----------------------------
Net Operating Income 0 0
Other Income
Operating Expenses
----------------------------
Profit/loss on ordinary activities before tax 0 0
Taxation
----------------------------
Profit/loss on ordinary activities after tax 0 0
Dividend 0 0
Retained profit brought forward 0 0
----------------------------
Retained profit for the year 0 0
============================
38
GRANITE MORTGAGES 02-2 PLC
BALANCE SHEET
PERIOD ENDED
(pound) 000's (pound) 000's
FIXED ASSET INVESTMENTS
Intercompany Lending 0
CURRENT ASSETS
Interest Receivable 0
Other debtors 0
Cash at Bank 0
Current Issuer Transaction Account:
---------------
0
---------------
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Accruals 0
Interest Payable Accrual 0
Taxation 0
---------------
0
---------------
Net current assets 0
CREDITORS: AMOUNTS FALLING DUE AFTER ONE YEAR
Amount due to Noteholders 0
-------------
Total Assets less current liabilities 0
=============
Share Capital 0
Reserves 0
-------------
0
=============
0
39
Current Issuer Notes to Balance Sheet:
Principal Deficiency Ledger
Class A Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
Class B Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
Class C Principal Deficiency Sub Ledger
Opening PDL Balance
Losses this Quarter
Amount of PDL top-up
Closing PDL Balance
40
GRANITE MORTGAGES 02-2 PLC
NOTES OUTSTANDING
PERIOD ENDED
SERIES 1 CLASS A1 SERIES 1 CLASS A2 SERIES 2 CLASS A SERIES 3 CLASS A
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
SERIES 1 CLASS B SERIES 2 CLASS B SERIES 3 CLASS B
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
SERIES 1 CLASS C SERIES 2 CLASS C SERIES 3 CLASS C SERIES 3 CLASS X
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
SERIES 1 CLASS A1 SERIES 1 CLASS A2 SERIES 2 CLASS A SERIES 3 CLASS A
Initial Note Balance
Previous Quarters Note
Principal
Note Redemptions
Outstanding Note Principal
SERIES 1 CLASS B SERIES 2 CLASS B SERIES 3 CLASS B
Initial Note Balance
Previous Quarters Note
Principal
Note Redemptions
Outstanding Note Principal
SERIES 1 CLASS C SERIES 2 CLASS C SERIES 3 CLASS C SERIES 3 CLASS D
Initial Note Balance
Previous Quarters Note
Principal
Note Redemptions
Outstanding Note Principal
SERIES 1 CLASS A SERIES 2 CLASS A SERIES 3 CLASS A
Note Interest Margins
Step Up Dates
Step Up Margins
SERIES 1 CLASS B SERIES 2 CLASS B SERIES 3 CLASS B
Note Interest Margins
Step Up Dates
Step Up Margins
SERIES 1 CLASS C SERIES 2 CLASS C SERIES 3 CLASS C SERIES 3 CLASS D
Note Interest Margins
Step Up Dates
Step Up Margins
Payment Cycle
Payment Date
Next Payment Date
Amount Credited to Principal
Deficiency Sub Ledger:
Current Quarter:
Aggregate:
41
SCHEDULE 4
CONTROLLED AMORTISATION AMOUNT/TARGET BALANCE
The "CONTROLLED AMORTISATION AMOUNT" for each Class of Current Issuer Notes for
any Payment Date set forth below is an amount not greater than the amount which
the Current Issuer would be required to repay in respect of such Class of
Current Issuer Notes so that on the relevant Payment Date the aggregate
Principal Amount Outstanding of such Class of Current Issuer Notes has been
reduced to (but is not less than) the "TARGET BALANCE" set out in the following
table:
--------------------------------------------------------------------------------------------------
PAYMENT DATE (POUND) TARGET $ TARGET (POUND) TARGET $ TARGET (POUND) TARGET $ TARGET
OCCURRING IN: BALANCE BALANCE BALANCE BALANCE BALANCE BALANCE
FOR SERIES FOR SERIES FOR SERIES FOR SERIES FOR FOR SERIES
1 CLASS A1 1 CLASS A1 1 CLASS A2 1 CLASS B SERIES 1 1 CLASS C
NOTES NOTES NOTES NOTES CLASS C NOTES
NOTES
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--------------------------------------------------------------------------------------------------
42
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PAYMENT DATE (POUND) TARGET (EURO) TARGET (POUND) TARGET (EURO) TARGET (POUND) TARGET (EURO) TARGET
OCCURRING IN: BALANCE BALANCE BALANCE BALANCE BALANCE BALANCE
FOR SERIES FOR SERIES FOR SERIES FOR SERIES FOR FOR SERIES
2 CLASS A 2 CLASS A 2 CLASS B 2 CLASS B SERIES 2 2 CLASS C
NOTES NOTES NOTES NOTES CLASS C NOTES
NOTES
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----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------
PAYMENT DATE (POUND)TARGET (POUND) TARGET (POUND) TARGET (POUND) TARGET
OCCURRING IN: BALANCE FOR BALANCE FOR BALANCE FOR BALANCE FOR
SERIES 3 SERIES 3 SERIES 3 SERIES 3
CLASS A CLASS B CLASS C CLASS D
NOTES NOTES NOTES NOTES
----------------------------------------------------------------------------
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----------------------------------------------------------------------------
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43
PROVIDED THAT on the Payment Date immediately following the Step-up Date in
respect of the Current Issuer and on each Payment Date thereafter:
(1) the Target Balance for the Series 1 Class A Notes will be zero; and
(2) the Target Balances for each other Class of Current Issuer Notes will be an
amount equal to the greater of:
(a) zero, and
(b) the aggregate Principal Amount Outstanding on such Class of Notes as
at the immediately preceding Payment Date (after taking into account
principal payments on such Payment Date) less an amount equal the
product of:
(i) the product of (A) the sum of the Mortgages Trustee Principal
Receipts for each Distribution Date since the immediately
preceding Payment Date, and (B) the Funding Share Percentage
applicable as at the later to occur of the immediately preceding
Assignment Date and the immediately preceding Distribution Date;
and
(ii) the quotient of (A) the Outstanding Principal Balance on such
Current Issuer's Intercompany Loan as at the immediately
preceding Payment Date (after taking into account principal
payments on such Payment Date) less the aggregate Outstanding
Principal Balances of the Special Repayment Notes of the Third
Issuer divided by (B) the aggregate Outstanding Principal Balance
on all Intercompany Loans as at the immediately preceding Payment
Date (after taking into account principal payments on such
Payment Date) less the aggregate amount of all Special Repayment
Notes; and
(iii) the quotient of (A) the aggregate Principal Amount Outstanding
on such Class of Notes as at the immediately preceding Payment
Date (after taking into account principal payments on such
Payment Date), divided by (B) the aggregate Principal Amount
Outstanding on all Classes of Notes of the Current Issuer (other
than Series 3 Class D Notes) as at the immediately preceding
Payment Date (after taking into account principal payments on
such Payment Date).
In addition, notwithstanding the foregoing, following the occurrence of a
Trigger Event, the Target Balance for the Series 3 Class D Notes will be
zero.
To the extent not repaid earlier, the full Principal Amount Outstanding on
a class of Current Issuer Notes will become due and payable on the legal
final maturity date of that class of Notes.
44
SCHEDULE 5
CURRENT ISSUER CASH MANAGER REPRESENTATIONS AND WARRANTIES
The Current Issuer Cash Manager makes the following representations and
warranties to each of the Mortgages Trustee, Funding and the Note Trustee:
1. STATUS: It is a public limited company duly incorporated, validly
existing and registered under the laws of the jurisdiction in which it
is incorporated, capable of being sued in its own right and not
subject to any immunity from any proceedings, and it has the power to
own its property and assets and to carry on its business as it is
being conducted.
2. POWERS AND AUTHORITY: It has the power to enter into, perform and
deliver, and has taken all necessary corporate and other action to
authorise the execution, delivery and performance by it of each of the
Transaction Documents to which it is or will be a party, and each such
Transaction Document has been duly executed and delivered by it.
3. LEGAL VALIDITY: Each Transaction Document to which it is or will be a
party constitutes or when executed in accordance with its terms will
constitute, a legal, valid and binding obligation.
4. NON-CONFLICT: The execution by it of each of the Transaction Documents
to which it is a party and the exercise by it of its rights and the
performance of its obligations under such Transaction Documents will
not:
(a) conflict with any document which is binding upon it or any of its
assets;
(b) conflict with its constitutional documents; or
(c) conflict with any law, regulation or official or judicial order
of any government, governmental body or court, domestic or
foreign, having jurisdiction over it.
5. NO LITIGATION: It is not a party to any material litigation,
arbitration or administrative proceedings and, to its knowledge, no
material litigation, arbitration or administrative proceedings are
pending or threatened against it.
6. CONSENTS AND LICENSES: All governmental consents, licences and other
approvals and authorisations required in connection with the entry
into, performance, validity and enforceability of, and the
transactions contemplated by, the Transaction Documents have been
obtained or effected (as appropriate) and are in full force and
effect.
7. SOLVENCY: No Insolvency Event has occurred in respect of the Current
Issuer Cash Manager, and the Current Issuer Cash Manager is not
insolvent.
8. FINANCIAL STATEMENTS: The most recent financial statements of the
Current Issuer Cash Manager:
45
(a) were prepared in accordance with accounting principles generally
accepted in England and Wales consistently applied;
(b) disclose all liabilities (contingent or otherwise) and all
unrealised and or anticipated losses of the Current Issuer Cash
Manager; and
(c) save as disclosed therein, give a true and fair view of the
financial condition and operations of the Current Issuer Cash
Manager during the relevant financial year.
9. NO ADVERSE CHANGE: Since the date as of which the most recent
financial statements of the Current Issuer Cash Manager were stated to
be prepared, there has been:
(a) no significant change in the financial position of the Current
Issuer Cash Manager; and
(b) no material adverse change in the financial position or prospects
of the Current Issuer Cash Manager.
10. RANKING OF CLAIMS
Under the laws of England and Wales in force as at the date of making
this representation, claims against the Current Issuer Cash Manager
under the Transaction Documents will rank at least pari passu with the
claims of all its other unsecured and unsubordinated creditors, save
those whose claims are preferred solely by any bankruptcy, liquidation
or other similar laws of general application.
11. INFORMATION IN PROSPECTUS AND OFFERING CIRCULAR:
All information in the Prospectus and the Offering Circular with
regard to the Current Issuer Cash Manager are true and accurate in all
material respects and not misleading in any material respect.
The Current Issuer Cash Manager has made all proper inquiries to ascertain and
to verify the foregoing.
46
EXECUTION PAGE
EXECUTED for and on behalf of )
NORTHERN ROCK PLC )
by: )
)
)
Name: )
Title:
EXECUTED for and on behalf of )
GRANITE MORTGAGES 02-2 PLC )
by: )
Name:
representing LDC SECURITISATION DIRECTOR NO 2 LIMITED
Title: DIRECTOR
EXECUTED for and on behalf of )
THE BANK OF NEW YORK )
by: )
Name:
Title:
