Common use of GUARANTOR VARIABLE RATE Clause in Contracts

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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌ (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌

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), MT DOCS 14908769v9 7 Servicing Agreement 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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”).. MT DOCS 14908769v9 8 Servicing Agreement (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with MT DOCS 14908769v9 9 Servicing Agreement the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 or the Originator’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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments Payment applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 or the Originator’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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌ (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌

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 TermsHypothecary Loan Conditions and the relevant policy of the Federation, 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 '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 Policyrelevant policy of the Federation, which is the Guarantor’s '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 '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 '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 Hypothecary Loan Conditions 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 TermsHypothecary Loan Conditions; 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 's Variable Rate on the website of the Seller ▇▇▇▇▇▇▇▇▇▇ Group 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 by the Servicer. (a) 4.3.1 Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) 4.3.1.1 the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) 4.3.1.2 the Guarantor Variable Rate and the Seller’s ' s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) 4.3.1.3 the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments Payment applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) 4.3.2 If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Montreal Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank CCDQ that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets Loans and their Related Security should be sold to the Guarantor, CCDQ will, in consultation with the Bank will Limited Partner, use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, or selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) 4.4.1 Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) 4.4.1.1 the Guarantor Variable Rate and the Seller’s 's Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) 4.4.1.2 the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) 4.4.2 If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Daysprior to the Guarantor Payment Date immediately following the relevant Calculation Date, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage TermsHypothecary Loan Conditions), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Hypothecary Lenders. (c) 4.4.3 If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b)4.4.2, the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage TermsHypothecary Loan Conditions, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b)4.4.2. 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s 's Variable Rate in accordance with this Article 4.‌4.

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 or the Originator’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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 or the Originator’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 they 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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments Payment applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Toronto Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the obligations of the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Daysprior to the Guarantor Payment Date immediately following the relevant Calculation Date, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to set for the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap AgreementsAgreement, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments Payment applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Toronto Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets Loans and their Related Security should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the obligations of the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to set for the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will within one Toronto Business Day of such determination give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, Trustee of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion opinion, need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.

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 TermsHypothecary Loan Conditions and the relevant policy of the Federation, 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 '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 Policyrelevant policy of the Federation, which is the Guarantor’s '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 '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 '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 Hypothecary Loan Conditions 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 TermsHypothecary Loan Conditions; 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 's Variable Rate on the website of the Seller Desjardins Group 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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌ (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌

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 by the Servicer. (a) Prior to the occurrence of an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to: (i) the aggregate income which the Guarantor would expect to receive during the next succeeding Guarantor Payment Period (the “Relevant Interest Period”); (ii) the Guarantor Variable Rate and the Seller’s Variable Rate applicable to the Relevant Interest Period in respect of the Loans; and (iii) the other resources available to the Guarantor including the relevant Interest Rate Swap Agreements, the relevant Covered Bond Swap Agreements and the Reserve Fund, whether the Guarantor would receive an amount of income during the Relevant Interest Period which when aggregated with the funds otherwise available to the Guarantor is less than the amount which is the aggregate of (1) the amount of interest which would be payable (or provided to be paid) under the Covered Bond Guarantee on each Guarantor Payment Date falling at the end of the Relevant Interest Period and any relevant amounts which would be payable (or provided to be paid) to the Covered Bond Swap Providers under the Covered Bond Swap Agreements in respect of all Covered Bonds on each Guarantor Payment Date of each Series of Covered Bonds falling at the end of each Relevant Interest Period and (2) the other senior expenses payable by the Guarantor ranking in priority thereto in accordance with the relevant Priorities of Payments applicable prior to a Guarantor Event of Default (the “Guarantor Obligation Shortfall Test”). (b) If the Servicer determines that the Guarantor Obligation Shortfall Test will not be met, it will within one Canadian Business Day of such determination give written notice to the Guarantor and the Bond Trustee of the amount by which the Guarantor Obligation Shortfall Test will not be met. If the Guarantor or the Bond Trustee notifies the Servicer and the Bank that, having regard to the obligations of the Guarantor and the amount of the shortfall, further Portfolio Assets should be sold to the Guarantor, the Bank will use all reasonable efforts to ensure that the Guarantor Obligation Shortfall Test for such period will be met. This may include making Advances under the Intercompany Loan, selling New Loans and their Related Security to the Guarantor, or making a Capital Contribution on or before the next Calculation Date in such amounts and with such rates or margins, as applicable, sufficient to avoid such shortfall on future Calculation Dates. For greater certainty, there shall be no obligation on the Servicer to adjust the Guarantor Variable Rate to ensure the Guarantor Obligation Shortfall Test will be met for the Relevant Interest Period. (a) Following an Issuer Event of Default, the Servicer shall determine on each Calculation Date, having regard to the aggregate of: (i) the Guarantor Variable Rate and the Seller’s Variable Rates applicable to the Relevant Interest Period in respect of the Loans; and (ii) the other resources available to the Guarantor under the Interest Rate Swap Agreement, whether the Guarantor would receive an aggregate amount of interest on the Loans sufficient to pay the full amounts payable under the Interest Rate Swap Agreement during the Relevant Interest Period (the “Post Issuer Event of Default Yield Shortfall Test”). (b) If the Servicer determines that the Post Issuer Event of Default Yield Shortfall Test will not be met, it will give written notice to the Guarantor and the Bond Trustee, within three Canadian Business Days, of the amount of the shortfall and the Guarantor Variable Rate which would (taking into account the applicable Mortgage Terms), in its reasonable opinion need to be set in order for no shortfall to arise and the Post Issuer Event of Default Yield Shortfall Test to be met, having regard to the date(s) (which shall be specified in the notice) on which such change to the Guarantor Variable Rate would take effect and at all times acting in accordance with the standards of Reasonable and Prudent Mortgage Lenders.‌Lenders. (c) If the Guarantor or the Bond Trustee notifies the Servicer that, having regard to the obligations of the Guarantor, the Guarantor Variable Rate should be changed as set out in the notice referred to in Section 4.4(b), the Servicer shall take all steps which are necessary, including publishing any notice which is required in accordance with the Mortgage Terms, to effect such change in the Guarantor Variable Rate on the date(s) specified in the notice referred to in Section 4.4(b). 4.5 The Guarantor and the Bond Trustee may terminate the authority of the Servicer to determine the Guarantor Variable Rate pursuant to the terms of this Article 4 on or after the occurrence of a Servicer Event of Default, in which case the Guarantor and the Bond Trustee will agree to appoint the replacement Servicer to set the Guarantor’s Variable Rate in accordance with this Article 4.‌4.