RMAC still obligated to redeem mortgage-backed notes on March 12

By Susanna Moon

Chicago, March 7 – Following a recent tender offer by Clifden IOM No.1 Ltd., RMAC 2003-NS4 plc, RMAC 2003-NS3 plc, RMAC 2005-NS4 plc, RMAC 2005-NS3 plc, RMAC 2005-NSP2 plc, RMAC 2005-NS1 plc, RMAC 2004-NS3 plc and RMAC 2004-NSP4 plc notified holders of numerous series of mortgage-backed issues that they remain obligated to redeem the notes on March 12 at par.

Holders were notified by eight separate notices.

In the first batch, issued by RMAC 2003-NS4, the notes covered by the notice are as follows:

• £19 million class A1a mortgage-backed floating-rate notes due June 2020;

• $248 million class A1b mortgage-backed floating-rate notes due June 2020;

• £137 million class A2a mortgage-backed floating-rate notes due March 2036;

• $252 million class A2b mortgage-backed floating-rate notes due March 2036;

• £50 million class A3 mortgage-backed floating-rate notes issued with A3 detachable coupons due March 2036; and

• £2.45 million class C mortgage-backed floating-rate notes due March 2036.

In the second batch, issued by RMAC 2003-NS3, the notes covered by the notice are as follows:

• £90 million class A1a mortgage-backed floating-rate notes due September 2018;

• $146 million class A1b mortgage-backed floating-rate notes due September 2018;

• £132 million class A2a mortgage-backed floating-rate notes due December 2035;

• $288 million class A2b mortgage-backed floating-rate notes due December 2035;

• £55 million class A3 mortgage-backed floating-rate notes issued with A3 Detachable Coupons due December 2035; and

• £2.5 million class C mortgage-backed floating-rate notes due December 2035.

In the third batch, issued by RMAC 2005-NS4, the notes covered by the notice are as follows:

• $206 million class A1 mortgage-backed floating-rate notes due December 2022;

• £80 million class A2 mortgage-backed floating-rate notes due December 2043

• £158.76 million class A3 mortgage-backed floating-rate notes due December 2043;

• £14.8 million class M1 mortgage-backed floating-rate notes due December 2043;

• £12.4 million class M2 mortgage-backed floating-rate notes due December 2043;

• £14.04 million class B1 mortgage-backed floating-rate notes due December 2043;

• Mortgage early repayment certificates due December 2043; and

• Residual certificates due December 2043.

In the fourth batch, issued by RMAC 2005-NS3, the notes covered by the notice are as follows:

• £100 million class A1a mortgage-backed floating-rate notes due June 2024;

• €194 million class A1c mortgage-backed floating-rate notes due June 2024;

• £270 million class A2a mortgage-backed floating-rate notes due June 2043;

• €188 million class A2c mortgage-backed floating-rate notes due June 2043;

• £15 million class M1a mortgage-backed floating-rate notes due June 2043;

• €16.1 million class M1c mortgage-backed floating-rate notes due June 2043;

• £5 million class M2a mortgage-backed floating-rate notes due June 2043;

• €24.8 million class M2c mortgage-backed floating-rate notes due June 2043;

• £7.5 million class B1a mortgage-backed floating-rate notes due June 2043;

• €25.3 million class B1c mortgage-backed floating-rate notes due June 2043;

• Mortgage early repayment certificates due June 2043; and

• Residual certificates due June 2043.

In the fifth batch, issued by RMAC 2005-NSP2, the notes covered by the notice are as follows:

• £75 million class A1a mortgage-backed floating-rate notes due September 2023;

• $34 million class A1b mortgage-backed floating-rate notes due September 2023;

• €69 million class A1c mortgage-backed floating-rate notes due September 2023;

• £220 million class A2a mortgage-backed floating-rate notes due September 2037;

• $44 million class A2b mortgage-backed floating-rate notes due September 2037;

• €290 million class A2c mortgage-backed floating-rate notes due September 2037;

• £22 million class M1a mortgage-backed floating-rate notes due September 2037;

• €48 million class M1c mortgage-backed floating-rate notes due September 2037;

• £26 million class M2a mortgage-backed floating-rate notes due September 2037;

• €37 million class M2c mortgage-backed floating-rate notes due September 2037;

• £10 million class B1a mortgage-backed floating-rate notes due September 2037;

• €22 million class B1c mortgage-backed floating-rate notes due September 2037;

• Mortgage early repayment certificates due September 2037; and

• Residual certificates due September 2037.

In the sixth batch, issued by RMAC 2005-NS1, the notes covered by the notice are as follows:

• $267.7 million class A1 mortgage-backed floating-rate notes due December 2018;

• £175 million class A2a mortgage-backed floating-rate notes due June 2037;

• €526.4 million class A2c mortgage-backed floating-rate notes due June 2037;

• £37.5 million class M1 mortgage-backed floating-rate notes due June 2037;

• £18.8 million class M2 mortgage-backed floating-rate notes due June 2037;

• £11.2 million class B1 mortgage-backed floating-rate notes due June 2037;

• £7.5 million class B2 mortgage-backed floating-rate notes due June 2037;

• Mortgage early repayment certificates due June 2037; and

• Residual certificates due June 2037.

In the seventh batch, issued by RMAC 2004-NS3, the notes covered by the notice are as follows:

• $295 million class A1 mortgage-backed floating-rate notes due March 2025;

• £170 million class A2a mortgage-backed floating-rate notes due December 2036;

• €168 million class A2c mortgage-backed floating-rate notes due December 2036;

• £22.5 million class M1 mortgage-backed floating-rate notes due December 2036;

• £20 million class M2 mortgage-backed floating-rate notes due December 2036;

• £7,5 million class B mortgage-backed floating-rate notes due December 2036; and

• £8.6 million class C mortgage-backed floating-rate notes due December 2036.

In the final batch, issued by RMAC 2004-NSP4, the notes covered by the notice are as follows:

• £121 million class A1 mortgage-backed floating-rate notes due March 2018;

• £595 million class A2 mortgage-backed floating-rate notes due December 2036;

• £40 million class M1 mortgage-backed floating-rate notes due December 2036;

• £32 million class M2 mortgage-backed floating-rate notes due December 2036;

• £12 million class B1 mortgage-backed floating-rate notes due December 2036;

• £14.4 million class B2 mortgage-backed floating-rate notes due December 2036;

• £9.9 million class C mortgage-backed floating-rate notes due December 2036;

• Mortgage early repayment certificates due December 2036; and

• Residual certificates due December 2036.

Holders also will receive accrued interest up to but excluding the optional redemption date.

The supplemental trust deed referenced in the Clifden notice has not been executed, according to the notice.

The issuer said “it has requested but not received any proof of holding from Clifden or sufficient proof that it has been appointed by the relevant noteholders to execute the written resolution referenced in the Clifden notice on their behalf.”

For questions, email directors-uk@intertrustgroup.com.

Background

On March 5, Clifden announced the results of the tender for a number of mortgage-backed debt securities issued under RMAC securitizations in several batches.

The company had said on Jan. 8 that it was tendering for the notes until noon ET on March 7 at a purchase price ranging from 92% to 103% of par of £1,000, €1,000 or $1,000 plus an early tender premium of 1% for notes tendered by the early deadline of noon ET on Jan. 26.

No accrued interest since the last interest payment date will be paid; holders on the record date will receive accrued interest payable on March 12.

Clifden rejected the tenders of notes received from the following issuers: RMAC 2003-NS1, RMAC 2003-NS2, RMAC 2004-NS1 and RMAC 2004-NSP2, according to a company update.

The company also added make-whole provisions across all of the series of motes issued by RMAC 2003-NS3, RMAC 2003-NS4, RMAC 2004-NS3, RMAC 2004-NSP4, RMAC 2005-NS1, RMAC 2005-NSP2, RMAC 2005-NS3 and RMAC 2005-NS4.

The measure passed by means of written resolutions and 100% of each of the tranches had been tendered. The resolutions for RMAC 2003-NS3 and RMAC 2003-NS4 also require the consent of Ambac Assurance UK Ltd. as note controlling party.

Holders who tendered their notes were deemed to consent to the make-whole provision resolutions.

Paratus responds

In a separate notice, Paratus AMC Ltd. said, “The addition of the make-whole and the payment of the indemnity fee would (if implemented) cause significant loss to Paratus AMC as holder of the deferred consideration and residual certificates in the securitization transactions relating to the notes, as well as losses to other holders of such residual certificates.”

Paratus said, “A change to the basis and terms on which noteholders tendered their notes is entirely inappropriate. Neither the appointment of Clifden as noteholders’ agent, the insertion of the make-whole nor the payment of an indemnity fee are contemplated in any way in Clifden’s original tender offer memorandum. They represent a fundamental and unilateral change from a tender process to a process in which Clifden simply seeks to be appointed as agent of noteholders for a temporary period.”

Paratus said it “will consider any action taken by any person (whether acting as agent or principal) which assists Clifden in pursuit of the proposals set out in the Clifden announcement as a potential cause of loss to Paratus AMC.”

“To the extent that Clifden engages in any such interference while acting as agent for the noteholders, noteholders may be held liable for any loss caused as a result,” the release added.

The issuer said on Feb. 20 that it was pushing up the deadline in the tender for some of the mortgage-backed debt securities issued under RMAC securitizations until noon ET on Feb. 26.

The purchase price for the series of notes issued by RMAC 2003-NS1, RMAC 2003-NS2, RMAC 2004-NS1 and RMAC 2004-NSP2 was amended to 105 and the early tender premium changed to zero.

Clifden is a residential and commercial real estate investor based in London.

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