Gresham Capital CLO IV B.V. - Irish Stock Exchange

any time becomes Margin Stock (as defined under Regulation U issued by the Board of Governors of the United
States Federal Reserve System) or a Dutch Ineligible Security, as soon as practicable following such event.
(m) Redemption of the Notes or Enforcement
In the event of an optional redemption of the Notes pursuant to the Conditions or upon receipt of
notification from the Trustee of the enforcement of the security over the Collateral, the Collateral Manager will
(at the direction of the Trustee following the enforcement of such security) sell all or part of the Portfolio in
order to fund such redemption or prepayment without regard to the foregoing limitations, subject always to any
limitations or restrictions set out in the Conditions and the Trust Deed.
(n) Euro Principal Proceeds and Sterling Principal Proceeds
The Collateral Management Agreement provides that the Collateral Manager, on behalf of the Issuer, may
only use Euro Principal Proceeds to acquire Euro Collateral Debt Securities and Sterling Principal Proceeds to
acquire Sterling Collateral Debt Securities, provided that a Collateral Debt Security denominated in Sterling or
any other non-Euro currency may be acquired by the Collateral Manager on behalf of the Issuer using Euro
Principal Proceeds if such Collateral Debt Security is the subject of an Asset Swap Transaction pursuant to a
Hedge Agreement swapping the Sterling or non-Euro amounts received on such Collateral Debt Security into
Euro.
7. Synthetic Securities, Non-Euro Denominated Securities and PIK Securities
(a) Synthetic Securities
The Collateral Manager, acting on behalf of the Issuer, may from time to time, during the Reinvestment
Period acquire Collateral Debt Securities which are Synthetic Securities. For the avoidance of doubt, any
acquisition of a Synthetic Security shall be subject to Rating Agency Confirmation.
As part of the acquisition of or entry into a Synthetic Security which is a credit default swap transaction, the
Issuer or the Collateral Manager, acting on the Issuer’s behalf, may be required to provide Synthetic Security
Collateral to the applicable Synthetic Security Obligor which it will deposit with a custodian or other third party
as security for its payment obligations to the Synthetic Security Obligor under the Synthetic Security. Subject
as provided below, the Issuer may purchase such Synthetic Security Collateral notwithstanding that it may not
satisfy the Eligibility Criteria, provided that such Synthetic Security Collateral may not include Margin Stock
(as defined under Regulation U issued by the Board of Governors of the United States Federal Reserve System).
For the purposes of the Collateral Management Agreement, the acquisition cost of any Synthetic Security
Collateral shall be included in the purchase price of any Collateral Debt Security that is a Synthetic Security.
The Issuer may grant a first security interest in such Synthetic Security Collateral to the related Synthetic
Security Obligor and a second priority security interest to the Trustee for the benefit of the Secured Parties and
shall cause the Synthetic Security Obligor and the custodian or other third party holding such Synthetic Security
Collateral to be notified of and acknowledge such security interests. Prior to the occurrence of any default under
such Synthetic Security, any payments in respect of Synthetic Security Collateral not retained by the Synthetic
Security Obligor pursuant to the terms of a Synthetic Security shall be paid to the Issuer prior to the release of
the Synthetic Security Collateral. Interest received on the Synthetic Security Collateral shall constitute Euro
Interest Proceeds or Sterling Interest Proceeds, as applicable. Principal payments received thereon shall
constitute Euro Principal Proceeds or Sterling Principal Proceeds, as applicable. Upon any release of Synthetic
Security Collateral from the first priority security interest in favour of the applicable Synthetic Security Obligor
upon termination or sale of such Synthetic Security or otherwise, such Synthetic Security Collateral will:
(i) to the extent that it satisfies the Eligibility Criteria and Reinvestment Criteria, at the discretion of
the Collateral Manager, be retained and shall constitute a Collateral Debt Security; or
(ii) in all other circumstances be sold as soon as reasonably practicable.
Any Distributions received upon liquidation of Synthetic Security Collateral shall be deemed to
constitute:
(A) Sale Proceeds in the event that the Synthetic Security or the Synthetic Security Obligor’s
security interest was terminated by the Collateral Manager or sold or assigned;
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