<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 5, 1998
REGISTRATION NO. 333-46945
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
PRE-EFFECTIVE AMENDMENT NO. 2 TO
FORM S-11
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
(ACN 081 709 211)
(Exact name of registrant as specified in its governing instruments)
LEVEL 4, 60 MARTIN PLACE
SYDNEY, NSW 2000
AUSTRALIA
TELEPHONE: 612-9226-3589
(Address, including zip code/post code, and telephone number, including area
code, of registrant's principal executive offices)
------------------------------
LEWIS E. LOVE, JR.
DIRECTOR & SECRETARY
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
575 FIFTH AVENUE, 39TH FLOOR
NEW YORK, NEW YORK 10017-2422
TELEPHONE: (212) 551-1905
(Name, address, including zip code and telephone number, including area code,
of agent for service)
------------------------------
WITH A COPY TO:
<TABLE>
<S> <C> <C>
KIMBERLEY GIRE DIANE CITRON, ESQ. CATHY M. KAPLAN, ESQ.
DIRECTOR MAYER, BROWN & PLATT BROWN & WOOD LLP
WESTPAC SECURITISATION MANAGEMENT 190 SOUTH LASALLE STREET One World Trade Center
PTY LIMITED CHICAGO, ILLINOIS 60603 New York, New York 10048
LEVEL 6, 60 MARTIN PLACE
SYDNEY, NSW 2000
AUSTRALIA
</TABLE>
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time on or after the effective date of the registration statement, as
determined by market conditions.
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / / ________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / ________
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / ________
If delivery of the prospectus is expected to be made pursuant to Rule 434
check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER UNIT* OFFERING PRICE* FEE
<S> <C> <C> <C> <C>
Mortgage Backed Floating Rate Notes......... $1,000,000 100% $1,000,000 $295.00**
</TABLE>
* Estimated for the purpose of calculating the registration fee.
** Previously filed.
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
CROSS REFERENCE SHEET
<TABLE>
<CAPTION>
NAME AND CAPTION IN FORM S-11 CAPTION IN PROSPECTUS
- ----------------------------------------------------------------- ------------------------------------------------------
<C> <S> <C>
1. Forepart of Registration Statement and Outside Front
Cover Page of Prospectus............................ Front Cover of Registration Statement; Outside Front
Cover Page of Prospectus
2. Inside Front and Outside Back Cover Pages of
Prospectus.......................................... Inside Front Cover Page of Prospectus; Outside Back
Cover Page of Prospectus
3. Summary Information, Risk Factors and Ratio of
Earnings to Fixed Charges........................... Summary of Terms; Risk Factors
4. Determination of Offering Price....................... *
5. Dilution.............................................. *
6. Selling Security Holders.............................. *
7. Plan of Distribution.................................. Underwriting
8. Use of Proceeds....................................... Use of Proceeds
9. Selected Financial Data............................... *
10. Management's Discussion and Analysis of Financial
Condition and Results of Operations................. The Trust Fund; The Trust Manager
11. General Information as to Registrant.................. Description of the Offered Notes; The Trust Manager
12. Policy with respect to Certain Activities............. Description of the Offered Notes
13. Investment Policies of Registrant..................... Description of the Offered Notes
14. Description of Real Estate............................ The Trust Fund; Westpac Residential Loan Program
15. Operating Data........................................ *
16. Tax Treatment of Registrant and Its Security
Holders............................................. United States Federal Income Tax Consequences; Certain
Australian Tax Matters
17. Market Price of and Dividends on the Registrant's
Common Equity and Related Stockholder Matters....... *
18. Description of Registrant's Securities................ Description of the Offered Notes
19. Legal Proceedings..................................... *
20. Security Ownership of Certain Beneficial Owners and
Management.......................................... The Trust Manager
21. Directors and Executive Officers...................... The Trust Manager
22. Executive Compensation................................ *
23. Certain Relationships and Related Transactions........ *
24. Selection, Management and Custody of Registrant's
Investments......................................... Description of the Offered Notes; Westpac Residential
Loan Program
25. Policies with Respect to Certain Transactions......... Description of the Offered Notes
26. Limitations of Liability.............................. Description of the Offered Notes
27. Financial Statements and Information.................. *
28. Interests of Named Experts and Counsel................ *
29. Disclosure of Commission Position on Indemnification
for Securities Act Liabilities...................... Part II of Registration Statement
30. Quantitative and Qualitative Disclosures about Market
Risk................................................ *
</TABLE>
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* Not Applicable
<PAGE>
SUBJECT TO COMPLETION, DATED MAY , 1998
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
PRELIMINARY PROSPECTUS
US$
WESTPAC SECURITIES ADMINISTRATION LIMITED
(ACN 000 049 472)
IN ITS CAPACITY AS TRUSTEE OF THE
SERIES 1998-1G WST TRUST
US$ CLASS A MORTGAGE BACKED FLOATING RATE NOTES DUE
US$ CLASS B MORTGAGE BACKED FLOATING RATE NOTES DUE
Interest on the Class A Mortgage Backed Floating Rate Notes (the "Class A
Notes") and the Class B Mortgage Backed Floating Rate Notes (the "Class B Notes"
and together with the Class A Notes, the "Offered Notes") offered hereby and
issued by Westpac Securities Administration Limited solely in its capacity as
trustee of the Series 1998-1G WST Trust (the "Trust") (the "Issuer Trustee")
will be payable quarterly on the 19th day of each of April, July, October and
January (or if such 19th day is not a Business Day (as defined herein), the next
succeeding Business Day in the same month or, if not in the same month, the
immediately preceding Business Day), commencing July 20, 1998 (each, a "Payment
Date"). The principal of a class of Offered Notes will be payable on its
maturity date indicated above, subject to earlier redemption in whole or in part
as described herein. Only the Offered Notes are offered hereby.
The Offered Notes will be collateralized by a pool of variable and fixed
rate residential housing loans secured by Mortgaged Properties (as defined
herein) located in Australia (the "Housing Loans") which are repayable in
Australian dollars, rights under certain insurance policies with respect to the
Housing Loans, amounts on deposit in certain accounts, amounts invested in
Authorized Investments (as defined herein) and the Issuer Trustee's rights under
the Transaction Documents (as defined herein) (collectively, the "Trust
Assets"). The Housing Loans are from a general portfolio of residential Housing
Loans which have been originated by Westpac Banking Corporation (ARBN 007 457
141) ("Westpac") in the ordinary course of its business. The Housing Loans will
be sold either by Westpac or the Seller Trustee (as defined herein) to the
Issuer Trustee. The Offered Notes and the Transaction Documents (other than the
Security Trust Deed) are governed by, and shall be construed in accordance with,
the laws of New South Wales, Australia. The Security Trust Deed (as defined
herein) is governed by, and shall be construed in accordance with, the laws of
the Australian Capital Territory.
(CONTINUED ON NEXT PAGE)
--------------------------
PROSPECTIVE INVESTORS IN THE NOTES SHOULD REVIEW THE INFORMATION SET FORTH
UNDER "RISK FACTORS" BEGINNING ON PAGE 34 HEREIN.
THE OFFERED NOTES REPRESENT OBLIGATIONS OF THE ISSUER TRUSTEE IN ITS CAPACITY AS
TRUSTEE OF THE TRUST ONLY AND DO NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF
WESTPAC, THE MORTGAGE COMPANY PTY LIMITED, WESTPAC SECURITISATION
MANAGEMENT PTY LIMITED, ANY OF THEIR RESPECTIVE AFFILIATES (OTHER THAN
THE ISSUER TRUSTEE) OR ANY GOVERNMENT OR GOVERNMENTAL AGENCY.
NEITHER THE OFFERED NOTES NOR THE HOUSING LOANS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENT OR GOVERNMENTAL AGENCY EXCEPT TO
THE LIMITED EXTENT DESCRIBED HEREIN.
THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
Proceeds to
Underwriting Issuer
Price to Public Discount Trustee(2)
<S> <C> <C> <C>
Class A Notes(1)................................... % % %
Class B Notes(1)................................... % % %
Total.............................................. US$ US$ US$
</TABLE>
(1) Plus accrued interest, if any, at the applicable rate from .
(2) Before deducting expenses, estimated to be US$ .
Application has been made to the London Stock Exchange Limited (the "London
Stock Exchange") for the Offered Notes to be admitted to the Official List.
Copies of this Prospectus and the Appendices, which comprise Listing Particulars
with regard to the Issuer Trustee and the Offered Notes in accordance with the
listing rules made under Part IV of the Financial Services Act of 1986, have
been delivered to the Registrar of Companies in England of Wales for
registration in accordance with Section 149 of that Act.
The Offered Notes are offered by the Underwriters (as defined herein)
subject to prior sale when, as and if issued to and accepted by them, subject to
approval of certain legal matters by counsel for the Underwriters. The
Underwriters reserve the right to reject any order in whole or in part and to
withdraw, cancel or modify the offer without notice. It is expected that
delivery of the Offered Notes will be made in book-entry form through the
facilities of The Depository Trust Company ("DTC"), Cedel Bank, SOCIETE ANONYME
("Cedel") and the Euroclear System ("Euroclear") on or about , against
payment therefor in immediately available funds.
J.P. MORGAN & CO. MORGAN STANLEY DEAN WITTER
J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated are acting
as joint bookrunners in connection with the activities relating to this
offering.
WESTPAC BANKING CORPORATION
The date of this Prospectus is May , 1998.
<PAGE>
(CONTINUED FROM THE COVER PAGE)
The Issuer Trustee was incorporated on 11th July 1944 as, and continues to
exist and operate as, a limited liability public company under the Corporations
Law of New South Wales, Australia. The Trust will be formed on or about
pursuant to the Notice of Creation of Trust (as defined herein) executed by the
Issuer Trustee and Westpac Securitisation Management Pty Limited (the "Trust
Manager"). The Issuer Trustee will issue the Offered Notes in its capacity as
trustee of the Trust.
The Offered Notes shall be subject to mandatory redemption in part on any
Payment Date if on that date there are any Principal Collections (as defined
herein) available to be distributed in relation to the Offered Notes. The
Offered Notes are also subject to optional redemption in full in certain
circumstances described herein.
The Class A Notes rank PARI PASSU and without any preference among
themselves and the Class B Notes rank PARI PASSU and without any preference
among themselves. The right to payment of principal of and interest on the Class
B Notes is subordinated and may be limited as more particularly described
herein. In addition, under certain limited circumstances, the Trust may issue
certain additional debt securities, the Redraw Funding Securities ("RFSs"),
which in certain circumstances will convert to RFS Class A Notes (the "RFS Class
A Notes"). Upon conversion, the RFS Class A Notes will rank PARI PASSU in
respect of priority of principal and interest with the Class A Notes. The RFSs,
along with repayments under the Redraw Facility (as defined herein), will be
senior in priority of distributions of principal to the Class A Notes and the
RFS Class A Notes. The RFSs, the RFS Class A Notes and fees with respect to the
Redraw Facility and the Class A Notes will rank PARI PASSU in respect to
priority of payments of interest. Payments in respect of principal and interest
in respect of the Class B Notes are subordinated to such payments in respect of
the Class A Notes, RFSs and RFS Class A Notes. See "DESCRIPTION OF THE OFFERED
NOTES--Description of the Redraw Facility, the Redraw Funding Securities and the
RFS Class A Notes," "--Interest Payable on the RFSs and the RFS Class A Notes"
and "--Subordination of the Class B Notes." The RFSs and the RFS Class A Notes
are not being offered hereby.
The Offered Notes should not be acquired by any associate (as defined in
Section 128F of the Income Tax Assessment Act of 1936 of Australia) of the
Issuer Trustee (which for these purposes, is Westpac and its associates).
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES.
SPECIFICALLY, THE UNDERWRITERS MAY OVERALLOT IN CONNECTION WITH THE OFFERING,
AND MAY BID FOR, AND PURCHASE, THE SECURITIES IN THE OPEN MARKET. SEE
"UNDERWRITING."
UNTIL 90 DAYS AFTER THE DATE OF THIS PROSPECTUS, ALL DEALERS EFFECTING
TRANSACTIONS IN THE OFFERED NOTES, WHETHER OR NOT PARTICIPATING IN THIS
DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO
THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS
AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
------------------------
ANNOUNCEMENT
By distributing or arranging for the distribution of this Prospectus to the
Underwriters and the persons to whom this Prospectus is distributed, the Issuer
Trustee announces to the Underwriters and each such person that: (1) the Offered
Notes will be issued in the form of one or more Notes issued to and lodged with
Cede & Co. as nominee of DTC; (2) in connection with the issue, DTC will confer
rights in relation to the Offered Notes and Noteholders and will record the
existence of those rights; and (3) as a result of the issue of the Offered Notes
in this manner, such rights will be able to be created.
2
<PAGE>
REPORTS TO NOTEHOLDERS
Unless and until Definitive Notes (as defined herein) are issued, quarterly
and annual unaudited reports containing information concerning the Trust and the
Offered Notes will be prepared by the Trust Manager and sent on behalf of the
Issuer Trustee to Cede & Co. ("Cede"), as nominee of DTC as registered holder of
the Offered Notes pursuant to the Note Trust Deed. See "DESCRIPTION OF THE
OFFERED NOTES--Book-Entry Registration" and "--Determination Date- Calculations
and Reports to Noteholders." Such reports will be made available by the Issuer
Trustee to DTC and its participants. DTC and its participants will make such
reports available to holders of interests in the Offered Notes in accordance
with the rules, regulations and procedures creating and affecting DTC. However,
such reports will not be sent directly to each beneficial owner while the
Offered Notes are in book-entry form. Upon the issuance of fully registered,
certificated Offered Notes, such reports will be sent directly to each
Noteholder. Such reports will not constitute financial statements prepared in
accordance with generally accepted accounting principles. The Trust Manager, on
behalf of the Issuer Trustee, will file with the Securities and Exchange
Commission (the "Commission") such periodic reports as are required under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules
and regulations of the Commission thereunder. However, in accordance with the
Exchange Act and the rules and regulations of the Commission thereunder, the
Trust Manager expects that the Issuer Trustee's obligation to file such reports
will be terminated following the end of 1998.
DISCLAIMERS WITH RESPECT TO LISTING ON LONDON STOCK EXCHANGE
This section applies only to the offer to subscribe for, or purchase, the
Offered Notes in any country outside the United States of America. The Issuer
Trustee's responsibility for, and liability in respect of, this Prospectus is
limited accordingly.
This Prospectus does not constitute an offer of, or an invitation by or on
behalf of, the Issuer Trustee or the Underwriters or any of them, to subscribe
for or purchase any of the Offered Notes, and must not be relied upon by anybody
intending to purchase the Offered Notes.
No action has been or will be taken by the Issuer Trustee or the
Underwriters that would permit a public offer of the Offered Notes in any
country or jurisdiction (other than in the United States of America) where
action for that purpose is required. Accordingly, the Offered Notes may not be
offered or sold, directly or indirectly, and neither this Prospectus nor any
offering circular, prospectus, form of application, advertisment or other
offering material may be issued or distributed or published in any country or
jurisdiction, except in circumstances that will result in compliance with all
applicable laws and regulations and the Underwriters have represented that all
offers and sales by them have been and will be made on such terms. Persons into
whose possession this document comes are required by the Issuer Trustee and the
Underwriters to inform themselves about and to observe any such restrictions.
[For a description of certain further restrictions on offers and sales of
Offered Notes and distribution of this document as to non-US beneficial
ownership, see "UNDERWRITING."]
The Issuer Trustee accepts responsibility for the information contained in
this Prospectus and the Appendices. To the best of the knowledge and belief of
the Issuer Trustee (which has taken all reasonable care to ensure that such is
the case), the information contained in this Prospectus is in accordance with
the facts and does not omit anything likely to affect the import of such
information.
The Currency Swap Providers (as defined herein) accept responsibility for
the information contained in "CURRENCY SWAP PROVIDERS" and "DESCRIPTION OF THE
SWAP AGREEMENTS-- Description of Currency Swap". To the best of the knowledge
and belief of the Currency Swap Providers (which have taken all reasonable care
to ensure that such is the case), such information is in accordance with the
facts and does not omit anything likely to affect the import of such
information. The Currency Swap Providers do not accept responsibility for any
other information contained in this Prospectus. Save for the above information,
the Currency Swap Providers have not separately verified the information
3
<PAGE>
contained herein. No representation, warranty or undertaking, express or
implied, is made and no responsibility or liability is accepted by the Currency
Swap Providers as to the accuracy or completeness of any of the information in
this Prospectus (other than the above information) or any other information
supplied in connection with the Offered Notes or their distribution.
None of the Seller Trustee, the Servicer, Westpac, the Security Trustee, the
Note Trustee or the Underwriters accepts any responsibility for any information
contained in this Prospectus and none of them has separately verified the
information contained herein. No representation, warranty or undertaking,
express or implied, is made and no responsibility or liability is accepted by
the Seller Trustee, the Servicer, the Trust Manager, Westpac, the Security
Trustee, the Note Trustee or the Underwriters as to the accuracy or completeness
of any information contained in this Prospectus or any other information
supplied in connection with the Offered Notes or their distribution. Each person
receiving this Prospectus acknowledges that such person has not relied on the
Seller Trustee, the Servicer, the Trust Manager, Westpac, the Security Trustee,
the Note Trustee or the Underwriters nor on any person affiliated with any of
them in connection with its investigation of the accuracy of such information or
its investment decisions.
No person has been authorised to give any information or to make any
representations other than those contained in this Prospectus and the documents
incorporated by reference herein in connection with the issue or sale of the
Offered Notes and, if given or made, such information or representation must not
be relied upon as having been authorised by the Issuer Trustee or any of the
Underwriters. Neither the delivery of this Prospectus nor any sale made in
connection herewith shall, under any circumstances, create any implication that
there has been no change in the affairs of the Issuer Trustee since the date
hereof or the date upon which this document has been most recently amended or
supplemented or that there has been no adverse change in the financial position
of the Issuer Trustee since the date hereof or the date upon which this document
has been most recently amended or supplemented or that any other information
supplied in connection with the Notes is correct as of any time subsequent to
the date on which it is supplied or, if different, the date indicated in the
document containing the same. The Underwriters expressly do not undertake to
review the financial condition or affairs of the Issuer Trustee during the life
of the Notes.
Neither this Prospectus nor any other information supplied in connection
with the Offered Notes is intended to provide the basis of any credit or other
evaluation and should not be considered as a recommendation by the Issuer
Trustee or any of the Underwriters that any receipt of this Prospectus, or any
other information supplied in connection with the Offered Notes, should purchase
any of the Offered Notes. Each investor contemplating purchasing any of the
Offered Notes should make its own independent investigation of the financial
condition and affairs, and its own appraisal of the creditworthiness of the
Issuer Trustee and each investor should seek its own tax, accounting and legal
advice as to the consequences of investing in any of the Offered Notes and none
of the Servicer, the Seller Trustee, Westpac, the Note Trustee, the Security
Trustee or any of the Underwriters accept any responsibility or make any
representation as to the tax consequences of investing in the Notes.
The Issuer Trustee's liability to make payments in respect of the Offered
Notes is limited to its right of indemnity from the assets of the Trust which
are from time to time available for this purpose pursuant to the Master Trust
Deed, the Series Notice and the Security Trust Deed. All claims against the
Issuer Trustee in relation to the Offered Notes may only be satisfied out of the
assets of the Trust, and are limited in recourse to the assets of the Trust.
Each Noteholder is required to accept any distribution of moneys under the
Security Trust Deed in full and final satisfaction of all moneys owing to it,
and any debt represented by any shortfall that exists after any such final
distribution is extinguished. The Issuer Trustee shall not be liable to satisfy
any obligations or liabilities in relation to the Offered Notes from its
personal assets except arising from (and to the extent of ) any fraud,
negligence or breach of trust on the part of the Issuer Trustee.
4
<PAGE>
AUSTRALIAN DISCLAIMERS
(a) The Offered Notes do not represent deposits or other liabilities of
Westpac or associates of Westpac.
(b) The holding of the Offered Notes is subject to investment risk,
including possible delays in repayment and loss of income and principal
invested.
(c) Neither Westpac nor any associate of Westpac in any way stands behind
the capital value and/or performance of the Offered Notes or the assets of the
Trust except to the limited extent provided in the Transaction Documents for the
Trust.
(d) None of Westpac, the Issuer Trustee, The Mortgage Company Pty Limited
(the "Servicer") or the Trust Manager guarantees the payment of interest or the
repayment of principal due on the Offered Notes.
(e) None of the obligations of the Trust Manager are guaranteed in any way
by Westpac or any associate of Westpac.
------------------------
5
<PAGE>
AVAILABLE INFORMATION
The Trust Manager has filed with the Commission a Registration Statement
(together with all amendments and exhibits thereto, referred to herein as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act") with respect to the Offered Notes offered pursuant to this
Prospectus. For further information, reference is made to the Registration
Statement and amendments thereof and to the exhibits thereto, which are
available for inspection without charge at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549;
and at the Commission's regional offices at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661, and 7 World Trade Center, Suite
1300, New York, New York 10048. Copies of the Registration Statement and
amendments thereof and exhibits thereto may be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The Commission also maintains a World Wide Web site
which provides on-line access to reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission at the address "http://www.sec.gov."
ENFORCEMENT OF FOREIGN JUDGMENTS IN AUSTRALIA
The Trust Manager is an Australian proprietary company incorporated with
limited liability under the Corporations Law. Any final and conclusive judgment
of any New York State or United States Federal Court sitting in the Borough of
Manhattan in the City of New York having jurisdiction recognized by the relevant
Australian jurisdiction in respect of an obligation of the Trust Manager in
respect of an Offered Note, which is for a fixed sum of money and which has not
been stayed or satisfied in full, would be enforceable by action against the
Trust Manager in the courts of the relevant Australian jurisdiction without a
re-examination of the merits of the issues determined by the proceedings in the
New York State or United States Federal Court, as applicable, unless: (a) the
proceedings in New York State or United States Federal Court, as applicable,
involved a denial of the principles of natural justice; (b) the judgment is
contrary to the public policy of the relevant Australian jurisdiction; (c) the
judgment was obtained by fraud or duress or was based on a clear mistake of
fact; (d) the judgment is a penal or revenue judgment; or (e) there has been a
prior judgment in another court between the same parties concerning the same
issues as are dealt with in the judgment of the New York State or United States
Federal Court, as applicable. A judgment by a court may be given in some cases
only in Australian dollars. The Trust Manager has expressly submitted to the
jurisdiction of New York State and United States Federal Courts sitting in the
Borough of Manhattan in the City of New York for the purpose of any suit, action
or proceedings arising out of this offering. The Trust Manager has appointed
Lewis E. Love, Jr., its Director and Secretary, 575 Fifth Avenue, 39th Floor,
New York, New York 10017-2422, as its agent upon whom process may be served in
any such action.
The majority of the directors and executive officers of the Trust Manager,
and certain experts named herein, reside outside the United States (in the
Commonwealth of Australia). Substantially all or a substantial portion of the
assets of all or many of such persons are located outside the United States. As
a result, it may not be possible for holders of the Offered Notes to effect
service of process within the United States upon such persons or to enforce
against them judgments obtained in United States courts predicated upon the
civil liability provisions of Federal securities laws of the United States. The
Trust Manager has been advised by its Australian counsel Allen Allen & Hemsley,
that, based on the restrictions referred to above, there is doubt as to the
enforceability in the Commonwealth of Australia, in original actions or in
actions for enforcement of judgments of United States courts, of civil
liabilities predicated upon the Federal securities laws of the United States.
EXCHANGE CONTROLS AND LIMITATIONS
Under temporary Australian foreign exchange controls, payments by an
Australian resident to, or on behalf of: (a) the Government of Iraq or its
agencies or nationals; (b) the authorities of the Federal
6
<PAGE>
Republic of Yugoslavia (Serbia and Montenegro); or (c) the Government of Libya
or any public authority or controlled entity of the Government of Libya may only
be made with Reserve Bank of Australia approval. Such restrictions may change in
the future. See "RISK FACTORS--Risks of Currency Exchange Controls."
U.S. DOLLAR PRESENTATION
In this Prospectus, references to "U.S. dollars" and "US$" are references to
U.S. currency and references to "Australian dollars" and "A$" are references to
Australian currency. Unless otherwise stated herein, the translations of
Australian dollars into U.S. dollars have been made at a rate of US$[ ]=A$1.00,
the noon buying rate in New York City for cable transfers in Australian dollars
as certified for customs purposes by the Federal Reserve Bank of New York on
, 1998. Use of such rate is not a representation that Australian dollar
amounts actually represent such U.S. dollar amounts or could be converted into
U.S. dollars at that rate.
7
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SUMMARY OF TERMS.......................................................................................... 13
STRUCTURAL CHART.......................................................................................... 28
CASH FLOW SUMMARY......................................................................................... 29
Collections........................................................................................... 29
Gross Principal Collections........................................................................... 29
Principal Losses...................................................................................... 30
Income Collections.................................................................................... 30
Liquidity Support..................................................................................... 31
Currency Swap......................................................................................... 31
CASH FLOW CHART........................................................................................... 32
RISK FACTORS.............................................................................................. 34
Limited Liability under the Offered Notes............................................................. 34
Risk of Equitable Assignment of Housing Loans Rather Than Legal Assignment............................ 34
Risk of Losses and Delays from Enforcement of the Housing Loans....................................... 35
Mortgage Insurance Policies Are Subject to Exclusions and Limitations................................. 35
Risks Associated with High LVR Housing Loans.......................................................... 35
Risks Associated with Westpac's Ability to Set Rates on Variable
Rate Housing Loans at its Discretion................................................................ 35
Ability to Change Housing Loan Features may Result in Changes to the Mortgage Pool and Higher Rates of
Principal Prepayment on the Offered Notes............................................................ 36
Risks of Currency Exchange Controls................................................................... 36
Risks Related to a Termination of the Swap Agreements................................................. 36
Delinquency and Default Risk.......................................................................... 38
Risk of Early Defaults................................................................................ 38
Principal Payment and Yield Considerations............................................................ 38
Reinvestment Risk..................................................................................... 39
Servicer Risk......................................................................................... 39
Priority of RFSs and RFS Class A Notes Owned by Australian Resident Investors......................... 40
Credit Enhancement Provides Only Limited Protection Against Losses.................................... 40
Limitations on the Liquidity Support.................................................................. 40
Exercise of Clean-up Offer may result in Shortfalls to Noteholders.................................... 40
Redemption of the Notes............................................................................... 41
Geographic Concentration May Affect Performance....................................................... 41
Consumer Credit Legislation........................................................................... 41
Risk of Commingling................................................................................... 42
Limited Liquidity..................................................................................... 42
Ratings of the Notes; Factors Affecting Ability to Maintain Ratings................................... 42
Book-Entry Notes...................................................................................... 43
Other Considerations.................................................................................. 43
FORMATION OF THE TRUST.................................................................................... 43
Westpac Securitisation Trust Programme................................................................ 43
Series 1998-1G WST Trust.............................................................................. 44
Trust Assets.......................................................................................... 44
SECURITY FOR THE NOTES.................................................................................... 44
Charge................................................................................................ 44
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Security Trustee...................................................................................... 45
Nature of Security.................................................................................... 45
Enforcement........................................................................................... 46
Priorities under the Security Trust Deed.............................................................. 47
Security Trustee's Fees and Expenses.................................................................. 48
Retirement and Removal................................................................................ 48
Additional Provisions of the Security Trust Deed...................................................... 49
THE TRUST FUND............................................................................................ 50
General............................................................................................... 50
Transfer and Assignment of Housing Loans.............................................................. 50
Representations and Warranties........................................................................ 51
Westpac Representations............................................................................... 51
Servicer Representations.............................................................................. 52
Seller Trustee Representations........................................................................ 52
General............................................................................................... 52
Breach of Representations and Warranties.............................................................. 52
Housing Loan Statistics............................................................................... 53
THE ISSUER TRUSTEE........................................................................................ 59
Incorporation......................................................................................... 59
Share Capital......................................................................................... 59
Business.............................................................................................. 59
Experience............................................................................................ 60
Directors............................................................................................. 60
Powers................................................................................................ 60
Duties................................................................................................ 60
Delegation............................................................................................ 62
Issuer Trustee Fees and Expenses...................................................................... 62
Removal of the Issuer Trustee......................................................................... 62
Voluntary Retirement of the Issuer Trustee............................................................ 63
Limitation of Issuer Trustee's Liability.............................................................. 63
Rights of Indemnity of Issuer Trustee................................................................. 63
Limitation of Seller Trustee's Liability and Rights of Indemnity...................................... 63
Rights of Indemnity of Seller Trustee................................................................. 64
ORIGINATOR OF THE HOUSING LOANS........................................................................... 64
Year 2000............................................................................................. 64
THE SERVICER.............................................................................................. 65
General............................................................................................... 65
Servicing of Housing Loans............................................................................ 65
Document Custody...................................................................................... 65
Collection and Enforcement Procedures................................................................. 65
Delinquencies and Mortgagee in Possession with respect to the Securitized Portfolios.................. 66
THE TRUST MANAGER......................................................................................... 69
General............................................................................................... 69
Incorporation......................................................................................... 69
Share Capital......................................................................................... 69
Business.............................................................................................. 69
Directors............................................................................................. 69
Duties and Role of the Trust Manager.................................................................. 70
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Delegation............................................................................................ 70
Trust Manager's Fees and Expenses..................................................................... 70
Removal of the Trust Manager.......................................................................... 70
Voluntary Retirement of the Trust Manager............................................................. 71
Limitation of Trust Manager's Liability............................................................... 71
WESTPAC RESIDENTIAL LOAN PROGRAM.......................................................................... 71
Origination of Housing Loans.......................................................................... 71
Underwriting of Housing Loans......................................................................... 72
Servicing of Housing Loans............................................................................ 73
Housing Loan Products................................................................................. 73
Housing Loan Features..................................................................................... 74
THE MORTGAGE INSURANCE POLICIES........................................................................... 76
Mortgage Insurance Policies--General.................................................................. 76
The HLIC Mortgage Pool Insurance Policy............................................................... 76
Primary Mortgage Insurance Policies................................................................... 81
PRINCIPAL PAYMENT AND YIELD CONSIDERATIONS................................................................ 82
General............................................................................................... 82
Principal Payments.................................................................................... 83
Weighted Average Lives................................................................................ 83
DESCRIPTION OF THE OFFERED NOTES.......................................................................... 85
General............................................................................................... 85
Collections and Payment............................................................................... 86
Collections........................................................................................... 86
Calculation of Total Available Funds.................................................................. 87
Available Income...................................................................................... 87
Principal Draws....................................................................................... 89
Liquidity Draws....................................................................................... 89
Remaining Liquidity Shortfall......................................................................... 89
Distribution of Total Available Funds................................................................. 90
Excess Available Income............................................................................... 92
Gross Principal Collections........................................................................... 93
Principal Collections................................................................................. 94
Distribution of Principal Collections................................................................. 94
Payments of Principal on the Notes.................................................................... 95
Application of Principal Charge Offs.................................................................. 98
Payments into US$ Account............................................................................. 99
Payments out of US$ Account........................................................................... 100
Prepayment Costs and Prepayment Benefits.............................................................. 100
Description of the Redraw Facility, the Redraw Funding Securities and the RFS Class A Notes........... 100
Redraw Facility....................................................................................... 100
Issuance of Redraw Funding Securities ("RFS")......................................................... 104
RFS Class A Notes..................................................................................... 104
Form of the RFSs and the RFS Class A Notes............................................................ 105
Interest Payable on the RFSs and the RFS Class A Notes................................................ 105
Subordination of Class B Notes; Priority of Principal Payments to RFSs................................ 105
Substitution of Housing Loans......................................................................... 105
Prescription.......................................................................................... 106
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Clean-up Offer........................................................................................ 106
Redemption of the Notes............................................................................... 106
Withholding or Tax Deductions......................................................................... 107
Redemption of the Offered Notes for Taxation or Other Reasons......................................... 107
Termination of the Trust.............................................................................. 107
Trust Accounts........................................................................................ 108
General............................................................................................... 109
Determination Date--Calculations and Reports to Noteholders........................................... 109
Book-Entry Registration............................................................................... 110
Definitive Notes...................................................................................... 113
Modification of Master Trust Deed Without Noteholder Consent.......................................... 114
Modification of Master Trust Deed With Noteholder Consent............................................. 115
Meetings of Voting Mortgagees and Meetings of Class A Noteholders; Modification; Consents; Waiver..... 115
Meetings of Voting Mortgagees and Meetings of Class B Noteholders; Modifications; Consents; Waiver.... 116
Events of Default; Rights Upon Event of Default....................................................... 117
Enforcement........................................................................................... 118
Certain Covenants..................................................................................... 121
The Note Trustee...................................................................................... 122
Governing Law......................................................................................... 122
DESCRIPTION OF THE SERVICING AGREEMENT.................................................................... 122
General............................................................................................... 122
Servicing............................................................................................. 122
Document Custody...................................................................................... 127
Amendment............................................................................................. 127
Termination of Servicing Agreement.................................................................... 127
THE LIQUIDITY FACILITY.................................................................................... 128
General Description................................................................................... 128
Liquidity Draws....................................................................................... 128
Conditions Precedent to a Liquidity Draw.............................................................. 128
Deposit into a Collateral Account..................................................................... 129
Interest on Liquidity Draws........................................................................... 129
Commitment Fee........................................................................................ 129
Repayment of Liquidity Drawings....................................................................... 129
Events of Default..................................................................................... 130
Consequences of Default............................................................................... 130
Termination........................................................................................... 130
DESCRIPTION OF THE SWAP AGREEMENTS........................................................................ 131
Description of Interest Rate Swap Agreements.......................................................... 131
Description of Currency Swap.......................................................................... 132
Replacement of Currency Swap.......................................................................... 135
Downgrade of Currency Swap Providers.................................................................. 135
CURRENCY SWAP PROVIDERS................................................................................... 135
CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS................................................................ 136
General............................................................................................... 136
Nature of Housing Loans as Security................................................................... 136
Enforcement of Housing Loans.......................................................................... 138
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Penalties and Prohibited Fees......................................................................... 138
Consumer Credit Legislation........................................................................... 139
Bankruptcy............................................................................................ 140
Environmental......................................................................................... 140
Insolvency Considerations............................................................................. 140
Treatment of Interest Payments with respect to Australian Housing Loans............................... 141
USE OF PROCEEDS........................................................................................... 141
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES............................................................. 141
General............................................................................................... 141
Sales of Notes........................................................................................ 142
Market Discount....................................................................................... 142
Premium............................................................................................... 143
Backup Withholding.................................................................................... 143
CERTAIN AUSTRALIAN TAX MATTERS............................................................................ 143
Payments of Principal, Premiums and Interest.......................................................... 144
Profit on Sale........................................................................................ 144
Other Taxes........................................................................................... 145
ERISA CONSIDERATIONS...................................................................................... 145
RATINGS OF THE NOTES...................................................................................... 146
LEGAL INVESTMENT CONSIDERATIONS........................................................................... 146
UNDERWRITING.............................................................................................. 146
LISTING AND GENERAL INFORMATION FOR NON-U.S. INVESTORS.................................................... 147
Listing............................................................................................... 147
Authorization......................................................................................... 147
Litigation............................................................................................ 147
Euroclear and Cedel................................................................................... 147
Documents Available for Collection and Inspection..................................................... 147
Temporary Australian Foreign Exchange Controls........................................................ 148
LEGAL MATTERS............................................................................................. 149
INDEX OF DEFINED TERMS.................................................................................... 150
APPENDIX I--GLOSSARY OF AUSTRALIAN LEGAL TERMS............................................................ I-1
APPENDIX II--TERMS AND CONDITIONS OF THE CLASS A NOTES.................................................... I-2
APPENDIX III--TERMS AND CONDITIONS OF THE CLASS B NOTES................................................... I-3
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SUMMARY OF TERMS
This Summary of Terms is qualified in its entirety by reference to the
detailed information appearing elsewhere in this Prospectus. Certain capitalized
terms used in this Summary of Terms are defined elsewhere in this Prospectus on
the pages indicated "Index of Defined Terms."
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Issuer Trustee.................. Westpac Securities Administration Limited (ACN 000 049
472), a limited liability public company under the
Corporations Law of New South Wales, Australia, a wholly
owned, indirect subsidiary of Westpac Banking Corporation,
in its capacity as trustee of the Series 1998-1G WST Trust
(the "Trust") (the "Issuer Trustee") will issue the
Offered Notes.
Approved Seller................. Either Westpac Banking Corporation (ARBN 007 457 141)
("Westpac"), a corporation organized under the laws of New
South Wales in the Commonwealth of Australia, in its
capacity as seller under a notice of sale (the "Sale
Notice") between Westpac and the Issuer Trustee or the
Seller Trustee as defined herein) under a Sale Notice
between the Seller Trustee and the Issuer Trustee. Westpac
and Westpac Securities Administration Limited, in its
capacity as Seller Trustee, are referred to herein as
"Approved Sellers."
Servicer........................ The Mortgage Company Pty Limited (ACN 070 968 302) (the
"Servicer" or "TMC"), a wholly owned indirect subsidiary
of Westpac, in its capacity as servicer under the
Servicing Agreement among Westpac, the Servicer and the
Issuer Trustee dated February 18, 1997, as amended from
time to time (the "Servicing Agreement").
Trust Manager and Registrant.... Westpac Securitisation Management Pty Limited (ACN 081 709
211) (the "Trust Manager"), a wholly owned indirect
subsidiary of Westpac, in its capacity as trust manager
under the Master Trust Deed, dated February 14, 1997 (the
"Master Trust Deed"), as amended by the Series Notice (as
defined herein), among the Issuer Trustee and the Trust
Manager dated on or about the Closing Date. See "FORMATION
OF THE TRUST."
Note Trustee.................... Morgan Guaranty Trust Company of New York (the "Note
Trustee"), a , in its capacity as note trustee under
the Note Trust Deed among the Issuer Trustee, the Trust
Manager and the Note Trustee dated , 1998, as
amended from time to time (the "Note Trust Deed").
[Citibank, N.A. of 47-49 Tooley Street, London, is in the
process of finalizing the purchase of the Global Trust and
Agency Services group of Morgan Guaranty Trust Company of
New York. It expects to finalize its acquisition in June,
1998.]
Security Trustee................ Perpetual Trustee Company Limited (ACN 000 001 007) (the
"Security Trustee"), a company within the Perpetual group
with its holding company being Perpetual Trustees
Australia Limited (ACN 000 431 827), in its capacity as
security trustee under the Security Trust Deed among the
Issuer Trustee, the Trust Manager, the Note Trustee and
the Security Trustee dated , 1998, as amended from
time to time (the "Security Trust Deed").
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Seller Trustee.................. Westpac Securities Administration Limited in its capacity
as trustee of any other WST trust established under the
Master Trust Deed (in that capacity, the "Seller
Trustee"). The Seller Trustee may sell housing loans
relating to such other trusts to the Trust and may
repurchase the Housing Loans relating to the Trust upon
the exercise of the Clean-up Offer (as defined herein).
Paying Agents................... Morgan Guaranty Trust Company of New York will act as the
principal paying agent ("Principal Paying Agent") and
Morgan Guaranty Trust Company of New York, 60 Victoria
Embankment, London, EC4Y OJP, will act as a paying agent
(the "Paying Agent" and together with the Principal Paying
Agent, the "Paying Agents").
Roles of the Security Trustee
and Note Trustee.............. The structure of the Series 1998-1G WST Trust transaction
employs several different trustees. The Security Trustee
is the entity that holds a security interest over the
assets of the Trust and has the responsibility of securing
such assets and distributing the proceeds received upon
the liquidation of such assets upon the occurrence of a
default and enforcement of the security interest. The Note
Trustee is the entity which represents the interest of the
Noteholders. The provisions of the Security Trust Deed
require the Security Trustee to consult with, and obtain
the consent of, the Note Trustee before taking certain
actions. Thus, not only does the Security Trustee owe
fiduciary duties to the Note Trustee (and the Offered
Noteholders and the other secured creditors), it has
contractual obligations to consult and act at the Note
Trustee's direction in accordance with the Security Trust
Deed. The Note Trustee owes fiduciary duties to the
Offered Noteholders and must act in accordance with those
duties when directing the Security Trustee to act or not
to act. The roles of the Note Trustee and the Security
Trustee together approximate the role of an Indenture
Trustee in a United States transaction.
Securities Offered.............. The Issuer Trustee, in its capacity as trustee of the
Series 1998-1G WST Trust, which was formed under
Australian law, will issue and hereby offer the following
Mortgage Backed Floating Rate Notes:
Class A Mortgage Backed Floating Rate Notes due in
the aggregate principal amount of US$ (the "Class A
Notes").
Class B Mortgage Backed Floating Rate Notes due in
the aggregate principal amount of US$ (the "Class B
Notes").
The Class A Notes and the Class B Notes are collectively
referred to herein as the "Offered Notes."
Redraws, RFSs and RFS Class A
Notes......................... Certain Housing Loans provide the relevant Borrower (as
defined herein) with the ability to "reborrow" from
Westpac amounts that have been previously paid by the
Borrower which are in excess of scheduled repayments
required under the contractual amortization schedule for
the relevant Housing Loan. Amounts drawn by Borrowers on
principal repayments made in excess of scheduled
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payments are called "redraws". Westpac is entitled to be
reimbursed by the Issuer Trustee for such redraws from
Gross Principal Collections (as defined herein) and from
Principal Collections (as defined herein) prior to any
payments to the Offered Notes from such Collections.
On or before the Closing Date, Westpac as provider of the
Redraw Facility (as defined herein) will enter into a
Redraw Facility Agreement (as defined herein). If Gross
Principal Collections for a period are insufficient to
fund a redraw provided to a Borrower by Westpac, drawings
will be made under the Redraw Facility Agreement to fund
the redraw (up to the limit set out in the Redraw Facility
Agreement).
If there are insufficient amounts available under the
Redraw Facility Agreement to fund redraws the Trust
Manager may direct the Issuer Trustee to issue additional
debt securities known as "Redraw Funding Securities" or
"RFSs". The RFSs and payments under the Redraw Facility
will be senior in priority of distributions of principal
to the Class A Notes and RFS Class A Notes (as defined
herein). Interest on the RFSs, RFS Class A Notes and Class
A Notes and fees with respect to the Redraw Facility will
rank PARI PASSU in respect in priority.
If any RFSs remain outstanding for a period of five or
more Collection Periods (as defined herein), they shall
convert into RFS Class A Notes (the "RFS Class A Notes"),
the holders of which will rank PARI PASSU with the Class A
Notes as to the payment of interest and principal and have
certain rights of payment senior to those rights of
holders of the Class B Notes. The RFSs, RFS Class A Notes
and the Offered Notes are referred to herein as the
"Notes."
The RFSs and RFS Class A Notes, if issued, will be
denominated in Australian dollars and issued in Australia
to Australian residents only. The RFSs and RFS Class A
Notes will be in book-entry form and will not be
registered with the Securities and Exchange Commission in
the United States and will not be registered with the
relevant companies authority in Australia. The RFSs and
RFS Class A Notes are not offered hereby.
For a description of the RFSs, the RFS Class A Notes and
the priority of their payment, see "Priority of
Distribution with respect to the Offered Notes, RFSs and
RFS Class A Notes" herein and "DESCRIPTION OF THE OFFERED
NOTES--Description of the Redraw Facility, Redraw Funding
Securities and the RFS Class A Notes," "--Interest Payable
on the RFSs and the RFS Class A Notes" and
"--Subordination of the Class B Notes; Priority of
Principal Payments to RFSs" herein.
Cut-Off Date.................... [ ], 1998 (the "Cut-Off Date").
Closing Date.................... [ ], 1998 (the "Closing Date").
Maturity Date................... [ ], 2029 (the "Maturity Date").
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Terms of the Offered Notes
General....................... Payments of interest and principal on each class ("Class")
of Offered Notes will be made quarterly on the 19th day of
each of April, July, October and January (or if such 19th
day is not a Business Day, the next succeeding Business
Day in the same month or, if not in the same month, the
immediately preceding Business Day), commencing on July
20, 1998 (each such date, a "Payment Date").
As used in this Prospectus, "Business Day" means any day,
other than a Saturday, Sunday or public holiday, on which
banks in Sydney, London, New York City, the city in which
the corporate trust office of the paying agent is located
and the city in which the office of the Swap Providers are
open. If a public holiday is occurring in any of the
referenced locales, then such day is not a Business Day,
and no scheduled payments will be made on such day.
Payments of interest and principal will be made to the
holders of the Offered Notes (the "Offered Noteholders")
of record as of the day which is two Business Days
preceding the Payment Date (so long as the Offered Notes
are held in book-entry form) or the last day of the prior
calendar month (if Definitive Notes have been issued)
(such day, the "Record Date"). Each Offered Note bears
interest on its Invested Amount. The "Invested Amount" of
an Offered Note is equal to the Initial Invested Amount
(as defined herein) of such Offered Note less all payments
previously made in respect of principal in respect of such
Offered Note. The "Initial Invested Amount" of a Class of
Notes is its principal balance on the date of its
issuance. Each "Interest Period" (other than the initial
Interest Period and the final Interest Period) with
respect to the Offered Notes commences on (and includes) a
Payment Date and ends on (but excludes) the next Payment
Date. The initial Interest Period with respect to the
Offered Notes commences on (and includes) the Closing Date
and ends on (but excludes) the first Payment Date. The
final Interest Period ends on (but excludes) the Maturity
Date.
The "Interest Rate" for the Class A Notes for a particular
Interest Period is equal to USD-LIBOR-BBA on the related
Interest Determination Date (as defined herein) plus %.
The "Interest Rate" for the Class B Notes for a particular
Interest Period is equal to USD-LIBOR-BBA on the related
Interest Determination Date plus %. The Interest Rate
on the Class A Notes for the first Interest Period is
. The Interest Rate on the Class B Notes for the
first Interest Period is . See "DESCRIPTION OF THE
OFFERED NOTES--Calculation of USD-LIBOR-BBA" herein.
On the second London banking day before the beginning of
each Interest Period (each an "Interest Determination
Date"), (the "Agent Bank") will determine the rate
"USD-LIBOR-BBA" as the applicable Floating Rate Option
under the Definitions of the
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International Swaps and Derivatives Association, Inc.
("ISDA") (the "ISDA Definitions") being the rate
applicable to any Interest Period for three-month deposits
in U.S. dollars which appears on the Telerate Page 3750 as
of 11:00 A.M., London time, on the Interest Determination
Date. If such rate does not appear on the Telerate Page
3750, the rate for that Interest Period will be determined
as if the Issuer Trustee and Agent Bank had specified
"USD-LIBOR-Reference Banks" as the applicable Floating
Rate Option under the ISDA Definitions.
"USD-LIBOR-Reference Banks" means that the rate for an
Interest Period will be determined on the basis of the
rates at which deposits in U.S. Dollars are offered by the
Reference Banks (being four major banks in the London
interbank market) at approximately 11:00 A.M., London
time, on the Interest Determination Date to prime banks in
the London interbank market for a period of three months
commencing on the first day of the Interest Period and in
a Representative Amount (as defined in the ISDA
Definitions). The Agent Bank will request the principal
London office of each of the Reference Banks to provide a
quotation of its rate. If at least two such quotations are
provided, the rate for that Interest Period will be the
arithmetic mean of the quotations. If fewer than two
quotations are provided as requested, the rate for that
Interest Period will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the
Agent Bank, at approximately 11:00 A.M., New York City
time, on that Interest Determination Date for loans in
U.S. dollars to leading European banks for a period of
three months commencing on the first day of the Interest
Period and in a Representative Amount, provided that on
the first day of the first Interest Period USD-LIBOR-BBA
shall be an interpolated rate calculated with reference to
the period from (and including) the Closing Date to (but
excluding) the first Payment Date.
With respect to any Payment Date, interest on a Class of
Notes will be calculated as the product of (a) the
Invested Amount of such Class as of the first day of that
Interest Period after giving effect to any payments of
principal to be made thereon, (b) the Interest Rate for
such Class for the related Interest Period; and (c) a
fraction, the numerator of which is the actual number of
days in that Interest Period and the denominator of which
is 360 days (such product with respect to a Payment Date,
"Interest"); provided, however, that once the Stated
Amount of such Class has been reduced to zero, the related
Class will no longer accrue interest because the related
Class will have been redeemed pursuant to the terms of the
Transaction Documents. The "Stated Amount" of a Note is
the Invested Amount of the Note less the Carryover Charge
Offs (as defined herein) applied against it.
If Total Available Funds (as defined herein) available
after payment of any Accrued Interest Adjustment (as
defined herein), interest or fees payable under the
Liquidity Facility (as defined herein), Trust Expenses (as
defined herein) and certain amounts
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payable to any Swap Provider (as defined herein) are
sufficient to pay Interest on each Class of Offered Notes,
Interest will be payable in arrears on each Payment Date
to each Class of Offered Notes in respect of the Interest
Period ending on that Payment Date. If Total Available
Funds are available on a Payment Date for the payment of
Interest on the Offered Notes, failure to pay such
Interest within 10 Business Days of the date such payment
is due will be an event of default under the Security
Trust Deed.
If Total Available Funds available after payment of Trust
Expenses and certain amounts payable under any Fixed Rate
and Variable Rate Basis Swaps are insufficient to pay full
Interest on all Classes of Notes for an Interest Period,
Total Available Funds available for the payment of
Interest on the Notes on the Payment Date will be paid in
the following order of priority either through a direct
payment in Australian dollars with respect to the RFSs,
the RFS Class A Notes or any payment in respect of the
Redraw Facility (as defined herein) or through a payment
to the Currency Swap Providers (as defined herein) with
respect to the Offered Notes:
(i) PRO RATA, to the Class A Notes, RFS Class A Notes (if
any), RFSs (if any) and any fee or outstanding amount
payable under the Redraw Facility, based on their related
interest or income entitlements, as the case may be; and
(ii) any remaining Total Available Funds, to the Class B
Notes.
See "DESCRIPTION OF THE OFFERED NOTES" herein.
Principal....................... On each Payment Date, Gross Principal Collections (as
described herein) will be used first to reimburse Westpac
for any Redraws (as defined herein) funded by Westpac
during the related Collection Period. See "WESTPAC
RESIDENTIAL LOAN PROGRAM-- Housing Loan Features--Redraw."
Any amount of Gross Principal Collections remaining after
such reimbursement will be distributed in the following
order of priority:
(i) to Westpac as reimbursement for any outstanding
Redraws, to the extent not otherwise reimbursed;
(ii) to Westpac, in its capacity as the provider of the
Redraw Facility Agreement (the "Redraw Facility
Provider"), to repay any Principal Outstanding (as defined
herein) under the Redraw Facility Agreement;
(iii) to fund any Principal Draw for such Payment Date;
and
(iv) to any holder of an RFS, in chronological order of
issuance, until each such RFS is repaid in full.
Any amount of Gross Principal Collections remaining after
the distributions described in clauses (i) through (iv)
above will be referred to herein as "Net Principal
Collections." On any Payment Date, Net Principal
Collections will be available to pay any RFS Class A
Noteholder and the Currency Swap Providers to enable the
Issuer Trustee to make payments to the Class A Noteholders
and Class B Noteholders in the amounts and priorities set
forth herein under "DESCRIPTION OF THE OFFERED
NOTES--Payments of Principal on the Notes."
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Priority of Distribution with
respect to the Offered Notes,
RFSs and RFS Class A Notes.... The Class A Notes rank PARI PASSU and without any
preference among themselves and the Class B Notes rank
PARI PASSU and without any preference among themselves.
The right to payment of principal of and interest on the
Class B Notes is subordinated and may be limited as more
particularly described herein. In addition, under certain
limited circumstances, the Trust may issue RFSs, which in
certain circumstances will convert to RFS Class A Notes.
Upon conversion, the RFS Class A Notes will rank PARI
PASSU in respect of priority of payment of principal and
interest with the Class A Notes. The RFSs and any
repayments under the Redraw Facility will be senior to the
Class A Notes and the RFS Class A Notes in priority of
distributions of principal. Interest on the RFSs, the RFS
Class A Notes and the Class A Notes and fees with respect
to the Redraw Facility will rank PARI PASSU in respect of
priority. Payments of principal and interest in respect of
the Class B Notes are subordinated to the extent set forth
herein to such payments in respect of Class A Notes, RFSs
and RFS Class A Notes. See "RISK FACTORS--Priority of RFSs
and RFS Class A Notes Owned by Australian Resident
Investors" and "DESCRIPTION OF THE OFFERED
NOTES--Description of the Redraw Facility, the Redraw
Funding Securities and the RFS Class A Notes," "--Interest
Payable on the RFSs and the RFS Class A Notes" and
"--Subordination of the Class B Notes; Priority of
Principal Payments to RFSs."
Credit Enhancement.............. Credit enhancement with respect to the Class A Notes will
be provided by (i) the Mortgage Insurance Policies, (ii)
subordination of the Excess Available Income (as defined
herein) and (iii) the subordination of payments of the
Class B Notes to payments to the Class A Notes. Credit
enhancement with respect to the Class B Notes will be
provided by (i) the Mortgage Insurance Policies and (ii)
subordination of the Excess Available Income.
A. Mortgage Insurance
Policies.................... On or before the Closing Date, a mortgage pool insurance
policy (the "Mortgage Pool Insurance Policy") will be
provided by Housing Loans Insurance Corporation Limited
(ACN 071 466 344) of 31 Market Street, Sydney NSW 2000,
Australia ("HLIC") to the Issuer Trustee to cover losses
in respect of each Housing Loan that is not subject to a
primary mortgage insurance policy (a "PMI Policy" and,
together with the Mortgage Pool Insurance Policy, the
"Mortgage Insurance Policies"). The Mortgage Pool
Insurance Policy generally applies to loans with a Loan to
Value Ratio ("LVR") of 80% or less at the Cut-Off Date.
The Mortgage Pool Insurance Policy will cover losses up to
a maximum aggregate amount of A$ . HLIC is a private
insurance company which is a subsidiary of GE Capital
Australia.
For a description of HLIC, see "THE MORTGAGE INSURANCE
POLICIES--The HLIC Mortgage Pool Insurance Policy."
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Each Housing Loan with an LVR of greater than 80% at the
time of origination (or a lower LVR where required by
Westpac's standard credit policy) will have been insured
under a PMI Policy issued by one of the following: Royal
and SunAlliance Lenders Mortgage Insurance Limited (ACN
001 825 725) of Level 9, 465 Victoria Avenue, Chatswood
NSW ("SunAlliance"), MGICA Limited (ACN 000 511 017) of
Level 23 AMP Centre, 50 Bridge Street, Sydney NSW
("MGICA"), Westpac Lenders Mortgage Insurance Limited (ACN
074 042 934) of Level 11, 50 Pitt Street, Sydney NSW
("WLMI") or HLIC. Approximately % of the Housing Loans
are subject to a PMI Policy. Each Approved Seller will
equitably assign its interest in each PMI Policy to the
Issuer Trustee on the Closing Date.
These Mortgage Insurance Policies are intended to enhance
the likelihood of regular receipt by the holders of the
Notes of the full amount of interest and principal
payments due to such holders and to provide holders of the
Notes limited protection against losses on the Housing
Loans. See "THE MORTGAGE INSURANCE POLICIES" herein.
HLIC, SunAlliance, MGICA and WLMI are referred to herein
as "Mortgage Insurers."
B. Subordination of Excess
Available Income.......... On each Payment Date, Excess Available Income will be
applied either in reduction of any current or outstanding
Principal Charge Offs (as defined herein) or as repayment
of any unrepaid Principal Draws on such Payment Date. The
application of such amounts, if any, will reduce the
likelihood of the Offered Noteholders receiving less than
their Initial Invested Amount on or prior to the Maturity
Date.
C. Subordination of
Class B Notes............. The rights of the holders of the Class B Notes to receive
payments of Interest on each Payment Date will be
subordinated to such rights of the holders of the RFSs (if
any), Class A Notes, RFS Class A Notes (if any) and the
Redraw Facility Provider to the extent set forth herein.
In addition, the rights of the holders of the Class B
Notes to receive distributions of principal on each
Payment Date generally will be subordinated to such rights
of the holders of the RFSs (if any) and the Redraw
Facility Provider with respect to repayments pursuant to
the Redraw Facility Agreement and to the holders of the
Class A Notes and RFS Class A Notes (if any). For a
description of the priority among the RFSs, Class A Notes,
RFS Class A Notes and the Redraw Facility Provider, see
"Priority of Distribution with respect to the Offered
Notes, RFSs and RFS Class A Notes" herein. Further, any
Principal Charge Offs will be applied first in reduction
of the principal balance of the Class B Notes. The
subordination described above is intended to enhance the
likelihood of regular receipt by the holders of the Class
A Notes of the full amount of interest and principal
payments due to such Noteholders and to afford such
holders protection against
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losses on the Housing Loans. See "DESCRIPTION OF THE
OFFERED NOTES--Collections and Payment" herein.
Security for the Offered Notes
General....................... The Offered Notes are debt obligations of the Issuer
Trustee in its capacity as trustee of the Trust only (and
therefore the Issuer Trustee's liability to make payments
of interest and principal on the Offered Notes is limited
to the collections received by the Issuer Trustee from the
Trust Assets) and except in certain limited circumstances
are not the personal obligation of the Issuer Trustee. See
"THE ISSUER TRUSTEE--Limitation of Issuer Trustee's
Liability." They are issued with the benefit of, and
subject to the Transaction Documents. The Issuer Trustee's
liability in respect of the Offered Notes is limited to
the assets of the Trust available in accordance with the
terms of the Transaction Documents to meet its obligations
in relation to the Offered Notes and, except in certain
limited circumstances, the Issuer Trustee will not be
personally liable in respect of the Offered Notes.
A. The Housing Loans.......... The Housing Loans will consist of Housing Loans with
an aggregate Balance Outstanding on the Cut-Off Date of
A$ . The Housing Loans are also referred to herein as
the "Mortgage Pool." The Housing Loans will be secured by
Mortgaged Properties (as defined herein) located in any of
the six states or two territories of Australia. A
"Mortgaged Property" means the land, including all
improvements thereon, that is the subject of a Mortgage.
Each Housing Loan is secured by a registered first ranking
mortgage over the related Mortgaged Property. "Registered"
means the mortgage has been filed with the lands office in
the relevant Australian State or Territory, granting
certain rights with respect to the applicable Mortgaged
Property. See "APPENDIX I--GLOSSARY OF AUSTRALIAN LEGAL
TERMS."
Each Housing Loan requires that borrowers on such Housing
Loan (each, a "Borrower") make a minimum payment (the
"Scheduled Payment") on or before the due date for such
Scheduled Payment under the relevant Housing Loan
documents. Scheduled Payments not received with respect to
certain Housing Loans on the related due date may cause
either a default rate of interest to be charged or a
compounding interest effect.
All weighted averages specified herein are weighted based
on the Cut-Off Date Balances Outstanding of the Housing
Loans. With respect to each Housing Loan, the "Cut-Off
Date Balance Outstanding" is the unpaid principal balance
of such Housing Loan as of the close of business on the
Cut-Off Date. All Housing Loan statistics set forth herein
are based on principal balances, interest rates, terms to
maturity, mortgage loan counts and similar statistics as
of the Cut-Off Date, unless indicated to the contrary
herein. References to percentages of the Housing Loans
mean percentages of the Cut-Off Date Balance Outstanding.
The Housing Loans bear interest at variable and fixed
rates (the "Mortgage Rates") which, as of the Cut-Off
Date, range from
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approximately to . The weighted average
Mortgage Rate of the Housing Loans on the Cut-Off Date is
approximately % per annum. The Cut-Off Date Balances
Outstanding of the Housing Loans ranged from approximately
A$ to A$ . The average Cut-Off Date Balance
Outstanding of the Housing Loans is approximately
A$ . The weighted average original term to stated
maturity of the Housing Loans was approximately months.
The weighted average remaining term to stated maturity of
the Housing Loans was approximately months. As of the
Cut-Off Date, the weighted average number of months that
had elapsed since origination of the Housing Loans is
approximately months.
Housing Loans representing approximately % of the
Cut-Off Date Pool Balance are secured by Mortgaged
Properties which are investment properties (based solely
upon statements made by the related Mortgagors at the time
of origination of the related Housing Loans).
The lowest and highest LVR as of the Cut-Off Date of the
Housing Loans were approximately % and %. LVR is
calculated as a fraction, expressed as a percentage, the
numerator of which is the outstanding amount of the
Housing Loan, plus any other amount serviced on the
Servicing System of the Servicer (the "Mortgage Servicing
System") and secured by the relevant Mortgage Property at
the Cut-Off Date and the denominator of which is the
aggregate value of the Mortgaged Property subject to the
related Mortgage for that Housing Loan.
B. Mortgage Insurance
Policies.................... See "Mortgage Insurance Policies" in this summary and "THE
MORTGAGE INSURANCE POLICIES" herein.
C. Collections Account........ Westpac or the Servicer will be required to remit
Collections received with respect to the Housing Loans
during a Collection Period to one or more accounts in the
name of the Issuer Trustee (the "Collections Account").
Initially, the Collections Account shall be maintained
with Westpac. Under certain conditions described herein,
such remittances may be made on a quarterly basis, two
Business Days prior to the related Payment Date. If such
conditions are not met, the Servicer shall deposit all
Collections in its possession or control into the
Collections Account no later than five Business Days
following receipt. See "DESCRIPTION OF THE OFFERED
NOTES--Collections and Payment."
D. Liquidity Support.......... 1. PRINCIPAL DRAWS: If the Trust Manager determines on any
Collection Determination Date that the Available Income
(as defined herein) of the Trust for a Collection Period
is insufficient to meet Total Payments of the Trust on the
following Payment Date (a "Payment Shortfall"), then
Principal Collections collected during that Collection
Period can be used to fund the Payment Shortfall (a
"Principal Draw"). See "DESCRIPTION OF THE OFFERED
NOTES--Principal Draws" below.
Amounts paid from any Principal Collections in this way
will be reimbursed through any Excess Available Income to
the extent available in subsequent periods after all
Principal Charge Offs and
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Carryover Charge Offs (as defined herein) have been met
out of that Excess Available Income for the relevant
period. If there is insufficient Excess Available Income
to reimburse Principal Draws, the principal repayable on
the Notes at maturity may be reduced in respect of such
shortfall.
2. LIQUIDITY FACILITY: Under the Liquidity Facility,
Westpac in its capacity as the provider of the Liquidity
Facility (the "Liquidity Facility Provider") agrees to
make advances to the Issuer Trustee for the purpose of
funding certain income shortfalls in the Trust, up to an
aggregate amount being the lesser of: (1) A$ , (2)
the Unpaid Balance of all Performing Loans from time to
time, and (3) any lesser amount as is agreed in writing
between the Liquidity Facility Provider, the Issuer
Trustee, the Trust Manager and the Rating Agencies, as
such amount may be reduced or cancelled under the
Liquidity Facility (the "Liquidity Limit"). The "Unpaid
Balance" of a Housing Loan, means the sum of (a) the
unpaid principal amount of that Housing Loan; and (b) the
unpaid amount of all finance charges, interest payments
and other amounts accrued on or payable under or in
connection with that Housing Loan or the related Mortgage
or other rights relating to the Housing Loan.
A "Performing Loan" at any date is a Housing Loan which is
not Delinquent or has been Delinquent for less than 90
consecutive days, or if it has been Delinquent for 90 or
more consecutive days, was insured under a Mortgage
Insurance Policy at the date of the Liquidity Facility. A
Housing Loan is "Delinquent" if the related Borrower fails
to pay any amount due on the related due date. Delayed
payments arising from agreed payment holidays based on
early repayments, or from maternity or paternity leave
repayment reductions will not, by themselves, lead to a
Housing Loan being considered Delinquent. See "WESTPAC
RESIDENTIAL LOAN PROGRAM--Housing Loan Features" and "THE
LIQUIDITY FACILITY" herein.
E. Transaction Documents...... MASTER TRUST DEED AND SERIES NOTICE: The Master Trust
Deed, which is governed by the laws of New South Wales,
Australia, provides for the creation of an unlimited
number of WST trusts. Each WST trust is a separate and
distinct trust fund. The Series 1998-1G WST Trust (the
"Trust") will be created pursuant to the Master Trust
Deed, the Notice of Creation of Trust and a series notice
(the "Series Notice") which sets forth specific provisions
regarding the Trust and details the provisions of the
Notes. See "FORMATION OF THE TRUST" and "DESCRIPTION OF
THE OFFERED NOTES."
SECURITY TRUST DEED: Pursuant to the Security Trust Deed,
the Issuer Trustee will grant a first ranking floating
charge over the Trust Assets to the Security Trustee, in
order to secure the Issuer Trustee's obligations to the
Noteholders, the Note Trustee, the Trust Manager, the Swap
Providers (as defined herein), the Security Trustee, and
each provider of a Support Facility (other than the
provider of a Mortgage Insurance Policy) to an Approved
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Seller and in respect of any Accrued Interest Adjustment,
to Westpac in respect of Redraws and to the holders of the
RFSs (if any) and the holders of the RFS Class A Notes (if
any) (such creditors, together the "Mortgagees"). A
"Support Facility" is any of the Liquidity Facility, the
Redraw Facility, the Swap Agreements (as defined herein)
or any of the Mortgage Insurance Policies. See "SECURITY
FOR THE NOTES."
The Issuer Trustee will grant a "floating charge" over the
Trust Assets to the Security Trustee in order to secure
the Issuer Trustee's obligations in respect of the Notes
and the Transaction Documents. A "charge" is a proprietary
interest created over property. A floating charge is a
grant of a security interest which "floats" over a group
of assets which assets may change or be dealt with from
time to time. A floating charge allows the person or
entity granting the charge (the "chargor") to deal with
the assets and to give third parties title to those assets
free from any encumbrance. For a description of a floating
charge and the crystallization of floating charges, see
"SECURITY FOR THE NOTES--Nature of Security", "--Charge"
and "APPENDIX I-- GLOSSARY OF AUSTRALIAN LEGAL TERMS."
SERVICING AGREEMENT: Under the Servicing Agreement, TMC is
appointed as the initial Servicer of the Housing Loans and
custodian of the documents relating to the Housing Loans
and Mortgages. See "DESCRIPTION OF THE SERVICING
AGREEMENT."
NOTE TRUST DEED: The Note Trust Deed provides for the
issuance and registration of the Offered Notes. See
"DESCRIPTION OF THE OFFERED NOTES."
SWAP AGREEMENTS: The rights of the Issuer Trustee under
the Swap Agreements will be subject to the security
created by the Security Trust Deed. The "Swap Agreements"
include the 1991 ISDA Master Agreement (the "ISDA Master
Agreement") and the amended schedules and Swap
confirmations covering the Variable Rate Basis Swap, two
Fixed Rate Basis Swaps and the Currency Swap. See
"DESCRIPTION OF THE SWAP AGREEMENTS."
AGENCY AGREEMENT: Pursuant to the Agency Agreement, the
Issuer Trustee will appoint paying agents with respect to
the Offered Notes.
LIQUIDITY FACILITY AGREEMENT: Under the Liquidity Facility
Agreement, the Liquidity Facility Provider agrees to make
advances to the Issuer Trustee for the purpose of funding
certain income shortfalls in the Trust. See "THE LIQUIDITY
FACILITY."
REDRAW FACILITY AGREEMENT: On or prior to the Closing
Date, Westpac will enter into a Redraw Facility Agreement
(the "Redraw Facility Agreement") in its capacity as
Redraw Facility Provider with the Issuer Trustee. Pursuant
to the terms of the Redraw Facility Agreement, the Redraw
Facility Provider shall be obligated, subject to the
limitations set forth herein, to fund the amount of
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any Redraws not funded by Gross Principal Collections. See
"DESCRIPTION OF THE OFFERED NOTES--Redraw Facility."
The Master Trust Deed, the Series Notice, the Servicing
Agreement, the Security Trust Deed, the Note Trust Deed,
the Swap Agreements, the Agency Agreement, the Liquidity
Facility Agreement and the Redraw Facility Agreement are
collectively referred to herein as the "Transaction
Documents."
Clearance and Settlement........ Noteholders may elect to hold their Notes through any of
DTC (in the United States) or Cedel or Euroclear (in
Europe). Transfers within DTC, Cedel or Euroclear, as the
case may be, will be in accordance with the usual rules
and operating procedures of the relevant system.
Crossmarket transfers between persons holding directly or
indirectly through DTC, on the one hand, and
counterparties holding directly or indirectly through
Cedel or Euroclear, on the other, will be effected in DTC
through the Relevant Depositaries of Cedel or Euroclear.
See "DESCRIPTION OF THE OFFERED NOTES--Book-Entry
Registration."
Clean-up Offer.................. If at any time the aggregate Housing Loan Principal,
expressed as a percentage of the aggregate Housing Loan
Principal as of the Cut-Off Date, is less than 10%, then,
if instructed by the Trust Manager, the Seller Trustee, as
trustee of certain other trusts under the Master Trust
Deed, may repurchase, on the following Payment Date, the
equitable title to the Housing Loans held by the Trust for
an amount equal to the Unpaid Balance (in the case of
performing Housing Loans) or the Fair Market Value (in the
case of non-performing Housing Loans) (the "Clean-up
Offer"). The proceeds of sale will be applied by the
Issuer Trustee to repay moneys owing to Noteholders at
that time in accordance with the priorities for applying
payments of Interest and principal between the Classes of
Notes. With respect to any Housing Loan and date, "Housing
Loan Principal" shall be the unpaid principal amount of
that Housing Loan on such date. "Unpaid Balance" of a
Housing Loan, means the sum of (a) the unpaid principal
amount of that Housing Loan; and (b) the unpaid amount of
all finance charges, interest payments and other amounts
accrued on or payable under or in connection with that
Housing Loan or the related Mortgage or other rights
relating to the Housing Loan. The "Fair Market Value" with
respect to any non-performing Housing Loans is the fair
market value of such Housing Loan agreed on by the Trust
Manager (based on appropriate expert advice) and the
Approved Seller.
Redemption for Taxation or Other
Reasons....................... If the Trust Manager satisfies the Issuer Trustee and the
Note Trustee immediately prior to giving the notice
referred to below that either (i) on the next Payment Date
the Issuer Trustee would be required to deduct or withhold
from any payment of principal or interest in respect of
any Offered Notes any amount for or on account of any
present or future taxes, duties, assessments or
governmental charges of whatever nature imposed, levied,
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collected, withheld or assessed by the Commonwealth of
Australia or any of its political subdivisions or any of
its authorities or (ii) the total amount payable in
respect of interest in relation to any of the Housing
Loans for a Collection Period ceases to be receivable
(whether or not actually received) by the Issuer Trustee
during such Collection Period, the Issuer Trustee must,
when so directed by the Trust Manager (at the Trust
Manager's option) (provided that the Issuer Trustee will
be in a position on such Payment Date to discharge (and
will so certify to the Issuer Trustee and the Note
Trustee) all its liabilities in respect of such Class and
any amounts required under the Security Trust Deed to be
paid in priority to or PARI PASSU with such Class), at any
time at its option, having given not more than 60 nor less
than 30 days' notice to the Noteholders of such Class,
redeem all, but not some, of such Class at their Invested
Amount (or at the option of the Noteholder of such Class,
to be exercised by way of Extraordinary Resolution of the
Noteholders of such Class, at their Stated Amount),
together with accrued interest to the date of redemption
on any subsequent Payment Date, provided that the
Noteholders of such Class may by Extraordinary Resolution
elect, and shall notify the Issuer Trustee and the Trust
Manager, that they do not require the Issuer Trustee to
redeem such Class of Notes in the circumstances described
above.
Legal Investment
Considerations................ The Offered Notes will not constitute "mortgage related
securities" for purposes of the Secondary Mortgage Market
Enhancement Act of 1984 ("SMMEA"). No representation is
made as to whether the Offered Notes constitute legal
investments under any applicable statute, law, rule,
regulation or order for any entity whose investment
activities are subject to investment laws and regulations
or to review by certain regulatory authorities.
Prospective purchasers are urged to consult with their
counsel concerning the status of the Offered Notes as
legal investments for such purchasers. See "LEGAL
INVESTMENT CONSIDERATIONS" herein.
Tax Status...................... In the opinion of Mayer, Brown & Platt, special tax
counsel for the Trust, the Offered Notes will be
characterized as debt for U.S. federal income tax purposes
and the Trust will not be characterized as an association
(or a publicly traded partnership) taxable as a
corporation for federal income tax purposes. Each Offered
Noteholder, by acceptance of an Offered Note, will agree
to treat the Offered Notes as indebtedness. See "CERTAIN
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES" herein.
Payments of principal and Interest in respect of the
Offered Notes will be made subject to withholding tax (if
any) applicable to the Offered Notes without the Issuer
Trustee being obliged to pay any additional amounts to the
Noteholders in respect of such withholding tax.
ERISA Considerations............ Subject to the considerations discussed under "ERISA
CONSIDERATIONS," the Offered Notes are eligible for
purchase
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by employee benefit plans. See "ERISA CONSIDERATIONS"
herein.
Ratings of the Offered Notes.... It is a condition to the issuance of the Class A Notes
that they be rated "AAA" by Standard & Poor's Ratings
Group, a division of The McGraw-Hill Companies ("Standard
& Poor's"), "Aaa" by Moody's Investors Service, Inc.
("Moody's") and "AAA" by Fitch IBCA, Inc. ("Fitch").
Moody's, Fitch and Standard & Poor's are referred to
herein as the "Rating Agencies." It is a condition to the
issuance of the Class B Notes that they be rated "AA-" by
Standard & Poor's and "AA-" by Fitch. The security ratings
of the Offered Notes should be evaluated independently
from similar ratings on other types of securities. A
security rating is not a recommendation to buy, sell or
hold securities and may be subject to revision or
withdrawal at any time by the Rating Agencies. See
"RATINGS OF THE NOTES" herein.
Governing Law................... The Notes and the Transaction Documents (other than the
Security Trust Deed) are governed by, and shall be
construed in accordance with, the laws of New South Wales,
Australia. The Security Trust Deed is governed by, and
shall be construed in accordance with, the laws of the
Australian Capital Territory.
The Issuer Trustee has, under the Note Trust Deed,
submitted to the non-exclusive jurisdiction of the courts
of New South Wales for all purposes in connection with the
Offered Notes.
Risk Factors.................... In considering an investment in the Offered Notes,
investors should recognize that there are risks associated
with such an investment. See "Risk Factors" herein.
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STRUCTURAL CHART
This chart depicts the basic structure of the transaction
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CASH FLOW SUMMARY
THE FOLLOWING IS A BRIEF SUMMARY OF THE ALLOCATION OF CASHFLOWS IN RELATION
TO THE TRUST. THIS CASH FLOW SUMMARY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO THE DETAILED INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS --SEE
"DESCRIPTION OF THE OFFERED NOTES" FOR A FULL DESCRIPTION OF CASHFLOW
ALLOCATION. TERMS DEFINED BELOW ARE DEFINED IN MORE DETAIL ELSEWHERE--THE
DEFINITIONS BELOW ARE FOR CONVENIENCE ONLY.
COLLECTIONS
Amounts collected by or on behalf of the Issuer Trustee in respect of the
Trust are calculated for each Collection Period and include, for the relevant
Collection Period:
1. scheduled payments (of interest, principal and fees) and prepayments of
principal under the Housing Loans;
2. proceeds from enforcement of Housing Loans and related Mortgages (see
"CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS--Enforcement of Housing Loans");
3. amounts payable under Mortgage Insurance Policies with respect to losses
on Housing Loans and related Mortgages;
4. amounts received from an Approved Seller or the Servicer for breaches of
representations or undertakings; and
5. interest on amounts in the Collections Account.
These amounts are known as "Collections," which will be attributed between
income and principal. The Collections attributed to income, less certain
amounts, are "Available Income". The Collections attributed to principal, less
certain amounts, are "Gross Principal Collections".
The cashflow allocation methodology treats Available Income and Gross
Principal Collections in two separate "streams." Generally, the two streams are
treated separately. However, in some circumstances, principal will be treated as
income and applied in the income stream, and in other circumstances income will
be treated as principal and applied in the principal stream.
GROSS PRINCIPAL COLLECTIONS
Gross Principal Collections are applied first to repay Westpac for any
Redraws funded by Westpac in the relevant Collection Period. The balance of
Gross Principal Collections remaining after such repayment of Westpac is known
as "Principal Collections." Those Principal Collections are applied:
1. First, to repay Westpac for any Redraws funded by Westpac to the extent
not previously reimbursed (I.E., not restricted to Redraws funded during the
relevant Collection Period);
2. Second, to repay amounts outstanding under the Redraw Facility
Agreement;
3. Third, to be treated as income to the extent necessary if there is
insufficient income for the Collection Period to make required income payments
(this application of principal as income is a "Principal Draw");
4. Fourth, to pay principal outstanding under the RFSs until repaid in
full;
5. Fifth, to pay principal outstanding under the Class A Notes and the RFS
Class A Notes. Those payments may be applied either sequentially or serially
with respect to Class B Notes, depending on whether certain threshold tests have
been satisfied.
Initially all Principal Collections will be applied "sequentially," meaning
that such Principal Collections will be applied to the RFSs (if any), Class A
Notes and RFS Class A Notes (if any), pro rata, until such classes are paid in
full. The Class B Notes are then entitled to Principal Collections.
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If certain distribution tests have been met, Principal Collections will be
applied "serially", entitling the Class A Notes and the Class B Notes to share
in Principal Collections. There are two serial distribution tests which focus on
whether the subordination provided by the Class B Notes to the Class A Notes
effectively doubles from the initial level of subordination at the start of the
transaction, whether the distribution of Principal Collections is occurring
prior to a certain date and whether certain credit tests focusing on
delinquencies and losses on the Housing Loans have been met. For a complete
description of the serial distribution tests, see the definitions of "Serial
Method 1 Distribution Test" and "Series Method 2 Distribution Test" set forth in
"DESCRIPTION OF THE OFFERED NOTES--Payments of Principal on the Notes."
6. Sixth, to pay principal outstanding under the Class B Notes under the
sequential or serial methods referred to above.
PRINCIPAL LOSSES
It may be that principal losses are incurred in respect of a Housing Loan
during a Collection Period.
If (i) a Borrower defaults; (ii) the relevant Housing Loan and related
Mortgage are enforced; and (iii) the amount recovered (after payment of
enforcement expenses) will not satisfy the Unpaid Balance of the Housing Loan,
there will be a "Liquidation Loss". A Liquidation Loss will usually comprise
both income and principal. To the extent that it relates to principal, a
Liquidation Loss is known as a "Principal Loss". If, following a Principal Loss,
the relevant Mortgage Insurance Policy does not cover that loss and the Issuer
Trustee does not have a right to recover any amounts from an Approved Seller or
the Servicer due to a breach of representation or undertaking, there will be a
loss on the underlying principal in the pool. Such a loss is a "Mortgage
Shortfall". The total amount of all Mortgage Shortfalls in a Collection Period
is known as the "Principal Charge Off" for that Collection Period.
Any Principal Charge Off for a Collection Period may be met by any excess
income which is available from the income stream for that purpose (as summarized
below). If the Principal Charge Off cannot be satisfied in full from that excess
income, the principal loss represented by the balance of the Principal Charge
Off which is not so satisfied must be "carried over" into succeeding periods.
This is a "Carryover Charge Off".
Each Carryover Charge Off must be represented by a reduction in the
principal amount of the Notes. Thus, the principal amount of the Notes (the
"Invested Amount") is reduced:
(a) First, in respect of Class B Notes; and
(b) Second, if the Class B Notes are reduced to zero, PRO RATA, in
respect of the Class A Notes, the RFSs, the RFS Class A Notes and the Redraw
Facility Agreement.
The "Stated Amount" of a Note is thus the Invested Amount of the Note less
the Carryover Charge Offs applied against it as set out above.
Excess income may be used to recover principal which has been reduced
following a Carryover Charge Off. The application of income for this purpose is
summarized below.
INCOME COLLECTIONS
Available Income is applied in the following order of priority:
(a) First, in respect of the first Collection Period, to the Approved
Seller for income received by the Issuer Trustee on the pool relating to the
period prior to the Closing Date. This is the "Accrued Interest Adjustment";
(b) Second, to Trust Expenses which have not previously been paid;
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(c) Third, to repay amounts outstanding under the Support Facilities
(other than the Currency Swap and fees under the Liquidity Facility
Agreement);
(d) Fourth, to repay Liquidity Draws under the Liquidity Facility
Agreement;
(e) Fifth, PARI PASSU and ratably, to interest on the Class A Notes, the
RFSs and the RFS Class A Notes and to fees under the Redraw Facility
Agreement; and
(f) Sixth, to interest on the Class B Notes.
These payments are "Total Payments".
Any Available Income in excess of Total Payments for a Collection Period is
"Excess Available Income", and is applied in the following order of priority:
(i) First, against Principal Charge Offs for the Collection Period;
(ii) Second, PARI PASSU and ratably, against Carryover Charge Offs for
Class A Notes, RFSs, RFS Class A Notes and fees or amounts owing under the
Redraw Facility Agreement;
(iii) Third, against Carryover Charge Offs for Class B Notes; and
(iv) Fourth, to Principal Draws which have not previously been repaid.
Any amount remaining after application of these payments is an "Excess
Collections Distribution", and will be paid to Westpac as beneficiary of the
Trust.
LIQUIDITY SUPPORT
If there are insufficient interest Collections to meet Total Payments for a
Collection Period, principal may be used to provide liquidity by way of a
"Principal Draw" (see above).
If Principal Draws are not available to meet Total Payments, a drawing must
be made under the Liquidity Facility Agreement up to its facility limit (being
A$ ) to provide liquidity to allow Total Payments to be made.
CURRENCY SWAP
All payments required to be made to Noteholders will be made in Australian
dollars to the Currency Swap Providers, who will swap the amounts into US
dollars.
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CASH FLOW CHART
[CHART]
This chart depicts a cash-flow summary
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[CHART]
This chart depicts a cash-flow summary
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RISK FACTORS
In addition to the matters described elsewhere in this Prospectus,
prospective investors should carefully consider the following factors before
deciding to invest in the Offered Notes.
LIMITED LIABILITY UNDER THE OFFERED NOTES
The Offered Notes are debt obligations of the Issuer Trustee in its capacity
as trustee of the Trust. They are issued with the benefit of, and subject to the
Master Trust Deed, the Series Notice, the Security Trust Deed and the Note Trust
Deed. The Issuer Trustee's liability in respect of the Offered Notes is limited
to the assets of the Trust available in accordance with the terms of the Master
Trust Deed, the Series Notice, the Note Trust Deed and the Security Trust Deed
to meet its obligations in relation to the Offered Notes and, except in certain
limited circumstances, the Issuer Trustee will not be personally liable in
respect of the Offered Notes. See "THE ISSUER TRUSTEE--Limitation of Issuer
Trustee's Liability."
In addition, the Offered Notes will not represent an interest in or
obligation of the Servicer, the Trust Manager, the Approved Sellers, the Note
Trustee, the Security Trustee or any of their respective affiliates (other than
the Issuer Trustee to the extent referred to above). The only obligations of the
foregoing entities with respect to the Offered Notes or any Housing Loan will be
the obligations of the Approved Sellers pursuant to certain limited
representations and warranties made with respect to the Housing Loans, of the
Servicer with respect to its servicing obligations under the Servicing Agreement
and the Trust Manager in respect of its undertakings in the Transaction
Documents. The Offered Notes will not be guaranteed or insured by any
governmental agency or instrumentality, or by the Issuer Trustee, the Servicer,
the Trust Manager, the Approved Sellers, the Note Trustee, the Security Trustee
or any of their respective affiliates. The Housing Loans are subject to certain
mortgage insurance policies, but only limited losses are covered. Housing Loans
insured by HLIC prior to December 12, 1997 will have the benefit of a
Commonwealth Government Guarantee. See "THE MORTGAGE INSURANCE POLICIES."
Proceeds of the assets included in the Trust (including the Housing Loans) will
be the sole source of payments on the Offered Notes, and there will be no
recourse to the Servicer, the Trust Manager, the Approved Sellers, the Note
Trustee, the Security Trustee or any other entity in the event that such
proceeds are insufficient or otherwise unavailable to make all payments provided
for under the Offered Notes.
RISK OF EQUITABLE ASSIGNMENT OF HOUSING LOANS RATHER THAN LEGAL ASSIGNMENT
Although the Housing Loans and the related Mortgages could have been legally
assigned by the Seller Trustee to the Issuer Trustee, they will initially only
be equitably assigned until a Title Perfection Event (as defined below) occurs.
A "Title Perfection Event" in relation to the Housing Loans is the occurrence of
any of the following: (i) Westpac ceases to have a long term credit rating of at
least "BBB" from Standard & Poor's, "Baa2" from Moody's; and "BBB" from Fitch
(ii) an Insolvency Event occurs with respect to Westpac; and (iii) Westpac fails
to transfer Collections within five Business Days after receiving notice from
the Issuer Trustee or the Trust Manager to do so. Until such time, pursuant to
the Transaction Documents, the Issuer Trustee is not permitted to take any steps
to perfect legal title and it cannot, and will not, notify the Borrowers of the
equitable assignment of the Housing Loans to the Issuer Trustee. If a Title
Perfection Event occurs, the Issuer Trustee, with the assistance of the
Servicer, is required take such steps as are necessary to perfect the Issuer
Trustee's legal title in the Housing Loans.
The delay in the notification to a Borrower of the assignment of the Housing
Loans to the Issuer Trustee may have the following consequences:
(1) until a Borrower has notice of the assignment, that Borrower is not
bound to make payments under the relevant Housing Loan to anyone other than
Westpac and can obtain a valid discharge from Westpac. However, the Servicer, a
delegate of Westpac, will act as the initial Servicer of the Housing Loans and
is obligated to deal with all moneys received from the Borrowers in accordance
with the Servicing Agreement and the Master Trust Deed;
(2) for so long as the Issuer Trustee holds only an equitable interest in
the Housing Loans, the Issuer Trustee's interest in them may become subject to
the interests of third parties created after the creation of
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the Issuer Trustee's equitable interest but prior to it acquiring a legal
interest in the Housing Loans. However, the Servicer undertakes not to consent
to the creation or existence of any higher or equal ranking security interest
over the Mortgaged Property (the "Servicer's Security Undertaking"); and
(3) for so long as the Issuer Trustee holds only an equitable interest in
the Housing Loans, it must join Westpac as a party to any legal proceedings
against any Borrower in relation to the enforcement of any Housing Loan. In this
regard, Westpac undertakes in the Servicing Agreement to co-operate with the
Servicer in connection with the enforcement of any Housing Loans. Westpac has
granted an irrevocable power of attorney to the Issuer Trustee to perfect its
interest in the Housing Loans.
So long as the Issuer Trustee holds equitable title, rather than legal
title, to a Housing Loan, the Issuer Trustee's interest in such Housing Loan may
be impaired by the creation or existence of any higher or equal ranking security
interest over the related Mortgaged Property if the Servicer fails to adhere to
the Servicer's Security Undertaking. Such failure may result in losses to
Noteholders.
RISK OF LOSSES AND DELAYS FROM ENFORCEMENT OF THE HOUSING LOANS
Substantial delays could be encountered in connection with the liquidation
of a Housing Loan and result in shortfalls in distributions to Noteholders to
the extent not covered by a Mortgage Insurance Policy or if the relevant
Mortgage Insurance Policy provider fails to perform its obligations. Further,
liquidation expenses such as legal fees, real estate taxes, and maintenance and
preservation expenses (to the extent not covered by a Mortgage Insurance Policy)
will reduce the net amounts recoverable by the Issuer Trustee from an enforced
Housing Loan and mortgage and will reduce Excess Available Income. In the event
any of the Mortgaged Properties fail to provide adequate security for the
related Housing Loans, Noteholders could experience a loss to the extent not
covered by a Mortgage Insurance Policy or if the relevant Mortgage Insurance
Policy provider fails to perform its obligations and the subordination of Excess
Available Income is not sufficient.
MORTGAGE INSURANCE POLICIES ARE SUBJECT TO EXCLUSIONS AND LIMITATIONS
The liability of each of the Mortgage Insurers under the Mortgage Pool
Insurance Policy and the PMI Policies, as applicable, is subject to certain
exclusions. Each of them also has the right to cancel the coverage of, or
terminate its Mortgage Insurance Policy in respect of, a Housing Loan in certain
circumstances. The exclusions and rights vary among the different Mortgage
Insurance Policies and may affect the ability of the Issuer Trustee to make
timely and full payments of principal and Interest on the Notes. See "THE
MORTGAGE INSURANCE POLICIES" for further details.
RISKS ASSOCIATED WITH HIGH LVR HOUSING LOANS
Approximately % of the Housing Loans by aggregate principal balance of
the related Housing Loans as of the CutOff Date, had an LVR in excess of 80%.
Housing Loans with higher LVRs may present a greater risk of delinquency.
Although each Housing Loan in the Trust with an LVR in excess of 80% is covered
by a PMI Policy which insures the full amount of the Unpaid Balance of the
related Housing Loan, if a Borrower fails to make payments under such a Housing
Loan and the applicable Mortgage Insurer cancels the relevant PMI Policy,
reduces the amount of a claim or fails to honor its obligation under the PMI
Policy, proceeds from a liquidation of such Housing Loan may be insufficient to
cover the Unpaid Balance thereof. As a result, Noteholders may experience losses
including Principal Charge Offs (as defined herein) with respect to the Offered
Notes. For a description of such coverage, see "THE MORTGAGE INSURANCE
POLICIES."
RISKS ASSOCIATED WITH WESTPAC'S ABILITY TO SET RATES ON VARIABLE RATE HOUSING
LOANS AT ITS DISCRETION
The interest rates with respect to the Variable Rate Housing Loans are not
tied to an objective interest index but rather may be set at the sole discretion
of Westpac, as originator of the Housing Loans. See "WESTPAC RESIDENTIAL LOAN
PROGRAM--Housing Loan Features." In the event that Westpac increases interest
rates on the Variable Rate Housing Loans, Borrowers may be unable to meet
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their Scheduled Payment and accordingly, may be delinquent or default on their
respective Housing Loans. In addition, if such increase raises interest rates
above market interest rates, Borrowers may refinance their loans with another
lender to obtain a lower interest rate, which in turn could cause investors in
the Offered Notes to experience higher rates of principal prepayment on the
Offered Notes than anticipated.
ABILITY TO CHANGE HOUSING LOAN FEATURES MAY RESULT IN CHANGES TO THE MORTGAGE
POOL AND HIGHER RATES OF PRINCIPAL PREPAYMENT ON THE OFFERED NOTES.
During the term of any Housing Loan, Westpac may from time to time or at the
request of the related Borrower change certain features of such Housing Loan. A
Borrower may request, among other changes, (a) additional funds with respect to
its Housing Loan (a "top up"), (b) a substitution or modification of the
security for the related Mortgage, (c) a switch to another type of Housing Loan
product, (d) a draw on principal repayments made in excess of scheduled
repayments (a "Redraw"), (e) an interest rate switch from variable to fixed or
vice versa, (f) reduced payments due to maternity or paternity leave, (g) a
repayment holiday if a prepayment of certain amounts has resulted in a buffer of
funds and (h) a switch from owner occupied or investment property status (which
may result in a change in interest rates). For a more detailed discussion of the
various features available to Borrowers, see "WESTPAC RESIDENTIAL LOAN PROGRAM--
Housing Loan Features."
In addition, Westpac may initiate certain changes to the Housing Loans. Most
frequently, Westpac will change the Mortgage Rate. The change to the Mortgage
Rate can be either product or individual loan specific. In addition, subject to
certain conditions, Westpac may begin to offer additional product features with
respect to the Housing Loans which are not set forth herein. See "WESTPAC
RESIDENTIAL LOAN PROGRAM-Housing Loan Features-Additional Features."
As a result of both Borrower and Westpac initiated changes, the
characteristics of the Housing Loans as of the Cut-Off Date may differ from the
characteristics of the Housing Loans at any other point in time. In addition,
certain types of modifications to a Housing Loan result in the removal of such
Housing Loan from the Mortgage Pool, which in turn could cause investors in the
Offered Notes to experience higher rates of principal prepayment on the Offered
Notes than anticipated. Similarly, if Westpac elects to change certain features
of the Housing Loans, Borrowers may elect to refinance their loan with another
lender to obtain more favorable features, which also could lead to higher
principal prepayment on the Offered Notes than expected. See " PRINCIPAL PAYMENT
AND YIELD CONSIDERATIONS."
RISKS OF CURRENCY EXCHANGE CONTROLS
The Issuer Trustee will receive Australian dollar payments on the Housing
Loans in Australia and, under the Currency Swap, is required to pay certain
collections to the Currency Swap Providers as required under the Series Notice.
It is possible that in the future Australia may impose exchange controls that
affect the availability of Australian dollar payments for making payments under
the Currency Swap. The Noteholders will bear the risk of the imposition of
foreign exchange controls by the Australian government that impact upon the
Issuer Trustee's ability to exchange the Collections for U.S. dollars. The
Issuer Trustee has no control over such risk, which will generally be affected
by economic and political events in Australia. If the Issuer Trustee does not
pay some or all of the amounts in Australian dollars which it is required by the
Transaction Documents to pay to the Currency Swap Providers under the Currency
Swap, the Currency Swap Providers are only required to pay the U.S. dollar
equivalent of the amounts they actually receive. In such event, it is unlikely
that the Trust would have sufficient U.S. dollars to make the payments due on
the Offered Notes.
RISKS RELATED TO A TERMINATION OF THE SWAP AGREEMENTS
By entering into the Swap Agreements, the Trust intends to transfer to the
Interest Rate Swap Provider and Currency Swap Providers, as applicable, the
risks set forth below that the Trust would otherwise have with respect to the
Offered Notes and the Housing Loans.
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(a) Currency Exchange Risk. Interest and principal on the Offered Notes is
payable in U.S. dollars and the Trust's primary source for funding its payments
on the Offered Notes is its collections on the Housing Loans, which will be in
Australian dollars. If the Currency Swap Providers were to fail to perform under
the Currency Swap or were to be discharged from such performance because of a
default thereunder by the Trust, the Trust might have to exchange its Australian
dollars for U.S. dollars at an exchange rate that is less favorable to the Trust
than the original Swap Currency Exchange Rate (which is Australian dollars
for each U.S. dollar) and might therefore not have sufficient U.S. dollars to
make timely payments on the Offered Notes, even though the delinquency and loss
experience on the Housing Loans may be acceptable.
(b) Risks Specific to the Variable Rate Basis Swap. The basis risk between
the floating rate obligations of the Trust (including Interest payable on the
Notes) and the variable administered rates set by Westpac will be hedged by
means of the Variable Rate Basis Swap. Pursuant to the Variable Rate Basis Swap,
each quarter the Interest Rate Swap Provider will pay the Trust the three month
Bank Bill Rate plus a fixed margin and receive from the Trust the weighted
average variable housing rate. The margin is fixed for the life of the swap and
has been set having regard for the ongoing expenses of the Trust.
If Westpac is downgraded below A1+/A2/F-1+ and fails to provide eligible
collateral or arrange for a suitable alternative swap provider, it will be an
Additional Termination Event under the terms of the ISDA Master Agreement. If
the Variable Rate Basis Swap is terminated, the Trust Manager is required to
calculate each month the minimum interest rate required to be set on the
variable rate Housing Loans in order to cover amounts payable by the Issuer
Trustee (including anticipated Trust Expenses and taxes) and amounts due to the
Issuer Trustee, the Trust Manager, the Servicer, the Liquidity Facility
Provider, the Redraw Facility Provider and the Noteholders (the "Threshold
Rate"). In this situation, THE HOUSING LOAN RATES MAY BE SET AT ABOVE MARKET
INTEREST RATES ON THE VARIABLE HOUSING LOANS TO MEET TRUST EXPENSES WHICH COULD
RESULT IN THE AFFECTED BORROWERS REFINANCING THEIR LOANS WITH ANOTHER BANK,
WHICH IN TURN COULD CAUSE NOTEHOLDERS TO EXPERIENCE HIGHER RATES OF PRINCIPAL
REPAYMENT ON THE OFFERED NOTES THAN ANTICIPATED.
(c) Risks Specific to the Fixed Rate Swaps. Two Fixed Rate Swaps will be
used to hedge the interest rate risk between the floating rate obligations of
the Trust (including Interest payable on the Notes) and the discretionary fixed
rate set by Westpac on those Housing Loans being charged a fixed rate of
interest (a "Fixed Rate") (not including those loans with a Concessional Fixed
Rate). A Housing Loan is being charged a "Concessional Fixed Rate" when it has a
fixed rate of interest for the first 12 months, which converts to the standard
variable rate after that period. Loans subject to a Concessional Fixed Rate are
included under the Variable Rate Basis Swap. An amortizing Fixed Rate Swap will
be entered into as at Closing Date to hedge that portion of the pool earning a
Fixed Rate of interest as at Cutoff Date. The Issuer Trustee will pay the
applicable daily weighted average fixed rate and receive the three month Bank
Bill Rate plus a fixed margin. The margin is fixed for the life of the swap and
has been set based on the actual margin on the underlying Fixed Rate Housing
Loans and the prevailing market rate existing on or about the Closing Date. A
further Fixed Rate Basis Swap will be entered into to hedge the interest rate
risk occurring when the Borrowers switch from a variable rate of interest to a
fixed rate of interest. Under that second Fixed Rate Basis Swap, the Issuer
Trustee will pay the applicable daily weighted average fixed rate and receive
the three month Bank Bill Rate plus a fixed margin. The margin is fixed for the
life of the swap.
If Westpac is downgraded below A1+/A2/F-1+ and fails to provide eligible
collateral or arrange for a suitable alternative swap provider, it will be an
Additional Termination Event under the terms of the ISDA Master Agreement ONLY
AT THE DISCRETION OF THE ISSUER TRUSTEE AT THE DIRECTION OF THE TRUST MANAGER.
IF THE SWAP REMAINS IN PLACE, THE RATING AGENCIES MAY CONSIDER DOWNGRADING THE
OFFERED NOTES AND AN INVESTOR MAY THEN BE HOLDING OFFERED NOTES WHICH HAVE BEEN
DOWNGRADED. IF THE SWAP IS TERMINATED, THE INVESTOR IS EXPOSED TO THE RISK OF
THE POSSIBLE NARROWING OF THE SPREAD BETWEEN THE CUSTOMER RATE APPLICABLE ON THE
HOUSING LOANS AND THE FLOATING RATE OBLIGATIONS OF THE TRUST (INCLUDING THE
INTEREST ON THE NOTES).
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DELINQUENCY AND DEFAULT RISK
If Borrowers fail to make Scheduled Payments under Housing Loans when due
there is a possibility that the Issuer Trustee may have insufficient funds to
make full payments of Interest and principal due to the Noteholders.
The Issuer Trustee's obligation to pay principal in respect of the Offered
Notes in full is limited by reference to, among other things, receipts by the
Issuer Trustee of amounts due under or in respect of the outstanding Housing
Loans. Noteholders must rely for payment of principal and interest under the
Offered Notes on Borrowers making payments under the Housing Loans and on
amounts being available under the Mortgage Insurance Policies and any amounts
payable by an Approved Seller or the Servicer in respect of any breach of a
representation and warranty or undertaking respectively and, in addition, in the
case of Interest, on receipts of principal and required payments under the
Liquidity Facility. Furthermore, the Issuer Trustee is not required to make any
advances to cover shortfalls. See "DESCRIPTION OF THE OFFERED NOTES" and "THE
LIQUIDITY FACILITY."
A wide variety of factors of a legal, economic, political or other nature
could affect the performance of Borrowers in making payments of principal and
interest under the Housing Loans. In particular, if interest rates increase
significantly, Borrowers may experience distress and increased default rates on
the Housing Loans may result. Under the Consumer Credit Legislation (as defined
herein), among other remedies, a court may order a Housing Loan to be varied on
the grounds of hardship. See "CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS." Any
such variance may reduce the principal or interest payable under a particular
Housing Loan.
If a Borrower defaults on payments under a Housing Loan and the Servicer
enforces the Housing Loan and takes possession of the relevant Mortgaged
Property, many factors may affect the price for which the Mortgaged Property is
sold and the length of time required to realize the proceeds of sale. Any delay,
and any loss incurred as a result of the realized proceeds of the sale of a
Mortgaged Property being less than the amount due under the Housing Loan, may
affect the ability of the Issuer Trustee to make payments, or the timing of
those payments, in respect of the Offered Notes, notwithstanding any amounts
that may be claimed under a Mortgage Insurance Policy or otherwise allocated
from Principal Collections or drawn under the Liquidity Facility.
RISK OF EARLY DEFAULTS
No more than % of the Housing Loans were originated within months
prior to the Cut-Off Date. The weighted average remaining term to stated
maturity of such Housing Loans (by Cut-Off Date Balance Outstanding) is
approximately months. Although little data is available and no empirical
verification has been made by the Registrant, the Underwriters or the Issuer
Trustee, defaults on mortgage loans, including mortgage loans similar to the
Housing Loans, are generally expected to occur with greater frequency in the
early years of the terms of mortgage loans.
PRINCIPAL PAYMENT AND YIELD CONSIDERATIONS
The yield to maturity experienced by a Noteholder may be affected by the
rate of payment of principal of the Housing Loans. The Trust may receive early
payments of principal on the Housing Loans and, therefore, pay Principal
Collections to the Noteholders earlier than would otherwise have been the case.
For example, early payments of principal may occur in the following situations:
(1) receipt by the Issuer Trustee of enforcement proceeds due to a Borrower
having defaulted on its Housing Loan;
(2) receipt by the Issuer Trustee of insurance proceeds in relation to a
claim under a Mortgage Insurance Policy in respect of a Housing Loan;
(3) repurchase by Westpac of Housing Loans as a result of a breach by it of
certain representations (see "THE TRUST FUND--Representations and Warranties"
and "--Breach of Representations and Warranties");
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(4) receipt by the Trust of any net amount attributable to principal from
another WST trust established under the Master Trust Deed with respect to the
substitution of a Housing Loan;
(5) repurchase of the Housing Loans as a result of a Clean-Up Offer (see
"DESCRIPTION OF THE OFFERED NOTES--Clean-Up Offer");
(6) receipt of proceeds of enforcement of the Security Trust Deed prior to
the Maturity Date of the Notes (see "DESCRIPTION OF THE OFFERED
NOTES--Redemption of the Notes"); or
(7) receipt of proceeds of the sale of Housing Loans if the Trust is
terminated while Notes are outstanding (for example, if required by law) and the
Housing Loans are then either (a) repurchased by Westpac under its right of
first refusal or (b) sold to a third party.
Additionally, in certain limited circumstances (for example, if the
principal amount of a Housing Loan is increased other than as a result of a
Redraw (see "DESCRIPTION OF THE OFFERED NOTES-- Description of the Redraw
Facility, the Redraw Funding Securities and the Class A RFS Notes")), the Issuer
Trustee may transfer Housing Loans which comprise assets of the Trust to another
WST trust established under the Master Trust Deed. The consideration for that
transfer, to the extent it constitutes principal, will form part of Gross
Principal Collections (as defined herein) during the related Collection Period
and will be distributed as if it were a prepayment of principal by the relevant
Borrower.
Also, the Trust's principal payment experience may be affected by a wide
variety of factors, including general economic conditions, interest rates, the
availability of alternative financing, homeowner mobility and the non
tax-deductibility of interest on owner-occupied housing (see "CERTAIN LEGAL
ASPECTS OF THE HOUSING LOANS--Treatment of Interest Payments with respect to
Australian Housing Loans").
REINVESTMENT RISK
The Interest Rate Swap Agreements transfer the reinvestment risk detailed
below to the applicable Swap Provider. In the event that the Variable Rate Basis
Swap is terminated, the reinvestment risk will transfer back to the Issuer
Trustee. If a prepayment is received on a Housing Loan during any Collection
Period, interest at the then current interest rate on the Housing Loan will
cease to accrue on that part of the Housing Loan prepaid from the date of the
prepayment. The amount prepaid will be invested in Authorized Investments for
the balance of the Collection Period at a rate that may be less than the then
rate on the Housing Loan. Interest will, however, continue to be payable in
respect of an Invested Amount of principal on the Offered Notes until the next
Payment Date following the prepayment. Accordingly, the difference between the
rate earned on the prepaid amount of the Housing Loan and the amount of interest
payable on the Offered Notes may affect the ability of the Issuer Trustee to pay
interest in full on the Offered Notes. Certain Principal Collections and the
Liquidity Facility may cover such shortfalls in whole or in part but there is no
assurance that sufficient amounts will be available. For further details see
"DESCRIPTION OF THE OFFERED NOTES--Available Income" and "--Principal Draws."
SERVICER RISK
The appointment of the Servicer under the Master Trust Deed and Servicing
Agreement may be terminated under certain circumstances or the Servicer may
resign (see "DESCRIPTION OF THE SERVICING AGREEMENT"). If the Servicer is
removed for any reason, the Issuer Trustee is obligated to appoint a suitably
qualified person as Servicer whose appointment would not materially prejudice
the interests of Noteholders (an "Eligible Servicer") to assume responsibility
for servicing the Housing Loans in accordance with the Master Trust Deed and the
Servicing Agreement. There is no guarantee (a) that an Eligible Servicer will be
found who would be willing to service the Housing Loans on the terms of the
Master Trust Deed and the Servicing Agreement, in which case the Issuer Trustee
must act as the Eligible Servicer or (b) that an Eligible Servicer will be able
to service the Housing Loans with the same level of skill and competence as the
initial Servicer. The ability of the Eligible Servicer (whether it is the Issuer
Trustee or a third party) to perform the servicing functions under the Master
Trust Deed and Servicing Agreement would depend on the information and records
available to it.
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PRIORITY OF RFSS AND RFS CLASS A NOTES OWNED BY AUSTRALIAN RESIDENT INVESTORS
In certain limited circumstances, the Trust will issue RFSs and RFS Class A
Notes, which will be issued to Australian resident investors only. The RFSs will
be senior to the Class A Notes with respect to payments of principal and which
will rank PARI PASSU with the Class A Notes with respect to Interest. In
addition, on each Payment Date, Gross Principal Collections will be used to
reimburse Westpac for any Redraws funded by Westpac during the related
Collection Period prior to payments to the Class A Notes. Additionally, if RFS,
are not repaid on the fifth Collection Determination Date following the date
such RFSs were issued, such RFSs will convert to RFS Class A Notes. The RFS
Class A Notes will rank PARI PASSU with the Class A Notes with respect to
payments of both principal and Interest. In addition, payments due on the Redraw
Facility, RFSs and RFS Class A Notes, if any, will be senior in right of payment
to the Class B Notes with respect to principal, Interest and fees. If proceeds
from the liquidation of the assets included in the Trust following the
enforcement of the Security Trust Deed are not sufficient to pay all obligations
of the Issuer Trustee in its capacity as trustee of the Trust, Noteholders with
a lower priority of payment are at a greater risk for losses on their
investment. See "DESCRIPTION OF THE OFFERED NOTES--Description of the Redraw
Facility, the Redraw Funding Securities and the RFS Class A Notes."
CREDIT ENHANCEMENT PROVIDES ONLY LIMITED PROTECTION AGAINST LOSSES
Credit enhancement with respect to the Class A Notes will be provided by (i)
the Mortgage Insurance Policies, (ii) subordination of the Excess Available
Income and (iii) the subordination of payments of the Class B Notes to payments
to the Class A Notes. Credit enhancement with respect to the Class B Notes will
be provided by (i) the Mortgage Insurance Policies and (ii) subordination of the
Excess Available Income. Although the credit enhancement is intended to reduce
the risk of delinquent payments or losses to the Noteholders entitled to the
benefit thereof, the amount of such enhancement is limited, will decline and
could be depleted under certain circumstances prior to the payment in full of
the Offered Notes. As a result, the available credit enhancement may be
insufficient to reduce the risk of delinquent payments of losses to the
Noteholders. See "THE MORTGAGE INSURANCE POLICIES" and "DESCRIPTION OF THE
NOTES."
LIMITATIONS ON THE LIQUIDITY SUPPORT
If on any Collection Determination Date, the Available Income of the Trust
is insufficient to meet Total Payments of the Trust for a Collection Period,
Principal Collections collected during such Collection Period may be used to
provide liquidity by way of a Principal Draw. If Principal Draws are not
available to meet Total Payments, a drawing must be made under the Liquidity
Facility up to the Liquidity Limit (as defined herein). In the event that there
are shortfalls in excess of the Liquidity Limit prior to the payment in full of
the Offered Notes, Noteholders may suffer losses. In addition, the Liquidity
Facility is not designed to provide any credit enhancement with respect to the
Offered Notes. See "DESCRIPTION OF THE OFFERED NOTES--Principal Draws" and "THE
LIQUIDITY FACILITY."
EXERCISE OF CLEAN-UP OFFER MAY RESULT IN SHORTFALLS TO NOTEHOLDERS
If at any time the aggregate Housing Loan Principal, expressed as a
percentage of the aggregate Housing Loan Principal as of the Cut-Off Date, is
less than 10%, then, if instructed by the Trust Manager, the Seller Trustee may
repurchase, on the following Payment Date, the equitable title to the Housing
Loans held by the Trust. The proceeds of sale will be applied by the Issuer
Trustee to repay moneys owing to Noteholders at that time in accordance with the
priorities for applying payments of Interest and principal between the Classes
of Notes. In the event that a Housing Loan is non-performing, the purchase price
for such Housing Loan will be based on the Fair Market Value. Fair Market Value
with respect to a Housing Loan may be less than the Unpaid Balance of such
Housing Loan. If a significant number of Housing Loans are non-performing, the
total proceeds from exercising the Clean-up Offer may be less than amounts owing
to Noteholders and Noteholders may suffer losses.
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REDEMPTION OF THE NOTES
If an Event of Default occurs under the Security Trust Deed while the Notes
are outstanding, the Security Trustee may (subject to the prior written consent
of the Note Trustee in accordance with the provisions of the Security Trust
Deed), and will (if so directed by the Note Trustee alone where it is the only
Voting Mortgagee or, otherwise by a resolution of 75% of the Voting Mortgagees)
enforce the security created by the Security Trust Deed. That enforcement can
include the sale of some or all of the Housing Loans. There is no guarantee that
the Security Trustee will be able to sell the Housing Loans for their then
Unpaid Balance. Accordingly, the Security Trustee may not be able to realize the
full value of the Housing Loans and this may have an impact upon the Issuer
Trustee's ability to repay all amounts outstanding in relation to the Notes. Any
proceeds from the enforcement of the security will be applied in accordance with
the order of priority of payments as set out in the Security Trust Deed. See
"SECURITY FOR THE NOTES."
If the Trust terminates while Notes are outstanding, Westpac has a right of
first refusal to acquire the Housing Loans. The price to be paid by Westpac for
performing and non-performing Housing Loans must be not less than their fair
market value. In the case of performing Housing Loans, the Issuer Trustee is
required to offer to sell them to Westpac under its right of first refusal for
their then Unpaid Balance. Where the fair market value of a Housing Loan is less
than its then Unpaid Balance, its acquisition by Westpac will be subject to
prior approval by an Extraordinary Resolution (as defined herein) of
Noteholders. This is because in such circumstances there may be a shortfall in
the amount available to the Issuer Trustee to fully repay all amounts
outstanding in relation to the Notes. See "DESCRIPTION OF THE OFFERED
NOTES--Termination of the Trust."
GEOGRAPHIC CONCENTRATION MAY AFFECT PERFORMANCE
Approximately %, % and % (by Cut-Off Date Principal Balance) of the
Housing Loans are secured by Mortgaged Properties in the regions of New South
Wales, Victoria and Queensland, respectively. To the extent that one or more of
such regions has experienced or may experience in the future weaker economic
conditions or greater rates of decline in real estate values than Australia
generally, such a concentration of the Housing Loans may be expected to increase
the risk of delinquencies and losses on the Housing Loans with respect to such
region. None of the Issuer Trustee, the Approved Sellers nor the Servicer can
quantify the impact of any recent property value declines on the Housing Loans
or predict whether, to what extent or for how long such declines may continue.
CONSUMER CREDIT LEGISLATION
Some of the Housing Loans are regulated by consumer credit legislation (the
"Consumer Credit Legislation"). Under that legislation, a Borrower may have a
right to apply to a court to:
(1) vary the terms of his or her Housing Loan on the grounds of hardship
or that it is an unjust contract;
(2) reduce or cancel any interest rate payable on the Housing Loan which
is unconscionable;
(3) have certain provisions of the Housing Loan or relevant Mortgage
which are in breach of the legislation declared unenforceable; or
(4) obtain restitution or compensation from the Issuer Trustee, in
relation to any breaches of the Consumer Credit Legislation in relation to
the Housing Loan or relevant Mortgage.
Any such order may affect the timing or amount of interest or principal
payments or repayments under the relevant Housing Loan (which might in turn
affect the timing or amount of interest or principal payments or repayments
under the Offered Notes).
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In addition, a mortgagee's ability to enforce a mortgage which is subject to
the Consumer Credit Legislation is limited by various demand and notice
procedures which are required to be followed. For example, as a general rule
enforcement cannot occur unless the relevant default is not remedied within 30
days after a default notice is given. Borrowers may also be entitled to initiate
negotiations with the mortgagee for a postponement of enforcement proceedings.
Such procedures and negotiations may also affect the timing or amount of
interest or principal payments or repayments under the Housing Loans.
Breaches of the Consumer Credit Legislation may also lead to civil penalties
or criminal fines being imposed on Westpac, for so long as it holds legal title
to the Housing Loans and the Mortgages. If the Issuer Trustee acquires legal
title, it will then become primarily responsible for compliance with the
Consumer Credit Legislation. The Issuer Trustee will (subject to limited
exceptions) be indemnified out of the assets of the Trust for its liabilities
under the Consumer Credit Legislation. If the Issuer Trustee is indemnified with
respect to such liabilities out of the assets of the Trust, proceeds of the
Trust may be insufficient to make all payments provided for under the Offered
Notes.
Westpac will give, or has given, certain representations and warranties that
the Housing Loans and related Mortgages comply in all material respects with the
Consumer Credit Legislation in force at the time documents were entered into.
The representation and warranties are set forth in "THE TRUST
FUND--Representations and Warranties." The Servicer has undertaken to comply
with the Consumer Credit Legislation in connection with servicing the Housing
Loans and related Mortgages where failure to do so would have an Adverse Effect.
An "Adverse Effect" is an event which will materially and adversely affect the
amount of any payment to be made to any Noteholder, or will materially and
adversely affect the timing of such payment. In certain circumstances the Issuer
Trustee may have the right to claim damages from Westpac or the Servicer, as the
case may be, where the Issuer Trustee suffers loss in connection with a breach
of the Consumer Credit Legislation which is caused by a breach of a relevant
representation or undertaking. See "CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS."
RISK OF COMMINGLING
Collections under the Housing Loans are received by Westpac or the Servicer.
As described in "DESCRIPTION OF THE OFFERED NOTES--Collections," provided
Westpac has a short term rating of at least "A-1+" from Standard & Poor's, "P-1"
from Moody's and "F-1+" from Fitch and the Collections Account is maintained
with Westpac or a subsidiary of Westpac, neither Westpac nor the Servicer is
required to pay the Collections into the Collections Account until two (2)
Business Days before the relevant Payment Date. If Westpac does not have the
relevant rating, Collections must be paid into the Collections Account within
five (5) Business Days (if the Collection Account is with Westpac or one of its
subsidiaries) or two (2) Business Days (in any other case) following receipt. In
each of these circumstances, the Collections may be commingled with the assets
of the Servicer or Westpac (as the case may be) and, in the event of the
insolvency of Westpac or the Servicer (as relevant), the Issuer Trustee may only
be able to claim those Collections as an unsecured creditor of the insolvent
company.
LIMITED LIQUIDITY
There will be no market for the Offered Notes prior to the issuance thereof,
and there can be no assurance that a secondary market will develop, or if it
does develop, that it will provide the Noteholders with liquidity of investment
or that it will remain for the term of any Notes. The Underwriters presently
expect to make a secondary market in the Offered Notes, but have no obligation
to do so.
RATINGS OF THE NOTES; FACTORS AFFECTING ABILITY TO MAINTAIN RATINGS
It is a condition to the issuance of the Class A Notes that they be rated
"Aaa" by Moody's, "AAA" by Standard & Poor's and "AAA" by Fitch that the Class B
Notes be rated at least "AA-" by Standard & Poor's and "AA-" by Fitch. A rating
is not a recommendation to purchase, hold or sell the Offered Notes,
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inasmuch as such rating does not comment as to market price or suitability for a
particular investor. The rating of the Offered Notes addresses the likelihood of
the payment of principal and interest on the Offered Notes pursuant to their
terms. There is no assurance that a rating will remain for any given period of
time or that a rating will not be lowered or withdrawn entirely by a Rating
Agency if in its judgment circumstances (including without limitation a
reduction in the credit rating of the Interest Rate Swap Provider, the Currency
Swap Providers, the Mortgage Insurance Providers or a reduction in the domestic
currency rating of Australia) in the future so warrant. The ratings of the
Offered Notes will be based primarily on the creditworthiness of the Housing
Loans, the subordination provided by the Class B Notes with respect to the Class
A Notes, the availability of Excess Available Income, if any, the Mortgage Pool
Insurance Policy and the PMI Mortgage Insurance Policies, the availability of
the Liquidity Facility, the creditworthiness of the Interest Rate Swap Provider,
the Currency Swap Providers and the Mortgage Insurer Providers and the domestic
currency rating of Australia. In the context of an asset securitization, the
domestic currency rating of a country reflects, in general, a Rating Agency's
view of the likelihood that cash flow on the assets in such country's currency
will be permitted to be sent outside of that country.
BOOK-ENTRY NOTES
Issuance of the Offered Notes in book-entry form may reduce the liquidity of
such Notes in the secondary trading market since investors may be unwilling to
purchase Offered Notes for which they cannot obtain physical certificates. Since
transactions in the Offered Notes can be effected only through DTC, Cedel,
Euroclear, participating organizations, indirect participants and certain banks,
the ability of a Noteholder to pledge an Offered Note to persons or entities
that do not participate in the DTC, Cedel or Euroclear systems or otherwise to
take actions in respect of such Notes, may be limited due to lack of a physical
certificate representing the Offered Notes. Noteholders may experience some
delay in their receipt of distributions of interest and principal on the Offered
Notes since such distributions will be forwarded by the Note Trustee to DTC and
DTC will credit such distributions to the accounts of its Participants (as
defined herein) which will thereafter credit them to the accounts of Noteholders
either directly or indirectly through indirect participants. See "DESCRIPTION OF
THE OFFERED NOTES-- Book-Entry Registration" herein.
OTHER CONSIDERATIONS
There is no assurance that the market value of the Housing Loans will at any
time be equal to or greater than the Invested Amount of the Notes then
outstanding, plus accrued interest thereon. Moreover, upon an Event of Default
under the Security Trust Deed and a sale of the Trust Assets, the Security
Trustee, the Note Trustee, the Liquidity Facility Provider, the Swap Providers
and any other service provider generally will be entitled to receive the
proceeds of any such sale to the extent of unpaid fees and expenses and other
amounts owing to such persons prior to distributions to holders of the Notes.
After such payment of fees and expenses, the remaining proceeds thereof may be
insufficient to pay in full the principal of and interest on the Notes.
FORMATION OF THE TRUST
WESTPAC SECURITISATION TRUST PROGRAMME
The Westpac Securitisation Trust Programme was established pursuant to the
Master Trust Deed for the purpose of enabling Westpac Securities Administration
Limited as trustee of each Trust established pursuant thereto, to invest in
pools of consumer assets originated from time to time by the Westpac Banking
Corporation group (the "Westpac Group"). The Master Trust Deed provides for the
creation of an unlimited number of WST trusts. Each WST trust will be a separate
and distinct trust fund and will be created subject to the Master Trust Deed and
a supplemental series notice establishing specific provisions of the relevant
WST trust and the instruments to be issued by that trust. The Trust Assets are
not available to meet the liabilities of any other WST trust formed under the
Master Trust Deed. Likewise, the assets of
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any other trust formed under the Master Trust Deed are not available to meet the
liabilities of the Trust Series 1998-1G WST. Multiple classes of notes may be
issued by the Issuer Trustee in relation to each WST trust that differ among
themselves as to priority of payments and ratings.
SERIES 1998-1G WST TRUST
The detailed terms of the Trust will be as set out in the Series Notice and
the Master Trust Deed. The Master Trust Deed establishes the general framework
under which WST trusts may be established from time to time. It does not
actually establish any trusts. To establish a trust, the Trust Manager and the
Issuer Trustee have executed a notice of creation of trust dated (the
"Notice of Creation of Trust").
In order to supplement the general framework under the Master Trust Deed
with respect to the Trust, all relevant parties (including the Trust Manager,
the Issuer Trustee and each Approved Seller) will execute the Series Notice,
which (among other things) specifies the details of the Notes, establishes the
cashflow allocation, sets out various representations and undertakings of the
parties specific to the Housing Loans, which are additional to those in the
Master Trust Deed, and amends the Master Trust Deed to the extent necessary to
give effect to the specific aspects of the Trust and the issue of the Notes.
The Transaction Documents should therefore be read together when determining
the rights, powers and obligations of the Issuer Trustee, the Trust Manager and
the Approved Sellers in relation to the Trust. Forms of the Master Trust Deed
and the Series Notice have been filed as exhibits to the Registration Statement
of which this Prospectus is a part. The summaries herein do not purport to be
complete and are subject to the provisions of such documents.
The issuance of the Notes will fund the purchase by the Trust of a pool of
residential housing loans originated by Westpac, which will be specified in a
Sale Notice from each of Westpac in its capacity as originator of the Housing
Loans or Westpac Securities Administration Limited in its capacity as trustee of
any other WST trusts established under the Master Trust Deed (in that capacity,
the "Seller Trustee"). The Seller Trustee owes a fiduciary duty to Westpac, the
entity which is the beneficiary of each "warehouse" trust established under the
Master Trust Deed.
In addition, the Trust may issue certain additional debt securities as
discussed herein under "DESCRIPTION OF THE OFFERED NOTES--Description of the
Redraw Facility, the Redraw Funding Securities and the RFS Class A Notes."
TRUST ASSETS
The Trust Assets will include:
1. a pool of Housing Loans, including all monies at any time paid or
payable thereon or in respect thereof from and after the Cut-Off Date with
respect to payments of principal and after the Closing Date with respect to
payments of interest;
2. rights under certain insurance policies with respect to the Housing
Loans;
3. amounts on deposit in certain accounts established pursuant to the
Master Trust Deed, including the Collections Account, and amounts invested
in Authorized Investments; and
4. the Issuer Trustee's rights under the Transaction Documents.
SECURITY FOR THE NOTES
CHARGE
Under the Security Trust Deed, dated , 1998 among the Issuer Trustee,
the Trust Manager, the Note Trustee and the Security Trustee, the Issuer Trustee
will grant a first ranking floating charge, to be registered with the Australian
Securities Commission, over all of the Trust Assets in favor of Perpetual
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Trustee Company Limited (ACN 000 001 007) (the "Security Trustee"), a company
within the Perpetual group with its holding company being Perpetual Trustees
Australia Limited (ACN 000 431 827), in order to secure the Issuer Trustee's
obligations to the Noteholders, the Note Trustee, the Trust Manager, the
Interest Rate Swap Provider, the Currency Swap Providers, the Security Trustee,
each Paying Agent and each other provider of a Support Facility (other than any
provider of a Mortgage Insurance Policy) to the Issuer Trustee, any Accrued
Interest Adjustment (as defined herein) owed to an Approved Seller, to Westpac
in respect of Redraws and to the holders of the RFSs (if any) and the holders of
the RFS Class A Notes (if any) (such creditors, together the "Mortgagees").
SECURITY TRUSTEE
The Security Trustee is appointed to act as trustee on behalf of the
Mortgagees on the terms and conditions of the Security Trust Deed. It holds the
benefit of the charge over the secured property (as defined herein) and the
benefit of each of the Transaction Documents to which the Issuer Trustee is a
party in trust for each Mortgagee in accordance with the terms and conditions of
the Security Trust Deed.
If there is a conflict between the duties owed by the Security Trustee to
any Mortgagees or class of Mortgagees, the Security Trustee must give priority
to the interests of the holders of the RFSs (if any) and the RFS Class A Notes
(if any) and the Class A Noteholders and the Class B Noteholders (which in the
case of the Class A Noteholders and the Class B Noteholders shall be determined
by the Note Trustee acting on their behalf). Subject to the provisions of the
Security Trust Deed (other than the provision in the previous sentence), the
Security Trustee must give priority to the interests only of the Class A
Noteholders and the holders of the RFSs (if any) and the holders of the RFS
Class A Notes (if any) if, in the Security Trustee's opinion, there is a
conflict between the interests of Class A Noteholders and the holders of the
RFSs (if any) and the holders of the RFS Class A Notes (if any) and the
interests of the Class B Noteholders or other Mortgagees. Provided that the
Security Trustee acts in good faith, it shall not incur any liability to any
Mortgagee for giving effect or seeking to give effect to the preceding
provisions of this paragraph.
The Security Trustee has had no involvement in the preparation of any part
of this Prospectus, other than the particular reference to the Security Trustee
in this section and the disclosure of additional provisions of the Security
Trust Deed set forth herein. The Security Trustee makes no statement or
representation in this Prospectus, has not authorized or caused the issue of any
part of it and takes no responsibility for any part of it.
NATURE OF SECURITY
If a company grants a fixed security over any of its assets, those assets
may not be dealt with by the company without the consent of the relevant
mortgagee. In this way, the security is said to "fix" over the specific assets.
Fixed securities are usually given over real property, marketable securities and
other assets which will not be dealt with by the company.
Unlike fixed securities, floating charges do not attach to specific assets
but instead "float" over a class of assets which may change from time to time,
allowing the person or entity granting the charge (the "Chargor") to deal with
those assets and to give third parties title to those assets free from any
encumbrance in the event of sale, discharge or modification, for example. The
security created by the Security Trust Deed is a floating charge over the Trust
Assets. The Security Trust Deed provides that the Issuer Trustee may not deal
with the assets of the Trust subject to the floating charge, except in the
ordinary course of its business. It is common in Australia for special purpose
securitization vehicles to give floating charges rather than fixed charges. If
the Issuer Trustee disposes of any of the Trust Assets (including any Housing
Loan) in the ordinary course of its business, the acquirer of that property will
take them free of the floating charge.
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The floating charge created by the Security Trust Deed may "crystallize" and
become a fixed charge over the relevant class of assets owned by the Issuer
Trustee at the time of crystallization. Crystallization will occur automatically
following the occurrence of specific events set out in the Security Trust Deed,
including, among other events, notice to the Issuer Trustee from the Security
Trustee following an event of default. See "CERTAIN LEGAL ASPECTS OF THE HOUSING
LOANS" and "APPENDIX I-- GLOSSARY OF AUSTRALIAN LEGAL TERMS" herein.
ENFORCEMENT
[The Security Trustee must promptly convene a meeting of the Voting
Mortgagees (as defined herein) after it receives notice, or has actual knowledge
of, an Event of Default (as defined herein). See "DESCRIPTION OF THE OFFERED
NOTES--Events of Default; Rights Upon Event of Default." The Security Trustee
may waive (such waiver, being subject to the prior written consent of the Note
Trustee in accordance with the provisions of the Security Trust Deed), an Event
of Default before it is required to convene a meeting of Mortgagees if that
Event of Default is not (in the opinion of the Security Trustee) materially
prejudicial to the Mortgagees' interests.]
[At the meeting, the Voting Mortgagees must vote by Extraordinary Resolution
(being a resolution passed at a duly convened meeting by a majority consisting
of not less than 75% of the votes capable of being cast by Voting Mortgagees
present in person or by proxy or by written resolution signed by all of the
Voting Mortgagees)] on whether to direct the Security Trustee to:
(1) declare the charge to be enforceable;
(2) declare the Secured Moneys immediately due and payable;
(3) crystallize the floating charge created under the Security Trust
Deed in relation to any or all of the Secured Property (for a description of
the crystallization process, see "--Nature of Security" above); and/or
(4) appoint a receiver over the Trust's assets or itself exercise the
powers that a receiver would otherwise have under the Security Trust Deed.
"Secured Moneys" means all money which the Issuer Trustee (whether alone or
with another person) is or at any time may become actually or contingently
liable to pay to or for the account of any Mortgagee (whether alone or with
another person) for any reason whatever under or in connection with a
Transaction Document.
[With respect to voting, every person who is present at a meeting shall have
one vote in respect of each US$ in principal amount of the Stated Amount of the
Offered Notes then outstanding of the Class A Notes or the Class B Notes, as the
case may be, so produced or represented by the voting certificate so produced or
in respect of which he is a proxy.]
The Security Trustee cannot exercise the powers referred to above unless
directed by an Extraordinary Resolution in the manner outlined above. The
Security Trustee is not obligated to act unless it obtains an indemnity from the
Voting Mortgagees, and funds have been deposited on behalf of the Security
Trustee to the extent to which it may become liable for the relevant enforcement
actions. For so long as the Note Trustee is the only Voting Mortgagee it may
direct the Security Trustee to do any act which the Security Trustee is required
to do, or may only do, at the direction of an Extraordinary Resolution of Voting
Mortgagees. [Neither the Security Trustee nor the Trust Manager may call a
meeting of Voting Mortgagees while the Note Trustee is the only Voting
Mortgagee, unless the Note Trustee otherwise consents.]
The Note Trustee will be the only Voting Mortgagee for so long as the
amounts outstanding under the Notes are 75% or more of all amounts secured by
the Security Trust Deed.
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For the purposes of the Security Trust Deed and the Note Trust Deed, a
reference to Class A Noteholders include RFS Class A Noteholders, if any.
No Mortgagee is entitled to enforce the charge under the Security Trust
Deed, or appoint a receiver or otherwise exercise any power conferred by any
applicable law on charges, other than in accordance with the Security Trust
Deed.
PRIORITIES UNDER THE SECURITY TRUST DEED
The proceeds from the enforcement of the Security Trust Deed (which will not
include amounts required by law to be paid to the holder of any prior ranking
security interest, the proceeds of or amounts credited to the collateral account
under the Liquidity Facility and payable to the Liquidity Facility Provider and
the proceeds of cash collateral lodged with and payable to a provider of a Swap
Agreement or provider of another Support Facility to the Issuer Trustee) are to
be applied in the order of priority set forth below, subject to any other
priority which may be required by statute or law. Priority of proceeds in
enforcement over secured creditors includes certain federal taxes, unpaid wages,
long service leave, annual leave and similar employee benefits and certain
auditor's fees.
(1) first, to pay all costs, charges, expenses and disbursements
properly incurred in the exercise of any power by the Security Trustee, the
Note Trustee, a receiver or an attorney or other amounts (other than those
referred to in paragraph (4) below) payable to the Security Trustee or the
Note Trustee under the Security Trust Deed;
(2) second, to pay pro rata based on their respective entitlements:
(i) any fees and other expenses (including Trust Expenses) due to the
Security Trustee, the Note Trustee or the Principal Paying Agent;
(ii) any fees and unpaid expenses, due to the Issuer Trustee; and
(iii) the receiver's remuneration;
(3) third, to pay pro rata any unpaid Accrued Interest Adjustment due to
an Approved Seller;
(4) fourth, to pay pro rata based on their respective entitlements:
(i) all Secured Moneys (as defined herein) owing to the providers of
each Support Facility (other than the Currency Swap Providers);
(ii) all Secured Moneys owing to the holders of RFSs (if any);
(iii) all Secured Moneys owing to the holders of RFS Class A Notes (if
any);
(iv) all the Secured Moneys owing to the Class A Noteholders (as at the
date of payment);
(v) all Secured Moneys owed by the Issuer Trustee as trustee of the
Trust to a WST trust other than the Trust;
(vi) all Secured Moneys owing in relation to any Redraws made by Westpac
for which it has not been reimbursed under the Transaction Documents; and
(vii) all Secured Moneys owing to the Currency Swap Providers under a
confirmation relating to Class A Notes (but without double counting with
payments under sub-paragraph (iv));
(5) fifth, all Secured Moneys owing to the Class B Noteholders (as at
the date of payment) and to the Currency Swap Providers under a confirmation
relating to the Class B Notes, but without double counting;
(6) sixth, to pay (PARI PASSU and rateably) any amounts not covered
above owing to any Mortgagee under any Transaction Document;
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(7) seventh, to pay the holder of any subsequent security interest over
the assets charged by the Security Trust Deed of which the Security Trustee
has notice of the amount properly secured by the security interest;
(8) eighth, to pay any surplus to the Issuer Trustee to be distributed
in accordance with the Master Trust Deed.
The surplus will not carry interest. If the Security Trustee pays the
surplus to the credit of an account in the name of the Issuer Trustee with any
bank carrying on business in Australia, the Security Trustee, receiver,
Mortgagee or attorney (as the case may be) will be under no further liability in
respect of it.
The "Accrued Interest Adjustment" represents interest and fees which have
accrued on the relevant Housing Loans but which are unpaid as at (and excluding)
the Closing Date, and all amounts received by the relevant Approved Seller under
those Housing Loans applied by the Servicer to payment of interest and fees
under those Housing Loans for the period from (but excluding) the Cut-Off Date
to (but excluding) the Closing Date. During the period between the Cut-Off Date
and the Closing Date, the Housing Loans continue to be owned by the Approved
Sellers. However, any Collections with respect to the period from the Cut-Off
Date through the Closing Date will not be paid back to Westpac until after the
assignment of the Housing Loans to the Trust. The purchase price for the Housing
Loans excludes any such accrual. Therefore, an amount equal to that accrued
interest and fees and Collections in respect of interest and fees for the period
between the Cut-Off Date and the Closing Date will be paid to the Approved
Sellers on the first Payment Date as a priority payment from Total Available
Funds.
SECURITY TRUSTEE'S FEES AND EXPENSES
The Issuer Trustee shall reimburse the Security Trustee for all costs and
expenses of the Security Trustee properly incurred in acting as Security
Trustee. The Security Trustee shall be entitled to a fee payable quarterly (the
"Security Trustee Fee") in the amount agreed from time to time by the Issuer
Trustee, the Security Trustee and the Trust Manager. The Issuer Trustee has
agreed to indemnify the Security Trustee against any loss, cost, charge,
liability, expense or damage under or in relation to the Transaction Documents,
except where arising from the Security Trustee's fraud, negligence or willful
default.
RETIREMENT AND REMOVAL
Subject to the appointment of a successor Security Trustee, the Security
Trustee may retire on three months' notice in writing to the Issuer Trustee, the
Trust Manager, the Note Trustee and the Rating Agencies. The Security Trustee
may resign in favor of a successor Security Trustee only if the Rating Agencies
confirm that such resignation will not cause a withdrawal, downgrade or
qualification of the ratings of the Offered Notes.
Subject to the appointment of a successor Security Trustee and prior notice
being given to each of the Rating Agencies, an Extraordinary Resolution of the
Voting Mortgagees may at any time remove the Security Trustee.
Subject to the appointment of a successor Security Trustee and prior notice
being given to each of the Rating Agencies, the Trust Manager may remove the
Security Trustee if any of the following occurs in relation to the Security
Trustee: (i) an Insolvency Event occurs in relation to the Security Trustee in
its personal capacity; (ii) the cessation by the Security Trustee of its
business; (iii) the failure by the Security Trustee to remedy within 14 days
after written notice by the Trust Manager any material breach of duty on the
part of the Security Trustee; or (iv) if without the prior written consent of
the Trust Manager there occur certain changes in the control or management of
the Security Trustee.
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Upon notice of resignation or removal of the Security Trustee, the Trust
Manager has the right to appoint a successor Security Trustee who has been
previously approved by an Extraordinary Resolution of the Voting Mortgagees and
who accepts the appointment. If no successor Security Trustee is appointed
within 30 days after notice, the retiring Security Trustee may on behalf of the
Mortgagees appoint a successor Security Trustee (other than Westpac or a related
corporation of Westpac) who accepts the appointment. There are currently several
third party security trustee organizations in Australia which may be available
to replace a resigning or removed security trustee.
ADDITIONAL PROVISIONS OF THE SECURITY TRUST DEED
The Security Trust Deed may be amended by the Issuer Trustee and the
Security Trustee with the written approval of the Trust Manager and the Note
Trustee in the manner (and subject to the restrictions) set out in the Security
Trust Deed.
The Security Trust Deed contains a range of provisions regulating the scope
of the Security Trustee's duties and liability. These include the following:
(1) The Security Trustee is not responsible for the adequacy or
enforceability of the Security Trust Deed or other Transaction Documents.
(2) The Security Trustee is not required to exercise its powers under
the Security Trust Deed without being directed to do so by the Note Trustee
or by an Extraordinary Resolution (as referred to above) of the Voting
Mortgagees.
(3) The Security Trustee may rely on documents provided by the Issuer
Trustee or Trust Manager and the advice of consultants and advisors.
(4) The Security Trustee is not required to monitor whether an event of
default has occurred or compliance by the Issuer Trustee or Trust Manager
with the Transaction Documents, or their other activities.
(5) The Security Trustee is not required to do anything unless its
liability is limited in a manner satisfactory to it.
(6) The Security Trustee need not give Mortgagees information concerning
the Issuer Trustee which comes into the possession of the Security Trustee.
(7) The rights, remedies and discretion of the Noteholders including all
rights to vote or give instructions or consents to the Security Trustee and
to enforce its undertakings and warranties may only be exercised by the Note
Trustee on behalf of the Class A and Class B Noteholders and the Security
Trustee may rely on any instructions or directions given to it by Note
Trustee as being given on behalf of the Noteholders without enquiry about
compliance with the Note Trust Deed.
(8) The Security Trustee has no duties or responsibilities except those
expressly set out in the Security Trust Deed or any collateral security.
(9) Any action taken by the Security Trustee under the Security Trust
Deed or any collateral security binds all the Mortgagees.
(10) Each Mortgagee must make its own independent investigations,
without reliance on the Security Trustee, as to the affairs of the Issuer
Trustee and whether or not to take action under any Transaction Document.
(11) The Security Trustee in its capacity as a Mortgagee can exercise
its rights and powers as such as if it were not acting as the Security
Trustee. It and its affiliates may engage in any kind of business with the
Issuer Trustee, the Trust Manager, Mortgagees and others as if it were not
Security Trustee and may receive consideration for services in connection
with any Transaction Document or otherwise without having to account to the
Mortgagees.
49
<PAGE>
THE TRUST FUND
GENERAL
The Housing Loans are expected to include Housing Loans secured by
registered first ranking mortgages (collectively, the "Mortgages") on Mortgaged
Properties located in Australia. This subsection describes generally the
characteristics of the Housing Loans. The Mortgaged Properties consist of owner-
occupied properties and investment properties. The Mortgaged Properties do not
include mobile homes which are not permanently affixed to the ground, commercial
properties or unimproved land. With respect to each Housing Loan, the "Cut-Off
Date Balance Outstanding" is the unpaid principal balance of such Housing Loan
as of the close of business on the Cut-Off Date. Housing Loans included in the
Trust Fund consist of floating and fixed rate loans originated by Westpac.
TRANSFER AND ASSIGNMENT OF HOUSING LOANS
On the Closing Date, the Housing Loans purchased by the Trust will be those
specified in a Sale Notice from each of the Approved Sellers to the Issuer
Trustee. The Housing Loans to be sold by either the Seller Trust or by Westpac
from Westpac's general portfolio of residential Housing Loans have been in both
cases originated by Westpac in the ordinary course of its business. Each Housing
Loan may have some or all of the product features set out in "WESTPAC
RESIDENTIAL LOAN PROGRAM--Housing Loan Features" below. The Housing Loans are,
generally, required to be secured by a registered first ranking real property
mortgage and, in certain circumstances, there may also be a second ranking
mortgage in favor of Westpac. For more information on the Housing Loans, see
"WESTPAC RESIDENTIAL LOAN PROGRAM" below.
On the Closing Date, the Approved Sellers will equitably assign the Housing
Loans, the Mortgages and the Related Securities (as defined herein) securing
those Housing Loans to the Issuer Trustee, pursuant to the Sale Notices
substantially in the form annexed to the Master Trust Deed, after which the
Issuer Trustee will be entitled to receive (with the assistance of TMC in its
capacity as servicer (the "Servicer") of the Housing Loans and custodian of
Related Documents (as defined herein), including the mortgage documents relating
to the Housing Loans) Collections on the Housing Loans. If a Title Perfection
Event occurs, the Issuer Trustee must, with the assistance of the Trust Manager
and Westpac, take certain actions to perfect its legal title in the Housing
Loans pursuant to an irrevocable power of attorney granted by Westpac.
"Related Security" in relation to a Housing Loan means: (a) any Relevant
Document for that Housing Loan; (b) any insurance policy or insurance proceeds
with respect to the Housing Loan; (c) any Mortgage Insurance Policy or Mortgage
Insurance Proceeds with respect to the Housing Loan; or (d) any other agreement
specified as "Related Security" for the Housing Loan in the Series Notice.
"Relevant Document" means, with respect to a Housing Loan, (a) the loan
agreement relating to that Housing Loan; (b) the mortgage document in relation
to such Housing Loan, (c) the certificate of title for the Mortgaged Property
secured by such mortgage, (d) any amendment or replacement of such documents and
any other document which is entered into by or executed in favor of the Approved
Seller or Issuer Trustee in connection with that Housing Loan after the Cut-Off
Date, or (e) any other document specified as a "Relevant Document" in the Series
Notice.
An Approved Seller may in some instances assign to the Issuer Trustee a
Housing Loan secured by an "all moneys" Mortgage, which may also secure
financial indebtedness that has not been sold into the Mortgage Pool and is
instead retained by Westpac. The Issuer Trustee will hold the benefit of the
relevant Mortgage as bare trustee in relation to that other financial
indebtedness, although the Mortgage will secure the assigned Housing Loan in
priority to that other financial indebtedness.
50
<PAGE>
REPRESENTATIONS AND WARRANTIES
Westpac will make certain representations and warranties to the Issuer
Trustee in relation to the Housing Loans to be assigned by it to the Issuer
Trustee. Westpac also made representations and warranties in relation to the
Housing Loans to be sold by the Seller Trustee at the time those Housing Loans
were first transferred by Westpac to each relevant Seller Trustee, and the
benefit of those prior representations and warranties will be passed on to the
Issuer Trustee. The Servicer will make certain representations and warranties to
the Issuer Trustee in relation to the servicing of the Housing Loans to be sold
by the Seller Trustee to the Issuer Trustee. These representations and
warranties cover the period from when those Housing Loans were first transferred
by Westpac to other Seller Trusts until the Cut-Off Date. The Seller Trustee
will make certain limited representations and warranties in relation to the
Housing Loans to be assigned by it (e.g., as to title) to the Issuer Trustee.
WESTPAC REPRESENTATIONS
Westpac will make the following representations and warranties with respect
to each Housing Loan as of the Cut-Off Date and (except as specified below) the
Closing Date:
(1) it is subject to a Mortgage Insurance Policy;
(2) it is the sole legal and beneficial owner of each Housing Loan, free
and clear of any security interest (unless arising solely as a result of
action by the Security Trustee);
(3) in relation to the Housing Loans to be sold by Westpac to the Issuer
Trustee as at the Cut-Off Date, each Housing Loan satisfies the following
eligibility criteria ("Eligibility Criteria"):
(i) it was approved and originated in the ordinary course of its
business;
(ii) the Mortgage securing each Housing Loan constitutes (a) a
registered first ranking mortgage over residential property, or (b) where
the Mortgage is not, or will not be when registered, a first ranking
mortgage, Westpac has made an offer to the Issuer Trustee in relation to all
prior ranking registered mortgages to sell such Mortgages to the Issuer
Trustee and upon such sale, the Mortgage will constitute a registered first
ranking mortgage;
(iii) it is denominated and payable only in Australian dollars in
Australia;
(iv) it has an LVR less than or equal to 95%;
(v) it has less than A$750,000.00 outstanding under it;
(vi) it is repayable within 30 years of the Cut-Off Date;
(vii) it is not Delinquent for more than 30 consecutive days;
(viii) it is subject to the terms and conditions of a Premium Option Home
Loan, a First Option Home Loan, a Basic Option Home Loan, a Fixed Options
Home Loan, a Special Offer Fixed Option Home Loan, a Fixed Rate Investment
Property Loan, an Investment Property Loan earning a variable rate of
interest, a Special Offer Fixed Rate Investment Property Loan or any other
similar loan product, however named, with some or all of the features
referred to under "WESTPAC RESIDENTIAL LOAN PROGRAM--Housing Loan Features";
(ix) it is secured by a Mortgage over a Mortgaged Property which has
erected on it a residential dwelling;
(x) the sale of an equitable interest in the Housing Loan, or the sale
of an equitable interest in any related Mortgage for the Housing Loan, does
not contravene or conflict with any law;
(xi) together with the related Mortgage, it has been or will be stamped,
or has been taken by the relevant stamp duties authority to be stamped, with
all applicable duty;
51
<PAGE>
(xii) it is not governed or regulated by the Credit Act 1984 (NSW) (or
the corresponding legislation for any other Australian jurisdiction) or any
rural, primary production, moratorium or mediation legislation, other than
the Consumer Credit Legislation;
(xiii) it is not a loan with an interest only payment type and a bullet
principal repayment at the end of the interest only period as set out in the
letter of offer relating to that Housing Loan; and
(xiv) the Borrower is a resident of Australia; and
(4) at the time each Housing Loan and Mortgage which is specified in the
Sale Notice and each Related Security was entered into it complied in all
material respects with applicable laws, including, without limitation, where
the Consumer Credit Legislation applies, the Consumer Credit Legislation.
SERVICER REPRESENTATIONS
In relation to the Housing Loans to be sold by the Seller Trustee to the
Issuer Trustee, the Servicer has made representations and warranties for the
benefit of the Issuer Trustee including that:
(1) as of the Cut-Off Date, each Housing Loan meets the Eligibility
Criteria;
(2) each Housing Loan is the subject of a Mortgage Insurance Policy; and
(3) each Housing Loan originally sold to the Seller Trustee, has been
serviced by the Servicer in accordance with the Servicing Agreement, in some
cases as the Servicing Agreement has been amended, until the Closing Date.
That servicing includes, without limitation, ensuring compliance with the
Consumer Credit Legislation in connection with servicing the Housing Loans
where failure to do so would have an Adverse Effect.
SELLER TRUSTEE REPRESENTATIONS
In relation to the Housing Loans to be sold by the Seller Trustee to the
Issuer Trustee, the Seller Trustee will make representations and warranties for
the benefit of the Issuer Trustee including that:
(1) it has good equitable title to the Housing Loans free and clear of
any security interest other than under the Security Trust Deed given by the
Seller Trustee in favor of the Security Trustee in respect of the warehouse
trust. That Security Trust Deed created only a floating charge over the
Housing Loans; and
(2) the sale, transfer and assignment of the Seller Trustee's interest
in the Housing Loans will not constitute a breach of any documents binding
on the Seller Trustee.
GENERAL
The Issuer Trustee has not investigated or made any inquiries regarding the
accuracy of the representations and warranties, and under the Master Trust Deed
is under no obligation to do so. The Issuer Trustee is entitled to rely entirely
upon the representations and warranties being correct (unless it has actual
notice of any event to the contrary). The rights of the Issuer Trustee in
respect of any representation or warranty being incorrect are described in
"--Breach of Representations" below.
BREACH OF REPRESENTATIONS AND WARRANTIES
If Westpac, the Trust Manager or the Issuer Trustee becomes aware within 120
days after the Closing Date that a representation or warranty from Westpac
relating to any Housing Loan or Mortgage is incorrect, it must notify the other
parties and the Rating Agencies within five Business Days of becoming so aware.
If such a notice in relation to a breach is given not later than five Business
Days before 120 days after the Closing Date and the breach is not waived or
remedied to the satisfaction of the Issuer Trustee within five Business Days
then, without any action being required by either party, Westpac shall be
52
<PAGE>
obligated to repurchase the affected Housing Loan and Mortgage for an amount
equal to its Unpaid Balance.
On payment of that amount the Issuer Trustee shall cease to have any
interest in the affected Housing Loan and Mortgage, and Westpac shall hold both
the legal and beneficial interest in such Housing Loan and Mortgage and be
entitled to all interest and fees that accrue in respect of them from (and
including) the date of repurchase.
In any other case, the Issuer Trustee's rights in relation to a breach of a
representation or warranty shall give rise only to a claim for damages, limited
to an amount equal to the Unpaid Balance of that Housing Loan at the time
Westpac pays the damages.
HOUSING LOAN STATISTICS
The Housing Loans will consist of Housing Loans secured by Mortgages
on Mortgaged Properties located in the six states and two territories in
Australia, being New South Wales ("NSW"), Victoria ("Vic"), Queenslands ("QLD"),
South Australia ("SA"), Western Australia ("WA"), Tasmania ("TAS"), Northern
Territory ("NT") and the Australian Capital Territory ("ACT"). 100% of the
Housing Loans by Cut-Off Date Balances Outstanding are secured by first ranking
mortgages on the related Mortgaged Properties. The aggregate Cut-Off Date
Balances Outstanding of the Housing Loans (the "Cut-Off Date Pool Balance")
totaled approximately A$ . The Housing Loans bear interest at variable and
fixed rates. As of the Cut-Off Date, % of the Housing Loans by Cut-Off Date
Loan Balance are variable rate loans (the "Variable Rate Housing Loans") and
% of the Housing Loans by Cut-Off Date Loan Balance are fixed rate loans (the
"Fixed Rate Housing Loans"). The weighted average Mortgage Rate for the Fixed
Rate Housing Loans as of the Cut-Off Date was approximately % per annum. The
weighted average Mortgage Rate for the Variable Rate Housing Loans as of the
Cut-Off Date was approximately % per annum. The lowest Cut-Off Date Balance
Outstanding of any Housing Loan was approximately A$ and the highest was
approximately A$ . The average Cut-Off Date Balance Outstanding of the
Housing Loans was approximately A$ . The weighted average original term to
stated maturity of the Housing Loans was approximately months. The
weighted average remaining term to stated maturity of the Housing Loans was
approximately months. As of the Cut-Off Date, the weighted average number
of months that have elapsed since origination of the Housing Loans was
approximately months. The lowest and highest LVR of the Housing Loans at
origination were approximately % and %, respectively. The weighted average
LVR of the Housing Loans was approximately %.
Housing Loans representing approximately % of the Cut-Off Date Pool
Balance are secured by Mortgaged Properties which are investment properties
(based solely upon statements made by the related Mortgagors at the time of
origination of the related Housing Loans).
As of the Cut-Off Date, no Housing Loans were greater than 30 days
Delinquent.
Set forth below is a description of certain additional characteristics with
respect to the Housing Loans held by the Trust and are not indicative of the
entire portfolio of Westpac. All percentages are approximate and may not total
100% due to rounding.
53
<PAGE>
(ALL AMOUNTS EXPRESSED IN AUSTRALIAN DOLLARS)
(ALL %'S ARE APPROXIMATE AND MAY NOT TOTAL 100% DUE TO ROUNDING)
BALANCE OUTSTANDING DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
BALANCE OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
A$10,001-A$20,000.................
A$20,001-A$30,000.................
A$30,001-A$40,000.................
A$40,001-A$50,000.................
A$50,001-A$100,000................
A$100,001-A$150,000...............
A$150,001-A$200,000...............
A$200,001-A$250,000...............
A$250,001-A$300,000...............
A$300,001-A$350,000...............
A$350,001-A$400,000...............
A$400,001-A$450,000...............
A$450,001-A$500,000...............
Above A$500,000...................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
LOAN RATES OF THE FIXED RATE HOUSING LOANS AS OF THE CUT-OFF DATE
<TABLE>
<CAPTION>
LOAN RATE(%) NUMBER OF LOANS % BY BALANCE
- ------------------------------------------------------------- ---------------- -----------------
<S> <C> <C>
6.001-6.500%.................................................
6.501-7.000%.................................................
7.001-7.500%.................................................
7.501-8.000%.................................................
8.001-8.500%.................................................
8.501-9.000%.................................................
9.001-9.500%.................................................
9.501-10.000%................................................
10.001-10.500%...............................................
10.501-11.000%...............................................
11.001-11.500%...............................................
11.501-12.000%...............................................
12.001-12.500%...............................................
12.501-13.000%...............................................
13.001-13.500%...............................................
13.501-14.000%...............................................
------- ---
Total....................................................
------- ---
------- ---
</TABLE>
- ------------------------
* Each Fixed Rate Housing Loan can convert to a Variable Rate Housing Loan
subject to certain related penalties.
54
<PAGE>
GEOGRAPHIC DISTRIBUTION BY REGION*
<TABLE>
<CAPTION>
TOTAL
NUMBER SECURITY CURRENT AVERAGE AVERAGE % BY % BY
REGION OF LOANS VALUE A$ BALANCE A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ACT-Metro.........................
NSW-Metro.........................
NSW-Other.........................
NT-Metro..........................
NT-Other..........................
QLD-Metro.........................
QLD-Other.........................
SA-Metro..........................
SA-Other..........................
TAS-Metro.........................
TAS-Other.........................
Vic-Metro.........................
Vic-Other.........................
WA-Metro..........................
WA-Other..........................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
- ------------------------
* Geographic distributions are split by State or Territory and by metropolitan
(Metro) or country (Other). The distributions are based on the post code of
the Mortgaged Property. "Metro" areas comprise the city and surrounding
suburbs of the capital city of each State or Territory and "Other" comprises
all other areas within the State or Territory.
LVR RATIO DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
LVR OF LOANS VALUE A$* OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
0% less than= 5%.................
5% less than= 10%.................
10% less than= 15%................
15% less than= 20%................
20% less than= 25%................
25% less than= 30%................
30% less than= 35%................
35% less than= 40%................
40% less than= 45%................
45% less than= 50%................
50% less than= 55%................
55% less than= 60%................
60% less than= 65%................
65% less than= 70%................
70% less than= 75%................
75% less than= 80%................
80% less than= 85%................
85% less than= 90%................
90% less than= 95%................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
- ------------------------
* Total Security Value is determined by either contract of sale, valuation by
a registered panel valuer or in remote areas, a Manager's Assessment. See
"WESTPAC RESIDENTIAL LOAN PROGRAM--Underwriting of Housing Loans."
55
<PAGE>
MORTGAGE INSURER DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
INSURER OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
None..............................
HLIC (post 12/12/97)..............
HLIC (prior to 12/12/97)..........
MGICA.............................
Sun Alliance/WLMI.................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
PRODUCT DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
PRODUCT OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- --------------------------------- ----------- --------- -------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic Option
Home Loan......................
First Option
Home Loan......................
Fixed Options
Home Loan........................
IPL--First Option................
IPL--Fixed Rate..................
IPL--Special
Fixed Rate.....................
IPL--Variable Rate...............
Premium Option
Home Loan......................
Special Options Fixed
Rate Home Loan.................
----- --------- ------- ----------- --- --- ---
Total........................
----- --------- ------- ----------- --- --- ---
----- --------- ------- ----------- --- --- ---
</TABLE>
56
<PAGE>
SETTLEMENT PERIOD DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT
SETTLEMENT NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
PERIOD OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
<TABLE>
<CAPTION>
MONTH/YEAR OF CONVERSION FROM CURRENT
FIXED RATE HOUSING LOAN TO BALANCE % BY
VARIABLE RATE HOUSING LOAN NUMBER OF LOANS OUTSTANDING A$ BALANCE
- ---------------------------------------------------------------- ---------------- -------------- -----------------
<S> <C> <C> <C>
------- ------- ---
Total.......................................................
------- ------- ---
------- ------- ---
</TABLE>
57
<PAGE>
MORTGAGES BY YEAR OF MATURITY
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
YEAR OF MATURITY OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
1999..............................
2000..............................
2001..............................
2002..............................
2003..............................
2004..............................
2005..............................
2006..............................
2007..............................
2008..............................
2009..............................
2010..............................
2011..............................
2012..............................
2013..............................
2014..............................
2015..............................
2016..............................
2017..............................
2018..............................
2019..............................
2020..............................
2021..............................
2022..............................
2023..............................
2024..............................
2025..............................
2026..............................
2027..............................
2028..............................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
YEAR OF ORIGINATION (QUARTERLY)
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
ORIGINATION OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
OCCUPANCY OF MORTGAGE PROPERTY DISTRIBUTION*
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
LOAN TYPE OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment........................
Owner Occupied....................
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
- ------------------------
* Based solely on statements of Mortgagors at time of origination.
58
<PAGE>
PAYMENT TYPE DISTRIBUTION
<TABLE>
<CAPTION>
CURRENT
TOTAL BALANCE AVERAGE
NUMBER SECURITY OUTSTANDING BALANCE AVERAGE % BY % BY
PAYMENT TYPE OF LOANS VALUE A$ A$ A$ LVR (%) NUMBER BALANCE
- ---------------------------------- ----------- ----------- --------------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Interest Only.....................
Principal & Interest..............
----- ----------- ------- ----------- --- --- ---
Total.........................
----- ----------- ------- ----------- --- --- ---
----- ----------- ------- ----------- --- --- ---
</TABLE>
HOUSING LOAN PROPERTY TYPES
<TABLE>
<CAPTION>
TOTAL CURRENT
NUMBER SECURITY BALANCE % BY
PROPERTY TYPE OF LOANS VALUE OUTSTANDING A$ BALANCE
- ------------------------------------------------------------------ ----------- ----------- --------------- -----------
<S> <C> <C> <C> <C>
Detached houses...................................................
Semi-detached houses..............................................
Townhouses........................................................
Strata title units................................................
----- ----------- ------- ---
Total.............................................................
----- ----------- ------- ---
----- ----------- ------- ---
</TABLE>
THE ISSUER TRUSTEE
Westpac Securities Administration Limited (the "Issuer Trustee") will act as
trustee under the Trust and, in such capacity, as issuer of the Notes on the
terms set out in the Transaction Documents.
INCORPORATION
The Issuer Trustee was incorporated on 11th July 1944 as, and continues to
exist and operate as, a limited liability public company under the Corporations
Law of New South Wales, Australia. The Australian Company Number ("ACN") of the
Issuer Trustee is 000 049 472, and its registered office is at Level 36, 60
Margaret Street, Sydney with its principal office at Level 10, 130 Pitt Street,
Sydney.
The Issuer Trustee will issue Notes in its capacity as trustee of the Trust.
SHARE CAPITAL
The authorized share capital of the Issuer Trustee is A$10,000,000 divided
into 5,000,000 shares of A$2.00 each. The issued share capital of the Issuer
Trustee is 92,000 fully paid shares of A$2.00 each. Those shares are held by
Westpac Financial Services Group Limited (ACN 000 326 312), a wholly owned
subsidiary of Westpac.
BUSINESS
The Issuer Trustee is indirectly a wholly owned subsidiary of Westpac and is
dedicated to supporting core bank activities of Westpac by providing trustee and
custody services. The Issuer Trustee currently holds funds under administration
of A$[ ] billion in this capacity and has been servicing Westpac and
Westpac's clients since 1944.
The Issuer Trustee is an Authorized Trustee Corporation under Regulation
7.1.01 Schedule 9 of the Corporations Law; is an approved trustee for the
purposes of the Superannuation Industry (Supervision) Act 1993; and holds a
Securities Dealers License No. 11123 under the Corporations Law of New South
Wales, Australia.
The Issuer Trustee has five subsidiaries incorporated in New South Wales.
59
<PAGE>
EXPERIENCE
Currently, the Issuer Trustee is the trustee for superannuation trusts with
assets exceeding [A$ ] billion. In total the Issuer Trustee acts as trustee
or custodian (through its subsidiary company Westpac Custodian Nominees Limited)
for clients with assets exceeding A$69.8 billion.
The Issuer Trustee's experience in trusteeship began in the 1940's. The
Issuer Trustee is associated with leading investment managers and in addition,
the Issuer Trustee's experience with administrators, consultants and industry
specialists complements its capacity to service the diversified requirements of
corporate trust schemes.
The Issuer Trustee's balance sheet for the year ended September 30, 1997
showed Total Shareholder's Equity as A$40.7 million.
DIRECTORS
The directors of the Issuer Trustee are as follows:
<TABLE>
<CAPTION>
NAME HOME ADDRESS PRINCIPAL ACTIVITIES
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
Martyn John Berry 5 Bimbimbie Place, Bayview, New Investment Fund Executive
South Wales, 2104 Australia
David Matthew Fite 51 Bower Street, Manly, New South Bank Executive
Wales, 2095 Australia
John Charles Lawson 4 Allerton Road, Beecroft, New South Banker
Wales, 2119 Australia
Robert McDonald 46/26 Werona Avenue, Padstow, New Finance Executive
South Wales, 2211 Australia
Michael Anthony Migro 4 Stack Street, Balmain, New South Manager
Wales, 2041 Australia
</TABLE>
POWERS
Subject to the Master Trust Deed and the Series Notice, the Issuer Trustee
has all the rights, powers and discretion over and in respect of the Trust
Assets which it could exercise as if it were the beneficial owner of those
assets. These powers include the ability to invest in Authorized Investments, to
issue Notes and to enter into Support Facilities.
The Master Trust Deed expressly permits the Issuer Trustee to appoint the
Servicer to retain custody of the mortgage documents for the Trust in accordance
with the Servicing Agreement, and for the Issuer Trustee to lodge documents with
the Servicer.
Full details of the powers of the Issuer Trustee are set out in the Master
Trust Deed.
DUTIES
The Issuer Trustee is required to act honestly and in good faith and to
exercise such diligence and prudence as a prudent person of business would
exercise in performing its express functions and in exercising its discretion
under the Master Trust Deed. It must keep each WST trust separate from the
others and do everything necessary to ensure it can comply with its obligations
under the Transaction Documents.
60
<PAGE>
In particular the Issuer Trustee has the duty to maintain a register of
Authorized Investments (other than the Housing Loans) and to ensure that the
Trust Manager keeps accounting records which correctly record and explain all
amounts paid and received by the Issuer Trustee.
The Issuer Trustee is required to act continuously as trustee of the Trust
until the Trust is terminated as provided by the Master Trust Deed or the Issuer
Trustee has retired or been removed from office in the manner detailed below.
Each Noteholder acknowledges that:
(1) In the absence of fraud, negligence or breach of trust on its part,
the Issuer Trustee shall not be liable personally in the event of failure to
make payments on the Payment Date for payment to any Noteholder, any
Beneficiary, the Trust Manager or any other person or for any loss howsoever
caused in respect of any of the trusts or to any Noteholder, any
Beneficiary, the Trust Manager or any other person.
(2) The Issuer Trustee acts as trustee only in its capacity as trustee
of the Trust and in no other capacity. Any liability arising under or in
connection with a Transaction Document (including, without limitation, the
Offered Notes) can be enforced against the Issuer Trustee only to the extent
to which it can be satisfied out of property of the Trust out of which the
Issuer Trustee is actually indemnified for the liability. This limitation of
the Issuer Trustee's liability applies despite any other provision of the
Transaction Documents and extends to all liabilities and obligations of the
Issuer Trustee in any way connected with any representation, warranty,
conduct, omission, agreement or transaction related to the Transaction
Documents or the Trust. The limitation will not apply if there is a
reduction in the Issuer Trustee's indemnification out of trust assets as a
result of the Issuer Trustee's fraud, negligence or breach of trust.
(3) The Issuer Trustee has no duty, and is under no obligation, to
investigate whether a Trust Manager's Default, Servicer Transfer Event or
Title Perfection Event has occurred in relation to the Trust other than
where it has actual notice;
(4) The Issuer Trustee is required to provide the notices referred to in
the Master Trust Deed in respect of a determination of Adverse Effect only
if it is actually aware of the facts giving rise to the Adverse Effect; and
(5) In making any such determination, the Issuer Trustee will seek and
rely on advice given to it by its advisers in a manner contemplated by the
Master Trust Deed.
The Issuer Trustee is entitled to rely conclusively on, and is not required
to investigate the accuracy of:
(i) the contents of a Sale Notice given to it by an Approved Seller;
(ii) the contents of any report given to it by the Trust Manager or the
Servicer;
(iii) any calculations made by an Approved Seller, a Servicer or the
Trust Manager including the calculation of payments due to, or to be charged
against, the Noteholders;
(iv) the amount of, or allocation of, Collections; or
(v) the contents of any certificate provided to the Issuer Trustee under
the Master Trust Deed or any certificate given by the Trust Manager or the
Servicer, unless the Issuer Trustee is actually aware to the contrary. The
Issuer Trustee is not liable to any person in any manner whatsoever in
respect of these matters.
The Master Trust Deed also contains other provisions which regulate the
Issuer Trustee's liability to Noteholders, other creditors and any Beneficiary.
The Issuer Trustee is not liable to any person for any losses, costs,
liabilities or expenses arising out of the exercise or non exercise of its
discretion (or by the Trust Manager of its discretion) or for any instructions
or directions given to it by the Trust Manager, the
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<PAGE>
Servicer or either of the Approved Sellers. The Issuer Trustee is also not
liable for any Trust Manager's Default, Servicer Transfer Event or Title
Perfection Event. The Issuer Trustee is not liable for any act, omission or
default of the Servicer in relation to its custodian duties or its obligations
under the Servicing Agreement.
DELEGATION
In exercising its powers and performing its obligations and duties under the
Master Trust Deed, the Issuer Trustee may, with the approval of the Trust
Manager, delegate any or all of the duties, powers, discretion or other
functions of the Issuer Trustee under the Master Trust Deed or otherwise in
relation to the Trust, to a related company of the Issuer Trustee which is a
trustee company or trustee corporation for the purposes of any State or
Territory legislation governing the operation of trustee companies.
ISSUER TRUSTEE FEES AND EXPENSES
The Issuer Trustee is entitled to a quarterly fee (the "Issuer Trustee Fee")
based on the average daily balance of the aggregate Housing Loan principal
during each Collection Period, payable in arrears on the relevant Payment Date.
The Issuer Trustee is entitled to be reimbursed out of the assets of the
Trust for all expenses incurred in connection with the performance of its
obligations in respect of the Trust (other than general overhead costs and
expenses).
REMOVAL OF THE ISSUER TRUSTEE
The Issuer Trustee is required to retire as trustee after a direction from
the Trust Manager following an "Issuer Trustee's Default." An Issuer Trustee's
Default occurs if:
(1) an Insolvency Event has occurred and is continuing in relation to
the Issuer Trustee;
(2) any action is taken by or in relation to the Issuer Trustee which
causes the rating of any Notes to be downgraded;
(3) the Issuer Trustee, or any employee, delegate, agent or officer of
the Issuer Trustee, breaches any obligation or duty imposed on the Issuer
Trustee under the Master Trust Deed or any other Transaction Document in
relation to the Trust where the Trust Manager reasonably believes it may
have an Adverse Effect and the Issuer Trustee fails or neglects after 30
days' notice from the Trust Manager to remedy that breach;
(4) the Issuer Trustee merges or consolidates with another entity
without obtaining the consent of the Trust Manager and ensuring that the
resulting merged or consolidated entity assumes the Issuer Trustee's
obligations under the Transaction Documents; or
(5) there is a change in effective control of the Issuer Trustee from
that subsisting as at the date of the Master Trust Deed unless approved by
the Trust Manager.
Where the Issuer Trustee is removed because of its default, it shall bear
the costs of its removal. The Issuer Trustee indemnifies the Trust Manager and
the Trust for those costs.
On the removal of the Issuer Trustee, the Trust Manager, subject to giving
prior notice to the Rating Agencies, shall be entitled to appoint in writing
some other statutory trustee to be the Issuer Trustee under the Master Trust
Deed provided that appointment will not in the reasonable opinion of the Trust
Manager materially prejudice the interests of Noteholders. Until the appointment
is completed the Trust Manager shall act as Issuer Trustee and will be entitled
to the trustee's fee for the period it so acts as Issuer Trustee.
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VOLUNTARY RETIREMENT OF THE ISSUER TRUSTEE
The Issuer Trustee may resign on giving to the Trust Manager (with a copy to
the Rating Agencies) not less than 3 months' notice in writing (or such other
period as the Trust Manager and the Issuer Trustee may agree) of its intention
to do so.
Before retirement, the Issuer Trustee must appoint a successor trustee who
is approved by the Trust Manager, or who may be the Trust Manager, and whose
appointment will not materially prejudice the interests of Noteholders. If a
successor trustee has not been appointed by the end of the 3 months' notice
period the Trust Manager shall act as trustee until a successor trustee is
appointed.
LIMITATION OF ISSUER TRUSTEE'S LIABILITY
In the absence of fraud, negligence or breach of trust on its part, the
Issuer Trustee shall not be liable personally in the event of failure to pay
moneys on the Payment Date for payment to any Noteholder, any Beneficiary, the
Trust Manager or any other person or for any loss howsoever caused in respect of
any of the trusts or to any Noteholder, any Beneficiary, the Trust Manager or
any other person.
The Issuer Trustee acts as trustee only in its capacity as trustee of the
Trust and in no other capacity. A Noteholder cannot sue the Issuer Trustee
personally except in the case of fraud, negligence or breach of trust on the
part of the Issuer Trustee. Any liability arising under or in connection with a
Transaction Document (including, without limitation, any Offered Note) can be
enforced against the Issuer Trustee only to the extent to which it can be
satisfied out of property of the Trust out of which the Issuer Trustee is
actually indemnified for the liability. This limitation of the Issuer Trustee's
liability applies despite any other provision of the Transaction Documents and
extends to all liabilities and obligations of the Issuer Trustee in any way
connected with any representation, warranty, conduct, omission, agreement or
transaction related to the Transaction Documents or the Trust. The limitation
will not apply to the extent that there is a reduction in the Issuer Trustee's
indemnification out of trust assets as a result of the Issuer Trustee's fraud,
negligence or breach of trust.
The Issuer Trustee is also indemnified out of the Trust assets against
certain payments which it may be liable to make under the Consumer Credit
Legislation. Westpac has also indemnified the Issuer Trustee in relation to such
payments and the Issuer Trustee is required to first call on the indemnity from
Westpac.
RIGHTS OF INDEMNITY OF ISSUER TRUSTEE
Except where the Issuer Trustee fails to exercise due care or is otherwise
disentitled (including, without limitation, because of fraud, negligence or
breach of trust on its part) the Issuer Trustee will be indemnified out of the
Trust Assets against all losses and liabilities incurred by the Issuer Trustee
in properly performing any of its duties or exercising any of its powers under
the Transaction Documents in relation to the Trust.
LIMITATION OF SELLER TRUSTEE'S LIABILITY AND RIGHTS OF INDEMNITY
In the absence of fraud, negligence or breach of trust on its part, the
Seller Trustee shall not be liable personally in the event of failure to pay
moneys on the Payment Date for payment to any Noteholder, any Beneficiary, the
Trust Manager or any other person or for any loss howsoever caused in respect of
any of the trusts or to any Noteholder, any Beneficiary, the Trust Manager or
any other person.
The Seller Trustee acts as Seller Trustee only in its capacity as seller
trustee of the relevant Seller Trust and in no other capacity. A liability
arising under or in connection with a Transaction Document can be enforced
against the Seller Trustee only to the extent to which it can be satisfied out
of property of the relevant Seller Trust out of which the Seller Trustee is
actually indemnified for the liability. This limitation of the Seller Trustee's
liability applies despite any other provision of the Transaction Documents and
extends to all liabilities and obligations of the Seller Trustee in any way
connected with any representation,
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<PAGE>
warranty, conduct, omission, agreement or transaction related to the Transaction
Documents, the Trust or the relevant Seller Trust. The limitation will not apply
to the extent that there is a reduction in the Seller Trustee's indemnification
out of trust assets or the relevant Seller Trust as a result of the Seller
Trustee's fraud, negligence or breach of trust.
The Seller Trustee is also indemnified out of the assets of the relevant
Seller Trust against certain payments which it may be liable to make under the
Consumer Credit Legislation. Westpac has also indemnified the Seller Trustee in
relation to such payments and the Seller Trustee is required to first call on
the indemnity from Westpac.
RIGHTS OF INDEMNITY OF SELLER TRUSTEE
Except where the Seller Trustee fails to exercise due care or is otherwise
disentitled (including, without limitation, because of fraud, negligence or
breach of trust on its part) the Seller Trustee will be indemnified out of each
relevant Seller Trust against all losses and liabilities incurred by the Seller
Trustee in properly performing any of its duties or exercising any of its powers
under the Transaction Documents in relation to the Trust or any Seller Trust.
The Seller Trustee has not been involved in the preparation of, and does not
accept responsibility for, this Prospectus.
ORIGINATOR OF THE HOUSING LOANS
Westpac Banking Corporation ("Westpac"), Level 4, 60 Martin Place, Sydney,
NSW 2000, Australia, was established from an amalgamation of the Bank of New
South Wales and the Commercial Bank of Australia Limited (the "CBA") in 1982.
The Bank of New South Wales was Australia's first bank and was established in
1817 to promote the commercial growth of the colony and thus helped to lay the
foundations of Australia's banking system. The CBA was established in Melbourne,
Victoria in 1866 in response to the needs of the expanding business community,
principally brought about by the Victorian gold rush of the period.
Today Westpac is one of the four major commercial banks in Australia and is
the largest commercial bank in New Zealand. The Westpac Group undertakes a wide
range of banking and financial activities including commercial and investment
banking, personal and small business banking, retail and wholesale funds
management, financial services and finance company operations.
The banking activities of Westpac come under the supervision of the Reserve
Bank of Australia.
YEAR 2000
The origin of the Year 2000 "millennium bug" problem lies in the way
information in computer systems relating to calendar dates has been stored.
Computer systems, built when data storage was expensive, saved only the last two
digits of a year for date calculations in order to reduce data storage
requirements. These systems are therefore unable to differentiate, for example,
between the years 1900 and 2000. This inability to differentiate between the
different centuries could result in discrepancies such as erroneous interest
rate calculations and inaccurate statement reporting.
In recognition of the seriousness of the problem, work within the Westpac
Group began in 1996 when a Year 2000 project was initiated. The conversion plan
for making the Westpac Group's applications Year 2000 compliant is estimated to
cost A$60 million, of which A$24 million has been spent as of the end of March
1998. To the maximum extent possible, the project will utilize existing Westpac
Group resources. The objective is that all of the Westpac Group will be Year
2000 compliant by December 31, 1998, to allow adequate time for testing and to
minimize resource requirements in later years. Management of Westpac currently
estimates that the balance of the Year 2000 project conversion will be completed
by December 1998.
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<PAGE>
THE SERVICER
GENERAL
In 1996, Westpac established a wholly owned subsidiary, TMC of Level 6, 228
Pitt Street, Sydney 2000, Australia, to provide mortgage servicing capability to
both Westpac and to third parties. TMC operates from a new purpose built
servicing center in Adelaide, known as the Mortgage Processing Centre ("MPC").
The MPC employs over 1,000 staff, and processes approximately 1400 new
applications per day.
The MPC performs the following functions for Westpac: application
processing, telephone support, pre-settlement, settlement, post-settlement,
servicing and account maintenance, collections and enforcement and document
custody.
SERVICING OF HOUSING LOANS
Under the Servicing Agreement, the ongoing servicing of the Housing Loans
will be performed by TMC, as the Servicer at the MPC. Servicing procedures
include responding to customer inquiries, managing and servicing the features
and facilities available under the Housing Loans and the management of
delinquent Housing Loans. The servicing functions performed by the MPC support,
and are supported by, the activities of Westpac's branches, telemarketing and
telebanking centers. In addition, the MPC services housing loans for third
parties.
The Servicer is contractually obligated to administer the Housing Loans in
accordance with (i) the Servicing Agreement; (ii) Westpac's policies, which are
under regular review and may change from time to time in accordance with
business judgment and changes to legislation and guidelines established by
relevant regulatory bodies; and (iii) to the extent not covered by paragraphs
(i) and (ii), by exercising the degree of diligence and care expected of an
appropriately qualified Servicer of the relevant Housing Loans. See "DESCRIPTION
OF THE SERVICING AGREEMENT."
DOCUMENT CUSTODY
The Servicer is responsible for custody of the mortgage title documents on
behalf of the Issuer Trustee and has custody of the Relevant Documents in
accordance with the Servicing Agreement. See "DESCRIPTION OF THE SERVICING
AGREEMENT--Document Custody."
COLLECTION AND ENFORCEMENT PROCEDURES
Borrowers must make the minimum payment due under the terms and conditions
of the Housing Loan on or before the due date for that instalment under the
relevant loan documents. Payments are credited to the Housing Loan on the day of
receipt. Interest is calculated daily and can be charged monthly or when a
payment is made. Any payments not received by the due date will produce a
compounding interest effect.
A Housing Loan is considered delinquent ("Delinquent") whenever the minimum
instalment amount is not met. The collections system inspects all accounts which
are delinquent and records those Housing Loans for action and follow-up.
Borrowers are notified by telephone and/or by mail when their Housing Loan
becomes Delinquent. Housing Loans are allocated to collections officers who take
action depending on the delinquency history, equity in the property and the
ability of the Borrower to meet future installments. Where a Housing Loan that
is Delinquent is subject to a Mortgage Insurance Policy, the relevant Mortgage
Insurer is notified of progress of the Housing Loan and all follow-up actions
are taken by Westpac and the Servicer.
When a housing loan is 10 days delinquent, it is identified in the Mortgage
Servicing System and transferred to the MPC Collections System. Generally, once
a housing loan is 15 days delinquent, a computer generated letter is sent to the
borrower advising of the arrears and requesting that the borrower
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<PAGE>
make payments so that his account is current. When the account reaches between
23 and 29 days delinquent, the borrower may be issued a second letter or
contacted by telephone. When the account reaches between 45 and 58 days
delinquent, a third letter is generally issued which requests that the account
be made current within 15 days of the date thereof. Generally, after an account
is between 62 and 73 days overdue, a demand for full arrears is issued. Between
97 and 110 days, if the account continues to be in arrears, a demand notice will
generally be issued to the borrower and the process of contract enforcement and
loss recovery begins. The time periods specified herein assume the borrower has
either taken no action or has not honored any commitments made in relation to
the arrears.
After a default by a borrower a mortgagee can exercise its power of sale of
the mortgaged property. To exercise this power, a mortgagee must comply with the
statutory restrictions of the relevant state or territory as to notice
requirements (see "CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS - Enforcement of
Housing Loans"). The length of time between the decision to exercise its power
of sale and final completion of the sale will be dependent on factors outside
the control of the Servicer, such as whether the relevant mortgagor contests the
sale and the market conditions at the time.
Under some Housing Loans which are subject to a variable rate of interest, a
Borrower may prepay amounts which are additional to their minimum payments to
build up a buffer of funds, which is the difference between the total amount
paid by them and the total of the minimum payments required to have been made by
them. If the Borrower subsequently fails to make some or all of a minimum
payment, the collection system will apply the amount of that buffer of funds
against that missed payment. The relevant Housing Loan will not be considered to
be Delinquent until the total amount of missed payments exceeds the "credit
buffer."
Under a Housing Loan which is charged a variable rate of interest, a
Borrower who is on maternity or paternity leave and who meets specific
eligibility criteria may apply to reduce their monthly home loan repayment by up
to 50% for a maximum of six months. During the reduced repayments period, if the
payment is not sufficient to meet the interest due, the unpaid interest payment
will capitalize on the loan balance and the loan may negatively amortize.
Repayments are adjusted at the end of the parental leave period to ensure that
the loan will be repaid within its original contracted maturity.
The collection and enforcement procedures may change from time to time in
accordance with business judgment and changes to legislation and guidelines
established by the relevant regulatory bodies.
DELINQUENCIES AND MORTGAGEE IN POSSESSION WITH RESPECT TO THE SECURITIZED
PORTFOLIOS
The following tables set forth delinquency and MIP information for each of
the Securitized Portfolios (as defined herein) serviced by the Servicer in its
capacity as Servicer of securitized loans as of December 1997 and March 1998.
"Mortgage in Possession" or "MIP" means a mortgagee in possession of the related
Mortgaged Property who, following an enforcement of the relevant mortgage, is
able to deal with the Mortgaged Property without becoming the absolute owner of
the Mortgaged Property. The portfolios of securitized housing loans (the
"Securitized Portfolios") consist of the Housing Loans relating to the Series
1997-2 WST Trust, Series 1997-3 WST Trust and the Series 1997-4E WST Trust. The
indicated periods of delinquency are based on the number of days past due on a
contractual basis. The information contained in the reports presented through
Reuters which will be sent to investors will be compiled using the same
methodology as that used to compile the information contained in the table
below.
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DELINQUENCIES AND MIP
SERIES 1997-2 WST TRUST
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
AS OF AS OF
DECEMBER 14, 1997 MARCH 14, 1998
-----------------------------------------------
---------------------------------------
PERCENT
BY PERCENT BY BY PERCENT
BY NO. DOLLAR BY NO. DOLLAR BY NO. DOLLAR BY NO.
OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS
----------- ----------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Series 1997-2 Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
<CAPTION>
PERCENT
BY
DOLLAR
AMOUNT
-----------
<S> <C>
Series 1997-2 Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
</TABLE>
- ------------------------
(1) Housing Loans in MIP are also included under the heading "Total Delinquent
Loans."
DELINQUENCIES AND MIP
SERIES 1997-3 WST TRUST
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
AS OF AS OF
DECEMBER 14, 1997 MARCH 14, 1998
-----------------------------------------------
---------------------------------------
PERCENT
BY PERCENT BY BY PERCENT
BY NO. DOLLAR BY NO. DOLLAR BY NO. DOLLAR BY NO.
OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS
----------- ----------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Series 1997-3 Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
<CAPTION>
PERCENT
BY
DOLLAR
AMOUNT
-----------
<S> <C>
Series 1997-3 Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
</TABLE>
- ------------------------
(1) Housing Loans in MIP are also included under the heading "Total Delinquent
Loans."
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<PAGE>
DELINQUENCIES AND MIP
SERIES 1997-4E WST TRUST
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
AS OF AS OF
DECEMBER 14, 1997 MARCH 14, 1998
-----------------------------------------------
---------------------------------------
PERCENT
BY PERCENT BY BY PERCENT
BY NO. DOLLAR BY NO. DOLLAR BY NO. DOLLAR BY NO.
OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS AMOUNT OF LOANS
----------- ----------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Series 1997-4E Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
<CAPTION>
PERCENT
BY
DOLLAR
AMOUNT
-----------
<S> <C>
Series 1997-4E Portfolio
Period of Delinquency:
30-59 Days....................
60-89 Days....................
90 Days or more...............
Total Delinquent Loans
Housing Loans in MIP(1)
</TABLE>
- ------------------------
(1) Housing Loans in MIP are also included under the heading "Total Delinquent
Loans."
As of the date hereof, there have been no gains or losses with respect to
the Securitized Portfolios. Accordingly, no gain/loss tables are presented
herein.
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<PAGE>
It is unlikely that the delinquency experience of the Housing Loans
comprising the Series 1998-1G WST Trust will correspond to the delinquency
experience of the Securitized Portfolios set forth in the foregoing tables. The
statistics shown above represent the delinquency experience for the Securitized
Portfolios only for the periods presented, whereas the aggregate delinquency
experience on the Housing Loans comprising the Securitized Portfolios will
depend on the results obtained over the life of the Securitized Portfolios.
There can be no assurance that the Housing Loans comprising the Series 1998-1G
WST Trust will perform consistently with the delinquency or foreclosure
experience described herein. It should be noted that if the residential real
estate market in Australia should experience an overall decline in property
values, the actual rates of delinquencies and foreclosures could be higher than
those previously experienced by the Servicer with respect to the Securitized
Portfolios. In addition, adverse economic conditions may affect the timely
payment by Borrowers of scheduled payments of principal and interest on the
Housing Loans and, accordingly, the actual rates of delinquencies and
foreclosures with respect to the Series 1998-1G WST Trust.
THE TRUST MANAGER
GENERAL
Westpac Securitisation Management Pty Limited (ACN 081 709 211) is appointed
as trust manager (the "Trust Manager" or "WSML") of the Trust on the terms set
out in the Master Trust Deed and the Series Notice. WSML is a wholly owned
indirect subsidiary of Westpac and located at Level 5, 60 Martin Place, Sydney,
NSW 2000, Australia. The subsidiary was formed to provide specialized trust
management services for securitization programs for the Westpac Group.
INCORPORATION
The Trust Manager was incorporated on February 19, 1998 in the Australian
Capital Territory under the Corporations Law of the Commonwealth of Australia.
SHARE CAPITAL
The authorized share capital of the Trust Manager is A$100,000,000 shares.
The issued share capital of the Trust Manager is one fully paid share of A$1.00.
Such share is held by Westpac Equity Holdings Pty Ltd.
BUSINESS
The Trust Manager is a wholly owned indirect subsidiary of Westpac formed to
provide specialized trust management services for securitization programs for
the Westpac Group.
DIRECTORS
The directors of the Trust Manager are as follows:
<TABLE>
<CAPTION>
NAME HOME ADDRESS PRINCIPAL ACTIVITIES
- ------------------------------ --------------------------------------- ---------------------------------------
<S> <C> <C>
R. Patrick Handley 3/22 Alpert Street Bank Executive
Edgecliff
New South Wales 2027
Australia
Philip Chronican 86 Cremorne Road Bank Executive
Cremorne Point
New South Wales 2090
Australia
Lewis E. Love, Jr. 160 West End Avenue, Legal Counsel
Apartment 7J
New York, New York 10023
Marten Touw Group Treasurer
Kimberley Gire Head of Group Securitization
</TABLE>
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<PAGE>
DUTIES AND ROLE OF THE TRUST MANAGER
POWERS
The Trust Manager will carry out and perform the duties and obligations
contained in the Master Trust Deed and will have full and complete powers of
management of the Trust, including in relation to the conduct of the day to day
operation of the Trust and the administration and servicing of the assets (which
are not serviced by the Servicer), borrowings and other liabilities of the
Trusts. The Issuer Trustee has no duty to supervise the Trust Manager in the
performance of its functions and duties or the exercise of its discretion.
The Trust Manager has the absolute discretion to recommend Authorized
Investments to the Issuer Trustee and direct the Issuer Trustee in relation to
those Authorized Investments. The Issuer Trustee's role is to give effect to all
such recommendations or directions.
DELEGATION
The Trust Manager may in carrying out and performing its duties and
obligations contained in the Master Trust Deed delegate to Westpac, or any of
the Trust Manager's or Westpac's officers and employees, all acts, matters and
things (whether or not requiring or involving the Trust Manager's judgment or
discretion), or appoint any person to be its attorney, agent, delegate or
sub-contractor for such purposes and with such powers as the Trust Manager
thinks fit.
TRUST MANAGER'S FEES AND EXPENSES
The Trust Manager is entitled to a quarterly fee (the "Trust Manager Fee")
on the average daily balance of the aggregate principal balance of Housing Loans
outstanding during the Collection Period payable in arrears on the relevant
Payment Date.
The Trust Manager is entitled to be reimbursed out of the Trust Assets for
all expenses incurred in connection with the performance of its obligations in
respect of the Trust (other than general overhead costs and expenses).
REMOVAL OF THE TRUST MANAGER
The Trust Manager shall retire as trust manager if so directed by the Issuer
Trustee following a Trust Manager's Default. A "Trust Manager's Default" occurs
if:
(1) the Trust Manager fails to make any payment required by it within
the time period specified in a Transaction Document, and that failure is not
remedied within 10 Business Days of receipt from the Issuer Trustee of
notice of that failure;
(2) an Insolvency Event has occurred and is continuing in relation to
the Trust Manager;
(3) the Trust Manager breaches any obligation or duty imposed on the
Trust Manager under the Master Trust Deed, any other Transaction Document or
any other deed, agreement or arrangement entered into by the Trust Manager
under the Master Trust Deed in relation to the Trust, the Issuer Trustee
reasonably believes that breach has an Adverse Effect and the breach is not
remedied within 30 days' notice being given by the Issuer Trustee (except in
the case of reliance by the Trust Manager on the Servicer); or
(4) a representation, warranty or statement by or on behalf of the Trust
Manager in a Transaction Document or a document provided under or in
connection with a Transaction Document, is not true in a material respect or
is misleading when repeated and is not remedied to the Issuer Trustee's
reasonable satisfaction within 90 days after notice from the Issuer Trustee
where (as determined by the Issuer Trustee) it has an Adverse Effect.
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The costs of removal of the Trust Manager after a Trust Manager's Default
shall be borne by the Trust Manager. The Trust Manager has agreed to indemnify
the Issuer Trustee and the Trust for those costs.
On retirement or removal of the Trust Manager, the Issuer Trustee may
appoint another trust manager, provided the appointment will not materially
prejudice the interests of Noteholders. Until a replacement Trust Manager is
appointed, the Trust Manager must continue as Trust Manager. If a replacement
Trust Manager is not appointed within 120 days of the Issuer Trustee electing to
appoint a new Trust Manager, the Issuer Trustee will be the new Trust Manager.
VOLUNTARY RETIREMENT OF THE TRUST MANAGER
The Trust Manager may resign on giving to the Issuer Trustee (with a copy to
the Rating Agencies) not less than 3 months' notice in writing (or such other
period as the Trust Manager and the Issuer Trustee may agree) of its intention
to do so.
Before retirement, the Trust Manager must appoint a successor Trust Manager
who is approved by the Issuer Trustee, or who may be the Issuer Trustee, and
whose appointment will not materially prejudice the interests of Noteholders. If
a successor Trust Manager has not been appointed by the end of the 3 months'
notice period the Issuer Trustee shall act as Trust Manager until a successor
trust manager is appointed.
LIMITATION OF TRUST MANAGER'S LIABILITY
The principal limitations on the Trust Manager's liability are set out in
full in the Master Trust Deed. These include the following limitations:
(1) in the absence of fraud, negligence or wilful default on its part or
on the part of any of its officers, employees, agents or delegates, the
Trust Manager shall not be liable personally in the event of failure to pay
moneys on the due date for payment to any Noteholder, any Beneficiary, the
Issuer Trustee or any other person or for any loss howsoever caused in
respect of any of the Trusts or to any Noteholder, any Beneficiary, the
Issuer Trustee or other person;
(2) the Trust Manager will not be personally liable to indemnify the
Issuer Trustee or make any payments to any other person in relation to the
Trust except that there will be no limit on the Trust Manager's liability
for any fraud, negligence or wilful misconduct by it in its capacity as the
Trust Manager of the Trust;
(3) the Trust Manager will be indemnified out of the Trust in respect of
any liability, cost or expense properly incurred by it in its capacity as
Trust Manager of the Trust or so incurred by any of its delegates,
sub-delegates or agents; and
(4) subject to the Master Trust Deed, the Trust Manager is not
responsible for any act, omission, misconduct, mistake, oversight, error of
judgment, forgetfulness or want of prudence on the part of the Issuer
Trustee, the Servicer or any agent appointed by the Issuer Trustee or the
Trust Manager or on whom the Issuer Trustee or the Trust Manager is entitled
to rely under this deed (other than a related company), attorney, banker,
receiver, barrister, solicitor, agent or other person acting as agent or
adviser to the Issuer Trustee or the Trust Manager.
WESTPAC RESIDENTIAL LOAN PROGRAM
ORIGINATION OF HOUSING LOANS
The primary sources for the origination of housing loans for Westpac are:
the Westpac branch network, mobile finance managers, accredited brokers and
national telemarketing centers. Inquiries are also often generated by
advertising and direct mail campaigns.
The origination process for housing loans is carried out initially within
the appropriate Westpac branch or broker office. The origination process for all
housing loans is completed within the MPC.
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UNDERWRITING OF HOUSING LOANS
The following is a description of the underwriting processes employed by
Westpac in evaluating whether to fund a particular housing loan. When an
application is received, it is processed in accordance with Westpac's credit
policy and procedures. Credit assessment is undertaken initially using Westpac's
centrally controlled credit scoring system. The scoring system is based on
proprietary information, such as Westpac's own historical credit underwriting
experience and product policy rules. The process also includes a reference from
the Credit Reference Association of Australia. Housing loans passing through the
credit scoring system will either be approved, declined or referred to a credit
specialist. Westpac's criteria does not seek to segment borrowers who pass the
credit scoring system into groups of differing credit quality. All borrowers
must meet Westpac's standard underwriting criteria and therefore are not charged
different rates of interest based on their credit quality. Where a housing loan
is referred to a credit specialist, it is generally because the application is
more complex (for example, where the Housing Loan principal is over A$750,000 or
because the application is from a self-employed individual). An assessment is
carried out by either credit officers within the Credit Unit at the MPC or, in
some cases, by State based Credit Centers, in accordance with designated Westpac
credit policy and their credit approval limits. Each housing loan is considered
on its merits within Westpac's credit policy and procedures.
Central to the approval process is the verification of the information
provided by the applicant(s), valuation of the proposed security property and
confirmation of the ability of the applicant to make payments on the housing
loan. The verification process involves conducting an independent check as to
the accuracy and correctness of the information provided by the potential
Borrower, particularly the documentation provided by the prospective borrower
and the employment and income details of the prospective borrower. Verification
relating to the income of self-employed applicants involves checking annual
accounts and other financial information.
All applicants are required to have a minimum monthly income net of taxes in
excess of all monthly expenditures (including the housing loan being applied
for) with consideration given to likely increases in future interest rates.
Westpac policy requires substantiation of the property value either by
contract of sale or valuation by a registered panel valuer. A valuation of the
security property is required where lender's mortgage insurance is required,
where the Housing Loan Principal is greater than A$250,000 or the LVR is greater
than 80% (although the LVR and Housing Loan Principal may be lower if the
relevant Mortgaged Property is in a particular geographic area). Valuations must
be performed by registered valuers who are members of the Australian Institute
of Valuers and Land Economists. In some remote centers, assessment of the
security value is undertaken by the local branch manager. In addition, housing
loans may be secured by more than one property and in such cases the combined
values of all relevant security properties is considered.
Following pre-approval of a housing loan, a terms and conditions letter is
sent to the applicant from the MPC. When Westpac has verified details relating
to the Housing Loan to its satisfaction and acceptance of the loan offer is
received, the housing loan can proceed through to settlement and disbursement.
Once all documentation is completed to Westpac's satisfaction and settlement or
disbursement has occurred, the security documents are stamped and registered. It
is a condition of Westpac's standard mortgage documentation that the mortgagor
must maintain full replacement value property insurance at all times. Westpac
currently maintains a blanket insurance policy with Cigna Insurance Asia Pacific
Pty Limited which covers physical loss, destruction or damage to a Mortgaged
Property which is not otherwise covered by property insurance on such Mortgaged
Property.
Approval policies are under regular review and may change from time to time
in accordance with business judgment and changes to legislation and guidelines
established by the relevant regulatory bodies.
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SERVICING OF HOUSING LOANS
Under the Servicing Agreement, the ongoing servicing of the Housing Loans
will be performed by the Servicer. See "THE SERVICER" and "DESCRIPTION OF THE
SERVICING AGREEMENT."
HOUSING LOAN PRODUCTS
Westpac originates loans for both owner-occupied and investment housing. The
products within the housing loan portfolio are the following: Premium Option
Home Loan, Premium Option Home Loan with 1 year Guaranteed Rate, Special Offer
Fixed Option Home Loan, First Option Home Loan, Fixed Options Home Loan,
Variable Rate Investment Property Loan, Fixed Rate Investment Property Loan,
First Option Investment Property Loan and Special Fixed Rate Investment Property
Loan or any other similar loan product, however named, with some or all the
features referred to under "Housing Loan Features." During the term of any
Housing Loan, Westpac may from time to time or at the request of the related
Borrower change any of the features of such Housing Loans.
The following provides a general description of some of the Housing Loan
products detailed above. The Housing Loans comprising the Mortgage Pool must
satisfy certain eligibility criteria as specified under "THE TRUST
FUND--Representations and Warranties."
OWNER OCCUPIED HOME LOANS
First Option Home Loans: These loans are low variable rate owner-occupied
home loans for borrowers motivated by price. The product was developed to
compete with products offered by non-bank originators. Additional loan features
(as described below) can be activated on request by the borrower for a fee. The
current maximum term for this product is 25 years, although it may be changed to
30 years in the future.
Premium Option Home Loans: These loans are variable rate owner-occupied home
loans. These loans have a maximum term to maturity of 30 years and a higher rate
of interest than the First Option Home Loan and as a result, borrowers are
allowed access to the various loan features at no or reduced additional cost.
Premium Option Home Loans with 1 Year Guaranteed Rate: These loans have an
introductory discounted fixed rate for 12 months that then converts to a Premium
Option Home Loan. Apart from the introductory fixed rate period, the loan has
the same features as the Premium Option Home Loan.
Special Offer Fixed Option Home Loans: These loans have a fixed rate period
of one or two years that converts to a Premium Option Home Loan. Apart from the
fixed rate period, the loan has the same features as the Premium Option Home
Loan. In 1996, this product was replaced by the Premium Option Home Loan with 1
Year Guaranteed Rate product described above.
Fixed Options Home Loans: These loans are fixed rate owner-occupied home
loans. Loan terms are to a maximum of 30 years with a maximum fixed rate term of
10 years. On maturity of the fixed rate term, the loan converts to the Premium
Option Home Loan unless the borrower requests a further fixed rate period.
Certain product features (e.g., redraw) are not available during the fixed rate
period.
INVESTMENT PROPERTY LOANS
An investment property loan is a loan which assists with the purchase or
refinance of residential property for investment purposes such as rental income
or capital gain. The primary security for the loan is a registered first party
first ranking mortgage over residential property.
Investment property loans can be either fixed rate or variable rate loans
with a maximum term of 25 years. The loans may provide for interest only
payments for a maximum term of 5 years and then must convert to required payment
of principal and interest. Loans may have fixed rate terms for up to a
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maximum of 10 years which will convert at such time to a variable rate unless
the borrower requests another fixed rate term.
The First Option Investment Property Loan is a low variable rate loan which
is similar to the First Option Home Loan and the Variable Investment Property
Loan is similar to the Premium Option Home Loan, the major difference being the
loan purpose.
HOUSING LOAN FEATURES
GENERAL
Housing Loans originated by Westpac may have some or all of the features
described below. In addition, during the term of any Housing Loan, Westpac may
change any of the features of such Housing Loan from time to time at the request
of the related Borrower.
SUBSTITUTION OF SECURITY
A Borrower may apply to substitute a new Mortgage over a residential
property for an existing Mortgage, to add a further Mortgage as security for a
Housing Loan or to release a security property under a Mortgage. Provided that
the application meets certain credit criteria, the Mortgage which secures a loan
may be portable and may be discharged without full repayment of the Housing Loan
provided another acceptable Mortgage is substituted in its place.
Where the substitute property meets the Eligibility Criteria and is
acceptable to the relevant Mortgage Insurer, and settlement on the substitute
property can occur simultaneously with the discharge of the current property,
the Housing Loan will remain in the Mortgage Pool. Where the substitute property
does not meet the Eligibility Criteria or is not acceptable to the Mortgage
Insurer, or the settlement does not occur simultaneously with discharge, the
Housing Loan will be transferred out of the Mortgage Pool for a corresponding
cash payment in the amount of the Unpaid Balance.
REDRAW
Certain Housing Loans in the Mortgage Pool which are charged a variable rate
of interest have the benefit of a redraw facility which allows the Borrower to
draw on repayments made in excess of scheduled repayments (a "Redraw").
Borrowers may request a redraw at any time. In certain circumstances, Westpac
has a contractual obligation under the loan document to provide the redraw
should the Borrower be entitled to a redraw because of prepayments and the
Housing Loan is not delinquent.
A Redraw will not result in the Housing Loan being removed from the Mortgage
Pool.
See "DESCRIPTION OF THE OFFERED NOTES--Description of the Redraw Facility,
Redraw Funding Securities and RFS Class A Notes."
REPAYMENT HOLIDAY
The terms of the Mortgage securing a Housing Loan which is charged a
variable rate of interest may provide for a "payment holiday." A payment holiday
can occur where the Borrower has prepaid amounts of principal, creating a buffer
of funds between the current principal balance and the amortization scheduled
balance. In such a case, the Borrower may cease to make payments until the
outstanding balance of the Housing Loan plus unpaid interest equals the balance
of the theoretical amortization schedule. Where the Housing Loan allows for a
"payment holiday", the Housing Loan payment will be taken from the buffer of
funds between the current principal balance and the amortization scheduled
balance at that payment date. If a buffer of funds is available, the system will
recognize this as an installment received. Housing Loans are not considered
Delinquent during a payment holiday and remain in the Mortgage Pool.
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EARLY REPAYMENT
Early repayment and partial prepayment of any Housing Loan is permitted
while such Housing Loan is subject to a variable rate of interest. Housing Loans
which are charged a fixed rate of interest, if repaid within their fixed rate
term, may be subject to an economic break cost or benefit in accordance with the
terms of the Housing Loan. For Housing Loans not regulated by the Consumer
Credit Legislation, an early termination fee may be payable.
TOP UP
The loan agreement and/or Mortgage relating to a Housing Loan may allow for
the relevant Borrower to request from Westpac additional funds such that the
resulting principal balance will exceed the amortization scheduled balance at
that time. These are "top ups." Top ups will only be provided by Westpac in
accordance with its then current underwriting and credit policies. Any Housing
Loan subject to a top up will be removed from the Mortgage Pool.
PARENTAL LEAVE
Under a Housing Loan which is charged a variable rate of interest, any
Borrower who is on maternity or paternity leave and who meets specific
eligibility criteria may apply to reduce the related monthly home loan repayment
by up to 50% of such payment amount for a maximum of six months. During the
reduced repayment period, if the payment is not sufficient to meet the interest
due, the unpaid interest payment will capitalise on the loan balance and the
loan may negatively amortize. Scheduled repayments are adjusted at the end of
the parental leave period to ensure that the loan will be repaid within its
original contracted maturity.
INTEREST RATE SWITCHING
The interest rate charged on Housing Loans may be either fixed rate or
variable rate. Fixed rate loans will automatically convert to variable rate at
the end of the fixed rate period (as specified in the related loan agreement)
unless the relevant Borrower elects another fixed rate period. Some loans have
an introductory fixed rate of interest which converts to a variable rate of
interest at the end of such introductory period. Some loans allow the Borrower
the option to convert from a variable rate to a fixed rate (or vice versa).
ACCOUNT MANAGEMENT FACILITY
A Borrower may elect to have his/her regular salary paid in full or part
into their Housing Loan account. If this amount exceeds the amortised scheduled
balance at that time, surplus funds are created therein that may be redrawn.
This feature will allow the customer in the aggregate up to fifteen automatic
disbursements in each payment cycle against these surplus funds to other
accounts. These disbursements will be treated as Redraws.
PAYMENT TYPE
On the Cut-Off Date, the payment types under the Housing Loans will be
interest only or principal, interest and fees ("P & I"). Interest only periods
can be for terms of 1-5 years. At the end of any interest only period, the
payment type under the relevant Housing Loan will convert to P & I payments such
that the scheduled payments will result in the Housing Loan being repaid on an
amortizing schedule within the contractual term of the Housing Loan.
SWITCHING TO AN INVESTMENT OR OWNER-OCCUPIED LOAN
The Borrower may elect to switch the purpose of a Housing Loan from
owner/occupied property finance to investment property finance or vice versa.
Any such switch will not require the relevant Housing
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Loan to be removed from the Mortgage Pool. The Borrower is required to notify
Westpac of such switch and the Mortgage Rate with respect to such Housing Loan
may be changed accordingly.
CAPITALIZED FEES
Westpac may offer Borrowers the ability to choose certain product features
without paying an up-front fee. Instead, the fee may be capitalized under the
Housing Loan and would constitute part of the principal to be amortized over the
life of the Housing Loan.
COMBINATION HOUSING LOANS
A Borrower may split his/her Housing Loan into different portions which may
(among other things) be subject to different interest rate options. This could
occur, for example, where a Borrower elects to have one part of their Housing
Loan at a fixed rate and the other at a variable rate. Each loan is effectively
a separate loan which operates independently of the other loans in the combined
product and is governed by its own policy and procedures.
If a Housing Loan is "split" into more than one loan, any newly created
loans will not form part of the pool. In the event that the original loan is
retained (potentially at a reduced balance) in certain circumstances (e.g., it
satisfies all Eligibility Criteria and does not have any feature that would
require it to be removed from the pool) it will remain in the pool.
ADDITIONAL FEATURES
Westpac may, in relation to a Housing Loan in the Mortgage Pool, from time
to time seek to offer additional features which are not referred to above.
Before doing so, Westpac must satisfy the Trust Manager that the additional
features would not affect any relevant Mortgage Insurance Policy and would not
cause the rating of any Offered Notes to be downgraded or withdrawn.
THE MORTGAGE INSURANCE POLICIES
MORTGAGE INSURANCE POLICIES--GENERAL
On or before the Closing Date, the Mortgage Pool Insurance Policy will be
provided by Housing Loans Insurance Corporation Limited of 31 Market Street,
Sydney NSW 2000, Australia ("HLIC") to the Issuer Trustee to cover losses in
respect of each Housing Loan that is not subject to a PMI Policy. The Mortgage
Pool Insurance Policy generally applies to loans with an LVR of 80% or less at
the Cut-Off Date. The Mortgage Pool Insurance Policy will cover losses up to a
maximum aggregate amount of A$ .
Each Housing Loan with an LVR of greater than 80% at the time of origination
(or a lower LVR where required by Westpac's standard credit policy) will have
been insured under a PMI Policy issued by SunAlliance and Royal Mortgage
Insurance Limited (ACN 001 825 725) of Level 9, 465 Victoria Avenue, Chatswood
NSW ("SunAlliance"), MGICA Limited (ACN 000 511 017) of Level 23 AMP Centre, 50
Bridge Street, Sydney NSW ("MGICA"), Westpac Lenders Mortgage Insurance Limited
(ACN 074 042 934) of Level 11, 50 Pitt Street, Sydney NSW ("WLMI") or HLIC. Each
Approved Seller will equitably assign its interest in each PMI Policy to the
Issuer Trustee on the Closing Date.
THE HLIC MORTGAGE POOL INSURANCE POLICY
GENERAL
The HLIC Mortgage Pool Insurance Policy (the "Mortgage Pool Insurance
Policy") is an insurance policy put in place to cover Housing Loans that were
not insured prior to the Cut-Off Date and which had an LVR of less than or equal
to 80% as of the Cut-Off Date. Under the Mortgage Pool Insurance Policy, HLIC
will insure the Issuer Trustee with effect from the Closing Date for Finance
Charge Losses and Principal Losses in respect of the Housing Loans (other than
those Housing Loans which are individually
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covered by an HLIC, a SunAlliance, WLMI or an MGICA Insurance Policy) (see
"--Primary Mortgage Insurance Policies" below).
PERIOD OF COVER
The Issuer Trustee has the benefit of the Mortgage Insurance Policy in
respect of each Housing Loan from the date the Housing Loan and the relevant
Mortgage are beneficially assigned to it until the earliest of:
(i) other than with respect to the assignment to the Security Trustee
under the Security Trust Deed, the date the Housing Loan or the relevant
Mortgage is assigned, transferred or mortgaged to a person other than a
person who is or becomes insured under the Mortgage Pool Insurance Policy;
(ii) the date the Housing Loan is repaid in full;
(iii) the date the Housing Loan ceases to be secured by the relevant
Mortgage (other than in the case where the Mortgage is discharged by the
operation of a compulsory acquisition or sale by a government for public
purposes);
(iv) the maturity date set out in the "Certificate of Insurance" (as
defined in the Mortgage Pool Insurance Policy), or as extended with the
consent of the Mortgage Insurer or as varied by a court under the Consumer
Credit Legislation; and
(v) the date the Mortgage Pool Insurance Policy is cancelled in respect
of the Housing Loan in accordance with the Mortgage Pool Insurance Policy.
COVER FOR LOSSES
HLIC is obliged to pay to the Issuer Trustee the loss as at the Loss Date
(as defined herein) in respect of a Housing Loan, being the aggregate of:
(i) the principal amount outstanding under such Housing Loan together
with any interest, fees or charges (whether capitalized or not), that are
outstanding at the Loss Date;
(ii) fees and charges paid or incurred by the Issuer Trustee; and
(iii) such other amounts (including fines or penalties) which HLIC
approves in its absolute discretion; which the Issuer Trustee is entitled to
recover under the relevant Housing Loan contract and Mortgage less
deductions including:
(iv) any sale proceeds or compensation for compulsory acquisition of the
Mortgaged Property;
(v) in the event of foreclosure, the value of the Issuer Trustee's
interest in the Mortgaged Property;
(vi) any amount received by the Issuer Trustee under any collateral
security;
(vii) amounts paid to the Issuer Trustee by way of rents, profits or
proceeds in relation to the Mortgaged Property or under any policy of
insurance relating to the Mortgaged Property not applied in restoration or
repair;
(viii) any interest whether capitalized or not that exceeds interest at
the (non-default) interest rate (in accordance with the Consumer Credit
Legislation, if applicable) payable in relation to that Housing Loan;
(ix) any fees or charges, whether capitalized or not, that are not of a
type, or which exceed certain maximum amounts, as specified in the Mortgage
Pool Insurance Policy;
(x) losses directly arising out of physical damage to the Mortgaged
Property (other than from fair wear and tear or losses recovered and applied
in the restoration or repair of the Mortgaged Property prior to the Loss
Date or which were recovered under a policy of insurance and applied to
reduce the amount outstanding under the Housing Loan; and
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(xi) any amounts by which a claim may be reduced under the Mortgage Pool
Insurance Policy.
"Loss Date" means, in respect of a Housing Loan:
(a) where, following an event on or following which the Approved Seller
or the Issuer Trustee's power of sale in relation to the relevant Mortgaged
Property becomes exercisable whether immediately or at the option of the
Approved Seller or the Issuer Trustee or upon the expiration of any notice
or period of time and whether or not the power of sale only arises if before
the expiration of the notice or period of time the default remains
unremedied (a "Mortgage Default"), the Approved Seller or the Issuer Trustee
or a prior mortgagee in respect of the Mortgaged Property sells the
Mortgaged Property, the date on which the sale is completed;
(b) where, following a Mortgage Default, the Approved Seller or the
Issuer Trustee or a prior mortgagee in respect of the Mortgaged Property
becomes the absolute owner by foreclosure, the date on which that event
occurs;
(c) where, following a Mortgage Default, the Borrower sells the
Mortgaged Property with the prior approval of the Approved Seller, the
Issuer Trustee and HLIC, the date on which the sale is completed;
(d) where the Mortgaged Property is compulsorily acquired or sold by a
government for public purposes and there is a Mortgage Default (or where the
Mortgage has been discharged by the operation of the compulsory acquisition
or sale and there is a default in repayment of the loan secured by the
Mortgage which would have been a Mortgage Default but for the occurrence of
that event), the date being the later of the date of the completion of the
acquisition or sale or the date twenty-eight days after the date of the
Mortgage Default; and
(e) where the HLIC has agreed or determined to pay a claim under the
Mortgage Pool Insurance Policy, the date specified in that agreement or
determination.
If the Consumer Credit Legislation applies to a Mortgage, HLIC's liability
is limited to the amount required to discharge the mortgage under the Consumer
Credit Legislation.
AGGREGATE LIMIT
The Mortgage Pool Insurance Policy will be subject to an aggregate limit of
loss of A$ .
ISSUER TRUSTEE'S INTEREST EXTINGUISHED
If the Issuer Trustee's interest in a Housing Loan is extinguished in favor
of Westpac as a result of:
(1) a breach of Westpac's representations and warranties in relation to the
Housing Loan which is discovered within 120 days of the Closing Date (or, in
relation to Housing Loans assigned to the Issuer Trustee from the assets of
another Seller Trust, 120 days after the date on which those Housing Loans were
first sold by Westpac to the Issuer Trustee in its capacity as trustee of other
Seller Trusts) and which breach was not remedied within that period (see
"WESTPAC RESIDENTIAL LOAN PROGRAM--Eligibility Criteria"); or
(2) a repurchase of a Housing Loan in accordance with Westpac's right of
first refusal, then Westpac will be entitled to the benefit of the Mortgage Pool
Insurance Policy in so far as it applies to that Housing Loan.
REFUSAL OR REDUCTION IN CLAIM
The amount of a claim may be reduced or cancelled by HLIC in the following
circumstances:
(i) any premium is not paid within twenty-eight days of the due date
therefor;
(ii) The Housing Loan contract for the relevant Mortgaged Property does
not require the Mortgaged Property to be insured under a general insurance
policy;
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(iii) there ceases to be a Servicer approved by HLIC to service the
Housing Loans for the Issuer Trustee;
(iv) a claim is not lodged within twenty-eight days of the relevant Loss
Date;
(v) there is any representation or statement (deemed or otherwise) in a
proposal for a Pool Mortgage Insurance Policy that is incorrect or the duty
of disclosure under the Mortgage Pool Insurance Policy is breached;
(vi) the Issuer Trustee or the Servicer does not comply with the
reporting obligations under the Mortgage Pool Insurance Policy;
(vii) the relevant Mortgage has not been duly registered with the land
titles office in the jurisdiction where the related Mortgaged Property is
located; and
(viii) the Housing Loan contract, the Mortgage or any collateral security
for the relevant Mortgaged Property has not been duly stamped, or the stamp
duty thereon has not been paid, in each relevant jurisdiction.
Under the Servicing Agreement, the Servicer undertakes to perform (and
indemnifies the Issuer Trustee against) certain obligations of the Issuer
Trustee, including the Issuer Trustee's duties of disclosure and its reporting
obligations under the Mortgage Pool Insurance Policy. See "-Servicer
Undertakings with Respect to Insurance Policies". This arrangement is
acknowledged in the Mortgage Insurance Policy.
Circumstances in which claims under a Mortgage Insurance Policy may be
reduced or cancelled also include the following events occurring in relation to
the Issuer Trustee without the approval of the Mortgage Insurer:
(i) the making of any additional advance (other than Redraws) upon the
security of a Mortgaged Property that ranks for payment ahead of the Housing
Loan;
(ii) materially altering the terms of a Housing Loan contract, any
related Mortgage or any collateral security other than an alteration made in
accordance with the Consumer Credit Legislation;
(iii) allowing its rights to be reduced against the Borrower, the
relevant mortgagor, any mortgage guarantor, any provider of any collateral
security or the Mortgaged Property by compromise, postponement, partial
discharge or otherwise;
(iv) approving any transfer or assignment of the Mortgaged Property
without full discharge of the Housing Loan;
(v) a violation by the Issuer Trustee of any provision of such Mortgage
Pool Insurance Policy; and
(vi) consenting to a further advance by a prior mortgagee previously
approved by HLIC upon the security of an approved prior mortgage.
EXCLUSIONS
The Mortgage Insurance Policy does not cover any loss arising from:
(i) any war or warlike activities;
(ii) nuclear contamination;
(iii) the existence or escape of any pollution or environmentally
hazardous material;
(iv) the fact that the Housing Loan contract, the relevant Mortgage or
any collateral security is void or unenforceable; or
(v) where the Consumer Credit Legislation applies, any failure of the
Housing Loan contract, the relevant Mortgage or any collateral security to
comply with the requirements of the Consumer
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Credit Legislation. See "CERTAIN LEGAL ASPECTS OF THE HOUSING
LOANS--Consumer Credit Legislation."
CLAIMS
A claim may only be made under the Mortgage Pool Insurance Policy following
the Loss Date for the relevant Mortgage. If a Housing Loan has been in default
for at least 6 months HLIC may in its absolute discretion pay the claim for the
loss even if the Loss Date has not occurred. Claims are payable within 14 days
of receipt by HLIC of the completed claim form.
HLIC may, as a condition to payment of a claim, require an assignment to it
by the Issuer Trustee (at the Issuer Trustee's expense) of rights against the
Borrower or any mortgagor or require the Issuer Trustee to take action, or
empower HLIC, in relation to the relevant Housing Loan or related Mortgage.
VARIATIONS
HLIC may not vary the Mortgage Insurance Policy for any Housing Loan except
where the variation is generally applied to all insured customers of the same
type in relation to the same type of insurance and where the variation is
necessitated to ensure that, as a consequence of a change in law after the date
of the Mortgage Insurance Policy, HLIC is not in breach of the law.
HOUSING LOAN INSURANCE CORPORATION LTD (HLIC LTD)
HLIC was established in 1965 by the Commonwealth Government of Australia
("Government") and is Australia's leading lenders' mortgage insurer ("LMI") with
approximately 50% of the Australian LMI market. In December 1997, the Government
sold HLIC to GE Capital Australia ("GECA") which is a wholly owned subsidiary of
GE Capital Services Inc. ("GE").
GE is a diversified industrial and financial services company with
operations in over 100 countries. It is rated AAA by Standard & Poor's, Aaa by
Moody's and AAA by Fitch IBCA. It has significant LMI business around the world,
operating in the United States, United Kingdom, Canada and now Australia and has
over US$165 billion of loans insured globally.
HLIC has been given a AAA claims paying rating in its own right by Standard
& Poor's, a Aa1 rating by Moody's and a AAA rating by Fitch. Loans insured prior
to the sale to GECA will also have the benefit of a guarantee by the Government.
That proportion that has the benefit of the Government guarantee is $ as
of the Cut-Off Date.
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PRIMARY MORTGAGE INSURANCE POLICIES
GENERAL
Each Borrower under a Housing Loan which had an LVR of greater than 80% at
the date of origination (or a lower LVR where required by Westpac's standard
credit policy) was required to effect a mortgage insurance policy with either
SunAlliance, MGICA, WLMI or [HLIC] (a "PMI Policy"). Westpac is required to
equitably assign its interest in each Primary Mortgage Insurance Policy to the
Issuer Trustee on the Closing Date. The consent of SunAlliance, MGICA, WLMI and
[HLIC] is required for the assignment of the relevant Mortgages and the Primary
Mortgage Insurance Policies, and for the Servicer to service the insured Housing
Loans. Westpac must ensure that these consents are obtained on or prior to the
Closing Date.
[Where a provision of the HLIC PMI Policy is inconsistent with the HLIC
Mortgage Pool Insurance Policy, the provision in the HLIC Mortgage Pool
Insurance Policy will be taken to apply to the HLIC PMI Policy.]
[The HLIC Mortgage Pool Insurance Policy provides for the assignment to the
Trust of any HLIC PMI Policy.]
RESTRICTIONS AND CANCELLATION
The amount recoverable under each PMI Policy will generally be the amount
owing in relation to the relevant Mortgage (including unpaid principal, accrued
interest at any non-default rate, proper tax and reasonable enforcement costs
(subject in certain instances to insurer's consent)) less all amounts recovered
from enforcement of the Mortgage. However, there are a number of requirements
and restrictions imposed on the insured under each PMI Policy which may entitle
the Mortgage Insurer to cancel the PMI Policy or reduce the amount of a claim;
including:
(1) the existence of an encumbrance or other interest which affects or
has priority over the Mortgage;
(2) the relevant Mortgage, or a guarantee or indemnity relating to the
Mortgage, ceasing to be effective;
(3) that there is a material omission or misstatement by the insured in
relation to the Primary Mortgage Insurance Policy;
(4) that any premium is not paid within the relevant grace period (if
any);
(5) termination by the insurer upon the giving of a set period of
notice;
(6) a breach by the insured of the PMI Policy; and
(7) certain circumstances which affect the insured's rights or
recoveries under the relevant Housing Loan or Mortgage.
Each PMI Policy has different provisions. The above is a summary of certain
provisions--some may not relate to, or may differ from, a particular PMI Policy.
SERVICER UNDERTAKINGS WITH RESPECT TO INSURANCE POLICIES
Under the Servicing Agreement, the Servicer undertakes to:
(1) act in accordance with the terms of any Mortgage Insurance Policy;
(2) not do anything that would prejudicially affect the rights of the
Issuer Trustee under a Mortgage Insurance Policy; and
(3) promptly make claims and notify the Trust Manager when claims are
made.
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DESCRIPTION OF SUNALLIANCE, MGICA AND WLMI
The Royal SunAlliance Group entered into the lenders mortgage insurance
market in Australia in 1989. Since then SunAlliance's Mortgage Insurance
Division has displayed solid growth and operates as one of the major divisions
of the Royal and SunAlliance Group. SunAlliance is a subsidiary of Royal and
SunAlliance Insurance Australia Limited, which is one of the five largest
insurers in Australia with premium revenue of some A$1.1 billion, assets in
excess of A$1.8 billion and a net asset position at December 31, 1997 of over
A$373 million. Royal & Sun Alliance Lenders Mortgage Insurance Ltd ("RSALMI") is
rated AA- by Standard & Poor's, and is owned by the Sun Alliance group. Under a
deed of indemnity, RSALMI is explicitly indemnified for past, present and future
obligations arising from insurance contracts net of reinsurance by the
Australian holding company for the group, Sun Alliance and Royal Insurance
Australia Holdings Ltd. The business address of SunAlliance is Level 9, 465
Victoria Avenue, Chatswood, New South Wales, Australia.
MGICA has been operating in the Australian housing market since 1965 and is
a specialist insurer of residential mortgage loans. MGICA is owned and
explicitly supported by, Australian Mutual Provident Society ("AMP"),
Australia's largest insurance company rated AAA for its claims paying ability by
Standard & Poor's and Aa2 by Moody's. MGICA is rated AA- by Standard & Poor's
for its claim paying ability and A1 by Moody's for its claims paying ability.
MGICA is strongly capitalized after receiving an injection of A$50mm of capital
from its parent, AMP, in 1995. Moody's indicates the geographic diversity of
MGICA's insurance risk profile is good and underwriting standards are considered
appropriately conservative. The business address of MGICA is Level 23 AMP
Centre, 50 Bridge Street, Sydney, New South Wales, Australia.
WLMI is an unrated insurance company authorized under the Insurance Act 1973
to carry on insurance business in Australia. WLMI is a wholly owned subsidiary
of Westpac Insurance Services (Brokers) Limited. The ultimate parent entity is
Westpac Banking Corporation. Under a Management Agreement and Quota Share
Reinsurance Agreement between WLMI and Royal and SunAlliance Mortgage Insurance
Limited both dated August 27, 1996 SunAlliance agrees to provide management and
administration services to WLMI and accepts 65% of the obligation on each and
every policy issued by WLMI. WLMI retains the remaining 35% of the obligation.
Under a Deed of Guarantee, SunAlliance will unconditionally and irrevocably
guarantee the obligations of WLMI arising under policies issued by WLMI prior to
the termination of the deed, and to the extent that those obligations are not
recovered or met by contracts of reinsurance. The business address of WLMI is 50
Pitt Street, Sydney, New South Wales, Australia.
PRINCIPAL PAYMENT AND YIELD CONSIDERATIONS
The following information is given solely to illustrate the effect of
principal payments of the Housing Loans on the weighted average life of the
Offered Notes under the stated assumptions and is not a prediction of the
principal payment rate that might actually be experienced by the Housing Loans.
GENERAL
The rate of principal payments on the Offered Notes, the aggregate amount of
distributions on the Offered Notes and the yield to maturity of the Offered
Notes will be related to the rate and timing of payments of principal on the
Housing Loans. The rate of principal payments on the Housing Loans will in turn
be affected by the amortization schedules of the Housing Loans and by the rate
of principal prepayments (including for this purpose prepayments resulting from
refinancing, liquidations of the Housing Loans due to defaults, casualties,
condemnations and repurchases by an Approved Seller). The Housing Loans may be
prepaid by the Mortgagors at any time (subject, in the case of fixed rate
Housing Loans, to the payment of any applicable fees).
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PRINCIPAL PAYMENTS
Principal payments, liquidations and purchases of the Housing Loans
(including optional purchase of the remaining Housing Loans in connection with
the termination of the Trust) will result in distributions on the Offered Notes
of principal amounts which would otherwise be distributed over the remaining
terms of such Housing Loans. Since the rate of payment of principal of the
Housing Loans will depend on future events and a variety of factors, no
assurance can be given as to such rate or the rate of principal payments. The
extent to which the yield to maturity of any Offered Note may vary from the
anticipated yield will depend upon the degree to which a Note is purchased at a
discount or premium, and the degree to which the timing of payments thereon is
sensitive to scheduled payments, prepayments, liquidations and purchases of such
Housing Loans. The rate of principal payment on the Housing Loans cannot be
predicted. The prepayment experience of the Trust with respect to the Housing
Loans may be affected by a wide variety of factors, including economic
conditions, the availability of alternative financing and homeowner mobility.
WEIGHTED AVERAGE LIVES
Generally, greater than anticipated payments of principal will increase the
yield on Offered Notes purchased at a price less than par and will decrease the
yield on Offered Notes purchased at a price greater than par. The effect on an
investor's yield due to principal payments on the Housing Loans occurring at a
rate that is faster (or slower) than the rate anticipated by the investor in the
period immediately following the issuance of the Notes will not be entirely
offset by a subsequent like reduction (or increase) in the rate of principal
payments. Principal payments and therefore the weighted average life of the
Offered Notes will be affected by the amount and timing of delinquencies and
defaults on the Housing Loans and the recoveries, if any, on defaulted Housing
Loans and foreclosed properties.
The "weighted average life" of a Note refers to the average amount of time
that will elapse from the date of issuance of the Note to the date each dollar
in respect of principal repayable under such Note is reduced to zero. The
weighted average life of the Offered Notes will be influenced by, among other
factors, the rate at which principal payments are made on the Housing Loans.
The following tables are based on a constant payment rate model ("CPR"). CPR
is a constant rate of principal payment, combining both scheduled repayments as
well as unscheduled prepayments, with no principal increases or redraws granted.
CPR differs from the CONSTANT PREPAYMENT MODEL commonly applied in U.S. mortgage
transactions where scheduled payments are NOT included. CPR represents an
assumed constant rate of payment each month, expressed as a per annum percentage
of the principal balance of the pool of mortgage loans for that month. CPR does
not purport to be a historical description of payment experience or a prediction
of the anticipated rate of payment of any pool of housing loans, including the
Housing Loans. None of the Approved Sellers, the Trust Manager nor the Issuer
Trustee believes that any existing statistics of which it is aware provide a
reliable basis for holders of Offered Notes to predict the amount or the timing
of receipt of payments on the Housing Loans.
Since the following tables were prepared on the basis of the assumptions in
the following paragraph, there are discrepancies between characteristics of the
actual Housing Loans and the characteristics of the Housing Loans assumed in
preparing the tables. Any such discrepancy may have an effect upon the
percentages of the principal balances outstanding and weighted average lives of
the Offered Notes set forth in the tables. In addition, since the actual Housing
Loans in the Trust have characteristics which differ from those assumed in
preparing the tables set forth below, the distributions of principal on the
Offered Notes may be made earlier or later than as indicated in the tables.
For the purpose of the tables below, it is assumed that: (i) the Closing
Date for the Offered Notes is June , 1998, (ii) payments on the Offered
Notes are made on the 19th day of each Quarter regardless of the day on which
the Payment Date actually occurs, commencing in July 1998 and are made in
accordance with the priorities described herein, (iii) the scheduled monthly
payments of principal and interest on the Housing Loans will be timely delivered
on the first day of each month commencing in
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July 1998 (with no defaults), (iv) all principal payments are payments in full
received on the last day of each month and include 30 days' interest thereon,
(v) no optional termination is exercised and (vi) the Offered Notes have the
Interest Rate and initial principal balances set forth herein. The preceding
clauses are the assumptions used in preparing the following tables and are not
necessarily expected to be predictive of the Mortgage Pool's actual performance.
It is not likely that the Housing Loans will pay at any constant multiple of
the assumed CPR to maturity or that all Housing Loans will pay at the same rate.
In addition, the diverse remaining terms to maturity of the Housing Loans (which
include recently originated Housing Loans) could produce slower distributions of
principal than as indicated in the tables at the multiples of CPR specified,
even if the weighted average remaining term to maturity of the Housing Loans is
the same as the weighted average remaining term to maturity of the assumptions
described above. Investors are urged to make their investment decisions on a
basis that includes their determination as to anticipated principal payment
rates under a variety of the assumptions discussed herein as well as other
relevant assumptions.
In the following tables the weighted average life of each Class was
determined on the basis of the calculation of CPR as defined herein, which
differs from the way weighted average lives are calculated in U.S. mortgage
transactions where scheduled payments are not included.
PERCENT OF ORIGINAL INVESTED AMOUNT OUTSTANDING AT THE FOLLOWING PERCENTAGES OF
CPR(1)
<TABLE>
<CAPTION>
CLASS A NOTES: US$
-----------------------------------------------------
DATE 0% % % % %
- -------------------------------------------------------------------------- --- --- --- --- ---
<S> <C> <C> <C> <C> <C>
Initial Percent........................................................... 100 100 100 100 100
June 1999.................................................................
June 2000.................................................................
June 2001.................................................................
June 2002.................................................................
Weighted Average Life(2)--
To Maturity (Years).....................................................
To Call (Years).........................................................
<CAPTION>
DATE %
- -------------------------------------------------------------------------- ---
<S> <C>
Initial Percent........................................................... 100
June 1999.................................................................
June 2000.................................................................
June 2001.................................................................
June 2002.................................................................
Weighted Average Life(2)--
To Maturity (Years).....................................................
To Call (Years).........................................................
</TABLE>
- ------------------------
(1) The percentages in this table have been rounded to the nearest whole number.
(2) The weighted average life of a Class is determined by (a) multiplying the
amount of each payment of principal thereof by the number of years from the
date of issuance to the related Payment Date, (b) summing the results and
(c) dividing the sum by the aggregate distributions of principal referred to
in clause (a) and rounding to one decimal place.
PERCENT OF ORIGINAL INVESTED AMOUNT OUTSTANDING AT THE FOLLOWING PERCENTAGES OF
CPR(1)
<TABLE>
<CAPTION>
CLASS B NOTES: $
-----------------------------------------------------
DATE 0% % % % %
- -------------------------------------------------------------------------- --- --- --- --- ---
<S> <C> <C> <C> <C> <C>
Initial Percent........................................................... 100 100 100 100 100
June 1999.................................................................
June 2000.................................................................
June 2001.................................................................
June 2002.................................................................
Weighted Average Life(2)--
To Maturity (Years).....................................................
To Call (Years).........................................................
<CAPTION>
DATE %
- -------------------------------------------------------------------------- ---
<S> <C>
Initial Percent........................................................... 100
June 1999.................................................................
June 2000.................................................................
June 2001.................................................................
June 2002.................................................................
Weighted Average Life(2)--
To Maturity (Years).....................................................
To Call (Years).........................................................
</TABLE>
- ------------------------
(1) The percentages in this table have been rounded to the nearest whole number.
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(2) The weighted average life of a Class is determined by (a) multiplying the
amount of each payment of principal thereof by the number of years from the
date of issuance to the related Payment Date, (b) summing the results and
(c) dividing the sum by the aggregate distributions of principal referred to
in clause (a) and rounding to one decimal place.
DESCRIPTION OF THE OFFERED NOTES
GENERAL
The Notes will be issued pursuant to the terms of the Transaction Documents.
The following section contains summaries of the material terms of the
Transaction Documents. The summaries do not purport to be complete and are
subject to the provisions of the Transaction Documents. A copy of the Master
Trust Deed, and a form of each of the Series Notice, the Note Trust Deed and the
Security Trust Deed has been filed with the Commission as an Exhibit to the
Registration Statement of which this Prospectus is a part.
Pursuant to the Transaction Documents, on the Closing Date the Issuer
Trustee will issue two classes of notes (the "Offered Notes"), consisting of one
class of senior notes, designated as the Class A Mortgage Backed Floating Rate
Notes due [July][October] 19, , in the original principal amount of
US$[ ] (the "Class A Notes") and one class of subordinated notes,
designated as the Class B Mortgage Backed Floating Rate Notes, due
[July][October] 19, , in the original principal amount of US$[ ] (the
"Class B Notes"). In addition to the Class A Notes and the Class B Notes, the
Issuer Trustee may from time to time issue RFSs, which may convert to RFS Class
A Notes in certain circumstances. The Offered Notes, the RFSs and the RFS Class
A Notes are referred to herein as the "Notes." See "--Description of the Redraw
Facility, the Redraw Funding Securities and the RFS Class A Notes" herein.
Payments on the Notes will be made by the Note Trustee on each Payment Date
to persons in whose names the Notes are registered as of the related Record Date
(the "Holders" or "Noteholders"). The Payment Date for the Notes will be the
19th day of each Quarter. A "Quarter" is each three-month period in a year which
period begins on July 1, October 1, January 1 and April 1. If any Payment Date
would otherwise fall on a day which is not a Business Day, it shall be postponed
to the next day which is a Business Day unless it would thereby fall into the
next calendar month in which event it shall be brought forward to the
immediately preceding Business Day. The first Payment Date will be July 20, 1998
in respect of the period from (and including) the Closing Date to (but
excluding) that date. The Record Date for any Payment Date will be the second
Business Day immediately preceding the Payment Date (so long as the Notes are
held in book-entry form), or the last day of the prior calendar month (if
Definitive Notes have been issued).
A "Business Day" means (1) in relation to the Note Trust Deed, the Agency
Agreement and any Note, any day, other than a Saturday, Sunday or public
holiday, on which banks are open for business in Sydney, London and New York
City; and (2) in relation to any other Transaction Document, any day, other than
a Saturday, Sunday or public holiday, on which Banks are open for business in
Sydney. If a public holiday is occurring in any of the referenced locales, then
such day is not a Business Day, and no scheduled payments will be made on such
day.
A "Collection Period" commences on and includes the 10th day of each Quarter
and runs until (and includes) the 9th day of the following Quarter with the
exception of the first Collection Period, which will commence on (and include)
the day after the Cut-Off Date and end on (and include) [July 9], 1998.
The first Interest Period in relation to the Notes commences on (and
includes) the Closing Date and ends on (but excludes) the first Payment Date
(being [July 20], 1998). Each succeeding Interest Period, commences on (and
includes) a Payment Date and ends on (but excludes) the next Payment Date. The
final Interest Period ends on (but excludes) the Maturity Date.
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For any Interest Period other than the initial Interest Period, the
"Interest Determination Date" is the second Business Day prior to the
commencement of that Interest Period. The initial Interest Determination Date is
July 17, 1998. The "Collection Determination Date" is four Business Days prior
to each Payment Date.
Each Class of Offered Notes initially will be represented by one or more
global notes (the "Book-Entry Notes") registered in the name of the nominee of
DTC (together with any successor depository selected by the Note Trustee, the
"Depository"), except as set forth below. Beneficial interests in each Class of
Offered Notes will be available for purchase in minimum denominations of
US$100,000. The Issuer Trustee has been informed by DTC that DTC's nominee will
be Cede & Co. Accordingly, Cede & Co. is expected to be the Noteholder of record
of the Offered Notes. Unless and until Definitive Notes are issued under the
limited circumstances described herein, no Note Owner (as defined herein)
acquiring an interest in any Class of Offered Notes will be entitled to receive
a certificate representing such Note Owner's interest in such Notes. Until such
time, all references herein to actions by Noteholders of any Class of Offered
Notes will refer to actions taken by the Depository upon instructions from its
participating organizations and all references herein to distributions, notices,
reports and statements to Noteholders of any Class of Offered Notes will refer
to distributions, notices, reports and statements to the Depository or its
nominee, as the registered Noteholder of such Class, for distribution to Note
Owners of such Class in accordance with the Depository's procedures. See
"--Book-Entry Registration" and "--Definitive Notes."
The Issuer Trustee will maintain a Paying Agent in London until the date the
Offered Notes are redeemed.
COLLECTIONS AND PAYMENT
With respect to each Collection Period and on or prior to the Collection
Determination Date, the Trust Manager will determine the Collections (as defined
below) received and reconcile such receipts against expenses, including Interest
payable to Noteholders, that have accrued during such Collection Period. To the
extent necessary, the Trust Manager must direct the Issuer Trustee to draw on or
claim against the Liquidity Facility where available to make up shortfalls in
Collections due but not received. Various amounts will also be swapped under the
Swap Agreements.
On the Collection Determination Date, the Trust Manager shall advise the
Issuer Trustee of the amounts to be paid. The Issuer Trustee will arrange for
the relevant payments to occur on the Payment Date.
Set out below is an example of relevant dates and periods for the allocation
of cashflows and their payments. All dates are assumed to be Business Days.
<TABLE>
<S> <C>
Collection Period 10th April to (and including) 9th
July
Collection Determination Date 15th July
Remittance Date 17th July
Interest Determination Date 17th July
Notice Date 18th July
Payment Date/Rate Set Date 19th July
Interest Period 19th April to (but excluding) 19th
July
</TABLE>
COLLECTIONS
With respect to any Collection Period, "Collections" shall consist of
interest and principal receipts from the Housing Loans, the proceeds of
enforcement of Mortgages, the proceeds of claims under Mortgage Insurance
Policies and payments by the Approved Sellers or the Servicer in respect of
breaches of representations or warranties with respect to the Housing Loans.
Westpac or the Servicer, as a delegate
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of Westpac under the Servicing Agreement, will receive the Collections in
respect of the Housing Loans in the Mortgage Pool.
So long as both (a) Westpac has a short term rating of at least A-1+ from
Standard & Poor's, P-1 from Moody's and F-1+ from Fitch and (b) the Collections
Account is maintained with Westpac or a subsidiary of Westpac, each of Westpac
and the Servicer shall deposit the amount equal to the Collections it receives
during the related Collection Period into the relevant Collections Account two
Business Days prior to the relevant Payment Date (the "Remittance Date")
together with an amount equivalent to the interest that would have accrued at
the Bank Bill Rate on such amounts if such receipts had been deposited into the
Collections Account five Business Days following receipt by Westpac or the
Servicer (less any relevant tax).
If Westpac has a short term rating of less than A-1+ from Standard & Poor's,
less than P-1 from Moody's and less than A-1+ from Fitch, then Westpac and the
Servicer shall pay all Collections in its possession or control into the
Collections Account no later than five Business Days following receipt.
Notwithstanding the foregoing, the Collections Account may continue to be
maintained with Westpac for so long as it is an Approved Bank. An "Approved
Bank" means: (a) a Bank which has a short term rating of at least A-1+ from
Standard & Poor's, P-1 from Moody's and F-1+ from Fitch; or (b) any bank or
financial institution which is specified to be an Approved Bank in the Series
Notice, but means Westpac for so long as it has a short term rating of A-1 or
better from Standard & Poor's.
If, however, the Collections Account is not maintained with Westpac, or a
subsidiary of Westpac, all Collections in relation to the Trust must be
deposited into the Collections Account no later than two Business Days following
receipt thereof by Westpac or the Servicer (as the case may be).
CALCULATION OF TOTAL AVAILABLE FUNDS
On each Collection Determination Date the Trust Manager will, for the
immediately preceding Collection Period, calculate the total of the Available
Income, plus Principal Draws, plus Liquidity Draws (the sum of such amounts, the
"Total Available Funds"), all as further described below.
AVAILABLE INCOME
"Available Income" for a Collection Period equals the aggregate of:
(1) Finance Charge Collections plus to the extent not included in this
paragraph (1):
(2) any amount received or due to be received by or on behalf of the
Issuer Trustee with respect to net receipts under any Swap Agreement (other
than the Currency Swap);
(3) any amount received by or on behalf of the Issuer Trustee under any
Support Facility (other than the Currency Swap), including under a Mortgage
Insurance Policy, which the Trust Manager determines should be accounted for
in respect of a Finance Charge Loss;
(4) any interest income received by or on behalf of the Issuer Trustee
in respect of moneys credited to the Collections Account in relation to the
Trust;
(5) amounts in the nature of interest otherwise paid by Westpac, the
Servicer or the Trust Manager to the Issuer Trustee in respect of
Collections held by it;
(6) any net amount attributable to income from another WST trust
established under the Master Trust Deed with respect to the substitution of
a Housing Loan ("Substitution Net Transfer Amount (Income)"); and
(7) all other amounts received by or on behalf of the Issuer Trustee in
respect of the Trust assets in the nature of income,
excluding
(8) any interest credited to a Collateral Account for a Support
Facility; and
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(9) any amount received by the Issuer Trustee on entry into a
replacement Currency Swap which is payable to the prior Currency Swap
Providers.
"Finance Charge Collections" shall equal:
(1) all amounts received by or on behalf of the Issuer Trustee in
respect of interest, fees and other income payable under Housing Loans in
the Mortgage Pool, including:
(i) amounts on account of interest recovered from the enforcement of a
Housing Loan;
(ii) any payments by Westpac to the Issuer Trustee on the repurchase of
a Housing Loan which are attributable to interest;
(iii) any interest adjustments received by the Trust in relation to the
transfer of Housing Loans or related Mortgages from the Trust to
another WST trust; and
(iv) the Prepayment Cost Surplus for that Collection Period (if any);
and
(2) all amounts in respect of interest, fees and other amounts in the
nature of income, received by or on behalf of the Issuer Trustee during that
Collection Period including:
(i) from an Approved Seller or the Servicer in respect of any breach of
a representation, warranty or undertaking contained in the Master
Trust Deed, Servicing Agreement or Series Notice;
(ii) from an Approved Seller or the Servicer under any obligation under
the Master Trust Deed, Servicing Agreement or Series Notice to
indemnify or reimburse or pay damages to the Issuer Trustee for any
amount, in each case which are determined by the Trust Manager to
be in respect of interest; and
(3) any amount received in respect of a Housing Loan in the Mortgage
Pool, or a related Mortgage, after a Finance Charge Loss has occurred, which
has not been received under a Mortgage Insurance Policy and which is not
payable to an insurer under a Mortgage Insurance Policy; less
(4) any amount debited in respect of the Housing Loans in the Mortgage
Pool representing government charges collected by or on behalf of the Issuer
Trustee, financial institutions duty, bank accounts debit tax or similar
taxes and fees or charges due to the Servicer or Westpac under the Housing
Loans and the Prepayment Cost Surplus due to Westpac and collected by
Westpac or the Servicer.
With respect to any Housing Loan, a "Finance Charge Loss" means Liquidation
Losses which are attributable to interest, fees and expenses in relation to the
relevant Housing Loan including on the early discharge of Housing Loans which
bear a fixed rate of interest (other than a Housing Loan subject to a
concessional rate of interest for 12 months or less) the amount, if any, owed by
the relevant Borrower in accordance with the Relevant Documents. With respect to
any Housing Loan, "Liquidation Losses" for a Collection Period, means the amount
(if any) by which the Unpaid Balance of a Housing Loan (together with the
enforcement expenses relating to the Housing Loan and the related Mortgage)
exceeds the Liquidation Proceeds in relation to the Housing Loan. "Liquidation
Proceeds" means all amounts recovered from the enforcement of a Mortgage
(excluding proceeds of a Mortgage Insurance Policy).
With respect to any Housing Loan, a "Prepayment Cost Surplus" means, in
relation to a Collection Period, the amount by which the total of all Prepayment
Costs (as defined below) for that Collection Period exceeds the total of all
Prepayment Benefits for that Collection Period. With respect to any Housing
Loan, a "Prepayment Benefit Shortfall" means, in relation to a Collection
Period, the amount by which the total of all Prepayment Benefits for that
Collection Period exceeds the total of all Prepayment Costs for that Collection
Period.
With respect to any Housing Loan which is a Fixed Option Home Loan or
otherwise bears a fixed rate of interest (other than a Housing Loan subject to
an introductory rate of interest for 12 months or less), "Prepayment Cost"
means, on the early discharge of such Housing Loan, the amount (if any) owed by
the
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relevant Borrower and collected by Westpac or the Servicer, in accordance with
the relevant Housing Loan agreement with respect to such early discharge. With
respect to any Housing Loan which is a Fixed Option Home Loan or otherwise bears
a fixed rate of interest (other than a Housing Loan subject to an introductory
rate of interest for 12 months or less), a "Prepayment Benefit" means, on the
early discharge of such Housing Loan, the amount (if any) credited to the
relevant Borrower's loan account by Westpac by means of a reduction in the
Housing Loan Principal of that Housing Loan, in accordance with the relevant
Housing Loan agreement.
With respect to a Collection Period and any Housing Loan, "Principal Loss"
means the amount of any Liquidation Loss for that Collection Period which is
attributable to principal in relation to the relevant Housing Loan.
PRINCIPAL DRAWS
If the Trust Manager determines on any Collection Determination Date that
the Available Income of the Trust for the Collection Period ending immediately
prior to that Collection Determination Date is insufficient to meet Total
Payments (as defined herein under "--Remaining Liquidity Shortfall") of the
Trust for that Collection Period (a "Payment Shortfall"), then Principal
Collections collected during that Collection Period will be applied to the
Payment Shortfall (a "Principal Draw") to the extent available for this purpose.
Principal Draws will be reimbursed out of any Excess Available Income
available for this purpose on subsequent Payment Dates.
LIQUIDITY DRAWS
If, on any Collection Determination Date, the Trust Manager determines that
the related Payment Shortfall, if any, will not be covered fully by a Principal
Draw, the Trust Manager must direct the Issuer Trustee to draw on the Liquidity
Facility in an amount equal to the lesser of the remaining Payment Shortfall or
the Available Liquidity Amount. Any direction by the Trust Manager to the Issuer
Trustee to draw on the Liquidity Facility is subject to there being available
funds under the Liquidity Facility.
REMAINING LIQUIDITY SHORTFALL
If the amount available to be drawn under the Liquidity Facility is not
sufficient to satisfy the remaining Payment Shortfall in full, the amount of
such shortfall will be a "Remaining Liquidity Shortfall." If the Trust Manager
determines that a Remaining Liquidity Shortfall exists, then the Trust Manager
must reduce the Interest payable in respect of the Notes as follows:
(1) first, reduce the A$ Class B Interest Amount payable to the Currency
Swap Provider under the swap confirmation relating to the Class B Notes;
(2) second, if the A$ Class B Interest Amount has been reduced to zero,
any excess Remaining Liquidity Shortfall shall reduce pro rata, based on
their applicable entitlements:
(i) the A$ Class A Interest Amount payable to the Currency Swap
Providers under the swap confirmation relating to the Class A Notes;
(ii) the RFS Interest for all RFSs (if any);
(iii) interest payable for all RFS Class A Notes (if any); and
(iv) any fee payable by the Issuer Trustee under the Redraw Facility.
If there is a reduction in the A$ Class B Interest Amount under (1) above,
the Interest entitlement of the Class B Noteholders shall be reduced by the same
proportion as the reduction in the A$ Class B Interest Amount. If there is a
reduction in the A$ Class A Interest Amount under (2)(i) above, the Interest
entitlement of the Class A Noteholders shall be reduced by the same proportion
as the reduction in the A$ Class A Interest Amount.
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With respect to any Payment Date, the "A$ Class A Interest Amount" means the
amount in A$ which is calculated:
(1) on a daily basis at the applicable rate set out in the swap
confirmation relating to the Class A Notes (being AUD- BBR-BBSW, as defined
in the ISDA Definitions, as at the first day of the Interest Period ending
on (but excluding) that Payment Date with a designated maturity of 90 days
plus the spread set out in the Currency Swap);
(2) on the A$ Equivalent (with respect to an amount denominated or to be
denominated in U.S. dollars, the amount converted to (and denominated in)
Australian dollars at the applicable exchange rate) of the aggregate of the
Invested Amount of the Class A Notes as at the first day of the Interest
Period ending on (but excluding) that Payment Date; and
(3) on the basis of the actual number of days in that Interest Period
and a year of 360 days.
With respect to any Payment Date, the "A$ Class B Interest Amount" means,
for any Payment Date, the amount in A$ which is calculated:
(1) on a daily basis at the applicable rate set out in the swap
confirmation relating to the Class B Notes (being AUD- BBR-BBSW, as defined
in the ISDA Definitions, as at the first day of the Interest Period ending
on (but excluding) that Payment Date with a designated maturity of 90 days
plus the spread);
(2) on the A$ Equivalent of the aggregate of the Invested Amount of the
Class B Notes as at the first day of the Interest Period ending on (but
excluding) that Payment Date; and
(3) on the basis of the actual number of days in that Interest Period
and a year of 360 days.
With respect to any Payment Date, "RFS Interest" means all interest on the
outstanding RFSs in respect of an Interest Period. With respect to any Payment
Date, "RFS Class A Interest" means all interest on the outstanding RFS Class A
Notes in respect of an Interest Period.
DISTRIBUTION OF TOTAL AVAILABLE FUNDS
GENERAL
On each Payment Date, the Trust Manager shall instruct the Issuer Trustee to
apply the Total Available Funds in making the following payments in respect of
the preceding Collection Period in the following order of priority:
(1) in relation to the first Payment Date only, the Accrued Interest
Adjustment;
(2) unpaid or unreimbursed Trust Expenses;
(3) amounts payable under any Support Facility (other than the Currency
Swap), pro rata, based on their respective entitlements, including:
(i) the net amount (if any) payable by the Issuer Trustee under the
Variable Rate Basis Swap;
(ii) the net amount (if any) payable by the Issuer Trustee under each
Fixed Rate Basis Swap; and
(iii) any interest or fees payable by the Issuer Trustee under the
Liquidity Facility,
but not including amounts due under paragraph (4), (5) or (6) below;
(4) repayment of any Liquidity Draw made on or prior to the previous
Payment Date;
(5) pro rata, to each of the following, based on their respective
entitlements:
(i) any interest payable on all RFSs (if any);
(ii) the payment to the Currency Swap Providers under the swap
confirmation relating to the Class A Notes of the A$ Class A
Interest Amount at that date;
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(iii) the interest payable on all RFS Class A Notes (if any); and
(iv) any fee payable by the Issuer Trustee under the Redraw Facility;
and
(6) the payment to the Currency Swap Providers under the swap
confirmation relating to the Class B Notes of the A$ Class B Interest Amount
as at that date.
The sum of paragraphs (1) to (6) above represents "Total Payments" for a
Collection Period.
The Issuer Trustee shall only make a payment described in paragraphs (1)
through (6) above to the extent that Total Available Funds remain available to
do so after each payment is made in accordance with the above priority in
accordance with the Series Notice.
TRUST EXPENSES
On each Collection Determination Date the Trust Manager will determine the
following payments to be made for the relevant Collection Period (together, the
"Trust Expenses") in the following order of priority (as between themselves) on
the next Payment Date:
(1) taxes payable in relation to the Trust;
(2) the Issuer Trustee Fee;
(3) the Trust Manager Fee;
(4) any fee payable to the Security Trustee under the Security Trust
Deed;
(5) the Servicing Fee;
(6) any fee payable to the Note Trustee under the Note Trust Deed;
(7) any fee payable to the Agent Bank under the Agency Agreement;
(8) pro rata based on their respective entitlements any costs, charges
or expenses (other than fees) incurred by, and any liabilities owing under
any indemnity granted to, the Security Trustee, the Servicer, the Note
Trustee or the Agent Bank in relation to the Trust under the Transaction
Documents, for that Collection Period; and
(9) pro rata based on their respective entitlements any other costs,
charges or expenses incurred by the Issuer Trustee or the Trust Manager in
the administration or operation of the Trust.
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CALCULATION OF INTEREST PAYABLE ON THE NOTES
The "Interest Rate" for the Class A Notes for a particular Interest Period
is equal to USD-LIBOR-BBA on the related Interest Determination Date (as defined
herein) plus %. The Interest Rate on the Class A Notes for the first Interest
Period will be equal to %. The "Interest Rate" for the Class B Notes for a
particular Interest Period is equal to USD- LIBOR-BBA on the related Interest
Determination Date plus %. The Interest Rate on the Class B Notes for the
first Interest Period will be equal to %. See "--Calculation of
USD-LIBOR-BBA" below.
With respect to any Payment Date, interest on a Class of Notes will be
calculated as the product of (a) the Invested Amount of such Class as of the
first day of that Interest Period after giving effect to any payments of
principal made with respect to such Class on such day, (b) the Interest Rate for
such Class for that Interest Period; and (c) a fraction, the numerator of which
is the actual number of days in that Interest Period and the denominator of
which is 360 days (such product, "Interest"). No Noteholder will be entitled to
payments of Interest after the related Stated Amount is reduced to zero.
CALCULATION OF USD-LIBOR-BBA
On the second London banking day before the beginning of each Interest
Period (each an "Interest Determination Date"), the Agent Bank will determine
the "USD-LIBOR-BBA" as the applicable Floating Rate Option under the Definitions
of the International Swaps and Derivatives Association, Inc. ("ISDA") (the "ISDA
Definitions") being the rate applicable to any Interest Period for three-month
deposits in U.S. dollars which appears on the Telerate Page 3750 as of 11:00
A.M., London time, on the Interest Determination Date. If such rate does not
appear on the Telerate Page 3750, the rate for that Interest Period will be
determined as if the Issuer Trustee and Agent Bank had specified
"USD-LIBOR-Reference Banks" as the applicable Floating Rate Option under the
ISDA Definitions. "USD-LIBOR-Reference Banks" means that the rate for an
Interest Period will be determined on the basis of the rates at which deposits
in U.S. Dollars are offered by the Reference Banks (being four major banks in
the London interbank market) at approximately 11:00 A.M., London time, on the
Interest Determination Date to prime banks in the London interbank market for a
period of three months commencing on the first day of the Interest Period and in
a Representative Amount (as defined in the ISDA Definitions). The Agent Bank
will request the principal London office of each of the Reference Banks to
provide a quotation of its rate. If at least two such quotations are provided,
the rate for that Interest Period will be the arithmetic mean of the quotations.
If fewer than two quotations are provided as requested, the rate for that
Interest Period will be the arithmetic mean of the rates quoted by major banks
in New York City, selected by the Agent Bank, at approximately 11:00 A.M., New
York City time, on that Interest Determination Date for loans in U.S. dollars to
leading European banks for a period of three months commencing on the first day
of the Interest Period and in a Representative Amount, provided that on the
first day of the first Interest Period USD-LIBOR-BBA shall be an interpolated
rate calculated with reference to the period from (and including) the Closing
Date to (but excluding) the first Payment Date.
EXCESS AVAILABLE INCOME
GENERAL
On each Collection Determination Date, the Trust Manager must determine the
amount (if any) by which the Total Available Funds for the Collection Period
ending immediately prior to that Collection Determination Date exceeds the Total
Payments for that same Collection Period (such amount, the "Excess Available
Income").
DISTRIBUTION OF EXCESS AVAILABLE INCOME
On each Collection Determination Date, the Trust Manager must apply such
Excess Available Income for the Collection Period relating to that Collection
Determination Date in the following order of priority:
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(1) to reimburse Principal Charge Offs for that Collection Period;
(2) pro rata, based on the Stated Amount of the RFSs (if any), the
Stated Amount of the RFS Class A Notes (if any), the Principal Outstanding
under the Redraw Facility and the A$ Equivalent of the Stated Amount of the
Class A Notes:
(i) as a payment to the holders of the RFSs (if any) in or towards
reinstating the Stated Amount of such RFSs, to the extent of any
Carryover RFS Charge Offs;
(ii) as a payment to the holders of the RFS Class A Notes (if any) in
or towards reinstating the Stated Amount of such RFS Class A Notes, to
the extent of any Carryover RFS Class A Charge Offs;
(iii) as a repayment under the Redraw Facility Agreement, as a
reduction of, and to the extent of, any Carryover Redraw Charge Offs;
(iv) as a payment to the Currency Swap Providers under the swap
confirmation relating to the Class A Notes, of the A$ Equivalent of any
Carryover Class A Charge Offs; and
(3) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmation relating to the Class B Notes of the A$
Equivalent of any Carryover Class B Charge Offs;
(4) to all Principal Draws which have not been repaid as at that date;
and
(5) as a distribution to any Beneficiaries (an "Excess Collections
Distribution").
All amounts to be paid pursuant to paragraphs (2), (3) and (5) will be paid
on the Payment Date immediately following the Collection Determination Date.
Once distributed to a Beneficiary, an Excess Collections Distribution will
not be available to the Issuer Trustee to meet its obligations in respect of the
Trust in subsequent periods unless there has been an error in the relevant
calculation of the Excess Collections Distribution. A "Beneficiary" is any party
which holds a residual income unit in the Trust.
GROSS PRINCIPAL COLLECTIONS
On each Collection Determination Date, the Trust Manager must determine
Gross Principal Collections for the Collection Period ending immediately prior
to that Collection Determination Date. With respect to any Collection
Determination Date, "Gross Principal Collections" are the sum of:
(1) all amounts received by or on behalf of the Issuer Trustee under or
in respect of the Housing Loans during the Collection Period in respect of
principal, including principal prepayments;
(2) all other amounts received under or in respect of the Housing Loans
during the Collection Period in respect of principal, including:
(i) amounts on account of principal recovered from the enforcement of
a Housing Loan or Mortgage;
(ii) any payments by Westpac to the Issuer Trustee on the repurchase
of a Housing Loan in respect of principal;
(iii) any amounts in the nature of principal received by or on behalf
of the Issuer Trustee from the sale of any Trust Asset, including any
amount received on the issue of Notes and which was not used to purchase
a Housing Loan or Mortgage and which the Trust Manager determines is
surplus to the requirements of the Trust;
(iv) any Prepayment Costs applied towards Prepayment Benefit; and
(v) any Prepayment Benefit Shortfall paid by Westpac to the Trust;
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(3) all amounts received by or on behalf of the Issuer Trustee during
that Collection Period under any Support Facility (other than the Currency
Swap) which the Trust Manager determines should be accounted for to reduce a
Principal Loss;
(4) all amounts received by or on behalf of the Issuer Trustee during
that Collection Period:
(i) from an Approved Seller or the Servicer in respect of any breach
of a representation, warranty or undertaking contained in the Master
Trust Deed, Series Notice or Servicing Agreement determined by the Trust
Manager to be in respect of principal; and
(ii) from an Approved Seller or the Servicer under any obligation
under the Master Trust Deed, Series Notice or Servicing Agreement to
indemnify, reimburse or pay damages to the Issuer Trustee for any amount
determined by the Trust Manager to be in respect of principal;
(5) any amount of Excess Available Income to be applied to meet a
Principal Charge Off or a Carryover Charge Off;
(6) any amount received by or on behalf of the Issuer Trustee during
that Collection Period as proceeds from the issue of any RFS to the extent
not applied to reimburse amounts drawn under the Redraw Facility;
(7) any Excess Available Income to be applied to Principal Draws made on
a previous Payment Date;
(8) any Prepayment Calculation Adjustment for that Collection Period;
and
(9) any net amount attributable to principal received by the Trust from
another trust established under the Master Trust Deed with respect to any
substitution of a Housing Loan during that Collection Period ("Substitution
Net Transfer Amount (Principal))";
but excluding a premium receivable by the Issuer Trustee on entry into a
replacement Currency Swap.
On the Closing Date, the A$ Equivalent of the total Initial Invested Amount
of the Notes issued by the Issuer Trustee may exceed the Housing Loan Principal
as of the Cut-Off Date. The amount of this difference, if any, will be treated
as a Gross Principal Collection and the US$ Equivalent will be passed through to
Noteholders on the first Payment Date.
With respect to any Collection Period and a Housing Loan, a "Prepayment
Calculation Adjustment" is any amount credited to the related Borrower by
Westpac to reflect an interest adjustment resulting from a change in computer
systems.
PRINCIPAL COLLECTIONS
On each Collection Determination Date the Trust Manager must calculate
Principal Collections for the preceding Collection Period. With respect to any
Collection Determination Date, "Principal Collections" shall be equal to:
(1) the Gross Principal Collections for that Collection Period; less
(2) any amounts deducted by or paid to Westpac to reimburse Redraws
funded by Westpac during that Collection Period for which Westpac has not
been reimbursed previously.
DISTRIBUTION OF PRINCIPAL COLLECTIONS
INITIAL PRINCIPAL DISTRIBUTIONS
On each Payment Date, Principal Collections will be distributed in the
following order of priority:
(1) to repay any Redraws provided by Westpac to the extent not
previously reimbursed;
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(2) to repay any Principal Outstanding under the Redraw Facility;
(3) to allocate to Total Available Funds any Principal Draw; and
(4) to repay all amounts outstanding under each RFS Series (if any), in
chronological order of issue, until repaid in full,
(together, "Initial Principal Distributions").
Only after Initial Principal Distributions have been distributed will
Principal Collections be available to be paid to the Currency Swap Providers to
enable the Issuer Trustee to make payments to the Class A Noteholders and the
Class B Noteholders in US$ in accordance with the appropriate principal
allocation methodology set forth below. With respect to any Payment Date, "Net
Principal Collections" shall equal the amount of Principal Collections remaining
after the distribution of Initial Principal Distributions.
PAYMENTS OF PRINCIPAL ON THE NOTES
With respect to any Collection Determination Date, the Trust Manager shall
determine the appropriate principal allocation methodology as set forth below.
On each Payment Date, the Trust Manager shall instruct the Issuer Trustee to pay
principal to the Noteholders in the manner and subject to the priority set forth
below.
SERIAL METHOD 1
If, on the related Collection Determination Date, the Serial Method 1
Distribution Test has been met, then the Issuer Trustee will pay out of any Net
Principal Collections, on the immediately following Payment Date the following
amounts in the following order of priority:
(1) first, pro rata, based on their respective entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmation relating to the Class A Notes of an amount
equal to the lesser of:
(a) the Class A Forex Percentage of the sum of: (1) the Class A
Percentage of Net Principal Collections; and (2) 50% of the Class B
Percentage of Net Principal Collections; and
(b) the A$ Equivalent of the Class A Stated Amounts for all Class
A Notes; and
(ii) as a payment denominated in A$ to the holders of the RFS Class A
Notes (if any) of an amount equal to the lesser of:
(a) the RFS Class A Forex Percentage of the sum of: (1) the Class
A Percentage of Net Principal Collections; and (2) 50% of the Class B
Percentage of Net Principal Collections; and
(b) the RFS Class A Stated Amounts for all RFS Class A Notes (if
any); and
(2) second, as a payment, denominated in A$, to the Currency Swap
Providers under the swap confirmation relating to the Class B Notes of an
amount equal to 50% of the Class B Percentage of Net Principal Collections.
The "Serial Method 1 Distribution Test" is met if, on any Collection
Determination Date the following conditions are all satisfied:
(i) the Subordinated Percentage at the previous Collection
Determination Date was greater than or equal to % (twice the Initial
Subordinated Percentage);
(ii) that Collection Determination Date occurs on or before April 19,
2001;
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(iii) the fraction, expressed as a percentage, the numerator of which
is the Total Invested Amount on such Collection Determination Date and
the denominator of which is the Total Initial Invested Amount, is greater
than or equal to 10%; and
(iv) the Average Quarterly Percentage on such Collection
Determination Date:
(a) does not exceed [2]% and the Total Carryover Charge Off on
that Collection Determination Date does not exceed [30]% of the Class
B Initial Invested Amount; or
(b) does not exceed [4]% and the Total Carryover Charge Off on
such Collection Determination Date does not exceed [10]% of the Class
B Initial Invested Amount; and
(v) the Stated Amount of the Class B Notes on such Collection
Determination Date exceeds 0.25% of the sum of the Class A Initial
Invested Amount and the Class B Initial Invested Amount.
SERIAL METHOD 2
If, on the related Collection Determination Date, the Serial Method 2
Distribution Test has been met, then the Issuer Trustee will pay out of any Net
Principal Collections, on the immediately following Payment Date the following
amounts in the following order of priority:
(1) first, pro rata, based on their respective entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmation relating to the Class A Notes of an amount
equal to the lesser of:
(a) the Class A Forex Percentage of the Class A Percentage of Net
Principal Collections; and
(b) the A$ Equivalent of the Class A Stated Amounts for all Class
A Notes; and
(ii) as a payment denominated in A$ to the holders of the RFS Class A
Notes (if any) of an amount equal to the lesser of:
(a) the RFS Class A Forex Percentage of the Class A Percentage of
Net Principal Collections; and
(b) the RFS Class A Stated Amounts for all RFS Class A Notes (if
any); and
(2) second, as a payment, denominated in A$, to the Currency Swap
Providers under the swap confirmation relating to the Class B Notes of an
amount equal to the Class B Percentage of Net Principal Collections.
The "Serial Method 2 Distribution Test" is met if, on any Collection
Determination Date the following conditions are all satisfied:
(i) the Subordinated Percentage at the previous Collection
Determination Date was greater than or equal to % (twice the Initial
Subordinated Percentage);
(ii) that Collection Determination Date occurs after April 19, 2001,
(iii) the fraction, expressed as a percentage, the numerator of which
is the Total Invested Amount on such Collection Determination Date and
the denominator of which is the Total Initial Invested Amount, is greater
than or equal to 10%;
(iv) the Average Quarterly Percentage as at the Collection
Determination Date:
(a) does not exceed 2% and the Total Carryover Charge Off on that
Collection Determination Date does not exceed 30% of the Class B
Initial Invested Amount; or
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(b) does not exceed 4% and the Total Carryover Charge Off on that
Collection Determination Date does not exceed 10% of the Class B
Initial Invested Amount; and
(v) the Stated Amount of the Class B Notes on such Collection
Determination Date exceeds 0.25% of the sum of (x) the Class A Initial
Invested Amount, (y) the Class B Initial Invested Amount and (z) the US$
Equivalent of the Invested Amounts of all RFS Class A Notes (if any).
SEQUENTIAL METHOD
If neither the Serial Method 1 Distribution Test nor the Serial Method 2
Distribution Test has been met, then the Issuer Trustee will pay out of any Net
Principal Collections, on the immediately following Payment Date the following
amounts in the following order of priority:
(1) first, pro rata, based on their respective entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmation relating to the Class A Notes of an amount
equal to the lesser of:
(a) the Class A Forex Percentage of the Net Principal
Collections; and
(b) the A$ Equivalent of the Class A Stated Amounts for all Class
A Notes; and
(ii) as a payment denominated in A$ to the holders of the RFS Class A
Notes (if any) of an amount equal to the lesser of:
(a) the RFS Class A Forex Percentage of the Net Principal
Collections; and
(b) the RFS Class A Stated Amounts for all RFS Class A Notes (if
any); and
(2) second, as a payment, denominated in A$, to the Currency Swap
Providers under the swap confirmation relating to the Class B Notes of an
amount equal to the lesser of (i) the amount remaining after all
distributions in (1) above and (ii) the A$ Equivalent of the Class B Stated
Amounts for all Class B Notes.
CERTAIN RELATED DEFINITIONS
With respect to any date, the "Average Quarterly Percentage" is the sum of
the Quarterly Percentages for the four full Quarters preceding that date,
divided by four. With respect to any Collection Period, the "Quarterly
Percentage" equals a fraction, expressed as a percentage, the numerator of which
is the aggregate Housing Loan Principal of all Housing Loans which are
Delinquent for more than 60 consecutive days as of the close of business on the
last day of that Collection Period, and the denominator of which is the
aggregate Housing Loan Principal of all Housing Loans as of the close of
business on the last day of that Collection Period. With respect to any Housing
Loan and date, "Housing Loan Principal" shall be the unpaid principal amount of
that Housing Loan on such date.
The "Class A Forex Percentage" equals a fraction, expressed as a percentage,
the numerator of which is the A$ Equivalent of the Class A Stated Amounts at
that date and the denominator of which is the sum of the A$ Equivalent of the
Class A Stated Amounts and the RFS Class A Stated Amounts at that date.
The "Class A Percentage" means, on a Collection Determination Date, the sum
of the aggregate of the A$ Equivalent of the Class A Stated Amounts, the RFS
Class A Stated Amounts and the Redraw Limit (as defined herein) for the
preceding Collection Determination Date as a percentage of the sum of the
aggregate of the A$ Equivalent of the Class A Stated Amounts, the RFS Class A
Stated Amounts and the Class B Stated Amounts and the Redraw Limit calculated as
at the preceding Collection Determination Date. The "Class B Percentage" means,
on a Collection Determination Date, the aggregate of the A$ Equivalent of the
Class B Stated Amounts for the preceding Collection Determination Date as a
percentage of the sum of the aggregate A$ Equivalent of the Class A Stated
Amounts, the RFS Class A
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Stated Amounts and the Class B Stated Amounts and the Redraw Limit calculated as
at the preceding Collection Determination Date.
The "Initial Subordinated Percentage" shall be %.
With respect to any date, the "RFS Class A Forex Percentage" shall be 100%
minus the Class A Forex Percentage as of that date.
The "Subordinated Percentage" means the fraction, expressed as a percentage,
calculated on each Collection Determination Date by the Trust Manager by the
numerator of which is the A$ Equivalent of the aggregate of the Class B Stated
Amounts and the denominator of which is the sum of (i) the A$ Equivalent of the
aggregate of the A$ Equivalent of the Class A Stated Amounts, the RFS Class A
Stated Amounts and the Class B Stated Amounts at that time, plus (ii) the Redraw
Limit at that time, plus (iii) the aggregate of the RFS Stated Amounts at that
time, plus (iv) the aggregate of the RFS Class A Stated Amounts at that time.
APPLICATION OF PRINCIPAL CHARGE OFFS
GENERAL
If there is any Liquidation Loss under a Housing Loan, the Trust Manager
will direct the Servicer to make a claim under the relevant Mortgage Insurance
Policy for the aggregate amount of that Liquidation Loss if the Servicer has not
already done so. If a claim on account of a Principal Loss may not be made (or
is reduced) under the Mortgage Insurance Policy for any reason (including
because the maximum amount available under the Mortgage Pool Insurance Policy
has been exhausted, the Mortgage Insurance Policy has been terminated in respect
of that Housing Loan, the Mortgage Insurer is entitled to reduce the amount of
the claim or the Mortgage Insurer defaults in payment of a claim) then a
"Mortgage Shortfall" will arise if:
(1) the total amount recovered and recoverable under the Mortgage
Insurance Policy attributable to principal; plus
(2) any damages or other amounts payable by an Approved Seller or the
Servicer under or in respect of the Master Trust Deed, the Series Notice or
Servicing Agreement relating to the Housing Loan which the Trust Manager
determines to be on account of principal, is insufficient to meet the full
amount of the Principal Loss. In that case, the aggregate amount of all
Mortgage Shortfalls for that Collection Period (a "Principal Charge Off")
will be applied to reduce the Stated Amounts of the Notes as described
below.
CHARGE OFFS
On any Collection Determination Date, the Excess Available Income (if any)
will be applied to meet Principal Charge Offs calculated on that Collection
Determination Date for the Collection Period ending immediately prior to that
Collection Determination Date. If the amount of Excess Available Income is less
than the amount of those Principal Charge Offs, then the balance of the
Principal Charge Offs will be:
(1) applied to reduce the Stated Amounts of the Class B Notes by the US$
Equivalent of that balance (a "Class B Charge Off"), until the Class B
Stated Amount is zero; and
(2) to the extent that balance cannot be applied under paragraph (1)
because the Class B Stated Amount is zero, applied pro rata, based on their
respective Stated Amounts or Principal Outstanding, as applicable, to the
reduction of the RFSs (if any) (an "RFS Charge Off"), the RFS Class A Notes
(if any) (an "RFS Class A Charge Off") and the Class A Notes (a "Class A
Charge Off") until the respective Stated Amounts of the Class A Notes, the
RFSs (if any) and the RFS Class A Notes (if any) are zero and the Principal
Outstanding under the Redraw Facility until the Principal Outstanding is
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zero (a "Redraw Facility Charge Off") (using A$ Equivalent amounts in the
case of the Class A Notes).
With respect to any date, the "Total Carryover Charge Off" means the sum of:
(1) all Carryover Class A Charge Offs for all Class A Notes (other
than RFS Class A Notes) as at that date;
(2) all Carryover Class B Charge Offs for all Class B Notes as at
that date;
(3) the US$ Equivalent of all Carryover RFS Charge Offs for all RFSs
as at that date; and
(4) the US$ Equivalent of all Carryover RFS Class A Charge Offs for
all RFS Class A Charge Offs as at that date.
REIMBURSEMENT OF CHARGE OFFS
On any Collection Determination Date, if there is Excess Available Income in
respect of the Collection Period ending immediately prior to that Collection
Determination Date remaining after the reimbursement of any Principal Charge
Offs for that Collection Period, then the remaining Excess Available Income will
be used to reinstate the Stated Amounts of the Notes in the following priority:
(1) first, the Carryover Redraw Charge Offs, Carryover RFS Charge Offs,
Carryover RFS Class A Charge Offs and Carryover Class A Charge Offs, pro
rata based on the amount of their respective Charge Offs (using A$
Equivalent amounts in the case of Carryover Class A Charge Offs); and
(2) second, the A$ Equivalent of any Carryover Class B Charge Offs.
On any Collection Determination Date in relation to a Class A Note,
"Carryover Class A Charge Offs" means the aggregate of Class A Charge Offs in
relation to that Class A Note prior to that Collection Determination Date which
have not been reinstated as provided for herein. On any Collection Determination
Date in relation to a Class B Note, "Carryover Class B Charge Offs" means on any
Collection Determination Date in relation to a Class B Note, the aggregate of
Class B Charge Offs in relation to that Class B Note prior to that Collection
Determination Date which have not been reinstated as provided for herein. On any
Collection Determination Date in relation to the Redraw Facility, "Carryover
Redraw Charge Offs" means, the aggregate of Redraw Charge Offs prior to that
Collection Determination Date which have not been reinstated as provided for
herein. On any Collection Determination Date in relation to the RFSs, the
aggregate of RFS Charge Offs in relation to that RFS prior to that Collection
Determination Date which have not been reinstated as provided for herein. On any
Collection Determination Date in relation to an RFS Class A Note, "Carryover RFS
Class A Charge Offs" means the aggregate of RFS Class A Charge Offs in relation
to that RFS Class A Note prior to that Collection Determination Date which have
not been reinstated as provided for herein.
PAYMENTS INTO US$ ACCOUNT
The Principal Paying Agent shall open and maintain, or cause to be opened
and maintained, an account (the "US$ Account") into which the Currency Swap
Providers shall deposit amounts denominated in US$.
(1) The Issuer Trustee shall direct the Currency Swap Providers to pay
all amounts denominated in US$ payable to the Issuer Trustee by the Currency
Swap Providers under the Currency Swap into the US$ Account or to the
Principal Paying Agent under the Agency Agreement on behalf of the Issuer
Trustee.
(2) If any of the Issuer Trustee, the Trust Manager or the Servicer
receives any amount denominated in US$ from the Currency Swap Providers
under the Currency Swap they will promptly pay that amount to the credit of
the US$ Account.
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PAYMENTS OUT OF US$ ACCOUNT
The Issuer Trustee shall, or shall require that the Paying Agents shall on
its behalf, pay all amounts credited to the US$ Account or otherwise referred to
above to meet its US$ obligations under the Series Notice and the Notes, and in
accordance with the Note Trust Deed and the Agency Agreement.
PREPAYMENT COSTS AND PREPAYMENT BENEFITS
(1) On each Collection Determination Date the Trust Manager will determine
total Prepayment Benefits and total Prepayment Costs for the relevant Collection
Period and will apply an amount equal to those total Prepayment Costs in payment
of those total Prepayment Benefits. If:
(i) there is a Prepayment Cost Surplus, it will be applied under
paragraph (2) below; and
(ii) there is a Prepayment Benefit Shortfall, it will be funded under
paragraph (3) below.
(2) On each Payment Date based on calculations provided to it by the Trust
Manager, the Issuer Trustee will pay to Westpac an amount equal to the
Prepayment Cost Surplus (if any) for the Collection Period on that Payment Date
to the extent received by or on behalf of the Issuer Trustee.
(3) If, on any Collection Determination Date, the Trust Manager calculates
that there is a Prepayment Benefit Shortfall, the Trust Manager must by the
close of business on that Collection Determination Date notify Westpac of the
amount of that Prepayment Benefit Shortfall. Westpac must, by 4:00 p.m. (Sydney
time) on the Remittance Date, deposit in the Collections Account for the credit
of the Issuer Trustee an amount equal to that Prepayment Benefit Shortfall. That
amount will be treated as a Gross Principal Collection.
DESCRIPTION OF THE REDRAW FACILITY, THE REDRAW FUNDING SECURITIES AND THE RFS
CLASS A NOTES
Certain Housing Loans in the Mortgage Pool which are charged a variable rate
of interest have the benefit of a facility which allows the borrower to draw on
repayments made by the Borrower in excess of scheduled repayments on the related
Housing Loan (any such draw, a "Redraw"). Borrowers may require Westpac to
re-advance to them previously prepaid principal. In certain circumstances,
Westpac has a contractual obligation under the related loan document to provide
the Redraw if the Borrower has made prepayments on the related Housing Loan and
such Borrower is not delinquent. A Redraw will not result in the Housing Loan
being removed from the Mortgage Pool.
Westpac is entitled to be reimbursed by the Issuer Trustee for Redraws
funded by Westpac first, from Gross Principal Collections as described herein
under "--Principal Collections" herein, second, from drawings under the Redraw
Facility and third, from the proceeds of the issue of RFSs (if any), to the
extent each is available.
If Westpac is not fully reimbursed in relation to a Redraw, it will bear the
cost of funding that Redraw until such time as it can be reimbursed by the
Issuer Trustee.
REDRAW FACILITY
GENERAL
On or prior to the Closing Date, Westpac will enter into a Redraw Facility
Agreement (the "Redraw Facility Agreement") in its capacity as "Redraw Facility
Provider" with the Issuer Trustee and Trust Manager. Pursuant to the terms of
the Redraw Facility Agreement, the Redraw Facility Provider shall be obligated,
subject to the limitations set forth below, to fund the amount of any Redraws
not funded with Gross Principal Collections. To the extent that Gross Principal
Collections are insufficient to fund Redraws (a "Redraw Shortfall") and amounts
are available under the Redraw Facility, the Trust Manager must direct the
Issuer Trustee to draw on the Redraw Facility. Under the Redraw Facility, the
Redraw Facility
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Provider agrees to make advances to the Issuer Trustee up to the limit from time
to time (the "Redraw Limit") or any lesser amount as agreed between the Redraw
Facility Provider, the Issuer Trustee and the Trust Manager. At the Closing
Date, the Redraw Limit is expected to be A$ . The Redraw Limit may not be
increased without written confirmation from the Rating Agencies that the
increase would not result in a downgrading or withdrawal of the rating for the
Offered Notes then outstanding.
The Redraw Facility Provider may revoke the Redraw Facility at any time
immediately on giving notice to the Issuer Trustee and the Trust Manager.
DRAWINGS
In the event of a Redraw Shortfall on any Collection Determination Date, the
Trust Manager must direct the Issuer Trustee to draw down on the Redraw Facility
for an amount (a "Redraw Advance") equal to the lesser of the Redraw Shortfall
and the Available Redraw Amount (as defined herein). A drawing may only be made
under the Redraw Facility on account of a Redraw Shortfall.
"Available Redraw Amount" means at any time the greater of: (a) the Redraw
Limit at such time less (i) the Principal Outstanding at that time; and (ii) the
Carryover Redraw Charge Offs at that time; and (b) zero. The sum of all Redraw
Advances outstanding on any particular date less the Carryover Redraw Charge
Offs at that time shall be the "Principal Outstanding."
A drawing may only be made by the Issuer Trustee giving to the Redraw
Facility Provider a duly completed drawdown notice signed by the Issuer Trustee;
provided, however, that each of the following conditions precedent to drawing
are met.
CONDITIONS PRECEDENT TO DRAWING
The obligations of the Redraw Facility Provider to make available each
Redraw Advance are subject to the conditions precedent that:
(1) no event of default has occurred and is continuing under the Redraw
Facility at the date of the relevant drawdown notice and the relevant drawdown
date or will result from the provision of the Redraw Advance; and
(2) the representations and warranties by the Issuer Trustee in the Redraw
Facility are true as at the date of the relevant drawdown notice and the
relevant drawdown date as though they had been made at that date in respect of
the facts and circumstances then subsisting.
DRAW FEE
With respect to any Redraw Advance made by the Redraw Facility Provider, a
fee (the "Draw Fee") will accrue from day to day on the amount of each such
Redraw Advance from the date of its advance at a rate equal to the Bank Bill
Rate plus a margin (which varies depending on how long the Redraw Advance is
outstanding), calculated on the basis of the actual number of days elapsed since
the advance and a year of 365 days. The Draw Fee shall be payable on each
Payment Date and on termination of the Redraw Facility. To the extent any Draw
Fee is not paid, the amount of such unpaid Draw Fee will be capitalized and
interest will accrue on any such unpaid Draw Fee. On any date, the "Bank Bill
Rate" shall be the rate calculated by taking the rates quoted on the Reuters
Screen BBSW Page at approximately 10:00 am, Sydney time, on that date for each
Reference Bank so quoting (but not fewer than five) as being the mean buying and
selling rate for a bill (which for the purpose of this definition means a bill
of exchange of the type specified for the purpose of quoting on the Reuters
Screen BBSW Page) having a tenor of 90 days eliminating the highest and lowest
mean rates and taking the average of the remaining mean rates and then (if
necessary) rounding the resultant figure upwards to four decimal places. If on
any date fewer than five Reference Banks have quoted rates on the Reuters Screen
BBSW Page, the rate for that date shall be calculated as above by taking the
rates otherwise quoted by five of the Reference Banks on application by
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the parties for such a bill of the same tenor. If in respect of any date the
rate for that date cannot be determined in accordance with the foregoing
procedures then the rate for that date shall mean such rate as is agreed between
the Trust Manager and Westpac having regard to comparable indices then
available, provided that on the first day of any first Interest Period as it
relates to a Class of Notes the Bank Bill Rate shall be an interpolated rate
calculated with reference to the tenor of the relevant period.
AVAILABILITY FEE
For so long as the Redraw Facility exists, a fee (the "Availability Fee")
shall accrue daily from the date of the Redraw Facility on the Available Redraw
Amount, which Availability Fee is payable on each Payment Date and on
termination of the Redraw Facility. The Availability Fee is calculated on the
actual number of days elapsed and a year of 365 days.
REPAYMENT OF REDRAW ADVANCES
To the extent a Redraw Advance has been made and has not been repaid to the
Redraw Facility Provider, the amount of such unreimbursed Redraw Advance is
repayable on the following Payment Date and on termination of the Redraw
Facility, to the extent that there are funds available for such payment. It is
not an event of default if the Issuer Trustee does not have funds available to
repay the full amount of the unreimbursed Redraw Advance on the following
Payment Date.
EVENTS OF DEFAULT UNDER THE REDRAW FACILITY
It is an event of default under the Redraw Facility (whether or not such
event is within the control of the Issuer Trustee) if:
(1) an amount is available for payment to the Redraw Facility Provider
under the Redraw Facility, and the Issuer Trustee does not pay that amount
within 10 Business Days of its due date;
(2) an Insolvency Event occurs in relation to the Trust;
(3) an Insolvency Event occurs in relation to the Issuer Trustee, and a
successor trustee of the Trust is not appointed within 30 days of that
Insolvency Event;
(4) the Termination Date occurs in relation to the Trust; or
(5) an event of default (as defined in the Security Trust Deed) occurs
and any action is taken to enforce the security interest under the Security
Trust Deed over the assets of the Trust (including appointing a receiver or
receiver and manager or selling any of those assets).
With respect to the Issuer Trustee (in its personal capacity and as trustee
of a Trust), the Trust Manager, a Servicer, Westpac or a Mortgage Insurer (each
a "relevant corporation"), an "Insolvency Event" will occur upon the happening
of any of the following events:
(1) an administrator of the relevant corporation is appointed;
(2) except for the purpose of a solvent reconstruction or amalgamation:
(i) an application or an order is made, proceedings are commenced, a
resolution is passed or proposed in a notice of proceedings or an
application to a court or other steps (other than frivolous or vexatious
applications, proceedings, notices and steps) are taken for:
(a) the winding up, dissolution or administration of the relevant
corporation; or
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(b) the relevant corporation entering into an arrangement, compromise or
composition with or assignment for the benefit of its creditors or a class
of them; or
(ii) the relevant corporation ceases, suspends or threatens to cease or
suspend the conduct of all or substantially all of its business or disposes
of or threatens to dispose of substantially all of its assets; or
(3) the relevant corporation is, or under applicable legislation is taken to
be, unable to pay its debts (other than as the result of a failure to pay a debt
or claim the subject of a good faith dispute) or stops or suspends or threatens
to stop or suspend payment of all or a class of its debts (except, in the case
of the Issuer Trustee where this occurs in relation to another trust of which it
is the trustee);
(4) a receiver, receiver and manager or administrator is appointed (by the
relevant corporation or by any other person) to all or substantially all of the
assets and undertaking of the relevant corporation or any part thereof (except,
in the case of the Issuer Trustee where this occurs in relation to another trust
of which it is the trustee); or
(5) anything analogous to an event referred to in paragraphs (1) to (5)
(inclusive) or having substantially similar effect, occurs with respect to the
relevant corporation.
The "Termination Date" with respect to the Trust shall be the earlier to
occur of:
(1) the date which is 80 years after the date of creation of the Trust;
(2) the termination of the Trust under statute or general law;
(3) full and final enforcement of the Security Trust Deed; or
(4) at any time after all creditors of the Trust have been repaid in full
and the Issuer Trustee and the Trust Manager agree that no further Notes are
proposed to be issued by the Issuer Trustee in relation to the Trust, the
Business Day immediately following that date.
CONSEQUENCES OF OCCURRENCE OF EVENTS OF DEFAULT
At any time after an event of default (whether or not it is continuing) the
Redraw Facility Provider may do all or any of the following:
(1) by notice to the Issuer Trustee and the Trust Manager declare all moneys
actually or contingently owing under the Redraw Facility immediately due and
payable, and the Issuer Trustee must immediately pay the Principal Outstanding
together with accrued interest and fees and all such other moneys; and
(2) by notice to the Issuer Trustee and the Trust Manager cancel the Redraw
Limit with effect from any date specified in that notice.
TERMINATION OF THE REDRAW FACILITY
The Redraw Facility will terminate on the earliest of the following:
(1) the date on which the Issuer Trustee enters into a replacement Redraw
Facility;
(2) one month after the Class A Notes, the Class B Notes, the RFSs and the
Class A RFS Notes have been redeemed in full in accordance with the Master Trust
Deed and the Series Notice;
(3) following an event of default under the Redraw Facility, the date on
which the Redraw Facility Provider declares the Redraw Facility terminated;
(4) the date on which the Issuer Trustee has cancelled the Redraw Limit in
full. (The Issuer Trustee may cancel all or part of the Redraw Limit on not less
than five Business Days irrevocable notice to the Redraw Facility Provider);
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(5) the date which is one year after the Maturity Date;
(6) the date on which the Redraw Limit is cancelled in full by the Redraw
Facility Provider; or
(7) the date on which Westpac Securitisation Management Pty Limited retires
or is removed as Trust Manager under the Master Trust Deed.
The Redraw Limit may be also be reduced in part by the Redraw Facility
Provider by giving notice to the Issuer Trustee and the Trust Manager. Such a
reduction does not result in a termination of the Redraw Facility.
ISSUANCE OF REDRAW FUNDING SECURITIES ("RFS")
If on a Collection Determination Date:
(1) Gross Principal Collections for the Collection Period preceding that
Collection Determination Date and all amounts available to be drawn under the
Redraw Facility are insufficient to fund Redraws made during that Collection
Period; or
(2) the Principal Outstanding under the Redraw Facility divided by the
Redraw Limit, expressed as a percentage, is equal to or greater than 90% of the
Redraw Limit;
then the Trust Manager may give the Issuer Trustee a direction to issue a
series of RFSs (the "RFS Series").
CONDITION PRECEDENT TO THE ISSUE OF RFSS
Notwithstanding the requirements referred to above, before giving a
direction for the issue of an RFS Series the Trust Manager must confirm with the
Rating Agencies that the issue will not result in the downgrading or withdrawal
of the rating of any Offered Note.
RFS CLASS A NOTES
If, on the fifth Collection Determination Date following the date on which
an RFS Series was issued, the RFS Stated Amount for all RFSs in that RFS Series
has not been reduced to zero, each of those outstanding RFSs will convert to an
"RFS Class A Note." The converted RFS will:
(1) have an Initial Invested Amount equal to the RFS Initial Invested Amount
of that Note when it was an RFS;
(2) have an Invested Amount equal to the RFS Invested Amount of that Note
when it was an RFS at the date of conversion;
(3) have a Stated Amount equal to the RFS Stated Amount of that Note when it
was an RFS at the date of conversion;
(4) be denominated in Australian dollars;
(5) receive all payments of principal and interest denominated in Australian
dollars;
(6) have an Interest Rate calculated by reference to the Bank Bill Rate, not
"USD-LIBOR-BBA";
(7) be evidenced by a notation in a register maintained by the Issuer
Trustee; and
(8) have a Margin equal to the margin under the Class A Notes.
"Margin" means: (1) in the case of Class A Notes, % and in the case of
the Class B Notes, %; (2) in the case of any RFSs, the margin inscribed in
the register maintained by the Issuer Trustee in relation to those RFSs on their
issue date; and (3) in the case of any RFS Class A Note, the Margin for the
Class A Notes plus the spread under the Currency Swap.
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FORM OF THE RFSS AND THE RFS CLASS A NOTES
The RFSs and the RFS Class A Notes will be evidenced by a notation in a
register maintained by the Issuer Trustee and denominated in Australian dollars
which will be issued in Australia to Australian resident investors only. The
total issue amount of RFS Class A Notes (if any) will be determined by the
amount of RFSs (if any) issued during the term of the Offered Notes. The RFSs
and RFS Class A Notes are not offered hereby.
INTEREST PAYABLE ON THE RFSS AND THE RFS CLASS A NOTES
Commencing on the issue date of an RFS or the conversion date of an RFS
Class A Note, Interest is payable monthly in arrears on each RFS and RFS Class A
Note to the person whose name is registered under the Master Trust Deed and the
Series Notice as the holder of the RFS or RFS Class A Note, until the Maturity
Date or until the Stated Amount of the RFS or RFS Class A Note is reduced to
zero (whichever is earlier). "Interest", with respect to an RFS or an RFS Class
A Note, shall be equal to the interest accrued on the Invested Amount for such
RFS or RFS Class A Note at a rate equal to the Bank Bill Rate on the first day
of that Interest Period plus the margin for the RFS or RFS Class A Note, during
the period from the subsequent Payment Date to the day preceding the Payment
Date, calculated on the actual number of days in the related Interest Period
over 365. With respect to any RFS and Payment Date, the margin shall be a per
annum rate specified by the Trust Manager to the Issuer Trustee as applying to
that RFS on its issue date as inscribed in the register for that RFS. With
respect to any RFS Class A Note and a Payment Date, the related margin will be
the Margin applicable to Class A Notes for the same Interest Period (as defined
in the Currency Swap).
Payments to the holders of RFSs and the holders of RFS Class A Notes will be
in Australian dollars. Payments of Interest on the RFSs and the RFS Class A
Notes are PARI PASSU with respect to Interest payable on the Class A Notes and
rank ahead of Interest payable on the Class B Notes.
SUBORDINATION OF CLASS B NOTES; PRIORITY OF PAYMENT OF PRINCIPAL TO RFS
The Class A Noteholders, the holders of RFSs (if any), the holders of RFS
Class A Notes (if any) and the Redraw Facility Provider will have the benefit of
the subordination of the Class B Notes. That is, to the extent that there is a
loss on a Housing Loan which is not satisfied by a claim (or deemed claim) under
a Mortgage Insurance Policy, by amounts recoverable by the Issuer Trustee from
an Approved Seller or the Servicer, or by the application of Excess Available
Income, the amount of that loss will be allocated to the Class B Notes, reducing
the Stated Amount of the Class B Notes until their Stated Amount is zero. The
amount of any remaining loss will then be allocated PARI PASSU, between the
Class A Notes, the RFSs (if any), the RFS Class A Notes (if any) and the Redraw
Facility, reducing the Stated Amount of the Class A Notes, the RFSs (if any) and
the RFS Class A Notes (if any) until their Stated Amount is zero and reducing
the Principal Outstanding under the Redraw Facility until it is zero. For
further details see "-- Application of Principal Charge Offs" above. Payments of
principal on the RFSs will be made prior to payments of principal to the Offered
Noteholders and the holders of the RFS Class A Notes.
SUBSTITUTION OF HOUSING LOANS
The Trust Manager may substitute a housing loan from a WST warehouse trust
for a Housing Loan in the Trust. For a housing loan in a WST trust to be
eligible for substitution for a Housing Loan, the housing loan in the other WST
trust must have a maturity date not later than the date which is one year before
the Maturity Date of the Notes, have similar product features to one or more of
the Housing Loans, have an Unpaid Balance within A$30,000 of the Unpaid Balance
of the Housing Loan for which it is being substituted and must otherwise be
suitable for substitution in the Trust Manager's sole and absolute discretion.
The Trust Manager may take into account the geographic locations of the
properties securing the Housing Loan and the substituted housing loan. The Trust
Manager may not substitute a housing loan
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unless it has received written confirmation from the Rating Agencies that the
substitution will not result in the downgrade or withdrawal of the rating given
to the Offered Notes. In addition, if the Unpaid Balance of the Housing Loan
removed from the Trust is greater than the Unpaid Balance of the substituted
housing loan, the WST warehouse trust must pay the Issuer Trustee such
difference, and, on the following Payment Date, any relevant interest
adjustment.
PRESCRIPTION
An Offered Note shall become void in its entirety unless surrendered for
payment within ten years of the Relevant Date in respect of any payment thereon
the effect of which would be to reduce the Stated Amount of such Note to zero.
After the date on which a Note becomes void in its entirety, no claim may be
made in respect of it.
The "Relevant Date" means the date on which a payment first becomes due but,
if the full amount of the money payable has not been received in New York City
by the Principal Paying Agent or the Note Trustee on or prior to that date, it
means the date on which, the full amount of such money having been so received,
notice to that effect is duly given in accordance with the terms of the Notes.
CLEAN-UP OFFER
If at any time the aggregate Housing Loan Principal, expressed as a
percentage of the aggregate Housing Loan Principal as of the Cut-Off Date, is
less than 10%, then, if instructed by the Trust Manager, the Seller Trustee may
repurchase, on the following Payment Date, the equitable title to the Housing
Loans held by the Trust for an amount equal to the Unpaid Balance (in the case
of performing Housing Loans) or the Fair Market Value (in the case of
non-performing Housing Loans). The proceeds of sale will be applied by the
Issuer Trustee to repay moneys owing to Noteholders at that time in accordance
with the priorities for applying payments of Interest and principal between the
Classes of Notes.
REDEMPTION OF THE NOTES
If an event of default occurs under the Security Trust Deed while the Notes
are outstanding, the Security Trustee may (subject, in certain circumstances, to
the prior written consent of the Note Trustee in accordance with the provisions
of the Security Trust Deed), (and will if so directed by the Note Trustee alone
where it is the only Voting Mortgagee, or, otherwise by a resolution of 75% of
the Voting Mortgagees) enforce the security created by the Security Trust Deed.
That enforcement can include the sale of some or all of the Housing Loans. There
is no guarantee that the Security Trustee will be able to sell the Housing Loans
for their then Unpaid Balance. Accordingly, the Security Trustee may not be able
to realize the full value of the Housing Loans and this may have an impact upon
the Issuer Trustee's ability to repay all amounts outstanding in relation to the
Notes.
Any proceeds from the enforcement of the security will be applied in
accordance with the order of priority of payments as set out in the Security
Trust Deed. See "SECURITY FOR THE NOTES-- Priorities Under the Security Trust
Deed."
If the Trust terminates while Notes are outstanding, Westpac has a right of
first refusal to acquire the Housing Loans. The price to be paid by Westpac for
performing and non-performing Housing Loans must not be less than their Fair
Market Value. In the case of performing loans, the Issuer Trustee is required to
offer to sell them to Westpac under its right of first refusal for their then
Unpaid Balance. The "Unpaid Balance" of a Housing Loan, means the sum of (a) the
unpaid principal amount of that Housing Loan; and (b) the unpaid amount of all
finance charges, interest payments and other amounts accrued on or payable under
or in connection with that Housing Loan or the related Mortgage or other rights
relating to the Housing Loan. Where the Fair Market Value of a Housing Loan is
less than its then Unpaid Balance, its acquisition by Westpac will be subject to
prior approval by an Extraordinary Resolution of Noteholders. This is because in
such circumstances there may be a shortfall in the amount available to the
Issuer Trustee
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to fully repay all amounts outstanding in relation to the Notes. The Servicer
will determine whether a Housing Loan is performing or non-performing.
WITHHOLDING OR TAX DEDUCTIONS
All payments in respect of the Offered Notes will be made without
withholding or tax deduction for, or on account of, any present or future taxes,
duties or charges of whatsoever nature unless the Issuer Trustee or any Paying
Agent is required by applicable law to make any such payment in respect of the
Offered Notes subject to any withholding or deduction for, or on account of, any
present or future taxes, duties or charges of whatsoever nature. In the event
that the Issuer Trustee or that the Paying Agent (as the case may be) shall make
such payment after such withholding or deduction has been made, it shall account
to the relevant authorities for the amount so required to be withheld or
deducted. Neither the Issuer Trustee nor any Paying Agent will be obliged to
make any additional payments to holders of the Offered Notes in respect to that
withholding or deduction.
REDEMPTION OF THE OFFERED NOTES FOR TAXATION OR OTHER REASONS
If the Trust Manager satisfies the Issuer Trustee and the Note Trustee
immediately prior to giving the notice referred to below that either (i) on the
next Payment Date the Issuer Trustee would be required to deduct or withhold
from any payment of principal or interest in respect of the Offered Notes any
amount for or on account of any present or future taxes, duties, assessments or
governmental charges of whatever nature imposed, levied, collected, withheld or
assessed by the Commonwealth of Australia or any of its political sub-divisions
or any of its authorities or (ii) the total amount payable in respect of
interest in relation to the Housing Loans for a Collection Period ceases to be
receivable (whether or not actually received) by the Issuer Trustee during such
Collection Period, the Issuer Trustee must, when so directed by the Trust
Manager (at the Trust Manager's option) (provided that the Issuer Trustee will
be in a position on such Payment Date to discharge (and will so certify to the
Issuer Trustee and the Note Trustee) all its liabilities in respect of such
Class and any amounts required under the Security Trust Deed to be paid in
priority to or pari passu with such Class), at any time at its option, having
given not more than 60 nor less than 30 days' notice to the Noteholders of such
Class redeem all, but not some, of such Class at their Invested Amount (or at
the option of the Noteholders of such Class, to be exercised by way of
Extraordinary Resolution of the Noteholders of such Class, at their Stated
Amount), together with accrued interest to the date of redemption on any
subsequent Payment Date, provided that the Noteholders of such Class may by
Extraordinary Resolution elect, and shall notify the Issuer Trustee and the
Trust Manager, that they do not require the Issuer Trustee to redeem such Class
of Notes in the circumstances described above.
TERMINATION OF THE TRUST
TERMINATION EVENTS
The Trust will terminate on any date which is a Termination Date.
REALIZATION UPON TRUST ASSETS
On the termination of the Trust, subject to Westpac's right of first refusal
outlined below, the Issuer Trustee must sell and realize the assets of the Trust
within 180 days. During the 180 day period, the Housing Loans, if performing,
must not be sold for less than their Unpaid Balance and in the case of non-
performing Housing Loans, for less than their Fair Market Value. The Issuer
Trustee may not sell any performing Housing Loan, within the 180 day period, for
less than its Fair Market Value without the consent of an Extraordinary
Resolution of the relevant Noteholders. The Servicer will determine whether a
Housing Loan is performing or non-performing.
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APPROVED SELLER'S RIGHT OF FIRST REFUSAL
As soon as practical after the Termination Date of the Trust, the Trust
Manager will direct the Issuer Trustee to offer (by written notice to Westpac)
irrevocably to extinguish in favor of Westpac, or if the Issuer Trustee has
perfected its title, to equitably assign to Westpac, its entire right, title and
interest in and to the Housing Loans, and related Mortgages (if any) for their
Unpaid Balance (for performing Housing Loans) and their Fair Market Value (for
non-performing Housing Loans). If the Fair Market Value of a Housing Loan is
less than its Unpaid Balance, the sale requires the approval of an Extraordinary
Resolution of Noteholders.
The Issuer Trustee is not entitled to sell any Housing Loans unless Westpac
has failed to accept the offer within 180 days after the occurrence of the
Termination Date by paying to the Issuer Trustee, within 180 days, the purchase
price.
DISTRIBUTION
After deducting expenses, the Trust Manager shall direct the Issuer Trustee
to distribute the proceeds of realization of the assets of the Trust in
accordance with the cashflow allocation methodology set out above, and in
accordance with any directions given to it by the Trust Manager.
If all Notes relating to the Trust have been fully redeemed and the Trust's
creditors paid in full, the Issuer Trustee may distribute all or part of the
Trust Assets to the relevant Beneficiary.
TRUST ACCOUNTS
The Issuer Trustee will establish and maintain under the Master Trust Deed
bank accounts with an Approved Bank, consisting of the "Collection Account" and
the US$ Account (collectively, the "Trust Accounts"). Each bank account shall be
opened by the Issuer Trustee in its name and in its capacity as trustee of the
Trust. No bank account shall be used for any purpose other than for the Trust
and in accordance with the Master Trust Deed.
The Trust Manager shall have the discretion and the duty to recommend or to
propose in writing to the Issuer Trustee, the manner in which any moneys forming
part of the Trust shall be invested in Authorized Investments and what
purchases, sales, transfers, exchanges, collections, realizations or alterations
of Trust Assets shall be effected and when and how the same should be effected.
It is the role of the Issuer Trustee to give effect to all such recommendations
or proposals of the Trust Manager. Each investment of moneys on deposit in the
Trust Accounts shall be in Authorized Investments that will mature not later
than the Business Day preceding the applicable monthly Payment Date. "Authorized
Investments" consist of the following: (a) Housing Loans, Mortgages and other
related securities, (b) cash, (c) bonds, debentures, stock or treasury bills of
the Commonwealth of Australia or the Government of any State or Territory of the
Commonwealth; (d) debentures or stock of any public statutory body constituted
under the law of the Commonwealth of Australia or of any State of the
Commonwealth where the repayment of the principal is secured and the interest
payable thereon is guaranteed by the Commonwealth or any State or Territory of
the Commonwealth; (e) notes of other securities of the Commonwealth of Australia
or the Government of any State or Territory of the Commonwealth; (f) (i)
deposits with, or the acquisition of certificates of deposit (whether
negotiable, convertible or otherwise), issued by, a bank which carries on
business in Victoria and New South Wales; (ii) bills of exchange which at the
time of acquisition have a remaining term to maturity of not more than 200 days,
accepted or endorsed by a bank which carries on business in Victoria and New
South Wales, which, in each case, has either: (A) the highest short-term rating
available to be given by the Rating Agencies; or (B) if such investment has a
maturity of 30 days or less and does not exceed 20% of the total Invested Amount
of all relevant Notes on the date of the investment, a short-term rating of
A-1/P-1/F-1 by the Rating Agencies; and (g) any other assets of a class of
assets that are both: (i) prescribed for the purposes of sub-paragraph (iv) of
the definition of a "pool of mortgages" in section 84FA(1) of the Stamp Duties
Act, 1920 of New South Wales, or are otherwise
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included within that definition of "pool of mortgages"; and (ii) declared by
order of the Governor in Council of Victoria and published in the Victorian
Government Gazette to be assets for purposes of Subdivision 17A of the Stamps
Act, 1958 of Victoria or are otherwise included within sub-paragraph (b)(ii) of
the definition of "pool of mortgages" in section 137NA of that Act.
GENERAL
Collections and other amounts credited to the Collection Account will be
allocated by the Trust Manager, and paid by the Issuer Trustee as directed by
the Trust Manager, as set forth herein.
DETERMINATION DATE--CALCULATIONS AND REPORTS TO NOTEHOLDERS
On each Determination Date, the Trust Manager will, in respect of the
Collection Period ending before that Determination Date, calculate or otherwise
ascertain:
(i) the Available Income;
(ii) the Total Available Funds;
(iii) in the case of the first Determination Date, the Accrued Interest
Adjustment payable to each Approved Seller;
(iv) the aggregate of all Redraws made during that Collection Period;
(v) the Redraw Shortfall;
(vi) the Trust Expenses;
(vii) the Subordinated Percentage;
(viii) the Initial Subordinated Percentage;
(ix) the Total Payments;
(x) the Payment Shortfall (if any);
(xi) the Principal Draw (if any) for that Collection Period, together
with all Principal Draws made before the start of that Collection Period and
not repaid;
(xii) the Gross Principal Collections;
(xiii) the Principal Collections;
(xiv) the Excess Available Income (if any);
(xv) the Excess Collections Distribution (if any);
(xvi) the Liquidity Shortfall (if any);
(xvii) the Remaining Liquidity Shortfall (if any);
(xviii) the aggregate of all Liquidation Losses (if any);
(xix) the Principal Charge Off (if any);
(xx) the Class A Percentage and the Class B Percentage;
(xxi) the Class A Bond Factor, the Class B Bond Factor, the RFS Class A
Bond Factor and the RFS Bond Factor for each RFS Series;
(xxii) the Class A Charge Offs, the Class B Charge Offs, the RFS Class A
Charge Offs, the RFS Charge Offs and the Redraw Charge Offs (if any);
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(xxiii) all Carryover Charge Offs (if any);
(xxiv) the Purchase Price adjustment;
(xxv) if required, the Threshold Rate at that Collection Determination
Date;
(xxvi) total Prepayment Costs (if any);
(xxvii) total Prepayment Benefits (if any);
(xxviii) the Prepayment Cost Surplus (if any);
(xxix) the Prepayment Benefit Shortfall (if any);
(xxx) the Substitution Net Transfer Amount (Income) an the Substitution
Net Transfer Amount (Principal) (if any);
(xxxi) the Quarterly Percentage;
(xxxii) each US$ Equivalent amount, and each A$ Equivalent amount, required
to be calculated under the Series Notice;
(xxxiii) LIBOR, as at the first day of the related Interest Period ending
immediately after that Collection Determination Date as calculated by the
Agent Bank; and
(xxxiv) all other calculations necessary for the Issuer Trustee to make
allocations and distributions to Noteholders.
The Notes will be registered in the name of a nominee of DTC and will not be
registered in the names of the beneficial owners or their nominees. As a result,
unless and until Definitive Notes are issued in the limited circumstances
described under "--Definitive Notes" below, beneficial owners will not be
recognized by the Issuer Trustee as Noteholders, as that term is used in the
Master Trust Deed. Hence, until such time, beneficial owners will receive
reports and other information provided for under the Transaction Documents only
if, when and to the extent provided by DTC and its participating organizations.
BOOK-ENTRY REGISTRATION
Each Class of Notes will be represented by one or more book-entry Notes (the
"Book-Entry Notes"). Persons acquiring beneficial ownership interests in the
Notes ("Note Owners") will hold their Notes through the Depository Trust Company
("DTC") in the United States, or Cedel or Euroclear (in Europe) if they are
participants of such systems, or indirectly through organizations which are
participants in such systems. The Book-Entry Notes will be issued in one or more
certificates which equal the aggregate principal balance of each Class of Notes
and will initially be registered in the name of Cede & Co., the nominee of DTC.
Cedel and Euroclear will hold omnibus positions on behalf of their participants
through customers' securities accounts in Cedel's and Euroclear's names on the
books of their respective depositaries which in turn will hold such positions in
customers' securities accounts in the depositaries' names on the books of DTC.
Citibank will act as depositary for Cedel, and Chase will act as depositary for
Euroclear (in such capacities, individually, the "Relevant Depositary" and
collectively, the "European Depositaries"). Investors may hold such beneficial
interests in the Book-Entry Notes in minimum denominations of US$100,000. Except
as described below, no person acquiring a Book-Entry Note (each, a "beneficial
owner") will be entitled to receive a physical certificate representing such
Note (a "Definitive Note"). Unless and until Definitive Notes are issued, it is
anticipated that the only "Noteholder" of each Class of Notes will be Cede &
Co., as nominee of DTC. Note Owners will not be Noteholders as that term is used
in the Master Trust Deed. Note Owners are only permitted to exercise their
rights indirectly through Participants and DTC.
The beneficial owner's ownership of a Book-Entry Note will be recorded on
the records of the brokerage firm, bank, thrift institution or other financial
intermediary (each, a "Financial Intermediary")
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that maintains the beneficial owner's account for such purpose. In turn, the
Financial Intermediary's ownership of such Book-Entry Note will be recorded on
the records of DTC (or of a participating firm that acts as agent for the
Financial Intermediary, whose interest will in turn be recorded on the records
of DTC, if the beneficial owner's Financial Intermediary is not a DTC
participant and on the records of Cedel or Euroclear, as appropriate).
Note Owners will receive all distributions of principal of, and interest on,
each Class of Notes from the Trustee through DTC and DTC participants. While the
Notes are outstanding (except under the circumstances described below), under
the rules, regulations and procedures creating and affecting DTC and its
operations (the "Rules"), DTC is required to make book-entry transfers among
Participants on whose behalf it acts with respect to the Notes and is required
to receive and transmit distributions of principal of, and interest on, the
Notes. Participants and indirect participants with whom Note Owners have
accounts with respect to Notes are similarly required to make book-entry
transfers and receive and transmit such distributions on behalf of their
respective Note Owners. Accordingly, although Note Owners will not possess
certificates, the Rules provide a mechanism by which Note Owners will receive
distributions and will be able to transfer their interest.
Note Owners will not receive or be entitled to receive certificates
representing their respective interests in the Offered Notes, except under the
limited circumstances described below. Unless and until Definitive Notes are
issued, Note Owners who are not Participants may transfer ownership of Notes
only through Participants and indirect participants by instructing such
Participants and indirect participants to transfer Notes, by book-entry
transfer, through DTC for the account of the purchasers of such Offered Notes,
which account is maintained with their respective Participants. Under the Rules
and in accordance with DTC's normal procedures, transfers of ownership of Notes
will be executed through DTC and the accounts of the respective Participants at
DTC will be debited and credited. Similarly, the Participants and indirect
participants will make debits or credits, as the case may be, on their records
on behalf of the selling and purchasing Note Owners.
Because of time zone differences, credits of securities received in Cedel or
Euroclear as a result of a transaction with a Participant will be made during
subsequent securities settlement processing and dated the Business Day following
the DTC settlement date. Such credits or any transactions in such securities
settled during such processing will be reported to the relevant Euroclear or
Cedel Participants on such Business Day. Cash received in Cedel or Euroclear as
a result of sales of securities by or through a Cedel Participant (as defined
below) or Euroclear Participant (as defined below) to a DTC Participant will be
received with value on the DTC settlement date but will be available in the
relevant Cedel or Euroclear cash account only as of the Business Day following
settlement in DTC. For information with respect to tax documentation procedures
relating to the Notes, [see "UNITED STATES FEDERAL INCOME TAX
CONSEQUENCES--Federal Income Tax Consequences to Foreign Investors" and
"--Backup Withholding" herein and "GLOBAL CLEARANCE, SETTLEMENT AND TAX
DOCUMENTATION PROCEDURES--Certain U.S. Federal Income Tax Documentation
Requirements" in Annex I hereto.]
Transfers between Participants will occur in accordance with DTC rules.
Transfers between Cedel Participants and Euroclear Participants will occur in
accordance with their respective rules and operating procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Cedel
Participants or Euroclear Participants, on the other, will be effected in DTC in
accordance with DTC rules on behalf of the relevant European international
clearing system by the Relevant Depositary; however, such cross market
transactions will require delivery of instructions to the relevant European
international clearing system by the counterparty in such system in accordance
with its rules and procedures and within its established deadlines (European
time). The relevant European international clearing system will, if the
transaction meets its settlement requirements, deliver instructions to the
Relevant Depositary to take action to effect final settlement on its behalf by
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delivering or receiving securities in DTC, and making or receiving payment in
accordance with normal procedures for same day funds settlement applicable to
DTC. Cedel Participants and Euroclear Participants may not deliver instructions
directly to the European Depositaries.
DTC, which is a New York-chartered limited purpose trust company, performs
services for its participants, some of which (and/or their representatives) own
DTC. In accordance with its normal procedures, DTC is expected to record the
positions held by each DTC participant in the Book-Entry Notes, whether held for
its own account or as a nominee for another person. In general, beneficial
ownership of Book-Entry Notes will be subject to the rules, regulations and
procedures governing DTC and DTC participants as in effect from time to time.
Cedel is incorporated under the laws of Luxembourg as a professional
depository. Cedel holds securities for its participating organizations ("Cedel
Participants") and facilitates the clearance and settlement of securities
transactions between Cedel Participants through electronic book-entry changes in
accounts of Cedel Participants, thereby eliminating the need for physical
movement of certificates. Transactions may be settled in Cedel in any of 28
currencies, including United States dollars. Cedel provides to its Cedel
Participants, among other things, services for safekeeping, administration,
clearance and settlement of internationally-traded securities and securities
lending and borrowing. Cedel interfaces with domestic markets in several
countries. As a professional depository, Cedel is subject to regulation by the
Luxembourg Monetary Institute. Cedel participants are recognized financial
institutions around the world, including underwriters, securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. Indirect access to Cedel is also available to others, such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Cedel Participant, either directly or indirectly.
Euroclear was created in 1968 to hold securities for its participants
("Euroclear Participants") and to clear and settle transactions between
Euroclear Participants through simultaneous electronic book-entry delivery
against payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of securities and
cash. Transactions may be settled in any of 32 currencies, including United
States dollars. Euroclear includes various other services, including securities
lending and borrowing and interfaces with domestic markets in several countries
generally similar to the arrangements for cross-market transfers with DTC
described above. Euroclear is operated by the Brussels, Belgium office of Morgan
Guaranty Trust Company of New York (the "Euroclear Operator"), under contract
with Euroclear Clearance Systems S.C., a Belgian cooperative corporation (the
"Cooperative"). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator, not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries. Indirect access to Euroclear is
also available to other firms that clear through or maintain a custodial
relationship with a Euroclear Participant, either directly or indirectly.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The
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Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.
Distributions on the Book-Entry Notes will be made on each Payment Date by
the Note Trustee to DTC. DTC will be responsible for crediting the amount of
such payments to the accounts of the applicable DTC participants in accordance
with DTC's normal procedures. Each DTC participant will be responsible for
disbursing such payments to the beneficial owners of the Book-Entry Notes that
it represents and to each Financial Intermediary for which it acts as agent.
Each such Financial Intermediary will be responsible for disbursing funds to the
beneficial owners of the Book-Entry Notes that it represents.
Under a book-entry format, beneficial owners of the Book-Entry Notes may
experience some delay in their receipt of payments, since such payments will be
forwarded by the Trustee to Cede & Co. Distributions with respect to Notes held
through Cedel or Euroclear will be credited to the cash accounts of Cedel
Participants or Euroclear Participants in accordance with the relevant system's
rules and procedures, to the extent received by the Relevant Depositary. Such
distributions will be subject to tax reporting in accordance with relevant
United States tax laws and regulations. [See "UNITED STATES FEDERAL INCOME TAX
CONSEQUENCES--Federal Income Tax Consequences to Foreign Investors" and
"--Backup Withholding" herein.] Because DTC can only act on behalf of Financial
Intermediaries, the ability of a beneficial owner to pledge Book-Entry Notes to
persons or entities that do not participate in the Depository system, or
otherwise take actions in respect of such Book-Entry Notes, may be limited due
to the lack of physical certificates for such Book-Entry Notes. In addition,
issuance of the Book-Entry Notes in book-entry form may reduce the liquidity of
such Notes in the secondary market since certain potential investors may be
unwilling to purchase Notes for which they cannot obtain physical certificates.
Monthly and annual reports on the Trust will be provided to Cede & Co., as
nominee of DTC, and may be made available by Cede & Co. to beneficial owners
upon request, in accordance with the rules, regulations and procedures creating
and affecting the Depository, and to the Financial Intermediaries to whose DTC
accounts the Book-Entry Notes of such beneficial owners are credited.
DTC has advised the Note Trustee that, unless and until Definitive Notes are
issued, DTC will take any action permitted to be taken by the holders of the
Book-Entry Notes under the Master Trust Deed only at the direction of one or
more Financial Intermediaries to whose DTC accounts the Book-Entry Notes are
credited, to the extent that such actions are taken on behalf of Financial
Intermediaries whose holdings include such Book-Entry Notes. Cedel or the
Euroclear Operator, as the case may be, will take any other action permitted to
be taken by a Noteholder under the Transaction Documents on behalf of a Cedel
Participant or Euroclear Participant only in accordance with its relevant rules
and procedures and subject to the ability of the Relevant Depositary to effect
such actions on its behalf through DTC. DTC may take actions, at the direction
of the related Participants, with respect to some Notes which conflict with
actions taken with respect to other Notes.
Although DTC, Cedel and Euroclear have agreed to the foregoing procedures in
order to facilitate transfers of Notes among participants of DTC, Cedel and
Euroclear, they are under no obligation to perform or continue to perform such
procedures and such procedures may be discontinued at any time.
Neither the Issuer Trustee, the Servicer nor the Trustee will have any
responsibility for any aspect of the records relating to or payments made on
account of beneficial ownership interests of the Book-Entry Notes held by Cede &
Co., as nominee for DTC, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
DEFINITIVE NOTES
The Notes of each Class will be issued in registered, certificated form to
the Note Owners of such Class or their nominees ("Definitive Notes"), rather
than to the Depository or its nominee, only if (i) the
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Depository advises the Note Trustee in writing that it is no longer willing or
able to discharge properly its responsibilities as Depository with respect to
the Notes of such Class, and the Note Trustee is unable to locate a qualified
successor, or (ii) an Event of Default has occurred, and Note Owners
representing not less than 75% of the Invested Amount of such Class advise the
Note Trustee and the Depository through Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interest of the Note Owners of such Class.
Upon the occurrence of any of the events described in the immediately
preceding paragraph, the Depository is required to notify all Participants of
the availability through the Depository of Definitive Notes [and the Note
Trustee will be required to notify all beneficial owners of the occurrence of
such event.] Upon surrender by the Depository of the definitive certificate
representing the Notes of the affected Class and instructions for registration,
the Trustee will issue the Notes of such Class as Definitive Notes, and
thereafter the Trustee will recognize the Note Owners of such Definitive Notes
as Noteholders under the Master Trust Deed, Series Notice and Note Trust Deed.
Distributions of principal and interest on the Notes will be made by the
Trustee directly to Noteholders in accordance with the procedures set forth
herein and in the Master Trust Deed, Series Notice and the Note Trust Deed.
Interest payments and any principal payments on each Payment Date will be made
to Noteholders in whose names the Definitive Notes were registered at the close
of business on the related Record Date. Distributions will be made by check
mailed to the address of such Noteholder as it appears on the register
maintained by the Trustee. The final payment, on any Note, however, will be made
only upon presentation and surrender of such Note at the office or agency
specified in the notice of final distribution to Noteholders. The Trustee will
provide such notice to registered Noteholders mailed not later than the fifth
day of the month of such final distributions.
Definitive Notes will be transferable and exchangeable at the offices of the
transfer agent and registrar, which initially will be the Trustee (in such
capacity, the "Transfer Agent and Registrar"). No service charge will be imposed
for any registration of transfer or exchange, but the Transfer Agent and
Registrar may require payment of a sum sufficient to cover any tax or other
governmental charge imposed in connection therewith. The Transfer Agent and
Registrar will not be required to register the transfer or exchange of
Definitive Notes for the period from the Record Date preceding the due date for
any payment to the Payment Date with respect to such Definitive Notes.
MODIFICATION OF MASTER TRUST DEED WITHOUT NOTEHOLDER CONSENT
The Issuer Trustee, the Trust Manager and the Servicer may by way of
supplemental deed alter, add to or modify the Master Trust Deed or a Series
Notice so long as such alteration, addition or modification was effected upon
consent of the Noteholders or Beneficiaries (see "--Modification of Master Trust
Deed with Noteholder Consent" below) or is:
(a) to correct a manifest error or ambiguity or is of a formal,
technical or administrative nature only;
(b) necessary to comply with the provisions of any statute or regulation
or with the requirements of any Australian governmental agency;
(c) appropriate or expedient as a consequence of an amendment to any
statute or regulation or altered requirements of any Government Agency
(including, without limitation, an alteration, addition or modification
which is appropriate or expedient as a consequence of the enactment of a
statute or regulation or an amendment to any statute or regulation or ruling
by the Australian Commissioner or Deputy Commissioner of Taxation or any
governmental announcement or statement, in any case which has or may have
the effect of altering the manner or basis of taxation of trusts generally
or of trusts similar to any of the Trusts); or
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(d) in the opinion of the Issuer Trustee desirable to enable the
provisions of the Master Trust Deed to be more conveniently, advantageously,
profitably or economically administered or is otherwise desirable for any
reason (including to give effect, in the Trust Manager's reasonable opinion,
to an allocation of expenses).
MODIFICATION OF MASTER TRUST DEED WITH NOTEHOLDER CONSENT
Where in the reasonable opinion of the Issuer Trustee a proposed alteration,
addition or modification to the Master Trust Deed (except an alteration,
addition or modification referred to in "--Modification of Master Trust Deed
Without Noteholder Consent" above) is prejudicial or likely to be prejudicial to
the interests of the Noteholders or a Class of Noteholders or the Beneficiaries
such alteration, addition or modification may only be effected by the Issuer
Trustee with the prior consent of the Noteholders or a Class of Noteholders (as
the case may be) under an Extraordinary Resolution of the Noteholders or a Class
of Noteholders (as the case may be) in the Trust or with the prior written
consent of the Beneficiaries (as the case may be).
[MEETINGS OF VOTING MORTGAGEES AND MEETINGS OF CLASS A NOTEHOLDERS;
MODIFICATION; CONSENTS; WAIVER
The Security Trust Deed contains provisions for convening meetings of the
Voting Mortgagees to, inter alia, enable the Voting Mortgagees to direct or
consent to the Security Trustee taking or not taking certain actions under the
Security Trust Deed, for example to enable the Voting Mortgagees to direct the
Security Trustee to enforce the Security Trust Deed.
For so long as the amounts outstanding under the Offered Notes are 75% or
more of all amounts secured by the Security Trust Deed, the Note Trustee may
direct the Security Trustee to do any act or thing which the Security Trustee is
required to do, or may only do, at the direction of an Extraordinary Resolution
of the Voting Mortgagees.
Neither the Security Trustee nor the Trust Manager may call a meeting of
Voting Mortgagees without the Note Trustee's consent, if the amounts outstanding
under the Notes are 75% or more of all amounts secured by the Security Trust
Deed.
The Note Trust Deed contains provisions for convening meetings of Class A
Noteholders to consider any matter affecting their interests, including the
directing, of the Note Trustee to direct the Security Trustee to enforce the
security under the Security Trust Deed, or the sanctioning by Extraordinary
Resolution of the Class A Noteholders of a modification of the Class A Notes or
the provisions of any of the Relevant Documents, provided that no modification
of certain terms including, inter alia, the date of maturity of the Class A
Notes, or a modification which would have the effect of postponing any day for
payment of interest in respect of any Class A Notes, reducing or cancelling the
amount of principal payable in respect of any Class A Notes or the rate of
interest applicable to any Class A Notes or altering the majority required to
pass an Extraordinary Resolution or altering the currency of payment of any
Class A Notes or an alteration of the date or priority of redemption of the
Class A Notes (any such modification being referred to below as a "Basic Terms
Modification") shall be effective except that, if the Note Trustee is of the
opinion that such a Basic Terms Modification is being proposed by the Issuer
Trustee as a result of, or in order to avoid, an Event of Default, such Basic
Terms Modification may be sanctioned by Extraordinary Resolution of the Class A
Noteholders as described below. The quorum at any meeting of Class A Noteholders
for passing an Extraordinary Resolution shall be two or more persons holding or
representing over 50% of the aggregate of the Class A Notes then outstanding or,
at any adjourned meeting, two or more persons being or representing Class A
Noteholders whatever the aggregate Invested Amount of the Class A Notes so held
or represented except that, at any meeting the business of which includes the
sanctioning of a Basic Terms Modification, the necessary quorum for passing an
Extraordinary Resolution shall be two or more persons holding or representing
75% or at any adjourned such meeting
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25%, or more of the aggregate Invested Amount of the Class A Notes (irrespective
of class) then outstanding. The Note Trust Deed contains provisions limiting the
powers of the Class B Noteholders, inter alia, to request or direct the Note
Trustee to take any action or to pass an effective Extraordinary Resolution
according to the effect thereof on the interests of the Class B Noteholders.
Except in certain circumstances, the Note Trust Deed imposes no such limitations
on the powers of the Class B Noteholders, the exercise of which will be binding
on the Class B Noteholders, irrespective of the effect on their interests. An
Extraordinary Resolution passed at any meeting of Class A Noteholders shall be
binding on all Class A Noteholders, whether or not they are present at the
meeting. The majority required for an Extraordinary Resolution shall be 75% of
the votes cast in respect of that Extraordinary Resolution.
Pursuant to the terms of the Note Trust Deed, the Note Trustee may agree,
without the consent of the Class A Noteholders, among other things, (i) to any
modification (except a Basic Terms Modification) of, or to the waiver or
authorization of any breach or proposed breach of the Class A Notes (including
the Conditions), or any of the Transaction Documents which is not, in the
opinion of the Note Trustee materially prejudicial to the interests of the Class
A Noteholders or (ii) to any modification of the Class A Notes (including the
Conditions, or any of the Transaction Documents which, in the Note Trustee's
opinion, is to correct a manifest error or is of a formal, minor or technical
nature. The Note Trustee may also, without the consent of the Class A
Noteholders, determine that any Event of Default or any condition, event or act
which with the giving of notice and/or lapse of time and/or the issue of a
certificate would constitute an Event of Default shall not, or shall not subject
to specified conditions, be treated as such. Any such modification, waiver,
authorization or determination shall be binding on the Class A Noteholders and,
unless the Note Trustee agrees otherwise, any such modification shall be
notified to the Class A Noteholders as specified in the Transaction Documents as
soon as practicable thereafter.
MEETINGS OF VOTING MORTGAGEES AND MEETINGS OF CLASS B NOTEHOLDERS;
MODIFICATIONS; CONSENTS; WAIVER
The Security Trust Deed contains provisions for convening meetings of the
Voting Mortgagees to, inter alia, enable the Voting Mortgagees to direct or
consent to the Security Trustee taking or not taking certain actions under the
Security Trust Deed, for example to enable the Voting Mortgagees to direct the
Security Trustee to enforce the Security Trust Deed.
For so long as the amounts outstanding under the Notes are 75% or more of
all amounts secured by the Security Trust Deed, the Note Trustee may direct the
Security Trustee to do any act or thing which the Security Trustee is required
to do, or may only do, at the direction of an Extraordinary Resolution of the
Voting Mortgagees.
Neither the Security Trustee nor the Trust Manager may call a meeting of
Voting Mortgagees without the Note Trustee's consent, if the amounts outstanding
under the Notes are 75% or more of all amounts secured by the Security Trust
Deed.
The Note Trust Deed contains provisions for convening meetings of Class B
Noteholders to consider any matter affecting their interests, including the
directing of the Note Trustee, to direct the Security Trustee to enforce the
security under the Security Trust Deed, or the sanctioning by Extraordinary
Resolution of the Class B Noteholders of a modification of the Class B Notes
(including the Conditions with respect to the Class B Notes) or the provisions
of any of the Transaction Documents, provided that no modification of certain
terms including, inter alia, the date of maturity of the Class B Notes, or a
modification which would have the effect of postponing any day for payment of
interest in respect of any Class B Notes, reducing or cancelling the amount of
principal payable in respect of any Class B Notes or the rate of interest
applicable to any Class B Notes or altering the majority required to pass an
Extraordinary Resolution or altering the currency of payment of any Class B
Notes or an alteration of the date or priority of redemption of the Class B
Notes (any such modification being referred to below as a "Basic Terms
Modification") shall be effective except that, if the Note Trustee is of the
opinion that such a
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Basic Terms Modification is being proposed by the Issuer Trustee as a result of,
or in order to avoid, an Event of Default, such Basic Terms Modification may be
sanctioned by Extraordinary Resolution of the Class B Noteholders as described
below. The quorum at any meeting of Class B Noteholders for passing an
Extraordinary Resolution shall be two or more persons holding or representing
over 50% of the aggregate of the Class B Notes then outstanding or, at any
adjourned meeting, two or more persons being or representing Class B Noteholders
whatever the aggregate Invested Amount of the Class A Notes so held or
represented except that, at any meeting the business of which includes the
sanctioning of a Basic Terms Modification, the necessary quorum for passing an
Extraordinary Resolution shall be two or more persons holding or representing
75% or at any adjourned such meeting 25%, or more of the aggregate Invested
Amount of the Class B Notes (irrespective of class) then outstanding. The Note
Trust Deed contains provisions limiting the powers of the Class B Noteholders,
inter alia, to request or direct the Note Trustee to take any action or to pass
an effective Extraordinary Resolution according to the effect thereof on the
interests of the Class B Noteholders. Except in certain circumstances, the Note
Trust Deed imposes no such limitations on the powers of the Class B Noteholders,
the exercise of which will be binding on the Class B Noteholders, irrespective
of the effect on their interests. An Extraordinary Resolution passed at any
meeting of Class B Noteholders shall be binding on all Class B Noteholders,
whether or not they are present at the meeting. The majority required for an
Extraordinary Resolution shall be 75% of the votes cast in respect of that
Extraordinary Resolution.
Pursuant to the terms of the Note Trust Deed, the Note Trustee may agree,
without the consent of the Class B Noteholders; among other things (i) to any
modification (except a Basic Terms Modification) of; or to the waiver or
authorization of any breach or proposed breach of the Class B Notes (including
the Conditions with respect to the Class B Notes), or any of the Transaction
Documents which is not, in the opinion of the Note Trustee materially
prejudicial to the interests of the Class B Noteholders or (ii) to any
modification of the Class B Notes (including the Conditions with respect to the
Class B Notes, or any of the Transaction Documents which, in the Note Trustee's
opinion, is to correct a manifest error or is of a formal, minor or technical
nature. The Note Trustee may also, without the consent of the Class B
Noteholders, determine that any Event of Default or any condition, event or act
which with the giving of notice and/or lapse of time and/or the issue of a
certificate would constitute an Event of Default shall not, or shall not subject
to specified conditions, be treated as such. Any such modification, waiver,
authorization or determination shall be binding on the Class B Noteholders and,
unless the Note Trustee agrees otherwise, any such modification shall be
notified to the Class B Noteholders as specified in the Transaction Documents as
soon as practicable thereafter.]
EVENTS OF DEFAULT; RIGHTS UPON EVENT OF DEFAULT
An "Event of Default" under the Security Trust Deed will occur if:
(1) the Issuer Trustee fails to pay any Interest within 10 Business Days
of the Payment Date on which the Interest was due to be paid to Class A
Noteholders, Class B Noteholders, holders of RFSs or holders of RFS Class A
Notes;
(2) the Issuer Trustee fails to pay any other amount owing to Class A
Noteholders, Class B Noteholders, holders of RFSs, holders of RFS Class A
Notes or any other Mortgagee (as defined in the Security Trust Deed) within
10 Business Days of the due date for payment (or within any applicable grace
period agreed with the relevant Mortgagee or where the Mortgagee is a
Noteholder with the Note Trustee);
(3) the Issuer Trustee fails to perform or observe any other provisions
(other than the obligations referred to in paragraphs (1) and (2)) of a
Transaction Document where such failure will have a material and adverse
effect on the amount of any payment to be made to any Noteholder or will
materially and adversely affect the timing of such payment, and that default
(if in the opinion of the Security Trustee capable of remedy (that opinion,
being subject in certain circumstances to the
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approval of the Note Trustee in accordance with the provisions of the
Security Trust Deed)) is not remedied within 30 days (or such longer period
as may be specified in the notice, that longer period having been approved
by the Note Trustee, for so long as amounts outstanding under the Notes are
75% or more of the Secured Moneys after written notice from the Security
Trustee requiring the failure to be remedied;
(4) an Insolvency Event occurs relating to the Issuer Trustee (in its
personal capacity or as trustee of the Trust);
(5) the charge created by the Security Trust Deed is not or ceases to be
a first ranking charge over the Trust Assets, or any other obligation of the
Issuer Trustee (other than as mandatorily preferred by law) ranks ahead of
or PARI PASSU with any of the moneys secured by the Security Trust Deed;
(6) any security interest over the Trust Assets is enforced;
(7) all or any part of any Transaction Document (other than the Redraw
Facility or the Swap Agreements) is terminated or is or becomes void,
illegal, invalid, unenforceable or of limited force and effect, or a party
becomes entitled to terminate, rescind or avoid all or part of any
Transaction Document (other than the Underwriting Agreement, the Redraw
Facility or the Swap Agreements); or
(8) without the prior consent of the Security Trustee (that consent
being subject in certain circumstances to the prior written consent of the
Note Trustee in accordance with the provisions of the Security Trust Deed),
(i) the Trust is wound up, or the Issuer Trustee is required to wind up the
Trust under the Master Trust Deed or applicable law, or the winding up of
the Trust commences; (ii) the Trust is held or is conceded by the Issuer
Trustee not to have been constituted or to have been imperfectly
constituted; or (iii) unless another trustee is appointed to the Trust under
the Transaction Documents, the Issuer Trustee ceases to be authorized under
the Trust to hold the property of the Trust in its name and to perform its
obligations under the Transaction Documents.
ENFORCEMENT
[The Security Trustee must promptly convene a meeting of the Voting
Mortgagees after it receives notice, or has actual knowledge of, an Event of
Default.] The Security Trustee may waive (such waiver, being subject to the
prior written consent of the Note Trustee in accordance with the provisions of
the Security Trust Deed), an Event of Default before it is required to convene a
meeting of Mortgagees if that Event of Default is not (in the opinion of the
Security Trustee) materially prejudicial to the Mortgagees' interests.
[At the meeting, the Voting Mortgagees must vote by Extraordinary Resolution
(being a resolution passed at a duly convened meeting by a majority consisting
of not less than 75% of the votes capable of being cast by Voting Mortgagees
present in person or by proxy or by written resolution signed by all of the
Voting Mortgagees)] on whether to direct the Security Trustee to:
(1) declare the charge to be enforceable;
(2) declare all Secured Moneys (including amounts outstanding under the
Notes plus accrued and unpaid interest) to be immediately due and payable;
(3) crystalize the floating charge created under the Security Trust Deed
in relation to any or all of the Mortgaged Property; and/or
(4) appoint a receiver over the Trust Assets or itself exercise the
powers that a receiver would otherwise have under the Security Trust Deed.
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The Security Trustee cannot exercise the powers referred to above unless
directed by an Extraordinary Resolution in the manner outlined above. The
Security Trustee is not obligated to act unless it obtains an indemnity from the
Voting Mortgagees, and is put in funds to the extent to which it may become
liable for the relevant enforcement actions.
For so long as the Note Trustee is the only Voting Mortgagee it may direct
the Security Trustee to do any act which the Security Trustee is required to do,
or may only do, at the direction of an Extraordinary Resolution of Voting
Mortgagees.
[Neither the Security Trustee nor the Trust Manager may call a meeting of
Voting Mortgagees while the Note Trustee is the only Voting Mortgagee, unless
the Note Trustee otherwise consents.]
The Note Trustee will be the only Voting Mortgagee for so long as the
amounts outstanding under the Notes are 75% or more of all amounts secured by
the Security Trust Deed.
Upon the occurrence of an Event of Default: (i) if the Note Trustee is the
only Voting Mortgagee; and (ii) if the Note Trustee directs the Security Trustee
to enforce the charge (whether directed to do so by Class A Noteholders or as
the Note Trustee determines on behalf of the Class A Noteholders), the Security
Trustee shall enforce the charge as if directed to do so by an Extraordinary
Resolution of Voting Mortgagees.
No Mortgagee is entitled to enforce the charge under the Security Trust
Deed, or appoint a receiver or otherwise exercise any power conferred by any
applicable law on charges, otherwise than in accordance with the Security Trust
Deed.
"Voting Mortgagee" means:
(1) for so long as the amounts outstanding under the Class A Notes and the
Class B Notes are 75% or more of all Secured Moneys, the Note Trustee alone; and
(2) at any other time: (i) the Note Trustee, acting on behalf of the
Noteholders under the Note Trust Deed and the Security Trust Deed; and (ii) each
other Mortgagee under the Security Trust Deed (other than the Noteholders).
Subject to being indemnified in accordance with the Security Trust Deed, the
Security Trustee shall take all action necessary to give effect to any direction
by the Note Trustee where it is the only Voting Mortgagee or to any
Extraordinary Resolution of the Voting Mortgagees and shall comply with all
directions given by the Note Trustee where it is the only Voting Mortgagee or
contained in or given pursuant to any Extraordinary Resolution of the Voting
Mortgagees in accordance with the Security Trust Deed.
No Noteholder is entitled to enforce the Security Trust Deed or to appoint
or cause to be appointed a receiver to any of the assets secured by the Security
Trust Deed or otherwise to exercise any power conferred by the terms of any
applicable law on charges except as provided in the Security Trust Deed.
If any of the Class A Notes remains outstanding and are due and payable
otherwise than by reason of a default in payment of any amount due on the Class
A Notes the Note Trustee must not vote under the Security Trust Deed to, or
otherwise direct the Security Trustee to, dispose of the Mortgaged Property
unless either:
(i) a sufficient amount would be realized to discharge in full all
amounts owing to the Class A Noteholders, and any other amounts payable by
the Issuer Trustee ranking in priority to or PARI PASSU with the Class A
Notes; or
(ii) the Note Trustee is of the opinion, reached after considering at any
time and from time to time the advice of a merchant bank or other financial
adviser selected by the Note Trustee, that the cash flow receivable by the
Issuer Trustee (or the Security Trustee under the Security Trust Deed) will
not
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(or that there is a significant risk that it will not) be sufficient, having
regard to any other relevant actual, contingent or prospective liabilities
of the Issuer Trustee, to discharge in full in due course all the amounts
referred to in paragraph (i).
Neither the Note Trustee nor the Security Trustee will be liable for any
decline in the value, nor any loss realized upon any sale or other dispositions
made under the Security Trust Deed, of any Mortgaged Property or any other
property which is charged to the Security Trustee by any other person in respect
of or relating to the obligations of the Issuer Trustee or any third party in
respect of the Issuer Trustee or the Notes or relating in any way to the
Mortgaged Property. Without limitation, neither the Note Trustee nor the
Security Trustee shall be liable for any such decline or loss directly or
indirectly arising from its acting, or failing to act, as a consequence of an
opinion reached by it.
The Note Trustee shall not be bound to vote under the Security Trust Deed,
or otherwise direct the Security Trustee under the Security Trust Deed or to
take any proceedings, actions or steps under, or any other proceedings pursuant
to or in connection with the Security Trust Deed, the Note Trust Deed, any Class
A Notes, unless directed or requested to do so (i) by an Extraordinary
Resolution of the Class A Noteholders or the Class B Noteholders, as
appropriate; or (ii) in writing by the holders of at least one-quarter of the
aggregate Invested Amount of the Class A Notes and then only if the Note Trustee
is indemnified to its satisfaction against all action, proceedings, claims and
demands to which it may render itself liable and all costs, charges, damages and
expenses which it may incur by so doing.
Only the Security Trustee may enforce the provisions of the Security Trust
Deed and neither the Note Trustee nor any holder of a Class A Note, is entitled
to proceed directly against the Issuer Trustee to enforce the performance of any
of the provisions of the Security Trust Deed, the Class A Notes (including the
Class A Conditions).
The rights, remedies and discretion of the Class A Noteholders under the
Security Trust Deed including all rights to vote or give instructions or consent
can only be exercised by the Note Trustee on behalf of the Class A Noteholders
in accordance with the Security Trust Deed. The Security Trustee may rely on any
instructions or directions given to it by the Note Trustee as being given on
behalf of the Class A Noteholders, from time to time and need not enquire
whether the Note Trustee or the Noteholders from time to time have complied with
any requirements under the Note Trust Deed or as to the reasonableness or
otherwise of the Note Trustee. The Security Trustee is not obliged to take any
action, give any consent or waiver or make any determination under the Security
Trust Deed without being directed to do so by the Note Trustee or by
Extraordinary Resolution of the Voting Mortgagees in accordance with the
Security Trust Deed.
Upon enforcement of the security created by the Security Trust Deed, the net
proceeds thereof may be insufficient to pay all amounts due on redemption to the
Noteholders. The proceeds from enforcement (which will not include amounts
required by law to be paid to the holder of any prior ranking security interest,
the proceeds of or amounts credited to the collateral account under the
Liquidity Facility Agreement and payable to the Liquidity Facility Provider and
the proceeds of cash collateral lodged with and payable to a Swap Provider or
other provider of a Support Facility will be applied in the order of priority as
set out in the Security Trust Deed (see "SECURITY FOR THE NOTES--Priorities
under the Security Trust Deed." Any claims of the Noteholders remaining after
realization of the security and application of the proceeds as aforesaid shall,
except in certain limited circumstances, be extinguished.
See "SECURITY FOR THE NOTES" for a description of the Security Trust Deed
and the order of priorities for the proceeds from the enforcement of the
Security Trust Deed.
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CERTAIN COVENANTS
So long as any of the Class A Notes or the Class B Notes remains
outstanding, the Issuer Trustee has made the following covenants for the benefit
of Class A Noteholders and the Class B Noteholders which are set out in the
Master Trust Deed, including the following:
(1) The Issuer Trustee shall act continuously as trustee of the Trust until
the Trust is terminated as provided by the Master Trust Deed or the Issuer
Trustee has retired or been removed from office in the manner provided under the
Master Trust Deed.
(2) The Issuer Trustee shall:
(i) act honestly and in good faith in the performance of its duties and
in the exercise of its discretion under the Master Trust Deed;
(ii) subject to the Master Trust Deed, exercise such diligence and
prudence as a prudent person of business would exercise in performing its
express functions and in exercising its discretion under the Master Trust
Deed, having regard to the interests of the Class A Noteholders and the
Class B Noteholders and other creditors and beneficiaries of the Trust;
(iii) use its best endeavors to carry on and conduct its business in so
far as it relates to the Master Trust Deed in a proper and efficient manner;
(iv) keep, or ensure that the Trust Manager keeps, accounting records
which correctly record and explain all amounts paid and received by the
Issuer Trustee;
(v) keep the Trust separate from each other trust which is constituted
under the Master Trust Deed and account for assets and liabilities of the
Trust separately from those of other trusts constituted under the Master
Trust Deed; and
(vi) do everything and take all such actions which are necessary
(including obtaining all appropriate authorizations) to ensure that it is
able to exercise all its powers and remedies and perform all its obligations
under the Master Trust Deed, the Transaction Documents and all other deeds,
agreements and other arrangements entered into by the Issuer Trustee under
the Master Trust Deed.
(3) Except as provided in the Master Trust Deed, the Issuer Trustee shall
not, nor shall it permit any of its officers to, sell, mortgage, charge or
otherwise encumber or part with possession of any Trust Assets.
(4) The Issuer Trustee's officers, employees, agents, attorneys, delegates
and sub-delegates shall duly observe and perform the covenants and obligations
of the Master Trust Deed in the same manner as is required of the Issuer
Trustee, and the Issuer Trustee agrees to indemnify the Trust Manager for its
own benefit or for the benefit of the Trust against any loss or damage that the
Trust, the Trust Manager, the Servicer, the Class A Noteholders, the Class B
Noteholders, the Beneficiaries (as defined in the Master Trust Deed) the holders
of RFSs (if any) and the holders of RFS Class A Notes (if any) or other
creditors incur or sustain in connection with, or arising out of, any breach or
default by such officers, employees, agents, delegates and persons in the
observance or performance of any such covenant or obligation, to the extent that
the Issuer Trustee would have been liable if that breach or default had been the
Issuer Trustee's own act or omission.
(5) The Issuer Trustee will open and operate certain bank accounts in
accordance with the Master Trust Deed and the Series Notice.
(6) Subject to the Master Trust Deed and any Transaction Document to which
it is a party, the Issuer Trustee shall act on all directions given to it by the
Trust Manager in accordance with the terms of the Master Trust Deed.
(7) The Issuer Trustee shall properly perform the functions which are
necessary for it to perform under all Transaction Documents in respect of the
Trust.
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THE NOTE TRUSTEE
will be the Note Trustee. The Note Trustee may resign at any time, in
which event the Issuer Trustee will be obligated to appoint a successor trustee.
The Issuer Trustee may also remove the Note Trustee if the Note Trustee ceases
to be eligible to continue as such under the Master Trust Deed, if the Note
Trustee becomes insolvent or if the rating assigned to the long-term unsecured
debt, obligations of the Trustee (or the holding company thereof) by the Rating
Agencies shall be lowered below or equivalent rating or be withdrawn by
any Rating Agency. In such circumstances and others set forth in the Master
Trust Deed, the Issuer Trustee will be obligated to appoint a successor trustee.
Any resignation or removal of the Note Trustee and appointment of a successor
trustee will not become effective until acceptance of the appointment by a
successor trustee.
GOVERNING LAW
The Notes and the Transaction Documents are governed by, and shall be
construed in accordance with, the laws of New South Wales, Australia.
DESCRIPTION OF THE SERVICING AGREEMENT
GENERAL
Under the Servicing Agreement, TMC will be appointed as the initial Servicer
of the Housing Loans and custodian of the Relevant Documents relating to the
Housing Loans and Mortgages. The following section contains a summary of the
material terms of the Servicing Agreement. The summary does not purport to be
complete and is subject to the provisions of the Servicing Agreement, which has
been filed as an exhibit to the Registration Statement.
SERVICING
The Servicer manages and services the Housing Loans in accordance with the
Servicing Agreement. To the extent not provided in the Servicing Agreement, the
Servicer shall manage and service the Housing Loans in accordance with the
Procedures Manual as that is interpreted and applied by the Servicer in the
ordinary course of its business. "Procedures Manual" means, in relation to the
Housing Loans, those policies and procedures of Westpac or the Servicer (as the
case may be) relating to the origination, management and enforcement of the
Housing Loans as those policies and procedures are amended in accordance with
the Servicing Agreement and applied from time to time in Westpac's or the
Servicer's ordinary course of business (as the case may be). To the extent not
covered by the Servicing Agreement or the Procedures Manual, the Servicer
manages and services the Housing Loans by exercising the degree of diligence and
care expected of an appropriately qualified servicer of the relevant financial
products and custodian of documents. All acts of the Servicer in servicing the
Housing Loans in accordance with the relevant procedures manual are binding on
the Issuer Trustee.
POWERS
Subject to the servicing standards set forth above and the limitations set
forth below, the Servicer has the express power, among other things, to the
extent such action will not cause an Adverse Effect (that is, an event which
will materially and adversely affect the amount of any payment to be made to any
Noteholder, or will materially and adversely affect the timing of such payment):
(1) to waive any fees and break costs which may be collected in the
ordinary course of servicing the Housing Loans or arrange the rescheduling
of interest due and unpaid following a default under any Housing Loans;
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(2) in its discretion, to waive any right in respect of any Housing
Loans and Mortgages in the ordinary course of servicing the Housing Loans
and Mortgages (including in accordance with its normal collection
procedures); and
(3) to grant an extension of maturity beyond 30 years from the date any
Housing Loan that relates to a Mortgage was made, when required to do so by
law or a government agency. The restriction on granting extensions that will
not have an Adverse Effect shall not apply where the extension is required
by law or a governmental agency.
DELEGATION BY THE SERVICER
The Servicer is entitled to delegate its duties under the Servicing
Agreement. The Servicer at all times remains liable for servicing the Housing
Loans and the acts or omissions of any delegate.
SERVICER UNDERTAKINGS
The Servicer has undertaken, among other things, the following:
(1) If so directed by the Issuer Trustee following a Title Perfection
Event, it will promptly take action to perfect the Issuer Trustee's
equitable title to the Housing Loans and related Mortgages in the Mortgage
Pool to full legal title by notifying the Issuer Trustee's interests to
Borrowers and mortgagors, registering transfers, delivering documents to the
Issuer Trustee and taking other action required to perfect title.
(2) In relation to Housing Loans of which Westpac is the legal owner, on
request from Westpac it will assist Westpac in collecting all moneys due
under those Housing Loans and Mortgages and pay them into the Collections
Account not later than the time Westpac would be required to do so.
(3) In relation to Housing Loans of which the Issuer Trustee is the
legal owner, it will collect all moneys due under those Housing Loans and
Mortgages and pay them into the Collections Account not later than the time
Westpac would be required to do so.
(4) If a material default occurs in respect of a Housing Loan, it will
take action in accordance with its normal enforcement procedures to enforce
the relevant Housing Loan and the related Mortgage to the extent it
determines to be appropriate.
(5) Act in accordance with the terms of any Mortgage Insurance Policies,
not to do or omit to do anything which could be reasonably expected to
prejudicially affect or limit its rights or the rights of the Issuer Trustee
under or in respect of a Mortgage Insurance Policy, and promptly make a
claim under any Mortgage Insurance Policy when it is entitled to do so and
notify the Trust Manager when each such claim is made.
(6) It will not consent to the creation or existence of any security
interest in favor of a third party in relation to any Mortgaged Property
which would rank before or PARI PASSU with the relevant Housing Loan and
Mortgage or any other security interest in the Mortgaged Property unless
priority arrangements are entered into with that third party under which the
third party acknowledges that the Housing Loan and the Mortgage ranks ahead
in priority to the third party security interest on enforcement for an
amount not less than the Unpaid Balance of the Housing Loan plus such other
amount as the Servicer determines in accordance with the Procedures Manual
or its ordinary course of business.
(7) It will not, except as required by law, release a Borrower or
otherwise vary or discharge any Housing Loan or Mortgage where it would have
an Adverse Effect.
(8) It will set the interest rate on the Housing Loans in accordance
with the requirements of the Series Notice.
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(9) If directed by the Issuer Trustee following a Title Perfection
Event, it will take action to perfect the Issuer Trustee's legal title to
the Housing Loans and related Mortgages.
(10) It will give notice in writing to the Issuer Trustee and the Rating
Agencies of it becoming aware of the occurrence of any Servicer Transfer
Event.
(11) It will maintain in effect all qualifications, consents, licenses,
permits, approvals, exemptions, filings and registrations as may be required
under any applicable law in order properly to service the Housing Loans and
Mortgages and to perform or comply with its obligations under this
Agreement.
(12) It will notify: (i) the Issuer Trustee and the Trust Manager of any
event which it reasonably believes is likely to have an Adverse Effect
promptly after becoming aware of such event; and (ii) the Trust Manager of
anything else which the Trust Manager reasonably requires regarding any
proposed modification to any Housing Loan or Mortgage.
(13) It will provide information reasonably requested by the Issuer
Trustee or the Trust Manager, with respect to all matters relating to the
Trust and the assets of the Trust, and the Issuer Trustee or the Trust
Manager believes reasonably necessary for it to perform its obligations
under the Transaction Documents, and upon reasonable notice and at
reasonable times permit the Issuer Trustee to enter the premises and inspect
the data base in relation to the Trust and the Relevant Documents.
WESTPAC UNDERTAKINGS
Westpac has undertaken, among other things, the following under the
Servicing Agreement:
(1) It will maintain in effect all qualifications, consents, licenses,
permits, approvals, exemptions, filings and registrations as may be required
under any applicable law in relation to its ownership of any Housing Loan or
Mortgage and to perform or comply with its obligations under the Servicing
Agreement; and comply with all Laws in connection with its ownership of any
Housing Loans and Mortgages where failure to do so would have an Adverse
Effect.
(2) It will cooperate with the Servicer in relation to the performance
by the Servicer of its duties under the Servicing Agreement, including,
without limitation, in relation to the enforcement of any Housing Loan or
Mortgage.
(3) If a material default occurs in respect to a Mortgage, take such
action as the Servicer directs it to take in accordance with the Servicing
Agreement.
(4) It will act in accordance with the terms of any Mortgage Insurance
Policies, and not do or omit to do anything which could be reasonably
expected to prejudicially affect or limit the rights of the Issuer Trustee
under or in respect of a Mortgage Insurance Policy to the extent those
rights relate to a Housing Loan and the Mortgage.
(5) It will not consent to the creation or existence of any Security
Interest in favor of a third party in relation to any Mortgaged Property in
connection with a Housing Loan and Mortgage:
(i) without limiting paragraph (5)(ii), unless priority arrangements
are entered into with that third party under which the third party
acknowledges that the Housing Loan and Mortgage ranks ahead in priority
to the third party Security Interest on enforcement for an amount not
less than the Unpaid Balance of the Housing Loan plus such other amount
as the Servicer determines in accordance with the Procedures Manual or
its ordinary course of business; or
(ii) which would rank before or PARI PASSU with the relevant Housing
Loan and Mortgage.
(6) It will not, except as required by law, release an Obligor from any
amount owing in respect of a Housing Loan or otherwise vary or discharge any
Housing Loan or Mortgage or enter into any
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agreement or arrangement which has the effect of altering the amount payable
in respect of a Housing Loan or Mortgage where it would have an Adverse
Effect.
(7) It will not release any Housing Loan or Mortgage, reduce the amount
outstanding under or vary the terms of any Housing Loan or grant other
relief to an Obligor, if required to do so by any law or if ordered to do so
by a court, tribunal, authority, ombudsman or other entity whose decisions
are binding on Westpac. If the order is due to Westpac breaching any
applicable law then Westpac must indemnify the Issuer Trustee for any loss
the Issuer Trustee may suffer by reason of the order. The amount of the loss
is to be determined by agreement with the Issuer Trustee or failing this, by
Westpac's external auditors.
(8) It will notify the Servicer immediately of each request by an
Obligor to borrow further moneys under or in relation to a Mortgage.
PERFORMANCE OF SERVICES
In performing any services under the Servicing Agreement the Servicer shall
have regard to whether its performance of such services does or does not have
any Adverse Effect. The Servicer may ask the Issuer Trustee or the Trust Manager
if, and may rely upon any statement by the Issuer Trustee or the Trust Manager
that, any action or inaction on its part is reasonably likely to, or will, have
an Adverse Effect. The Servicer shall not be liable for a breach of the Servicer
Agreement, or be liable under any indemnity, in relation to any action or
inaction on its part, where it has been notified by the Issuer Trustee or the
Trust Manager that the action or inaction is not reasonably likely to, or will
not have an Adverse Effect.
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The Servicer is entitled to a fee (the "Servicing Fee") for servicing the
Housing Loans, payable in arrears on the Payment Date following the end of the
Collection Period. The Servicing Fee is based on the average daily balance of
Housing Loan Principal during the Collection Period and on the actual number of
days in that Collection Period divided by 365 days.
The Servicer must pay from such fee all expenses incurred in connection with
servicing the Housing Loans except for expenses relating to the enforcement of
any Housing Loan or its related securities, the recovery of any amounts owing
under any Housing Loan or any amount repaid to a liquidator or trustee in
bankruptcy pursuant to any applicable law, binding code, order or decision of
any court, tribunal or the like or based on advice of the Servicer's legal
advisers.
SERVICER TRANSFER EVENT AND REMOVAL
The Issuer Trustee may only terminate the Servicer's appointment if the
Issuer Trustee determines that a Servicer Transfer Event has occurred and is
continuing. A "Servicer Transfer Event" is any of the following:
(1) an Insolvency Event occurs with respect to the Servicer;
(2) the Servicer fails to pay any amount within five Business Days of
receipt of a notice to do so;
(3) the Servicer fails to comply with any of its other obligations under
any Transaction Document and such action has had, or, if continued will
have, an Adverse Effect (as determined by the Issuer Trustee) and that
failure is not remedied within 30 days after the Servicer becomes aware of
that failure by receipt of notice;
(4) any representation, warranty or certification made by the Servicer
is incorrect when made and is not waived by the Issuer Trustee or remedied
to the Issuer Trustee's reasonable satisfaction within 90 days after notice
from the Issuer Trustee, and the Issuer Trustee determines that breach would
have an Adverse Effect; or
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(5) if it is unlawful for the Servicer to perform the services under the
Servicing Agreement.
In the event of a Servicer Transfer Event, the Issuer Trustee must, upon
notice to the Trust Manager, the Approved Sellers, Westpac, the Servicer and the
Rating Agencies, terminate the rights and obligations of the Servicer with
immediate effect and appoint an Eligible Servicer. Until an Eligible Servicer is
appointed and that Eligible Servicer agrees to act as the servicer, the Issuer
Trustee shall act as the Servicer and is entitled to the fee for so acting.
Subject to certain limitations, the Servicer has indemnified the Issuer
Trustee against any expense, loss, damage or liability incurred as a result of a
Servicer Transfer Event or a failure by the Servicer to perform its duties under
the Servicing Agreement.
RESIGNATION
The Servicer must not resign without first giving three months' notice to
the Rating Agencies, the Trust Manager and the Issuer Trustee. If an Eligible
Servicer has not agreed to act as Servicer by the expiration of that notice
period the Issuer Trustee shall act as Servicer and be entitled to the Servicing
Fee.
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DOCUMENT CUSTODY
GENERAL
The Servicer will be responsible for custody of the Relevant Documents on
behalf of the Issuer Trustee. The Servicer must hold those documents as
custodian at the direction of the Issuer Trustee in accordance with its standard
safekeeping practices and in the same manner and to the same extent that it
holds similar documents for Westpac. The Servicer will hold custody of the
Relevant Documents in accordance with procedures contained in the Servicing
Agreement. The procedures include the following: (i) keeping the Relevant
Documents for Housing Loans in the Mortgage Pool separate from other documents;
(ii) maintaining reports on movements of the Relevant Documents; and (iii) being
able to locate security packets containing the Relevant Documents.
The Servicer will be audited on an annual basis (or more regularly if any
audit gives an adverse finding) in relation to its custodial procedures,
identification of documents, security and tracking systems.
TERMINATION OF SERVICER AS DOCUMENT CUSTODIAN
If any of the following occurs:
(1) the Servicer does not comply with the requirements of the Servicing
Agreement to the satisfaction of the auditor, and a further audit also
results in an adverse finding by the auditor;
(2) the long term credit rating of the holding company of the Servicer
is downgraded:
(i) below BBB by Standard & Poor's;
(ii) below Baa2 by Moody's; or
(iii) below BBB by Fitch
(3) the Servicer is in default under a servicing agreement between it
and any other person, and by reason of the default that other person removes
any documents in the Servicer's custody under the servicing agreement where
that person would otherwise not have been entitled to do so; or
(4) a Servicer Transfer Event occurs and is subsisting,
then the Servicer must deliver the Relevant Documents to, or at the direction
of, the Issuer Trustee. If the Servicer does not do so within 10 Business Days
(or such longer period as the Trustee permits), then the Issuer Trustee must
enter the premises where the Relevant Documents are kept, take possession of and
remove the Relevant Documents. If the Issuer Trustee does not have possession of
the documents within that period it must lodge caveats in relation to and/or
take all other action it considers necessary to protect its interests.
AMENDMENT
The Servicing Agreement may be amended by the parties thereto in writing and
provided that prior notice of any proposed amendment is given to the Rating
Agencies.
TERMINATION OF SERVICING AGREEMENT
THE SERVICING AGREEMENT SHALL CONTINUE UNTIL THE EXPIRATION OF THE TERM.
The "Term" means the period from the date of the Servicing Agreement until
the earlier of:
(a) the date on which the Servicing Agreement is terminated pursuant to
a Servicer Transfer Event;
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(b) the date which is one month after the Notes have been redeemed in
full in accordance with the Transaction Documents and the Trustee ceases to
have any obligation to any creditor in relation to any Trust;
(c) the date on which the Trustee replaces the Servicer with an Eligible
Servicer; and
(d) the date on which the Servicer is replaced after resigning pursuant
to the Servicing Agreement.
THE LIQUIDITY FACILITY
The following section contains a summary of the material terms of the
Liquidity Facility. The summary does not purport to be complete and is subject
to the provisions of the Liquidity Facility, a form of which has been filed as
an exhibit to the Registration Statement.
GENERAL DESCRIPTION
Under the Liquidity Facility, the Liquidity Facility Provider agrees to make
advances to the Issuer Trustee for the purpose of funding certain income
shortfalls in the Trust, up to an aggregate amount being the lesser of:
(1) A$;
(2) the Unpaid Balance of all Performing Loans at that date; and
(3) any lesser amount as is agreed in writing between the Liquidity
Facility Provider, the Issuer Trustee, the Trust Manager and the Rating
Agencies for each class of Notes, as reduced or cancelled under the
Liquidity Facility (the "Liquidity Limit").
A "Performing Loan" at any date is a Housing Loan which is not Delinquent or
has been Delinquent for less than 90 consecutive days, or if it has been
Delinquent for 90 or more consecutive days was insured under a Mortgage
Insurance Policy at the date of the Liquidity Facility on or before the Closing
Date.
A Housing Loan is "Delinquent" if the related Borrower fails to pay any
amount due on the related due date. Delayed payments arising from agreed payment
holidays based on early repayments, or from maternity or paternity leave
repayment reductions will not, by themselves, lead to a Housing Loan being
Delinquent.
LIQUIDITY DRAWS
If the Trust Manager determines on any Collection Determination Date that
the Available Income of the Trust plus Principal Draws for the Collection Period
relating to that Collection Determination Date is insufficient to meet Total
Payments of the Trust (a "Liquidity Shortfall"), then the Trust Manager must
direct the Issuer Trustee to request a drawing under the Liquidity Facility to
apply towards the Liquidity Shortfall. The drawing will (subject to certain
assumptions as to payment) be the lesser of the Liquidity Shortfall and the
difference between the Liquidity Limit and the aggregate of all outstanding
amounts under the Liquidity Facility (the "Available Liquidity Amount"). A
drawing may only be made by a duly completed drawdown notice signed by an
authorized signatory of the Issuer Trustee.
CONDITIONS PRECEDENT TO A LIQUIDITY DRAW
A drawing may only be made under the Liquidity Facility (a "Liquidity Draw")
if (among other things) no event of default (see "--Events of Default" below)
subsists at the date of the relevant drawdown notice and the relevant drawdown
date or will result from the provision of the Liquidity Draw.
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DEPOSIT INTO A COLLATERAL ACCOUNT
If at any time the Liquidity Facility Provider's short term credit rating is
less than A-1+ from Standard & Poor's, P-1 from Moody's or F-1+ from Fitch, the
Liquidity Facility Provider must within five Business Days or such longer period
as the Rating Agencies confirm will not result in a downgrade, withdrawal or
qualification of the Offered Notes, deposit into an account held in the name of
the Issuer Trustee (the "Collateral Account") an amount equal to the Available
Liquidity Amount at that time.
If and for so long as the Liquidity Facility Provider has a short term
credit rating of not lower than A-1 from Standard & Poor's, P-1 from Moody's and
F-1 from Fitch, the Collateral Account shall be maintained with the Liquidity
Facility Provider.
If at any time the short term credit rating of the bank holding the
Collateral Account is less than A-1 from Standard & Poor's, P-1 from Moody's and
F-1 from Fitch then the balance of the Collateral Account, and all amounts
standing to the credit of the Collateral Account, must (subject to certain
limited restrictions) within five Business Days be transferred to a bank with a
short term credit rating from Standard & Poor's of not lower than A-1+, not
lower than P-1 from Moody's and not lower than F-1+ from Fitch.
If the short term credit rating of the Liquidity Facility Provider is not
less than A-1 from Standard & Poor's, P-1 from Moody's and F-1 from Fitch, and
the total of the credit balance of the Collateral Account with the Liquidity
Facility Provider plus the amount of all short term investments of the Issuer
Trustee is greater than 20% of the Total Invested Amount, then so much of the
credit balance of the Collateral Account as is necessary for the 20% threshold
not to be breached must (subject to certain limited restrictions) be deposited
with a bank with a short term credit rating from Standard & Poor's of not lower
than A-1+ and not lower than P-1 from Moody's and not lower than F-1+ from
Fitch.
Withdrawals from a Collateral Account are restricted to, among other things,
making a Liquidity Draw, paying financial institutions duty and bank account
debit tax (being taxes charged on account transactions) and investing in short
term investments.
All interest accrued on the moneys in the Collateral Account shall belong to
the Liquidity Facility Provider. If the Liquidity Facility Provider's short term
credit rating is upgraded to not lower than A-1+/ P-1/F-1+, then the balance in
the Collateral Account must be repaid within five Business Days to the Liquidity
Facility Provider and any advances under the Liquidity Facility thereafter will
be made directly from the Liquidity Facility Provider in the normal course of
business.
INTEREST ON LIQUIDITY DRAWS
Interest is payable to the Liquidity Facility Provider on the principal
amount drawn under the Liquidity Facility. This interest is payable at the Bank
Bill Rate plus a margin, calculated on days elapsed and a year of 365 days.
Interest is payable on each Payment Date and on repayment of a drawing. Unpaid
interest will capitalize, and interest accrues on any unpaid interest.
COMMITMENT FEE
A commitment fee accrues daily from the date of the Liquidity Facility on
the Available Liquidity Amount, and is payable on each Payment Date and on
termination of the facility.
The commitment fee is calculated on the actual number of days elapsed and a
year of 365 days.
REPAYMENT OF LIQUIDITY DRAWINGS
If an amount has been drawn down under the Liquidity Facility, the principal
amount is repayable on the following Payment Date, to the extent that amounts
are available for this purpose under the Series Notice; see "DESCRIPTION OF THE
OFFERED NOTES--Distribution of Total Available
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Funds" above. It is not an event of default if the Issuer Trustee does not have
funds available to repay the full amount outstanding on the following Payment
Date.
EVENTS OF DEFAULT
It is an event of default under the Liquidity Facility (whether or not such
event is within the control of the Issuer Trustee) if:
(1) at any time the Available Liquidity Amount is zero, and the Issuer
Trustee fails to pay an amount payable by it under the Liquidity Facility
within 10 Business Days of its due date;
(2) an amount is available for payment under the Liquidity Facility and
the Issuer Trustee does not pay that amount;
(3) an Insolvency Event occurs in relation to the Trust;
(4) an Insolvency Event occurs in relation to the Issuer Trustee, and a
successor trustee of the Trust is not appointed within 30 days of that
Insolvency Event;
(5) the Termination Date occurs in relation to the Trust; or
(6) all or any part of the Liquidity Facility is terminated or is or
becomes void, illegal, invalid or unenforceable.
CONSEQUENCES OF DEFAULT
In addition to rights provided by law or any Transaction Document, at any
time after an event of default has occurred under the Liquidity Facility
(whether or not it is continuing), the Liquidity Facility Provider may do all or
any of the following by notice to the Issuer Trustee and the Trust Manager:
(1) declare all moneys actually or contingently owing at that time
immediately due and payable, and the Issuer Trustee must immediately pay the
total amount of all outstanding Liquidity Draws, together with accrued
interest and fees and all other such moneys; and
(2) cancel the Liquidity Limit with effect from any date specified in
that notice.
TERMINATION
The Liquidity Facility will terminate on the earliest of the following to
occur:
(1) the date on which the Issuer Trustee enters into a replacement
liquidity facility as previously notified to the Rating Agencies;
(2) one month after the Notes have been redeemed in full in accordance
with the Master Trust Deed;
(3) following an event of default under the Liquidity Facility, the date
on which the Liquidity Facility Provider declares the Liquidity Facility
terminated; and
(4) the date on which the Issuer Trustee has cancelled the Liquidity
Limit in full.
Cancellation is conditional on the Rating Agencies confirming that such
cancellation will not result in a downgrade, withdrawal or qualification of the
credit rating assigned by the Rating Agencies to the Notes.
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DESCRIPTION OF THE SWAP AGREEMENTS
DESCRIPTION OF INTEREST RATE SWAP AGREEMENTS
The following section contains a summary of the material terms of the Swap
Agreements, which the Issuer Trustee will enter into with the Interest Rate Swap
Provider. The summary does not purport to be complete and is subject to the
provisions of the Swap Agreements.
FIXED RATE AND VARIABLE RATE BASIS SWAPS
The Issuer Trustee will enter into a Variable Rate Basis Swap and two Fixed
Rate Basis Swaps with Westpac, in its capacity as the provider of the Variable
Rate Basis Swap and Westpac, in its capacity as the provider of the Fixed Rate
Basis Swaps (together the "Interest Rate Swap Provider"). Such swaps will use
the ISDA Master Agreement amended by a supplementary schedule and a confirmation
for each swap. See "ORIGINATOR OF THE HOUSING LOANS" for a description of the
Interest Rate Swap Provider.
A Variable Rate Basis Swap will be used to hedge the basis risk between the
floating rate obligations of the Trust (including Interest payable on the Notes)
and the variable rate set, as permitted by the relevant Housing Loan agreements,
at the discretion of Westpac. The Variable Rate Basis Swap will include those
loans with a concessional fixed rate of interest for the first 12 months,
converting to the standard variable rate after that period. The Issuer Trustee
will pay an amount based on the applicable daily weighted average variable
housing rates and receive the Bank Bill Rate (as defined herein) plus a fixed
margin. The margin is fixed for the life of the swap and has been set having
regard to the ongoing obligations of the Trust.
Two Fixed Rate Basis Swaps will be used to hedge the basis risk between the
floating rate obligations of the Trust (including Interest payable on the Notes)
and the discretionary fixed rates set by Westpac on the Housing Loans which are
subject to a fixed rate of interest (not including those loans with a
concessional fixed rate of interest for the first 12 months, which converts to
the standard variable rate after that period).
The first Fixed Rate Basis Swap will be used to hedge the basis risk
occurring when Borrowers switch from a variable rate of interest to a Fixed Rate
of interest after the Cut-Off Date. The Issuer Trustee will pay the applicable
daily weighted average Fixed Rate and the Interest Rate Swap Provider will pay
the Bank Bill Rate plus a fixed margin. The margin is fixed for the life of the
swap and has been set having regard to the ongoing obligations of the Trust.
The second Fixed Rate Basis Swap will be entered into as at the Closing Date
to hedge those Housing Loans subject to a Fixed Rate of interest as of the
Cut-Off Date. The Issuer Trustee will pay the applicable daily weighted average
Fixed Rate and the Interest Rate Swap Provider will pay the Bank Bill Rate plus
a fixed margin. The margin is fixed for the life of the swap and has been set
based on the actual margin on the Fixed Rate Housing Loans and the prevailing
wholesale market rate existing at or about the Cut-Off Date.
All Housing Loans being charged a Fixed Rate of interest as of the Cut-Off
Date have a maximum Fixed Rate period of 5 years.
DOWNGRADE OF INTEREST SWAP PROVIDER
If there is a downgrading of the Interest Rate Swap Provider's long term or
short term debt rating below A-1+, A2 or F-1+ by either Standard & Poor's,
Moody's or Fitch, respectively, the Interest Swap Provider will either:
(1) provide cash collateral security sufficient to enable Standard &
Poor's, Moody's and Fitch to confirm that the downgrade will not cause a
reduction in or a withdrawal of the rating of the Notes; or
(2) arrange for a suitably rated counterparty to intermediate the swap
or act as substitute swap provider.
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TERMINATION
The following events are events of default under the Interest Rate Swap
Agreements: (i) failure by Westpac or the Issuer Trustee to make, when due, any
payment or delivery required by the agreement and such failure is not remedied
by the tenth local business day; and (ii) an Insolvency Event has occurred in
respect of Westpac or the Issuer Trustee; provided, however, that an Insolvency
Event in relation to the Issuer Trustee in its personal capacity is not an event
of default if the relevant Swap is novated within 30 Business Days of that
Insolvency Event and the novation will not cause a reduction or withdrawal of
the rating of the Notes. Upon novation of the Swap, the successor Issuer Trustee
will assume the rights and obligations of the Issuer Trustee under the Interest
Rate Swap.
An event which constitutes illegality will be a termination event under the
Interest Rate Swap Agreements. If there is a downgrading of the Interest Rate
Swap Provider's short term debt rating below A-l+, A2 or F-1+ by either Standard
& Poor's, Moody's or Fitch and the Interest Rate Swap Provider fails to act, as
described in "--Downgrade of Interest Swap Provider" above, it will be an
"Additional Termination Event" under the Variable Rate Basis Swap. If under
similar circumstances the Interest Rate Swap Provider fails to establish certain
collateral arrangements it will be an "Additional Termination Event" under each
of the Fixed Rate Basis Swaps only at the discretion of the Issuer Trustee. The
"Automatic Early Termination" provisions under the Fixed and Variable Rate Basis
Swaps do not apply.
Upon the termination of an Interest Rate Basis Swap, a termination payment
calculated pursuant to the Loss Method (as defined in such Interest Rate Basis
Swap) will be due to be paid by the Issuer Trustee to the Interest Rate Swap
Provider or by the Interest Rate Swap Provider to the Issuer Trustee. The
termination payment with respect to the Variable Rate Basis Swap will be zero.
The Issuer Trustee may look to any cash collateral security posted by the
Interest Rate Swap Provider relating to the terminated Interest Rate Basis Swap
for satisfaction of the Interest Rate Swap Provider's termination payment.
NOVATION
Upon the novation of a Interest Rate Swap Agreement, either the Interest
Rate Swap Provider will pay to the substitute Interest Rate Swap Provider an
up-front premium or the substitute Interest Rate Swap Provider will pay to the
Interest Rate Swap Provider an up-front premium to preserve the economic
equivalent of the mark-to-market value of the swap transaction as of the date of
novation. The Issuer Trustee will not bear any risk with respect to the novation
of an Interest Rate Swap unless the Interest Rate Swap Provider is unable to pay
any required up-front premium and there is insufficient cash collateral security
posted with respect to such Interest Rate Swap to cover such premium.
THRESHOLD RATE
If at any time the Variable Rate Basis Swap is terminated, the Trust Manager
must, on each Collection Determination Date following that termination,
calculate the minimum rate of interest that must be set on the Housing Loans
which are subject to a discretionary variable rate, in order to cover (assuming
all counterparties to the Transaction Documents, the Housing Loans and any
Mortgages and other relevant securities meet their obligations), when aggregated
with the income produced by all other Housing Loans and taking into account the
other Swap Agreements, the obligations of the Trust (the "Threshold Rate"). If
the Servicer is notified of the Threshold Rate, it is required, subject to the
terms of the relevant Housing Loans, to ensure that the rate of interest on each
relevant discretionary variable rate Housing Loan is not less than the Threshold
Rate (see "DESCRIPTION OF THE SERVICING AGREEMENT" above).
DESCRIPTION OF CURRENCY SWAP
The following summary describes certain terms of the Currency Swap, which
the Issuer Trustee will enter into with Morgan Guaranty Trust Company of New
York, acting through its Sydney Branch and Westpac (together, the "Currency Swap
Providers" and together with the Interest Rate Swap Provider, the "Swap
Providers"). The summary does not purport to be complete and is qualified in its
entirety by reference to the provisions of the Currency Swap. The Currency Swap
is provided on a joint and several basis by Westpac and Morgan Guaranty Trust
Company of New York, acting through its Sydney Branch.
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Collections in relation to the Housing Loans and related Mortgages and under
the Variable Rate Basis Swap and the Fixed Rate Basis Swap ("Collections") will
be denominated in Australian dollars. However, the payment obligations of the
Issuer Trustee in relation to Interest and principal on the Notes are
denominated in United States dollars. To hedge its currency exposure, the Issuer
Trustee will enter into two distinct swap transactions, relating to the Class A
Notes and the Class B Notes, respectively (together, the "Currency Swap") with
the Currency Swap Providers. The Currency Swap will be evidenced by two swap
confirmations which will be governed by an ISDA Master Agreement dated ,
1998, as supplemented by the Schedule thereto (such ISDA Master Agreement,
Schedule and swap confirmations, the "Agreement"). Under the Currency Swap, the
Issuer Trustee is required to pay to the Currency Swap Providers amounts in A$
equal to the amount of any Principal Collections received by the Issuer Trustee
and the Currency Swap Providers are required to pay to or at the direction of
the Issuer Trustee an amount denominated in US$ which is equivalent to such A$
payment (calculated by reference to an exchange rate which is fixed at the
Closing Date and set forth in the swap confirmations). In addition, under the
Currency Swap on each Payment Date the Issuer Trustee will make A$ floating rate
payments to the Currency Swap Providers and the Currency Swap Providers will
make US$ floating rate payments which are equivalent in amount to the Interest
payable in US$ to the Noteholders. If on any Payment Date, the Issuer Trustee
does not make the full floating payment, the US$ floating rate payment to be
made by the Currency Swap Providers on such Payment Date will be reduced by the
same proportion as the reduction in the payment from the Issuer Trustee.
Subscription amounts for the Notes will be paid by investors in US$, but the
consideration for the purchase by the Issuer Trustee of equitable title to the
Housing Loans and related Mortgages will be in A$. Under the Currency Swap, an
amount equal to the US$ subscription amounts will be paid to the Currency Swap
Providers, which will pay the A$ Equivalent of such amounts to the Issuer
Trustee. See "CURRENCY SWAP PROVIDERS" below for more information.
In the event that one of the Currency Swap Providers is ever downgraded
below a specified level such that the rating on the Class A Notes would be
downgraded or qualified, the Currency Swap Providers will give a commitment to
provide cash collateral or other credit enhancement in respect of the Currency
Swap.
The Currency Swap comprises two distinct swap transactions, relating to the
Class A Notes and the Class B Notes respectively. On the Closing Date the Issuer
Trustee will be obliged to pay to the Currency Swap Providers an amount equal to
the proceeds of the issue of the Notes in US$. In return the Issuer Trustee will
be paid the A$ equivalent of that US$ amount (calculated by reference to an
exchange rate which is fixed by the Closing Date (in the Swap confirmations)).
The cash flow methodology in the Series Notice provides that amounts equal
to certain amounts allocated from Principal Collections and (in some cases) from
Excess Available Income are paid by the Issuer Trustee to the Currency Swap
Providers on each Payment Date. Under the Currency Swap the Currency Swap
Providers pay to the Issuer Trustee, against receipt of the A$ denominated
payment, an amount denominated in US$ which is equivalent to the A$ payment from
the Issuer Trustee (calculated by reference to the exchange rate referred to
above).
The cash flow methodology in the Series Notice provides that the Issuer
Trustee also pays to the Currency Swap Providers amounts equal to scheduled A$
floating rate payments (the A$ Class A Interest Amount and the A$ Class B
Interest Amount) on each Payment Date. Under the Currency Swap the Currency Swap
Providers pay to the Issuer Trustee on each Payment Date, against receipt of
those A$ denominated payments, scheduled US$ floating rate payments equivalent
to the Interest due to the Noteholders. If on any Payment Date the Issuer
Trustee does not make the full scheduled A$ payment, the scheduled US$ payment
from the Currency Swap Providers will be reduced by the same proportion as the
reduction in the payment from the Issuer Trustee.
The Series Notice requires that the US$ amounts received by the Issuer
Trustee from the Currency Swap Providers are paid to the Noteholders in
accordance with their entitlements and the priorities set out in "DESCRIPTION OF
THE OFFERED NOTES."
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TERMINATION OF THE CURRENCY SWAP
Under the Currency Swap, the Currency Swap Providers have the following
rights to terminate:
(1) An immediate right of termination if the Issuer Trustee fails to
make a payment under the Currency Swap within the applicable grace period of
10 Business Days.
(2) If due to change in law it becomes illegal for either party to make
or receive payments or comply with any other material provision of the
Currency Swap, the Currency Swap requires each party to make certain efforts
to transfer their rights and obligations to avoid this illegality. If those
efforts are not successful then the Currency Swap Providers will have the
right to terminate. These provisions relating to termination following an
illegality have been modified so that they are not triggered by the
introduction of certain exchange controls by any Australian Government body.
(3) The Currency Swap Providers have the limited right to terminate
where it is required to gross-up or receive payments from which amounts have
been withheld.
(4) Any Event of Default under the Conditions of the Notes occurs.
If neither the Currency Swap Providers nor the Issuer Trustee elect to
terminate the Currency Swap following an Event of Default under the Conditions
of the Notes occurs, then the Note Trustee may do so.
TERMINATION BY THE ISSUER TRUSTEE
There are a number of circumstances in which the Issuer Trustee has the
right to terminate the Currency Swap. In each of these cases it is only
permitted to exercise that right if directed by the Trust Manager and with the
prior written consent of the Note Trustee:
(1) Where the Currency Swap Providers fail to make a payment under the
Currency Swap within any applicable grace period or the Currency Swap
Providers become insolvent or merge into another entity without that entity
properly assuming responsibility for the obligations of the Currency Swap
Providers under the Currency Swap.
(2) If it becomes illegal for either party to make or receive payments
under the Currency Swap or perform any of its other material obligations
under it, both the Issuer Trustee and the Currency Swap Providers are
obliged to make certain efforts to transfer their rights and obligations to
avoid that illegality. If those efforts fail the Currency Swap may be
terminated.
(3) If the Issuer Trustee becomes obliged under the Currency Swap to
receive payments from which amounts have been withheld or deducted
(including where this situation arises from a merger affecting the Currency
Swap Providers).
(4) Any Event of Default under the Conditions of the Notes occurs.
(5) The Currency Swap may also be terminated if the Issuer Trustee
becomes obliged to make a withholding or deduction in respect of the Notes
and the Notes are redeemed as a result or if the Issuer Trustee is or will
be subject to certain increased costs or expenses.
If neither the Currency Swap Providers nor the Issuer Trustee elect to
terminate the Currency Swap following an Event of Default under the Conditions
of the Notes occurs, then the Note Trustee may do so.
The Issuer Trustee (and the Note Trustee) may only terminate the Currency
Swap following prior consultation by the Note Trustee with the Currency Swap
Providers as to the timing of termination.
TERMINATION PAYMENTS
On the Termination Date or the Early Termination Date (each as defined in
the Currency Swap) in respect of the Currency Swap, a termination payment will
be due to be paid by the Issuer Trustee to the Currency Swap Providers or to the
Issuer Trustee by the Currency Swap Providers in respect of the Currency Swap.
There is no guarantee that upon any such termination the funds realized from the
sale of the relevant Loans and Mortgages plus or minus (as the case may be) the
termination payment due in respect of the Currency Swap will be sufficient to
pay in full amounts owing to the holders of the relevant Notes.
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The termination payment in respect of a Currency Swap will be determined on
the basis of quotations from four leading dealers in the relevant market
(selected by the Currency Swap Providers) to enter into a replacement
transaction that would have the effect of preserving the economic equivalent of
any payment that would, but for the early termination, have been required under
the terms of the Currency Swap.
REPLACEMENT OF CURRENCY SWAP
If the Currency Swap is terminated, the Issuer Trustee may at the direction
of the Trust Manager enter into a currency swap which replaces the Currency Swap
(other than by way of transfer under section 6(b) of the Currency Swap) (a
"Replacement Currency Swap") if and only if the amount payable (if any) to the
Issuer Trustee by the provider of the Replacement Currency Swap as an up front
premium to enter into the Replacement Currency Swap is greater than or equal to
the termination payment payable (if any) to the Currency Swap Providers by the
Trustee on termination of the Currency Swap. If the condition in the previous
sentence is satisfied, the Issuer Trustee may enter into the Replacement
Currency Swap and if it does so it must direct the amount payable (if any) by
the provider of the Replacement Currency Swap to be paid directly to the
Currency Swap Providers in satisfaction of and to the extent of the Issuer
Trustee's obligation to pay the termination payment to the Currency Swap
Providers.
DOWNGRADE OF CURRENCY SWAP PROVIDERS
The Currency Swap Providers, severally, will give a commitment to provide
cash collateral or other credit enhancement in respect of the Currency Swap in
the event that the rating of one of the Currency Swap Providers is ever
downgraded below a specified level, such that the Rating Agencies would
downgrade the rating on the Class A Notes.
CURRENCY SWAP PROVIDERS
Morgan Guaranty Trust Company of New York, acting through its Sydney Branch,
and Westpac are joint providers of the Currency Swap.
Morgan Guaranty Trust Company of New York, a Delaware corporation whose
principal office is located in New York, New York ("Morgan Guaranty"), is a
wholly owned subsidiary and the principal asset of J.P. Morgan & Co.
Incorporated ("J.P. Morgan"). Morgan Guaranty is a commercial bank offering a
wide range of banking services to its customers both domestically and
internationally. Its business is subject to examination and regulation by
Federal and New York State banking authorities. As of December 31, 1997, Morgan
Guaranty and its subsidiaries had total assets of $196.4 billion, total net
loans of $30.9 billion, total deposits of $60.7 billion, and stockholder's
equity of $10.4 billion. As of December 31, 1996, the Currency Swap Provider and
its subsidiaries had total assets of $164.8 billion, total net loans of $27.4
billion, total deposits of $53.1 billion and stockholder's equity of $9.9
billion.
The Consolidated Statement of Condition of Morgan Guaranty as of December
31, 1997 is set forth on page 11 of Exhibit 99b to Form 8-K dated January 15,
1998, as filed by J.P. Morgan with the Commission. Morgan Guaranty will provide
without charge to each person to whom this Prospectus is delivered, on the
request of any such person, a copy of the Form 8-K referred to above. Written
requests should be directed to: Morgan Guaranty Trust Company of New York, 60
Wall Street, New York, New York 10260-0060, Attention: Office of the Secretary.
For a description of Westpac, see "ORIGINATOR OF THE HOUSING LOANS".
The information with respect to the Currency Swap Providers contained herein
has been obtained from the Currency Swap Providers. The delivery of this
Prospectus will not create any implication that there has been no change in the
affairs of the Currency Swap Providers since the date hereof or that the
information contained or referred to herein is correct as of any time subsequent
to its date. The Currency Swap Providers have not had any involvement in the
preparation of any part of this Prospectus, other than the information with
respect to the Currency Swap Providers set forth in this section and under the
heading "DESCRIPTION OF THE SWAP AGREEMENTS--Description of Currency Swap." The
Currency Swap Providers make no statement or representation in this Prospectus
(other than the information referred to above), have not authorized or caused
the issue of any part of it and take no responsibility for any part of it.
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THE OFFERED NOTES DO NOT REPRESENT AN OBLIGATION OF THE CURRENCY SWAP
PROVIDERS, J.P. MORGAN SECURITIES INC., J.P. MORGAN OR ANY OF THEIR RESPECTIVE
AFFILIATES. HOLDERS OF THE OFFERED NOTES WILL NOT HAVE ANY RIGHT TO PROCEED
DIRECTLY AGAINST THE CURRENCY SWAP PROVIDERS IN RESPECT OF THE CURRENCY SWAP
PROVIDERS' OBLIGATIONS UNDER THE CURRENCY SWAP.
CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS
The following discussion contains summaries of legal aspects of Australian
retail housing loans and mortgages that are general in nature. The summaries do
not purport to be complete. In addition, certain of those legal aspects are
governed by state law (which laws may differ substantially from state to state),
and the summaries do not reflect the particular laws of any particular state or
encompass all relevant laws of all states in which any Mortgaged Property may be
situated. The summaries are subject to the applicable Australian federal and
state laws governing real property and the granting and enforcement of security
over real property.
GENERAL
Each Housing Loan will be secured by a mortgage which is to have a first
ranking priority over all other mortgages granted by the relevant Borrower and
over all unsecured creditors of the Borrower (except in respect of certain
statutory rights such as some rates and taxes, which are granted statutory
priority). The Borrower is prohibited under its loan documents from creating
another mortgage or other security interest over the relevant Mortgaged Property
without the consent of Westpac. There are two parties to a mortgage, the
mortgagor, who is the borrower and homeowner (or, where the relevant loan is
guaranteed and the guarantee is secured by a mortgage, the guarantor) and who
grants the mortgage over their property, and the mortgagee who is the lender.
Under Torrens title, registration of a mortgage using the prescribed form
executed by the mortgagor is required in order for the mortgagee to obtain the
remedies of a mortgagee granted by statute and the relevant priorities against
other secured creditors. To this extent the mortgagee is said to have a legal
(i.e., registered) title. However, registration does not transfer title in the
property--the mortgagor remains as legal owner. Rather, the Torrens mortgage
operates as a statutory charge. The mortgagee does not obtain an estate in the
property but does have an interest in the land which is marked on the register
and the "certificate of title" for the property. A search of the register by any
subsequent lender will reveal the existence of the prior mortgage. See "--Nature
of Housing Loans as Security" below for a further description of Torrens title.
A mortgagee will retain the relevant certificate of title until the mortgage
is discharged. Although the certificate is not a document of title as such, the
procedure for replacement is sufficiently onerous to act as a deterrent against
most mortgagor fraud. In addition, failure to retain the certificate may in
certain circumstances constitute negligent conduct resulting in a postponement
of the mortgagee's priority to a later secured creditor.
Once the mortgagor has repaid the debt, a discharge is lodged with the
registrar and the mortgage is noted as having been released.
NATURE OF HOUSING LOANS AS SECURITY
There are a number of different forms of title to land in Australia. The
most common forms of title in Australia, and the only form of title which may
constitute Mortgaged Property is "Torrens title."
TORRENS TITLE
"Torrens title" land is freehold title, interests in which are created by
registration in a central land registry of the relevant State or Territory. Each
parcel of land is represented by a specific certificate of title. The original
certificate is retained by the registry, and in most States a duplicate
certificate is issued to the owner. Any dealing with the relevant land is
carried out by pro forma instruments which become effective on registration.
Ordinarily the relevant certificate of title (or any registered plan
referred to in it) will reveal the position and dimensions of the land, the
present owner, and any leases, mortgages and registered
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easements to which it is subject. The certificate is conclusive evidence (except
in limited circumstances, such as fraud) of the matters stated in it.
STRATA TITLE
"Strata title" was developed to facilitate the creation of, and dealings
with, apartment units (which are similar to condominiums in the United States)
and is governed by the legislation of the State or Territory in which the
property is situated. Under strata title, the relevant land is divided into the
relevant number of units. Each proprietor has title to, and may freely dispose
of, their unit. All proprietors are members of a "body corporate", which
monitors compliance with rules governing the apartment block. Certain parts of
the property, such as stairwells, entrance lobbies and the like are known as
"common property" and are owned by the body corporate as a whole rather than by
individual proprietors.
Only Torrens title land can be the subject of strata title in this way, and
so the provisions referred to in this section in relation to Torrens title apply
to the title in a unit held by a strata proprietor.
TAKING SECURITY OVER LAND
The law relating to the granting of securities over real property is made
complex by the fact that each State and Territory has separate governing
legislation. The following is a brief overview of general issues involved in
taking security over land.
Under Torrens title, registration of a mortgage using the prescribed form
executed by the mortgagor is required in order for the mortgagee to obtain the
remedies of a mortgagee granted by statute and the relevant priorities against
other secured creditors. To this extent the mortgagee is said to have a legal
(i.e., registered) title. However, registration does not transfer title in the
property--the mortgagor remains as legal owner. Rather, the Torrens mortgage
operates as a statutory charge. The mortgagee does not obtain an estate in the
property but does have an interest in the land which is marked on the register
and the "certificate of title" for the property. A search of the register by any
subsequent lender will reveal the existence of the prior mortgage.
In most States and Territories, a mortgagee will retain a duplicate
certificate of title (which mirrors the original certificate of title held at
the relevant land registry office). Although the certificate is not a document
of title as such, the procedure for replacement is sufficiently onerous to act
as a deterrent against most mortgagor fraud. Failure to retain the certificate
may in certain circumstances constitute negligent conduct resulting in a
postponement of the mortgagee's priority to a later secured creditor.
In Queensland, under the Land Title Act 1994, duplicate certificates of
title are no longer issued to mortgagees as a matter of practice. A record of
the title is stored on computer at the land registry office and the mortgage is
registered on that computerized title.
Once the mortgagor has repaid the debt, a discharge executed by the
mortgagee is lodged with the registrar by the mortgagor or the mortgagee and the
mortgage is noted as having been released.
WESTPAC AS MORTGAGEE
Westpac is, and until a Title Perfection Event occurs intends to remain, the
registered mortgagee of all the Mortgages. The relevant Borrowers will not be
aware of the equitable assignment of the Housing Loans and Mortgages to the
Issuer Trustee.
Prior to any Title Perfection Event Westpac, or the Servicer on its behalf,
will undertake any necessary enforcement action with respect to defaulted
Housing Loans and Mortgages. Following a Title Perfection Event, the Issuer
Trustee is entitled (under an irrevocable power of attorney granted to it by
Westpac) to be registered as mortgagee of the Mortgages. Until that registration
is achieved, the Issuer Trustee or the Trust Manager is entitled to lodge
caveats on the register to notify its interest publicly. See "APPENDIX
I--GLOSSARY OF AUSTRALIAN LEGAL TERMS."
ENFORCEMENT OF HOUSING LOANS
Subject to the discussion below, if a Borrower defaults under a Housing
Loan, the loan documents provide that all moneys under the loan may be declared
immediately due and payable. The lender may sue
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to recover all outstanding principal, interest and fees under the personal
covenant of the borrower contained in the loan documents to repay those amounts.
In addition, the lender may enforce a registered mortgage in relation to the
defaulted loan. Enforcement may occur in a number of ways, including the
following.
(a) The mortgagee may enter into possession of the property. If it does
so, it does so in its own right and not as agent of the mortgagor, and so
may be personally liable for mismanagement of the property and to third
parties as occupier of the property.
(b) The mortgagee may, in limited circumstances, lease the property to
third parties.
(c) The mortgagee may foreclose on the property--that is, extinguish the
mortgagor's title to the property so that the mortgagee becomes the absolute
owner of the property (a remedy that is, because of procedural constraints,
rarely used). If the mortgagee forecloses on the property, it loses the
right to sue the borrower under the personal covenant to repay and can look
only to the value of the property for satisfaction of the debt.
(d) The mortgagee may appoint a receiver to deal with income from the
property or exercise certain other rights delegated to the receiver by the
mortgagee. Unlike a mortgagee in possession, a receiver is the agent of the
mortgagor and so in theory the mortgagee is not liable for the receiver's
acts or as occupier of the property. In practice, the receiver will require
indemnities from the mortgagee that appoints it.
(e) The mortgagee may sell the property, subject to various duties to
ensure that the mortgagee exercises proper care in relation to the sale.
This power of sale is usually expressly contained in the mortgage documents,
and is also implied into registered mortgages under the relevant Torrens
title legislation. The Torrens title legislation prescribes forms and
periods of notice to be given to the mortgagor prior to enforcement.
A sale under a mortgage may be by public auction or private treaty. Once
registered, the purchaser of property sold pursuant to a mortgagee's power
of sale becomes absolute owner of the property.
A mortgagee's ability to call all amounts under a housing loan or enforce a
mortgage which is subject to the Consumer Credit Legislation is limited by
various demand and notice procedures which are required to be followed. For
example, as a general rule enforcement cannot occur unless the relevant default
is not remedied within 30 days after a default notice is given. Borrowers may
also be entitled to initiate negotiations with the mortgagee for a postponement
of enforcement proceedings.
PENALTIES AND PROHIBITED FEES
Australian courts will not enforce an obligation of a borrower to pay
default interest on delinquent required payments if the court determines that
the relevant default interest rate is a penalty. Certain jurisdictions prescribe
a maximum recoverable interest rate, although in most jurisdictions there is no
specified threshold rate to determine what is a penalty. In those circumstances,
whether a rate is a penalty or not will be determined by reference to such
factors as the prevailing market interest rates. The Consumer Credit Legislation
does not impose a limit on the rate of default interest, but a rate which is too
high may entitle the borrower to have the loan agreement re-opened on the ground
that it is unjust. Under the Corporations Law, the liquidator of a company may
avoid a loan under which an extortionate interest rate is levied.
The Consumer Credit Legislation requires that any fee or charge to be levied
by the lender must be provided for in the contract, otherwise it cannot be
levied. The regulations under the Consumer Credit Legislation may also from time
to time prohibit certain fees and charges. The Consumer Credit legislation also
requires that establishment fees, termination fees and prepayment fees must be
reasonable otherwise they may be reduced or set aside.
CONSUMER CREDIT LEGISLATION
Some of the Housing Loans are regulated by consumer credit legislation (the
"Consumer Credit Legislation"). Under that legislation, a Borrower may have a
right to apply to a court to:
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(1) vary the terms of his or her Housing Loan on the grounds of hardship
or that it is an unjust contract;
(2) reduce or cancel any interest rate payable on the Housing Loan which
is unconscionable;
(3) have certain provisions of the Housing Loan or relevant Mortgage
which are in breach of the legislation declared unenforceable; or
(4) obtain restitution or compensation from the Issuer Trustee, in
relation to any breaches of the Consumer Credit Legislation in relation to
the Housing Loan or relevant Mortgage.
Any such order may affect the timing or amount of interest or principal
payments or repayments under the relevant Housing Loan (which might in turn
affect the timing or amount of interest or principal payments or repayments
under the Offered Notes).
In addition, a mortgagee's ability to enforce a mortgage which is subject to
the Consumer Credit Legislation is limited by various demand and notice
procedures which are required to be followed. For example, as a general rule
enforcement cannot occur unless the relevant default is not remedied within 30
days after a default notice is given. Borrowers may also be entitled to initiate
negotiations with the mortgagee for a postponement of enforcement proceedings.
Such procedures and negotiations may also affect the timing or amount of
interest or principal payments or repayments under the Housing Loans.
Breaches of the Consumer Credit Legislation may also lead to civil penalties
or criminal fines being imposed on Westpac, for so long as it holds legal title
to the Housing Loans and the Mortgages. If the Issuer Trustee acquires legal
title, it will then become primarily responsible for compliance with the
Consumer Credit Legislation. The Issuer Trustee will (subject to limited
exceptions) be indemnified out of the assets of the Trust for its liabilities
under the Consumer Credit Legislation. If the Issuer Trustee is indemnified with
respect to such liabilities out of the assets of the Trust, proceeds of the
Trust may be insufficient to make all payments provided for under the Offered
Notes.
Westpac will give, or has given, certain representations and warranties that
the Housing Loans and related Mortgages comply in all material respects with the
Consumer Credit Legislation in force at the time documents were entered into.
The Servicer has undertaken to comply with the Consumer Credit Legislation in
connection with servicing the Housing Loans and related Mortgages where failure
to do so would have an Adverse Effect. An "Adverse Effect" is an event which
will materially and adversely affect the amount of any payment to be made to any
Noteholder, or will materially and adversely affect the timing of such payment.
In certain circumstances the Issuer Trustee may have the right to claim damages
from Westpac or the Servicer, as the case may be, where the Issuer Trustee
suffers loss in connection with a breach of the Consumer Credit Legislation
which is caused by a breach of a relevant representation or undertaking.
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BANKRUPTCY
The insolvency of a natural person is governed by the provisions of the
Bankruptcy Act 1966, which is a federal statute. Generally, secured creditors of
a natural person (such as mortgagees under real property mortgages) stand
outside the bankruptcy--that is, the property of the bankrupt which is available
for distribution by the trustee in bankruptcy does not include the secured
property. The secured creditor may, if it wishes, prove in the bankruptcy
proceeding as an unsecured creditor in a number of circumstances, including if
they have realized the related mortgaged property and their debt has not been
fully repaid (in which case they can prove for the unpaid balance).
Certain dispositions of property by a bankrupt may be avoided by the trustee
in bankruptcy. These include where (a) the disposition was made to defraud
creditors; or (b) the disposition was made by an insolvent debtor within 6
months of the petition for bankruptcy and gave a preference to an existing
creditor over at least one other creditor.
The insolvency of a company is governed by the Corporations Law of the
relevant Australian jurisdiction. Again, secured creditors generally stand
outside the insolvency. However, a liquidator may avoid a mortgage which is
voidable under the Corporations Law because it is an uncommercial transaction,
or an unfair preference to a creditor or a transaction for the purpose of
defeating creditors, and that transaction occurred when the company was
insolvent (or an act is done to give effect to the transaction when the company
is insolvent, or the company becomes insolvent because of the transaction or the
doing of an act to give effect to the transaction), and the transaction occurred
within a prescribed period prior to the commencement of the winding up of the
company. The liquidator may also avoid a loan under which an extortionate
interest rate is levied.
ENVIRONMENTAL
Real property which is mortgaged to a lender may be subject to unforeseen
environmental problems, including land contamination. Environmental legislation
which deals with liability for such problems exists at both state and federal
levels, although the majority of relevant legislation is imposed by the states.
No Australian statute expressly imposes liability on "passive" lenders or
security holders for environmental matters, and some states expressly exclude
such liability. However, liability in respect of environmentally damaged land
(which liability may include the cost of rectifying the damage) may attach to a
person who is, for instance, an owner, occupier or person in control of the
relevant property. In some but not all states, lenders are expressly excluded
from the definitions of one or more of these categories.
Merely holding security over property will not convert a lender into an
occupier. However, a lender or receiver who goes into possession of contaminated
mortgaged property or otherwise enforces its security may be liable as an
occupier.
Some environmental legislation provides that security interests may be
created over contaminated or other affected property to secure payment of the
costs of any necessary rectification of the property. The security interests may
have priority over pre-existing mortgages.
INSOLVENCY CONSIDERATIONS
The current transaction is designed to minimize insolvency risk. For
example, the equitable assignment of the Housing Loans by Westpac to the Issuer
Trustee should ensure that the Housing Loans are not assets available to the
liquidator or creditors of Westpac in the event of an insolvency of Westpac.
Similarly, the assets in the Trust should not be available to other creditors of
the Issuer Trustee in its personal capacity or as trustee of any other trust in
the event of an insolvency of the Issuer Trustee.
If any Insolvency Event occurs with respect to the Issuer Trustee, the
Security Trust Deed may be enforced by the Security Trustee at the direction of
the Voting Mortgagees (see "SECURITY FOR THE
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NOTES--Enforcement"). The security created by the Security Trust Deed will stand
outside any liquidation of the Issuer Trustee, and the assets the subject of
that security will not be available to the liquidator or any creditor of the
Issuer Trustee (other than a creditor which has the benefit of the Security
Trust Deed) in priority to the Security Trust Deed. The proceeds of enforcement
of the Security Trust Deed are to be applied by the Security Trustee as set out
in "SECURITY FOR THE NOTES--Priorities under the Security Trust Deed". If the
proceeds from enforcement of the Security Trust Deed are not sufficient to
redeem the Notes in full, some or all of the Noteholders will incur a loss.
TREATMENT OF INTEREST PAYMENTS WITH RESPECT TO AUSTRALIAN HOUSING LOANS
Under Australian law, interest on loans used to purchase a person's primary
place of residence is not ordinarily deductible for taxation purposes.
Conversely, interest payments on mortgage loans and other non-capital
expenditures relating to investment properties that generate taxable income are
generally allowable as tax deductions.
USE OF PROCEEDS
The net proceeds from the sale of the Offered Notes will amount to and
will be used by the Issuer Trustee to acquire equitable title to the Housing
Loans and related Mortgages from the Approved Sellers and for general expenses
(including any premium payable to any Swap Provider) in relation to the Trust.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following is a general discussion of the anticipated material United
States federal income tax consequences of the purchase, ownership and
disposition of Notes by Noteholders who are subject to United States federal
income tax. The summary is based on laws, regulations, rulings and decisions now
in effect, all of which are subject to change (possibly with retroactive effect)
or to different interpretation. The summary does not purport to address federal
income tax consequences applicable to particular categories of investors, some
of which (for example, insurance companies, dealers in securities, financial
institutions or foreign investors) may be subject to special rules. In addition,
this summary is generally limited to investors who will hold the Notes as
"capital assets" (generally, property held for investment) within the meaning of
Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code").
Investors are urged to consult their own tax advisors with regard to the
application of the tax considerations discussed below to their particular
situations, as well as the consequences to them under, state, local, non-United
States and any other tax law of the purchase, ownership and disposition of
Notes, including the advisability of making any election discussed below.
Prospective investors should note that no rulings have been or will be sought
from the Internal Revenue Service (the "IRS" or the "Service") with respect to
any of the federal income tax consequences discussed below, and no assurance can
be given that the IRS will not take contrary positions. It is anticipated that
the Issuer Trustee will not be indemnified for any United States federal income
taxes that may be imposed upon it, and the imposition of any such taxes on the
Trust could result in a reduction in the amounts available for distribution to
the Noteholders.
In the opinion of Mayer, Brown & Platt, tax counsel to the Issuer Trustee
("Tax Counsel"), for United States federal income tax purposes, the Notes will
be characterized as debt of the Issuer Trustee. Each Noteholder, by the
acceptance of a Note, will agree to treat the Notes as indebtedness for federal
income tax purposes.
GENERAL
Each Noteholder will be required to report on its federal income tax return
interest income on Notes held by it in accordance with such Noteholder's method
of accounting.
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SALES OF NOTES
A Noteholder's tax basis in a Note will equal its cost of such Note, reduced
by any amortized premium (as described below) and any payments other than
interest made on such Note and increased by any market discount or original
issue discount included in the Noteholder's income. A Noteholder that sells a
Note will recognize gain or loss (in the aggregate) in an amount equal to the
difference between its adjusted tax basis in the Note and the amount realized on
the sale (except to the extent attributable to accrued interest, which should be
taxable as interest income). Subject to the market discount provisions of the
Code (described below), any such gain or loss will be capital gain or loss if
the Note was held as a capital asset and, if the Note was held for more than one
year, will be long-term capital gain or loss. In the case of an individual
taxpayer, any capital gain on the sale of a Note will be taxed at a maximum rate
of 39.6% if the Note is held for not more than 12 months, at 28% if the Note is
held for more than 12 months, but not more than 18 months, and at 20% if the
Note is held for more than 18 months. Any capital losses realized will be
deductible by a corporate taxpayer only to the extent of capital gains and by an
individual taxpayer only to the extent of capital gains plus U.S. $3,000 of
other income.
MARKET DISCOUNT
A purchaser of a Note will be considered to have acquired such Note at a
"market discount" to the extent the remaining principal amount of such Note
exceeds the Noteholder's tax basis in such Note, unless the excess does not
exceed a prescribed DE MINIMIS amount. In the event such excess exceeds the de
minimis amount, the Noteholder will be subject to the market discount rules of
Sections 1276 and 1278 of the Code with regard to such Note.
In the case of a sale or other disposition of a Note subject to the market
discount rules, Section 1276 of the Code requires that gain, if any, from such
sale or disposition be treated as ordinary income to the extent such gain
represents market discount that has accrued during the period in which the Note
was held by such Noteholder. In addition, a disposition of a Note by gift (and
in certain other circumstances), could result in the recognition of market
discount income, computed as if such Note had been sold for its fair market
value.
In the case of a partial principal payment on a Note subject to the market
discount rules, Section 1276 of the Code requires that such payment be included
in gross income as ordinary income to the extent such payment does not exceed
the market discount that has accrued during the period such Note was held by
such Noteholder. The amount of any accrued market discount later required to be
included in income upon a disposition, or subsequent partial principal payment,
will be reduced by the amount of accrued market discount previously included in
income.
Generally, market discount accrues under a straight line method, or, at the
election of the taxpayer, under a constant interest rate method. However, in the
case of bonds the principal of which may be paid in two or more installments
(such as the Notes), the manner in which market discount is to be accrued will
be described in Treasury regulations that have yet to be issued. Until such
Treasury regulations are issued, the explanatory conference committee Report to
the Tax Reform Act of 1986 (the "Conference Report") indicates that holders of
such obligations may elect to accrue market discount either on the basis of a
constant interest rate or as follows: (1) for those obligations that have
original issue discount ("OID"), market discount shall be deemed to accrue in
proportion to the accrual of OID for any accrual period, and (2) for those
obligations which do not have OID, the amount of market discount that is deemed
to accrue is the amount of market discount that bears the same ratio to the
total amount of remaining market discount that the amount of stated interest
paid in the accrual period bears to the total amount of stated interest
remaining to be paid on the obligation as of the beginning of such period.
Under Section 1277 of the Code, if in any taxable year interest paid or
accrued by a Noteholder on indebtedness incurred or continued to purchase or
carry a Note subject to the market discount rules exceeds the interest
(including OID) currently includible in income with respect to such Note,
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deductions of such interest must be deferred to extent of the market discount
allocable to the taxable year. The deferred portion of any interest expense will
generally be deductible when such market discount is included in income upon the
sale or other disposition (including repayment) of the indebtedness.
Section 1278 of the Code allows a taxpayer to make an election to include
market discount in its gross income currently. If such election is made, the
rules of Sections 1276 and 1277 of the Code (described above) will not apply to
the taxpayer.
Due to the complexity of the market discount rules, prospective Noteholders
are urged to consult their tax advisors as to the applicability and operation of
the market discount rules.
PREMIUM
A Noteholder will generally be considered to have acquired a Note at a
premium to the extent the Noteholder's tax basis in such Note exceeds the
remaining principal amount of such Note. In that event, a Noteholder who holds a
Note as a capital asset may amortize the premium as an offset to interest income
under Section 171 of the Code, with corresponding reductions in the Noteholder's
tax basis in the Note if an election under Section 171 of the Code is or has
been made with respect to all debt instruments held by the taxpayer (including
the Notes). Generally, such amortization is on a constant yield basis. However,
in the case of bonds the principal of which may be paid in two or more
installments (such as the Notes), the Conference Report indicates a
Congressional intent that amortization will be in accordance with the same rules
that will apply to the accrual of market discount on such obligations (see the
discussion of market discount above).
BACKUP WITHHOLDING
A Noteholder may be subject, under certain circumstances, to backup
withholding at a 31% rate with respect to "reportable payments" on the
Securities. This withholding generally applies only if the Noteholder (i) fails
to provide the Noteholder's social security or other taxpayer identification
number ("TIN"); (ii) furnishes an incorrect TIN; (iii) is notified by the
Service that the Noteholder has failed to report properly payments of interest
and dividends and the Service has notified the Issuer Trustee that the
Noteholder is subject to backup withholding; or (iv) fails, under certain
circumstances, to provide a certified statement, signed under penalty of
perjury, that the TIN provided is the Noteholder's correct number and that the
Noteholder is not subject to backup withholding. Any amount withheld from
payment to a Noteholder under the backup withholding rules is allowable as a
credit against such Noteholder's federal income tax liability, provided that the
required information is furnished to the Service. Certain Noteholders
(including, among others, corporations and foreign individuals who comply with
certain certification requirements) are not subject to backup withholding.
Noteholders should consult their tax advisors as to their qualifications for
exemption from backup withholding and the procedure for obtaining such an
exemption.
ALL INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE FEDERAL,
STATE, LOCAL OR FOREIGN INCOME TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE NOTES.
CERTAIN AUSTRALIAN TAX MATTERS
THE FOLLOWING STATEMENTS WITH RESPECT TO AUSTRALIAN TAXATION ARE ONLY
GENERAL SUMMARIES AND ARE BASED ON ADVICE RECEIVED BY THE ISSUER TRUSTEE.
PURCHASERS OF OFFERED NOTES SHOULD CONSULT THEIR OWN TAX ADVISERS CONCERNING THE
CONSEQUENCES, IN THEIR PARTICULAR CIRCUMSTANCES, UNDER AUSTRALIAN TAX LAWS, AND
THE LAWS OF ANY OTHER TAXING JURISDICTION, OF THE OWNERSHIP OF OR ANY DEALING IN
THE NOTES. ANY SUCH DEALING WOULD NEED TO COMPLY WITH THE SELLING RESTRICTIONS
AND SECURITIES LAW GENERALLY.
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PAYMENTS OF PRINCIPAL, PREMIUMS AND INTEREST
Under existing Australian tax law, non-resident holders of Notes or
interests in any Global Note (other than persons holding such securities or
interest as part of a business carried on, at or through a permanent
establishment in Australia (an "Australian Establishment")) are not subject to
Australian income tax on payments of interest or amounts in the nature of
interest, other than interest withholding tax. Under Article 11 of the 1983
United States-Australia Tax Convention, the maximum Australian withholding rate
on interest paid to United States recipients is 10%. Under Australian law, the
withholding rates for payments to other jurisdictions is currently 10% on
interest or amounts in the nature of interest paid on the Notes. A premium on
redemption would generally be treated as an amount in the nature of interest for
this purpose.
Pursuant to section 128F of the Australian Income Tax Assessment Act 1936
(the "Tax Act"), an exemption from Australian interest withholding tax applies
provided all prescribed conditions are met. Such conditions include the issue of
the Offered Notes in a way that satisfies an objective public offer test. The
Issuer Trustee will seek to issue the Offered Notes in a way that will satisfy
such test and otherwise meet the requirements of section 128F including by
listing the Offered Notes.
The test will not be satisfied if the Issuer Trustee knew, or had reasonable
grounds to suspect, that the Offered Notes were being or would later be acquired
either directly or indirectly by:
(1) a resident of Australia for the purpose of section 128F of the Tax Act;
or
(2) an associate of the Issuer Trustee within the meaning of section 128F of
the Tax Act, other than in the capacity of a dealer, manager or
underwriter in relation to the placement of an Offered Note.
The exemption from Australian withholding tax will also not apply to
interest paid by the Issuer Trustee to an associate of the Issuer Trustee within
the meaning of section 128F if, at the time of the payment, the Issuer Trustee
knows, or has reasonable grounds to suspect, that the person is an associate.
In a press release of the Federal Government of Australia late last year
entitled Investing for Growth, it was announced that "in order to encourage the
deepening and greater liquidity of the domestic corporate debt market, the
interest withholding tax exemption provided under section 128F of the Income Tax
Assessment Act 1936 will be widened by removing, for eligible debentures issued
by companies, the present requirement that such debentures be issued outside
Australia and that the interest be paid outside Australia...this measure will
remove tax discrimination in favor corporate debt issued and foreign financial
markets over corporate debt issued in Australia markets."
This amendment has not yet been enacted, therefore the effect, form and
timing of the proposed amendments are currently unclear.
PROFIT ON SALE
Under existing Australian law, non-resident holders of Offered Notes will
not be subject to Australian income tax on profits derived from the sale or
disposal of the Offered Notes provided that:
(1) the Offered Notes are not held as part of an Australian Establishment;
and
(2) the profits do not have an Australian source.
The source of any profit on the disposal of Offered Notes will depend on the
factual circumstances of the actual disposal. Where the Offered Notes are
acquired and disposed of pursuant to contractual arrangements entered into and
concluded outside Australia, and the seller and the purchaser are non-residents
of Australia and do not have an Australian Establishment, the profit should not
have an Australian source. There are, however, specific withholding tax rules
that can apply to treat a portion of the sale price of Notes as interest for
withholding tax purposes (and which amounts are not covered by the exemption
conditions in section 128F). These rules can apply when:
(1) Offered Notes are sold for an amount in excess of their issue price
prior to maturity; or
(2) Offered Notes are sold to an Australian resident in connection with a
"washing arrangement" (as defined in the Tax Act).
144
<PAGE>
OTHER TAXES
No stamp, issue, registration or similar taxes are payable in Australia in
connection with the issue of the Offered Notes. Furthermore, a transfer of, or
agreement to transfer, Offered Notes executed outside of Australia will not be
subject to Australian stamp duty.
ERISA CONSIDERATIONS
Subject to the considerations discussed below, the Offered Notes are
eligible for purchase by employee benefit plans.
Section 406 of the Employee Retirement Income Security Act ("ERISA"), and/or
Section 4975 of the Code, prohibits a pension, profit-sharing or other employee
benefit plan, as well as individual retirement accounts and certain types of
Keogh Plans (each a "Benefit Plan") from engaging in certain transactions with
persons that are "parties in interest" under ERISA or "disqualified persons"
under the Code with respect to such Benefit Plan. A violation of these
"prohibited transaction" rules may result in an excise tax or other penalties
and liabilities under ERISA and the Code for such persons. Title I of ERISA also
requires that fiduciaries of a Benefit Plan subject to ERISA make investments
that are prudent, diversified (except if prudent not to do so) and in accordance
with governing plan documents.
Certain transactions involving the purchase, holding or transfer of the
Notes might be deemed to constitute prohibited transactions under ERISA and the
Code if assets of the Issuer Trustee were deemed to be assets of a Benefit Plan.
Under a regulation issued by the United States Department of Labor (the "Plan
Assets Regulation"), the assets of the Issuer Trustee would be treated as plan
assets of a Benefit Plan for the purposes of ERISA and the Code only if the
Benefit Plan acquires an "equity interest" in the Issuer Trustee and none of the
exceptions contained in the Plan Assets Regulation is applicable. An equity
interest is defined under the Plan Assets Regulation as an interest in an entity
other than an instrument which is treated as indebtedness under applicable local
law and which has no substantial equity features. Although there can be no
assurances in this regard, it appears that the Notes should be treated as debt
without substantial equity features for purposes of the Plan Assets Regulation
and that the Notes do not constitute equity interests in the Issuer Trustee for
purposes of the Plan Assets Regulation. However, without regard to whether the
Notes are treated as an equity interest for such purposes, the acquisition or
holding of Notes by or on behalf of a Benefit Plan could be considered to give
rise to a prohibited transaction if the Issuer Trustee, or any of their
respective affiliates is or becomes a party in interest or a disqualified person
with respect to such Benefit Plan. In such case, certain exemptions from the
prohibited transaction rules could be applicable depending on the type and
circumstances of the plan fiduciary making the decision to acquire a Note.
Included among these exemptions are: Prohibited Transaction Class Exemption
("PTCE") 96-23, regarding transactions effected by "in-house asset managers";
PTCE 90-1, regarding investments by insurance company pooled separate accounts;
PTCE 95-60, regarding transactions effected by "insurance company general
accounts"; PTCE 91-38, regarding investments by bank collective investment
funds; and PTCE 84-14, regarding transactions effected by "qualified
professional asset managers." By its acquisition of a Note, each purchaser shall
be deemed to represent and warrant that its purchase and holding of the Note
will not result in a non-exempt prohibited transaction under ERISA or the Code.
Employee benefit plans that are governmental plans (as defined in Section
3(32) of ERISA) and certain church plans (as defined in Section 3(33) of ERISA)
are not subject to ERISA requirements.
A PLAN FIDUCIARY CONSIDERING THE PURCHASE OF ANY OF THE NOTES SHOULD CONSULT
ITS TAX AND/OR LEGAL ADVISORS REGARDING WHETHER THE ASSETS OF THE ISSUER TRUSTEE
WOULD BE CONSIDERED PLAN ASSETS, THE POSSIBILITY OF EXEMPTIVE RELIEF FROM THE
PROHIBITED TRANSACTION RULES AND OTHER ISSUES AND THEIR POTENTIAL CONSEQUENCES.
145
<PAGE>
RATINGS OF THE NOTES
It is a condition to the issuance of the Class A Notes that they be rated
"AAA" by Standard & Poor's Ratings Group, a division of The McGraw-Hill
Companies ("Standard & Poor's"), "Aaa" by Moody's Investors Service, Inc.
("Moody's") and "AAA" by Fitch IBCA, Inc. ("Fitch" and together with Standard &
Poor's, the "Rating Agencies"). It is a condition to the issuance of the Class B
Notes that they be rated "AA-" by Standard & Poor's and "AA-" by Fitch. The
security ratings of the Offered Notes should be evaluated independently from
similar ratings on other types of securities. A security rating is not a
recommendation to buy, sell or hold securities and may be subject to revision or
withdrawal at any time by the Rating Agencies.
LEGAL INVESTMENT CONSIDERATIONS
The Offered Notes will not constitute "mortgage related securities" for
purposes of the Secondary Mortgage Market Enhancement Act of 1984 ("SMMEA"),
because the originator of the Mortgage Loans was not subject to United States
State of Federal regulatory authority. Accordingly, many institutions with legal
authority to invest in comparably rated securities based on such mortgage loans
may not be legally authorized to invest in the Offered Notes, which, for the
reasons stated herein, do not constitute "mortgage related securities" under
SMMEA. No representation is made as to whether the Offered Notes constitute
legal investments under any applicable statute, law, rule, regulation or order
for any entity whose investment activities are subject to investment laws and
regulations or to review by certain regulatory authorities. Prospective
purchasers are urged to consult with their counsel concerning the status of the
Offered Notes as legal investments for such purchasers.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
by and among the underwriters named below (the "Underwriters"), Westpac, the
Issuer Trustee and Trust Manager, the Issuer Trustee has agreed to sell to the
Underwriters, and each of the Underwriters have severally agreed to purchase,
the principal amount of Notes set forth opposite its name below.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT
UNDERWRITER OF CLASS A NOTES OF CLASS B NOTES
- ----------------------------------------------------------------------------- ---------------- ----------------
<S> <C> <C>
J.P. Morgan Securities Inc...................................................
Morgan, Stanley & Co. Incorporated...........................................
Other Underwriters...........................................................
---------------- ----------------
Total.................................................................. US$ US$
---------------- ----------------
---------------- ----------------
</TABLE>
The Underwriters have entered into the Underwriting Agreement with the
Issuer Trustee.
In the Underwriting Agreement, the Underwriters named therein have agreed,
subject to the terms and conditions set forth therein, to purchase all of the
Offered Notes offered hereby if any Offered Notes are purchased. In the event of
default by an Underwriter, the Underwriting Agreement provides that, in certain
circumstances, the Underwriting Agreement may be terminated.
The Issuer Trustee has been advised by the Underwriters that they propose
initially to offer the Offered Notes to the public at the respective offering
prices set forth on the cover page hereof and to certain dealers at such prices
less concessions not to exceed % of the Class A Principal Balance and % of
the Class B Principal Balance.
With respect to the Class A Notes, the Underwriters may allow and such
dealers may reallow, a concession not to exceed % of the aggregate of the
Class A Principal Balance. With respect to the Class B Notes, the Underwriters
may allow and such dealers may reallow, a concession not to exceed % of the
Class B Principal Balance.
146
<PAGE>
In connection with the offering, the Underwriters may engage in transactions
that stabilize, maintain or otherwise affect the price of the Securities.
Specifically, the Underwriters may overallot the offering, creating a syndicate
short position. In addition, the Underwriters may bid for, and purchase, the
Securities in the open market to cover syndicate shorts or to stabilize the
price of the Securities. Any of these activities may stabilize or maintain the
market price of the Securities above independent market levels. The Underwriters
are not required to engage in these activities, and if commenced, such
activities may be discontinued at any time.
After the initial public offering of the Offered Notes, the public offering
price and such concessions may be changed.
Pursuant to the Underwriting Agreement, Westpac Securities Administration
Limited (in its capacity as trustee of the Trust only), Westpac Banking
Corporation and Westpac Securitisation Management Pty Limited have agreed to
indemnify the Underwriters against certain liabilities, including civil
liabilities under the Securities Act, or contribute to payments which the
Underwriters may require to make in respect thereof.
In the ordinary course of [its][their] business, [J.P. Morgan Securities
Inc.][the Underwriters] and certain of [its][their] affiliates have in the past
and may in the future engage in commercial and investment banking activities
with Westpac and its affiliates.
LISTING AND GENERAL INFORMATION FOR NON-U.S. INVESTORS
LISTING
The listing of the Notes on the London Stock Exchange will be expressed as a
percentage of their principal amount (exclusive of accrued interest). It is
expected that listing of the Offered Notes on the London Stock Exchange will be
granted on , subject to the issuance of Global Notes. The Offered
Notes will be issued in the form of one or more Global Notes. There will be no
temporary global notes.
AUTHORIZATION
The Issuer Trustee has obtained all necessary consents, approvals and
authorizations in connection with the issue and performance of the Notes. The
issue of the Notes has been authorized by the resolutions of the Board of
Directors of the Issuer Trustee passed on .
LITIGATION
The Issuer Trustee is not involved in any litigation or arbitration
proceedings which may have, or have had during the twelve months preceding the
date of this Prospectus, a significant effect on the Issuer Trustee's financial
position nor, so far as the Issuer Trustee is aware, are any such litigation or
arbitration proceedings pending or threatened.
EUROCLEAR AND CEDEL
The Offered Notes have been accepted for clearance through Euroclear and
Cedel Bank with a common code of for the Class A Notes and a common code
of for the Class B Notes. The ISIN for the Class A Notes is and the
ISIN for the Class B Notes is .
DOCUMENTS AVAILABLE FOR COLLECTION AND INSPECTION
Copies of the following documents may be inspected during normal business
hours on any weekday (excluding Saturdays, Sundays and public holidays) at the
offices of the Note Trustee at 60 Victoria
147
<PAGE>
Embankment, London ECHY 0UP, [during the period of fourteen days from the date
of this Prospectus] (except for (a), together the "Transaction Documents"):
(a) the Memorandum and Articles of Association of the Issuer Trustee;
(b) the Master Trust Deed between the Issuer Trustee and the Trust Manager
dated 14th February 1997; (c) the following (which, prior to the Closing Date,
will be in draft form):
(i) the Series Notice among the Issuer Trustee, the Trust Manager, the
Approved Seller, the Note Trustee and the Servicer dated , 1998;
(ii) the Servicing Agreement and the Servicing Agreement Amendment
Agreement among Westpac, the Servicer and the Trustee dated 18th February
1998;
(iii) the Note Trust Deed among the Issuer Trustee, the Trust Manager and
the Note Trustee dated , 1998;
(iv) the Agency Agreement among the Issuer Trustee, the Trust Manager,
the Note Trustee, the Principal Paying Agent and the Agent Bank dated
, 1998;
(v) the Security Trust Deed among the Issuer Trustee, the Security
Trustee, the Note Trustee and the Trust Manager dated , 1998;
(vi) the Liquidity Facility Agreement among the Issuer Trustee, the
Liquidity Provider and the Trust Manager dated , 1998;
(vii) the Redraw Facility Agreement among the Issuer Trustee, the Redraw
Facility Provider and the Trust Manager dated , 1998;
(viii) the Variable Rate Basis Swap between the Issuer Trustee and Westpac
dated , 1998;
(ix) the Fixed Rate Basis Swaps between the Issuer Trustee and Westpac
dated , 1998;
(x) the Currency Swap among the Currency Swap Providers, the Issuer
Trustee and the Trust Manager dated , 1998;
(xi) the Mortgage Pool Insurance Policy between HLIC, Westpac and the
Issuer Trustee;
(xii) the PMI Policies issued by SunAlliance, MGICA, WLMI and HLIC which
cover individual loans for principal and interest losses; and
(xiii) Underwriting Agreement among the Trust Manager, the Issuer Trustee,
Westpac and the Underwriters dated ____________, 1998.
TEMPORARY AUSTRALIAN FOREIGN EXCHANGE CONTROLS
Under temporary Australian foreign exchange controls, payments to, or on
behalf of:
(1) the Government of Iraq or to its agencies or nationals:
(2) the authorities of the Federal Republic of Yugoslavia (Serbia and
Montenegro); or
(3) the Government of Libya or any public authority or controlled entity of
the Government of Libya,
may only be made with the approval of the Reserve Bank of Australia.
Mayer, Brown & Platt have given and not withdrawn their written consent to
the inclusion in this Prospectus of their opinion in the form and context in
which it is included on page __ and have authorized the content of their opinion
for the purposes of section 152(1)(e) of the Financial Services Act 1986.
148
<PAGE>
Allen Allen & Hemsley have given and not withdrawn their written consent to
the inclusion in the Prospectus of their opinion in the form and context in
which it is included on page __ and have authorized the content of their opinion
for the purposes of section 152(1)(e) of the Financial Services Act 1986.
LEGAL MATTERS
Certain legal matters with respect to the Offered Notes will be passed upon
for the Trust and the Issuer Trustee by Mayer, Brown & Platt, Chicago, Illinois,
and Allen Allen & Hemsley, Sydney, Australia and for the Underwriters by Brown &
Wood LLP, New York, New York. The material U.S. federal income tax consequences
of the Offered Notes will be passed upon for the Trust and the Issuer Trustee by
Mayer, Brown & Platt, and certain Australian income tax consequences will be
passed upon for the Trust and Issuer Trustee by Allen Allen & Hemsley.
149
<PAGE>
INDEX OF DEFINED TERMS
<TABLE>
<S> <C>
Agent Bank...................................................................... 18
A$ Class A Interest Amount...................................................... 91
A$ Class B Interest Amount...................................................... 91
A$ Equivalent................................................................... 89
Accrued Interest Adjustment..................................................... 32, 49
ACN............................................................................. 60
ACT............................................................................. 54
Additional Termination Event.................................................... 133
Adverse Effect.................................................................. 43, 140
Agreement....................................................................... 133
AMP............................................................................. 83
Approved Bank................................................................... 88
Approved Sellers................................................................ 15
Australian Establishment........................................................ 145
Authorized Investments.......................................................... 109
Availability Fee................................................................ 103
Available Income................................................................ 31, 88
Available Liquidity Amount...................................................... 129
Available Redraw Amount......................................................... 102
Average Quarterly Percentage.................................................... 98
Bank Bill Rate.................................................................. 102
Basic Terms Modification........................................................ 116, 117
beneficial owner................................................................ 111
Beneficiary..................................................................... 94
Benefit Plan.................................................................... 146
body corporate.................................................................. 137
Book-Entry Notes................................................................ 87, 111
Borrower........................................................................ 23
Business Day.................................................................... 18, 86
capital assets.................................................................. 142
Carryover Charge Off............................................................ 32
Carryover Class A Charge Offs................................................... 100
Carryover Class B Charge Offs................................................... 100
Carryover Redraw Charge Offs.................................................... 100
Carryover RFS Class A Charge Offs............................................... 100
CBA............................................................................. 65
Cede............................................................................ 3
Cedel........................................................................... 1
Cedel Participants.............................................................. 113
Certificate of Insurance........................................................ 78
charge.......................................................................... 26
Chargor......................................................................... 26, 46
Class........................................................................... 18
Class A Charge Off.............................................................. 99
Class A Forex Percentage........................................................ 98
Class A Notes................................................................... 1, 16, 86
Class A Percentage.............................................................. 98
Class B Charge Off.............................................................. 99
</TABLE>
150
<PAGE>
<TABLE>
<S> <C>
Class B Notes................................................................... 1, 16, 86
Class B Percentage.............................................................. 98
Clean-up Offer.................................................................. 27
Closing Date.................................................................... 17
Code............................................................................ 142
Collateral Account.............................................................. 130
Collection Account.............................................................. 109
Collection Determination Date................................................... 87
Collection Period............................................................... 87
31, 88,
Collections..................................................................... 133
Collections Account............................................................. 24
Commission...................................................................... 3
common property................................................................. 138
Concessional Fixed Rate......................................................... 38
Conference Report............................................................... 143
Consumer Credit Legislation..................................................... 42, 140
Cooperative..................................................................... 113
CPR............................................................................. 84
Currency Swap................................................................... 133
Currency Swap Providers......................................................... 133
Cut-Off Date.................................................................... 17
Cut-Off Date Balance Outstanding................................................ 23, 51
Cut-Off Date Pool Balance....................................................... 54
Definitive Note................................................................. 111
Definitive Notes................................................................ 114
25, 66,
Delinquent...................................................................... 129
Depository...................................................................... 87
Draw Fee........................................................................ 102
DTC............................................................................. 1, 111
Eligibility Criteria............................................................ 52
Eligible Servicer............................................................... 40
equity interest................................................................. 146
ERISA........................................................................... 146
Euroclear....................................................................... 1
Euroclear Operator.............................................................. 113
Euroclear Participants.......................................................... 113
European Depositaries........................................................... 111
Event of Default................................................................ 118
Excess Available Income......................................................... 33, 93
Excess Collections Distribution................................................. 33, 94
Exchange Act.................................................................... 3
Fair Market Value............................................................... 27
Finance Charge Collections...................................................... 89
Finance Charge Loss............................................................. 90
Financial Intermediary.......................................................... 111
Fitch........................................................................... 29, 147
Fixed Rate...................................................................... 38
Fixed Rate Housing Loans........................................................ 54
floating charge................................................................. 26
GE.............................................................................. 81
GECA............................................................................ 81
</TABLE>
151
<PAGE>
<TABLE>
<S> <C>
Government...................................................................... 81
Gross Principal Collections..................................................... 31, 94
HLIC............................................................................ 21, 77
Holders......................................................................... 86
Housing Loan Principal.......................................................... 98
Housing Loans................................................................... 1
Initial Invested Amount......................................................... 18
Initial Principal Distributions................................................. 96
Initial Subordinated Percentage................................................. 99
Insolvency Event................................................................ 103
19, 93,
Interest........................................................................ 106
Interest Determination Date..................................................... 18, 87, 93
Interest Period................................................................. 18
Interest Rate................................................................... 18, 93
Interest Rate Swap Provider..................................................... 132
Invested Amount................................................................. 18, 32
IRS............................................................................. 142
ISDA............................................................................ 18, 93
ISDA Definitions................................................................ 19, 93
ISDA Master Agreement........................................................... 26
Issuer Trustee.................................................................. 1, 15, 60
Issuer Trustee Fee.............................................................. 63
Issuer Trustee's Default........................................................ 63
J.P. Morgan..................................................................... 136
Liquidation Loss................................................................ 32
Liquidation Losses.............................................................. 90
Liquidation Proceeds............................................................ 90
Liquidity Draw.................................................................. 129
Liquidity Facility Provider..................................................... 25
Liquidity Limit................................................................. 25, 129
Liquidity Shortfall............................................................. 129
LMI............................................................................. 81
London Stock Exchange........................................................... 1
Loss Date....................................................................... 79
LVR............................................................................. 21
Margin.......................................................................... 105
market discount................................................................. 143
Master Trust Deed............................................................... 15
Maturity Date................................................................... 17
MGICA........................................................................... 22, 77
MIP............................................................................. 67
Moody's......................................................................... 29, 147
Mortgage Default................................................................ 79
Mortgage in Possession.......................................................... 67
Mortgage Insurance Policies..................................................... 21
Mortgage Insurers............................................................... 22
Mortgage Pool................................................................... 23
Mortgage Pool Insurance Policy.................................................. 21, 77
Mortgage Rates.................................................................. 23
Mortgage Servicing System....................................................... 24
Mortgage Shortfall.............................................................. 32, 99
</TABLE>
152
<PAGE>
<TABLE>
<S> <C>
Mortgaged Property.............................................................. 23
Mortgagees...................................................................... 26, 46
Mortgages....................................................................... 51
MPC............................................................................. 66
Net Principal Collections....................................................... 20, 96
Note Owners..................................................................... 111
Note Trust Deed................................................................. 15
Note Trustee.................................................................... 15
Noteholder...................................................................... 111
Noteholders..................................................................... 86
Notes........................................................................... 17, 86
Notice of Creation of Trust..................................................... 45
NSW............................................................................. 54
NT.............................................................................. 54
Offered Noteholders............................................................. 18
Offered Notes................................................................... 1, 13, 86
OID............................................................................. 143
P & I........................................................................... 76
Paying Agent.................................................................... 16
Paying Agents................................................................... 16
Payment Date.................................................................... 1, 18
payment holiday................................................................. 75
Payment Model................................................................... 84
Payment Shortfall............................................................... 24, 90
Performing Loan................................................................. 25, 129
Plan Assets Regulation.......................................................... 146
PMI Policy...................................................................... 21, 82
Prepayment Benefit.............................................................. 90
Prepayment Benefit Shortfall.................................................... 90
Prepayment Calculation Adjustment............................................... 95
Prepayment Cost................................................................. 90
Prepayment Cost Surplus......................................................... 90
Principal Charge Off............................................................ 32, 99
Principal Collections........................................................... 31, 95
Principal Draw.................................................................. 24, 33, 90
Principal Loss.................................................................. 28, 90
Principal Outstanding........................................................... 102
Principal Paying Agent.......................................................... 16
Procedures Manual............................................................... 123
PTCE............................................................................ 146
QLD............................................................................. 54
Quarter......................................................................... 86
Quarterly Percentage............................................................ 98
Rating Agencies................................................................. 29, 147
Record Date..................................................................... 18
37, 75,
Redraw.......................................................................... 101
redraws......................................................................... 17
Redraw Advance.................................................................. 102
Redraw Facility Agreement....................................................... 27, 101
Redraw Facility Charge Off...................................................... 100
Redraw Facility Provider........................................................ 20, 101
</TABLE>
153
<PAGE>
<TABLE>
<S> <C>
Redraw Funding Securities....................................................... 17
Redraw Limit.................................................................... 102
Redraw Shortfall................................................................ 101
Registered...................................................................... 23
Registration Statement.......................................................... 6
Related Security................................................................ 51
relevant corporation............................................................ 103
Relevant Date................................................................... 107
Relevant Depositary............................................................. 111
Relevant Document............................................................... 51
Remaining Liquidity Shortfall................................................... 90
Remittance Date................................................................. 88
Replacement Currency Swap....................................................... 135
reportable payments............................................................. 144
RFS............................................................................. 105
RFS Charge Off.................................................................. 99
RFS Class A Charge Off.......................................................... 99
RFS Class A Forex Percentage.................................................... 99
RFS Class A Interest............................................................ 91
RFS Class A Note................................................................ 105
RFS Class A Notes............................................................... 2, 17
RFS Interest.................................................................... 91
RFS Series...................................................................... 105
RFSs............................................................................ 2, 17
RSALMI.......................................................................... 83
Rules........................................................................... 112
SA.............................................................................. 54
Sale Notice..................................................................... 15
Scheduled Payment............................................................... 23
Secured Moneys.................................................................. 47
Securities Act.................................................................. 6
Securitized Portfolios.......................................................... 67
Security Trustee................................................................ 15, 46
Security Trust Deed............................................................. 15
Security Trustee Fee............................................................ 49
Seller Trustee.................................................................. 16, 45
Serial Method 1 Distribution Test............................................... 96
Serial Method 2 Distribution Test............................................... 97
Series Notice................................................................... 25
Service......................................................................... 142
Servicer........................................................................ 5, 15, 51
Servicer Transfer Event......................................................... 126
Servicer's Security Undertaking................................................. 36
Servicing Agreement............................................................. 15
Servicing Fee................................................................... 126
SMMEA........................................................................... 28, 147
Standard & Poor's............................................................... 29, 147
Stated Amount................................................................... 19, 32
Strata title.................................................................... 137
Subordinated Percentage......................................................... 99
Substitution Net Transfer Amount................................................ 89, 95
</TABLE>
154
<PAGE>
<TABLE>
<S> <C>
SunAlliance..................................................................... 22, 77
Support Facility................................................................ 26
Swap Agreements................................................................. 26
Swap Providers.................................................................. 133
TAS............................................................................. 54
Tax Act......................................................................... 145
Tax Counsel..................................................................... 142
Term............................................................................ 128
Termination Date................................................................ 104
Terms and Conditions............................................................ 113
Threshold Rate.................................................................. 38, 133
TIN............................................................................. 144
Title Perfection Event.......................................................... 35
TMC............................................................................. 15
top up.......................................................................... 37
top ups......................................................................... 76
Torrens title................................................................... 137
Total Available Funds........................................................... 88
Total Carryover Charge Off...................................................... 100
Total Payments.................................................................. 33, 92
Transaction Documents........................................................... 26
Transfer Agent and Registrar.................................................... 115
Trust........................................................................... 1, 15, 25
Trust Accounts.................................................................. 109
Trust Assets.................................................................... 1
Trust Expenses.................................................................. 92
Trust Manager................................................................... 2, 15, 70
Trust Manager Fee............................................................... 71
Trust Manager's Default......................................................... 71
Underwriters.................................................................... 148
Unpaid Balance.................................................................. 107
US$ Account..................................................................... 100
USD-LIBOR-BBA................................................................... 93
USD-LIBOR-Reference Banks....................................................... 19, 93
Variable Rate Housing Loans..................................................... 54
Vic............................................................................. 54
Voting Mortgagee................................................................ 120
WA.............................................................................. 54
weighted average life........................................................... 84
Westpac......................................................................... 1, 15, 65
Westpac Group................................................................... 44
WLMI............................................................................ 22, 77
WSML............................................................................ 70
</TABLE>
155
<PAGE>
A1-I
APPENDIX I--GLOSSARY OF AUSTRALIAN LEGAL TERMS
"CHARGE" means the charge created by the Security Trust Deed. A Charge is a
proprietary interest created over property.
"CHARGOR" means the person or entity granting a Charge.
MORTGAGEE IN POSSESSION ("MIP") means a mortgagee in possession of the
related Mortgaged Property who, following an enforcement of the relevant
mortgage, is able to deal with the Mortgaged Property without becoming the
absolute owner of the Mortgaged Property.
"REGISTERED" means the mortgage has been filed with lands office in the
relevant Australian State or Territory, granting certain rights with respect to
the applicable Mortgaged Property.
"SECURED MONEYS" means all money which the Issuer Trustee (whether alone or
with another person) is or at any time may become actually or contingently
liable to pay to or for the account of any Mortgagee (whether alone or with
another person) for any reason whatever under or in connection with a Trust
Document.
"STRATA TITLE" means a system of title in which the relevant land is
divided into the relevant number of units. Each proprietor has title to, and may
freely dispose of, their unit. All proprietors are members of a "body
corporate", which monitors compliance with rules governing the apartment block.
Certain parts of the property, such as stairwells, entrance lobbies and the like
are known as "common property" and are owned by the body corporate as a whole
rather than by individual proprietors.
"TORRENS TITLE" means a system of title in which the relevant land is
freehold title, interests in which are created by registration in a central land
registry of the relevant State or Territory. Each parcel of land is represented
by a specific certificate of title. The original certificate is retained by the
registry, and in most States a duplicate certificate is issued to the owner. Any
dealing with the relevant land is carried out by pro forma instruments which
become effective on registration.
I-1
<PAGE>
AII-1
APPENDIX II--TERMS AND CONDITIONS OF THE CLASS A NOTES
I-2
<PAGE>
AIII-1
APPENDIX III--TERMS AND CONDITIONS OF THE CLASS B NOTES
I-3
<PAGE>
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE OFFERED CERTIFICATES OFFERED HEREBY, NOR AN
OFFER OF THE OFFERED CERTIFICATES IN ANY STATE OR JURISDICTION IN WHICH, OR TO
ANY PERSON TO WHOM, SUCH OFFER WOULD BE UNLAWFUL. THE DELIVERY OF THIS
PROSPECTUS AT ANY TIME DOES NOT IMPLY THAT INFORMATION HEREIN OR THEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE; HOWEVER, IF ANY MATERIAL CHANGE
OCCURS WHILE THE PROSPECTUS IS REQUIRED BY LAW TO BE DELIVERED, THE PROSPECTUS
WILL BE AMENDED OR SUPPLEMENTED ACCORDINGLY.
--------------
TABLE OF CONTENTS
PROSPECTUS
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
Summary of Terms................................ 13
Structural Chart................................ 28
Cash Flow Summary............................... 29
Cash Flow Chart................................. 32
Risk Factors.................................... 34
Formation of the Trust.......................... 43
Security for the Notes.......................... 44
The Trust Fund.................................. 50
The Issuer Trustee.............................. 59
Originator of the Housing Loans................. 64
The Servicer.................................... 65
The Trust Manager............................... 69
Westpac Residential Loan Program................ 71
The Mortgage Insurance Policies................. 76
Principal Payment and Yield Considerations...... 82
Description of the Offered Notes................ 85
Description of the Servicing Agreement.......... 122
The Liquidity Facility.......................... 128
Description of the Swap Agreements.............. 131
Currency Swap Providers......................... 135
Certain Legal Aspects of the Housing Loans...... 136
Use of Proceeds................................. 141
United States Federal Income Tax Consequences... 141
Certain Australian Tax Matters.................. 143
ERISA Considerations............................ 145
Ratings of the Notes............................ 146
Legal Investment Considerations................. 146
Underwriting.................................... 146
Listing and General Information for Non-U.S.
Investors...................................... 147
Legal Matters................................... 149
Index of Defined Terms.......................... 150
Appendix I--Glossary of Australian Legal Terms
Appendix....................................... I-1
Appendix II--Terms and Conditions of the Class A
Notes.......................................... I-2
Appendix III--Terms and Conditions of the Class
B Notes........................................ I-3
</TABLE>
US$
(APPROXIMATE)
WESTPAC SECURITIES
ADMINISTRATION LIMITED
IN ITS CAPACITY AS ISSUER TRUSTEE OF THE
SERIES 1998-IG WST TRUST
US$ CLASS A MORTGAGE BACKED FLOATING RATE NOTES DUE
US$ CLASS B MORTGAGE BACKED FLOATING RATE NOTES DUE
MORTGAGE BACKED FLOATING
RATE NOTES
---------------------
PROSPECTUS
---------------------
J.P. MORGAN & CO.
MORGAN STANLEY DEAN WITTER
MAY , 1998
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
<PAGE>
SUBJECT TO COMPLETION, DATED MAY , 1998
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
PRELIMINARY PROSPECTUS
US$
WESTPAC SECURITIES ADMINISTRATION LIMITED
(ACN 000 049 472)
IN ITS CAPACITY AS TRUSTEE OF THE
SERIES 1998-1G WST TRUST
US$ CLASS A MORTGAGE BACKED FLOATING RATE NOTES DUE
US$ CLASS B MORTGAGE BACKED FLOATING RATE NOTES DUE
Interest on the Class A Mortgage Backed Floating Rate Notes (the "Class A
Notes") and the Class B Mortgage Backed Floating Rate Notes (the "Class B Notes"
and together with the Class A Notes, the "Offered Notes") offered hereby and
issued by Westpac Securities Administration Limited solely in its capacity as
trustee of the Series 1998-1G WST Trust (the "Trust") (the "Issuer Trustee")
will be payable quarterly on the 19th day of each of April, July, October and
January (or if such 19th day is not a Business Day (as defined herein), the next
succeeding Business Day in the same month or, if not in the same month, the
immediately preceding Business Day), commencing July 19, 1998 (each, a "Payment
Date"). The principal of a class of Offered Notes will be payable on its
maturity date indicated above, subject to earlier redemption in whole or in part
as described herein. Only the Offered Notes are offered hereby.
The Offered Notes will be collateralized by a pool of variable and fixed
rate residential housing loans secured by Mortgaged Properties (as defined
herein) located in Australia (the "Housing Loans") which are repayable in
Australian dollars, rights under certain insurance policies with respect to the
Housing Loans, amounts on deposit in certain accounts, amounts invested in
Authorized Investments (as defined herein) and the Issuer Trustee's rights under
the Transaction Documents (as defined herein) (collectively, the "Trust
Assets"). The Housing Loans are from a general portfolio of residential Housing
Loans which have been originated by Westpac Banking Corporation (ARBN 007 457
141) ("Westpac") in the ordinary course of its business. The Housing Loans will
be sold either by Westpac or the Seller Trustee (as defined herein) to the
Issuer Trustee. The Offered Notes and the Transaction Documents (other than the
Security Trust Deed) are governed by, and shall be construed in accordance with,
the laws of New South Wales, Australia. The Security Trust Deed (as defined
herein) is governed by, and shall be construed in accordance with, the laws of
the Australian Capital Territory.
(CONTINUED ON NEXT PAGE)
--------------------------
PROSPECTIVE INVESTORS IN THE NOTES SHOULD REVIEW THE INFORMATION SET FORTH
UNDER "RISK FACTORS" BEGINNING ON PAGE 23 HEREIN.
THE OFFERED NOTES REPRESENT OBLIGATIONS OF THE ISSUER TRUSTEE IN ITS CAPACITY AS
TRUSTEE OF THE TRUST ONLY AND DO NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF
WESTPAC, THE MORTGAGE COMPANY PTY LIMITED, WESTPAC SECURITISATION
MANAGEMENT PTY LIMITED, ANY OF THEIR RESPECTIVE AFFILIATES (OTHER THAN
THE ISSUER TRUSTEE) OR ANY GOVERNMENT OR GOVERNMENTAL AGENCY.
NEITHER THE OFFERED NOTES NOR THE HOUSING LOANS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENT OR GOVERNMENTAL AGENCY EXCEPT TO
THE LIMITED EXTENT DESCRIBED HEREIN.
THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
Proceeds to
Underwriting Issuer
Price to Public Discount Trustee(2)
<S> <C> <C> <C>
Class A Notes(1)................................... % % %
Class B Notes(1)................................... % % %
Total.............................................. US$ US$ US$
</TABLE>
(1) Plus accrued interest, if any, at the applicable rate from .
(2) Before deducting expenses, estimated to be US$ .
Application has been made to the London Stock Exchange Limited (the "London
Stock Exchange") for the Offered Notes to be admitted to the Official List.
Copies of this Prospectus and the Appendices, which comprises Listing
Particulars with regard to the Issuer Trustee and the Notes in accordance with
the listing rules made under Part IV of the Financial Services Act of 1986, have
been delivered to the Registrar of Companies in England of Wales for
registration in accordance with Section 149 of that Act.
This Prospectus may be used by Westpac Banking Corporation, an affiliate of
the Trust Manager and the Issuer Trustee, in connection with offers and sales
related to secondary market transactions in the Offered Notes. Westpac Banking
Corporation may act as principal or agent in such transactions. Such sales will
be made at prices related to prevailing market prices at the time of sale or
otherwise.
WESTPAC BANKING CORPORATION
2
<PAGE>
UNDERWRITING
This Prospectus may be used by Westpac Banking Corporation, an affiliate of
the Trust Manager and the Issuer Trustee, in connection with offers and sales
related to secondary market transactions in the Offered Notes. Westpac Banking
Corporation may act as principal or agent in such transactions. Such sales will
be made at prices related to prevailing market prices at the time of sale or
otherwise. Westpac Banking Corporation does not have any obligation to make a
market in the Offered Notes, and it may discontinue any such market-making
activities at any time without notice, in its sole discretion. Westpac Banking
Corporation is among the underwriters participating in the initial distribution
of the Offered Notes.
142
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*
The following table sets forth the estimated expenses in connection with the
issuance and distribution of the Notes being registered under this Registration
Statement, other than underwriting discounts and commissions:
<TABLE>
<S> <C>
SEC Registration Fee............................................... $ 295.00
Printing and Engraving............................................. $ **
Legal Fees and Expenses............................................ $ **
Trustee Fees and Expenses.......................................... $ **
Rating Agency Fees................................................. $ **
Miscellaneous...................................................... $ **
---------
Total........................................................ $ **
---------
---------
</TABLE>
- ------------------------
* All amounts except the SEC Registration Fee are estimates of expenses
incurred in connection with the issuance and distribution of the Notes.
** To be supplied by amendment.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
[Include Indemnification Arrangements from Registrant's Certificate of
Incorporation]
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
The Registrant has not previously sold unregistered securities.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.*
3.1 Memorandum of Association of the Registrant.
3.2 Articles of Association.
4.1 Master Trust Deed.**
4.2 The Series Notice.*
4.3 The Note Trust Deed.*
4.4 The Security Trust Deed.**
5.1 Opinion of Allen Allen & Hemsley as to legality of the Notes.*
8.1 Opinion of Mayer, Brown & Platt as to certain tax matters.*
10.1 The Servicing Agreement.
10.2 Form of Servicing Agreement Amendment Agreement.
10.3 The Liquidity Facility Agreement.
10.4 The Redraw Facility Agreement.
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <S>
23.1 Consent of Allen Allen & Hemsley (included in Exhibit 5.1 hereof)*
23.2 Consent of Mayer, Brown & Platt (included in Exhibit 8.1 hereof).*
24.1 Power of Attorney (included on signature pages).**
25.1 Statement of Eligibility of Trustee.*
99.1 Opinion of Allen Allen & Hemsley as to Enforceability of U.S. Judgments under
Australian Law.*
</TABLE>
- ------------------------
* To be filed by amendment.
** Previously filed.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant on behalf of the Westpac Securitization Trust,
Series 1998-1G (the "Trust") hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) To file a post-effective amendment to the registration statement to
include any financial statements required by Rule 3-19 at the start of any
delayed offering or throughout a continuous offering.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-2
<PAGE>
For purposes of determining any liability under the Securities Act of 1933,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
For the purposes of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-11 and has duly caused this Amendment No. 2 to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Sydney, Australia, on the 5th day of
May 1998.
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
BY /S/ LEWIS E. LOVE, JR.
------------------------------------------
Lewis E. Love, Jr.
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 2 to the Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
SIGNATURE TITLE DATE
- ------------------------------ ---------------------------
*R. PATRICK HANDLEY Principal Executive Officer May 5, 1998
- ------------------------------ and Director
R. Patrick Handley
*MARTEN TOUW Principal Financial Officer May 5, 1998
- ------------------------------ and Director
Marten Touw
*DAVID VAZ Principal Accounting May 5, 1998
- ------------------------------ Officer
David Vaz
*KIMBERLEY GIRE Director May 5, 1998
- ------------------------------
Kimberley Gire
/s/ *LEWIS E. LOVE, JR. Director May 5, 1998
- ------------------------------
Lewis E. Love, Jr.
*PHIL CHRONICAN Director May 5, 1998
- ------------------------------
Phil Chronican
/s/ *LEWIS E. LOVE, JR.
- ------------------------------
By: Lewis E. Love, Jr.
ATTORNEY-IN-FACT
II-4
<PAGE>
SIGNATURE OF AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act of 1933,
the undersigned hereby certifies that it is the duly authorized representative
in the United States of the Registrant with respect to the Registration
Statement and signs this Amendment No. 2 to the Registration Statement solely in
such capacity and for the limited purpose of said Section 6(a).
<TABLE>
<S> <C> <C>
/s/ LEWIS E. LOVE, JR.
---------------------------------------------
Name: Lewis E. Love, Jr.
Director & Secretary
Address: Westpac Securitisation Management
Pty Limited
575 Fifth Avenue
39th Floor
New York, New York 10017-2422
Telephone: (212) 551-1905
</TABLE>
II-5
<PAGE>
EXHIBITS INDEX
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT PAGE
NO. DESCRIPTION OF EXHIBIT NUMBER
- ----------- --------------------------------------------------------------------------------------------- ---------------
<C> <S> <C>
1.1 Form of Underwriting Agreement.*
3.1 Memorandum of Association of the Registrant.
3.2 Articles of Association.
4.1 Master Trust Deed.**
4.2 The Series Notice.*
4.3 The Note Trust Deed.*
4.4 The Security Trust Deed.**
5.1 Opinion of Allen Allen & Hemsley as to legality of the Notes.*
8.1 Opinion of Mayer, Brown & Platt as to certain tax matters.*
10.1 The Servicing Agreement.
10.2 Form of the Servicing Agreement Amendment Agreement.
10.3 The Liquidity Facility Agreement.
10.4 The Redraw Facility Agreement.
23.1 Consent of Allen Allen & Hemsley (included in Exhibit 5.1 hereof)*
23.2 Consent of Mayer, Brown & Platt (included in Exhibit 8.1 hereof).*
24.1 Power of Attorney (included on signature pages).**
25.1 Statement of Eligibility of Trustee.*
99.1 Opinion of Allen Allen & Hemsley as to Enforceability of U.S. Judgments under Australian
Law.*
</TABLE>
- ------------------------
* To be filed by amendment.
** Previously filed.
<PAGE>
Exhibit 3.1
The Corporations Law
A company limited by shares
incorporated in Australian Capital Territory
----------------------------------------------
MEMORANDUM OF ASSOCIATION
of
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
(ACN 081 709 211)
----------------------------------------------
<PAGE>
1. NAME OF THE COMPANY
The name of the company is WESTPAC SECURITISATION MANAGEMENT PTY
LIMITED.
2. SHARE CAPITAL
The share capital of the company is $100,000,000 divided into
100,000,000 shares of $1.00 each.
3. LIMITED LIABILITY
The liability of the members is limited.
4. SUBSCRIBERS
The person whose name, address and occupation are set out below wishes
to form a company under this Memorandum of Association and agrees to
take the number of shares in the capital of the company set out
opposite that person's name.
<PAGE>
- ------------------------------------------------------------------------------
Full name, address and Signature of Number of shares
occupation of subscriber subscriber taken by the
subscriber
- ------------------------------------------------------------------------------
Ian Brian HOPKINS 1
29 Stonecrop Road
North Turramurra NSW 2074
Accountant Ian Brian HOPKINS
- ------------------------------------------------------------------------------
DATED this day of , 1998.
Witness to the above signature:
Donna Marie Anne DECLASE
Level 17, The Chifley Tower
2 Chifley Square, Sydney NSW 2000
<PAGE>
Exhibit 3.2
The Corporations Law
A company limited by shares
incorporated in Australian Capital Territory
----------------------------------------------
ARTICLES OF ASSOCIATION
of
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
(ACN 081 709 211)
----------------------------------------------
1 DEFINITIONS
The following definitions apply in these Articles unless the context
otherwise requires.
DIVIDEND includes an interim dividend.
DIRECTOR means a person appointed or elected to the office of director
of the company in accordance with these Articles and includes any
alternate director duly acting as a director and, where the context
permits, a sole director.
EMPLOYEE MEMBER means an employee of the company or one of its
subsidiaries, or a former employee of the company or one of its
subsidiaries, who has continued to be a member of the company.
LAW means the Corporations Law and the Corporations Regulations.
MEMBER PRESENT means, in connection with a meeting, the member present
in person or by proxy, by attorney and, where the member is a body
corporate, by representative.
PRESCRIBED RATE means the base lending rate offered by the company's
principal banker from time to time in respect of loans of $100,000
and over calculated on a daily basis and a year of 365 days.
SEAL means any common seal, duplicate common seal or official seal of
the company.
2. INTERPRETATION
Headings are for convenience only and do not affect interpretation. The
following rules of interpretation apply unless the context requires
otherwise.
(a) A GENDER includes all genders.
(b) The SINGULAR includes the plural and conversely.
(c) Where a WORD or PHRASE is defined, its other grammatical
forms have a corresponding meaning.
<PAGE>
Page 2
(d) A reference to a PARAGRAPH or SUB-PARAGRAPH is to a
paragraph or sub-paragraph, as the case may be, of the
Article or paragraph, respectively, in which the
reference appears.
(e) A reference to any LEGISLATION or to any PROVISION of
any legislation includes any modification or
re-enactment of it, any legislative provision
substituted for it, and all regulations and statutory
instruments issued under it.
(f) Division 10 of Part 1.2 of the Law applies in relation
to these Articles as if they were an instrument made
under the Law.
(g) Except in so far as a contrary intention appears in
these Articles, an expression has, in a provision of
these Articles which relates to a particular provision
of the Law, the same meaning as in that provision of
the Law.
(h) A mention of anything after INCLUDE, INCLUDES or
INCLUDING does not limit what else might be included.
3. EXCLUSION OF TABLE A
The regulations contained in Table A of Schedule 1 to the Law do not
apply to the company.
4. PROPRIETARY COMPANY PROVISIONS
(1) The company is a proprietary company.
(2) The number of members of the company is limited to 50
non-Employee Members.
(3) The company must not engage in any activity that would require
the lodgement of a prospectus, other than as is permitted by
the Law.
5. ACTIONS AUTHORISED UNDER THE LAW
Where the Law authorises or permits a company to do any matter or
thing if so authorised by its articles of association, the company is
and shall be taken by this Article to be authorised or permitted to
do that matter or thing, despite any other provisions of these
Articles.
CAPITAL
6. POWER OF DIRECTORS TO ISSUE SECURITIES
(1) The directors may issue shares or options over shares in, and
other securities of, the company.
(2) Any share, option or other security may be issued with such
preferred, deferred or other special rights or such
restrictions, whether with regard to dividends, voting, return
of capital, payment of calls or otherwise, as the directors
may decide.
(3) Paragraph (1) has effect without prejudice to any special
rights conferred on the holders of any issued shares, options
or other securities.
<PAGE>
Page 3
7. PREFERENCE SHARES
Subject to the Law, the directors may issue preference shares that are,
or at the option of the company are to be, liable to be redeemed.
8. CLASSES OF SHARES
(1) This Article applies if at any time the share capital is
divided into different classes of shares.
(2) The rights attached to any class (unless otherwise provided by
the terms of issue of the shares of that class) may, whether
or not the company is being wound up, be varied:
(a) with the consent in writing of the holders of
three-fourths of the issued shares of that class; or
(b) with the sanction of a special resolution passed at
a separate general meeting of the holders of the
shares of the class;
(3) The provisions of these Articles relating to general meetings
apply in so far as they are capable of application to every
separate class except that any holder of shares of the class
present may demand a poll.
(4) The rights conferred on the holders of the shares of any class
issued with preferred or other special rights shall not,
unless otherwise provided by these Articles, or by the terms
of issue of the shares of that class, be taken to be varied,
abrogated or otherwise affected by the creation or issue of
further shares ranking equally with those shares.
(5) The issue of any securities ranking in priority, or any
conversion of existing securities to securities ranking in
priority to an existing class of preference shares, is a
variation or abrogation of the rights attaching to that
existing class of preference shares.
9 BROKERAGE AND COMMISSION
(1) The company may exercise the powers to pay brokerage or
commission conferred by the Law in the manner provided by the
Law.
(2) The brokerage or commission may be satisfied by:
(a) the payment of cash;
(b) the allotment of fully or partly paid shares; or
(c) partly by the payment of cash and partly by
the allotment of fully or partly paid shares.
<PAGE>
Page 4
10. RECOGNITION OF THIRD PARTY INTERESTS
(1) Except as required by law, the company shall not recognise a
person as holding a share on any trust.
(2) Whether or not it has notice of the rights or interests
concerned, the company is not bound to recognise:
<PAGE>
Page 5
(a) any equitable, contingent, future or partial
interest in any share or unit of a share; or
(b) any other right in respect of a share,
except an absolute right of ownership of the member or
as otherwise provided by these Articles or by law.
11. REGISTER OF DEBENTURE HOLDERS: SUSPENSION
If at any time the company has issued debentures and keeps a register
of debenture holders, the company may close its register of debenture
holders during a period or periods not exceeding in aggregate 30 days
in any calendar year.
CERTIFICATES FOR SHARES
12. SHARE CERTIFICATES
(1) A person whose name is entered as a member in the register of
members is entitled without payment to receive a certificate
in respect of the member's shares under the Seal in accordance
with the Law.
(2) The company is not bound to issue more than one certificate in
respect of a share or shares held jointly by several persons.
(3) Delivery of a certificate for a share to one of several joint
holders is sufficient delivery to all of the joint holders.
13. FORM OF SHARE CERTIFICATES
A certificate for shares shall be in a form that the directors from
time to time decide.
14. WORN OUT OR DEFACED SHARE CERTIFICATES
(1) Subject to paragraph (2), the provisions of the Law with
respect to certificates which are lost or destroyed shall
apply to certificates which are worn out or defaced. The
directors may exercise all the powers in relation to
certificates which are lost, destroyed, worn out or defaced as
are exercisable by the company or its directors under the Law
in relation to certificates that are lost or destroyed.
(2) The company:
(a) shall issue a certificate in replacement of a worn
out or defaced certificate only if the certificate to
be replaced is received by the company for
cancellation and is cancelled; and
(b) may require the payment of any amount as the
directors determine in connection with the issue of a
replacement certificate.
<PAGE>
Page 6
LIEN ON SHARES
15. LIEN ON SHARES
(1) The company has a first and paramount lien on every share for:
(a) any amount due and unpaid in respect of the share
which has been called or is payable at a fixed time;
(b) any amounts which remain outstanding on loans made by
the company to acquire shares under an employee
incentive scheme;
(c) all amounts that the company may be called on by law
to pay in respect of the share.
(2) The directors may at any time exempt a share wholly or in part
from the provisions of this Article.
(3) The company's lien (if any) on a share extends to all
Dividends payable and entitlements deriving in respect of the
share. The directors may retain those Dividends or
entitlements and may apply them in or towards satisfaction of
all amounts due to the company in respect of which the lien
exists.
(4) No person shall be entitled to exercise any rights or
privileges as a member until the member has paid all calls,
instalments of calls and other moneys (including interest) for
the time being payable in respect of every share held by the
member.
(5) Paragraph (6) shall apply if the company is or may in the
future be liable, under the law of any jurisdiction in or
outside Australia:
(a) in respect of any shares registered in the name of a
member (whether solely or jointly with others); or
(b) in respect of any Dividends, interest, bonuses or
other moneys or distributions paid or payable or
entitlements derived or deriving in respect of any
such shares;
to pay any amount for or on account or in respect of any
member, whether in consequence of the death of that member,
the non-payment of any income or other tax by that member, the
non-payment of any estate, probate, succession, death, stamp
or other duty by the member or by the executor or
administrator of the estate of that member or otherwise.
(6) The company:
(a) shall be fully indemnified by the member referred to in
paragraph (5) or the member's estate from and against
the liability referred to in that paragraph;
(b) shall have a lien on the shares registered in the name
of that member for all moneys paid or payable by the
company in respect of those shares under or in
consequence of the liability; and
(c) may recover, as a debt due from that member or the
member's estate, those moneys by deducting from any
Dividend or any other amount payable to the member in
respect of the shares or otherwise (together with
interest on the sum from the day of payment by the
company to the time of actual repayment by the member or
the member's estate at a
<PAGE>
Page 7
rate not exceeding the Prescribed Rate, but the
directors may waive payment of interest wholly or in
part).
16. EXERCISE OF LIEN
(1) Subject to paragraph (2), the company may sell any shares on
which the company has a lien, in the manner that the directors
think fit.
(2) A share on which the company has a lien shall not be sold
unless:
(a) a sum in respect of which the lien exists is payable;
and
(b) at least 7 days before the date of the sale, the company
has given to the member or the person entitled to the
share by reason of the death or bankruptcy of the
member, a notice in writing demanding payment of the
sum.
17. COMPLETION OF SALE
(1) For the purpose of giving effect to a sale of shares under
lien, the directors may authorise a person to do everything
necessary to transfer the shares sold to the purchaser of the
shares.
(2) The company shall register the purchaser as the holder of the
shares comprised in any transfer, after which the validity of
the sale may not be impeached by any person, and the purchaser
is not bound to see to the application of the purchase money.
(3) The title of the purchaser to the shares is not affected by
any irregularity or invalidity in connection with the sale.
(4) The purchaser shall be discharged from liability for any calls
which may have been due before the purchase of those shares,
unless otherwise expressly agreed.
(5) The remedy of any person aggrieved by any sale shall be in
damages only and against the company exclusively.
18. APPLICATION OF PROCEEDS OF SALE
The proceeds of a sale made under a lien shall be applied by the
company in payment of the part of the amount in respect of which the
lien exists as is presently payable. Any residue shall be paid to the
person entitled to the shares immediately prior to the sale.
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CALLS ON SHARES
19. DIRECTORS' POWER TO MAKE CALLS
(1) The directors may make calls on the members in respect of any
money unpaid on the shares of the members (whether on account
of the nominal amount of the shares or by way of premium)
which is not by the terms of issue of those shares made
payable at fixed times.
(2) Each member shall, on receiving at least 14 days' notice
specifying the time or place of payment, pay to the company at
the time and place so specified the amount called on the
member's shares.
(3) The directors may revoke or postpone a call.
(4) A call may be required to be paid by instalments.
(5) A call is made at the time when the resolution of the
directors authorising the call was passed.
(6) The non-receipt of a notice of a call by, or the accidental
omission to give notice of a call to, any member shall not
invalidate the call.
20. LIABILITY OF JOINT HOLDERS FOR CALLS
The joint holders of a share are jointly and severally liable to pay
all calls in respect of the share.
21. INTEREST ON UNPAID AMOUNTS
(1) If a sum called or otherwise payable to the company in respect
of a share is not paid before or on the day appointed for
payment of the sum, the person from whom the sum is due shall
pay interest on the sum from the day appointed for payment of
the sum to the time of actual payment at a rate determined by
the directors but not exceeding the Prescribed Rate together
with expenses incurred by the company by reason of
non-payment.
(2) The directors may waive payment of that interest wholly or in
part.
22. FIXED SUMS TAKEN TO BE CALLED
(1) Any sum that, under the terms of issue of a share, becomes
payable on allotment or at a fixed date (whether on account of
the nominal amount of the share or by way of premium) shall,
for the purposes of these Articles, be taken to be a call duly
made and payable on the date on which under the terms of issue
the sum becomes payable.
(2) If any other sum is not paid when due, all the provisions of
these Articles relating to payment of interest and expenses,
forfeiture or otherwise apply as if that sum had become
payable by virtue of a call duly made and notified.
23. DIFFERENTIATION BETWEEN HOLDERS
The directors may, on the issue of shares, differentiate between the
holders as to the amount of calls to be paid and the times of payment.
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24. PREPAYMENTS OF CALLS
(1) The directors may accept from a member the whole or a part of
the amount unpaid on a share even if that amount has not been
called.
(2) The directors may authorise payment by the company of interest
on the whole or any part of an amount accepted under paragraph
(1), until the amount becomes payable, at a rate, not
exceeding the Prescribed Rate, which is agreed between the
directors and the member paying the sum.
(3) The directors may at any time repay the whole or any part of
any amount paid in advance on serving the member with one
month's notice of its intention to do so.
TRANSFER OF SHARES
25. TRANSFERABILITY OF CERTIFICATED SHARES
(1) Subject to these Articles and the Law, a member's shares may
be transferred by instrument in writing, in any form
authorised by Law or in any other form that the directors
approve.
(2) A transferor of shares remains the holder of the shares
transferred until the transfer is registered.
26. REGISTRATION OF TRANSFERS
(1) The following documents must be lodged for registration at the
registered office of the company or the location of the
relevant share register:
(a) the instrument of transfer;
(b) the certificate (if any) for the shares; and
(c) any other information that the directors may require to
establish the transferor's right to transfer the shares.
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(2) On compliance with paragraph (1), the company shall, subject
to the powers of the company to refuse registration, register
the transferee as a member.
(3) The directors may waive compliance with paragraph (1)(b) on
receipt of satisfactory evidence of loss or destruction of the
certificate.
27. RESTRICTION ON TRANSFER OF SHARES
(1) The directors may in their absolute discretion refuse to
register any transfer of shares and may decline to give their
reasons for doing so.
(2) Where the directors resolve to refuse to register a transfer
of shares, the directors shall notify the transferee not later
than 2 months after the date on which the transfer was lodged
with the company.
28. WHERE REGISTRATION MAY BE REFUSED
The circumstances in which the directors may refuse to register a
transfer of shares include the following:
(a) where the registration of the transfer would result in a
contravention of or failure to observe the provisions of
a law of a state or territory or of the Commonwealth;
(b) where the company has a lien on any of the shares;
(c) where any of the shares are the subject of a call which
has been made and is unpaid and;
(d) where more than 3 persons are to be registered as joint
holders, except in the case of executors or trustees of
a deceased shareholder.
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29. SUSPENSION OF TRANSFERS
The registration of transfers of shares may be suspended at any time
and for any period as the directors from time to time decide. The
aggregate of those periods shall not exceed in the aggregate 30 days
in any calendar year.
TRANSMISSION OF SHARES
30. ENTITLEMENT TO SHARES ON DEATH
(1) Where a member dies:
(a) the survivor or survivors, where the member was a joint
holder; and
(b) the legal personal representatives of the deceased,
where the member was a sole holder,
shall be the only persons recognised by the company as having
any title to the member's interest in the shares.
(2) The directors may require evidence of a member's death as they
think fit.
This Article does not release the estate of a deceased joint
holder from any liability in respect of a share that had been
jointly held by the holder with other persons.
31. REGISTRATION OF PERSONS ENTITLED
(1) Subject to the Bankruptcy Act 1966 and to the production of
any information that is properly required by the directors, a
person becoming entitled to a share in consequence of the
death or bankruptcy of a member may elect to:
(a) be registered personally as holder of the share; or
(b) have another person registered as the transferee of the
share.
(2) All the limitations, restrictions and provisions of these
Articles relating to:
(a) the right to transfer;
(b) the registration of the transfer of; and
(c) the issue of certificates with respect to,
shares are applicable to any transfer as if the death or
bankruptcy of the member had not occurred and the notice or
transfer were a transfer signed by that member.
32. DIVIDENDS AND OTHER RIGHTS
(1) Where a member dies or becomes bankrupt, the member's legal
personal representative or the trustee of the member's estate
(as the case may be) is, on the production of all information
as is properly required by the directors, entitled to the
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same Dividends, entitlements and other advantages and to the
same rights (whether in relation to meetings of the company or
to voting or otherwise) as the member would have been entitled
to if the member had not died or become bankrupt.
(2) Where 2 or more persons are jointly entitled to any share as a
result of the death of a member, they shall, for the purposes
of these Articles, be taken to be joint holders of the share.
FORFEITURE OF SHARES
33. LIABILITY TO FORFEITURE
(1) If a member fails to pay a call or instalment of a call on or
before the day appointed for payment of the call or
instalment, the directors may, at any time afterwards while
any part of the call or instalment remains unpaid, serve a
notice on the member requiring payment of so much of the call
or instalment as is unpaid, together with any interest that
has accrued and all expenses of the company incurred as a
result of the non-payment.
(2) The notice shall:
(a) specify another day (not earlier than 14 days after the
date of service of the notice) on or before which and a
place at which the payment required by the notice is to
be made; and
(b) state that, if payment is not made at or before the time
specified, the shares in respect of which the call was
made shall be liable to be forfeited.
34. SURRENDER OF SHARES
Subject to law, the directors may accept the:
(a) surrender of any fully paid share by way of compromise
of any question as to the proper registration of the
holder or in satisfaction of any payment due to the
company; and
(b) gratuitous surrender of any fully paid share.
Any share so surrendered may be disposed of in the same manner as a
forfeited share.
35. POWER TO FORFEIT
(1) If the requirements of a notice served under Article 33 are
not complied with, any share in respect of which the notice
has been given may at any time afterwards, but before the
payment required by the notice has been made, be forfeited by
a resolution of the directors to that effect.
(2) Such a forfeiture shall include all Dividends declared in
respect of the forfeited shares and not actually paid before
the forfeiture.
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36. POWERS OF DIRECTORS
(1) A forfeited share may be sold or otherwise disposed of on the
terms and in the manner that the directors think fit.
(2) The forfeiture may be cancelled on the terms that the
directors think fit at any time before a sale or disposition.
(3) Any residue from the proceeds of sale of a forfeited share,
after satisfaction of any calls or instalments due and unpaid
and accrued interest and expenses in respect of those shares,
shall be paid to the person entitled to those shares at the
time of the forfeiture, to the executors, administrators or
assigns of the person or as the person directs.
37. CONSEQUENCES OF FORFEITURE
A person whose shares have been forfeited:
(a) ceases to be a member in respect of the forfeited shares
at the time and on the date of the passing of the
directors' resolution approving the forfeiture;
(b) shall have no claims or demands against the company in
respect of those shares;
(c) shall have no other rights incident to the shares except
the rights that are expressly provided by the Law or
saved by these Articles; and
(d) remains liable to pay to the company all money that, at
the date of forfeiture, was payable by the person to the
company in respect of the shares (including, if the
directors think fit, interest from the date of
forfeiture at the Prescribed Rate on the money for the
time being unpaid). The directors may (but shall not be
obliged to) enforce the payment of the money or any part
of the money for which the member is liable as they
think fit.
38. NOTICE OF FORFEITURE
(1) Notice of the resolution of forfeiture shall be given to the
member in whose name the share was registered immediately
before the forfeiture and an entry of the forfeiture and its
date shall be made immediately in the register.
(2) The provisions of paragraph (1) are directory only and the
validity of any forfeiture shall not be affected in any way by
any omission to give the notice or to note the entry.
39. EVIDENTIARY MATTERS
Without prejudice to Article 38, a statement in writing by a director
or a secretary of the company to the effect that:
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(a) a share in the company has been duly forfeited on a date
specified in the statement; or
(b) a particular sum is payable by a member or former member
to the company as at a particular date in respect of a
call or instalment of a call (including interest),
is prima facie evidence of the facts set out in the statement as
against all persons claiming to be entitled to the share and against
the member or former member who remains liable to the company under
Article 37.
40. TRANSFERS AFTER FORFEITURE AND SALE
(1) The company may:
(a) receive the consideration (if any) given for a forfeited
share on any sale or disposition of the share; and
(b) effect a transfer of the share in favour of the person
to whom the share is sold or disposed of.
(2) On the completion of the transfer, the transferee shall be
registered as the holder of the share and is not bound to see
to the application of any money paid as consideration.
(3) The title of the transferee to the share is not affected by
any irregularity or invalidity in connection with the
forfeiture, sale or disposal of the share.
41. FIXED AMOUNTS TAKEN TO BE CALLS
The provisions of these Articles relating to forfeiture apply in the
case of non-payment of any sum that, under the terms of issue of a
share, becomes payable at a fixed time, whether on account of the
nominal amount of the share or by way of premium, as if that sum had
become payable by virtue of a call duly made.
CONVERSION OF SHARES INTO STOCK
42. POWER TO CONVERT SHARES INTO STOCK
(1) The company may by resolution passed in general meeting:
(a) convert or provide for the conversion of all or any of
its paid up shares into stock; or
(b) reconvert or provide for the reconversion of that stock
into paid up shares of any denomination.
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43. TRANSFER OF STOCK
(1) Subject to paragraph (2), where shares have been converted
into stock, the provisions of these Articles relating to the
transfer of shares apply, so far as they are capable of
application, to the transfer of the stock or any part of the
stock.
(2) The directors may fix the minimum amount of stock transferable
and restrict or forbid the transfer of fractions of that
minimum, but the minimum shall not exceed the aggregate of the
nominal amount of the shares from which the stock arose.
44. RIGHTS AND PRIVILEGES OF MEMBERS
(1) The holders of stock have, according to the amount of the
stock held by them, the same rights, privileges and advantages
as regards Dividends, voting at meetings of the company and
other matters as they would have if they held the shares from
which the stock arose.
(2) No such right, privilege or advantage (except participation in
the Dividends and profits of the company and in the property
of the company on winding up) shall be conferred by any amount
of stock that would not, if existing in shares, have conferred
that right, privilege or advantage.
45. INTERPRETATION
The provisions of these Articles that are applicable to paid up shares
apply to stock and references in those provisions to share and member
shall be read as including references to stock and stockholder
respectively.
ALTERATION OF CAPITAL
46. POWER TO ALTER CAPITAL
The company may by resolution passed in general meeting alter the
provisions of its memorandum:
(a) by increasing its share capital by the creation of new
shares of such amount as it thinks expedient;
(b) by consolidating and dividing all or any of its share
capital into shares of a larger amount than its existing
shares;
(c) by subdividing all or any of its shares into shares of
smaller amount than is fixed by the memorandum, but so
that, in the subdivision, the proportion between the
amount paid and the amount (if any) unpaid on each share
of a smaller amount is the same as it was in the case of
the share from which the share of a smaller amount is
derived; and
(d) by cancelling shares that, at the date of the passing of
the resolution to that effect, have not been taken or
agreed to be taken by any person or that have been
forfeited and by reducing its share capital by the
amount of the shares so cancelled.
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47. POWER TO REDUCE CAPITAL
Subject to the Law the company may, by special resolution, reduce its
share capital, any capital redemption reserve fund and any share
premium account.
GENERAL MEETINGS
48. POWER OF DIRECTORS TO CONVENE
(1) Any director may convene a general meeting whenever the
director thinks fit.
(2) The members shall be entitled to require the directors to
convene a general meeting under section 246 of the Law, but
shall not be entitled to convene a general meeting under
section 247 of the Law.
(3) Any director may cancel by notice in writing to all members
any meeting convened by the director, except that a meeting
convened on the requisition of a member or members shall not
be cancelled without their consent.
(4) The directors may postpone a general meeting or change the
place at which it is to be held by notice, not later than 72
hours prior to the time of the meeting, to all persons to whom
the notice of meeting (the FIRST NOTICE) was given. The
postponing notice shall specify the place, date and time of
the meeting. The meeting shall be taken to have been duly
convened under the first notice.
49. NOTICE OF GENERAL MEETINGS
(1) Each notice convening a general meeting shall specify:
(a) the place, date and hour of the meeting; and
(b) the general nature of any special business to be
transacted at the meeting.
(2) The non-receipt of a notice convening a general meeting by or
the accidental omission to give notice to any person entitled
to receive notice shall not invalidate the proceedings at or
any resolution passed at the meeting.
50. BUSINESS OF GENERAL MEETINGS
Unless all members are present as Members Present and agree
otherwise, no business shall be transacted at any general meeting
except as set out in the notice of the meeting.
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51. QUORUM
(1) No business shall be transacted at any general meeting unless
a quorum of members is present at the time when the meeting
proceeds to business.
(2) Except as otherwise provided in these Articles, 2 Members
Present shall constitute a quorum.
52. IF QUORUM NOT PRESENT
If a quorum is not present within 20 minutes after the time appointed
for the meeting:
(1) where the meeting was convened on the requisition of members,
the proposed meeting shall be dissolved (subject to Article
54(1));
(2) in any other case:
(a) the meeting stands adjourned to a day and at a time and
place as the directors decide or, if no decision is made
by the directors, to the same day in the next week at
the same time and place; and
(b) if at the adjourned meeting a quorum is not present
within 20 minutes after the time appointed for the
meeting, the meeting shall be dissolved.
53. CHAIRMAN OF MEETINGS
(1) Subject to paragraph (2), the chairman of directors or, in the
chairman's absence, the deputy chairman shall preside as
chairman at every general meeting.
(2) Where a general meeting is held and:
(a) there is no chairman or deputy chairman; or
(b) the chairman or deputy chairman is not present within 15
minutes after the time appointed for the meeting or does
not wish to act as chairman of the meeting,
the directors present shall choose one of their number or, in
the absence of all directors or if none of the directors
present wish to act, the Members Present shall elect one of
their number to be chairman of the meeting.
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54. ADJOURNMENTS
(1) the chairman may and shall if so directed by the meeting
adjourn the meeting from time to time and from place to place.
(2) No business shall be transacted at any adjourned meeting other
than the business left unfinished at the meeting from which
the adjournment took place.
(3) When a meeting is adjourned for 30 days or more, notice of the
adjourned meeting shall be given as in the case of an original
meeting.
(4) Except as provided by paragraph (3), it is not necessary to
give any notice of an adjournment or of the business to be
transacted at an adjourned meeting.
55. VOTING AT GENERAL MEETINGS
(1) Any resolution to be considered at a meeting shall be decided
on a show of hands unless a poll is (before or on the
declaration of the result of the show of hands) demanded.
(2) A declaration by the chairman that a resolution has on a show
of hands been carried or lost and an entry to that effect in
the minutes of the meeting shall be taken as conclusive
evidence of the fact without the need to show the number or
proportion of the votes recorded in favour of or against the
resolution.
(3) A poll may be demanded:
(a) by the chairman;
(b) by at least 2 Members Present and having the right to
vote at the meeting;
(c) by a Member or Members Present and representing not less
than one-tenth of the total voting rights of all the
members (whether present or not) having the right to
vote at the meeting; or
(d) by a Member or Members Present holding shares in the
company conferring a right to vote at the meeting on
which an aggregate sum has been paid up equal to not
less than one-tenth of the total sum paid up on all the
shares conferring that right.
(4) The demand for a poll may be withdrawn.
(5) A poll may not be demanded on the election of a chairman or on
a resolution for adjournment.
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56. PROCEDURE FOR POLLS
(1) A poll when demanded shall be taken in the manner and at the
time the chairman directs.
(2) The result of the poll shall be a resolution of the meeting at
which the poll was demanded.
(3) The demand for a poll shall not prevent a meeting from
continuing for the transaction of any business other than that
on which a poll has been demanded.
57. CHAIRMAN'S CASTING VOTE
In the case of an equality of votes on a show of hands or on a poll the
chairman of the meeting has a casting vote in addition to any vote to
which the chairman may be entitled as a member.
58. REPRESENTATION AND VOTING OF MEMBERS
Subject to these Articles and any rights or restrictions for the time
being attached to any class or classes of shares:
(a) at meetings of members or classes of members each member
entitled to attend and vote may attend and vote in
person or by proxy or attorney and (where the member is
a body corporate) by representative;
(b) on a show of hands, every Member Present having the
right to vote at the meeting has one vote and;
(c) on a poll, every Member Present having the right to vote
at the meeting has one vote for each fully paid share.
59. JOINT HOLDERS
Where more than one joint holder votes, the vote of the holder whose
name appears first in the register of members shall be accepted to
the exclusion of the others whether the vote is given personally, by
attorney or proxy.
60. MEMBERS OF UNSOUND MIND AND MINORS
(1) If a member is:
(a) of unsound mind;
(b) a person whose person or estate is liable to be dealt
with in any way under the law relating to mental health;
or
(c) a minor,
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the member's committee or trustee or any other person as
properly has the management or guardianship of the member's
estate or affairs may, subject to paragraph (2), exercise any
rights of the member in relation to a general meeting as if
the committee, trustee or other person were the member.
(2) Any person with powers of management or guardianship shall not
exercise any rights under paragraph (1) unless and until the
person has provided the directors with satisfactory evidence
of the person's appointment and status.
61. RESTRICTION ON VOTING RIGHTS - UNPAID AMOUNTS
A member is not entitled to attend or vote at a general meeting
unless all calls and other sums presently payable by the member in
respect of shares in the company have been paid.
62. OBJECTIONS TO QUALIFICATION TO VOTE
(1) An objection to the qualification of a person to vote may be
raised only at the meeting or adjourned meeting at which the
vote objected to is tendered.
(2) Any objection shall be referred to the chairman of the
meeting, whose decision shall be final.
(3) A vote allowed after an objection shall be valid for all
purposes.
63. NUMBER OF PROXIES
(1) A member may appoint not more than 2 proxies. A proxy need not
be a member.
(2) An appointment of 2 proxies shall be of no effect unless each
proxy is appointed to represent a specified proportion of the
member's voting rights.
(3) If a member appoints 2 proxies, neither proxy shall be
entitled to vote on a show of hands.
64. FORM OF PROXY
(1) An instrument appointing a proxy must:
(a) be in writing under the hand of the appointor or of the
appointer's attorney duly authorised in writing; or
(b) if the appointor is a corporation, be either under seal
or under the hand of a duly authorised officer or
attorney.
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(2) An instrument appointing a proxy may specify the manner in
which the proxy is to vote in respect of a particular
resolution. Where it does so, the proxy is not entitled to
vote on the resolution except as specified in the instrument.
A proxy may vote as the proxy thinks fit on any motion or
resolution in respect of which no manner of voting is
indicated.
(3) An instrument appointing a proxy shall be taken to confer
authority to demand or join in demanding a poll.
(4) An instrument appointing a proxy shall be in any form that the
directors may accept or stipulate.
(5) Despite Article 59, where an instrument of proxy is signed by
all of the joint holders of any shares, the votes of the proxy
so appointed shall be accepted in respect of those shares to
the exclusion of any votes tendered by a proxy for any one of
those joint holders.
65. LODGMENT OF PROXIES
(1) An instrument appointing a proxy shall not be treated as valid
unless:
(a) the instrument; and
(i) the power of attorney or other authority (if
any) under which he instrument is signed; or
(ii) a copy of that power or authority certified
in a manner acceptable to the directors,
and a declaration or statement by the proxy of the
non-revocation of that power or authority are lodged at any
time before commencement of the meeting or adjourned meeting
at which the person named in the instrument proposes to vote,
at the place which is specified for that purpose in the notice
convening the relevant meeting or, if none, at the registered
office of the company or the place where the meeting is held.
(2) An instrument appointing an attorney to act on behalf of a
member at all meetings of the company or at all meetings for a
specified period shall not be treated as valid unless:
(a) the power of attorney or a certified copy of that power
of attorney; and
(b) any evidence that the directors may require of the
validity and non-revocation of that power of attorney,
are lodged at any time before commencement of the meeting or
adjourned meeting at which the attorney proposes to vote at
the place which is specified for that purpose in the notice
convening the relevant meeting or, if none, at the registered
office of the company or the place where the meeting is held.
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(3) For the purposes of this Article, any document a legible
facsimile of which is received at a place shall be taken to
have been duly lodged at that place at the time when the
facsimile is received.
66. VALIDITY OF PROXIES
A vote exercised in accordance with the terms of an instrument of
proxy, a power of attorney or other relevant instrument of appointment
is valid despite:
(a) the previous death or unsoundness of mind of the
principal;
(b) the revocation of the instrument (or of the authority
under which the instrument was executed) or the power;
or
(c) the transfer of the share in respect of which the
instrument or power is given,
if no notice in writing of the death, unsoundness of mind, revocation
or transfer has been received by the company at its registered office
at least 24 hours (or any shorter period as the directors may permit)
before the commencement of the meeting or adjourned meeting at which
the instrument is used or the power is exercised.
67. WHERE PROXY IS INCOMPLETE
(1) No instrument appointing a proxy shall be treated as invalid
merely because:
(a) it does not contain the address of the appointor or of a
proxy;
(b) it is not dated; or
(c) it does not contain in relation to any or all
resolutions, an indication of the manner in which the
proxy is to vote.
(2) Where the instrument does not specify the name of a proxy, the
instrument shall be taken to be given in favour of the
chairman of the meeting.
68. RIGHT OF OFFICERS AND ADVISORS TO ATTEND GENERAL MEETING
(1) A director who is not a member shall be entitled to be present
and to speak at any general meeting.
(2) A secretary who is not a member shall be entitled to be
present and, at the request of the chairman, to speak at any
general meeting.
(3) Any other person (whether a member or not) requested by the
directors to attend any general meeting shall be entitled to
be present and, at the request of the chairman, to speak at
that general meeting.
69. SINGLE MEMBER RESOLUTIONS
Where the company has one member only, a document signed by that member
which records a decision of the member:
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(a) constitutes a decision of the company and is valid and
effective as if it were a resolution duly passed at a
meeting of members; and
(b) has effect as a minute of that decision.
APPOINTMENT, REMOVAL AND REMUNERATION OF DIRECTORS
70. APPOINTMENT AND REMOVAL
(1) Subject to the Law, the company may at any time by resolution
passed in general meeting:
(a) appoint any person as a director; or
(b) remove any director from office.
(2) Subject to the Law, the directors may at any time appoint any
person as a director.
(a) The first directors shall be appointed in writing by the
subscriber.
71. NO SHARE QUALIFICATION
Directors are not required to hold shares in the capital of the
company.
72. REMUNERATION
(1) Subject to paragraph (2), the directors shall be paid for
their services as directors such fees (not exceeding in
aggregate a maximum sum that is from time to time approved by
resolution of the company) as the directors determine. Any
notice convening a general meeting at which it is proposed to
seek approval to increase that maximum aggregate sum shall
specify the proposed new maximum aggregate sum and the amount
of the proposed increase.
(2) Any director who is remunerated as an executive director shall
not be paid fees under paragraph (1).
(3) The fees fixed under paragraph (1):
(a) shall be divided among the directors in the proportions
as they may agree or, if they cannot agree, equally
among them; and
(b) are exclusive of any benefits which the company provides
to directors in satisfaction of legislative schemes
including, benefits provided under superannuation
guarantee or similar schemes or any other benefit
permitted by the Law or these Articles.
(4) The directors shall also be entitled to be paid or reimbursed
for all travelling and other expenses properly incurred by
them in attending and returning from any meeting of the
directors, committee of the directors, general meeting of the
company or otherwise in connection with the business or
affairs of the company.
(5) If any director, with the approval of the directors, performs
extra services or makes any special exertions for the benefit
of the company, the directors may approve the
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payment to that director of special and additional
remuneration as the directors think fit having regard to the
value to the company of the extra services or special
exertions. Any special or additional remuneration shall not
include a commission on or percentage of profits or operating
revenue or turnover.
(6) A director may be engaged by the company in any other capacity
(other than auditor) and may be appointed on such terms as to
remuneration, tenure of office and otherwise as may be agreed
by the directors.
73. VACATION OF OFFICE
In addition to the circumstances in which the office of a director
becomes vacant:
(a) under the Law; or
(b) because of a resolution under Article 70(1)(b);
the office of a director becomes vacant if the director:
(c) becomes of unsound mind or a person whose person or
estate is liable to be dealt with in any way under the
law relating to mental health;
(d) resigns by notice in writing to the company;
(e) is absent without the consent of the directors from
meetings of the directors held during a continuous
period of 6 months; or
(f) dies.
74. RETIRING ALLOWANCE FOR DIRECTORS
(1) The company may make any payment or give any benefit to any
director or any other person in connection with the director's
retirement, resignation from or loss of office or death while
in office, if it is made or given in accordance with the Law.
(2) Subject to paragraph (1) the company may:
(a) make contracts or arrangements with a director or a
person about to become a director of the company under
which the director or any person nominated by the
director is paid or provided with a lump sum payment,
pension, retiring allowance or other benefit on or after
the director or person about to become a director ceases
to hold office for any reason;
(b) make any payment under any contract or arrangement
referred to in sub-paragraph (a); and
(c) establish any fund or scheme to provide lump sum
payments, pensions, retiring allowances or other
benefits for:
(i) directors, on them ceasing
to hold office; or
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(ii) any person including a
person nominated by the
director, in the event of
the director's death while
in office,
and from time to time pay to the fund or scheme any sum
as the company considers necessary to provide those
benefits.
(3) the company may impose any conditions and restrictions under
any contract, arrangement, fund or scheme referred to in
paragraph (2) as it thinks proper.
(4) The company may authorise any subsidiary to make a similar
contract or arrangement with its directors and make payments
under it or establish and maintain any fund or scheme, whether
or not all or any of the directors of the subsidiary are also
directors of the company.
POWERS AND DUTIES OF DIRECTORS
75. POWERS OF DIRECTORS
(1) Subject to the Law and these Articles, the business of the
company shall be managed by the directors, who may exercise
all powers of the company which are not, by the Law or these
Articles, required to be exercised by the company in general
meeting.
(2) Without limiting the generality of paragraph (1), the
directors may exercise all the powers of the company:
(a) to borrow money, to charge any property or business of
the company or all or any of its uncalled capital;
(b) to issue debentures or give any other security for a
debt, liability or obligation of the company or of any
other person; and
(c) in relation to any Seal and any overseas branch
register.
76. APPOINTMENT OF ATTORNEYS
(1) The directors may, by power of attorney, appoint any person to
be the attorney of the company for the purposes, with the
powers, authorities and discretions vested in or exercisable
by the directors for any period and subject to any conditions
as they think fit.
(2) Any appointment under paragraph (1) may be made on terms for
the protection and convenience of persons dealing with the
attorney as the directors think fit and may also authorise the
attorney to delegate all or any of the powers, authorities and
discretions vested in the attorney.
77. NEGOTIABLE INSTRUMENTS
All negotiable instruments of the company shall be executed by the
persons and in the manner that the directors decide from time to time.
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PROCEEDINGS OF DIRECTORS
78. PROCEEDINGS
(1) The directors may meet together for the despatch of business
and adjourn and otherwise regulate their meetings as they
think fit.
(2) A director may at any time, and on the request of a director a
secretary shall, convene a meeting of the directors.
(3) Reasonable notice must be given to every director of the
place, date and time of every meeting of the directors. Where
any director is for the time being outside of Australia,
notice need only be given to that director if contact details
have been given, but notice shall always be given to any
alternate director in Australia whose appointment by that
director is for the time being in force.
79. MEETINGS BY TELECOMMUNICATIONS
Where the directors are not all in attendance at one place and are
holding a meeting through a system of communication and each of the
directors can hear and be heard by one another:
(a) the participating directors shall, for the purpose of
every provision of these Articles concerning meetings
of the directors, be taken to be assembled together at
a meeting and to be present at that meeting; and
(b) all proceedings of those directors conducted in that
manner shall be as valid and effective as if conducted
at a meeting at which all of them were present.
80. QUORUM AT MEETINGS
At a meeting of directors, the number of directors whose presence is
necessary to constitute a quorum is the number determined by the
directors and, if not so determined, is 2 directors entitled to vote.
81. CHAIRMAN OF DIRECTORS
(1) The directors may elect one of their number as their chairman
and may decide the period for which the chairman is to hold
office as chairman.
(2) Where a meeting of directors is held and:
(a) a chairman has not been elected as provided by paragraph
(1); or
(b) the chairman is not present at the time appointed for
the holding of the meeting or does not wish to chair the
meeting,
the directors present shall elect one of their number to be a
chairman of the meeting.
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(3) The remuneration of the chairman from the remuneration fixed
under Article 72(1) shall be decided by the directors in
accordance with Article 72(3).
82. PROCEEDINGS AT MEETINGS
(1) Subject to these Articles, questions arising at a meeting of
directors shall be decided by a majority of votes of directors
present and voting and any such decision shall for all
purposes be taken to be a decision of the directors.
(2) In the case of an equality of votes, the chairman of the
meeting has a casting vote in addition to the chairman's
deliberative vote.
83. DISCLOSURE OF INTERESTS
(1) A director is not disqualified by the director's office from
contracting with the company in any capacity.
(2) A contract or arrangement made by the company with a director
or in which a director is in any way directly or indirectly
interested shall not be avoided merely because the director is
a party to or interested in it.
(3) A director is not liable to account to the company for any
profit derived in respect of a matter in which the director
has a material interest, merely because of the director's
office or the fiduciary relationship it entails, if the
director has:
(a) declared the director's interest in the matter as soon
as practicable after the relevant facts have come to the
director's knowledge; and
(b) not contravened these Articles or the Law in relation to
the matter.
A general notice that the director is an officer or member of
a specified body corporate or firm stating the nature and
extent of the director's interest in the body corporate or
firm shall, in relation to a matter involving the company and
that body corporate or firm, be a sufficient declaration of
the director's interest, provided the extent of that interest
is no greater at the time of first consideration of the
relevant matter by the directors than was stated in the
notice.
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(4) Subject to the Law, a director may vote in respect of a matter
in which that director has a material interest.
(5) If the provisions of this Article and the Law have been
observed by any director with regard to any contract or
arrangement in which the director is in any way interested,
the fact that the director affixed or witnessed the affixing
of a Seal to the document evidencing the contract or
arrangement shall not in any way affect its validity.
(6) A director may hold any office of employment or profit in the
company (other than auditor) in addition to holding office as
a director.
84. ALTERNATE DIRECTORS
(1) A director may:
(a) with the approval of a majority of the other directors
(if any), appoint a person (whether a member of the
company or not); or
(b) without the need for the approval of the other
directors, appoint another director,
to be an alternate director in the director's place during any
period that the director thinks fit.
(2) An alternate director is entitled to notice of meetings of the
directors and, if the appointor is not present at such a
meeting, is entitled to attend and vote in the director's
stead.
(3) An alternate director may exercise any powers that the
appointor may exercise. The exercise of any power by the
alternate director (including affixing a Seal) shall be taken
to be the exercise of the power by the appointor. The exercise
of any power by the alternate director shall be as agent of
the company and not as agent of the appointor. Where the
alternate is another director, that director shall be entitled
to cast a deliberative vote on the director's own account and
on account of each person by whom the director has been
appointed as an alternate director.
(4) The appointment of an alternate director:
(a) may be terminated at any time by the appointor even if
the period of the appointment of the alternate director
has not expired; and
(b) terminates automatically if the appointor vacates office
as a director.
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(5) An appointment or the termination of an appointment of an
alternate director shall be effected by service on the company
of a notice in writing signed by the director making the
appointment.
(6) The company shall not be responsible for remunerating the
alternate director.
(7) An alternate director shall be entitled to be reimbursed under
Article 72 as if the alternate director was a director.
85. COMMITTEES
(1) The directors may delegate any of their powers to a committee
or committees consisting of such number of them and/or other
persons as they think fit. A committee may consist of one or
more persons.
(2) A committee to which any powers have been so delegated shall
exercise the powers delegated in accordance with any
directions of the directors. A power so exercised shall be
taken to have been exercised by the directors.
(3) Articles 78, 79, 81 (other than paragraph (3)) and 82 shall
apply to any committee as if each reference in those Articles
to the directors was a reference to the members of the
committee and each reference to a meeting of directors was to
a meeting of the committee.
(4) The number of members whose presence at a meeting of the
committee is necessary to constitute a quorum is the number
determined by the directors and, if not so determined, is 2.
(5) Subject to Article 87, minutes of all the proceedings and
decisions of every committee shall be made, entered and signed
in the same manner in all respects as minutes of proceedings
of the directors are required by the Law to be made, entered
and signed.
86. WRITTEN RESOLUTIONS
(1) If a document:
(a) contains a statement that the signatories to it are in
favour of a resolution;
(b) the terms of the resolution are set out or identified in
the document; and
(c) has been signed by a majority of the directors entitled
to vote on that resolution,
a resolution in those terms shall be taken to have been passed
at a meeting of the directors held on the day on which and at
the time at which the document was last signed by a director
and the document has effect as a minute of the resolution.
(2) For the purposes of paragraph (1):
(a) 2 or more separate documents containing statements in
identical terms each of which is signed by one or more
directors shall together be taken to constitute one
document containing a statement in those terms signed by
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those directors at the time at which the last of those
documents to be signed was signed by a director;
(b) a reference to a majority of the directors does not
include a reference to an alternate director whose
appointor has signed the document, but an alternate
director may sign the document in the place of the
alternate director's appointor; and
(c) a fax which is received by the company or an agent of
the company and is expressed to have been sent for or on
behalf of a director or alternate director shall be
taken to be signed by that director or alternate
director not later than the time of receipt of the
facsimile by the company or its agent in legible form.
87. SINGLE DIRECTOR RESOLUTIONS
Where the board of directors or a committee consists of one person
only, a document signed by that person which records a decision of the
person:
(a) constitutes a decision of the board of directors or
committee as the case may be, and is valid and effective
as if it were a decision made at a meeting of directors
or the committee; and
(b) has effect as a minute of that decision.
88. DEFECTS IN APPOINTMENTS
(1) All acts done by any meeting of the directors, committee of
directors, or person acting as a director are as valid as if
each person was duly appointed and qualified to be a director
or a member of the committee.
(2) Paragraph (1) applies even if it is afterwards discovered that
there was some defect in the appointment of a person to be a
director or a member of a committee or to act as a director or
that a person so appointed was disqualified.
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MANAGING DIRECTOR
89. POWER TO APPOINT MANAGING DIRECTOR
(1) The directors may appoint one or more directors to the office
of managing director for the period and on the terms as they
think fit. Subject to the terms of any agreement entered into
in a particular case, the directors may at any time revoke any
appointment.
(2) A managing director's appointment shall automatically
terminate if the managing director ceases for any reason to be
a director.
90. REMUNERATION
A managing director shall, subject to the terms of any agreement
between the managing director and the company, receive remuneration
(whether by way of salary, commission or participation in profits, or
partly in one way and partly in another) as the directors decide.
91. DELEGATION OF POWERS TO MANAGING DIRECTOR
(1) The directors may, on the terms and conditions and with any
restrictions as they think fit, confer on a managing director
any of the powers exercisable by them.
(2) Any powers so conferred may be concurrent with the powers of
the directors.
(3) The directors may at any time withdraw or vary any of powers
conferred on a managing director.
SECRETARIES AND OTHER OFFICERS
92. SECRETARIES
(1) A secretary of the company holds office on the terms and
conditions, as to remuneration and otherwise, as the directors
decide.
(2) The directors may at any time terminate the appointment of a
secretary.
(3) Where the company has one director only and that director is
also the secretary of the company, the members may terminate
the appointment of the secretary.
93. OTHER OFFICERS
(1) The directors may from time to time:
(a) create any other position or positions in the company
with the powers and responsibilities as the directors
may from time to time confer; and
(b) appoint any person, whether or not a director, to any
position or positions created under paragraph (1)(a).
(2) The directors may at any time terminate the appointment of a
person holding a position created under paragraph (1)(a) and
may abolish the position.
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SEALS
94. SEALS AND THEIR USE
(1) The company may have in addition to its common seal:
(a) a duplicate common seal; and
(b) one or more official seals for use outside the
jurisdiction where the common seal is kept.
(2) A Seal shall be used only by the authority of the directors,
or of a committee of the directors authorised by the directors
to authorise the use of the Seal. Every document to which the
Seal is affixed shall be signed by:
(a) a director and be countersigned by another director, a
secretary or another person appointed by the directors
to countersign that document or a class of documents in
which that document is included; or
(b) where the company has one director only who is also the
sole secretary of the company, by that director in his
capacity as sole director and sole secretary of the
company.
(3) Subject to the Law, certificates in respect of shares or other
securities may be issued either:
(a) under a Seal; or
(b) under the signature of an attorney of the company
appointed under Article 76.
(4) For the purposes of paragraph (3) any impression of any Seal
or any signature may be a facsimile impression or signature
which has been printed, stamped or impressed on the relevant
certificate.
INSPECTION OF RECORDS
95. INSPECTION OF RECORDS
(1) The directors shall decide whether and to what extent, at what
time and places and under what conditions, the accounting and
other records of the company will be open to the inspection of
members.
(2) A member other than a director does not have the right to
inspect any document of the company except as provided by law
or authorised by the directors.
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DIVIDENDS, INTEREST AND RESERVES
96. POWERS TO DECLARE DIVIDENDS AND PAY INTEREST
(1) Subject to the Law and to any special rights or restrictions
attached to any shares, the directors may from time to time
declare Dividends which appear to the directors to be
justified by the profits of the company.
(2) No Dividend shall bear interest against the company.
(3) Subject to the Law, where any shares in the company are issued
for the purposes of raising money to defray the expenses of
the construction of any works or buildings or the provision of
any plant that cannot be made profitable for a long period,
the company may, at the discretion of the directors, pay
interest on so much of that share capital as is for the time
being paid up and charge the interest so paid to capital as
part of the construction or provision.
97. CREDITING OF DIVIDENDS
(1) Subject to any special rights or restrictions attached to any
shares, every Dividend shall:
(a) be paid according to the amounts paid or credited as
paid on the shares in respect of which it is to be paid;
and
(b) be apportioned and paid proportionately to the amounts
paid or credited as paid on the shares in respect of
which the Dividend is to be paid during any part or
parts of the period in respect of which the Dividend is
paid.
(2) An amount paid or credited as paid on a share in advance of a
call shall not be taken for the purposes of paragraph (1) to
be paid or credited as paid on the share.
(3) Subject to any special rights or restrictions attached to any
shares, the directors may from time to time resolve that
Dividends are to be paid out of a particular source or
particular sources, and where the directors so resolve, they
may, in their absolute discretion:
(a) allow each or any member to elect from which specified
sources that particular member's Dividend may be paid by
the company; and
(b) where such elections are permitted and any member fails
to make such an election, the directors may, in their
absolute discretion, identify the particular source from
which Dividends will be payable.
98. DIFFERENTIAL DIVIDENDS
(1) Subject to the rights of persons (if any) entitled to shares
with special rights as to dividend, every dividend shall:
(a) if the resolution for the payment of the dividend so
directs, be paid in respect of some shares to the
exclusion of others but otherwise be paid in respect of
all shares;
(b) if the resolution for the payment of the dividend so
directs, be paid at different rates or in different
amounts on the shares in respect of which it is
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to be paid but otherwise be paid according to the
amounts paid or credited as paid on the shares in
respect of which it is to be paid; and
(c) except where the resolution for the payment of the
dividend otherwise directs or in the case of any share
issued on terms providing that it will rank for dividend
as from a particular date, be apportioned and paid
proportionately to the amounts paid or credited as paid
on the shares in respect of which the dividend is to be
paid during any part or parts of the period in respect
of which the dividend is paid.
(2) An amount paid or credited as paid on a share in advance of a
call shall not be taken for the purposes of paragraph (1) to
be paid or credited as paid on the share.
99. RESERVES
(1) The directors may at any time set aside out of the profits of
the company any sums as they think proper as reserves which
shall, at the discretion of the directors, be applicable for
any purpose to which the profits of the company may be
properly applied.
(2) Pending any application under paragraph (1), the reserves may,
at the discretion of the directors, either be employed in the
business of the company or be invested in any investments as
the directors may from time to time think fit.
(3) The directors may, without placing them to reserve, carry
forward any profits which they may think prudent not to
divide.
100. DEDUCTION OF UNPAID AMOUNTS
The directors may deduct from any Dividend payable to a member all sums
of money presently payable by the member to the company on account of
calls or otherwise in relation to shares in the company.
101. DISTRIBUTIONS IN KIND
(1) The directors may, when declaring a Dividend, by resolution
direct payment of the Dividend wholly or partly by the
distribution of specific assets, including paid up shares in
or debentures of any other body corporate.
(2) Where a difficulty arises in regard to a distribution under
paragraph (1), the directors may:
(a) settle the matter as they think fit and fix the value
for distribution of the specific assets or any part of
those assets;
(b) decide that cash payments will be made to any members on
the basis of the value so fixed in order to adjust the
rights of all parties; or
(c) vest any specific assets in trustees.
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102. PAYMENT OF DISTRIBUTIONS
(1) Any Dividend, interest or other money payable in cash in
respect of shares may be paid, at the sole risk of the
intended recipient:
(a) by cheque sent through the post directed to:
(i) the address of the member
as shown in the register
or, in the case of joint
holders, to the address
shown in the register as
the address of the joint
holder first named in that
register; or
(ii) to any other address as
the member or joint
holders in writing directs
or direct; or
(b) by electronic funds transfer to an account with a bank
or other financial institution nominated by the member
and acceptable to the company; or
(c) by any other means determined by the directors or
otherwise disposed of according to law.
(2) Subject to law, all Dividends unclaimed may be invested or
otherwise used by the directors for the benefit of the company
until claimed.
CAPITALISATION OF PROFITS
103. CAPITALISATION OF PROFITS
(1) The company in general meeting or the directors may resolve:
(a) to capitalize any sum, being the whole or a part of the
amount for the time being standing to the credit of any
reserve account, profit and loss account, share premium
account or otherwise available for distribution to
members; and
(b) that the sum be applied, in any of the ways mentioned in
paragraph (2), for the benefit of members in full
satisfaction of their interest in the capitalised sum,
in the proportions to which those members would have
been entitled in a distribution of that sum by way of
Dividend or, if there is no such proportional
entitlement, as the directors determine.
(2) The ways in which a sum may be applied for the benefit of
members under paragraph (1) are:
(a) in paying up any amounts (including any premiums) unpaid
on shares held by members;
(b) in paying up in full (including any premiums) unissued
shares or debentures or debenture stock to be issued to
members as fully paid;
(c) partly as mentioned in sub-paragraph (a) and partly as
mentioned in sub-paragraph (b);
(d) in accordance with any bonus share plan adopted by the
company; or
(e) any other application permitted by Law.
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(3) Where the conditions of issue of a partly paid share so
provide, the holder shall be entitled to participate in any
application of a sum under paragraph (2) to a greater extent
than would have been the case had those funds been distributed
by Dividend but not to any greater extent than permitted by
the terms of issue.
(4) The directors shall do all things necessary to give effect to
the resolution and, in particular, to the extent necessary to
adjust the rights of the members among themselves, may:
(a) fix the value for distribution of the specific assets or
any part of those assets;
(b) issue fractional certificates or make cash payments in
cases where shares or debentures or debenture stock
become issuable in fractions or determine that fractions
may be disregarded;
(c) vest any cash or specific assets in trustees on trust
for the persons entitled as they think fit; and
(d) authorise any person to make, on behalf of all the
members entitled to any further shares or debentures or
debenture stock on the capitalization, an agreement with
the company providing for the issue to them, credited as
fully paid up, of any further shares or debentures or
debenture stock or for the payment by the company on
their behalf of the amounts or any part of the amounts
remaining unpaid on their existing shares by the
application of their respective proportions of the sum
resolved to be capitalized and any agreement made under
that authority is effective and binding on all the
members concerned.
DIVIDEND REINVESTMENT AND BONUS SHARE PLANS
104. DIVIDEND REINVESTMENT AND BONUS SHARE PLANS
(1) The company in general meeting or the directors may:
(a) establish one or more plans under which some or all
members may elect in terms of one or more of the
following for a period or periods as provided in the
plan:
(i) that Dividends to be paid in respect of some
or all of the shares from time to time held
by the member shall be satisfied by the
issue of fully paid ordinary shares;
(ii) that Dividends shall not be declared or paid
in respect of some or all of the shares from
time to time held by the member, but that the
member will receive an issue of fully paid
ordinary shares paid up out of the company's
share premium account; or
(iii) if elections of either sub-paragraph (a)(i)
or sub-paragraph (a)(ii) are available under
the plan, in terms of sub-paragraph (a)(i)
for some of the shares from time to time held
by the member and in terms of sub-paragraph
(a)(ii) as to the others;
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(b) on or after establishment of any plan extend
participation in it, in whole or in part, to some or all
of the holders of debt obligations of the company in
respect of interest on such obligations in like manner
as if that interest were Dividends; and
(c) vary, suspend or terminate the plan.
(2) Any such plan shall have effect in accordance with its terms
and the directors shall do all things necessary and convenient
for the purpose of implementing the plan, including the making
of each necessary allotment of shares and of each necessary
appropriation, capitalization, application, payment and
distribution of funds which may lawfully be appropriated,
capitalized, applied, paid or distributed for the purpose of
the allotment.
(3) For the purpose of giving effect to any such plan,
appropriations, capitalisation, applications, payments and
distributions as referred to in Article 103 may be made and
the powers of the directors under Article 103(4) shall apply
and may be exercised (with such adjustments as may be
required) even if only some of the members or holders of
shares of any class participate in the appropriations,
capitalization, application, payment or distribution.
(4) In offering opportunities to members to participate in any
such plan, the directors may give such information as in their
opinion may be useful to assist members in assessing the
opportunity and making requests to their best advantage. The
directors, the company and its officers shall not be
responsible for, nor shall they be obliged to provide, any
legal, taxation or financial advice in respect of the choices
available to members.
(5) The directors shall be under no obligation:
(a) to admit any member as a participant in any such plan;
or
(b) to comply with any request made by a member who is not
admitted as a participant in any such plan.
(6) In establishing and maintaining any such plan, the directors
shall act in accordance with the provisions of these Articles
and may exercise all or any of the powers conferred on them by
the terms of any such plan, by these Articles or by the Law.
NOTICES
105. NOTICES GENERALLY
(1) Any member who has not left at or sent to the registered
office a place of address or an electronic mail address (for
registration in the register) at or to which all notices and
documents of the company may be served or sent shall not be
entitled to receive any notice.
(2) A notice may be given by the company to any member by:
(a) serving it on the member personally;
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(b) sending it by post to the member or leaving it at the
member's address as shown in the register or the address
supplied by the member to the company for the giving of
notices;
(c) serving it in any manner contemplated in this paragraph
(2) on a member's attorney as specified by the member in
a notice given under paragraph (3);
(d) facsimile to the facsimile number supplied by the member
to the company for the giving of notices; or
(e) transmitting it electronically to the electronic mail
address given by the member to the company for giving
notices.
(3) A member may by written notice to the secretary left at or
sent to the registered office require that all notices to be
given by the company or the directors be served on the
member's attorney at an address specified in the notice.
(4) Notice to a member whose address for notices is outside
Australia shall be sent by airmail, facsimile or electronic
mail.
(5) Where a notice is sent by post, service of the notice shall be
taken to be effected by properly addressing, prepaying and
posting a letter containing the notice and to have been
effected:
(a) in the case of a notice of a meeting, on the day after
the date of its posting; and
(b) in any other case, at the time at which the letter would
be delivered in the ordinary course of post.
(6) Where a notice is sent by facsimile or electronic
transmission, service of the notice shall be taken to be
effected by properly addressing and sending or transmitting
the notice and to have been effected on the day it is sent.
(7) Proof of service of any notice shall be established by proving
that the envelope or wrapper containing the notice and bearing
the necessary stamps was properly addressed and posted. A
certificate in writing signed by any officer of the company
that the envelope or wrapper was so addressed and posted shall
be conclusive evidence of service.
(8) A notice may be given by the company to a person entitled to a
share in consequence of the death or bankruptcy of a member:
(a) by serving it on the person personally;
(b) by sending it by post addressed to the person by name or
by the title of representative of the deceased or
assignee of the bankrupt or by any like description at
the address (if any) within Australia supplied for the
purpose by the person;
(c) if such an address has not been supplied, at the address
to which the notice might have been sent if the death or
bankruptcy had not occurred;
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Page 39
(d) by sending a facsimile to the facsimile number supplied
by the person to the company;
(e) if such a facsimile number has not been supplied, to the
facsimile number to which the notice might have been
sent if the death or bankruptcy had not occurred; or
(f) by transmitting it to the electronic mail address
supplied by the person to the company.
106. NOTICES OF GENERAL MEETING
(1) Notice of every general meeting shall be given:
(a) in the manner authorised by Article 105:
(i) subject to Article 107, to every member;
(ii) to every person entitled to a share in
consequence of the death or bankruptcy of a
member who, but for death or bankruptcy,
would be entitled to receive notice of the
meeting; and
(iii) to the auditor to the company.
(2) No other person is entitled to receive notice of general
meetings.
JOINT HOLDERS
107. JOINT HOLDERS
(1) Joint holders of a share shall give to the company notice of:
(a) a single address for the purpose of all notices given by
the company under article 105, and for the payment of
dividends and the making of distributions in accordance
with Articles 101 and 103; and
(b) a single account for the payment of monies by electronic
funds transfer in accordance with Article 102(1)(b), if
so desired, in respect of that share.
(2) Where the company receives notice under paragraph (1), the
giving of notice, the payment of dividends or the making of
distributions, to the address or account so notified shall be
deemed given paid or made to all joint holders of the relevant
share.
(3) Where joint holders of a share fail to give notice to the
company in accordance with paragraph (1), the company may give
notice, pay dividends and make distributions to the address of
the joint holder whose name first appears in the register.
(4) Any of the joint holders of a share may give effective receipt
for all dividends and payments in respect of the share.
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WINDING UP
108. WINDING UP
(1) If the company is wound up and the assets available for
distribution among the members are insufficient to repay the
whole of the paid up capital, the assets shall be distributed
so that, as nearly as may be, the losses shall be borne by the
members in proportion to the capital paid up, or which ought
to have been paid up, at the commencement of the winding up,
on the shares held by them respectively.
(2) If, in a winding up, the assets available for distribution
among the members are more than sufficient to repay the whole
of the capital paid up at the commencement of the winding up,
the excess shall be distributed among the members in
proportion to the capital at the commencement of the winding
up paid up, or which ought to have been paid up, on the shares
held by them respectively.
(3) If the company is wound up, the liquidator may:
(a) with the sanction of a special resolution, divide among
the members in kind the whole or any part of the
property of the company;
(b) for that purpose set a value as the liquidator considers
fair on any property to be so divided; and
(c) decide how the division is to be carried out as between
the members or different classes of members.
(4) The liquidator may, with the sanction of a special resolution,
vest the whole or any part of any property in trustees on any
trusts for the benefit of the contributories as the liquidator
thinks fit, but so that no member is compelled to accept any
shares or other securities in respect of which there is any
liability.
INDEMNITY
109. INDEMNITY AND INSURANCE
(1) To the extent permitted by law and without limiting the powers
of the company, the company must indemnify each person who is,
or has been, a director or secretary of the company against
any liability which results directly or indirectly from facts
or circumstances relating to the person serving or having
served in that capacity in relation to the company or any of
its subsidiaries or in the capacity of an employee of the
company or any of its subsidiaries:
(a) to any person (other than the company or a related body
corporate), which does not arise out of conduct
involving a lack of good faith or conduct known to the
person to be wrongful;
(b) for costs and expenses incurred by the person in
defending proceedings, whether civil or criminal, in
which judgment is given in favour of the person or in
which the person is acquitted, or in connection with any
application in relation to such proceedings in which the court
grants relief to the person under the Law.
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Page 41
(2) The company need not indemnify a person as provided for in
paragraph (1) in respect of a liability to the extent that the
person is entitled to an indemnity in respect of that
liability under a contract of insurance.
(3) To the extent permitted by law and without limiting the powers
of the company, the board of directors may authorise the
company to, and the company may enter into any:
(a) documentary indemnity in favour of; or
(b) insurance policy for the benefit of,
a person who is, or has been, a director, secretary, auditor,
employee or other officer of the company or of a subsidiary of
the company, which indemnity or insurance policy may be in
such terms as the board of directors approves and, in
particular, may apply to acts or omissions prior to or after
the time of entering into the indemnity or policy;
(4) The benefit of each indemnity given in paragraph (1)
continues, even after its terms or the terms of this paragraph
are modified or deleted, in respect of a liability arising out
of acts or omissions occurring prior to the modification or
deletion.
* * * *
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I agree to the Articles of Association.
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Signature of subscriber Witness
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Ian Brian HOPKINS Donna Marie Anne DECLASE
Level 17, The Chifley Tower
2 Chifley Square, Sydney NSW 2000
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DATED this day of , 1998.
<PAGE>
CONFORMED COPY
EXHIBIT 10.1
------------
WESTPAC BANKING CORPORATION
(Westpac)
THE MORTGAGE COMPANY PTY LIMITED
(Servicer)
WESTPAC SECURITIES ADMINISTRATION LIMITED
(Trustee)
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WESTPAC SECURITISATION TRUSTS
SERVICING AGREEMENT
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(C) Allen Allen & Hemsley
Sydney
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T A B L E O F C O N T E N T S
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1. DEFINITIONS AND INTERPRETATION ............................. 1
1.1 Definitions ....................................... 1
1.2 Interpretation .................................... 3
1.3 Limitation of Trustee's Liability ................. 3
1.4 Series Notice ..................................... 4
2. APPOINTMENT OF SERVICER .................................... 4
2.1 Appointment ....................................... 4
2.2 General duties and standard of care ............... 4
2.3 Powers ............................................ 4
2.4 Records ........................................... 5
2.5 Servicer's power to delegate ...................... 5
2.6 Servicer's power to appoint advisers .............. 6
2.7 Legal title ....................................... 6
2.8 License to enter Premises ......................... 6
3. DUTIES AND RESPONSIBILITIES OF THE SERVICER AS CUSTODIAN ... 6
3.1 General ........................................... 6
3.2 Locate and Access ................................. 7
3.3 Audit ............................................. 7
3.4 Transfer of Custody ............................... 8
4. UNDERTAKINGS ............................................... 8
4.1 Servicing Undertakings ............................ 8
4.2 Westpac Undertakings ..............................11
4.3 Westpac's power to delegate .......................12
4.4 Adverse Effect ....................................13
5. PROCEDURES MANUAL ..........................................13
5.1 Trustee bound by acts of Servicer .................13
5.2 No liability for compliance .......................13
5.3 Amendments to Procedures Manual ...................13
6. COLLECTION AND REMITTANCE OF MONEYS ........................14
6.1 Collection of moneys ..............................14
6.2 Remittances .......................................14
6.3 Remittances to Trustee ............................15
6.4 Payments and Computations, etc. ...................15
6.5 Report by Servicer ................................15
6.6 No Right of Set-Off ...............................15
7. SERVICER FEES ..............................................15
7.1 Fee .............................................. 15
7.2 Expenses of Servicer and Westpac 16
8. TERMINATION............................................... 16
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Page (ii)
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8.1 Expiry of Term................................... 16
8.2 Servicer Transfer Event.......................... 16
8.3 Resignation...................................... 17
8.4 Survival......................................... 17
8.5 Release of outgoing Servicer..................... 17
8.6 New Servicer to execute deed..................... 17
8.7 Settlement and discharge......................... 17
9. INDEMNITY................................................. 17
9.1 Indemnity........................................ 17
9.2 Limitation of liability.......................... 18
9.3 No liability for acts of certain persons......... 18
9.4 No liability for loss etc........................ 18
9.5 Method of claiming under indemnity............... 18
9.6 Time of Payment.................................. 19
10. REPRESENTATIONS AND WARRANTIES............................ 19
10.1 Representations and Warranties................... 19
10.2 Reliance......................................... 19
10.3 Survival of Representations and Indemnities...... 19
11. WESTPAC AND THE SERVICER MAY ACT AS BANKER................ 19
12. ADMINISTRATIVE PROVISIONS................................. 20
12.1 Notices.......................................... 20
12.2 Governing Law and Jurisdiction................... 20
12.3 Assignment....................................... 20
12.4 Amendment........................................ 20
12.5 Severability Clause.............................. 20
12.6 Costs and Expenses............................... 20
12.7 Waivers: Remedies Cumulative.................... 21
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CONFORMED COPY
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SERVICING AGREEMENT
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AGREEMENT dated 18 February 1997 between
1. WESTPAC BANKING CORPORATION (ARBN 007 457 141) incorporated in New
South Wales of 60 Martin Place, Sydney in its capacity as an Approved
Seller (Westpac);
2. THE MORTGAGE COMPANY PTY LIMITED (ACN 070 968 302) incorporated in the
Australian Capital Territory of Level 6, 228 Pitt Street, Sydney (the
Servicer); and
3. WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472)
incorporated in New South Wales of Level 9, 66 Pitt Street, Sydney (the
Trustee).
RECITALS
A. The Trustee wants to retain the services of the Servicer to manage the
Receivables in relation to certain Trusts and provide custodial
services in relation to the Relevant Documents.
B. The Trustee wants Westpac to undertake various matters in relation to
the Receivables and Receivable Rights that it sells to the Trustee for
so long as Westpac holds legal title to those Receivables and
Receivable Rights.
IT IS AGREED as follows
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Agreement, terms defined in the Master Trust Deed or a Series
Notice in relation to a Relevant Trust have the same meaning and the
following definitions apply unless a different meaning is given in a
Series Note in relation to a Relevant Trust or the context otherwise
requires.
Audit Date means a date not later than the first anniversary of the
date of this Agreement and every 12 months after that date during the
Term.
Custody Transfer Trigger means a Further Audit resulting in an adverse
report.
Eligible Servicer means any suitably qualified person whose appointment
by the Trustee as Servicer under this Agreement will not materially
prejudice the interests of the Noteholders.
Further Audit has the meaning given in Clause 3.3(c).
Law means any statute, rule, regulation, ordinance, order or decree of
any Governmental Agency, and includes, without limitation the Consumer
Credit Code and the Code of Banking Practice.
Master Trust Deed means the Master Trust Deed between the Trustee and
the Servicer (in its capacity as Trust Manager) dated on or about the
date of this Agreement.
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Material Default means, with respect to a Receivable:
(a) a failure by an Obligor to pay any amount pursuant to the
relevant Receivable which failure causes the Receivable to be
in Arrears and which failure to pay continues for a period of
90 days; or
(b) the occurrence of an event of default, howsoever described
(other than a failure by an Obligor to pay an amount under the
relevant Receivable) under that Receivable or Receivable
Security unless the Servicer reasonably determines that such
event of default is of a minor or technical nature and will
not result in an Adverse Effect.
Premises means the Mortgage Processing Centre at 25 Pierson Street,
Lockleys, South Australia or such other premises as the Servicer
proposes, and the Trustee agrees to in writing (such agreement not to
be unreasonably withheld where the proposed premises are to be used as
a document vault, and those premises have security to a standard at
least equal to the Mortgage Processing Centre).
Procedures Manual means, in relation to a Portfolio of Receivables,
those policies and procedures of Westpac or the Servicer (as the case
may be) relating to the origination, management and enforcement of
those Receivables, Receivable Securities and Related Securities as
those policies and procedures are amended in accordance with this
Agreement, and applied from time to time in Westpac's or the Servicer's
ordinary course of business (as the case may be).
Receivable has the meaning in the Master Trust Deed, but relates only
to Receivables held by the Trustee under a Relevant Trust.
Receivable Securities has the meaning in the Master Trust Deed, but
relates only to Receivable Securities held by the Trustee under a
Relevant Trust.
Receivables Register means a register of Receivables for each Trust and
Warehouse Trust maintained by the Servicer and stored on computer disk
or other electronic form. In relation to Mortgages it shall contain the
information in respect of each Mortgage set out in Schedule 1.
Record of Movements has the meaning given in Clause 3.1(c).
Relevant Trust means a Trust in relation to which the Servicer has been
appointed, and has agreed to act, as Servicer under Clause 2.1(a) and a
Series Notice.
Security Packet means, in relation to a Receivable, each packet of
Relevant Documents relating to that Receivable.
Security Packet Audit means, at any time, an inventory of Security
Packets conducted by the Servicer to verify location of the Security
Packets.
Security Vault means any security document vault located on the
Premises in which any Security Packets or Relevant Documents are
stored.
Services means the services provided or to be provided by the Servicer
under this Agreement.
Servicer Transfer Event means the occurrence of any of the following:
(a) an Insolvency Event occurs with respect to the Servicer;
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(b) the Servicer fails to pay any amount in accordance with any
Transaction Document within 10 Business Days of receipt of a
notice to do so from either the Trustee or Trust Manager;
(c) the Servicer fails to comply with any of its other obligations
under any Transaction Document and such action has had, or, if
continued will have, an Adverse Effect (as determined by the
Trustee) and the Servicer does not remedy that failure within
30 days after the Servicer becomes aware of that failure by
receipt of a notice from either the Trustee or the Trust
Manager;
(d) any representation, warranty or certification made by the
Servicer is incorrect when made and is not waived by the
Trustee or remedied to the Trustee's reasonable satisfaction
within 90 days after notice from the Trustee, and the Trustee
determines that breach would have an Adverse Effect; or
(e) if it is unlawful for the Servicer to perform the Services.
Term means the period from the date of this Agreement until the earlier
of:
(a) the date on which this Agreement is terminated pursuant to
Clause 8.2;
(b) the date which is one month after the Notes in relation to
each Relevant Trust have been redeemed in full in accordance
with the Transaction Documents and the Trustee ceases to have
any obligations to any Creditor in relation to any Trust;
(c) the date on which the Trustee replaces the Servicer with an
Eligible Servicer; and
(d) the date on which the Servicer is replaced after resigning
under Clause 8.3.
1.2 Interpretation
The provisions of clause 1.2 of the Master Trust Deed apply to this
Agreement, as if set out in full, and on the basis that a reference in
Clause 1.2(e) or (f) to "this Deed" is a reference to this Agreement.
1.3 Limitation of Trustee's Liability
(a) The Trustee enters into this Agreement only in its capacity
as trustee of each Relevant Trust and in no other capacity. A
liability arising under or in connection with this Agreement
can be enforced against the Trustee only to the extent to
which it can be satisfied out of property of the Relevant
Trust out of which the Trustee is actually indemnified for
the liability. This limitation of the Trustee's liability
applies despite any other provision of this Agreement (other
than Clause 1.3(c)) and extends to all liabilities and
obligations of the Trustee in any way connected with any
representation, warranty, conduct, omission, agreement or
transaction related to this Agreement.
(b) The parties other than the Trustee may not sue the Trustee
personally or seek the appointment of a liquidator,
administrator, receiver or similar person to the Trustee or
prove in any liquidation, administration or arrangement of or
affecting the Trustee.
(c) The provisions of this Clause 1.3 shall not apply to any
obligation or liability of the Trustee to the extent that
obligation or liability is not satisfied because:
(i) under the trust deed establishing the Trust; or
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Page 4
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(ii) by operation of law,
there is a reduction in the extent, or extinguishment, of the
Trustee's indemnification out of the assets of the Relevant
Trust, as a result of the Trustee's fraud, negligence or
breach of trust.
(d) It is acknowledged that the Trust Manager of the Relevant
Trust is responsible under the Master Trust Deed for a variety
of obligations relating to the Trust, including under this
Agreement. No act or omission of the Trustee (including any
related failure to satisfy its obligations under this
agreement) will be considered fraud, negligence or breach of
trust of the Trustee for the purpose of Clause 1.3(c) to the
extent to which the act or omission was caused or contributed
to by any failure by the Trust Manager or the Servicer or any
other person properly appointed by the Trustee, the Trust
Manager or the Servicer to fulfil its obligations relating to
the Relevant Trust or by any other act or omission of the any
other person properly appointed by the Trustee, the Trust
Manager or the Servicer.
(e) No attorney, agent, receiver or receiver and manager appointed
in accordance with this Agreement has authority to act on
behalf of the Trustee in a way which exposes the Trustee to
any personal liability and no act or omission of any such
person will be considered fraud, negligence or breach of trust
of the Trustee for the purpose of Clause 1.3(c).
1.4 Series Notice
This Agreement is subject to the Series Notice for each Relevant Trust.
In case of any inconsistency, the Series Notice shall prevail.
2. APPOINTMENT OF SERVICER
2.1 Appointment
The Trustee appoints the Servicer to perform the Services during the
Term for each Trust in relation to which the Servicer is specified as,
and agrees to act as, the Servicer in the relevant Series Notice. By
executing a Series Notice, the Servicer shall be taken to have accepted
that appointment, and agreed to perform the Services in relation to
that Trust in accordance with this Agreement.
2.2 General duties and standard of care
The Servicer shall manage and service the Receivables:
(a) in accordance with this Agreement;
(b) to the extent not provided in this Agreement, in accordance
with the applicable Procedures Manual as that is interpreted
and applied by the Servicer in the ordinary course of its
business; and
(c) to the extent not covered by Clauses 2.2(a) and (b), by
exercising the degree of diligence and care expected of an
appropriately qualified Servicer of the relevant financial
products and custodian of documents.
2.3 Powers
Subject to Clauses 2.2, 4.1(g) and 4.4, the Servicer has the express
power, among other things, to the extent such action will not cause an
Adverse Effect (that is, an event which will
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Page 5
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materially and adversely affect the amount of any payment to be made to
any Noteholder, or will materially and adversely affect the timing of
such payment):
(a) to waive any fees and break costs which may be collected in
the ordinary course of servicing the Receivables or arrange
the rescheduling of interest due and unpaid following a
default under any Receivables;
(b) in its discretion, to waive any right in respect of any
Receivables and Receivable Securities in the ordinary course
of servicing the Receivables and Receivable Securities
(including in accordance with its normal collection
procedures); and
(c) to grant an extension of maturity beyond 30 years from the
date any Receivable that relates to a mortgage loan was made,
when required to do so by Law or a Government Agency. The
restriction on granting extensions that will not have an
Adverse Effect shall not apply where the extension is required
by Law or a Governmental Agency.
2.4 Records
(a) The Servicer will maintain the Data Base used by it as a
master record of Receivables and Receivable Securities in
relation to each Relevant Trust.
(b) Each Receivable will be electronically tagged so that all
related Collections and performance statistics (the nature of
which shall be as mutually agreed from time to time by the
Servicer, the Trust Manager and the Trustee) for that
Receivable can be readily identified.
2.5 Servicer's power to delegate
Without in any way affecting the generality of the above, the Servicer
may in carrying out and performing its duties and obligations contained
in this Agreement:
(a) (delegate to employees agent) delegate to any of its officers
and employees all Services (whether or not requiring or
involving the Servicer's judgment or discretion);
(b) (appoint attorneys or subcontract) appoint any person to be
its attorney or agent or delegate to or subcontract with any
person for such purposes and with such powers, authorities and
discretions (not exceeding those vested in the Servicer) as
the Servicer thinks fit with:
(i) power for the attorney or agent to sub-delegate any
such powers, authorities or discretions;
(ii) power to authorise the issue in the name of the
Servicer of documents bearing facsimile signatures of
the Servicer or of the attorney, agent or delegate
(either with or without proper manuscript signatures
of their officers); and
(iii) provisions for the protection and convenience of
those dealing with any such attorney, agent or
delegate as they may think fit; and
(c) (suspend agents and sub-agents) supersede or suspend any such
attorney, agent or delegate for such cause or reason as the
Servicer may in its sole discretion think sufficient with or
without assigning any cause or reason and either absolutely or
for such time as it may think proper,
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but despite any delegation or appointment under the above paragraphs of
this Clause, the Servicer shall remain liable for the performance of
the Services in accordance with this Agreement and for the acts or omis
sions of any officer, employee, attorney, agent, delegate, sub-delegate
or sub-agent and shall be solely responsible for the fees and expenses
of such officer, employee, attorney, agent, delegate, sub-delegate or
sub-agent.
2.6 Servicer's power to appoint advisers
In accordance with its ordinary course of business, the Servicer may
appoint and engage and act upon the opinion, advice or information
obtained from any valuers, solicitors, barristers, accountants,
surveyors, property managers, real estate agents, contractors,
qualified advisers and such other persons as may be necessary, usual or
desirable for the purpose of enabling the Servicer properly to exercise
and perform its duties and obligations under this Agreement.
2.7 Legal title
The Servicer agrees that upon being directed to do so by the Trustee
following a Title Perfection Event for a Relevant Trust, it will
promptly take all action to perfect the Trustee's legal title to the
relevant Receivables and Receivable Securities by:
(a) giving written notice of the Trustee's interest to any Obligor
or Mortgagor;
(b) registering any Transfer of Receivable Security;
(c) taking any other action required or permitted by law to
perfect such legal title; and
(d) delivering all Relevant Documents for that Trust to the
Trustee. If the Servicer has not done so within 10 Business
Days (or such longer period as the Trustee permits) the
Trustee may enter any premises where those Relevant Documents
are kept, take possession of and remove those Relevant
Documents. The Servicer shall assist the Trustee in doing so.
2.8 License to enter Premises
Westpac irrevocably licenses the Trustee to enter onto the Premises for
the purpose of taking possession of, and removing, the Relevant
Documents in accordance with this Agreement.
3. DUTIES AND RESPONSIBILITIES OF THE SERVICER AS CUSTODIAN
3.1 General
The Servicer's duties and responsibilities (in its capacity as
custodian under this Agreement) are to:
(a) hold as custodian under this Agreement at the direction of the
Trustee each Relevant Document that it may receive on behalf
of the Trustee (or its agent or nominee) pursuant to a
Transaction Document in accordance with its standard
safekeeping practises and in the same manner and to the same
extent as it holds similar documents for Westpac;
(b) ensure that each Relevant Document is capable of
identification and is kept in a Security Packet which is kept
together with other Security Packets relating to the
Receivables of that Trust in a security vault, and separate
from other documents held by the Servicer for another Trust or
otherwise;
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(c) in relation to each Relevant Trust, open and maintain in safe
custody a record of physical movement from the Premises and
between each Relevant Trust of any Relevant Document held by
it from time to time pursuant to this Agreement (the Record of
Movements);
(d) update the Receivables Register and give a copy to the
Trustee:
(i) within 3 months of the Closing Date for each Relevant
Trust;
(ii) if its holding company has a short term rating from
the Designated Rating Agency of not less than A-, not
later than the last Business Day of each calendar
year during the Term;
(iii) if its holding company does not have such a rating,
on the last Business Day of each calendar quarter
during the Term; and
(iv) within 30 days of a written request by the Trustee if
the Trustee (in its discretion, but acting
reasonably) believes that the Servicer or Westpac is
breaching its obligations under this Agreement or any
other Relevant Document; and
(e) at all times during the currency of this Agreement do all
acts, matters and things which may reasonably be required of
the Servicer by the Trustee for the purposes of, or as
contemplated by this Agreement.
3.2 Locate and Access
(a) The Servicer shall ensure that at all times it shall be able
to locate each Security Packet by way of a periodic Security
Packet Audit.
(b) Unless the Servicer requires a Relevant Document to perform
its duties as Servicer in relation to the related Receivable,
or otherwise comply with its obligations under the Transaction
Documents, each Relevant Document shall be kept within the
Security Vault.
(c) Other than the Servicer requiring a Relevant Document under
Clause 3.2(b), or for an audit by Westpac's or the Servicer's
internal or external auditor, or by the Auditor under Clause
3.3 of this Agreement, a Relevant Document may only be removed
from the Security Vault with the Trustee's written approval
and for the following purposes:
(i) inspection by the Trustee; or
(ii) such other purpose approved in writing by the
Trustee.
3.3 Audit
(a) The Trust Manager or the Trustee (in default of action by the
Trust Manager) shall on each Audit Date request an independent
auditor to conduct an audit of the Servicer's custodial role
with respect to the Relevant Documents for any Relevant Trust
by considering the matters set out in Schedule 2.
(b) The terms of the instruction of that auditor must require
delivery, within one month of an Audit Date, of a certificate
addressed to the Trustee, the Servicer and the Designated
Rating Agency stating whether or not the Servicer has complied
with the matters set out in Schedule 2.
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(c) Where a certificate referred to in Clause 3.3(b) (the Audit
Certificate) gives an "Adverse" finding (as set out in
Schedule 2), the Trustee must direct that auditor to conduct a
further audit (the Further Audit) on a similar basis to the
audit to which the Audit Certificate related. The Further
Audit shall be conducted no later than one month after the
date of the Audit Certificate. That auditor shall then issue a
new certificate with respect to the Further Audit in the form
required by Clause 3.3(b) no later than one month after the
date on which the Further Audit commenced.
(d) Subject to any bona fide confidentiality restrictions, the
Servicer shall give each auditor full access to all relevant
information and the Relevant Documents for the purpose of
conducting each audit under Clause 3.3.
(e) The Trustee shall pay the reasonable fees and expenses of the
auditor with respect to any audit under this Clause 3.3.
(f) The auditor instructed under this Clause must be instructed to
give written reasons supporting any "Adverse" finding.
(g) The Servicer shall take all reasonable steps to cure any non
compliance identified by an audit.
3.4 Transfer of Custody
If:
(a) a Servicer Transfer Event occurs and is subsisting; or
(b) a Custody Transfer Trigger occurs,
the Servicer must deliver the Relevant Documents to the Trustee, or as
it directs. If the Servicer has not done so within 10 Business Days (or
such longer period as the Trustee permits) the Trustee must enter any
premises where the Relevant Documents are kept, take possession of and
remove the Relevant Documents. The Servicer shall assist in doing so.
If the Trustee does not have possession of the Relevant Documents
within that period it may, to the extent that it has information
available to it to do so, lodge caveats in relation to and/or take all
other action it considers necessary to protect its interests in, the
Receivables and Receivable Securities for which it does not hold the
Relevant Documents.
4. UNDERTAKINGS
4.1 Servicing Undertakings
The Servicer undertakes that at all times during the Term it will:
(a) (notice of default) give notice in writing to the Trustee and
the Designated Rating Agency of it becoming aware of the
occurrence of any Servicer Transfer Event;
(b) (compliance with law)
(i) maintain in effect all qualifications, consents,
licenses, permits, approvals, exemptions, filings and
registrations as may be required under any applicable
law in order properly to service the Receivables and
Receivable Securities and to perform or comply with
its obligations under this Agreement; and
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(ii) comply with all Laws in connection with servicing the
Receivables and Receivable Securities where failure
to do so would have an Adverse Effect;
(c) (Collections)
(i) in relation to Receivables of which Westpac is the
legal owner, on request from Westpac, assist Westpac
to collect all moneys due under those Receivables and
the Receivable Securities; and
(ii) in relation to Receivables of which the Trustee is
the legal owner, collect all moneys due under those
Receivables and Receivables Securities,
in accordance with the standards specified in Clause 2.2, and
pay them into the relevant Collections Account not later than
the time that Westpac would be required to do so under Clause
6.
(d) (Material Default) if a Material Default occurs in respect to
a Receivable, take such action in accordance with the
Servicer's normal enforcement procedures to enforce the
relevant Receivable and the Receivable Security to the extent
that the Servicer determines that enforcement procedures
should be taken;
(e) (Insurance Policies)
(i) act in accordance with the terms of any Mortgage
Insurance Policies;
(ii) not do or omit to do anything which could be
reasonably expected to prejudicially affect or limit
its rights or the rights of the Trustee under or in
respect of a Mortgage Insurance Policy to the extent
those rights relate to a Receivable and the
Receivable Security;
(iii) promptly make a claim under any Mortgage Insurance
Policy when it is entitled to do so; and
(iv) promptly notify the Trust Manager when each such a
claim is made.
(f) (no Security Interests) not consent to the creation or
existence of any Security Interest in favour of a third party
in relation to any Mortgaged Property in connection with a
Receivable and the Receivable Security:
(i) without limiting paragraph (f)(ii), unless priority
arrangements are entered into with that third party
under which the third party acknowledges that the
Receivable and Receivable Security ranks ahead in
priority to the third party Security Interest on
enforcement for an amount not less than the Unpaid
Balance of the Receivable plus such other amount as
the Servicer determines in accordance with the
Procedures Manual or its ordinary course of business;
or
(ii) which would rank before or pari passu with the
relevant Receivable and Receivable Security;
(g) (release of debt or vary terms) not, except as required by
Law, release an Obligor from any amount owing in respect of a
Receivable or otherwise vary or discharge any Receivable or
Receivable Security or enter into any agreement or arrangement
which has the effect of altering the amount payable in respect
of a Receivable or Receivable Security where it would have an
Adverse Effect;
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(h) (binding provisions and orders of a competent authority)
release any Receivable or Receivable Security, reduce the
amount outstanding under or vary the terms of any Receivable
or grant other relief to an Obligor, if required to do so by
any Law or if ordered to do so by a court, tribunal,
authority, ombudsman or other entity whose decisions are
binding on the Servicer. If the order is due to the Servicer
breaching any applicable Law then the Servicer must indemnify
the Trustee for any loss the Trustee may suffer by reason of
the order. The amount of the loss is to be determined by
agreement with the Trustee or failing this, by the Servicer's
external auditors;
(i) (other miscellaneous things) attend to the stamping and
registration of all Relevant Documents for each Relevant
Trust (including documents which became Relevant Documents)
following any amendment, consolidation or other action, and
in the case of any registration of any Mortgage that
registration must result in the Mortgage having the ranking
referred to in the relevant eligibility criteria in the
Series Notice. In relation to any Mortgage that is not
registered at the relevant Closing Date, the Servicer shall
ensure that it is lodged for registration not later than
120 days after that Closing Date;
(j) (setting the Interest Rate)
(i) the Servicer shall set the interest rate on the
Receivables in accordance with the requirements of
the Series Notice; and
(ii) subject to the relevant Series Notice, if the Trustee
has perfected its title to the Receivables or
Receivable Securities and the Trustee is entitled to
vary the interest rate in accordance with the terms
of the Receivables, the Servicer shall, in accordance
with the terms of the Receivables, set and maintain
the interest rate on the relevant Receivables at or
above the relevant Threshold Rate as advised by the
Trust Manager in accordance with the Master Trust
Deed and the Series Terms and promptly notify the
relevant Obligors;
(k) (notification) notify:
(i) the Trustee and the Trust Manager of any event which
it reasonably believes is likely to have an Adverse
Effect promptly after becoming aware of such event;
and
(ii) the Trust Manager of anything else which the Trust
Manager reasonably requires regarding any proposed
modification to any Receivable or Receivable
Security.
(l) (provide information and access on request) provide
information reasonably requested by the Trustee or the Trust
Manager, with respect to all matters relating to each Relevant
Trust and the assets of the relevant Trust, and the Trustee or
the Trust Manager believes reasonably necessary for it to
perform its obligations under the relevant Transaction
Documents, and upon reasonable notice and at reasonable times
permit the Trustee to enter the Premises and inspect the Data
Base in relation to each Relevant Trust and the Relevant
Documents;
(m) (comply with other obligations) comply with all its
obligations under any Transaction Document to which it is a
party, where a failure to do so would result in an Adverse
Effect;
(n) (pay taxes) subject to receiving payment from, or being
reimbursed by, the relevant Obligor or being indemnified by
the Trustee, pay all Taxes that relate to the
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Services (other than any Tax on the income of a Trust) or
ensure those Taxes are paid or where such Taxes are incurred
due to the default or breach of duty by the Servicer;
(o) (not claim) not claim any Security Interest over any Asset;
(p) (availability of Data Base) make the Data Base that relates to
the Services available for inspection by the Trustee at any
reasonable time;
(q) (comply with Series Notice) comply with any undertaking
specified as an additional Servicer undertaking in a relevant
Series Notice, including, without limitation, providing the
Trust Manager with any information referred to in that Series
Notice;
(r) (insurances) ensure that the Premises are appropriately
insured for fire and public risks, and that it has appropriate
directors and officers insurance;
(s) (additional amounts) notify Westpac and the Trust Manager
immediately of each request by an Obligor to borrow further
moneys under or in relation to a Receivable or Receivable
Security which is a "top-up" and which the Servicer has
approved; and
(t) (comply with Trust Back) apply any moneys it receives in
relation to any Other Secured Liability in accordance with the
relevant Trust Back in accordance with the directions of the
Trustee.
4.2 Westpac Undertakings
Westpac undertakes that at all times during the Term, and for so long
as it is the legal owner of any Receivable or Receivable Security, it
will:
(a) (compliance with law)
(i) maintain in effect all qualifications, consents,
licences, permits, approvals, exemptions, filings and
registrations as may be required under any applicable
Law in relation to its ownership of any Receivable or
Receivable Security and to perform or comply with its
obligations under this Agreement; and
(ii) comply with all Laws in connection with its ownership
of any Receivables and Receivable Securities where
failure to do so would have an Adverse Effect;
(b) (co operate with the Servicer) co operate with the Servicer in
relation to the performance by the Servicer of the Services
including, without limitation, in relation to the enforcement
of any Receivable or Receivable Security;
(c) (comply with Series Notice) comply with any undertaking
specified in relation to it in a relevant Series Notice,
including, without limitation, providing the Trust Manager
with any information referred to in that Series Notice;
(d) (Material Default) if a Material Default occurs in respect to
a Receivable, take such action as the Servicer directs it to
take in accordance with this Agreement;
(e) (Insurance Policies) act in accordance with the terms of any
Mortgage Insurance Policies, and not do or omit to do anything
which could be reasonably expected to
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prejudicially affect or limit the rights of the Trustee under
or in respect of a Mortgage Insurance Policy to the extent
those rights relate to a Receivable and the Receivable
Security;
(f) (no Security Interests) not consent to the creation or
existence of any Security Interest in favour of a third party
in relation to any Mortgaged Property in connection with a
Receivable and the Receivable Security:
(i) without limiting paragraph (f)(ii), unless priority
arrangements are entered in to with that third party
under which the third party acknowledges that the
Receivable and Receivable Security ranks ahead in
priority to the third party Security Interest on
enforcement for an amount not less than the Unpaid
Balance of the Receivable plus such other amount as
the Servicer determines in accordance with the
Procedures Manual or its ordinary course of business;
or
(ii) which would rank before or pari passu with the
relevant Receivable and Receivable Security;
(g) (release of debt or vary terms) not, except as required by
Law, release an Obligor from any amount owing in respect of a
Receivable or otherwise vary or discharge any Receivable or
Receivable Security or enter into any agreement or arrangement
which has the effect of altering the amount payable in respect
of a Receivable or Receivable Security where it would have an
Adverse Effect;
(h) (binding provisions and orders of a competent authority)
release any Receivable or Receivable Security, reduce the
amount outstanding under or vary the terms of any Receivable
or grant other relief to an Obligor, if required to do so by
any Law or if ordered to do so by a court, tribunal,
authority, ombudsman or other entity whose decisions are
binding on Westpac. If the order is due to Westpac breaching
any applicable Law then Westpac must indemnify the Trustee for
any loss the Trustee may suffer by reason of the order. The
amount of the loss is to be determined by agreement with the
Trustee or failing this, by Westpac's external auditors;
(i) (not claim) not claim any Security Interest over any Asset;
and
(j) (additional amounts) notify the Servicer immediately of each
request by an Obligor to borrow further moneys under or in
relation to a Receivable or Receivable Security.
4.3 Westpac's power to delegate
(a) For so long as Westpac is the legal owner of any Receivables,
and Westpac is required by Law (including, without limitation,
the Consumer Credit Code) to do, or refrain from doing,
certain things in relation to those Receivables or the
Receivable Securities:
(i) Westpac appoints the Servicer to do those things on
its behalf, except as specified in the Procedures
Manual;
(ii) Westpac directs the Servicer to perform the Services
in a manner that is consistent with any obligation of
Westpac under any Law;
(iii) Westpac authorises the Servicer to conduct
correspondence with Obligors and other persons as if
it had been appointed to perform the Services by
Westpac as legal owner of those Receivables and
Receivable Securities,
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but this authorisation is subject to any restriction
imposed on the Servicer in any power of attorney or
the Procedures Manual; and
(iv) the Servicer accepts that appointment and direction
and agrees to perform the Services in accordance with
this Agreement.
(b) Despite any delegation under this Clause, Westpac shall remain
liable in relation to any obligation it delegates to the
Servicer, and for the acts, omissions, fees and expenses of
the Servicer as its delegate.
4.4 Adverse Effect
(a) In performing the Services the Servicer shall have regard to
whether what it does, or does not do, will have any Adverse
Effect.
(b) The Servicer may ask the Trustee or the Trust Manager if any
action or inaction on its part is reasonably likely to, or
will, have an Adverse Effect.
(c) The Servicer may rely upon any statement by the Trustee or the
Trust Manager that any action or inaction by the Servicer is
reasonably likely to, or will, have an Adverse Effect.
(d) Subject to paragraph (a), the Servicer shall not be liable for
a breach of this Agreement, or be liable under ^ any
indemnity, in relation to any action or inaction on its part,
where it has been notified by the Trustee or the Trust Manager
that the action or inaction is not reasonably likely to, or
will not have an Adverse Effect.
5. PROCEDURES MANUAL
5.1 Trustee bound by acts of Servicer
All acts of the Servicer in servicing the Receivables in accordance
with the relevant Procedures Manual are binding on the Trustee.
5.2 No liability for compliance
(a) The Servicer is not in breach of its duties under this
Agreement or otherwise liable to the Trustee if it complies
strictly with the relevant Procedures Manual unless:
(i) the relevant Procedures Manual does not materially
comply with any Law; or
(ii) the Servicer is not otherwise complying with
Clauses 2.2 and 4 in relation to the relevant
matter or duty.
(b) If the Servicer becomes aware that any Procedures Manual does
not materially comply with any Law, it shall notify the
Trustee within 10 Business Days and take all reasonable steps
to rectify that non-compliance.
5.3 Amendments to Procedures Manual
The Servicer shall not amend the relevant Procedures Manual in any way
that would reasonably be expected to result in an Adverse Effect,
unless it must do so to ensure compliance with Law. The Servicer shall
notify the Trustee, the Trust Manager and the Designated Rating Agency
of any material amendment to the relevant Procedures Manual.
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6. COLLECTION AND REMITTANCE OF MONEYS
6.1 Collection of moneys
(a) Westpac shall on behalf of the Trustee collect and receive the
Collections in respect of Receivables in relation to which
Westpac is the legal owner.
(b) In collecting and receiving the Collections for Receivables in
relation to which it is the legal owner, Westpac shall:
(i) act in accordance with the standards and practices
applied by Westpac to other assets which it owns in
the ordinary course of its business and in accordance
with the Procedures Manual; and
(ii) exercise the degree of diligence and care expected of
an appropriately qualified lender in relation to the
relevant financial products.
(c) Westpac may delegate to the Servicer the collection and
receipt of the Collections referred to in paragraph (a).
Westpac may revoke that delegation. Westpac shall remain
liable under paragraph (a) despite any delegation under this
paragraph (c). If Westpac delegates to the Servicer the
collection and receipt of any Collections, the Servicer must
not deposit any Collections in its own account, and shall
deposit them in the relevant Collections Account not later
than the time that Westpac would have been required to deposit
them under this Agreement.
(d) Following the perfection of title to any Receivable and
Receivable Rights, the Servicer shall assist the Trustee in
relation to the collection and receipt of Collections in
respect of those Receivables and Receivable Rights.
6.2 Remittances
(a) If Westpac has a short term rating of A-1+ from the Designated
Rating Agency, or otherwise satisfies the requirements of the
Designated Rating Agency so that any rating given by the
Designated Rating Agency in respect of the Notes will not be
adversely affected, Westpac must pay the Collections it
receives during a Collection Period on the Remittance Date for
that Collection Period into the relevant Collections Account.
(b) Subject to the terms of the relevant Series Notice, on that
Remittance Date, Westpac must pay into the relevant Collection
Account an amount equal to the aggregate of:
(i) the Collections received during the Collection Period
relating to that Remittance Date; and
(ii) an amount equal to the interest that would have been
earned on such Collections received by it if they had
been deposited into the relevant Collection Account
five Business Days following receipt by the Servicer,
less an amount equal to any Taxes payable in relation to those
Collections and any other amount Westpac may retain in
accordance with any relevant Series Notice.
(c) If Westpac does not have a short term rating of A1+ from the
Designated Rating Agency, or otherwise does not satisfy the
requirements of the Designated Rating Agency so that the
rating given by the Designated Rating Agency in respect of the
Notes will be adversely affected, then Westpac shall pay all
Collections in its possession or control into the relevant
Collection Account no later than five Business Days following
receipt.
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(d) If a Collection Account is not maintained with Westpac, or a
subsidiary of Westpac, all Collections in relation to the
relevant Trust must be deposited into that Collection Account
no later than two Business Days following receipt of them by
Westpac.
6.3 Remittances to Trustee
(a) (Transfer of funds to Trustee) Westpac shall pay to the
relevant Collection Account all funds required to be paid to
the Trustee in accordance with this Clause 6 by wire transfer
or as otherwise instructed by the Trustee in same day funds.
(b) (Payment dishonoured) If Westpac pays funds relating to any
payment in respect of Receivables and Receivable Securities to
the Trustee and the related Obligor's payment for the payment
is, or is returned, dishonoured, Westpac shall be entitled to
a return of the amount remitted to the Trustee for which
Westpac did not receive funds from the Obligor. Westpac may
withhold that amount from funds subsequently remitted to the
Trustee in relation to the Relevant Trust.
6.4 Payments and Computations, etc.
(a) Subject to the terms of any relevant Series Notice, Westpac
shall make all payments to the Trustee under a Transaction
Document:
(i) without set off or counterclaim and without
deduction, except in relation to any deductions that
may be made in accordance with this Clause; and
(ii) by paying or depositing it in accordance with the
terms of the relevant Transaction Document no later
than 4.00 pm on the day when due in same day funds.
(b) If any payment is due on a day which is not a Business Day,
the due date will be the next Business Day.
6.5 Report by Servicer
On or before each Determination Date for each Relevant Trust the
Servicer will prepare and submit to the Trust Manager a report on
Collections, and provide such other information as the Trust Manager
reasonably requires to prepare its report under Clause 18.15 of the
Master Trust Deed.
6.6 No Right of Set-Off
Notwithstanding any term of any other document, whether relating to the
establishment of a Collection Account or otherwise, if a Collection
Account is maintained with Westpac, Westpac agrees that it shall have
no right of set-off, banker's lien, right of combination of accounts,
right to deduct moneys or any other analogous right or security in or
against any funds held in the Collection Account for any amount owed to
Westpac.
7. SERVICER FEES
7.1 Fee
The Trustee shall in accordance with, and subject to the relevant
Series Notice pay to the Servicer a fee for providing its services
under this Agreement in relation to each Trust.
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7.2 Expenses of Servicer and Westpac
(a) The Trustee must reimburse the Servicer and Westpac for all
legal and selling expenses relating to the enforcement and
recovery of the Receivables, including legal expenses,
valuations, premiums on force -placed insurance policies where
the relevant Obligor has cancelled or let lapse an insurance
policy, rates and taxes, any amount repaid to a liquidator or
trustee in bankruptcy under any applicable law, binding code,
order or decision of a court, tribunal or the like or based on
the advice of the Servicer's legal advisers, and other
reasonable amounts which the Servicer or Westpac reasonably
spends or incurs in relation to the enforcement or sale,
provided that where the consent of an insurer under a Mortgage
Insurance Policy is required in order for an expense to be
reimbursable by that insurer, the Servicer or Westpac will
only be reimbursed where it has obtained that consent. This
right of reimbursement to Westpac is subject to the terms of
any relevant Trust Back under the Master Trust Deed.
(b) The Servicer will invoice the Trustee monthly on each
Determination Date in relation to each Relevant Trust for the
costs and expenses under paragraph (a), and shall provide
reasonable details and supporting documentation in relation to
amounts to be reimbursed.
(c) This reimbursement shall be in accordance with the relevant
Series Notice.
(d) The Trustee must, in accordance with the Master Trust Deed, on
the recommendation of the Trust Manager, reimburse the
Servicer for all costs and expenses incurred by the Servicer
in complying with Clause 2.7.
(e) Except as provided in this Clause, the Servicer shall be
responsible for all other costs and expenses of servicing the
Receivables.
(f) Westpac and the Servicer shall determine between themselves
who will incur the liabilities referred to in paragraph (a).
They will inform the Trustee and the Trust Manager on request
of the arrangements that they make.
8. TERMINATION
8.1 Expiry of Term
This Agreement shall continue until the expiry of the Term.
8.2 Servicer Transfer Event
(a) If a Servicer Transfer Event occurs, the Trustee at its option
in the manner and at the times the Trustee in its absolute
discretion deems appropriate but without any obligation to do
so and notwithstanding any omission, neglect, delay or waiver
of the right to exercise such option may by notice terminate
this Agreement with immediate effect.
(b) Following such action:
(i) Clause 3.4 shall apply; and
(ii) the Servicer must promptly transfer at its own cost
to the Trustee or as the Trustee directs the relevant
information in the Data Base held or maintained by
the Servicer in relation to this Agreement, the
Receivables or Receivable Securities.
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(c) The Trustee will not appoint any other person to perform all
or part of the obligations the Servicer has undertaken to
perform under this Agreement or to service any of the
Receivables unless:
(i) the Trustee has terminated this Agreement in
accordance with the provisions of paragraph (a); or
(ii) the Servicer has resigned in accordance with clause
8.3.
8.3 Resignation
The Servicer shall not resign without first giving 3 months' notice to
the Designated Rating Agency, the Trust Manager and the Trustee. If the
Trustee has not appointed an Eligible Servicer to be the Servicer, and
that Eligible Servicer has agreed to act as Servicer, by the expiration
of that notice period, the Trustee shall act as Servicer and is
entitled to the fee payable under Clause 7 while so acting.
8.4 Survival
The obligations of the Servicer under Clause 8 survive the termination
of this Agreement.
8.5 Release of outgoing Servicer
Except as provided in Clause 8.4, upon retirement or removal and
provided there has been payment to the Trustee of all sums due to it by
the outgoing Servicer under this deed at that date, the outgoing
Servicer shall be released from all further obligations under this deed
but no release under this clause shall extend to any existing or
antecedent fraud, negligence or wilful default on the part of the
outgoing Servicer or its officers, employees, agents or delegates.
8.6 New Servicer to execute deed
(a) A new Servicer shall execute a deed in such form as the
Trustee may reasonably require under which the new Servicer
shall undertake to the Trustee and other relevant parties to
be bound by all the covenants on the part of the Servicer
under the Transaction Documents from the date of execution of
the new deed on the same terms contained in the Transaction
Documents.
(b) On and from the date of execution of the new deed, the new
Servicer shall and may afterwards exercise all the powers,
enjoy all the rights and shall be subject to all the duties
and obligations of the Servicer under the Transaction
Documents as fully as though the new Servicer had been
originally named as a party to it.
8.7 Settlement and discharge
The Trustee shall settle with the outgoing Servicer the amount of any
sums payable by the outgoing Servicer to the Trustee or by the Trustee
to the outgoing Servicer and shall give to or accept from the outgoing
Servicer a discharge in respect of those sums which shall be conclusive
and binding as between the Trustee, the outgoing Servicer, the new
Servicer, the Trust Manager, the Beneficiaries and the Noteholders.
9 INDEMNITY
9.1 Indemnity
Subject to the succeeding provision of this clause, the Servicer fully
indemnifies the Trustee from and against any expense, loss, damage or
liability which the Trustee may incur as a consequence of a Servicer
Transfer Event, or a failure by the Servicer to perform its duties
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under this Agreement, including, without limitation, a failure to
deliver the Relevant Documents to the Trustee when it is required to do
so or to keep the Receivables Register in accordance with this
Agreement.
9.2 Limitation of liability
The Servicer is not liable:
(a) in connection with anything done by it in good faith in
reliance upon any document, form or list provided by or on
behalf of the Trustee except when it has actual knowledge, or
ought reasonably know, that the document, form or list is not
genuine;
(b) if it fails to do anything because it is prevented or hindered
from doing it by any Law; or
(c) subject to the Corporations Law, if a person (other than a
delegate or agent of the Servicer) fails to carry out an
agreement with the Trustee or the Servicer in connection with
the Services (except when the failure is due to the Servicer's
own neglect or default).
9.3 No liability for acts of certain persons
If the Servicer relies in good faith on an opinion, advice, information
or statement given to it, by a person the Servicer is not liable for
any misconduct, mistake, oversight, error of judgment, forgetfulness or
want of prudence on the part of that person, except:
(a) when the person is not independent from the Servicer; or
(b) it would not be reasonable to rely upon the opinion, advice,
information or statement from the person who gives it; or
(c) where that person is a delegate or agent of the Servicer.
A person will be regarded as independent notwithstanding that the
person acts or has acted as adviser to the Servicer so long as separate
instructions are given by the Servicer to that person.
9.4 No liability for loss etc
The Servicer is not liable:
(a) for any loss, cost, liability or expense arising out of the
exercise or non-exercise of a discretion by the Trustee or the
Trust Manager or the act or omission of the Trustee or the
Trust Manager except to the extent that it is caused by the
Servicer's own fraud, negligence or breach of duty or
contract; or
(b) for any loss, cost, liability or expense caused by its failure
to check any information, document, form or list supplied or
purported to be supplied to it by the Trustee or the Trust
Manager except to the extent that the loss is caused by the
Servicer's own fraud, negligence or breach of duty or
contract.
This exclusion does not apply in relation to the acts or omissions of
the Trust Manager for so long as the Servicer is the Trust Manager.
9.5 Method of claiming under indemnity
The Servicer shall not be obliged to pay any indemnity under this
Agreement, unless:
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(a) the Trustee first establishes that there has been a breach
that has caused loss;
(b) the indemnity claimed represents no more than the loss
incurred as a result of the breach; and
(c) the Trustee first gives the Servicer a written notice
specifying:
(i) the quantum of the claim; and
(ii) the basis of the claim.
9.6 Time of Payment
The Servicer shall pay any amount it is required to pay under this
Clause within 7 Business Days of receipt of notice under Clause 9.5.
10. REPRESENTATIONS AND WARRANTIES
10.1 Representations and Warranties
Each of Westpac and the Servicer makes the representations and
warranties in Clause 32 of the Master Trust Deed in relation to itself
for the benefit of the Trustee.
10.2 Reliance
The Servicer acknowledges that the Trustee has entered into this
Agreement in reliance on the representations and warranties in Clause
10.1.
10.3 Survival of Representations and Indemnities
(a) All representations and warranties in a Transaction Document
survive theexecution and delivery of the Transaction
Documents.
(b) Each indemnity in this Agreement:
(i) is a continuing obligation;
(ii) is a separate and independent obligation; and
(iii) survives termination or discharge of this Agreement.
11. WESTPAC AND THE SERVICER MAY ACT AS BANKER
Each of Westpac and the Servicer may (without having to account to the
Trustee) engage in any kind of banking, finance, trust or other
business permitted under any law with any Obligor as if, in the case of
Westpac, it did not have obligations under this Agrement, and, in the
case of the Servicer, it were not the Servicer. Neither Westpac nor the
Servicer shall not be required to account to the Trustee for any moneys
received by it on any account that is unrelated to Receivables and
Receivable Securities or the Services.
<PAGE>
Page 20
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12. ADMINISTRATIVE PROVISIONS
12.1 Notices
All notices, requests, demands, consents, approvals or agreements to or
by a party to this Agreement:
(a) must be in writing;
(b) must be signed by an Authorised Signatory of the sender; and
(c) will be taken to be duly given or made (in the case of
delivery in person or by post or facsimile transmission) when
delivered, received or left at the address of the recipient
shown in this Agreement or to any other address which it may
have notified the sender, but if delivery or receipt is on a
day on which business is not generally carried on in the place
to which the communication is sent or is later than 4 pm
(local time), it will be taken to have been duly given or made
at the commencement of business on the next day on which
business is generally carried on in that place.
12.2 Governing Law and Jurisdiction
This Agreement is governed by the laws of the Australian Capital
Territory. Each of the Servicer and the Trustee submits to the
non-exclusive jurisdiction of courts exercising jurisdiction there.
12.3 Assignment
Neither party may assign, novate, transfer or deal with its obligations
under this Agreement.
12.4 Amendment
This Agreement can only be amended in writing, and provided prior
notice of any proposed amendment is given to the Designated Rating
Agency.
12.5 Severability Clause
Any provisions of any Transaction Document which are prohibited or
unenforceable in any jurisdiction are ineffective to the extent of the
prohibition or unenforceability. That does not invalidate the remaining
provisions of that Transaction Document nor affect the validity or
enforceability of that provision in any other jurisdiction.
12.6 Costs and Expenses
(a) (Trustees costs and expenses) On demand each of Westpac and
the Servicer shall reimburse the Trustee for the reasonable
expenses of the Trustee (as applicable) in relation to any
enforcement of this Agreement against it including in each
case legal costs and expenses on a full indemnity basis and
each party shall bear their own costs (other than legal costs)
relating to the preparation execution and completion of this
Agreement;
(b) (Stamp duty) In addition, the Servicer shall pay all stamp and
registration Taxes (including fines and penalties) which may
be payable or determined to be payable in relation to the
execution, delivery, performance or enforcement of this
Agreement.
(c) (Services costs and expenses) In accordance with the Series
Notice, the Trustee shall reimburse the Servicer for the
reasonable expenses of the Servicer (as
<PAGE>
Page 21
- -------------------------------------------------------------------------------
applicable) in relation to any enforcement of this Agreement
including in each case legal costs and expenses on a full
indemnity basis.
12.7 Waivers: Remedies Cumulative
(a) No failure on the part of a party to exercise and no delay in
exercising any right, power or remedy under any Transaction
Document operates as a waiver. Nor does any single or partial
exercise of any right, power or remedy preclude any other or
further exercise of that or any other right, power or remedy.
(b) The rights, powers and remedies provided to the Trustee in the
Transaction Documents are in addition to any right, power or
remedy provided by law.
EXECUTED in Canberra.
Each attorney executing this Agreement states that he has no notice of
revocation or suspension of his power of attorney.
SIGNED on behalf of )
WESTPAC BANKING CORPORATION )
by its attorneys in the )
presence of: )
GEORGE KEVIN MARQUES LEITH LYON WINTOUR
- ------------------------------------- ------------------------------
Signature Signature
- ------------------------------------ ------------------------------
Print name Print name
- ------------------------------------ ------------------------------
Signature Signature
- ------------------------------------ ------------------------------
Print name Print name
SIGNED on behalf of )
THE MORTGAGE COMPANY PTY )
LIMITED by its attorney )
in the presence of: ) LEITH LYON WINTOUR
------------------------------
) Signature
GEORGE KEVIN MARQUES
- ------------------------------------ ------------------------------
Witness Print name
- ------------------------------------
Print name
<PAGE>
Page 22
- -------------------------------------------------------------------------------
SIGNED on behalf of )
WESTPAC SECURITIES )
ADMINISTRATION LIMITED )
by its attorney ) CHRISTOPHER GEOFFREY
in the presence of: ) CHENOWORTH
-----------------------------
) Signature
GEORGE KEVIN MARQUES
- ------------------------------------ -----------------------------
Witness Print name
- ------------------------------------
Print name
<PAGE>
Page 23
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SCHEDULE 1
RECEIVABLES REGISTER INFORMATION
The Receivables Register shall contain the following information in relation to
each Mortgage.
1. Name and address of the relevant Obligor(s).
2. Account/reference number of the loan under the relevant loan document,
letter of offer or terms and conditions.
3. The title reference for the relevant Mortgaged Property.
4. Such other information as the Servicer and the Trustee may agree from
time to time.
5. The registered dealing number of that Mortgage from the relevant Land
Titles Office together with:
(a) in respect of Mortgaged Property in New South Wales, the
volume and folio number(s) for the Mortgaged Property;
(b) in respect of Mortgaged Property in Queensland:
(i) a description of the lot, county, parish and title
reference(s) of the Mortgaged Property; and
(ii) full name and address of any party other than the
relevant Obligor(s) and Westpac having the right to
deal with the Mortgaged Property;
(c) in respect of Mortgaged Property in Western Australia:
(i) lot and diagram/plan/strata plan number(s) or
location name and number(s); and
(ii) volume and folio number(s) or crown lease number(s);
(d) in respect of Mortgaged Property in South Australia, the
volume and folio number(s) for the Mortgaged Property;
(e) in respect of Mortgaged Property in Tasmania, the volume and
folio number(s) for the Mortgaged Property;
(f) in respect of Mortgaged Property in the Australian Capital
Territory district/division, section, block, unit, volume and
folio number(s) for the Mortgaged Property;
(g) in respect of Mortgaged Property in the Northern Territory,
the Receivables Register, volume, folio, location, parcel,
plan and unit for the Mortgaged Property;
(h) in respect of Mortgaged Property in Victoria, the volume and
folio number(s) for the Mortgaged Property.
<PAGE>
Page 24
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SCHEDULE 2
AUDIT
1. Each audit referred to in Clause 3.3 shall involve a review of the
following:
(a) the custodial procedures adopted by the Servicer;
(b) that the Relevant Documents are capable of identification,
segregated by reference to the relevant Portfolio of
Receivables and from other mortgage title documents held by
the Servicer;
(c) that controls exist such that the Relevant Documents may not
be removed or tampered with except with appropriate
authorisation; and
(d) that an appropriate tracking system is in place such that the
location of the Relevant Documents can be detected at any
time.
2. The Auditor will review a sample of the Security Packets and confirm
that those Security Packets contain the Relevant Documents which the
Series Terms indicate that they should (including, as a minimum, the
Receivable Security documents, and any Certificate of Title if issued).
3. The Auditor's certificate referred to in Clause 3.3 will set out
whether any errors detected by the Auditor in the relevant audit were
the result of isolated non-compliance with the control system
established by the Servicer under this Agreement or result from a
weakness in that control system.
4. The Auditor's certificate referred to in Clause 3.3 will grade the
custodial performance of the Servicer under this Agreement based on the
following grades.
(A) Good - All control procedures and accuracy of
information in respect of Relevant Documents
completed without exception, other than
immaterial and occasional variances.
(B) Satisfactory - Minor exceptions to compliance with control
procedures and accuracy of information in
respect of Relevant Documents
(C) Improvement
required - Base internal controls are in place but a
number of issues were identified that need
to be resolved for controls to be considered
adequate; and testing of the relevant
information in respect of Relevant Documents
identified a number of minor exceptions to
compliance which are the result of
non-compliance with the control system
(D) Adverse - Major deficiencies in internal controls and
the relevant information in respect of the
Relevant Documents were identified.
<PAGE>
Exhibit 10.2
[ALLEN ALLEN & HEMSLEY LETTERHEAD]
WESTPAC BANKING CORPORATION
(Westpac)
THE MORTGAGE COMPANY PTY LIMITED
(Servicer)
WESTPAC SECURITIES ADMINISTRATION LIMITED
(Trustee)
WESTPAC SECURITISATION TRUSTS
SERVICING AGREEMENT
SERIES 1998-1G AMENDMENT AGREEMENT
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
1. DEFINITIONS AND INTERPRETATION ............................ 1
1.1 Definitions ...................................... 1
1.2 Interpretation ................................... 1
2. AMENDMENT ................................................. 1
3. AMENDMENTS LIMITED ........................................ 4
4. GOVERNING LAW ............................................. 4
5. COUNTERPARTS .............................................. 4
</TABLE>
<PAGE>
SERVICING AGREEMENT SERIES 1998-1G AMENDMENT AGREEMENT
AGREEMENT dated 1998 between
1. WESTPAC BANKING CORPORATION (ARBN 007 457 141) incorporated in New
South Wales of 60 Martin Place, Sydney in its capacity as an Approved
Seller to the Series 1998-1G WST Trust (Westpac);
2. THE MORTGAGE COMPANY PTY LIMITED (ACN 070 968 302) incorporated in
the Australian Capital Territory of Level 6, 228 Pitt Street, Sydney
as servicer of the Series 1998-1G WST Trust (the Servicer); and
3. WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472)
incorporated in New South Wales of Level 10, 130 Pitt Street, Sydney
as trustee of the Series 1998-1G WST Trust (the Trustee).
RECITALS
A. The Trustee, Westpac and the Servicer are parties to a Servicing
Agreement dated 18 February 1997 (the Servicing Agreement).
B. The Trustee, Westpac and the Servicer wish to amend the Servicing
Agreement so far as the Servicing Agreement relates to the Trust, in
the manner set out in this agreement.
IT IS AGREED as follows
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
Definitions in the Servicing Agreement apply in this agreement unless
the context requires otherwise or the relevant term is defined in
this agreement, but Trust means the Series 1998-1G WST Trust
constituted under the Master Trust Deed and the Series Notice dated
on or about the date of this agreement.
1.2 Interpretation
Clause 1.2 of the Servicing Agreement applies as if incorporated in
this agreement.
2. AMENDMENT
The Servicing Agreement is amended so far as it relates to the Trust
as follows.
(a) The definition of Custody Transfer Trigger in clause 1.1
of the Servicing Agreement is deleted and replaced with
the following definition.
"Custody Transfer Trigger means any of the following
events:
(a) a Further Audit resulting in an adverse
report;
(b) the long term credit rating of the holding
company of the Servicer that is downgraded:
1
<PAGE>
(i) below BBB by S&P; or
(ii) below Baa2 by Moody's; or
(iii) below BBB by Fitch IBCA; or
(c) the Servicer is in default under a servicing
agreement between it and any other person,
and by reason of the default that other
person removes any documents in the
Servicer's custody under the servicing
agreement where that person would otherwise
not have been entitled to do so."
(b) The definition of Servicer Transfer Event in clause 1.1
of the Servicing Agreement is amended by deleting the
number "10" in paragraph (b) and inserting the number
"5".
(c) Clause 1.3 of the Servicing Agreement is deleted and
replaced with the following new clause.
"1.3 Limitation of liability of the Trustee
(a) General
Clause 33 of the Master Trust Deed applies
to the obligations and liabilities of the
Trustee under this agreement.
(b) Liability of Trustee limited to its right of
indemnity
(i) This agreement applies to the
Trustee only in its capacity as
trustee of the Trust and in no other
capacity. A liability arising under
or in connection with this agreement
or the Trust can be enforced against
the Trustee only to the extent to
which it can be satisfied out of
property of the Trust out of which
the Trustee is actually indemnified
for the liability. This limitation
of the Trustee's liability applies
despite any other provision of this
agreement and extends to all
liabilities and obligations of the
Trustee in any way connected with
any representation, warranty,
conduct, omission, agreement or
transaction related to this
agreement or the Trust.
(ii) The parties other than the Trustee
may not sue the Trustee in any
capacity other than as trustee of
the Trust or seek the appointment of
a receiver (except under the
Security Trust Deed), or a
liquidator, an administrator or any
similar person to the Trustee or
prove in any liquidation,
administration or arrangements of or
affecting the Trustee.
(iii) The provisions of this clause 1.3
shall not apply to any obligation or
liability of the Trustee to the
extent that it is not satisfied
because under a Transaction Document
or by operation of law there is a
reduction in the extent of the
Trustee's indemnification out of the
Assets of the Trust as a result of
the Trustee's fraud, negligence or
breach of trust.
(iv) It is acknowledged that the Trust
Manager, the Servicer, the Note
Trustee, the Principal Paying Agent,
the other Paying Agents and the
Agent Bank (each a Relevant Party)
are responsible under this agreement
and the other Transaction Documents
for performing a variety of
obligations relating to
2
<PAGE>
the Trust. No act or omission of the
Trustee (including any related
failure to satisfy its obligations
under this agreement) will be
considered fraud, negligence or
breach of trust of the Trustee for
the purpose of sub-paragraph (iii)
to the extent to which the act or
omission was caused or contributed
to by any failure by any Relevant
Party or any other person who
provides services in respect of the
Trust (other than a person who has
been delegated or appointed by the
Trustee and for whom the Trustee is
responsible under this agreement or
the relevant Transaction Documents,
but excluding any Relevant Party) to
fulfil its obligations relating to
the Trust or by any other act or
omission of a Relevant Party or any
other person who provides services
in respect of the Trust (other than
a person who has been delegated or
appointed by the Trustee and for
whom the Trustee is responsible
under this agreement or the relevant
Transaction Documents, but excluding
any Relevant Party).
(v) No attorney, agent, receiver or
receiver and manager appointed in
accordance with this agreement or
any other Transaction Documents
(including a Relevant Party) has
authority to act on behalf of the
Trustee in a way which exposes the
Trustee to any personal liability
and no act or omission of any such
person will be considered fraud,
negligence or breach of trust of the
Trustee for the purpose of
sub-paragraph (iii), if the Trustee
has exercised reasonable care in the
selection and supervision of such a
person."
(d) Clause 3.1(d)(ii) of the Servicing Agreement is deleted
and replaced with the following clause 3.1(d)(ii).
"(d) if its holding company has a short term
rating from S&P of not less than A- and a
short term rating from Moody's of not less
than A2, and a short term rating from Fitch
IBCA of not less than A- not later than the
last Business Day of each calendar year
during the Term;".
(e) Clause 3.4 of the Servicing Agreement is amended by
deleting the word "may" in the fourth last line of that
clause and replacing it with the word "must".
(f) Clause 6.2(a) of the Servicing Agreement is deleted and
replaced with the following clause 6.2(a).
"(a) If Westpac has a short term rating of A-1+
from S&P and P-1 from Moody's and A-1+ from
Fitch IBCA, or otherwise satisfies the
requirements of both Designated Rating
Agencies so that any rating given by any
Designated Rating Agency in respect of the
Notes will not be adversely affected,
Westpac must pay the Collections it receives
during a Collection Period on the Remittance
Date for that Collection Period into the
relevant Collection Account."
(g) Clause 6.2(c), of the Servicing Agreement is deleted and
replaced with the following clause 6.2(c).
"(c) If Westpac does not have a short term rating of
at least A1+ from S&P and at least P-1 from
Moody's and at least A1+ from Fitch IBCA, or
otherwise does not satisfy the requirements of
both of those Designated Rating Agencies so
that the rating given by any Designated Rating
Agency in respect of the Notes will be
adversely affected, then Westpac shall pay all
Collections in its
3
<PAGE>
possession or control into the relevant
Collection Account no later than five Business
Days following receipt."
(h) Clause 8.2(a) of the Servicing Agreement is deleted and
replaced with the following clause 8.2(a).
"(a) If a Servicer Transfer Event occurs, the
Trustee must terminate this Agreement with
immediate effect. The Trustee must promptly
give notice of that termination to the Trust
Manager, the Approved Seller, the Servicer and
the Designated Rating Agencies."
(i) The following is inserted as clause 8.2(d):
"(d) If this agreement is terminated in accordance
with this clause 8.2, then until the Trustee
appoints an Eligible Servicer to be the
Servicer, and that Eligible Servicer agrees to
act as Servicer, the Trustee shall act as
Servicer and is entitled to the fee payable
under clause 7 while so acting."
(j) Clause 8.3 of the Servicing Agreement is amended by
deleting the words ", and that" in line two of that
clause and replacing them with the word "which".
(k) Paragraph 5(b)(ii) of schedule 1 to the Servicing Agreement is
deleted.
3. AMENDMENTS LIMITED
The amendments to the Servicing Agreement set out in this agreement
apply only in relation to the Trust, and do not apply in relation to
any other Trust (as defined in the Master Trust Deed).
4. GOVERNING LAW
This agreement is governed by the laws of the [Australian Capital
Territory] and each party submits to the non-exclusive jurisdiction
of its courts and the courts exercising jurisdiction in that State.
5. COUNTERPARTS
This agreement may be executed in any number of counterparts. All
counterparts taken together are deemed to constitute one instrument.
EXECUTED in Sydney.
Each attorney executing this agreement states that he has no notice of
revocation or suspension of his power of attorney.
SIGNED on behalf of )
WESTPAC BANKING CORPORATION )
by its attorneys in the )
presence of: )
/s/ /s/
- --------------------- ---------------------------
Signature Signature
- --------------------- ---------------------------
Print name Print name
4
<PAGE>
SIGNED on behalf of )
THE MORTGAGE COMPANY PTY )
LIMITED by its attorney )
in the presence of: )
---------------------------
) Signature
/s/
- --------------------- ---------------------------
Witness Print name
- ---------------------
Print name
SIGNED on behalf of )
WESTPAC SECURITIES )
ADMINISTRATION LIMITED )
by its attorney )
in the presence of: )
/s/
---------------------------
) Signature
/s/
- --------------------- ---------------------------
Witness Print name
- ---------------------
Print name
5
<PAGE>
Exhibit 10.3
WESTPAC SECURITIES ADMINISTRATION LIMITED
(Trustee)
WESTPAC BANKING CORPORATION
(Liquidity Provider)
and
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
(Trust Manager)
---------------------------------------------
SERIES 1998-1G WST TRUST
LIQUIDITY FACILITY AGREEMENT
---------------------------------------------
(C) Allen Allen & Hemsley
Sydney
Ref: AEJ [ ]
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
T A B L E O F C O N T E N T S
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. DEFINITIONS AND INTERPRETATION . . . . . . . . . . . . . . . . . . . 1
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Master Trust Deed definitions . . . . . . . . . . . . . . . 3
1.3 Interpretation . . . . . . . . . . . . . . . . . . . . . . 3
1.4 Determination, statement and certificate sufficient
evidence . . . . . . . . . . . . . . . . . . . . . . . 4
1.5 Transaction Document. . . . . . . . . . . . . . . . . . . . 4
1.6 Limited to Trust . . . . . . . . . . . . . . . . . . . . . 4
2. PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. DRAWINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.1 Liquidity Draw . . . . . . . . . . . . . . . . . . . . . . 4
3.2 Making of Liquidity Draws . . . . . . . . . . . . . . . . . 5
3.3 Collateral Account . . . . . . . . . . . . . . . . . . . . 5
3.4 Collateral Account with Liquidity Provider . . . . . . . . 6
3.5 New Account . . . . . . . . . . . . . . . . . . . . . . . . 6
3.6 Conditions to transfer of account balance . . . . . . . . . 6
3.7 Withdrawal from accounts . . . . . . . . . . . . . . . . . 6
3.8 Liquidity Provider upgrade . . . . . . . . . . . . . . . . 7
3.9 Interest Cash Advance Deposit . . . . . . . . . . . . . . . 7
4. FUNDING PERIODS . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5. INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.1 Accrual . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.2 Payment . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.3 Capitalisation . . . . . . . . . . . . . . . . . . . . . . 8
6. COMMITMENT FEE . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
7. CANCELLATION OF LIQUIDITY LIMIT . . . . . . . . . . . . . . . . . . 8
7.1 During Term . . . . . . . . . . . . . . . . . . . . . . . . 8
7.2 At end of Term . . . . . . . . . . . . . . . . . . . . . . 9
8. REPAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
8.1 Final repayment . . . . . . . . . . . . . . . . . . . . . . 9
8.2 Repayment of Liquidity Draws . . . . . . . . . . . . . . . 9
8.3 Repayments during Liquidity Collateralisation Period . . . 9
9. PREPAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
9.1 Voluntary prepayments . . . . . . . . . . . . . . . . . . . 9
9.2 Interest . . . . . . . . . . . . . . . . . . . . . . . . . 9
9.3 Limitation on prepayments . . . . . . . . . . . . . . . . . 9
<PAGE>
Page (ii)
- --------------------------------------------------------------------------------
10. PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
10.1 Manner . . . . . . . . . . . . . . . . . . . . . . . . . . 9
10.2 Payment to be made on Business Day . . . . . . . . . . . .10
10.3 Appropriation where insufficient moneys available . . . . .10
11. CHANGES IN LAW . . . . . . . . . . . . . . . . . . . . . . . . . . .10
11.1 Additional payments . . . . . . . . . . . . . . . . . . . .10
11.2 Minimisation . . . . . . . . . . . . . . . . . . . . . . .11
11.3 Survival . . . . . . . . . . . . . . . . . . . . . . . . .11
12. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . .11
12.1 Conditions precedent to initial Drawdown Notice . . . . . .11
12.2 Conditions precedent to each Liquidity Draw . . . . . . . .11
13. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . .12
13.1 Representations and warranties . . . . . . . . . . . . . .12
13.2 Reliance on representations and warranties . . . . . . . .13
14. UNDERTAKINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
14.1 General undertakings . . . . . . . . . . . . . . . . . . .14
14.2 Undertakings relating to Trust . . . . . . . . . . . . . .14
14.3 Term of undertakings . . . . . . . . . . . . . . . . . . .15
15. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . .15
15.1 Events of Default . . . . . . . . . . . . . . . . . . . . .15
15.2 Consequences . . . . . . . . . . . . . . . . . . . . . . .15
16. INTEREST ON OVERDUE AMOUNTS . . . . . . . . . . . . . . . . . . . .16
16.1 Accrual . . . . . . . . . . . . . . . . . . . . . . . . . .16
16.2 Payment . . . . . . . . . . . . . . . . . . . . . . . . . .16
16.3 Limitation. . . . . . . . . . . . . . . . . . . . . . . . .16
17. CONTROL ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . .16
18. WAIVERS, REMEDIES CUMULATIVE . . . . . . . . . . . . . . . . . . . .16
19. SEVERABILITY OF PROVISIONS . . . . . . . . . . . . . . . . . . . . .16
20. SURVIVAL OF REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . .17
21. INDEMNITY AND REIMBURSEMENT OBLIGATION . . . . . . . . . . . . . . .17
22. MORATORIUM LEGISLATION . . . . . . . . . . . . . . . . . . . . . . .17
23. CONSENTS AND OPINIONS . . . . . . . . . . . . . . . . . . . . . . .17
24. ASSIGNMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
25. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
<PAGE>
Page (iii)
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26. AUTHORISED SIGNATORIES . . . . . . . . . . . . . . . . . . . . . . .18
27. GOVERNING LAW AND JURISDICTION . . . . . . . . . . . . . . . . . . .18
28. COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
29. ACKNOWLEDGEMENT BY TRUSTEE . . . . . . . . . . . . . . . . . . . . .18
30. LIMITED RECOURSE . . . . . . . . . . . . . . . . . . . . . . . . . .18
30.1 General . . . . . . . . . . . . . . . . . . . . . . . . . .18
30.2 Liability of Trustee limited to its right to indemnity. . .18
30.3 Unrestricted remedies . . . . . . . . . . . . . . . . . . .19
30.4 Restricted remedies . . . . . . . . . . . . . . . . . . . .19
31. LIQUIDITY PROVIDER'S OBLIGATIONS . . . . . . . . . . . . . . . . . .20
32. SUCCESSOR TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . .20
<PAGE>
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LIQUIDITY FACILITY AGREEMENT
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AGREEMENT dated 1998 between:
1. WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472)
incorporated in New South Wales of Level 10, 130 Pitt Street, Sydney,
New South Wales as Trustee of the Series 1998-1G WST Trust (the
Trustee);
2. WESTPAC BANKING CORPORATION (ARBN 007 457 141) incorporated in New
South Wales of 60 Martin Place, Sydney, New South Wales (the
Liquidity Provider); and
3. WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 081 709 211)
incorporated in the Australian Capital Territory of Level 6, 60 Martin
Place, Sydney, New South Wales (the Trust Manager).
RECITAL
The Trustee has requested the Liquidity Provider to provide the Trustee with a
liquidity facility under which loans of up to an aggregate amount of $[*] may be
made available to the Trustee.
IT IS AGREED as follows.
I. DEFINITIONS AND INTERPRETATION
1.1. Definitions
In this agreement the following definitions apply unless the context
requires otherwise, or unless otherwise defined.
Bank Bill Rate, in relation to a Funding Period, has the meaning given
in the Series Notice in relation to the first day of that Funding
Period, but if a Funding Period is less than 90 days the Bank Bill Rate
shall be an interpolated rate calculated with reference to the tenor of
that Funding Period.
Cash Advance Deposit means the balance of the Collateral Account from
time to time.
Collateral Account means (as the context requires):
(a) the account established and maintained in accordance with
clause 3.3;
(b) the account established and maintained in accordance with
clause 3.5; or
(c) the account to which the Cash Advance Deposit is transferred
in accordance with clause 3.8.
Drawdown Date means, in relation to a Liquidity Draw, the Payment Date
on which the Liquidity Draw is or is to be made under this agreement.
Drawdown Notice means a notice under clause 3.1.
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Event of Default means any of the events specified in clause 15.
Existing Collateral Account has the meaning given in clause 3.5.
Final Repayment Date means the date on which the Term ends.
Funding Period means, in relation to a Liquidity Draw, the period
determined in accordance with clause 4.
Liquidity Collateralisation Period means each period commencing on the
date on which either:
(a) the short term credit rating of the Liquidity Provider is
either less than A-1+ from S&P or less than P-1 from Moody's;
or
(b) S&P or Moody's ceases to provide a short term credit rating
for the Liquidity Provider (other than because S&P or Moody's,
as the case may be, ceases to provide such ratings generally),
and ending on the date on which the short term credit rating of the
Liquidity Provider is both A-1+ from S&P and P-1 from Moody's.
Liquidity Draw means any advance made or to be made under this
agreement.
Liquidity Limit means at any date the least of:
(a) subject to clause 7.1, $[*];
(b) the Unpaid Balance of Performing Loans at that date; and
(c) any lesser amount as may be agreed in writing from time to
time between the Liquidity Provider, the Trustee, the Trust
Manager and the Designated Rating Agency for each Class of
Notes,
as reduced or cancelled under this agreement.
Margin means [0.15%] per annum.
Master Trust Deed means the deed entitled "Master Trust Deed" between,
among others, the Trustee and the Trust Manager dated 14 February 1997.
New Collateral Account has the meaning given in clause 3.5.
Performing Loan means, at any date, a Purchased Receivable which:
(a) is not in Arrears;
(b) at that date has been in Arrears for less than 90 consecutive
days; or
(c) if it has been in Arrears at that date for 90 or more
consecutive days, was insured under a Mortgage Insurance
Policy at the date of this agreement or on or before the
Closing Date.
Reference Bank has the meaning given in the 1991 ISDA Definitions.
Series Notice means the Series Notice issued by the Trust Manager on or
about the date of this agreement under the Master Trust Deed.
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Term means the period commencing on the date of this agreement and
expiring on the earlier of:
(a) the date which is one month after the Notes have been redeemed
in full in accordance with the Master Trust Deed;
(b) the date declared by the Liquidity Provider under clause 15.2;
(c) the date on which the Trustee enters into a liquidity
facility, as previously notified to the Designated Rating
Agency for each Class of Notes, to replace this agreement with
any other person to enable it to fund Liquidity Shortfalls;
and
(d) the date on which the Liquidity Limit is cancelled in full
under clause 7.1.
Trust means the Series 1998-1G WST Trust constituted under the Master
Trust Deed and the Notice of Creation of Trust.
Trust Document means:
(a) this agreement;
(b) the Master Trust Deed;
(c) the Notice of Creation of Trust;
(d) the Series Notice;
(e) the Bond Trust Deed;
(f) the Agency Agreement;
(g) the Security Trust Deed; and
(h) the Servicing Agreement.
Trustee means the Trustee of the Trust at the date of this agreement or
any person which becomes a successor Trustee under clause 24 of the
Master Trust Deed.
1.2 Master Trust Deed definitions
Words and expressions which are defined in the Master Trust Deed (as
amended by the Series Notice) and the Series Notice (including in each
case by reference to another agreement) have the same meanings when
used in this agreement, unless the context otherwise requires or unless
otherwise defined in this agreement.
1.3 Interpretation
Clause 1.2 of the Master Trust Deed applies to this agreement as if set
out in full, except that references to this Deed are references to this
agreement and:
(a) a reference to an asset includes any real or personal, present
or future, tangible or intangible property or asset and any
right, interest, revenue or benefit in, under or derived from
the property or asset;
(b) an Event of Default subsists until it has been waived in
writing by the Liquidity Provider; and
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(c) a reference to an amount for which a person is contingently
liable includes an amount which that person may become
actually or contingently liable to pay if a contingency
occurs, whether or not that liability will actually arise.
1.4 Determination, statement and certificate sufficient evidence
Except where otherwise provided in this agreement any determination,
statement or certificate by the Liquidity Provider or an Authorised
Signatory of the Liquidity Provider provided for in this agreement is
sufficient evidence unless proven wrong.
1.5 Transaction Document
This agreement is a Transaction Document for the purposes of the Master
Trust Deed.
1.6. Limited to Trust
The rights and obligations of the parties under this agreement relate
only to the Trust, and do not relate to any other Trust (as defined in
the Master Trust Deed). Without limitation, the Liquidity Provider has
no obligation under this agreement to provide financial accommodation
to the Trustee as trustee of any other Trust.
2. PURPOSE
The Trust Manager directs the Trustee to, and the Trustee shall, apply
the proceeds of each Liquidity Draw to fund Liquidity Shortfalls in
relation to the Trust by crediting it to the Collection Account to be
applied in accordance with clause 6 of the Series Notice, and for no
other purpose.
3. DRAWINGS
3.1 Liquidity Draw
(a) Subject to this agreement, if on any Determination Date the
Trust Manager determines that there is a Liquidity Shortfall
in relation to the Collection Period ending immediately prior
to the Determination Date, the Trust Manager must direct the
Trustee to and the Trustee shall (subject to this agreement
and the Series Notice) request a Liquidity Draw by giving to
the Liquidity Provider a Drawdown Notice.
(b) A Drawdown Notice must be:
(i) in writing;
(ii) in or substantially in the form of Annexure A;
(iii) signed by an Authorised Signatory of the Trustee; and
(iv) given not later than 11.00am (Sydney time) on the
Remittance Date following that Collection Period.
(c) The amount requested in a Drawdown Notice must be the lesser
of:
(i) the relevant Liquidity Shortfall; and
(ii) subject to paragraph (d), the Available Liquidity
Amount at that time.
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(d) If:
(i) the aggregate of all payments required to be made
under clauses 6.10(a)(i) to (iii) inclusive of the
Series Notice on the relevant Payment Date; plus
(ii) the outstanding Liquidity Draws due to be repaid on
that date; minus
(iii) the Available Income for the relevant Collection
Period;
is equal to or less than the Liquidity Limit, the calculation
of Available Liquidity Amount in paragraph (c)(ii) shall
assume the repayment of all Liquidity Draws due to be repaid
on or before the relevant Drawdown Date.
(e) The Trustee irrevocably authorises the Liquidity Provider to
apply against a Liquidity Draw provided on any Drawdown Date
all amounts which are assumed to have been applied in repaying
previous Liquidity Draws as contemplated by paragraph (d).
(f) In the case of a Liquidity Draw provided:
(i) in accordance with paragraph (c)(i); or
(ii) following an application of paragraph (d),
the Liquidity Provider will only be required to advance to the
Trustee the difference (if any) between the Liquidity Draw and
the Available Liquidity Amount immediately prior to the
relevant Drawdown Date.
3.2 Making of Liquidity Draws
Subject to the terms of this agreement, a Liquidity Draw requested in a
Drawdown Notice shall be made available:
(a) other than during a Liquidity Collateralisation Period, by the
Liquidity Provider crediting the proceeds of that Liquidity
Draw to the Collection Account by no later than 11.00 am
(Sydney time) on the relevant Payment Date;
(b) during a Liquidity Collateralisation Period when the
Collateral Account is maintained with the Liquidity Provider,
by the Trust Manager directing the Trustee to transfer the
amount of that Liquidity Draw from the Collateral Account to
the Collection Account; and
(c) during a Liquidity Collateralisation period when the
Collateral Account is not maintained with the Liquidity
Provider, by the Trust Manager directing the Trustee to
arrange to transfer the amount of that Liquidity Draw from the
Collateral Account to the Collection Account, in satisfaction
of the Liquidity Provider's obligation to make that Liquidity
Draw available, provided that none of the Liquidity Provider,
the Trust Manager nor the Trustee shall have any obligation if
for any reason the Bank maintaining the Collateral Account
does not comply with a request or direction to make a transfer
requested from the Collateral Account.
3.3 Collateral Account
If at any time the Liquidity Provider's short term credit rating is
less than A-1+ from S&P or P-1 from Moody's, or S&P or Moody's cease to
provide a short term credit rating for the
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Liquidity Provider (other than because S&P or Moody's, as the case may
be, ceases to provide such ratings generally):
(a) the Trustee must as soon as practicable establish and maintain
in the name of the Trustee an account with a Bank having a
short term rating of A-1 from S&P and P-1 from Moody's or
which otherwise satisfies the requirements of those Designated
Rating Agencies; and
(b) the Liquidity Provider must within 5 Business Days or such
longer period as each Designated Rating Agency may agree,
deposit into that account an amount equal to the Available
Liquidity Amount at that time.
3.4 Collateral Account with Liquidity Provider
If and for so long as the Liquidity Provider has a short term credit
rating from S&P of not lower than A-1 and from Moody's of not lower
than P-1, the Collateral Account shall be an account with the Liquidity
Provider.
3.5 New Account
If at any time:
(a) the short term credit rating of the Bank holding the
Collateral Account (the Existing Collateral Account) from S&P
is lower than A-1 or from Moody's is lower than P-1; or
(b) deposits credited to the Existing Collateral Account cease to
be Authorised Investments because of paragraph (g)(B) of the
definition of Authorised Investments in clause 1.1 of the
Master Trust Deed,
the Trust Manager must direct the Trustee to, and the Trustee must,
subject to clause 3.6, within 5 Business Days after such direction (or
such longer period as each Designated Rating Agency may agree):
(a) establish a new account with a Bank which has a short term
credit rating from S&P of not lower than A-1+ and from Moody's
of not lower than P-1 (the New Collateral Account) in the name
of the Trustee; and
(b) transfer so much of the balance of the Existing Collateral
Account to the New Collateral Account as is not an Authorised
Investment by application of paragraph (b).
3.6 Conditions to transfer of account balance
The Trustee shall only be obliged to transfer the balance of the
Existing Collateral Account to the New Collateral Account in
accordance with clause 3.5(d) if both the Trust Manager and the
Liquidity Provider are satisfied that the terms upon which the New
Collateral Account is established and maintained are such that:
(a) the Bank with which the New Collateral Account is maintained
will have no right of set-off, combination of accounts, lien,
flawed deposit or other Security Interest over the New
Collateral Account; and
(b) the terms of the New Collateral Account may not be varied in
any way without the prior written consent of the Liquidity
Provider.
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The Trust Manager and the Liquidity Provider must provide the Trustee
with written notice of their satisfaction with these matters as soon as
practicable.
3.7 Withdrawal from accounts
(a) The Trustee may only make withdrawals from a Collateral
Account if directed to do so by the Trust Manager, and then
only for the following purposes:
(i) to make or fund a Liquidity Draw in accordance with
this agreement;
(ii) to transfer the credit balance of the Existing
Collateral Account to a New Collateral Account in
accordance with clause 3.5;
(iii) to pay the Cash Advance Deposit to the Liquidity
Provider pursuant to clause 3.8(a);
(iv) to withdraw any amount which has been incorrectly
deposited into the Collateral Account;
(v) to pay financial institutions duty, bank accounts
debit tax or equivalent payable in respect of the
Collateral Account;
(vi) at the direction of the Trust Manager, invest in
Authorised Investments which mature no later than the
end of the Funding Period in which the Authorised
Investments were acquired provided that all amounts
received by the Trustee on that maturity must be
credited to the Collateral Account;
(vii) to refund to the Liquidity Facility Provider the
amount of any of the Liquidity Limit which is
cancelled under clause 7.1.
(b) The Trust Manager must only direct the Trustee to make
withdrawals from the Collateral Account for the above
purposes.
(c) For so long as the Collateral Account is maintained with the
Liquidity Provider, the obligations of the Liquidity Provider
with respect to payment to the Trustee of the debt constituted
by any credit balance on the Collateral Account shall be
conditional upon and subject to the terms of this clause 3.
3.8 Liquidity Provider upgrade
(a) If, at any time when the Collateral Account is not maintained
with the Liquidity Provider, a short term credit rating of the
Liquidity Provider is upgraded so that it has a rating from
S&P of not lower than A-1 and from Moody's of not lower than
P-1, the Trust Manager must direct the Trustee to, and the
Trustee must within 5 Business Days of being so directed,
arrange for the Cash Advance Deposit to be transferred to an
account with the Liquidity Provider (which account will then
become the Collateral Account).
(b) If at any time during a Liquidity Collateralisation Period a
short term credit rating of the Liquidity Provider is upgraded
so that it has a rating from S&P of A-1+ and from Moody's of
P-1, the Trust Manager must direct the Trustee to, and the
Trustee must within 5 Business Days of being so directed,
repay to the Liquidity Provider the balance of the Collateral
Account.
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3.9 Interest Cash Advance Deposit
All interest accrued on the Cash Advance Deposit shall belong to the
Liquidity Provider and all interest credited to the Cash Advance
Deposit shall be paid to the Liquidity Provider on each relevant
Payment Date in accordance with the Series Notice.
4. FUNDING PERIODS
(a) Subject to this clause, the Funding Period for a Liquidity
Draw commences on its Drawdown Date and ends on the Payment
Date in the Quarter following the Quarter in which that
Drawdown Date occurred.
(b) Notwithstanding paragraph (a), no Funding Period may extend
beyond the Final Repayment Date.
5. INTEREST
5.1 Accrual
Interest accrues daily on the outstanding principal amount of each
Liquidity Draw at the rate per annum equal to the sum of the Margin and
the Bank Bill Rate for the relevant Funding Period, calculated on
actual days elapsed and a year of 365 days.
5.2 Payment
The Trustee shall pay accrued interest on each Liquidity Draw in
respect of its Funding Period in arrear on each Payment Date and on
repayment or prepayment of all or the relevant part of the Liquidity
Draw.
5.3 Capitalisation
Interest payable under this clause 5 which is not paid when due will
immediately be capitalised. Interest is payable on capitalised interest
at the rate and in the manner referred to in this clause 5.
6. COMMITMENT FEE
(a) A commitment fee accrues due from day to day from the date of
this agreement at:
(i) if a Collateral Account has been opened and is
maintained on the relevant day, [0.15%] per annum on
the daily amount of the Available Liquidity Amount
(if any); and
(ii) in any other case, [0.10%] per annum on the daily
amount of the Available Liquidity Amount (if any).
(b) The commitment fee is calculated on the actual number of days
elapsed and a year of 365 days.
(c) The Trust Manager directs the Trustee to, and the Trustee
shall, pay to the Liquidity Provider any accrued commitment
fee in arrear on:
(i) each Payment Date; and
(ii) at the end of the Term,
in accordance with the Series Notice.
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7. CANCELLATION OF LIQUIDITY LIMIT
7.1 During Term
On giving not less than 5 Business Days irrevocable notice to the
Liquidity Provider the Trustee may cancel all or part of the Liquidity
Limit during the Term if each Designated Rating Agency has confirmed
that such cancellation will not result in a downgrading of the credit
rating assigned by each of the Designated Rating Agencies to the Notes.
A partial cancellation must be in a minimum of $100,000 and a whole
multiple of $10,000 unless the Liquidity Provider agrees otherwise.
7.2 At end of Term
At the close of business (Sydney time) on the last day of the Term the
Liquidity Limit will be cancelled.
8. REPAYMENT
8.1 Final repayment
The Trustee shall repay the Liquidity Outstandings on the Final
Repayment Date, together with all interest and other moneys owing to
the Liquidity Provider under this agreement.
8.2 Repayment of Liquidity Draws
Subject to the terms of this agreement, the Trustee must repay each
Liquidity Draw on the last day of its Funding Period, to the extent
that amounts are available for that purpose under clause 6.10(a)(iv) of
the Series Notice. Those repayments will be applied against Liquidity
Draws in chronological order of their Drawdown Dates.
8.3 Repayments during Liquidity Collateralisation Period
During a Liquidity Collateralisation Period, all repayments or
prepayments in respect of Liquidity Outstandings must be made to the
Collateral Account.
9. PREPAYMENTS
9.1 Voluntary prepayments
The Trustee may prepay all or part of the Liquidity Outstandings with
the consent of the Liquidity Provider and on at least 5 Business Days'
notice. The Trustee shall prepay in accordance with that notice.
9.2 Interest
When the Trustee prepays any amount of the Liquidity Outstandings, it
shall also pay any interest accrued on that amount.
9.3. Limitation on prepayments
The Trustee may not prepay all or any part of the Liquidity
Outstandings except as set out in this agreement.
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10. PAYMENTS
10.1 Manner
Subject to clause 8.3, the Trustee shall make all payments under this
agreement:
(a) by cheque, electronic funds transfer or other agreed method to
the Liquidity Provider at its address for service of notices
or by transfer of immediately available funds to the account
specified by the Liquidity Provider and, in either case, by
4.00 pm (Sydney time) on the due date; and
(b) without set-off, counterclaim or other deduction, except any
compulsory deduction for Taxation; and
(c) in accordance with the directions of the Trust Manager, the
Master Trust Deed and the Series Notice.
10.2 Payment to be made on Business Day
If any payment is due on a day which is not a Business Day, the due
date will be the next Business Day.
10.3. Appropriation where insufficient moneys available
Subject to any express provision of this agreement, the Liquidity
Provider may appropriate amounts it receives as between principal,
interest and other amounts then payable as it sees fit. This will
override any appropriation made by the Trustee.
11. CHANGES IN LAW
11.1 Additional payments
Whenever the Liquidity Provider determines that:
(a) the effective cost to the Liquidity Provider of making,
funding or maintaining any Liquidity Draw or the Liquidity
Limit is increased in any way;
(b) any amount paid or payable to the Liquidity Provider or
received or receivable by the Liquidity Provider, or the
effective return to the Liquidity Provider, under or in
respect of this agreement is reduced in any way;
(c) the return of the Liquidity Provider on the capital which is
or becomes directly or indirectly allocated by the Liquidity
Provider to any Liquidity Draw or the Liquidity Limit is
reduced in any way; or
(d) to the extent any relevant law, official directive or request
relates to or affects the Liquidity Limit, any Liquidity Draw
or this agreement, the overall return on capital of the
Liquidity Provider or any of its holding companies is reduced
in any way,
as a result of any change in, any making of or any change in the
interpretation or application by any Government Agency of, any law,
official directive or request, then:
(c) (when it has calculated the effect of the above and the amount
to be charged to the Trustee under this clause) the Liquidity
Provider shall promptly notify the Trust Manager and the
Trustee; and
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(d) on the following Payment Date the Trustee shall, subject
to clause 6 of the Series Notice, pay for the account of
the Liquidity Provider the amount certified by an
Authorised Signatory of the Liquidity Provider to be
necessary to compensate the Liquidity Provider for the
increased cost or the reduction (from the date of the
notice).
Without limiting the above in any way, this clause applies:
(g) to any law, official directive or request with respect to
Taxation (other than any Tax on the net income of any
person) or reserve, liquidity, capital adequacy, special
deposit or similar requirements;
(h) to official directives or requests which do not have the
force of law where it is the practice of responsible
bankers or financial institutions in the country
concerned to comply with them; and
(i) where the increased cost or the reduction arises because
the Liquidity Provider is restricted in its capacity to
enter other transactions, is required to make a payment,
or forgoes or earns reduced interest or other return on
any capital or on any sum calculated by reference in any
way to the amount of any Liquidity Draw, the Liquidity
Limit or to any other amount paid or payable or received
or receivable under this agreement or allocates capital
to any such sum.
11.2 Minimisation
(a) (No defence) If the Liquidity Provider has acted in good
faith it will not be a defence that any cost, reduction
or payment referred to in this clause could have been
avoided.
(b) (Minimisation) The Liquidity Provider shall use
reasonable endeavours to minimise any cost, reduction or
payment referred to in this clause.
11.3 Survival
This clause survives the repayment of any relevant Liquidity Draw and
the termination of this agreement.
12. CONDITIONS PRECEDENT
12.1 Conditions precedent to initial Drawdown Notice
The right of the Trustee to give the initial Drawdown Notice and the
obligations of the Liquidity Provider under this agreement are
subject to the condition precedent that the Liquidity Provider
receives all of the following in form and substance satisfactory to
the Liquidity Provider:
(a) (verification certificate) a certificate in relation to
the Trustee given by a director of the Trustee
substantially in the form of annexure B with the
attachments referred to and dated not earlier than 14
days before the first Drawdown Date;
(b) (Trust Documents) a certified copy of each duly executed
and (where relevant) stamped Trust Document;
(c) (Master Trust Deed conditions precedent) evidence that
the conditions precedent referred to in clause 13 of the
Master Trust Deed have been satisfied;
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(d) (Security Trust Deed) evidence that the Security Trust
Deed has been or will be registered with each relevant
Governmental Agency free from all prior Security
Interests and third party rights and interests; and
(e) Notes) evidence that the Notes have been issued.
12.2 Conditions precedent to each Liquidity Draw
The obligations of the Liquidity Provider to make available each
Liquidity Draw are subject to the further conditions precedent that no
Event of Default subsists at the date of the relevant Drawdown Notice
and the relevant Drawdown Date or will result from the provision of the
Liquidity Draw.
13. REPRESENTATIONS AND WARRANTIES
13.1 Representations and warranties
The Trustee, in its capacity as trustee of the Trust, makes the
following representations and warranties (so far as they relate to the
Trust).
(a) (Status) It is a corporation validly existing under the laws
of the place of its incorporation specified in this agreement.
(b) (Power) It has the power to enter into and perform its
obligations under the Trust Documents to which it is expressed
to be a party, to carry out the transactions contemplated by
those documents and to carry on its business as now conducted
or contemplated.
(c) (Corporate authorisations) It has taken all necessary
corporate action to authorise the entry into and performance
of the Trust Documents to which it is expressed to be a party,
and to carry out the transactions contemplated by those
documents.
(d) (Documents binding) Each Trust Document to which it is
expressed to be a party is its valid and binding obligation
enforceable in accordance with its terms, subject to any
necessary stamping and registration and to laws, defences and
principles of equity generally affecting creditors' rights.
(e) (Transactions permitted) The execution and performance by it
of the Trust Documents to which it is expressed to be a party
and each transaction contemplated under those documents do not
violate in any respect a provision of:
(i) a law or treaty or a judgment, ruling, order or
decree of a Government Body binding on it;
(ii) its memorandum or articles of association or other
constituent documents; or
(iii) any other document or agreement which is binding on
it or its assets,
and, except as provided by the Trust Documents, did not and
will not:
(iv) create or impose a Security Interest on any of its
assets; or
(v) allow a person to accelerate or cancel an obligation
with respect to any indebtedness in respect of
financial accommodation, or constitute an event
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of default, cancellation event, prepayment event or
similar event (whatever called) under an agreement
relating to any such indebtedness, whether
immediately or after notice or lapse of time or both.
(f) (Authorisations) Each Authorisation which is required
in relation to:
(i) the execution, delivery and performance by
it of the Trust Documents to which it is
expressed to be a party and the transactions
contemplated by those documents;
(ii) the validity and enforceability of those
documents; and
(iii) its business as now conducted or
contemplated and which is material,
has been obtained or effected. Each is in full force
and effect. It has complied with each of them. It has
paid all applicable fees for each of them.
(g) (No misrepresentation) All information provided by it
to the Liquidity Provider is true in all material
respects at the date of this agreement or, if later,
when provided.
(h) (Agreements disclosed) Each document or agreement to
which it is a party which is material to the Trust
Documents or which has the effect of varying a Trust
Document has been disclosed to the Liquidity Provider
in writing.
(i) (Trust) The Trust has been validly created and is in
existence at the date of this agreement.
(j) (Trust power) It is empowered by the Master Trust
Deed:
(i) to enter into and perform the Trust
Documents to which it is expressed to be a
party and to carry on the transactions
contemplated by those documents; and
(ii) to carry on the business of the Trust and to
own the Assets of the Trust,
in its capacity as trustee of the Trust. There is no
restriction on or condition of its doing so.
(k) (Trust authorisations) All necessary resolutions have
been duly passed and all consents, approvals and
other procedural matters have been obtained or
attended to as required by the Master Trust Deed for
it to enter into and perform the Trust Documents to
which it is expressed to be a party.
(l) (Sole trustee) It has been validly appointed as
trustee of the Trust and is the sole trustee of the
Trust.
(m) (Removal) No notice has been given to it, and so far
as it is aware no resolution has been passed or
direction or notice has been given removing it as
trustee of the Trust.
(n) (No resettlement) Other than as permitted by the
Trust Documents, it has not taken any action that
will cause the property of the Trust to be
re-settled, set aside or transferred to any other
trust.
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(o) (No termination) It has not taken any action that
will cause the Trust to be terminated, nor has it
taken any action that will result in the vesting of
the assets of the Trust.
(p) (Right of indemnity) It has not taken any action
which will limit its right of indemnity out of, and
lien over, the Assets of the Trust.
(q) (Compliance with Master Trust Deed) It has complied
with its obligations and duties under the Master
Trust Deed, the Series Notice and (to the best of its
knowledge and belief) at law. No one has alleged that
it has not so complied.
13.2 Reliance on representations and warranties
The Trustee acknowledges that the Liquidity Provider has entered the
Trust Documents in reliance on the representations and warranties in
this clause.
14. UNDERTAKINGS
14.1 General undertakings
Each of the Trustee and the Trust Manager undertake to the Liquidity
Provider as follows in relation to the Trust, except to the extent that
the Liquidity Provider consents.
(a) (Authorisations) It will ensure that each Authorisation
required for:
(i) the execution, delivery and performance by it of the
Trust Documents to which it is expressed to be a
party and the transactions contemplated by those
documents;
(ii) the validity and enforceability of those documents;
and
(iii) the carrying on by it of its business as now
conducted or contemplated,
is obtained and promptly renewed and maintained in full force
and effect. It will pay all applicable fees for them. It will
provide copies promptly to the Liquidity Provider when they
are obtained or renewed.
(b) (Negative pledge) It will not create or allow to exist a
Security Interest over the Assets of the Trust other than:
(i) under the Trust Documents; or
(ii) a lien arising by operation of law in the ordinary
course of day-to-day trading and not securing
indebtedness in respect of financial accommodation
where it duly pays the indebtedness secured by that
lien other than indebtedness contested in good faith.
(c) (Comply with obligations) It will duly and punctually comply
with its obligations under the Trust Documents.
(d) (Notice to Liquidity Provider) It will notify the Liquidity
Provider and each Designated Rating Agency as soon as it
becomes aware of:
(i) any Event of Default; and
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(ii) any proposal by a Government Agency to acquire
compulsorily any Assets of the Trust.
14.2 Undertakings relating to Trust
The Trustee, as trustee of the Trust, undertakes to the Liquidity
Provider as follows, except to the extent that the Liquidity Provider
consents.
(a) (Amendment to Master Trust Deed) It will not consent to any
amendment to the Master Trust Deed, the Series Notice or any
other Trust Document would change:
(i) the basis upon which the amount of any Liquidity Draw
to be made is calculated;
(ii) the entitlement of the Trustee to make any Liquidity
Draw; or
(iii) the basis of calculation or order of application of
any amount to be paid or applied under clause 6 of
the Series Notice.
(b) (Resettlement) It will not take any action that will result in
a resettlement, setting aside or transfer of any asset of the
Trust other than a transfer which complies with the Master
Trust Deed, the Series Notice and the other Trust Documents.
(c) (No additional trustee) It will act continuously as trustee of
the Trust in accordance with the Master Trust Deed until the
Trust has been terminated or until it has retired or been
removed in accordance with the Master Trust Deed.
14.3 Term of undertakings
Each undertaking in this clause continues from the date of this
agreement until all moneys actually or contingently owing under this
agreement are fully and finally repaid.
15. EVENTS OF DEFAULT
15.1 Events of Default
Each of the following is an Event of Default (whether or not it is in
the control of the Trustee).
(a) (Payments)
(i) At any time the Available Liquidity Amount is zero,
the Trustee fails to pay an amount payable by it
under this agreement within 10 Business Days of its
due date.
(ii) An amount is available for payment under clause 8 and
the Trustee does not pay that amount.
(b) (Insolvency Event) An Insolvency Event occurs:
(i) in relation to the Trust (as if it was a relevant
corporation for the purposes of the definition of
Insolvency Event); or
(ii) in relation to the Trustee, and a successor trustee
of the Trust is not appointed with 30 days of that
Insolvency Event.
(c) (Termination Date) The Termination Date occurs in relation to
the Trust.
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(d) (Vitiation) All or any part of this agreement is terminated or
is or becomes void, illegal, invalid or unenforceable.
15.2 Consequences
In addition to any other rights provided by law or any Trust Document,
at any time after an Event of Default (whether or not it is continuing)
the Liquidity Provider may do all or any of the following:
(a) by notice to the Trustee and the Trust Manager declare all
moneys actually or contingently owing under this agreement
immediately due and payable, and the Trustee will immediately
pay the Liquidity Outstandings together with accrued interest
and fees and all such other moneys; and
(b) by notice to the Trustee and the Trust Manager cancel the
Liquidity Limit with effect from any date specified in that
notice.
16. INTEREST ON OVERDUE AMOUNTS
16.1 Accrual
Interest accrues on each unpaid amount which is due and payable by the
Trustee under or in respect of this agreement (including interest
payable under this clause):
(a) on a daily basis up to the date of actual payment from (and
including) the due date or, in the case of an amount payable
by way of reimbursement or indemnity, the date of disbursement
or loss, if earlier;
(b) both before and after judgment (as a separate and independent
obligation); and
(c) at the rate determined by the Liquidity Provider to be the sum
of 2% per annum plus the higher of:
(i) the rate (if any) applicable to the unpaid amount
immediately before the due date; and
(ii) the One Month Bank Bill Rate on the first day of
each Funding Period, plus the Margin.
16.2 Payment
The Trustee shall pay interest accrued under this clause on demand and
on each Payment Date, to the extent that amounts are available for that
purpose under clause 6.10(a)(iii) of the Series Notice.
16.3 Limitation
Clause 16.1 will only apply in relation to any unpaid Liquidity Draw
if, at the time the Liquidity Draw was required to be paid, the
aggregate of all Liquidity Draws was equal to or greater than the
Liquidity Limit.
17. CONTROL ACCOUNTS
The accounts kept by the Liquidity Provider constitute sufficient
evidence, unless proven wrong, of the amount at any time due from the
Trustee under this agreement.
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18. WAIVERS, REMEDIES CUMULATIVE
(a) No failure to exercise and no delay in exercising any right,
power or remedy under this agreement operates as a waiver. Nor
does any single or partial exercise of any right, power or
remedy preclude any other or further exercise of that or any
other right, power or remedy.
(b) The rights, powers and remedies provided to the Liquidity
Provider in this agreement are in addition to, and do not
exclude or limit, any right, power or remedy provided by law.
19. SEVERABILITY OF PROVISIONS
Any provision of this agreement which is prohibited or unenforceable in
any jurisdiction is ineffective as to that jurisdiction to the extent
of the prohibition or unenforceability. That does not invalidate the
remaining provisions of this agreement nor affect the validity or
enforceability of that provision in any other jurisdiction.
20. SURVIVAL OF REPRESENTATIONS
All representations and warranties in this agreement survive the
execution and delivery of this agreement and the provision of advances
and accommodation.
21. INDEMNITY AND REIMBURSEMENT OBLIGATION
Unless stated otherwise, each indemnity, reimbursement or similar
obligation in this agreement:
(a) is a continuing obligation;
(b) is a separate and independent obligation;
(c) is payable on demand; and
(d) survives termination or discharge of this agreement.
22. MORATORIUM LEGISLATION
To the full extent permitted by law all legislation which at any time
directly or indirectly:
(a) lessens, varies or affects in favour of the Trustee any
obligation under a Trust Document; or
(b) delays, prevents or prejudicially affects the exercise by the
Liquidity Provider of any right, power or remedy conferred by
this agreement, is excluded from this agreement.
23. CONSENTS AND OPINIONS
Except where expressly stated the Liquidity Provider may give or
withhold, or give conditionally, approvals and consents, may be
satisfied or unsatisfied, may form opinions, and may exercise its
rights, powers and remedies, at its absolute discretion.
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24. ASSIGNMENTS
No party may assign or transfer any of its rights or obligations under
this agreement without the prior written consent of the other parties,
or if the rating of the Notes would be withdrawn or reduced as a result
of the assignment.
25. NOTICES
All notices, requests, demands, consents, approvals, agreements or
other communications to or by a party to this agreement:
(a) must be in writing;
(b) must be signed by an Authorised Signatory of the sender; and
(c) will be taken to be duly given or made:
(i) (in the case of delivery in person or by post) when
delivered, received or left at the address of the
recipient shown in this agreement or to any other
address which it may have notified the sender;
(ii) (in the case of facsimile transmission) on receipt of
a transmission report confirming successful
transmission; and
(iii) (in the case of a telex) on receipt by the sender of
the answerback code of the recipient at the end of
transmission,
but if delivery or receipt is on a day on which business is
not generally carried on in the place to which the
communication is sent or is later than 4.00 pm (local
time), it will be taken to have been duly given or made at
the commencement of business on the next day on which
business is generally carried on in that place.
26. AUTHORISED SIGNATORIES
The Trustee irrevocably authorises the Liquidity Provider to rely on a
certificate by persons purporting to be its directors and/or
secretaries as to the identity and signatures of its Authorised
Signatories. The Trustee warrants that those persons have been
authorised to give notices and communications under or in connection
with this agreement.
27. GOVERNING LAW AND JURISDICTION
This agreement is governed by the laws of [New South Wales]. The
Trustee submits to the non-exclusive jurisdiction of courts exercising
jurisdiction there.
28. COUNTERPARTS
This agreement may be executed in any number of counterparts. All
counterparts together will be taken to constitute one instrument.
29. ACKNOWLEDGEMENT BY TRUSTEE
The Trustee confirms that:
(a) it has not entered into this agreement in reliance on, or as a
result of, any statement or conduct of any kind of or on
behalf of the Liquidity Provider (including any advice,
warranty, representation or undertaking); and
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(b) the Liquidity Provider is not obliged to do anything
(including disclose anything or give advice), except as
expressly set out in this agreement.
30. LIMITED RECOURSE
30.1 General
Clause 33 of the Master Trust Deed applies to the obligations and
liabilities of the Trustee and the Trust Manager under this agreement.
30.2 Liability of Trustee limited to its right to indemnity
(a) This agreement applies to the Trustee only in its capacity as
trustee of the Trust and in no other capacity. A liability
arising under or in connection with this agreement or the
Trust can be enforced against the Trustee only to the extent
to which it can be satisfied out of property of the Trust out
of which the Trustee is actually indemnified for the
liability. This limitation of the Trustee's liability applies
despite any other provision of this agreement and extends to
all liabilities and obligations of the Trustee in any way
connected with any representation, warranty, conduct,
omission, agreement or transaction related to this agreement
or the Trust.
(b) The parties other than the Trustee may not sue the Trustee in
any capacity other than as trustee of the Trust or seek the
appointment of a receiver (except under the Security Trust
Deed), or a liquidator, an administrator or any similar person
to the Trustee or prove in any liquidation, administration or
arrangements of or affecting the Trustee.
(c) The provisions of this clause 30 shall not apply to any
obligation or liability of the Trustee to the extent that it
is not satisfied because under a Transaction Document or by
operation of law there is a reduction in the extent of the
Trustee's indemnification out of the Assets of the Trust as a
result of the Trustee's fraud, negligence or breach of trust.
(d) It is acknowledged that the Trust Manager, the Servicer, the
Note Trustee, the Principal Paying Agent, the other Paying
Agents and the Agent Bank (each a Relevant Party) are
responsible under this agreement and the other Transaction
Documents for performing a variety of obligations relating to
the Trust. No act or omission of the Trustee (including any
related failure to satisfy its obligations under this
agreement) will be considered fraud, negligence or breach of
trust of the Trustee for the purpose of sub-paragraph (c) to
the extent to which the act or omission was caused or
contributed to by any failure by any Relevant Party or any
other person who provides services in respect of the Trust
(other than a person who has been delegated or appointed by
the Trustee and for whom the Trustee is responsible under this
agreement or the relevant Transaction Documents, but excluding
any Relevant Party) to fulfil its obligations relating to the
Trust or by any other act or omission of a Relevant Party or
any other person who provides services in respect of the Trust
(other than a person who has been delegated or appointed by
the Trustee and for whom the Trustee is responsible under this
agreement or the relevant Transaction Documents, but excluding
any Relevant Party).
(e) No attorney, agent, receiver or receiver and manager appointed
in accordance with this agreement or any other Transaction
Documents (including a Relevant Party) has authority to act on
behalf of the Trustee in a way which exposes the Trustee to
any
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personal liability and no act or omission of any such
person will be considered fraud, negligence or breach of trust
of the Trustee for the purpose of sub-paragraph (c), if the
Trustee has exercised reasonable care in the selection and
supervision of such a person.
30.3 Unrestricted remedies
Nothing in clause 30.2 limits the Liquidity Provider in:
(a) obtaining an injunction or other order to restrain any breach
of this agreement by any party;
(b) obtaining declaratory relief; or
(c) in relation to its rights under the Security Trust Deed.
30.4 Restricted remedies
Except as provided in clause 30.3, the Liquidity Provider shall not:
(a) (judgment) obtain a judgment for the payment of money or
damages by the Trustee;
(b) (statutory demand) issue any demand under s459E(1) of the
Corporations Law (or any analogous provision under any other
law) against the Trustee;
(c) (winding up) apply for the winding up or dissolution of the
Trustee;
(d) (execution) levy or enforce any distress or other execution
to, on, or against any assets of the Trustee;
(e) (court appointed receiver) apply for the appointment by a
court of a receiver to any of the assets of the Trustee;
(f) (set-off or counterclaim) exercise or seek to exercise any
set-off or counterclaim against the Trustee; or
(g) (administrator) appoint, or agree to the appointment, of any
administrator to the Trustee,
or take proceedings for any of the above and the Liquidity Provider
waives its rights to make those applications and take those
proceedings.
31. LIQUIDITY PROVIDER'S OBLIGATIONS
The Trustee shall have no recourse to the Liquidity Provider in
relation to this agreement beyond its terms, and the Liquidity
Provider's obligations under this agreement are separate from, and
independent to, any obligations the Liquidity Provider may have to the
Trustee for any other reason (including under any other Trust
Document).
32. SUCCESSOR TRUSTEE
The Liquidity Provider shall do all things reasonably necessary to
enable any successor Trustee appointed under clause 24 of the Master
Trust Deed to become the Trustee under this agreement.
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EXECUTED in Sydney.
Each attorney executing this agreement states that he has no notice of
revocation or suspension of his power of attorney.
SIGNED on behalf of )
WESTPAC SECURITIES )
ADMINISTRATION LIMITED )
by its attorney )
in the presence of: ) ------------------------------
Signature
- -------------------------------------- ------------------------------
Witness Print name
- --------------------------------------
Print name
SIGNED on behalf of )
WESTPAC BANKING CORPORATION )
by its attorney in the )
presence of: ) -----------------------------
Signature
- -------------------------------------- -----------------------------
Witness Print name
- --------------------------------------
Print name
SIGNED on behalf of )
WESTPAC SECURITISATION )
MANAGEMENT PTY LIMITED by its )
attorney in the presence of: ) -----------------------------
Signature
- -------------------------------------- -----------------------------
Witness Print name
- --------------------------------------
Print name
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ANNEXURE A
DRAWDOWN NOTICE
To: Westpac Banking Corporation
LIQUIDITY FACILITY AGREEMENT - DRAWDOWN NOTICE NO. [*]
We refer to the Liquidity Facility Agreement dated [*] 1998 (the Facility
Agreement).
Under clause 3.1 of the Liquidity Facility Agreement we give you irrevocable
notice as follows:
(1) we wish to draw on [*] (the Drawdown Date); [NOTE: Date is to be a
Business Day.]
(2) the total principal amount to be drawn is [*]; [NOTE: Amount to comply
with the limits in clause 3.]
(3) particulars of [each/the] Liquidity Draw are as follows:
Principal amount Funding Period
[NOTE: Length of Funding Period to comply with clause 4.]
(4) we request that the proceeds be remitted to account number [*] at [*];
[NOTE: The account(s) to be completed only if funds not required in
repayment of any previous Liquidity Draw(s).]
(5) we represent and warrant that no Event of Default under the Facility
Agreement subsists or will result from the drawing.
Definitions in the Facility Agreement apply in this Drawdown Notice.
WESTPAC SECURITIES ADMINISTRATION LIMITED as trustee of the Series 1997-4E WST
Trust
By: [Authorised Signatory]
DATED
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ANNEXURE B
VERIFICATION CERTIFICATE
To: Westpac Banking Corporation
LIQUIDITY FACILITY AGREEMENT
I [*] am a [director] of Westpac Securities Administration Limited of [*] 1998
(the Company).
I refer to the Liquidity Facility Agreement (the Facility Agreement) dated [*]
between the Company as Trustee, Westpac Banking Corporation and Westpac
Securitisation Management Pty Limited.
Definitions in the Facility Agreement apply in this Certificate.
I CERTIFY as follows.
1. Attached to this Certificate are complete and up to date copies of:
(a) unless paragraph 2 below applies, the memorandum and articles
of association of the Company (marked A); and
(b) a power of attorney granted by the Company for the execution
of the Facility Agreement to which it is expressed to be a
party (marked B). That power of attorney has not been revoked
or suspended by the Company and remains in full force and
effect.
2. If the memorandum and articles of association of the Company are not
attached to this certificate, there has been no change to them since
the Company last gave a certified copy of them to Westpac Banking
Corporation.
3. The following are signatures of the Authorised Signatories of the
Company and the persons who have been authorised to sign the Facility
Agreement and to give notices and communications under or in
connection with the Facility Agreement. If no signatures are set out
below, the Authorised Signatories with respect to the Facility
Agreement are the same as in relation to the Series 1997-3 WST Trust,
a copy of those signatures having previously been provided to Westpac
Banking Corporation.
Authorised Signatories
Name Position Signature
* * -----------------------------
* * -----------------------------
* * -----------------------------
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Signatories
Name Position Signature
* * -----------------------------
* * -----------------------------
* * -----------------------------
Signed:
------------------------
Director
------------------------
Print name
DATED
<PAGE>
Exhibit 10.4
WESTPAC SECURITIES ADMINISTRATION LIMITED
(Trustee)
WESTPAC BANKING CORPORATION
(Redraw Facility Provider)
and
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED
(Trust Manager)
--------------------------------------------
--------------------------------------------
SERIES 1998-1G WST TRUST
REDRAW FACILITY AGREEMENT
--------------------------------------------
--------------------------------------------
(C) Allen Allen & Hemsley
Sydney
Ref: AEJ [*]
<PAGE>
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T A B L E O F C O N T E N T S
- --------------------------------------------------------------------------------
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1. DEFINITIONS AND INTERPRETATION .................... 1
1.1 Definitions ....................................... 1
1.2 Master Trust Deed definitions ..................... 3
1.3 Interpretation .................................... 3
1.4 Determination, statement and certificate sufficient
evidence .......................................... 3
1.5 Transaction Document .............................. 3
1.6 Limited to Trust .................................. 3
2. PURPOSE ........................................... 4
3. DRAWINGS .......................................... 4
3.1 Redraw Advance .................................... 4
3.2 Making of Redraw Advances ......................... 4
4. FEES .............................................. 4
4.1 Availability fee .................................. 4
4.2 Draw Fee .......................................... 5
4.3 Capitalisation .................................... 5
5. CANCELLATION OF REDRAW LIMIT ...................... 5
5.1 During Term ....................................... 5
5.2 At end of Term .................................... 6
5.3 Cancellation by Redraw Facility Provider .......... 6
6. REPAYMENT ......................................... 6
6.1 Repayment of Redraw Advances ...................... 6
6.2 Final repayment ................................... 6
7. PREPAYMENTS ....................................... 6
7.1 Voluntary prepayments ............................ 6
7.2 Draw Fee ......................................... 6
7.3 Limitation on prepayments ........................ 7
8. PAYMENTS ......................................... 7
8.1 Manner ........................................... 7
8.2 Payment to be made on Business Day ............... 7
8.3 Appropriation where insufficient moneys available. 7
9. CHANGES IN LAW ................................... 7
9.1 Additional payments .............................. 7
9.2 Minimisation ..................................... 8
9.3 Survival ......................................... 8
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10. CONDITIONS PRECEDENT ............................. 8
10.1 Conditions precedent to initial Drawdown Notice .. 8
10.2 Conditions precedent to each Redraw Advance ...... 9
11. REPRESENTATIONS AND WARRANTIES ................... 9
11.1 Representations and warranties ................... 9
11.2 Reliance on representations and warranties ....... 11
12. UNDERTAKINGS ..................................... 11
12.1 General undertakings ............................. 11
12.2 Undertakings relating to Trust ................... 12
12.3 Term of undertakings ............................. 12
13. EVENTS OF DEFAULT ................................ 12
13.1 Events of Default ................................ 12
13.2 Consequences ..................................... 13
14. CONTROL ACCOUNTS ................................. 13
15. WAIVERS, REMEDIES CUMULATIVE ..................... 13
16. SEVERABILITY OF PROVISIONS ....................... 13
17. SURVIVAL OF REPRESENTATIONS ...................... 13
18. INDEMNITY AND REIMBURSEMENT OBLIGATION ........... 14
19. MORATORIUM LEGISLATION ........................... 14
20. CONSENTS AND OPINIONS ............................ 14
21. ASSIGNMENTS ...................................... 14
22. NOTICES .......................................... 14
23. AUTHORISED SIGNATORIES ........................... 15
24. GOVERNING LAW AND JURISDICTION ................... 15
25. COUNTERPARTS ..................................... 15
26. ACKNOWLEDGEMENT BY TRUSTEE ....................... 15
27. LIMITED RECOURSE ................................. 15
27.1 General ................................. 15
27.2 Liability of Trustee limited to its right
to indemnity ............................ 15
27.3 Unrestricted remedies .................. 16
27.4 Restricted remedies .................... 16
28. REDRAW FACILITY PROVIDER'S OBLIGATIONS ........... 17
29. SUCCESSOR TRUSTEE ................................ 17
<PAGE>
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REDRAW FACILITY AGREEMENT
- --------------------------------------------------------------------------------
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AGREEMENT dated 1998 between:
1. WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472)
incorporated in New South Wales of Level 10, 130 Pitt Street, Sydney,
New South Wales as Trustee of the Series 1998-1G WST Trust (the
Trustee);
2. WESTPAC BANKING CORPORATION (ARBN 007 457 141) incorporated in New
South Wales of 60 Martin Place, Sydney, New South Wales (the Redraw
Facility Provider); and
3. WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 081 709 211)
incorporated in the Australian Capital Territory, of Level 6, 60 Martin
Place, Sydney, New South Wales (the Trust Manager).
RECITAL
The Trustee has requested the Redraw Facility Provider to provide the Trustee
with a redraw facility under which loans of up to an aggregate amount of $[*]
may be made available to the Trustee.
IT IS AGREED as follows.
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this agreement the following definitions apply unless the context
requires otherwise, or unless otherwise defined.
Available Redraw Amount means at any time the greater of:
(a) the Redraw Limit at the time less:
(i) the Principal Outstanding at that time;
(ii) the Carryover Redraw Charge Offs at that time; and
(b) zero.
Bank Bill Rate has the meaning given in the Series Notice, but on the
first Reset Date of any Redraw Advance the Bank Bill Rate shall be an
interpolated rate calculated with reference to the tenor of the period
from that Reset Date to (but not including) the next Reset Date.
Drawdown Date means, in relation to a Redraw Advance, the Payment Date
on which the Redraw Advance is or is to be made under this agreement.
Drawdown Notice means a notice under clause 3.1.
Event of Default means any of the events specified in clause 13.
Final Repayment Date means the date on which the Term ends.
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Master Trust Deed means the deed entitled "Master Trust Deed" between
the Trustee and the Trust Manager dated 14 February 1997.
Principal Outstanding means, at any time, the total principal amount of
all outstanding Redraw Advances at that time less the Carryover Redraw
Charge Offs at that time.
Redraw Advance means any advance made or to be made under this
agreement.
Redraw Limit means $[*], or any other amount as agreed in writing
between the Redraw Facility Provider, the Trustee and the Trust
Manager, as reduced or cancelled under this agreement, provided that
the Redraw Limit may not be increased unless the Designated Rating
Agency for each Class of Notes has confirmed in writing that the
increase would not result in a downgrading of the rating given to any
Note of the relevant Class or the withdrawal of the rating of any Note
of the relevant Class.
Reset Date means in relation to a Redraw Advance:
(a) the Drawdown Date for that Redraw Advance; and
(b) each Payment Date while that Redraw Advance is outstanding.
Series Notice means the Series Notice issued by the Trust Manager on or
about the date of this agreement under the Master Trust Deed.
Term means the period commencing on the date of this agreement and
expiring on the earliest of:
(a) the date which is one month after the Notes have been redeemed
in full in accordance with the Master Trust Deed and the
Series Notice;
(b) the date declared by the Redraw Facility Provider under clause
13.2(b);
(c) the date on which the Trustee enters into a redraw facility to
replace this agreement with any other person to enable it to
fund Redraw Shortfalls;
(d) the date on which Westpac Securitisation Management Pty
Limited retires or is removed as Trust Manager under the
Master Trust Deed;
(e) the date on which the Redraw Limit is cancelled in full by the
Trustee under clause 5.1;
(f) the date which is one year after the Maturity Date; and
(g) the date on which the Redraw Limit is cancelled in full by the
Redraw Facility Provider under clause 5.3.
Trust means the Series 1998-1G WST Trust constituted under the Master
Trust Deed on the terms of the Series Notice.
Trust Document means:
(a) this agreement;
(b) the Master Trust Deed;
(c) the Notice of Creation of Trust;
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(d) the Series Notice;
(e) the Bond Trust Deed;
(f) the Agency Agreement;
(g) the Security Trust Deed; and
(h) the Servicing Agreement.
Trustee means the trustee of the Trust at the date of this agreement or
any person which becomes a successor trustee under clause 24 of the
Master Trust Deed.
1.2 Master Trust Deed definitions
Words and expressions which are defined in the Master Trust Deed (as
amended by the Series Notice) and the Series Notice (including in each
case by reference to another agreement) have the same meanings when
used in this agreement, unless the context otherwise requires or unless
otherwise defined in this agreement.
1.3 Interpretation
Clause 1.2 of the Master Trust Deed applies to this agreement as if set
out in full, except that references to this deed are references to this
agreement and:
(a) a reference to an asset includes any real or personal, present
or future, tangible or intangible property or asset and any
right, interest, revenue or benefit in, under or derived from
the property or asset;
(b) an Event of Default subsists until it has been waived in
writing by the Redraw Facility Provider; and
(c) a reference to an amount for which a person is contingently
liable includes an amount which that person may become
actually or contingently liable to pay if a contingency
occurs, whether or not that liability will actually arise.
1.4 Determination, statement and certificate sufficient evidence
Except where otherwise provided in this agreement any determination,
statement or certificate by the Redraw Facility Provider or an
Authorised Signatory of the Redraw Facility Provider provided for in
this agreement is sufficient evidence unless proven wrong.
1.5 Transaction Document
This agreement is a Transaction Document for the purposes of the Master
Trust Deed.
1.6 Limited to Trust
The rights and obligations of the parties under this agreement relate
only to the Trust, and do not relate to any other Trust (as defined in
the Master Trust Deed). Without limitation, the Redraw Facility
Provider has no obligation under this agreement to provide financial
accommodation to the Trustee as trustee of any other such Trust.
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2. PURPOSE
The Trust Manager directs to the Trustee to, and the Trustee shall,
apply the proceeds of each Redraw Advance to fund Redraw Shortfalls in
relation to the Trust by paying it to Westpac in accordance with clause
6.3 of the Series Notice, and for no other purpose.
3. DRAWINGS
3.1 Redraw Advance
(a) Subject to this agreement, if on any Determination Date the
Trust Manager determines that there is a Redraw Shortfall in
relation to the Collection Period ending immediately prior to
that Determination Date the Trust Manager must, and the
Trustee shall (subject to this agreement and the Series
Notice), direct the Trustee to request a Redraw Advance by
giving to the Redraw Facility Provider a Drawdown Notice.
(b) A Drawdown Notice must be:
(i) in writing;
(ii) in or substantially in the form of Annexure A;
(iii) signed by the Trustee; and
(iv) given not later than 11.00 am (Sydney time) on the
Remittance Date following that Collection Period.
(c) The amount requested in a Drawdown Notice must be the lesser
of:
(i) the relevant Redraw Shortfall; and
(ii) the Available Redraw Amount at that time (but
assuming the repayment of all Redraw Advances due to
be repaid on or before the relevant Drawdown Date).
3.2 Making of Redraw Advances
(a) Subject to the terms of this agreement, a Redraw Advance
requested in a Drawdown Notice shall be made available by the
Redraw Facility Provider paying the proceeds of that Redraw
Advance to Westpac.
(b) The Redraw Facility Provider is not obliged to provide a
Redraw Advance if as a result the aggregate of Principal
Outstanding and the Carryover Redraw Charge Offs would exceed
the Redraw Limit.
4. FEES
4.1 Availability fee
(a) An availability fee accrues at [0.02%] per annum on the daily
amount of the Available Redraw Amount (if any) due from day to
day from the date of this agreement.
(b) The availability fee is calculated on the actual number of
days elapsed and a year of 365 days.
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(c) The Trust Manager directs the Trustee to, and the Trustee
shall, pay to the Redraw Facility Provider any accrued
availability fee in arrear on:
(i) each Payment Date; and
(ii) at the end of the Term.
4.2 Draw Fee
(a) A draw fee accrues due from day to day on the daily amount of
each Redraw Advance at the following rates:
(i) the sum of [0.12%] per annum and the Bank Bill Rate
calculated as of that date (if that date is a Reset
Date) or (otherwise) the Reset Date immediately
before that date, if the Redraw Advance has been
outstanding for less than 12 months; and
(ii) the sum of [0.22%] per annum and the Bank Bill Rate
calculated as of that date (if that date is a Reset
Date) or (otherwise) the Reset Date immediately
before that date, if the Redraw Advance has been
outstanding for 12 months or more.
(b) Each draw fee is calculated on the actual number of days
elapsed and a year of 365 days.
(c) The Trust Manager directs the Trustee to, and the Trustee
shall, pay to the Redraw Facility Provider any accrued draw
fee in arrear on:
(i) each Payment Date; and
(ii) at the end of the Term.
(d) The Bank Bill Rate as at any date will be the Bank Bill Rate
determined:
(i) if that date is a Payment Date, on that Payment Date;
and
(ii) on any other date, on the Payment Date immediately
preceding that date.
4.3 Capitalisation
Any draw fee payable under this clause 4 which is not paid when due
will immediately be capitalised. The draw fee is payable on any
capitalised amount at the rate and in the manner referred to in this
clause 4.
5. CANCELLATION OF REDRAW LIMIT
5.1 During Term
(a) On giving not less than 5 Business Days irrevocable notice to
the Redraw Facility Provider the Trustee may cancel all or
part of the Redraw Limit during the Term.
(b) A partial cancellation must be in a minimum of $100,000 and a
whole multiple of $10,000 unless the Redraw Facility Provider
agrees otherwise.
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5.2 At end of Term
At the close of business (Sydney time) on the last day of the Term the
Redraw Limit will be cancelled.
5.3 Cancellation by Redraw Facility Provider
(a) The Redraw Facility Provider may cancel all or part of the
Redraw Limit during the Term immediately on giving notice to
the Trustee and the Trust Manager. The Redraw Limit shall be
reduced by the amount of that cancellation on that notice.
(b) On each Payment Date following that cancellation, the Trustee
shall pay to the Redraw Facility Provider the lesser of:
(i) an amount equal to the Principal Outstanding at that
Payment Date less the Redraw Limit at that Payment
Date (if positive); and
(ii) any amount available for distribution to the Redraw
Facility Provider under clauses 6.10(a)(v) and
6.13(a)(ii) of the Series Notice.
(c) Repayments under paragraph (b) will be applied against Redraw
Advances in chronological order of their Drawdown Dates.
(d) This clause does not affect the Redraw Facility Provider's
rights under clause 13 of this agreement or under clause
6.11(a)(ii)(D) of the Series Notice.
6. REPAYMENT
6.1 Repayment of Redraw Advances
The Trustee shall repay the Principal Outstanding on each Payment Date
and at the end of the Term, to the extent that amounts are available
for that purpose under clause 6.13(a)(iii) of the Series Notice. Those
repayments will be applied against Redraw Advances in chronological
order of their Drawdown Dates.
6.2 Final repayment
If following the Final Repayment Date, any Principal Outstanding or
Carryover Redraw Charge Off has not been repaid after the distribution
of all Assets of the Trust in accordance with the Series Notice, that
Principal Outstanding or Carryover Redraw Charge Off will be cancelled
and the Trustee will have no further obligation to pay that amount
under this agreement.
7. PREPAYMENTS
7.1 Voluntary prepayments
The Trustee may prepay all or part of the Principal Outstanding with
the consent of the Redraw Facility Provider and on at least 5 Business
Days' notice. The Trustee shall prepay in accordance with that notice.
7.2 Draw Fee
When the Trustee prepays any amount of the Principal Outstanding, it
shall also pay any draw fee accrued on that amount.
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7.3 Limitation on prepayments
The Trustee may not prepay all or any part of the Principal Outstanding
except as set out in this agreement.
8. PAYMENTS
8.1 Manner
The Trustee shall make all payments under this agreement:
(a) by cheque, electronic funds transfer or other agreed method to
the Redraw Facility Provider at its address for service of
notices or by transfer of immediately available funds to the
account specified by the Redraw Facility Provider and, in
either case, by 4.00 pm (Sydney time) on the due date; and
(b) without set-off, counterclaim or other deduction, except any
compulsory deduction for Tax; and
(c) in accordance with the directions of the Trust Manager, Master
Trust Deed and the Series Notice.
8.2 Payment to be made on Business Day
If any payment is due on a day which is not a Business Day, the due
date will be the next Business Day.
8.3 Appropriation where insufficient moneys available
Subject to any express provision of this agreement, the Redraw Facility
Provider may appropriate amounts it receives as between principal, draw
fees, interest and other amounts then payable as it sees fit. This will
override any appropriation made by the Trustee.
9. CHANGES IN LAW
9.1 Additional payments
Whenever the Redraw Facility Provider determines that:
(a) the effective cost to the Redraw Facility Provider of making,
funding or maintaining any Redraw Advance or the Redraw Limit
is increased in any way;
(b) any amount paid or payable to the Redraw Facility Provider or
received or receivable by the Redraw Facility Provider, or the
effective return to the Redraw Facility Provider, under or in
respect of this agreement is reduced in any way;
(c) the return of the Redraw Facility Provider on the capital
which is or becomes directly or indirectly allocated by the
Redraw Facility Provider to any Redraw Advance or the Redraw
Limit is reduced in any way; or
(d) to the extent any relevant law, official directive or request
relates to or affects the Redraw Limit, any Redraw Advance or
this agreement, the overall return on capital of the Redraw
Facility Provider or any of its holding companies is reduced
in any way,
as a result of any change in, any making of or any change in the
interpretation or application by any Government Agency of, any law,
official directive or request, then:
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(e) (when it has calculated the effect of the above and the amount
to be charged to the Trustee under this clause) the Redraw
Facility Provider shall promptly notify the Trust Manager and
the Trustee; and
(f) on the following Payment Date from time to time the Trustee
shall, subject to clause 6 of the Series Notice, pay for the
account of the Redraw Facility Provider the amount certified
by an Authorised Signatory of the Redraw Facility Provider to
be necessary to compensate the Redraw Facility Provider for
the increased cost or the reduction (from the date of the
notice).
Without limiting the above in any way, this clause applies:
(g) to any law, official directive or request with respect to
Taxation (other than any Tax on the net income of any person)
or reserve, liquidity, capital adequacy, special deposit or
similar requirements;
(h) to official directives or requests which do not have the
force of law where it is the practice of responsible bankers
or financial institutions in the country concerned to comply
with them; and
(i) where the increased cost or the reduction arises because the
Redraw Facility Provider is restricted in its capacity to
enter other transactions, is required to make a payment, or
forgoes or earns reduced interest or other return on any
capital or on any sum calculated by reference in any way to
the amount of any Redraw Advance, the Redraw Limit or to any
other amount paid or payable or received or receivable under
this agreement or allocates capital to any such sum.
9.2 Minimisation
(a) (No defence) If the Redraw Facility Provider has acted in good
faith it will not be a defence that any cost, reduction or
payment referred to in this clause could have been avoided.
(b) (Minimisation) The Redraw Facility Provider shall use
reasonable endeavours to minimise any cost, reduction or
payment referred to in this clause.
9.3 Survival
This clause survives the repayment of any relevant Redraw Advance and
the termination of this agreement.
10. CONDITIONS PRECEDENT
10.1 Conditions precedent to initial Drawdown Notice
The right of the Trustee to give the initial Drawdown Notice and the
obligations of the Redraw Facility Provider under this agreement are
subject to the condition precedent that the Redraw Facility Provider
receives all of the following in form and substance satisfactory to the
Redraw Facility Provider:
(a) (verification certificate) a certificate in relation to the
Trustee given by a director of the Trustee substantially in
the form of annexure B with the attachments referred to and
dated not earlier than 14 days before the first Drawdown Date;
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(b) (Trust Documents) a certified copy of each duly executed and
(where relevant) stamped Trust Document;
(c) (Master Trust Deed conditions precedent) evidence that the
conditions precedent referred to in clause 13 of the Master
Trust Deed have been satisfied;
(d) (Security Trust Deed) evidence that the Security Trust Deed
has been or will be registered with each relevant Governmental
Agency free from all prior Security Interests and third party
rights and interests; and
(e) (Notes) evidence that the Notes have been issued.
10.2 Conditions precedent to each Redraw Advance
The obligations of the Redraw Facility Provider to make available each
Redraw Advance are subject to the further conditions precedent that:
(a) (no default) no Event of Default subsists at the date of the
relevant Drawdown Notice and the relevant Drawdown Date or
will result from the provision of the Redraw Advance; and
(b) (representations true) the representations and warranties by
the Trustee in this agreement are true as at the date of the
relevant Drawdown Notice and the relevant Drawdown Date as
though they had been made at that date in respect of the facts
and circumstances then subsisting.
11. REPRESENTATIONS AND WARRANTIES
11.1 Representations and warranties
The Trustee (in its capacity as trustee of the Trust) makes the
following representations and warranties (so far as they relate to the
Trust).
(a) (Status) It is a corporation validly existing under the laws
of the place of its incorporation specified in this agreement.
(b) (Power) It has the power to enter into and perform its
obligations under the Trust Documents to which it is expressed
to be a party, to carry out the transactions contemplated by
those documents and to carry on its business as now conducted
or contemplated.
(c) (Corporate authorisations) It has taken all necessary
corporate action to authorise the entry into and performance
of the Trust Documents to which it is expressed to be a party,
and to carry out the transactions contemplated by those
documents.
(d) (Documents binding) Each Trust Document to which it is
expressed to be a party is its valid and binding obligation
enforceable in accordance with its terms, subject to any
necessary stamping and registration and to laws, defences and
principles of equity generally affecting creditors' rights.
(e) (Transactions permitted) The execution and performance by it
of the Trust Documents to which it is expressed to be a party
and each transaction contemplated under those documents do not
violate in any respect a provision of:
(i) a law or treaty or a judgment, ruling, order or
decree of a Government Body binding on it;
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(ii) its memorandum or articles of association or other
constituent documents; or
(iii) any other document or agreement which is binding on
it or its assets,
and, except as provided by the Trust Documents, did not and
will not:
(iv) create or impose a Security Interest on any of its
assets; or
(v) allow a person to accelerate or cancel an obligation
with respect to any indebtedness in respect of
financial accommodation, or constitute an event of
default, cancellation event, prepayment event or
similar event (whatever called) under an agreement
relating to any such indebtedness, whether
immediately or after notice or lapse of time or both.
(f) (Authorisations) Each Authorisation which is required in
relation to:
(i) the execution, delivery and performance by it of the
Trust Documents to which it is expressed to be a
party and the transactions contemplated by those
documents;
(ii) the validity and enforceability of those documents;
and
(iii) its business as now conducted or contemplated and
which is material,
has been obtained or effected. Each is in full force and
effect. It has complied with each of them. It has paid all
applicable fees for each of them.
(g) (No misrepresentation) All information provided by it to the
Redraw Facility Provider is true in all material respects at
the date of this agreement or, if later, when provided.
(h) (Agreements disclosed) Each document or agreement to which it
is a party and which is material to the Trust Documents or
which has the effect of varying a Trust Document has been
disclosed to the Redraw Facility Provider in writing.
(i) (Trust) The Trust has been validly created and is in existence
at the date of this agreement.
(j) (Trust power) It is empowered by the Master Trust Deed:
(i) to enter into and perform the Trust Documents to
which it is expressed to be a party and to carry on
the transactions contemplated by those documents; and
(ii) to carry on the business of the Trust and to own
Assets of the Trust,
in its capacity as trustee of the Trust. There is no
restriction on or condition of its doing so.
(k) (Trust authorisations) All necessary resolutions have been
duly passed and all consents, approvals and other procedural
matters have been obtained or attended to as required by the
Master Trust Deed for it to enter into and perform the Trust
Documents to which it is expressed to be a party.
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(l) (Sole trustee) It has been validly appointed as trustee of the
Trust and is the sole trustee of the Trust.
(m) (Removal) No notice has been given to it, and so far as it is
aware no resolution has been passed or direction or notice has
been given removing it as trustee of the Trust.
(n) (No resettlement) Other than as permitted by the Trust
Documents, it has not taken any action that will cause the
property of the Trust to be re-settled, set aside or
transferred to any other trust.
(o) (No termination) It has not taken any action that will cause
the Trust to be terminated, nor has it taken any action that
will result in the vesting of the Assets of the Trust.
(p) (Right of indemnity) It has not taken any action which will
limit its right of indemnity out of, and lien over, the Assets
of the Trust.
(q) (Compliance with Master Trust Deed) It has complied with its
obligations and duties under the Master Trust Deed, the Series
Notice and (to the best of its knowledge and belief) at law.
No one has alleged that it has not so complied.
11.2 Reliance on representations and warranties
The Trustee acknowledges that the Redraw Facility Provider has entered
the Trust Documents in reliance on the representations and warranties
in this clause.
12. UNDERTAKINGS
12.1 General undertakings
Each of the Trustee and the Trust Manager undertake to the Redraw
Facility Provider as follows in relation to the Trust, except to the
extent that the Redraw Facility Provider consents.
(a) (Authorisations) It will ensure that each Authorisation
required for:
(i) the execution, delivery and performance by it of the
Trust Documents to which it is expressed to be a
party and the transactions contemplated by those
documents;
(ii) the validity and enforceability of those documents;
and
(iii) the carrying on by it of its business as now
conducted or contemplated, is obtained and promptly
renewed and maintained in full force and effect. It
will pay all applicable fees for them. It will
provide copies promptly to the Redraw Facility
Provider when they are obtained or renewed.
(b) (Negative pledge) It will not create or allow to exist a
Security Interest over the Assets of the Trust other than:
(i) under the Trust Documents; or
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(ii) a lien arising by operation of law in the ordinary
course of day-to-day trading and not securing
indebtedness in respect of financial accommodation
where it duly pays the indebtedness secured by that
lien other than indebtedness contested in good faith.
(c) (Comply with obligations) It will duly and punctually comply
with its obligations under the Trust Documents.
(d) (Notice to Redraw Facility Provider) It will notify the Redraw
Facility Provider as soon as it becomes aware of:
(i) any Event of Default; and
(ii) any proposal by a Government Agency to acquire
compulsorily any Assets of the Trust.
12.2 Undertakings relating to Trust
The Trustee, as trustee of the Trust, undertakes to the Redraw Facility
Provider as follows, except to the extent that the Redraw Facility
Provider consents.
(a) (Amendment to Master Trust Deed) It will not consent to any
amendment to the Master Trust Deed, the Series Notice or any
other Trust Document would change:
(i) the basis upon which the amount of any Redraw Advance
to be made is calculated;
(ii) the entitlement of the Trustee to request any Redraw
Advance; or
(iii) the basis of calculation or order of application of
any amount to be paid or applied under clause 6 of
the Series Notice.
(b) (Resettlement) It will not take any action that will be result
in a resettlement, setting aside or transfer of any asset of
the Trust other than a transfer which complies with the Master
Trust Deed, the Series Notice and the other Trust Documents.
(c) (No additional trustee) It will act continuously as trustee of
the Trust in accordance with the Master Trust Deed until the
Trust has been terminated or until it has retired or been
removed in accordance with the Master Trust Deed.
12.3 Term of undertakings
Each undertaking in this clause continues from the date of this
agreement until all moneys actually or contingently owing under this
agreement are fully and finally repaid.
13. EVENTS OF DEFAULT
13.1 Events of Default
Each of the following is an Event of Default (whether or not it is in
the control of the Trustee).
(a) (Payments) An amount is available for payment under clause 6
and the Trustee does not pay that amount within 10 Business
Days of its due date.
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(b) (Insolvency Event) An Insolvency Event occurs:
(i) in relation to the Trust (as if it was a relevant
corporation for the purposes of the definition of
Insolvency Event); or
(ii) in relation to the Trustee, and a successor trustee
of the Trust is not appointed with 30 days of that
Insolvency Event.
(c) (Termination Date) The Termination Date occurs in relation to
the Trust.
(d) (Enforcement of Security Trust Deed) An Event of Default (as
defined in the Security Trust Deed) occurs and any action is
taken to enforce the Security Interest under the Security
Trust Deed over the Assets of the Trust (including appointing
a receiver or receiver and manager or selling any of those
Assets).
13.2 Consequences
In addition to any other rights provided by law or any Trust Document,
at any time after an Event of Default (whether or not it is continuing)
the Redraw Facility Provider may do all or any of the following:
(a) by notice to the Trustee and the Trust Manager declare all
moneys actually or contingently owing under this agreement
immediately due and payable, and the Trustee will immediately
pay the Principal Outstanding together with accrued interest
and fees and all such other moneys; and
(b) by notice to the Trustee and the Trust Manager cancel the
Redraw Limit with effect from any date specified in that
notice.
14. CONTROL ACCOUNTS
The accounts kept by the Redraw Facility Provider constitute sufficient
evidence, unless proven wrong, of the amount at any time due from the
Trustee under this agreement.
15. WAIVERS, REMEDIES CUMULATIVE
(a) No failure to exercise and no delay in exercising any right,
power or remedy under this agreement operates as a waiver. Nor
does any single or partial exercise of any right, power or
remedy preclude any other or further exercise of that or any
other right, power or remedy.
(b) The rights, powers and remedies provided to the Redraw
Facility Provider in this agreement are in addition to, and do
not exclude or limit, any right, power or remedy provided by
law.
16. SEVERABILITY OF PROVISIONS
Any provision of this agreement which is prohibited or unenforceable in
any jurisdiction is ineffective as to that jurisdiction to the extent
of the prohibition or unenforceability. That does not invalidate the
remaining provisions of this agreement nor affect the validity or
enforceability of that provision in any other jurisdiction.
17. SURVIVAL OF REPRESENTATIONS
All representations and warranties in this agreement survive the
execution and delivery of this agreement and the provision of advances
and accommodation.
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18. INDEMNITY AND REIMBURSEMENT OBLIGATION
Unless stated otherwise, each indemnity, reimbursement or similar
obligation in this agreement:
(a) is a continuing obligation;
(b) is a separate and independent obligation;
(c) is payable on demand; and
(d) survives termination or discharge of this agreement.
19. MORATORIUM LEGISLATION
To the full extent permitted by law all legislation which at any time
directly or indirectly:
(a) lessens, varies or affects in favour of the Trustee any
obligation under a Trust Document; or
(b) delays, prevents or prejudicially affects the exercise by the
Redraw Facility Provider of any right, power or remedy
conferred by this agreement, is excluded from this agreement.
20. CONSENTS AND OPINIONS
Except where expressly stated the Redraw Facility Provider may give or
withhold, or give conditionally, approvals and consents, may be
satisfied or unsatisfied, may form opinions, and may exercise its
rights, powers and remedies, at its absolute discretion.
21. ASSIGNMENTS
Neither party may assign or transfer any of its rights or obligations
under this agreement without the prior written consent of the other
party, or if the rating of the Notes would be withdrawn or reduced as a
result of the assignment.
22. NOTICES
All notices, requests, demands, consents, approvals, agreements or
other communications to or by a party to this agreement:
(a) must be in writing;
(b) must be signed by an Authorised Signatory of the sender; and
(c) will be taken to be duly given or made:
(i) (in the case of delivery in person or by post) when
delivered, received or left at the address of the
recipient shown in this agreement or to any other
address which it may have notified the sender;
(ii) (in the case of facsimile transmission) on receipt of
a transmission report confirming successful
transmission; and
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(iii) (in the case of a telex) on receipt by the sender of
the answerback code of the recipient at the end of
transmission,
but if delivery or receipt is on a day on which business is
not generally carried on in the place to which the
communication is sent or is later than 4.00 pm (local time),
it will be taken to have been duly given or made at the
commencement of business on the next day on which business is
generally carried on in that place.
23. AUTHORISED SIGNATORIES
The Trustee irrevocably authorises the Redraw Facility Provider to rely
on a certificate by persons purporting to be its directors and/or
secretaries as to the identity and signatures of its Authorised
Signatories. The Trustee warrants that those persons have been
authorised to give notices and communications under or in connection
with this agreement.
24. GOVERNING LAW AND JURISDICTION
This agreement is governed by the laws of [New South Wales]. The
Trustee submits to the non-exclusive jurisdiction of courts
exercising jurisdiction there.
25. COUNTERPARTS
This agreement may be executed in any number of counterparts. All
counterparts together will be taken to constitute one instrument.
26. ACKNOWLEDGEMENT BY TRUSTEE
The Trustee confirms that:
(a) it has not entered into this agreement in reliance on, or as a
result of, any statement or conduct of any kind of or on
behalf of the Redraw Facility Provider (including any advice,
warranty, representation or undertaking); and
(b) the Redraw Facility Provider is not obliged to do anything
(including disclose anything or give advice),
except as expressly set out in this agreement.
27. LIMITED RECOURSE
27.1 General
Clause 33 of the Master Trust Deed applies to the obligations and
liabilities of the Trustee and the Trust Manager under this agreement.
27.2 Liability of Trustee limited to its right to indemnity
(a) This agreement applies to the Trustee only in its capacity as
trustee of the Trust and in no other capacity. A liability
arising under or in connection with this agreement or the
Trust can be enforced against the Trustee only to the extent
to which it can be satisfied out of property of the Trust out
of which the Trustee is actually indemnified for the
liability. This limitation of the Trustee's liability applies
despite any other provision of this agreement and extends to
all liabilities and obligations of the Trustee in any way
connected with any representation, warranty, conduct,
omission, agreement or transaction related to this agreement
or the Trust.
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(b) The parties other than the Trustee may not sue the Trustee in
any capacity other than as trustee of the Trust or seek the
appointment of a receiver (except under the Security Trust
Deed), or a liquidator, an administrator or any similar person
to the Trustee or prove in any liquidation, administration or
arrangements of or affecting the Trustee.
(c) The provisions of this clause 3 shall not apply to any
obligation or liability of the Trustee to the extent that it
is not satisfied because under a Transaction Document or by
operation of law there is a reduction in the extent of the
Trustee's indemnification out of the Assets of the Trust as a
result of the Trustee's fraud, negligence or breach of trust.
(d) It is acknowledged that the Trust Manager, the Servicer, the
Note Trustee, the Principal Paying Agent, the other Paying
Agents and the Agent Bank (each a Relevant Party) are
responsible under this agreement and the other Transaction
Documents for performing a variety of obligations relating to
the Trust. No act or omission of the Trustee (including any
related failure to satisfy its obligations under this
agreement) will be considered fraud, negligence or breach of
trust of the Trustee for the purpose of sub-paragraph (c) to
the extent to which the act or omission was caused or
contributed to by any failure by any Relevant Party or any
other person who provides services in respect of the Trust
(other than a person who has been delegated or appointed by
the Trustee and for whom the Trustee is responsible under this
agreement or the relevant Transaction Documents, but excluding
any Relevant Party) to fulfil its obligations relating to the
Trust or by any other act or omission of a Relevant Party or
any other person who provides services in respect of the Trust
(other than a person who has been delegated or appointed by
the Trustee and for whom the Trustee is responsible under this
agreement or the relevant Transaction Documents, but excluding
any Relevant Party).
(e) No attorney, agent, receiver or receiver and manager appointed
in accordance with this agreement or any other Transaction
Documents (including a Relevant Party) has authority to act on
behalf of the Trustee in a way which exposes the Trustee to
any personal liability and no act or omission of any such
person will be considered fraud, negligence or breach of trust
of the Trustee for the purpose of sub-paragraph (c), if the
Trustee has exercised reasonable care in the selection and
supervision of such a person.
27.3 Unrestricted remedies
Nothing in clause 27.2 limits the Redraw Facility Provider in:
(a) obtaining an injunction or other order to restrain any breach
of this agreement by any party;
(b) obtaining declaratory relief; or
(c) in relation to its rights under the Security Trust Deed.
27.4 Restricted remedies
Except as provided in clause 27.3, the Redraw Facility Provider shall
not:
(a) (judgment) obtain a judgment for the payment of money or
damages by the Trustee;
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(b) (statutory demand) issue any demand under s459E(1) of the
Corporations Law (or any analogous provision under any other
law) against the Trustee;
(c) (winding up) apply for the winding up or dissolution of the
Trustee;
(d) (execution) levy or enforce any distress or other execution
to, on, or against any assets of the Trustee;
(e) (court appointed receiver) apply for the appointment by a
court of a receiver to any of the assets of the Trustee;
(f) (set-off or counterclaim) exercise or seek to exercise any
set-off or counterclaim against the Trustee; or
(g) (administrator) appoint, or agree to the appointment, of any
administrator to the Trustee,
or take proceedings for any of the above and the Redraw Facility
Provider waives its rights to make those applications and take those
proceedings.
28. REDRAW FACILITY PROVIDER'S OBLIGATIONS
The Trustee shall have no recourse to the Redraw Facility Provider in
relation to this agreement beyond its terms, and the Redraw Facility
Provider's obligations under this agreement are separate from, and
independent to, any obligations the Redraw Facility Provider may have
to the Trustee for any other reason (including under any other Trust
Document).
29. SUCCESSOR TRUSTEE
The Redraw Facility Provider shall do all things reasonably necessary
to enable any successor Trustee appointed under clause 24 of the Master
Trust Deed to become the Trustee under this agreement.
EXECUTED in Sydney.
Each attorney executing this agreement states that he has no notice of
revocation or suspension of his power of attorney.
SIGNED on behalf of )
WESTPAC SECURITIES )
ADMINISTRATION LIMITED )
by its attorney )
in the presence of: ) -----------------------------
Signature
- ----------------------------- -----------------------------
Witness Print name
- -----------------------------
Print name
<PAGE>
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- --------------------------------------------------------------------------------
SIGNED on behalf of )
WESTPAC BANKING CORPORATION )
by its attorney in the )
presence of: ) ----------------------------
Signature
- ------------------------------ ----------------------------
Witness Print name
- -----------------------------
Print name
SIGNED on behalf of )
WESTPAC SECURITISATION )
MANAGEMENT PTY LIMITED by its )
attorney in the presence of: ) --------------------------
Signature
- ----------------------------- --------------------------
Witness Print name
- -----------------------------
Print name
<PAGE>
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- --------------------------------------------------------------------------------
ANNEXURE A
DRAWDOWN NOTICE
To: Westpac Banking Corporation
REDRAW FACILITY AGREEMENT - DRAWDOWN NOTICE NO. [*]
We refer to the Redraw Facility Agreement dated 1998 (the Facility Agreement).
Under clause 3.1 of the Redraw Facility Agreement we give you irrevocable notice
as follows:
(1) we wish to draw on [*] (the Drawdown Date); [NOTE: Date is to be a
Business Day.]
(2) the principal amount of the Redraw Advance is $[*]; [NOTE: Amount to
comply with the limits in clause 3.]
(3) we request that the proceeds be remitted to account number [*] at [*];
[NOTE: The account(s) to be completed only if funds not required in
repayment of any previous Redraw Advance(s).]
(4) we represent and warrant that no Event of Default [under the Facility
Agreement, and no Event of Default as defined in the Security Trust
Deed], subsists or will result from the drawing; and
(5) all representations and warranties under clause 11 of the Facility
Agreement are true as though they had been made at the date of this
Drawdown Notice and the Drawdown Date specified above in respect of the
facts and circumstances then subsisting.
Definitions in the Facility Agreement apply in this Drawdown Notice.
WESTPAC SECURITIES ADMINISTRATION LIMITED as trustee of the Series 1997-4E WST
Trust
By: [Authorised Signatory]
DATED
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ANNEXURE B
VERIFICATION CERTIFICATE
To: Westpac Banking Corporation
REDRAW FACILITY AGREEMENT
I [*] am a [director] of Westpac Securities Administration Limited of [*] (the
Company).
I refer to the Redraw Facility Agreement (the Facility Agreement) dated
_______ 1998 between the Company as Trustee, Westpac Banking Corporation and
Westpac Securitisation Management Pty Limited.
Definitions in the Facility Agreement apply in this Certificate.
I CERTIFY as follows.
1. Attached to this Certificate are complete and up to date copies of:
(a) unless paragraph 2 below applies, the memorandum and articles
of association of the Company (marked A); and
(b) a power of attorney granted by the Company for the execution
of the Facility Agreement to which it is expressed to be a
party (marked B). That power of attorney has not been revoked
or suspended by the Company and remains in full force and
effect.
2. If the memorandum and articles of association of the Company are not
attached to this certificate, there has been no change to them since
the Company last gave a certified copy of them to Westpac Banking
Corporation.
3. The following are signatures of the Authorised Signatories of the
Company and the persons who have been authorised to sign the Facility
Agreement and to give notices and communications under or in connection
with the Facility Agreement. If no signatures are set out below, the
Authorised Signatories with respect to the Facility Agreement are the
same as in relation to the Series 1997-3E WST Trust, a copy of those
signatures having previously been provided to Westpac Banking
Corporation.
Authorised Signatories
Name Position Signature
* * -----------------------
* * -----------------------
* * -----------------------
<PAGE>
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- --------------------------------------------------------------------------------
Signatories
Name Position Signature
* * -----------------------
* * -----------------------
* * -----------------------
Signed:
-----------------------
Director
-----------------------
Print name
DATED
