EX-10 20 ex10-2_1.txt Exhibit 10.2.1 Draft: 4 September 2003 Class A2 Confirmation Confirmation to the 1992 ISDA Master(R) Agreement relating to the Class A2 Swap Agreement Dated [ ] September 2003 GRACECHURCH CARD FUNDING (NO. 5) PLC Re: Transaction between Barclays Bank PLC ("Party A") and Gracechurch Card Funding (No. 5) PLC ("Party B") Dear Sirs: The purpose of this letter agreement is to confirm the terms and conditions of the Swap Transaction entered into between you and us on the Trade Date specified below (the "Swap Transaction"). References herein to a Transaction shall be deemed to be references to a Swap Transaction for the purposes of the Definitions. The definitions and provisions contained in the 2000 ISDA Definitions (as published by the International Swaps and Derivatives Association, Inc.) are incorporated into this Confirmation. In the event of any inconsistency between those Definitions and this Confirmation, this Confirmation will govern. 1. This Confirmation incorporates the ISDA Master Agreement, including the schedule thereto (the "ISDA Master") dated as of [ ] September 2003, between you and us and this Confirmation, together with the ISDA Master, constitutes a single agreement (the "Agreement"). All provisions contained in the ISDA Master apply to this Confirmation except as expressly modified below. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Party A: Barclays Bank PLC Party B: Gracechurch Card Funding (No. 5) PLC Trade Date: [ ] September 2003 Effective Date: [ ] September 2003; provided, however, that effectiveness is subject to the issuance of the Notes and the receipt by the Series 03-3 Issuer on or prior to [ ] September 2003 of unconditional confirmation that upon issue the Class A2 Notes will be rated Aaa by Moody's and AAA by Standard & Poor's. Termination Date: 15 August 2006, subject to adjustment in accordance with the Following Business Day Convention, and subject to adjustment in accordance with Section 3.4 below Business Days for USD: A day other than a Saturday, a Sunday or a day on which banking institutions in London, England or New York, New York are authorised or obliged by law to be closed Business Days for GBP: Any day other than a Saturday, a Sunday or a day on which banking institutions in London, England or New York, New York are authorised or obliged by law to be closed Calculation Agent Party A Initial Exchange Amounts and Final Exchange Amounts Party A Initial Exchange Amount: GBP [ ] Party A Initial Exchange Date: Effective Date Party A Final Exchange Amount: Party A Currency Amount on the Termination Date Party A Final Exchange Date: Termination Date Party B Initial Exchange Amount: USD [ ] plus Party B Swap Fee Party B Swap Fee: [ ] Party B Initial Exchange Date: Effective Date Party B Final Exchange Amount: Party B Currency Amount on the Termination Date Party B Final Exchange Date: Termination Date Party A Fixed Rate Amounts Party A Fixed Rate Payer: Party A Party A Currency Amount: USD [ ] (subject to adjustment during the Redemption Period as set out herein) Party A Fixed Rate Payer Period End Dates: The 15th day of each calendar month from and including 15th November 2003 to and including the Termination Date, in each case subject to adjustment in accordance with the Following Business Day Convention -2- Party A Fixed Rate Payer Payment Dates: Each Party A Fixed Rate Payer Period End Date. Party A will provide a clearing system notice as to the amount to be paid on each Party A Fixed Rate Payer Payment Date 2 Business Days prior to each such Party A Fixed Rate Payer Payment Date Party A Fixed Rate Option: [ ] per cent. Calculation Periods for Party A Floating Rate Amounts: Each period from, and including, the Party A Fixed Rate Payer Period End Date to, but excluding, the next following Party A Fixed Rate Payer Period End Date Designated Maturity: 1 month, provided that in respect of the first Calculation Period, it shall be for the period from (and including) [ ] September 2003 to (but excluding) 15th November 2003 Spread: [ ]% Party A Fixed Rate Day Count Fraction: 30/360 as calculated in accordance with Condition 5 of the Conditions for the Notes Party B Floating Rate Amounts Party B Floating Rate Payer: Party B Party B Currency Amount: GBP [ ] (subject to adjustment during the Redemption Period as set out below) Party B Floating Rate Payer Period End Dates: The 15th day of each November, February, May and August to and including the -3- Termination Date, in each case subject to adjustment in accordance with: (a) the Following Business Day Convention, and (b) the Redemption Period as set out below (following which the Party B Floating Rate Payer Period End Date shall be the Amended Party B Floating Rate Payer Period End Date) Party B Floating Rate Payer Payment Dates: 15th November 2003 and thereafter the 15th day of each calendar month to and including the Termination Date, in each case subject to adjustment in accordance with the Following Business Day Convention Party B Floating Rate Option: GBP-LIBOR-BBA calculated in accordance with the Series 03-3 Class A2 Debt Amount, and utilising the Moneyline Telerate Page specified therein, provided that in respect of the first Calculation Period the Party B Floating Rate Option shall be a linear interpolation of the GBP-LIBOR-BBA rates for the first Calculation Period and calculated in accordance with the Series 03-3 Class A2 Debt Amount Calculation Periods for Party B Floating Rate Amounts: Each period from, and including, one Party B Floating Rate Payer Period End Date to, but excluding, the next following Party B Floating Rate Payer Period End Date, provided that the first such Calculation Period for Party B Floating Rate Amounts shall be from, and including, the Effective Date to, but excluding, 15th November 2003, (b) the last such Calculation Period for Party B Floating Rate Amounts shall end on, but exclude, the Termination Date Designated Maturity: In respect of (a) the first Calculation Period, the period from (and including) the Effective Date to (but excluding) 15th November 2003; and (b) Calculation Periods thereafter, 3 months (subject to adjustment during the Redemption Period as set out below) Spread: [ ]% Party B Floating Rate Day Count Fraction: A fraction, the numerator of which is the actual number of days in such Calculation Period and the denominator of which is 365 (or 366 in the case of any Calculation Period ending in a leap year) as calculated in accordance with the interest rate applicable to the Series 03-3 Class A2 Debt Amount Reset Dates: First day of each Calculation Period -4- 3. Details of Variation to Agreement: 3.1 Taxation: Neither Party A nor Party B is under any obligation to gross up any payments to be made under this Agreement for amounts withheld with respect to any Tax. In the event that a Tax is imposed such that Party B's payment hereunder shall be net of the amount of any Taxes so withheld, accounted for, deducted or suffered, then Party A's payment obligation shall be reduced in proportion to the amount by which the payments to be made by Party B are so reduced. In the event that a Tax is imposed such that Party A's payment hereunder shall be net of the amount of any Taxes so withheld, accounted for, deducted or suffered, then (subject to the first sentence of this Section 3.1 and Section 3.2, 3.3 and 3.4 below) the payment obligations of Party B shall remain the same. 3.2 Interest Deferral: (A2) The obligation of Party B to pay the Party B Floating Rate Amount on any Party B Floating Rate Payer Payment Date will be reduced to the extent that, on such Party B Floating Rate Payer Payment Date, the amount of MTN Issuer Available Funds (Series 03-3 Class A2), and hence the amount of Party B Available Funds (Series 03-3 Class A2), is less than the Party B Floating Rate Amount calculated for such Party B Floating Rate Payer Payment Date (the amount of any such reduction, the "Deferred Interest Amount" for that Party B Floating Rate Payer Payment Date). "MTN Issuer Available Funds (Series 03-3 Class A2)" means, in relation to any Party B Floating Rate Payer Payment Date, the aggregate amount of Finance Charge Collections and Acquired Interchange that is distributed by the Receivables Trustee to Barclaycard Funding plc (the "MTN Issuer") by the Receivables Trustee (and deposited in the Series 03-3 Distribution Account) on the related Distribution Date in respect of the Class A2 Monthly Finance Amount (provided that, for the avoidance of doubt, MTN Issuer Available Funds (Series 03-3 Class A2) excludes any amounts distributed by the Receivables Trustee to the MTN Issuer in respect of Excess Finance Charge Amounts). "Party B Available Funds (Series 03-3 Class A2)" means, in relation to any Party B Floating Rate Payer Payment Date, the amount that is available to Party B for payment of the Party B Floating Rate Payer Payment Amount calculated for that Party B Floating Rate Payer Payment Date in accordance with the priority of payments set forth in the Trust Deed (provided that, for the avoidance of doubt, Party B Available Funds (Series 03-3 Class A2) shall exclude any amounts received by Party B in respect of Further Interest on the Series 03-3 MTN Certificate). The obligation of Party A to pay the Party A Fixed Rate Amount on any Party A Fixed Rate Payer Payment Date will be reduced by an amount equal to the Party A Fixed Rate Amount otherwise payable on such Party A Fixed Rate Payer Payment Date (prior to any adjustment thereof in accordance with this Section 3.2) multiplied by the Reduction Ratio. The "Reduction Ratio" is a fraction equal to: Deferred Interest Amount ------------------------------------- Aggregate Party B Payment Amount The "Aggregate Party B Payment Amount" is equal to the Party B Floating Rate Amount, before any adjustment thereof in accordance with the terms of the provisions -5- of this Section 3.2, that would otherwise have been payable on such Party B Floating Rate Payer Payment Date. (B) In the event that, on any Party B Floating Rate Payer Payment Date, there are any MTN Issuer Make-up Funds (Series 03-3 Class A2) and hence any Party B Make-up Funds (Series 03-3 Class A2) (any such amount for the relevant Party B Floating Rate Payer Payment Date, an "Additional Party B Amount"), the obligation of Party B to pay the Party B Floating Rate Amount on any Party B Floating Rate Payer Payment Date shall be increased by the Additional Party B Amount. Accordingly, on such Party B Floating Rate Payer Payment Date, Party B shall pay the Party B Floating Rate Amount that would otherwise have been calculated for that Party B Floating Rate Payer Payment Date as well as any Additional Party B Amount. "MTN Issuer Make-up Funds (Series 03-3 Class A2)" means, in relation to any Party B Floating Rate Payer Payment Date, the aggregate amount of Finance Charge Collections and Acquired Interchange that is distributed by the Receivables Trustee to the MTN Issuer on the related Distribution Date by deposit to the Series 03-3 Distribution Account in respect of either of the following: (a) the Class A2 Deficiency Amount (if and to the extent that the same is attributable to the Class A2 Monthly Finance Amount for any earlier Distribution Date); and (b) the Class A2 Additional Finance Amount (if and to the extent that the same is attributable to the Class A2 Deficiency Amount for any earlier Distribution Date), provided that, for the avoidance of doubt, the MTN Issuer Make-up Funds (Series 03-3 Class A2) shall exclude any amounts distributed by the Receivables Trustee to the MTN Issuer in respect of Excess Finance Charge Amounts. "Party B Make-up Funds (Series 03-3 Class A2)" means, in relation to any Party B Floating Rate Payer Payment Date, the amount that is available to Party B for payment of the Additional Party B Amount in accordance with the priority of payments set forth in the Trust Deed, provided that, for the avoidance of doubt, Party B Make-up Funds (Series 03-3 Class A2) shall exclude any amounts received by Party B in respect of Further Interest on the Series 03-3 MTN Certificate. The obligation of Party A to pay the Party A Fixed Rate Amount on any Party A Fixed Rate Payer Payment Date will be increased by an amount (the "Additional Party A Amount") equal to the Party A Fixed Rate Amount otherwise payable on such Party A Fixed Rate Payer Payment Date (prior to any adjustment thereof in accordance with this Section 3.2) multiplied by the Increase Ratio. Accordingly, on such Party A Fixed Rate Payer Payment Date, Party A shall pay the Party A Fixed Rate Amount as well as the Additional Party A Amount. The "Increase Ratio" is a fraction equal to: Additional Party B Amount -------------------------------------- Aggregate Party B Payment Amount 3.3 Redemption Protection Period. In the event that the Regulated Amortisation Period or Rapid Amortisation Period commences prior to the Series 03-3 Scheduled Redemption Date, certain deposit arrangements will apply. In such event, the period from the date of the commencement of the Regulated Amortisation Period or the Rapid Amortisation Period to and including -6- the series 03-3 scheduled redemption date is called the "Redemption Protection Period". During the Redemption Protection Period, on any business day on which an amount (each such amount, a "Class A2 Investor Interest Redemption Amount") is deposited into the Series 03-3 Issuer Account towards redemption of the Series 03-3 MTN Certificate and where such amount is referable to the Class A2 Investor Interest, the amount of such Class A2 Investor Interest Redemption Amount shall be withdrawn by Party B from the Series 03-3 Issuer Account and deposited into an account (the "Class A2 Accumulation Account") in the name of Party B (each such deposit is called an "Interim Class A2 Principal Repayment"). All amounts representing any Interim Class A2 Principal Repayment shall be: (1) maintained in the Class A2 Accumulation Account; (2) held by Party B subject to the security created pursuant to the Deed of Charge; and (3) invested in Swap Permitted Investments (as defined below) as directed by Party A. All income from the Class A2 Accumulation Account is called the "Reinvested Collateral Income". The Reinvested Collateral Income will be released to Party B on each Party B Floating Rate Payer Payment Date. In addition to utilising Party B Available Funds (Series 03-3 Class A2, Party B shall also utilise Reinvested Collateral Income and income from Swap Permitted Investments for the Party B Floating Rate Payer Payment for that Party B Floating Rate Payer Payment Date. Party B's obligation to pay the applicable Party B Floating Rate Payer Payment shall be reduced on each Party B Floating Rate Payer Payment Date by an amount (if any) by which (a) the aggregate amount of the Interim Class A2 Principal Repayment funds then standing to the credit of the Class A2 Accumulation Account on that Party B Floating Rate Payer Payment Date (but not including any Interim Class A Principal Repayment Funds to be deposited on that Party B Floating Rate Payer Payment Date) multiplied by the Party A Fixed Rate Option (and calculated using the applicable Day Count Fraction therefor), exceeds (b) the Reinvested Collateral Income and income from Swap Permitted Investments released to Party B on that Party B Floating Rate Payer Payment Date. Party B's obligation to pay the applicable Party B Floating Rate Payer Payment shall be increased on each Party B Floating Rate Payer Payment Date by an amount (if any) by which: (a) the Reinvested Collateral Income and income from Swap Permitted Investments released to Party B on that Party B Floating Rate Payer Payment Date, exceeds (b) the aggregate amount of the Interim Class A2 Principal Repayment funds then standing to the credit of the Class A2 Accumulation Account on that Party B Floating Rate Payer Payment Date (but not including any Interim Class A Principal Repayment Funds to be deposited on that Party B Floating Rate Payer Payment Date) multiplied by the Party A Fixed Rate Option (and calculated using the applicable Day Count Fraction therefor). "Swap Permitted Investments" means any sterling-denominated bond, debenture, note or other investment or security evidencing debt which (1)(i) has a residual maturity of 364 days or less (and where such maturity date is no later than a date which is on or prior to the Series 03-3 Scheduled Redemption Date), (ii) is purchased at a price no greater than par plus accrued interest, if any, and (iii) (A2) has ratings of "A-1+" from -7- Standard & Poor's, "P-1" from Moody's and, if rated by Fitch Ratings, F1+ from Fitch Ratings, at the time of investment or (B) has different ratings if each of the trustee has been provided with a letter from Standard & Poor's and Moody's to the effect that investment in such securities will not adversely affect the then current rating of the class A1 notes or (2) is a floating rate AAA instrument with a residual maturity of 365 days or greater (and where such maturity date is no later than a date which is on or prior to the Series 03-3 Scheduled Redemption Date) which has received the consent of Standard & Poor's and Moody's, provided that a rating with a "r" suffix or equivalent shall not constitute a Swap Permitted Investment within the above meaning unless otherwise agreed by Standard & Poor's. 3.4 Redemption Period. On the Series 03-3 Scheduled Redemption Date in the event that the Series 03-3 Class A2 Debt Amount is not redeemed in full on such date (such event, a "Redemption Trigger") then the following provisions shall apply. The "Redemption Period End Date" is the earlier of (a) the Party B Floating Rate Payer Payment Date falling in September 2008, and (b) the date upon which the Series 03-3 Class A2 Debt Amount is redeemed in full. From the occurrence of the Redemption Trigger, the Termination Date shall be amended to be the Redemption Period End Date. The period from and including the date on which the Redemption Trigger occurs and the Redemption Period End Date is called the "Redemption Period". During the Redemption Period: (a) the Party B Floating Rate Payer Period End Date shall be amended (each such Party B Floating Rate Payer Period End Date thereafter, an "Amended Party B Floating Rate Payer Period End Date") to be the 15th day of each calendar month, subject to adjustment in accordance with the Following Business Day Convention, provided that if the Redemption Period commences on a day other than a date which would otherwise have been a Party B Floating Rate Payer Period End Date (but for adjustment in accordance with this Section 3.4) then the first Amended Party B Floating Rate Payer Period End Date shall be the Party B Floating Rate Payer Period End Date which would have occurred but for adjustment in accordance with this Section 3.4 and thereafter each Amended Party B Floating Rate Payer Period End Date shall be the 15th day of each calendar month, subject to adjustment in accordance with the Following Business Day Convention; (b) the Designated Maturity for Party B shall change to 1 month commencing on the first Amended Party B Floating Rate Payer Period End Date. 3.5 Amortisation of Party A Currency Amount and Party B Currency Amount during Redemption Period -8- During the Redemption Period, on each Party B Floating Rate Payer Period End Date (including the Series 03-3 Scheduled Redemption Date if the Redemption Trigger falls on the Series 03-3 Scheduled Redemption Date), the Party B Currency Amount shall be reduced (for the next following Calculation Period for Party B) by the amount on deposit on that Party B Floating Rate Payer Period End Date in the Series 03-3 Issuer Account and referable to the Series 03-3 Class A2 Debt Amount and credited to the Class A2 Notes Principal Ledger (the amount of such reduction, the "Party B Amortisation Amount"). On each Party B Floating Rate Payer Payment Date corresponding to such Party B Floating Rate Payer Period End Date, Party B shall pay to Party A an amount equal to the Party B Amortisation Amount. During the Redemption Period, on each Party A Fixed Rate Payer Period End Date (including the Series 03-3 Scheduled Redemption Date if the Redemption Trigger occurs on the Series 03-3 Scheduled Redemption Date), the Party A Currency Amount shall be reduced (for the next following Calculation Period for Party A2) by an amount (the "Party A Amortisation Amount") calculated as specified below. The Party A Amortisation Amount is equal to A x B/C where: A = the Party A Currency Amount calculated on the Effective Date B = the Party B Amortisation Amount applicable on the Party B Floating Rate Payer Period End Date occurring on such Party A Fixed Rate Payer Period End Date C = the Party B Currency Amount calculated on the Effective Date. On each Party A Fixed Rate Payer Payment Date, Party A shall pay to Party B an amount equal to the Party A Amortisation Amount, if any. If the Termination Date occurs at the end of the Redemption Period, to the extent that, on the Termination Date, there are no funds in respect of principal deposited in the Series 03-3 Distribution Account for Class A, and hence no funds (in respect of principal) deposited by the MTN Issuer in the Series 03-3 Issuer Account and referable to the Series 03-3 Class A2 Debt Amount, on and with effect from on the Termination Date each of the Party B Currency Amount and the Party A Currency Amount shall be reduced to zero. 4. Account Details Account for Barclays Bank PLC Payments to Party A SWIFT: BARCGB22 in GBP: Sort code: 20-00-00 Beneficiary: Barclays Swaps Beneficiary Account: 00152021 Account for Barclays Bank PLC NY Payments to Party A SWIFT: BARCUS33 in USD Beneficiary: Barclays Swaps and Options Group NY Beneficiary Account: 050-01922-8 Account for Barclays Bank PLC -9- Payments to Party B Sort code: 20-19-90 in GBP: Account number: [ ] Account for Barclays Bank PLC Payments to Party B Sort code: 20-19-90 in USD: Account number: [ ] 5. Contact for Party A Documentation and Operations: Barclays Bank PLC Attention: Derivatives Director, Legal Division (marked urgent) Telephone: +44 20 7773 2224 Fax No: +44 20 7773 4932 6. Governing Law: England Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Confirmation enclosed for that purpose and returning it to us. BARCLAYS BANK PLC By: Title: Confirmed as of the date first written: GRACECHURCH CARD FUNDING (NO. 5) PLC By: Per pro SFM Directors (No. 2) Limited, as Director Title: Authorised Signatory -10-