GUARANTOR VARIABLE RATE Sample Clauses
The Guarantor Variable Rate clause establishes that the guarantor's obligations or payments under an agreement are subject to a variable interest rate, rather than a fixed rate. Typically, this means the amount the guarantor must pay can fluctuate over time, often in line with a benchmark rate such as LIBOR or the prime rate, plus a specified margin. This clause ensures that the guarantor's liability reflects changes in market interest rates, thereby allocating the risk of rate fluctuations between the parties and maintaining fairness in the financial arrangement.
GUARANTOR VARIABLE RATE.
4.1 Subject to Section 4.5, the Guarantor hereby grants the Servicer full right, liberty and authority from time to time, subject to and in accordance with the relevant Mortgage Terms, to determine and set the Guarantor Variable Rate chargeable to Borrowers in relation to those Variable Rate Loans sold by the Seller to the Guarantor in the Covered Bond Portfolio for which the reference rate of interest or margins may from time to time be set by the Guarantor at a rate or margin other than the Seller’s Variable Rate. In exercising such right, liberty and authority to set the Guarantor Variable Rate the Servicer undertakes to each of the other parties to this Agreement that it shall set the Guarantor Variable Rate in accordance with the Seller’s Policy, which is the Guarantor’s policy to which the Servicer will adhere, and shall not at any time set or maintain the Guarantor Variable Rate at a rate which is higher than (although such rate may be lower than or equal to) the then prevailing Seller’s Variable Rate (in respect of the same type of Loans, if applicable), except as described in this Article 4. Prior to the occurrence of (i) a Covered Bond Guarantee Activation Event, or (ii) a Servicer Event of Default, the Servicer will not at any time without the prior written consent of the Guarantor, set or maintain the Guarantor Variable Rate at a rate which is higher than (although it may be lower than or equal to) the then prevailing Seller’s Variable Rate which applies to the similar type of loans owned by the Seller.
4.2 The Servicer shall (i) take the steps rendered necessary by the relevant Mortgage Terms and applicable law to bring each change in such rate or rates of interest to the attention of the relevant Borrowers, whether due to a change in the Guarantor Variable Rate or as a consequence of any provisions of the Mortgage Terms; and (ii) notify the Guarantor and the Bond Trustee in writing as soon as reasonably practicable of any change in the Guarantor Variable Rate, provided that posting of any change in the Seller’s Variable Rate on the website of the Seller shall be deemed to constitute notice to the Guarantor and the Bond Trustee of a change in the Guarantor Variable Rate (except to the extent that the Guarantor Variable Rate has been set at a rate other than the Seller Variable Rate in accordance with the terms of this Article 4). All costs arising in relation to such a notification of a change in such rate or rates of interest shall be borne...
GUARANTOR VARIABLE RATE. 6 ARTICLE 5