EIGHTH AMENDED CASH MANAGEMENT AGREEMENTCash Management Agreement |
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Search Cash Management Agreement by:
Exhibit 4.8
Dated 26
March 2001
NORTHERN
ROCK PLC
as Cash Manager,
Seller and Beneficiary
GRANITE FINANCE TRUSTEES LIMITED
as Mortgages
Trustee
GRANITE FINANCE
FUNDING LIMITED
as
Beneficiary
GRANITE FINANCE
FUNDING 2 LIMITED
as
Beneficiary
- and
-
THE BANK OF
NEW YORK
as Security Trustee and
Funding 2 Security Trustee
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EIGHTH AMENDED CASH
MANAGEMENT AGREEMENT
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SIDLEY AUSTIN
BROWN & WOOD
WOOLGATE EXCHANGE
25
BASINGHALL STREET
LONDON
EC2V 5HA
TELEPHONE 020
7360 3600
FACSIMILE 020
7626 7937
REF:30507-30090/972619
<PAGE>
CONTENTS
1. Definitions and
Interpretation.........................................4
2. Appointment of Cash
Manager............................................5
3. The Services...........................................................6
4. Payments, Accounts,
Ledgers............................................7
5. Early Repayment
Charges...............................................22
6. No Liability..........................................................23
7. Costs and
Expenses....................................................23
8.
Information...........................................................23
9.
Remuneration..........................................................27
10. Covenants, Representations and
Warranties of the Cash Manager.........27
11. Services
Non-Exclusive................................................28
12.
Termination...........................................................28
13. Further
Assurances....................................................32
14.
Miscellaneous.........................................................32
15.
Confidentiality.......................................................33
16. No Partnership........................................................34
17.
Assignment............................................................34
18. The Funding Security
Trustees.........................................34
19. New Intercompany Loan Agreements......................................35
20. Non Petition Covenant; Limited
Recourse...............................35
21. Amendments and
Waiver.................................................37
22.
Notices...............................................................38
23. Third Party
Rights....................................................39
24. Execution in Counterparts;
Severability...............................39
1
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25. Governing Law and Submission to
Jurisdiction..........................39
SCHEDULE 1 The Cash Management Services....................................41
SCHEDULE 2 Cash Management and Maintenance of Ledgers......................46
SCHEDULE 3A Form of Mortgages Trustee Quarterly Report.....................67
SCHEDULE 3B Form of Funding Quarterly Report...............................68
SCHEDULE 3C Form of Funding 2 Quarterly Report.............................71
SCHEDULE 4 Cash Manager Representations and Warranties.....................74
2
<PAGE>
THIS AGREEMENT IS MADE ON 26 MARCH, 2001 AND AMENDED AND RESTATED PURSUANT TO
THE DEEDS OF AMENDMENT AND RESTATEMENT DATED 23 JULY 2001, 27 JANUARY 2003, 24
SEPTEMBER 2003, 28 JANUARY 2004, 26 MAY 2004, 19 JANUARY 2005, 24 AUGUST 2005,
19 JANUARY 2005 AND 23 DECEMBER 2005 BETWEEN:
(1) NORTHERN ROCK PLC (registered number
3273685), a public limited company
incorporated under the laws of
England and Wales whose registered office
is at Northern Rock House, Gosforth,
Newcastle upon Tyne NE3 4PL in its
capacity as Cash Manager, Seller and
as a Beneficiary;
(2) GRANITE FINANCE TRUSTEES LIMITED
(registered number 79309), a private
limited company incorporated under
the laws of Jersey, Channel Islands
whose registered office is at 22
Grenville Street, St. Helier, Jersey JE4
8PX, Channel Islands in its capacity
as Mortgages Trustee;
(3) GRANITE FINANCE FUNDING LIMITED
(registered number 79308), a private
limited company incorporated under the laws of
Jersey, Channel Islands
having its principal place of
business in the United Kingdom at 69 Park
Lane, Croydon CR9 1TQ in its
capacity as Funding and a Beneficiary;
(4) GRANITE FINANCE FUNDING 2 LIMITED
(registered number 5249387), a private
limited company incorporated under
the laws of England and Wales whose
registered office is at Fifth Floor,
100 Wood Street, London EC2V 7EX in
its capacity as Funding 2 and a
Beneficiary; and
(5) THE BANK OF NEW YORK a New York
banking corporation acting through its
office at 48th Floor, One Canada
Square, London E14 5AL in its capacity
as Security Trustee and Funding 2
Security Trustee.
WHEREAS:
(A) On the Initial Closing Date the First
Issuer will issue the First Issuer
Notes constituted by the First
Issuer Trust Deed. From the proceeds of
the issue of those First Issuer
Notes, the First Issuer shall make a loan
to Funding pursuant to the terms of
the First Issuer Intercompany Loan
Agreement. From the proceeds of that
loan, Funding shall pay the Initial
Contribution to the Mortgages
Trustee as consideration in part for the
Initial Funding Share of the Trust
Property, which funds will be used by
the Mortgages Trustee to pay to the
Seller the Initial Purchase Price for
the sale and assignment by the
Seller to the Mortgages Trustee of the
Initial Mortgage Portfolio pursuant
to the Mortgage Sale Agreement.
(B) On the Funding 2 Programme Date,
Funding 2 acquired a portion of the
Seller's beneficial interest in the
Mortgages Trust Deed and became party
to the Mortgages Trust Deed.
(C) The Cash Manager is willing to
provide Cash Management Services to the
Mortgages Trustee each Funding
Beneficiary and each Funding Security
Trustee on the terms and subject to
the conditions contained in this
Agreement.
3
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IT IS HEREBY AGREED as follows:
1. Definitions and Interpretation
1.1 The provisions of the Programme
Master Definitions Schedule signed for
the purposes of identification by
Sidley Austin Brown & Wood and Allen &
Overy 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.
1.2 Any reference in this Agreement to
any discretion, power or right on the
part of the Mortgages Trustee shall
be as exercised by the Mortgages
Trustee only as directed by the
Beneficiaries but subject in each case to
the provisions of the Mortgages
Trust Deed and the Controlling
Beneficiary Deed.
1.3 In addition to the provisions of the
Programme Master Definitions
Schedule, the following words and
expressions used in this Agreement
shall the meanings set out below.
"Funding Basis Rate Swap
Agreement" means each of the ISDA Master
Agreements, Schedules and Confirmations
thereto each entered into on or
about 23 December 2005 and any
Credit Support Annexes or other credit
support documents entered into at
any time among Funding and the Funding
Basis Rate Swap Provider and/or any
credit support provider and shall
include any additional basis rate
swap agreement entered into by Funding
from time to time in accordance with
the Transaction Documents;
"Funding Basis Rate Swap
Provider" means Northern Rock and/or, as
applicable, any other basis rate
swap provider appointed from time to
time by Funding in accordance with
the Transaction Documents;
"Funding Basis Rate Swaps"
means the swap transactions as documented
under the Funding Basis Rate Swap
Agreements;
"Funding Swap Collateral"
means any asset (including, without limitation,
Cash and/or securities) delivered to
Funding by the Funding Basis Rate
Swap Provider in accordance with the
terms of any of, the Funding Basis
Rate Swap Agreements in respect of
the Funding Basis Rate Swap Provider's
obligations under such Funding Basis
Rate Swap Agreement;
"Funding Swap Collateral
Accounts" means the Funding Swap Collateral Cash
Account and the Funding Swap
Collateral Securities Account;
"Funding Swap Collateral Cash
Account" means an account opened in the
name of Funding for the purpose of
holding Funding Swap Collateral in
Cash and maintained in accordance
with the terms of the Cash Management
Agreement;
"Funding Swap Collateral
Ledger" means the ledger maintained by the Cash
Manager in the books of Funding in
accordance with Clause 4.3 (Funding
Ledgers) of the Cash Management
Agreement;
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"Funding Swap Collateral
Securities Account" means a securities account
opened in the name of the Funding
for the purpose of holding Funding Swap
Collateral in the form of securities
and maintained in accordance with
the terms of the Cash Management Agreement;
and
"Funding Swap Replacement
Premium" means any payment received from a
replacement swap provider upon entry
into an agreement with such
replacement swap provider replacing
a Funding Basis Rate Swap Agreement.
2. Appointment of Cash Manager
2.1 Appointment: Until termination
pursuant to Clause 12 (Termination)
herein, the Mortgages Trustee,
Funding and the Security Trustee
(according to their respective
estates and interests) each hereby
appoints the Cash Manager as its
lawful agent to provide the Cash
Management Services set out in this
Agreement and the Cash Manager in
each case hereby accepts such
appointment on the terms and subject to the
conditions of this Agreement.
2.2 Appointment by Funding 2: Until
termination pursuant to Clause 12
(Termination) herein, Funding 2
(according to its estates and interests)
hereby appoints the Cash Manager as
its lawful agent to provide the Cash
Management Services set out in this
Agreement and the Cash Manager hereby
accepts such appointment on the
terms and subject to the conditions of
this Agreement. The Funding 2
Security Trustee consents to the
appointment of the Cash Manager on
the terms of and subject to the
conditions of this Agreement.
2.3 Duties prescribed by Transaction
Documents: For the avoidance of doubt
and in connection with the powers
conferred under Clause 2.1
(Appointment) and Clause 2.2
(Appointment by Funding 2), save as
expressly provided elsewhere in this
Agreement, nothing herein shall be
construed so as to give the Cash
Manager any powers, rights, authorities,
directions or obligations other than
as specified in this Agreement or
any of the other Transaction
Documents.
2.4 Appointment conditional upon
issuance of First Issuer Notes: The
appointment pursuant to Clause 2.1
(Appointment) is conditional upon the
issue of the First Issuer Notes and
the making of the First Issuer
Intercompany Loan under the First
Issuer Intercompany Loan Agreement and
shall take effect upon and from the
Initial Closing Date automatically
without any further action on the
part of any person, PROVIDED THAT, if
the issue of the First Issuer Notes
by the First Issuer has not occurred
by 30 April 2001, or such later date
as the First Issuer and the Lead
Manager may agree, this Agreement
shall cease to be of further effect.
2.5 Appointment by Funding 2
Conditional: The appointment pursuant to Clause
2.2 (Appointment by Funding 2)
herein is conditional upon the acquisition
by Funding 2 from the Seller of a
portion of the Seller's beneficial
interest in the Mortgages Trust
pursuant to the Seller (Mortgages Trust)
Assignment Agreement and shall take
effect upon and from the Funding 2
Programme Date automatically without
any further action on the part of
any person PROVIDED THAT if Funding
2 has not acquired from the Seller a
portion of the Seller's beneficial
interest in the Mortgages Trust by 31
January, 2005, or such later date as
Funding 2 and the Seller may agree,
the
5
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appointment of the Cash Manager as
agent of Funding 2 under Clause 2.2
(Appointment by Funding 2) shall not
take effect.
3. The Services
3.1 General: The Cash Manager shall
provide the services set out in this
Agreement (including, without
limitation, Schedules 1 and 2 attached
hereto) (the "Cash Management
Services").
3.2 Approvals and authorisations: The
Cash Manager shall maintain, or procure
the maintenance of, the approvals,
authorisations, consents and licences
required in connection with the
respective businesses of the Mortgages
Trustee and each Funding Beneficiary
and shall prepare and submit, or
procure the preparation and
submission of, on behalf of the Mortgages
Trustee and each Funding
Beneficiary, all necessary applications and
requests for any further approvals,
authorisations, consents or licences
which may be required in connection
with the respective businesses of the
Mortgages Trustee and each Funding
Beneficiary and shall, so far as it
reasonably can do so, perform the
Cash Management Services in such a way
as not to prejudice the continuation
of any such approvals,
authorisations, consents or
licences.
3.3 Compliance with Transaction
Documents, etc.: The Cash Management Services
shall include procuring (so far as
the Cash Manager, using its reasonable
endeavours, is able so to do)
compliance by the Mortgages Trustee and
each Funding Beneficiary with all
applicable legal requirements and with
the terms of the Transaction
Documents to which each of the Mortgages
Trustee and/or and each Funding
Beneficiary (respectively) is a party,
PROVIDED THAT the Cash Manager shall
not lend or provide any sum to the
Mortgages Trustee or any Funding
Beneficiary (other than as expressly
contemplated by the Transaction
Documents) and the Cash Manager shall
have no liability whatsoever to the
Mortgages Trustee, each Funding
Beneficiary and each Funding
Security Trustee, to any other person for
any failure by the Mortgages Trustee
or any Funding Beneficiary to make
any payment due by any of them under
any of the Transaction Documents
(other than to the extent arising
from (i) the Cash Manager failing to
make a payment in its capacity as
Administrator, or in any other capacity
under the Transaction Documents, or
(ii) the Cash Manager failing to
perform any of its obligations under
any of the Transaction Documents).
3.4 Liability of Cash Manager:
(a)
The Cash Manager shall indemnify each of the Mortgages Trustee, each
Funding Beneficiary and each
Funding Security Trustee on demand for
any loss, liability, claim,
expense or damage suffered or incurred
by any of them in respect of
the negligence, bad faith or wilful
default of the Cash Manager in
carrying out its functions as Cash
Manager under this Agreement or
under the other Transaction
Documents or as a result of a
breach by the Cash Manager of the
terms and provisions of this
Agreement or such other Transaction
Documents to which the Cash
Manager is a party (in its capacity as
such) in relation to such
functions.
(b)
For the avoidance of doubt, the Cash Manager shall not be liable in
respect of any loss, liability,
claim, expense or damage suffered or
incurred by the
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Mortgages Trustee, each Funding
Beneficiary or each Funding Security
Trustee and/or any other person
as a result of the proper
performance of the Cash
Management Services (as defined in Clause
3.1 (General)) by the Cash
Manager save to the extent that such
loss, liability, claim, expense
or damage is suffered or incurred as
a result of any negligence, bad
faith or wilful default of the Cash
Manager under, or as a result
of, a breach by the Cash Manager of
the terms and provisions of
this Agreement or any of the other
Transaction Documents to which
the Cash Manager is a party (in its
capacity as such) in relation
to such functions.
4. Payments, Accounts, Ledgers
4.1 Establishment of Bank Accounts:
(a)
The Cash Manager hereby confirms that the Mortgages Trustee GIC
Account has been established on
or before the date hereof pursuant
to the Bank Account Agreement
and the Mortgages Trustee Guaranteed
Investment Contract and that
the Mortgages Trustee GIC Account
Mandate in the agreed form will
apply thereto at the Initial Closing
Date. The Cash Manager
undertakes (to the extent to which the same
is within its control) that at
the Initial Closing Date the
Mortgages Trustee GIC Account
will be operative and that the Cash
Manager will not knowingly
create or permit to subsist any Security
Interest in relation to the
Mortgages Trustee GIC Account (but
without prejudice to the
Mortgages Trust and the other Transaction
Documents).
(b)
The Cash Manager hereby confirms that the Mortgages Trustee
Transaction Account has been
established on or before the date
hereof pursuant to the Bank
Account Agreement and that the Mortgages
Trustee Transaction Account
Mandate in the agreed form will apply
thereto at the Initial Closing
Date. The Cash Manager undertakes (to
the extent to which the same is
within its control) that at the
Initial Closing Date the
Mortgages Trustee Transaction Account will
be operative and that the Cash
Manager will not knowingly create or
permit to subsist any Security
Interest in relation to the Mortgages
Trustee Transaction Account
(but without prejudice to the Mortgages
Trust and the other Transaction
Documents).
(c)
The Cash Manager hereby confirms that the Funding GIC Account has
been established on or before
the date hereof pursuant to the Bank
Account Agreement and the
Funding Guaranteed Investment Contract and
that the Funding GIC Account Mandate in the
agreed form will apply
thereto at the Initial Closing
Date. The Cash Manager undertakes (to
the extent to which the same is
within its control) that at the
Initial Closing Date the Funding
GIC Account will be operative and
that the Cash Manager will not
knowingly create or permit to subsist
any Security Interest in
relation to the Funding GIC Account other
than as created under or
permitted pursuant to the Funding Deed of
Charge.
(d)
The Cash Manager hereby confirms that the Funding Transaction
Account has been established on
or before the date hereof pursuant
to the Bank Account
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Agreement and that the Funding
Transaction Account Mandate in the
agreed form will apply thereto
at the Initial Closing Date. The Cash
Manager undertakes (to the
extent to which the same is within its
control) that at the Initial
Closing Date the Funding Transaction
Account will be operative and
that the Cash Manager will not
knowingly create or permit to
subsist any Security Interest in
relation to the Funding
Transaction Account other than as created
under or permitted pursuant to
the Funding Deed of Charge.
(e)
The Cash Manager hereby confirms that the Funding (First Issuer) GIC
Account has been established on
or before the date hereof pursuant
to the Funding (First Issuer) Bank
Account Agreement and the Funding
(First Issuer) Guaranteed
Investment Contract and that the Funding
(First Issuer) GIC Account
Mandate in the agreed form will apply
thereto at the Initial Closing
Date. The Cash Manager undertakes (to
the extent to which the same is
within its control) that at the
Initial Closing Date the
Funding (First Issuer) GIC Account will be
operative and that the Cash
Manager will not knowingly create or
permit to subsist any Security
Interest in relation to the Funding
(First Issuer) GIC Account
other than as created under or permitted
pursuant to the Funding Deed of
Charge.
(f)
The Cash Manager hereby confirms that the Funding 2 GIC Account has
been established on or before
the Funding 2 Programme Date pursuant
to the Funding 2 Bank Account
Agreement and the Funding 2 Guaranteed
Investment Contract and that
the Funding 2 GIC Account Mandate in
the agreed form will apply
thereto at the Funding 2 Programme Date.
The Cash Manager undertakes (to
the extent to which the same is
within its control) that at the
Funding 2 Programme Date the Funding
2 GIC Account will be operative
and that the Cash Manager will not
knowingly create or permit to
subsist any Security Interest in
relation to the Funding 2 GIC
Account other than as created under or
permitted pursuant to the
Funding 2 Deed of Charge.
(g)
The Cash Manager hereby confirms that the Funding 2 Transaction
Account has been established on
or before the Funding 2 Programme
Date pursuant to the Funding 2
Bank Account Agreement and that the
Funding 2 Transaction Account
Mandate in the agreed form will apply
thereto at the Funding 2
Programme Date. The Cash Manager undertakes
(to the extent to which the
same is within its control) that at the
Funding 2 Programme Date the
Funding 2 Transaction Account will be
operative and that the Cash
Manager will not knowingly create or
permit to subsist any Security
Interest in relation to the Funding 2
Transaction Account other than
as created under or permitted
pursuant to the Funding 2 Deed
of Charge.
(h)
On each occasion that Funding enters into an Intercompany Loan
Agreement, the Cash Manager
undertakes to establish a separate
Funding (Issuer) GIC Account in
respect of the applicable Funding
Issuer to which amounts in
respect of any Issuer Reserve Fund and
Issuer Liquidity Reserve Fund
(if any) of such Issuer will be
credited.
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(i)
On each occasion that a Funding Beneficiary enters into an
Intercompany Loan Agreement
(or, in the case of Funding 2, is the
recipient of a Loan Tranche
under an existing Funding 2 Intercompany
Loan Agreement), then the Cash
Manager, the Seller, each Funding
Beneficiary, each Funding
Security Trustee and the Mortgages Trustee
shall execute such amendments
to this Agreement as may be necessary
to reflect the establishment of
any bank account for such Funding
Beneficiary.
4.2 Mortgages Trustee Ledgers:
(a)
The Cash Manager shall open and maintain in the books of the
Mortgages Trustee the following
ledgers on behalf of the Mortgages
Trustee:
(i) the Principal Ledger, which shall separately
reflect all
Principal Receipts
standing to the credit of each of the
Mortgages Trustee GIC
Account and the Mortgages Trustee
Transaction Account from
time to time and distribution of the
same to the Beneficiaries;
(ii) the Revenue Ledger, which
shall separately reflect all Revenue
Receipts standing to the
credit of each of the Mortgages
Trustee GIC Account and
the Mortgages Trustee Transaction
Account from time to time
and distribution of the same to the
Beneficiaries;
(iii) the Losses Ledger, which
shall record Losses on the Mortgage
Portfolio;
(iv) the Funding Share/Funding
2 Share/Seller Share Ledger which
shall record the Funding
Share, the Funding 2 Share, the Seller
Share, the Funding Share
Percentage, the Funding 2 Share
Percentage and the Seller
Share Percentage of the Trust
Property;
(v) the Overpayments Ledger, which will reflect
each Revenue
Receipt and/or Principal
Receipt paid by a Borrower in excess
of the amount required
with respect to the relevant Mortgage
Loan (and in the case of
any non-Flexible Mortgage Loan any
payment which is not a
Capital Payment), which shall be divided
into (A) the Non-Flexible
Overpayments Sub Ledger to record
Overpayments on
Non-Flexible Mortgage Loans and (B) the
Flexible Overpayments Sub
Ledger to record Overpayments on
Flexible Mortgage Loans,
in each case as received into and paid
out of the Mortgages
Trustee GIC Account from time to time;
(vi) the Non-Flexible
Underpayments Ledger, which shall record
Underpayments on
Non-Flexible Mortgage Loans from time to time;
(vii) the Re-Draws Ledger, which
will record Re-Draws on the
Flexible Mortgage Loans
and which shall be divided into (A) the
Cash Re-Draws Sub Ledger
to record Cash Re-Draws made in
respect of Flexible
Mortgage Loans and (B) the Non-Cash
Re-Draws Sub Ledger
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to record Non-Cash
Re-Draws made in respect of Flexible
Mortgage Loans;
(viii) the Contributions Ledger,
which will be divided into sub
ledgers to record the making of
Contributions to the Mortgages
Trustee pursuant to the
Mortgages Trust Deed by each of the
Funding Beneficiaries and
the Seller and the application of
such Contributions in
accordance with the terms of the
Mortgages Trust Deed by:
(A) the payment by the Mortgages Trustee to the
Seller of (1)
amounts of Initial
Purchase Price for the sale of any New
Mortgage Portfolio which is acquired by the
Mortgages
Trustee from the
Seller under the provisions of Mortgage
Sale Agreement (2)
amounts of Deferred Purchase Price in
accordance with the
Mortgage Sale Agreement or (3) amounts
of any Special
Distribution in accordance with the
Mortgages Trust Deed;
(B) the payment by the Mortgages Trustee to
Funding of amounts
of any Special
Distribution in accordance with the
Mortgages Trust Deed;
and
(ix) the Further Draws Ledger,
which will record Further Draws on
Personal Secured Loans
from time to time.
(b)
The Cash Manager shall make credits and debits to the Mortgages
Trustee Ledgers in the manner
described in paragraphs 10, 11, 12,
13, 14, 31, 32, 33 and 34 of
Schedule 2 hereto.
4.3 Funding Ledgers:
(a)
The Cash Manager shall open and maintain in the books of Funding the
following ledgers on behalf of
Funding:
(i) the Issuer Reserve Fund Ledger of any Funding
Issuer, which
shall record the amount
credited to the Issuer Reserve Fund of
such Issuer on the related
Closing Date, and subsequent
withdrawals and deposits
in respect of such Issuer Reserve
Fund;
(ii) the Issuer Liquidity
Reserve Ledger of any Funding Issuer, if
any, which shall record
the amount credited to the Issuer
Liquidity Reserve Fund
from time to time of such Issuer, and
subsequent withdrawals and
deposits in respect of such Issuer
Liquidity Reserve Fund;
(iii) the Funding Principal
Ledger, which shall separately reflect
all Funding Principal
Receipts received by Funding on each
Distribution Date and all
Funding Principal Receipts standing
to the credit of each
Funding Bank Account, and the following
sub-ledgers:
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(A) the Group 1 Principal Sub-Ledger which shall
record
receipts and payments
of Funding Principal Receipts
allocable to Group 1; and
(B) the Group 2 Principal Sub-Ledger which shall
record
receipts and payments
of Funding Principal Receipts
allocable to Group 2;
(iv) the Funding Principal Deficiency
Ledger, which shall reflect
the aggregate position of
the Issuer Principal Deficiency
Ledgers of all Funding
Issuers as to Losses on the Mortgage
Loans and the application
of Funding Available Principal
Receipts to fund Issuer
Liquidity Reserve Funds;
(v) the Funding Revenue Ledger, which shall
separately reflect all
Funding Revenue Receipts
received by Funding on each
Distribution Date and all
Funding Revenue Receipts standing to
the credit of each Funding
Bank Account, (other than any
Funding Swap Collateral
Account) and the following sub-ledgers:
(A) the Funding Expense Sub-Ledger which shall
record receipts
and payments of
Funding Revenue Receipts allocable to the
payment of expenses;
(B) the Group 1 Revenue Sub-Ledger which shall
record receipts
and payments of
Funding Revenue Receipts allocable to
Group 1; and
(C) the Group 2 Revenue Sub-Ledger which shall
record receipts
and payments of
Funding Revenue Receipts allocable to
Group 2;
(vi) the Funding Reserve
Ledger, which shall record the amount
credited to the Funding
Reserve Fund from time to time, and
subsequent withdrawals and
deposits in respect of the Funding
Reserve Fund; and
(vii) the Funding Intercompany
Loan Ledger, which shall be divided
into segregated sub
ledgers each of which shall record payments
of interest and fees and
repayments of principal made under
each Funding Intercompany
Loan.
(viii) the Funding Swap
Collateral Ledger to record all payments,
deliveries, transfers and
receipts in connection with Funding
Swap Collateral,
including, without limitation:
(A) the delivery of any Funding Swap Collateral
to Funding by
the Funding Basis
Rate Swap Provider;
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(B) the receipt of any income or distributions in
respect of
such Funding Swap
Collateral and the payment of such
income or
distributions to the Funding Basis Rate Swap
Provider;
(C) the return of all, or any part of, such
Funding Swap
Collateral to the
Funding Basis Rate Swap Provider; and
(D) the payment or transfer of all, or any part
of, such
Funding Swap
Collateral to the Funding Transaction Account
or the Funding Swap
Collateral Account,
provided that the Funding
Swap Collateral Ledger shall only be
established in the event
that the Funding Basis Rate Swap
Provider pays or transfers
Funding Swap Collateral to Funding
in accordance with the
Funding Basis Rate Swap Agreement.
(b)
The Cash Manager shall make credits and debits to the Funding
Ledgers in accordance with the
provisions of paragraphs 15 through
21 of Schedule 2 hereto.
4.4 Funding 2 Ledgers:
(a)
The Cash Manager shall open and maintain in the books of Funding 2
the following ledgers on behalf
of Funding 2:
(i) the Funding 2 Principal Ledger, which shall
separately reflect
all Funding 2 Principal
Receipts received by Funding 2 on each
Distribution Date (other
than any Funding 2 Principal Receipts
constituting the Cash
Accumulation Requirement) and all Funding
2 Principal Receipts
standing to the credit of each Funding 2
Bank Account (other than
any Funding 2 Principal Receipts
credited to the Funding 2
Cash Accumulation Ledger);
(ii) the Funding 2 Cash
Accumulation Ledger which shall separately
reflect all Funding 2
Principal Receipts received by Funding 2
on each Distribution Date
in respect of the Cash Accumulation
Requirement;
(iii) the Funding 2 Principal
Deficiency Ledger, which shall
comprise five sub-ledgers
to be known as the AAA Principal
Deficiency Sub-Ledger, the
AA Principal Deficiency Sub-Ledger,
the A Principal Deficiency
Sub-Ledger, the BBB Principal
Deficiency Sub-Ledger and
the BB Principal Deficiency
Sub-Ledger, and which
shall record (A) any principal
deficiencies arising from
Losses on the Mortgage Loans which
have been allocated to
Funding 2, (B) the application of
Funding 2 Available
Principal Receipts to meet any deficiency
in Funding 2 Available
Revenue Receipts, (C) the application of
Funding 2 Available
Principal Receipts to fund the Funding 2
Liquidity Reserve Fund and
(D) the application of Funding 2
Available Revenue Receipts
to be applied to reduce the balances
on the Funding 2 Principal
Deficiency Ledger;
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(iv) the Funding 2 Revenue
Ledger, which shall separately reflect
all Funding 2 Revenue
Receipts received by Funding 2 on each
Distribution Date, and all
Funding 2 Revenue Receipts standing
to the credit of each
Funding 2 Bank Account (other than any
Funding 2 Swap Collateral
Account);
(v) the Funding 2 Reserve Ledger, which shall
record the amount
credited to the Funding 2
Reserve Fund from time to time, and
subsequent withdrawals and
deposits in respect of the Funding 2
Reserve Fund;
(vi) the Funding 2 Liquidity
Reserve Ledger, which shall record the
amount credited to the
Funding 2 Liquidity Reserve Fund from
time to time, and
subsequent withdrawals and deposits in
respect of the Funding 2
Liquidity Reserve Fund provided that
the Funding 2 Liquidity
Reserve Ledger shall only be
established in the event
that Funding 2 is required to do so
pursuant to the terms of
the Funding 2 Deed of Charge;
(vii) the Funding 2 Liquidity
Facility Ledger which shall record all
drawings and repayments in
respect of any Funding 2 Liquidity
Facility provided that the
Funding 2 Liquidity Facility Ledger
shall only be established
in the event that Funding 2 enters
into a Funding 2 Liquidity
Agreement;
(viii) the Funding 2 Swap
Collateral Ledger to record all payments,
deliveries, transfers and
receipts in connection with Swap
Collateral, including,
without limitation:
(A) the delivery of any Swap Collateral to
Funding 2 by the
Funding 2 Basis Rate
Swap Provider;
(B) the receipt of any income or distributions in
respect of
such Swap Collateral
and the payment of such income or
distributions to the
Funding 2 Basis Rate Swap Provider;
(C)
the return of all, or any part of, such Swap Collateral to
the Funding 2 Basis
Rate Swap Provider; and
(D) the payment or transfer of all, or any part
of, such Swap
Collateral to the
Funding 2 Transaction Account or the
Funding 2 Swap
Account,
provided that the Funding
2 Swap Collateral Ledger shall only
be established in the
event that the Funding 2 Basis Rate Swap
Provider pays or transfers
Swap Collateral to Funding 2 in
accordance with the
Funding 2 Basis Rate Swap Agreement; and
(ix) the Funding 2 Intercompany
Loan Ledger, which shall be divided
into segregated
sub-ledgers each of which shall record payments
made under each Loan
Tranche (each of which shall be divided
into sub-
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<PAGE>
ledgers to record payments
of interest and fees and repayments
of principal made under
the applicable Loan Tranche).
(b)
The Cash Manager shall make credits and debits to the Funding 2
Ledgers in accordance with the
provisions of paragraphs 22 through
30 of Schedule 2 hereto.
4.5 Payments:
Mortgages Trust
(a)
The Cash Manager shall procure that so far as it may be able in
relation to all Mortgage Loans
comprised in the Mortgage Portfolio,
the following amounts are paid
into the Mortgages Trustee
Transaction Account:
(i) all Monthly Payments, other interest received
under and in
respect of the Mortgage
Loans and any costs or other amounts
received under the
Mortgage Loans (including in any such case
amounts recovered on
enforcement of rights against any Borrower
or guarantor of the
Borrower, any Mortgaged Property or any of
the Borrower's or
guarantor's other property or assets);
(ii) all final releases and all
repayments or prepayments of
principal under the
Mortgage Loans;
(iii) any amount received by or
on behalf of the Mortgages Trustee
pursuant to any Insurance
Policy; and
(iv) any other amounts
whatsoever received by or on behalf of the
Mortgages Trustee on or
after the Initial Closing Date,
(b)
The Cash Manager shall procure that the following amounts are
credited to the Mortgages
Trustee GIC Account:
(i) from time to time upon written or electronic
receipt of
instructions from the
Administrator, all amounts standing to
the credit of the
Mortgages Trustee Transaction Account; and
(ii) all interest earned on any
of (A) the Mortgages Trustee
Transaction Account, (B)
the Mortgages Trustee GIC Account and
(C) all investment
proceeds from Authorised Investments
purchased from amounts
standing to the credit of either the
Mortgages Trustee
Transaction Account or the Mortgages Trustee
GIC Account.
Funding
(c)
The Cash Manager shall procure that on each Distribution Date the
following amounts are paid into
the Funding GIC Account:
(i) all Funding Principal Receipts, PROVIDED
HOWEVER that any
amounts recorded as a
credit on the Non-Flexible Overpayments
Sub-
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<PAGE>
Ledger shall remain in the
Mortgages Trustee GIC Account on
such Distribution Date;
(ii) all Funding Revenue
Receipts; and
(iii) any other amounts
whatsoever received by or on behalf of
Funding after the Initial
Closing Date (excluding Funding Swap
Collateral),
and the Cash Manager shall
procure that all interest earned on the
Funding GIC Account and the
Funding Transaction Account and all
investment proceeds from
Authorised Investments purchased from
amounts standing to the credit
of such accounts are credited to the
Funding GIC Account.
(d)
The Cash Manager shall procure that all interest earned on each
Funding (Issuer) GIC Account
and all investment proceeds from
Authorised Investments
purchased from amounts standing to the credit
of such Funding (Issuer) GIC
Account are credited to such account.
(e)
The Cash Manager shall procure that on each Payment Date the lesser
of (1) the amount standing to
the credit of the Funding GIC Account
and (2) the aggregate of all
amounts required to be paid by Funding
to all Funding Issuers in
accordance with the relevant Funding
Priority of Payments, is credited to the
Funding Transaction Account
in accordance with the
provisions of the Funding Deed of Charge.
(f)
The Cash Manager shall procure that all transfers and withdrawals of
amounts standing to the credit
of the Funding Bank Accounts and the
Funding Swap Collateral
Accounts shall be made in accordance with
the provisions of the Funding
Deed of Charge.
Funding 2
(g)
The Cash Manager shall procure that on each Distribution Date the
following amounts are paid into
the Funding 2 GIC Account:
(i) all Funding 2 Principal Receipts, PROVIDED
HOWEVER that any
amounts recorded as a
credit on the Non-Flexible Overpayments
Sub Ledger shall remain in
the Mortgages Trustee GIC Account on
such Distribution Date;
and
(ii) all Funding 2 Revenue
Receipts; and
(iii) any other amounts
whatsoever received by or on behalf of
Funding 2 after the
Funding 2 Programme Date (excluding Swap
Collateral),
and the Cash Manager shall
procure that all interest earned on the
Funding 2 GIC Account and the
Funding 2 Transaction Account and all
investment proceeds from
Authorised Investments purchased from
amounts standing to the credit
of such accounts are credited to the
Funding 2 GIC Account.
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<PAGE>
(h)
The Cash Manager shall procure that on each Monthly Payment Date the
lesser of (1) the amount
standing to the credit of the Funding 2 GIC
Account and (2) the aggregate
of all amounts required to be paid by
Funding 2 to the Funding 2
Issuers in accordance with the relevant
Funding 2 Priority of Payments,
is credited to the Funding 2
Transaction Account in
accordance with the provisions of the Funding
2 Deed of Charge.
(i)
The Cash Manager shall procure that all transfers and withdrawals of
amounts standing to the credit
of the Funding 2 Transaction Account,
the Funding 2 GIC Account and
the Funding 2 Swap Collateral Account
shall be made in accordance
with the provisions of the Funding 2
Deed of Charge.
General
(j)
Each of the payments into the Mortgages Trustee Bank Accounts, the
Funding Bank Accounts and the
Funding 2 Bank Accounts referred to in
Clauses 4.4(a) through (i)
herein shall be made forthwith upon
receipt by the Mortgages
Trustee, Funding, Funding 2 or the Cash
Manager, as the case may be, of
the amount in question.
(k)
For the avoidance of doubt, as soon as reasonably practicable after
becoming aware of the same, the
Cash Manager may, and shall,
withdraw Cash from, as the case
may be, the Mortgages Trustee Bank
Accounts, the Funding Bank
Accounts or the Funding 2 Bank Accounts
if, and to the extent that,
such Cash was credited thereto in error
and shall use its reasonable
endeavours to ensure that such Cash is
applied correctly thereafter.
(l)
The Cash Manager shall promptly notify each of the Mortgages
Trustee, each Funding
Beneficiary and each Funding Security Trustee
of any additional account which
supplements or replaces any account
specifically referred to in the
definitions of the "Mortgages
Trustee Transaction
Account", the "Mortgages Trustee GIC Account",
the "Funding Transaction
Account", the "Funding GIC Account", any
"Funding (Issuer) GIC
Account", the "Funding 2 Transaction Account"
or the "Funding 2 GIC
Account" in the Programme Master Definitions
Schedule.
(m)
Each of the Cash Manager and the Mortgages Trustee undertakes that,
so far as it is able to procure
the same, the Mortgages Trustee Bank
Accounts and all instructions
and Mandates in relation thereto will
continue to be operative and
will not, save as provided in Clause
4.7 (Cash Management) herein or
as permitted pursuant to the Bank
Account Agreement, be changed
without the prior written consent of
the Funding Security Trustees
(such consent not to be unreasonably
withheld or delayed). For the
avoidance of doubt, the Cash Manager
may change the Authorised
Signatories in respect of any instructions
or Mandates relating to the
Mortgages Trustee Bank Accounts, without
the prior written consent of
the Funding Security Trustees, in
accordance with Clause 4.2
(Amendment or Revocation) of the Bank
Account Agreement.
(n)
Each of the Cash Manager and Funding undertakes that, so far as it
is able to procure the same,
the Funding Bank Accounts and all
instructions and
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<PAGE>
Mandates in relation thereto
will continue to be operative and will
not, save as provided in Clause
4.7 (Cash Management) herein or as
permitted pursuant to the Bank
Account Agreement or any Funding
(Issuer) Bank Account
Agreement, be changed without the prior
written consent of the Security
Trustee (such consent not to be
unreasonably withheld or
delayed). For the avoidance of doubt, the
Cash Manager may change the
Authorised Signatories in respect of any
instructions or Mandates
relating to the Funding Bank Accounts
without the prior written consent of the
Security Trustee, in
accordance with Clause 4.2
(Amendment or Revocation) of the Bank
Account Agreement or any
Funding (Issuer) Bank Account Agreement, as
the case may be.
(o) Each of the Cash Manager and Funding 2
undertakes that, so far as it
is able to procure the same,
the Funding 2 Bank Accounts and all
instructions and Mandates in
relation thereto will continue to be
operative and will not, save as
provided in Clause 4.7 (Cash
Management) herein or as
permitted pursuant to the Funding 2 Bank
Account Agreement, be changed
without the prior written consent of
the Funding 2 Security Trustee
(such consent not to be unreasonably
withheld or delayed). For the
avoidance of doubt, the Cash Manager
may change the Authorised
Signatories in respect of any instructions
or Mandates relating to the
Funding 2 Bank Accounts without the
prior written consent of the
Funding 2 Security Trustee, in
accordance with Clause 4.2
(Amendment or Revocation) of the Funding
2 Bank Account Agreement.
4.6 Withdrawals: The Cash Manager may
make withdrawals:
(a)
on behalf of the Mortgages Trustee from the Mortgages Trustee Bank
Accounts;
(b)
on behalf of Funding from the Funding Bank Accounts, but only:
(i) with the prior consent of the Security
Trustee as provided
under the Funding Deed of
Charge or following receipt of a
request for withdrawal in
writing from the Cash Manager on
behalf of Funding; and
(ii) until receipt of a Funding
Intercompany Loan Enforcement Notice
served by the Security
Trustee on Funding (with a copy to the
Funding Secured Creditors
as soon as reasonable thereafter in
accordance with and
subject to the Funding Deed of Charge);
(c)
on behalf of Funding 2 from the Funding 2 Bank Accounts, but only:
(i) with the prior consent of the Funding 2
Security Trustee as
provided under the Funding
2 Deed of Charge or following
receipt of a request for
withdrawal in writing from the Cash
Manager on behalf of Funding 2; and
(ii) until receipt of a Funding
2 Intercompany Loan Enforcement
Notice served by the
Funding 2 Security Trustee on Funding 2
(with a copy to
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<PAGE>
the Funding 2 Secured
Creditors as soon as reasonable
thereafter in accordance
with and subject to the Funding 2 Deed
of Charge),
as permitted by this Agreement
and the other Transaction Documents;
(d)
on behalf of Funding 2 from the Funding 2 Swap Collateral Account as
permitted by this Agreement and
the other Transaction Documents; and
(e)
on behalf of Funding from the Funding Swap Collateral Account as
permitted by this Agreement and other
Transaction Documents.
4.7 Cash Management: In administering
the Funding Bank Accounts on behalf of
Funding and the Security Trustee,
the Cash Manager shall comply with the
provisions of Schedule 2 hereto
prior to receipt by the Cash Manager of a
copy of any Intercompany Loan
Enforcement Notice served by the Security
Trustee on Funding. In administering
the Funding 2 Bank Accounts on
behalf of Funding 2 and the Funding
2 Security Trustee, the Cash Manager
shall comply with the provisions of
Schedule 2 hereto prior to receipt by
the Cash Manager of a copy of any
Intercompany Loan Enforcement Notice
served by the Funding 2 Security
Trustee on Funding 2.
4.8 Contributions by Funding: Following
the drawing of any Intercompany Loan
by Funding from any Funding Issuer
on any date, the Cash Manager shall
procure (i) the payment on such date
by Funding to the Mortgages Trustee
of Funding's Contribution to the
Mortgages Trustee pursuant to the
Mortgages Trust Deed and (ii) the
application of such Contribution by the
Mortgages Trustee for payment to the
Seller of either (a) the amount of
Initial Purchase Price for the sale
of any New Mortgage Portfolio which
is acquired by the Mortgages Trustee
from the Seller on such date under
the provisions of Mortgage Sale
Agreement or (b) the amount of any
Special Distribution made to the
Seller as Beneficiary under the
Mortgages Trust Deed, as applicable.
4.9 Contributions by Funding 2:
Following the drawing of any Intercompany
Loan or the drawing of any Loan
Tranche pursuant to an Intercompany Loan
Agreement by Funding 2 from any
Funding 2 Issuer on any date, the Cash
Manager shall procure:
(i)
the payment on such date (or on such other date as may be agreed
between Funding 2, the Funding
2 Security Trustee, the applicable
Funding 2 Issuer and the
applicable Issuer Security Trustee) by
Funding 2 to a Funding 2 Issuer
of an amount by way of the
refinancing (in whole or in
part) of an existing Intercompany Loan
or Loan Tranche; or
(ii) the payment on such date by
Funding 2 to the Mortgages Trustee of
Funding 2's Contribution to the
Mortgages Trustee pursuant to the
Mortgages Trust Deed and the
application of such Contribution by the
Mortgages Trustee (as directed
by Funding 2 or the Funding 2
Security Trustee) for payment
to:
(a)
the Seller of either (1) the amount of Initial Purchase Price
for the sale of any New
Mortgage Portfolio which is acquired by
the Mortgages Trustee from
the Seller on such date under the
provisions of Mortgage
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<PAGE>
Sale Agreement or (2) the
amount of any Special Distribution
made to the Seller as
Beneficiary under the Mortgages Trust
Deed, as applicable;
and/or
(b) Funding of the amount of any Special
Distribution made to
Funding as Beneficiary
under the Mortgages Trust Deed.
4.10 Funding Reserve Fund: The Cash Manager, on behalf of Funding, may utilise
the Funding Reserve Fund to fund
initial reserves and other expenses in
connection with the issuance of any
Notes by any Funding Issuer, to the
extent that such initial reserves
and expenses are to be established, or
paid for, by Funding and are not
funded pursuant to the terms of the
Issuer Start Up Loan Agreement
applicable to that Funding Issuer.
4.11 Funding 2 Reserve Fund: The Cash Manager, on behalf of Funding 2, may
utilise the Funding 2 Reserve Fund
to fund initial reserves and other
expenses in connection with the
issuance of any Notes by any Funding 2
Issuer and the making of Loan
Tranches to Funding 2, to the extent that
such reserves and expenses are to be
funded or paid for by Funding 2.
4.12 Termination of Funding 2 Basis Rate Swaps: If on or prior to the date of
the earlier of (i) repayment in full
of the Funding 2 Intercompany Loan
Agreements or (ii) the service of a
Funding 2 Intercompany Loan
Enforcement Notice on Funding 2, any
Funding 2 Basis Rate Swap under the
Funding 2 Basis Rate Swap Agreement
is terminated, the Cash Manager (on
behalf of Funding 2 and the Funding
2 Security Trustee) shall purchase a
replacement hedge on terms
acceptable to the Rating Agencies, Funding 2
and the Funding 2 Security Trustee
and with a swap provider that the
Rating Agencies have previously
confirmed in writing, to Funding 2 and
the Funding 2 Security Trustee, will
not cause the then-current ratings
of the Notes issued by the Funding 2
Issuers to be downgraded, withdrawn
or qualified. Funding 2 may apply
any early termination payment received
from, as appropriate, the Funding 2
Basis Rate Swap Provider for such
purpose. Any Swap Replacement
Premium received by Funding 2 from a
replacement swap provider upon entry into a
swap agreement replacing such
Funding 2 Basis Rate Swap shall
firstly be applied in or towards payment
of any termination payment due and
payable to the Funding 2 Basis Rate
Swap Provider following the
termination of the applicable Funding 2 Basis
Rate Swap. Any amount of such Swap
Replacement Premium not applied in or
towards payment of such termination
payment will form part of Funding 2
Available Revenue Receipts.
4.13 Funding 2 Swap Collateral:
(a)
In the event that pursuant to the terms of the Funding 2 Basis Rate
Swap Agreement, the Funding 2
Basis Rate Swap Provider pays or
transfers Swap Collateral to
Funding 2, the Cash Manager shall:
(i) if not already created, create the Funding 2
Swap Collateral
Ledger in the books of
Funding 2 so as to record the amount and
type of such Swap
Collateral and, if there is more than one
Funding 2 Basis Rate
19
<PAGE>
Swap Agreement; identify
the agreement in respect of which it
has been posted;
(ii) upon receipt of such Swap
Collateral, credit it to and record
the relevant details in
the Funding 2 Swap Collateral Ledger;
(iii) to the extent that such
Swap Collateral is in the form of
Cash, pay it into the
relevant Funding 2 Swap Collateral Cash
Account; and
(iv) to the extent that such
Swap Collateral is in the form of
securities, arrange for it
to be credited to the relevant
Funding 2 Swap Collateral
Securities Account.
(b)
Any such Swap Collateral shall not form part of the Funding 2
Available Revenue Receipts and
the Funding 2 Available Principal
Receipts; provided that if the
terms of the Funding 2 Basis Rate
Swap Agreement permit such Swap
Collateral (or any part thereof) to
be applied in or towards
satisfaction of the Funding 2 Basis Rate
Swap Provider's obligations
under the Funding 2 Basis Rate Swap
Agreement, and in the event
that such Swap Collateral (or such part
thereof) is to be so applied,
the Cash Manager shall:
(i) where such Swap Collateral is in the form of
Cash, transfer the
amount of Cash to be so
applied from the Funding 2 Swap
Collateral Cash Account to
the Funding 2 Transaction Account;
and/or
(ii) where such Swap Collateral
is in the form of securities,
realise the Swap
Collateral and pay the amount of the net
proceeds to be so applied
into the Funding 2 Transaction
Account,
and, in each case, make the appropriate
debits and credits to the
Funding 2 Swap Collateral
Ledger. Any amount transferred from the
Funding 2 Swap Collateral
Accounts to the Funding 2 Transaction
Account in accordance with this
Clause 4.13(b) will form part of the
Funding 2 Available Revenue
Receipts.
(c)
To the extent that pursuant to the terms of the Funding 2 Basis Rate
Swap Agreement, Swap Collateral
(or any income or distributions in
respect thereof) is to be returned or paid
(as applicable) to the
Funding 2 Basis Rate Swap
Provider, the Cash Manager shall:
(i) where the relevant Swap Collateral (or such
income or
distributions) is in the
form of Cash, return or pay (as
applicable) the relevant
amount of Cash out of the relevant
Funding 2 Swap Collateral
Cash Account to the Funding 2 Basis
Rate Swap Provider; and/or
(ii) where the relevant Swap
Collateral (or such income or
distributions) is in the
form of securities, transfer and
deliver the Swap
Collateral to the Funding 2 Basis Rate Swap
Provider,
and, in each case, debit the
Funding 2 Swap Collateral






