EXHIBIT 4.1.1
Execution Version
Dated 19 January, 2005
GRANITE FINANCE FUNDING 2 LIMITED
as Funding 2
GRANITE MASTER ISSUER PLC
as Master Issuer
THE BANK OF NEW YORK
as Funding 2 Security Trustee
-and -
CITIBANK, N.A.
as Agent Bank
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GLOBAL INTERCOMPANY LOAN AGREEMENT
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SIDLEY ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇
WOOLGATE EXCHANGE
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
TELEPHONE ▇▇▇ ▇▇▇▇ ▇▇▇▇
FACSIMILE 020 7626 7937
REF:30507-30040/678952
CONTENTS
1. Interpretation.......................................................1
2. The Facility.........................................................1
3. The Loan Tranches....................................................1
4. Purpose..............................................................3
5. Limited Recourse.....................................................3
6. Advance of Loan Tranches.............................................4
7. Interest.............................................................5
8. Repayment............................................................9
9. Prepayment..........................................................10
10. Taxes...............................................................10
11. Illegality..........................................................11
12. Mitigation..........................................................11
13. Representations and Warranties of Funding 2.........................12
14. Covenants...........................................................13
15. Default.............................................................16
16. Default Interest and Indemnity......................................18
17. Payments............................................................19
18. Entrenched Provisions...............................................19
19. Further Provisions..................................................20
20. Redenomination......................................................21
21. Notices.............................................................22
22. Governing Law and Submission to Jurisdiction........................22
SCHEDULE 1 FORM OF LOAN TRANCHE NOTICE...................................24
SCHEDULE 2 FORM OF LOAN TRANCHE SUPPLEMENT...............................25
I
THIS AGREEMENT is dated 19 January, 2005
BETWEEN:
(1) GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249387), a private
limited company incorporated under the laws of England and Wales whose
registered office is at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ as
Funding 2;
(2) GRANITE MASTER ISSUER PLC (registered number 5250668), a public limited
company incorporated under the laws of England and Wales whose
registered office is at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ as
Master Issuer;
(3) THE BANK OF NEW YORK, a New York banking corporation acting through its
office at ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ in its capacity
as Funding 2 Security Trustee; and
(4) CITIBANK, N.A., acting through its office at ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ in its capacity as Agent Bank.
WHEREAS:
(A) From time to time, the Master Issuer will issue Notes pursuant to the
Programme.
(B) The Master Issuer has agreed that it will lend the proceeds (or, as
applicable, the sterling equivalent thereof) of any issue of Notes by it
to Funding 2.
(C) This Agreement sets out the terms and conditions with respect to lending
by the Master Issuer of the proceeds of the issue of Notes to Funding 2.
1. Interpretation
1.1 The provisions of the Programme Master Definitions Schedule signed for
the purposes of identification by Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ and ▇▇▇▇▇ &
Overy LLP on 19 January, 2005 (as the same have been and may be amended,
varied or supplemented from time to time with the consent of the parties
hereto) are expressly and specifically incorporated into and shall apply
to this Agreement.
2. The Facility
2.1 Subject to the terms of this Agreement, the Master Issuer agrees to make
available to Funding 2 a facility in an aggregate amount equal to the
Total Credit Commitment (the "Global Loan Facility"). On the London
Business Day prior to each Closing Date, the Master Issuer shall offer
Loan Tranches to Funding 2 under the Global Loan Facility that
correspond to each Series and Class of Notes to be issued by the Master
Issuer on the following Closing Date. Each Loan Tranche shall be
denominated in Sterling. Subject to the terms of this Agreement, on each
Closing Date Funding 2 shall accept the offer.
3. The Loan Tranches
3.1 Conditions precedent: Save as the Master Issuer, Funding 2 and the
Funding 2 Security Trustee may otherwise agree, each Loan Tranche
will not be available for
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utilisation on a Closing Date unless:
(a) the related Series and Class of Notes has been issued by the
Master Issuer on the relevant Closing Date and the subscription
proceeds thereof have been received by or on behalf of the Master
Issuer;
(b) not later than 2.00 pm (London time) on the relevant Closing Date,
Funding 2 and the Master Issuer have signed a Loan Tranche
Supplement (generally in the form set out in Schedule 2 (Form of
Loan Tranche Supplement)) which shall oblige Funding 2 to borrow
the whole amount stated in the Loan Tranche Supplement on the
Closing Date subject to the terms of this Agreement;
(c) Funding 2 has confirmed in the applicable Loan Tranche Supplement
that:
(i) no Funding 2 Intercompany Loan Event of Default has occurred
and is continuing unremedied (if capable of remedy) or
unwaived or would result from the making of such Loan
Tranche;
(ii) the representations set out in Clause 13 (Representations
and Warranties of Funding 2) are true on and as of the
Closing Date by reference to the facts and circumstances
then existing;
(iii) there is no debit balance on the Funding 2 Principal
Deficiency Ledger;
(d) Funding 2 has delivered to the Funding 2 Security Trustee a
solvency certificate in form and substance satisfactory to the
Funding 2 Security Trustee;
(e) the Master Issuer has confirmed in the applicable Loan Tranche
Supplement that:
(i) no Issuer Event of Default has occurred and is continuing
unremedied (if capable of remedy) or unwaived or would
result from the making of such Loan Tranche; and
(ii) the aggregate amount of the Loan Tranches to be made on such
Closing Date and any Loan Tranches outstanding on such
Closing Date do not exceed the Total Credit Commitment;
(f) each of the Rating Agencies has confirmed in writing to the
Funding 2 Security Trustee and the Issuer Security Trustee that
there will not, as a result of the Master Issuer issuing any
Notes, be any reduction, withdrawal or qualification of the then
current ratings by the Rating Agencies of any existing Notes; and
(g) all other conditions precedent as may be specified in the
applicable Loan Tranche Supplement have been satisfied.
2
4. Purpose
4.1 Purpose and application of a Loan Tranche: The proceeds of each Loan
Tranche may only be used by Funding 2 either:
(a) to make a Contribution (excluding a Deferred Contribution) to the
Mortgages Trustee (which shall increase the Funding 2 Share of the
Trust Property in accordance with the terms of the Mortgages Trust
Deed); and/or
(b) to refinance the existing debt of Funding 2, including any
existing Loan Tranche (in whole or in part); and/or
(c) to fund or partly fund or replenish the Funding 2 Reserve Fund or
make a deposit into the Funding 2 GIC Account.
4.2 Application of amounts: Without prejudice to the obligations of Funding
2 under this Clause 4, neither the Funding 2 Security Trustee nor any of
the Funding 2 Secured Creditors shall be obliged to concern themselves
as to the application of amounts raised by Funding 2 under a Loan
Tranche.
5. Limited Recourse
5.1 Recourse limited to available funds: Subject to Clause 5.2 (Shortfall on
Final Repayment Date) but notwithstanding the terms of any other
provision in this Agreement or any other Transaction Document, each of
the Master Issuer and the Funding 2 Security Trustee agree that the
liability of Funding 2 in respect of its obligations to repay principal
and pay interest or any other amounts due under this Agreement or for
any breach of any other representation, warranty, covenant or
undertaking of Funding 2 under this Agreement shall be limited to:
(a) in respect of amounts payable prior to the enforcement of the
Funding 2 Security:
(i) the amount of Funding 2 Available Revenue Receipts in
respect of interest, fees or other amounts (but excluding
principal) payable by Funding 2 to the Master Issuer, but
only to the extent of an amount of Funding 2 Available
Revenue Receipts remaining after paying amounts of a higher
order of priority and providing for amounts payable pari
passu therewith in accordance with, and subject to, the
relevant Funding 2 Pre-Enforcement Revenue Priority of
Payments; and
(ii) the amount of Funding 2 Available Principal Receipts in
respect of principal payable by Funding 2 to the Master
Issuer, but only to the extent of the amount of Funding 2
Available Principal Receipts remaining after paying amounts
of a higher priority and providing for amounts pari passu
therewith, and subject to, the rules set forth in the
Funding 2 Pre-Enforcement Principal Priority of Payments;
and
(b) in respect of amounts payable following enforcement of the Funding
2 Security, amounts received or recovered by Funding 2, the
Funding 2 Security Trustee or any Receiver appointed on behalf of
the Funding 2 Security
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Trustee, but only to the extent of such amount thereof as remains
after paying amounts of a higher order of priority and providing
for amounts payable pari passu therewith in accordance with, and
subject to, the Funding 2 Post-Enforcement Priority of Payments,
provided that the application of such amounts set forth in sub-clauses
(a) and (b) above to the discharge of Funding 2's obligations under this
Agreement shall be subject to the terms of the Funding 2 Deed of Charge.
5.2 Shortfall on Final Repayment Date: To the extent that on the latest
occurring Final Repayment Date of any Loan Tranche advanced under this
Agreement there is a shortfall between all amounts (including interest
and principal) payable under this Agreement and the amounts available
therefor, that shortfall shall become immediately due and payable to the
Master Issuer. Following enforcement of the Funding 2 Security and
distribution of all enforcement proceeds in accordance with the Funding
2 Deed of Charge, all outstanding claims that the Master Issuer may
otherwise have against Funding 2 will be extinguished.
6. Advance of Loan Tranches
6.1 Notice to Funding 2: On the London Business Day prior to each Closing
Date, the Master Issuer shall give to Funding 2 (copied to the Funding 2
Security Trustee) a Loan Tranche Notice (generally in the form set out
in Schedule 1 (Form of Loan Tranche Notice)) setting out, inter alia:
(a) the amount and currency or currencies of the proposed issue on the
next London Business Day of each Series and Class of Notes under
the Programme;
(b) the Specified Currency Exchange Rate(s) at which the Master Issuer
will swap the proceeds of each Series and Class of Notes that is
not denominated in Sterling into Sterling; and
(c) the principal amount of each Loan Tranche available for drawing
under the Global Loan Facility on the next Closing Date.
6.2 Loan Tranches correspond to Series and Classes of Notes: Each Loan
Tranche shall be identified by reference to the relevant Series and
Class of Notes that is used to fund it, as set out in the applicable
Loan Tranche Supplement. For instance, the Series 05-1 Class A1 Notes
shall fund the Series 05-1 AAA (Class A1) Loan Tranche.
6.3 Loan Tranche Supplement: The Loan Tranche Supplement to be signed on
each Closing Date in accordance with Clause 3.1(b) shall record, amongst
other things, the amount of each Loan Tranche to be made on such Closing
Date, which shall correspond to the principal amount of such Loan
Tranche that is available for drawing which is notified to Funding 2 in
the applicable Loan Tranche Notice.
6.4 Single drawing of the Loan Tranche: On satisfaction of the conditions
set out in Clause 3.1 (Conditions Precedent), the Master Issuer shall
make the applicable Loan Tranches available to Funding 2 on the
applicable Closing Date. The aggregate of the Loan Tranches to be made
on such Closing Date will only be available for drawing in
4
one amount by Funding 2 on the such Closing Date.
6.5 Redemption/Payment Basis: Each Loan Tranche may be an Index-Linked
Redemption Loan Tranche, a Bullet Loan Tranche, a Scheduled Repayment
Loan Tranche, a Controlled Repayment Loan Tranche, a Pass-Through Loan
Tranche or a combination of any of the foregoing, depending upon the
Redemption/Payment Basis shown in the applicable Loan Tranche
Supplement.
6.6 Issuance Fees: The Master Issuer shall, on behalf of Funding 2 and
itself, pay the fees and expenses incurred by Funding 2 and/or itself in
connection with the issuance of Notes, the making of Loan Tranches by it
to Funding 2 and the acquisition by Funding 2 of an additional share in
the Trust Property using the proceeds of such Loan Tranches.
7. Interest
7.1 Loan Tranche Interest Periods: The first Loan Tranche Interest Period in
respect of a Loan Tranche will commence on (and include) the Loan
Tranche Interest Commencement Date relating to that Loan Tranche and end
on (but exclude) the first Loan Payment Date falling thereafter. Each
subsequent Loan Tranche Interest Period shall commence on (and include)
a Loan Payment Date and end on (but exclude) the next following Loan
Payment Date.
7.2 Day Count Fraction: Whenever it is necessary to compute an amount of
interest in respect of a Loan Tranche for any period (including any Loan
Tranche Interest Period), such interest shall be calculated on the basis
of actual days elapsed in a 365 day year.
7.3 Determination of Intercompany Loan Tranche Interest Amount: In relation
to any Loan Tranche, the rate of interest payable (the "Loan Tranche
Rate of Interest") and the relevant Sterling interest amount (each an
"Loan Tranche Interest Amount") in respect of such Loan Tranche shall be
determined on the basis of the provisions set out below:
(a) On the Loan Tranche Interest Reset Date in relation to such Loan
Tranche, the Agent Bank will determine the Relevant Screen Rate in
respect of such Loan Tranche at or about 11.00 am London time.
If the Relevant Screen Rate is unavailable, the Agent Bank will
request the principal London Office of each of the Reference Banks
to provide the Agent Bank with its offered quotation to leading
Banks for Sterling Deposits of (pound)10,000,000 for the Loan
Reference Rate in the London inter-bank market as at or about
11.00 am London time on such Loan Tranche Interest Reset Date.
The Loan Tranche Rate of Interest for such Loan Tranche for the
Loan Tranche Interest Period relating to such Loan Tranche shall
be the aggregate of:
(i) the Relevant Margin in respect of such Loan Tranche; and
(ii) the Relevant Screen Rate in respect of such Loan Tranche or,
if the Relevant Screen Rate is unavailable, the arithmetic
mean (or, in the
5
case of the initial Loan Tranche Interest Determination Date
for such Loan Tranche, the linear interpolation of the
arithmetic mean) of such offered quotations by the Reference
Banks (rounded upwards, if necessary, to five decimal
places).
(b) If on any Loan Tranche Interest Reset Date in relation to such
Loan Tranche, the Relevant Screen Rate in respect of such Loan
Tranche is unavailable and only two or three of the Reference
Banks provide offered quotations, the Loan Tranche Rate of
Interest for such Loan Tranche for the relevant Loan Tranche
Interest Period shall be determined in accordance with the
provisions of sub-paragraph (a) above on the basis of the offered
quotations of those Reference Banks providing such quotations.
(c) If, on any such Loan Tranche Interest Reset Date, only one or none
of the Reference Banks provides the Agent Bank with such an
offered quotation, the Agent Bank shall forthwith consult with the
Funding 2 Security Trustee for the purposes of agreeing two banks
(or, where one only of the Reference Banks provided such a
quotation, one additional bank) to provide such a quotation or
quotations to the Agent Bank (which bank or banks are in the
opinion of the Funding 2 Security Trustee suitable for such
purpose) and the Loan Tranche Rate of Interest for such Loan
Tranche for the Loan Tranche Interest Period in question shall be
determined, as aforesaid, on the basis of the offered quotations
of such banks as so agreed (or, as the case may be, the offered
quotations of such bank as so agreed and the relevant Reference
Bank).
(d) If no such bank or banks is or are so agreed or such bank or banks
as so agreed does or do not provide such a quotation or
quotations, then the Loan Tranche Rate of Interest for such Loan
Tranche for the relevant Loan Tranche Interest Periods shall be
the Loan Tranche Rate of Interest in relation to such Loan Tranche
in effect for the immediately preceding Loan Tranche Interest
Period to which sub-paragraph (a) above shall have applied but
taking account of any change in the Relevant Margin in relation to
such Loan Tranche.
(e) There will be no minimum or maximum Loan Tranche Rate of Interest
for such Loan Tranche.
(f) The Agent Bank shall: (i) as soon as practicable on each Loan
Tranche Interest Reset Date, determine and notify the Master
Issuer, Funding 2, the Cash Manager and the Funding 2 Security
Trustee of the Loan Tranche Rate of Interest applicable to such
Loan Tranche for the relevant Loan Tranche Interest Periods and
(ii) as soon as practicable on each Loan Interest Determination
Date determine and notify the Master Issuer, Funding 2, the Cash
Manager and the Funding 2 Security Trustee of the Loan Tranche
Interest Amount payable in respect of such Loan Tranche for the
relevant Loan Tranche Interest Period.
(g) The Loan Tranche Interest Amount for such Loan Tranche shall be
determined by applying the relevant Loan Tranche Rate of Interest
to the Outstanding Principal Balance of such Loan Tranche,
multiplying the sum by the day count fraction described in Clause
7.2 (Day Count Fraction) and rounding the resultant figure to the
nearest ▇▇▇▇▇ (half a ▇▇▇▇▇ being rounded upwards).
6
(h) If the Agent Bank does not at any time for any reason determine
the Loan Tranche Rate of Interest and the Loan Tranche Interest
Amount for any Loan Tranche in accordance with 7.2(a) to (g)
above, the Funding 2 Security Trustee shall (subject to it being
indemnified to its satisfaction) determine the Loan Tranche Rate
of Interest and Loan Tranche Interest Amount for each Loan Tranche
and any such determination shall be deemed to have been made by
the Agent Bank.
(i) All notifications, opinions, determinations, certificates,
calculations and decisions given, expressed, made or obtained for
the purposes of this Clause 7, whether by the Agent Bank or the
Funding 2 Security Trustee, shall (in the absence of wilful
default, bad faith or manifest error) be binding on Funding 2, the
Master Issuer, the Cash Manager, the Agent Bank, the Funding 2
Security Trustee and (in such absence as aforesaid) no liability
to Funding 2 shall attach to such Master Issuer, the Agent Bank,
the Funding 2 Security Trustee or the Cash Manager in connection
with the exercise or non-exercise by them or any of them of their
powers, duties and discretions hereunder.
(j) In the event of the then Agent Bank being unwilling to act as the
Agent Bank, or resigning pursuant to the Issuer Paying Agent and
Agent Bank Agreement, the Master Issuer shall, with the approval
of the Issuer Security Trustee, appoint a successor Agent Bank. If
the Master Issuer shall fail to appoint a successor Agent Bank,
the Agent Bank shall appoint such other bank as may be previously
approved in writing by the Issuer Security Trustee to act as the
Agent Bank. The resignation of the Agent Bank will not take effect
until a successor approved by the Issuer Security Trustee has been
appointed.
7.4 Payment on Loan Payment Dates: Subject to Clause 5.1 (Recourse limited
to available funds), Funding 2 shall pay interest in respect of each
Loan Tranche on the Loan Payment Dates specified in the applicable Loan
Tranche Supplement.
7.5 Deferred Interest: Subject to Clause 5.2 (Shortfall on Final Repayment
Date), to the extent that there are insufficient funds available to pay
interest on a Loan Tranche on any Loan Payment Date, the shortfall in
the interest amount payable will not then fall due but will instead be
due on the following Loan Payment Date on which sufficient funds are
available to pay such interest, and pending such payment, will accrue
interest at the rate specified for such Loan Tranche in the applicable
Loan Tranche Supplement.
7.6 Certain Fees: In addition to the interest and principal payments to be
made by Funding 2 in respect of each Loan Tranche under this Clause 7
and Clause 8 (Repayment), respectively, on each Loan Payment Date (or,
in respect of the payment to be made as set forth in (a) below, on the
Closing Date for each Loan Tranche) or on any other date on which the
Master Issuer notifies Funding 2, but subject to Clause 5.1 (Recourse
limited to available funds), Funding 2 shall pay to the Master Issuer
for same day value to the Issuer Transaction Account a fee for the
provision of the Global Loan Facility (except that in the case of
payments due under paragraphs (c), (e), (f) and (k) below, such payments
shall be paid when due). Such fee shall be an amount or amounts in the
aggregate equal to the following:
7
(a) the Issuance Fees (other than to the extent such Issuance Fees are
specified in items (b) to (k) below);
(b) the fees, costs, charges, liabilities and expenses and any other
amounts due and payable to the Note Trustee and the Issuer
Security Trustee pursuant to the Issuer Trust Deed, the Issuer
Deed of Charge or any other Transaction Document, together with
interest thereon as provided therein;
(c) the reasonable fees and expenses of any legal advisers,
accountants and auditors appointed by the Master 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 Agent Bank, the Transfer Agent and the Registrar pursuant to
the Issuer Paying Agent and Agent Bank Agreement;
(e) any amounts due and payable by the Master Issuer to the Inland
Revenue in respect of the Master 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 Master Issuer and subject to the terms of the Issuer
Deed of Charge) or any other Taxes payable by the Master Issuer;
(f) the fees, costs, charges, liabilities and expenses due and payable
to the Issuer Account Bank pursuant to the Issuer Bank Account
Agreement (if any);
(g) the fees, costs, charges, liabilities and expenses due and payable
to the Issuer Cash Manager pursuant to the Issuer Cash Management
Agreement;
(h) any termination payment due and payable by the Master Issuer to an
Issuer Swap Provider pursuant to an Issuer Swap Agreement;
(i) the fees, costs, charges, liabilities and expenses due and payable
to the Issuer Corporate Services Provider pursuant to the Issuer
Corporate Services Agreement;
(j) any amounts due and payable (other than principal) by the Master
Issuer to the Start-Up Loan Provider(s) in respect of the Master
Issuer's obligations under the Start-Up Loan Agreements; and
(k) any other amounts due or overdue by the Master Issuer to third
parties including the Rating Agencies and the amounts paid by the
Master Issuer under the Programme Agreement, each Subscription
Agreement and each Underwriting Agreement (excluding, for these
purposes, the Noteholders) other than amounts specified in
paragraphs (b) to (j) above,
together with, (i) in respect of taxable supplies made to the Master
Issuer, any amount in respect of any VAT or similar tax payable in
respect thereof against production of a valid tax invoice; and (ii) in
respect of taxable supplies made to a person other than the Master
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 Issuer Pre-
8
Enforcement Revenue Priority of Payments in the Issuer Cash
Management Agreement.
7.7 Set-off: Funding 2 and each of the other parties to this Agreement agree
that the Master Issuer shall be entitled to set-off those amounts due
and payable by Funding 2 pursuant to Clause 7.6 (Certain Fees) on the
Closing Date for a Loan Tranche against the amount to be advanced by the
Master Issuer to Funding 2 under such Loan Tranche on such Closing Date.
8. Repayment
8.1 Repayment of Loan Tranches: Subject to Clause 5 (Limited Recourse), on
each Loan Payment Date, other than a Loan Payment Date on which a Loan
Tranche is to be repaid under Clause 9 (Prepayment), Funding 2 shall
repay principal in respect of such Loan Tranche in an amount equal to:
(a) prior to the earlier to occur of the Step-Up Date (if any) in
respect of such Loan Tranche and a Pass-Through Trigger Event, the
lower of:
(i) the amount due to be paid on such Loan Payment Date as
specified for such Loan Tranche in the applicable Loan
Tranche Supplement; and
(ii) the amount which is available, under the terms of the
Funding 2 Deed of Charge and the Cash Management Agreement
to repay principal in respect of such Loan Tranche,
provided that, in the case of any Pass-Through Loan Tranche, the
amount of principal to be repaid by Funding 2 in respect of such
Loan Tranche on the applicable Loan Payment Date shall be
calculated in accordance with sub-paragraph (ii) above; or
(b) following the earlier to occur of the Step-Up Date (if any) in
respect of such Loan Tranche and a Pass-Through Trigger Event
(whereupon each following Monthly Payment Date shall constitute a
Loan Payment Date), the amount which is available under the terms
of the Funding 2 Deed of Charge and the Cash Management Agreement
to repay principal in respect of such Loan Tranche.
To the extent that there are insufficient funds available to Funding 2
to repay the amount due to be paid on such Loan Payment Date, Funding 2
will be required to repay the shortfall, to the extent that it receives
funds therefor (and subject to the terms of the Funding 2 Deed of Charge
and the Cash Management Agreement) on subsequent Loan Payment Dates in
respect of such Loan Tranche.
8.2 Loan Tranche Ratings: Unless otherwise specified for any Loan Tranche in
the applicable Loan Tranche Supplement, such Loan Tranche shall be
repaid (as to both interest and principal) in the priority according to
the Loan Tranche Rating of that Loan Tranche. The Loan Tranche Rating
for a Loan Tranche will be specified for such Loan Tranche in the
applicable Loan Tranche Supplement.
8.3 Payment subject to terms of the Funding 2 Deed of Charge: The terms and
conditions of Clause 7 (Interest) and this Clause 8 (Repayment) are to
be read in
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conjunction with the provisions of Schedule 3 to the Funding 2 Deed of
Charge, as the same may be amended or varied from time to time in
accordance with the provisions thereof.
9. Prepayment
9.1 Prepayment for taxation or other reasons: If:
(a) Funding 2 is required to withhold or deduct from any payment of
principal or interest in respect of any Loan Tranche any amount
for or on account of Tax; or
(b) the Master Issuer is required to withhold or deduct from any
payment of principal, interest or premium in respect of its Notes
any amount for or on account of Tax; or
(c) a Loan Tranche becomes illegal as described in Clause 11
(Illegality);
then, without prejudice to the obligations of Funding 2 under Clause 11
(Illegality) and subject to Clause 12 (Mitigation), the Master Issuer
may require Funding 2 to prepay, on any Loan Payment Date, having given
not more than 60 days' and not less than 30 days' (or such shorter
period as may be required by any relevant law in the case of any Loan
Tranche which becomes illegal pursuant to Clause 11 (Illegality)) prior
written notice to Funding 2 and the Note Trustee (or on or before the
latest date permitted by the relevant law in the case of Clause 11
(Illegality)) so long as the relevant circumstances continue, the
applicable Loan Tranches without penalty or premium but subject to
Clause 16 (Default Interest and Indemnity), provided that the Repayment
Tests will be satisfied following such prepayment and the Master Issuer
is able to repay the related Notes used to fund such Loan Tranche on
such Loan Payment Date from funds received from repayment of such Loan
Tranche.
9.2 Prepayment at option of Master Issuer: The Master Issuer, at its option,
may require Funding 2 to prepay the outstanding principal amount of a
Loan Tranche (together with any accrued interest) on any Loan Payment
Date on which the Master Issuer has decided to exercise its option, if
any, to redeem in full the Notes used to fund such Loan Tranche provided
that the Repayment Tests will be satisfied following such prepayment.
The Master Issuer shall give Funding 2 not more than 60 days' and not
less than 30 days' prior written notice of the Master Issuer's decision
to exercise its option to require Funding 2 to prepay the relevant Loan
Tranche. Any prepayment by Funding 2 will be made without penalty or
premium but will be subject to Clause 16 (Default interest and
indemnity).
9.3 Application of monies: The Master Issuer hereby agrees to apply any
amounts received by way of prepayment pursuant to Clause 9.1 (Prepayment
for taxation or other reasons) or Clause 9.2 (Prepayment at option of
Master Issuer) in making prepayments under the relevant Notes.
10. Taxes
10.1 No gross up: All payments by Funding 2 under this Agreement shall be
made without any deduction or withholding for or on account of, and
free and clear of, any Taxes,
10
except to the extent that Funding 2 is required by law to make payment
subject to any Taxes.
10.2 Tax receipts: All Taxes required by law to be deducted or withheld by
Funding 2 from any amounts paid or payable under this Agreement shall be
paid by Funding 2 when due and Funding 2 shall, within 30 days of the
payment being made, deliver to the Master Issuer evidence satisfactory
to the Master Issuer (including all relevant Tax receipts) that the
payment has been duly remitted to the appropriate authority.
11. Illegality
If, at any time, it is unlawful for the Master Issuer to make, fund or
allow to remain outstanding a Loan Tranche made by it under this
Agreement, then the Master Issuer shall, promptly after becoming aware
of the same, deliver to Funding 2, the Funding 2 Security Trustee and
the Rating Agencies a certificate to that effect and if the Master
Issuer so requires, Funding 2 shall promptly to the extent necessary to
cure such illegality prepay such Loan Tranche subject to and in
accordance with the provisions of Clause 9.1 (Prepayment for taxation or
other reasons).
12. Mitigation
If circumstances arise in respect of the Master Issuer which would, or
would upon the giving of notice, result in:
(a) the prepayment of the Loan Tranches pursuant to Clause 11
(Illegality);
(b) a withholding or deduction from the amount to be paid by Funding 2
on account of Taxes pursuant to Clause 10 (Taxes),
then, without in any way limiting, reducing or otherwise qualifying the
obligations of Funding 2 under this Agreement, the Master Issuer shall:
(i) promptly upon becoming aware of the circumstances, notify
the Funding 2 Security Trustee, Funding 2 and the Rating
Agencies; and
(ii) upon written request from Funding 2, take such reasonable
steps as may be practical to mitigate the effects of those
circumstances including (without limitation) the assignment
by novation of the Master Issuer's rights under this Loan
Agreement to, and assumption by novation of all the Master
Issuer's obligations under this Agreement by, another
company, which is willing to participate in the Loan
Tranches in its place and which is not subject to (a) and/or
(b) above,
provided that no such transfer or assignment and transfer by novation of
such rights and obligations may be permitted unless the Rating Agencies
confirm in writing to Funding 2 and the Funding 2 Security Trustee that
there will be no downgrading of the then current rating of the Notes
issued by the Master Issuer as a result and Funding 2 indemnifies the
Master Issuer for any reasonable costs and expenses properly incurred as
a result of such transfer or assignment.
11
13. Representations and Warranties of Funding 2
13.1 Representations and warranties: Funding 2 makes the representations and
warranties set out in this Clause 13 to the Master Issuer and the
Funding 2 Security Trustee (as trustee for each of the Funding 2 Secured
Creditors).
13.2 Status:
(a) It is a limited liability 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
(b) it has the power to own its property and assets and to carry on
its business as it is being conducted.
13.3 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 a party.
13.4 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 of Funding 2.
13.5 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
including, without limitation, borrowing pursuant to the terms of this
Agreement or granting any security contemplated by the Transaction
Documents will not:
(a) result in the existence or imposition of, nor oblige it to create,
any Security Interest in favour of any person (other than the
Funding 2 Security Trustee for itself and on behalf of the other
Funding 2 Secured Creditors or as otherwise contemplated in the
Transaction Documents) over all or any of its present or future
revenues or assets;
(b) conflict with any document which is binding upon it or any of its
assets;
(c) conflict with its constitutional documents; or
(d) conflict with any law, regulation or official or judicial order of
any government, governmental body or court, domestic or foreign,
having jurisdiction over it.
13.6 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.
13.7 No default: No Funding 2 Intercompany Loan Event of Default is
continuing unremedied (if capable of remedy) or unwaived or would result
from the making of any Loan Tranche.
12
13.8 Authorisations: All governmental consents, licences and other approvals
and authorisations required or desirable 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.
13.9 Registration requirements: Except for due registration of the Funding 2
Deed of Charge under Section 395 of the Companies ▇▇▇ ▇▇▇▇, it is not
necessary that the Funding 2 Deed of Charge or this Agreement be filed,
recorded or enrolled with any authority or that, except for registration
fees payable at Companies Registry in respect of the Funding 2 Deed of
Charge, any stamp, registration or similar tax be paid on or in respect
thereof.
13.10 Ranking of security: The security conferred by the Funding 2 Deed of
Charge constitutes a first priority security interest of the type
described, and over the security assets referred to, in the Funding 2
Deed of Charge and the Funding 2 Charged Property is not subject to any
prior or pari passu Security Interests.
13.11 No other business:
(a) It has not traded or carried on any business since its date of
incorporation or engaged in any activity whatsoever that is not
incidental to or necessary in connection with any of the
activities in which the Transaction Documents provide or envisage
that it will engage; and
(b) it is not party to any material agreements other than the
Transaction Documents.
13.12 Ownership:
(a) Its entire issued share capital is legally and beneficially owned
and controlled by Holdings; and
(b) its shares are fully paid.
13.13 Good title as to assets: Subject to the Security Interests created under
the Funding 2 Deed of Charge, it is and will remain the absolute
beneficial owner of the Funding 2 Share and absolute legal and
beneficial owner of all other assets charged or assigned by the Funding
2 Deed of Charge to which it is a party.
13.14 Repetition: The representations in this Clause 13 (Representations and
Warranties of Funding 2) shall survive the execution of this Agreement
and the making of each Loan Tranche under this Agreement, and shall be
repeated by Funding 2 on each Closing Date relating to the making of
each Loan Tranche by reference to the facts and circumstances then
existing.
14. Covenants
14.1 Duration: The undertakings in this Clause 14 (Covenants) shall remain in
force from the date of this Agreement for so long as any amount is or
may be outstanding under this Agreement.
13
14.2 Information: Funding 2 shall supply to the Funding 2 Security
Trustee and the Rating Agencies:
(a) as soon as the same are available its audited accounts for that
Financial Year; and
(b) promptly, such other information in connection with the matters
contemplated by the Transaction Documents as the Funding 2
Security Trustee or the Rating Agencies may reasonably request.
14.3 Notification of Default: Funding 2 shall notify the Master Issuer and
the Funding 2 Security Trustee of any Funding 2 Intercompany Loan Event
of Default (and the steps, if any, being taken to remedy it) or any
event which with the giving of notice or lapse of time or certification
would constitute the same promptly upon Funding 2 becoming aware of the
occurrence of each Funding 2 Intercompany Loan Event of Default or such
other event.
14.4 Authorisations: Funding 2 shall promptly:
(a) obtain, maintain and comply with the terms of; and
(b) upon request, supply certified copies to the Master Issuer and the
Funding 2 Security Trustee of,
any authorisation required under any law or regulation to enable it to
perform its obligations under, or for the validity or enforceability of,
any Transaction Document to which it is a party.
14.5 Pari passu ranking: Funding 2 shall procure that its obligations under
the Transaction Documents do and will rank at least pari passu with all
its other present and future unsecured obligations, except for
obligations mandatorily preferred by law.
14.6 Negative pledge: Funding 2 shall not create or permit to subsist any
Security Interest over or in respect of any of its assets (unless
arising by operation of law) other than as provided pursuant to the
Transaction Documents.
14.7 Disposals; Mergers and Acquisitions: Funding 2 shall not, either in a
single transaction or in a series of transactions, whether related or
not and whether voluntarily or involuntarily, sell, assign, transfer,
lease or otherwise dispose of or grant any option over all or any part
of its assets, properties or undertakings or any interest, estate,
right, title or benefit therein, other than as provided for pursuant to
the Transaction Documents. In addition to the foregoing:
(a) Funding 2 shall not enter into any amalgamation, demerger, merger
or reconstruction; and
(b) Funding 2 shall not acquire any assets or business or make any
investments other than as contemplated in the Transaction
Documents.
14
14.8 Lending and borrowing:
(a) Except as provided or contemplated under the Transaction
Documents, Funding 2 shall not make any loans or provide any other
form of credit to any person.
(b) Funding 2 shall not give any guarantee or indemnity to or for the
benefit of any person in respect of any obligation of any other
person or enter into any document under which Funding 2 assumes
any liability of any other person.
(c) Funding 2 shall not incur any indebtedness in respect of any
borrowed money other than under the Transaction Documents.
14.9 Shares and dividends: Funding 2 shall not:
(a) declare or pay any dividend or make any other distribution in
respect of any of its shares other than in accordance with the
Funding 2 Deed of Charge;
(b) issue any further shares or alter any rights attaching to its
issued shares as at the date hereof; or
(c) repay or redeem any of its share capital.
14.10 Change of business:
(a) Funding 2 shall not carry on any business or engage in any
activity other than as contemplated by the Transaction Documents
or which is not incidental to or necessary in connection with any
of the activities in which the Transaction Documents provide or
envisage that Funding 2 will engage.
(b) Other than in respect of the Master Issuer (and any other Funding
2 Issuer), Funding 2 shall not have any subsidiaries or subsidiary
undertakings as defined in the Companies ▇▇▇ ▇▇▇▇, as amended.
(c) Funding 2 shall not own any premises.
14.11 Tax: Funding 2 shall not apply to become part of any group for the
purposes of section 43 of the Value Added Tax Act 1994 (as amended) with
the Master Issuer unless required to do so by law.
14.12 United States Activities: Funding 2 will not engage in any activities in
the United States (directly or through agents), will not derive any
income from United States sources as determined under United States
income tax principles and will not hold any property if doing so would
cause it to be engaged or deemed to be engaged in a trade or business
within the United States as determined under United States tax
principles.
14.13 Funding 2 Ledgers: Funding 2 shall maintain, or cause to be maintained,
the Funding 2 Ledgers in accordance with the Cash Management Agreement.
14.14 Funding 2 Liquidity Reserve Fund: Funding 2 will establish the Funding 2
Liquidity Reserve Fund and the Funding 2 Liquidity Reserve Ledger,
should the long-term, unsecured, unsubordinated and unguaranteed debt
obligations of the Seller cease to be
15
rated at least A3 by Moody's or A- by Fitch (unless Moody's or Fitch, as
applicable, confirms the then current ratings of the Notes of the Master
Issuer will not be adversely affected by such ratings downgrade). Any
such Funding 2 Liquidity Reserve Fund and Funding 2 Liquidity Reserve
Ledger shall be established and maintained in accordance with the
provisions of the Cash Management Agreement.
15. Default
15.1 Funding 2 Intercompany Loan Events of Default: Each of the events set
out in Clause 15.2 (Non-payment) to Clause 15.8 (Ownership) (both
inclusive) is a Funding 2 Intercompany Loan Event of Default (whether or
not caused by any reason whatsoever outside the control of Funding 2 or
any other person).
15.2 Non-payment: Subject to Clause 5.1 (Recourse limited to available
funds), Funding 2 does not pay on the due date or such failure to pay
continues for a period of five London Business Days after such due date
any amount payable by it under any Funding 2 Intercompany Loan Agreement
at the place at and in the currency in which it is expressed to be
payable.
15.3 Breach of other obligations: Funding 2 does not comply in any material
respect (in the opinion of the Funding 2 Security Trustee) with any of
its obligations under the Transaction Documents to which it is a party
(other than those referred to in Clause 15.2 (Non-payment)) and such
non-compliance, if capable of remedy, is not remedied promptly and in
any event within twenty London Business Days of Funding 2 becoming aware
of the non-compliance or receipt of a written notice from the Funding 2
Security Trustee requiring Funding 2's non-compliance to be remedied.
15.4 Misrepresentation: A representation, warranty or statement made or
repeated in or in connection with any Transaction Document or in any
document delivered by or on behalf of Funding 2 under or in connection
with any Transaction Document is incorrect in any material respect (in
the opinion of the Funding 2 Security Trustee) when made or deemed to be
made or repeated.
15.5 Insolvency:
(a) An order is made or an effective resolution is passed for the
winding up of Funding 2 (except, in any such case, a winding-up or
dissolution for the purpose of a reconstruction, amalgamation or
merger the terms of which have been previously approved by the
Funding 2 Security Trustee; or
(b) Except for the purposes of an amalgamation, merger or
restructuring as described in (a) above, Funding 2 ceases or
threatens to cease to carry on all or a substantial part of its
business or stops payment or threatens to stop payment of its
debts or is deemed unable to pay its debts within the meaning of
Section 123(a), (b), (c) or (d) of the Insolvency ▇▇▇ ▇▇▇▇ (as
amended, modified or re-enacted) or becomes unable to pay its
debts within the meaning of Section 132(2) of the Insolvency Act
1986 (as amended, modified or re-enacted); or
(c) Proceedings are otherwise initiated against Funding 2 under any
applicable liquidation, insolvency, composition, reorganisation or
other similar laws (including, but not limited to, presentation of
a petition for an administration
16
order or the making of an application for an administration order
or the filing of documents for an administration order) and
(except in the case of presentation of a petition for or making an
application for or filing of any documents for an administration
order) such Proceedings are not, in the opinion of the Funding 2
Security Trustee being disputed in good faith with a reasonable
prospect of success; or a formal notice is given of intention to
appoint an administrator; or an administration order is granted or
an administrative receiver or other receiver, liquidator or other
similar official is appointed in relation to Funding 2 or in
relation to the whole or any substantial part of the undertaking
or assets of Funding 2; or an encumbrancer taking possession of
the whole or any substantial part of the undertaking or assets of
Funding 2; or a distress, execution, diligence or other process is
levied or enforced upon or sued out against the whole or any
substantial part of the undertaking or assets of Funding 2 and
such possession or process (as the case may be) is not discharged
or not otherwise cease to apply within 30 days; or Funding 2
initiates or consents to judicial proceedings relating to itself
under applicable liquidation, insolvency, composition,
reorganisation or other similar laws or makes a conveyance or
assignment for the benefit of its creditors generally.
15.6 Unlawfulness: It is or becomes unlawful for Funding 2 to perform any
of its obligations under any Transaction Document.
15.7 The Funding 2 Deed of Charge: The Funding 2 Deed of Charge is no longer
binding on or enforceable against Funding 2 or effective to create the
security intended to be created by it.
15.8 Ownership: The entire issued share capital of Funding 2 ceases to be
legally and beneficially owned and controlled by Holdings.
15.9 Acceleration of Global Intercompany Loan: Upon the Funding 2 Security
Trustee's receipt from the Master Issuer or other party to a Transaction
Document of notice of the occurrence of a Funding 2 Intercompany Loan
Event of Default which is continuing unremedied and/or has not been
waived, the Funding 2 Security Trustee may by written notice to Funding
2 (a "Funding 2 Intercompany Loan Enforcement Notice") which is copied
to each of the Funding 2 Secured Creditors and the Mortgages Trustee:
(a) declare all Loan Tranches made under this Agreement to be
immediately due and payable, whereupon the same shall, subject to
Clause 15.10 (Repayment of Global Intercompany Loan on
acceleration), become so payable together with accrued interest
thereon and any other sums then owed by Funding 2 under this
Agreement; and/or
(b) declare the Loan Tranches to be due and payable on demand of the
Funding 2 Security Trustee.
15.10 Repayment of Global Intercompany Loan on acceleration: Upon the Funding
2 Security Trustee declaring the Loan Tranches to be immediately due and
payable pursuant to Clause 15.9 (Acceleration of Global Intercompany
Loan), the amount due and payable in respect of each Loan Tranche shall
be paid by Funding 2 without
17
penalty or premium but subject to Clause 16 (Default interest and
indemnity).
16. Default Interest and Indemnity
16.1 Default Loan Interest Periods: If any sum due and payable by Funding 2
under a Loan Tranche is not paid on the due date for payment in
accordance with this Agreement or if any sum due and payable by Funding
2 under any judgment or decree of any court in connection with this
Agreement is not paid on the date of such judgment or decree, the period
beginning on such due date or, as the case may be, the date of such
judgment or decree and ending on the date upon which the obligation of
Funding 2 to pay such sum (the balance thereof for the time being unpaid
being herein referred to as an "unpaid sum") is discharged shall be
divided into successive periods, each of which (other than the first)
shall start on the last day of the preceding such period and the
duration of each of which shall (except as otherwise provided in this
Clause 16) be selected by the Funding 2 Security Trustee having regard
to when such unpaid sum is likely to be paid.
16.2 Default interest: During each such period relating to an unpaid sum as
is mentioned in this Clause 16 an unpaid sum shall bear interest at the
rate per annum which the Master Issuer, acting reasonably, determines
and certifies to Funding 2 and the Funding 2 Security Trustee will be
sufficient to enable it to pay interest and other costs and indemnities
on or in respect of any amount which the Master Issuer does not pay as a
result of Funding 2's non-payment under this Agreement, as a result of
such unpaid sum not being paid to it.
16.3 Payment of default interest: Any interest which shall have accrued under
Clause 16.2 (Default interest) in respect of an unpaid sum shall be due
and payable and shall be paid by Funding 2 at the end of the period by
reference to which it is calculated or on such other date or dates as
the Funding 2 Security Trustee may specify by written notice to Funding
2.
16.4 Broken periods: Funding 2 shall forthwith on demand indemnify the Master
Issuer against any loss or liability that the Master Issuer incurs as a
consequence of any payment of principal being received from any source
otherwise than on a Loan Payment Date or an overdue amount being
received otherwise than on its due date.
16.5 Funding 2's payment indemnity: Funding 2 undertakes to indemnify the
Master Issuer:
(a) against any cost, claim, loss, expense (including legal fees) or
liability together with any amount in respect of Irrecoverable VAT
thereon (other than by reason of the negligence or wilful default
by the Master Issuer) which it may sustain or incur as a
consequence of the occurrence of any Funding 2 Intercompany Loan
Event of Default or any default by Funding 2 in the performance of
any of the obligations expressed to be assumed by it in any of the
Transaction Documents (other than by reason of negligence or
wilful default on the part of the Master Issuer or prior breach by
the Master Issuer of the terms of any of the Transaction Documents
to which it is a party); and
(b) against any other loss or liability (other than by reason of the
negligence or default of the Master Issuer or breach by the Master
Issuer of the terms of any
18
of the Transaction Documents to which it is a party (except where
such breach is caused by the prior breach of Funding 2) or loss of
profit) it may suffer by reason of having made a Loan Tranche
available or entering into this Agreement or enforcing any
security granted pursuant to the Funding 2 Deed of Charge.
17. Payments
17.1 Payment:
(a) Subject to Clause 5 (Limited Recourse), all amounts of interest
and principal to be paid to the Master Issuer under this Agreement
shall be paid in Sterling for value by Funding 2 to the Issuer
Transaction Account and the relevant irrevocable payment
instruction for such payment shall be given by Funding 2 by no
later than noon to the Issuer Cash Manager under the Issuer Cash
Management Agreement (with a copy to the Master Issuer and the
Funding 2 Security Trustee) on the Distribution Date immediately
preceding the relevant Loan Payment Date.
(b) On each date on which this Agreement requires any amount other
than the amounts specified in Clause 17.1(a) to be paid by Funding
2, Funding 2 shall, save as provided otherwise herein, make the
same available to the Master Issuer by payment in Sterling in
immediately available, freely transferable, cleared funds to the
Issuer Transaction Account.
17.2 Alternative payment arrangements: If, at any time, it shall become
impracticable (by reason of any action of any governmental authority or
any change in law, exchange control regulations or any similar event)
for Funding 2 to make any payments under this Agreement in the manner
specified in Clause 17.1 (Payment), then Funding 2 shall make such
alternative arrangements for the payment direct to the Master Issuer of
amounts due under this Agreement as are acceptable to the Funding 2
Security Trustee.
17.3 No set-off: All payments required to be made by Funding 2 under this
Agreement shall be calculated without reference to any set-off or
counterclaim and shall be made free and clear of, and without any
deduction for or on account of, any set-off or counterclaim.
18. Entrenched Provisions
Each of Funding 2, the Master Issuer and the Funding 2 Security Trustee
acknowledge and agree that Funding 2 may from time to time enter into
new Funding 2 Intercompany Loan Agreements and that the obligation of
Funding 2 to repay the Loan Tranches made under this Agreement will rank
pari passu with the obligations of Funding 2 to repay any such other
loans made under such Funding 2 Intercompany Loan Agreements. If Funding
2 intends to enter into a new Funding 2 Intercompany Loan Agreement then
the provisions of this Agreement may be varied (with the consent of the
parties to this Agreement to the extent necessary to reflect the terms
of that Funding 2 Intercompany Loan Agreement) PROVIDED THAT no
variation shall be made to any of the following terms without the prior
written consent of the Funding 2 Secured Creditors and the Rating
Agencies:
19
(a) the Loan Payment Dates;
(b) Clause 5 (Limited Recourse);
(c) Clause 10 (Taxes); and
(d) Clause 19.5 (Funding 2 Security Trustee).
19. Further Provisions
19.1 Evidence of indebtedness: In any proceeding, action or claim relating to
a Loan Tranche a statement as to any amount due to the Master Issuer
under such Loan Tranche which is certified as being correct by an
officer of the Funding 2 Security Trustee shall, unless otherwise
provided in this Agreement, be prima facie evidence that such amount is
in fact due and payable.
19.2 Entire Agreement, Amendments and Waiver and Rights cumulative:
(a) Entire Agreement: This Agreement sets out the entire agreement and
understanding between the parties with respect to the subject
matter of this Agreement superseding all prior oral or written
understandings other than the other Transaction Documents.
(b) Amendments and Waiver: Subject to Clause 18 (Entrenched
Provisions), 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.
(c) 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.
19.3 Assignment: Neither the Master Issuer nor Funding 2 may assign or
transfer any of its respective rights and obligations under this
Agreement PROVIDED THAT:
(a) the Master Issuer may assign its rights, title, interest or
benefit hereunder to the Issuer Security Trustee pursuant to the
Issuer Deed of Charge;
(b) Funding 2 may assign its rights hereunder to the Funding 2
Security Trustee pursuant to the Funding 2 Deed of Charge.
19.4 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
20
thereby.
19.5 Funding 2 Security Trustee:
(a) The Funding 2 Security Trustee shall have no responsibility for
any of the obligations of any other party to this Agreement (other
than itself). For the avoidance of doubt, the parties to this
Agreement acknowledge that the rights and obligations of the
Funding 2 Security Trustee under this Agreement are governed by
the Funding 2 Deed of Charge.
(b) As between the Funding 2 Security Trustee and the parties hereto
any liberty or power which may be exercised or any determination
which may be made hereunder by the Funding 2 Security Trustee may
be exercised or made in the Funding 2 Security Trustee's absolute
discretion without any obligation to give reasons therefor, but in
any event must be exercised or made in accordance with the
provisions of the Funding 2 Deed of Charge.
19.6 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.
19.7 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) ▇▇▇ ▇▇▇▇, but this shall not affect any right or remedy of a
third party which exists or is available apart from that Act.
19.8 Corporate Obligations: To the extent permitted by law, no recourse under
any obligation, covenant, or agreement of any person contained in this
Agreement shall be had against any shareholder, officer or director of
such person as such, by the enforcement of any assessment or by any
legal proceeding, by virtue of any statute or otherwise; it being
expressly agreed and understood that this Agreement is a corporate
obligation of each person expressed to be a party hereto and no personal
liability shall attach to or be incurred by the shareholders, officers,
agents or directors of such person as such, or any of them, under or by
reason of any of the obligations, covenants or agreements of such person
contained in this Agreement, or implied therefrom, and that any and all
personal liability for breaches by such person of any of such
obligations, covenants or agreements, either under any applicable law or
by statute or constitution, of every such shareholder, officer, agent or
director is hereby expressly waived by each person expressed to be a
party hereto as a condition of and consideration for the execution of
this Agreement.
20. Redenomination
Each obligation under this Agreement which has been denominated in
Sterling shall be redenominated in Euro in accordance with applicable
legislation passed by the European Monetary Union upon such
redenomination of the Sterling Notes.
21
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 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 Master Issuer, to Granite Issuer Master plc,
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ (facsimile number
020 7606 0643) for the attention of the Company Secretary with a
copy to Northern Rock plc, Northern ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ (facsimile number 0191 213 2203) for
the attention of the Group Secretary;
(b) in the case of Funding 2, to Granite Finance Funding 2 Limited,
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ (facsimile number
020 8409 8911) for the attention of the Company Secretary (with a
copy to Northern Rock plc, Northern ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ (facsimile number 0191 213 2203) for
the attention of the Group Secretary);
(c) in the case of Funding 2 Security Trustee, to The Bank of New
York, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇ (facsimile
number 020 7964 6399) for the attention of the Global Structured
Finance (Corporate Trust); and
(d) in the case of Agent Bank, to Citibank, N.A., ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, (facsimile number 020 7508 3881) for the
attention of Rate Fixing,
or to such other address or facsimile number or for the attention
of such other person or entity as may from time to time be
notified by any party to the others by written notice in
accordance with the provisions of this Clause 22. All notices
served under this Agreement shall be simultaneously copied to the
Funding 2 Security Trustee by the person serving the same.
22. Governing Law and Submission to Jurisdiction
22.1 Governing Law: This Agreement is governed by, and shall be
construed in accordance with, English law.
22.2 Submission to Jurisdiction: Each of the parties hereto irrevocably
agrees that the courts of England shall have jurisdiction to hear and
determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and, for
such purposes, irrevocably submits to the jurisdiction of such courts.
22.3 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 suit, action or proceeding and to
settle any disputes, and agrees not
22
to claim that any such court is not a convenient or appropriate
forum.
IN WITNESS WHEREOF the parties have caused this Agreement to be duly executed
on the day and year first before written.
23
SCHEDULE 1
FORM OF LOAN TRANCHE NOTICE
From: Granite Master Issuer plc (the "Master Issuer")
To: Granite Finance Funding 2 Limited ("Funding 2")
Copy: The Bank of New York (the "Funding 2 Security Trustee")
Dear Sirs,
1. We refer to the agreement between, inter alios, ourselves, Funding 2 and
the Funding 2 Security Trustee (as from time to time amended, varied,
novated or supplemented (the "Global Intercompany Loan Agreement"))
dated 19 January, 2005 whereby a Global Loan Facility was made available
to Funding 2. Terms defined in the Global Intercompany Loan Agreement
shall have the same meaning in this notice.
2. We hereby give you notice that, pursuant to the Global Intercompany Loan
Agreement and upon the terms and subject to the conditions contained
therein, we wish to make the following Loan Tranches available to
Funding 2 on [specify Closing Date]:
o Series [o] [o] (Class [o]) Loan Tranche to be funded by the Series
[o] Class [o] Notes on the Closing Date:
(a) principal amount and currency of [o];
(b) specified Currency Exchange Rate of GBP 1.00/[o];
(c) Principal amount (in Sterling) available to be drawn in
respect of such Loan Tranche of (pound)[o];
[repeat for all applicable Loan Tranches]
3. The interest rate(s) applicable to each Loan Tranche will be as follows:
o Series [o] [o] (Class [o]) Loan Tranche: [o] [Set out relevant
interest rate(s)]
[repeat for all applicable Loan Tranches]
Yours faithfully,
For and on behalf of
Granite Master Issuer plc
24
Exhibit 4.1.2
SCHEDULE 2
FORM OF LOAN TRANCHE SUPPLEMENT
25
Dated [o]
GRANITE FINANCE FUNDING 2 LIMITED
as Funding 2
GRANITE MASTER ISSUER PLC
as Master Issuer
THE BANK OF NEW YORK
as Funding 2 Security Trustee
CITIBANK, N.A.
as Agent Bank
----------------------------------------------------------------
LOAN TRANCHE SUPPLEMENT
----------------------------------------------------------------
26
THIS LOAN TRANCHE SUPPLEMENT is dated [o] between:
(1) GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249387) a private
limited liability company incorporated under the laws of England and
Wales whose registered office is at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ as Funding 2;
(2) GRANITE MASTER ISSUER PLC (registered number 5250668) a public limited
company incorporated under the laws of England and Wales whose
registered office is at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ as
Master Issuer;
(3) THE BANK OF NEW YORK, acting through its office at ▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ in its capacity as the Funding 2 Security
Trustee; and
(4) CITIBANK, N.A., acting through its office at ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ in its capacity as the Agent Bank.
This document constitutes the Loan Tranche Supplement relating to the Loan
Tranches described herein. Terms used herein shall be deemed to be defined as
such for the purposes of the Global Intercompany Loan Agreement entered into
between the parties hereto on 19 January, 2005. This Loan Tranche Supplement
contains the final terms of the Loan Tranches identified and described herein,
is supplemental to and must be read in conjunction with the Global
Intercompany Loan Agreement.
[To be repeated for each Loan Tranche funded by Notes of each class of the
same Series]
Loan Tranche: The Series [o] Class [o] Notes will fund the [identifier] Loan
Tranche which shall have the following terms:
1. Borrower: Granite Finance Funding 2 Limited
2. Lender: Granite Master Issuer plc
3. (i) Loan Tranche Rating: [o]
(ii) Series Number: [o]
4. Initial Outstanding Principal [o]
Balance:
5. (i) Closing Date: [o]
(ii) Loan Tranche Interest [o]
Commencement Date:
(iii) Loan Tranche Interest Reset Dates: The Monthly Payment Date falling in [o], [o], [o]
and [o] of each year or, following the earlier to
occur of the Step-Up Date in relation to this Loan
Tranche or a Pass-Through Trigger Event, each
Monthly Payment Date of each year.
27
6. Final Repayment Date: [o]
7. Loan Payment Dates: Each Monthly Payment Date in each year up to and
including the Final Repayment Date
8. Initial Relevant Screen Rate: [o]
9. Loan Reference Rate: [o] or, following the earlier to occur of the
Step-Up Date in relation to this Loan Tranche or a
Pass-Through Trigger Event, LIBOR for one-month
sterling deposits
10. Relevant Margin: [o]
11. Step-Up Date: [Not Applicable/The Loan Payment Date occurring in
[specify date]] (If not applicable, delete the
remaining parts of this sub-paragraph)
12. Relevant Margin following Step-Up [Not Applicable/[o]]
Date:
13. Redemption/Payment Basis: [Redemption at par]
[Index Linked Redemption]
[Bullet Redemption]
[Scheduled Redemption]
[Controlled Amortisation]
[Pass-through]
14. Change of Redemption/Payment [Specify details of any provision for change of
Basis: Loan Tranches into another Redemption/Payment
Basis
15. Details relating to Bullet Loan [Applicable/Not Applicable]
Tranche:
[if not applicable, delete the remaining
sub-paragraphs of this paragraph]
(i) Bullet Repayment Loan [o]
Amount:
(ii) Bullet Redemption Date: [o]
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16. Details relating to Scheduled [Applicable/Not Applicable]
Repayment Loan Tranche:
[If the Scheduled Repayment Loan Tranche is
applicable, specify the Scheduled Repayment Dates
and Scheduled Repayment Loan Instalments below]
[if not applicable, delete the remaining
sub-paragraphs of this paragraph]
Scheduled Repayment Dates Scheduled Repayment Loan Instalment:
Loan Repayment Dates occurring
in:
[o] [o]
17. Details relating to Controlled Repayment [Applicable/Not Applicable]
Loan Tranche:
[If the Controlled Repayment Loan Tranche is
applicable, specify the Target Balance for each
Loan Payment Date below] [if not applicable,
delete the remaining sub-paragraphs of this
paragraph]
Controlled Repayment Dates Target Balance:
Loan Payment Date occurring in:
[o] [o]
18. Details relating to Pass-through [Applicable/Not Applicable]
Loan Tranches:
[If the Pass-through Loan Tranche is applicable,
specify the Loan Payment Date following which the
Pass-Through Loan Tranches will be due]
[If not applicable, delete the remaining
sub-paragraphs of this paragraph].
19. Other terms and special conditions: [Not Applicable/give details]
29
Confirmations:
Funding 2 confirms that:
(a) no Funding 2 Intercompany Loan Event of Default has occurred and is
continuing which has not been waived, or would result from the making of
such Loan Tranche;
(b) the representations and warranties set out in Clause 13 (Representations
and Warranties of Funding 2) are true on and as of the Closing Date
specified in this Loan Tranche Supplement by reference to the facts and
circumstances then existing; and
(c) as of the Closing Date specified in this Loan Tranche Supplement, there
is no debit balance on the Funding 2 Principal Deficiency Ledger.
The Master Issuer confirms that:
(a) no Issuer Event of Default has occurred and is continuing which has not
been waived, or would result from the making of such Loan Tranche;
(b) the aggregate amount of the Loan Tranches to be made on the Closing Date
specified in this Loan Tranche Supplement and any Loan Tranches
outstanding on such Closing Date do not exceed the Total Credit
Commitment.
30
EXECUTION PAGE
for Loan Tranche Supplement
as Funding 2
EXECUTED for and on behalf of )
GRANITE FINANCE FUNDING 2 LIMITED )
by )
-------------------------
Name:
as Master Issuer
EXECUTED for and on behalf of )
GRANITE MASTER ISSUER PLC )
by )
-------------------------
Name:
as Funding 2 Security Trustee
EXECUTED for and on behalf of )
THE BANK OF NEW YORK )
by )
-------------------------
Name:
as Agent Bank
EXECUTED for and on behalf of )
CITIBANK, N.A. )
by )
-------------------------
Name:
31
EXECUTION PAGE
as Funding 2
EXECUTED for and on behalf of )
GRANITE FINANCE FUNDING 2 LIMITED )
by )
-------------------------
Name:
as Master Issuer
EXECUTED for and on behalf of )
GRANITE MASTER ISSUER PLC )
by )
-------------------------
Name:
as Funding 2 Security Trustee
EXECUTED for and on behalf of )
THE BANK OF NEW YORK )
by )
-------------------------
Name:
as Agent Bank
EXECUTED for and on behalf of )
CITIBANK, N.A. )
by )
-------------------------
Name:
32