EXHIBIT 4.9
Dated 28 January 2004
NORTHERN ROCK PLC
as Current Issuer Cash Manager
GRANITE MORTGAGES 04-1 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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SIDLEY XXXXXX XXXXX & XXXX
0 XXXXXXXXXXXX XXXXXX
XXXXXX XX0X 0XX
TELEPHONE 000 0000 0000
FACSIMILE 020 7626 7937
Table of Contents
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Page
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1. Definitions and Interpretation.......................................1
2. Appointment of Current Issuer Cash Manager...........................2
3. The Current Issuer Cash Management Services..........................2
4. Payments, Accounts, Ledgers..........................................3
5. Payments Under Current Issuer Swap Agreements; Termination &
Swap Collateral......................................................6
6. No Liability........................................................10
7. Costs and Expenses..................................................10
8. Information.........................................................10
9. Remuneration........................................................12
10. Covenants, Representations and Warranties of Current Issuer
Cash Manager........................................................13
11. Current Issuer Cash Management Services Non-Exclusive...............14
12. Termination.........................................................14
13. Further Assurances..................................................17
14. Miscellaneous.......................................................17
15. Confidentiality.....................................................18
16. No Partnership......................................................19
17. Assignment..........................................................19
18. The Note Trustee....................................................19
19. Non Petition Covenant; Limited Recourse.............................20
20. Amendments and Waiver...............................................21
21. Notices.............................................................21
22. Third Party Rights..................................................22
23. Execution in Counterparts; Severability.............................22
24. Governing Law and Jurisdiction; Appropriate Forum...................22
SCHEDULE 1 The Current Issuer Cash Management Services...................24
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Table of Contents
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(continued)
Page
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SCHEDULE 2 Cash Management and Maintenance of Ledgers....................27
SCHEDULE 3 Form of Issuer Quarterly Report...............................49
SCHEDULE 4 Controlled Amortisation Amount/Target Balance.................54
SCHEDULE 5 Current Issuer Cash Manager Representations and
Warranties....................................................60
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THIS ISSUER CASH MANAGEMENT AGREEMENT is made on 28 January 2004
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 04-1 PLC (registered number 4959572), a public limited
company incorporated under the laws of England and Wales whose
registered office is at Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx XX0X 0XX as
the Current Issuer; and
(3) THE BANK OF NEW YORK, whose principal office is at 00xx Xxxxx, Xxx
Xxxxxx Xxxxxx, Xxxxxx X00 0XX, in its capacity as Note Trustee.
WHEREAS:
(A) On the Closing Date the Current Issuer will issue the Current Issuer
Notes constituted by the Current Issuer Trust Deed. From the proceeds of
the issue of those Current Issuer Notes, the Current Issuer shall make
an Intercompany Loan to Granite Finance Funding Limited pursuant to the
terms of the Current Issuer Intercompany Loan Agreement.
(B) The Current Issuer Cash Manager is willing to provide cash management
services to the Current Issuer and the Note Trustee on the terms and
subject to the conditions contained in this Agreement.
IT IS HEREBY AGREED as follows:
1. Definitions and Interpretation
1.1 The provisions of:
(a) the Master Definitions Schedule as amended and restated by (and
appearing in Appendix 1 to) the Master Definitions Schedule
Seventh Amendment Deed made on 26 January 2004 between, among
others, the 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
28 January 2004,
(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.
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2. Appointment of Current Issuer Cash Manager
2.1 Appointment: Until termination pursuant to Clause 12 (Termination), the
Current Issuer and the Note Trustee (according to their respective
estates and interests) each hereby appoints the Current Issuer Cash
Manager as its lawful agent on each of their behalves to provide the
Current Issuer Cash Management Services set out in this Agreement,
including in relation to the Current Issuer Notes to be issued by the
Current Issuer. The Current Issuer Cash Manager in each case hereby
accepts such appointment on the terms and subject to the conditions of
this Agreement.
2.2 Duties prescribed by Transaction Documents: For the avoidance of doubt
and in connection with the powers conferred under Clause 2.1
(Appointment), save as expressly provided elsewhere in this Agreement,
nothing herein shall be construed so as to give the Current Issuer Cash
Manager any powers, rights, authorities, directions or obligations other
than as specified in this Agreement or any of the other Transaction
Documents.
2.3 Appointment conditional upon issuance of Current Issuer Notes: The
appointment pursuant to Clause 2.1 (Appointment) is conditional upon the
issue of the Current Issuer Notes and the making of the Current Issuer
Intercompany Loan under the Current Issuer Intercompany Loan Agreement
and shall take effect upon and from the Closing Date automatically
without any further action on the part of any person, PROVIDED THAT if
the issue of the Current Issuer Notes has not occurred by 31 January
2004, 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 use reasonable endeavours to 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
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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).
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;
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(iii) the Current Issuer Principal Deficiency Ledger, which shall
comprise four sub-ledgers to be known as the Class A
Principal Deficiency Sub Ledger, the Class B Principal
Deficiency Sub Ledger, the Class M Principal Deficiency Sub
Ledger and the Class C Principal Deficiency Sub Ledger, and
which shall record (A) any principal deficiencies arising
from Losses on the Mortgage Loans which have been allocated
by Funding to the Current Issuer Intercompany Loan, (B) the
application of Current Issuer Principal Receipts to meet any
deficiency in Current Issuer Revenue Receipts, (C) the
application of Funding Available Principal Receipts to fund
the Current Issuer Liquidity Reserve Fund and (D) the
application of Current Issuer Available Revenue Receipts to
be applied to reduce the balances on the Current Issuer
Principal Deficiency Ledger; and
(iv) the Swap Collateral Ledger, (which shall comprise of such
sub-ledgers as the Current Issuer Cash Manager considers
appropriate) to record all payments, transfers and receipts
in connection with Swap Collateral, including, without
limitation:
(A) the receipt of any Swap Collateral by the Current
Issuer from the Swap Providers;
(B) the receipt of any income or distributions in respect
of such Swap Collateral;
(C) the payment or transfer of all, or any part of, such
Swap Collateral to the relevant Current Issuer Swap
Provider; and
(D) the realisation of such Swap Collateral,
provided that the Swap Collateral Ledger (and sub-ledgers)
shall only be established in the event that any Current
Issuer Swap Provider pays or transfers Swap Collateral to
the Issuer in accordance with the relevant Current Issuer
Swap Agreement.
(b) The Current Issuer Cash Manager shall make credits and debits to
the Current Issuer Ledgers in accordance with the provisions of
paragraphs 5, 6, 7, 8, 9 and 10 of Schedule 2 hereto.
4.3 Payments:
(a) The Current Issuer Cash Manager shall procure that the following
amounts payable to the Current Issuer are paid into the Current
Issuer Transaction Accounts:
(i) all Current Issuer Revenue Receipts;
(ii) all Current Issuer Principal Receipts;
(iii) all amounts (excluding Swap Collateral Excluded Amounts)
received by the Current Issuer pursuant to the Current
Issuer Swap Agreements; and
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(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 and Swap Collateral Accounts shall be
made in accordance with the provisions of the Current Issuer Bank
Account Agreement and the Current Issuer Deed of Charge.
(c) Each of the payments into the Current Issuer Transaction Accounts
referred to in Clause 4.3(a) shall be made forthwith upon receipt
by the Current Issuer or the Current Issuer Cash Manager of the
amount in question.
(d) For the avoidance of doubt, as soon as reasonably practicable
after becoming aware of the same, the Current Issuer Cash Manager
may, and shall, withdraw Cash from the Current Issuer Transaction
Accounts and Swap Collateral Cash Accounts, if, and to the extent
that, such Cash was credited thereto in error and shall use its
reasonable endeavours to ensure that such Cash is applied
correctly thereafter.
(e) The Current Issuer Cash Manager shall promptly notify each of the
Current Issuer and the Note Trustee of any additional account or
sub-account which supplements or replaces any account or
sub-account specifically referred to in the definition of the
"Current Issuer Transaction Accounts" in the Current Issuer Master
Definitions Schedule.
(f) Each of the Current Issuer Cash Manager and the Current Issuer
undertakes that, so far as it is able to procure the same, the
Current Issuer Transaction Accounts and all instructions and
mandates in relation thereto will continue to be operative and
will not, save as permitted pursuant to the Current Issuer Bank
Account Agreement, be changed without the prior written consent of
the Note Trustee (such consent not to be unreasonably withheld or
delayed). For the avoidance of doubt, the Current Issuer Cash
Manager may change the authorised signatories in respect of any
instructions or mandates relating to the Current Issuer, without
the prior written consent of the Note Trustee, in accordance with
the terms of the Current Issuer Bank Account Agreement.
4.4 Withdrawals:
(a) The Current Issuer Cash Manager may make withdrawals on behalf of
the Current Issuer from the Current Issuer Transaction Accounts
(but only until receipt of a copy of a Current Issuer Note
Enforcement Notice served by the Note Trustee on the Current
Issuer) and Swap Collateral Accounts as
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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 and Swap
Collateral Accounts.
(b) Upon receipt of such a Current Issuer Note Enforcement Notice, no
amount shall be withdrawn from any Current Issuer Transaction
Account by the Current Issuer Cash Manager without the prior
written consent of the Note Trustee.
4.5 Cash Management: In administering the Current Issuer Transaction
Accounts on behalf of the Current Issuer and the Note Trustee, the
Current Issuer Cash Manager shall comply with the provisions of Schedule
2 prior to receipt by the Current Issuer Cash Manager of a copy of any
Current Issuer Note Enforcement Notice served on the Current Issuer.
Following service of a Current Issuer Note Enforcement Notice, the Note
Trustee or any Receiver appointed by the Note Trustee will administer
the Current Issuer Transaction Accounts in accordance with the terms of
the Current Issuer Deed of Charge.
5. Payments Under Current Issuer Swap Agreements; Termination & Swap
Collateral
5.1 Current Issuer Available Revenue Receipts: Subject to the order of
priorities of payment set out in Schedule 2 or, as the case may be, the
Current Issuer Deed of Charge, on each Payment Date prior to the
enforcement of the Current Issuer Security under the Current Issuer Deed
of Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Revenue Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to the Current Issuer Basis Rate Swap Provider.
Amounts received by the Current Issuer Cash Manager from the Current
Issuer Basis Rate Swap Provider will be applied to pay (1) in respect of
the Dollar Notes, the Current Issuer Dollar Currency Swap Provider, and
amounts received by the Current Issuer Cash Manager from the Current
Issuer Dollar Currency Swap Provider will be applied to pay amounts due
to the holders of the relevant classes of Dollar Notes in accordance
with the Current Issuer Pre-Enforcement Revenue Priority of Payments,
(2) in respect of the Sterling Notes, 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
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Swap Provider, and amounts received by the Current Issuer Cash Manager
from the Current Issuer Dollar Currency Swap Provider will be applied to
pay amounts due to the holders of the relevant classes of Dollar Notes
in accordance with the Current Issuer Pre-Enforcement Principal Priority
of Payments, (2) in respect of the Sterling Notes, amounts due to the
holders of the relevant classes of Sterling Notes in accordance with the
Current Issuer Pre-Enforcement Principal Priority of Payments, and (3)
in respect of the Euro Notes, the Current Issuer Euro Currency Swap
Provider, and amounts received by the Current Issuer Cash Manager from
the Current Issuer Euro Currency Swap Provider will be applied to pay
amounts due to the holders of the relevant classes of Euro Notes in
accordance with the Current Issuer Pre-Enforcement Principal Priority of
Payments.
5.3 Following a Non-Asset Trigger Event: On each Payment Date following the
occurrence of a Non-Asset Trigger Event under the Mortgages Trust Deed
but prior to enforcement of the Funding Security under the Funding Deed
of Charge or the Current Issuer Security under the Current Issuer Deed
of Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Principal Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to (1) in respect of the Dollar Notes, the Current
Issuer Dollar Currency Swap Provider, and amounts received by the
Current Issuer Cash Manager from the Current Issuer Dollar Currency Swap
Provider will be applied to pay amounts due to the holders of the
relevant classes of Dollar Notes, and (2) in respect of the Sterling
Notes, amounts due to the holders of the relevant classes of Sterling
Notes, and (3) in respect of the Euro Notes, the Current Issuer Euro
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Euro Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of
Euro Notes, each in accordance with the priority of payments set forth
in Clause 4.2 (Distribution of Current Issuer Available Principal
Receipts Following the Occurrence of a Non-Asset Trigger Event) of
Schedule 2.
5.4 Following an Asset Trigger Event: On each Payment Date following the
occurrence of an Asset Trigger Event under the Mortgages Trust Deed but
prior to enforcement of the Funding Security under the Funding Deed of
Charge or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will pay Current Issuer
Available Principal Receipts received in respect of the Current Issuer
Intercompany Loan (after making payments ranking higher in the order or
priority of payments) to (1) in respect of the Dollar Notes, the Current
Issuer Dollar Currency Swap Provider, and amounts received by the
Current Issuer Cash Manager from the Current Issuer Dollar Currency Swap
Provider will be applied to pay amounts due to the holders of the
relevant classes of Dollar Notes, and (2) in respect of the Sterling
Notes, amounts due to the holders of the relevant classes of Sterling
Notes, and (3) in respect of the Euro Notes, the Current Issuer Euro
Currency Swap Provider, and amounts received by the Current Issuer Cash
Manager from the Current Issuer Euro Currency Swap Provider will be
applied to pay amounts due to the holders of the relevant classes of
Euro Notes, each in accordance with the priority of payments set forth
in Clause 4.3 (Distribution of Current Issuer Available Principal
Receipts Following the Occurrence of an Asset Trigger Event) of Schedule
2.
5.5 Termination: If on or prior to the date of the earlier of (i) repayment
in full of the
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Current Issuer Notes or (ii) the service of a Current Issuer Note
Enforcement Notice, any of the Current Issuer Swap Agreements is
terminated, the Current Issuer Cash Manager (on behalf of the Current
Issuer and the Note Trustee) shall purchase a replacement hedge, as
applicable, in respect of the relevant Series of Current Issuer Notes in
each case on terms acceptable to the Rating Agencies, the Current Issuer
and the Note Trustee and with a swap provider that the Rating Agencies
have previously confirmed in writing to the Current Issuer and the Note
Trustee will not cause the then-current ratings of the Current Issuer
Notes to be downgraded, withdrawn or qualified. The Current Issuer may
apply any early termination payment received from, as appropriate, the
relevant Current Issuer Swap Provider for such purpose.
5.6 Swap Collateral:
(a) In the event that pursuant to the terms of a Current Issuer Swap
Agreement a Current Issuer Swap Provider pays or transfers Swap
Collateral to the Current Issuer, the Current Issuer Cash Manager
shall:
(i) create the Swap Collateral Ledger in the books of the
Current Issuer if not already created so as to record the
amount and type of such Swap Collateral and identify the
relevant Current Issuer Swap Agreement in respect of which
it has been posted;
(ii) upon receipt of such Swap Collateral, credit it to and
record the relevant details in the Swap Collateral Ledger;
(iii) to the extent that such Swap Collateral is in the form of
Cash, pay it into the relevant Swap Collateral Cash Account;
and
(iv) to the extent that such Swap Collateral is in the form of
securities, arrange for it to be credited to the relevant
Swap Collateral Securities Account.
(b) Any such Swap Collateral shall not form part of the Current Issuer
Available Revenue Receipts and the Current Issuer Available
Principal Receipts. If the terms of the relevant Current Issuer
Swap Agreement permit such Swap Collateral to be applied in or
towards satisfaction of the Current Issuer's Swap Provider's
obligations under the relevant Current Issuer Swap Agreement, and
in the event that such Swap Collateral is to be so applied, the
Current Issuer Cash Manager shall:
(i) where the relevant Swap Collateral is in the form of Cash,
transfer the relevant amount of Cash from the relevant Swap
Collateral Cash Account to the relevant Current Issuer
Transaction Account; and/or
(ii) where the relevant Swap Collateral is in the form of
securities, realise the Swap Collateral and pay the amount
of the net proceeds into the relevant Current Issuer
Transaction Account,
and, in each case, make the appropriate debits and credits to the
Swap Collateral Ledger, apply such amount as if it had been paid
to the Current
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Issuer by the Current Issuer Swap Provider under the relevant
Current Issuer Swap Agreement and make appropriate ledger entries.
(c) To the extent that pursuant to the terms of the relevant Current
Issuer Swap Agreement Swap Collateral is to be transferred or paid
to the Current Issuer Swap Provider, the Current Issuer Cash
Manager shall:
(i) where the relevant Swap Collateral is in the form of Cash,
pay the relevant amount of Cash out of the relevant Swap
Collateral Cash Account to the Current Issuer Swap Provider;
and/or
(ii) where the relevant Swap Collateral is in the form of
securities, transfer and deliver the Swap Collateral to the
Current Issuer Swap Provider,
and, in each case, debit the Swap Collateral Ledger as
appropriate.
(d) Where:
(i) Swap Collateral is to be applied in satisfaction of the
Current Issuer Swap Provider's obligations under the
relevant Current Issuer Swap Agreement; and
(ii) such Swap Collateral or the proceeds of such Swap Collateral
are in a different currency to the currency (the "Required
Currency") in which such obligations of the Current Issuer
Swap Provider are payable,
then, the Current Issuer Cash Manager shall arrange for such Swap
Collateral to be converted (by such person as the Current Issuer
Cash Manager may reasonably select) at the prevailing spot rate of
exchange into the Required Currency.
(e) The terms of this Clause 5.6 shall prevail if and to the extent
that they are inconsistent with the other paragraphs of this
Clause 5.
5.7 Interest Payment Dates: Prior to the enforcement of the Current Issuer
Security under the Current Issuer Deed of Charge, any amount received by
the Current Issuer Cash Manager from any Current Issuer Currency Swap
Provider on an Interest Payment Date (which is not a Payment Date) will
be applied on such Interest Payment Date to pay the persons to whom it
would have been applied had it been received by the Current Issuer Cash
Manager on a Payment Date.
5.8 Spot Rate Conversions: In the event that any payment is to be made from
the Current Issuer Available Revenue Receipts or the Current Issuer
Available Principal Receipts by the Current Issuer under the Current
Issuer Priority of Payments and the Current Issuer Available Revenue
Receipts or the Current Issuer Available Principal Receipts, as
applicable, do not comprise a sufficient amount in the relevant currency
in which such payment is to be made, the Current Issuer Cash Manager
shall arrange for any remaining amounts comprised in the Current Issuer
Available Revenue Receipts or the Current Issuer Available Principal
Receipts, as applicable, to be converted (by such person as the Current
Issuer Cash Manager may reasonably select) into such currency at the
then prevailing spot rate of exchange as may be required in order to be
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applied in or towards such payment.
6. No Liability
Save as otherwise provided in this Agreement, the Current Issuer Cash
Manager shall have no liability for the obligations of either the Note
Trustee or the Current Issuer under any of the Transaction Documents or
otherwise and nothing herein shall constitute a guarantee, or similar
obligation, by the Current Issuer Cash Manager of either the Note
Trustee or the Current Issuer in respect of any of them.
7. Costs and Expenses
7.1 Subject to and in accordance with the Current Issuer Pre-Enforcement
Priority of Payments or, as the case may be, the Current Issuer
Post-Enforcement Priority of Payments, the Current Issuer will on each
Payment Date reimburse the Current Issuer Cash Manager for all
out-of-pocket costs, expenses and charges (together with any amounts in
respect of Irrecoverable VAT due thereon) properly incurred by the
Current Issuer Cash Manager in the performance of the Current Issuer
Cash Management Services, including any such costs, expenses or charges
not reimbursed to the Current Issuer Cash Manager on any previous
Payment Date and the Current Issuer Cash Manager shall supply the
Current Issuer with an appropriate VAT invoice issued by the Current
Issuer Cash Manager or, if the Current Issuer Cash Manager has treated
the relevant cost, expense or charge as a disbursement for VAT purposes,
by the person making the supply.
7.2 Unless and until otherwise agreed by the Current Issuer and the Note
Trustee in writing (notified to the Current Issuer Cash Manager), the
Current Issuer shall be solely responsible for reimbursing the Current
Issuer Cash Manager for the out-of-pocket costs, expenses and charges
(together with any amounts in respect of Irrecoverable VAT due thereon)
referred to in Clause 7.1 (Costs and Expenses).
8. Information
8.1 Use of information technology systems:
(a) The Current Issuer Cash Manager represents and warrants that at
the date hereof (and in respect of the software which is to be
used by the Current Issuer Cash Manager in providing the Current
Issuer Cash Management Services) it has in place all necessary
licences and/or consents from the respective licensor or licensors
(if any) of such software.
(b) The Current Issuer Cash Manager undertakes that it shall for the
duration of this Agreement, use reasonable endeavours to:
(i) ensure that the licences and/or consents referred to in
paragraph (a) are maintained in full force and effect; and
(ii) except insofar as it would breach any other of its legal
obligations, grant to any person to whom it may sub-contract
or delegate the performance of all or any of its powers and
obligations under this Agreement (and/or to such person as
the Current Issuer and the Note
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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.
8.2 Bank Account Statements: The Current Issuer Cash Manager shall take all
reasonable steps to ensure that it receives a monthly bank statement in
relation to each Current Issuer Transaction Account and Swap Collateral
Cash Account and that it furnishes a copy of such statements to the
Current Issuer, with a copy to the Note Trustee upon its request.
8.3 Access to Books and Records: Subject to all applicable laws, the Current
Issuer Cash Manager shall permit the Current Issuer, the Auditors of the
Current Issuer, the Note Trustee and/or any other person nominated by
the Note Trustee (to whom the Current Issuer Cash Manager has no
reasonable objection) at any time during normal office hours upon
reasonable notice to have access, or procure that such person or persons
are granted access, to all books of record and account relating to the
Current Issuer Cash Management Services provided by the Current Issuer
Cash Manager and related matters in accordance with this Agreement.
8.4 Statutory Obligations: The Current Issuer Cash Manager will use its
reasonable endeavours, on behalf of the Current Issuer, to prepare or
procure the preparation of and file all reports, annual returns,
financial statements, statutory forms and other returns which the
Current Issuer is required by law to prepare and file. Subject to
approval thereof by the directors of the Current Issuer, the Current
Issuer Cash Manager shall cause such accounts to be audited by the
Auditors and shall procure so far as it is able so to do that the
Auditors shall make a report thereon as required by law, and copies of
all such documents shall be delivered to the Note Trustee, the Current
Issuer and the Rating Agencies as soon as practicable after the end of
each accounting reference period of the Current Issuer.
8.5 Information Covenants:
(a) The Current Issuer Cash Manager shall provide the Current Issuer,
the Note Trustee, the Seller and the Rating Agencies quarterly
with a report in, or substantially in, the form set out in
Schedule 3 in respect of the Current Issuer. Such quarterly report
shall be delivered to the Current Issuer, the Note Trustee (upon
its request), the Seller and the Rating Agencies by the last
Business Day of the month in which each Payment Date occurs.
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(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
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
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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.
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
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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 ("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.
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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 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.
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(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;
(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
16
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 receive payment of all
amounts (if any) due to it from the Current Issuer other than
under this Agreement.
(d) Any provision of this Agreement, which is stated to continue after
termination of the Agreement, shall remain in full force and
effect notwithstanding termination.
13. Further Assurances
13.1 Co-operation, etc: The parties hereto agree that they will co-operate
fully to do all such further acts and things and execute any further
documents as may be necessary or desirable to give full effect to the
arrangements contemplated by this Agreement and the other Transaction
Documents.
13.2 Powers of attorney: Without prejudice to the generality of Clause 13.1
(Co-operation, etc), the Current Issuer shall upon request by the
Current Issuer Cash Manager forthwith give to the Current Issuer Cash
Manager such further powers of attorney or other written authorisations,
mandates or instruments as are necessary to enable the Current Issuer
Cash Manager to perform the Current Issuer Cash Management Services.
14. Miscellaneous
14.1 No set-off: The Current Issuer Cash Manager agrees that it will not:
(a) set off or purport to set off any amount which either the Current
Issuer is or will become obliged to pay to it under this Agreement
against any amount from time to time standing to the credit of or
to be credited to the Current Issuer Transaction Accounts or the
Swap Collateral Accounts or any replacement or additional bank
account of the Current Issuer and established from time to time;
or
(b) make or exercise any claims or demands, any rights of counterclaim
or any other equities against or withhold payment of any and all
sums of money which may at any time and from time to time standing
to the credit of the
17
Current Issuer Transaction Accounts or the Swap Collateral
Accounts or any replacement or additional bank account of the
Current Issuer and established from time to time.
14.2 No recourse:
(a) In relation to all sums due and payable by the Current Issuer to
the Current Issuer Cash Manager, the Current Issuer Cash Manager
agrees that it shall have recourse only to sums paid to or
received by (or on behalf of) the Current Issuer pursuant to the
provisions of the Current Issuer Transaction Documents.
(b) For the avoidance of doubt, the Note Trustee shall not be liable
to pay any amounts due under Clauses 7 (Costs and Expenses) and 9
(Remuneration), but without prejudice to the obligations of the
Current Issuer, or any receiver appointed pursuant to the Current
Issuer Deed of Charge in respect of such amounts.
(c) Notwithstanding any other provisions of this Agreement, all
obligations to, and rights of, the Note Trustee under or in
connection with this Agreement (other than its obligations under
Clause 13 (Further Assurances)) shall automatically terminate upon
the discharge in full of all Current Issuer Secured Obligations,
PROVIDED THAT this shall be without prejudice to any claims in
respect of such obligations and rights arising on or prior to such
date.
15. Confidentiality
During the continuance of this Agreement or after its termination, each
of the Current Issuer, the Current Issuer Cash Manager and the Note
Trustee shall use its best endeavours not to disclose to any person,
firm or company whatsoever any information relating to the business,
finances or other matters of a confidential nature of any other party
hereto of which it may exclusively by virtue of being party to the
Transaction Documents have become possessed and shall use all reasonable
endeavours to prevent any such disclosure as aforesaid, PROVIDED HOWEVER
that the provisions of this Clause 15 shall not apply:
(a) to any information already known to the recipient otherwise than
as a result of entering into any of the Transaction Documents;
(b) to any information subsequently received by the recipient which it
would otherwise be free to disclose;
(c) to any information which is or becomes public knowledge otherwise
than as a result of the conduct of the recipient;
(d) to any extent that the recipient is required to disclose the same
pursuant to any law or order of any court or pursuant to any
direction, request or requirement (whether or not having the force
of law) of any central bank or any governmental or other authority
(including, without limitation, any official bank examiners or
regulators);
18
(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.
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
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 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
20
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.
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 04-1 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;
21
(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 the Head of
Monitoring Group, Structured Finance;
(f) in the case of S&P, to Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., at Xxxxxx Xxxxx, 00
Xxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number 0207 826 3598)
for the attention of Xxxxx Xxxxxxxx;
or to such other address or facsimile number or for the attention of
such other person or entity as may from time to time be notified by any
party or by any Rating Agency to the others by written notice in
accordance with the provisions of this Clause 21. All notices served
under this Agreement shall be simultaneously copied to the Note Trustee
by the person serving the same.
22. Third Party Rights
A person who is not a party to this Agreement may not enforce any of its
terms under the Contracts (Rights of Third Parties) Xxx 0000, but this
shall not affect any right or remedy of a third party which exists or is
available apart from that Act.
23. Execution in Counterparts; Severability
23.1 Counterparts: This Agreement may be executed in any number of
counterparts (manually or by facsimile) and by different parties hereto
in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute
one and the same instrument.
23.2 Severability: Where any provision in or obligation under this Agreement
shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations under this Agreement, or of such provision or obligation in
any other jurisdiction, shall not be affected or impaired thereby.
24. Governing Law and Jurisdiction; Appropriate Forum
24.1 Governing Law: This Agreement is governed by, and shall be construed
in accordance with, English law.
24.2 Jurisdiction: Each of the parties hereto irrevocably agrees that the
courts of England shall have jurisdiction to hear and determine any
suit, action or proceeding, and to settle any disputes, which may arise
out of or in connection with this Agreement and, for such purposes,
irrevocably submits to the jurisdiction of such courts.
22
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.
23
SCHEDULE 1
The Current Issuer Cash Management Services
The Current Issuer Cash Manager shall:
(a) make the determinations as set forth in Schedule 2;
(b) invest sums, if any, standing to the credit of the Current Issuer
Transaction Accounts in short-term Authorised Investments as determined
by the Current Issuer and, if applicable, the Note Trustee;
(c) apply the Current Issuer Available Revenue Receipts and Current Issuer
Available Principal Receipts in accordance with the relevant order of
priority of payments for the Current Issuer set out in Schedule 2;
(d) maintain the Current Issuer Principal Deficiency Ledger, and record (1)
principal deficiencies arising from Losses on the Mortgage Loans which
have been allocated by Funding to the Current Issuer Intercompany Loan,
(2) the use of Current Issuer Principal Receipts to meet any deficiency
in Current Issuer Revenue Receipts and (3) the use of Funding Available
Principal Receipts to fund or replenish, as the case may be, the Current
Issuer Liquidity Reserve Fund, if any, and (4) the application of
Current Issuer Available Revenue Receipts to reduce the balances on the
Current Issuer Principal Deficiency Ledger;
(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, and (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;
24
(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 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
25
from which moneys were withdrawn to make the relevant Authorised
Investment; and
(iv) following the enforcement of the Current Issuer Security no such
investment may be made without the prior written consent of the
Note Trustee.
The Note Trustee and the Current Issuer Cash Manager shall not be
responsible (save where any loss results from the Note Trustee's or the
Current Issuer Cash Manager's own fraud, wilful default or gross
negligence or that of its officers or employees) for any loss occasioned
by reason of any such Authorised Investments whether by depreciation in
value or otherwise provided that such Authorised Investments were made
in accordance with the above provisions;
(p) (i) if necessary, perform all currency conversions free of charge,
cost or expense at the relevant exchange rate; and
(ii) if necessary, perform all interest rate conversions free of
charge, cost or expense at the relevant interest swap rate.
for the purposes of any calculations referred to in sub-paragraphs (i)
and (ii) above, all percentages resulting from such calculations will be
rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point (e.g. 9.876541% (or 0.09876541) being rounded down to
9.87654% (or 0.0987654)) and (ii) any currency amounts used in or
resulting from such calculations will be rounded in accordance with the
relevant market practice;
(q) arrange payment of all fees to the London Stock Exchange plc or, as
applicable, the UK Listing Authority; and
(r) provide services in relation to Swap Collateral (including, without
limitation, in connection with the transfer, receipt, administration
and/or holding of Swap Collateral, the making of calculations,
determinations, communications or valuations, the opening and
maintenance of the Swap Collateral Accounts and the Swap Collateral
Ledger; and the entering into of Swap Collateral Ancillary Documents).
26
SCHEDULE 2
Cash Management and Maintenance of Ledgers
1. Determination
(a) On or before each Current Issuer Note Determination Date
immediately preceding a Payment Date, the Current Issuer Cash
Manager shall determine each of the following in accordance with
this paragraph 1:
(i) the amount of any Current Issuer Available Revenue Receipts
to be applied on the following Payment Date in accordance
with the Current Issuer Pre-Enforcement Revenue Priority of
Payments set forth in paragraph 3 of this Schedule 2;
(ii) the amount of any Current Issuer Available Principal
Receipts to be applied on the following Payment Date in
accordance with the Current Issuer Pre-Enforcement Principal
Priority of Payments set forth in paragraph 4 of this
Schedule 2;
(iii) whether there will be an excess or a deficit of the Current
Issuer Available Revenue Receipts to pay items (A) through
(P) of the Current Issuer Pre-Enforcement Revenue Priority
of Payments (after taking account of any Group 1 Shared
Issuer Revenue Receipts or Group 2 Shared Issuer Revenue
Receipts available therefor) as set forth in paragraph 3 of
this Schedule 2;
(iv) the various amounts, balances and rates to be calculated in
accordance with the Current Issuer Swap Agreements, and
shall promptly notify the Current Issuer, the Note Trustee
and each Calculation Agent (as defined in each Current
Issuer Swap Agreement) of such amounts, balances and rates;
and
(v) the Principal Amount Outstanding of the Current Issuer
Notes, the Pool Factor, and the Note Principal Payment of
the Current Issuer Notes in accordance with the Conditions.
(b) If the Current Issuer Cash Manager determines (as set forth in
paragraph 1(a)(iii)) that there is a Current Issuer Income Deficit
and the Current Issuer has provided for that deficit by the
application of funds standing to the credit of the Current Issuer
Principal Ledger, if any, then the Current Issuer Cash Manager
shall make a corresponding debit entry in the relevant Current
Issuer Principal Deficiency Sub Ledger, PROVIDED THAT the Current
Issuer Cash Manager shall ensure that Current Issuer Principal
Receipts are not used to pay interest on any class of Current
Issuer Notes if and to the extent that would result in a
deficiency being recorded, or an existing deficiency being
increased, on a Current Issuer Principal Deficiency Sub Ledger
relating to a higher ranking Class of Current Issuer Notes, and
furthermore that Current Issuer Principal Receipts are not used to
make up any deficit other than in respect of items (A) through
(E), (G), (I) and (K) of the Current Issuer Pre-
27
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 provisions of a higher
priority have been made in full) (the "Current Issuer Pre-Enforcement
Revenue Priority of Payments"):
28
(A) first, to pay amounts due to the Note Trustee, together with
interest and (to the extent not already inclusive) VAT on those
amounts, and to provide for any amounts due or to become due
during the following Interest Period to the Note Trustee under the
Current Issuer Trust Deed, the Current Issuer Deed of Charge or
any other Transaction Document;
(B) second, in no order of priority among 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 among 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 among them but in proportion to the
respective amounts due, to pay:
(1) amounts (including such part of any termination payment) due
to the Current Issuer Basis Rate Swap Provider (except for
any termination payment or any part thereof due and payable
to the Current Issuer Basis Rate Swap Provider as a result
of a Basis Rate Swap Provider Default, save to the extent
such termination payment may be satisfied by any Swap
Replacement Payment received by the Current Issuer following
a Downgrade Termination Event and applied in accordance with
this order of priority of payments);
29
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A1 Dollar
Currency Swap Provider under the Series 1 Class A1 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 1 Class A1
Dollar Currency Swap Provider to pay on such Interest
Payment Date interest due or overdue on the Series 1 Class
A1 Notes to holders of the Series 1 Class A1 Notes; and
(3) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class A2 Dollar
Currency Swap Provider under the Series 1 Class A2 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 1 Class A2
Dollar Currency Swap Provider to pay on such Interest
Payment Date 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 A1 Dollar
Currency Swap Provider under the Series 2 Class A1 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent that such termination
payment may be satisfied by any Swap Replacement Payment
received by the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order
of priority of payments) and from amounts received on each
Interest Payment Date in respect of interest from the Series
2 Class A1 Dollar Currency Swap Provider to pay on such
Interest Payment Date interest due or overdue on the Series
2 Class A1 Notes;
(5) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class A2 Euro
Currency Swap Provider under the Series 2 Class A2 Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event and
applied in
30
accordance with this order of priority of payments) and from
amounts received on each Interest Payment Date in respect of
interest from the Series 2 Class A2 Euro Currency Swap
Provider to pay on such Interest Payment Date interest due
or overdue on the Series 2 Class A2 Notes to the holders of
the Series 2 Class A2 Notes; and
(6) amounts due to pay on each Interest Payment Date interest
due or overdue on the Series 3 Class A Notes to the holders
of the Series 3 Class A Notes;
(F) sixth, towards a credit to the Class A Principal Deficiency Sub
Ledger in an amount up to the amount necessary to eliminate any
debit on the Class A Principal Deficiency Sub Ledger;
(G) seventh, in no order of priority among them but in proportion to
the respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class B Dollar
Currency Swap Provider under the Series 1 Class B Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 1 Class B Dollar
Currency Swap Provider to pay on such Interest Payment Date
interest due or overdue on the Series 1 Class B Notes to the
holders of the Series 1 Class B Notes;
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class B Euro
Currency Swap Provider under the Series 2 Class B Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 2 Class B Euro
Currency Swap Provider to pay on such Interest Payment Date
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 on each Interest Payment Date interest
due or overdue on the Series 3 Class B Notes to the holders
of the Series 3 Class B Notes.
31
(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 or priority among 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 M Dollar
Currency Swap Provider under the Series 1 Class M Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any swap replacement payment received by
the Current Issuer following a Downgrade Termination Event
in respect of the Series 1 Class M Dollar Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 1 Class M Dollar
Currency Swap Provider to pay on such Interest Payment Date
interest due or overdue on the Series 1 Class M Notes to the
holders of the Series 1 Class M Notes;
(2) amounts due in respect of interest and such part of any
termination payment due to the Series 2 Class M Euro
Currency Swap Provider under the Series 2 Class M Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event in
respect of the Series 2 Class M Euro Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 2 Class M Euro
Currency Swap Provider to pay on such Interest Payment Date
interest due or overdue on the Series 2 Class M Notes to the
holders of the Series 2 Class M Notes; and
(3) amounts due to pay on each Interest Payment Date interest
due or overdue on the Series 3 Class M Notes to the holders
of the Series 3 Class M Notes;
(J) tenth, to credit to the Class M Principal Deficiency Sub Ledger in
an amount up to the amount necessary to eliminate any debit on
that ledger;
(K) eleventh, in no order of priority among them but in proportion to
the respective amounts due, to pay:
(1) amounts due in respect of interest and such part of any
termination payment due to the Series 1 Class C Dollar
Currency Swap Provider under the Series 1 Class C Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap
32
Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment received by the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order
of priority of payments) and from amounts received on each
Interest Payment Date in respect of interest from the Series
1 Class C Dollar Currency Swap Provider to pay on such
Interest Payment Date 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 or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received on each Interest Payment
Date in respect of interest from the Series 2 Class C Euro
Currency Swap Provider to pay on such Interest Payment Date
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 on each Interest Payment Date interest
due or overdue on the Series 3 Class C Notes to the holders
of the Series 3 Class C Notes;
(L) twelfth, to credit the Class C Principal Deficiency Sub Ledger in
an amount up to the amount necessary to eliminate any debit on the
Class C Principal Deficiency Sub Ledger;
(M) thirteenth, on the Payment Date falling in December of each year,
to pay to the Current Issuer Cash Manager an amount equal to the
amount of any debit balance on any Current Issuer Transaction
Account as permitted by the Current Issuer Cash Manager, incurred
in accordance with the provisions of the Current Issuer
Transaction Documents and outstanding as at such Payment Date;
(N) fourteenth, in no order of priority among 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;
33
(O) fifteenth, to pay to the Current Issuer an amount equal to 0.01%
per annum of the interest received under the Current Issuer
Intercompany Loan, to be retained by the Current Issuer as profit,
less corporation tax in respect of those profits provided for or
paid at item (C) above; and
(P) last, to pay to shareholders of the Current Issuer any dividend
declared by the Current Issuer.
If any Swap Collateral Available Revenue Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available Revenue
Amounts shall be applied by the Current Issuer Cash Manager on that
Payment Date in the same manner as it would have applied the receipts
which such Swap Collateral Available Revenue Amounts replace.
If, on any Payment Date, an amount equal to the cash benefit relating to
any Tax Credit obtained by the Current Issuer is required to be paid by
the Current Issuer to any Current Issuer Swap Provider (in accordance
with Part 5(o) of the Schedule to the relevant Current Issuer Swap
Agreement), then the Current Issuer shall make such payment on such
Payment Date out of the Current Issuer Available Revenue Receipts in
priority to the payments and provisions to be made on such Payment Date
in accordance with the Current Issuer Pre-Enforcement Revenue Priority
of Payments. The amount of any such cash benefit paid to the relevant
Current Issuer Swap Provider in accordance with this paragraph shall, to
avoid double counting, be deducted from the amount to be paid to that
Current Issuer Swap Provider under the relevant Current Issuer Swap
Agreement in accordance with the Current Issuer Pre-Enforcement Revenue
Priority of Payments on the relevant Payment Date.
4. Priority of Payments for Current Issuer Available Principal Receipts
4.1 Distribution of Current Issuer Available Principal Receipts Prior to
Enforcement of the Current Issuer Security
Prior to enforcement of the Current Issuer Security pursuant to the
Current Issuer Deed of Charge and/or the occurrence of a Trigger Event,
or until such time as there are no Current Issuer Notes outstanding,
Current Issuer Available Principal Receipts will be applied in the
following order of priority (the "Current Issuer Pre-Enforcement
Principal Priority of Payments"):
(A) first, amounts due in respect of principal and such part of any
termination payment due to the Series 1 Class A1 Dollar Currency
Swap Provider under the Series 1 Class A1 Dollar Currency Swap
(except for any termination payment or any part thereof due and
payable to that Swap Provider as a result of a Dollar Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any Swap Replacement
Payment received by the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order of
priority of payments) and from amounts received in respect of
principal from the Series 1 Class A1 Dollar Currency Swap Provider
to pay up to the Series 1 Class A1 Controlled Amortisation Amount
to the holders of the Series 1 Class A1 Notes;
34
(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 or any part thereof due and
payable to that Swap Provider as a result of a Dollar Currency
Swap Provider Default by that Swap Provider, save to the extent
such termination payment may be satisfied by any Swap Replacement
Payment received by the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order of
priority of payments) and from amounts received in respect of
principal from the Series 1 Class A2 Dollar Currency Swap Provider
to pay up to the Series 1 Class A2 Controlled Amortisation Amount
to the holders of the Series 1 Class A2 Notes;
(C) third, in no order of priority between them but in proportion to
the amounts due, to pay:
(1) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class A1 Dollar
Currency Swap Provider under the Series 2 Class A1 Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received in respect of principal
from the Series 2 Class A1 Dollar Currency Swap Provider to
pay up to the Series 2 Class A1 Controlled Amortisation
Amount to the holders of the Series 2 Class A1 Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class A2 Euro
Currency Swap Provider under the Series 2 Class A2 Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts received in respect of principal
from the Series 2 Class A2 Euro Currency Swap Provider to
pay up to the Series 2 Class A2 Controlled Amortisation
Amount to the holders of the Series 2 Class A2 Notes; and
(3) to pay 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
35
Class A Notes have been repaid in full) no order of priority among
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 or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
in respect of the Series 1 Class B Dollar Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received in respect of principal
from the Series 1 Class B Dollar Currency Swap Provider to
pay up to the Series 1 Class B Controlled Amortization
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 or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event in
respect of the Series 2 Class B Euro Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received in respect of principal
from the Series 2 Class B Euro Currency Swap Provider to pay
up to the Series 2 Class B Controlled Amortization Amount to
the holders of the Series 2 Class B Notes; and
(3) up to the Series 3 Class B Controlled Amortization Amount to
the holders of the Series 3 Class B Notes;
(E) fifth, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied on
such Payment Date (or, if any of the Issuer Reserve Requirement,
the Issuer Arrears Test and the Subordinated Principal Test are
not satisfied on such Payment Date, but the Class A Notes have
been repaid in full), in no order of priority among 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 M Dollar
Currency Swap Provider under the Series 1 Class M Dollar
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
in respect of the Series 1 Class M Dollar Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received in
36
respect of principal from the Series 1 Class M Dollar
Currency Swap Provider to pay up to the Series 1 Class M
Controlled Amortization Amount to the holders of the Series
1 Class M Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class M Euro
Currency Swap Provider under the Series 2 Class M Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event in
respect of the Series 2 Class M Euro Currency Swap and
applied in accordance with this order of priority of
payments) and from amounts received in respect of principal
from the Series 2 Class M Euro Currency Swap Provider to pay
up to the Series 2 Class M Controlled Amortization Amount to
the holders of the Series 2 Class M Notes; and
(3) up to the Series 3 Class M Controlled Amortization Amount to
the holders of the Series 3 Class M Notes; and
(F) last, provided that the Issuer Reserve Requirement, the Issuer
Arrears Test and the Subordinated Principal Test are satisfied on
such Payment Date (or, if any of the Issuer Reserve Requirement,
the Issuer Arrears Test and the Subordinated Principal Test are
not satisfied on such Payment Date, but the Class A Notes have
been repaid in full) in no order of priority among 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 C Dollar
Currency Swap Provider (except for any termination payment
or any part thereof due and payable to that Swap Provider as
a result of a Dollar Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) under the Series 1 Class C Dollar Currency Swap
and from amounts received in respect of principal from the
Series 1 Class C Dollar Currency Swap Provider to pay up to
the Series 1 Class C Controlled Amortisation Amount to the
holders of the Series 1 Class C Notes;
(2) amounts due in respect of principal and such part of any
termination payment due to the Series 2 Class C Euro
Currency Swap Provider under the Series 2 Class C Euro
Currency Swap (except for any termination payment or any
part thereof due and payable to that Swap Provider as a
result of a Euro Currency Swap Provider Default by that Swap
Provider, save to the extent such termination payment may be
satisfied by any Swap Replacement Payment received by the
Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of
payments) and from amounts
37
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.
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager on
that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Principal Amounts replace.
4.2 Distribution of Current Issuer Available Principal Receipts Following
the Occurrence of a Non-Asset Trigger Event and prior to the occurrence
of an Asset Trigger Event
Following the occurrence of a Non-Asset Trigger Event and prior to 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, to pay amounts (including such part of any termination
payment) due to the Series 1 Class A1 Dollar Currency Swap
Provider under the Series 1 Class A1 Dollar Currency Swap (except
for any termination payment or any part thereof due and payable to
that Swap Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment received
by the Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class A1 Dollar Currency
Swap Provider to repay the Series 1 Class A1 Notes until the
Series 1 Class A1 Notes have been repaid in full;
(B) second, to pay amounts (including such part of any termination
payment) due to the Series 1 Class A2 Dollar Currency Swap
Provider under the Series 1 Class A2 Dollar Currency Swap (except
for any termination payment or any part thereof due and payable to
that Swap Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such termination
payment may be satisfied by any Swap Replacement Payment received
by the Current Issuer following a Downgrade Termination Event and
applied in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class A2 Dollar Currency
Swap Provider to repay the Series 1 Class A2 Notes until the
Series 1 Class A2 Notes have been repaid in full;
38
(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 A1 Dollar Currency Swap
Provider under the Series 2 Class A1 Dollar Currency Swap
(except for any termination payment or any part thereof due
and payable to that Swap Provider as a result of a Dollar
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class A1 Dollar Currency
Swap Provider to repay the Series 2 Class A1 Notes until the
Series 2 Class A1 Notes have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class A2 Euro Currency Swap
Provider under the Series 2 Class A2 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class A2 Euro Currency
Swap Provider to repay the Series 2 Class A2 Notes until the
Series 2 Class A2 Notes have been repaid in full; and
(3) to repay the Series 3 Class A Notes until the Series 3 Class
A Notes have been repaid in full;
(D) fourth, in no order of priority among them, but in proportion to
the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class B Dollar Currency Swap
Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer following a Downgrade Termination Event and applied
in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class B Dollar
Currency Swap Provider to repay the Series 1 Class B Notes
until the Series 1 Class B Notes have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class B Euro Currency Swap
Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment or
39
any amount thereof due and payable to that Swap Provider as
a result of a Euro Currency Swap Provider Default by that
Swap Provider, save to the extent such termination payment
may be satisfied by any Swap Replacement Payment received by
the Current Issuer following a Downgrade Termination Event
and applied in accordance with this order of priority of
payments) and from amounts received from the Series 2 Class
B Euro Currency Swap Provider to repay the Series 2 Class B
Notes until the Series 2 Class B Notes have been repaid in
full; and
(3) to repay the Series 3 Class B Notes until the Series 3 Class
B Notes have been repaid in full;
(E) fifth, in no order of priority among 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 M Dollar Currency Swap
Provider under the Series 1 Class M Dollar Currency Swap
(except for any termination payment or any part thereof due
and payable to that Swap Provider, as a result of a Dollar
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment, received by the Current Issuer
following a Downgrade Termination Event in respect of the
Series 1 Class M Dollar Currency Swap and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 1 Class M Dollar Currency
Swap Provider to repay the Series 1 Class M Notes until the
Series 1 Class M Notes have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class M Euro Currency Swap
Provider under the Series 2 Class M Euro Currency Swap
(except for any termination payment or any part thereof due
and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event in respect of the
Series 2 Class M Euro Currency Swap and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class M Euro Currency
Swap Provider to repay the Series 2 Class M Notes until the
Series 2 Class M Notes have been repaid in full; and
(3) to repay the Series 3 Class M Notes until the Series 3 Class
M Notes have been repaid in full; and
(F) last, in no order of priority among 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
40
payment or any amount thereof due and payable to that Swap
Provider as a result of a Dollar Currency Swap Provider
Default by that Swap Provider, save to the extent such
termination payment may be satisfied by any Swap Replacement
Payment received by the Current Issuer following a Downgrade
Termination Event and applied in accordance with this order
of priority of payments) and from amounts received from the
Series 1 Class C Dollar Currency Swap Provider to repay the
Series 1 Class C Notes until the Series 1 Class C Notes have
been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C Euro Currency Swap
Provider under the Series 2 Class C Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class 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.
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager on
that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Principal Amounts replace.
4.3 Distribution of Current Issuer Available Principal Receipts Following
the Occurrence of an Asset Trigger Event
Following the occurrence of an Asset Trigger Event but prior to
enforcement of the Funding Security under the Funding Deed of Charge
and/or the Current Issuer Security under the Current Issuer Deed of
Charge, the Current Issuer Cash Manager will apply Current Issuer
Available Principal Receipts in the following order of priority:
(A) first, in no order of priority among them, but in proportion to
the amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A1 Dollar Currency Swap
Provider under the Series 1 Class A1 Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer
41
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 1 Class A1 Dollar Currency
Swap Provider to repay the Series 1 Class A1 Notes until the
Series 1 Class A1 Notes have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 1 Class A2 Dollar Currency Swap
Provider under the Series 1 Class A2 Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer following a Downgrade Termination Event and applied
in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class A2 Dollar
Currency Swap Provider to repay the Series 1 Class A2 Notes
until the Series 1 Class A2 Notes have been repaid in full;
(3) to pay amounts (including such part of any termination
payment) due to the Series 2 Class A1 Dollar Currency Swap
Provider under the Series 2 Class A1 Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer following a Downgrade Termination Event and applied
in accordance with this order of priority of payments) and
from amounts received from the Series 2 Class A1 Dollar
Currency Swap Provider to repay the Series 2 Class A1 Notes
until the Series 2 Class A1 Notes have been repaid in full;
(4) to pay amounts (including such part of any termination
payment) due to the Series 2 Class A2 Euro Currency Swap
Provider under the Series 2 Class A2 Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class A2 Euro Currency
Swap Provider to repay the Series 2 Class A2 Notes until the
Series 2 Class A2 Notes have been repaid in full; and
(5) to repay the Series 3 Class A Notes until the Series 3 Class
A Notes have been repaid in full;
(B) second, in no order of priority among them, but in proportion to
the amounts due:
42
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class B Dollar Currency Swap
Provider under the Series 1 Class B Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer following a Downgrade Termination Event and applied
in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class B Dollar
Currency Swap Provider to repay the Series 1 Class B Notes
until the Series 1 Class B Notes have been repaid in full;
and
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class B Euro Currency Swap
Provider under the Series 2 Class B Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class B Euro Currency
Swap Provider to repay the Series 2 Class B Notes until the
Series 2 Class B Notes have been repaid in full; and
(3) to repay the Series 3 Class B Notes until the Series 3 Class
B Notes have been repaid in full;
(C) third, in no order of priority among 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 M Dollar Currency Swap
Provider under the Series 1 Class M Dollar Currency Swap
(except for any termination payment or any part thereof due
and payable to that Swap Provider as a result of a Dollar
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event in respect of the
Series 1 Class M Dollar Currency Swap and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 1 Class M Dollar Currency
Swap Provider to repay the Series 1 Class M Notes until the
Series 1 Class M Notes have been repaid in full; and
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class M Euro Currency Swap
Provider under the Series 2 Class M Euro Currency Swap
(except for any termination payment or any part thereof due
and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to
43
the extent such termination payment may be satisfied by any
Swap Replacement Payment received by the Issuer following a
Downgrade Termination Event in respect of the Series 2 Class
M Euro Currency Swap and applied in accordance with this
order of priority of payments) and from amounts received
from the Series 2 Class M Euro Currency Swap Provider to
repay the Series 2 Class M Notes until the Series 2 Class M
Notes have been repaid in full; and
(3) to repay the Series 3 Class M Notes until the Series 3 Class
M Notes have been repaid in full; and
(D) last, in no order of priority among them, but in proportion to the
amounts due:
(1) to pay amounts (including such part of any termination
payment) due to the Series 1 Class C Dollar Currency Swap
Provider under the Series 1 Class C Dollar Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a
Dollar Currency Swap Provider Default by that Swap Provider,
save to the extent such termination payment may be satisfied
by any Swap Replacement Payment received by the Current
Issuer following a Downgrade Termination Event and applied
in accordance with this order of priority of payments) and
from amounts received from the Series 1 Class C Dollar
Currency Swap Provider to repay the Series 1 Class C Notes
until the Series 1 Class C Notes have been repaid in full;
(2) to pay amounts (including such part of any termination
payment) due to the Series 2 Class C Euro Currency Swap
Provider under the Series 2 Class C Euro Currency Swap
(except for any termination payment or any amount thereof
due and payable to that Swap Provider as a result of a Euro
Currency Swap Provider Default by that Swap Provider, save
to the extent such termination payment may be satisfied by
any Swap Replacement Payment received by the Current Issuer
following a Downgrade Termination Event and applied in
accordance with this order of priority of payments) and from
amounts received from the Series 2 Class 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.
If any Swap Collateral Available Principal Amounts are received by the
Current Issuer on a Payment Date, such Swap Collateral Available
Principal Amounts shall be applied by the Current Issuer Cash Manager on
that Payment Date in the same manner as it would have applied the
receipts which such Swap Collateral Available Principal Amounts replace.
5. Use of Ledgers
44
The Current Issuer Cash Manager shall forthwith record monies received
or payments made by it on behalf of the Current Issuer in the ledgers in
the manner set out in this Agreement. If, at any time, the Current
Issuer Cash Manager is in any doubt as to which ledger a particular
amount should be credited or debited, it shall consult with the Note
Trustee thereon.
Except in the case of the Current Issuer Principal Deficiency Ledger and
except as provided in Clause 2.4.(b) of the Current Issuer Bank Account
Agreement, a debit item shall only be made in respect of any of the
Current Issuer Ledgers, and the corresponding payment or transfer (if
any) may only be made from the Current Issuer Transaction Accounts, to
the extent that such entry does not cause the relevant ledger to have a
debit balance. In the case of the Current Issuer Principal Deficiency
Ledger and each Current Issuer Principal Deficiency Sub Ledger, a credit
item shall only be made to the extent that such entry does not cause
such ledger to have a credit balance.
6. Current Issuer Revenue Ledger
The Current Issuer Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Current Issuer
Revenue Ledger:
(i) all interest fees and any other amount (not including
principal), if any, paid by Funding to the Current Issuer
under the terms of the Current Issuer Intercompany Loan;
(ii) all interest received by the Current Issuer in respect of
the Current Issuer Bank Accounts;
(iii) all amounts received by the Current Issuer representing
income on any Current Issuer Authorised Investments;
(iv) all amounts (including any early termination payment which
is to be used to acquire, if necessary, a new basis rate
swap) received by the Current Issuer under the Basis Rate
Swap Agreement;
(v) all revenue amounts (including any early termination payment
which is to be used to acquire, if necessary, a new currency
swap) received by the Current Issuer under the Currency Swap
Agreements;
(vi) all revenue amounts (including any early termination payment
which is to be used to acquire, if necessary, a new interest
rate swap) received by the Current Issuer under the Current
Issuer Series 3 Class A Interest Rate Swap Agreement; and
(vii) any amount debited to the Current Issuer Principal Ledger
under paragraph 8; and
(b) any payment or provision made under paragraphs 1 and 3 of this
Schedule 2 shall be debited to the Current Issuer Revenue Ledger.
45
7. Current Issuer Principal Ledger
Without prejudice to paragraph 8 below, the Current Issuer Cash Manager
shall ensure that:
(a) the following amounts shall be credited to the Current Issuer
Principal Ledger:
(i) all principal paid by Funding to the Current Issuer under
the terms of the Current Issuer Intercompany Loan;
(ii) amounts credited to the Current Issuer Principal Deficiency
Ledger under paragraphs 3 and 8 (excluding amounts credited
to the Current Issuer Principal Deficiency Ledger under
paragraph 8(d)); 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) Second, on the Class B Principal Deficiency Sub Ledger,
until the balance of the Class B Principal Deficiency Sub
Ledger is equal to the aggregate Outstanding Principal
Balance of the Class B Notes; and
(iii) last, on the Class A Principal Deficiency Sub Ledger, at
which point an Asset Trigger Event will have occurred.
46
(d) The Current Issuer Cash Manager shall ensure that there shall be
credited to the Current Issuer Principal Deficiency Ledger amounts
to be credited to cure the deficiencies set out below and each
time such a credit is made, the Current Issuer shall deemed to
have cured the relevant deficiency in the following order:
(i) first, deficiencies which have resulted from the application
of Current Issuer Available Principal Receipts to meet any
deficiency in Current Issuer Available Revenue Receipts;
(ii) second, deficiencies which have arisen from Principal Losses
on the Mortgage Loans being allocated by Funding to the
Current Issuer Intercompany Loan; and
(iii) last, deficiencies which have arisen from the application by
Funding of Funding Allocable Principal Receipts to fund the
Current Issuer Liquidity Reserve Fund.
(e) If, on any Payment Date, any Funding Available Revenue Receipts
are applied by Funding as Funding Available Principal Receipts
pursuant to rule 4 of the rules of application of Funding
Available Revenue Receipts as set forth in Part 1 of Schedule 3 to
the Funding Deed of Charge, then on such Payment Date the Current
Issuer Cash Manger shall ensure that there shall be credited to
the Current Issuer Principal Deficiency Ledger an amount equal to
the amount so applied as Funding Available Principal Receipts.
9. Records
(a) The Current Issuer Cash Manager shall ensure that a separate
record is kept of any amount received from each of the Current
Issuer Swap Providers pursuant to each of the Current Issuer Swap
Agreements.
(b) 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.
(c) The Current Issuer Cash Manager hereby agrees that, each time the
Current Issuer Cash Manager records a credit on the Current Issuer
Principal Deficiency Ledger to cure a deficiency, the Current
Issuer Cash Manager shall also record on such Current Issuer
Principal Deficiency Ledger the source of such deficiency as being
one of the categories set forth in 8(d) above (as appropriate).
10. Swap Collateral Ledger
47
In connection with Swap Collateral the Current Issuer Cash Manager shall
ensure that the appropriate debits and credits are made to the Swap
Collateral Ledger in accordance with Clause 5.6 (Swap Collateral).
48
SCHEDULE 3
Form of Issuer Quarterly Report
Granite Mortgages 04-1 plc
Profit & Loss Account
Period Ended
This Quarter Prior Quarter
(GBP)000's (GBP) 000's
Interest Receivable - Intercompany Loan
Interest Receivable - Cash Deposits/
Authorised Investments
----------------------------
0 0
Interest Payable - Notes
Interest Payable
----------------------------
0 0
----------------------------
Net Operating Income 0 0
Other Income
Operating Expenses
----------------------------
Profit/loss on ordinary activities before tax 0 0
Taxation
----------------------------
Profit/loss on ordinary activities after tax 0 0
Dividend 0 0
Retained profit brought forward 0 0
----------------------------
Retained profit for the year 0 0
============================
49
Granite Mortgages 04-1 plc
Balance Sheet
Period Ended
(GBP) 000's (GBP) 000's
Fixed Asset Investments
Intercompany Lending 0
Current Assets
Interest Receivable 0
Other debtors 0
Cash at Bank 0
Current Issuer Transaction Account:
-----------
0
-----------
Creditors: Amounts falling due within one year
Accruals 0
Interest Payable Accrual 0
Taxation 0
-----------
0
-----------
Net current assets 0
Creditors: Amounts falling due after one year
Amount due to Noteholders 0
-----------
Total Assets less current liabilities 0
===========
Share Capital 0
Reserves 0
-----------
0
===========
50
Granite Mortgages 04-1 plc
Balance Sheet
Period Ended
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
51
Granite Mortgages 04-1 plc
Notes Outstanding
Period Ended
Series 1 Class A1 Series 1 Class A2 Series 2 Class A1 Series 2 Class A2 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 M Series 2 Class M Series 3 Class M
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
Series 1 Class C Series 2 Class C Series 3 Class C
Xxxxx'x Current Rating
Fitch Ratings Current Rating
S&P Current Rating
Series 1 Class A1 Series 1 Class A2 Series 2 Class A1 Series 2 Class A2 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 M Series 2 Class M Series 3 Class M
Initial Note Balance
Previous QuartersNote
Principal
Note Redemptions
Outstanding Note Principal
Series 1 Class C Series 2 Class C Series 3 Class C
Initial Note Balance
Previous Quarters Note
Principal
Note Redemptions
Outstanding Note Principal
Series 1 Class A1 Series 1 Class A2 Series 2 Class A1 Series 2 Class A2 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 M Series 2 Class M Series 3 Class M
Note Interest Margins
Step Up Dates
Step Up Margins
52
Series 1 Class C Series 2 Class C Series 3 Class C
Note Interest Margins
Step Up Dates
Step Up Margins
Payment Cycle
Payment Date
Next Payment Date
Amount Credited to Principal
Deficiency Sub Ledger:
Current Quarter:
Aggregate:
53
SCHEDULE 4
Controlled Amortisation Amount/Target Balance
The "Controlled Amortisation Amount" for each Class of Current Issuer Notes
for any Payment Date set forth below is an amount equal to the amount which
the Current Issuer would be required to repay in respect of such Class of
Current Issuer Notes so that on the relevant Payment Date the aggregate
Principal Amount Outstanding of such Class of Current Issuer Notes has been
reduced to (but is not less than) the "Target Balance" set out in the
following table:
54
-------------------------------------------------------------------------------------------------------------------------------
Payment date target balance for series 1 target balance for series 1 target balance for series 1
occurring in: class A1 notes class A2 notes class B notes
---------------- ---------------------------------- ------------------------ -------- -----------------------------------
(GBP) $ (GBP) $ (GBP) $
------------------ -------------- --------------- ----------------- ---------------- -----------------
Mar 04 483,475,799 888,000,000 645,178,853 1,185,000,000 28,311,646 52,000,000
Jun 04 322,317,199 592,000,000 645,178,853 1,185,000,000 28,311,646 52,000,000
Sep 04 161,158,600 296,000,000 645,178,853 1,185,000,000 28,311,646 52,000,000
Dec 04 0 0 645,178,853 1,185,000,000 28,311,646 52,000,000
Mar 05 0 0 503,620,624 925,000,000 28,311,646 52,000,000
Jun 05 0 0 371,862,580 683,000,000 28,311,646 52,000,000
Sep 05 0 0 245,004,628 450,000,000 28,311,646 52,000,000
Dec 05 0 0 125,224,588 230,000,000 28,311,646 52,000,000
Mar 06 0 0 0 0 28,311,646 52,000,000
Jun 06 0 0 0 0 0 0
Sep 06 0 0 0 0 0 0
Dec 06 0 0 0 0 0 0
Mar 07 0 0 0 0 0 0
Jun 07 0 0 0 0 0 0
Sep 07 0 0 0 0 0 0
Dec 07 0 0 0 0 0 0
Mar 08 0 0 0 0 0 0
Jun 08 0 0 0 0 0 0
Sep 08 0 0 0 0 0 0
Dec 08 0 0 0 0 0 0
Mar 09 0 0 0 0 0 0
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
Payment date target balance for series 1 target balance for series 1
occurring in: class M notes class C notes
---------------- ---------------------------------- ------------------------ ---------
(GBP) $ (GBP) $
------------------ -------------- --------------- -----------------
Mar 04 39,200,740 72,000,000 58,801,111 108,000,000
Jun 04 39,200,740 72,000,000 58,801,111 108,000,000
Sep 04 39,200,740 72,000,000 58,801,111 108,000,000
Dec 04 39,200,740 72,000,000 58,801,111 108,000,000
Mar 05 39,200,740 72,000,000 58,801,111 108,000,000
Jun 05 39,200,740 72,000,000 58,801,111 108,000,000
Sep 05 39,200,740 72,000,000 58,801,111 108,000,000
Dec 05 39,200,740 72,000,000 58,801,111 108,000,000
Mar 06 39,200,740 72,000,000 58,801,111 108,000,000
Jun 06 0 0 0 0
Sep 06 0 0 0 0
Dec 06 0 0 0 0
Mar 07 0 0 0 0
Jun 07 0 0 0 0
Sep 07 0 0 0 0
Dec 07 0 0 0 0
Mar 08 0 0 0 0
Jun 08 0 0 0 0
Sep 08 0 0 0 0
Dec 08 0 0 0 0
Mar 09 0 0 0 0
-------------------------------------------------------------------------------------------------------------------------------
55
-----------------------------------------------------------------------------------------------------------------------------------
Payment date target balance for series 2 target balance for series 2 target balance for series 2
occurring in: class A1 notes class A2 notes class B notes
---------------- ------------------------------------ ------------------------------------- ----------------------------------
(GBP) $ (GBP) (Euro) (GBP) (Euro)
---------------- ----------------- ----------------- ----------------- --------------- ----------------
Mar 04 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Jun 04 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Sep 04 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Dec 04 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Mar 05 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Jun 05 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Sep 05 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Dec 05 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Mar 06 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Jun 06 646,128,680 1,185,000,000 620,689,655 900,000,000 62,758,621 91,000,000
Sep 06 606,870,229 1,113,000,000 593,103,448 860,000,000 62,758,621 91,000,000
Dec 06 561,613,959 1,030,000,000 563,448,276 817,000,000 62,758,621 91,000,000
Mar 07 542,529,989 995,000,000 513,793,103 745,000,000 62,758,621 91,000,000
Jun 07 509,269,357 934,000,000 482,758,621 700,000,000 62,758,621 91,000,000
Sep 07 473,282,443 868,000,000 457,241,379 663,000,000 62,758,621 91,000,000
Dec 07 452,017,448 829,000,000 428,275,862 621,000,000 62,758,621 91,000,000
Mar 08 430,207,197 789,000,000 400,000,000 580,000,000 62,758,621 91,000,000
Jun 08 412,758,997 757,000,000 375,172,414 544,000,000 62,758,621 91,000,000
Sep 08 387,677,208 711,000,000 355,172,414 515,000,000 62,758,621 91,000,000
Dec 08 358,778,626 658,000,000 334,482,759 485,000,000 62,758,621 91,000,000
Mar 09 335,877,863 616,000,000 313,103,448 454,000,000 62,758,621 91,000,000
-----------------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Payment date target balance for series 3 target balance for series 2
occurring in: class M notes class C notes
---------------- -------------------------------------- -----------------------------------------
(GBP) (Euro) (GBP) (Euro)
-------------------- --------------- -------------------- ------------------
Mar 04 31,034,483 45,000,000 41,379,310 60,000,000
Jun 04 31,034,483 45,000,000 41,379,310 60,000,000
Sep 04 31,034,483 45,000,000 41,379,310 60,000,000
Dec 04 31,034,483 45,000,000 41,379,310 60,000,000
Mar 05 31,034,483 45,000,000 41,379,310 60,000,000
Jun 05 31,034,483 45,000,000 41,379,310 60,000,000
Sep 05 31,034,483 45,000,000 41,379,310 60,000,000
Dec 05 31,034,483 45,000,000 41,379,310 60,000,000
Mar 06 31,034,483 45,000,000 41,379,310 60,000,000
Jun 06 31,034,483 45,000,000 41,379,310 60,000,000
Sep 06 31,034,483 45,000,000 41,379,310 60,000,000
Dec 06 31,034,483 45,000,000 41,379,310 60,000,000
Mar 07 31,034,483 45,000,000 41,379,310 60,000,000
Jun 07 31,034,483 45,000,000 41,379,310 60,000,000
Sep 07 31,034,483 45,000,000 41,379,310 60,000,000
Dec 07 31,034,483 45,000,000 41,379,310 60,000,000
Mar 08 31,034,483 45,000,000 41,379,310 60,000,000
Jun 08 31,034,483 45,000,000 41,379,310 60,000,000
Sep 08 31,034,483 45,000,000 41,379,310 60,000,000
Dec 08 31,034,483 45,000,000 41,379,310 60,000,000
Mar 09 31,034,483 45,000,000 41,379,310 60,000,000
----------------------------------------------------------------------------------------------------
56
-------------------------------------------------------------------------------------------------------------------------------
Payment date (GBP) target balance for (GBP) target balance for (GBP) target balance for (GBP) target balance for
occurring in: series 3 class A notes series 3 class B notes series 3 class M notes series 3 class C notes
-------------- -------------------------- -------------------------- --------------------------- --------------------------
(GBP) (GBP) (GBP) (GBP)
-------------------------- -------------------------- --------------------------- --------------------------
Mar 04 600,000,000 23,000,000 10,000,000 20,000,000
Jun 04 600,000,000 23,000,000 10,000,000 20,000,000
Sep 04 600,000,000 23,000,000 10,000,000 20,000,000
Dec 04 600,000,000 23,000,000 10,000,000 20,000,000
Mar 05 600,000,000 23,000,000 10,000,000 20,000,000
Jun 05 600,000,000 23,000,000 10,000,000 20,000,000
Sep 05 600,000,000 23,000,000 10,000,000 20,000,000
Dec 05 600,000,000 23,000,000 10,000,000 20,000,000
Mar 06 600,000,000 23,000,000 10,000,000 20,000,000
Jun 06 600,000,000 23,000,000 10,000,000 20,000,000
Sep 06 573,000,000 23,000,000 10,000,000 20,000,000
Dec 06 540,000,000 23,000,000 10,000,000 20,000,000
Mar 07 500,000,00 23,000,000 10,000,000 20,000,000
Jun 07 468,000,000 23,000,000 10,000,000 20,000,000
Sep 07 444,000,000 23,000,000 10,000,000 20,000,000
Dec 07 414,000,000 23,000,000 10,000,000 20,000,000
Mar 08 390,000,000 23,000,000 10,000,000 20,000,000
Jun 08 366,000,000 23,000,000 10,000,000 20,000,000
Sep 08 342,000,000 23,000,000 10,000,000 20,000,000
Dec 08 324,000,000 23,000,000 10,000,000 20,000,000
Mar 09 305,000,000 23,000,000 10,000,000 20,000,000
--------------------------------------- -- ------------------------- ---- --------------------- ------ -----------------------
57
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 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 for Group 2 Issuers
(after taking into account principal payments on such Payment
Date) less an amount equal the product of:
(i) the sum of (1) the product of (A) the sum of the Mortgages
Trustee Principal Receipts for each Distribution Date since
the immediately preceding Payment Date for Group 2 Issuers,
and (B) the Funding Share Percentage applicable as at the
later to occur of the immediately preceding Assignment Date,
the immediately preceding Funding Contribution Date and the
immediately preceding Distribution Date, and (2) the amount
standing to the credit of the Funding Principal Ledger as at
the end of the preceding Payment Date for Group 2 Issuers
(after application of Funding Available Principal Receipts
on that Preceding Payment 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 for Group 2 Issuers
(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 for Group 2 Issuers (after taking into account
principal payments on such Payment Date) less the sum of (1)
the aggregate amount of all Special Repayment Notes and (2)
the aggregate of amounts recorded on the Principal
Deficiency Ledgers of all Issuers; and
(iii) either:
(A) if the Class A Notes have not been repaid in full on
that Payment Date and either the Issuer Arrears Test
or the Issuer Reserve Requirement or the Subordinated
Principal Test has not been satisfied on such Payment
Date:
(I) in relation to Class A Notes, the quotient of
(A) the aggregate Principal Amount Outstanding
on the relevant Class of Notes as at the
immediately preceding Payment Date for Group 2
Issuers (after taking into account principal
payments on Payment Date), divided by (B) the
Aggregate Principal Amount Outstanding on
58
all Class A Notes of the Issuer as at the
immediately preceding Payment Date for Group 2
Issuers (after taking into account principal
payments on such Payment Date); and
(II) in relation to any other Class of Notes, zero;
and
(B) In any other case, the quotient of (A) the aggregate
Principal Amount Outstanding on the relevant Class of
Notes as at the immediately preceding Payment Date for
Group 2 Issuers (after taking into account principal
payments on such Payment Date) divided by (B) the
aggregate Principal Amount Outstanding on all Notes of
the Current Issuer as at the immediately preceding
Payment Date for Group 2 Issuers (after taking into
account principal payments on such Payment Date).
To the extent not repaid earlier, the full Principal Amount Outstanding
on a Class of Current Issuer Notes will become due and payable on the
final maturity date of that Class of Notes.
59
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:
60
(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 is 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.
61
EXECUTION PAGE
The Current Issuer Cash Manager
Executed by
NORTHERN ROCK PLC
as follows: By
Signed for and on its behalf by one --------------------------------
of its duly authorised Duly Authorised
attorneys/signatories Attorney/Signatory
Name
--------------------------------
The Current Issuer
Executed by
GRANITE MORTGAGES 04-1 PLC
as follows: By
Signed for and on its behalf by one --------------------------------
of its duly authorised Duly Authorised
attorneys/signatories Attorney/Signatory
Name
--------------------------------
The Note Trustee
Executed by
THE BANK OF NEW YORK
as follows: By
Signed for and on its behalf by one --------------------------------
of its duly authorised Duly Authorised
attorneys/signatories Attorney/Signatory
Name
--------------------------------
62
