Exhibit 4.9

 

 

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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NINTH AMENDED CASH MANAGEMENT AGREEMENT

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SIDLEY AUSTIN (UK) LLP

WOOLGATE EXCHANGE

25 BASINGHALL STREET

LONDON EC2V 5HA

TELEPHONE 020 7360 3600

FACSIMILE 020 7626 7937

 

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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................................................23

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..........................................................33

15. Confidentiality........................................................34

16. No Partnership.........................................................34

17. Assignment.............................................................34

18. The Funding Security Trustees..........................................35

19. New Intercompany Loan Agreements.......................................36

20. Non Petition Covenant; Limited Recourse................................36

21. Amendments and Waiver..................................................38

22. Notices................................................................39

23. Third Party Rights.....................................................40

24. Execution in Counterparts; Severability................................40

 

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25. Governing Law and Submission to Jurisdiction...........................40

SCHEDULE 1 The Cash Management Services.....................................42

SCHEDULE 2 Cash Management and Maintenance of Ledgers.......................47

SCHEDULE 3A Form of Mortgages Trustee Quarterly Report......................68

SCHEDULE 3B Form of Funding Quarterly Report................................69

SCHEDULE 3C Form of Funding 2 Quarterly Report..............................72

SCHEDULE 4 Cash Manager Representations and Warranties......................75

 

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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,

23 DECEMBER 2005 AND 19 JANUARY, 2007 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 68 King

William Street, London EC4N 7DZ 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 40th 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.

 

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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

 

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31 January, 2005, or such later date as Funding 2 and the Seller may

agree, the 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.

 

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(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 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.

 

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(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 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

 

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to be applied to reduce the balances on the Funding 2

Principal Deficiency Ledger;

(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

 

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(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-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

 

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(c) The Cash Manager shall procure that 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-Ledger shall remain in the Mortgages

Trustee GIC Account (save as otherwise provided in this

Agreement);

(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 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 (save as otherwise provided in this

Agreement); 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),

 

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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.

(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

 

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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 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:

 

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(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 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

 

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(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 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:

 

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(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 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

 

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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 Ledger as

appropriate.

(d) The terms of this Clause 4.13 shall prevail if and to the extent

that they are inconsistent with the other paragraphs of this

Clause 4.

(e) If, in relation to Swap Collateral, there is any conflict between

the terms of the Funding 2 Basis Rate Swap Agreement, the Funding

2 Deed of Charge and/or this Agreement, the terms of the Funding 2

Basis Rate Swap Agreement shall apply.

4.14 Termination of Funding Basis Rate Swaps: If on or prior to the date of

the earlier of (i) repayment in full of the Funding Intercompany Loan

Agreements or (ii) the service of a Funding Intercompany Loan

Enforcement Notice on Funding, any Funding Basis Rate Swap under the

Funding Basis Rate Swap Agreements is terminated, the Cash Manager (on

behalf of Funding and the Funding Security Trustee) shall purchase a

replacement hedge on terms acceptable to the Rating Agencies, Funding

and the Funding Security Trustee and with a swap provider that the

Rating Agencies have previously confirmed in writing, to Funding and the

Funding Security Trustee, will not cause the then-current ratings of the

Notes issued by the Funding Issuers to be downgraded, withdrawn or

qualified. Funding may apply any early termination payment received

from, as appropriate, the Funding Basis Rate Swap Provider for such

purpose. Any Funding Swap Replacement Premium received by Funding from a

replacement swap provider upon entry into a swap agreement replacing

such Funding Basis Rate Swap shall firstly be applied in or towards

payment of any termination payment due and payable to the Funding Basis

Rate Swap Provider following the termination of the applicable Funding

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 Available Revenue Receipts.

4.15 Funding Swap Collateral:

(a) In the event that pursuant to the terms of any of the Funding

Basis Rate Swap Agreements, the Funding Basis Rate Swap Provider

pays or transfers Funding Swap Collateral to Funding, the Cash

Manager shall:

(i) if not already created, create the Funding Swap Collateral

Ledger in the books of Funding so as to record the amount

and type of such Funding Swap Collateral and identify the

Funding Basis Rate Swap Agreement in respect of which it has

been posted;

(ii) upon receipt of such Funding Swap Collateral, credit it to

and record the relevant details in the Funding Swap

Collateral Ledger;

 

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(iii) to the extent that such Funding Swap Collateral is in the

form of Cash, pay it into the relevant Funding Swap

Collateral Cash Account; and

(iv) to the extent that such Funding Swap Collateral is in the

form of securities, arrange for it to be credited to the

relevant Funding Swap Collateral Securities Account.

(b) Any such Funding Swap Collateral shall not form part of the

Funding Available Revenue Receipts and the Funding Available

Principal Receipts; provided that if the terms of the Funding

Basis Rate Swap Agreement permit such Funding Swap Collateral (or

any part thereof) to be applied in or towards satisfaction of the

Funding Basis Rate Swap Provider's obligations under the Funding

Basis Rate Swap Agreement, and in the event that such Funding Swap

Collateral (or such part thereof) is to be so applied, the Cash

Manager shall:

(i) where such Funding Swap Collateral is in the form of Cash,

transfer the amount of Cash to be so applied from the

Funding Swap Collateral Cash Account to the Funding

Transaction Account; and/or

(ii) where such Funding Swap Collateral is in the form of

securities, realise the Funding Swap Collateral and pay the

amount of the net proceeds to be so applied into the Funding

Transaction Account,

and, in each case, make the appropriate debits and credits to the

Funding Swap Collateral Ledger. Any amount transferred from the

Funding Swap Collateral Accounts to the Funding Transaction

Account in accordance with this Clause 4.15(b) will form part of

the Funding Available Revenue Receipts.

(c) To the extent that pursuant to the terms of the Funding Basis Rate

Swap Agreement, Funding Swap Collateral (or any income or

distributions in respect thereof) is to be returned or paid (as

applicable) to the Funding Basis Rate Swap Provider, the Cash

Manager shall:

(i) where the relevant Funding 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 Swap Collateral Cash Account to the Funding Basis

Rate Swap Provider; and/or

(ii) where the relevant Funding Swap Collateral (or such income

or distributions) is in the form of securities, transfer and

deliver the Funding Swap Collateral to the Funding Basis

Rate Swap Provider,

and, in each case, debit the Funding Swap Collateral Ledger as

appropriate.

(d) The terms of this Clause 4.15 shall prevail if and to the extent

that they are inconsistent with the other paragraphs of this

Clause 4.

(e) If, in relation to Funding Swap Collateral, there is any conflict

between the terms of the Funding Basis Rate Swap Agreement, the

Funding Deed of

 

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Charge and/or this Agreement, the terms of the Funding Basis Rate

Swap Agreement shall apply.

5. Early Repayment Charges

The Cash Manager shall withdraw any Early Repayment Charges paid into

the Mortgages Trustee Bank Accounts and pay the same to the Seller, by

telegraphic transfer to such account as may be specified by the Seller

from time to time, promptly following a request for such withdrawal

being received from the Seller. For the avoidance of doubt, the Cash

Manager shall not record the receipt or withdrawal of Early Repayment

Charges in any of the ledgers maintained under this Agreement.

6. No Liability

Save as otherwise provided in this Agreement, the Cash Manager shall

have no liability for the obligations of any of the Mortgages Trustee,

each Funding Beneficiary or each Funding Security Trustee under any of

the Transaction Documents or otherwise and nothing herein shall

constitute a guarantee, or similar obligation, by the Cash Manager of

any of the Mortgages Trustee, each Funding Beneficiary or each Funding

Security Trustee in respect of any of them.

7. Costs and Expenses

7.1 Each Funding Beneficiary and the Mortgages Trustee, proportionately in

accordance with and subject to the applicable Funding Priority of

Payments, the applicable Funding 2 Priority of Payments or the

applicable Mortgages Trustee Priority of Payments, as the case may be,

will on each Distribution Date, Payment Date or Monthly Payment Date (as

applicable) reimburse the Cash Manager for all out-of-pocket costs,

expenses and charges (together with any amounts in respect of

Irrecoverable VAT due thereon) properly incurred by the Cash Manager in

the performance of the Cash Management Services including any such

costs, expenses or charges not reimbursed to the Cash Manager on any

previous Distribution Date, Payment Date or Monthly Payment Date (as

applicable) and the Cash Manager shall supply each Funding Beneficiary

and/or the Mortgages Trustee with an appropriate VAT invoice issued by

the Cash Manager or, if the Cash Manager has treated the relevant cost,

expense or charge as a disbursement for VAT purposes, by the person

making the supply.

7.2 Unless and until otherwise agreed by the Mortgages Trustee, the Funding

Beneficiaries and the Funding Security Trustees in writing (notified to

the Cash Manager), each Funding Beneficiary and the Mortgages Trustee

shall be jointly and severally responsible for reimbursing the Cash

Manager for the out-of-pocket costs, expenses and charges (together with

any amounts in respect of Irrecoverable VAT due thereon) referred to in

Clause 7.1 herein.

8. Information

8.1 Use of information technology systems:

 

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(a) The Cash Manager represents and warrants that at the date hereof

in respect of the software which is to be used by the Cash Manager

in providing the Cash Management Services it has in place all

necessary licences and/or consents from the respective licensor or

licensors (if any) of such software.

(b) The Cash Manager undertakes that it shall for the duration of this

Agreement, use reasonable endeavours to:

(i) ensure that the licences and/or consents referred to in

paragraph (a) are maintained in full force and effect; and

(ii) except insofar as it would breach any other of its legal

obligations, grant to any person to whom it may sub-contract

or delegate the performance of all or any of its powers and

obligations under this Agreement and/or to such person as

the Mortgages Trustee, the Funding Beneficiaries and the

Funding Security Trustees elect as a substitute cash manager

in accordance with the terms of this Agreement a licence to

use any proprietary software together with any updates which

may be made thereto from time to time.

(c) The Cash Manager shall use reasonable endeavours to maintain in

working order the information technology systems used by the Cash

Manager in providing the Cash Management Services.

(d) The Cash Manager shall pass to any person to whom it may

sub-contract or delegate the performance of all or any of its

powers and obligations under this Agreement and/or to such person

as the Mortgages Trustee, the Funding Beneficiaries and the

Funding Security Trustees elect as a substitute cash manager in

accordance with the terms of this Agreement the benefit of any

warranties in relation to the software insofar as the same are

capable of assignment.

8.2 Bank Account Statements: The Cash Manager shall take all reasonable

steps to ensure that it receives:

(a) a monthly bank statement in relation to each of the Mortgages

Trustee Bank Accounts (and any additional or supplemental bank

account of the Mortgages Trustee) and that it furnishes a copy of

such statements to the Mortgages Trustee, each of the

Beneficiaries and each Funding Security Trustee (upon its

request); and

(b) monthly bank statements in relation to each of the Funding Bank

Accounts (and any additional or supplemental bank account of

Funding) and that it furnishes a copy of such statements to

Funding and the Security Trustee (upon its request).

(c) monthly bank statements in relation to each of the Funding 2 Bank

Accounts (and any additional or supplemental bank account of

Funding 2) and that it

 

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<PAGE>

 

furnishes a copy of such statements to Funding 2 and the Funding 2

Security Trustee (upon its request).

8.3 Access to Books and Records: Subject to all applicable laws, the Cash

Manager shall permit the Mortgages Trustee (and its auditors), each

Funding Beneficiary (and its auditors) and each Funding Security Trustee

and/or any other person nominated by the Funding Security Trustees or

the Beneficiaries (to whom the Cash Manager has no reasonable objection)

at any time during normal office hours upon reasonable notice to have

access, or procure that such person or persons are granted access, to

all books of record and account relating to the Cash Management Services

provided by the Cash Manager and related matters in accordance with this

Agreement.

8.4 Statutory Obligations: The Cash Manager will use its reasonable

endeavours on behalf of the Mortgages Trustee and each Funding

Beneficiary, to prepare or procure the preparation of and file all

reports, annual returns, financial statements, statutory forms and other

returns which the Mortgages Trustee and each Funding Beneficiary is

required by law to prepare and file. Subject to approval thereof by the

directors of the Mortgages Trustee or the applicable Funding Beneficiary

(as appropriate), the Cash Manager shall cause such accounts to be

audited by the Auditors and shall procure so far as it is able so to do

that the Auditors shall make a report thereon as required by law. Copies

of all documents referred to in this Clause 8.4 which relate to the

Mortgages Trustee shall be delivered to the Mortgages Trustee, each

Funding Beneficiary, each Funding Security Trustee and the Rating

Agencies. Copies of all documents referred to in this Clause 8.4 which

relate to Funding shall be delivered to Funding, the Security Trustee

and the Rating Agencies. Copies of all documents referred to in this

Clause 8.4 which relate to Funding 2 shall be delivered to Funding 2,

the Funding 2 Security Trustee and the Rating Agencies. In each case,

such documents shall be delivered soon as practicable after the end of

each accounting reference period of the Mortgages Trustee or the

applicable Funding Beneficiary (as appropriate).

8.5 Information Covenants:

(a) The Cash Manager shall:

(a) provide the Mortgages Trustee, each Funding Beneficiary,

each Funding Security Trustee (upon its request), the Seller

and the Rating Agencies quarterly with a report in, or

substantially in, the form set out in Schedule 3A hereto in

respect of the Mortgages Trustee;

(b) provide the Mortgages Trustee, Funding, the Security Trustee

(upon its request), the Seller and the Rating Agencies

quarterly with a report in, or substantially in, the form

set out in Schedule 3B hereto in respect of Funding; and

(c) provide the Mortgages Trustee, Funding 2, the Funding 2

Security Trustee (upon its request), the Seller and the

Rating Agencies quarterly with a report in, or substantially

in, the form set out in Schedule 3C hereto in respect of

Funding 2; and

 

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Such reports shall be delivered to the Mortgages Trustee, the

applicable Funding Beneficiary, the applicable Funding Security

Trustee, the Seller and the Rating Agencies (in the case of the

Mortgages Trustee and Funding) by the last Business Day of the

month in which each Payment Date occurs and (in the case of

Funding 2) by the last Business Day of each month.

(b) The Cash Manager shall notify the Rating Agencies and each Funding

Security Trustee in writing of the details of (i) any material

amendment to the Transaction Documents of which it is or becomes

aware, (ii) the occurrence of an Intercompany Loan Event of

Default or Potential Intercompany Loan Event of Default and (iii)

any other information relating to the Cash Manager as the Rating

Agencies and/or each Funding Security Trustee may reasonably

request in connection with its obligations under this Agreement,

PROVIDED THAT any such request by any Funding Security Trustee

does not adversely interfere with the Cash Manager's day-to-day

provision of the Cash Management Services under the other terms of

this Agreement.

(c) After becoming aware of any event described in paragraph (b)(i)

and (ii) above, the Cash Manager shall give details to the

Mortgages Trustee, each Funding Beneficiary and each Funding

Security Trustee of any pending legal action and any judgments

given in respect of the Cash Manager if it could have a potential

material adverse effect on the ability of the Cash Manager to

perform its obligations hereunder.

(d) The Cash Manager shall, at the request of the Funding Security

Trustees, furnish each Funding Security Trustee and the Rating

Agencies with such other information relating to its business and

financial condition as the Funding Security Trustees may request

in connection with this Agreement, PROVIDED THAT the Funding

Security Trustees shall not make such a request more than once

every three months unless, in the belief of the Funding Security

Trustees, an Intercompany Loan Event of Default, a Note Event of

Default or a Cash Manager Termination Event (as defined in Clause

12.1 herein (Cash Manager Termination Events)) shall have occurred

and is continuing or a Potential Intercompany Loan Event of

Default or a Potential Note Event of Default shall have occurred

and is continuing or may reasonably be expected to occur, PROVIDED

THAT any such request by the Funding Security Trustees does not

adversely interfere with the Cash Manager's day to day provision

of the Cash Management Services under the other terms of this

Agreement.

8.6 Together Connections Mortgage Loans and Connections Mortgage Loans:

(a) The Seller shall, upon request, use its reasonable endeavours to:

(i) provide the Cash Manager with such information (including,

but not limited to documentary information) in its

possession; and

(ii) do such other acts and things,

 

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that the Cash Manager may require in order for the Cash Manager to

exercise its rights and comply with its obligations with respect

to the Together Connections Mortgage Loans and the Connections

Mortgage Loans and under the Transaction Documents with respect to

the administration of such Mortgage Loans.

(b) The Cash Manager shall, upon request, use its reasonable

endeavours to:

(i) provide the Seller with such information (including, but not

limited to documentary information) in its possession; and

(ii) do such other acts and things,

that the Seller may require in order for the Seller to, exercise

its rights and comply with its obligations under the Together

Connection Conditions and the Connection Conditions (where such

rights and obligations are not required to be administered by the

Mortgages Trustee, any Funding Beneficiary, the Administrator or

the Cash Manager under the Transaction Documents) and in respect

of the products linked to the Together Connections Mortgage Loans

and the Connections Mortgage Loans.

9. Remuneration

9.1 Fee payable:

(a) Subject to paragraph (b) below, the Mortgages Trustee and each

Funding Beneficiary, proportionately in accordance with and

subject to the applicable Funding Priority of Payments, the

applicable Funding 2 Priority of Payments and the applicable

Mortgages Trustee Priority of Payments, as the case may be, shall

pay to the Cash Manager for its Cash Management Services hereunder

an annual cash management fee of (GBP)200,000 for its services

which will be paid quarterly.

(b) Unless and until otherwise agreed by the Mortgages Trustee, the

Funding Beneficiaries and the Funding Security Trustees in writing

(notified to the Cash Manager), the Mortgages Trustee and each

Funding Beneficiary shall be j