DRAFT 2: 11.03.03
LOAN CONFIRMATION
SEVENTH ISSUER INTERCOMPANY LOAN AGREEMENT
DATED {circle} MARCH, 2003
▇▇▇▇▇▇ FUNDING LIMITED
(FUNDING)
▇▇▇▇▇▇ FINANCING (NO. 7) PLC
(THE SEVENTH ISSUER)
JPMORGAN CHASE BANK, LONDON BRANCH
(THE SECURITY TRUSTEE)
JPMORGAN CHASE BANK, LONDON BRANCH
(THE AGENT BANK)
▇▇▇▇▇ & ▇▇▇▇▇
London
CONTENTS
CLAUSE PAGE
1. Interpretation............................................ 1
2. Intercompany Loan Terms and Conditions.................... 2
3. The Seventh Issuer Term Advances.......................... 2
4. Interest.................................................. 4
5. Repayment................................................. 6
6. Prepayment................................................ 10
7. Certain Fees, etc......................................... 11
8. Application of Certain Provisions......................... 13
9. Declaration of Trust...................................... 13
10. Addresses................................................. 13
SCHEDULE
1. Conditions Precedent in respect of Drawdown............... 15
Signatories..................................................... 18
THIS AGREEMENT is dated {circle} March, 2003
BETWEEN:
(1) ▇▇▇▇▇▇ FUNDING LIMITED (registered in England and Wales No. 3982428)
whose registered office is at Abbey National House, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇'▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (FUNDING);
(2) ▇▇▇▇▇▇ FINANCING (NO. 7) PLC (registered in England and Wales No.
4645659) whose registered office is at Abbey National House, ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇'▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the SEVENTH ISSUER);
(3) JPMORGAN CHASE BANK, LONDON BRANCH, formerly known as The Chase Manhattan
Bank, London Branch whose offices are at Trinity Tower, ▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the SECURITY TRUSTEE which expression shall
include such person and all other persons for the time being acting as
the security trustee or trustees pursuant to the Funding Deed of Charge);
and
(4) JPMORGAN CHASE BANK, LONDON BRANCH, formerly known as The Chase Manhattan
Bank, London Branch whose offices are at Trinity Tower, ▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the AGENT BANK which expression shall include
such person and all other persons for the time being acting as the agent
bank pursuant to the Seventh Issuer Paying Agent and Agent Bank
Agreement).
IT IS AGREED as follows:
1. INTERPRETATION
1.1 The Amended and Restated Master Definitions and Construction Schedule
signed for the purposes of identification by ▇▇▇▇▇ & ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇
and May on {circle} March, 2003 (and as the same may be further amended,
varied or supplemented from time to time with the consent of the parties
hereto) and the Seventh Issuer Master Definitions and Construction
Schedule signed for the purposes of identification by ▇▇▇▇▇ & ▇▇▇▇▇ and
▇▇▇▇▇▇▇▇▇ and May on {circle} March, 2003 are expressly and specifically
incorporated into this Agreement and, accordingly, the expressions
defined in the Amended and Restated Master Definitions and Construction
Schedule and/or the Seventh Issuer Master Definitions and Construction
Schedule (as so amended, varied or supplemented) shall, except where the
context otherwise requires and save where otherwise defined herein, have
the same meanings in this Agreement, including the Recitals hereto and
this Agreement shall be construed in accordance with the interpretation
provisions set out in Clause 2 of the Amended and Restated Master
Definitions and Construction Schedule and Clause 2 of the Seventh Issuer
Master Definitions and Construction Schedule. In the event of a conflict
between the Amended and Restated Master Definitions and Construction
Schedule and the Seventh Issuer Master Definitions and Construction
Schedule, the Seventh Issuer Master Definitions and Construction Schedule
shall prevail.
1.2 Unless the context otherwise requires, references in the Intercompany
Loan Terms and Conditions to:
CLOSING DATE means {circle} March, 2003;
INTERCOMPANY LOAN means the Seventh Issuer Intercompany Loan;
1
INTERCOMPANY LOAN AGREEMENT means the Seventh Issuer Intercompany Loan
Agreement;
INTERCOMPANY LOAN CONFIRMATION means the Seventh Issuer Intercompany Loan
Confirmation;
ISSUER means the Seventh Issuer;
ISSUER TRANSACTION ACCOUNT means the Seventh Issuer Sterling Account;
NOTES means the Seventh Issuer Notes; and
TERM ADVANCES means the Seventh Issuer Term Advances.
2. INTERCOMPANY LOAN TERMS AND CONDITIONS
Each of the parties to this Agreement agree that the Intercompany Loan
Terms and Conditions signed by Funding and the Security Trustee for the
purposes of identification on 26th July, 2000, as amended by the
Amendment Agreement to the Intercompany Loan Terms and Conditions made
between Funding, ▇▇▇▇▇▇ Financing (No. 1) PLC, the Security Trustee and
the Agent Bank on 29th November, 2000 and the Second Amendment Agreement
to the Intercompany Loan Terms and Conditions made between Funding,
▇▇▇▇▇▇ Financing (No.1) PLC, ▇▇▇▇▇▇ Financing (No. 2) PLC, ▇▇▇▇▇▇
Financing (No. 3) PLC, the Security Trustee and the Agent Bank on 5th
July, 2001, and the provisions set out therein shall form part of this
Agreement and shall be binding on the parties to this Agreement as if
they had expressly been set out herein. References in this Agreement to
THIS AGREEMENT shall be construed accordingly.
3. THE SEVENTH ISSUER TERM ADVANCES
3.1 SEVENTH ISSUER TERM AAA ADVANCES
On and subject to the terms of this Agreement, the Seventh Issuer grants
to Funding a term loan which consists of the following sub loans:
(a) the series 1 term AAA advance in the maximum aggregate principal
amount of {pound-sterling}[473,780,000] (the SEVENTH ISSUER SERIES
1 TERM AAA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 1 Class A Seventh Issuer Notes;
(b) the series 2 term AAA advance in the maximum aggregate principal
amount of {pound-sterling}[789,640,000] (the SEVENTH ISSUER SERIES
2 TERM AAA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 2 Class A Seventh Issuer Notes;
(c) the series 3 term AAA advance in the maximum aggregate principal
amount of {pound-sterling}[315,856,000] (the SEVENTH ISSUER SERIES
3 TERM AAA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 3 Class A Seventh Issuer Notes; and
(d) the series 4A1 term AAA advance in the maximum aggregate principal
amount of {pound-sterling}[344,590,000] (the SEVENTH ISSUER SERIES
4A1 TERM AAA ADVANCE) and which corresponds to the principal
amount upon issue of the Series 4 Class A1 Seventh Issuer Notes;
and
2
(e) the series 4 term AAA advance in the maximum aggregate principal
amount of {pound-sterling}[250,000,000] (the SEVENTH ISSUER SERIES
4A2 TERM AAA ADVANCE) and which corresponds to the principal
amount upon issue of the Series 4 Class A2 Seventh Issuer Notes,
and together the Seventh Issuer Series 1 Term AAA Advance, the Seventh
Issuer Series 2 Term AAA Advance, the Seventh Issuer Series 3 Term AAA
Advance, the Seventh Issuer Series 4A1 Term AAA Advance and the Series
4A2 Term AAA Advance are referred to herein as the SEVENTH ISSUER TERM
AAA ADVANCES.
3.2 SEVENTH ISSUER TERM AA ADVANCES
On and subject to the terms of this Agreement, the Seventh Issuer grants
to Funding a term loan which consists of the following sub loans:
(a) the series 1 term AA advance in the maximum aggregate principal
amount of {pound-sterling}[14,210,000] (the SEVENTH ISSUER SERIES
1 TERM AA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 1 Class B Seventh Issuer Notes;
(b) the series 2 term AA advance in the maximum aggregate principal
amount of {pound-sterling}[23,690,000] (the SEVENTH ISSUER SERIES
2 TERM AA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 2 Class B Seventh Issuer Notes;
(c) the series 3 term AA advance in the maximum aggregate principal
amount of {pound-sterling}[15,000,000] (the SEVENTH ISSUER SERIES
3 TERM AA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 3 Class B Seventh Issuer Notes; and
(d) the series 4 term AA advance in the maximum aggregate principal
amount of {pound-sterling}[28,256,000] (the SEVENTH ISSUER SERIES
4 TERM AA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 4 Class B Seventh Issuer Notes,
and together the Seventh Issuer Series 1 Term AA Advance, the Seventh
Issuer Series 2 Term AA Advance, the Seventh Issuer Series 3 Term AA
Advance and the Seventh Issuer Series 4 Term AA Advance are referred to
herein as the SEVENTH ISSUER TERM AA ADVANCES.
3.3 SEVENTH ISSUER TERM A ADVANCES
On and subject to the terms of this Agreement, the Seventh Issuer grants
to Funding a term loan which consists of the following sub loans:
(a) the series 1 term A advance in the maximum aggregate principal
amount of {pound-sterling}[24,160,000] (the SEVENTH ISSUER SERIES
1 TERM A ADVANCE) and which corresponds to the principal amount
upon issue of the Series 1 Class M Seventh Issuer Notes;
(b) the series 2 term A advance in the maximum aggregate principal
amount of {pound-sterling}[40,270,000] (the SEVENTH ISSUER SERIES
2 TERM A ADVANCE) and which corresponds to the principal amount
upon issue of the Series 2 Class M Seventh Issuer Notes;
3
(c) the series 3 term A advance in the maximum aggregate principal
amount of {pound-sterling}[20,000,000] (the SEVENTH ISSUER SERIES
3 TERM A ADVANCE) and which corresponds to the principal amount
upon issue of the Series 3 Class M Seventh Issuer Notes; and
(d) the series 4 term A advance in the maximum aggregate principal
amount of {pound-sterling}[38,590,000] (the SEVENTH ISSUER SERIES
4 TERM AA ADVANCE) and which corresponds to the principal amount
upon issue of the Series 4 Class M Seventh Issuer Notes,
and together the Seventh Issuer Series 1 Term A Advance, the Seventh
Issuer Series 2 Term A Advance, the Seventh Issuer Series 3 Term A
Advance and the Seventh Issuer Series 4 Term A Advance are referred to
herein as the SEVENTH ISSUER TERM A ADVANCES.
3.4 TERM ADVANCE RATING
The Term Advance Rating in respect of the Seventh Issuer Term AAA
Advances shall be AAA/AAA/Aaa, the Term Advance Rating in respect of the
Seventh Issuer Term AA Advances shall be AA/AA/Aa3 and the Term Advance
Rating in respect of the Seventh Issuer Term A Advances shall be A/A/A2.
3.5 CONDITIONS PRECEDENT
Save as the Seventh Issuer and the Security Trustee may otherwise agree,
the Seventh Issuer Term Advances will not be available for utilisation
unless the Security Trustee has confirmed to Funding that it or its
advisers have received all the information and documents listed in
Schedule 1 in form and substance satisfactory to the Security Trustee and
the Seventh Issuer has entered into the Funding Deed of Charge.
4. INTEREST
4.1 RATE OF INTEREST TO FIRST INTEREST PAYMENT DATE
On the Closing Date the Agent Bank will determine the INITIAL RELEVANT
SCREEN RATE (as defined below) in respect of each Seventh Issuer Term
Advance at or about 11.00 a.m. (London time) on that date. If the
Initial Relevant Screen Rate is unavailable, the Agent Bank will request
the principal London office of each of the Reference Banks (as defined in
the Amended and Restated Master Definitions and Construction Schedule) to
provide the Agent Bank with its offered quotations to leading banks for
two-month and three-month sterling deposits of
{pound-sterling}10,000,000, in the London inter-bank market as at or
about 11.00 a.m. (London time) on such Closing Date. The Term Advance
Rates of Interest for the first Interest Period (as defined in the
Amended and Restated Master Definitions and Construction Schedule) shall
be the aggregate of (1) the Relevant Margin (as defined below) and (2)
the Initial Relevant Screen Rate or, if the Initial Relevant Screen Rate
is unavailable, the linear interpolation of the arithmetic mean of such
offered quotations for two-month sterling deposits and the arithmetic
mean of such offered quotations for three-month sterling deposits
(rounded upwards, if necessary, to five decimal places).
INITIAL RELEVANT SCREEN RATE means the linear interpolation of the
arithmetic mean of the offered quotations to leading banks for two-month
sterling deposits and the arithmetic mean of the offered quotations to
leading banks for three-month sterling deposits (rounded upwards if
necessary to five decimal places) displayed on the ▇▇▇-▇▇▇▇▇/Telerate
monitor at Telerate page number 3750.
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4.2 TERM ADVANCE RATES OF INTEREST
The Term Advance Rate of Interest payable on each Term Advance shall be
LIBOR for three month sterling deposits as determined in accordance with
Clause 6 of the Intercompany Loan Terms and Conditions plus a RELEVANT
MARGIN which shall be:
(a) in respect of the Seventh Issuer Series 1 Term AAA Advance, a
margin of -[0.003] per cent. per annum;
(b) in respect of the Seventh Issuer Series 2 Term AAA Advance, a
margin of [0.178] per cent. per annum;
(c) in respect of the Seventh Issuer Series 3 Term AAA Advance, a
margin of [0.246] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [0.752] per
cent. per annum;
(d) in respect of the Seventh Issuer Series 4A1 Term AAA Advance, a
margin of [0.2437] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [0.7474] per
cent. per annum;
(e) in respect of the Sixth Issuer Series 4A2 Term AAA Advance, a
margin of [0.340] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [0.610] per
cent. per annum;
(f) in respect of the Seventh Issuer Series 1 Term AA Advance, a
margin of [0.3978] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [1.0556] per
cent. per annum;
(g) in respect of the Seventh Issuer Series 2 Term AA Advance, a
margin of [0.4333] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [1.1266] per
cent. per annum;
(h) in respect of the Seventh Issuer Series 3 Term AA Advance, a
margin of [0.529] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [1.318] per
cent. per annum;
(i) in respect of the Seventh Issuer Series 4 Term AA Advance, a
margin of [0.5409] per cent. per annum up to (and including) the
Interest Period ending in April 2008 and thereafter [1.3418] per
cent. per annum;
(j) in respect of the Seventh Issuer Series 1 Term A Advance, a margin
of [1.4063] per cent. per annum up to (and including) the Interest
Period ending in April 2008 and thereafter [2.6663] per cent. per
annum;
(k) in respect of the Seventh Issuer Series 2 Term A Advance, a margin
of [1.5219] per cent. per annum up to (and including) the Interest
Period ending in April 2008 and thereafter [2.7819] per cent. per
annum;
(l) in respect of the Seventh Issuer Series 3 Term A Advance, a margin
of [1.600] per cent. per annum up to (and including) the Interest
Period ending in April 2008 and thereafter [2.860] per cent. per
annum; and
5
(m) in respect of the Seventh Issuer Series 4 Term A Advance, a margin
of [1.6289] per cent. per annum up to (and including) the Interest
Period ending in April 2008 and thereafter [2.8889] per cent. per
annum.
4.3 INTEREST PERIODS
The first Interest Period shall commence on (and include) the Closing
Date and end on (but exclude) the Interest Payment Date (as defined in
the Amended and Restated Master Definitions and Construction Schedule)
falling in July 2003. Each subsequent Interest Period shall commence on
(and include) an Interest Payment Date and end on (but exclude) the
following Interest Payment Date.
5. REPAYMENT
5.1 REPAYMENT SUBJECT TO TERMS OF THE FUNDING DEED OF CHARGE
The terms and provisions of this Clause are to be read subject to the
provisions of Part II of Schedule 3 to the Funding Deed of Charge and as
the same may be further amended or varied from time to time in accordance
with the terms of the Funding Deed of Charge.
5.2 REPAYMENT OF SEVENTH ISSUER TERM AAA ADVANCES PRIOR TO A TRIGGER EVENT,
ENFORCEMENT OF THE FUNDING SECURITY OR ENFORCEMENT OF THE SEVENTH ISSUER
SECURITY
Prior to the occurrence of a Trigger Event, enforcement of the Funding
Security or enforcement of the Seventh Issuer Security, Funding shall
repay to the Seventh Issuer:
(a) the Seventh Issuer Series 1 Term AAA Advance in the amount of
{pound-sterling}[236,890,000] on the Interest Payment Date falling
in January 2004 and in the amount of {pound-sterling}[236,890,000]
on the Interest Payment Date falling in April 2004, but if there
are insufficient funds available to repay the amount due on the
Interest Payment Date falling in January 2004, then the shortfall
shall be repaid on the subsequent Interest Payment Date falling in
April 2004 (together with any other amounts due on that Interest
Payment Date on the Seventh Issuer Series 1 Term AAA Advance) from
Funding Available Principal Receipts therefor until the Seventh
Issuer Series 1 Term AAA Advance is fully repaid;
(b) the Seventh Issuer Series 2 Term AAA Advance on the Interest
Payment Date falling in January 2006 but if there are insufficient
funds available to repay the Seventh Issuer Series 2 Term AAA
Advance on such Interest Payment Date, then the shortfall shall be
repaid on subsequent Interest Payment Dates from Funding Available
Principal Receipts therefor until the Seventh Issuer Series 2 Term
AAA Advance is fully repaid; and
(c) the Seventh Issuer Series 3 Term AAA Advance in the amount of
{pound-sterling}[157,928,000] on the Interest Payment Date falling
in January 2007 and in the amount of {pound-sterling}[157,928,000]
on the interest date falling in April 2007 but if there are
insufficient funds available to repay the Seventh Issuer Series 3
Term AAA Advance on the Interest Payment Date falling in January
2007 then the shortfall shall be repaid on the subsequent Interest
Payment Date falling in April 2007 (together with any other
amounts due on that Interest Payment Date on the Seventh Issuer
Series 3 Term AAA Advance from Funding Available Principal
Receipts therefor until the Seventh Issuer Series 3 Term AAA
Advance is fully repaid;
6
5.3 REPAYMENT OF SEVENTH ISSUER TERM AA ADVANCES PRIOR TO A TRIGGER EVENT, OR
ENFORCEMENT OF THE FUNDING SECURITY OR ENFORCEMENT OF THE SEVENTH ISSUER
SECURITY
(a) Subject to Clauses 5.5 and 5.6 hereof, prior to the occurrence of a
Trigger Event, enforcement of the Funding Security or enforcement
of the Seventh Issuer Security, Funding shall repay to the Seventh
Issuer:
(i) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 1
Term AAA Advance is fully repaid, the Seventh Issuer Series
1 Term AA Advance to the extent of Funding Available
Principal Receipts therefor until the Seventh Issuer Series
1 Term AA Advance is fully repaid;
(ii) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 2
Term AAA Advance is fully repaid, the Seventh Issuer Series
2 Term AA Advance to the extent of Funding Available
Principal Receipts therefor until the Seventh Issuer Series
2 Term AA Advance is fully repaid;
(iii) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 3
Term AAA Advance is fully repaid, the Seventh Issuer Series
3 Term AA Advance to the extent of Funding Available
Principal Receipts therefor until the Seventh Issuer Series
3 Term AA Advance is fully repaid; and
(iv) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 4
Term AAA Advances are fully repaid, the Seventh Issuer
Series 4 Term AA Advance to the extent of Funding Available
Principal Receipts therefor until the Seventh Issuer Series
4 Term AA Advance is fully repaid.
(b) If on any Interest Payment Date amounts are due and payable under
a Seventh Issuer Term AA Advance when amounts are also due and
payable under a Seventh Issuer Term AAA Advance, then Funding
shall apply Funding Available Principal Receipts to repay the
Seventh Issuer Term AAA Advance in priority to any amounts due
under any Seventh Issuer Term AA Advance.
(c) If on any Interest Payment Date amounts are due and payable under
more than one Seventh Issuer Term AA Advance, then Funding shall
apply Funding Available Principal Receipts to repay the Seventh
Issuer Term AA Advances pro rata according to the respective
amounts thereof.
5.4 REPAYMENT OF SEVENTH ISSUER TERM A ADVANCES PRIOR TO A TRIGGER EVENT, OR
ENFORCEMENT OF THE FUNDING SECURITY OR ENFORCEMENT OF THE SEVENTH ISSUER
SECURITY
(a) Subject to Clauses 5.5 and 5.6 hereof, prior to the occurrence of a
Trigger Event, enforcement of the Funding Security or enforcement
of the Seventh Issuer Security, Funding shall repay to the Seventh
Issuer:
(i) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 1
Term AA Advance is fully repaid, the Seventh Issuer Series 1
Term A Advance to the extent of Funding Available Principal
Receipts therefor until the Seventh Issuer Series 1 Term A
Advance is fully repaid;
7
(ii) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 2
Term AA Advance is fully repaid, the Seventh Issuer Series 2
Term A Advance to the extent of Funding Available Principal
Receipts therefor until the Seventh Issuer Series 2 Term A
Advance is fully repaid;
(iii) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 3
Term AA Advance is fully repaid, the Seventh Issuer Series 3
Term A Advance to the extent of Funding Available Principal
Receipts therefor until the Seventh Issuer Series 3 Term A
Advance is fully repaid; and
(iv) on each Interest Payment Date falling on or after the
Interest Payment Date on which the Seventh Issuer Series 4
Term AA Advances are fully repaid, the Seventh Issuer Series
4 Term A Advance to the extent of Funding Available
Principal Receipts therefor until the Seventh Issuer Series
4 Term A Advance is fully repaid.
(b) If on any Interest Payment Date amounts are due and payable under
a Seventh Issuer Term A Advance when amounts are also due and
payable under a Seventh Issuer Term AAA Advance and/or a Seventh
Issuer Term AA Advance, then Funding shall apply Funding Available
Principal Receipts to repay the Seventh Issuer Term AA Advance
and/or the Seventh Issuer Term AA Advance in priority to any
amounts due under any Seventh Issuer Term A Advance.
(c) If on any Interest Payment Date amounts are due and payable under
more than one Seventh Issuer Term A Advance, then Funding shall
apply Funding Available Principal Receipts to repay the Seventh
Issuer Term A Advances pro rata according to the respective
amounts thereof.
5.5 DEFERRAL OF REPAYMENTS ON THE SEVENTH ISSUER TERM AA ADVANCES AND THE
SEVENTH ISSUER TERM A ADVANCES FOLLOWING A PRINCIPAL DEFICIENCY
Prior to the occurrence of a Trigger Event, enforcement of the Funding
Security or enforcement of the Seventh Issuer Security, principal
repayments on the Seventh Issuer Term A Advances and the Seventh Issuer
Term AA Advances will be deferred in the circumstances set out in
paragraph 2 of Part II of Schedule 3 to the Funding Deed of Charge.
5.6 REPAYMENT OF SEVENTH ISSUER TERM ADVANCES AFTER THE OCCURRENCE OF A NON-
ASSET TRIGGER EVENT BUT PRIOR TO ENFORCEMENT OF THE FUNDING SECURITY OR
THE SEVENTH ISSUER SECURITY
On and from the Interest Payment Date following the occurrence of a Non-
Asset Trigger Event but prior to enforcement of the Funding Security or
enforcement of the Seventh Issuer Security, Funding shall repay the
Seventh Issuer Term Advances on each Interest Payment Date from Funding
Available Principal Receipts in the manner set out in Part II of Schedule
3 to the Funding Deed of Charge.
5.7 REPAYMENT OF SEVENTH ISSUER TERM ADVANCES AFTER THE OCCURRENCE OF AN
ASSET TRIGGER EVENT BUT PRIOR TO ENFORCEMENT OF THE FUNDING SECURITY OR
ENFORCEMENT OF THE SEVENTH ISSUER SECURITY
Following the occurrence of an Asset Trigger Event but prior to
enforcement of the Funding Security or enforcement of the Seventh Issuer
Security, Funding shall repay the Seventh
8
Issuer Term Advances on each Interest Payment Date from Funding Available
Principal Receipts in the manner set out in Part II of Schedule 3 to the
Funding Deed of Charge.
5.8 REPAYMENT OF SEVENTH ISSUER TERM ADVANCES FOLLOWING ENFORCEMENT OF THE
SEVENTH ISSUER SECURITY BUT PRIOR TO ENFORCEMENT OF THE FUNDING SECURITY
Following the enforcement of the Seventh Issuer Security pursuant to the
terms of the Seventh Issuer Deed of Charge but prior to enforcement of
the Funding Security, Funding shall apply Funding Available Principal
Receipts on each Interest Payment Date as follows:
(a) firstly, pro rata and pari passu according to the respective
amounts outstanding thereof, the Seventh Issuer Series 1 Term AAA
Advance, the Seventh Issuer Series 2 Term AAA Advance, the Seventh
Issuer Series 3 Term AAA Advance and the Seventh Issuer Series 4
Term AAA Advances until all such Seventh Issuer Term AAA Advances
are fully repaid;
(b) secondly, pro rata and pari passu according to the respective
amounts outstanding thereof, the Seventh Issuer Series 1 Term AA
Advance, the Seventh Issuer Series 2 Term AA Advance, the Seventh
Issuer Series 3 Term AA Advance and the Seventh Issuer Series 4
Term AA Advance until all such Seventh Issuer Term AA Advances are
fully repaid; and
(c) thirdly, pro rata and pari passu according to the respective
amounts outstanding thereof, the Seventh Issuer Series 1 Term A
Advance, the Seventh Issuer Series 2 Term A Advance, the Seventh
Issuer Series 3 Term A Advance and the Seventh Issuer Series 4
Term A Advance until all such Seventh Issuer Term A Advances are
fully repaid.
5.9 REPAYMENT FOLLOWING ENFORCEMENT OF THE FUNDING SECURITY
Following the enforcement of the Funding Security pursuant to the terms
of the Funding Deed of Charge, the Seventh Issuer Intercompany Loan shall
be repaid in the manner described in Part III of Schedule 3 to the
Funding Deed of Charge.
5.10 BULLET TERM ADVANCE AND SCHEDULED AMORTISATION TERM ADVANCES DEEMED TO BE
PASS THROUGH TERM ADVANCES
(a) Subject to the terms of Part II of Schedule 3 to the Funding Deed
of Charge, if a Trigger Event occurs, the Seventh Issuer Security
is enforced or the Funding Security is enforced, then monies (if
any) accumulating for the Seventh Issuer Series 1 Term AAA
Advance, the Seventh Issuer Series 2 Term AAA Advance or the
Seventh Issuer Series 3 Term AAA Advance will be available, on and
from the date of the relevant occurrence, for application in
accordance with Clauses 5.6, 5.7, 5.8 or 5.9 hereof (as applicable)
(and for the avoidance of doubt, will not be available solely for
repayment of the Seventh Issuer Series 1 Term AAA Advance and/or
the Seventh Issuer Series 2 Term AAA Advance and/or the Seventh
Issuer Series 3 Term AAA Advance , as applicable, subject to the
terms of Part II of Schedule 3 to the Funding Deed of Charge).
(b) Subject to the terms of Part II of Schedule 3 to the Funding Deed
of Charge, if a Trigger Event occurs, the Funding Security is
enforced or the Seventh Issuer Security is enforced, then (i) the
Scheduled Repayment Dates of the Seventh Issuer Series 1 Term AAA
Advance, the Seventh Issuer Series 2 Term AAA Advance and the
Seventh Issuer Series 3 Term AAA Advance will cease to apply and
(ii) the Seventh
9
Issuer Series 1 Term AAA Advance, the Seventh Issuer Series 2 Term
AAA Advance and the Seventh Issuer Series 3 Term AAA Advance shall
be deemed to be Payable Pass Through Term Advances.
5.11 ACKNOWLEDGEMENT OF FIRST ISSUER INTERCOMPANY LOAN, SECOND ISSUER
INTERCOMPANY LOAN, THIRD ISSUER INTERCOMPANY LOAN, FOURTH INTERCOMPANY
LOAN, FIFTH ISSUER INTERCOMPANY LOAN AND SIXTH ISSUER INTERCOMPANY LOAN
The Seventh Issuer hereby acknowledges and agrees that Funding has
entered into an intercompany loan agreement with ▇▇▇▇▇▇ Financing (No. 1)
PLC (the FIRST ISSUER) dated 26th July, 2000 (the FIRST ISSUER
INTERCOMPANY LOAN AGREEMENT), an intercompany loan agreement with ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ (No. 2) PLC (the SECOND ISSUER) dated 29th November, 2000 (the
SECOND ISSUER INTERCOMPANY LOAN AGREEMENT), an intercompany loan
agreement with ▇▇▇▇▇▇ Financing (No. 3) PLC (the THIRD ISSUER) dated 23rd
May, 2001 (the THIRD ISSUER INTERCOMPANY LOAN AGREEMENT), an intercompany
loan agreement with ▇▇▇▇▇▇ Financing (No.4) PLC (the FOURTH ISSUER) dated
5th July, 2001 (the FOURTH INTERCOMPANY LOAN AGREEMENT), an intercompany
loan agreement with ▇▇▇▇▇▇ Financing (No.5) PLC (the FIFTH ISSUER) dated
8th November, 2001 (the FIFTH INTERCOMPANY LOAN AGREEMENT) and an
intercompany loan agreement with ▇▇▇▇▇▇ Financing (No. 6) PLC (the SIXTH
ISSUER) dated 7th November, 2002 (the SIXTH INTERCOMPANY LOAN AGREEMENT)
and accordingly, the obligation of Funding to repay this Seventh Issuer
Intercompany Loan, the First Issuer Intercompany Loan, the Second Issuer
Intercompany Loan, the Third Issuer Intercompany Loan, the Fourth
Intercompany Loan, the Fifth Intercompany Loan and the Sixth Issuer
Intercompany Loan will depend on the Term Advance Ratings of the various
Term Advances made to Funding under this Seventh Issuer Intercompany Loan
Agreement, the First Issuer Intercompany Loan Agreement, the Second
Issuer Intercompany Loan Agreement, the Third Issuer Intercompany Loan
Agreement, the Fourth Issuer Intercompany Loan Agreement, the Fifth
Issuer Intercompany Loan Agreement and the Sixth Issuer Intercompany Loan
Agreement and the provisions of Schedule 3 to the Funding Deed of Charge.
5.12 ACKNOWLEDGEMENT OF NEW INTERCOMPANY LOANS
The Seventh Issuer hereby acknowledges and agrees that from time to time
Funding may enter into New Intercompany Loans with New Issuers and that
the obligation of Funding to repay this Seventh Issuer Intercompany Loan,
the First Issuer Intercompany Loan, the Second Issuer Intercompany Loan,
the Third Issuer Intercompany Loan, the Fourth Issuer Intercompany Loan,
the Fifth Issuer Intercompany Loan, the Sixth Issuer Intercompany Loan
and any New Intercompany Loan will depend on the Term Advance Rating of
the individual Term Advances made to Funding under any of this Seventh
Issuer Intercompany Loan, the First Issuer Intercompany Loan, the Second
Issuer Intercompany Loan, the Third Issuer Intercompany Loan, the Fourth
Issuer Intercompany Loan, the Fifth Issuer Intercompany Loan and the
Sixth Issuer Intercompany Loan and the provisions of Schedule 3 to the
Funding Deed of Charge. The Seventh Issuer further acknowledges and
agrees that Parts I, II and III of Schedule 3 to the Funding Deed of
Charge will be amended to reflect the entry by Funding into New
Intercompany Loans and related agreements from time to time and agrees to
execute such documents as are necessary or required by the Rating
Agencies or otherwise for the purpose of including the New Issuer, any
New Funding Swap Provider, any New Start-up Loan Provider or any other
person who has executed an Accession Undertaking in the Transaction
Documents.
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6. PREPAYMENT
6.1 PREPAYMENT OF SEVENTH ISSUER TERM ADVANCES
If the new Basel Capital Accord (as described in the consultative
document "The New Basel Capital Accord" published in January 2001 by the
Basel Committee on Banking Supervision) has been implemented in the
United Kingdom, whether by rule of law, recommendation of best practices
or by any other regulation and PROVIDED THAT a Seventh Issuer Note
Enforcement Notice has not been served, then Funding may, on any Interest
Payment Date on or after the Interest Payment Date falling in April 2007,
having given not more than 60 days and not less than 30 days' (or such
shorter period as may be agreed with the Seventh Issuer and the Security
Trustee) prior written notice to the Seventh Issuer and the Security
Trustee, prepay all but not some only of all of the Seventh Issuer
Term Advances without penalty or premium but subject to CLAUSE 15
(Default interest and indemnity) of the Intercompany Loan Terms and
Conditions.
6.2 APPLICATION OF MONIES
The Seventh Issuer hereby agrees to apply any amounts received by way of
prepayment pursuant to CLAUSE 6.1 (Prepayment of Seventh Issuer Term
Advances) in making prepayments under the Seventh Issuer Notes.
7. CERTAIN FEES, ETC.
7.1 FEE FOR PROVISION OF SEVENTH ISSUER TERM ADVANCES
Funding shall (except in the case of payments due under paragraphs (c),
(e), (f) and (j) below, which shall be paid when due) on each Interest
Payment Date pay to the Seventh Issuer for same day value to the Seventh
Issuer Sterling Account a fee for the provision of the Seventh Issuer
Term Advances. Such fee shall be an amount or amounts in the aggregate
equal to the following:
(a) the fees, costs, charges, liabilities and expenses and any other
amounts due and payable to the Seventh Issuer Security Trustee
pursuant to the Seventh Issuer Deed of Charge together with
interest thereon as provided therein;
(b) the fees, costs, charges, liabilities and expenses and any other
amounts due and payable to the Note Trustee pursuant to the
Seventh Issuer Trust Deed together with interest thereon as
provided therein;
(c) the reasonable fees and expenses of any legal advisers,
accountants and auditors appointed by the Seventh Issuer and
properly incurred in their performance of their functions under
the Transaction Documents which have fallen due;
(d) the fees, costs and expenses due and payable to the Paying Agents,
the Registrar, the Transfer Agent and the Agent Bank pursuant to
the Seventh Issuer Paying Agent and Agent Bank Agreement;
(e) any amounts due and payable by the Seventh Issuer to the Inland
Revenue in respect of the Seventh Issuer's liability to United
Kingdom corporation tax (insofar as payment is not satisfied by
the surrender of group relief or out of the profits, income or
gains of the Seventh Issuer and subject to the terms of the
Seventh Issuer Deed of Charge) or any other Taxes payable by the
Seventh Issuer;
(f) the fees, costs, charges, liabilities and expenses due and payable
to the Seventh Issuer Account Banks, pursuant to the Seventh
Issuer Bank Account Agreement (if any);
11
(g) the fees, costs, charges, liabilities and expenses due and payable
to the Seventh Issuer Cash Manager, pursuant to the Seventh Issuer
Cash Management Agreement;
(h) any termination payment due and payable by the Seventh Issuer to
any Seventh Issuer Swap Provider, pursuant to any Seventh Issuer
Swap Agreement;
(i) the fees, costs, charges and liabilities and expenses due and
payable to the Corporate Services Provider pursuant to the Seventh
Issuer Corporate Services Agreement;
(j) an amount equal to "G" where G is calculated as follows:
G = (A- D- H) or, if such calculation is less than zero, then G
shall be zero
where,
A = 0.01 per cent of the interest amounts paid by Funding to the
Seventh Issuer on the Seventh Issuer Term Advances on the
immediately preceding Interest Payment Date;
D = E - F
where,
E = the interest amounts (which excludes those fee amounts in
this Clause ) paid by Funding to the Seventh Issuer on the Seventh
Issuer Term Advances on the immediately preceding Interest Payment
Date; and
F = amounts paid by the Seventh Issuer under paragraphs (e) to
(i) of the Seventh Issuer Pre-Enforcement Revenue Priority of
Payments on the immediately preceding Interest Payment Date;
and
H = the cumulative aggregate of (D - A) as calculated on each
previous Interest Payment Date. If such cumulative aggregate of (D
- A) is less than zero, then H shall be zero;
(k) any other amounts due or overdue by the Seventh Issuer to third
parties including the Rating Agencies and the amounts paid by the
Seventh Issuer under the Subscription Agreements and the
Underwriting Agreement (excluding, for these purposes, the
Noteholders) other than amounts specified in paragraphs (b) to (k)
above; and
(l) if on any Interest Payment Date there are Seventh Issuer Principal
Receipts remaining in the Seventh Issuer Bank Accounts, an amount
equal to the difference between (i) the interest that would be
earned by the Seventh Issuer on such Seventh Issuer Principal
Receipts remaining in the Seventh Issuer Bank Accounts during the
next succeeding Interest Period and (ii) the interest that would
be payable by the Seventh Issuer applying the weighted average
rate of interest payable on the relevant Seventh Issuer Currency
Swap Agreement due for repayment at the end of that Interest
Period to such Seventh Issuer Principal Receipts remaining in the
Seventh Issuer Bank Accounts,
together with, (i) in respect of taxable supplies made to the Seventh
Issuer, an amount in respect of any value added tax or similar tax
payable in respect thereof against production of a
12
valid tax invoice; and (ii) in respect of taxable supplies made to a
person other than the Seventh Issuer, any amount in respect of any
Irrecoverable VAT or similar tax payable in respect thereof (against
production of a copy of the relevant tax invoice), and to be applied
subject to and in accordance with the provisions of the Seventh Issuer
Pre-Enforcement Revenue Priority of Payments in the Seventh Issuer Cash
Management Agreement.
7.2 SET-OFF
Funding and each of the other parties to the Seventh Issuer Intercompany
Loan Agreement agree that the Seventh Issuer shall be entitled to set-off
those amounts due and payable by Funding pursuant to this Clause on the
Closing Date against the amount to be advanced by the Seventh Issuer to
Funding by way of the Seventh Issuer Term Advances on the Closing Date.
8. APPLICATION OF CERTAIN PROVISIONS
The provisions set out in Clause 4.2 (Limited Recourse) of the
Intercompany Loan Term and Conditions shall apply to:
(a) the Seventh Issuer Term AA Advances;
(b) the Seventh Issuer Term A Advances; and
(c) the Seventh Issuer Term BBB Advances.
9. DECLARATION OF TRUST
The Seventh Issuer declares the Security Trustee, and the Security
Trustee hereby declares itself, trustee of all the covenants,
undertakings, rights, powers, authorities and discretions in, under or in
connection with this Agreement for the Seventh Issuer Secured Creditors
in respect of the Seventh Issuer Secured Obligations owed to each of them
respectively upon and subject to the terms and conditions of the Seventh
Issuer Deed of Charge.
10. ADDRESSES
The addresses referred to in Clause 18.4 of the Intercompany Loan Terms
and Conditions are as follows:
THE SECURITY TRUSTEE:
For the attention of: Manager, Trust Administration
Address: Trinity Tower, ▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Facsimile: (▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
THE SEVENTH ISSUER:
For the attention of: Securitisation Team, Retail Customer Risk and Decisioning
Address: ▇▇▇▇▇▇ Financing (No. 7) PLC c/o Abbey House (AAM ▇▇▇), ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Facsimile: (▇▇) ▇▇▇▇ ▇▇▇ ▇▇▇
13
FUNDING:
For the attention of: Securitisation Team, Retail Customer Risk and Decisioning
Address: ▇▇▇▇▇▇ Funding Limited c/o Abbey House (AAM ▇▇▇), ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Facsimile: (▇▇) ▇▇▇▇ ▇▇▇ ▇▇▇
RATING AGENCIES:
▇▇▇▇▇'▇:
Address: ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
For the attention of: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone:
Facsimile: (▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
(▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
S&P:
Address: Garden House
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
For the attention of: Structured Finance Surveillance Group
Telephone:
Facsimile: (▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
(▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
FITCH:
Address: ▇▇▇▇▇ House
▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
For the attention of: European Structured Finance
Telephone:
Facsimile: (▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
(▇▇) ▇▇ ▇▇▇▇ ▇▇▇▇
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SCHEDULE 1
CONDITIONS PRECEDENT IN RESPECT OF DRAWDOWN
1. AUTHORISATIONS
(a) A copy of the memorandum and articles of association, certificate of
incorporation and certificate of incorporation on change of name of
Funding.
(b) A copy of a resolution of the board of directors of Funding authorising
the entry into, execution and performance of each of the Transaction
Documents to which Funding is a party and authorising specified persons
to execute those on its behalf.
(c) A certificate of a director of Funding certifying:
(i) that each document delivered under this paragraph 1 of Schedule 1
is correct, complete and in full force and effect as at a date no
later than the date of execution of the Seventh Issuer
Intercompany Loan Agreement and undertaking to notify the Security
Trustee if that position should change prior to the first Drawdown
Date; and
(ii) as to the identity and specimen signatures of the directors and
signatories of Funding.
2. SECURITY
(a) The Funding Deed of Charge duly executed by the parties thereto.
(b) Duly completed bank account mandates in respect of the Funding GIC
Account and the Funding Transaction Account.
(c) Security Power of Attorney for Funding.
3. LEGAL OPINION
Legal opinions of:
(a) ▇▇▇▇▇ & ▇▇▇▇▇, English legal advisers, addressed to the Security
Trustee;
(b) ▇▇▇▇▇▇▇▇▇ and May, English legal advisers to the Seller, the
Seventh Issuer and Funding, addressed to the Security Trustee;
(c) ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, U.S. legal advisers to the
Seller, the Seventh Issuer and Funding, addressed to the Security
Trustee; and
(d) ▇▇▇▇ ▇▇▇▇▇▇ ▇▇, Scottish legal advisors, addressed to the Security
Trustee.
4. TRANSACTION DOCUMENTS
▇▇▇▇ executed copies of:
(a) the Servicing Agreement;
(b) the Mortgages Trust Deed;
(c) the Abbey Deed and Power of Attorney;
15
(d) the Funding Deed of Charge;
(e) the Funding Swap Agreement (including the Deed of Amendment);
(f) the Corporate Services Agreement;
(g) the Funding Liquidity Facility Agreement (including the Amendment
Agreement to the Funding Liquidity Facility Agreement);
(h) the First Intercompany Loan Agreement, the Second Intercompany
Loan Agreement, the Third Intercompany Loan Agreement, the Fourth
Intercompany Loan Agreement, the Fifth Intercompany Loan
Agreement, the Sixth Intercompany Loan Agreement and the Seventh
Intercompany Loan Agreement;
(i) the Cash Management Agreement (including the Amendment Agreement
to Cash Management Agreement);
(j) the Bank Account Agreement;
(k) the Funding Guaranteed Investment Contract;
(l) the First Start-up Loan Agreement, the Second Start-up Loan
Agreement, the Third Start-up Loan Agreement, the Fourth Start-up
Loan Agreement, the Fifth Start-up Loan Agreement, the Sixth
Start-up Loan Agreement and the Seventh Start-up Loan Agreement;
(m) the Seller Power of Attorney;
(n) the Insurance Acknowledgements;
(o) the Seventh Issuer Deed of Charge;
(p) the Seventh Issuer Cash Management Agreement;
(q) the Currency Swap Agreements;
(r) the Seventh Issuer Bank Account Agreement;
(s) the Seventh Issuer Post-Enforcement Call Option Agreement;
(t) the Seventh Issuer Corporate Services Agreement;
(u) the Seventh Issuer Trust Deed;
(v) the Seventh Issuer Global Notes;
(w) the Seventh Issuer Paying Agent and Agent Bank Agreement;
(x) the Mortgages Trustee Guaranteed Investment Contract; and
(y) the Amended and Restated Master Definitions and Construction
Schedule, the First Issuer Master Definitions and Construction
Schedule, the Second Issuer Master Definitions and Construction
Schedule, the Third Issuer Master Definitions and Construction
Schedule, the Fourth Issuer Master Definitions and Construction
Schedule, the Fifth Issuer Master Definitions and Construction
Schedule, the Sixth Issuer Master Definitions and Construction
Schedule and the Seventh Issuer Master Definitions and
Construction Schedule.
16
5. BOND DOCUMENTATION
(a) Confirmation that the Seventh Issuer Notes have been issued and the
subscription proceeds received by the Seventh Issuer; and
(b) Copy of the Prospectus and the Offering Circular.
6. MISCELLANEOUS
Solvency certificates from Funding signed by two directors of Funding in
or substantially in the form set out in Schedule 2 to the Intercompany
Loan Terms and Conditions.
IN WITNESS WHEREOF the parties have caused this Agreement to be duly executed
on the day and year appearing on page 1.
17
SIGNATORIES
FUNDING
SIGNED for and on behalf of )
▇▇▇▇▇▇ FUNDING LIMITED )
SEVENTH ISSUER
SIGNED for and on behalf of )
▇▇▇▇▇▇ FINANCING (NO. 7) PLC )
SECURITY TRUSTEE AND
AGENT BANK
SIGNED for and on behalf of )
JPMORGAN CHASE BANK, )
LONDON BRANCH )
18