<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 26, 1998
REGISTRATION NO. 333-46945
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
PRE-EFFECTIVE AMENDMENT NO. 3 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
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<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 26, 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.
Under certain limited circumstances, the Issuer Trustee may issue certain
additional securities, the RFSs, which in certain circumstances will convert to
RFS Class A Notes. The RFSs will be senior in priority of distributions of
principal to the Class A Notes and the RFS Class A Notes (except with respect to
enforcement, in which case such classes will be PARI PASSU) and senior in
priority of distributions of principal and interest to the Class B 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 and senior in priority of
distributions of principal and interest to the Class B Notes. The RFSs and RFS
Class A Notes are not offered hereby. See "SUMMARY OF TERMS--Redraws, RFSs and
RFS Class A Notes."
(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(1)
<S> <C> <C> <C>
Class A Notes...................................... % % %
Class B Notes...................................... % % %
Total.............................................. US$ US$ US$
</TABLE>
(1) 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 (which includes 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 and
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 June 9, 1998
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
DEUTSCHE MORGAN GRENFELL
MERRILL LYNCH & CO.
SBC WARBURG DILLON READ
The date of this Prospectus is May , 1998.
<PAGE>
(CONTINUED FROM THE COVER PAGE)
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 and certain of the Swap Agreements) 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.
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
, 1998 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; Priority of Payment of Principal to
RFSs." The RFSs and the RFS Class A Notes are not being offered hereby.
The Offered Notes may not, in connection with their initial distribution, be
offered or sold, directly or indirectly, in the Commonwealth of Australia, its
territories or possessions or to any resident of Australia.
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).
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
2
<PAGE>
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.
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 Global 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.
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 June 1999.
3
<PAGE>
DISCLAIMERS WITH RESPECT TO SALES TO NON-U.S. INVESTORS
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, see "UNDERWRITING."
The Issuer Trustee accepts responsibility for the information contained in
this Prospectus (which includes 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 (which
includes the Appendices) 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 Swaps". 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
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 information described above) or any other
information supplied in connection with the Offered Notes or their distribution.
None of the Seller Trustee, the Servicer, Trust Manager, Westpac, the
Security Trustee, the Note Trustee, any Mortgage Insurer 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, any Mortgage
Insurer 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, any Mortgage Insurer 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 authorized to give any information or to make any
representations other than those contained in this Prospectus 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 authorized by the
Issuer
4
<PAGE>
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 material change in the affairs of the Issuer
Trustee or any other party named in the Prospectus since the date hereof or the
date upon which this document has been most recently amended or supplemented or
that there has been no material adverse change in the financial position of the
Issuer Trustee or any other party named in the Prospectus 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
Offered 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 or any other party named in the
Prospectus during the life of the Offered 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, the Note Trustee, the Currency Swap Providers or any of the
Underwriters that any recipient 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,
Trust Manager, the Seller Trustee, Westpac, the Note Trustee, the Security
Trustee, any Mortgage Insurer or any of the Underwriters accept any
responsibility or make any representation as to the tax consequences of
investing in the Offered Notes.
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."
5
<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.
------------------------
6
<PAGE>
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 expressly submits 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 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$.6304=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 May 21, 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.
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TABLE OF CONTENTS
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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 Swaps........................................................................................ 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 Prepayment and Yield Considerations......................................................... 38
No Gross-Up; Tax Redemption........................................................................... 39
Reinvestment Risk..................................................................................... 39
Servicer Risk......................................................................................... 40
Subordination of the Class B Notes.................................................................... 40
Priority of RFSs and RFS Class A Notes Owned by Australian Resident Investors......................... 40
Credit Enhancement Provides Only Limited Protection Against Losses.................................... 41
Limitations on the Liquidity Support.................................................................. 41
Exercise of Clean-up Offer may result in Shortfalls to Noteholders.................................... 41
Redemption of the Notes............................................................................... 41
Geographic Concentration May Affect Performance....................................................... 42
Consumer Credit Legislation........................................................................... 42
Risk of Commingling................................................................................... 43
Limited Liquidity..................................................................................... 43
Ratings of the Notes; Factors Affecting Ability to Maintain Ratings................................... 43
Book-Entry Notes...................................................................................... 44
Other Considerations.................................................................................. 44
FORMATION OF THE TRUST.................................................................................... 44
Westpac Securitisation Trust Programme................................................................ 44
Series 1998-1G WST Trust.............................................................................. 44
Trust Assets.......................................................................................... 45
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SECURITY FOR THE NOTES.................................................................................... 45
Charge................................................................................................ 45
Security Trustee...................................................................................... 46
Nature of Security.................................................................................... 46
Enforcement........................................................................................... 47
Priorities under the Security Trust Deed.............................................................. 48
Security Trustee's Fees and Expenses.................................................................. 49
Retirement and Removal................................................................................ 49
Additional Provisions of the Security Trust Deed...................................................... 50
THE TRUST FUND............................................................................................ 51
General............................................................................................... 51
Transfer and Assignment of Housing Loans.............................................................. 51
Representations and Warranties........................................................................ 52
Breach of Representations and Warranties.............................................................. 53
Housing Loan Statistics............................................................................... 54
THE ISSUER TRUSTEE........................................................................................ 60
Incorporation......................................................................................... 60
Share Capital......................................................................................... 60
Business.............................................................................................. 61
Experience............................................................................................ 61
Directors............................................................................................. 61
Powers................................................................................................ 61
Duties................................................................................................ 62
Delegation............................................................................................ 63
Issuer Trustee Fees and Expenses...................................................................... 63
Removal of the Issuer Trustee......................................................................... 63
Voluntary Retirement of the Issuer Trustee............................................................ 64
Limitation of Issuer Trustee's Liability.............................................................. 64
Rights of Indemnity of Issuer Trustee................................................................. 64
Limitation of Seller Trustee's Liability and Rights of Indemnity...................................... 65
Rights of Indemnity of Seller Trustee................................................................. 65
THE NOTE TRUSTEE.......................................................................................... 65
ORIGINATOR OF THE HOUSING LOANS........................................................................... 66
Year 2000............................................................................................. 66
THE SERVICER.............................................................................................. 66
General............................................................................................... 66
Servicing of Housing Loans............................................................................ 66
Document Custody...................................................................................... 67
Collection and Enforcement Procedures................................................................. 67
Delinquencies and Mortgagee in Possession with respect to the Securitized Portfolios.................. 68
THE TRUST MANAGER......................................................................................... 70
General............................................................................................... 70
Incorporation......................................................................................... 70
Share Capital......................................................................................... 70
Directors............................................................................................. 70
Duties and Role of the Trust Manager.................................................................. 71
Removal of the Trust Manager.......................................................................... 71
Voluntary Retirement of the Trust Manager............................................................. 72
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Limitation of Trust Manager's Liability............................................................... 72
WESTPAC RESIDENTIAL LOAN PROGRAM.......................................................................... 73
Origination of Housing Loans.......................................................................... 73
Underwriting of Housing Loans......................................................................... 73
Servicing of Housing Loans............................................................................ 74
Housing Loan Products................................................................................. 74
Housing Loan Features................................................................................. 75
THE MORTGAGE INSURANCE POLICIES........................................................................... 77
Mortgage Insurance Policies--General.................................................................. 77
The HLIC Mortgage Pool Insurance Policy............................................................... 78
Primary Mortgage Insurance Policies................................................................... 82
PREPAYMENT AND YIELD CONSIDERATIONS....................................................................... 84
General............................................................................................... 84
Prepayments........................................................................................... 84
Weighted Average Lives................................................................................ 84
DESCRIPTION OF THE OFFERED NOTES.......................................................................... 88
General............................................................................................... 88
Collections and Payment............................................................................... 89
Collections........................................................................................... 89
Calculation of Total Available Funds.................................................................. 90
Available Income...................................................................................... 90
Principal Draws....................................................................................... 92
Liquidity Draws....................................................................................... 92
Remaining Liquidity Shortfall......................................................................... 92
Distribution of Total Available Funds................................................................. 93
Excess Available Income............................................................................... 95
Gross Principal Collections........................................................................... 96
Principal Collections................................................................................. 97
Distribution of Principal Collections................................................................. 97
Payments of Principal on the Notes.................................................................... 98
Application of Principal Charge Offs.................................................................. 101
Payments into US$ Account............................................................................. 102
Payments out of US$ Account........................................................................... 103
Prepayment Costs and Prepayment Benefits.............................................................. 103
Description of the Redraw Facility, the Redraw Funding Securities and the RFS Class A Notes........... 103
Redraw Facility....................................................................................... 103
Issuance of Redraw Funding Securities ("RFS")......................................................... 107
RFS Class A Notes..................................................................................... 107
Form of the RFSs and the RFS Class A Notes............................................................ 107
Interest Payable on the RFSs and the RFS Class A Notes................................................ 108
Subordination of Class B Notes; Priority of Principal Payments to RFSs................................ 108
Substitution of Housing Loans......................................................................... 108
Prescription.......................................................................................... 108
Clean-up Offer........................................................................................ 109
Redemption of the Notes............................................................................... 109
Withholding or Tax Deductions......................................................................... 109
Redemption of the Offered Notes for Taxation or Other Reasons......................................... 110
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Termination of the Trust.............................................................................. 110
Trust Accounts........................................................................................ 111
General............................................................................................... 112
Determination Date--Calculations and Reports to Noteholders........................................... 112
Book-Entry Registration............................................................................... 113
Definitive Notes...................................................................................... 116
Modification of Master Trust Deed, Series Notice and the Note Trust Deed Without Noteholder Consent... 117
Modification of Master Trust Deed, Series Notice and the Note Trust Deed With Noteholder Consent...... 117
Meetings of Voting Mortgagees......................................................................... 118
Voting of Class A Noteholders; Modification; Consents; Waiver......................................... 118
Voting of Class B Noteholders; Modifications; Consents; Waiver........................................ 119
Events of Default; Rights Upon Event of Default....................................................... 119
Enforcement of the Security Trust Deed................................................................ 120
Certain Covenants..................................................................................... 123
Annual Compliance Statement........................................................................... 124
The Note Trustee...................................................................................... 124
Governing Law......................................................................................... 124
London Stock Exchange Listing......................................................................... 124
DESCRIPTION OF THE SERVICING AGREEMENT.................................................................... 124
General............................................................................................... 124
Servicing............................................................................................. 125
Document Custody...................................................................................... 128
Amendment............................................................................................. 129
Termination of Servicing Agreement.................................................................... 129
THE LIQUIDITY FACILITY.................................................................................... 130
General Description................................................................................... 130
Liquidity Draws....................................................................................... 130
Conditions Precedent to a Liquidity Draw.............................................................. 130
Deposit into a Collateral Account..................................................................... 130
Interest on Liquidity Draws........................................................................... 131
Commitment Fee........................................................................................ 131
Repayment of Liquidity Drawings....................................................................... 131
Events of Default..................................................................................... 132
Consequences of Default............................................................................... 132
Termination........................................................................................... 132
DESCRIPTION OF THE SWAP AGREEMENTS........................................................................ 133
Description of Interest Rate Swap Agreements.......................................................... 133
Description of Currency Swaps......................................................................... 135
Replacement of Currency Swaps......................................................................... 137
Downgrade of Currency Swap Providers.................................................................. 137
Cross Support......................................................................................... 137
CURRENCY SWAP PROVIDERS................................................................................... 137
CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS................................................................ 138
General............................................................................................... 138
Nature of Housing Loans as Security................................................................... 139
Enforcement of Housing Loans.......................................................................... 141
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Penalties and Prohibited Fees......................................................................... 141
Consumer Credit Legislation........................................................................... 142
Bankruptcy............................................................................................ 142
Environmental......................................................................................... 143
Insolvency Considerations............................................................................. 143
Treatment of Interest Payments with respect to Australian Housing Loans............................... 143
USE OF PROCEEDS........................................................................................... 144
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES............................................................. 144
General............................................................................................... 144
Sales of Notes........................................................................................ 144
Market Discount....................................................................................... 145
Premium............................................................................................... 145
Backup Withholding.................................................................................... 146
CERTAIN AUSTRALIAN TAX MATTERS............................................................................ 146
Payments of Principal, Premiums and Interest.......................................................... 146
Profit on Sale........................................................................................ 147
Other Taxes........................................................................................... 148
ERISA CONSIDERATIONS...................................................................................... 148
RATINGS OF THE NOTES...................................................................................... 149
LEGAL INVESTMENT CONSIDERATIONS........................................................................... 149
UNDERWRITING.............................................................................................. 149
United Kingdom........................................................................................ 150
Australia............................................................................................. 150
LISTING AND GENERAL INFORMATION........................................................................... 151
Listing............................................................................................... 151
Authorization......................................................................................... 151
Litigation............................................................................................ 151
Euroclear and Cedel................................................................................... 151
Documents Available for Collection and Inspection..................................................... 151
Temporary Australian Foreign Exchange Controls........................................................ 152
Consents to Opinions.................................................................................. 152
LEGAL MATTERS............................................................................................. 153
INDEX OF DEFINED TERMS.................................................................................... 154
APPENDIX I--GLOSSARY OF AUSTRALIAN LEGAL TERMS............................................................ I-1
APPENDIX II--TERMS AND CONDITIONS OF THE CLASS A NOTES.................................................... II-1
APPENDIX III--TERMS AND CONDITIONS OF THE CLASS B NOTES................................................... III-1
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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 in the "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 direct 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), between 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, London Branch
(the "Note Trustee"), 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"). Morgan
Guaranty Trust Company of New York is a wholly owned
subsidiary of J.P. Morgan & Co. Incorporated. 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. Upon the completion of such acquisition, Citibank,
N.A. will act as Note Trustee. See "THE NOTE TRUSTEE."
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
Trust Assets (as defined herein) 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 interests of the Offered 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 with
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 typical United States
transaction.
Securities Offered.............. The Issuer Trustee, in its capacity as trustee of the
Series 1998-1G WST Trust, which was formed under the laws
of the Australian Capital Territory, will issue and hereby
offer the following Mortgage Backed Floating Rate Notes:
Class A Mortgage Backed Floating Rate Notes due July 19,
2029 in the aggregate principal amount of US$ (the
"Class A Notes").
Class B Mortgage Backed Floating Rate Notes due July 19,
2029 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. Such amounts drawn by Borrowers
on principal repayments made in excess of scheduled
payments are called "redraws". Westpac is entitled to be
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reimbursed by the Issuer Trustee for such redraws from
Gross Principal Collections (as defined herein) prior to
any payments being made on 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
Agreement 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 Agreement will rank PARI PASSU in respect of
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.................... May 6, 1998 (the "Cut-Off Date").
Closing Date.................... June 9, 1998 (the "Closing Date").
Maturity Date................... July 19, 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 (a) 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; (b) in relation to US$ payments
under a Currency Swap any day, other than a Saturday,
Sunday or public holiday, on which banks are open for
business in London and New York City; and (c) in relation
to A$ payments under the Currency Swap and 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.
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"), Morgan
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Guaranty Trust Company of New York, London Branch (the
"Agent Bank") will determine the rate "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.
With respect to any Payment Date, interest on a Class of
Offered 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
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herein), Trust Expenses (as defined herein) and certain
amounts payable to any Interest Rate 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 (the "Redraw Facility Provider"), to repay
any Principal Outstanding (as defined herein) under the
Redraw Facility Agreement;
(iii) to fund any Principal Draw (as defined herein) 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$55,000,000. HLIC is a
private insurance company which is a subsidiary of GE
Capital Australia (ACN 008 562 534).
For a description of HLIC, see "THE MORTGAGE INSURANCE
POLICIES--The HLIC Mortgage Pool Insurance Policy."
Each Housing Loan with an LVR of greater than 80% at the
time of origination (or a lower LVR where required by
Westpac's
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standard credit policy) will have been insured under a PMI
Policy issued by one of the following: Royal & Sun
Alliance Lenders Mortgage Insurance Limited (ACN 001 825
725) of Level 9, 465 Victoria Avenue, Chatswood NSW
("Royal & Sun"), MGICA Limited (ACN 000 511 071) 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 35.70% 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, Royal & Sun, 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 losses on the Housing Loans.
See "DESCRIPTION OF THE OFFERED NOTES--Collections and
Payment" herein.
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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." The Offered Notes are issued with the benefit
of, and subject to the terms of, 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 15,085 Housing Loans
with an aggregate Balance Outstanding on the Cut-Off Date
of A$1,600,862,455. 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.
Generally each Housing Loan is secured by a registered
first ranking mortgage over the related Mortgaged Property
or if the Housing Loan is not secured by a first ranking
mortgage the Approved Seller will assign to the Issuer
Trustee all prior ranking registered mortgages in relation
to that Housing Loan. "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 the 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. If Scheduled Payments are not received with
respect to certain Housing Loans on the related due date
either a default rate of interest may be charged on any
overdue amounts or there will be a compounding of
interest.
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.
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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 approximately 5.69% per annum to 10.15%
per annum. The weighted average Mortgage Rate of the
Housing Loans on the Cut-Off Date is approximately 6.55%
per annum. The Cut-Off Date Balances Outstanding of the
Housing Loans ranged from approximately A$10,027 to
A$700,000. The average Cut-Off Date Balance Outstanding of
the Housing Loans is approximately A$106,123. The weighted
average original term to stated maturity of the Housing
Loans is approximately 296.74 months. The weighted average
remaining term to stated maturity of the Housing Loans is
approximately 287.97 months. As of the Cut-Off Date, the
weighted average number of months that had elapsed since
origination of the Housing Loans is approximately 8.77
months.
Housing Loans representing approximately 17.97% 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 1.99% and 94.96%. 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. The Mortgaged
Property is generally valued at the time of origination.
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
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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 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 by an amount equal to the amount of any 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
temporarily funding certain income shortfalls in the
Trust, up to an aggregate amount being the lesser of: (1)
A$56,000,000, (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."
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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
Offered Noteholders, the Note Trustee, the Trust Manager,
the Swap Providers (as defined herein), the Security
Trustee, each Paying Agent, each provider of a Support
Facility (other than the provider of a Mortgage Insurance
Policy), to the Approved Sellers in respect of any Accrued
Interest Adjustment, to Westpac in respect of Redraws, 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 proprietary 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, provided such dealings and
transfers of title are in the ordinary course of the
chargor's business. 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"
are constituted by three 1991 ISDA Master Agreements (each
an "ISDA Master Agreement"), the schedules supplementing
such agreements and written swap confirmations confirming
the Variable Rate Basis Swap, two Fixed Rate Basis Swaps
and the Currency Swaps. See "DESCRIPTION OF THE SWAP
AGREEMENTS."
AGENCY AGREEMENT: Pursuant to the Agency Agreement, the
Issuer Trustee will appoint paying agents and an agent
bank with respect to the Offered Notes. The terms and
conditions of these appointments are set forth in the
Agency Agreement.
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LIQUIDITY FACILITY AGREEMENT: Under the Liquidity Facility
Agreement, the Liquidity Facility Provider agrees to make
advances to the Issuer Trustee for the purpose of
providing liquidity to cover 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 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........ Persons acquiring beneficial ownership interests in the
Offered Notes will hold their Offered 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 (as defined herein) 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
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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,
collected, withheld or assessed by the Commonwealth of
Australia or any of its political subdivisions or any of
its authorities (a "Withholding Tax Event") 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 by reason 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 subdivisions or any of
its authorities, the Issuer Trustee must, when so directed
by the Trust Manager (at any time 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) upon 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 holders of 75% of the aggregate Invested Amount of
such Class, at their Stated Amount), together with accrued
interest to the date of redemption on any subsequent
Payment Date, provided that the the holders of 75% of the
aggregate Invested Amount of such Class may 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. All
amounts ranking prior to or PARI PASSU with respect to a
Class of Notes must be redeemed concurrently with such
Class. Thus the Class B Notes may not be redeemed unless
the Class A Notes are also redeemed. See "RISK FACTORS--No
Gross-Up; Tax Redemption."
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
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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. Each Offered Noteholder, by acceptance of an
Offered Note, will agree to treat the Offered Notes as
indebtedness. See "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
Offered Noteholders in respect of such withholding tax.
See "RISK FACTORS--No Gross-Up; Tax Redemption."
ERISA Considerations............ Subject to the considerations discussed under "ERISA
CONSIDERATIONS," the Offered Notes are eligible for
purchase by employee benefit plans.
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 and certain of the Swap Agreements)
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
28
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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 "Serial 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 interest 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
Principal Outstanding under the Redraw Facility.
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 Swaps 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$56,000,000) to provide liquidity to allow Total Payments to be made.
CURRENCY SWAPS
All payments required to be made to Offered 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 36.37% 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 their
Scheduled Payments and accordingly, may become delinquent or may default on
their respective
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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 to investment property status or vice
versa (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 "PREPAYMENT 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 Swaps, 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 Swaps. The Offered 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
Swaps, 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 Issuer Trustee 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
payments on the Offered Notes and the Housing Loans.
(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
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Housing Loans, which will be in Australian dollars. If the Currency Swap
Providers were to fail to perform under the Currency Swaps or were to be
discharged from such performance because of a default thereunder by the Trust,
the Issuer Trustee 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 1.600861 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 Issuer Trustee the
three month Bank Bill Rate plus a fixed margin and receive from the Issuer
Trustee the weighted average variable housing rate. The margin is fixed for the
life of the swap and will be set with regard for the ongoing expenses of the
Trust.
If Westpac is downgraded below A-1+/A2/F-1+ by Standard & Poor's, Moody's or
Fitch, respectively, 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 across Westpac's whole portfolio of loans of the same product type 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 Offered Noteholders to experience
higher rates of principal repayment on the Offered Notes than anticipated. If
the Variable Rate Basis Swap is terminated, the Trust may be subject to
reinvestment risk to the extent that any payments and prepayments invested in
Authorized Investments do not earn a sufficient rate of interest to cover the
interest owing on the Notes.
(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 on the Closing Date to hedge that portion of the pool earning a
Fixed Rate of interest as of the 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 A-1+/A2/F-1+ by Standard & Poor's, Moody's or
Fitch, respectively, 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, who shall make such decision 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
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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). If the relevant
Fixed Rate Basis Swap is terminated, the Trust will be subject to the risk that
the floating rate obligations of the Trust may change in such a way that the
discretionary fixed rate set by Westpac on those Housing Loans being charged a
fixed rate of interst will be insufficient to make payments on such floating
rate obligations.
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
Although little data is available and no empirical verification has been
made by the Trust Manager, 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 PREPAYMENT AND YIELD CONSIDERATIONS
The yield to maturity experienced by a Offered 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;
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(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");
(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 or a
redemption for taxation or other reasons (see "DESCRIPTION OF THE OFFERED
NOTES--Clean-Up Offer" and "--Redemption of the Offered Notes for Taxation or
Other Reasons");
(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 Offered 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 and homeowner mobility. Furthermore,
unlike the United States, 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. This is one contributing
factor to borrowers prepaying housing loans relating to owner-occupied
properties in Australia in a manner that differs from the United States. See
"CERTAIN LEGAL ASPECTS OF THE HOUSING LOANS-- Treatment of Interest Payments
with respect to Australian Housing Loans".
See "PREPAYMENT AND YIELD CONSIDERATIONS."
NO GROSS-UP; TAX REDEMPTION
In the event that any withholding tax is imposed on payments of interest on
any of the Offered Notes, the holders of the Offered Notes will not be entitled
to receive grossed-up amounts to compensate for such withholding tax.
Consequently, there can be no assurance that the remaining payments on the
Housing Loans would be sufficient to make timely payments of Interest on and
payment of principal at the maturity date of the Offered Notes. In addition,
upon the occurrence of a Withholding Tax Event, the Issuer Trustee (at the
direction of the Trust Manager) may on any Payment Date simultaneously redeem in
whole but not in part, at the redemption prices specified herein, the affected
Class of Offered Notes in accordance with the procedures described under
"DESCRIPTION OF THE OFFERED NOTES--Redemption of the Offered Notes for Taxation
or Other Reasons" herein. Holders of 75% of the Invested Amount of a Class may
also elect not to redeem the affected Class of Offered Notes in the event of a
Withholding Tax Event.
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
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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.
SUBORDINATION OF THE 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 Redraw Facility Agreement and to holders of the Class A Notes and
RFS Class A Notes (if any). Furthermore, any Principal Charge Offs will be
applied first in reduction of the principal balance of the Class B Notes.
In the event that the Note Trustee is required by the Transaction Documents
or the Offered Notes to have regard to the interests of the Class A Noteholders
and the Class B Noteholders and where, in the opinion of the Note Trustee, there
is a conflict between the interests of the Class A Noteholders and the interests
of the Class B Noteholders, the Note Trustee shall have regard only to the
interests of the Class A Noteholders despite anything to the contrary in the
Transaction Documents.
PRIORITY OF RFSS AND RFS CLASS A NOTES OWNED BY AUSTRALIAN RESIDENT INVESTORS
In certain limited circumstances, the Issuer Trustee 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 being made on the Class A Notes.
Additionally, if RFSs 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
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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 on 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 and 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 does not 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. See "DESCRIPTION OF THE
NOTES--Clean-up Offer."
REDEMPTION OF THE NOTES
If an Event of Default occurs under the Security Trust Deed while the
Offered 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 current 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."
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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 holders of 75% of the votes of all 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 46.91%, 17.77% and 16.89% (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 has the 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 either Westpac or, after a
Title Perfection Event, the Issuer Trustee, in relation to any breaches of
the Consumer Credit Legislation in relation to the Housing Loan or the
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
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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 representations 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 a 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 that
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 Collections 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 Offered Noteholders with liquidity of
investment or that it will remain for the term of any Offered 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 and 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,
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 foreign
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 Policies, the availability of the Liquidity
Facility, the creditworthiness of the Interest Rate Swap Provider, the Currency
Swap Providers and the Mortgage Insurers and the foreign
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currency rating of Australia. In the context of an asset securitization, the
foreign 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 Note Owner (as defined herein) 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 Offered Notes, may be
limited due to lack of a physical certificate representing the Offered Notes.
Note Owners 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 Principal Paying Agent 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 any other trust formed under the
Master Trust Deed are not available to meet the liabilities of the Series
1998-1G WST Trust. 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 the Trust, the Trust Manager and the
Issuer Trustee have executed a notice of creation of trust dated (the
"Notice of Creation of Trust").
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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 Offered
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. The Master Trust Deed and a form
of 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 Offered 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
Pursuant to 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 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 Offered Noteholders, the Note Trustee, the Trust
Manager, the Interest Rate Swap Provider, the Currency Swap Providers, the
Security Trustee, each Paying Agent, each other provider of a Support Facility
(other than any provider of a Mortgage Insurance Policy), the Approved Sellers
in respect of any Accrued Interest Adjustment (as defined herein), to Westpac in
respect of Redraws, to the holders of the RFSs (if any) and the holders of the
RFS Class A Notes (if any) (such creditors, together the "Mortgagees").
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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 Trust Assets in trust for each Mortgagee in
accordance with the terms and conditions of the Security Trust Deed.
Subject to the provisions 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), the RFS Class A Notes (if any), 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, 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, 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.
The Security Trustee does not guarantee the success of the Offered Notes nor
the payment of principal or Interest on the Offered Notes.
NATURE OF SECURITY
If a company grants a fixed security over any of its assets, those assets
may not be dealt with by such 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, provided such
dealings and transfers of title are in the ordinary course of a chargor's
business. 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.
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.
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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 (as defined herein) (including amounts
outstanding under the Notes, plus accrued and unpaid interest) 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.
Every question submitted to a meeting shall be decided in the first instance
by a show of hands and in case of equality of votes the chairman shall both on a
show of hands and on a poll have a casting vote in addition to the vote or votes
(if any) to which he may be entitled as Voting Mortgagee or as a Representative
(as defined herein). On a show of hands, every person holding, or being a
Representative holding or representing other persons who hold, Secured Moneys
shall have one vote except that the Note Trustee shall represent each Noteholder
who has directed the Note Trustee to vote on its behalf under the Note Trust
Deed. On a poll, every person who is present shall have one vote for US $10,000
(but not part thereof) of the Secured Moneys that he holds or in which he is a
Representative. A "Representative" is in the case of any Noteholder, a person or
body corporate appointed as a proxy for that Noteholder.
A resolution of all the Voting Mortgagees (including an Extraordinary
Resolution) may be passed, without any meeting or previous notice being
required, by an instrument or notes in writing which have been signed by all of
the Voting Mortgagees.
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.
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The Note Trustee will be the only Voting Mortgagee for so long as the
amounts outstanding under the Offered Notes are 75% or more of all Secured
Moneys.
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 PARI PASSU and rateably:
(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 PARI PASSU and rateably any unpaid Accrued Interest
Adjustment due to an Approved Seller;
(4) fourth, to pay PARI PASSU and rateably:
(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 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 the 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;
48
<PAGE>
(6) sixth, to pay PARI PASSU and rateably any amounts not covered above
owing to any Mortgagee under any Transaction Document;
(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; and
(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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<PAGE>
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 the Note
Trustee as being given on behalf of the Noteholders without inquiry 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.
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<PAGE>
THE TRUST FUND
GENERAL
The Housing Loans are expected to include 15,085 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 variable 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 Trustee or 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. Generally each Housing
Loan is secured by a registered first ranking mortgage over the related
Mortgaged Property or, if the Housing Loan is not secured by a first ranking
mortgage, the Approved Seller will assign the Issuer Trustee all prior ranking
Registered Mortgages in relation to that Housing Loan. 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, 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.
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<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.
The Issuer Trustee has not investigated or made any inquiries regarding the
accuracy of these 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
the event that any representation or warranty is incorrect are described in
"--Breach of Representations and Warranties" below.
WESTPAC REPRESENTATIONS
Westpac will make representations and warranties with respect to each
Housing Loan as of the Cut-Off Date (except as specified below) and the Closing
Date including that:
(1) it is subject to a Mortgage Insurance Policy (in the case of the
Mortgage Pool Insurance Policy, at the Closing Date);
(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 Issuer 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;
(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 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";
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<PAGE>
(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;
(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) as of the Closing Date, 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.
(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.
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
53
<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 15,085 Housing Loans secured by Mortgages
on Mortgaged Properties located in the six states and two territories in
Australia, New South Wales ("NSW"), Victoria ("Vic"), Queensland ("QLD"), South
Australia ("SA"), Western Australia ("WA"), Tasmania ("TAS"), Northern Territory
("NT") and the Australian Capital Territory ("ACT"). The aggregate Cut-Off Date
Balances Outstanding of the Housing Loans (the "Cut-Off Date Pool Balance")
totaled approximately A$1,600,862,455. The Housing Loans bear interest at
variable and fixed rates. As of the Cut-Off Date, 75.87% of the Housing Loans by
Cut-Off Date Loan Balance are variable rate loans (the "Variable Rate Housing
Loans") and 24.13% 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 7% per
annum. The weighted average Mortgage Rate for the Variable Rate Housing Loans as
of the Cut-Off Date was approximately 6.41% per annum. The lowest Cut-Off Date
Balance Outstanding of any Housing Loan was approximately A$10,027 and the
highest was approximately A$700,000. The average Cut-Off Date Balance
Outstanding of the Housing Loans was approximately A$106,123. The weighted
average original term to stated maturity of the Housing Loans was approximately
296.74 months. The weighted average remaining term to stated maturity of the
Housing Loans was approximately 287.97 months. As of the Cut-Off Date, the
weighted average number of months that have elapsed since origination of the
Housing Loans was approximately 8.77 months. The lowest and highest LVR of the
Housing Loans at Cut-Off Date were approximately 1.99% and 94.96%, respectively.
The weighted average LVR of the Housing Loans was approximately 70.05%.
Housing Loans representing approximately 17.97% of the Cut-Off Date Pool
Balance are secured by Mortgaged Properties which are investment properties
(based solely upon statements made by the related Mortgagors at the time of
origination of the related Housing Loans).
As of the Cut-Off Date, no Housing Loans were more than 30 days Delinquent.
Set forth below is a description of certain additional characteristics with
respect to the Housing Loans held by the Trust and are not indicative of
Westpac's entire portfolio of housing loans. All percentages are approximate and
may not total 100% due to rounding.
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(ALL AMOUNTS EXPRESSED IN AUSTRALIAN DOLLARS)
(ALL %'S ARE APPROXIMATE AND MAY NOT TOTAL 100% DUE TO ROUNDING)
BALANCE OUTSTANDING DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
NUMBER SECURITY BALANCE WEIGHTED AVERAGE % BY % BY
BALANCE OF LOANS VALUE A$* OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------- ----------- ------------- -------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
A$10,001-A$20,000........... 490 $ 74,684,590 $ 7,955,278 $ 16,235 32.75% 3.25% 0.50%
A$20,001-A$30,000........... 803 $ 117,868,960 $ 20,762,191 $ 25,856 36.67% 5.32% 1.30%
A$30,001-A$40,000........... 831 $ 116,925,951 $ 29,717,355 $ 35,761 43.00% 5.51% 1.86%
A$40,001-A$50,000........... 1,027 $ 151,760,718 $ 47,256,697 $ 46,014 48.82% 6.81% 2.95%
A$50,001-A$100,000.......... 5,392 $ 813,180,574 $412,293,217 $ 76,464 66.02% 35.74% 25.75%
A$100,001-A$150,000......... 3,423 $ 642,953,916 $418,918,131 $ 122,383 74.72% 22.69% 26.17%
A$150,001-A$200,000......... 1,812 $ 469,853,336 $311,811,602 $ 172,081 74.82% 12.01% 19.48%
A$200,001-A$250,000......... 705 $ 233,573,954 $157,529,164 $ 223,446 74.18% 4.67% 9.84%
A$250,001-A$300,000......... 318 $ 130,554,300 $ 87,245,448 $ 274,357 74.18% 2.11% 5.45%
A$300,001-A$350,000......... 148 $ 73,897,950 $ 48,307,489 $ 326,402 72.12% 0.98% 3.02%
A$350,001-A$400,000......... 73 $ 43,539,500 $ 27,226,987 $ 372,972 69.51% 0.48% 1.70%
A$400,001-A$450,000......... 16 $ 9,999,000 $ 6,866,768 $ 429,173 70.54% 0.11% 0.43%
A$450,001-A$500,000......... 20 $ 16,190,000 $ 9,633,254 $ 481,663 65.83% 0.13% 0.60%
Above A$500,000............. 27 $ 24,418,000 $ 15,338,873 $ 568,106 66.62% 0.18% 0.96%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
- ------------------------
* Total Security Value is the mortgage property value determined by either
contract of sale, valuation by a registered panel valuer or in remote areas,
a Manager's Assessment as reported on the system as of the Cut-Off Date. See
"WESTPAC RESIDENTIAL LOAN PROGRAM--Underwriting of Housing Loans."
MORTGAGE RATES OF THE FIXED RATE HOUSING LOANS AS OF THE CUT-OFF DATE*
<TABLE>
<CAPTION>
WEIGHTED
NUMBER CURRENT BALANCE MINIMUM MAXIMUM AVERAGE % BY % BY
CURRENT RATES OF LOANS OUTSTANDING A$ RATE (%) RATE (%) RATE (%) NUMBER BALANCE
- -------------------------------- ----------- --------------- ------------- ------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
5.501% less than= 6%............ 650 $ 77,373,996 5.99% 5.99% 5.99% 19.41% 20.03%
6.001% less than= 6.5%.......... 691 $ 80,353,049 6.10% 6.50% 6.33% 20.63% 20.80%
6.501% less than= 7%............ 912 $ 103,352,651 6.53% 7.00% 6.93% 27.23% 26.75%
7.001% less than= 7.5%.......... 261 $ 31,949,037 7.10% 7.50% 7.31% 7.79% 8.27%
7.501% less than= 8%............ 349 $ 38,790,286 7.55% 8.00% 7.77% 10.42% 10.04%
8.001% less than= 8.5%.......... 126 $ 12,865,048 8.09% 8.50% 8.27% 3.76% 3.33%
8.501% less than= 9%............ 282 $ 34,044,140 8.55% 9.00% 8.85% 8.42% 8.81%
9.001% less than= 9.5%.......... 46 $ 4,326,683 9.15% 9.50% 9.45% 1.37% 1.12%
9.501% less than= 10%........... 27 $ 2,432,280 9.55% 9.95% 9.80% 0.81% 0.63%
10.001% less than= 10.5%........ 5 $ 846,806 10.15% 10.15% 10.15% 0.15% 0.22%
----- --------------- ----- ----- ----- ----------- -----------
Total....................... 3,349 $ 386,333,976 5.99% 10.15% 7.00% 100.00% 100.00%
----- --------------- ----- ----- ----- ----------- -----------
----- --------------- ----- ----- ----- ----------- -----------
</TABLE>
- ------------------------
* Each Fixed Rate Housing Loan can convert to a Variable Rate Housing Loan
subject to certain related fees.
55
<PAGE>
GEOGRAPHIC DISTRIBUTION BY REGION*
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
REGION OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------- ----------- ------------- -------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ACT-Metro................... 217 $ 37,513,525 $ 21,734,769 $ 100,160 71.04% 1.44% 1.36%
NSW-Metro................... 4,277 $1,199,889,167 $622,396,144 $ 145,522 68.24% 28.35% 38.88%
NSW-Other................... 1,496 $ 234,098,335 $128,476,778 $ 85,880 69.81% 9.92% 8.03%
NT-Metro.................... 128 $ 25,552,640 $ 15,995,695 $ 124,966 74.05% 0.85% 1.00%
NT-Other.................... 51 $ 9,268,200 $ 5,254,589 $ 103,031 70.24% 0.34% 0.33%
QLD-Metro................... 1,206 $ 211,574,342 $118,556,876 $ 98,306 70.08% 7.99% 7.41%
QLD-Other................... 1,671 $ 265,908,115 $151,761,557 $ 90,821 71.87% 11.08% 9.48%
SA-Metro.................... 457 $ 64,943,338 $ 37,097,066 $ 81,175 73.46% 3.03% 2.32%
SA-Other.................... 135 $ 13,643,841 $ 8,458,945 $ 62,659 75.24% 0.89% 0.53%
TAS-Metro................... 157 $ 19,075,900 $ 10,933,450 $ 69,640 71.40% 1.04% 0.68%
TAS-Other................... 158 $ 16,210,125 $ 10,015,085 $ 63,387 74.21% 1.05% 0.63%
Vic-Metro................... 2,415 $ 413,878,865 $241,322,800 $ 99,927 71.76% 16.01% 15.07%
Vic-Other................... 648 $ 70,738,444 $ 43,228,711 $ 66,711 73.59% 4.30% 2.70%
WA-Metro.................... 1,589 $ 272,550,892 $146,740,585 $ 92,348 69.66% 10.53% 9.17%
WA-Other.................... 480 $ 64,555,020 $ 38,889,404 $ 81,020 71.28% 3.18% 2.43%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</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 WEIGHTED
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%........... 27 $ 15,012,500 $ 569,547 $ 21,094 3.99% 0.18% 0.04%
5% less than= 10%........... 181 $ 57,903,700 $ 4,388,709 $ 24,247 7.95% 1.20% 0.27%
10% less than= 15%.......... 296 $ 78,614,209 $ 9,758,816 $ 32,969 12.66% 1.96% 0.61%
15% less than= 20%.......... 388 $ 102,570,255 $ 17,793,468 $ 45,859 17.78% 2.57% 1.11%
20% less than= 25%.......... 519 $ 130,697,100 $ 28,537,624 $ 54,986 22.66% 3.44% 1.78%
25% less than= 30%.......... 596 $ 151,298,125 $ 39,301,097 $ 65,941 27.61% 3.95% 2.45%
30% less than= 35%.......... 739 $ 181,158,395 $ 55,278,315 $ 74,802 32.60% 4.90% 3.45%
35% less than= 40%.......... 536 $ 123,210,425 $ 43,836,903 $ 81,785 37.50% 3.55% 2.74%
40% less than= 45%.......... 589 $ 134,233,978 $ 54,141,416 $ 91,921 42.53% 3.90% 3.38%
45% less than= 50%.......... 401 $ 91,906,200 $ 41,578,949 $ 103,688 47.55% 2.66% 2.60%
50% less than= 55%.......... 787 $ 176,716,190 $ 85,862,432 $ 109,101 52.53% 5.22% 5.36%
55% less than= 60%.......... 677 $ 142,624,529 $ 73,970,425 $ 109,262 57.56% 4.49% 4.62%
60% less than= 65%.......... 778 $ 156,380,850 $ 91,718,665 $ 117,890 62.59% 5.16% 5.73%
65% less than= 70%.......... 722 $ 141,699,592 $ 85,499,705 $ 118,421 67.56% 4.79% 5.34%
70% less than= 75%.......... 862 $ 155,471,471 $102,338,336 $ 118,722 72.65% 5.71% 6.39%
75% less than= 80%.......... 2,228 $ 388,869,931 $284,044,346 $ 127,488 78.19% 14.77% 17.74%
80% less than= 85%.......... 638 $ 100,320,251 $ 75,797,470 $ 118,805 83.03% 4.23% 4.73%
85% less than= 90%.......... 1,931 $ 285,490,193 $235,441,924 $ 121,927 88.17% 12.80% 14.71%
90% less than= 95%.......... 2,190 $ 305,222,855 $271,004,310 $ 123,746 93.05% 14.52% 16.93%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
56
<PAGE>
MORTGAGE INSURER DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
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........................ 9,699 $2,115,550,008 $964,409,083 $ 99,434 58.68% 64.30% 60.24%
HLIC........................ 2,408 $ 376,807,027 $305,354,699 $ 126,808 86.61% 15.96% 19.07%
MGICA....................... 11 $ 1,828,900 $ 1,447,028 $ 131,548 86.81% 0.07% 0.09%
Royal & Sun/WLMI............ 2,967 $ 425,214,814 $329,651,646 $ 111,106 87.87% 19.67% 20.59%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
PRODUCT DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
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>
First Option................ 4,587 $ 921,747,629 $574,833,698 $ 125,318 73.25% 30.41% 35.91%
Fixed Options............... 1,363 $ 292,675,600 $148,199,407 $ 108,730 70.31% 9.04% 9.26%
IPL*--First Option.......... 774 $ 165,225,175 $103,236,306 $ 133,380 69.20% 5.13% 6.45%
IPL*--Fixed Rate............ 693 $ 157,260,901 $ 90,028,888 $ 129,912 67.12% 4.59% 5.62%
IPL*--Special Fixed Rate.... 328 $ 69,790,488 $ 40,599,876 $ 123,780 67.31% 2.17% 2.54%
IPL*--Variable Rate......... 609 $ 112,321,100 $ 53,817,522 $ 88,370 63.20% 4.04% 3.36%
Premium Option.............. 5,766 $1,039,354,033 $482,640,952 $ 83,705 66.25% 38.22% 30.15%
Special Options Fixed
Rate...................... 965 $ 161,025,823 $107,505,805 $ 111,405 77.31% 6.40% 6.72%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
- ------------------------------
* Investment Property Loan
SETTLEMENT PERIOD DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
SETTLEMENT NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY
PERIOD OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER
- -------------------------------------- ----------- ------------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Prior 01/11/1996...................... 1,227 $ 228,127,651 $116,658,848 $ 95,076 66.97% 8.13%
After 01/11/1996...................... 13,858 $2,691,273,098 1$,484,203,607 $ 107,101 70.29% 91.87%
----------- ------------- -------------- ----------- ----- -----------
Total............................. 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00%
----------- ------------- -------------- ----------- ----- -----------
----------- ------------- -------------- ----------- ----- -----------
<CAPTION>
SETTLEMENT % BY
PERIOD BALANCE
- -------------------------------------- -----------
<S> <C>
Prior 01/11/1996...................... 7.29%
After 01/11/1996...................... 92.71%
-----------
Total............................. 100.00%
-----------
-----------
</TABLE>
FIXED RATE HOUSING LOAN REPRICING DISTRIBUTION
<TABLE>
<CAPTION>
MONTH/YEAR OF CONVERSION FROM TOTAL CURRENT WEIGHTED
FIXED RATE HOUSING LOAN TO NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY
VARIABLE RATE HOUSING LOAN OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER
- ---------------------------------------- ----------- ----------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
May-1998................................ 154 $28,120,550 $ 16,540,428 $ 107,405 71.33% 4.60%
Jun-1998................................ 167 $31,186,144 $ 18,231,101 $ 109,168 72.81% 4.99%
Jul-1998................................ 180 $34,401,537 $ 19,764,840 $ 109,805 69.40% 5.37%
Aug-1998................................ 255 $47,734,243 $ 28,700,338 $ 112,550 71.75% 7.61%
Sep-1998................................ 251 $47,040,497 $ 27,878,481 $ 111,070 73.19% 7.49%
Oct-1998................................ 235 $43,990,878 $ 26,364,585 $ 112,190 73.22% 7.02%
Nov-1998................................ 190 $34,736,800 $ 22,417,137 $ 117,985 75.65% 5.67%
Dec-1998................................ 205 $37,272,000 $ 23,902,645 $ 116,598 77.65% 6.12%
Jan-1999................................ 138 $23,448,938 $ 15,660,833 $ 113,484 77.62% 4.12%
Feb-1999................................ 86 $14,555,065 $ 9,246,125 $ 107,513 76.93% 2.57%
Mar-1999................................ 61 $14,447,000 $ 8,124,342 $ 133,186 74.02% 1.82%
Apr-1999................................ 34 $ 7,588,040 $ 3,255,046 $ 95,737 69.66% 1.02%
May-1999................................ 43 $ 7,967,500 $ 4,277,785 $ 99,483 64.76% 1.28%
Jun-1999................................ 34 $ 7,584,300 $ 3,352,397 $ 98,600 61.04% 1.02%
<CAPTION>
MONTH/YEAR OF CONVERSION FROM
FIXED RATE HOUSING LOAN TO % BY
VARIABLE RATE HOUSING LOAN BALANCE
- ---------------------------------------- -----------
<S> <C>
May-1998................................ 4.28%
Jun-1998................................ 4.72%
Jul-1998................................ 5.12%
Aug-1998................................ 7.43%
Sep-1998................................ 7.22%
Oct-1998................................ 6.82%
Nov-1998................................ 5.80%
Dec-1998................................ 6.19%
Jan-1999................................ 4.05%
Feb-1999................................ 2.39%
Mar-1999................................ 2.10%
Apr-1999................................ 0.84%
May-1999................................ 1.11%
Jun-1999................................ 0.87%
</TABLE>
57
<PAGE>
MONTH/YEAR OF CONVERSION FROM FIXED RATE TO VARIABLE RATE
<TABLE>
<CAPTION>
MONTH/YEAR OF CONVERSION FROM TOTAL CURRENT WEIGHTED
FIXED RATE HOUSING LOAN TO NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY
VARIABLE RATE HOUSING LOAN OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER
- ---------------------------------------- ----------- ----------- -------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Jul-1999................................ 28 $ 6,439,400 $ 3,573,541 $ 127,626 68.85% 0.84%
Aug-1999................................ 49 $10,941,000 $ 5,958,598 $ 121,604 68.59% 1.46%
Sep-1999................................ 38 $ 7,141,900 $ 3,711,969 $ 97,683 68.50% 1.13%
Oct-1999................................ 44 $ 8,103,210 $ 4,568,988 $ 103,841 70.76% 1.31%
Nov-1999................................ 29 $ 6,609,250 $ 3,693,698 $ 127,369 69.47% 0.87%
Dec-1999................................ 34 $ 7,661,900 $ 3,863,450 $ 113,631 65.85% 1.02%
Jan-2000................................ 31 $ 6,284,263 $ 3,806,513 $ 122,791 72.70% 0.93%
Feb-2000................................ 92 $19,737,888 $ 11,653,391 $ 126,667 71.23% 2.75%
Mar-2000................................ 65 $13,928,400 $ 7,151,109 $ 110,017 68.12% 1.94%
Apr-2000................................ 26 $ 5,688,300 $ 2,859,307 $ 109,973 66.47% 0.78%
May-2000................................ 32 $ 7,573,800 $ 4,034,581 $ 126,081 60.83% 0.96%
Jun-2000................................ 18 $ 4,307,500 $ 2,032,735 $ 112,930 66.80% 0.54%
Jul-2000................................ 26 $ 6,365,900 $ 2,775,515 $ 106,751 64.13% 0.78%
Aug-2000................................ 44 $ 9,321,350 $ 5,059,022 $ 114,978 64.17% 1.31%
Sep-2000................................ 49 $11,275,700 $ 5,418,528 $ 110,582 63.28% 1.46%
Oct-2000................................ 63 $15,388,000 $ 7,561,061 $ 120,017 67.50% 1.88%
Nov-2000................................ 53 $10,694,700 $ 6,680,598 $ 126,049 75.47% 1.58%
Dec-2000................................ 71 $16,233,500 $ 7,876,383 $ 110,935 66.90% 2.12%
Jan-2001................................ 62 $16,389,128 $ 9,189,935 $ 148,225 70.62% 1.85%
Feb-2001................................ 22 $ 4,937,500 $ 2,842,524 $ 129,206 73.52% 0.66%
Mar-2001................................ 15 $ 3,222,000 $ 1,991,384 $ 132,759 72.34% 0.45%
Apr-2001................................ 12 $ 1,643,500 $ 1,245,848 $ 103,821 80.62% 0.36%
May-2001................................ 10 $ 2,276,100 $ 1,279,509 $ 127,951 66.37% 0.30%
Jun-2001................................ 6 $ 1,459,000 $ 1,029,330 $ 171,555 76.42% 0.18%
Jul-2001................................ 5 $ 581,500 $ 339,680 $ 67,936 66.89% 0.15%
Aug-2001................................ 10 $ 2,722,000 $ 1,274,206 $ 127,421 61.27% 0.30%
Sep-2001................................ 12 $ 3,619,500 $ 1,545,312 $ 128,776 67.58% 0.36%
Oct-2001................................ 12 $ 2,820,000 $ 1,796,423 $ 149,702 71.30% 0.36%
Nov-2001................................ 10 $ 2,159,000 $ 885,688 $ 88,569 57.27% 0.30%
Dec-2001................................ 5 $ 1,743,000 $ 733,712 $ 146,742 51.51% 0.15%
Jan-2002................................ 7 $ 2,210,000 $ 1,090,994 $ 155,856 73.15% 0.21%
Feb-2002................................ 3 $ 990,000 $ 356,102 $ 118,701 56.24% 0.09%
Mar-2002................................ 11 $ 1,947,900 $ 984,623 $ 89,511 68.55% 0.33%
Apr-2002................................ 16 $ 3,231,500 $ 1,577,277 $ 98,580 69.80% 0.48%
May-2002................................ 23 $ 7,225,500 $ 3,504,124 $ 152,353 59.24% 0.69%
Jun-2002................................ 15 $ 4,098,900 $ 2,270,937 $ 151,396 68.21% 0.45%
Jul-2002................................ 15 $ 2,433,500 $ 1,308,421 $ 87,228 68.97% 0.45%
Aug-2002................................ 32 $ 6,879,500 $ 3,602,881 $ 112,590 65,83% 0.96%
Sep-2002................................ 44 $11,734,000 $ 5,435,966 $ 123,545 66.75% 1.31%
Oct-2002................................ 29 $ 6,374,500 $ 2,690,529 $ 92,777 65.31% 0.87%
Nov-2002................................ 28 $ 6,596,500 $ 3,602,562 $ 128,663 67.51% 0.84%
Dec-2002................................ 49 $12,909,927 $ 6,252,929 $ 127,611 67.93% 1.46%
Jan-2003................................ 21 $ 5,260,500 $ 2,634,560 $ 125,455 66.49% 0.63%
Feb-2003................................ 24 $ 5,010,904 $ 2,931,874 $ 122,161 68.13% 0.72%
Mar-2003................................ 21 $ 5,809,500 $ 3,420,145 $ 162,864 68.73% 0.63%
Apr-2003................................ 4 $ 610,000 $ 452,137 $ 113,034 80.34% 0.12%
May-2003................................ 1 $ 88,500 $ 69,296 $ 69,296 78.30% 0.03%
----- ----------- -------------- ----------- ----- -----------
Total............................... 3,349 $680,752,812 $386,333,976 $ 115,358 71.20% 100.00%
----- ----------- -------------- ----------- ----- -----------
----- ----------- -------------- ----------- ----- -----------
<CAPTION>
MONTH/YEAR OF CONVERSION FROM
FIXED RATE HOUSING LOAN TO % BY
VARIABLE RATE HOUSING LOAN BALANCE
- ---------------------------------------- -----------
<S> <C>
Jul-1999................................ 0.92%
Aug-1999................................ 1.54%
Sep-1999................................ 0.96%
Oct-1999................................ 1.18%
Nov-1999................................ 0.96%
Dec-1999................................ 1.00%
Jan-2000................................ 0.99%
Feb-2000................................ 3.02%
Mar-2000................................ 1.85%
Apr-2000................................ 0.74%
May-2000................................ 1.04%
Jun-2000................................ 0.53%
Jul-2000................................ 0.72%
Aug-2000................................ 1.31%
Sep-2000................................ 1.40%
Oct-2000................................ 1.96%
Nov-2000................................ 1.73%
Dec-2000................................ 2.04%
Jan-2001................................ 2.38%
Feb-2001................................ 0.74%
Mar-2001................................ 0.52%
Apr-2001................................ 0.32%
May-2001................................ 0.33%
Jun-2001................................ 0.27%
Jul-2001................................ 0.09%
Aug-2001................................ 0.33%
Sep-2001................................ 0.40%
Oct-2001................................ 0.46%
Nov-2001................................ 0.23%
Dec-2001................................ 0.19%
Jan-2002................................ 0.28%
Feb-2002................................ 0.09%
Mar-2002................................ 0.25%
Apr-2002................................ 0.41%
May-2002................................ 0.91%
Jun-2002................................ 0.59%
Jul-2002................................ 0.34%
Aug-2002................................ 0.93%
Sep-2002................................ 1.41%
Oct-2002................................ 0.70%
Nov-2002................................ 0.93%
Dec-2002................................ 1.62%
Jan-2003................................ 0.68%
Feb-2003................................ 0.76%
Mar-2003................................ 0.89%
Apr-2003................................ 0.12%
May-2003................................ 0.02%
-----------
Total............................... 100.00%
-----------
-----------
</TABLE>
58
<PAGE>
MORTGAGES BY YEAR OF MATURITY
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
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>
2000........................ 13 $ 2,328,000 $ 555,761 $ 42,751 49.91% 0.09% 0.03%
2001........................ 21 $ 3,870,300 $ 870,467 $ 41,451 48.23% 0.14% 0.05%
2002........................ 73 $ 12,482,950 $ 3,918,843 $ 53,683 52.03% 0.48% 0.24%
2003........................ 36 $ 5,975,463 $ 1,252,236 $ 34,784 32.93% 0.24% 0.08%
2004........................ 56 $ 7,348,000 $ 2,289,671 $ 40,887 47.43% 0.37% 0.14%
2005........................ 40 $ 5,851,500 $ 2,143,681 $ 53,592 52.02% 0.27% 013%
2006........................ 54 $ 9,086,500 $ 2,650,201 $ 49,078 41.43% 0.36% 0.17%
2007........................ 416 $ 71,202,200 $ 20,433,949 $ 49,120 42.18% 2.76% 1.28%
2008........................ 97 $ 15,752,350 $ 5,504,601 $ 56,748 47.19% 0.64% 0.34%
2009........................ 57 $ 10,563,500 $ 3,616,487 $ 63,447 45.92% 0.38% 0.23%
2010........................ 38 $ 7,971,000 $ 3,335,037 $ 87,764 53.15% 0.25% 0.21%
2011........................ 94 $ 17,068,500 $ 5,803,349 $ 61,738 50.03% 0.62% 0.36%
2012........................ 523 $ 91,450,097 $ 36,007,793 $ 68,849 52.76% 3.47% 2.25%
2013........................ 104 $ 17,812,650 $ 7,974,749 $ 76,680 58.31% 0.69% 0.50%
2014........................ 57 $ 10,032,205 $ 4,666,911 $ 81,876 61.54% 0.38% 0.29%
2015........................ 74 $ 12,561,600 $ 5,324,920 $ 71,958 59.03% 0.49% 0.33%
2016........................ 166 $ 27,933,400 $ 12,094,329 $ 72,857 61.26% 1.10% 0.76%
2017........................ 783 $ 153,032,760 $ 66,800,311 $ 85,313 59.44% 5.19% 4.17%
2018........................ 159 $ 32,056,315 $ 13,115,982 $ 82,490 57.26% 1.05% 0.82%
2019........................ 86 $ 13,962,500 $ 7,818,544 $ 90,913 67.97% 0.57% 0.49%
2020........................ 104 $ 19,917,500 $ 10,111,411 $ 97,225 61.74% 0.69% 0.63%
2021........................ 639 $ 128,304,590 $ 66,958,324 $ 104,786 66.36% 4.24% 4.18%
2022........................ 7,539 $1,505,307,277 $884,279,868 $ 117,294 71.61% 49.98% 55.24%
2023........................ 1,349 $ 274,213,017 $165,488,348 $ 122,675 73.56% 8.94% 10.34%
2024........................ 22 $ 3,701,500 $ 1,775,103 $ 80,687 68.39% 0.15% 0.11%
2025........................ 38 $ 8,642,000 $ 4,182,605 $ 110,069 62.51% 0.25% 0.26%
2026........................ 355 $ 68,869,561 $ 39,271,218 $ 110,623 73.52% 2.35% 2.45%
2027........................ 1,664 $ 300,234,586 $172,818,847 $ 103,857 75.93% 11.03% 10.80%
2028........................ 428 $ 81,868,928 $ 49,798,907 $ 116,353 76.67% 2.84% 3.11%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
YEAR OF ORIGINATION (QUARTERLY)
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
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>
1996 Q2 496 $ 91,843,968 $ 46,366,955 $ 93,482 67.66% 3.29% 2.90%
1996 Q3 593 $ 109,352,215 $ 55,294,978 $ 93,246 65.87% 3.93% 3.45%
1996 Q4 346 $ 70,307,769 $ 36,674,291 $ 105,995 68.15% 2.29% 2.29%
1997 Q1 735 $ 145,726,029 $ 70,742,856 $ 96,249 66.22% 4.87% 4.42%
1997 Q2 1,715 $ 340,758,082 $172,973,457 $ 100,859 66.35% 11.37% 10.81%
1997 Q3 4,306 $ 823,342,798 $459,616,512 $ 106,739 69.81% 28.54% 28.71%
1997 Q4 4,835 $ 929,267,173 $531,353,830 $ 109,897 72.13% 32.05% 33.19%
1998 Q1 2,059 $ 408,802,715 $227,839,576 $ 110,655 71.48% 13.65% 14.23%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
59
<PAGE>
OCCUPANCY OF MORTGAGE PROPERTY DISTRIBUTION*
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
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.................. 2,404 $ 504,597,664 $287,682,592 $ 119,668 67.16% 15.94% 17.97%
Owner Occupied.............. 12,681 $2,414,803,085 1$,313,179,862 $ 103,555 70.68% 84.06% 82.03%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
- ------------------------
* Based solely on statements of Mortgagors at time of origination.
PAYMENT TYPE DISTRIBUTION
<TABLE>
<CAPTION>
TOTAL CURRENT WEIGHTED
NUMBER SECURITY BALANCE AVERAGE AVERAGE % BY % BY
PAYMENT TYPE OF LOANS VALUE A$ OUTSTANDING A$ BALANCE A$ LVR (%) NUMBER BALANCE
- ---------------------------- ----------- ------------- -------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Interest Only............... 386 $ 120,176,550 $ 63,183,149 $ 163,687 64.55% 2.56% 3.95%
Principal & Interest........ 14,699 $2,799,224,199 1$,537,679,306 $ 104,611 70.27% 97.44% 96.05%
----------- ------------- -------------- ----------- ----- ----------- -----------
Total................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- ----------- ----- ----------- -----------
----------- ------------- -------------- ----------- ----- ----------- -----------
</TABLE>
HOUSING LOAN PROPERTY TYPES
<TABLE>
<CAPTION>
TOTAL CURRENT AVERAGE WEIGHTED
NUMBER SECURITY BALANCE % BY AVERAGE % BY % BY
PROPERTY TYPE OF LOANS VALUE A$ OUTSTANDING A$ BALANCE LVR (%) NUMBER BALANCE
- ------------------------------ ----------- ------------- -------------- --------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Detached houses............... 12,844 $2,487,492,592 1$,335,886,724 $ 104,009 69.50% 85.14% 83.45%
Semi-detached houses.......... 226 $ 47,144,311 $ 28,822,775 $ 127,534 73.33% 1.50% 1.80%
Townhouses.................... 77 $ 14,374,425 $ 11,279,326 $ 146,485 88.10% 0.51% 0.70%
Strata title units............ 1,938 $ 370,389,421 $224,873,629 $ 116,034 71.97% 12.85% 14.05%
----------- ------------- -------------- --------- ----- ----------- -----------
Total......................... 15,085 $2,919,400,749 1$,600,862,455 $ 106,123 70.05% 100.00% 100.00%
----------- ------------- -------------- --------- ----- ----------- -----------
----------- ------------- -------------- --------- ----- ----------- -----------
</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, 50
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.
60
<PAGE>
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$6.4 billion in this capacity and has been servicing Westpac and Westpac's
clients since 1944.
The Issuer Trustee is an Authorized Trustee Corporation under 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.
EXPERIENCE
Currently, the Issuer Trustee is the trustee for superannuation trusts with
assets exceeding A$3.9 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$97.4 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 OFFICE ADDRESS PRINCIPAL ACTIVITIES
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
Martyn John Berry Level 36, Westpac Plaza Investment Fund Executive
50 Margaret Street
Sydney NSW 2000, Australia
David Matthew Fite Level 36, Westpac Plaza Bank Executive
50 Margaret Street
Sydney NSW 2000, Australia
John Charles Lawson Level 36, Westpac Plaza Banker
50 Margaret Street
Sydney NSW 2000, Australia
Robert McDonald Level 36, Westpac Plaza Finance Executive
50 Margaret Street
Sydney NSW 2000, Australia
Michael Anthony Migro Level 36, Westpac Plaza Manager
50 Margaret Street
Sydney NSW 2000, 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.
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<PAGE>
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.
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
or on the part of any of its officers, employees, agents or delegates, 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.
(5) In making any such determination, the Issuer Trustee will seek and
rely on advice given to it by its advisors 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;
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<PAGE>
(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, the Beneficiary or the Approved Seller on
specified dates;
(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.
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 in writing 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 or any event occurs 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 such removal. The Issuer Trustee will indemnify the Trust Manager
and the Trust for such 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
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<PAGE>
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.
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, or on
the part of any of its officers, employees, agents or delegates, 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. The Approved Sellers have also indemnified the Issuer Trustee in
relation to such payments and the Issuer Trustee is required to first call on
the indemnity from the Approved Sellers.
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 Servicer or either of the
Approved Sellers except to the extent that it is caused by the Issuer Trustee's
or its officer's, employee's, agent's or delegate's fraud, negligence or breach
of trust. 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.
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
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<PAGE>
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, 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
willful default.
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.
THE NOTE TRUSTEE
Morgan Guaranty Trust Company of New York, London Branch (the "Note
Trustee"), 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"). Morgan Guaranty is a wholly
owned subsidiary and the principal asset of J.P. Morgan & Co. Incorporated, a
Delaware corporation whose principal office is located in New York, New York.
Morgan Guaranty Trust Company of New York 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. 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. Upon the completion of such
acquisition, Citibank, N.A. will act as Note Trustee.
65
<PAGE>
ORIGINATOR OF THE HOUSING LOANS
Westpac Banking Corporation ("Westpac"), Level 4, 60 Martin Place, Sydney,
NSW 2000, Australia, was the first bank to be established in Australia. Westpac
was founded in 1817 and was incorporated in 1850 as Bank of New South Wales by
an Act of the New South Wales Parliament. In 1982, the Bank acquired The
Commercial Bank of Australia Limited, and the Bank changed its name to Westpac
Banking Corporation.
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 Australian 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 approximately 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 systems will be
materially 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.
THE SERVICER
GENERAL
In 1996, Westpac established a wholly owned subsidiary, The Mortgage Company
Pty Limited ("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 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
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<PAGE>
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: (i)
in accordance with the Servicing Agreement; (ii) in accordance with 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 installment 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
installment 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 of the Borrower, 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 the housing loan's progress 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 collection system of the MPC. 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 make
payments so that his account is current. When the account reaches between 23 and
29 days delinquent, the borrower will be contacted by telephone or, if not
contacted, a second letter will be sent by day 30. Between day 30 and day 45
generally the borrower will again be 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.
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<PAGE>
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.
"Mortgagee 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. Similar information with respect to the Series
1998-1G WST Trust will be contained in the reports presented through Reuters for
access by investors. Such reports will be compiled using the same methodology as
that used to compile the information contained in the table below.
DELINQUENCIES AND MIP
SERIES 1997-2 WST TRUST
<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.................. 44 4,086,266 0.74 0.79 38 3,846,360 0.67
60-89 Days.................. 10 1,151,603 0.17 0.22 15 1,631,217 0.27
90 Days or more............. 3 466,842 0.05 0.09 4 463,744 0.08
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.................. 0.80
60-89 Days.................. 0.34
90 Days or more............. 0.10
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 1997-3 WST TRUST
<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.................. 36 3,153,716 0.53 0.50 49 5,052,285 0.75
60-89 Days.................. 15 1,274,948 0.22 0.20 13 1,201,231 0.20
90 Days or more............. 7 846,185 0.10 0.13 11 1,393,831 0.17
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.................. 0.85
60-89 Days.................. 0.20
90 Days or more............. 0.23
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 1997-4E WST TRUST
<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.................. 16 1,805,138 0.25 0.27 30 3,299,468 0.48
60-89 Days.................. 6 727,943 0.09 0.11 7 824,236 0.11
90 Days or more............. 2 172,916 0.03 0.02 6 328,043 0.09
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.................. 0.51
60-89 Days.................. 0.13
90 Days or more............. 0.05
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.
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.
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<PAGE>
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 4, 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.
DIRECTORS
The directors of the Trust Manager are as follows:
<TABLE>
<CAPTION>
NAME BUSINESS ADDRESS PRINCIPAL ACTIVITIES
- ------------------------------ --------------------------------------- ---------------------------------------
<S> <C> <C>
R. Patrick Handley Level 4, 60 Martin Place Bank Executive
Sydney, NSW 2000
Australia
Philip Chronican Level 4, 60 Martin Place Bank Executive
Sydney, NSW 2000
Australia
Lewis E. Love, Jr. 575 Fifth Avenue Legal Counsel
39th Floor
New York, New York 10017-2422
Marten Touw Level 4, 60 Martin Place Group Treasurer
Sydney, NSW 2000
Australia
Kimberley Gire Level 4, 60 Martin Place Head of Group Securitization
Sydney, NSW 2000
Australia
</TABLE>
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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 without limitation 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 in writing 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 such 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 information
provided by, or action taken by, the Servicer, or if the Trust Manager has
not received information from the Servicer which the Trust Manager requires
to comply with the obligation or duty); 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
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reasonable satisfaction within 90 days after notice from the Issuer Trustee
where (as determined by the Issuer Trustee) it has an Adverse Effect.
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 default 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.
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WESTPAC RESIDENTIAL LOAN PROGRAM
ORIGINATION OF HOUSING LOANS
The following are the primary sources for the origination of housing loans
for Westpac: 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.
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 do 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
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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 loss from a mortgage default
which follows from physical loss, destruction or damage to a Mortgaged Property
which is not otherwise covered by adequate property insurance.
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.
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 and then convert 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,
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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
refinancing 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 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. For the risks associated with the change in features,
see "RISK FACTORS--Ability to Change Housing Loan Features May Result in Changes
to the Mortgage Pool and Higher Principal Prepayment on the Offered Notes."
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 if 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."
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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.
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 for which Westpac provides 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 capitalize 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 amortized 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
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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 one to five 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 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$55,000,000.
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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 Royal & Sun Alliance Lenders Mortgage
Insurance Limited (ACN 001 825 725) of Level 9, 465 Victoria Avenue, Chatswood
NSW ("Royal & Sun"), MGICA Limited (ACN 000 511 071) 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 covered by an HLIC, Royal & Sun, WLMI
or an MGICA Insurance Policy) (see "--Primary Mortgage Insurance Policies"
below).
PERIOD OF COVER
The Issuer Trustee has the benefit of the Mortgage Pool Insurance Policy in
respect of each relevant 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, equal to 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;
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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
(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 an approved 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.
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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$55,000,000.
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;
(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 Mortgage Pool 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 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 Pool Insurance Policy.
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<PAGE>
Circumstances in which claims under the Mortgage Pool 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 Pool 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 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 to take action, in relation to the relevant Housing Loan or related
Mortgage.
VARIATIONS
HLIC may not vary the Mortgage Pool 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 Pool Insurance Policy, HLIC is not in breach of the law.
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<PAGE>
HOUSING LOAN INSURANCE CORPORATION LTD (HLIC)
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. 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 $472,015,286
as of the Cut-Off Date.
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
Royal & Sun, MGICA, WLMI or HLIC (a "PMI Policy"). Westpac is required to
equitably assign its interest in each PMI Policy to the Issuer Trustee on the
Closing Date. The consent of Royal & Sun, MGICA, WLMI and HLIC is required for
the assignment of the relevant Mortgages and the PMI 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.
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 PMI Policy;
(4) that any premium is not paid when due or 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.
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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.
DESCRIPTION OF ROYAL & SUN, MGICA AND WLMI
The Royal & Sun Alliance Group entered into the lenders mortgage insurance
market in Australia in 1989. Royal & Sun's Mortgage Insurance Division operates
as one of the major divisions of the Royal & Sun Alliance Group. Royal & Sun is
a subsidiary of Royal & Sun Alliance 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
Limited is rated AA- by Standard & Poor's for its claim paying ability and A2 by
Moody's for its claim paying ability, and is owned by the Royal & Sun Alliance
group. Under a deed of indemnity, Royal & Sun is explicitly indemnified for
past, present and future obligations arising from insurance contracts net of
reinsurance by the Australian holding company for the group, Royal & Sun
Alliance Insurance Australia Holdings Limited. The business address of Royal &
Sun 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, AMP Limited ("AMP"), Australia's largest insurance
company. 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$50 million 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 & Sun Alliance Lenders Mortgage
Insurance Limited both dated August 27, 1996 Royal & Sun 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, Royal & Sun 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.
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PREPAYMENT AND YIELD CONSIDERATIONS
The following information is given solely to illustrate the effect of
prepayments of the Housing Loans on the weighted average life of the Offered
Notes under the stated assumptions and is not a prediction of the prepayment
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).
PREPAYMENTS
Prepayments, 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 prepayments. 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 an Offered Note is purchased at a discount
or premium, and the degree to which the timing of payments thereon is sensitive
to prepayments, liquidations and purchases of such Housing Loans. The rate of
prepayment 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 prepayments 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 prepayments 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 Offered Notes will not
be entirely offset by a subsequent like reduction (or increase) in the rate of
principal payments. The weighted average life of the Offered Notes will also 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 prepayment rate model ("CPR").
CPR represents an assumed constant rate of prepayment 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 prepayment
experience or a prediction of the anticipated rate of prepayment 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 prepayments on the Housing Loans.
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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 9, 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 July 1998 (with no defaults), (iv) all
prepayments are prepayments in full received on the last day of each month and
include 30 days' interest thereon, (v) Principal Collections are distributed
according to the rules of distribution set forth in "DESCRIPTION OF THE OFFERED
NOTES--Payments of Principal on the Notes"; and (vi) no optional termination is
exercised. 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 assumed CPR to
maturity or that all Housing Loans will prepay at the same rate. The assumed CPR
for this transaction is 22.5%. 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 assumed CPRs 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 prepayment rates under a variety of the assumptions discussed herein
as well as other relevant assumptions.
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PERCENT OF ORIGINAL INVESTED AMOUNT OUTSTANDING AT THE FOLLOWING PERCENTAGES OF
CPR(1)
<TABLE>
<CAPTION>
CLASS A NOTES: US$
---------------------------------------------------------------------------
DATE 0% 10% 15% 20% 22.5% 25% 35% 45%
- -------------------------------------------- --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percent............................. 100 100 100 100 100 100 100 100
April 19, 1999.............................. 98 90 86 81 79 77 68 59
April 19, 2000.............................. 97 79 71 63 60 56 43 31
April 19, 2001.............................. 95 70 59 49 45 41 27 16
April 19, 2002.............................. 92 61 48 38 34 30 17 9
April 19, 2003.............................. 90 53 40 30 26 22 11 4
April 19, 2004.............................. 88 46 33 23 19 16 7 2
April 19, 2005.............................. 85 40 27 18 15 12 4 1
April 19, 2006.............................. 82 35 23 14 11 8 2 0
April 19, 2007.............................. 79 31 18 11 8 6 1 0
April 19, 2008.............................. 76 26 15 8 6 4 1 0
April 19, 2009.............................. 72 23 12 6 4 3 0 0
April 19, 2010.............................. 69 19 10 5 3 2 0 0
April 19, 2011.............................. 65 17 8 3 2 1 0 0
April 19, 2012.............................. 60 14 6 2 1 1 0 0
April 19, 2013.............................. 56 12 5 2 1 0 0 0
April 19, 2014.............................. 51 10 4 1 0 0 0 0
April 19, 2015.............................. 46 8 3 1 0 0 0 0
April 19, 2016.............................. 41 6 2 0 0 0 0 0
April 19, 2017.............................. 35 5 1 0 0 0 0 0
April 19, 2018.............................. 29 3 1 0 0 0 0 0
April 19, 2019.............................. 23 2 0 0 0 0 0 0
April 19, 2020.............................. 16 1 0 0 0 0 0 0
April 19, 2021.............................. 9 0 0 0 0 0 0 0
April 19, 2022.............................. 1 0 0 0 0 0 0 0
April 19, 2023.............................. 0 0 0 0 0 0 0 0
Weighted Average Life(2)--
To Maturity (Years)....................... 15.042 7.000 5.212 4.052 3.626 3.267 2.284 1.696
To Call (Years)........................... 14.979 6.685 4.880 3.752 3.350 3.022 2.121 1.575
</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 three decimal places.
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PERCENT OF ORIGINAL INVESTED AMOUNT OUTSTANDING AT THE FOLLOWING PERCENTAGES OF
CPR(1)
<TABLE>
<CAPTION>
CLASS B NOTES: $
---------------------------------------------------------------------------
DATE 0% 10% 15% 20% 22.5% 25% 35% 45%
- ------------------------------------------ --------- --------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percent........................... 100 100 100 100 100 100 100 100
April 19, 1999............................ 100 100 100 100 100 100 100 100
April 19, 2000............................ 100 100 100 100 100 100 95 86
April 19, 2001............................ 100 100 100 100 97 93 76 64
April 19, 2002............................ 100 100 100 83 73 68 48 34
April 19, 2003............................ 100 100 83 65 55 50 31 34
April 19, 2004............................ 100 97 69 50 42 36 24 34
April 19, 2005............................ 100 84 57 39 31 26 24 34
April 19, 2006............................ 100 74 46 30 24 21 24 34
April 19, 2007............................ 100 64 38 23 20 21 24 18
April 19, 2008............................ 100 55 31 21 20 21 24 10
April 19, 2009............................ 100 47 25 21 20 21 24 5
April 19, 2010............................ 100 41 20 21 20 21 19 3
April 19, 2011............................ 100 34 19 21 20 21 12 1
April 19, 2012............................ 100 29 19 21 20 21 7 1
April 19, 2013............................ 100 24 19 21 20 21 4 0
April 19, 2014............................ 100 20 19 21 20 21 3 0
April 19, 2015............................ 95 20 19 21 20 17 2 0
April 19, 2016............................ 84 20 19 21 20 11 1 0
April 19, 2017............................ 73 20 19 21 14 7 0 0
April 19, 2018............................ 60 20 19 16 9 5 0 0
April 19, 2019............................ 47 20 19 10 5 3 0 0
April 19, 2020............................ 33 20 19 6 3 1 0 0
April 19, 2021............................ 19 20 10 3 1 1 0 0
April 19, 2022............................ 19 5 1 0 0 0 0 0
April 19, 2023............................ 0 0 0 0 0 0 0 0
Weighted Average Life(2)--
To Maturity (Years)..................... 20.737 12.661 10.214 8.809 8.040 7.531 5.919 5.094
To Call (Years)......................... 20.504 11.061 8.092 6.375 5.668 5.237 3.936 3.132
</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 three decimal places.
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<PAGE>
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 19, 2029, 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 19, 2029, 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 Offered Notes will be made by the Principal Paying Agent on
each Payment Date to persons in whose names the Notes are registered as of the
related Record Date (the "Holders" or "Offered 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 Offered 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; (2) in relation to US$ payments under a Currency Swap, any day, other than
a Saturday, Sunday or public holiday, on which banks are open for business in
London and New York City; and (3) in relation to A$ payments under the Currency
Swap and 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 last
Collection Period is the period from the last day of the previous Collection
Period to the Termination Date of the Trust.
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.
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 first Interest Determination Date,
which relates to the Interest Period beginning July 20, 1998, is July 16, 1998.
The "Collection
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<PAGE>
Determination Date" is four Business Days prior to each Payment Date with the
exception of the first Collection Determination Date, which will be July 9,
1998.
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, 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. 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 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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<PAGE>
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 or less than F-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, P-1 or better from Moody's and F-1 or better from
Fitch.
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 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 Swaps);
(3) any amount received by or on behalf of the Issuer Trustee under any
Support Facility (other than the Currency Swaps), including under a Mortgage
Insurance Policy, which the Trust Manager determines should be accounted for
to reduce 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,
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excluding
(8) any interest credited to a Collateral Account for a Support
Facility; and
(9) any amount received by the Issuer Trustee on entry into a
replacement Currency Swaps 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) Liquidation Proceeds received on account of interest;
(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 an
introductory 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 (as defined herein) for that Collection Period. With respect
to any Housing Loan, a "Prepayment Benefit Shortfall" means, in relation to a
Collection Period,
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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 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 "--Distribution of Total Available Funds") 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
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(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.
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 Swaps);
(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 set forth in the Currency
Swaps) 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 365 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 set forth in the Currency Swaps);
(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 365 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
Swaps), PARI PASSU, 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,
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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) PARI PASSU, 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;
(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 fees payable to the Principal Paying Agent, the Agent Bank and
any other agents under the Agency Agreement;
(8) PARI PASSU 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 and a Paying Agent and any other agents or the Agent Bank in
relation to the Trust under the Transaction Documents, for that Collection
Period; and
(9) PARI PASSU 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.
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.
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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:
(1) to reimburse Principal Charge Offs for that Collection Period;
(2) PARI PASSU and rateably, 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;
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(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
confirmations 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. The Issuer Trustee does not
intend and is not permitted to accumulate any surpluses.
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 from or
on behalf of Borrowers 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) Liquidation Proceeds received on account of principal;
(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;
(3) all amounts received by or on behalf of the Issuer Trustee during
that Collection Period under any Support Facility (other than the Currency
Swaps) which the Trust Manager determines should be accounted for to reduce
a Principal Loss;
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(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 Swaps.
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;
(2) to repay any Principal Outstanding under the Redraw Facility;
(3) to allocate to Total Available Funds any Principal Draw; and
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(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, PARI PASSU and rateably, based on their respective
entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmations relating to the Class A Notes of an amount
equal to the lesser of:
(a) the Class A Forex Percentage of the sum of: (1) the Class A
Percentage of Net Principal Collections; and (2) 50% of the Class B
Percentage of Net Principal Collections; and
(b) the A$ 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$, to the Currency Swap
Providers under the swap confirmations relating to the Class B Notes of an
amount equal to 50% of the Class B Percentage of Net Principal Collections.
The "Serial Method 1 Distribution Test" is met if, on any Collection
Determination Date the following conditions are all satisfied:
(i) the Subordinated Percentage at the previous Collection
Determination Date was greater than or equal to twice the Initial
Subordinated Percentage;
(ii) that Collection Determination Date occurs on or before April 19,
2001;
(iii) the fraction, expressed as a percentage, the numerator of which
is the Total Invested Amount on such Collection Determination Date and
the denominator of which is the Total Initial Invested Amount, is greater
than or equal to 10%; and
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(iv) the Average Quarterly Percentage on such Collection
Determination Date:
(a) does not exceed <#>2%</#> and the Total Carryover Charge Off
on that Collection Determination Date does not exceed 30% of the
Class B Initial Invested Amount; or
(b) does not exceed 4% and the Total Carryover Charge Off on such
Collection Determination Date does not exceed 10% of the Class B
Initial Invested Amount; and
(v) the Stated Amount of the Class B Notes on such Collection
Determination Date exceeds 0.25% of the sum of the Class A Initial
Invested Amount and the Class B Initial Invested Amount.
SERIAL METHOD 2
If, on the related Collection Determination Date, the Serial Method 2
Distribution Test has been met, then the Issuer Trustee will pay out of any Net
Principal Collections, on the immediately following Payment Date the following
amounts in the following order of priority:
(1) first, PARI PASSU and rateably, based on their respective
entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmations 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$, to the Currency Swap
Providers under the swap confirmations relating to the Class B Notes of an
amount equal to the Class B Percentage of Net Principal Collections.
The "Serial Method 2 Distribution Test" is met if, on any Collection
Determination Date the following conditions are all satisfied:
(i) the Subordinated Percentage at the previous Collection
Determination Date was greater than or equal to twice the Initial
Subordinated Percentage;
(ii) that Collection Determination Date occurs after April 19, 2001;
(iii) the fraction, expressed as a percentage, the numerator of which
is the Total Invested Amount on such Collection Determination Date and
the denominator of which is the Total Initial Invested Amount, is greater
than or equal to 10%;
(iv) the Average Quarterly Percentage as at the Collection
Determination Date:
(a) does not exceed <#>2%</#> and the Total Carryover Charge Off
on that Collection Determination Date does not exceed 30% of the
Class B Initial Invested Amount; or
(b) does not exceed 4% and the Total Carryover Charge Off on that
Collection Determination Date does not exceed 10% of the Class B
Initial Invested Amount; and
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(v) the Stated Amount of the Class B Notes on such Collection
Determination Date exceeds 0.25% of the sum of (x) the Class A Initial
Invested Amount, (y) the Class B Initial Invested Amount and (z) the US$
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, PARI PASSU and rateably, based on their respective
entitlements:
(i) as a payment, denominated in A$, to the Currency Swap Providers
under the swap confirmations relating to the Class A Notes of an amount
equal to the lesser of:
(a) the Class A Forex Percentage of the Net Principal
Collections; and
(b) the A$ 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$, to the Currency Swap
Providers under the swap confirmations relating to the Class B Notes of an
amount equal to the lesser of (i) the amount remaining after all
distributions in (1) above and (ii) the A$ 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, the A$ Equivalent of 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 Stated Amounts, the A$ Equivalent of
the Class B Stated Amounts and the Redraw Limit calculated as at the preceding
Collection Determination Date.
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The "Initial Subordinated Percentage" shall be 2.2%.
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, 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 Class A Stated Amounts and the Class B Stated Amounts at that
time, (ii) the Redraw Limit at that time, (iii) the aggregate of the RFS Stated
Amounts at that time, and (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 PARI PASSU and rateably,
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 zero (a "Redraw Facility Charge Off") (using A$ Equivalent
amounts in the case of the Class A Notes).
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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, PARI
PASSU and rateably 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 Swaps 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 Swaps 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 a feature 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"). Under 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 under
"--Principal Collections" herein, second, from drawings under the Redraw
Facility and third, from the proceeds of the issuance of RFSs, 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 the 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$30,000,000. 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 delivering 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 the date of 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, the 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
(b) the relevant corporation to enter 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
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(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 (4)
(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 by the Security Trustee of its rights
under the Security Trust Deed after the occurrence of an Event of Default;
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;
(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.
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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 will 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." Such RFS Class A Note will:
(1) have an Initial Invested Amount equal to the RFS Initial Invested
Amount of the converted 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 the 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 Swaps.
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, denominated in Australian dollars and
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.
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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.
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 RFSS
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 location of the
properties securing the Housing Loan and the substituted housing loan. In
addition, the Unpaid Balance of all housing loans acquired by the Trust must be
less than the Unpaid Balance of the Housing Loans transferred to the WST
warehouse trust. The Trust Manager may not substitute a housing loan 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 the Substitution Net
Transfer Amount (Principal) and Substitution Net Transfer Amount (Income) with
respect to such Housing Loan.
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
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Amount of such Offered Note to zero. After the date on which an Offered 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 Offered
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
Offered 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 75% of the votes of all 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. 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 the Paying Agent (as the case may be) shall make such
payment after such withholding or deduction has been made, it shall account
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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 by reason 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, the Issuer Trustee must, when so
directed by the Trust Manager (at any time 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)
upon 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 holders of 75% of the aggregate
Invested Amount of such Class, at their Stated Amount), together with accrued
interest to the date of redemption on any subsequent Payment Date, provided that
the holders of 75% of the aggregate Invested Amount of such Class may 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. All amounts ranking prior to or PARI PASSU with respect to a Class of
Notes must be redeemed concurrently with such Class. Thus the Class B Notes may
not be redeemed unless the Class A Notes are also redeemed.
TERMINATION OF THE TRUST
TERMINATION EVENTS
The Trust shall continue until, and shall terminate on the later of: (i) its
respective Termination Date; (ii) the date on which the Trust Assets have been
sold or realized upon (which such sale shall be completed within 180 days after
the Termination Date of the Trust so far as reasonably practicable and
reasonably commercially viable); and (iii) the date on which the Issuer Trustee
ceases to hold any Housing Loans or Mortgages in relation to the Trust.
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 the holders of 75% of the
aggregate Invested Amount of the relevant Class of Notes. The Servicer will
determine whether a Housing Loan is performing or non-performing.
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
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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 the holders of 75% of the
votes of all 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 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 or 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 S&P, Moody's and Fitch, respectively; 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 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. No Authorized
Investment may have a maturity which is later than the Maturity Date of the
outstanding Notes.
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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, deliver to the
Principal Paying Agent on behalf of the Issuer Trustee, a report (the
"Noteholder's Report") containing the following information:
(i) the Invested Amount and the Stated Amount of each Class of Notes;
(ii) the Interest Payments and principal distributions on each Class of
Notes;
(iii) the Available Income;
(iv) the Total Available Funds;
(v) the aggregate of all Redraws made during that Collection Period;
(vi) the Redraw Shortfall;
(vii) the Subordinated Percentage;
(viii) the Initial Subordinated Percentage;
(ix) the Payment Shortfall (if any);
(x) 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;
(xi) the Gross Principal Collections;
(xii) the Principal Collections;
(xiii) the Liquidity Shortfall (if any);
(xiv) the Remaining Liquidity Shortfall (if any);
(xv) the Principal Charge Off (if any);
(xvi) the Class A Percentage and the Class B Percentage;
(xvii) 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 (The "Bond Factor"
with respect to a Class of Notes is the Initial Invested Amount of such
Class less all principal payments on such Class divided by the Initial
Invested Amount of such Class);
(xxviii) 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);
(xix) all Carryover Charge Offs (if any);
(xx) if required, the Threshold Rate at that Collection Determination
Date;
(xxi) the Quarterly Percentage;
(xxii) LIBOR, as at the first day of the related Interest Period ending
immediately after that Collection Determination Date as calculated by the
Agent Bank;
(xxiii) scheduled and unscheduled payments of principal on the Housing
Loans;
(xxiv) aggregate Balances Outstanding of Fixed Rate Housing Loans and
aggregate Balances Outstanding of Variable Rate Housing Loans; and
(xxv) delinquency statistics with respect to the Housing Loans.
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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.
The Trust Manager will, on or promptly after each Notice Date, prepare and
arrange for the publication on Reuters Screen page WST/SEC9 to WST/SEC10 of
summary pool performance data for the Trust in a format as determined by the
Trust Manager.
BOOK-ENTRY REGISTRATION
Each Class of the Offered Notes will be represented by one or more
book-entry Notes (the "Book-Entry Notes"). Persons acquiring beneficial
ownership interests in the Offered 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 the Offered 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,
N.A. will act as depositary for Cedel, and Morgan Guaranty Trust Company of New
York 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 considered holders of the Offered Notes in relation to the Master Trust
Deed. Note Owners are only permitted to exercise their rights indirectly through
participants and DTC.
The Note 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") 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 Offered Notes from the Issuer Trustee through DTC and DTC
Participants. While the Offered 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 Offered Notes and is required to receive and transmit
distributions of principal of, and interest on, the Offered Notes. Participants
and indirect participants with whom Note Owners have accounts with respect to
Offered 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 (i.e., Definitive Notes) in the Offered
Notes, except under the limited circumstances described
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below. Unless and until Definitive Notes are issued, Note Owners who are not
Participants may transfer ownership of Offered Notes only through Participants
and indirect participants by instructing such Participants and indirect
participants to transfer Offered 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 Offered 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.
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
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.
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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 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 Principal Paying Agent 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 Principal Paying Agent to Cede & Co. Distributions with respect
to the Offered 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. 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 Offered Notes in the secondary
market since certain potential investors may be unwilling to purchase the
Offered Notes for which they cannot obtain physical certificates.
Quarterly 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.
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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 Note 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 an Offered 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 Offered Notes which
conflict with actions taken with respect to other Offered Notes.
Although DTC, Cedel and Euroclear have agreed to the foregoing procedures in
order to facilitate transfers of Offered 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 Note 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 Offered Notes of each Class will be issued in definitive 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 Trust Manager advises the
Principal Paying Agent in writing that the Depository is no longer willing or
able to discharge properly its responsibilities as Depository with respect to
the Offered Notes of such Class, or the Depository or its successor ceases to
carry on business and the Trust Manager is unable to locate a qualified
successor, (ii) the Issuer Trustee, at the direction of the Trust Manager
advises the Principal Paying Agent in writing that the book-entry system through
the Depository is or is to be terminated or (iii) an Event of Default has
occurred, and Note Owners representing not less than a majority of the aggregate
Invested Amount of such Class advise the Principal Paying Agent and the Issuer
Trustee through the Participants and the Depository 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. Upon surrender by
the Depository of the definitive certificate representing the Offered Notes of
the affected Class and instructions for registration, the Trustee will issue the
Offered Notes of such Class as Definitive Notes, and thereafter the Trustee will
recognize the Note Owners of such Definitive Notes as Offered Noteholders under
the Transaction Documents.
Distributions of principal and interest on the Offered Notes will be made by
the Principal Paying Agent directly to Offered Noteholders in accordance with
the procedures set forth herein and in the Master Trust Deed, Series Notice, the
Note Trust Deed and Agency Agreement. Interest payments and any principal
payments on each Payment Date will be made to Offered 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 Principal Paying
Agent. The final payment, on any Offered 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 Offered Noteholders. The Trustee will provide
such notice to registered Noteholders.
Definitive Notes will be transferable and exchangeable at the offices of the
transfer agent and registrar, which initially will be the Principal Paying Agent
(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
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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, SERIES NOTICE AND THE NOTE TRUST DEED WITHOUT
NOTEHOLDER CONSENT
The Issuer Trustee, the Trust Manager, the Servicer (with respect to the
Master Trust Deed and the Series Notice) and the Note Trustee (with respect to
the Note Trust Deed) may by way of supplemental deed alter, add to or modify the
Master Trust Deed, the Series Notice and the Note Trust Deed so long as such
alteration, addition or modification was effected upon consent of the
Noteholders or Beneficiaries (see "--Modification of Master Trust Deed, Series
Notice and the Note 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 law or regulation or
with the requirements of any Australian governmental agency;
(c) appropriate or expedient as a consequence of an amendment to any law
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
(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, SERIES NOTICE AND THE NOTE 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, the Series Notice and the
Note Trust Deed (except an alteration, addition or modification referred to in
"--Modification of Master Trust Deed, Series Notice and the Note 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 holders of 75% of the aggregate Invested
Amount of the Notes, the Class A Notes or the Class B Notes (as the case may be)
or with the prior written consent of the Beneficiaries (as the case may be).
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MEETINGS OF VOTING MORTGAGEES
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.
VOTING OF CLASS A NOTEHOLDERS; MODIFICATION; CONSENTS; WAIVER
The Note Trust Deed contains provisions for the Class A Noteholders to
consider any matter affecting their interests. In general, the holders of a
majority of the aggregate Invested Amount of the Class A Notes may take or
consent to any action permitted to be taken by Class A Noteholders under the
Note Trust Deed. Notwithstanding the foregoing, the consent of holders of 75% of
the aggregate Invested Amount of the Class A Notes shall be required to (i)
direct the Note Trustee to direct the Security Trustee to enforce the security
under the Note Trust Deed, (ii) override any waiver by the Note Trustee of a
breach of any provisions of the Transaction Documents or an Event of Default,
(iii) alter, add, or modify the terms and conditions of the Class A Notes or the
provisions of any of the Transaction Documents if such alteration, addition or
modification is, in the opinion of the Note Trustee, materially prejudicial or
likely to be materially prejudicial to the Offered Noteholders as a whole or the
Class A Noteholders, which shall include any modification to 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
percentage of the aggregate Invested Amount required to consent to any action 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"). 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 that would be materially
prejudicial to the interests of the Class A Noteholders. Except in certain
circumstances, the Note Trust Deed imposes no such limitations on the powers of
the Class A Noteholders, the exercise of which will be binding on the Class B
Noteholders, irrespective of the effect on the Class B Noteholders' interests.
Any action taken by the requisite percentage of the Invested Amount of the Class
A Noteholders shall be binding on all Class A Noteholders (both present and
future).
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 or necessary to comply with any law or regulation. 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,
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any such modification shall be notified to the Class A Noteholders as specified
in the Transaction Documents as soon as practicable thereafter.
VOTING OF CLASS B NOTEHOLDERS; MODIFICATIONS; CONSENTS; WAIVER
The Note Trust Deed contains provisions for the Class B Noteholders to
consider any matter affecting their interests. In general, the holders of a
majority of the aggregate Invested Amount of the Class B Notes may take or
consent to any action permitted to be taken by Class B Noteholders under the
Note Trust Deed. Notwithstanding the foregoing, the consent of holders of 75% of
the aggregate Invested Amount of the Class B Notes shall be required to (i)
direct the Note Trustee to direct the Security Trustee to enforce the security
under the Note Trust Deed, (ii) override any waiver by the Note Trustee of a
breach of any provisions of the Transaction Documents or an Event of Default,
(iii) alter, add, or modify the terms and conditions of the Class B Notes or the
provisions of any of the Transaction Documents if such alteration, addition or
modification is, in the opinion of the Note Trustee, materially prejudicial or
likely to be materially prejudicial to the Offered Noteholders as a whole or the
Class B Noteholders, which shall include any modification to 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
percentage of the aggregate Invested Amount required to consent to any action 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"). 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 that would be materially
prejudicial to the interests of the Class A Noteholders. Except in certain
circumstances, the Note Trust Deed imposes no such limitations on the powers of
the Class A Noteholders, the exercise of which will be binding on the Class B
Noteholders, irrespective of the effect on their interests. Any action taken by
the requisite percentage of Invested Amount of the Class B Noteholders shall be
binding on all Class B Noteholders (both present and future).
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 or necessary to comply with any law or regulation. 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
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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 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 Offered 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.
If an Event of Default occurs and is continuing, the Note Trustee shall
deliver to each Offered Noteholder notice of such Event of Default within 90
days of the date that the Note Trustee became aware of such Event of Default,
provided that, except in the case of a default in payment of Interest and
principal on the Offered Notes, the Note Trustee may withhold such notice if and
so long as it determines in good faith that withholding the notice is in the
interests of the Offered Noteholders.
ENFORCEMENT OF THE SECURITY TRUST DEED
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.
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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.
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
Offered 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 Offered
Noteholders under the Note Trust Deed and the Security Trust Deed; and (ii) each
other Mortgagee under the Security Trust Deed (other than the Offered
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.
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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 (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). The Class B Notes are subject to
similar constraints.
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 an Offered Note, is entitled
to proceed directly against the Issuer Trustee to enforce the performance of any
of the provisions of the Security Trust Deed or the Offered Notes (including the
Conditions).
The rights, remedies and discretion of the Class A Noteholders and the Class
B 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 or the Class B Noteholders, as applicable, 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
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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.
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 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.
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(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.
ANNUAL COMPLIANCE STATEMENT
The Trustee will deliver to the Note Trustee annually a written statement as
to the fulfillment of its obligations under the Transaction Documents.
THE NOTE TRUSTEE
Morgan Guaranty Trust Company of New York, London Branch, will be the Note
Trustee. The Note Trustee may resign after giving three months written notice,
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 75% of the aggregate Invested Amount of the
Class A Notes or the Class B Notes, as appropriate, require the Issuer Trustee
to remove the Note Trustee. In such circumstances and others set forth in the
Master Trust Deed, the Issuer Trustee will be obligated to appoint a successor
note trustee. Any resignation or removal of the Note Trustee and appointment of
a successor note trustee will not become effective until acceptance of the
appointment by a successor note trustee and confirmation by the Rating Agencies
that such appointment will not cause a downgrading, qualification or withdrawal
of the then current ratings of the Offered Notes.
The Note Trustee shall, with respect to all the powers, trusts, authorities,
duties and discretions vested in it by the Transaction Documents, except where
expressly provided otherwise, have regard to the interests of the Class A
Noteholders and the Class B Noteholders subject to the proviso in the following
sentence. If the Note Trustee is required by the Transaction Documents or
Offered Notes to have regard to the interests of the Class A Noteholders and the
Class B Noteholders and where, in the opinion of the Note Trustee, there is a
conflict between the interests of the Class A Noteholders and the interests of
the Class B Noteholders, the Note Trustee shall have regard only to the
interests of the Class A Noteholders despite anything to the contrary in the
Transaction Documents. In such an event, the Class B Noteholders shall have no
claim against the Note Trustee for doing so.
GOVERNING LAW
The Notes and the Transaction Documents (other than the Security Trust Deed
and certain of the swap agreements) 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.
LONDON STOCK EXCHANGE LISTING
For purposes of the listing of the Offered Notes on the London Stock
Exchange, attached hereto as Annex II and Annex III are the terms and conditions
of the Class A Notes and Class B Notes, respectively.
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
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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;
(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.
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(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 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 allow the creation or existence of any other security interest
in the Mortgaged Property unless priority arrangements are entered into with
such third party under which the third party acknowledges that the Housing
Loan and the Mortgage ranks ahead in priority to the third party's 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.
(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 the Servicing
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 and records 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
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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, it will 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
which would rank before or PARI PASSU with the relevant Housing Loan and
Mortgage or allow the creation or existence of any other security interest
in the Mortgaged Property unless priority arrangements are entered into with
such third party under which the third party acknowledges that the Housing
Loan and the Mortgage ranks ahead in priority to the third party's 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.
(6) It will not, except as required by law, release a Borrower from any
amount owing in respect of a Housing Loan or otherwise vary or discharge any
Housing Loan or Mortgage or enter into any 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 release any Housing Loan or Mortgage, reduce the amount
outstanding under or vary the terms of any Housing Loan or grant other
relief to a Borrower, 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 a
Borrower to borrow further moneys under or in relation to a Housing Loan or
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
Servicing 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.
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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
(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.
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
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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;
(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
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(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$56,000,000;
(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.
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
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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 or
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 (or such longer period as the
Rating Agencies agree) 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+ from Standard & Poor's, P-1
from Moody's and F-1+ from Fitch, 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 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.
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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 to the Liquidity Facility
Provider 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 of the Liquidity Limit 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
Offered 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"). Each swap will be
governed by an ISDA Master Agreement, as amended by a supplementary schedule and
confirmed by a written confirmation. All such documents will be governed by the
laws of the state of New South Wales. 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
interest rates on Housing Loans with a variable rate 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 on Housing Loans that have converted to a
Fixed Rate since the Cut-Off Date 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 on Housing Loans that are 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 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
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(2) arrange for a suitably rated counterparty to intermediate the swap
or act as substitute swap provider.
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 Offered 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, respectively, 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 documents 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).
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DESCRIPTION OF CURRENCY SWAPS
The following sections contain a summary of the material terms of the
Currency Swaps, which the Issuer Trustee will enter into with Morgan Guaranty
Trust Company of New York, acting through its London Branch ("Morgan Guaranty")
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 subject to the provisions of the Currency Swaps. The
Currency Swaps are provided on a "joint and several" basis by Westpac and Morgan
Guaranty Trust Company of New York, acting through its London Branch. See
"--Cross Support."
Collections in relation to the Housing Loans and related Mortgages and under
the Variable Rate Basis Swap and the Fixed Rate Basis Swaps will be denominated
in Australian dollars. However, the payment obligations of the Issuer Trustee in
relation to Interest and principal on the Offered Notes are denominated in
United States dollars. To hedge its currency exposure, the Issuer Trustee will
enter into four distinct swap transactions, relating to the Class A Notes and
the Class B Notes, respectively (together, the "Currency Swaps") with the
Currency Swap Providers. The Currency Swaps will be governed by an ISDA Master
Agreement dated , 1998, by and between the Issuer Trustee and Morgan
Guaranty (governed by English law) and an ISDA Master Agreement dated
, 1998, by and between the Issuer Trustee and Westpac (governed by
Australian law) respectively. Each ISDA Master Agreement will be amended by a
schedule thereto. Each swap transaction will be confirmed by a written
confirmation (such ISDA Master Agreements, the schedules thereto and the related
swap confirmations, the "Currency Swaps").
Under the Currency Swaps, the Issuer Trustee is required to pay to the
Currency Swap Providers on each Payment Date amounts in A$ equal to a certain
percentage of the amount of any Principal Collections to be paid to the Class A
and Class B Noteholders received by the Issuer Trustee (the percentage being
that which is described in the section entitled "DESCRIPTION OF THE OFFERED
NOTES--Payments of Principal on the Notes") 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 related swap confirmations). In addition, under the Currency Swaps 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 Offered Noteholders. If on any Payment Date, the Issuer Trustee does not or
is unable to 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 Offered 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
Swaps, 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.
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
Offered 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 Series Notice requires that the Issuer Trustee direct the Currency Swap
Providers to pay all US$ amounts to the Principal Paying Agent or the US$
Account. All US$ amounts shall be paid to the Offered 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 SWAPS BY THE CURRENCY SWAP PROVIDERS
Under the Currency Swaps each Currency Swap Provider shall have the right to
terminate its currency swap in the following circumstances:
(1) If the Issuer Trustee fails to make a payment under the Currency
Swap within the 10 Business Days.
(2) If due to change in law it becomes illegal for the Issuer Trustee or
a Currency Swap Provider to make or receive payments or comply with any
other material provision of the Currency Swaps, the Currency Swap requires
such party to make certain efforts to transfer its rights and obligations to
another office or another affiliate to avoid this illegality (so long as the
transfer would not result in a downgrade of the rating of the Notes). If
those efforts are not successful then the applicable Currency Swap Provider
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 if the Note Trustee is satisfied that the Noteholders will be
paid in full.
(4) An Insolvency Event with respect to the Issuer Trustee occurs.
(5) Any Event of Default occurs and an Extraordinary Resolution of the
Voting Mortgagees is passed directing the Security Trustee to take certain
actions.
TERMINATION OF THE CURRENCY SWAPS BY THE ISSUER TRUSTEE
There are a number of circumstances in which the Issuer Trustee has the
right to terminate the Currency Swaps with respect to a Swap Provider. In each
of these cases it is only permitted to exercise that right 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 10 Business Days 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 Swaps.
(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 Swaps may be
terminated.
(3) If the Issuer Trustee becomes obliged under the Currency Swaps 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) If the Issuer Trustee becomes obliged to make a withholding or
deduction in respect of the Offered Notes and, as a result, the Offered
Notes are redeemed.
The Issuer Trustee (and the Note Trustee) may only terminate the Currency
Swaps following prior consultation by the Note Trustee with the Currency Swap
Providers as to the timing of termination. The Issuer Trustee will exercise such
right to terminate at the direction of the Trust Manager. The Currency Swap
Providers acknowledge that the Trust Manager will perform the day to day
management of the Trust and may exercise or satisfy any of the Issuer Trustee's
rights or obligations under the Currency Swap.
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TERMINATION PAYMENTS
On the Termination Date or the Early Termination Date (each as defined in
the Currency Swaps) in respect of the Currency Swaps, 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 Swaps.
The termination of a Currency Swap is an Event of Default under the Security
Trust Deed. If the Security Trust Deed is enforced after such Events of Default,
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 Swaps will be sufficient to
pay in full amounts owing to the holders of the relevant Notes.
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 SWAPS
If the Currency Swaps are terminated with respect to a Currency Swap
Provider, the Issuer Trustee may (at the direction of the Trust Manager) enter
into one or more currency swaps which replaces the terminated Currency Swap
(other than by way of transfer to avoid termination of the swap) (a "Replacement
Currency Swap") but only on the condition that the Settlement Amount (as defined
in the ISDA Master Agreement) payable (if any) by the Issuer Trustee to the
Currency Swap Provider upon termination of the original Currency Swap will be
paid in full when due in accordance with the Series Notice and 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 premium payable by the provider of the Replacement Currency Swap to be paid
directly to the applicable Currency Swap Provider in satisfaction of and to the
extent of the Issuer Trustee's obligation to pay the termination payment to such
Currency Swap Provider. If such premium paid by the Replacement Swap Provider is
less than the Settlement Amount due to the Currency Swap Provider, the balance
may be satisfied by the Issuer Trustee as a Trust Expense.
DOWNGRADE OF CURRENCY SWAP PROVIDERS
Each Currency Swap Provider, severally, will give a commitment to provide
collateral in respect of the Currency Swap to which it is a party in the event
that the rating that is given to senior debt which is jointly supported by the
two Currency Swap Providers is ever downgraded below a specified level, such
that Moody's would downgrade the rating on the Class A Notes.
CROSS SUPPORT
Each Currency Swap Provider has agreed to pay on demand of the Issuer
Trustee to or at the direction of the Issuer Trustee any amounts that the other
Currency Swap Provider is required to pay pursuant to the relevant Currency Swap
but has failed to pay. So long as a Currency Swap Provider pays such amounts,
the Issuer Trustee shall not be entitled to terminate the relevant Currency Swap
with respect to such default. In any case, a Currency Swap Provider may, in
certain circumstances, elect to replace the defaulting other Currency Swap
Provider with itself or another suitably rated party approved by the Issuer
Trustee, the Trust Manager and the Note Trustee.
CURRENCY SWAP PROVIDERS
Morgan Guaranty Trust Company of New York, acting through its London Branch,
and Westpac are joint providers of the Currency Swaps.
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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.
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 SWAPS.
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 the law of the applicable State or Territory (which laws may differ
substantially between States and Territories) 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
Generally each Housing Loan will be secured by a mortgage which has 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 or if the Housing Loan is not secured by a first ranking mortgage the
Approved Seller will assign to the Issuer Trustee all prior ranking registered
mortgages in relation to that Housing Loan). 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
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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.
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 or leasehold title, interests in which are
created by registration in one or more central land registries 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 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, each proprietor has title to, and may
freely dispose of, their unit. All proprietors are members of a "body
corporate", which is vested with the control, management and administration of
the common property and the strata scheme generally, for the benefit of the
proprietors, including the rules governing the apartment block. Certain parts of
the property, such as the land on which the building is erected, the stairwells,
entrance lobbies and the like are known as "common property" and are held by the
body corporate for the benefit of the 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.
URBAN LEASEHOLD
All land in the Australian Capital Territory is owned by the Commonwealth of
Australia and is subject to a leasehold system of land tenure. Mortgaged
Property in that jurisdiction comprises a Crown lease and developments on the
land subject to that lease. Any such lease:
(a) cannot have a term exceeding 99 years, although the term can be extended
under a straightforward administrative process in which the only
qualification to be considered is whether the land may be required for a
public purpose; and
(b) where they involve residential property are subject to a nominal rent of
5 cents per annum on demand.
As with other Torrens title land, the Borrower's leasehold interest in the
land is entered in a central register and the Borrower may deal with their
leasehold interest (including granting a mortgage over the property) without
consent from the government.
In all cases where Mortgaged Property consists of a leasehold interest, the
unexpired term of the lease exceeds the term of the Housing Loan secured by that
Mortgaged Property.
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Leasehold property may become subject to native title claims. Native title
has only quite recently been recognised by Australian courts. Native title to
particular property is based on the traditional laws and customs of indigenous
Australians and is not necessarily extinguished by grants of Crown leases over
that property. The extent to which native title exists over property (including
property subject to a Crown lease) depends on how that property was previously
used by the indigenous claimants asserting native title, and whether the native
title has been extinguished by the granting of the leasehold interest. If the
lease confers the right of exclusive possession over the property (which is
typically the case with residential leases), the current view is that native
title over the relevant property should be extinguished. Whether a lease confers
exclusive possession will depend on a construction of the lease and the
legislation under which the lease was granted.
Housing Loans secured by Mortgaged Property which is leasehold in the
Australian Capital Territory represents only approximately 1.35% (by value) of
all Housing Loans.
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.
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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. In Australia, a lender may sue to recover all
outstanding principal, interest and fees under the personal covenant of a
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; or
(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
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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 has the 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 either Westpac or, following
a Title Perfection Event, 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 a loss in connection with a breach of the Consumer Credit Legislation
which is caused by a breach of a relevant representation or undertaking.
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,
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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 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.
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USE OF PROCEEDS
The net proceeds from the sale of the Offered Notes will amount to A
$1,600,900 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 Offered 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 the Offered 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 Offered
Notes will be characterized as debt of the Issuer Trustee. Each Noteholder, by
the acceptance of an Offered Note, will agree to treat the Offered 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 the Offered Notes held by it in accordance with such
Noteholder's method of accounting.
SALES OF NOTES
A Noteholder's tax basis in an Offered Note will equal its cost of such
Offered Note, reduced by any amortized premium (as described below) and any
payments other than interest made on such Offered Note and increased by any
market discount or original issue discount included in the Noteholder's income.
A Noteholder that sells an Offered Note will recognize gain or loss (in the
aggregate) in an amount equal to the difference between its adjusted tax basis
in the Offered 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 Offered Note was held as a
capital asset and, if the Offered 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 an Offered Note will be taxed at a maximum rate of
39.6% if the Offered Note is held for not more than 12 months, at 28% if the
Offered Note is held for more than 12 months, but not more than 18 months, and
at 20% if the Offered 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.
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MARKET DISCOUNT
A purchaser of an Offered Note will be considered to have acquired such
Offered Note at a "market discount" to the extent the remaining principal amount
of such Offered Note exceeds the Noteholder's tax basis in such Offered 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
Offered Note.
In the case of a sale or other disposition of an Offered 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 an Offered Note by
gift (and in certain other circumstances), could result in the recognition of
market discount income, computed as if such Offered Note had been sold for its
fair market value.
In the case of a partial principal payment on an Offered 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 Offered 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 Offered 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 an Offered Note subject to the market discount rules exceeds the interest
(including OID) currently includible in income with respect to such Offered
Note, 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 an Offered Note
at a premium to the extent the Noteholder's tax basis in such Offered Note
exceeds the remaining principal amount of such Offered Note. In that event, a
Noteholder who holds an Offered 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
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<PAGE>
the Noteholder's tax basis in the Offered 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 Offered 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 Offered 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 Offered
Notes. 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 OFFERED NOTES. ANY SUCH DEALING WOULD NEED TO COMPLY WITH THE SELLING
RESTRICTIONS AND SECURITIES LAW GENERALLY.
PAYMENTS OF PRINCIPAL, PREMIUMS AND INTEREST
Under existing Australian tax law, non-resident holders of the Offered 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 Treaty, the maximum Australian withholding rate on
interest paid to United States residents who are entitled to the benefit of such
Treaty 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 Offered 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.
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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 a tax discrimination in favour of corporate debt issued in 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 amendment is currently unclear.
PROFIT ON SALE
Under current 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 Offered Notes (but see below for discussion of Australia's capital gains
provisions):
(1) if the profits do not have an Australian source; or
(2) where the profits do have an Australian source, if the holder is
resident in a country with which Australia has entered into a double tax
treaty, is entitled to the benefit of that treaty and the profits are
business profits for the purposes of the treaty which are not
attributable to a business carried on through an Australian
Establishment.
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 Offered 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).
Under provisions for the taxation of capital gains, non-resident holders of
Offered Notes would be subject to Australian tax on profits derived from the
sale or disposal of Offered Notes if the Offered Notes were at any time prior to
the sale or disposal held as part of a business carried on through an Australian
Establishment.
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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
Offered 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 Offered Notes
should be treated as debt without substantial equity features for purposes of
the Plan Assets Regulation and that the Offered Notes do not constitute equity
interests in the Issuer Trustee for purposes of the Plan Assets Regulation.
However, without regard to whether the Offered Notes are treated as an equity
interest for such purposes, the acquisition or holding of the Offered 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 its 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 an Offered 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 an Offered Note, each purchaser shall be deemed to represent and
warrant that its purchase and holding of the Offered 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 OFFERED 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.
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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, "Aaa" by Moody's and "AAA" by Fitch. 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. The Offered Notes are pass-through debt securities. The rating
does not address the expected schedule of principal repayments other than to say
that principal will be returned no later than the final maturity date.
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 the Offered 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............................................
Westpac Banking Corporation..................................................
Deutsche Morgan Grenfell Inc.................................................
Merrill Lynch, Pierce, Fenner & Smith Incorporated...........................
Swiss Bank Corporation.......................................................
---------------- ----------------
Total.................................................................. US$ US$
---------------- ----------------
---------------- ----------------
</TABLE>
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
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Class B Notes, the Underwriters may allow and such dealers may reallow, a
concession not to exceed % of the Class B Principal Balance.
In connection with the offering, the Underwriters may engage in transactions
that stabilize, maintain or otherwise affect the price of the Offered Notes.
Specifically, the Underwriters may overallot the offering, creating a syndicate
short position. In addition, the Underwriters may bid for, and purchase, the
Offered Notes in the open market to cover syndicate shorts or to stabilize the
price of the Offered Notes. Any of these activities may stabilize or maintain
the market price of the Offered Notes 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 Securitisation
Management Pty Limited and Westpac 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 business, certain of the Underwriters and
certain of their affiliates have in the past and may in the future engage in
commercial and investment banking activities with Westpac and its affiliates.
OFFERING RESTRICTIONS
UNITED KINGDOM
Each Underwriter has severally represented and agreed with the Issuer
Trustee that:
(i) it has not offered or sold and will not offer or sell any Offered Notes
to persons in the United Kingdom prior to admission of the Offered Notes to
listing in accordance with Part IV of the Financial Services Act 1986 (the
"Financial Services Act") except to persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments (as principal
or agent) for the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities Regulations
1995 or the Financial Services Act;
(ii) it has complied and will comply with all applicable provisions of the
Financial Services Act with respect to anything done by it in relation to the
Offered Notes in, from or otherwise involving the United Kingdom; and
(iii) it has only issued or passed on and will only issue or pass on in the
United Kingdom any document received by it in connection with the issues of the
Offered Notes, other than any document which consists of or of any part of
listing particulars, supplementary listing particulars or any other document
required or permitted to be published by listing rules under Part IV of the
Financial Services Act, to a person who is of a kind described in Article 11(3)
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1996 (as amended) or is a person to whom the document may otherwise
lawfully be issued or passed on.
AUSTRALIA
The Offered Notes may not, in connection with their initial distribution, be
offered or sold, directly or indirectly, in the Commonwealth of Australia, its
territories or possessions ("Australia"), or to any resident of Australia. Each
Underwriter has severally represented and agreed that in connection with the
initial distribution of the Offered Notes it:
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(i) has not (directly or indirectly) offered for subscription or purchase or
issue invitations to subscribe for or buy nor has it sold, the Offered Notes;
(ii) will not (directly or indirectly) offer for subscription or purchase or
issued invitations to subscribe for or buy nor will it sell the Offered Notes;
and
(iii) has not distributed and will not distribute any offering circular, or
any advertisement or other offering material,
in Australia, its territories or possessions or to any person who is (a)
actually known by the Underwriter (without an obligation on the Underwriter to
make any inquiry) to be a resident of Australia for the purposes of section 128F
of the Tax Act or (b) an associate of Westpac within the meaning of that section
(other than in the capacity of a dealer or underwriter in relation to a
placement of the Offered Notes) as identified on a list provided by Westpac.
LISTING AND GENERAL INFORMATION
LISTING
The listing of the Offered 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 Principal Paying Agent at 60 Victoria Embankment, London EC4Y
0JP, 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):
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(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 dated February 18, 1997 and the Servicing
Agreement Amendment Agreement dated , 1998, each among Westpac,
the Servicer and the Issuer Trustee;
(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 Interest Rate Swaps between the Issuer Trustee and Westpac
dated , 1998;
(ix) the Currency Swap between Westpac, as a Currency Swap Provider and
the Issuer Trustee dated , 1998;
(x) the Currency Swap between Morgan Guaranty & Trust Company, London
Branch as a Currency Swap Provider, and the Issuer Trustee dated ,
1998;
(xi) the Mortgage Pool Insurance Policy between HLIC, Westpac and the
Issuer Trustee;
(xii) the PMI Policies issued by Royal & Sun, MGICA, WLMI and HLIC which
cover individual housing 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.
CONSENTS TO OPINIONS
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 pages 27 and 144 and have authorized the content of
their opinion for the purposes of section 152(1)(e) of the Financial Services
Act 1986.
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 7 and have authorized the content of their opinion
for the purposes of section 152(1)(e) of the Financial Services Act 1986.
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LEGAL MATTERS
Certain legal matters with respect to the Offered Notes will be passed upon
for the Trust Manager and the Issuer Trustee by Mayer, Brown & Platt, Chicago,
Illinois, and for the Trust Manager by 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 Manager by Mayer, Brown & Platt, and certain Australian income tax
consequences will be passed upon for the Trust Manager by Allen Allen & Hemsley.
Certain legal matters with respect to the Note Trustee will be passed upon by
Brown & Wood, a multinational partnership, London, England.
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INDEX OF DEFINED TERMS
<TABLE>
<S> <C>
A$............................................................................ 7
A$ Class A Interest Amount.................................................... 93
A$ Class B Interest Amount.................................................... 93
Accrued Interest Adjustment................................................... 30, 49
ACN........................................................................... 60
ACT........................................................................... 54
Additional Termination Event.................................................. 134
Adverse Effect................................................................ 43, 142
Agent Bank.................................................................... 17
Agreement..................................................................... 136
AMP........................................................................... 83
Approved Bank................................................................. 90
Approved Sellers.............................................................. 13
Australian dollars............................................................ 7
Australian Establishment...................................................... 146
Authorized Investments........................................................ 111
Automatic Early Termination................................................... 134
Availability Fee.............................................................. 105
Available Income.............................................................. 29, 90
Available Liquidity Amount.................................................... 130
Available Redraw Amount....................................................... 104
Average Quarterly Percentage.................................................. 100
Bank Bill Rate................................................................ 104
Basic Terms Modification...................................................... 118, 119
beneficial owner.............................................................. 113
Beneficiary................................................................... 96
Benefit Plan.................................................................. 148
Bond Factor................................................................... 112
Book-Entry Notes.............................................................. 89, 113
Borrower...................................................................... 21
Business Day.................................................................. 16, 88
capital assets................................................................ 144
Carryover Charge Off.......................................................... 30
Carryover Class A Charge Offs................................................. 102
Carryover Class B Charge Offs................................................. 102
Carryover Redraw Charge Offs.................................................. 102
Carryover RFS Class A Charge Offs............................................. 102
CBA........................................................................... 66
Cede.......................................................................... 3
Cedel......................................................................... 1
Cedel Participants............................................................ 114
Certificate of Insurance...................................................... 78
charge........................................................................ 24
Chargor....................................................................... 24, 46
Class......................................................................... 15
Class A Charge Off............................................................ 101
Class A Forex Percentage...................................................... 100
Class A Notes................................................................. 1, 14, 88
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Class A Percentage............................................................ 100
Class B Charge Off............................................................ 101
Class B Notes................................................................. 1, 14, 88
Class B Percentage............................................................ 100
Clean-up Offer................................................................ 25
Closing Date.................................................................. 15
Code.......................................................................... 144
Collateral Account............................................................ 131
Collection Account............................................................ 111
Collection Determination Date................................................. 88
Collection Period............................................................. 88
Collections................................................................... 29, 89
Collections Account........................................................... 22
Commission.................................................................... 3
Concessional Fixed Rate....................................................... 37
Conference Report............................................................. 145
Consumer Credit Legislation................................................... 42, 142
Cooperative................................................................... 115
CPR........................................................................... 84
Currency Swaps................................................................ 135
Currency Swap Providers....................................................... 135
Cut-Off Date.................................................................. 15
Cut-Off Date Balance Outstanding.............................................. 21, 51
Cut-Off Date Pool Balance..................................................... 54
Definitive Note............................................................... 113
Definitive Notes.............................................................. 116
Delinquent.................................................................... 23, 67, 130
Depository.................................................................... 89
Draw Fee...................................................................... 104
DTC........................................................................... 1, 113
Eligibility Criteria.......................................................... 52
Eligible Servicer............................................................. 40
ERISA......................................................................... 148
Euroclear..................................................................... 1
Euroclear Operator............................................................ 115
Euroclear Participants........................................................ 115
European Depositaries......................................................... 113
Event of Default.............................................................. 119
Excess Available Income....................................................... 31, 95
Excess Collections Distribution............................................... 31, 96
Exchange Act.................................................................. 3
Extraordinary Resolution...................................................... 47
Fair Market Value............................................................. 25
Finance Charge Collections.................................................... 91
Finance Charge Loss........................................................... 91
Financial Intermediary........................................................ 113
Fitch......................................................................... 27
Fixed Rate.................................................................... 37
Fixed Rate Housing Loans...................................................... 54
floating charge............................................................... 24
GE............................................................................ 82
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GECA.......................................................................... 82
Government.................................................................... 82
Gross Principal Collections................................................... 29, 96
HLIC.......................................................................... 19, 77
Holders....................................................................... 88
Housing Loan Principal........................................................ 25, 100
Housing Loans................................................................. 2
Initial Invested Amount....................................................... 16
Initial Principal Distributions............................................... 98
Initial Subordinated Percentage............................................... 101
Insolvency Event.............................................................. 105
Interest...................................................................... 17, 95, 108
Interest Determination Date................................................... 16, 88, 95
Interest Period............................................................... 16
Interest Rate................................................................. 16, 93
Interest Rate Swap Provider................................................... 133
Invested Amount............................................................... 16, 30
IRS........................................................................... 144
ISDA.......................................................................... 17, 95
ISDA Definitions.............................................................. 17, 95
ISDA Master Agreement......................................................... 24
Issuer Trustee................................................................ 1, 13, 60
Issuer Trustee Fee............................................................ 63
Issuer Trustee's Default...................................................... 63
J.P. Morgan................................................................... 137
Liquidation Loss.............................................................. 30
Liquidation Losses............................................................ 91
Liquidation Proceeds.......................................................... 91
Liquidity Draw................................................................ 130
Liquidity Facility Provider................................................... 23
Liquidity Limit............................................................... 23, 130
Liquidity Shortfall........................................................... 130
LMI........................................................................... 82
London Stock Exchange......................................................... 1
Loss Date..................................................................... 79
LVR........................................................................... 19
Margin........................................................................ 107
Master Trust Deed............................................................. 13
Maturity Date................................................................. 15
MGICA......................................................................... 20, 78
MIP........................................................................... 68
Moody's....................................................................... 27
Morgan Guaranty............................................................... 135, 137
Mortgage Default.............................................................. 79
Mortgagee in Possession....................................................... 68
Mortgage Insurance Policies................................................... 19
Mortgage Insurers............................................................. 20
Mortgage Pool................................................................. 21
Mortgage Pool Insurance Policy................................................ 19, 78
Mortgage Rates................................................................ 22
Mortgage Servicing System..................................................... 22
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Mortgage Shortfall............................................................ 30, 101
Mortgaged Property............................................................ 21
Mortgagees.................................................................... 24, 45
Mortgages..................................................................... 51
MPC........................................................................... 66
Net Principal Collections..................................................... 18, 98
Note Owners................................................................... 113
Note Trust Deed............................................................... 13, 65
Note Trustee.................................................................. 13, 65
Noteholder.................................................................... 113
Notes......................................................................... 15, 88
Notice of Creation of Trust................................................... 44
NSW........................................................................... 54
NT............................................................................ 54
Offered Noteholders........................................................... 16, 88
Offered Notes................................................................. 1, 14, 88
OID........................................................................... 145
P & I......................................................................... 77
Paying Agent.................................................................. 14
Paying Agents................................................................. 14
Payment Date.................................................................. 1, 16
payment holiday............................................................... 76
Payment Shortfall............................................................. 22, 92
Performing Loan............................................................... 23, 130
Plan Assets Regulation........................................................ 148
PMI Policy.................................................................... 19, 82
Prepayment Benefit............................................................ 92
Prepayment Benefit Shortfall.................................................. 91
Prepayment Calculation Adjustment............................................. 97
Prepayment Cost............................................................... 92
Prepayment Cost Surplus....................................................... 91
Principal Charge Off.......................................................... 30, 101
Principal Collections......................................................... 29, 97
23, 29, 31,
Principal Draw................................................................ 92
Principal Loss................................................................ 30, 92
Principal Outstanding......................................................... 104
Principal Paying Agent........................................................ 14
Procedures Manual............................................................. 125
PTCE.......................................................................... 148
QLD........................................................................... 54
Quarter....................................................................... 88
Quarterly Percentage.......................................................... 100
Rating Agencies............................................................... 27, 149
Record Date................................................................... 16
Redraw........................................................................ 36, 75, 103
redraws....................................................................... 15
Redraw Advance................................................................ 104
Redraw Facility Agreement..................................................... 25, 103
Redraw Facility Charge Off.................................................... 101
Redraw Facility Provider...................................................... 18, 103
Redraw Funding Securities..................................................... 15
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Redraw Limit.................................................................. 104
Redraw Shortfall.............................................................. 103
Registered.................................................................... 21
Registration Statement........................................................ 5
Related Security.............................................................. 51
relevant corporation.......................................................... 105
Relevant Date................................................................. 109
Relevant Depositary........................................................... 113
Relevant Document............................................................. 51
Remaining Liquidity Shortfall................................................. 92
Remittance Date............................................................... 90
Replacement Currency Swap..................................................... 137
Representative................................................................ 47
RFS........................................................................... 107
RFS Charge Off................................................................ 101
RFS Class A Charge Off........................................................ 101
RFS Class A Forex Percentage.................................................. 101
RFS Class A Interest.......................................................... 93
RFS Class A Note.............................................................. 107
RFS Class A Notes............................................................. 2, 15
RFS Interest.................................................................. 93
RFS Series.................................................................... 107
RFSs.......................................................................... 2, 15
Royal & Sun................................................................... 20, 78
Rules......................................................................... 113
SA............................................................................ 54
Sale Notice................................................................... 13
Scheduled Payment............................................................. 21
Secured Moneys................................................................ 47
Securities Act................................................................ 5
Securitized Portfolios........................................................ 68
Security Trustee.............................................................. 13, 45
Security Trust Deed........................................................... 14
Security Trustee Fee.......................................................... 49
Seller Trustee................................................................ 14, 45
Serial Method 1 Distribution Test............................................. 30, 98
Serial Method 2 Distribution Test............................................. 30, 99
Series Notice................................................................. 23
Service....................................................................... 144
Servicer...................................................................... 6, 13, 51
Servicer Transfer Event....................................................... 128
Servicer's Security Undertaking............................................... 35
Servicing Agreement........................................................... 13
Servicing Fee................................................................. 128
SMMEA......................................................................... 26, 149
Standard & Poor's............................................................. 27
Stated Amount................................................................. 17, 30
Strata title.................................................................. 139
Subordinated Percentage....................................................... 101
Substitution Net Transfer Amount (Income)..................................... 90
Substitution Net Transfer Amount (Principal).................................. 97
</TABLE>
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Support Facility.............................................................. 24
Swap Agreements............................................................... 24
Swap Providers................................................................ 135
TAS........................................................................... 54
Tax Act....................................................................... 146
Tax Counsel................................................................... 144
Term.......................................................................... 129
Termination Date.............................................................. 106
Terms and Conditions.......................................................... 115
Threshold Rate................................................................ 37, 134
TIN........................................................................... 146
Title Perfection Event........................................................ 34
TMC........................................................................... 13, 66
top up........................................................................ 36
Torrens title................................................................. 138, 139
Total Available Funds......................................................... 90
Total Carryover Charge Off.................................................... 102
Total Payments................................................................ 31, 94
Transaction Documents......................................................... 151
Transfer Agent and Registrar.................................................. 116
Trust......................................................................... 1, 13, 23
Trust Accounts................................................................ 111
Trust Assets.................................................................. 2
Trust Expenses................................................................ 94
Trust Manager................................................................. 2, 13, 70
Trust Manager Fee............................................................. 71
Trust Manager's Default....................................................... 71
Underwriters.................................................................. 149
Unpaid Balance................................................................ 23, 25, 109
U.S. dollars.................................................................. 7
US$........................................................................... 7
US$ Account................................................................... 102
USD-LIBOR-BBA................................................................. 17, 95
USD-LIBOR-Reference Banks..................................................... 17, 95
Variable Rate Housing Loans................................................... 54
Vic........................................................................... 54
Voting Mortgagee.............................................................. 121
WA............................................................................ 54
weighted average life......................................................... 84
Westpac....................................................................... 2, 13, 66
Westpac Group................................................................. 44
Withholding Tax Event......................................................... 26
WLMI.......................................................................... 20, 78
WSML.......................................................................... 70
</TABLE>
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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.
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APPENDIX II--TERMS AND CONDITIONS OF THE CLASS A NOTES
TERMS AND CONDITIONS OF THE CLASS A NOTES
THE FOLLOWING, SUBJECT TO AMENDMENTS, ARE THE TERMS AND CONDITIONS OF THE
CLASS A NOTES, SUBSTANTIALLY AS THEY WILL APPEAR ON THE REVERSE OF THE CLASS A
NOTES. CLASS A NOTES IN DEFINITIVE FORM WILL ONLY BE ISSUED IN CERTAIN
CIRCUMSTANCES. WHILE THE CLASS A NOTES REMAIN IN BOOK-ENTRY FORM, THE SAME TERMS
AND CONDITIONS GOVERN THEM, EXCEPT TO THE EXTENT THAT THEY ARE APPROPRIATE ONLY
TO THE CLASS A NOTES IN DEFINITIVE FORM. FOR A SUMMARY OF THE PROVISIONS
RELATING TO THE CLASS A NOTES IN BOOK-ENTRY FORM, SEE THE SUMMARY AT THE END OF
THIS SECTION.
The issue of US$ Class A Mortgage Backed Floating Rate Notes due 2029
(the "Class A Notes") of Westpac Securities Administration Limited in its
capacity as trustee of the Series 1998-1G WST Trust (the "Trust"), in such
capacity (the "Issuer Trustee") was authorised by resolution[s] of the Board of
Directors of the Issuer Trustee passed on [*]. These Notes, together with
US$ Class B Mortgage Backed Floating Rate Notes due 2029 (the "Class B
Notes" and, together with the Class A Notes, the "Notes") of the Issuer Trustee
are (a) issued subject to a Master Trust Deed (the "Master Trust Deed") dated
14th February 1997 between the Issuer Trustee and The Mortgage Company Pty
Limited, acceded to by Westpac Securitisation Management Pty Limited (the "Trust
Manager"), by a Series Notice (the "Series Notice") dated [*] between (among
others) the Issuer Trustee, Morgan Guaranty Trust Company of New York, London
office (the note trustee for the time being referred to as the "Note Trustee")
as trustee for the holders for the time being of the Class A Notes (the "Class A
Noteholders") and the holders for the time being of the Class B Notes (the
"Class B Noteholders" and together with the Class A Noteholders, the
"Noteholders") and the Trust Manager, and by these terms and conditions (the
"Class A Conditions"); (b) issued subject to a note trust deed dated [*] (the
"Note Trust Deed") between the Issuer Trustee, the Trust Manager and the Note
Trustee; and (c) secured by a Security Trust Deed (the "Security Trust Deed")
dated [*] between the Issuer Trustee, the Trust Manager, the Note Trustee and
Perpetual Trustee Company Limited (ACN 000 001 007) (the security trustee for
the time being referred to as "Security Trustee").
The statements set out below include summaries of, and are subject to the
detailed provisions of the Master Trust Deed, the Series Notice, the Security
Trust Deed and the Note Trust Deed. Certain words and expressions used herein
have the meanings defined in those documents. In accordance with an agency
agreement (the "Agency Agreement") dated [*] between the Issuer Trustee, the
Trust Manager, the Note Trustee and Morgan Guaranty Trust Company of New York,
London office as principal paying agent (the "Principal Paying Agent", which
expression includes its successors as principal paying agent under the Agency
Agreement) and as agent bank (the "Agent Bank", which expression includes its
successors as Agent Bank under the Agency Agreement), and under which further
paying agents may be appointed (together with the Principal Paying Agent, the
"Paying Agents", which expression includes the successors of each paying agent
as such under the Agency Agreement and any additional paying agents appointed),
payments in respect of the Class A Notes will be made by the Paying Agents and
the Agent Bank will make the determinations specified in the Agency Agreement.
The Class A Noteholders will be entitled (directly or indirectly) to the benefit
of, will be bound by, and will be deemed to have notice of, all the provisions
of the Master Trust Deed, the Series Notice, the Security Trust Deed, the Note
Trust Deed and the Servicing Agreement as amended (the "Servicing Agreement
Amendment Agreement") dated [*] and made between the Issuer Trustee, Westpac
Banking Corporation ("Westpac") and The Mortgage Company Pty Limited as Servicer
(together with any substitute or successor, the "Servicer") (together with the
Currency Swap Agreements (as defined below), those documents the "Relevant
Documents" and, together with certain other transaction documents defined as
such in the Series Notice, the "Transaction Documents"). Copies of the
Transaction Documents are available for inspection at the principal office of
the Principal Paying Agent, being at the date hereof 60 Victoria Embankment,
London EC4Y 0JP.
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In connection with the issue of the Class A Notes, the Issuer Trustee has
entered into an ISDA master interest rate and currency exchange agreement dated
[*] with Westpac Banking Corporation (in such capacity, the "Interest Rate Swap
Provider") together with three confirmations relating thereto dated [*] (the
"Variable Rate Basis Swap" and the "Fixed Rate Basis Swap", respectively and,
together, the "Interest Rate Swaps"). The Issuer Trustee has also entered into
ISDA master interest rate and currency exchange agreements dated [*] with each
of Morgan Guaranty Trust Company of New York, London office and Westpac Banking
Corporation (each, in such capacity, a "Currency Swap Provider", and together
with the Interest Rate Swap Provider, the "Swap Providers") together with two
confirmations relating to each such agreement dated [*] in respect of two
distinct swap transactions relating to each of the Class A Notes and the Class B
Notes, respectively (each, a "Currency Swap", and together the "Currency
Swaps").
1. FORM, DENOMINATION AND TITLE
The Class A Notes will be issued in registered form, without interest
coupons, in minimum denominations of US$100,000 and integral multiples thereof.
The Class A Notes will be represented by one or more typewritten fully
registered book-entry notes (each, a "Book-Entry Note" and collectively, the
"Book-Entry Notes") registered in the name of Cede & Co. ("Cede") as nominee of
The Depository Trust Company ("DTC"). Beneficial interests in the Book-Entry
Notes will be shown on, and transfers thereof will be effected only through,
records maintained by DTC and its participants. Morgan Guaranty Trust Company of
New York, Brussels office, as operator of the Euroclear System ("Euroclear") and
Cedel Bank, societe anonyme ("Cedel Bank"), may hold interests in the Book-Entry
Notes on behalf of persons who have accounts with Euroclear and Cedel Bank
through accounts maintained in the names of Euroclear or Cedel Bank, or in the
names of their respective depositories, with DTC.
If the Issuer Trustee is obliged to issue Definitive Notes under clause 3.3
of the Note Trust Deed, interests in the applicable Book-Entry Note will be
transferred to the beneficial owners thereof in the form of Definitive Notes,
without interest coupons, in the denominations set forth above. A Definitive
Note will be issued to each Noteholder in respect of its registered holding or
holdings of Class A Notes against delivery by such Noteholders of a written
order containing instructions and such other information as the Issuer Trustee
and Morgan Guaranty Trust Company of New York, London office acting as note
registrar (the "Note Registrar") may require to complete, execute and deliver
such Definitive Notes. In such circumstances, the Issuer Trustee will cause
sufficient Definitive Notes to be executed and delivered to the Note Registrar
for completion, authentication and dispatch to the relevant Noteholders.
2. STATUS, SECURITY AND RELATIONSHIP BETWEEN THE CLASS A NOTES, THE CLASS B
NOTES, THE RFSS AND THE RFS CLASS A NOTES
The Class A Notes are secured by a first ranking floating charge over all of
the assets of the Trust (which include, among other things, the Loans (as
defined below) and the Mortgages (as defined below) and related securities) (as
more particularly described in the Security Trust Deed) and rank PARI PASSU and
rateably without any preference or priority among themselves.
The Class A Notes are constituted by the Master Trust Deed and the Series
Notice and are secured by the same security as secures the Class B Notes but the
Class A Notes will rank in priority to the Class B Notes in the event of the
security being enforced and in respect of principal and interest (as set out in
Class A Condition 4 and 5).
The proceeds of the issue of the Class A Notes and the Class B Notes are to
be used by the Issuer Trustee to purchase an equitable interest in certain
housing loans (the "Loans") and certain related mortgages (the "Mortgages") from
Westpac or Westpac Securities Administration Limited in its capacity as trustee
of certain other trusts (each a "WST Seller").
In the event that the security for the Class A Notes is enforced and the
proceeds of such enforcement are insufficient, after payment of all other claims
ranking in priority to or PARI PASSU with the Class A Notes
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under the Security Trust Deed, to pay in full all principal and interest and
other amounts whatsoever due in respect of the Class A Notes, then the Class A
Noteholders shall have no further claim against the Issuer Trustee in respect of
any such unpaid amounts.
The net proceeds of realisation of the assets of the Trust may be
insufficient to pay all amounts due to the Noteholders. Save in certain limited
circumstances the other assets of the Issuer Trustee will not be available for
payment of any shortfall arising and all claims in respect of such shortfall
shall be extinguished (see further Class A Condition 15). None of the Servicer,
the Trust Manager, the Seller Trustee, Westpac, the Note Trustee or the Security
Trustee has any obligation to any Noteholder for payment of any amount by the
Issuer Trustee in respect of the Notes.
THE ISSUER TRUSTEE MAY FROM TIME TO TIME ISSUE DEBT SECURITIES ("RFSS")
CONSTITUTED UNDER THE MASTER TRUST DEED AND THE SERIES NOTICE TO FUND AMOUNTS
REDRAWN BY RELEVANT BORROWERS UNDER THE LOANS (UP TO THE SCHEDULED AMORTISED
PRINCIPAL OF THE LOANS) FROM TIME TO TIME ("REDRAWS"). RFSS WILL, ON ISSUE, RANK
PARI PASSU AND PRIOR TO ENFORCEMENT OF THE SECURITY RELATING TO THE RFSS AND THE
CLASS A NOTES RATEABLY WITHOUT ANY PREFERENCE OR PRIORITY WITH THE CLASS A NOTES
IN RELATION TO PAYMENT OF INTEREST, BUT AHEAD OF THE CLASS A NOTES IN RELATION
TO PRINCIPAL. UPON ENFORCEMENT OF THE SECURITY RELATING TO THE RFSS AND THE
CLASS A NOTES, ALL MONEYS OWING TO THE HOLDERS OF THE RFSS AND THE HOLDERS OF
THE CLASS A NOTES WILL (SUBJECT TO AMOUNTS BEING AVAILABLE FOR SUCH PAYMENT) BE
PAID PARI PASSU.
IF, BY THE FIFTH COLLECTION DETERMINATION DATE (AS DEFINED IN CLASS A
CONDITION 5) FOLLOWING THE ISSUE OF AN RFS, THE RFS HAS NOT BEEN REDEEMED, IT
SHALL CONVERT TO AN RFS CLASS A NOTE (EACH, AN "RFS CLASS A NOTE" AND, TOGETHER
THE "RFS CLASS A NOTES"). RFS CLASS A NOTES RANK PARI PASSU AND RATEABLY WITHOUT
PREFERENCE OR PRIORITY WITH CLASS A NOTES IN RELATION TO BOTH INTEREST AND
PRINCIPAL. RFSS AND RFS CLASS A NOTES ARE REGISTERED, AUSTRALIAN-TRADED
INSTRUMENTS DENOMINATED IN AUSTRALIAN DOLLARS ("A$") AND SOLD TO AUSTRALIAN
INVESTORS ONLY AND FOR THE AVOIDANCE OF DOUBT ARE NOT FUNGIBLE WITH THE CLASS A
NOTES.
THE NOTE TRUST DEED CONTAINS PROVISIONS REQUIRING THE NOTE TRUSTEE TO HAVE
REGARD TO THE INTERESTS OF THE CLASS A NOTEHOLDERS AND THE CLASS B NOTEHOLDERS
AS REGARDS ALL THE POWERS, TRUSTS, AUTHORITIES, DUTIES AND DISCRETIONS OF THE
NOTE TRUSTEE (EXCEPT WHERE EXPRESSLY PROVIDED OTHERWISE), BUT REQUIRING THE NOTE
TRUSTEE IN ANY SUCH CASE TO HAVE REGARD ONLY TO THE INTERESTS OF THE CLASS A
NOTEHOLDERS IF, IN THE NOTE TRUSTEE'S OPINION, THERE IS A CONFLICT BETWEEN THE
INTERESTS OF THE CLASS A NOTEHOLDERS AND THE INTERESTS OF THE CLASS B
NOTEHOLDERS.
THE SECURITY TRUST DEED CONTAINS PROVISIONS REQUIRING THE SECURITY TRUSTEE
TO GIVE PRIORITY TO THE INTERESTS OF THE CLASS A NOTEHOLDERS AND THE HOLDERS OF
RFSS (IF ANY) AND RFS CLASS A NOTES (IF ANY), IF THERE IS A CONFLICT BETWEEN THE
INTERESTS OF SUCH NOTEHOLDERS AND ANY OTHER VOTING MORTGAGEE (AS DEFINED BELOW).
3. COVENANTS OF THE ISSUER TRUSTEE
So long as any of the Class A Notes or the Class B Notes remains
outstanding, the Issuer Trustee has made certain covenants for the benefit of
Class A Noteholders and the Class B Noteholders which are set out in the Master
Trust Deed.
These covenants are as follows:
(a) 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.
(b) The Issuer Trustee shall:
(i) act honestly and in good faith in the performance of its duties and in
the exercise of its discretions 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 discretions under the
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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 endeavours 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 authorisations) 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.
(c) 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 asset of the Trust (the "Trust
Assets").
(d) 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.
(e) The Issuer Trustee will open and operate certain bank accounts in
accordance with the Master Trust Deed and the Series Notice.
(f) 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.
(g) The Issuer Trustee shall properly perform the functions which are
necessary for it to perform under all Transaction Documents in respect of the
Trust.
4. INTEREST
(A) PAYMENT DATES
Each Class A Note bears interest on its Invested Amount (as defined below)
from and including 9 June 1998 or such later date as may be agreed between the
Issuer Trustee and the Managers for the issue of the Class A Notes (the "Closing
Date"). Interest in respect of the Class A Notes will be payable quarterly in
arrear on the 19th day falling in July 1998 in respect of the period from (and
including) the Closing Date to (but excluding) that date, and thereafter on each
19 April, 19 July, 19 October and 19 January (each such date a "Payment Date"
and each such three month period beginning on each of 1 April, 1 July, 1 October
and 1 January a "Quarter"). If any Payment Date would otherwise fall on a day
which is not a Business Day (as defined below), it shall be postponed to the
next day which is a Business
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Day (as defined below) unless it would thereby fall into the next calendar month
in which event it shall be brought forward to the immediately preceding Business
Day.
"Business Day" in this Class A Condition 4 and in Class A Conditions 5 and 9
below means any day (London time) other than a Saturday, Sunday or public
holiday on which banks are open for business in Sydney, London and New York
City.
The period beginning on (and including) the Closing Date and ending on (but
excluding) the first Payment Date and each successive period beginning on (and
including) a Payment Date and ending on (but excluding) the next Payment Date is
called an "Interest Period". Interest payable on a Class A Note in respect of
any Interest Period or any other period will be calculated on the basis of the
actual number of days elapsed and a 360 day year.
Interest shall cease to accrue on any Class A Note from (and including):
(i) the date on which the Stated Amount (as defined in Class A Condition
5(a)) of that Class A Note is reduced to zero; or
(ii) if the Stated Amount on the due date for redemption is not zero, the
due date for redemption of the Class A Note, unless, upon due presentation,
payment of principal due is improperly withheld or refused, following which
interest shall continue to accrue on the Invested Amount of the Class A Note at
the rate from time to time applicable to the Class A Notes until the moneys in
respect of that Class A Note have been received by the Note Trustee or the
Principal Paying Agent and notice to that effect is given in accordance with
Class A Condition 12, or the Stated Amount of that Class A Note has been reduced
to zero.
(B) INTEREST RATE
The rate of interest applicable from time to time to the Class A Notes (the
"Interest Rate") will be determined by the Agent Bank on the basis of the
following paragraphs.
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 an 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 US Dollars which appears on the Telerate Page
3750 as of 11am London time, on the Interest Determination Date. If such rate
does not appear on the Telerate Page 3750, the rate for the 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 US Dollars are offered by the Reference Banks (being four major banks in the
London interbank market) at approximately 11.00 am, 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 am, New York City time, on
that Interest Determination Date for loans in US 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 Interest Payment Date.
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The Interest Rate applicable to the Class A Notes for such Interest Period
shall be the aggregate of (i) such Interest Rate or arithmetic mean as
determined by the Agent Bank and (ii) the margin of 0.[*]% applicable to the
Class A Notes.
There is no maximum or minimum Interest Rate.
(C) DETERMINATION OF INTEREST RATE AND CALCULATION OF INTEREST
The Agent Bank will, as soon as practicable after 11.00 am (London time) on
each Interest Determination Date, determine the Interest Rate applicable to, and
calculate the amount of interest payable (the "Interest") for the immediately
succeeding Interest Period. The Interest is calculated by applying the Interest
Rate for the Class A Notes to the Invested Amount (as defined in Class A
Condition 5(a)) of the Class A Note on the first day of the next Interest
Period, multiplying such product by the actual number of days in the relevant
Interest Period and dividing by 360 and rounding the resultant figure down to
the nearest cent (half a cent being rounded upwards). The determination of the
Interest Rate and the Interest by the Agent Bank shall (in the absence of
manifest error) be final and binding upon all parties.
(D) NOTIFICATION AND PUBLICATION OF INTEREST RATE AND INTEREST
The Agent Bank will cause the Interest Rate and the Interest applicable to
each Class A Note for each Interest Period and the relevant Payment Date to be
notified to the Issuer Trustee, the Trust Manager, the Note Trustee, the Paying
Agents, and, for so long as the Class A Notes are listed on the Official List of
the London Stock Exchange Limited (the "London Stock Exchange"), the London
Stock Exchange, and will cause the same to be published in accordance with Class
A Condition 12 on or as soon as possible after the date of commencement of the
relevant Interest Period. The Interest and the relevant Payment Date so
published may subsequently be amended (or appropriate alternative arrangements
made by way of adjustment) without notice in the event of a shortening of the
Interest Period.
(E) DETERMINATION OR CALCULATION BY THE NOTE TRUSTEE
If the Agent Bank at any time for any reason does not determine the Interest
Rate or calculate the Interest for a Class A Note, the Note Trustee shall do so
and each such determination or calculation shall be deemed to have been made by
the Agent Bank. In doing so, the Note Trustee shall apply the foregoing
provisions of this Condition, with any necessary consequential amendments, to
the extent that, in its opinion, it can do so, and, in all other respects it
shall do so in such a manner as it shall deem fair and reasonable in all the
circumstances.
(F) AGENT BANK
The Issuer Trustee will procure that, so long as any of the Class A Notes
remains outstanding, there will at all times be an Agent Bank. The Issuer
Trustee reserves the right at any time to terminate the appointment of the Agent
Bank. Notice of that termination will be given to the Class A Noteholders. If
any person is unable or unwilling to continue to act as the Agent Bank, or if
the appointment of the Agent Bank is terminated, the Issuer Trustee will, with
the approval of the Note Trustee, appoint a successor Agent Bank to act as such
in its place, provided that neither the resignation nor removal of the Agent
Bank shall take effect until a successor approved by the Note Trustee has been
appointed.
5. REDEMPTION AND PURCHASE
(A) MANDATORY REDEMPTION IN PART FROM PRINCIPAL COLLECTIONS AND
APPORTIONMENT OF PRINCIPAL COLLECTIONS BETWEEN THE CLASS A NOTES, THE CLASS B
NOTES, THE RFS CLASS A NOTES AND THE RFSS
The Class A Notes shall be subject to mandatory redemption in part on any
Payment Date if on that date there are any Principal Collections (as defined
below) available to be distributed in relation to such
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Class A Notes. The principal amount so redeemable in respect of each Class A
Note prior to enforcement of the Security Trust Deed (each a "Principal
Payment") on any Payment Date shall be the amount available for payment as set
out in Class A Condition 5(b) on the day which is four Business Days prior to
the Payment Date (the "Collection Determination Date") preceding that Payment
Date multiplied by the Invested Amount of the applicable Class A Note over the
total Invested Amount of all Class A Notes then outstanding (rounded down to the
nearest cent with half a cent being rounded upwards); provided always that no
Principal Payment on a Class A Note on any date may exceed the amount equal to
the Invested Amount of that Class A Note at that date less amounts charged off
as at that date, or to be charged off on the following Payment Date, as
described in Class A Condition 5(c) (that reduced amount being the "Stated
Amount" of that Class A Note).
The "Invested Amount" of a Class A Note is equal to the Initial Invested
Amount (as defined herein) of such Class A Note less all payments previously
made in respect of principal in respect of such Class A Note. The "Initial
Invested Amount" of a Class A Note is its principal balance at the date of its
issuance.
"Principal Collections" means, in respect of a Collection Period (as defined
below) and as applicable on any Collection Determination Date, the aggregate of:
(i) all amounts received by or on behalf of the Issuer Trustee from or on
behalf of borrowers under the Loans during the Collection Period in respect of
principal, in accordance with the terms of the Loans, including principal
prepayments;
(ii) all other amounts received by or on behalf of the Issuer Trustee under
or in respect of principal under the Loans and the Mortgages during that
Collection Period including:
(A) any amounts recovered in respect of enforcement of Loans and Mortgages
(other than under lender's mortgage insurance), on account of principal;
(B) any payments by Westpac to the Issuer Trustee on the repurchase of a
Loan under the Master Trust Deed during that Collection Period which are
attributable to principal;
(C) any payments by Westpac Securities Administration Limited (in its
capacity as trustee of any other trust established under the Master Trust Deed)
(the "WST Purchaser") on the purchase by the WST Purchaser of any assets of the
Trust which are attributable to principal;
(D) any Prepayment Costs (as defined in the Series Notice) applied towards
Prepayment Benefits (as defined in the Series Notice) under the Series Notice;
and
(E) any Prepayment Benefit Shortfall (as defined in the Series Notice) paid
by Westpac to the Trust under the Series Notice;
(iii) all amounts received by or on behalf of the Issuer Trustee during that
Collection Period from any provider of a Support Facility (as defined in the
Series Notice) (other than the Currency Swap) under that Support Facility and
which the Trust Manager determines should be accounted for to reduce any
principal loss on a Loan, being the total amount outstanding under a Loan after
applying all proceeds from the enforcement of the Loan and related Mortgages (a
"Liquidation Loss") to the extent that Liquidation Loss is attributable to
principal;
(iv) all amounts received by or on behalf of the Issuer Trustee during that
Collection Period:
(A) from Westpac or the WST Seller Trustee (each an "Approved Seller") in
respect of any breach of a representation, warranty or undertaking contained in
the Master Trust Deed or the Series Notice;
(B) from an Approved Seller under any obligation under the Master Trust Deed
or the Series Notice to indemnify or reimburse the Issuer Trustee for any
amount;
(C) from the Servicer, in respect of any breach of any representation,
warranty or undertaking contained in the Servicing Agreement; and
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(D) from the Servicer under any obligation under the Servicing Agreement to
indemnify or reimburse the Issuer Trustee for any amount,
in each case, which are determined by the Trust Manager to be in respect of
principal payable under the Loans and the Mortgages;
(v) any amounts in the nature of principal received by or on behalf of the
Issuer Trustee during that Collection Period pursuant to the sale of any asset
comprised in the Trust (including any amount received by the Issuer Trustee on
the issue of Notes and which was not used to purchase Loans or Mortgages, and
which the Trust Manager determines is surplus to the requirements of the Trust);
(vi) (for the purposes of clause 6.11 of the Series Notice only) any amount
of Excess Available Income (as defined in the Series Notice) to be applied to
pay a Principal Charge Off or a Carryover Charge Off (as defined in the Series
Notice);
(vii) 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 dated [*] between
the Issuer Trustee, the Trust Manager and Westpac (the "Redraw Facility");
(viii) any Excess Available Income to be applied to Principal Draws (as
defined in the Series Notice) made on a previous Payment Date;
(ix) any Prepayment Calculation Adjustment (as defined in the Series Notice)
for that Collection Period;
(x) any Substitution Net Transfer Amount (Principal) (as defined in the
Series Notice) received by the Trust from a WST Purchaser with respect to that
Collection Period;
less any amounts deducted by or paid to Westpac to reimburse Redraws funded by
Westpac for which Westpac has not previously been reimbursed. A premium
receivable by the Issuer Trustee on the entry into a replacement Currency Swap
under clause 6.26 of the Series Notice is not treated as a Principal Collection.
"Collection Period" means, in relation to a Payment Date, the period from
(and including) the tenth day of the Quarter preceding the Quarter in which the
Payment Date occurs to (and including) the ninth day of the Quarter in which the
Payment Date occurs. The first Collection Period is the period from (but
excluding) [May 6, 1998] (the "Cut-Off Date") to (and including) July 9, 1998.
The last Collection Period is the period from (but excluding) the last day of
the previous Collection Period to (and including) the termination date of the
Trust.
(B) INITIAL PRINCIPAL DISTRIBUTIONS
Principal Collections will be distributed as follows on each Payment Date
before any payments in respect of the Notes:
(i) first, to repay any Redraws provided by Westpac in relation to Loans to
the extent that Westpac has not previously been reimbursed in relation to those
Redraws;
(ii) second, to repay all principal outstanding under the Redraw Facility on
that Payment Date;
(iii) third, to allocate to Total Available Funds any Principal Draw (as
defined in the Series Notice); and
(iv) fourth, to repay PARI PASSU and rateably all amounts outstanding under
the RFSs (if any).
(C) PRINCIPAL ALLOCATION METHOD
On each Collection Determination Date, the Trust Manager will determine the
A$ Equivalent of the aggregate of the Class B Stated Amounts divided by the sum
of (i) the A$ Equivalent of the Total Stated
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Amount at that time, plus (ii) the Redraw Limit at that time, plus (iii) the
aggregate of the RFS Stated Amount at that time, plus (iv) the aggregate of the
RFS Class A Stated Amounts at that time (the "Subordinated Percentage"). The
Trust Manager will calculate the Subordinated Percentage so as to determine the
appropriate principal distribution methodology to apply for that Collection
Period, as described below.
(D) APPLICABILITY OF SERIAL METHOD 1
If, on any Collection Determination Date:
(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 the third
anniversary of the Closing Date;
(iii) the Total Invested Amount as at that Collection Determination Date as
a percentage of the Total Initial Invested Amount, is greater than or equal to
10%:
(iv) the Average Quarterly Percentage as at that 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 Amounts of all Class B Notes as at that Collection
Determination Date exceeds 0.25% of the aggregate of all Initial Invested
Amounts of all Class A Notes and all Class B Notes as at the Collection
Determination Date;
then Principal Collections will be allocated serially in accordance with Serial
Method I set out in paragraph (e) below.
(E) SERIAL METHOD 1
On any Collection Determination Date, if the Trust Manager determines that
Serial Method 1 should apply, the Issuer Trustee (based on instructions from the
Trust Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions, on the Payment
Date following that Collection Determination Date the following amounts in the
following priority:
(i) first PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the sum of:
(aa) the Class A Percentage of Principal Collections remaining after all
Initial Principal Distributions; and
(bb) 50% of the Class B Percentage of those Principal Collections; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) 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:
(1) the RFS Class A Forex percentage of the sum of:
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(aa) the Class A Percentage of Principal Collections remaining after all
Initial Principal Distributions; and
(bb) 50% of the Class B Percentage of those Principal Collections; and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
(ii) second, as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to 50% of the Class B Percentage of those Principal Collections remaining
after all Initial Principal Distributions.
(F) APPLICABILITY OF SERIAL METHOD 2
If, on any Collection Determination Date:
(i) the Subordinated Percentage at the previous Collection Determination
Date was greater than or equal to twice the Initial Subordinated Percentage;
(ii) that Collection Determination Date occurs after the third anniversary
of the Closing Date;
(iii) the Total Invested Amount as at that Collection Determination Date, as
a percentage of the Total Initial Invested Amount, is greater than or equal to
10%;
(iv) the Average Quarterly Percentage as at the Collection Determination
Date:
(A) does not exceed 2% and the Total Carryover Charge Off on that Collection
Determination Date does not exceed 30% of the Class B Initial Invested Amount;
or
(B) does not exceed 4% and the Total Carryover Charge Off on that Collection
Determination Date does not exceed 10% of the Class B Initial Invested Amount;
and
(v) the Stated Amount of the Class B Notes as at that Collection
Determination Date exceeds 0.25% of the aggregate of all Initial Invested
Amounts of all Class A Notes and all Class B Notes and the US$ Equivalent of the
Invested Amounts of all RFS Class A Notes (if any);
then Principal Collections will be allocated serially in accordance with Serial
Method 2 set out in paragraph (g) below.
(G) SERIAL METHOD 2
On any Collection Determination Date, if the Trust Manager determines that
Serial Method 2 shall apply, the Issuer Trustee (based on instructions from the
Trust Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions on the Payment
Date following that Collection Determination Date in the following amounts in
the following priority:
(i) first, PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the Class A Percentage of Principal
Collections remaining after all Initial Principal Distributions; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) 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:
(1) the RFS Class A Forex Percentage of the Class A Percentage of those
Principal Collections remaining after all Initial Principal Distributions: and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
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(ii) second as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to the Class B Percentage of those Principal Collections.
(H) SEQUENTIAL METHOD
On any Collection Determination Date, if the Trust Manager determines that
neither Serial Method I nor Serial Method 2 (set out in Conditions 5(d) to (g)
above) applies, the Issuer Trustee (based on instructions from the Trust
Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions the following
amounts in the following priority:
(I) FIRST PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the amount available for distribution
under this paragraph (i) after all Initial Principal Distributions; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) as a payment, denominated in A$, to the holders of the RFS Class A Notes
(if any) of an amount equal to the lesser of:
(1) the RFS Class A Forex Percentage of the amount available for
distribution under this paragraph (i) after all Initial Principal Distributions;
and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
(ii) second, as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to the lesser of:
(A) the amount available for distribution under this paragraph (ii) after
the application of paragraph (i); and
(B) the A$ Equivalent of the Class B Stated Amounts for all Class B Notes.
(I) GENERAL
No amount of principal will be paid to a Noteholder in excess of the Stated
Amount applicable to the Notes held by that Noteholder.
(J) DISTRIBUTION OF EXCESS AVAILABLE INCOME
On each Collection Determination Date Excess Available Income for the
Collection Period relating to that Collection Determination Date will be applied
in the following order of priority:
(i) to reimburse Principal Charge Offs for that Collection Period;
(ii) PARI PASSU and rateably between themselves (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):
(A) as a payment to the RFSs (if any) in or towards reinstating the Stated
Amount of the RFSs, to the extent of any Carryover RFS Charge Offs;
(B) as a payment to the RFS Class A Notes (if any) in or towards reinstating
the Stated Amount of the RFS Class A Notes, to the extent of any Carryover RFS
Class A Charge Offs;
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(C) as a payment to the Currency Swap Providers under the relevant swap
confirmations relating to the Class A Notes, of the A$ Equivalent of any
Carryover Class A Charge Offs; and
(D) as a repayment under the Redraw Facility Agreement, as a reduction of,
and to the extent of, any Carryover Redraw Charge Offs;
(iii) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class B Notes of the A$
Equivalent of any Carryover Class B Charge Offs; and
(iv) to all Principal Draws which have not been repaid as at that Payment
Date.
Any amount to be paid pursuant to paragraphs (ii) and (iii) will be paid on
the Payment Date immediately following the Collection Determination Date.
(K) US$ ACCOUNT
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 Swaps into the US$ Account or to the Principal
Paying Agent under the Agency Agreement on behalf of the Issuer Trustee. The
Issuer Trustee shall pay all such amounts as follows, and in accordance with the
Note Trust Deed and the Agency Agreement:
(i) under Class A Condition 4, PARI PASSU in relation to the Class A Notes
as payments of Interest on those Class A Notes;
(ii) under Class A Condition 4, PARI PASSU in relation to the Class B Notes
as payments of Interest on those Class B Notes;
(iii) under Class A Condition 5(j)(ii)(C), PARI PASSU in relation to the
Class A Notes in or towards reinstating the Stated Amount of those Class A
Notes, to the extent of the Carryover Class A Charge Offs;
(iv) under Class A Condition 5(j)(iii), PARI PASSU in relation to Class B
Notes in or towards reinstating the Stated Amount of those Class B Notes, to the
extent of the Carryover Class B Charge Offs;
(v) under Class A Condition 5(e)(i)(A), 5(g)(i)(A) and 5(h)(i)(A) PARI PASSU
in relation to the Class A Notes as Class A Principal Payments until the Class A
Stated Amounts have been reduced to zero; and
(vi) under Class A Condition 5(e)(ii), 5(g)(ii) and 5(h)(ii) PARI PASSU in
relation to the Class B Notes as Class B Principal Payments until the Class B
Stated Amounts have been reduced to zero.
(L) CHARGE OFFS
If the Principal Charge Offs (as defined in the Series Notice) for any
Collection Period exceed the Excess Available Income (as defined in the Series
Notice) calculated on the Collection Determination Date for that Collection
Period, the Trust Manager must, on and with effect from the Payment Date
immediately following the end of the Collection Period:
(i) reduce PARI PASSU the Class B Stated Amount of each of the Class B Notes
by the US$ Equivalent of the amount of that excess which is attributable to each
Class B Note until the Class B Stated Amount is zero; and
(ii) if the Class B Stated Amount is zero and any amount of that excess has
not been applied under paragraph (i), reduce PARI PASSU and rateably as between
themselves (based on the Stated Amount of the RFSs (if any), the Principal
Outstanding under the Redraw Facility, the Stated Amount of the RFS Class A
Notes (if any) and the A$ Equivalent of the Stated Amount of the Class A Notes):
(A) the Class A Stated Amount on each of the Class A Notes by the US$
Equivalent of the balance of that excess which is attributable to each Class A
Note until the Class A Stated Amount of that Class A Note is zero;
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(B) the RFS Class A Stated Amount on each of the RFS Class A Notes (if any)
by the balance of that excess which is attributable to each RFS Class A Note
until the RFS Class A Stated Amount of that RFS Class A Note is zero;
(C) the RFS Stated Amount on each of the RFSs (if any) by the balance of
that excess which is attributable to each RFS until the RFS Stated Amount is
zero: and
(D) the principal outstanding under the Redraw Facility by the balance of
that excess until the Principal Outstanding is zero.
(M) CALCULATION OF PRINCIPAL PAYMENTS, STATED AMOUNT AND BOND FACTOR
(i) On each Collection Determination Date, the Trust Manager shall
determine:
(A) the amount of any Principal Payment in respect of each Class A Note on
the Payment Date following that Collection Determination Date;
(B) the Stated Amount and Invested Amount of each Class A Note as of the
first day of the next following Interest Period (after deducting any Principal
Payment due to be made in respect of each Class A Note on the next Payment Date)
and
(C) the fraction in respect of each Class A Note expressed as a decimal to
the seventh point (the "Bond Factor" of which the numerator is the aggregate of
the Invested Amount of all Class A Notes at that date less all Principal
Payments to be made on the following Payment Date, and the denominator is the
Initial Invested Amount of the Class A Notes.
(ii) The Trust Manager will notify the Note Trustee, the Principal Paying
Agent, the Agent Bank and (for so long as the Class A Notes are listed on the
London Stock Exchange) the London Stock Exchange by not later than the
Collection Determination Date immediately preceding the relevant Payment Date of
each determination of a Principal Payment, Invested Amount, Stated Amount and
Bond Factor and will immediately cause details of each of those determinations
to be published in accordance with Condition 12. If no Principal Payment is due
to be made on the Class A Notes on any Payment Date a notice to this effect will
be given to the Class A Noteholders in accordance with Class A Condition 12.
(iii) If the Trust Manager does not at any time for any reason determine a
Principal Payment, the Invested Amount, the Stated Amount or the Bond Factor
applicable to Class A Notes in accordance with this paragraph, the Principal
Payment, Invested Amount, the Stated Amount and the Bond Factor shall be
determined by the Note Trustee in accordance with this paragraph and paragraph
(i) above (but based on the information in its possession) and each such
determination or calculation shall be deemed to have been made by the Trust
Manager.
(iv) The Trust Manager will deliver to the Principal Paying Agent a
quarterly servicing report as set forth in clause 11 of the Note Trust Deed.
(N) 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 the Class A 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 Loans for a Collection Period ceases to be
receivable (whether or not actually received) by the Issuer Trustee during such
Collection Period by reason 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, the Issuer Trustee must, when so
directed by the Trust Manager (at any time at the Trust Manager's option)
(provided
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that the Issuer Trustee will be in a position on such Payment Date to discharge
(and will so certify to the Issuer Trustee and Note Trustee) all its liabilities
in respect of the Class A Notes and any amounts required under the Security
Trust Deed to be paid in priority to or PARI PASSU with the Class A Notes), upon
having given not more than 60 nor less than 30 days' notice to the Class A
Noteholders in accordance with Class A Condition 12 redeem all, but not some
only, of the Class A Notes at their Invested Amount (or at the option of the
holders of 75% of the aggregate Invested Amount of Class A Notes at the time, at
their Stated Amount), together with accrued interest to the date of redemption
on any subsequent Payment Date, provided that the holders of 75% of the
aggregate Invested Amount of Class A Notes at the time may elect, and shall
notify the Issuer Trustee and the Trust Manager, that they do not require the
Issuer Trustee to redeem the Class A Notes in the circumstances described above.
(O) OPTIONAL REDEMPTION IN WHOLE
On any Payment Date, and upon giving no more than 60 nor less than 30 days'
notice to the Note Trustee and the Security Trustee, on which the aggregate
principal outstanding of the Loans is less than 10% of the aggregate principal
outstanding of the Loans at the Cut-Off Date, the Issuer Trustee may redeem all
(but not some only) of the Class A Notes at their Stated Amount.
(P) REDEMPTION ON MATURITY
If not otherwise redeemed, the Class A Notes will be redeemed at their
Stated Amount on the Payment Date falling in December 2029.
(Q) CANCELLATION
All Class A Notes redeemed in full pursuant to the foregoing provisions will
be cancelled forthwith, and may not be resold or reissued.
(R) CERTIFICATION
For the purposes of any redemption made pursuant to this Condition 5 the
Note Trustee may rely upon an officer's certificate under the Note Trust Deed
from the Trust Manager on behalf of the Issuer Trustee certifying or stating the
opinion of each person signing such certificate as:
(i) to the fair value (within 90 days of such release) of the property or
securities proposed to be released from the Security Trust Deed;
(ii) that in the opinion of such person the proposed release will not impair
the security under the Security Trust Deed in contravention of the provisions of
the Security Trust Deed or the Note Trust Deed;
(iii) that the Issuer Trustee will be in a position to discharge all its
liabilities in respect of the relevant Class A Notes; and
(iv) any amounts required under the Security Trust Deed to be paid in
priority to or PARI PASSU with those Class A Notes,
and such officer's certificate shall be conclusive and binding on the Issuer
Trustee, the Note Trustee and the holders of those Class A Notes.
(S) PURCHASES
The Issuer Trustee may not purchase any Class A Notes at any time.
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6. PAYMENTS
(A) METHOD OF PAYMENT
Any instalment of interest or principal, payable on any Class A Note which
is punctually paid or duly provided for by the Issuer Trustee to the Principal
Paying Agent on the applicable Payment Date or Maturity Date shall be paid to
the person in whose name such Class A Note is registered on the Record Date, by
cheque mailed first-class, postage prepaid, to such person's address as it
appears on the Note Register on such Record Date, except that, unless Definitive
Notes have been issued pursuant to clause 3.3 of the Note Trust Deed, with
respect to Class A Notes registered on the Record Date in the name of the
nominee of DTC (initially, such nominee to be Cede & Co.), payment will be made
by wire transfer in immediately available funds to the account designated by
such nominee and except for the final instalment of principal payable with
respect to such Class A Note on a Payment Date or Maturity Date.
(B) INITIAL PRINCIPAL PAYING AGENT
The initial Principal Paying Agent is Morgan Guaranty Trust Company of New
York, London Branch at its office at 60 Victoria Embankment, London EC4Y 0JP.
(C) PAYING AGENTS
The Issuer Trustee (or the Trust Manager on its behalf after advising the
Issuer Trustee thereof) may at any time (with the previous written approval of
the Note Trustee) vary or terminate the appointment of any Paying Agent and
appoint additional or other Paying Agents, provided that it will at all times
maintain a Paying Agent having a specified office in London and in New York
City. Notice of any such termination or appointment and of any change in the
office through which any Paying Agent will act will be given in accordance with
Class A Condition 12.
(D) DUE DATE FOR REDEMPTION
If the due date for redemption in full of a Class A Note is not a Payment
Date, the interest accrued in respect of the period from the preceding Payment
Date (or from the Closing Date as the case may be) shall be payable only against
presentation or surrender of the relevant Class A Note.
(E) PAYMENTS ON BUSINESS DAYS
If the due date for payment of any amount of principal or Interest in
respect of any Class A Note is not a Business Day then payment will not be made
until the next succeeding Business Day and the holder thereof shall not be
entitled to any further interest or other payment in respect of that delay. In
this Condition 6 the expression "Business Day" means any day (other than a
Saturday, Sunday or a public holiday) on which banks are open for business in
the place where the specified office of the Paying Agent is situated and, in the
case of payment by transfer to a US dollar account, in New York City and prior
to any exchange of the Book-Entry Note (in respect of the Class A Notes) for any
definitive Class A Notes, on which DTC is open for business.
(F) INTEREST
If Interest is not paid in respect of a Class A Note on the date when due
and payable (other than because the due date is not a Business Day), that unpaid
Interest shall itself bear interest at the Interest Rate applicable from time to
time to the Class A Notes until the unpaid interest, and interest on it, is
available for payment and notice of that availability has been duly given in
accordance with Class A Condition 12.
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7. TAXATION
All payments in respect of the Class A Notes will be made without
withholding or 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
Class A Notes subject to any withholding or deduction for, or on account of, any
present or future taxes, duties or charges of whatsoever nature. In that event
the Issuer Trustee or that Paying Agent (as the case may be) shall make such
payment after such withholding or deduction has been made and 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 Class A Noteholders in respect of that withholding or
deduction.
8. PRESCRIPTION
A Class A 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 that Class A Note to
zero. After the date on which a Class A Note becomes void in its entirety, no
claim may be made in respect of it.
As used in these Conditions, 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 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 Class A
Condition 12.
9. EVENTS OF DEFAULT
Each of the following is an "Event of Default":
(a) the Issuer Trustee fails to pay:
(i) 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 or
holders of RFSs or holders of RFS Class A Notes, or
(ii) any other amount owing to Class A Noteholders, Class B Noteholders or
holders of RFSs or 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 Mortgagee or
where the Mortgagee is a Noteholder, with the Note Trustee).
(b) the Issuer Trustee fails to perform or observe any other provisions
(other than an obligation referred to in paragraph (a)) of a Transaction
Document (other than the Underwriting Agreement) where such failure will have a
material and adverse affect 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 to the 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 Offered Notes are 75% of the Secured Money) after written notice from
the Security Trustee requiring the failure to be remedied.
(c) any of the following occurs in relation to the Issuer Trustee (in its
personal capacity or as Trustee of the Trust):
(i) an administrator of the Issuer Trustee is appointed; or
(ii) except for the purpose of a solvent reconstruction or amalgamation:
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(A) an application or an order is made, proceedings are commenced, a
resolution is passed or proposed in a notice of meeting or an application to a
court or other steps (other than frivolous or vexatious applications,
proceedings, notices and steps) are taken for:
(1) the winding up, dissolution or administration of the Issuer Trustee; or
(2) the Issuer Trustee entering into an arrangement, compromise or
composition with or assignment for the benefit of its creditors or a class of
them; or
(B) the Issuer Trustee 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
(iii) the Issuer Trustee 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, where this
occurs in relation to another trust of which it is the trustee):
(iv) a receiver, receiver and manager or administrator is appointed (by the
Issuer Trustee or by any other person) to all or substantially all of the assets
and undertaking of the Issuer Trustee 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
(v) anything analogous to an event referred to in paragraphs (i) to (iv)
(inclusive) or having substantially similar effect, occurs with respect to the
Issuer Trustee;
(d) 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;
(e) any security interest over the Trust Assets is enforced;
(f) all or any part of any Transaction Document, other than the Redraw
Facility or the Basis Swap (each as defined in the Series Notice), 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 Redraw Facility or the Basis Swap);
or
(g) without the prior consent of the Security Trustee (that consent, in
accordance with the provisions of the Security Trust Deed, being subject 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
Relevant Documents, the Issuer Trustee ceases to be authorised under the Trust
to hold the property of the Trust in its name and to perform its obligations
under the Relevant Documents.
IN THE EVENT THAT THE SECURITY CONSTITUTED BY THE SECURITY TRUST DEED
BECOMES ENFORCEABLE FOLLOWING AN EVENT OF DEFAULT UNDER THE NOTES ANY FUNDS
RESULTING FROM THE REALIZATION OF SUCH SECURITY SHALL BE APPLIED IN ACCORDANCE
WITH THE ORDER OF PRIORITY OF PAYMENTS AS STATED IN THE SECURITY TRUST DEED.
10. ENFORCEMENT
(a) At any time after an Event of Default occurs, the Security Trustee may,
with the prior written consent of the Note Trustee in accordance with the
provisions of the Security Trust Deed and shall, if so directed by (a) the Note
Trustee alone, where the Note Trustee is the only Voting Mortgagee, or otherwise
(b) an Extraordinary Resolution (being 75% of votes capable of being cast by
Voting Mortgagees present or in person or by proxy of the relevant meeting or a
written resolution signed by all Voting Mortgagees) of
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the Voting Mortgagees (which includes the Note Trustee on behalf of Noteholders,
but not the Noteholders themselves), declare the Class A Notes immediately due
and payable and enforce the Security Trust Deed. If an Extraordinary Resolution
of Voting Mortgagees referred to in sub-paragraph (b) above elects not to direct
the Security Trustee to enforce the Security Trust Deed, in circumstances where
the Security Trustee could enforce, the Note Trustee may nonetheless, and shall
at the direction of the Class A Noteholders, direct the Security Trustee to
enforce the Security Trust Deed on behalf of the Noteholders.
"Voting Mortgagee" means:
(a) for so long as the amounts outstanding under the Class A Notes and the
Class B Notes are 75% or more of all amounts secured by the Security Trust Deed,
the Note Trustee alone; and
(b) 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 chargees except as provided in the Security Trust Deed.
(b) 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 realised 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
(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).
(c) Neither the Note Trustee nor the Security Trustee will be liable for any
decline in the value, nor any loss realised 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 Class A 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.
(d) 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
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Class A Notes, unless directed or requested to do so by Noteholders holding at
least 75% of the aggregate Invested Amount of Class A Notes or Class B Notes (as
the case may be) at the time; 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.
(e) 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 these Class A Conditions).
(f) The rights, remedies and discretions 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 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 (AS DEFINED IN THE MASTER TRUST DEED) AND PAYABLE
TO THE LIQUIDITY FACILITY PROVIDER (AS DEFINED IN THE MASTER TRUST DEED) AND THE
PROCEEDS OF CASH COLLATERAL LODGED WITH AND PAYABLE TO A SWAP PROVIDER OR OTHER
PROVIDER OF A SUPPORT FACILITY (AS DEFINED IN THE MASTER TRUST DEED)) WILL BE
APPLIED IN THE ORDER OF PRIORITY AS SET OUT IN THE SECURITY TRUST DEED. ANY
CLAIMS OF NOTEHOLDERS REMAINING AFTER REALIZATION OF THE SECURITY AND
APPLICATION OF THE PROCEEDS AS AFORESAID SHALL, EXCEPT IN CERTAIN LIMITED
CIRCUMSTANCES, BE EXTINGUISHED.
11. REPLACEMENTS OF CLASS A NOTES
If any Class A Note is lost, stolen, mutilated, defaced or destroyed, it may
be replaced at the specified office of the Principal Paying Agent upon payment
by the claimant of the expenses incurred in connection with that replacement and
on such terms as to evidence and indemnity as the Issuer Trustee may reasonably
require. Mutilated or defaced Class A Notes must be surrendered before
replacements will be issued.
12. NOTICES
All notices, other than notices given in accordance with the following
paragraph, to Class A Noteholders shall be deemed given if in writing and
mailed, first-class, postage prepaid to each Class A Noteholder, at his or her
address as it appears on the Note Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice. In
any case where notice to Class A Noteholders is given by mail, neither the
failure to mail such notice nor any defect in any notice so mailed to any
particular Class A Noteholder shall affect the sufficiency of such notice with
respect to other Class A Noteholders, and any notice that is mailed in the
manner herein provided shall conclusively be presumed to have been duly given.
A notice may be waived in writing by the relevant Class A Noteholder, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Class A Noteholders shall be filed with the Note
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
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Any such notice shall be deemed to have been given on the date such notice
is deposited in the mail.
In case, by reason of the suspension of regular mail services as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Class A Noteholders when such notice is required to be
given, then any manner of giving such notice as the Trustee shall direct the
Note Trustee shall be deemed to be a sufficient giving of such notice.
Any notice specifying a Payment Date, an Interest Rate, Interest payable, a
Principal Payment (or the absence of a Principal Payment), an Invested Amount, a
Stated Amount or a Bond Factor shall be deemed to have been duly given if the
information contained in such notice appears on the relevant page of the Reuters
Screen or such other similar electronic reporting service as may be approved by
the Note Trustee and notified to Class A Noteholders (the "Relevant Screen").
Any such notice shall be deemed to have been given on the first date on which
such information appeared on the Relevant Screen. If it is impossible or
impracticable to give notice in accordance with this paragraph then notice of
the matters referred to in this Condition shall be given in accordance with the
preceding paragraph.
The Principal Paying Agent shall deliver a quarterly servicing report for
each Collection Period to each Class A Noteholder on the Notice date relating to
such Collection Period in the method provided in the first paragraph of this
Condition 12.
13. MEETINGS OF VOTING MORTGAGEES AND VOTES OF CLASS A 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 the Class A Noteholders to
consider any matter affecting their interests. In general, the holders of a
majority of the aggregate Invested Amount of the Class A Notes may take or
consent to any action permitted to be taken by Class A Noteholders under the
Note Trust Deed. Notwithstanding the foregoing, the consent of holders of 75% of
the aggregate Invested Amount of the Class A Notes shall be required to (i)
direct the Note Trustee to direct the Security Trustee to enforce the security
under the Note Trust Deed, (ii) override any waiver by the Note Trustee of a
breach of any provisions of the Transaction Documents or an Event of Default,
(iii) alter, add, or modify the terms and conditions of the Class A Notes or the
provisions of any of the Transaction Documents if such alteration, addition or
modification is, in the opinion of the Note Trustee, materially prejudicial or
likely to be materially prejudicial to the Offered Noteholders as a whole or the
Class A Noteholders, which shall include any modification to 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
percentage of the aggregate Invested Amount required to consent to any action 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"). 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 that would be materially
prejudicial to the interests of the Class A Noteholders. Except in certain
circumstances, the Note Trust Deed imposes no
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such limitations on the powers of the Class A Noteholders, the exercise of which
will be binding on the Class B Noteholders, irrespective of the effect on the
Class B Noteholders' interests. Any action taken by the requisite percentage of
the Invested Amount of the Class A Noteholders shall be binding on all Class A
Noteholders (both present and future).
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
authorisation of any breach or proposed breach of the Class A Notes (including
these 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 these
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,
authorisation 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 A Noteholders in accordance with Class A Condition 12 as
soon as practicable thereafter.
14. INDEMNIFICATION AND EXONERATION OF THE NOTE TRUSTEE AND THE SECURITY TRUSTEE
The Note Trust Deed contains provisions for the indemnification of the Note
Trustee and for its relief from responsibility, including provisions relieving
it from taking proceedings to realise the security and to obtain repayment of
the Class A Notes unless indemnified to its satisfaction. Each of the Note
Trustee and the Security Trustee is entitled to enter into business transactions
with the Issuer Trustee and/or any other party to the Relevant Documents without
accounting for any profit resulting from such transactions. Neither the Security
Trustee nor the Note Trustee will be responsible for any loss, expense or
liability which may be suffered as a result of any assets secured by the
Security Trust Deed, Mortgaged Property or any deeds or documents of title
thereto, being uninsured or inadequately insured or being held by or to the
order of the Servicer or any of its affiliates or by clearing organisations or
their operators or by any person on behalf of the Note Trustee.
15. LIMITATION OF LIABILITY OF THE ISSUER TRUSTEE
(A) GENERAL
Clause 33 of the Master Trust Deed applies to the obligations and
liabilities of the Issuer Trustee in relation to this Class A Note.
(B) LIABILITY OF TRUSTEE LIMITED TO ITS RIGHT OF INDEMNITY
(i) This Class A Note applies to the Issuer Trustee only in its capacity as
trustee of the Trust and in no other capacity. A liability arising under or in
connection with this Class A Note or the Trust 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 this Class A Note or any other Transaction Document 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 this Class A Note or the Trust.
(ii) None of the Note Trustee or the Class A Noteholders may take action
against the Issuer 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 Issuer Trustee or
prove in any liquidation, administration or arrangements of or affecting the
Issuer Trustee.
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(iii) The provisions of this Condition 15 shall not apply to any obligation
or liability of the Issuer 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 Issuer Trustee's indemnification out of the Trust Assets as
a result of the Issuer Trustee's fraud, negligence or breach of trust.
(iv) It is acknowledged that the Trust Manager, the Servicer, each Paying
Agent, the Agent Bank and the Note Trustee (each a "Relevant Party") are
responsible under the Transaction Documents for performing a variety of
obligations relating to the Trust. No act or omission of the Issuer Trustee
(including any related failure to satisfy its obligations under this Class A
Note or a Transaction Document) will be considered fraud, negligence or breach
of trust of the Issuer Trustee for the purpose of sub-paragraph (iii) of this
Condition 15 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 Issuer Trustee and for whom the Issuer Trustee is
responsible under the Transaction Documents, other than a 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 Issuer
Trustee and for whom the Issuer Trustee is responsible under the Transaction
Documents, other than a Relevant Party).
(v) No attorney, agent, receiver or receiver and manager appointed in
accordance with a Transaction Document (including without limitation a Relevant
Party) has authority to act on behalf of the Issuer Trustee in a way which
exposes the Issuer 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
Issuer Trustee for the purpose of sub-paragraph (iii), if the Issuer Trustee has
exercised reasonable care in the selection and supervision of such a person.
16. GOVERNING LAW
The Class A Notes and the Relevant Documents (other than the Security Trust
Deed which is governed by the laws of the Australian Capital territory and the
Currency Swap with Morgan Guaranty Trust Company of New York, London Office,
which is governed by the laws of England) are governed by, and shall be
construed in accordance with, the laws of New South Wales, Australia.
SUMMARY OF PROVISIONS RELATING TO THE CLASS B NOTES WHILE IN BOOK ENTRY FORM
Each of the Class A Notes will initially be represented by a typewritten
book-entry note (the Book-Entry Class A Note"), without coupons, in the
principal amount of US$__________. The Book-Entry Class A Note will be deposited
with the Common Depositary for DTC on or about the Closing Date. Upon deposit of
the Book-Entry Class A Note with the Common Depositary, DTC will credit each
investor in the Class A Notes with a principal amount of Class A Notes for which
it has subscribed and paid.
The Book-Entry Class A Note will be exchangeable for definitive Class A
Notes in bearer form in certain circumstances described below.
Each person who is shown in the Note Register as the holder of a particular
principal amount of Class A Notes will be entitled to be treated by the Issuer
Trustee and the Note Trustee as a holder of such principal amount of Class A
Notes and the expression "Class A Noteholder" shall be construed accordingly,
but without prejudice to the entitlement of the holder of the Book-Entry Class B
Note to be paid principal and interest thereon in accordance with its terms.
Such persons shall have no claim directly against the Issuer Trustee in respect
of payment due on the Class A Notes for so long as the Class A Notes are
represented by a Book-Entry Class A Note and the relevant obligations of the
Issuer Trustee will be discharged by payment to the registered holder of the
Book-Entry Class A Note in respect of each amount so paid.
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(A) PAYMENTS
Interest and principal on each Global Class A Note will be payable by the
Common Depositary to the Principal Paying Agent provided that no payment of
interest may be made by the Issuer Trustee or any Paying Agent in the
Commonwealth of Australia or its possessions or into a bank account or to an
address in the Commonwealth of Australia or its possessions.
Each of the persons appearing from time to time as the beneficial owner of a
Class A Note will be entitled to receive any payment so made in respect of that
Class A Note in accordance with the respective rules and procedures of DTC. Such
persons will have no claim directly against the Issuer Trustee in respect of
payments due on the Class A Notes which must be made by the holder of the
relevant Book-Entry Class A Note, for so long as such Book-Entry Class A Note is
outstanding.
[A record of each payment made on a Book-Entry Class B Note, distinguishing
between any payment of principal and any payment of interest, will be recorded
in the Note Register by the Principal Paying Agent and such record shall be
prima facie evidence that the payment in question has been made.]
(B) EXCHANGE
The Book-Entry Class A Note will be exchangeable for definitive Class A
Notes only if:
(a) the Trust Manager advises the Principal Paying Agent in writing that the
Clearing Agency is no longer willing or able properly to discharge its
responsibilities with respect to the Class A Notes or the Clearing Agency
carry on business, and the Trust Manager is unable to located a qualified
successor;
(b) the Issuer Trustee, at the direction of the Trust Manager (at the Trust
Manager's option) advises the Principal Paying Agent in writing that the
book entry system through the Clearing Agency is or is to be terminated; or
(c) after the occurrence of an Event, of Default the Class A Note Owner's
representing beneficial interests aggregating to at least a majority of the
aggregate Invested Amount of the Class A Notes advise the Principal Paying
Agent and Issuer Trustee through the Clearing Agency in writing that the
continuation of a book entry system through the Clearing Agency is no longer
in the best interest of the Note Owners,
then the Principal Paying Agent shall notify all Class A Note Owners and the
Issuer Trustee of the occurrence of any such event and of the availability of
Definitive Notes to Class A Note Owners requesting the same. Upon the surrender
of the Book-Entry Notes to the Issuer Trustee by the Clearing Agency, and the
delivery by the Clearing Agency of the relevant registration instructions to the
Issuer Trustee, the Issuer Trustee shall execute and authenticate the Definitive
Notes in accordance with the instructions of the Clearing Agency.
(C) NOTICES
So long as the Notes are represented by the Book-Entry Class A Note and the
same is/are held on behalf of the Clearing Agency, notices to Class A
Noteholders may be given by delivery of the relevant notice to the Clearing
Agency for communication by them to entitled account holders in substitution for
delivery to each Class A Noteholder as required by the Class A Conditions.
(D) CANCELLATION
Cancellation of any Class A Note required by the Class A Conditions will be
effected by reduction in the principal amount of the relevant Book-Entry Class A
Note.
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APPENDIX III--TERMS AND CONDITIONS OF THE CLASS B NOTES
TERMS AND CONDITIONS OF THE CLASS B NOTES
THE FOLLOWING, SUBJECT TO AMENDMENTS, ARE THE TERMS AND CONDITIONS OF THE
CLASS B NOTES, SUBSTANTIALLY AS THEY WILL APPEAR ON THE REVERSE OF THE CLASS B
NOTES. CLASS B NOTES IN DEFINITIVE FORM WILL ONLY BE ISSUED IN CERTAIN
CIRCUMSTANCES. WHILE THE CLASS B NOTES REMAIN IN BOOK-ENTRY FORM, THE SAME TERMS
AND CONDITIONS GOVERN THEM, EXCEPT TO THE EXTENT THAT THEY ARE APPROPRIATE ONLY
TO THE CLASS B NOTES IN DEFINITIVE FORM. FOR A SUMMARY OF THE PROVISIONS
RELATING TO THE CLASS B NOTES IN BOOK-ENTRY FORM, SEE THE SUMMARY AT THE END OF
THIS SECTION.
The issue of US$ Class B Mortgage Backed Floating Rate Notes due
2029 (the "Class B Notes") of Westpac Securities Administration Limited in its
capacity as trustee of the Series 1998-1G WST Trust (the "Trust"), in such
capacity (the "Issuer Trustee Trustee") was authorised by resolution[s] of the
Board of Directors of the Issuer Trustee Trustee passed on [*]. These Notes,
together with US$ Class A Mortgage Backed Floating Rate Notes due 2029
(the "Class A Notes" and, together with the Class B Notes, the "Notes") of the
Issuer Trustee Trustee are (a) issued subject to a Master Trust Deed (the
"Master Trust Deed") dated 14th February 1997 between the Issuer Trustee and The
Mortgage Company Pty Limited, acceded to by Westpac Securitisation Management
Pty Limited (the "Trust Manager"), by a Series Notice (the "Series Notice")
dated [*] between (among others) the Issuer Trustee Trustee, Morgan Guaranty
Trust Company of New York, [London] of office (the note trustee for the time
being referred to as the "Note Trustee") as trustee for the holders for the time
being of the Class B Notes (the "Class B Noteholders") and the holders for the
time being of the Class A Notes (the "Class A Noteholders" and together with the
Class B Noteholders, the "Noteholders") and the Trust Manager, and by these
terms and conditions (the "Class B Conditions"); (b) issued subject to a note
trust deed dated [*] (the "Note Trust Deed") between the Issuer Trustee Trustee,
the Trust Manager and the Note Trustee; and (c) secured by a Security Trust Deed
(the "Security Trust Deed") dated [*] between the Issuer Trustee Trustee, the
Trust Manager, the Note Trustee and Perpetual Trustee Company Limited (ACN 000
001 007) (the security trustee for the time being referred to as "Security
Trustee").
The statements set out below include summaries of, and are subject to the
detailed provisions of the Master Trust Deed, the Series Notice, the Security
Trust Deed and the Note Trust Deed. Certain words and expressions used herein
have the meanings defined in those documents. In accordance with an agency
agreement (the "Agency Agreement") dated [*] between the Issuer Trustee, the
Trust Manager, the Note Trustee and Morgan Guaranty Trust Company of New York,
London office as principal paying agent (the "Principal Paying Agent", which
expression includes its successors as principal paying agent under the Agency
Agreement) and as agent bank (the "Agent Bank", which expression includes its
successors as Agent Bank under the Agency Agreement), and under which further
paying agents may be appointed (together with the Principal Paying Agent, the
"Paying Agents", which expression includes the successors of each paying agent
as such under the Agency Agreement and any additional paying agents appointed),
payments in respect of the Class B Notes will be made by the Paying Agents and
the Agent Bank will make the determinations specified in the Agency Agreement.
The Class B Noteholders will be entitled (directly or indirectly) to the benefit
of, will be bound by, and will be deemed to have notice of, all the provisions
of the Master Trust Deed, the Series Notice, the Security Trust Deed, the Note
Trust Deed and the Servicing Agreement as amended (the "Servicing Agreement
Amendment Agreement") dated [*] and made between the Issuer Trustee, Westpac
Banking Corporation ("Westpac") and The Mortgage Company Pty Limited as Servicer
(together with any substitute or successor, the "Servicer") (together with the
Currency Swap Agreements (as defined below), those documents the "Relevant
Documents" and, together with certain other transaction documents defined as
such in the Series Notice, the "Transaction Documents"). Copies of the
Transaction Documents are available for inspection at the principal office of
the Principal Paying Agent, being at the date hereof 60 Victoria Embankment,
London EC4Y 0JP.
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In connection with the issue of the Class B Notes, the Issuer Trustee has
entered into an ISDA master interest rate and currency exchange agreement dated
[*] with Westpac Banking Corporation in such capacity (the "Interest Rate Swap
Provider") together with three confirmations relating thereto dated [*] (the
"Variable Rate Basis Swap" and the "Fixed Rate Basis Swap", respectively and,
together, the "Interest Rate Swaps"). The Issuer Trustee has also entered into
ISDA master interest rate and currency exchange agreements dated [*] with each
of Morgan Guaranty Trust Company of New York, London office and Westpac Banking
Corporation (each, in such capacity a "Currency Swap Provider", and together
with the Interest Rate Swap Provider, the "Swap Providers") together with two
confirmations relating to each such agreement dated [*] in respect of two
distinct swap transactions relating to each of the Class B Notes and the Class A
Notes, respectively (each, a "Currency Swap", and together the "Currency
Swaps").
1. FORM, DENOMINATION AND TITLE
The Class B Notes will be issued in registered form, without interest
coupons, in minimum denominations of US$100,000 and integral multiples thereof.
The Class B Notes will be represented by one or more typewritten fully
registered book-entry notes (each, a "Book-Entry Note" and collectively, the
"Book-Entry Notes") registered in the name of Cede & Co. ("Cede") as nominee of
The Depository Trust Company ("DTC"). Beneficial interests in the Book-Entry
Notes will be shown on, and transfers thereof will be effected only through,
records maintained by DTC and its participants. Morgan Guaranty Trust Company of
New York, Brussels office, as operator of the Euroclear System ("Euroclear") and
Cedel Bank, societe anonyme ("Cedel Bank"), may hold interests in the Book-Entry
Notes on behalf of persons who have accounts with Euroclear and Cedel Bank
through accounts maintained in the names of Euroclear or Cedel Bank, or in the
names of their respective depositories, with DTC.
If the Issuer Trustee is obliged to issue Definitive Notes under clause 3.3
of the Note Trust Deed, interests in the applicable Book-Entry Note will be
transferred to the beneficial owners thereof in the form of Definitive Notes,
without interest coupons, in the denominations set forth above. A Definitive
Note will be issued to each Noteholder in respect of its registered holding or
holdings of Class B Notes against delivery by such Noteholders of a written
order containing instructions and such other information as the Issuer Trustee
and Morgan Guaranty Trust Company of New York, London office, acting as note
registrar (the "Note Registrar") may require to complete, execute and deliver
such Definitive Notes. In such circumstances, the Issuer Trustee will cause
sufficient Definitive Notes to be executed and delivered to the Note Registrar
for completion, authentication and dispatch to the relevant Noteholders.
2. STATUS, SECURITY AND RELATIONSHIP BETWEEN THE CLASS B NOTES, THE CLASS A
NOTES, THE RFSS AND THE RFS CLASS A NOTES
The Class B Notes are secured by a first ranking floating charge over all of
the assets of the Trust (which include, among other things, the Loans (as
defined below) and the Mortgages (as defined below) and related securities) (as
more particularly described in the Security Trust Deed) and rank PARI PASSU and
rateably without any preference or priority among themselves.
The Class B Notes are constituted by the Master Trust Deed and the Series
Notice and are secured by the same security as secures the Class A Notes but the
Class A Notes will rank in priority to the Class B Notes in the event of the
security being enforced and in respect of principal and interest (as set out in
Class B Condition 4 and 5).
The proceeds of the issue of the Class B Notes and the Class A Notes are to
be used by the Issuer Trustee to purchase an equitable interest in certain
housing loans (the "Loans") and certain related mortgages (the "Mortgages") from
Westpac or Westpac Securities Administration Limited in its capacity as trustee
of certain other trusts (each a "WST Seller").
In the event that the security for the Class B Notes is enforced and the
proceeds of such enforcement are insufficient, after payment of all other claims
ranking in priority to or PARI PASSU with the Class B Notes
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under the Security Trust Deed, to pay in full all principal and interest and
other amounts whatsoever due in respect of the Class B Notes, then the Class B
Noteholders shall have no further claim against the Issuer Trustee in respect of
any such unpaid amounts.
The net proceeds of realisation of the assets of the Trust may be
insufficient to pay all amounts due to the Noteholders. Save in certain limited
circumstances the other assets of the Issuer Trustee will not be available for
payment of any shortfall arising and all claims in respect of such shortfall
shall be extinguished (see further Class B Condition 15). None of the Servicer,
the Trust Manager, the Seller Trustee, Westpac, the Note Trustee or the Security
Trustee has any obligation to any Noteholder for payment of any amount by the
Issuer Trustee in respect of the Notes.
THE ISSUER TRUSTEE MAY FROM TIME TO TIME ISSUE DEBT SECURITIES ("RFSS")
CONSTITUTED UNDER THE MASTER TRUST DEED AND THE SERIES NOTICE TO FUND AMOUNTS
REDRAWN BY RELEVANT BORROWERS UNDER THE LOANS (UP TO THE SCHEDULED AMORTISED
PRINCIPAL OF THE LOANS) FROM TIME TO TIME ("REDRAWS"). RFSS AND CLASS A NOTES
WILL, ON ISSUE, RANK AHEAD OF THE CLASS B NOTES AS TO BOTH PRINCIPAL AND
INTEREST EXCEPT IN THE LIMITED CIRCUMSTANCES SET OUT IN THESE CONDITIONS.
IF, BY THE FIFTH COLLECTION DETERMINATION DATE (AS DEFINED IN CLASS A
CONDITION 5) FOLLOWING THE ISSUE OF AN RFS, THE RFS HAS NOT BEEN REDEEMED, IT
SHALL CONVERT TO AN RFS CLASS A NOTE (EACH, AN "RFS CLASS A NOTE" AND, TOGETHER
THE "RFS CLASS A NOTES"). RFS CLASS A NOTES WILL RANK AHEAD OF CLASS B NOTES AS
TO BOTH PRINCIPAL AND INTEREST EXCEPT IN THE LIMITED CIRCUMSTANCES SET OUT IN
THESE CONDITIONS. RFSS AND RFS CLASS A NOTES ARE REGISTERED, AUSTRALIAN-TRADED
INSTRUMENTS DENOMINATED IN AUSTRALIAN DOLLARS ("A$") AND SOLD TO AUSTRALIAN
INVESTORS ONLY AND FOR THE AVOIDANCE OF DOUBT ARE NOT FUNGIBLE WITH THE CLASS B
NOTES.
THE NOTE TRUST DEED CONTAINS PROVISIONS REQUIRING THE NOTE TRUSTEE TO HAVE
REGARD TO THE INTERESTS OF THE CLASS A NOTEHOLDERS AND THE CLASS B NOTEHOLDERS
AS REGARDS ALL THE POWERS, TRUSTS, AUTHORITIES, DUTIES AND DISCRETIONS OF THE
NOTE TRUSTEE (EXCEPT WHERE EXPRESSLY PROVIDED OTHERWISE), BUT REQUIRING THE NOTE
TRUSTEE IN ANY SUCH CASE TO HAVE REGARD ONLY TO THE INTERESTS OF THE CLASS A
NOTEHOLDERS IF, IN THE NOTE TRUSTEE'S OPINION, THERE IS A CONFLICT BETWEEN THE
INTERESTS OF THE CLASS A NOTEHOLDERS AND THE INTERESTS OF THE CLASS B
NOTEHOLDERS.
THE SECURITY TRUST DEED CONTAINS PROVISIONS REQUIRING THE SECURITY TRUSTEE
TO GIVE PRIORITY TO THE INTERESTS OF THE CLASS A NOTEHOLDERS AND THE HOLDERS OF
RFSS (IF ANY) AND RFS CLASS A NOTES (IF ANY), IF THERE IS A CONFLICT BETWEEN THE
INTERESTS OF SUCH NOTEHOLDERS AND ANY OTHER VOTING MORTGAGEE (AS DEFINED BELOW),
INCLUDING THE CLASS B NOTEHOLDERS.
3. COVENANTS OF THE ISSUER TRUSTEE
So long as any of the Class A Notes or the Class B Notes remains
outstanding, the Issuer Trustee has made certain covenants for the benefit of
Class A Noteholders and the Class B Noteholders which are set out in the Master
Trust Deed.
These covenants are as follows:
(a) 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.
(b) The Issuer Trustee shall:
(i) act honestly and in good faith in the performance of its duties and
in the exercise of its discretions 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 discretions 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;
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(iii) use its best endeavours 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 authorisations) 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.
(c) 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 asset of the Trust (the "Trust
Assets").
(d) 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.
(e) The Issuer Trustee will open and operate certain bank accounts in
accordance with the Master Trust Deed and the Series Notice.
(f) 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.
(g) The Issuer Trustee shall properly perform the functions which are
necessary for it to perform under all Transaction Documents in respect of the
Trust.
4. INTEREST
(A) PAYMENT DATES
Each Class B Note bears interest on its Invested Amount (as defined below)
from and including 9 June 1998 or such later date as may be agreed between the
Issuer Trustee and the Managers for the issue of the Class B Notes (the "Closing
Date"). Interest in respect of the Class B Notes will be payable quarterly in
arrear on the 19th day falling in July 1998 in respect of the period from (and
including) the Closing Date to (but excluding) that date, and thereafter on each
19 April, 19 July, 19 October and 19 January (each such date a "Payment Date"
and each such three month period beginning on each of 1 April, 1 July, 1 October
and 1 January a "Quarter"). If any Payment Date would otherwise fall on a day
which is not a Business Day (as defined below), it shall be postponed to the
next day which is a Business Day (as defined below) unless it would thereby fall
into the next calendar month in which event it shall be brought forward to the
immediately preceding Business Day.
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"Business Day" in this Class B Condition 4 and in Class B Conditions 5 and 9
below means any day (London time) other than a Saturday, Sunday or public
holiday on which banks are open for business in Sydney, London and New York
City.
The period beginning on (and including) the Closing Date and ending on (but
excluding) the first Payment Date and each successive period beginning on (and
including) a Payment Date and ending on (but excluding) the next Payment Date is
called an "Interest Period". Interest payable on a Class B Note in respect of
any Interest Period or any other period will be calculated on the basis of the
actual number of days elapsed and a 360 day year.
Interest shall cease to accrue on any Class B Note from (and including):
(i) the date on which the Stated Amount (as defined in Class B Condition
5(a)) of that Class B Note is reduced to zero; or
(ii) if the Stated Amount on the due date for redemption is not zero, the
due date for redemption of the Class B Note, unless, upon due presentation,
payment of principal due is improperly withheld or refused, following which
interest shall continue to accrue on the Invested Amount of the Class B Note at
the rate from time to time applicable to the Class B Notes until the moneys in
respect of that Class B Note have been received by the Note Trustee or the
Principal Paying Agent and notice to that effect is given in accordance with
Class B Condition 12, or the Stated Amount of that Class B Note has been reduced
to zero.
(B) INTEREST RATE
The rate of interest applicable from time to time to the Class B Notes (the
"Interest Rate") will be determined by the Agent Bank on the basis of the
following paragraphs.
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 an 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 US Dollars which appears on the Telerate Page
3750 as of 11am London time, on the Interest Determination Date. If such rate
does not appear on the Telerate Page 3750, the rate for the 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 US Dollars are offered by the Reference Banks (being four major banks in the
London interbank market) at approximately 11.00 am, 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 am, New York City time, on
that Interest Determination Date for loans in US 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 Interest Payment Date.
The Interest Rate applicable to the Class B Notes for such Interest Period
shall be the aggregate of (i) such Interest Rate or arithmetic mean as
determined by the Agent Bank and (ii) the margin of 0.[*]% applicable to the
Class B Notes.
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There is no maximum or minimum Interest Rate.
(C) DETERMINATION OF INTEREST RATE AND CALCULATION OF INTEREST
The Agent Bank will, as soon as practicable after 11.00 am (London time) on
each Interest Determination Date, determine the Interest Rate applicable to, and
calculate the amount of interest payable (the "Interest") for the immediately
succeeding Interest Period. The Interest is calculated by applying the Interest
Rate for the Class B Notes to the Invested Amount (as defined in Class B
Condition 5(a)) of the Class B Note on the first day of the next Interest
Period, multiplying such product by the actual number of days in the relevant
Interest Period and dividing by 360 and rounding the resultant figure down to
the nearest cent (half a cent being rounded upwards). The determination of the
Interest Rate and the Interest by the Agent Bank shall (in the absence of
manifest error) be final and binding upon all parties.
(D) NOTIFICATION AND PUBLICATION OF INTEREST RATE AND INTEREST
The Agent Bank will cause the Interest Rate and the Interest applicable to
each Class B Note for each Interest Period and the relevant Payment Date to be
notified to the Issuer Trustee, the Trust Manager, the Note Trustee, the Paying
Agents, and, for so long as the Class B Notes are listed on the Official List of
the London Stock Exchange Limited (the "London Stock Exchange"), the London
Stock Exchange, and will cause the same to be published in accordance with Class
B Condition 12 on or as soon as possible after the date of commencement of the
relevant Interest Period. The Interest and the relevant Payment Date so
published may subsequently be amended (or appropriate alternative arrangements
made by way of adjustment) without notice in the event of a shortening of the
Interest Period.
(E) DETERMINATION OR CALCULATION BY THE NOTE TRUSTEE
If the Agent Bank at any time for any reason does not determine the Interest
Rate or calculate the Interest for a Class B Note, the Note Trustee shall do so
and each such determination or calculation shall be deemed to have been made by
the Agent Bank. In doing so, the Note Trustee shall apply the foregoing
provisions of this Condition, with any necessary consequential amendments, to
the extent that, in its opinion, it can do so, and, in all other respects it
shall do so in such a manner as it shall deem fair and reasonable in all the
circumstances.
(F) AGENT BANK
The Issuer Trustee will procure that, so long as any of the Class B Notes
remains outstanding, there will at all times be an Agent Bank. The Issuer
Trustee reserves the right at any time to terminate the appointment of the Agent
Bank. Notice of that termination will be given to the Class B Noteholders. If
any person is unable or unwilling to continue to act as the Agent Bank, or if
the appointment of the Agent Bank is terminated, the Issuer Trustee will, with
the approval of the Note Trustee, appoint a successor Agent Bank to act as such
in its place, provided that neither the resignation nor removal of the Agent
Bank shall take effect until a successor approved by the Note Trustee has been
appointed.
5. REDEMPTION AND PURCHASE
(A) MANDATORY REDEMPTION IN PART FROM PRINCIPAL COLLECTIONS AND
APPORTIONMENT OF PRINCIPAL COLLECTIONS BETWEEN THE CLASS A NOTES, THE CLASS
B NOTES, THE RFS CLASS A NOTES AND THE RFSS
The Class B Notes shall be subject to mandatory redemption in part on any
Payment Date if on that date there are any Principal Collections (as defined
below) available to be distributed in relation to such Class B Notes. The
principal amount so redeemable in respect of each Class B Note prior to
enforcement of the Security Trust Deed (each a "Principal Payment") on any
Payment Date shall be the amount available for payment as set out in Class B
Condition 5(b) on the day which is four Business Days prior to the Payment Date
(the "Collection Determination Date") preceding that Payment Date multiplied by
the
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Invested Amount of the applicable Class B Note over the total Invested Amount of
all Class B Notes then outstanding (rounded down to the nearest cent with half a
cent being rounded upwards); provided always that no Principal Payment on a
Class B Note on any date may exceed the amount equal to the Invested Amount of
that Class B Note at that date less amounts charged off as at that date, or to
be charged off on the following Payment Date, as described in Class B Condition
5(c) (that reduced amount being the "Stated Amount" of that Class B Note).
The "Invested Amount" of a Class B Note is equal to the Initial Invested
Amount (as defined herein) of such Class B Note less all payments previously
made in respect of principal in respect of such Class B Note. The "Initial
Invested Amount" of a Class B Note is its principal balance at the date of its
issuance.
"Principal Collections" means, in respect of a Collection Period (as defined
below) and as applicable on any Collection Determination Date, the aggregate of:
(i) all amounts received by or on behalf of the Issuer Trustee from or on
behalf of borrowers under the Loans during the Collection Period in respect of
principal, in accordance with the terms of the Loans, including principal
prepayments;
(ii) all other amounts received by or on behalf of the Issuer Trustee under
or in respect of principal under the Loans and the Mortgages during that
Collection Period including:
(A) any amounts recovered in respect of enforcement of Loans and Mortgages
(other than under lender's mortgage insurance), on account of principal;
(B) any payments by Westpac to the Issuer Trustee on the repurchase of a
Loan under the Master Trust Deed during that Collection Period which are
attributable to principal;
(C) any payments by Westpac Securities Administration Limited (in its
capacity as trustee of any other trust established under the Master Trust Deed)
(the "WST Purchaser") on the purchase by the WST Purchaser of any assets of the
Trust which are attributable to principal;
(D) any Prepayment Costs (as defined in the Series Notice) applied towards
Prepayment Benefits (as defined in the Series Notice) under the Series Notice;
and
(E) any Prepayment Benefit Shortfall (as defined in the Series Notice) paid
by Westpac to the Trust under the Series Notice;
(iii) all amounts received by or on behalf of the Issuer Trustee during that
Collection Period from any provider of a Support Facility (as defined in the
Series Notice) (other than the Currency Swap) under that Support Facility and
which the Trust Manager determines should be accounted for to reduce any
principal loss on a Loan, being the total amount outstanding under a Loan after
applying all proceeds from the enforcement of the Loan and related Mortgages (a
"Liquidation Loss") to the extent that Liquidation Loss is attributable to
principal;
(iv) all amounts received by or on behalf of the Issuer Trustee during that
Collection Period:
(A) from Westpac or the WST Seller Trustee (each an "Approved Seller") in
respect of any breach of a representation, warranty or undertaking contained in
the Master Trust Deed or the Series Notice;
(B) from an Approved Seller under any obligation under the Master Trust Deed
or the Series Notice to indemnify or reimburse the Issuer Trustee for any
amount;
(C) from the Servicer, in respect of any breach of any representation,
warranty or undertaking contained in the Servicing Agreement; and
(D) from the Servicer under any obligation under the Servicing Agreement to
indemnify or reimburse the Issuer Trustee for any amount,
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in each case, which are determined by the Trust Manager to be in respect of
principal payable under the Loans and the Mortgages;
(v) any amounts in the nature of principal received by or on behalf of the
Issuer Trustee during that Collection Period pursuant to the sale of any asset
comprised in the Trust (including any amount received by the Issuer Trustee on
the issue of Notes and which was not used to purchase Loans or Mortgages, and
which the Trust Manager determines is surplus to the requirements of the Trust);
(vi) (for the purposes of clause 6.11 of the Series Notice only) any amount
of Excess Available Income (as defined in the Series Notice) to be applied to
pay a Principal Charge Off or a Carryover Charge Off (as defined in the Series
Notice);
(vii) 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 dated [*] between
the Issuer Trustee, the Trust Manager and Westpac (the "Redraw Facility");
(viii) any Excess Available Income to be applied to Principal Draws (as
defined in the Series Notice) made on a previous Payment Date;
(ix) any Prepayment Calculation Adjustment (as defined in the Series Notice)
for that Collection Period;
(x) any Substitution Net Transfer Amount (Principal) (as defined in the
Series Notice) received by the Trust from a WST Purchaser with respect to that
Collection Period;
less any amounts deducted by or paid to Westpac to reimburse Redraws funded by
Westpac for which Westpac has not previously been reimbursed. A premium
receivable by the Issuer Trustee on the entry into a replacement Currency Swap
under clause 6.26 of the Series Notice is not treated as a Principal Collection.
"Collection Period" means, in relation to a Payment Date, the period from
(and including) the tenth day of the Quarter preceding the Quarter in which the
Payment Date occurs to (and including) the ninth day of the Quarter in which the
Payment Date occurs. The first Collection Period is the period from (but
excluding) May 6, 1998 (the "Cut-Off Date") to (and including) July 9. The last
Collection Period is the period from (but excluding) the last day of the
previous Collection Period to (and including) the termination date of the Trust.
(B) INITIAL PRINCIPAL DISTRIBUTIONS PRINCIPAL COLLECTIONS WILL BE
DISTRIBUTED AS FOLLOWS ON EACH PAYMENT DATE BEFORE ANY PAYMENTS IN RESPECT
OF THE NOTES:
(i) first, to repay any Redraws provided by Westpac in relation to Loans to
the extent that Westpac has not previously been reimbursed in relation to those
Redraws;
(ii) second, to repay all principal outstanding under the Redraw Facility on
that Payment Date;
(iii) third, to allocate to Total Available Funds any Principal Draw (as
defined in the Series Notice); and
(iv) fourth, to repay PARI PASSU and rateably all amounts outstanding under
the RFSs (if any).
(C) PRINCIPAL ALLOCATION METHOD
On each Collection Determination Date, the Trust Manager will determine the
A$ Equivalent of the aggregate of the Class B Stated Amounts divided by the sum
of (i) the A$ Equivalent of the Total Stated Amount at that time, plus (ii) the
Redraw Limit at that time, plus (iii) the aggregate of the RFS Stated Amount at
that time, plus (iv) the aggregate of the RFS Class A Stated Amounts at that
time (the
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"Subordinated Percentage"). The Trust Manager will calculate the Subordinated
Percentage so as to determine the appropriate principal distribution methodology
to apply for that Collection Period, as described below.
(D) APPLICABILITY OF SERIAL METHOD 1
If, on any Collection Determination Date:
(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 the third
anniversary of the Closing Date;
(iii) the Total Invested Amount as at that Collection Determination Date as
a percentage of the Total Initial Invested Amount, is greater than or equal to
10%;
(iv) the Average Quarterly Percentage as at that 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 Amounts of all Class B Notes as at that Collection
Determination Date exceeds 0.25% of the aggregate of all Initial Invested
Amounts of all Class A Notes and all Class B Notes as at the Collection
Determination Date;
then Principal Collections will be allocated serially in accordance with Serial
Method I set out in paragraph (e) below.
(E) SERIAL METHOD 1
On any Collection Determination Date, if the Trust Manager determines that
Serial Method 1 should apply, the Issuer Trustee (based on instructions from the
Trust Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions, on the Payment
Date following that Collection Determination Date the following amounts in the
following priority:
(i) first PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the sum of:
(aa) the Class A Percentage of Principal Collections remaining after all
Initial Principal Distributions; and
(bb) 50% of the Class B Percentage of those Principal Collections; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) 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:
(1) the RFS Class A Forex percentage of the sum of:
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(aa) the Class A Percentage of Principal Collections remaining after all
Initial Principal Distributions; and
(bb) 50% of the Class B Percentage of those Principal Collections; and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
(ii) second, as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to 50% of the Class B Percentage of those Principal Collections remaining
after all Initial Principal Distributions.
(F) APPLICABILITY OF SERIAL METHOD 2
If, on any Collection Determination Date:
(i) the Subordinated Percentage at the previous Collection Determination
Date was greater than or equal to twice the Initial Subordinated Percentage;
(ii) that Collection Determination Date occurs after the third anniversary
of the Closing Date;
(iii) the Total Invested Amount as at that Collection Determination Date, as
a percentage of the Total Initial Invested Amount, is greater than or equal to
10%;
(iv) the Average Quarterly Percentage as at the Collection Determination
Date:
(A) does not exceed 2% and the Total Carryover Charge Off on that Collection
Determination Date does not exceed 30% of the Class B Initial Invested Amount;
or
(B) does not exceed 4% and the Total Carryover Charge Off on that Collection
Determination Date does not exceed 10% of the Class B Initial Invested Amount;
and
(v) the Stated Amount of the Class B Notes as at that Collection
Determination Date exceeds 0.25% of the aggregate of all Initial Invested
Amounts of all Class A Notes and all Class B Notes and the US$ Equivalent of the
Invested Amounts of all RFS Class A Notes (if any);
then Principal Collections will be allocated serially in accordance with Serial
Method 2 set out in paragraph (g) below.
(G) SERIAL METHOD 2
On any Collection Determination Date, if the Trust Manager determines that
Serial Method 2 shall apply, the Issuer Trustee (based on instructions from the
Trust Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions on the Payment
Date following that Collection Determination Date in the following amounts in
the following priority:
(i) first, PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the Class A Percentage of Principal
Collections remaining after all Initial Principal Distributions; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) 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:
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(1) the RFS Class A Forex Percentage of the Class A Percentage of those
Principal Collections remaining after all Initial Principal Distributions: and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
(ii) second as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to the Class B Percentage of those Principal Collections.
(H) SEQUENTIAL METHOD
On any Collection Determination Date, if the Trust Manager determines that
neither Serial Method I nor Serial Method 2 (set out in Conditions 5(d) to (g)
above) applies, the Issuer Trustee (based on instructions from the Trust
Manager) will pay out of Principal Collections for the relevant Collection
Period which remain after the Initial Principal Distributions the following
amounts in the following priority:
(i) first PARI PASSU and rateably between themselves:
(A) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class A Notes of an amount equal
to the lesser of:
(1) the Class A Forex Percentage of the amount available for distribution
under this paragraph (i) after all Initial Principal Distributions; and
(2) the A$ Equivalent of the Class A Stated Amounts for all Class A Notes;
and
(B) as a payment, denominated in A$, to the holders of the RFS Class A Notes
(if any) of an amount equal to the lesser of:
(1) the RFS Class A Forex Percentage of the amount available for
distribution under this paragraph (i) after all Initial Principal Distributions;
and
(2) the RFS Class A Stated Amounts for all RFS Class A Notes (if any); and
(ii) second, as a payment, denominated in A$, to the Currency Swap Providers
under the relevant swap confirmations relating to the Class B Notes of an amount
equal to the lesser of:
(A) the amount available for distribution under this paragraph (ii) after
the application of paragraph (i); and
(B) the A$ Equivalent of the Class B Stated Amounts for all Class B Notes.
(I) GENERAL
No amount of principal will be paid to a Noteholder in excess of the Stated
Amount applicable to the Notes held by that Noteholder.
(J) DISTRIBUTION OF EXCESS AVAILABLE INCOME
On each Collection Determination Date Excess Available Income for the
Collection Period relating to that Collection Determination Date will be applied
in the following order of priority:
(i) to reimburse Principal Charge Offs for that Collection Period;
(ii) PARI PASSU and rateably between themselves (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):
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(A) as a payment to the RFSs (if any) in or towards reinstating the Stated
Amount of the RFSs, to the extent of any Carryover RFS Charge Offs;
(B) as a payment to the RFS Class A Notes (if any) in or towards reinstating
the Stated Amount of the RFS Class A Notes, to the extent of any Carryover RFS
Class A Charge Offs;
(C) as a payment to the Currency Swap Providers under the relevant swap
confirmations relating to the Class A Notes, of the A$ Equivalent of any
Carryover Class A Charge Offs; and
(D) as a repayment under the Redraw Facility Agreement, as a reduction of,
and to the extent of, any Carryover Redraw Charge Offs;
(iii) as a payment, denominated in A$, to the Currency Swap Providers under
the relevant swap confirmations relating to the Class B Notes of the A$
Equivalent of any Carryover Class B Charge Offs; and
(iv) to all Principal Draws which have not been repaid as at that Payment
Date.
Any amount to be paid pursuant to paragraphs (ii) and (iii) will be paid on
the Payment Date immediately following the Collection Determination Date.
(K) US$ ACCOUNT
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 Swaps into the US$ Account or to the Principal
Paying Agent under the Agency Agreement on behalf of the Issuer Trustee. The
Issuer Trustee shall pay all such amounts as follows, and in accordance with the
Note Trust Deed and the Agency Agreement:
(i) under Class A Condition 4, PARI PASSU in relation to the Class A Notes
as payments of Interest on those Class A Notes;
(ii) under Class A Condition 4, PARI PASSU in relation to the Class B Notes
as payments of Interest on those Class B Notes;
(iii) under Class B Condition 5(j)(ii)(C), PARI PASSU in relation to the
Class A Notes in or towards reinstating the Stated Amount of those Class A
Notes, to the extent of the Carryover Class A Charge Offs;
(iv) under Class B Condition 5(j)(iii), PARI PASSU in relation to Class B
Notes in or towards reinstating the Stated Amount of those Class B Notes, to the
extent of the Carryover Class B Charge Offs;
(v) under Class B Condition 5(e)(i)(A), 5(g)(i)(A) and 5(h)(i)(A) PARI PASSU
in relation to the Class A Notes as Class A Principal Payments until the Class A
Stated Amounts have been reduced to zero; and
(vi) under Class B Condition 5(e)(ii), 5(g)(ii) and 5(h)(ii) PARI PASSU in
relation to the Class B Notes as Class B Principal Payments until the Class B
Stated Amounts have been reduced to zero.
(L) CHARGE OFFS
If the Principal Charge Offs (as defined in the Series Notice) for any
Collection Period exceed the Excess Available Income (as defined in the Series
Notice) calculated on the Collection Determination Date for that Collection
Period, the Trust Manager must, on and with effect from the Payment Date
immediately following the end of the Collection Period:
(i) reduce PARI PASSU the Class B Stated Amount of each of the Class B Notes
by the US$ Equivalent of the amount of that excess which is attributable to each
Class B Note until the Class B Stated Amount is zero; and
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(ii) if the Class B Stated Amount is zero and any amount of that excess has
not been applied under paragraph (i), reduce PARI PASSU and rateably as between
themselves (based on the Stated Amount of the RFSs (if any), the Principal
Outstanding under the Redraw Facility, the Stated Amount of the RFS Class A
Notes (if any) and the A$ Equivalent of the Stated Amount of the Class A Notes):
(A) the Class A Stated Amount on each of the Class A Notes by the US$
Equivalent of the balance of that excess which is attributable to each Class A
Note until the Class A Stated Amount of that Class A Note is zero;
(B) the RFS Class A Stated Amount on each of the RFS Class A Notes (if any)
by the balance of that excess which is attributable to each RFS Class A Note
until the RFS Class A Stated Amount of that RFS Class A Note is zero;
(C) the RFS Stated Amount on each of the RFSs (if any) by the balance of
that excess which is attributable to each RFS until the RFS Stated Amount is
zero: and
(D) the principal outstanding under the Redraw Facility by the balance of
that excess until the Principal Outstanding is zero.
(M) CALCULATION OF PRINCIPAL PAYMENTS, STATED AMOUNT AND BOND FACTOR
(i) On each Collection Determination Date, the Trust Manager shall
determine:
(A) the amount of any Principal Payment in respect of each Class B Note on
the Payment Date following that Collection Determination Date;
(B) the Stated Amount and Invested Amount of each Class B Note as of the
first day of the next following Interest Period (after deducting any Principal
Payment due to be made in respect of each Class B Note on the next Payment Date)
and
(C) the fraction in respect of each Class B Note expressed as a decimal to
the seventh point (the "Bond Factor" of which the numerator is the aggregate of
the Invested Amount of all Class B Notes at that date less all Principal
Payments to be made on the following Payment Date, and the denominator is the
Initial Invested Amount of the Class B Notes.
(ii) The Trust Manager will notify the Note Trustee, the Principal Paying
Agent, the Agent Bank and (for so long as the Class B Notes are listed on the
London Stock Exchange) the London Stock Exchange by not later than the
Collection Determination Date immediately preceding the relevant Payment Date of
each determination of a Principal Payment, Invested Amount, Stated Amount and
Bond Factor and will immediately cause details of each of those determinations
to be published in accordance with Condition 12. If no Principal Payment is due
to be made on the Class B Notes on any Payment Date a notice to this effect will
be given to the Class B Noteholders in accordance with Class B Condition 12.
(iii) If the Trust Manager does not at any time for any reason determine a
Principal Payment, the Invested Amount, the Stated Amount or the Bond Factor
applicable to Class B Notes in accordance with this paragraph, the Principal
Payment, Invested Amount, the Stated Amount and the Bond Factor shall be
determined by the Note Trustee in accordance with this paragraph and paragraph
(i) above (but based on the information in its possession) and each such
determination or calculation shall be deemed to have been made by the Trust
Manager.
(iv) The Trust Manager will deliver to the Principal Paying Agent a
quarterly servicing report as set forth in clause 11 of the Note Trust Deed.
(N) 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
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deduct or withhold from any payment of principal or interest in respect of the
Class B 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 Loans for a Collection Period
ceases to be receivable (whether or not actually received) by the Issuer Trustee
during such Collection Period by reason 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, the Issuer Trustee must, when
so directed by the Trust Manager (at any time 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 the Class B Notes and any amounts required under
the Security Trust Deed to be paid in priority to or PARI PASSU with the Class B
Notes), upon having given not more than 60 nor less than 30 days' notice to the
Class B Noteholders in accordance with Class B Condition 12 redeem all, but not
some only, of the Class B Notes at their Invested Amount (or at the option of
the holders of 75% of the aggregate Invested Amount of Class B Notes at the
time, at their Stated Amount), together with accrued interest to the date of
redemption on any subsequent Payment Date, provided that the holders of 75% of
the aggregate Invested Amount of Class B Notes at the time may elect, and shall
notify the Issuer Trustee and the Trust Manager, that they do not require the
Issuer Trustee to redeem the Class B Notes in the circumstances described above.
(O) OPTIONAL REDEMPTION IN WHOLE
On any Payment Date, and upon giving no more than 60 nor less than 30 days'
notice to the Note Trustee and the Security Trustee, on which the aggregate
principal outstanding of the Loans is less than 10% of the aggregate principal
outstanding of the Loans at the Cut-Off Date, the Issuer Trustee may redeem all
(but not some only) of the Class B Notes at their Stated Amount.
(P) REDEMPTION ON MATURITY
If not otherwise redeemed, the Class B Notes will be redeemed at their
Stated Amount on the Payment Date falling in December 2029.
(Q) CANCELLATION
All Class B Notes redeemed in full pursuant to the foregoing provisions will
be cancelled forthwith, and may not be resold or reissued.
(R) CERTIFICATION
For the purposes of any redemption made pursuant to this Condition 5 the
Note Trustee may rely upon an officer's certificate under the Note Trust Deed
from the Trust Manager on behalf of the Issuer Trustee certifying or stating the
opinion of each person signing such certificate as:
(i) to the fair value (within 90 days of such release) of the property or
securities proposed to be released from the Security Trust Deed;
(ii) that in the opinion of such person the proposed release will not impair
the security under the Security Trust Deed in contravention of the provisions of
the Security Trust Deed or the Note Trust Deed;
(iii) that the Issuer Trustee will be in a position to discharge all its
liabilities in respect of the relevant Class B Notes; and
(iv) any amounts required under the Security Trust Deed to be paid in
priority to or PARI PASSU with those Class B Notes,
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and such officer's certificate shall be conclusive and binding on the
Trustee and the holders of those Class B Notes.
(S) PURCHASES
The Issuer Trustee may not purchase any Class B Notes at any time.
6. PAYMENTS
(A) METHOD OF PAYMENT
Any instalment of interest or principal, payable on any Class B Note which
is punctually paid or duly provided for by the Issuer Trustee to the Principal
Paying Agent on the applicable Payment Date or Maturity Date shall be paid to
the person in whose name such Class B Note is registered on the Record Date, by
cheque mailed first-class, postage prepaid, to such person's address as it
appears on the Note Register on such Record Date, except that, unless Definitive
Notes have been issued pursuant to clause 3.3 of the Note Trust Deed, with
respect to Class B Notes registered on the Record Date in the name of the
nominee of DTC (initially, such nominee to be Cede & Co.), payment will be made
by wire transfer in immediately available funds to the account designated by
such nominee and except for the final instalment of principal payable with
respect to such Class B Note on a Payment Date or Maturity Date.
(B) INITIAL PRINCIPAL PAYING AGENT
The initial Principal Paying Agent is Morgan Guaranty Trust Company of New
York, London Branch, at its office at 60 Victoria Embankment, London EC4Y 0JP.
(C) PAYING AGENTS
The Issuer Trustee (or the Trust Manager on its behalf after advising the
Issuer Trustee thereof) may at any time (with the previous written approval of
the Note Trustee) vary or terminate the appointment of any Paying Agent and
appoint additional or other Paying Agents, provided that it will at all times
maintain a Paying Agent having a specified office in London and in New York
City. Notice of any such termination or appointment and of any change in the
office through which any Paying Agent will act will be given in accordance with
Class B Condition 12.
(D) DUE DATE FOR REDEMPTION
If the due date for redemption in full of a Class B Note is not a Payment
Date, the interest accrued in respect of the period from the preceding Payment
Date (or from the Closing Date as the case may be) shall be payable only against
presentation or surrender of the relevant Class B Note.
(E) PAYMENTS ON BUSINESS DAYS
If the due date for payment of any amount of principal or Interest in
respect of any Class B Note is not a Business Day then payment will not be made
until the next succeeding Business Day and the holder thereof shall not be
entitled to any further interest or other payment in respect of that delay. In
this Condition 6 the expression "Business Day" means any day (other than a
Saturday, Sunday or a public holiday) on which banks are open for business in
the place where the specified office of the Paying Agent is situated and, in the
case of payment by transfer to a US dollar account, in New York City and prior
to any exchange of the Book-Entry Note (in respect of the Class B Notes) for any
definitive Class B Notes, on which DTC is open for business.
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(F) Interest
If Interest is not paid in respect of a Class B Note on the date when due
and payable (other than because the due date is not a Business Day), that unpaid
Interest shall itself bear interest at the Interest Rate applicable from time to
time to the Class B Notes until the unpaid interest, and interest on it, is
available for payment and notice of that availability has been duly given in
accordance with Class B Condition 12.
7. TAXATION
All payments in respect of the Class B Notes will be made without
withholding or 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
Class B Notes subject to any withholding or deduction for, or on account of, any
present or future taxes, duties or charges of whatsoever nature. In that event
the Issuer Trustee or that Paying Agent (as the case may be) shall make such
payment after such withholding or deduction has been made and 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 Class B Noteholders in respect of that withholding or
deduction.
8. PRESCRIPTION
A Class B 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 that Class B Note to
zero. After the date on which a Class B Note becomes void in its entirety, no
claim may be made in respect of it.
As used in these Conditions, 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 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 Class B
Condition 12.
9. EVENTS OF DEFAULT
Each of the following is an "Event of Default":
(a) the Issuer Trustee fails to pay:
(i) 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 or
holders of RFSs or holders of RFS Class A Notes, or
(ii) any other amount owing to Class A Noteholders, Class B Noteholders or
holders of RFSs or 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 Mortgagee or
where the Mortgagee is a Noteholder, with the Note Trustee).
(b) the Issuer Trustee fails to perform or observe any other provisions
(other than an obligation referred to in paragraph (a)) of a Transaction
Document (other than the Underwriting Agreement) where such failure will have a
material and adverse affect 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 to the 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 Offered Notes are 75% of the Secured Moneys) after written notice from
the Security Trustee requiring the failure to be remedied.
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(c) any of the following occurs in relation to the Issuer Trustee (in its
personal capacity or as Trustee of the Trust):
(i) an administrator of the Issuer Trustee is appointed; or
(ii) except for the purpose of a solvent reconstruction or amalgamation:
(A) an application or an order is made, proceedings are commenced, a
resolution is passed or proposed in a notice of meeting or an application to a
court or other steps (other than frivolous or vexatious applications,
proceedings, notices and steps) are taken for:
(1) the winding up, dissolution or administration of the Issuer Trustee; or
(2) the Issuer Trustee entering into an arrangement, compromise or
composition with or assignment for the benefit of its creditors or a class of
them; or
(B) the Issuer Trustee 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
(iii) the Issuer Trustee 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, where this
occurs in relation to another trust of which it is the trustee):
(iv) a receiver, receiver and manager or administrator is appointed (by the
Issuer Trustee or by any other person) to all or substantially all of the assets
and undertaking of the Issuer Trustee 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
(v) anything analogous to an event referred to in paragraphs (i) to (iv)
(inclusive) or having substantially similar effect, occurs with respect to the
Issuer Trustee;
(d) 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;
(e) any security interest over the Trust Assets is enforced;
(f) all or any part of any Transaction Document, other than the Redraw
Facility or the Basis Swap (each as defined in the Series Notice), 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 Redraw Facility or the Basis Swap);
or
(g) without the prior consent of the Security Trustee (that consent, in
accordance with the provisions of the Security Trust Deed, being subject 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
Relevant Documents, the Issuer Trustee ceases to be authorised under the Trust
to hold the property of the Trust in its name and to perform its obligations
under the Relevant Documents.
IN THE EVENT THAT THE SECURITY CONSTITUTED BY THE SECURITY TRUST DEED
BECOMES ENFORCEABLE FOLLOWING AN EVENT OF DEFAULT UNDER THE NOTES ANY FUNDS
RESULTING FROM THE REALISATION OF SUCH SECURITY SHALL BE APPLIED IN ACCORDANCE
WITH THE ORDER OF PRIORITY OF PAYMENTS AS STATED IN THE SECURITY TRUST DEED.
III-17
<PAGE>
10. ENFORCEMENT
(a) At any time after an Event of Default occurs, the Security Trustee may,
with the prior written consent of the Note Trustee in accordance with the
provisions of the Security Trust Deed and shall, if so directed by (a) the Note
Trustee alone, where the Note Trustee is the only Voting Mortgagee, or otherwise
(b) an Extraordinary Resolution (being 75% of votes capable of being cast by
Voting Mortgagees present or in person or by proxy of the relevant meeting or a
written resolution signed by all Voting Mortgagees) of the Voting Mortgagees
(which includes the Note Trustee on behalf of Noteholders, but not the
Noteholders themselves), declare the Class B Notes immediately due and payable
and enforce the Security Trust Deed. If an Extraordinary Resolution of Voting
Mortgagees referred to in sub-paragraph (b) above elects not to direct the
Security Trustee to enforce the Security Trust Deed, in circumstances where the
Security Trustee could enforce, the Note Trustee may nonetheless, and shall at
the direction of the Class B Noteholders, direct the Security Trustee to enforce
the Security Trust Deed on behalf of the Noteholders.
"Voting Mortgagee" means:
(a) for so long as the amounts outstanding under the Class A Notes and the
Class B Notes are 75% or more of all amounts secured by the Security Trust Deed,
the Note Trustee alone; and
(b) 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 chargees except as provided in the Security Trust Deed.
(b) If any of the Class B Notes remains outstanding and are due and payable
otherwise than by reason of a default in payment of any amount due on the Class
B 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 realised to discharge in full all amounts
owing to the Class B Noteholders and any other amounts payable by the Issuer
Trustee ranking in priority to or PARI PASSU with the Class B 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
(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).
(c) Neither the Note Trustee nor the Security Trustee will be liable for any
decline in the value, nor any loss realised 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
III-18
<PAGE>
Trustee or the Class B 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.
(d) 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 B Notes, unless directed or requested to do so by Noteholders holding
at least 75% of the aggregate Invested Amount of Class A Notes or Class B Notes
(as the case may be) at the time 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.
(e) So long as any of the Class A Notes remains outstanding, the Note
Trustee shall not, and shall not be bound to, act at the request or direction of
the Class B Noteholders under paragraph (d) unless (i) so to do would not in its
opinion be materially prejudicial to the interests of the Class A Noteholders;
(ii) the relevant action is sanctioned by way of written approval of Class A
Noteholders holding at least 75% of the aggregate Invested Amount of Class A
Notes at the time; or (iii) in the case of giving notice pursuant to Condition
10 of the Class B Conditions, the Class A Notes are all then repayable in full.
(f) Only the Security Trustee may enforce the provisions of the Security
Trust Deed and neither the Note Trustee nor any holder of a Class B 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 B
Notes (including these Class B Conditions).
(g) The rights, remedies and discretions of the Class B 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 B
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 B 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 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 (AS DEFINED IN THE MASTER TRUST DEED) AND PAYABLE
TO THE LIQUIDITY FACILITY PROVIDER (AS DEFINED IN THE MASTER TRUST DEED) AND THE
PROCEEDS OF CASH COLLATERAL LODGED WITH AND PAYABLE TO A SWAP PROVIDER OR OTHER
PROVIDER OF A SUPPORT FACILITY (AS DEFINED IN THE MASTER TRUST DEED)) WILL BE
APPLIED IN THE ORDER OF PRIORITY AS SET OUT IN THE SECURITY TRUST DEED. ANY
CLAIMS OF NOTEHOLDERS REMAINING AFTER REALISATION OF THE SECURITY AND
APPLICATION OF THE PROCEEDS AS AFORESAID SHALL, EXCEPT IN CERTAIN LIMITED
CIRCUMSTANCES, BE EXTINGUISHED.
11. REPLACEMENTS OF CLASS B NOTES
If any Class B Note is lost, stolen, mutilated, defaced or destroyed, it may
be replaced at the specified office of the Principal Paying Agent upon payment
by the claimant of the expenses incurred in connection with that replacement and
on such terms as to evidence and indemnity as the Issuer Trustee may reasonably
require. Mutilated or defaced Class B Notes must be surrendered before
replacements will be issued.
III-19
<PAGE>
12. NOTICES
All notices, other than notices given in accordance with the following
paragraph, to Class B Noteholders shall be deemed given if in writing and
mailed, first-class, postage prepaid to each Class B Noteholder, at his or her
address as it appears on the Note Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice. In
any case where notice to Class B Noteholders is given by mail, neither the
failure to mail such notice nor any defect in any notice so mailed to any
particular Class B Noteholder shall affect the sufficiency of such notice with
respect to other Class B Noteholders, and any notice that is mailed in the
manner herein provided shall conclusively be presumed to have been duly given.
A notice may be waived in writing by the relevant Class B Noteholder, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Class B Noteholders shall be filed with the Note
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
Any such notice shall be deemed to have been given on the date such notice
is deposited in the mail.
In case, by reason of the suspension of regular mail services as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Class B Noteholders when such notice is required to be
given, then any manner of giving such notice as the Trustee shall direct the
Note Trustee shall be deemed to be a sufficient giving of such notice.
Any notice specifying a Payment Date, an Interest Rate, Interest payable, a
Principal Payment (or the absence of a Principal Payment), an Invested Amount, a
Stated Amount or a Bond Factor shall be deemed to have been duly given if the
information contained in such notice appears on the relevant page of the Reuters
Screen or such other similar electronic reporting service as may be approved by
the Note Trustee and notified to Class B Noteholders (the "Relevant Screen").
Any such notice shall be deemed to have been given on the first date on which
such information appeared on the Relevant Screen. If it is impossible or
impracticable to give notice in accordance with this paragraph then notice of
the matters referred to in this Condition shall be given in accordance with the
preceding paragraph.
The Principal Paying Agent shall deliver a quarterly servicing report for
each Collection Period to each Class B Noteholder on the Notice Date relating to
such Collection Period in the method provided in the first paragraph of this
Condition 12.
13. MEETINGS OF VOTING MORTGAGEES AND VOTES 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 the Class A Noteholders to
consider any matter affecting their interests. In general, the holders of a
majority of the aggregate Invested Amount of the Class A Notes may take or
consent to any action permitted to be taken by Class A Noteholders under the
Note Trust Deed. Notwithstanding the foregoing, the consent of holders of 75% of
the aggregate Invested Amount of
III-20
<PAGE>
the Class A Notes shall be required to (i) direct the Note Trustee to direct the
Security Trustee to enforce the security under the Note Trust Deed, (ii)
override any waiver by the Note Trustee of a breach of any provisions of the
Transaction Documents or an Event of Default, (iii) alter, add, or modify the
terms and conditions of the Class A Notes or the provisions of any of the
Transaction Documents if such alteration, addition or modification is, in the
opinion of the Note Trustee, materially prejudicial or likely to be materially
prejudicial to the Offered Noteholders as a whole or the Class A Noteholders,
which shall include any modification to 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 percentage of the
aggregate Invested Amount required to consent to any action 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"). 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 that would be materially
prejudicial to the interests of the Class A Noteholders. Except in certain
circumstances, the Note Trust Deed imposes no such limitations on the powers of
the Class A Noteholders, the exercise of which will be binding on the Class B
Noteholders, irrespective of the effect on the Class B Noteholders' interests.
Any action taken by the requisite percentage of the Invested Amount of the Class
A Noteholders shall be binding on all Class A Noteholders (both present and
future).
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
authorisation of any breach or proposed breach of the Class B Notes (including
these 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
B Noteholders or (ii) to any modification of the Class B Notes (including these
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 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,
authorisation 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 in accordance with Class B Condition 12 as
soon as practicable thereafter.
14. INDEMNIFICATION AND EXONERATION OF THE NOTE TRUSTEE AND THE SECURITY TRUSTEE
The Note Trust Deed contains provisions for the indemnification of the Note
Trustee and for its relief from responsibility, including provisions relieving
it from taking proceedings to realise the security and to obtain repayment of
the Class B Notes unless indemnified to its satisfaction. Each of the Note
Trustee and the Security Trustee is entitled to enter into business transactions
with the Issuer Trustee and/or any other party to the Relevant Documents without
accounting for any profit resulting from such transactions. Neither the Security
Trustee nor the Note Trustee will be responsible for any loss, expense or
liability which may be suffered as a result of any assets secured by the
Security Trust Deed, Mortgaged Property or any deeds or documents of title
thereto, being uninsured or inadequately insured or being held by or to the
order of the Servicer or any of its affiliates or by clearing organisations or
their operators or by any person on behalf of the Note Trustee.
15. LIMITATION OF LIABILITY OF THE ISSUER TRUSTEE
(A) GENERAL
Clause 33 of the Master Trust Deed applies to the obligations and
liabilities of the Issuer Trustee in relation to this Class B Note.
III-21
<PAGE>
(B) LIABILITY OF TRUSTEE LIMITED TO ITS RIGHT OF INDEMNITY
(i) This Class B Note applies to the Issuer Trustee only in its capacity as
trustee of the Trust and in no other capacity. A liability arising under or in
connection with this Class B Note or the Trust 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 this Class B Note or any other Transaction Document 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 this Class B Note or the Trust.
(ii) None of the Note Trustee or the Class B Noteholders may take action
against the Issuer 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 Issuer Trustee or
prove in any liquidation, administration or arrangements of or affecting the
Issuer Trustee.
(iii) The provisions of this Condition 15 shall not apply to any obligation
or liability of the Issuer 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 Issuer Trustee's indemnification out of the Trust Assets as
a result of the Issuer Trustee's fraud, negligence or breach of trust.
(iv) It is acknowledged that the Trust Manager, the Servicer, each Paying
Agent, the Agent Bank and the Note Trustee (each a "Relevant Party") are
responsible under the Transaction Documents for performing a variety of
obligations relating to the Trust. No act or omission of the Issuer Trustee
(including any related failure to satisfy its obligations under this Class B
Note or a Transaction Document) will be considered fraud, negligence or breach
of trust of the Issuer Trustee for the purpose of sub-paragraph (iii) of this
Condition 15 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 Issuer Trustee and for whom the Issuer Trustee is
responsible under the Transaction Documents, other than a 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 Issuer
Trustee and for whom the Issuer Trustee is responsible under the Transaction
Documents, other than a Relevant Party).
(v) No attorney, agent, receiver or receiver and manager appointed in
accordance with a Transaction Document (including without limitation a Relevant
Party) has authority to act on behalf of the Issuer Trustee in a way which
exposes the Issuer 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
Issuer Trustee for the purpose of sub-paragraph (iii), if the Issuer Trustee has
exercised reasonable care in the selection and supervision of such a person.
16. GOVERNING LAW
The Class B Notes and the Relevant Documents (other than the Security Trust
Deed which is governed by the laws of the Australian Capital territory and the
Currency Swap with Morgan Guaranty Trust Company of New York, London Office,
which is governed by the laws of England) are governed by, and shall be
construed in accordance with, the laws of New South Wales, Australia.
SUMMARY OF PROVISIONS RELATING TO THE CLASS B NOTES WHILE IN BOOK-ENTRY FORM
Each of the Class B Notes will initially be represented by a typewritten
book-entry note (the "Book-Entry Class B Note"), without coupons, in the
principal amount of US$ . The Book-Entry Class B Note will be deposited
with the Common Depositary for DTC on or about the Closing Date. Upon
III-22
<PAGE>
deposit of the Book-Entry Class B Note with the Common Depositary, DTC will
credit each investor in the Class B Notes with a principal amount of Class B
Notes for which it has subscribed and paid.
The Book-Entry Class B Note will be exchangeable for definitive Class B
Notes in certain circumstances described below.
Each person who is shown in the Note Register as the holder of a particular
principal amount of Class B Notes will be entitled to be treated by the Issuer
Trustee and the Note Trustee as a holder of such principal amount of Class B
Notes and the expression "Class B Noteholder" shall be construed accordingly,
but without prejudice to the entitlement of the holder of the Book-Entry Class B
Note to be paid principal and interest thereon in accordance with its terms.
Such persons shall have no claim directly against the Issuer Trustee in respect
of payment due on the Class B Notes for so long as the Class B Notes are
represented by a Book-Entry Class B Note and the relevant obligations of the
Issuer Trustee will be discharged by payment to the registered holder of the
Book-Entry Class B Note in respect of each amount so paid.
(A) PAYMENTS
Interest and principal on each Global Class B Note will be payable by the
Common Depositary to the Principal Paying Agent provided that:
(i) no payment of interest may be made by the Issuer Trustee or any Paying
Agent in the United States of America or the Commonwealth of Australia or their
possessions or into a bank account or to an address in the United States or the
Commonwealth of Australia or their possessions, and
Each of the persons appearing from time to time as the holder of a Class B
Note will be entitled to receive any payment so made in respect of that Class B
Note in accordance with the respective rules and procedures of DTC. Such persons
will have no claim directly against the Issuer Trustee in respect of payments
due on the Class B Notes which must be made by the holder of the relevant
Book-Entry Class B Note, for so long as such Book-Entry Class B Note is
outstanding.
A record of each payment made on a Book-Entry Class B Note, distinguishing
between any payment of principal and any payment of interest, will be recorded
in the Note Register by the Principal Paying Agent, and such record shall be
prima facie evidence that the payment in question has been made.
(B) EXCHANGE
The Book-Entry Class B Note will be exchangeable for definitive Class B
Notes only if:
(a) the Trust Manager advises the Principal Paying Agent in writing that the
Clearing Agency is no longer willing or able properly to discharge its
responsibilities with respect to the Class A Notes or the Clearing Agency
carry on business, and the Trust Manager is unable to locate a qualified
successor;
(b) the Issuer Trustee, at the direction of the Trust Manager (at the Trust
Manager's option) advises the Principal Paying Agent in writing that the
book entry system through the Clearing Agency is or is to be terminated;
or
(c) after the occurrence of an Event of Default, the Class A Note Owner's
representing beneficial interests aggregating to at least a majority of
the aggregate Invested Amount of the Class A Notes advise the Principal
Paying Agent and Issuer Trustee through the Clearing Agency in writing
that the continuation of a book entry system through the Clearing Agency
is no longer in the best interests of the Note Owners,
then the Principal Paying Agent shall notify all Class A Note Owners and the
Issuer Trustee of the occurrence of any such event and of the availability of
Definitive Notes to Class A Note Owners requesting
III-23
<PAGE>
the same. Upon the surrender of the Book-Entry Notes to the Issuer Trustee by
the Clearing Agency, and the delivery by the Clearing Agency of the relevant
registration instructions to the Issuer Trustee, the Issuer Trustee shall
execute and authenticate the Definitive Notes in accordance with the
instructions of the Clearing Agency.
(C) NOTICES
So long as the Notes are represented by the Global Class B Note and the same
is/are held on behalf of DTC, notices to Class B Noteholders may be given by
delivery of the relevant notice to DTC for communication by them to entitled
account holders in substitution for delivery to each Class B Noteholder as
required by the Class B Conditions.
(D) CANCELLATION
Cancellation of any Class B Note required by the Class B Conditions will be
effected by reduction in the principal amount of the relevant Book-Entry Class B
Note.
III-24
<PAGE>
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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 NOTES OFFERED HEREBY, NOR AN OFFER OF
THE OFFERED NOTES 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.......................... 44
Security for the Notes.......................... 45
The Trust Fund.................................. 51
The Issuer Trustee.............................. 60
The Note Trustee................................ 65
Originator of the Housing Loans................. 66
The Servicer.................................... 66
The Trust Manager............................... 70
Westpac Residential Loan Program................ 73
The Mortgage Insurance Policies................. 77
Prepayment and Yield Considerations............. 84
Description of the Offered Notes................ 88
Description of the Servicing Agreement.......... 124
The Liquidity Facility.......................... 130
Description of the Swap Agreements.............. 133
Currency Swap Providers......................... 137
Certain Legal Aspects of the Housing Loans...... 138
Use of Proceeds................................. 144
United States Federal Income Tax Consequences... 144
Certain Australian Tax Matters.................. 146
ERISA Considerations............................ 148
Ratings of the Notes............................ 149
Legal Investment Considerations................. 149
Underwriting.................................... 149
Listing and General Information................. 151
Legal Matters................................... 153
Index of Defined Terms.......................... 154
Appendix I--Glossary of Australian Legal
Terms.......................................... I-1
Appendix II--Terms and Conditions of the Class A
Notes.......................................... II-1
Appendix III--Terms and Conditions of the Class
B Notes........................................ III-1
</TABLE>
US$
(APPROXIMATE)
WESTPAC SECURITIES
ADMINISTRATION LIMITED
IN ITS CAPACITY AS ISSUER 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
---------------------
PROSPECTUS
---------------------
J.P. MORGAN & CO.
MORGAN STANLEY DEAN WITTER
WESTPAC BANKING CORPORATION
DEUTSCHE MORGAN GRENFELL
MERRILL LYNCH & CO.
SBC WARBURG DILLON READ
MAY , 1998
- -------------------------------------------
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- -------------------------------------------
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<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.
Under certain limited circumstances, the Issuer Trustee may issue certain
additional securities, the RFSs, which in certain circumstances will convert to
RFS Class A Notes. The RFSs will be senior in priority of distributions of
principal to the Class A Notes and the RFS Class A Notes (except with respect to
enforcement, in which case such classes will be PARI PASSU) and senior in
priority of distributions of principal and interest to the Class B 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 and senior in priority of
distributions of principal and interest to the Class B Notes. The RFSs and RFS
Class A Notes are not offered hereby. See "SUMMARY OF TERMS--Redraws, RFSs and
RFS Class A Notes."
(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(1)
<S> <C> <C> <C>
Class A Notes...................................... % % %
Class B Notes...................................... % % %
Total.............................................. US$ US$ US$
</TABLE>
(1) 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 (which includes 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 and
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 June 9, 1998
against payment therefor in immediately available funds.
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.
Pursuant to Section 109 of the Articles of Association of the Registrant:
(1) To the extent permitted by law and without limiting the powers of the
Registrant, the Registrant must indemnify each person who is, or has been, a
director or secretary of the Registrant 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 Registrant or
any of its subsidiaries or in the capacity of an employee of the Registrant
or any of its subsidiaries:
(a) to any person (other than the Registrant 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 favor 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 Corporations Law and the Corporations
Regulations of Australia.
(2) The Registrant 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
Registrant, the board of directors may authorize the Registrant to, and the
Registrant may enter into any:
(a) documentary indemnity in favor 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 Registrant or of a subsidiary of the Registrant, which
indemnity or insurance policy may be in such terms as the
II-1
<PAGE>
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; and
(4) The benefit of each indemnity given in paragraph (1) of Section 109
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.
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 of the Registrant.**
4.1 Master Trust Deed.**
4.2 Form of the Series Notice.*
4.3 Form of the Note Trust Deed.*
4.4 Form of the Security Trust Deed.**
5.1 Opinion of Mayer, Brown & Platt as to legality of the Offered Notes.
8.1 Opinion of Mayer, Brown & Platt as to certain tax matters (included in Exhibit 5.1
hereof).
8.2 Opinion of Allen Allen & Hemsley as to certain tax matters.
10.1 The Servicing Agreement.**
10.2 Form of Servicing Agreement Amendment Agreement.**
10.3 Form of the Liquidity Facility Agreement.**
10.4 Form of the Redraw Facility Agreement.**
10.5 Form of the Currency Swap (Westpac and Issuer Trustee).*
10.6 Form of the Currency Swap (Morgan Guaranty and Issuer Trustee).*
10.7 Form of Interest Rate Swaps.*
23.1 Consent of Mayer, Brown & Platt (included in Exhibit 5.1 hereof).
23.2 Consent of Allen Allen & Hemsley (included in Exhibit 8.2 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.
II-2
<PAGE>
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.
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. 3 to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Sydney, Australia, on the 26th 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. 3 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 26, 1998
- ------------------------------ and Director
R. Patrick Handley
*MARTEN TOUW Principal Financial Officer May 26, 1998
- ------------------------------ and Director
Marten Touw
/s/ LUCY BERETIN Principal Accounting May 26, 1998
- ------------------------------ Officer
Lucy Beretin
*KIMBERLEY GIRE Director May 26, 1998
- ------------------------------
Kimberley Gire
/s/ LEWIS E. LOVE, JR. Director May 26, 1998
- ------------------------------
Lewis E. Love, Jr.
*PHIL CHRONICAN Director May 26, 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. 3 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 of the Registrant.**
4.1 Master Trust Deed.**
4.2 Form of the Series Notice.*
4.3 Form of the Note Trust Deed.*
4.4 Form of the Security Trust Deed.**
5.1 Opinion of Mayer, Brown & Platt as to legality of the Offered Notes.
8.1 Opinion of Mayer, Brown & Platt as to certain tax matters (included in Exhibit 5.1 hereof).
8.2 Opinion of Allen Allen & Hemsley as to certain tax matters.
10.1 The Servicing Agreement.**
10.2 Form of the Servicing Agreement Amendment Agreement.**
10.3 Form of the Liquidity Facility Agreement.**
10.4 Form of the Redraw Facility Agreement.**
10.5 Form of the Currency Swap (Westpac and Issuer Trustee).*
10.6 Form of the Currency Swap (Morgan Guaranty and Issuer Trustee).*
10.7 Interest Rate Swaps.*
23.1 Consent of Mayer, Brown & Platt (included in Exhibit 5.1 hereof).
23.2 Consent of Allen Allen & Hemsley (included in Exhibit 8.2 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 5.1
[Mayer, Brown & Platt Letterhead]
May 26, 1998
Westpac Securitisation Management Pty Limited
Level 5, 60 Martin Place
Sydney, NSW 2000, Australia
Ladies and Gentlemen:
We have acted as your counsel in connection with the preparation of the
Registration Statement on Form S-11 (the "Registration Statement"), and the
Prospectus forming a part thereof (the "Prospectus"), filed by you with the
Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act") relating to the Notes (as defined below).
The Registration Statement and the Prospectus relate to the offer and sale
of the Class A and Class B Mortgage Backed Floating Rate Notes (the "Notes")
to be issued by Westpac Securities Administration Limited pursuant to the
terms of the Master Trust Deed, the Notice of Creation of Trust, the Series
Notice, the direction from the Trust Manager to the Issuer Trustee to issue
the Notes, the Note Trust Deed, the Terms and Conditions of the Notes and the
Agency Agreement (collectively, the "Documents") as described in the
Registration Statement. The Master Trust Deed and forms of the other
Documents are included as exhibits to the Registration Statement. We have
examined the Registration Statement, the Prospectus and such other documents
as we have deemed necessary or advisable for purposes of rendering this
opinion. Additionally, our advice has formed the basis for the description
of the selected Federal income tax consequences of the purchase, ownership
and disposition of the Notes to an original purchaser who is subject to
United States Federal income tax that appears under the heading "United
States Federal Income Tax Consequences" in the Prospectus (the "Tax
Description"). Except as otherwise indicated herein, all terms defined in
the Prospectus are used herein as so defined.
<PAGE>
Westpac Securitisation Management Pty Limited
May 26, 1998
Page 2
We have assumed for the purposes of the opinions set forth below that the
Notes will be issued as described in the Registration Statement and that the
Notes will, at your direction, be sold by Westpac Securities Administration
Limited for reasonably equivalent consideration. We have also assumed that
the Documents and the Notes will be duly authorized by all necessary
corporate action and that the Notes will be duly issued, executed,
authenticated and delivered in accordance with the provisions of the
Documents. In addition, we have assumed that the parties to each Document
will satisfy their respective obligations thereunder.
With respect to the opinion set forth in paragraph 1 of this letter, we
have relied, without independent investigation, on the opinion of Mallesons
Stephen Jaques to be dated on or about the Closing Date as to those matters
concerning the laws of New South Wales, Victoria, Western Australia,
Queensland, the Australian Capital Territory and the Commonwealth of
Australia.
The opinion set forth in paragraph 2 of this letter is based upon the
applicable provisions of the Internal Revenue Code of 1986, as amended,
Treasury regulations promulgated and proposed thereunder, current positions
of the Internal Revenue Service (the "IRS") contained in published Revenue
Rulings and Revenue Procedures, current administrative positions of the IRS
and existing judicial decisions. This opinion is subject to the explanations
and qualifications set forth under the caption "United States Federal Income
Tax Consequences" in the Prospectus. No tax rulings will be sought from the
IRS with respect to any of the matters discussed herein.
On the basis of the foregoing examination and assumptions, and upon
consideration of applicable law, it is our opinion that:
1. When each of the Documents has been duly and validly completed,
authorized, executed and delivered by each and every party thereto
substantially in the form filed as an exhibit to the Registration Statement
and the Notes have been duly executed, authenticated, delivered and sold as
contemplated in the Registration Statement, such Notes will be legally and
validly issued and binding obligations of the Issuer Trustee in its capacity
as trustee of the Trust.
2. While the Tax Description does not purport to discuss all possible
Federal income tax ramifications of the purchase, ownership, and disposition
of the Notes, particularly to U.S. purchasers subject to special rules under
the Internal Revenue Code of 1986, it constitutes, in all material respects,
a fair and accurate summary of such U.S. Federal income tax consequences
under present U.S. Federal income tax law. There can be no assurance,
however, that the tax conclusions presented therein will not be successfully
challenged by the IRS, or significantly
<PAGE>
Westpac Securitisation Management Pty Limited
May 26, 1998
Page 3
altered by new legislation, changes in IRS positions or judicial decisions,
any of which challenges or alterations may be applied retroactively with
respect to completed transactions.
We hereby consent to the filing of this letter as an exhibit to the
Registration Statement and to the references to this firm under the heading
"Legal Matters" in the Prospectus, without admitting that we are "experts"
within the meaning of the Act or the rules and regulations of the Commission
issued thereunder, with respect to any part of the Registration Statement,
including this exhibit.
Very truly yours,
/s/ Mayer, Brown & Platt
MAYER, BROWN & PLATT
<PAGE>
Exhibit 8.2
[LETTERHEAD OF ALLEN ALLEN & HEMSLEY]
26 May 1998
Westpac Securitisation Management Pty Limited
Level 5
60 Martin Place
SYDNEY NSW 2000
Dear Sirs
WESTPAC SECURITISATION TRUST
SERIES 1998-1G WST TRUST
We have acted for Westpac Securitisation Management Pty Limited (WSM) in
connection with the Series 1998-1G WST Trust (the TRUST) constituted under the
Master Trust Deed (the MASTER TRUST DEED) dated 14 February 1997 between Westpac
Securities Administration Limited (the TRUSTEE) and The Mortgage Company Pty
Limited, to which WSM has acceded as trust manager with respect to the Trust.
Definitions in the Prospectus (defined below) apply in this opinion but RELEVANT
JURISDICTION means the Commonwealth of Australia or New South Wales. No
assumption or qualification in this opinion limits any other assumption or
qualification in it.
1. DOCUMENTS
We have examined the following draft documents:
(a) the Master Trust Deed;
(b) the Notice of Creation of Trust for the Trust;
(c) the Series Notice;
(d) the Note Trust Deed between WSM, the Trustee and the Note Trustee;
(e) the Note Issue Direction for the Trust;
(f) the Agency Agreement between, among others, WSM, the Trustee; and
<PAGE>
ALLEN ALLEN & HEMSLEY Page 2
- --------------------------------------------------------------------------------
(g) a copy of the Prospectus as filed with the Securities and Exchange
Commission (the COMMISSION) under the US Securities Act of 1933 (the
PROSPECTUS).
2. ASSUMPTION
For the purposes of giving this opinion we have assumed that where a document
has been submitted to us in draft form it will be executed in the form of that
draft.
3. QUALIFICATIONS
Our opinion is subject to the following qualifications.
(a) We express no opinion as to any laws other than the laws of each Relevant
Jurisdiction as in force at the date of this opinion and, in particular we
express no opinion as to the laws of England or the United States.
(b) Our opinion is subject to the explanations and qualifications set forth
under the caption "Certain Australian Tax Matters" in the Prospectus. We
have also relied on an advance opinion from the Australian Taxation Office
in relation to a previous issue by the Trustee and confirmation provided to
Westpac by the Australian Taxation Office that the advance opinion applies
to the issue of the Offered Notes. No tax rulings will be sought from the
Australian Taxation Office with respect to the Trust for any of the matters
referred to in this opinion.
4. OPINION
Based on the assumptions and subject to the qualifications set out above we are
of the opinion that while the section entitled "Certain Australian Tax Matters"
in the Prospectus does not purport to discuss all possible Australian tax
ramifications of the purchase, ownership, and disposition of the Offered Notes,
it constitutes, in all material respects a fair and accurate summary of the
Australian taxation laws which would be relevant to holders of Offered Notes.
There can be no assurance, however, that the tax conclusions presented in that
Tax Description will not be successfully challenged by the Australian Taxation
Office, or significantly altered by new legislation, changes in Australian
Taxation Office positions or judicial decisions, any of which challenges or
alterations may be applied retroactively with respect to completed transactions.
We consent to the filing of this letter as an exhibit to the Registration
Statement on Form S-11 filed with the Prospectus, without admitting that we are
"experts" within the meaning of the Securities Act of 1933 of the rules and
regulations of the Commission issued under that Act with respect of any part of
the Registration Statement, including this exhibit.
Yours faithfully
/s/ Allen Allen & Hemsley
ALLEN ALLEN & HEMSLEY
<PAGE>
Exhibit 25.1
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
---------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
--------------------------------------------------
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5123346
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
60 Wall Street
New York, New York 10260-0060
(Address of principal executive offices) (Zip Code)
Rachael F. Robbins
General Counsel and Secretary
Morgan Guaranty Trust Company of New York
60 Wall Street
New York, New York 10260-0060
Tel: (212) 483-3535
(Name, address and telephone number of agent for service)
---------------------------------------------------------
Westpac Securities Administration Limited
in its capacity as Note Trustee of the Series 1998-1G WST Trust
(Exact name of obligor as specified in its charter)
Australia
(State or other jurisdiction of
incorporation or organization)
c/o Morgan Guaranty Trust
Company of New York, London Branch
60 Victoria Embankment
<PAGE>
London, United Kingdom EC4Y0JP
(Address of principal executive offices) (Zip Code)
-------------------------------------
Mortgage Backed Floating Rate Notes
(Title of the indenture securities)
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the Note Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York 12110.
Board of Governors of the Federal Reserve System, Washington, D.C., 20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York,
N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429. Bank of
England, Threadneedle Street, London EC2R8AH. The Securities and Futures
Authority, Cottons Center, Cottons Lane, London
SE12QB
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the Note Trustee, describe each such
affiliation.
None.
3
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect.
2. A copy of the Certificate of Authority of the Trustee to Commence
Business.
3. A copy of the authorization of the Trustee to exercise corporate Trust
powers.
4. A copy of the existing By-Laws of the Trustee.
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act.
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee,
Morgan Guaranty Trust Company of New York, a corporation organized and existing
under the laws of the State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York and State of New York, on the 26th day
of May, 1998
Morgan Guaranty Trust Company of New York,
Trustee
By /s/ Marne Lidster
--------------------
Marne Lidster
Vice President
5
<PAGE>
Exhibit 1
Charter
of
MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
<PAGE>
The undersigned, Secretary of Morgan Guaranty Trust Company of New York,
hereby certifies that attached hereto is a true and correct copy of the
Organization Certificate of said Company as amended to date.
---------------------------------
Date:
------------------------
<PAGE>
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C>
Act to incorporate New York Guaranty and Indemnity Company.............. 1
Act to amend the Charter of the New York Guaranty and Indemnity
Company................................................................ 3
Act to authorize the New York Guaranty and Indemnity Company to
accept and execute certain trusts...................................... 4
Order authorizing change of name ....................................... 5
Directors, Certificate of change of number.............................. 7
Certificate of increase of capital stock to $2,000,000.................. 10
Certificate of increase of capital stock to $3,000,000 ................. 13
Certificate of increase of capital stock to $5,000,000.................. 17
Certificate of increase of capital stock to $9,500,000.................. 21
Certificate of increase of capital stock to $10,000,000................. 25
Certificate of increase of capital stock to $20,000,000 ................ 29
Certificate of increase of capital stock to $25,000,000 ................ 33
Certificate of increase of capital stock to $30,000,000................. 37
Certificate of increase of capital stock to $40,000,000 ................ 41
Certificate of increase of capital stock to $70,000,000 ................ 47
Certificate of increase of capital stock to $90,000,000................. 51
Certificate of increase of capital stock to $100,000,000................ 55
Certificate of Amendment of Certificate of Incorporation, increasing
number of shares to 5,000,000 and decreasing par value to $20.......... 59
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Certificate of Amendment of Certificate of Incorporation,
increasing number of shares to 6,000,000 and the capital
stock to $120,000,000.................................................. 63
Certificate of Amendment of Certificate of Incorporation, changing name
to Morgan Guaranty Trust Company of New York, increasing the number of
shares to 7,540,000, increasing the capital stock to $188,500,000,
increasing the par value to $25 and adding a new provision empowering
the directors to adopt additional compensation plans.................... 67
Certificate of Amendment of Certificate of Incorporation, increasing
the number of shares to 8,294,000 and the capital stock to
$207,350,000............................................................ 75
Certificate of Amendment of the Organization Certificate, increasing
the number of shares to 9,123,400 and the capital stock to
$228,085,000............................................................ 79
Certificate of Amendment of the Organization Certificate, increasing
the number of shares to 9,500,000 and the capital stock to
$237,500,000............................................................ 82
Certificate of Amendment of the Organization Certificate, increasing
the number of shares to 10,000,000 and the capital stock to
$250,000,000............................................................ 85
Certificate of Amendment of the Organization Certificate, increasing
the number of shares to 12,500,000 shares, consisting of 2,500,000
shares of Preferred Stock of the par value of $100 per share and
10,000,000 shares of Common Stock of the par value of $25 per share,
and increasing the capital stock to $500,000,000........................ 88
Certificate of Amendment of the Organization Certificate, cancelling
and retiring 2,500,000 shares of Adjustable Rate Cumulative Preferred
Stock, Series A (par value $100 per share) and the restoration of such
shares to the status of authorized but unissued shares of
preferred stock......................................................... 98
Certificate of Amendment of the Organization Certificate, providing for
a change in the number of directors.................................... 109
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Certificate of Amendment of the Organization Certificate, increasing
the number of shares of Common Stock of the par value of $25 per
share to 11,000,000 and the authorized capital stock to
$525,000,000........................................................... 113
</TABLE>
<PAGE>
CHAP. 179
AN ACT
TO INCORPORATE THE
NEW YORK
GUARANTY AND INDEMNITY COMPANY.
BECAME A LAW APR. 13, 1864 WITH THE
APPROVAL OF THE GOVERNOR. PASSED, BY
A MAJORITY VOTE
The People of the State of New York, represented in Senate and Assembly do enact
as follows:
SECTION 1. James H. Weeks, Thomas Reed, Francis A. Murdock, Joel Wolfe, J.
Wesley Stark, Francis E. Pinto, and such other persons as may hereafter be
associated with them, and their successors are hereby constituted a body
corporate under the name of the NEW YORK GUARANTY AND INDEMNITY COMPANY, to be
located in the city of New York, and by that name shall have perpetual
succession and may sue and be sued in any court whatever with powers and
privileges as are hereinafter provided.
SECTION. 2. The capital stock of said company shall not exceed one
million of dollars in shares of one hundred dollars each, but when one
hundred thousand dollars shall have been actually subscribed and fifty
thousand dollars paid in cash, the said company may organize and proceed to
business under this act.
SECTION. 3. The said company shall have power to guaranty the payment,
punctual performance and collection of promissory notes, bills of exchange,
contracts, bonds, accounts, claims, rents annuities, mortgages, choses in
action, evidences of debt and certificates of property or value, and the titles
to property, real or personal, upon such terms as may be established by the
board of directors of said company, to receive upon storage, deposit, or
otherwise, merchandise, bullion, specie, plate, stocks, bonds, promissory notes,
certificates and evidences of debt, contracts or other property, and to take the
management, custody and charge of real or personal estate and property, and to
advance moneys, securities and credits upon any property, real or personal, on
such terms as may be established by the directors of said company.
SECTION. 4. The business and the corporate powers of said company shall be
exercised by a board of nine directors to be chosen as hereinafter provided, who
shall elect from their number a president, five of which directors shall
constitute a quorum for the transaction of business.
SECTION. 5. James H. Weeks, Francis A. Murdock, and Joel Wolfe, shall be and
they are hereby appointed commissioners to open books for subscription to the
capital stock of said company at such time and place as they, or a majority of
them shall deem proper, and for such amounts as in their judgment the business
of the company may require, but for no less amount of subscription than one
hundred thousand dollars as hereinbefore provided. The persons named in the
first
1
<PAGE>
section of this act shall be directors of said company for one year after the
passage of this act, and until others shall be elected in their stead, the
remaining directors for the same period shall be elected by a majority in
interest of the stockholders voting at an election to be held under the
inspection of said commissioners within twenty days from the closing of the
subscription called for by them, and all the directors must be stockholders in
said company.
SECTION. 6. It shall be lawful for said company to lease, purchase, hold
and convey all such real or personal estate as may be necessary to carry on
their business, as well as such real or personal estate as they may deem it
necessary to acquire in the enforcement or settlement of any claim or demand
arising out of their business transactions, and to sell or exchange the same
for other property as they may determine that the interests of the company
require, and the said company are hereby authorized to make, execute and
issue in the transaction of their business all necessary receipts,
certificates and contracts, which receipts, certificates and contracts shall
bear the impress or stamp of the seal of the company, and shall be signed by
the president and countersigned by the Secretary or treasurer thereof.
SECTION. 7. It shall be lawful for said company to sell at public auction or
private sale as may be specified in any contract between the parties, all
property of what kind soever mentioned in or affected by such contract after two
months shall have elapsed from the time of the maturity of any obligation under
such contract, (or immediately upon the discovery of any fraud,
misrepresentation or concealment in regard to the ownership, character of the
property mentioned in or affected by such contract), and reimburse themselves
out of the avails of such sale for the moneys due them, with the interest, cost
and charges; provided however that nothing in this, section contained shall be
construed to prevent the said company from making any such sale at such time and
in such manner as may be provided for in any contract or agreement made by any
person or persons with the said company.
SECTION. 8. In case any property deposited with the said company, upon which
any advance shall have been made by them shall before the maturity of the
contract from any cause decrease in value from the price originally fixed, said
company may give notice in writing to the owner of such property or his agent to
perform the conditions of the contract or make good the deficiency caused by
such decrease in value within thirty days, and in default thereof may sell and
dispose of such property at public sale, and out of the proceeds thereof may
retain the amount due them under the contract together with the costs, charges
and expenses. But nothing in this act contained shall be held or construed to
limit or affect, the liability or obligation of the corporation hereby created,
as the same is fixed by the common law or by statute, any further than the same
is limited or affected by the express terms of the contract in this section
mentioned.
SECTION. 9.*
SECTION. 10.*
SECTION. 11. This act shall take effect immediately.
*Deleted by Certificate of Amendment dated October 1, 1969.
2
<PAGE>
CHAP.20
AN ACT
TO AMEND THE CHARTER OF THE
NEW YORK
GUARANTY AND INDEMNITY COMPANY.
BECAME A LAW FEB. 10, 1865 WITH THE
APPROVAL OF THE GOVERNOR. PASSED,
THREE-FIFTHS BEING PRESENT.
The People of the State of New York, represented in Senate and Assembly, do
enact as follows:
SECTION. 1. Section four of the act entitled "An Act to incorporate the
New York Guaranty and Indemnity Company," passed April thirteenth eighteen
hundred and sixty four, is hereby amended so as to read as follows:
SECTION. 4. The business and corporate powers of said Company shall be
exercised by a board of directors consisting of such number of persons, not
less than nine and not exceeding twenty-one, as may be prescribed by the
by-laws of said company, to be elected annually by a majority in interest of
the stockholders voting at an election to be held at such time and place as
may be prescribed by the by-laws of said Company; and it shall be lawful for
the said Company, by a vote of two-thirds of said board of directors, with
the consent of three-fourths of the stockholders, to permit dealers with the
Company to participate in the profits of the business of the Company on such
terms as may be prescribed by the board of directors, and also to provide for
the issue of scrip for such profits, and how far such scrip shall be liable
for losses to be sustained by said company, and in what manner such scrip
shall be redeemed and paid off, provided that no dividend or payment by said
company to or on account of such scrip shall be made so as to impair the cash
capital of the said company.
SECTION. 2. It shall be lawful for said company to increase the amount of
its capital stock in the manner provided in and by sections twenty,
twenty-one and twenty-two, of the act entitled "An act to authorize the
formation of corporations for manufacturing, mining, mechanical or chemical
purposes" passed February seventeenth eighteen hundred and forty-eight.
SECTION. 3. This act shall take effect immediately.
3
<PAGE>
CHAP. 827 AN ACT
TO AUTHORIZE THE
NEW YORK
GUARANTY AND INDEMNITY COMPANY.
TO ACCEPT AND EXECUTE CERTAIN TRUSTS. BECAME A LAW APR. 28,1871 WITH THE
APPROVAL OF THE GOVERNOR. PASSED, BY A MAJORITY VOTE.
The People of the State of New York, represented in Senate and Assembly, do
enact as follows:
SECTION 1. The New York Guaranty and Indemnity Company is hereby authorized
and empowered to accept and execute any trust created by mortgage made by any
railroad or other corporation, to secure its bonds or other obligations lawfully
made or issued, and appointing such company trustee and to act as trustee in
respect to all matters embraced in such trust.
2. This act shall take effect immediately.
4
<PAGE>
ORDER AUTHORIZING CHANGE OF NAME
At a Special Term of the Supreme Court held at the County Court House, in
the City of New York, on the 3rd day of December 1895.
PRESENT:
HON. GEORGE P. ANDREWS,
Justice.
In the Matter of the application of the New York Guaranty and Indemnity }
Company for leave to change its name.
Upon reading the petition, heretofore filed, of the New York Guaranty and
Indemnity Company, a corporation having its principal business office in the
City of New York, for leave to change its name and to assume the name of
GUARANTY TRUST COMPANY OF NEW YORK, and upon reading and filing the approval of
the said petition by the Superintendent of Banks, and by the Superintendent of
Insurance, and upon filing the affidavits of David S. Owen and Morris Van Vliet
showing that notice of the application for this order has been published in the
New York Law Journal and in the New York Evening Post once a week for six
successive weeks prior to the said application, and the Court being satisfied
that this application has been made in pursuance of a resolution of the Board of
Directors of the said Company, and that the said petition is true, and that
there is no reasonable objection to the granting thereof; Now on motion of
Lawrence Godkin, attorney for the petitioner, it is
ORDERED, that the said petition be, and the same hereby is granted, that the
New York Guaranty and Indemnity Company be authorized to assume the name of
GUARANTY TRUST COMPANY OF NEW YORK, on and after the 2nd day of January, 1896,
upon filing a copy of this order and the papers upon which it is granted, with
the Clerk of the County of New York, within ten days from the date hereof, and
upon filing a certified copy of this order, within ten days from the entry
thereof, in the office of the Secretary of State, of the Superintendent of
Banks, and of the Superintendent of Insurance respectively. And it is further
ORDERED, that this order be published within ten days after the entry
thereof once in each week for four successive weeks in the New York Law Journal
a daily newspaper printed in the County of New York.
Enter
GEORGE P. ANDREWS
J.S.C.
[SEAL]
5
<PAGE>
[ENDORSED]
SUPREME COURT New York County.
In the Matter of the Application
of
Then New York Guaranty and Indemnity Company for
leave to change its name.
Certified Copy Order granting leave to change name to Guaranty Trust Company of
New York.
STATE OF NEW YORK, Office of SECRETARY OF STATE
Filed Dec. 5, 1895
ANDREW DAVIDSON
Deputy Secretary of State.
6
<PAGE>
CERTIFICATE TO PROVIDE THAT THE
NUMBER OF DIRECTORS OF
GUARANTY TRUST COMPANY
OF NEW YORK
BE NOT LESS THAN A STATED MINIMUM
NOR MORE THAN A STATED MAXIMUM
pursuant to Section Thirty-Five of the Stock Corporation Law.
We, the undersigned, being a Vice President and the Secretary, respectively,
of Guaranty Trust Company of New York, for the purpose of providing that the
number of its directors shall be not less that a stated minimum nor more that a
stated maximum, pursuant to Section thirty-five of the Stock Corporation Law of
the State of New York, hereby do make, subscribe, acknowledge and file this
certificate, stating as follows:
1. The name of the corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which it was originally incorporated was New York Guaranty
and Indemnity Company.
2. The corporation was created by a special law and has no certificate of
incorporation.
The chapter number and year of passage of such law is:
CHAPTER 179, LAWS OF 1864.
3. The number of directors previously authorized was not less than thirty
nor more than forty-five.
4. The number of directors hereafter shall be not less than fifteen nor more
than twenty-five.
Jas. L. O'Neill
Vice President, Guaranty Trust Company
of New York
Matthew T. Murray, Jr.
Secretary, Guaranty Trust Company of New York
7
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 17th day of January, 1934, before me personally came Jas. L. O'Neill
and Matthew T. Murray, Jr., to me known and known to me to be the persons
described in and who executed the foregoing certificate and they severally duly
acknowledged to me that they executed the same.
JAMES G. DUNNET
Notary Public, Nassau County
New York County Clerk's No. 364
New York County Register's No. 4-D-202
Commission expires March 30, 1934.
[NOTARIAL SEAL]
STATE OF NEW YORK }
COUNTY OF NEW YORK
JAS. L. O'NEILL AND MATTHEW T. MURRAY, JR., being severally sworn, depose
and say, and each for himself deposes and says:
1. That he, the said Jas. L. O'Neill, is a Vice President of, and he, the
said MATTHEW T. MURRAY, JR., is the Secretary of, Guaranty Trust Company of New
York.
2. That they have been authorized to execute and file the foregoing
certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of the said Guaranty Trust Company of
New York, entitled to vote thereon; and that such votes were cast at a
stockholders' meeting held on January 17, 1934, upon notice pursuant to section
forty-five of the Stock Corporation Law of the State of New York.
JAS. L. O'NEILL
MATTHEW T. MURRAY, JR..
Severally subscribed and sworn to before me this 17th day of January, 1934.
JAMES G. DUNNET
Notary Public, Nassau County
New York County Clerk's No. 364
New York County Register's No. 4-D-202
Commission expires March 30, 1934.
[NOTARIAL SEAL]
8
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT
In the Matter of proposed change
in the number of directors
of
GUARANTY TRUST COMPANY OF NEW YORK
I, CHARLES H. SCHOCH, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE of the change in number of directors of GUARANTY TRUST
COMPANY OF NEW YORK, located at No. 140 Broadway, in the Borough of Manhattan,
City of New York, from not less than thirty (30) nor more than forty-five (45),
the present number, to not less than fifteen (15) nor more than twenty-five
(25), in accordance with the provisions of Section 35 of the Stock Corporation
Law.
WITNESS, my hand and official seal at the City of Albany, this Seventeenth
day of January in the Year of our Lord one thousand nine hundred and
thirty-four.
CHAS H. SCHOCH
[SEAL] Deputy Superintendent of Banks
9
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $2,000,000
STATE OF NEW YORK } ss.:
CITY & COUNTY OF NEW YORK
We, the undersigned Samuel D. Babcock, Chairman and George G. Haven,
Secretary respectively of a special meeting of the Stockholders of the New York
Guaranty and Indemnity Company held for the purpose of increasing its Capital
Stock Do HEREBY CERTIFY that notice of this meeting stating the time, place and
object and the amount to which it is proposed to increase the Capital Stock,
signed by a majority of the Directors, was published once a week for at least
three successive weeks in the Daily New , a newspaper in the County of New York,
in which the principal business of the said Company is located. That the
following is a true copy of such notice:
[NOTARIAL SEAL]
"NOTICE
"TO THE STOCKHOLDERS OF THE
"NEW YORK GUARANTY AND INDEMNITY
"COMPANY
"GENTLEMEN--Please take notice that a special meeting of the Stockholders of
the New York Guaranty and Indemnity Company will be held in the office of the
Company at No. 52 Broadway, in the City of New York, on the 30th day of
September, 1891, at 12 o'clock M.; for the purpose of voting upon a proposition
approved by the Directors to increase the Capital Stock from its present amount
of one hundred thousand dollars ($100,000) consisting of one thousand shares
each of the par value of one hundred dollars, to the amount of two million
dollars ($2,000,000) to consist of twenty thousand shares each of the par value
of one hundred dollars ($100).
"Signed "SAMUEL D. BABCOCK
"G. G. HAVEN
"A majority of the "ADRIAN ISELIN, JR.
"Directors "WALTER R. GILLETTE
[NOTARIAL SEAL] "ROBERT GOELET"
That a copy of such notice was also duly mailed postage prepaid to every
Stockholder in such Company at his Post Office address at least three weeks
before the meeting.
That at the time and place specified in such notice Stockholders appeared in
person or by proxy representing at least two-thirds of all the shares of stock
of such Company and organized by choosing from their number one of the Directors
of said Company, namely, Samuel D.
10
<PAGE>
Babcock, the undersigned as Chairman, and George G. Haven, the undersigned, as
Secretary, respectively.
That upon motion a vote was taken of those present in person or by proxy
upon the following resolution:
"RESOLVED, That the Capital Stock of the New York Guaranty and Indemnity
Company be and it is hereby increased from the present amount thereof namely,
one hundred thousand dollars ($100,000) consisting of one thousand shares each
of the par value of one hundred dollars ($100) to the amount of two million
dollars ($2,000,000) to consist of twenty thousand shares each of the par value
of one hundred dollars ($100)."
That Stockholders owning eight hundred and ninety four (894) shares of
stock, being more than two-thirds of the stock of the corporation, voted in
favor of the said Resolution and no Stockholder voted against its adoption.
That a sufficient number of votes having been given in favor of the said
Resolution, the Resolution was declared duly adopted and the Capital Stock of
the said Company was increased as provided therein.
That the amount of Capital of the Corporation actually paid in is at the
present time one hundred thousand dollars ($100,000) and the entire amount of
the debts and liabilities of said corporation is Capital Stock only.
That the amount of the increased Capital Stock is two million dollars
($2,000,000).
IN WITNESS WHEREOF, we have made, signed, verified and acknowledged this
certificate in duplicate this 30 day of September, eighteen hundred and
ninety-one.
S. D. BABCOCK
Chairman
[NOTARIAL SEAL]
G. G. HAVEN
Secretary
STATE OF NEW YORK } ss.:
CITY & COUNTY OF NEW YORK
Samuel D. Babcock, Chairman, and George G. Haven, Secretary respectively of
the aforesaid meeting, each being for himself duly sworn do depose and say, that
they have read the foregoing certificate subscribed by them, that they know the
contents thereof and that the same is true.
[Notarial Seal]
11
<PAGE>
Sworn to before me this S. D. BABCOCK
30 day of September, 1891 } Chairman
H. Y. CUMMINS G. G HAVEN
Secretary
Notary Public for Kings County
Certificate filed in New York County
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
CITY & COUNTY OF NEW YORK
On this 30 day of September, 1891, before me personally came Samuel D.
Babcock and George G. Haven to me personally known and known to me to be the
persons described in and who made, signed, and verified the foregoing
certificate and each of them duly acknowledged that he had made, signed and
verified the same for the uses and purposes therein set forth.
H. Y. CUMMINS
[NOTARIAL Notary Public for Kings County
SEAL] Certificate filed in New York County
12
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $3,000,000.
The undersigned, Alexander J. Hemphill, Chairman, and Edgar C. Hebbard,
Secretary, respectively, of a special meeting of the Stockholders of Guaranty
Trust Company of New York, a domestic stock corporation, held for the purpose of
increasing its capital stock, do hereby certify as follows:
Prior to such meeting, a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week, for at least two successive weeks, in The
Sun and The New York Tribune, each a newspaper published in the county where the
principal business office of such corporation is located.
The following is a true copy of such notice:
New York, January 3, 1910
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK
YOU ARE HEREBY NOTIFIED, That, by direction of the Board of Directors
of the Guaranty Trust Company of New York, a special meeting of the Stockholders
to authorize the increase of the Capital Stock of the corporation in the amount
of $1,000,000 from $2,000,000 to $3,000,000 has been called and will be held at
the office of the corporation, 28 Nassau Street (Manhattan), New York, upon
Wednesday, January 19, 1910, at twelve o'clock noon.
By order of the Board of Directors.
A. J. HEMPHILL
President
E. C. HEBBARD
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
Stockholder of such corporation, at his last known post-office address, at least
two weeks before the meeting.
At the time and place specified in such notice, Stockholders appeared, in
person or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation, and organized said meeting by choosing from
their number the undersigned, Alexander J. Hemphill, as Chairman, and Edgar C.
Hebbard, as Secretary thereof.
The notice of the meeting and proof of the proper publishing and mailing
thereof was presented.
13
<PAGE>
Upon motion, a vote was then taken of those present in person or by proxy
upon the following resolution:
RESOLVED, That the Capital Stock of Guaranty Trust Company of New York, be
increased from the present amount thereof, to wit, two million dollars,
consisting of twenty thousand shares, each of the par value of one hundred
dollars, all heretofore authorized and actually issued and outstanding, to the
amount of three million dollars, to consist of thirty thousand shares, each of
the par value of one hundred dollars.
RESOLVED, That the Chairman and Secretary of this meeting be, and hereby
they are, authorized and directed to make, sign, verify and acknowledge
duplicate certificates of the proceedings of this meeting as required by
statute, and to submit the same to the Superintendent of Banks for his
endorsement thereon of his approval of such increase of Capital Stock, and
thereupon to cause one of such certificates to be filed and recorded in the
office of the Clerk of the County of New York, and a duplicate thereof in the
office of the Secretary of State, and to cause the same to be entered on the
minutes of the corporation, and to do all other acts and things that may be
necessary to comply with the provisions of law applicable to and regulating such
increase of Capital Stock.
Stockholders owning 18,466 shares of stock, being at least a majority of all
the stock of the corporation, voted in favor of such resolution; and
Stockholders owning no shares of stock voted against its adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolution was declared duly adopted.
The amount of Capital of said Corporation heretofore authorized is two
million dollars, and the proportion thereof actually issued is two million
dollars; and the amount of the Capital Stock, as increased, is three million
dollars.
The assets of the said corporation are at least equal to the debts and
liabilities and the Capital Stock as increased.
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in duplicate. Dated this 19th day of January, 1910.
A. J. HEMPHILL
Chairman
E. C. HEBBARD
Secretary
14
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
Alexander J. Hemphill, Chairman, and Edgar C. Hebbard, Secretary,
respectively, of the aforesaid meeting, being severally duly sworn, do depose
and say, and each for himself does depose and say, that he has read the
foregoing certificate subscribed by him, and knows its contents, and that the
same is true.
A. J. HEMPHILL
Sworn to before me, this } ss.: Chairman
19th day of January, 1910 E. C. HEBBARD
Secretary
[SEAL] James D. Hurd
Notary Public, No. 64 King's County, Certificate filed in New York
County, and N. Y. County Register's Office No. 537, Commission expires
30th March, 1910.
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 19th day of January, 1910, before me personally came Alexander J.
Hemphill, and Edgar C. Hebbard, each to me known, and known to me to be the
individuals described in and who executed the foregoing instrument or
certificate, and severally duly acknowledged to me that they executed the same.
JAMES D. HURD
Notary Public No. 64 King's County, Certificate filed in New York
County, and N. Y. County Register's Office No. 537.
[NOTARIAL Commission expires 30th March, 1910
SEAL]
STATE OF NEW YORK
BANKING DEPARTMENT
I HEREBY APPROVE of the increase of the capital stock of the GUARANTY TRUST
COMPANY OF NEW YORK from Two Million Dollars ($2,000,000) consisting of twenty
thousand shares of the par value of One hundred dollars each, to Three Million
Dollars ($3,000,000), consisting of thirty thousand shares of the par value of
one hundred dollars each, as set forth in the within certificate.
WITNESS my hand and the official seal of the Superintendent of Banks at the
City of Albany, this nineteenth day of January, in the year of our Lord one
thousand nine hundred and ten.
15
<PAGE>
GEORGE I. SKINNER
[SEAL] First Deputy Superintendent of Banks
16
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $5,000,000.
The undersigned, Alexander J. Hemphill, Chairman, and Edgar C. Hebbard,
Secretary, respectively, of a special meeting of the stockholders of GUARANTY
TRUST COMPANY OF NEW YORK, a domestic stock corporation, held for the purpose of
increasing its capital stock, do hereby certify as follows:
Prior to such meeting, a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week, for at least two successive weeks, in The
Sun and The New York Tribune, each a newspaper published in the county where the
principal business office of such corporation is located.
The following is a true copy of such notice:
New York, January 8, 1910
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK:
YOU ARE HEREBY NOTIFIED, That, by direction of the Board of Directors of
GUARANTY TRUST COMPANY OF NEW YORK, a Special Meeting of the Stockholders has
been called and will be held at the office of the corporation, 28 Nassau Street,
Borough of Manhattan, City of New York, upon Tuesday, January 25, 1910, at
twelve o'clock noon. The object of the meeting is to authorize the increase of
the capital stock of GUARANTY TRUST COMPANY OF NEW YORK to the sum of
$5,000,000; the amount of increase proposed being $2,000,000, if the
Stockholders at their meeting heretofore called shall have authorized the
increase heretofore proposed by the Board of Directors, but otherwise being
$3,000,000.
By order of the Board of Directors
ALEXANDER J. HEMPHILL
President
E. C. HEBBARD
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
stockholder of such corporation, at his last known post-office address, at least
two weeks before the meeting.
At the time and place specified in such notice, stockholders appeared, in
person or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation, and organized said meeting by choosing from
their number the undersigned, Alexander J. Hemphill, as Chairman, and Edgar C.
Hebbard, as Secretary thereof.
17
<PAGE>
The notice of the meeting and proof of the proper publishing and mailing
thereof were presented.
Upon motion, a vote was then taken of those present in person or by proxy
upon the following resolution:
RESOLVED, That the capital stock of GUARANTY TRUST COMPANY OF NEW YORK, be
increased from the present amount thereof, to wit, three million dollars,
consisting of thirty thousand shares, each of the par value of one hundred
dollars, to the amount of five million dollars, to consist of fifty thousand
shares, each of the par value of one hundred dollars.
RESOLVED, That the Chairman and Secretary of this meeting be, and hereby
they are, authorized and directed to make, sign, verify, and acknowledge
duplicate certificates of the proceedings of this meeting as required by
statute, and to submit the same to the Superintendent of Banks for his
endorsement thereon of his approval of such increase of capital stock, and
thereupon to cause one of such certificates to be filed and recorded in the
office of the Clerk of the County of New York, and a duplicate thereof in the
office of the Secretary of State, and to cause the same to be entered on the
minutes of the corporation, and to do all other acts and things that may be
necessary to comply with the provisions of law applicable to and regulating such
increase of capital stock.
Stockholders owning 27,193 shares of stock, being at least a majority of all
the stock of the corporation, voted in favor of such resolution; and
stockholders owning no shares of stock voted against its adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolution was declared duly adopted.
The amount of capital of said corporation heretofore authorized is three
million dollars, and the proportion thereof actually issued is Two million, nine
hundred and ninety thousand, eight hundred dollars; and the amount of the
capital stock, as increased, is five million dollars.
The assets of the said corporation are at least equal to the debts and
liabilities and the capital stock as increased.
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in duplicate. Dated this 25th day of January, 1910.
ALEXANDER J. HEMPHILL
Chairman
EDGAR C. HEBBARD
Secretary
18
<PAGE>
STATE OF NEW YORK
COUNTY OF NEW YORK
Alexander J. Hemphill, Chairman, and Edgar C. Hebbard, Secretary,
respectively, of the aforesaid meeting, being severally duly sworn, do depose
and say, and each for himself does depose and say, that he has read the
foregoing certificate subscribed by him, and knows its contents, and that the
same is true.
ALEXANDER J. HEMPHILL
Chairman
Sworn to before me, this EDGAR C. HEBBARD
Secretary
25th day of January, 1910
[SEAL]
JAMES D. HURD
Notary Public No. 64, King's County, Certificate filed in New York County,
and N. Y. County Register's office No. 537, Commission expires 30th March, 1910.
STATE OF NEW YORK
COUNTY OF NEW YORK
On this 25th day of January, 1910, before me personally came Alexander J.
Hemphill, and Edgar C. Hebbard, each to me known, and known to me to be the
individuals described in and who executed the foregoing instrument or
certificate, and severally duly acknowledged to me that they executed the same.
[NOTARIAL JAMES D. HURD
SEAL] Notary Public No. 64, King's County,
Certificate filed in New York County, and
N. Y. County Register's Office No. 537,
Commission expires 30th March, 1910.
19
<PAGE>
STATE OF NEW YORK
BANKING DEPARTMENT
I HEREBY APPROVE of the increase of the capital stock of the GUARANTY TRUST
COMPANY OF NEW YORK from three million dollars ($3,000,000) consisting of thirty
thousand shares of the par value of one hundred dollars each, to five million
dollars ($5,000,000) consisting of fifty thousand shares of the par value of one
hundred dollars each, as set forth in the within certificate.
WITNESS my hand and the official seal of the Superintendent of Banks at the
City of New York, this 25th day of January, in the year of our Lord one thousand
nine hundred and ten.
[SEAL] O. H. CHENEY,
Superintendent of Banks
20
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $9,500,000.
The undersigned, Alexander J. Hemphill, Chairman, and Edgar C. Hebbard,
Secretary, respectively, of a special meeting of the Stockholders of GUARANTY
TRUST COMPANY OF NEW YORK, a domestic stock corporation, held for the purpose,
among other things, of increasing its capital stock, do hereby certify as
follows:
Prior to such meeting, a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week, for at least two successive weeks, in The
New York Times and The Evening Post, each a newspaper published in the county
where the principal business office of such corporation is located.
The following is a true copy of such notice:
GUARANTY TRUST COMPANY OF NEW YORK
28 Nassau Street
LONDON OFFICE: 33 LOMBARD ST., E. C.
New York, September 12, 1912
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK
By direction of the Board of Directors of the GUARANTY TRUST COMPANY OF NEW
YORK, a Special Meeting of the Stockholders to authorize the increase of the
capital stock of the corporation in the amount of $4,500,000, viz., from
$5,000,000 to $9,500,000, and to determine the disposition of such increase, has
been called and will be held at the office of the corporation, 28 Nassau Street,
Borough of Manhattan, City of New York, upon Tuesday, October 1, 1912, at twelve
o'clock noon.
By order of the Board of Directors.
A. J. HEMPHILL
President
E. C. HEBBARD
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
Stockholder of such corporation, at his last known post-office address, at least
two weeks before the meeting.
21
<PAGE>
At the time and place specified in such notice, Stockholders appeared, in
person, or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation, and organized said meeting by choosing from
their number the undersigned, Alexander J. Hemphill, as Chairman, and Edgar C.
Hebbard, as Secretary thereof.
The notice of the meeting and proof of the proper publishing and mailing
thereof were presented.
Upon motion, a vote was then taken of those present in person or by proxy
upon the following Resolution:
RESOLVED, That the Capital Stock of GUARANTY TRUST COMPANY OF NEW YORK, be
increased from the present amount thereof, to wit, five million dollars,
consisting of fifty thousand shares, each of the par value of one hundred
dollars, all thereof having been heretofore authorized and actually issued, to
the amount of nine million five hundred thousand dollars, to consist of
ninety-five thousand shares, each of the par value of one hundred dollars.
RESOLVED, That the Chairman and Secretary of this meeting be, and hereby
they are, authorized and directed to make, sign, verify and acknowledge
duplicate certificates of the proceedings of this meeting as required by
statute, and to submit the same to the Superintendent of Banks for his
endorsement thereon of his approval of such increase of capital stock, and
thereupon to cause one of such certificates to be filed and recorded in the
office of the Clerk of the County of New York, and a duplicate thereof in the
office of the Secretary of State, and to cause the same to be entered on the
minutes of the corporation, and to do all other acts and things which may be
necessary to comply with the provisions of law applicable to and regulating such
increase of capital stock.
Stockholders owning 48,264 shares of stock, being at least a majority of all
the stock of the corporation, voted in favor of such resolutions; and
stockholders owning no shares of stock voted against their adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolutions were declared duly adopted.
The amount of the capital stock of said corporation heretofore authorized is
five million dollars, and the proportion thereof actually issued is five million
dollars; and the amount of the capital stock, as increased, is nine million five
hundred thousand dollars.
The assets of the said corporation are at least equal to its debts and
liabilities and the capital stock as increased.
22
<PAGE>
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in duplicate. Dated this 1st day of October, 1912.
A.J. HEMPHILL
Chairman
E. C. HEBBARD
Secretary
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
Alexander J. Hemphill, Chairman, and Edgar C. Hebbard, Secretary,
respectively, of the aforesaid meeting, being severally duly sworn, do depose
and say, and each for himself does depose and say, that he has read the
foregoing certificate subscribed by him, and knows its contents, and that the
same is true.
A. J. HEMPHILL
Chairman
Sworn to before me, this } E, C. HEBBARD
1st day of October, 1912 Secretary
Wm. H. BRUDER
Notary Public
[NOTARIAL New York County No. 165
SEAL] N. Y. Register No. 3074
STATE OF NEW YORK }
COUNTY OF NEW YORK
On this 1st day of October, 1912, before me personally came Alexander J.
Hemphill, and Edgar C. Hebbard, each to me known, and known to me to be the
individuals described in and who executed the foregoing instrument or
certificate, and severally duly acknowledged to me that they executed the same.
Wm. H. BRUDER
Notary Public
[NOTARIAL New York County No. 165
SEAL] N. Y. Register No. 3074
STATE OF NEW YORK }
BANKING DEPARTMENT
23
<PAGE>
I HEREBY APPROVE of the increase of the capital stock of the GUARANTY TRUST
COMPANY OF NEW YORK from five million dollars ($5,000,000), consisting of fifty
thousand shares, each of the par value of one hundred dollars, to nine million
five hundred thousand dollars ($9,500,000), to consist of ninety-five thousand
shares, each of the par value of one hundred dollars, as set forth in the within
certificate.
WITNESS my hand and the official seal of the Superintendent of Banks at the
City of Albany, this first day of October, in the year of our Lord one thousand
nine hundred and twelve.
GEORGE I. SKINNER
[SEAL] First Deputy Superintendent of Banks
24
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $10,000,000.
The undersigned, Alexander J. Hemphill, Chairman, and Edgar C. Hebbard,
Secretary, respectively, of a special meeting of the stockholders of GUARANTY
TRUST COMPANY OF NEW YORK, a domestic stock corporation, held for the purpose of
increasing its capital stock, do hereby certify as follows:
Prior to such meeting a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week, for at least two successive weeks, in The
New York Times and The Evening Post, each a newspaper published in the county
where the principal business office of such corporation is located.
The following is a true copy of such notice:
GUARANTY TRUST COMPANY OF NEW YORK
28 Nassau Street
New York, September 27, 1912
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK:
A Special Meeting of the Stockholders of GUARANTY TRUST COMPANY OF NEW YORK
has been called and will be held at the office of the corporation, 28 Nassau
Street, Borough of Manhattan, City of New York, upon Tuesday, October 15, 1912,
at twelve o'clock noon. The object of the meeting is to authorize the increase
of the capital stock of GUARANTY TRUST COMPANY OF NEW YORK to the sum of
$10,000,000; the amount of increase proposed being $500,000, if the Stockholders
at their meeting heretofore called shall have authorized the increase heretofore
proposed by the Board of Directors, but otherwise being $5,000,000.
By order of the Board of Directors,
ALEXANDER J. HEMPHILL
President
E. C. HEBBARD
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
stockholder of such corporation, at his last known post-office address, at least
two weeks before the meeting.
At the time and place specified in such notice, stockholders appeared, in
person or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation,
25
<PAGE>
and organized said meeting by choosing from their number the undersigned,
Alexander J. Hemphill, as Chairman, and Edgar C. Hebbard, as Secretary thereof.
The notice of the meeting and proof of the proper publishing and mailing
thereof were presented.
Upon motion, a vote was then taken of those present in person or by proxy
upon the following resolutions:
RESOLVED, That the capital stock of GUARANTY TRUST COMPANY OF NEW YORK be
increased from the present amount thereof, to wit, nine million five hundred
thousand dollars, consisting of ninety-five thousand shares, each of the par
value of one hundred dollars, to the amount of ten million dollars, to consist
of one hundred thousand shares, each of the par value of one hundred dollars.
RESOLVED, That the Chairman and Secretary of this meeting be, and hereby
they are, authorized and directed to make, sign, verify and acknowledge
duplicate certificates of the proceedings of this meeting as required by
statute, and to submit the same to the Superintendent of Banks for his
endorsement thereon of his approval of such increase of capital stock, and
thereupon to cause one of such certificates to be filed and recorded in the
office of the Clerk of the County of New York, and a duplicate thereof in the
office of the Secretary of State, and to cause the same to be entered on the
minutes of the corporation, and to do all other acts and things which may be
necessary to comply with the provisions of law applicable to and regulating such
increase of capital stock.
Stockholders owning 46,311 shares of stock, being at least a majority of all
the stock of the corporation, voted in favor of such resolutions; and
stockholders owning no shares of stock voted against their adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolutions were declared duly adopted.
The amount of the capital stock of said corporation heretofore authorized is
nine million five hundred thousand dollars, and the proportion thereof actually
issued is five million dollars; and the amount of the capital stock, as
increased, is ten million dollars.
The assets of the said corporation are at least equal to the debts and
liabilities and the capital stock as increased.
26
<PAGE>
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in duplicate. Dated this 15th day of October, 1912.
ALEXANDER J. HEMPHILL
Chairman
E. C. HEBBARD
Secretary
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
Alexander J. Hemphill, Chairman, and Edgar C. Hebbard, Secretary,
respectively, of the aforesaid meeting, being severally duly sworn, do depose
and say, and each for himself does depose and say, that he has read the
foregoing certificate subscribed by him, and knows its contents, and that the
same is true.
ALEXANDER J. HEMPHILL
Chairman
E. C. HEBBARD
Secretary
Sworn to before me, this } ss.:
15th day of October, 1912
WM. H. BRUDER,
Notary Public,
New York County No. 165.
N. Y. Register No. 3074.
[NOTARIAL
SEAL]
27
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 15th day of October, 1912, before me personally came Alexander J.
Hemphill and Edgar C. Hebbard, each to me known, and known to me to be the
individuals described in and who executed the foregoing instrument or
certificate, and severally duly acknowledged to me that they executed the same.
WM. H. BRUDER
Notary Public
New York County
No. 165 N. Y. Register No. 3074
[NOTARIAL
SEAL]
STATE OF NEW YORK } ss.:
BANKING DEPARTMENT
I HEREBY APPROVE of the increase of the capital stock of the GUARANTY TRUST
COMPANY OF NEW YORK from nine million five hundred thousand dollars ($9,500,000)
consisting of ninety-five thousand shares, each of the par value of one hundred
dollars, to ten million dollars ($10,000,000), to consist of one hundred
thousand shares, each of the par value of one hundred dollars, as set forth in
the within certificate.
WITNESS my hand and the official seal of the Superintendent of Banks at the
City of New York, this fifteenth day of October, in the year of our Lord one
thousand nine hundred and twelve.
GEO. C. VAN TUYL, JR.,
[SEAL] Superintendent of Banks
28
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $20,000,000.
The undersigned, Charles H. Sabin, Chairman, and E. C. Hebbard, Secretary,
respectively, of a special meeting of the stockholders of GUARANTY TRUST COMPANY
OF NEW YORK, a domestic stock corporation, held for the purpose of voting upon a
proposed increase of its capital stock, do hereby certify as follows:
Prior to such meeting a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week, for at least two successive weeks in The
New York Times and The Evening Post, each being a newspaper published in the
County of New York, the county where the principal business office of such
corporation is located.
The following is a true copy of such notice:
GUARANTY TRUST COMPANY OF NEW YORK
140 Broadway
New York, November 8, 1915
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK
A special meeting of the Stockholders of GUARANTY TRUST COMPANY OF NEW YORK
has been called and will be held at the office of the corporation, No. 140
Broadway, Borough of Manhattan, City of New York, on Wednesday, November 24,
1915, at twelve o'clock noon. The object of the meeting is to vote upon the
proposed increase of the capital stock of the GUARANTY TRUST COMPANY OF NEW YORK
by $10,000,000, namely: from $10,000,000 to $20,000,000 and to determine the
disposition of such increase.
By order of the Board of Directors.
CHARLES H. SABIN
President
E. C. HEBBARD
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
stockholder of such corporation, at his last-known post-office address, at least
two weeks before the meeting.
At the time and place specified in such notice, stockholders appeared, in
person or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation
29
<PAGE>
and organized by choosing from their number the undersigned, Charles H. Sabin as
Chairman, and E. C. Hebbard as Secretary thereof.
The notice of the meeting and proof of the proper publishing and mailing
thereof were presented.
Upon motion, a vote was then taken of those present in person or by proxy
upon the following resolutions:
RESOLVED, That the capital stock of GUARANTY TRUST COMPANY OF NEW YORK be
increased from the present amount thereof, to-wit, $10,000,000, consisting of
100,000 shares, each of the par value of $100, all thereof having been
heretofore authorized and actually issued, to the amount of $20,000,000, to
consist of 200,000 shares, each of the par value of $100.
RESOLVED, That the Chairman and the Secretary of this meeting be and hereby
are authorized and directed to make, sign, verify and acknowledge a certificate
in triplicate of the proceedings of this meeting, as required by statute, and to
submit the same to the Superintendent of Banks for his endorsement thereon of
his approval of such increase of capital stock, and thereupon to cause such
certificate to be filed in the office of the Clerk of the County of New York, a
duplicate thereof in the office of the Secretary of State, and a triplicate
thereof in the office of the Superintendent of Banks, and to cause the
proceedings of this meeting to be entered in the minutes of the corporation, and
to do all other acts and things which may be necessary to comply with the
provisions of law applicable to and regulating such increase of capital stock.
Stockholders owning 87,002 shares of stock, being at least a majority of all
the stock of the corporation, voted in favor of such resolutions; and
stockholders owning no shares voted against their adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolutions were declared duly adopted.
The amount of the capital stock of the corporation heretofore authorized is
$10,000,000 and the whole thereof is actually issued; and the amount of the
capital stock as increased is $20,000,000.
The assets of the corporation are at least equal to its debts and
liabilities and the capital stock as increased.
30
<PAGE>
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in triplicate.
Dated this 24th day of November, 1915.
CHARLES H. SABIN
[CANCELLED REVENUE Chairman
STAMP 10 CENTS] E. C. HEBBARD
Secretary
STATE OF NEW YORK
COUNTY OF NEW YORK
Charles H. Sabin, Chairman, and E. C. Hebbard, Secretary, respectively of
the aforesaid meeting, being severally duly sworn, do depose and say, and each
for himself does depose and say, that he has read the foregoing certificate,
subscribed by him, and knows its contents, and that the same is true.
CHARLES H. SABIN
Chairman
E. C. HEBBARD
Secretary
Sworn to before me this }
24th day of November, 1915
Wm. H. BRUDER
Notary Public Bronx County, No. 35
[NOTARIAL Certificate filed in New York
SEAL] County, No. 45
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 24th day of November, 1915, before me personally came Charles H.
Sabin and E. C. Hebbard, each to me known and known to me to be the persons
described in and who executed the foregoing certificate, and they severally duly
acknowledged to me that they executed the same.
WM. H. BRUDER
Notary Public Bronx County, No. 35
Certificate filed in New York County, No. 45
Notary Public New York County
31
<PAGE>
[NOTARIAL
SEAL]
[ENDORSEMENT]
STATE OF NEW YORK }
BANKING DEPARTMENT
I hereby approve of the increase of the capital stock of GUARANTY TRUST
COMPANY OF NEW YORK from $10,000,000, consisting of 100,000 shares, each of the
par value of $100, to $20,000,000, to consist of 200,000 shares, each of the par
value of $100, as set forth in the within certificate.
WITNESS my hand and official seal at the City of New York this 24th day of
November, 1915.
EUGENE LAMB RICHARDS
Superintendent of Banks of the State of New York
32
<PAGE>
Guaranty Trust Company of New York.
CERTIFICATE OF INCREASE OF
CAPITAL STOCK TO $25,000,000.
The undersigned, Charles H. Sabin, Chairman, and F. W. Ellsworth, Secretary,
respectively, of a special meeting of the stockholders of Guaranty Trust Company
of New York, a domestic stock corporation, held for the purpose of voting upon a
proposed increase of its capital stock, do hereby certify as follows:
Prior to such meeting a notice, stating the time, place and object thereof,
and the amount of the increase proposed, signed by the President and the
Secretary, was published once a week for at least two successive weeks in The
New York Times and The Evening Post, each being a newspaper published in the
County of New York, the county where the principal business office of such
corporation is located.
The following is a true copy of such notice:
GUARANTY TRUST COMPANY OF NEW YORK
140 Broadway
New York, June 7, 1917
TO THE STOCKHOLDERS OF
GUARANTY TRUST COMPANY OF NEW YORK
A special meeting of the stockholders of Guaranty Trust Company of New York
has been called and will be held at the office of the corporation, No. 140
Broadway, Borough of Manhattan, City of New York, on Monday, June 25, 1917, at
twelve o'clock noon. The object of the meeting is to vote upon the proposed
increase of the capital stock of the Guaranty Trust Company of New York by
$5,000,000, namely: from $20,000,000 to $25,000,000, and to determine the
disposition of such increase.
By order of the Board of Directors.
CHARLES H. SABIN
President
F. W. ELLSWORTH
Secretary
A copy of such notice was also duly mailed, postage prepaid, to each
stockholder of such corporation, at his last-known post-office address, at least
two weeks before the meeting.
33
<PAGE>
At the time and place specified in such notice, stockholders appeared, in
person or by proxy, in numbers representing at least a majority of all the
shares of stock of such corporation and organized by choosing from their number
the undersigned Charles H. Sabin as Chairman and F. W. Ellsworth as Secretary of
the meeting.
The notice of the meeting and proof of the proper publication and mailing
thereof were presented.
Upon motion, a vote was then taken of those present in person or by proxy
upon the following resolutions:
RESOLVED, That the capital stock of GUARANTY TRUST COMPANY OF NEW YORK be
increased from the present amount thereof, to-wit, $20,000,000, consisting of
200,000 shares, each of the par value of $100, all thereof having been
heretofore authorized and actually issued, to the amount of $25,000,000, to
consist of 250,000 shares, each of the par value of $100.
RESOLVED, That the Chairman and the Secretary of this meeting be and hereby
are authorized and directed to make, sign, verify and acknowledge a certificate
in triplicate of the proceedings of this meeting, as required by statute, and to
submit the same to the Superintendent of Banks for his endorsement thereon of
his approval of such increase of capital stock, and thereupon to cause such
certificate to be filed in the office of the Clerk of the County of New York, a
duplicate thereof in the office of the Secretary of State, and a triplicate
thereof in the office of the Superintendent of Banks, and to cause the
proceedings of this meeting to be entered in the minutes of the corporation, and
to do all other acts and things which may be necessary to comply with the
provisions of law applicable to and regulating such increase of capital stock.
Stockholders owning, 157,112 shares of stock, being at least a majority of
all the stock of the corporation, voted in favor of such resolutions; and
stockholders owning no shares voted against their adoption.
A sufficient number of votes having been cast in favor of such increase,
such resolutions were declared duly adopted.
The amount of the capital stock of the corporation heretofore authorized is
$20,000,000, and the whole thereof is actually issued; and the amount of the
capital stock as increased is $25,000,000.
The assets of the corporation are at least equal to its debts and
liabilities and the capital stock as increased.
34
<PAGE>
IN WITNESS WHEREOF, We have made, signed, verified and acknowledged this
certificate in triplicate.
Dated this 25th day of June, 1917.
CHARLES H. SABIN
[CORPORATE Chairman
SEAL] F. W. ELLSWORTH
Secretary
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
Charles H. Sabin, Chairman, and F. W. Ellsworth, Secretary, respectively of
the aforesaid meeting, being severally duly sworn, do depose and say, and each
for himself does depose and say, that he has read the foregoing certificate,
subscribed by him, and knows its contents, and that the same is true.
CHARLES H. SABIN
Chairman
F. W. ELLSWORTH
Secretary
Sworn to before me
this 25th day of June, 1917
WM. H. BRUDER
Notary Public Bronx County, No. 38
Certificate filed in New York County No. 77
[SEAL]
35
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 25th day of June, 1917, before me personally came Charles H. Sabin
and F. W. Ellsworth, each to me known and known to me to be the persons
described in and who executed the foregoing certificate, and they severally duly
acknowledged to me that they executed the same.
WM. H. BRUDER
Notary Public Bronx County, No. 38
Certificate filed in New York County, No. 77
[SEAL]
[ENDORSEMENT]
STATE OF NEW YORK
BANKING DEPARTMENT
I hereby approve of the increase of the capital stock of Guaranty Trust
Company of New York from $20,000,000, consisting of 200,000 shares, each of the
par value of $100, to $25,000,000, to consist of 250,000 shares, each of the par
value of $100, as set forth in the within certificate.
WITNESS my hand and official seal at the City of Albany, this 26th day of
June, 1917.
GEORGE I. SKINNER
First Deputy Superintendent of Banks
of the State of New York
[SEAL]
36
<PAGE>
CERTIFICATE OF INCREASE IN THE AMOUNT OF ITS
CAPITAL STOCK
OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW.
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York, for the purpose of increasing the amount of
its capital stock, pursuant to Section thirty-six of the Stock Corporation Law
of the State of New York, hereby do make, subscribe, acknowledge and file this
certificate, stating as follows:
1. The name of the corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which it was originally incorporated was New York Guaranty
and Indemnity Company.
2. The corporation was created by a special law and has no certificate of
incorporation.
The chapter number and year of passage of such law is:
Chapter 179. Laws of 1864.
3. The total amount of the previously authorized capital stock is
Twenty-five Million Dollars ($25,000,000), all of the shares having a par value.
4. The total number of shares which the corporation is already authorized to
issue is Two hundred fifty thousand (250,000) shares. The number thereof which
have a par value is Two hundred fifty thousand (250,000) shares. The par value
of each of such shares is One Hundred Dollars ($100). None of such shares are
without par value.
5. None of the shares already authorized are classified.
6. The number of shares issued and outstanding is Two hundred fifty thousand
(250,000) shares.
7. None of the shares are without par value.
8. The amount of the capital stock which the corporation is hereafter to
have is Thirty Million Dollars ($30,000,000) and all the shares are to have a
par value.
37
<PAGE>
9. The total number of shares, including those previously authorized, which
the corporation may henceforth have is Three hundred thousand (300,000) shares.
The number thereof which are to have a par value is Three hundred thousand
(300,000) shares. The par value of each such share is to be One Hundred Dollars
($100.). None of such shares are to be without par value.
Dated, March 11th, 1927.
WILLIAM C. POTTER
President of Guaranty Trust Company of New York
MATTHEW T. MURRAY, JR.
Secretary of Guaranty Trust Company of New York
[SEAL]
State of New York } ss.:
County of New York
On this 11 day of March, 1927, before me personally came WILLIAM C. POTTER
and MATTHEW T. MURRAY, JR., to me known and known to me to be the persons
described in and who executed the foregoing certificate and they severally duly
acknowledged to me that they executed the same.
JAMES G. DUNNET
Notary Public, Nassau County
New York Co. Clerk's No. 624
New York Co. Register's No. 8435
Commission expires March 30, 1928
[SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
No. 33712 Series B
I, William T. Collins, Clerk of the County of New York, and also Clerk of
the Supreme Court in and f or said county,
DO HEREBY CERTIFY, That said Court is a Court of Record, having by law a
seal; that
JAMES G. DUNNET
whose name is subscribed to the annexed certificate or proof of acknowledgment
of the annexed instrument was at the time of taking the same a NOTARY PUBLIC
acting in and for said county, duly commissioned and sworn, and qualified to act
as such; that he has filed in the Clerk's office of the County of New York a
certified copy of his appointment and qualification as Notary Public for the
County of Nassau with his autograph signature; that as such Notary Public,
38
<PAGE>
he was duly authorized by the laws of the State of New York to protest notes; to
take and certify depositions; to administer oaths and affirmations; to take
affidavits and certify the acknowledgment and proof of deeds and other written
instruments for lands, tenements and hereditaments, to be read in evidence or
recorded in this state; and further, that I am well acquainted with the
handwriting of such Notary Public and verily believe that his signature to such
proof or acknowledgment is genuine.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the seal of
said Court at the City of New York, in the County of New York, this 11 day of
Mar. 1927.
WILLIAM T. COLLINS,
Clerk
[SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM C. POTTER and MATTHEW T. MURRAY, JR.. being severally duly sworn,
depose and say, and each for himself deposes and says:
1. That he, the said WILLIAM C. POTTER, is the President of, and he, the
said MATTHEW T. MURRAY, JR., is the Secretary of Guaranty Trust Company of New
York.
2. That they have been authorized to execute and file the foregoing
certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of the said Guaranty Trust Company of
New York, entitled to vote thereon; and that such votes were cast at a
stockholders' meeting held on March 11, 1927, upon notice pursuant to section
forty-five of the Stock Corporation Law of the State of New York.
WILLIAM C. POTTER
MATTHEW T. MURRAY, JR.
Sworn to before me this 11 day of March, 1927.
JAMES G. DUNNET
Notary Public, Nassau County
New York Co. Clerk's No. 624
New York Co. Register's No. 8435
[SEAL] Commission expires March 30, 1928.
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
39
<PAGE>
No. 33711 Series B
I, William T. Collins, Clerk of the County of New York, and also Clerk of
the Supreme Court in and for said county,
DO HEREBY CERTIFY, That said Court is a Court of Record, having by law a
seal; that
JAMES G. DUNNET
whose name is subscribed to the annexed certificate or proof of
acknowledgment of the annexed instrument was at the time of taking the same a
NOTARY PUBLIC acting in and for said county, duly commissioned and sworn, and
qualified to act as such; that he has filed in the Clerk's office of the County
of New York a certified copy of his appointment and qualification as Notary
Public for the County of Nassau with his autograph signature; that as such
Notary Public, he was duly authorized by the laws of the State of New York to
protest notes; to take and certify depositions; to administer oaths and
affirmations; to take affidavits and certify the acknowledgment and proof of
deeds and other written instruments for lands, tenements and hereditaments, to
be read in evidence or recorded in this state; and further, that I am well
acquainted with the handwriting of such Notary Public and verily believe that
his signature to such proof or acknowledgment is genuine.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the seal of
said Court at the City of New York, in the County of New York, this 11 day of
Mar. 1927.
WILLIAM T. COLLINS,
[SEAL] Clerk
STATE OF NEW YORK } ss.:
BANKING DEPARTMENT
I, GEORGE OVEROCKER, First Deputy Superintendent of Banks of the State of
New York, DO HEREBY APPROVE of the increase of capital stock of the GUARANTY
TRUST COMPANY OF NEW YORK, located in the Borough of Manhattan, City of New
York, from Twenty-five Million (25,000,000) Dollars, consisting of two hundred
and fifty thousand (250,000) shares of the par value of one hundred dollars
each, to Thirty Million (30,000,000) Dollars, to consist of three hundred
thousand (300,000) shares of the par value of one hundred dollars each, as set
forth in the foregoing certificate.
WITNESS, my hand and official seal at the City of Albany, this twelfth day
of March in the Year of our Lord one thousand nine hundred and twenty-seven.
GEO. OVEROCKER
First Deputy Superintendent of Banks
[SEAL]
40
<PAGE>
CERTIFICATE OF INCREASE IN THE AMOUNT OF THE
CAPITAL STOCK
OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW.
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York, for the purpose of increasing the amount of
its capital stock, pursuant to Section thirty-six of the Stock Corporation Law
of the State of New York, hereby do make, subscribe, acknowledge and file this
certificate, stating as follows:
1. The name of the corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which it was originally incorporated was New York Guaranty
and Indemnity Company.
2. The corporation was created by a special law and has no certificate of
incorporation.
The chapter number and year of passage of such law is:
Chapter 179, Laws of 1864.
3. The total amount of the previously authorized capital stock is Thirty
Million Dollars ($30,000,000) , all of the shares having a par value.
4. The total number of shares which the corporation is already authorized to
issue is Three hundred thousand (300,000) shares. The number thereof which have
a par value is Three hundred thousand (300,000) shares. The par value of each of
such shares is One Hundred Dollars ($100). None of such shares are without par
value.
5. None of the shares already authorized are classified.
6. The number of shares issued and outstanding is Three hundred thousand
(300,000) shares.
7. None of the shares are without par value.
41
<PAGE>
8. The amount of the capital stock which the corporation is hereafter to
have is Forty Million Dollars ($40,000,000), and all of the shares are to have a
par value.
9. The total number of shares, including those previously authorized, which
the corporation may henceforth have is Four hundred thousand (400,000) shares.
The number thereof which are to have a par value is Four hundred thousand
(400,000) shares. The par value of each such share is to be One Hundred Dollars
($100). None of such shares are to be without par value.
Dated, May 18, 1928.
WILLIAM C. POTTER
President of Guaranty Trust Company of New York
MATTHEW T. MURRAY, JR.
Secretary of Guaranty Trust Company of New York
[CORPORATE SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 18th day of May, 1928, before me personally came WILLIAM C. POTTER
and MATTHEW T. MURRAY, JR., to me known and known to me to be the persons
described in and who executed the foregoing certificate and they severally duly
acknowledged to me that they executed the same.
JAMES G. DUNNET
Notary Public, Nassau County
New York Co. Clerk's No. 422
New York Co. Register's No. 0295
Commission Expires March 30, 1930
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
No. 46489 Series B
I, William T. Collins, Clerk of the County of New York, and also Clerk of
the Supreme Court in and for said county.
DO HEREBY CERTIFY, That said Court is a Court of Record, having by law a
seal; that
JAMES G. DUNNET
42
<PAGE>
whose name is subscribed to the annexed certificate or proof of acknowledgment
of the annexed instrument was at the time of taking the same a NOTARY PUBLIC
acting in and for said county, duly commissioned and sworn, and qualified to act
as such; that he has filed in the Clerk's Office of the County of New York a
certified copy of his appointment and qualification as Notary Public for the
County of Nassau with his autograph signature; that as such Notary Public, he
was duly authorized by the laws of the State of New York to protest notes; to
take and certify depositions; to administer oaths and affirmations; to take
affidavits and certify the acknowledgment and proof of deeds and other written
instruments for lands, tenements and hereditaments, to be read in evidence or
recorded in this state; and further, that I am well acquainted with the
handwriting of such Notary Public and verily believe that his signature to such
proof or acknowledgment is genuine.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the seal of
said Court at the City of New York, in the County of New York, this 18 day of
May 1928.
WILLIAM T. COLLINS,
[SEAL] Clerk
43
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM C. POTTER and MATTHEW T. MURRAY, JR., being severally duly sworn,
depose and say, and each for himself deposes and says:
1. That he, the said WILLIAM C. POTTER, is the President of, and he, the
said MATTHEW T. MURRAY, JR., is the Secretary of, Guaranty Trust Company of New
York.
2. That they have been authorized to execute and file the foregoing
certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of the said Guaranty Trust Company of
New York, entitled to vote thereon; and that such votes were cast at a
stockholders' meeting held on May 18, 1928, upon notice pursuant to section
forty-five of the Stock Corporation Law of the State of New York.
WILLIAM C. POTTER
MATTHEW T. MURRAY, JR.
Severally subscribed and sworn to before me this 18th day of May, 1928.
JAMES G. DUNNET
Notary Public, Nassau County
New York Co. Clerk's No. 422
New York Co. Register's No. 0295
Commission Expires March 30, 1930
[NOTARIAL SEAL]
44
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
No. 46500 Series B
I, William T. Collins, Clerk of the County of New York, and also Clerk of
the Supreme Court in and for said county,
DO HEREBY CERTIFY, That said Court is a Court of Record, having by law a
seal; that
JAMES G. DUNNET whose name is subscribed to the annexed certificate or proof
of acknowledgment of the annexed instrument was at the time of taking the same a
NOTARY PUBLIC acting in and for said county, duly commissioned and sworn, and
qualified to act as such; that he has filed in the Clerk's office of the County
of New York a certified copy of his appointment and qualification as Notary
Public for the County of Nassau with his autograph signature; that as such
Notary Public, he was duly authorized by the laws of the State of New York to
protest notes; to take and certify depositions; to administer oaths and
affirmations; to take affidavits and certify the acknowledgment and proof of
deeds and other written instruments for lands, tenements and hereditaments, to
be read in evidence or recorded in this state; and further, that I am well
acquainted with the handwriting of such Notary Public and verily believe that
his signature to such proof or acknowledgment is genuine.
IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the seal of
said Court at the City of New York, in the County of New York, this 18 day of
May 1928.
WILLIAM T. COLLINS,
[SEAL] Clerk
STATE OF NEW YORK
BANKING DEPARTMENT
I, GEORGE OVEROCKER, First Deputy Superintendent of Banks of the State of
New York, DO HEREBY APPROVE of the increase of capital stock of GUARANTY TRUST
COMPANY OF NEW YORK, located at 140 Broadway, in the borough of Manhattan, city
of New York, from Thirty Million (30,000,000) Dollars, consisting of three
hundred thousand (300,000) shares of the par value of one hundred dollars each,
to Forty Million (40,000,000) Dollars, to consist of four hundred thousand
(400,000) shares of the par value of one hundred dollars each, as set forth in
the foregoing certificate.
WITNESS, my hand and official seal at the City of Albany, this eighteenth
day of May in the Year of our Lord one thousand nine hundred and twenty-eight.
GEO. OVEROCKER
First Deputy Superintendent of Banks
45
<PAGE>
[SEAL]
46
<PAGE>
CERTIFICATE OF INCREASE IN THE AMOUNT OF THE
CAPITAL STOCK
OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW.
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York, for the purpose of increasing the amount of
its capital stock, pursuant to Section thirty-six of the Stock Corporation Law
of the State of New York, hereby do make, subscribe, acknowledge and file this
certificate, stating as follows:
1. The name of the corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which it was originally incorporated was New York Guaranty
and Indemnity Company.
2. The corporation was created by a special law and has no certificate of
incorporation. The chapter number and year of passage of such law is:
Chapter 179, Laws of 1864
3. The total amount of the previously authorized capital stock is Forty
Million Dollars ($40,000,000), all of the shares having a par value.
4. The total number of shares which the corporation is already authorized to
issue is Four hundred thousand (400,000) shares. The number thereof which have a
par value is Four hundred thousand (400,000) shares. The par value of each of
such shares is One Hundred Dollars ($100). None of such shares are without par
value.
5. None of the shares already authorized are classified.
6. The number of shares issued and outstanding is Four hundred thousand
(400,000) shares.
7. None of the shares are without par value.
8. The amount of the capital stock which the corporation is hereafter to
have is Seventy Million Dollars ($70,000,000), and all of the shares are to have
a par value.
47
<PAGE>
9. The total number of shares, including those previously authorized, which
the corporation may henceforth have is Seven hundred thousand (700,000) shares.
The number thereof which are to have a par value is Seven hundred thousand
(700,000) shares. The par value of each such share is to be One Hundred Dollars
($100). None of such shares are to be without par value.
Dated, May 2, 1929.
WILLIAM C. POTTER
President of Guaranty Trust Company of New York
MATTHEW T. MURRAY, JR..
Secretary of Guaranty Trust Company of New York
[CORPORATE SEAL]
48
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 2nd day of May, 1929, before me personally came WILLIAM C. POTTER
and MATTHEW T. MURRAY, JR., to me known and known to me to be the persons
described in and who executed the foregoing certificate and they severally duly
acknowledged to me that they executed the same.
CHARLOTTE G. SMITH
Notary Public, New York Co.
N. Y. Co. Clk's No. 308 Reg. No. 0-69
Commission expires March 30, 1930
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM C. POTTER and MATTHEW T. MURRAY, JR., being severally duly sworn,
depose and say, and each for himself deposes and says:
1. That he, the said WILLIAM C. POTTER, is the President of, and he, the
said MATTHEW T. MURRAY, JR., is the Secretary of, Guaranty Trust Company of New
York.
2. That they have been authorized to execute and file the foregoing
certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of the said Guaranty Trust Company of
New York, entitled to vote thereon; and that such votes were cast at a
stockholders' meeting held on May 2, 1929, upon notice pursuant to section
forty-five of the Stock Corporation Law of the State of New York.
WILLIAM C. POTTER
MATTHEW T. MURRAY, JR.
Severally subscribed and sworn to before me this 2nd day of May, 1929.
CHARLOTTE G. SMITH
Notary Public, New York Co.
N. Y. Co. Clk's No. 308 Reg. No. 0-69
Commission expires March 30, 1930
[NOTARIAL SEAL]
49
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT.
I, JOSEPH A. BRODERICK, Superintendent of Banks of the State of New York, DO
HEREBY APPROVE of an increase of capital stock of GUARANTY TRUST COMPANY OF NEW
YORK, located at No. 140 Broadway, in the borough of Manhattan, city of New
York, from Forty Million (40,000,000) Dollars, consisting of four hundred
thousand (400,000) shares of the par value of One Hundred (100) Dollars each, to
Seventy Million (70,000,000) Dollars, to consist of seven hundred thousand
(700,000) shares of the par value of One Hundred (100) Dollars each, as set
forth in the foregoing certificate.
WITNESS, my hand and official seal at the City of Albany, this second day of
May in the Year of Our Lord one thousand nine hundred and twenty-nine.
JOSEPH A. BRODERICK
[SEAL] Superintendent of Banks
50
<PAGE>
CERTIFICATE OF INCREASE IN THE AMOUNT OF THE
CAPITAL STOCK
OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW.
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York, for the purpose of increasing the amount of
its capital stock, pursuant to Section thirty-six of the Stock Corporation Law
of the State of New York, hereby do make, subscribe, acknowledge and file this
certificate, stating as follows:
1. The name of the corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which it was originally incorporated was New York Guaranty
and Indemnity Company.
2. The corporation was created by a special law and has no certificate of
incorporation. The chapter number and year of passage of such law is:
Chapter 179, Laws of 1864.
3. The total amount of the previously authorized capital stock is Seventy
Million Dollars ($70,000,000), all of the shares having a par value.
4. The total number of shares which the corporation is already authorized to
issue is Seven hundred thousand (700,000) shares. The number thereof which have
a par value is Seven hundred thousand (700,000) shares. The par value of each of
such shares is One hundred Dollars ($100). None of such shares are without par
value.
5. None of the shares already authorized are classified.
6. The number of shares issued and outstanding is Seven hundred thousand
(700,000) shares.
7. None of the shares are without par value.
8. The amount of the capital stock which the corporation is hereafter to
have is Ninety Million Dollars ($90,000,000), and all of the shares are to have
a par value.
51
<PAGE>
9. The total number of shares, including those previously authorized, which
the corporation may henceforth have is Nine hundred thousand (900,000) shares.
The number thereof which are to have a par value is Nine hundred thousand
(900,000) shares. The par value of each such share is to be One Hundred Dollars
($100). None of such shares are to be without par value.
Dated, June 24th, 1929.
WILLIAM C. POTTER
President of Guaranty Trust Company of New York
MATTHEW T. MURRAY, JR..
Secretary of Guaranty Trust Company of New York
[CORPORATE SEAL]
52
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 24th day of June, 1929, before me personally came WILLIAM C. POTTER
and MATTHEW T. MURRAY, JR., to me known and known to me to be the persons
described in and who executed the foregoing certificate and they severally duly
acknowledged to me that they executed the same.
FREDERICK B. KINGSLEY
Notary Public, Bronx County
Bronx County Clerk's No. 128,
Register's No. 3047
New York County Clerk's No. 214,
Register's No. 0-184
Commission Expires March 30, 1930
FREDERICK B. KINGSLEY
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM C. POTTER and MATTHEW T. MURRAY, JR., being severally duly sworn,
depose and say, and each for himself deposes and says:
1. That he, the said WILLIAM C. POTTER, is the President of, and he, the
said MATTHEW T. MURRAY, JR., is the Secretary of, Guaranty Trust Company of New
York.
2. That they have been authorized to execute and file the foregoing
certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of the said Guaranty Trust Company of
New York, entitled to vote thereon; and that such votes were cast at a
stockholders' meeting held on June 24th, 1929, upon notice pursuant to section
forty-five of the Stock Corporation Law of the State of New York.
WILLIAM C. POTTER
MATTHEW T. MURRAY, JR.
53
<PAGE>
Severally subscribed and sworn to before me this 24th day of June, 1929.
FREDERICK B. KINGSLEY
Notary Public, Bronx County
Bronx County Clerk's No. 128,
Register's No. 3047
New York County Clerk's No. 214,
Register's No. 0-184
Commission Expires March 30, 1930
FREDERICK B. KINGSLEY
[NOTARIAL SEAL]
STATE OF NEW YORK
BANKING DEPARTMENT
I, JOSEPH A. BRODERICK, Superintendent of Banks of the State of New York, DO
HEREBY APPROVE of the increase of capital stock of the GUARANTY TRUST COMPANY OF
NEW YORK, located at No. 140 Broadway, in the Borough of Manhattan, City of New
York, from Seventy Million (70,000,000) Dollars, consisting of seven hundred
thousand (700,000) shares of the par value of one hundred dollars each, to
Ninety Million (90,000,000) Dollars, to consist of nine hundred thousand
(900,000) shares of the par value of one hundred dollars each, as set forth in
the foregoing certificate.
WITNESS, my hand and official seal at the City of Albany, this Twenty-fourth
day of June in the Year of our Lord one thousand nine hundred and twenty-nine.
JOSEPH A. BRODERICK
Superintendent of Banks
[SEAL]
54
<PAGE>
CERTIFICATE OF INCREASE OF THE AMOUNT OF
CAPITAL STOCK AND AUTHORIZATION OF
NEW SHARES
OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York (hereinafter called the "Corporation"), for
the purpose of increasing the amount of its capital stock and of authorizing new
shares pursuant to Section Thirty-six of the Stock Corporation Law of the State
of New York, hereby do make, subscribe, acknowledge and file this certificate,
stating as follows:
1. The name of the Corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which the Corporation was originally incorporated was New
York Guaranty and Indemnity Company.
2. The Corporation was created by a special law and has no certificate of
incorporation. The chapter number and year of passage of such law is:
Chapter 179, Laws of 1864.
3. The total amount of the previously authorized capital stock is Ninety
Million Dollars ($90,000,000).
4. The total number of shares which the Corporation is already authorized to
issue is nine hundred thousand (900,000) shares, all of which have a par value
of One Hundred Dollars ($100) each.
5. The shares previously authorized are not classified.
6. The number of shares issued, and the number of shares outstanding, is
nine hundred thousand (900,000) shares.
7. None of the shares is without par value.
55
<PAGE>
8. The amount of the capital stock which the Corporation is hereafter to
have is One Hundred Million Dollars ($100,000,000) and all of the shares are to
have a par value.
9. The total number of shares, including those previously authorized, which
the Corporation may henceforth have is one million (1,000,000) shares, all of
which are to have a par value of One Hundred Dollars ($100) each.
Dated, January 15th, 1947.
J. LUTHER CLEVELAND
President of Guaranty Trust Company of New York
MATTHEW T. MURRAY
Secretary of Guaranty Trust Company of New York
[CORPORATE SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 15th day of January, 1947, before me personally came J. LUTHER
CLEVELAND and MATTHEW T. MURRAY, to me known and known to me to be the
individuals described in and who subscribed and executed the foregoing
Certificate as President and Secretary, respectively, of Guaranty Trust Company
of New York, and they severally acknowledged to me that they subscribed and
executed the same.
JAMES S. O'HARE
Notary Public, State of New York
Resident, Kings County
Kings Co. Clk's No. 28, Reg. No. 59-0-8
N. Y. Co. Clk's No. 120, Reg. No. 52-0-8
Commission Expires March 30, 1948
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
J. LUTHER CLEVELAND and MATTHEW T. MURRAY, being duly sworn, depose and say,
and each for himself deposes and says, that he, J. LUTHER CLEVELAND, is the
President of Guaranty Trust Company of New York, and he, MATTHEW T. MURRAY is
the Secretary thereof; that they have been authorized to execute and file the
foregoing Certificate by the votes, cast in person or by proxy, of the holders
of record of a majority of the outstanding shares of said Guaranty Trust Company
of New York entitled to vote at the stockholders' meeting at which such votes
were cast, with relation to the proceedings provided for in said Certificate;
and that such votes were cast at a stockholders' meeting held at the office of
Guaranty Trust Company o f New York, 140 Broadway, New York, N. Y., on the
fifteenth day of January, 1947, upon notice pursuant to Section Forty-five of
the Stock Corporation Law of the State of New York.
56
<PAGE>
J. LUTHER CLEVELAND
MATTHEW T. MURRAY
Severally sworn to before me
the 15th day of January, 1947
JAMES S. O'HARE
Notary Public, State of New York
Resident, Kings County
Kings Co. Clk's No. 28, Reg. No. 59-0-8
N. Y. Co. Clk's No. 120, Reg. No. 52-0-8
Commission Expires March 30, 1948
[NOTARIAL SEAL]
57
<PAGE>
STATE OF NEW YORK
BANKING DEPARTMENT
I, CHARLES H. SCHOCH, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate, entitled "Certificate of
Increase of the Amount of Capital Stock and Authorization of New Shares of
GUARANTY TRUST COMPANY OF NEW YORK, pursuant to Section Thirty-six of the Stock
Corporation Law," providing for increase of capital stock from Ninety Million
($90,000,000) Dollars, consisting of Nine Hundred Thousand (900,000) Shares of
the par value of One Hundred ($100) Dollars each, to One Hundred Million
($100,000,000) Dollars, consisting of One Million (1,000,000) Shares of the par
value of One Hundred ($100) Dollars each.
WITNESS my hand and official seal of the Banking Department at the City of
Albany, this 15th day of January in the Year of our Lord one thousand nine
hundred and forty-seven.
CHAS. H. SCHOCH
Deputy Superintendent of Banks
[SEAL]
58
<PAGE>
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW
We, the undersigned, being the President and the Secretary, respectively, of
Guaranty Trust Company of New York (hereinafter called the "Corporation"),
hereby do subscribe, acknowledge and file this certificate, stating as follows:
1. The name of the Corporation is
GUARANTY TRUST COMPANY OF NEW YORK
The name under which the Corporation was originally incorporated was New
York Guaranty and Indemnity Company.
2. The Corporation was created by a special law and has no certificate of
incorporation. The chapter number and year of passage of such law is Chapter
179, Laws of 1864.
3. The number and par value of the authorized, issued and outstanding shares
of the Corporation are changed, in accordance with the provisions of
sub-paragraph (5) of Paragraph (C) of subdivision 2 of section thirty-five of
the stock corporation law, by changing all of the previously authorized
1,000,000 shares of the par value of $100 each, issued and outstanding, into
5,000,000 shares of the par value of $20 each, authorized, issued and
outstanding.
4. Paragraph 9 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law", dated and filed on
January 15, 1947, which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is one million (1,000,000)
shares, all of which are to have a par value of One Hundred Dollars
($100) each."
is changed to read as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is five million (5,000,000)
shares, all of which are to be of one class of capital stock and all of
which are to have a par value of Twenty Dollars ($20) each."
59
<PAGE>
5. The previously authorized 1,000,000 shares of the par value of $100 each,
all of which are issued and outstanding, are to be changed on the effective date
of this certificate and without further action, into 5,000,000 shares of the par
value of $20 each, all of which shall be issued and outstanding, each share of
the par value of $100 being changed into five shares of the par value of $20
each. Neither the amount of the capital stock nor the capital of the Corporation
is to be changed by this certificate.
Dated, January 21, 1953.
WILLIAM L. KLEITZ
President
STUART K. BARNES
Secretary
STATE OF NEW YORK
} ss.:
COUNTY OF NEW YORK
On this 21st day of January 1953, before me personally came WILLIAM L.
KLEITZ and STUART K. BARNES, to me known and known to me to be the individuals
described in and who subscribed and executed the foregoing Certificate, as
President and Secretary, respectively, of GUARANTY TRUST COMPANY OF NEW YORK,
and they severally acknowledged to me that they subscribed and executed the
same.
RUSSELL E. WEAVER
Notary Public, State of New York
No. 30-9556200
Cert. filed with Nassau & New York
County Clerks
Term Expires March 30, 1954
[NOTARIAL SEAL]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM L. KLEITZ and STUART K. BARNES, being duly sworn, depose and say,
and each for himself deposes and says, that he, WILLIAM L. KLEITZ, is the
President of Guaranty Trust Company of New York, and he, STUART K. BARNES, is
the Secretary thereof ; that they have been authorized to execute and file the
foregoing Certificate by the votes, cast in person or by proxy, of the holders
of record of. two-thirds of the outstanding shares of said Guaranty Trust
Company of New York entitled to vote at the stockholders' meeting at which such
votes were cast, with relation to the proceedings provided for in said
Certificate, and that neither the certificate of incorporation nor any other
certificate filed pursuant to law requires a larger proportion of votes; and
that such votes were cast at a stockholders' meeting held at the principal place
of business of said Guaranty Trust Company of New York, 140 Broadway, New York,
N.Y., on January 21, 1953, upon notice pursuant to section forty-five of the
stock corporation law.
60
WILLIAM L. KLEITZ
STUART K. BARNES
Severally subscribed and sworn to before me this 21st day of January, 1953.
RUSSELL E. WEAVER
Notary Public, State of New York
No. 30-9556200
Cert. filed with Nassau & New York
County Clerks
Term Expires March 30, 1954
[NOTARIAL SEAL]
61
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM L. KLEITZ and ROBERT H. CRAFT, being duly sworn, depose and say, and
each for himself deposes and says, that he, WILLIAM L. KLEITZ, is the President
of Guaranty Trust Company of New York, and he, ROBERT H. CRAFT, is the Vice
President and Treasurer thereof, that the number of shares changed as provided
in subparagraph five of paragraph (c) of subdivision two of section thirty-five
and the par value thereof are 1,000,000 shares of the par value of $100 each and
the number of shares resulting from such change and the par value thereof are
5,000,000 shares of the par value of $20 each.
WILLIAM L. KLEITZ
ROBERT H. CRAFT
Severally sworn to before me this
21st day of January, 1953
RUSSELL E. WEAVER
Notary Public, State of New York
No. 30-9556200
Cert. filed with Nassau & New York
County Clerks
Term Expires March 30, 1954
[NOTARIAL SEAL]
STATE OF NEW YORK
BANKING DEPARTMENT
I, FRANCIS A. FLORIN, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate, entitled "Certificate of
Amendment of Certificate of Incorporation of GUARANTY TRUST COMPANY OF NEW YORK
pursuant to Section Thirty-six of the Stock Corporation Law," providing for an
increase in the number of shares of authorized capital stock from One Million
(1,000,000) shares to Five Million (5,000,000) shares, and for a reduction of
the par value of the shares from One Hundred (100) Dollars to Twenty (20)
Dollars per share.
WITNESS my hand and official seal of the Banking Department at the City of
Albany, this 22nd day of January in the Year of our Lord one thousand nine
hundred and fifty-three.
FRANCIS A. FLORIN
Deputy Superintendent of Banks
[SEAL]
62
<PAGE>
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW
We, the undersigned, being the President and the Secretary, respectively, of
GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called the "Corporation"),
hereby do subscribe, acknowledge and file this certificate, stating as follows:
1. The name of the Corporation is
GUARANTY TRUST COMPANY OF NEW YORK.
The name under which the Corporation was originally incorporated was New
York Guaranty and Indemnity Company.
2. The Corporation was created by a special law and has no certificate of
incorporation. The chapter number and year of passage of such law is Chapter
179, Laws of 1864.
3. The number of its authorized shares is increased from 5,000,000 shares of
the par value of $20 each to 6,000,000 shares of the par value of $20 each and
in conformity therewith the amount of its capital stock is increased from
$100,000,000 to $120,000,000 in accordance with the provisions of sub-paragraphs
(1) and (7) of Paragraph (C) of subdivision 2 of Section Thirty-five of the
Stock Corporation Law.
4. Paragraph 8 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 15, 1947, which now reads as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is One Hundred Million Dollars ($100,000,000) and all of the
shares are to have a par value."
is changed to read as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is One Hundred Twenty Million Dollars ($120,000,000) and all of
the shares are to have a par value."
63
<PAGE>
5. Paragraph 9 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 15, 1947, as changed by Paragraph 4 of the "Certificate of Amendment of
Certificate of Incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law" dated January 21, 1953, and
filed January 22, 1953, which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is five million (5,000,000)
shares, all of which are to be of one class of capital stock and all of
which are to have a par value of Twenty Dollars ($20) each."
is changed to read as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is six million (6,000,000)
shares, all of which are to be of one class of capital stock and all of
which are to have a par value of Twenty Dollars ($20) each."
Dated, January 16, 1957.
WILLIAM L. KLEITZ
President
STUART K. BARNES
Secretary
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 16th day of January, 1957, before me personally came WILLIAM L.
KLEITZ and STUART K. BARNES, to me known and known to me to be the individuals
described in and who subscribed and executed the foregoing Certificate, as
President and Secretary, respectively, of GUARANTY TRUST COMPANY OF NEW YORK,
and they severally acknowledged to me that they subscribed and executed the
same.
RUSSELL E. WEAVER
Notary Public, State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1958
[NOTARIAL SEAL]
64
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM L. KLEITZ and STUART K. BARNES, being duly and severally sworn, each
for himself deposes and says, that he, WILLIAM L. KLEITZ, is the President of
Guaranty Trust Company of New York, and he, STUART K. BARNES, is the Secretary
thereof; that they have been authorized to execute and file the foregoing
Certificate by the votes, cast in person or by proxy, of the holders of record
of a majority of the outstanding shares of said Guaranty Trust Company of New
York entitled to vote at the stockholders' meeting at which such votes were cast
with relation to the proceedings provided for in said Certificate, and that
neither the certificate of incorporation nor any other certificate filed
pursuant to law requires a larger proportion of votes; and that such votes were
cast at a stockholders' meeting held at the principal place of business of said
Guaranty Trust Company of New York, 140 Broadway, New York, N.Y., on January 16,
1957, upon notice pursuant to Section Forty-five of the Stock Corporation Law.
WILLIAM L. KLEITZ
STUART K. BARNES
Severally subscribed and sworn to before me this 16th day of January, 1957.
RUSSELL E. WEAVER
Notary Public, State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1958
[Notarial Seal]
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
WILLIAM L. KLEITZ, being duly sworn, deposes and says, that he, WILLIAM L.
KLEITZ, is the President of Guaranty Trust Company of New York; that the number
of additional shares, not resulting from a change of shares, which the
corporation is authorized to issue by the foregoing Certificate is 1,000,000,
that the number of such additional shares with par value is 1,000,000, and that
the par value thereof is $20 per share; that the number of shares changed as
provided in sub paragraph 5 of Paragraph (C) of Subdivision 2 of Section 35 of
the Stock Corporation Law is none; and that the number of shares not resulting
from a change of shares, of which the par value has been increased, is none.
WILLIAM L. KLEITZ
65
<PAGE>
Subscribed and sworn to before me this 16th day of January, 1957.
RUSSELL E. WEAVER
Notary Public, State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1958
[NOTARIAL SEAL]
I, GEORGE A. MOONEY, Superintendent of Banks of the State of New York, DO
HEREBY APPROVE the annexed Certificate entitled "Certificate of Amendment of
Certificate of Incorporation of GUARANTY TRUST COMPANY OF NEW YORK pursuant to
Section Thirty-six of the Stock Corporation Law" dated January 16, 1957,
providing for increase of capital stock from $100,000,000 to $120,000,000.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official
seal of the Banking Department at Albany, this 16th day of January, 1957.
GEORGE A. MOONEY
Superintendent of Banks
[SEAL]
66
<PAGE>
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW
--------
We, the undersigned, being the President and the Secretary, respectively, of
GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called the "Corporation"),
hereby do subscribe, acknowledge and file this certificate, stating as follows:
1. The name of the Corporation is Guaranty Trust Company of New York. The
name under which the Corporation was originally incorporated was New York
Guaranty and Indemnity Company.
2. The Corporation was created by a special law. The chapter number and year
of passage of such law is Chapter 179, Laws of 1864.
3. This certificate effects the following changes: the name of the
Corporation is changed to MORGAN GUARANTY TRUST COMPANY OF NEW YORK in
accordance with the provisions of Paragraph (A) of subdivision 2 of Section
Thirty-five of the Stock Corporation Law; 1,540,000 new shares of capital stock
with a par value of $25 per share are authorized, the par value of the 6,000,000
shares of capital stock presently authorized and issued is increased from $20
per share to $25 per share, and in conformity with the increase in the number of
shares and the increase in the par value of shares the amount of capital stock
of the Corporation is increased from $120,000,000 to $188,500,000, all in
accordance with the provisions of subparagraphs (1), (3) and (7) of Paragraph
(C) of subdivision 2 of Section Thirty-five of the Stock Corporation Law; and
the provision set forth in paragraph 7 of this Certificate of Amendment which
relates to the regulation of the business of the Corporation and conduct of its
affairs is adopted in accordance with the provisions of Paragraph (J) of
subdivision 2 of Section Thirty-five of the Stock Corporation Law.
4. Section I of Chapter 179, Laws of 1864, provided that the name of the
Corporation should be New York Guaranty and Indemnity Company, and the name of
the Corporation was changed to Guaranty Trust Company of New York by an Order
dated December 3, 1895 of the Supreme Court, New York County, which Order was
filed in the office of the Secretary of State on December 5, 1895. The name of
the Corporation shall henceforth be MORGAN GUARANTY TRUST COMPANY OF NEW YORK.
5. Paragraph 8 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 15, 1947, as changed by
67
<PAGE>
Paragraph 4 of the "Certificate of Amendment of Certificate of Incorporation
of Guaranty Trust Company of New York Pursuant to Section Thirty-six of the
Stock Corporation Law," dated and filed January 16, 1957, which now reads as
follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is One Hundred Twenty Million Dollars ($120,000,000) and all of
the shares are to have a par value."
is changed to read as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is One Hundred Eighty-eight Million Five Hundred Thousand
Dollars ($188,500,000) and all of the shares are to have a par value."
6. Paragraph 9 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 15, 1947, as changed by Paragraph 4 of the "Certificate of Amendment of
Certificate of Incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law," dated January 21, 1953 and
filed January 22, 1953, and by Paragraph 5 of the "Certificate of Amendment of
Certificate of Incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law," dated and filed on January 16,
1.957, which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is six million (6,000,000)
shares, all of which are to be of one class of capital stock and all of
which are to have a par value of Twenty Dollars ($20) each."
is changed to read as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is seven million five hundred
forty thousand (7,540,000) shares, all of which are to be of one class
of capital stock and all of which are to have a par value of
Twenty-five Dollars ($25) each."
7. The following provision for the regulation of the business of the
Corporation and the conduct of its affairs is hereby adopted as a part of the
certificate of incorporation to supplement the special law creating the
Corporation:
"The Board of Directors may adopt, and from time to time alter or
amend, a plan or plans for additional compensation to the officers
(including officers who may be Directors) or other employees, or both,
of the Company or of any branch thereof or of any subsidiary all of the
capital stock of which (except for directors' qualifying shares) is
owned by the Company for services rendered to the Company or to any
branch thereof or to any such
68
<PAGE>
subsidiary, out of the operating earnings of the Company or of any
branch thereof or of an such subsidiary, in any fiscal year or part
thereof, determined as the Board of Director in their discretion may
see fit."
Dated: April 23, 1959.
DALE E. SHARP
President
STUART K. BARNES
Secretary
69
<PAGE>
STATE OF NEW YORK
BANKING DEPARTMENT
I, G. RUSSELL CLARK, Superintendent of Banks of the State of New York, DO
HEREBY APPROVE the annexed certificate entitled "Certificate of Amendment of
Certificate of Incorporation of GUARANTY TRUST COMPANY OF NEW YORK, pursuant to
Section Thirty-six of the Stock Corporation Law" dated April 23, 1959, providing
for (1) a change of name from Guaranty Trust Company of New York to Morgan
Guaranty Trust Company of New York; and, (2) an increase in capital stock from
One Hundred Twenty Million ($120,000,000) Dollars, consisting of six million
(6,000,000) shares of the par value of $20.00 each to One Hundred Eighty-eight
Million, Five Hundred Thousand ($188,500,000) Dollars, consisting of seven
million, five hundred forty thousand (7,540,000) shares of the par value of
$25.00 each; and, (3) to add a new provision relating to the regulation of the
corporation's business and the conduct of its affairs.
WITNESS my hand and official seal of the Banking
Department at the City of Albany, this 24th day
of April in the Year of our Lord one thousand
nine hundred and fifty-nine.
G. RUSSELL CLARK
Superintendent of Banks
[SEAL]
70
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
On this 23rd day of April, 1959, before, me personally came DALE E. SHARP
AND STUART K. BARNES, to me known and known to me to be the individuals
described in and who subscribed and executed the foregoing Certificate, as
President and Secretary, respectively, of GUARANTY TRUST COMPANY OF NEW YORK,
and they severally acknowledged to me that they subscribed and executed the
same.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1960
[NOTARIAL SEAL]
71
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
DALE E. SHARP and STUART K. BARNES, being duly and severally sworn, each for
himself deposes and says, that he, DALE E. SHARP, is the President of Guaranty
Trust Company of New York, and he, STUART K. BARNES, is the Secretary thereof;
that they have been authorized to execute and file the foregoing Certificate by
the votes, cast in person or by proxy, of the holders of record of two-thirds of
the outstanding shares of said Guaranty Trust Company of New York entitled to
vote at the stockholders' meeting at which such votes were cast with relation to
the proceedings provided for in said Certificate, and that neither the special
law creating the corporation nor any other certificate filed pursuant to law
requires a larger proportion of votes; and that such votes were cast at a
stockholders' meeting held at 60 Liberty Street, New York, N. Y., on March 4,
1959, upon notice pursuant to Section Forty-five of the Stock Corporation Law.
DALE E. SHARP
STUART K. BARNES
Severally subscribed and sworn to before me this 23rd day of April, 1959.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1960
[NOTARIAL SEAL]
72
<PAGE>
STATE OF NEW YORK } ss.:
COUNTY OF NEW YORK
DALE, E. SHARP and RALPH F. LEACH, being duly and severally sworn, each for
himself deposes and says, that he, DALE E. SHARP, is the President of Guaranty
Trust Company of New York, and he, RALPH F. LEACH, is the Treasurer thereof; and
that by resolution of the Board of Directors of said Guaranty Trust Company of
New York a sum at least equal to the amount of increase of the aggregate par
value of its issued shares provided for in the foregoing Certificate has been
transferred from surplus to capital.
DALE E. SHARP
RALPH F. LEACH
Severally subscribed and sworn to before me
this 23rd day of April, 1959.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1960
[NOTARIAL SEAL]
73
<PAGE>
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
DALE E. SHARP, being duly sworn, deposes and says, that he, DALE E. SHARP,
is the President of Guaranty Trust Company of New York; that the number of
additional shares which the Corporation is authorized to issue by the foregoing
Certificate is 1,540,000, that the number of such additional shares with par
value is 1,540,000, and that the par value thereof is $25 per share; that the
number of shares changed as provided in sub-paragraph 5 of Paragraph (C) of
subdivision 2 of Section 35 of the Stock Corporation Law is none; and that the
number of shares, not resulting from a change of shares, of which the par value
has been increased is 6,000,000, and the amount of such increase in par value is
$5 per share.
DALE E. SHARP
Subscribed and sworn to before me
this 23rd day of April, 1959.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1960
[NOTARIAL SEAL]
74
<PAGE>
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
PURSUANT TO SECTION THIRTY-SIX
OF THE STOCK CORPORATION LAW
--------
We, the undersigned, being the President and the Secretary, respectively,
of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called the
"Corporation"), hereby do subscribe, acknowledge and file this certificate,
stating as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally incorporated was New
York Guaranty and Indemnity Company.
2. The Corporation was created by a special law. The chapter number and
year of passage of such law is Chapter 179, Laws of 1864.
3. The number of its authorized shares is increased from 7,540,000 shares
of the par value of $25 each to 8,294,000 shares of the par value of $25 each
and in conformity therewith the amount of its capital stock is increased from
$188,500,000 to $207,350,000 in accordance with the provisions of sub-paragraphs
(1) and (7) of Paragraph (C) of subdivision 2 of Section Thirty-five of the
Stock Corporation Law.
4. Paragraph 8 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 15, 1947, as changed by Paragraph 4 of the "Certificate of Amendment of
Certificate of incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law," dated and filed January 16,
1957, and as further changed by Paragraph 5 of the "Certificate of Amendment of
Certificate of Incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law," dated April 23, 1959, and
filed April 24, 1959, which now reads as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is One Hundred Eighty-eight Million Five Hundred Thousand Dollars
($188,500,000) and all of the shares are to have a par value."
is changed to read as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two
75
<PAGE>
Hundred Seven Million Three Hundred Fifty Thousand Dollars
($207,350,000) and all of the shares are to have a par value."
5. Paragraph 9 of the "Certificate of Increase of the Amount of Capital
Stock and Authorization of New Shares of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed
January 15, 1947, as changed by Paragraph 4 of the "Certificate of Amendment of
Certificate of Incorporation of Guaranty Trust Company of New York Pursuant to
Section Thirty-six of the Stock Corporation Law," dated January 21, 1953, and
filed January 22, 1953, as further changed by Paragraph 5 of the "Certificate of
Amendment of Certificate of Incorporation of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated and filed on
January 16, 1957, and as further changed by Paragraph 6 of the "Certificate of
Amendment of Certificate of Incorporation of Guaranty Trust Company of New York
Pursuant to Section Thirty-six of the Stock Corporation Law," dated April 23,
1959, and filed on April 24, 1959, which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is seven million five hundred
forty thousand (7,540,000) shares, all of which are to be of one class of
capital stock and all of which are to have a par value of Twenty-five
Dollars ($25) each."
is changed to read as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is eight million two hundred
ninety four thousand (8,294,000) shares, all of which are to be of one
class of capital stock and all of which are to have a par value of
Twenty-five Dollars ($25) each."
Dated, January 16, 1963.
THOMAS S. GATES
President
STUART K. BARNES
Secretary
STATE OF NEW YORK
COUNTY OF NEW YORK
On this 16th day of January, 1963, before me personally came THOMAS S.
GATES and STUART K. BARNES, to me known and known to me to be the individuals
described in and who subscribed and executed the foregoing certificate, as
President and Secretary, respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW
YORK, and they severally acknowledged to me that they subscribed and executed
the same.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1964
[NOTARIAL SEAL]
STATE OF NEW YORK
COUNTY OF NEW YORK
THOMAS S. GATES AND STUART K. BARNES, being duly and severally sworn, each
for himself deposes and says, that he, THOMAS S. GATES, is the President of
Morgan Guaranty Trust Company of New York, and he, STUART K BARNES, is the
Secretary thereof ; that they have been authorized to execute and file the
foregoing Certificate by the votes cast in person or by proxy, of the holders of
record of a majority of the outstanding shares of said Morgan Guaranty Trust
Company of New York entitled to vote at the stockholders' meeting at which such
votes were cast with relation to the proceedings provided for in said
Certificate, and that neither the special law creating the Corporation nor any
other Certificate filed pursuant to law requires a larger proportion of votes;
and, that such votes were cast at a stockholders' meeting held at the principal
place of business of said Morgan Guaranty Trust Company of New York, 140
Broadway, New York, New York, on January 16, 1963, upon notice pursuant to
Section Fortyfive of the Stock Corporation Law.
THOMAS S. GATES
STUART K. BARNES
Severally subscribed and sworn to before me
this 16th day of January, 1963.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1964
[NOTARIAL SEAL]
77
<PAGE>
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
STUART K. BARNES, being duly sworn, deposes and says, that he, STUART K.
BARNES, is the Secretary of Morgan Guaranty Trust Company of New York; that the
number of additional shares, not resulting from a change of shares, which the
corporation is authorized to issue by the foregoing certificate is 754,000, that
the number of such additional shares with par value is 754,000, and that the par
value thereof is $25 per share; that the number of shares changed as provided in
subparagraph 5 of paragraph (c) of Subdivision 2 of Section 35 of the Stock
Corporation Law is none; and that the number of shares not resulting from a
change of shares, of which the par value has been increased, is none.
STUART K. BARNES
Subscribed and sworn to before me
this 16th day of January, 1963.
RUSSELL E. WEAVER
RUSSELL E. WEAVER
Notary Public
State of New York
#41-9556200
Qualified in Queens County
Term Expires March 30, 1964
[NOTARIAL SEAL]
I, OREN ROOT, Superintendent of Banks of the State of New York, DO HEREBY
APPROVE the annexed certificate entitled "Certificate of Amendment of
Certificate of Incorporation of MORGAN GUARANTY TRUST COMPANY OF NEW YORK
pursuant to Section Thirty-six of the Stock Corporation Law" dated January 16,
1963, providing for increase of capital stock from $188,500,000 to $207,350,000.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
official seal of the Banking Department at Albany, this 16th
day of January, 1963.
OREN ROOT
Superintendent of Banks
[SEAL]
78
<PAGE>
79
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
-------
We, the undersigned, being the President and the Secretary, respectively,
of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called the
"Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and year
of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate relating to
the amount of the Corporation's capital stock, which was last amended as set
forth in Paragraph 4 of the "Certificate of Amendment of Certificate of
Incorporation of Morgan Guaranty Trust Company of New York Pursuant to Section
Thirty-Six of the Stock Corporation Law", dated and filed on January 16, 1963,
and which now reads as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Seven Million Three Hundred Fifty Thousand Dollars
($207,350,000) and all of the shares are to have a par value."
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Twenty - eight Million Eighty - five Thousand
Dollars ($228,085,000) and all of the shares are to have a par value."
4. The provision of the Corporation's Organization Certificate relating to
the number of shares into which the Corporation's capital stock is divided and
the par value of such shares, which was last amended as set forth in Paragraph 5
of the "Certificate of Amendment of Certificate of Incorporation of Morgan
Guaranty Trust Company of New York Pursuant to Section Thirty-Six of the Stock
Corporation Law", dated and filed on January 16, 1963, and which now reads as
follows:
80
<PAGE>
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is eight million two hundred
ninety - four thousand (8,294,000) shares, all of which are to be of one
class of capital stock and all of which are to have a par value of
Twenty-five Dollars ($25) each."
is amended to read in full as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is nine million one hundred
twenty-three thousand four hundred (9,123,400) shares, all of which are to
be of one class of capital stock and all of which are to have a par value
of Twenty-five Dollars ($25) each."
5. The foregoing amendments were authorized by vote of the holders of a
majority of all outstanding shares entitled to vote thereon, at the annual
meeting of the stockholders of the Corporation held on March 17, 1965 at 15
Broad Street, New York, N. Y.
IN WITNESS WHEREOF, we have signed this Certificate on the 17th
day of March, 1965.
THOMAS S. GATES
President
STUART K. BARNES
Secretary
81
<PAGE>
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
STUART K. BARNES, being duly sworn, deposes and says that he is the
Secretary of MORGAN GUARANTY TRUST COMPANY OF NEW YORK, that he is one of the
persons who signed the foregoing Certificate; that he has read the foregoing
Certificate and knows the contents thereof; and that the statements contained
therein are true.
STUART K. BARNES
Sworn to before me this
17 day of March, 1965
CLEMENT R. BROWNE
Notary Public, State of New York
No. 24-0461005
Qualified in Kings County
Certificate Filed in New York Co.
Commission Expires March 30, 1965
[NOTARIAL SEAL]
I, FRANK WILLE, Superintendent of Banks of the State of New York, DO HEREBY
APPROVE the annexed certificate entitled "Certificate of Amendment of the
Organization Certificate of MORGAN GUARANTY TRUST COMPANY OF NEW YORK under
Section 8005 of the Banking Law" dated March 17, 1965, providing for increase of
capital stock from $207,350,000 to $228,085,000.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
official seal of the Banking Department at Albany, this 17th
day of March, 1965.
FRANK WILLE
Superintendent of Banks
[SEAL]
82
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
--------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and year
of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate relating to
the amount of the Corporation's capital stock, which was last amended as set
forth in Paragraph 3 of the "Certificate of Amendment of the Organization
Certificate of Morgan Guaranty Trust Company of New York Under Section 8005 of
the Banking Law", dated and filed on March 17, 1965, and which now reads as
follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Twenty-eight Million Eighty-five Thousand Dollars
($228,085,000) and all of the shares are to have a par value."
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Thirty-seven Million Five Hundred Thousand Dollars
($237,500,000) and all of the shares are to have a par value."
4. The provision of the Corporation's Organization Certificate relating to
the number of shares into which the Corporation's capital stock is divided and
the par value of such shares, which was last amended as set forth in Paragraph 4
of the "Certificate of Amendment of the Organization Certificate of Morgan
Guaranty Trust Company of New York Under Section 8005 of the Banking Law", dated
and filed on March 17, 1965, and which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is nine million one hundred
twenty-three thousand four
83
<PAGE>
hundred (9,123,400) shares, all of which are to be of one class of capital
stock and all of which are to have a par value of Twenty-five Dollars
($25) each."
is amended to read in full as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is nine million five hundred
thousand (9,500,000) shares, all of which are to be of one class of capital
stock and all of which are to have a par value of Twenty-five Dollars ($25)
each."
5. The foregoing amendments were authorized by written consent of the
holder of all of the outstanding shares of the Corporation entitled to vote
thereon, given pursuant to Section 6015 of the Banking Law.
IN WITNESS WHEREOF, we have signed this Certificate on the 8th day of
November, 1973.
ELLMORE C. PATTERSON
Chairman of the Board
BORIS S. BERKOVITCH
Secretary
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
BORIS S. BERKOVITCH, being duly sworn, deposes and says that he is the
Secretary of MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that he is one of the
persons who signed the foregoing Certificate; that he has read the foregoing
Certificate and knows the contents thereof; and that the statements contained
therein are true.
BORIS S. BERKOVITCH
Sworn to before me this
8th day of November, 1973.
VERONICA C. MILLER
Notary Public, State of New York
No. 30-4501960
Qualified in Nassau County
Certificate Filed in New York County
Commission Expires March 30, 1975
[NOTARIAL SEAL]
I, HARRY W. ALBRIGHT, JR., Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed certificate entitled "Certificate of
Amendment of the Organization
84
<PAGE>
Certificate of MORGAN GUARANTY TRUST COMPANY OF NEW YORK under Section 8005 of
the Banking Law" dated November 8, 1973, providing for increase of capital stock
from $228,085,000 to $237,500,000.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
official seal of the Banking Department at New York, N. Y.,
this 8 day of November, 1973.
HARRY W. ALBRIGHT, JR.
Superintendent of Banks
[SEAL]
85
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
--------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and year
of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate relating to
the amount of the Corporation's capital stock, which was last amended as set
forth in Paragraph 3 of the "Certificate of Amendment of the Organization
Certificate of Morgan Guaranty Trust Company of New York Under Section 8005 of
the Banking Law", dated and filed on November 8, 1973, and which now reads as
follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Thirty-seven Million Five Hundred Thousand Dollars
($237,500,000) and all of the shares are to have a par value."
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Fifty Million Dollars ($250,000,000) and all of the
shares are to have a par value."
4. The provision of the Corporation's Organization Certificate relating to
the number of shares into which the Corporation's capital stock is divided and
the par value of such shares, which was last amended as set forth in Paragraph 4
of the "Certificate of Amendment of the Organization Certificate of Morgan
Guaranty Trust Company of New York Under Section 8005 of the Banking Law", dated
and filed on November 8, 1973, and which now reads as follows:
86
<PAGE>
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth. have is nine million five hundred
thousand (9,500,000) shares, all of which are to be of one class of capital
stock and all of which are to have a par value of Twenty-five Dollars ($25)
each."
is amended to read in full as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is ten million (10,000,000)
shares, all of which are to be of one class of capital stock and all of
which are to have a par value of Twenty-five Dollars ($25) each."
5. The foregoing amendments were authorized by written consent of the
holder of all of the outstanding shares of the Corporation entitled to vote
thereon, given pursuant to Section 6015 of the Banking Law.
IN WITNESS WHEREOF, We have signed this Certificate on the 18th day of
March, 1976.
ELLMORE C. PATTERSON
Chairman of the Board
BORIS S. BERKOVITCH
Secretary
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
BORIS S. BERKOVITCH, being duly sworn, deposes and says that he is the
Secretary of MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that he is one of the
persons who signed the foregoing Certificate; that he has read the foregoing
Certificate and knows the contents thereof ; and that the statements contained
therein are true.
BORIS S. BERROVITCH
Sworn to before me this
18th day of March, 1976.
VERONICA C. MILLER
Notary Public, State of New York
No. 30-4501960
Qualified in Nassau County
Certificate filed in New York County
Commission Expires March 30, 1977
[NOTARIAL SEAL]
87
<PAGE>
I, JOHN G. HEIMANN, Superintendent of Banks of the State of New York, DO
HEREBY APPROVE the annexed certificate entitled "Certificate of Amendment of the
Organization Certificate of MORGAN GUARANTY TRUST COMPANY OF NEW YORK under
Section 8005 of the Banking Law" dated March 18, 1976, providing for increase of
capital stock from $237,500,000 to $250,000,000.
IN WITNESS WHEREOF, I have here
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
unto set my hand and affixed the
official seal of the Banking Department at New York, N. Y., this 18th
day of March, 1976.
JOHN G. HEIMANN
[SEAL] Superintendent of Banks
88
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
--------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and year
of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate relating to
the amount of the Corporation's capital stock, which was last amended as set
forth in Paragraph 3 of the "Certificate of Amendment of the Organization
Certificate of Morgan Guaranty Trust Company of New York Under Section 8005 of
the Banking Law" dated and filed on March 18, 1976 and which now reads as
follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Two Hundred Fifty Million Dollars ($250,000,000) and all of the
shares are to have a par value."
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Five Hundred Million Dollars ($500,000,000) and all of the
shares are to have a par value."
4. The provision of the Corporation's Organization Certificate relating to
the number of shares into which the Corporation's capital stock is divided and
the par value of such shares, which was last amended as set forth in Paragraph 4
of the "Certificate of Amendment of the Organization Certificate of Morgan
Guaranty Trust Company of New York Under Section 8005 of the Banking Law", dated
and filed on March 18, 1976 and which now reads as follows:
"9. The total number of shares, including those previously authorized,
which the Corporation may henceforth have is ten million (10,000,000)
shares, all of which are to
89
<PAGE>
be of one class of capital stock and all of which are to have a par value
of Twenty-five Dollars ($25) each."
is amended to read in full as follows:
"9. (a) (i) The total number of shares of all classes of capital stock
which the Corporation may henceforth have is twelve million five hundred
thousand shares, of which two million five hundred thousand shares shall be
shares of Preferred Stock of the par value of One Hundred Dollars ($100)
per share (hereinafter called "Preferred Stock"), and ten million shares
shall be shares of Common Stock of the par value of Twenty-five Dollars
($25) per share (hereinafter called "Common Stock").
(ii) The Corporation shall have the authority to issue at any time and
from time to time shares of Preferred Stock in one or more series, subject to
the limitation that, if the stated dividends and amounts payable on liquidation
are not paid in full, the shares of all series of the same class shall share
ratably in the payment of dividends including accumulations, if any, in
accordance with the sums which would be payable on such shares if all dividends
were declared and paid in full, and in any distribution of assets other than by
way of dividends in accordance with the sums which would be payable on such
distribution if all sums payable were discharged in full.
(iii) Except as otherwise required by law, the holders of the
Preferred Stock shall have no voting power whatsoever.
(iv) Dividends on outstanding Preferred Stock of each series shall be
declared and paid, or set apart for payment, before any dividends shall be
declared and paid, or set apart for payment, on the shares of Common Stock with
respect to the same dividend period.
(v) Upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, the holders of Preferred Stock
shall be entitled to receive out of the assets of the Corporation, before any
distribution shall be made to the holders of the Common Stock, the amounts
determined to be payable on the Preferred Stock of each series in the event of
voluntary or involuntary liquidation.
(b) There shall be a series of the class of the Corporation's Preferred
Stock designated as Adjustable Rate Cumulative Preferred Stock, Series A
(hereinafter referred to as the "Series A Preferred Stock") and the number of
shares constituting such series shall be two million five hundred thousand
(2,500,000).
(i) Dividends. Dividend rates on the shares of the Series A Preferred
Stock shall be: (A) for the period (the "Initial Dividend Period") from the
respective dates of original issue thereof to and including June 30, 1983, the
rate shall be 9.25% per annum, and (B) for each quarterly dividend period
(hereinafter referred to as a "Quarterly Dividend Period"; and the Initial
Dividend Period or any Quarterly Dividend Period being hereinafter individually
referred to as a "Dividend Period" and collectively referred to as "Dividend
Periods") thereafter, which
90
<PAGE>
Quarterly Dividend Periods shall commence on January 1, April 1, July 1 and
October 1 in each year and shall end on and include the day next preceding the
first day of the next Quarterly Dividend Period, at a rate per annum of the par
value thereof equal to the Applicable Rate (as defined in subparagraph (ii) ) in
respect of such Quarterly Dividend Period. Such dividends shall be cumulative
from the respective dates of original issue of such shares and shall be payable,
when and as declared by the Board of Directors, on March 31, June 30, September
30 and December 31 of each year, commencing June 30, 1983. Each such dividend
shall be paid to the holders of record of shares of the Series A Preferred Stock
as they appear on the stock register of the Corporation on such record date, not
exceeding 30 days preceding the payment date thereof, as shall be fixed by the
Board of Directors' of the Corporation, or by a committee of said Board of
Directors duly authorized to fix such date. Dividends on account of arrears for
any past Dividend Periods may be declared and paid at any time, without
reference to any regular dividend payment date, to holders of record on such
date, not exceeding 45 days preceding the payment date thereof, as may be fixed
by the Board of Directors of the Corporation, or by a committee of said Board of
Directors duly authorized to fix such date. In the event that there shall be
outstanding shares of any other series of Preferred Stock, the Corporation, in
making any dividend payment on account of arrears on the Series A Preferred
Stock or such other series of Preferred Stock, shall make payments ratably upon
all outstanding shares of the Series A Preferred Stock and such other series of
Preferred Stock in proportion to the respective amounts of dividends in arrears
upon all such outstanding shares of the Series A Preferred Stock and such other
series of Preferred Stock to the date of such dividend payment. No interest, or
sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments which may be in arrears.
Dividends payable on the Series A Preferred Stock for each full Quarterly
Dividend Period shall be computed by dividing the Applicable Rate by four.
Dividends payable on the Series A Preferred Stock for any period less than a
full Quarterly Dividend Period, and for the portion, if any, of the Initial
Dividend Period prior to April 1, 1983, shall be computed on the basis of a 360
day year of four 90 day quarters and the actual number of days elapsed in the
period for which payable.
(ii) Definition of Applicable Rate, etc. Except as provided below in
this subparagraph, the "Applicable Rate" for any Quarterly Dividend Period shall
be (A) 4.875% less than (B) the highest of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Twenty Year Constant Maturity Rate (each as
hereinafter defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason
(I) any one of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate or the Twenty Year Constant Maturity. Rate cannot be determined for
any Quarterly Dividend Period, then the Applicable Rate for such Dividend
Period shall be 4.875% less than the higher of whichever two of such Rates
can be so determined;
(II) only one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Twenty Year Constant Maturity Rate can be determined
for any Quarterly Dividend Period,
92
<PAGE>
then the Applicable Rate for such Dividend Period shall be 4.875% less
than whichever such Rate can be so determined; or
(III) none of the Treasury Bill Rate, the Ten Year Constant Maturity Rate
and the Twenty Year Constant Maturity Rate can be determined for any Quarterly
Dividend Period, then the Applicable Rate in effect for the preceding Dividend
Period shall be continued for such Dividend Period.
Anything herein to the contrary notwithstanding, the Applicable Rate for any
Quarterly Dividend Period shall in no event be less than 5.00% per annum or
greater than 11.50% per annum.
Except as provided below in this paragraph, the "Treasury Bill Rate" for
each Quarterly Dividend Period shall be the arithmetic average of the two most
recent weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate shall be published during the
relevant Calendar Period (as hereinafter defined) as provided below) for
three-month U.S. Treasury bills, as published weekly by the Federal Reserve
Board during the Calendar Period immediately prior to the last ten calendar days
of March, June, September or December, as the case may be, prior to the
Quarterly Dividend Period for which the dividend rate on the Series A Preferred
Stock is being determined. In the event that the Federal Reserve Board does not
publish such a weekly per annum market discount rate during such Calendar
Period, then the Treasury Bill Rate for such Dividend Period shall be the
arithmetic average of the two most recent weekly per annum market discount rates
(or the one weekly per annum market discount rate, if only one such rate shall
be published during the relevant Calendar Period as provided below) for
three-month U.S. Treasury bills, as published weekly during such Calendar Period
by any Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that a per annum market discount rate
for three-month U.S. Treasury bills shall not be published by the Federal
Reserve Board or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the Treasury Bill Rate
for such Dividend Period shall be the arithmetic average of the two most recent
weekly per annum market discount rates (or the one weekly per annum market
discount rate, if only one such rate shall be published during the relevant
Calendar Period as provided below) for all of the U.S. Treasury bills then
having maturities of not less than 80 nor more than 100 days, as finally
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board shall not publish such rates, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason no
such U.S. Treasury bill rates are published as provided above during such
Calendar Period, then the Treasury Bill Rate for such Dividend Period shall be
the arithmetic average of the per annum market discount rates based upon the
closing bids during such Calendar Period for each of the issues of marketable
non-interest bearing U.S. Treasury securities with a maturity of not less than
80 nor more than 100 days from the date of each such quotation, as quoted daily
for each business day in New York City (or less frequently if daily quotations
shall not be generally available) to the Corporation by at least three
recognized U.S. Government securities dealers selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason the
Corporation cannot determine the Treasury Bill Rate for any Quarterly Dividend
Period as provided above in this
92
<PAGE>
paragraph, the Treasury Bill Rate for such Dividend Period shall be the
arithmetic average of the per annum market discount rates based upon the closing
bids during such Calendar Period for each of the issues of marketable,
interest-bearing U.S. Treasury securities with a maturity of not less than 80
nor more than 100 days, as quoted daily for each business day in New York City
(or less frequently if daily quotations shall not be generally available) to the
Corporation by at least three recognized U.S. Government securities dealers
selected by the Corporation.
Except as provided below in this paragraph, the "Ten Year Constant Maturity
Rate" for each Quarterly Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields (or the one weekly per
annum Ten Years Average Yield, if only one such Yield shall be published during
the relevant Calendar Period as provided below), as published weekly by the
Federal Reserve Board during the Calendar Period immediately prior to the last
ten calendar days of March, June, September or December, as the case may be,
prior to the Quarterly Dividend Period for which the dividend rate on the Series
A Preferred Stock is being determined. In the event that the Federal Reserve
Board does not publish such a weekly per annum Ten Year Average Yield during
such Calendar Period, then the Ten Year Constant Maturity Rate for such Dividend
Period shall be the arithmetic average of the two most recent weekly per annum
Ten Year Average Yields (or the one weekly per annum Ten Year Average Yield, if
only one such Yield shall be published during the relevant Calendar Period as
provided below), as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by the
Corporation. In the event that a per annum Ten Year Average Yield shall not be
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the Ten
Year Constant Maturity Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum average yields to maturity (or
the one weekly average yield to maturity, if only one such yield shall be
published during the relevant Calendar Period as provided below) for all of the
actively traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities (as hereinafter defined)) then having maturities of not
less than eight nor more than twelve years, as finally published during such
Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board
shall not publish such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the event that
the Corporation determines in good faith that for any reason the Corporation
cannot determine the Ten Year Constant Maturity Rate for any Quarterly Dividend
Period as provided above in this paragraph, then the Ten Year Constant Maturity
Rate for such Dividend Period shall be the arithmetic average of the per annum
average yields to maturity based upon the closing bids during such Calendar
Period for each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a final maturity
date not less than eight nor more than twelve years from the date of each such
quotation, as quoted daily for each business day in New York City (or less
frequently if daily quotations shall not be generally available) to the
Corporation by at least three recognized U.S. Government securities dealers
selected by the Corporation.
Except as provided below in this paragraph, the "Twenty Year Constant
Maturity Rate" for each Quarterly Dividend Period shall be the arithmetic
average of the two most recent weekly per annum Twenty Year Average Yields (or
the one weekly per annum Twenty Year Average Yield, if only one such Yield shall
be published during, the relevant Calendar Period as provided below), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately prior to the last ten calendar days of March, June, September or
December, as the case may be, prior to, the Quarterly Dividend Period for which
the dividend rate on the Series A Preferred Stock is being determined. In the
event that the Federal Reserve Board does not publish such a weekly per annum
Twenty Year Average Yield during such Calendar Period, then the Twenty Year
Constant Maturity Rate for such Dividend Period shall be the arithmetic average
of the two most recent weekly per annum. Twenty Year Average Yields (or the one
weekly per annum. Twenty Year Average
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<PAGE>
Yield, if only one such Yield shall be published during the relevant Calendar
Period as provided below), as published weekly during such Calendar Period by
any Federal Reserve Bank or by any U.S. Government department or agency selected
by the Corporation. In the event that a per annum. Twenty Year Average Yield
shall not be published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such Calendar Period,
then the Twenty Year Constant Maturity Rate for such Dividend Period shall be
the arithmetic average of the two most recent weekly per annum average yields to
maturity (or the one weekly average yield to maturity, if only one such yield
shall be published during the relevant Calendar Period as provided below) for
all of the actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) then having maturities of not less
than eighteen nor more than twenty-two years, as finally published during such
Calendar Period, by the Federal Reserve Board or, if the Federal Reserve Board
shall not publish such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the event that
the Corporation determines in good faith that for any reason the Corporation
cannot determine the Twenty Year Constant Maturity Rate for any Quarterly
Dividend Period as provided above in this paragraph, then the Twenty Year
Constant Maturity Rate for such Dividend Period shall be the arithmetic average
of the per annum. average yields to maturity based upon the closing bids during
such Calendar Period for each of the issues of actively traded marketable U.S.
Treasury fixed interest rate securities (other than Special Securities) with a
final maturity date not less than eighteen nor more than twenty-two years from
the date of each such quotation, as quoted daily for each business day in New
York City (or less frequently if daily quotations shall not be generally
available) to the Corporation by at least three recognized U.S. Government
securities dealers selected by the Corporation.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Twenty
Year Constant Maturity Rate shall each be rounded to the nearest five hundredths
of a percentage point.
The Applicable Rate with respect to each Quarterly Dividend Period shall be
calculated as promptly as practicable by the Corporation according to the
appropriate method described herein. The Corporation shall cause notice of each
Applicable Rate to be enclosed with the dividend payment checks next mailed to
the holders of the Series A Preferred Stock.
For purposes of this paragraph, the term
(A) "Calendar Period" shall mean 14 calendar days;
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(B) "Special Securities" shall mean securities which can, at the
option of the holder, be surrendered at face value in payment of. any
Federal estate tax or which provide tax benefits to the holder and are
priced to reflect such tax benefits or which were originally issued at a
deep or substantial discount;
(C) "Ten Year Average Yield" shall mean the average yield to maturity
for actively traded marketable U.S. Treasury fixed interest rate securities
(adjusted to constant maturities of ten years) ; and
(D) "Twenty Year Average Yield" shall mean the average yield to
maturity for actively traded marketable U.S. Treasury fixed interest rate
securities (adjusted to constant maturities of twenty years).
(iii) Redemption. The Series A Preferred Stock shall not be redeemable
prior to March 1, 1986. On or after March 1, 1986, the Corporation, at its
option, may redeem the Series A Preferred Stock, as a whole or in part, at any
time or from time to time, at a redemption price (A) in the case of any
redemption on a redemption date from March 1, 1986 to February 29, 1988,
inclusive of $103.00 per share, and (B) in the case of any redemption on a
redemption date occurring on or after March 1, 1988, of $100.00 per share, plus,
in each case, accrued and unpaid dividends thereto to the date fixed for
redemption.
In the event the Corporation shall redeem shares of Series A Preferred
Stock, notice of such redemption shall be given by first class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the redemption
date, to each holder of record of the shares to be redeemed, at such holder's
address as the same appears on the stock register of the Corporation. Each such
notice shall state: (1) the redemption date; (2) the number of shares of Series
A Preferred Stock to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from such
holder; (3) the redemption price; (4) the place or places where certificates for
such shares are to be surrendered for payment of the redemption price; and (5)
that dividends on the shares to be redeemed will cease to accrue on such
redemption date. Notice having been mailed as aforesaid, from and after the
redemption date (unless default shall be made by the Corporation in providing
money for the payment of the redemption price) dividends on the shares of the
Series A Preferred Stock so called for redemption shall cease to accrue, and
said shares shall no longer be deemed to be outstanding, and all rights of the
holders thereof as stockholders of the Corporation (except the right to receive
from the Corporation the redemption price) shall cease. Upon surrender in
accordance with said notice of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors of the
Corporation shall so require and the notice shall so state), such shares shall
be redeemed by the Corporation at the redemption price aforesaid. If less than
all the outstanding shares of the Series A Preferred Stock are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
shares of Series A Preferred Stock not previously called for redemption by lot
or pro rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable. A new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.
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Notwithstanding the foregoing provisions of this subparagraph (iii), if any
dividends on the Series A Preferred Stock are in arrears, no shares of the
Series A Preferred Stock shall be redeemed unless all outstanding shares of the
Series A Preferred Stock are simultaneously redeemed, and the Corporation shall
not purchase or otherwise acquire any shares of such Series; provided, however,
that the foregoing shall not prevent the purchase or acquisition of shares of
the Series A Preferred Stock pursuant to a purchase or exchange offer made on
the same terms to holders of all outstanding shares of the Series A Preferred
Stock.
(iv) Shares to be Retired. All shares of the Series A Preferred Stock
redeemed by the Corporation shall be retired and cancelled and shall be restored
to the status of authorized but unissued shares of preferred stock, without
designation as to series, and may thereafter be issued.
(v) Conversion or Exchange. The holders of shares of the Series A
Preferred Stock shall not have any rights to convert such shares into or
exchange such shares for shares of any other class or classes or of any other
series of any class or classes of capital stock of the Corporation.
(vi) Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, the
holders of the Series A Preferred Stock shall be entitled to receive out of the
assets of the Corporation available for distribution to stockholders, before any
distribution of assets shall be made to the holders of Common Stock or of any
other shares of stock of the Corporation ranking as to such a distribution
junior to the Series A Preferred Stock, an amount equal to $100 per share plus
an amount equal to any accrued and unpaid dividends thereon (whether or not
earned or declared) to the date fixed for payment of such distribution. If upon
any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the amounts payable with respect to the Series A Preferred Stock
and any other shares of stock of the Corporation ranking as to any such
distribution on a parity with the Series A Preferred Stock are not paid in full,
the holders of the Series A Preferred Stock and of such other shares shall share
ratably in any such distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are entitled. After
payment to the holders of the Series A Preferred Stock of the full preferential
amounts provided for in this subparagraph (vi) the holders of the Series A
Preferred Stock shall be entitled to no further participation in any
distribution of assets by the Corporation.
Neither the sale, conveyance, exchange or transfer of all or substantially
all the property or business of the Corporation, the merger or consolidation of
the Corporation into or with any other corporation nor the merger or
consolidation of any other corporation into or with the Corporation shall be
deemed to be a dissolution, liquidation or winding up, voluntary or involuntary,
of the Corporation for the purposes of this subparagraph (vi).
(vii) Limitation on Dividends on Junior Ranking Stock. So long as any
of the Preferred Stock shall be outstanding, the Corporation shall not declare
any dividends on the Common Stock of the Corporation or any other stock of the
Corporation ranking as to dividends or distribution of assets junior to the
Preferred Stock (as defined below, the "Junior Stock"), or
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make any payment on account of, or set apart money for, a sinking or other
analogous fund for the purchase, redemption or other retirement of any shares of
Junior Stock, or make any distribution in respect thereof, whether in cash or
property or in obligations or stock of the Corporation, other than Junior Stock
(such dividends, payments, setting apart and distributions being herein called
"Junior Stock Payments"), unless full cumulative dividends shall have been paid
or declared and set apart for payment upon all outstanding shares of preferred
stock other than Junior Stock, at the date of such declaration in the case of
any such dividend, or the date of such setting apart in the case of any such
fund, or the date of such payment or distribution in the case of any other
Junior Stock Payment.
(viii) Ranking of Stock of the Corporation. For purposes of this
paragraph, any stock of any class or classes of the Corporation shall be deemed
to rank:
(A) prior to the shares of the Preferred Stock, either as to dividends or
upon liquidation, if the holders of such class or classes shall be entitled to
the receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, as the case may be, in preference
or priority to the holders of shares of the Preferred Stock;
(B) on a parity with shares of the Preferred Stock, either as to dividends
or upon liquidation, whether or not the dividend rates, dividend payment dates
or redemption or liquidation prices per share or sinking fund provisions, if
any, be different from those of the Preferred Stock, if the holders of such
stock shall be entitled to the receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation, as the case may
be, in proportion to their respective dividend rates or liquidation prices,
without preference or priority, one over the other, as between the holders of
such stock and the holders of shares of the Preferred Stock; and
(C) junior to shares of the Preferred Stock, either as to dividends or upon
liquidation, if such class shall be Common Stock or if the holders of shares of
the Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, as
the case may be, in preference or priority to the holders of shares of such
class or classes."
5. The foregoing amendments were authorized by written consent of the older
of all of the outstanding shares of the Corporation entitled to vote thereon,
given pursuant to Section 6015 of the Banking Law.
IN WITNESS WHEREOF, we have signed this Certificate on the 15th day of
March, 1983.
LEWIS T. PRESTON
Chairman of the Board
JAMES D. GOODPASTURE
Secretary
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STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
JAMES D. GOODPASTURE, being duly sworn, deposes and says that he is the
Secretary of MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that he is one of the
persons who signed the foregoing Certificate; that he has read the foregoing
Certificate and knows the contents thereof; and that the statements therein are
true.
JAMES D. GOODPASTURE
Sworn to before me this
15th day of March, 1983
JUNE V. SANNA
Notary Public, State of New York
No. 43-8760285
Qualified in Richmond County
Certificate filed in New York County
Commission Expires March 30, 1984
[NOTARIAL SEAL]
I, PETER M. PHILBIN, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE annexed certificate entitled "Certificate of Amendment
of the Organization Certificate of MORGAN GUARANTY TRUST COMPANY OF NEW YORK
under Section 8005 of the Banking Law" dated March 15, 1983 providing for an
increase in the capital structure from 10,000,000 shares of one class of stock
of the par value of $25 each, for a total capital stock value of $250,000,000 to
12,500,000 shares of stock consisting of 10,000,000 shares of common stock of
the par value of $25 each and 2,500,000 shares of a new class of preferred stock
and a series of such preferred stock to be designated as "Cumulative Adjustable
Rate Preferred Stock, Series A" at a par value of $100 each, for a total capital
stock value of $500,000,000.
WITNESS, my hand and official seal of the Banking Department at the City
of New York, this 24th day of March in the Year of our Lord one
thousand nine hundred and eighty-three.
PETER M. PHILBIN
Deputy Superintendent of Banks
[SEAL]
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CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
--------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, Of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and
year of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate
relating to the amount of the Corporation's capital stock, which was last
amended as set forth in Paragraph 3 of the "Certificate of Amendment of the
Organization Certificate of Morgan Guaranty Trust Company of New York Under
Section 8005 of the Banking Law", filed on March 24, 1983, and which now reads
as follows:
"8. The amount of the capital stock which the Corporation is hereafter
to have is Five Hundred Million Dollars ($500,000,000) and all of the
shares are to have a par value.
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
authorized to have is Five Hundred Million Dollars ($500,000,000) and all
of the shares are to have a par value. "
4. The provision of the Corporation's Organization Certificate
relating to the number of shares into which the Corporation's capital stock is
divided and the par value of such shares, which was last amended as set forth in
Paragraph 4 of the "Certificate of Amendment of the Organization Certificate of
Morgan Guaranty Trust Company of New York Under Section 8005 of the Banking
Law", filed on March 24, 1983 and which now reads as follows:
"9.(a)(I) The total number of shares of all classes of capital stock
which the Corporation may henceforth have is twelve million five hundred
thousand shares, of
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which two million five hundred thousand shares shall be shares of
Preferred Stock of the par value of One Hundred Dollars ($100)
per share (hereinafter called "Preferred Stock"), and ten million shares
shall be shares of Common Stock of the par value of Twenty-five Dollars
($25) per share (hereinafter called "Common Stock").
(ii) The Corporation shall have the authority to issue at any time and
from time to time shares of Preferred Stock in one or more series, subject to
the limitation that, if the stated dividends and amounts payable on liquidation
are not paid in full, the shares of all series of the same class shall share
ratably in the payment of dividends including accumulations, if any, in
accordance with the sums which would be payable on such shares if all dividends
were declared and paid in full, and in any distribution of assets other than by
way of dividends in accordance with the sums which would be payable on such
distribution if all sums payable were discharged in full.
(iii) Except as otherwise required by law, the holders of the
Preferred Stock shall have no voting power whatsoever.
(iv) Dividends on outstanding Preferred Stock of each series shall be
declared and paid, or set apart for payment, before any dividends shall be
declared and paid, or set apart for payment, on the shares of Common Stock with
respect to the same dividend period.
(v) Upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, the holders of Preferred Stock
shall be entitled to receive out of the assets of the Corporation, before any
distribution shall be made to the holders of the Common Stock, the amounts
determined to be payable on the Preferred Stock of each series in the event of
voluntary or involuntary liquidation.
(b) There shall be a series of the class of the Corporation's Preferred
Stock designated as Adjustable Rate Cumulative Preferred Stock, Series A
(hereinafter referred to as the "Series A Preferred Stock") and the number of
shares constituting such series shall be two million five hundred thousand
(2,500,000).
(i) Dividends. Dividend rates on the shares of the Series A Preferred
Stock shall be: (A) for the period (the "Initial Dividend Period") from the
respective dates of original issue thereof to and including June 30, 1983, the
rate shall be 9.25% per annum, and (B) for each quarterly dividend period
(hereinafter referred to as a "Quarterly Dividend Period"; and the Initial
Dividend Period or any Quarterly Dividend Period being hereinafter individually
referred to as a "Dividend Period" and collectively referred to as "Dividend
Periods") thereafter, which Quarterly Dividend Periods shall commence on January
1, April 1, July 1 and October 1 in each year and shall end on and include the
day next preceding the first day of the next Quarterly Dividend Period, at a
rate per annum of the par value thereof equal to the Applicable Rate (as defined
in subparagraph (ii) in respect of such Quarterly Dividend Period. Such
dividends shall be cumulative from the respective dates of original issue of
such shares and shall be payable, when and as declared by the Board of
Directors, on March 31, June 30, September 30 and December 31 of each year,
commencing June 30, 1983. Each such dividend shall be paid to the holders of
record of shares of the Series A Preferred Stock as they appear on the stock
register of the Corporation on such record date, not exceeding 30 days preceding
the payment date thereof, as shall be fixed by the Board of Directors of the
Corporation, or by a committee of said Board of Directors duly authorized to fix
such date. Dividends on account of arrears for any past Dividend Periods may be
declared and paid at any time, without reference to any regular dividend payment
date, to
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holders of record on such date, not exceeding 45 days preceding the payment date
thereof, as may be fixed by the Board of Directors of the Corporation, or by a
committee of said Board of Directors duly authorized to fix such date. In the
event that there shall be outstanding shares of any other series of Preferred
Stock, the Corporation, in making any dividend payment on account of arrears on
the Series A Preferred Stock or such other series of Preferred Stock, shall make
payments ratably upon all outstanding shares of the Series A Preferred Stock and
such other series of Preferred Stock in proportion to the respective amounts of
dividends in arrears upon all such outstanding shares of the Series A Preferred
Stock and such other series of Preferred Stock to the date of such dividend
payment. No interest, or sum of money in lieu of interest, shall be payable in
respect of any dividend payment or payments which may be in arrears.
Dividends payable on the Series A Preferred Stock for each full Quarterly
Dividend Period shall be computed by dividing the Applicable Rate by four.
Dividends payable on the Series A Preferred Stock for any period less than a
full Quarterly Dividend Period, and for the portion, if any, of the Initial
Dividend Period prior to April 1, 1983, shall be computed on the basis of a 360
day year of four 90 day quarters and the actual number of days elapsed in the
period for which payable.
(ii) Definition of Applicable Rate, etc. Except as provided below on
this subparagraph, the "Applicable Rate" for any Quarterly Divided Period shall
be (A) 4.875% less than (B) the highest of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Twenty Year Constant Maturity Rate (each as
hereinafter defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason
(I) any one of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate or the Twenty Year Constant Maturity Rate cannot be determined for any
Quarterly Dividend Period, then the Applicable Rate for such Dividend
Period shall be 4.875% less than the higher of whichever two of such Rates
can be so determined;
(II) only one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Twenty Year Constant Maturity Rate can be determined
for any Quarterly Dividend Period, then the Applicable Rate for such
Dividend Period shall be 4.875% less than whichever such Rate can be so
determined; or
(III) none of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate and the Twenty Year Constant Maturity Rate can be determined for any
Quarterly Dividend Period, then the Applicable Rate in effect for the
preceding Dividend Period shall be continued for such Dividend Period.
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Anything herein to the contrary notwithstanding, the Applicable Rate for any
Quarterly Dividend Period shall in no event be less than 5.00% per annum or
greater than 11.50% per annum.
Except as provided below in this paragraph, the "Treasury Bill Rate" for
each Quarterly Dividend Period shall be the arithmetic average of the two most
recent weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate shall be published during the
relevant Calendar Period (as hereinafter defined) as provided below) for
three-month U.S. Treasury bills, as published weekly by the Federal Reserve
Board during the Calendar Period immediately prior to the last ten calendar days
of' March, June, September or December, as the case may be, prior to the
Quarterly Dividend Period for which the dividend rate on the Series A Preferred
Stock is being determined. In the event that the Federal Reserve Board does not
publish such a weekly per annum market discount rate during such Calendar
Period, then the Treasury Bill Rate for such Dividend Period shall be the
arithmetic average of the two most recent weekly per annum market discount rates
(or the one weekly per annum market discount rate, if only one such rate shall
be published during the relevant Calendar Period as provided below) for
three-month U.S. Treasury bills, as published weekly during such Calendar Period
by any Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that a per annum market discount rate
for three-month U.S. Treasury bills shall not be published by the Federal
Reserve Board or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the Treasury Bill Rate
for such Dividend Period shall be the arithmetic average of the two most recent
weekly per annum market discount rates (or the one weekly per annum market
discount rate, if only one such rate shall be published during the relevant
Calendar Period as provided below) for all of the U.S. Treasury bills then
having maturities of not less than 80 nor more than 100 days, as finally
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board shall not publish such rates, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason no
such U.S. Treasury bill rates are published as provided above during such
Calendar Period, then the Treasury Bill Rate for such Dividend Period shall be
the arithmetic average of the per annum market discount rates based upon the
closing bids during such Calendar Period for each of the issues of marketable
non-interest bearing U.S. Treasury securities with a maturity of not less than
80 nor more than 100 days from the date of each such quotation, as quoted daily
for each business day in New York City (or less frequently if daily quotations
shall not be generally available) to the Corporation by at least three
recognized U.S. Government securities dealers selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason the
Corporation cannot determine the Treasury Bill Rate for any Quarterly Dividend
Period as provided above in this paragraph, the Treasury Bill Rate for such
Dividend Period shall be the arithmetic average of the per annum market discount
rates based upon the closing bids during such Calendar Period for each of the
issues of marketable interest-bearing U.S. Treasury securities with a maturity
of not less than 80 nor more than 100 days, as quoted daily for each business
day in New York City (or less frequently if daily quotations shall not be
generally available) to the Corporation by at least three recognized U.S.
Government securities dealers selected by the Corporation.
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Except as provided below in this paragraph, the Ten Year Constant Maturity
Rate" for each Quarterly Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields (or the one weekly per
annum Ten Year Average Yield, if only one such Yield shall be published during
the relevant Calendar Period as provided below), as published weekly by the
Federal Reserve Board during the Calendar Period immediately prior to the last
ten calendar days of March, June, September or December, as the case may be,
prior to the Quarterly Dividend Period for which the dividend rate on the Series
A Preferred Stock is being determined. In the event that the Federal Reserve
Board does not publish such a weekly per annum Ten Year Average Yield during
such Calendar Period, then the Ten Year Constant Maturity Rate for such Dividend
Period shall be the arithmetic average of the two most recent weekly per annum
Ten Year Average Yields (or the one weekly per annum Ten Year Average Yield, if
only one such Yield shall be published during the relevant Calendar Period as
provided below), as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by the
Corporation. In the event that a per annum Ten Year Average Yield shall not be
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the Ten
Year Constant Maturity Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum average yields to maturity (or
the one weekly average yield to maturity, if only one such yield shall be
published during the relevant Calendar Period as provided below) for all of the
actively traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities (as hereinafter defined)) then having maturities of not
less than eight nor more than twelve years, as finally published during such
Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board
shall not publish such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the event that
the Corporation determines in good faith that for any reason the Corporation
cannot determine the Ten Year Constant Maturity Rate for any Quarterly Dividend
Period as provided above in this paragraph, then the Ten Year Constant Maturity
Rate for such Dividend Period shall be the arithmetic average of the per annum
average yields to maturity based upon the closing bids during such Calendar
Period for each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Security per annum Ten Year Average
Yield shall not be published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency during such Calendar
Period, then the Ten Year Constant Maturity Rate for such Dividend Period shall
be the arithmetic average of the two most recent weekly per annum average yields
to maturity (or the one weekly average yield to maturity, if only one such yield
shall be published during the relevant Calendar Period as provided below) for
all of the actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities (as hereinafter defined)) then having
maturities of not less than eight nor more than twelve years, as finally
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board shall not publish such yields, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason the
Corporation cannot determine the Ten Year Constant Maturity Rate for any
Quarterly Dividend Period as provided above in this paragraph, then the Ten Year
Constant Maturity Rate for such Dividend Period shall be the arithmetic average
of the per annum average yields to maturity based upon the closing bids during
such Calendar Period for each of the issues
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of actively traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) with a final maturity date not less than eight
nor more than twelve years from the date of each such quotation, as quoted daily
for each business day in New York City (or less frequently if daily quotations
shall not be generally available) to the Corporation by at least three
recognized U.S. Government securities dealers selected by the Corporation.
Except as provided below in this paragraph, the "Twenty Year Constant
Maturity Rate" for each Quarterly Dividend Period shall be the arithmetic
average of the two most recent weekly per annum Twenty Year Average Yields (or
the one weekly per annum Twenty Year Average Yield, if only one such Yield shall
be published during the relevant Calendar Period as provided below), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately prior to the last ten calendar days of March, June, September or
December, as the case may be, prior to the Quarterly Dividend Period for which
the dividend rate on the Series A Preferred Stock is being determined. In the
event that the Federal Reserve Board does not publish such a weekly per annum
Twenty Year Average Yield during such Calendar Period, then the Twenty Year
Constant Maturity Rate for such Dividend Period shall be the arithmetic average
of the two most recent weekly per annum Twenty Year Average Yields (or the one
weekly per annum Twenty Year Average Yield, if only one such Yield shall be
published during the relevant Calendar Period as provided below), as published
weekly during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the event that a
per annum Twenty Year Average Yield shall not be published by the Federal
Reserve Board or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the Twenty Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic average of the
two most recent weekly per annum average yields to maturity (or the one weekly
average yield to maturity, if only one such yield shall be published during the
relevant Calendar Period as provided below) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other than Special
Securities) then having maturities of not less than eighteen nor more than
twenty-two years, as finally published during such Calendar Period by the
Federal Reserve Board or, if the Federal Reserve Board shall not publish such
yields, by any Federal Reserve Bank or by any U.S. Government department or
agency selected by the Corporation. In the event that the Corporation determines
in good faith that for any reason the Corporation cannot determine the Twenty
Year Constant Maturity Rate for any Quarterly Dividend Period as provided above
in this paragraph, then the Twenty Year Constant Maturity Rate for such Dividend
Period shall be the arithmetic average of the per annum average yields to
maturity based upon the closing bids during such Calendar Period for each of the
issues of actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) with a final maturity date not less
than eighteen nor more than twenty-two years from the date of each such
quotation, as quoted daily for each business day in New York City (or less
frequently if daily quotations shall not be generally available) to the
Corporation by at least three recognized U.S. Government securities dealers
selected by the Corporation.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Twenty
Year Constant Maturity Rate shall each be rounded to the nearest five hundredths
of a percentage point.
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The Applicable Rate with respect to each Quarterly Dividend Period shall be
calculated as promptly as practicable by the Corporation according to the
appropriate method described herein. The Corporation shall cause notice of each
Applicable Rate to be enclosed with the dividend payment checks next mailed to
the holders of the Series A Preferred Stock.
For purposes of this paragraph, the term
(A) "Calendar Period" shall mean 14 calendar days;
(B) "Special Securities" shall mean securities which can, at the option of
the holder, be surrendered at face value in payment of any Federal estate tax or
which provide tax benefits to the holder and are priced to reflect such tax
benefits or which were originally issued at a deep or substantial discount;
(C) "Ten Year Average Yield" shall mean the average yield to maturity for
actively traded marketable U.S. Treasury fixed interest rate securities
(adjusted to constant maturities of ten years); and
(D) "Twenty Year Average Yield" shall mean the average yield to maturity
for actively traded marketable U.S. Treasury fixed interest rate securities
(adjusted to constant maturities of twenty years).
(iii) Redemption. The Series A Preferred Stock shall not be redeemable
prior to March 1, 1986. On or after March 1, 1986, the Corporation, at its
option, may redeem the Series A Preferred Stock, as a whole or in part, at any
time or from time to time, at a redemption price (A) in the case of any
redemption on a redemption date from March 1, 1986 to February 29, 1988,
inclusive of $103.00 per share, and (B) in the case of any redemption on a
redemption date occurring on or after March 1, 1988, of $100.00 per share, plus
, in each case, accrued and unpaid dividends thereto to the date fixed for
redemption.
In the event the Corporation shall redeem shares of Series A Preferred
Stock, notice of such redemption shall be given by first class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the redemption
date, to each holder of record of the shares to be redeemed, at such holder's
address as the same appears on the stock register of the Corporation. Each such
notice shall state: (1) the redemption date; (2) the number of shares of Series
A Preferred Stock to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from such
holder; (3) the redemption price; (4) the place or places where certificates for
such shares are to be surrendered for payment of the redemption price; and (5)
that dividends on the shares to be redeemed will cease to accrue on such
redemption date. Notice having been mailed as aforesaid, from and after the
redemption date (unless default shall be made by the Corporation in providing
money for the payment of the redemption price) dividends on the shares of the
Series A Preferred Stock so called for redemption shall cease to accrue, and
said shares shall no longer be deemed to be outstanding, and all rights of the
holders thereof as stockholders of the Corporation (except the right to receive
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<PAGE>
from the Corporation the redemption price) shall cease. Upon surrender in
accordance with said notice of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors of the
Corporation shall so require and the notice shall so state), such shares shall
be redeemed by the Corporation at the redemption price aforesaid. If less than
all the outstanding shares of the Series A Preferred Stock are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
shares of Series A Preferred tock not previously called for redemption by lot or
pro rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable. A new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.
Notwithstanding the foregoing provisions of this subparagraph (iii), if any
dividends on the Series A Preferred Stock are in arrears, no shares of the
Series A Preferred Stock shall be redeemed unless all outstanding shares of the
Series A Preferred Stock are simultaneously redeemed, and the Corporation shall
not purchase or otherwise acquire any shares of such Series; provided, however,
that the foregoing shall not prevent the purchase or acquisition of shares of
the Series A Preferred Stock pursuant to a purchase or exchange offer made on
the same terms to holders of all outstanding shares of the Series A Preferred
Stock.
(iv) Shares to be Retired. All shares of the Series A Preferred Stock
redeemed by the Corporation shall be retired and cancelled and shall be
restored to the status of authorized but unissued shares of preferred
stock, without designation as to series, and may thereafter be issued.
(v) Conversion or Exchange. The holders of shares of the Series A
Preferred Stock shall not have any rights to convert such shares into or
exchange such shares for shares of any other class or classes or of any
other series of any class or classes of capital stock
(vi) Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, the
holders of the Series A Preferred Stock shall be entitled to receive out of the
assets of the Corporation available for distribution to stockholders, before any
distribution of assets shall be made to the holders of Common Stock or of any
other shares of stock of the Corporation ranking as to such a distribution
junior to the Series A Preferred Stock, an amount equal to $100 per share plus
an amount equal to any accrued and unpaid dividends thereon (whether or not
earned or declared) to the date fixed for payment of such distribution. If upon
any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the amounts payable with respect to the Series A Preferred Stock
and any other shares of stock of the Corporation ranking as to any such
distribution on a parity with the Series A Preferred Stock are not paid in full,
the holders of the Series A Preferred Stock and of such other shares shall share
ratably in any such distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are entitled. After
payment to the holders of the Series A Preferred Stock of the full preferential
amounts provided for in this subparagraph (vi) the holders of the Series A
Preferred Stock shall be entitled to no further participation in any
distribution of assets by the Corporation.
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Neither the sale, conveyance, exchange or transfer of all or substantially
all the property or business of the Corporation, the merger or consolidation of
the Corporation into or with any other corporation nor the merger or
consolidation of any other corporation into or with the Corporation shall be
deemed to be a dissolution, liquidation or winding up, voluntary or involuntary,
of the Corporation for the purposes of this subparagraph (vi).
(vii) Limitation on Dividends on Junior Ranking Stock. So long as any
of the Preferred Stock shall be outstanding, the Corporation shall not declare
any dividends on the Common, Stock of the Corporation or any other stock of the
Corporation ranking as to dividends or distribution of assets junior to the
Preferred Stock (as defined below, the "Junior Stock"), or make any payment on
account of, or set apart money for, a sinking or other analogous fund for the
purchase, redemption or other retirement of any shares of Junior Stock, or make
any distribution in respect thereof, whether in cash or property or in
obligations or stock of the Corporation, other than Junior Stock (such
dividends, payments, setting apart and distributions being herein called "Junior
Stock Payments"), unless full cumulative dividends shall have been paid or dealt
and set apart for payment upon all outstanding shares of preferred stock other
than Junior Stock, at the date of such declaration in the case of any such
dividend, or the date of such setting apart in the case of any such fund, or the
date of such payment or distribution in the case of any other Junior Stock
Payment.
(viii) Ranking of Stock of the Corporation. For purposes of this
paragraph, any stock of any class or classes of the Corporation shall be deemed
to rank:
(A) prior to the shares of the Preferred Stock, either as to dividends or
upon liquidation, if the holders of such class or classes shall be entitled to
the receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, as the case may be, in preference
or priority to the holders of shares of the Preferred Stock;
(B) on a parity with shares of the Preferred Stock, either as to dividends
or upon liquidation, whether or not the dividend rates, dividend payment dates
or redemption or liquidation prices per share or sinking fund provisions, if
any, be different from those of the Preferred Stock, if the holders of such
stock shall be entitled to the receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation, as the case may
be, in proportion to their respective dividend rates or liquidation prices,
without preference or priority, one over the other, as between the holders of
such stock and the holders of shares of the Preferred Stock; and
(C) junior to shares of the Preferred Stock, either as to dividends or upon
liquidation, if such holders of class shall be Common Stock or if the shares of
the Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, as
the case may be, in preference or priority to the holders of shares of such
class or classes. "
is amended to read in full as follows:
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"9.(a) The total number of shares of all classes of capital stock which the
Corporation may henceforth have is twelve million five hundred thousand shares,
of which two million five hundred thousand shares shall be shares of Preferred
Stock of the par value of One Hundred Dollars ($100) per share (hereinafter
called "Preferred Stock"), and ten million shares shall be shares of Common
Stock of the par value of Twenty-five Dollars ($25) per share (hereinafter
called "Common Stock").
(b) The Corporation shall have the authority to issue at any time and from
time to time shares of Preferred Stock in one or more series, subject to the
limitation that, if the stated dividends and amounts payable on liquidation are
not paid, in full, the shares of all series of the same class shall share
ratably in the payment of dividends including accumulations, if any, in
accordance with the sums which would be payable on such shares if all dividends
were declared and paid in full, and in any distribution of assets other than by
way of dividends in accordance with the sums which would be payable on such
distribution if all sums payable were discharged in full.
(c) Except as otherwise required by law, the holders of the Preferred Stock
shall have no voting power whatsoever.
(d) Dividends on outstanding Preferred Stock of each series shall be
declared and paid, or set apart for payment, before any dividends shall be
declared and paid, or set apart for payment, on the shares of Common Stock with
respect to the same dividend period.
(e) Upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, the holders of Preferred Stock shall be
entitled to receive out of the assets of the Corporation, before any
distribution shall be made to the holders of the Common Stock, the amounts
determined to be payable on the Preferred Stock of each series in the event of
voluntary or involuntary liquidation. "
5. The foregoing amendments were authorized by written consent of the
holder of all of the outstanding shares of the Corporation entitled to vote
thereon, given pursuant to Section 6015 of the Banking Law.
IN WITNESS WHEREOF, we have signed this Certificate on the Nth day of
October, 1989.
LEWIS T. PRESTON
Chairman of the Board
BARBARA S. STOKES
Secretary
108
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STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
BARBARA S. STOKES, being duly sworn, deposes and says that she is the
Secretary 0f MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that she is one of the
persons who signed the foregoing Certificate; that she has read the foregoing
Certificate and knows the contents thereof; and that the statements therein are
true.
BARBARA S. STOKES
Sworn to before me this
12th day of October, 1989
JAMES C. P. BERRY
Notary Public, State of New York
No. 31-4654607
Qualified in New York County
Commission Expires Sept. 30, 1991
[NOTARIAL SEAL]
I, DONALD J. KAVANAGH, Deputy Superintendent of Banks of the State of New
York, Do HEREBY APPROVE the annexed Certificate entitled "Certificate of
Amendment of the Organization Certificate of MORGAN GUARANTY TRUST COMPANY OF
NEW YORK under Section 8005 of the Banking Law" dated October 12, 1989,
providing for the cancellation and retirement of 2,500,000 shares of Adjustable
Rate Cumulative Preferred Stock9 Series A (par value $100 per share) and the
restoration of such shares to the status of authorized but unissued shares of
preferred stock.
Witness, my hand and official seal of the Banking Department
at the City of New York, this 16th day of October in the
Year of our Lord one thousand nine hundred and eighty-
nine
DONALD J. KAVANAGH
Deputy Superintendent of Banks
[SEAL]
109
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
--------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and
year of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate
relating to the number of directors of the Corporation, which was last amended
as set forth in Paragraph 4 of the "Certificate to Provide that the Number of
Directors of GUARANTY TRUST COMPANY OF NEW YORK be not less than a stated
minimum nor more than a stated maximum pursuant to Section Thirty-Five of the
Stock Corporation Law", filed on January 17, 1934, and which now reads as
follows:
"4. The number of directors hereafter shall be not less than fifteen
nor more than twenty-five. "
is amended to read in full as follows:
" 4. The number of directors of the Corporation shall be not less than
seven nor more than twenty-five.
4. The foregoing amendment was authorized by written consent of the
holder of all of the utstanding shares of the Corporation entitled to vote
thereon, given pursuant to Section 6015 of the Banking Law.
110
<PAGE>
IN WITNESS WHEREOF, we have signed this Certificate on the 11th day of
March, 1993.
DENNIS WEATHERSTONE
Chairman of the Board
BARBARA S. STOKES
Secretary
111
<PAGE>
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
BARBARA S. STOKES, being duly sworn, deposes and says that she is the
Secretary of MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that she is one of the
persons who signed the foregoing Certificate; that she has read the foregoing
Certificate and knows the contents thereof ; and that the statements therein are
true.
BARBARA S. STOKES
Sworn to before me this
11th day of March, 1993
MARION I. PEARSON
Notary Public, State of New York
No. 41-4964033
Qualified in Queens County
Certificate filed in New York County
Commission Expires March 19,1994
[NOTARIAL SEAL]
112
<PAGE>
I, CARMINE M. TENGA, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed certificate entitled " Certificate of
Amendment of the Organization Certificate Of MORGAN GUARANTY TRUST COMPANY OF
NEW YORK under Section 8005 of the Banking Law", dated March 11, 1993, providing
for a change in the number of Directors from the previously authorized number of
not less than 15 nor more than 25, to not less than 7 nor more than 25.
Witness, my hand and official seal of the Banking Department at the City of
New York, this 17th day of March in the Year of our Lord one thousand
nine hundred and ninety-three
CARMINE M. TENGA
Deputy Superintendent of
Banks
[SEAL]
113
<PAGE>
CERTIFICATE OF AMENDMENTOF THE
ORGANIZATION CERTIFICATE
OF
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
UNDER SECTION 8005 OF THE BANKING LAW
---------
We, the undersigned, being the Chairman of the Board and the Secretary,
respectively, of MORGAN GUARANTY TRUST COMPANY OF NEW YORK (hereinafter called
the "Corporation"), hereby certify as follows:
1. The name of the Corporation is Morgan Guaranty Trust Company of New
York. The name under which the Corporation was originally formed was New York
Guaranty and Indemnity Company.
2. The Corporation was created by special act. The chapter number and
year of passage of such act are Chapter 179, Laws of 1864.
3. The provision of the Corporation's Organization Certificate
relating to the amount of the Corporation's capital stock, which was last
amended as set forth in Paragraph 3 of the "Certificate of Amendment of the
Organization Certificate of Morgan Guaranty Trust Company of New York under
Section 8005 of the Banking Law", dated October 12, 1989, and which now reads as
follows:
"8. The amount of the capital stock which the Corporation is hereafter
authorized to have is Five Hundred Million Dollars ($500,000,000) and all
of the shares are to have a par value."
is amended to read in full as follows:
"8. The amount of the capital stock which the Corporation is hereafter
authorized to have is Five Hundred Twenty Five Million Dollars
($525,000,000) and all of the shares are to have a par value."
4. The provision of the Corporation's Organization Certificate
relating to the number of shares into which the Corporation's capital stock is
divided and the par value of such shares, which was last amended as set forth in
Paragraph 4 of the "Certificate of Amendment of the Organization Certificate of
Morgan Guaranty Trust Company of New York under Section 8005 of the Banking
Law", dated October 12, 1989 and which now reads as follows:
114
<PAGE>
"9.(a) The total number of shares of all classes of capital stock
which the Corporation may henceforth have is twelve million five hundred
thousand shares, of which two million five hundred thousand shares shall be
shares of Preferred Stock of the par value of One Hundred Dollars ($100)
per share (hereinafter called "Preferred Stock"), and ten million shares
shall be shares of Common Stock of the par value of Twenty-five Dollars
($25) per share (hereinafter called "Common Stock").
(b) The Corporation shall have the authority to issue at any time and from
time to time shares of Preferred Stock in one or more series, subject to the
limitation that, if the stated dividends and amounts payable on liquidation are
not paid in full, the shares of all series of the same class shall share ratably
in the payment of dividends including accumulations, if any, in accordance with
the sums which would be payable on such shares if all dividends were declared
and paid in full, and in any distribution of assets other than by way of
dividends in accordance with the sums which would be payable on such
distribution if all sums payable were discharged in full.
(c) Except as otherwise required by law, the holders of Preferred Stock
shall have no voting power whatsoever.
(d) Dividends on outstanding Preferred Stock of each series shall be
declared and paid, or set apart for payment, before any dividends shall be
declared and paid, or set apart for payment, on the shares of Common Stock with
respect to the same dividend period.
(e) Upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, the holders of Preferred Stock shall be
entitled to receive out of the assets of the Corporation, before any
distribution shall be made to the holders of the Common Stock, the amounts
determined to be payable on the Preferred Stock of' each series in the event of
voluntary or involuntary liquidation."
is amended to read as follows:
"9.(a) The total number of shares of all classes of capital stock which the
Corporation may henceforth have is thirteen million five hundred thousand
shares, of which two million five hundred thousand shares shall be shares of
Preferred Stock of the par value of One Hundred Dollars ($100) per share
(hereinafter called "Preferred Stock"), and eleven million shares shall be
shares of Common Stock of the par value of Twenty-five Dollars ($25) per share
(hereinafter called "Common Stock").
(b) The Corporation shall have the authority to issue at any time and from
time to time shares of Preferred Stock in one or more series, subject to the
limitation that, if the stated dividends and amounts payable on liquidation are
not paid in full, the shares of all series of the same class shall share ratably
in the payment of dividends including accumulations, if any, in accordance with
the sums which would be payable on such shares if all dividends were declared
and paid in full, and in any distribution of assets other than by way of
dividends in accordance with the sums which would be payable on such
distribution if all sums payable were discharged in full.
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<PAGE>
(c) Except as otherwise required by law, the holders of Preferred Stock
shall have no voting power whatsoever.
(d) Dividends on outstanding Preferred Stock of each series shall be
declared and paid, or set apart for payment, before any dividends shall be
declared and paid, or set apart for payment, on the shares of Common Stock with
respect to the same dividend period.
(e) Upon any dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, the holders of Preferred Stock shall be
entitled to receive out of the assets of the Corporation, before any
distribution shall be made to the holders of the Common Stock, the amounts
determined to be payable on the Preferred Stock of each series in the event of
voluntary or involuntary liquidation."
5. The foregoing amendments were authorized by written consent of the
holder of all of the outstanding shares of the Corporation entitled to vote
thereon, given pursuant to Section 6015 of the Banking Law.
IN WITNESS WHEREOF, we have signed this Certificate on the 13th day of
March, 1996.
DOUGLAS A. WARNER III
Chairman of the Board
MARGARET M. FORAN
Secretary
116
<PAGE>
STATE OF NEW YORK }ss.:
COUNTY OF NEW YORK
MARGARET M. FORAN, being duly sworn, deposes and says that she is the
Secretary Of MORGAN GUARANTY TRUST COMPANY OF NEW YORK; that she is one of the
persons who signed the foregoing Certificate; that she has read the foregoing
Certificate and knows the contents thereof; and that the statements therein are
true.
MARGARET M. FORAN
Sworn to before me this
13th day of March, 1996
MARIA I. FABRIZZI
Notary Public, State of New York
No. 31-4906640
Qualified in New York County
Commission Expires October 5, 1997
[NOTARIAL SEAL]
117
<PAGE>
I, PETER M. PHILBIN, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate entitled "Certificate of
Amendment of the Organization Certificate of MORGAN GUARANTY TRUST COMPANY OF
NEW YORK under Section 8005 of the Banking Law," dated March 13, 1996, providing
for an increase in authorized capital stock from $500,000,000 consisting of
2,500,000 shares with a par value of $100 each designated as Preferred Stock and
10,000,000 shares with a par value of $25 each designated as Common Stock to
$525,000,000 consisting of 2,500,000 shares with a par value of $100 each
designated as Preferred Stock and 11,000,000 shares with a par value of $25 each
designated as Common Stock.
Witness, my hand and official seal of the Banking Department at the City of
New York, this 21st day of March in the Year of our Lord one thousand nine
hundred and ninety-six
PETER M. PHILBIN
Deputy Superintendent of Banks.
[SEAL]
<PAGE>
Exhibit 2
See Exhibit 1
<PAGE>
Exhibit 3
AUTHORIZATION TO EXERCISE TRUST POWERS
Morgan Guaranty Trust Company of New York is hereby authorized and empowered
to accept and execute any trust created by mortgage made by any rail road or
other corporation, to secure its bonds or other obligations lawfully made or
issued, and appointing such company trustee and to act as trustee in respect to
all matters embraced in such trust.
Morgan Guaranty Trust
By:/s/Bianca A. Russo
-----------------------
Bianca Russo
Vice President
<PAGE>
Exhibit 4
By-Laws of Morgan Guaranty Trust Company of New York
As amended through April 10, 1996
<PAGE>
The undersigned, Assistant Secretary of Morgan Guaranty Trust Company of New
York, hereby certifies that attached hereto is a true and complete copy of the
By-Laws of the Company as amended to date.
- --------------------------- ------------------------------------
Date Assistant Secretary
2
<PAGE>
By-Laws of Morgan Guaranty Trust Company of New York
Article I
Stockholders
Section 1.1. The annual meeting of the stockholders of the Company shall be
held, within the first four months of each calendar year, on such date and at
such time and place within or without the State of New York as may be fixed by
the Board of Directors, for the election of Directors and such other business as
may properly come before the meeting. Notice of the time, place and purpose or
purposes of such meeting shall be given not less than 10 nor more than 50 days
before said meeting by mailing, postage prepaid, such notice, signed by the
Chairman of the Board or the President or a Managing Director or a Vice
President or the Secretary or an Assistant Secretary, addressed to each
stockholder of record entitled to vote at such meeting at his address as it
appears on the stock book of the Company, unless he shall have filed with the
Secretary a written request that notices intended for him be mailed to some
other address, in which case it shall be mailed to the address designated in
such request. Notice shall not be required to be given to any stockholder who
shall attend such meeting in person or by proxy, or who shall waive such notice
in writing.
Section 1.2. Special meetings of the stockholders may be called by the
Chairman of the Board, a Vice Chairman of the Board, the President or the Board
of Directors. It shall be the duty of the Chairman of the Board or a Vice
Chairman of the Board or the President to call a special meeting of the
stockholders whenever requested in writing to do so by stockholders owning a
majority of the capital stock of the Company. Notice of any special meeting,
stating the time, place and purpose or purposes thereof, shall be given by mail
to the stockholders in the manner provided in Section 1. 1 for the calling of
annual meetings of stockholders.
Section 1.3. At all meetings of stockholders, unless otherwise provided by
law, stockholders owning one-third of the capital stock of the Company, present
either in person or by proxy, shall constitute a quorum, but less than a quorum
shall have power to adjourn any meeting. Except as otherwise provided by law, a
majority of the quorum at a meeting, voting either in person or by proxy, shall
decide any question brought before such meeting.
Section 1.4. The Chairman of the Board, or in his absence a Vice Chairman of
the Board, or in his or their absence the President, shall preside at all
meetings of stockholders, and the order in which the business thereof shall be
disposed of, in the absence of a contrary vote by stockholders owning a majority
of the capital stock of the Company present and voting at the meeting, whether
in person or by proxy, shall be determined by the presiding officer.
Section 1.5. The Board of Directors may at any time appoint two or more
persons to act as inspectors of election at any meeting of stockholders. No
director or officer shall be eligible to act as an inspector. If any inspector
so appointed shall be absent or shall refuse to act, or if his office become
vacant and be not filled by the Board of Directors, if a majority of the
inspectors be present, they may act; otherwise, the presiding officer of the
meeting may appoint
3
<PAGE>
one or more inspectors of election for such meeting. Each inspector shall be
entitled to a reasonable compensation for his services to be paid by the
Company.
Article II
Board of Directors
Section 2.1. The affairs of the Company shall be managed Board of Directors
and its corporate powers exercised by a Board of Directors which shall consist
of not less than 7 nor more than 25 members. The Board shall from time to time
by vote of a majority of Directors then in office fix the number of Directors
within the maximum and minimum limits.
Section 2.2. At each annual meeting of stockholders each of the Directors
shall be elected to serve until the next annual meeting of stockholders and
until his successor shall have been elected and shall have qualified.
Section 2.3. The Board of Directors shall hold regular meetings for
business, of which meetings no notice shall be required, on such date and at
such time and place as may be fixed by the Board of Directors.
Section 2.4. Special meetings of the Board of Directors may be called by
the Chairman of the Board, a Vice Chairman of the Board or the President, and
any of them shall call a special meeting whenever requested to do so by any two
members of the Board of Directors. Notice of such meeting shall be mailed to
each Director addressed to him at his usual residence or place of business at
least two days before the day on which such meeting is to be held, or shall be
sent to him at such address by facsimile, electronic mail, telegram, radio or
cable or given personally or by telephone not later than the day before such
meeting is to be held.
Section 2.5. Any one or more members of the Board of Directors or any
committee thereof may participate in a meeting of the Board of Directors or a
committee thereof by means of conference telephone or similar communications
equipment allowing all persons participating in the meeting to hear each other
at the same time. Participation in a meeting by such means shall constitute
presence in person at such meeting.
Section 2.6. Except as otherwise required by law, one-third of the number
of Directors, as fixed from time to time, shall constitute a quorum.
Section 2.7. Directors and members of the Executive Committee and the
members of any other committee shall be entitled to receive such compensation or
such fees for attendance as the Board of Directors shall fix from time to time.
Nothing herein contained shall be construed to preclude any Director from
serving in any other capacity and receiving compensation therefor.
Section 2.8. Each person who was or is a party or is threatened to be made
a party to, or is involved in any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that such person is or was a director, officer, employee or
agent of the Company or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
4
<PAGE>
venture, trust, employee benefit plan or other enterprise, shall be indemnified
and held harmless by the Company to the fullest extent permitted by applicable
law. The right to indemnification conferred in this Section 2.8 shall also
include the right to be paid by the Company the expenses incurred in connection
with any such proceeding in advance of its final disposition to the fullest
extent authorized by applicable law. The right to indemnification conferred in
this Section 2.8 shall be a contract right.
The Company shall determine the right of any person to receive
indemnification as provided hereunder in accordance with the provisions of
applicable law.
The rights and authority conferred in this Section 2.8 shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of these By-Laws or the Organization Certificate of
the Company, agreement, vote of stockholders or disinterested directors or
otherwise.
Neither the amendment nor repeal of this Section 2.8 nor the adoption of any
provision of these By-Laws or the Organization Certificate of the Company or of
any statute inconsistent with this Section 2.8 shall eliminate or reduce the
effect of this Section 2.8 in respect of any acts or omissions occurring prior
to such amendment, repeal or adoption of an inconsistent provision.
Article III
Committees
Section 3.1. The Board of Directors shall, at its first meeting Committees
held after the adoption of these By-Laws and at its regular meeting in June of
each year, appoint an Executive Committee of such number of Directors, including
the Chairman of the Board, the Vice Chairman, or if there be more than one, the
Vice Chairmen of the Board, the Chairman of the Executive Committee and the
President, as the Board of Directors may determine, which, unless otherwise
instructed, may exercise the powers of the Board of Directors in the intervals
between the meetings of the Board of Directors. The minutes of each meeting of
the Executive Committee shall be submitted to the first regular meeting of the
Board of Directors following the meeting of the Executive Committee. The
Executive Committee may adopt its own rules of procedure and shall hold meetings
upon request of any member thereof. No notice of any meetings of the Executive
Committee shall be required. Three members of the Executive Committee shall
constitute a quorum.
Section 3.2. The Board of Directors may appoint a Directors Advisory
Council to consist of a Chairman and a Vice Chairman and such other persons as
the Board of Directors may select, who shall not be, and shall not be deemed to
be, Directors, officers or employees of the Company and whose functions shall
not include participation in the policy making or operating management of the
Company. The Directors Advisory Council shall meet at such place and at such
times as the Board of Directors may from time to time determine, for which
meetings no notice shall be required, and at such other times as the Chairman or
Vice Chairman of the Directors Advisory Council shall determine on at least 3
days' written notice to each member of such Council. The members of the
Directors Advisory Council shall be entitled to such
5
<PAGE>
compensation as shall be fixed by resolution of the Board of Directors. The
Directors Advisory Council shall consider, advise upon and make recommendations
to the Board of Directors and to the Chairman of the Board with respect to
matters relating to the general conduct of the business of the Company and with
respect to such questions relating thereto as may be submitted to it by the
Board of Directors, the Executive Committee or the Chairman of the Board. The
members of the Directors Advisory Council shall be appointed annually at the
regular meeting of the Board of Directors held in June, but additional members
or members to fill vacancies may be appointed at any regular or special meeting
of the Board of Directors. The Directors Advisory Council shall determine its
own quorum and shall adopt its own rules of procedure. The Directors Advisory
Council may appoint, from among its members, such committees with such of the
responsibilities of the Directors Advisory Council as it shall determine, and
the members of such committees shall be entitled to such compensation as shall
be fixed by resolution of the Board of Directors.
Section 3.3. The Board of Directors may appoint, from among its membership
or otherwise, such other committees with such powers as it shall determine. Such
committees shall determine their own quorum and adopt their own rules of
procedure.
Section 3.4. The Board of Directors may fill any vacancy in any committee,
and may designate from time to time a person to act as a member of any committee
at any meeting or meetings thereof in the place of any member absent therefrom.
Article IV
Officers and Employees
Section 4.1. The Board of Directors shall, at its first Officers and
Employees meeting held after adoption of these By-Laws and at the first meeting
after each annual meeting of stockholders, elect from their number a Chairman of
the Board, one or more Vice Chairmen of the Board, a Chairman of the Executive
Committee and a President, each of whom shall hold office until the next annual
election of officers and until his successor is elected and shall have
qualified. Any vacancy occurring in the office of Chairman of the Board, Vice
Chairman of the Board, Chairman of the Executive Committee or President may be
filled at any regular or special meeting of the Board of Directors.
The Board of Directors may also elect or appoint one or more Managing
Directors and one or more Vice Presidents (any one or more of whom may be
designated Executive Vice Presidents or Senior Vice Presidents), a Treasurer, a
Secretary, a Controller, an Auditor and such other officers as the Board of
Directors may deem appropriate or desirable. The Board of Directors may provide
for the election or appointment of officers who are not members of the Board of
Directors in such manner as the Board of Directors may determine or delegate.
All officers elected or appointed pursuant to this paragraph shall hold office
at the pleasure of the Board of Directors. The compensation of officers shall be
fixed either by the Board of Directors or as the Board of Directors may
determine or delegate.
6
<PAGE>
Section 4.2. All other agents and employees of the Company shall be
appointed, their duties prescribed and their compensation fixed, by the Chairman
of the Board or the President, or any officer authorized to do so by either of
them.
Section 4.3. Any or all of the officers or employees of the Company may be
required to give such bonds as the Board of Directors may determine.
Section 4.4. The Chairman of the Board shall have general supervision of
the policies and operations of the Company on behalf of the Board of Directors
and shall be the chief executive officer of the Company. He shall preside at
meetings of the stockholders and at meetings of the Board of Directors, and, in
the absence of the Chairman of the Executive Committee, at meetings of the
Executive Committee. He shall have the power to sign checks, orders, contracts,
leases, notes, drafts and other documents and instruments in connection with the
business of the Company, and together with the Secretary or an Assistant
Secretary conveyances of real estate and other documents and instruments to
which the seal of the Company is affixed.
Section 4.5. The President of the Company shall participate in the
supervision of the policies of the Company on behalf of the Board of Directors
and shall manage and administer the Company's operations. He shall perform all
duties incident to the office of President, and, except as the Board of
Directors or Executive Committee shall otherwise direct, in the event of the
absence or disability of the Chairman of the Board shall act in his place and
assume his duties. He shall have the same power to sign for the Company as is
prescribed in these By-Laws for the Chairman of the Board. In the absence of the
President, such officer as the Board of Directors or the Executive Committee or
the Chairman of the Board may designate shall act in his stead.
Section 4.6. The Vice Chairman of the Board, or if there be more than one,
then each of them, shall participate in the supervision of the policies and
operations of the Company on behalf of the Board of Directors, and shall have
such duties as shall be assigned to them by the Board of Directors, the
Executive Committee and the Chairman of the Board. Each Vice Chairman shall have
the same power to sign for the Company as is prescribed in these By-Laws for the
Chairman of the Board.
Section 4.7. The Chairman of the Executive Committee shall preside at
meetings of the Executive Committee and shall participate in the supervision of
the policies and operations of the Company on behalf of the Board of Directors
and shall have such other duties as shall be assigned to him by the Board of
Directors, the Executive Committee and the Chairman of the Board. He shall have
the same power to sign for the Company as is prescribed in these By-Laws for the
Chairman of Board.
Section 4.8. Each Managing Director and each Vice President shall have the
duties and authority usually pertaining to such office and in addition such
other duties as shall be assigned to him by the Board of Directors, the
Executive Committee, the Chairman of the Board, a Vice Chairman of the Board and
the President. Unless otherwise ordered by the Board of Directors or
7
<PAGE>
the Executive Committee, each Managing Director and each Vice President shall
have the same power to sign for the Company as is prescribed in these By-Laws
for the Chairman of the Board.
Section 4.9. The Treasurer shall have the supervision and care of all the
funds and securities of the Company. He shall keep permanent records of the
evidences of property or indebtedness and of all fiscal transactions of the
Company. He shall perform all acts incident to the office of Treasurer.
Section 4.10. The Secretary shall keep the minutes of all meetings of the
Board of Directors and of all meetings of the stockholders; he shall attend to
the giving and receiving of all notices of and to the Company; he may sign, with
other authorized officers, all contracts, instruments or documents in the name
of the Company and may affix or cause to be affixed thereto the seal of the
Company, of which he shall be the custodian; and he shall in general perform all
the duties incident to the office of Secretary.
Section 4.11. The Controller shall exercise general supervision over, and
be responsible for, the operation of all matters pertaining to the accounting
and bookkeeping of the Company and shall have such further duties as the
Chairman of the Board or the President shall assign to him. He shall render to
the Board of Directors, the Executive Committee, the Chairman of the Board, the
Vice Chairmen of the Board and the President condensed monthly statements of the
condition of the Company and of its operating results and shall prepare such
cost control reports and such other statements and reports as the Chairman of
the Board, a Vice Chairman of the Board or the President may request.
Section 4.12. The Auditor shall exercise general supervision over, and be
responsible for, the operation of all matters pertaining to the auditing of the
Company and shall have such further duties as the Chairman of the Board or the
President shall assign to him. He shall render to the Board of Directors, the
Executive Committee, any committee of the Board of Directors appointed to
examine the affairs of the Company, the Chairman of the Board, the Vice Chairmen
of the Board and the President such regular audit statements and reports as may
be requested of him and such other reports as in his judgment are necessary in
the performance of the duties incident to the office of Auditor.
Section 4.13. Any Assistant Treasurer shall perform such duties as may be
designated by the President with the approval of the Board of Directors, the
Executive Committee, the Chairman of the Board or a Vice Chairman of the Board.
In the absence or inability of the Treasurer to act, any Assistant Treasurer may
perform all the duties and may exercise all the powers of the Treasurer.
Section 4.14. Any Assistant Secretary shall perform such duties as may be
designated by the President with the approval of the Board of Directors, the
Executive Committee, the Chairman of the Board or a Vice Chairman of the Board.
In the absence or inability of the Secretary to act, any Assistant Secretary may
perform all the duties and may exercise any of the powers of the Secretary.
8
<PAGE>
Section 4.15. All other officers of the Company shall perform such duties
as may be designated by the Chairman of the Board or any officer authorized to
do so by him.
Section 4.16. All instruments executed by the Company as trustee, executor,
administrator, registrar, transfer agent, depositary, agent or in any other
fiduciary capacity, including agreements, indentures, mortgages, deeds,
conveyances, satisfactions, releases, assignments, transfers, participation
certificates, powers of attorney, proxies, petitions, proofs of claim and all
other documents and writings in connection with any fiduciary capacity, may be
executed by the Chairman of the Board, a Vice Chairman of the Board, the
President, any Managing Director, any Vice President, the Secretary, the
Treasurer, any Assistant Vice President, any Associate or any other person
thereunto authorized by the Board of Directors or the Executive Committee. Any
officer or person authorized to execute any such instrument is also authorized
to affix the seal of the Company thereto and to cause the same to be attested by
the Secretary or an Assistant Secretary or a Vice President or an Associate.
All authentications or certifications of the Company as trustee under any
mortgage, deed of trust, indenture or agreement securing or providing for bonds,
debentures or notes, and all certificates as registrar or transfer agent, and
all checks as disbursing agent, and all certificates of deposit, interim
certificates and trust receipts or certificates, may be executed either by any
officer or person hereinabove mentioned or referred to in the first paragraph of
this Section or by an Assistant Secretary or an Assistant Treasurer.
The foregoing provisions of this Section 4.16 are in addition to and not in
substitution for the manner of execution of any instrument elsewhere provided in
these By-Laws.
Section 4.17. All checks, orders, contracts, advices and other instruments
and documents shall be signed by the officers authorized in these By-Laws to do
so or by such other officers or by such employees and agents other than officers
as the Board of Directors or the Executive Committee shall authorize, and
subject to such restrictions as the Board of Directors or Executive Committee
shall prescribe. The Board of Directors or Executive Committee may delegate to
one or more officers of the Company all or part of the authority to grant
signing powers contained in this Section 4.17.
Article V
Seal
Section 5.1. The Company shall have a seal which shall be Seal in such form
as the Board of Directors shall approve.
Article VI
Capital Stock
Section 6.1. All certificates of stock shall be signed by the Capital Stock
President, a Group Executive, a Managing Director, or a Vice President, and the
Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary,
and shall bear the corporate seal. The signatures and the seal may be facsimile,
engraved or printed, to the extent permitted by law.
9
<PAGE>
Section 6.2. No transfer of stock of the Company shall be permitted except
upon the surrender of the outstanding certificate of stock. No new certificate
shall be issued until the former certificate is canceled, except that in the
case of loss or destruction of a certificate, a new certificate may be issued
upon such terms as the Board of Directors may prescribe. Section 6.3 The stock
transfer books may be closed for such period and under such conditions as the
Board of Directors may at any time determine; or in lieu thereof the Board of
Directors may at any time fix a day as the day as of which stockholders entitled
to notice of and to vote at any meeting shall be determined, and only
stockholders of record at the close of business on such day shall be entitled to
notice of or to vote at such meeting.
Article VII
Amendments
Section 7.1. Except as may be otherwise provided by law, these By-Laws may
be altered or repealed at any meeting of the Board of Directors, whether or not
such alteration or repeal shall or may affect any By-Law which does or may be
deemed to limit the powers of the Directors, provided notice of such meeting
setting forth the substance of the proposed alteration or repeal shall have been
given to each Director prior to such meeting.
10
<PAGE>
Exhibit 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
May 26, 1998
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of the Note Trust Deed among Westpac
Securities Administration Limited as Issuer Trustee, Westpac Securitisation
Management Pty Limited as Trust Manager and Morgan Guaranty Trust Company of New
York, the undersigned, in accordance with Section 321(b) of the Trust Indenture
Act of 1939, as amended, hereby consents that the reports of examinations of the
undersigned, made by Federal or State authorities authorized to make such
examinations, may be furnished by such authorities to the Securities and
Exchange Commission upon its request therefor.
Very truly yours,
Morgan Guaranty Trust
Company of New York
By: /s/Marne Lidster
----------------------
Marne Lidster
Vice President
<PAGE>
Exhibit 7
J.P. Morgan & Co. Incorporated
Consolidated statement of condition
Morgan Guaranty Trust Company of New York
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
In millions, except share data March 31 December 31
1998 1997
----------- -------------
<S> <C> <C>
Assets
Cash and due from banks $ 1,077 $ 1,663
Interest-earning deposits with banks 1,488 2,195
Debt investment securities available-for-sale carried at fair value 13,618 20,539
Trading account assets, net of allowance for credit losses of $350 94,798 88,995
Securities purchased under agreements to resell 22,175 28,045
Securities borrowed 10,662 13,831
Loans, net of allowance for credit losses of $450 at March 1998
and $545 at December 1997 33,103 30,851
Accrued interest and accounts receivable 6,124 4,534
Premises and equipment, net of accumulated depreciation of $1,193
at March 1998 and $1,208 at December 1997 1,668 1,669
Other assets 4,789 4,096
- ----------------------------------------------------------------------------------------------------------------------
Total assets 189,502 196,418
- ----------------------------------------------------------------------------------------------------------------------
Liabilities
Noninterest-bearing deposits:
In offices in the U.S. 1,032 1,492
In offices outside the U.S. 1,014 752
Interest-bearing deposits:
In offices in the U.S. 6,971 10,156
In offices outside the U.S. 52,922 48,343
- ----------------------------------------------------------------------------------------------------------------------
Total deposits 61,939 60,743
Trading account liabilities 63,179 61,562
Securities sold under agreements to repurchase and federal
funds purchased 21,944 26,017
Other liabilities for borrowed money 8,304 10,433
Accounts payable and accrued expenses 5,837 7,160
Long-term debt not qualifying as risk-based capital 12,789 14,320
Other liabilities, including allowance for credit losses of $185 1,951 2,713
- ----------------------------------------------------------------------------------------------------------------------
175,943 182,948
Long-term debt qualifying as risk-based capital 2,897 3,037
- ----------------------------------------------------------------------------------------------------------------------
Total liabilities 178,840 185,985
Stockholder's equity
Preferred stock, $100 par value (authorized shares: 2,500,000) -- --
Common stock, $25 par value (authorized shares: 11,000,000;
issued and outstanding: 10,599,027 265 265
Surplus 3,305 3,155
Undivided profits 7,056 6,927
Accumulated other comprehensive income:
Net unrealized gains on investment securities, net of taxes 65 108
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
In millions, except share data March 31 December 31
1998 1997
----------- -------------
<S> <C> <C>
Foreign currency translation, net of taxes (29) (22)
- ----------------------------------------------------------------------------------------------------------------------
Total stockholder's equity 10,662 10,433
- ----------------------------------------------------------------------------------------------------------------------
Total liabilities and stockholder's equity 189,502 196,418
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
Member of the Federal Reserve System and the Federal Deposit Insurance
Corporation.
<PAGE>
Exhibit 99.1
[LETTERHEAD OF ALLEN ALLEN & HEMSLEY]
26 May 1998
Westpac Securitisation Management Pty Limited
Level 5
60 Martin Place
SYDNEY NSW 2000
Dear Sirs
WESTPAC SECURITISATION TRUST
SERIES 1998-1G WST TRUST
We have acted for Westpac Securitisation Management Pty Limited (WSM) in
connection with the Series 1998-1G WST Trust (the TRUST) constituted under the
Master Trust Deed dated 14 February 1997 between Westpac Securities
Administration Limited and The Mortgage Company Pty Limited, to which WSM has
acceded as trust manager with respect to the Trust.
Definitions in the Prospectus as filed with the Securities and Exchange
Commission under the US Securities Act of 1933 (the PROSPECTUS) apply in this
opinion. RELEVANT JURISDICTION means the Commonwealth of Australia or New
South Wales. No assumption or qualification in this opinion limits any other
assumption or qualification in it.
1. DOCUMENTS
We have examined a copy of the Prospectus.
2. ASSUMPTION
For the purposes of giving this opinion we have assumed that where a document
has been submitted to us in draft form it will be executed in the form of that
draft.
3. QUALIFICATIONS
Our opinion is subject to the qualification that we express no opinion as to any
laws other than the laws of each Relevant Jurisdiction as in force at the date
of this opinion and, in particular we express no opinion as to the laws of
England to the United States.
4. OPINION
Based on the assumptions and subject to the qualifications set out above (which,
except where expressly stated, apply equally to each of the opinions below) we
are of the following opinion.
<PAGE>
ALLEN ALLEN & HEMSLEY Page 2
- --------------------------------------------------------------------------------
(a) Any final and conclusive judgment of a court of the State of New York, USA,
or the United States Federal Court having jurisdiction recognised by a the
Relevant Jurisdiction, in respect of an obligation under an Offered Note,
which is for a fixed sum of money, would be enforceable by action in the
courts of each Relevant Jurisdiction without a re-examination of the merits
of the issues determined by the proceedings in the New York court unless:
(i) the proceedings in the New York State court or the United States
Federal Court, as applicable, involved a denial of the principles
or natural justice;
(ii) the judgment is contrary to the public policy of the Relevant
Jurisdiction;
(iii) the judgment was obtained by fraud or duress or was based on a
clear mistake of fact;
(iv) the judgment is a penal or revenue judgment; or
(v) there has been a prior judgment in another court between the same
parties concerning the same issues as are dealt with in the
judgment or the New York State Court or the United States Federal
Court (as applicable).
In particular, actions in a Relevant Jurisdiction (including as original
actions or as actions to enforce judgments of a United States court)
relating to civil liabilities predicated on Federal securities laws of the
United States may not be enforceable in a Relevant Jurisdiction.
(b) A judgment by a court in a Relevant Jurisdiction may be given in some cases
only in Australian dollars.
We consent to the filing of this letter as an exhibit to the Registration
Statement on Form S-11 filed with the Prospectus, without admitting that we
are "experts" within the meaning of the Securities Act of 1933 of the rules
and regulations of the Commission issued under that Act with respect of any
part of the Registration Statement, including this exhibit.
Yours faithfully
/s/ Allen Allen & Hemsley
ALLEN ALLEN & HEMSLEY
