Exhibit 10.4.1
Execution Version
Dated 19 January 2005
GRANITE MASTER ISSUER PLC
as Master Issuer
NORTHERN ROCK PLC
as Issuer Start-Up Loan Provider
- and -
THE BANK OF NEW YORK
as Issuer Security Trustee
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START-UP LOAN 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: 30507-30040/678780
CONTENTS
1. Definitions and Interpretation........................................1
2. The Start-Up Loan Tranches............................................2
3. Interest..............................................................2
4. Repayment.............................................................3
5. Acceleration..........................................................4
6. Payments..............................................................4
7. Subordination and Security............................................4
8. Notices...............................................................5
9. Taxes.................................................................6
10. Remedies and Waivers..................................................6
11. Assignments and Transfer..............................................6
12. Alternative Payment Arrangements......................................7
13. Issuer Security Trustee as a Party....................................7
14. No Partnership........................................................7
15. Variation.............................................................7
16. Execution in Counterparts; Severability...............................7
17. Third Party Rights....................................................8
18. Governing Law and Jurisdiction; Appropriate Forum....................8
SCHEDULE 1 REPRESENTATIONS AND WARRANTIES.................................9
SCHEDULE 2 START-UP LOAN TRANCHE SUPPLEMENT..............................10
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THIS AGREEMENT is made on 19 January, 2005
BETWEEN:
(1) GRANITE MASTER ISSUER PLC (registered number 5250668), a private limited
company incorporated under the laws of England and Wales at Fifth Floor,
100 Wood Street, London EC2V 7EX as Master Issuer;
(2) 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 Issuer Start-Up Loan Provider; and
(3) THE BANK OF NEW YORK, whose principal office is at 48th Floor, One
Canada Square, London E14 5AL in its capacity as Issuer Security
Trustee.
WHEREAS:
(A) From time to time, the Master Issuer will issue Issuer Notes pursuant to
the Programme.
(B) Under the terms of the Global Intercompany Loan Agreement, the Master
Issuer has agreed that it will lend the proceeds (or, as applicable, the
sterling equivalent thereof) of any issue of Issuer Notes by it to
Funding 2.
(C) The Issuer Start-Up Loan Provider and the Master Issuer have agreed
that, on each occasion that the Master Issuer makes an issuance of
Issuer Notes, the Issuer Start-Up Loan Provider may make a loan to the
Master Issuer to be applied towards the funding the Issuer Reserve Fund
(in whole or in part) and/or towards the payment (in whole or in part)
of the fees and expenses incurred by the Master Issuer and Funding 2 in
respect of the issuance of the Issuer Notes and the lending of the
proceeds thereof to Funding 2.
(D) This Agreement sets out the agreement between the Master Issuer and the
Issuer Start-Up Loan Provider in relation to the making of such loans.
IT IS HEREBY AGREED as follows:
1. Definitions and Interpretation
1.1 The provisions of:
(a) the Programme Master Definitions Schedule signed for the purposes
of identification by Sidley Austin Brown & Wood and Allen & Overy
LLP on 19 January 2005; and
(b) the Issuer Master Definitions Schedule signed for the purposes of
identification by Sidley Austin Brown & Wood and Allen & Overy LLP
on 19 January 2005,
(as the same have been and may be amended, varied or supplemented from
time to time with the consent of the parties hereto) are expressly and
specifically incorporated
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into and shall apply to this Agreement. The Issuer Master Definitions
Schedule specified above shall prevail to the extent that it conflicts
with the Programme Master Definitions Schedule.
2. The Start-Up Loan Tranches
2.1 Subject to the terms of this Agreement, simultaneously with the issue by
the Master Issuer of a Series of Issuer Notes on a Closing Date, the
Issuer Start-Up Loan Provider may make available to the Master Issuer a
Start-Up Loan Tranche in the amount described in a supplement entered
into on such date by the parties hereto substantially in the form of
Schedule 3 (each such supplement being a "Start-Up Loan Tranche
Supplement").
2.2 Each Start-Up Loan Tranche made under this Agreement will only be used
by the Master Issuer for the purposes of:
(a) funding the Issuer Reserve Fund (in whole or in part); and/or
(b) funding the payment of the costs and expenses incurred by the
Master Issuer and Funding 2 in connection with the issuance by the
Master Issuer of the Issuer Notes, the making of Loan Tranches by
the Master Issuer to Funding 2 under the Global Intercompany Loan
Agreement and the acquisition by Funding 2 of an additional share
of the Trust Property using the proceeds thereof.
Each Start-Up Loan Tranche made under this Agreement shall be deposited
into the Issuer Sterling Account.
2.3 Each Start-Up Loan Tranche made under this Agreement will constitute a
separate debt due from the Master Issuer to the Issuer Start-Up Loan
Provider.
3. Interest
3.1 The first Interest Period in respect of each Start-Up Loan Tranche made
under this Agreement will commence on (and include) the Closing Date in
relation to that Start-Up Loan Tranche (as specified in the applicable
Start-Up Loan Tranche Supplement) and end on (but exclude) the first
Monthly Payment Date falling thereafter. Each subsequent Interest Period
in respect of each Start-Up Loan Tranche made under this Agreement shall
commence on (and include) a Monthly Payment Date and end on (but
exclude) the next following Monthly Payment Date.
3.2 Prior to the service of an Issuer Enforcement Notice, the Master Issuer
shall pay interest on each Start-Up Loan Tranche made under this
Agreement in arrear on each Monthly Payment Date. Such payment will be
made if, and only to the extent that, there are Issuer Available Revenue
Receipts available therefor after making the payments and provisions
referred to in the Issuer Pre-Enforcement Revenue Priority of Payments.
The amount of interest due on each Start-Up Loan Tranche made under this
Agreement will rank pari passu with the amount of interest due on each
other Start-Up Loan Tranche and will be paid pro rata among such
Start-Up Loan Tranches.
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3.3 Each Start-Up Loan Tranche made under this Agreement will bear interest
calculated in accordance with Clause 3.4 at the rate specified in the
applicable Start-Up Loan Tranche Supplement.
3.4 Interest shall be calculated on each Start-Up Loan Tranche made under
this Agreement by reference to any Interest Period on the basis of the
actual number of days elapsed and a 365 day year (or, in the case of a
leap year, a 366 day year).
3.5 Subject to Clause 4.3, to the extent that there are insufficient funds
available to pay, on any Monthly Payment Date, interest accrued on a
Start-Up Loan Tranche made under this Agreement, the shortfall in the
interest amount payable will not then fall due but will instead be due
on the following Payment Date on which sufficient funds are available to
pay such interest, and pending such payment, will accrue interest at the
rate specified in the applicable Start-Up Loan Tranche Supplement.
4. Repayment
4.1 Prior to the service of an Issuer Enforcement Notice, the Master Issuer
shall repay principal of each Start-Up Loan Tranche made under this
Agreement on each Monthly Payment Date. Such repayment will be made if,
and only to the extent that, there are Issuer Available Revenue Receipts
available therefor after making the payments and provisions referred to
in the Issuer Pre-Enforcement Revenue Priority of Payments. The
obligation to repay each Start-Up Loan Tranche made under this Agreement
will rank pari passu with the obligation to repay each other Start-Up
Loan Tranche made under this Agreement and will be paid pro rata among
such Start-Up Loan Tranches.
4.2 The Issuer Cash Manager is responsible, pursuant to the Issuer Cash
Management Agreement, for determining:
(a) the interest and principal amounts payable by the Master Issuer
under Clause 3 and Clause 4 of this Agreement; and
(b) the amount of Issuer Available Revenue Receipts as at any Payment
Date available therefor,
and each determination so made shall (in the absence of negligence,
wilful default, bad faith or manifest error) be final and binding on the
Issuer Start-Up Loan Provider.
4.3 Subject to Clauses 5 (but not withstanding any other terms of this
Agreement), on the earlier to occur of:
(a) any Monthly Payment Date on which all Issuer Notes issued by the
Master Issuer have been repaid in full; or
(b) the Final Maturity Date of the last outstanding Series and Class
of Notes,
each Start-Up Loan Tranche made under this Agreement (including any
interest accrued but unpaid), shall, subject to the Issuer Deed of
Charge, become immediately due and payable.
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4.4 The Issuer Start-Up Loan Provider hereby acknowledges that from time to
time the Master Issuer may enter into other Start-Up Loan Agreements
with other Issuer Start-Up Loan Providers and that the obligation of the
Master Issuer to repay the Start-Up Loan Tranches made under this
Agreement and any Start-Up Loan Tranches made under any other Start-Up
Loan Agreement will rank pari passu and will be paid pro rata between
themselves. The Issuer Start-Up Loan Provider further acknowledges that
the Issuer Pre-Enforcement Revenue Priority of Payments and the Issuer
Post-Enforcement Priority of Payments set out in the Issuer Deed of
Charge, respectively, may be amended to reflect the entry by the Master
Issuer into another Start-Up Loan Agreement and related agreements from
time to time and agrees to execute such documents as are necessary or
required by the Rating Agencies for the purpose of including any other
Issuer Start-Up Loan Provider (and any other relevant party) in the
Transaction Documents to effect those amendments.
5. Acceleration
5.1 Each Start-Up Loan Tranche made under this Agreement (including any
interest accrued but unpaid) shall, subject to the Issuer Deed of
Charge, become immediately due and payable following the service of an
Issuer Enforcement Notice on the Master Issuer.
6. Payments
6.1 All payments to be made hereunder by the Master Issuer shall be made in
sterling in immediately available cleared funds to the Issuer Start-Up
Loan Provider's account as specified in writing to the Master Issuer for
this purpose. If any sum falls due hereunder otherwise than on a London
Business Day, it shall be paid on the next succeeding London Business
Day.
6.2 Following the service of an Issuer Enforcement Notice on the Master
Issuer, all amounts of interest, principal and any other amounts due
hereunder shall be paid only after making the payments and provisions
referred to in the Issuer Post-Enforcement Priority of Payments.
7. Subordination and Security
7.1 The parties hereby agree that repayments in respect of each Start-Up
Loan Tranche made under this Agreement shall be subordinated to, inter
alia, payments of principal and interest on the Issuer Notes and all
other payments or provisions ranking in priority to payments to be made
to the Issuer Start-Up Loan Provider under this Agreement in accordance
with the Issuer Priority of Payments and the Issuer Deed of Charge.
7.2 If there are Issuer Available Revenue Receipts available but the Master
Issuer fails to pay interest or repay principal in respect of any
Start-Up Loan Tranche, such non-repayment will cause each Start-Up Loan
Tranche made under this Agreement (including any interest accrued but
unpaid) to become immediately due and payable.
7.3 The Master Issuer undertakes that its obligations to the Issuer Start-Up
Loan Provider hereunder shall at all times be secured by the Issuer Deed
of Charge.
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7.4 The Issuer Start-Up Loan Provider further covenants that, except as
permitted under the Issuer Deed of Charge, it will not set off or claim
to set off any Start-Up Loan Tranche made under this Agreement
(including any interest accrued but unpaid) or any part thereof against
any liability owed by it to the Master Issuer under this Agreement.
7.5 The Issuer Start-Up Loan Provider hereby undertakes to each of the other
parties hereto that it shall not take any steps for the purpose of
recovering any amount payable under this Agreement (including, without
limitation, by exercising any rights of set-off) or enforcing any rights
arising out of this Agreement against the Master Issuer and it shall not
take any steps or legal proceedings for the winding-up, dissolution or
reorganisation of, or the institution of insolvency proceedings against,
the Master Issuer or for the appointment of a receiver, administrator,
liquidator or similar officer of the Master Issuer in respect of any or
all of its revenues except to the extent expressly permitted under the
Issuer Deed of Charge.
7.6 Northern Rock plc, as the initial Issuer Start-Up Loan Provider,
represents that it is within the charge to UK corporation tax in respect
of any interest payable to it under this Agreement.
7.7 The Issuer Start-Up Loan Provider for the time being shall notify the
Master Issuer in writing promptly, and in any event before the next
following Monthly Payment Date, if it is not, or ceases to be, within
the charge to UK corporation tax in respect of any interest payable to
it under this Agreement.
7.8 Each party to this Agreement other than the Issuer Security Trustee
hereby makes the representations and warranties to each of the other
parties to this Agreement that are specified in Schedule 1 hereto.
8. Notices
Any notices to be given pursuant to this Agreement or to any of the
parties hereto shall be sufficiently served if sent by prepaid first
class post or by facsimile transmission and shall be deemed to be given
(in the case of facsimile transmission) when despatched, (where
delivered by hand) on the day of delivery if delivered before 17.00
hours on a Business Day or on the next Business Day if delivered
thereafter or (in the case of first class post) when it would be
received in the ordinary course of the post and shall be sent:
(a) in the case of the Master Issuer , to Granite Master Issuer plc,
Fifth Floor, 100 Wood Street, London EC2V 7EX (facsimile number
020 7696 5243 for the attention of the Company Secretary with a
copy to Northern Rock plc, Northern Rock House, Gosforth,
Newcastle upon Tyne NE3 4PL Facsimile: 0191 213 2203 for the
attention of the Group Secretary;
(b) in the case of the Issuer Start-Up Loan Provider, to Northern Rock
plc, Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL
Facsimile: 0191 213 2203 for the attention of the Group Secretary;
and
(c) in the case of the Issuer Security Trustee, to The Bank of New
York, 48th Floor, One Canada Square, London E14 5AL (facsimile 020
7964 6399) for
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the attention of Corporate Trust Administration,
or to such other address or facsimile number as may from time to time be
notified by any party to the other by written notice in accordance with
the provisions of this Clause 8.
9. Taxes
9.1 All payments to be made by the Master Issuer to the Issuer Start-Up Loan
Provider hereunder shall be made free and clear of and without deduction
for or on account of Tax unless the Master Issuer is required by law to
make such a payment subject to the deduction or withholding of Tax, in
which case the Master Issuer shall promptly upon becoming aware thereof
notify the Issuer Start-Up Loan Provider of such obligation, and shall
make such payments subject to such deduction or withholding of Tax which
it is required to make.
9.2 If the Master Issuer makes any payment hereunder in respect of which it
is required to make any deduction or withholding, it shall pay the full
amount required to be deducted or withheld to the relevant taxation or
other authority within the time allowed for such payment under
applicable law and shall deliver to the Issuer Start-Up Loan Provider,
within thirty days after such payment falls due to the applicable
authority, any original receipt (or a certified copy thereof) issued by
such authority evidencing such payment.
9.3 The Master Issuer shall co-operate with any person to whom rights under
this Agreement are assigned or transferred in accordance with Clause
11.1 in completing any procedural formalities necessary for the Master
Issuer to obtain authorisation to make payments of interest to such
person without deduction or withholding for or on account of tax.
9.4 For the avoidance of doubt, the Master Issuer shall not in any
circumstances be obliged to gross up any payment made by it hereunder
for any deduction or withholding for or on account of tax, whether such
deduction or withholding results from a delay in the Master Issuer
receiving any authorisation described in Clause 9.3 or otherwise.
10. Remedies and Waivers
No failure by the Issuer Start-Up Loan Provider to exercise, nor any
delay by the Issuer Start-Up Loan Provider in exercising, any right or
remedy hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any right or remedy prevent any further or other
exercise thereof or the exercise of any other right or remedy. The
rights and remedies herein provided are cumulative and not exclusive of
any rights or remedies provided by law.
11. Assignments and Transfer
11.1 The Master Issuer (other than in respect of any assignment by way of
security pursuant to the Issuer Deed of Charge) may not assign and/or
transfer any of its rights and/or obligations under this Agreement. The
Issuer Start-Up Loan Provider may assign and/or transfer its rights
under this Agreement without obtaining the prior
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written consent of the Master Issuer to any person provided that such
assignee or transferee agrees to be bound by the provisions contained in
the Issuer Deed of Charge as if it were named as an original party
thereto in place of the Issuer Start-Up Loan Provider.
11.2 If there is any change in the identity of the Issuer Security Trustee
pursuant to the terms of the Issuer Deed of Charge, the Issuer Start-Up
Loan Provider and the Master Issuer shall execute such documents and
take such actions as the new security trustee and the outgoing security
trustee may reasonably require for the purpose of vesting in the new
security trustee the rights and obligations of the outgoing security
trustee and releasing the outgoing security trustee from its future
obligations under this Agreement.
12. Alternative Payment Arrangements
If at any time it shall become impracticable for the Master Issuer to
make any payments hereunder in the manner specified in Clause 6.1, then
the parties hereto may agree alternative arrangements for such payments
to be made.
13. Issuer Security Trustee as a Party
The Issuer Security Trustee has agreed to become a party to this
Agreement for the better preservation and enforcement of its rights
under this Agreement and the Issuer Security Trustee shall assume no
obligations or liabilities whatsoever to the Issuer Start-Up Loan
Provider or to the Master Issuer. Furthermore, any liberty or power
which may be exercised or any determination which may be made hereunder
by the Issuer Security Trustee may be exercised or made in the Issuer
Security Trustee's absolute discretion without any obligation to give
reasons therefor, but in any event must be exercised or made in
accordance with the provisions of the Issuer Deed of Charge.
14. No Partnership
Nothing in this Agreement (or in any of the arrangements contemplated
hereby) shall, or shall be deemed to, constitute a partnership amongst
the parties hereto.
15. Variation
No variation of this Agreement shall be effective unless it is in
writing and signed by or on behalf of each of the parties hereto.
16. Execution in Counterparts; Severability
16.1 This Agreement may be executed in any number of counterparts (manually
or by facsimile) and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and
the same instrument.
16.2 Where any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations
under this Agreement, or of such provision or obligation in any other
jurisdiction, shall not be affected or impaired thereby.
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17. Third Party Rights
A person who is not a party to this Agreement may not enforce any of its
terms under the Contracts (Rights of Third Parties) Act 1999, but this
shall not affect any right or remedy of a third party which exists or is
available apart from that Act.
18. Governing Law and Jurisdiction; Appropriate Forum
18.1 This Agreement is governed by, and shall be construed in accordance
with, English law.
18.2 Each of the parties hereto irrevocably agrees that the courts of England
are to have jurisdiction to settle any suit, action or proceeding and to
settle any disputes which may arise out of or in connection with this
Agreement and, for such purposes, irrevocably submit to the jurisdiction
of such courts.
18.3 Each of the parties hereto irrevocably waives any objection which it
might now or hereafter have to the courts of England being nominated as
the forum to hear and determine any Proceedings and to settle any
disputes, and agrees not to claim that any such court is not a
convenient or appropriate forum.
IN WITNESS WHEREOF the parties have caused this Agreement to be duly executed
as of the date first above written.
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SCHEDULE 1
REPRESENTATIONS AND WARRANTIES
Each party to the Start-Up Loan Agreement (the "Agreement") hereby makes the
following representations and warranties to each of the other parties to such
Agreement:
1. Status: It is duly incorporated, validly existing and registered under
the laws of the jurisdiction in which it is incorporated, capable of
being sued in its own right and not subject to any immunity from any
proceedings, and it has the power to own its property and assets and to
carry on its business as it is being conducted.
2. Powers and authority: It has the power to enter into, perform and
deliver, and has taken all necessary corporate and other action to
authorise the execution, delivery and performance by it of the
Agreement, which has been duly executed and delivered by it.
3. Legal validity: The Agreement constitutes, or when executed in
accordance with its terms will constitute, its legal, valid and binding
obligation.
4. Non-conflict: The execution by it of the Agreement and the exercise by
it of its rights and the performance of its obligations under the
Agreement will not:
(a) result in the existence or imposition of, nor oblige it to create,
any Security Interest in favour of any person over all or any of
its present or future revenues or assets save for any which are
created under or pursuant to the Issuer Deed of Charge;
(b) conflict with any document which is binding upon it or any of its
assets;
(c) conflict with its constitutional documents; or
(d) conflict with any law, regulation or official or judicial order of
any government, governmental body or court, domestic or foreign,
having jurisdiction over it.
5. No litigation: It is not a party to any material litigation,
arbitration or administrative proceedings and, to its knowledge, no
material litigation, arbitration or administrative proceedings are
pending or threatened against it.
6. Consents and Licences: All governmental consents, licences and other
approvals and authorisations required in connection with the entry
into, performance, validity and enforceability of, the transaction
contemplated by the Agreement have been obtained or effected (as
appropriate) and are in full force and effect.
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Exhibit 10.4.2
SCHEDULE 2
START-UP LOAN TRANCHE SUPPLEMENT
This Start-Up Loan Tranche Supplement is made between Northern Rock plc (the
"Issuer Start-Up Loan Provider"), Granite Master Issuer plc ("Master Issuer")
and the Bank of New York (the "Issuer Security Trustee") in relation to the
provision of a Start-Up Loan Tranche by the Issuer Start-Up Loan Provider to
the Master Issuer on the following terms:
o Closing Date - [o]
o Principal amount - (pound)[o]
o Interest rate - [o]
o Payment Dates - [o]
Capitalised terms used and not otherwise defined herein shall have the
meanings assigned to them in the start-up loan agreement dated [o] January,
2005 between the parties hereto.
This Start-Up Loan Tranche Supplement is made on [o] January, 2005.
Master Issuer
Executed by
GRANITE MASTER ISSUER PLC
as follows:
Signed for and on its behalf by one of its duly
authorised attorneys/signatories By___________________________________
Duly Authorised Attorney/Signatory
Name____________________________________
The Issuer Start-Up Loan Provider
Executed by
NORTHERN ROCK PLC
as follows: By___________________________________
Signed for and on its behalf by one of its duly Duly Authorised Attorney/Signatory
authorised attorneys/signatories
Name____________________________________
The Issuer Security Trustee
Executed by
BANK OF NEW YORK
as follows: By___________________________________
Signed for and on its behalf by one of its duly Duly Authorised Attorney/Signatory
authorised attorneys/signatories
Name____________________________________
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EXECUTION PAGE
as Master Issuer
EXECUTED for and on behalf of )
GRANITE MASTER ISSUER PLC )
acting by a director )
- -------------------------
Name:
as Issuer Start-Up Loan Provider
EXECUTED for and on behalf of )
NORTHERN ROCK PLC )
by )
- -------------------------
Name:
as Issuer Security Trustee
EXECUTED for and on behalf of )
THE BANK OF NEW YORK )
by )
- -------------------------
Name:
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