Exhibit 4.8
AMENDED AND RESTATED CASH MANAGEMENT AGREEMENT
[*] 2006
HALIFAX PLC
AND
PERMANENT MORTGAGES TRUSTEE LIMITED
AND
PERMANENT FUNDING (NO. 1) LIMITED
AND
PERMANENT FUNDING (NO. 2) LIMITED
AND
THE BANK OF NEW YORK
XXXXX & XXXXX
XXXXX & XXXXX LLP
CONTENTS
CLAUSE PAGE
1. DEFINITIONS AND INTERPRETATION.........................................2
2. APPOINTMENT OF CASH MANAGER............................................2
3. THE SERVICES...........................................................3
4. PAYMENTS, ACCOUNTS, LEDGERS............................................4
5. EARLY REPAYMENT FEES...................................................9
6. SWAPS..................................................................9
7. NO LIABILITY..........................................................10
8. COSTS AND EXPENSES....................................................10
9. INFORMATION...........................................................11
10. REMUNERATION..........................................................13
11. COVENANTS OF CASH MANAGER.............................................13
12. SERVICES NON-EXCLUSIVE................................................14
13. TERMINATION...........................................................14
14. FURTHER ASSURANCE.....................................................17
15. MISCELLANEOUS.........................................................17
16. CONFIDENTIALITY.......................................................18
17. NOTICES...............................................................19
18. VARIATION AND WAIVER..................................................20
19. NO PARTNERSHIP........................................................20
20. ASSIGNMENT............................................................20
21. AMENDMENTS............................................................20
22. EXCLUSION OF THIRD PARTY RIGHTS.......................................21
23. COUNTERPARTS..........................................................21
24. GOVERNING LAW AND SUBMISSION TO JURISDICTION..........................21
SCHEDULE
1. The Cash Management Services..........................................22
2. Cash Management and Maintenance of Ledgers............................24
3. Form of Funding 1 Quarterly Report....................................35
4. Form of Funding 2 Quarterly Report....................................37
5. Form of Trust Property Quarterly Report...............................38
SIGNATORIES..................................................................39
THIS CASH MANAGEMENT AGREEMENT is made on [*] 2006
BETWEEN:
(1) HALIFAX PLC, a public limited company incorporated under the laws of
England and Wales whose registered office is at Xxxxxxx Xxxx, Xxxxxxx,
Xxxx Xxxxxxxxx XX0 0XX, in its capacity as CASH MANAGER;
(2) HALIFAX PLC, a public limited company incorporated under the laws of
England and Wales whose registered office is at Xxxxxxx Xxxx, Xxxxxxx,
Xxxx Xxxxxxxxx XX0 0XX, in its capacity as SELLER of the Loans and one
of the BENEFICIARIES;
(3) PERMANENT MORTGAGES TRUSTEE LIMITED (registered number 83116), a private
company incorporated under the laws of Jersey, Channel Islands whose
registered office is at 00 Xxxxxxxxx, Xx. Xxxxxx, Xxxxxx, XX0 0XX,
Channel Islands, in its capacity as the MORTGAGES TRUSTEE;
(4) PERMANENT FUNDING (NO. 1) LIMITED (registered number 4267660), a private
limited company incorporated under the laws of England and Wales whose
registered office is at 00 Xxxxx Xx. Xxxxx'x Xxxxxx XX0X 0XX, in its
capacity as FUNDING 1 and one of the BENEFICIARIES;
(5) PERMANENT FUNDING (NO. 2) LIMITED (registered number 4441772), a private
limited company incorporated under the laws of England and Wales whose
registered office is at 00 Xxxxx Xx. Xxxxx'x Xxxxxx XX0X 0XX, in its
capacity as FUNDING 2 and one of the BENEFICIARIES; and
(6) THE BANK OF NEW YORK, a New York banking corporation acting through its
offices at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX, acting in its
capacity as FUNDING 1 SECURITY TRUSTEE and FUNDING 2 SECURITY TRUSTEE,
which expressions shall include such companies and all other persons or
companies for the time being acting as Funding 1 Security Trustee (or
co-trustee) and/or Funding 1 Security Trustee (or co-trustee) pursuant
to the terms of the Funding 1 Deed of Charge and the Funding 2 Deed of
Charge.
WHEREAS:
(A) On the Initial Closing Date and on several subsequent dates, the Seller
agreed to sell and assign certain mortgage loans (together with their
related security) it had originated to the Mortgages Trustee. The
Mortgage Trustee holds the assigned mortgage loans as bare trustee for
Funding 1, the Seller and following the Funding 2 Programme Date,
Funding 2, pursuant to the terms of the Mortgages Trust Deed.
(B) On the Initial Closing Date and several subsequent Closing Dates,
Funding 1 has used the proceeds of Funding 1 Intercompany Loans granted
to it by Funding 1 Issuers to pay the Seller for an increased share in
the Mortgages Trust. Following the Funding 2 Programme Date, Funding 1
may continue to use the proceeds of Funding 1 Intercompany Loans and
Funding 2 may use the proceeds of Loan Tranches advanced under the
Master Intercompany Loan Agreement to pay the Mortgages Trustee for an
increased share in the Mortgages Trust.
(C) The Cash Manager has agreed to provide Cash Management Services to the
Mortgages Trustee, Funding 1 and Funding 1 Security Trustee on the terms
and subject to the conditions contained in the Cash Management Agreement
dated 14 June 2002, as amended and restated on 12 March 2004 and on 22
March 2006 as amended and restated from time to time (the CASH
MANAGEMENT AGREEMENT) in relation to, inter alia, the Trust Property.
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(D) The parties to the Cash Management Agreement and Funding 2 have agreed
to amend and restate the terms of that Agreement as set out herein.
IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 The amended and restated master definitions and construction schedule
signed by, amongst others, the parties to this Agreement and dated [*]
2006 (as the same may be amended, varied or supplemented from time to
time with the consent of the parties to this Agreement) (the MASTER
DEFINITIONS AND CONSTRUCTION SCHEDULE) is expressly and specifically
incorporated into this Agreement and, accordingly, the expressions
defined in the Master Definitions and Construction Schedule (as so
amended, varied or supplemented from time to time) shall, except where
the context otherwise requires and save where otherwise defined herein,
have the same meanings in this Agreement, including the Recitals hereto
and this Agreement shall be construed in accordance with the
interpretation provisions set out in clause 2 of the Master Definitions
and Construction Schedule.
1.2 This Agreement amends and restates the Cash Management Agreement made on
14 June 2002 as amended and restated on 12 March 2004 and as amended and
restated on 22 March 2006 (the PRINCIPAL AGREEMENT). As of the date of
this Agreement, any future rights or obligations (excluding such
obligations accrued to the date of this Agreement) of a party under the
Principal Agreement shall be extinguished and shall instead be governed
by this Agreement.
1.3 Any reference in this Agreement to any discretion, power or right on the
part of the Mortgages Trustee shall be exercised by the Mortgages
Trustee only as directed by the Beneficiaries but subject in each case
to the provisions of clause 16.2 of the Mortgages Trust Deed.
2. APPOINTMENT OF CASH MANAGER
2.1 APPOINTMENT
Until termination pursuant to Clause 13, the Mortgages Trustee, Funding
1, Funding 2, the Funding 1 Security Trustee and the Funding 2 Security
Trustee (according to their respective estates and interests) each
hereby appoints the Cash Manager as its lawful agent to provide the Cash
Management Services set out in this Agreement, including in relation to:
(a) the Mortgages Trust;
(b) Funding 1; and
(c) Funding 2,
and the Cash Manager in each case hereby accepts such appointment on the
terms and subject to the conditions of this Agreement.
2.2 DUTIES PRESCRIBED BY TRANSACTION DOCUMENTS
For the avoidance of doubt and in connection with the powers conferred
under Clause 2.1, save as expressly provided elsewhere in this
Agreement, nothing herein shall be construed so as to give the Cash
Manager any powers, rights, authorities, directions or obligations other
than as specified in this Agreement or any of the other Transaction
Documents.
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2.3 APPOINTMENT CONDITIONAL UPON ISSUANCE OF FIRST ISSUER NOTES
The appointment pursuant to Clause 2.1 is conditional upon the issue of
the First Issuer Notes and the making of the First Issuer Term Advances
under the First Issuer Intercompany Loan Agreement and shall take effect
upon and from the Initial Closing Date automatically without any further
action on the part of any person PROVIDED THAT if the issue of the First
Issuer Notes by the First Issuer has not occurred by 14 June 2002, or
such later date as the First Issuer and the Lead Manager may agree this
Agreement shall cease to be of further effect.
2.4 APPOINTMENT CONDITIONAL UPON ACQUISITION OF A BENEFICIAL INTEREST
The appointment pursuant to Clause 2.1 is conditional upon the
acquisition by Funding 2 from the Seller of a portion of the Seller's
beneficial interest in the Mortgages Trust pursuant to the Seller Trust
Property Assignment Agreement and shall take effect upon and from the
Funding 2 Programme Date automatically without any further action on the
part of any person PROVIDED THAT if Funding 2 has not acquired from the
Seller a portion of the Seller's beneficial interest in the Mortgages
Trust by [*] 2006, or such later date as Funding 2 and the Seller may
agree, the appointment of the Cash Manager as agent of Funding 2 under
Clause 2.1 shall not take effect.
3. THE SERVICES
3.1 GENERAL
The Cash Manager shall provide the services set out in this Agreement
(including, without limitation, the Schedules to this Agreement) (the
CASH MANAGEMENT SERVICES).
3.2 APPROVALS AND AUTHORISATIONS
The Cash Manager shall maintain, or procure the maintenance of, the
approvals, authorisations, consents and licences required in connection
with the respective businesses of the Mortgages Trustee, Funding 1 and
Funding 2 and shall prepare and submit, or procure the preparation and
submission of, on behalf of the Mortgages Trustee, Funding 1 and Funding
2, all necessary applications and requests for any further approvals,
authorisations, consents or licences which may be required in connection
with the respective businesses of the Mortgages Trustee, Funding 1 and
Funding 2 and shall, so far as it is reasonably able to do so, perform
the Cash Management Services in such a way as not to prejudice the
continuation of any such approvals, authorisations, consents or
licences.
3.3 COMPLIANCE WITH TRANSACTION DOCUMENTS, ETC.
The Cash Management Services shall include procuring (so far as the Cash
Manager, using its reasonable endeavours, is able so to do) compliance
by the Mortgages Trustee, Funding 1 and Funding 2 with all applicable
legal requirements and with the terms of the Transaction Documents to
which each of the Mortgages Trustee and/or Funding 1 and/or Funding 2 is
a party, PROVIDED ALWAYS THAT the Cash Manager shall not lend or provide
any sum to the Mortgages Trustee, Funding 1 or Funding 2 (other than as
expressly contemplated by the Transaction Documents) and the Cash
Manager shall have no liability whatsoever to the Mortgages Trustee,
Funding 1, Funding 2, the Security Trustee or any other person for any
failure by the Mortgages Trustee, Funding 1 or Funding 2 to make any
payment due under any of the Transaction Documents (other than to the
extent arising from (i) the Cash Manager failing to make a payment in
its capacity as Servicer, Funding 1 Swap Provider, Funding 2 Swap
Provider or in any other capacity under the Transaction Documents, or
(ii) the Cash Manager failing to perform any of its obligations under
any of the Transaction Documents).
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3.4 LIABILITY OF CASH MANAGER
(a) The Cash Manager shall indemnify each of the Mortgages Trustee,
Funding 1, Funding 2, the Funding 1 Security Trustee and the
Funding 2 Security Trustee on demand on an after Tax basis for
any loss, liability, claim, expense or damage suffered or
incurred by any of them in respect of the negligence, bad faith
or wilful default of the Cash Manager in carrying out its
functions as Cash Manager under this Agreement or under the
other Transaction Documents or as a result of a breach by the
Cash Manager of the terms and provisions of this Agreement or
such other Transaction Documents to which the Cash Manager is a
party (in its capacity as Cash Manager) in relation to such
functions.
(b) For the avoidance of doubt, the Cash Manager shall not be liable
in respect of any loss, liability, claim, expense or damage
suffered or incurred by the Mortgages Trustee, Funding 1,
Funding 2, the Funding 1 Security Trustee and the Funding 2
Security Trustee and/or any other person as a result of the
proper performance of the Cash Management Services by the Cash
Manager save to the extent that such loss, liability, claim,
expense or damage is suffered or incurred as a result of any
negligence, bad faith or wilful default of the Cash Manager or
as a result of a breach by the Cash Manager of the terms and
provisions of this Agreement or any of the other Transaction
Documents to which the Cash Manager is a party (in its capacity
as Cash Manager) in relation to such functions.
4. PAYMENTS, ACCOUNTS, LEDGERS
4.1 BANK ACCOUNTS
(a) The Cash Manager hereby confirms that the Mortgages Trustee GIC
Account has been established on or before the date hereof
pursuant to the Bank Account Agreement and the Mortgages Trustee
Guaranteed Investment Contract and that the Mortgages Trustee
GIC Account Mandate in the agreed form will apply thereto at the
Initial Closing Date. The Cash Manager undertakes (to the extent
to which the same is within its control) that at the Initial
Closing Date the Mortgages Trustee GIC Account will be operative
and that the Cash Manager will not create or permit to subsist
any Funding 1 Security Trustee and/or any Funding 2 Security
Trustee in relation to the Mortgages Trustee GIC Account (but
without prejudice to the Mortgages Trust).
(b) The Cash Manager hereby confirms that the Funding 1 GIC Account
has been established on or before the date hereof pursuant to
the Bank Account Agreement and the Funding 1 Guaranteed
Investment Contract and that the Funding 1 GIC Account Mandate
in the agreed form will apply thereto at the Initial Closing
Date. The Cash Manager undertakes (to the extent to which the
same is within its control) that at the Initial Closing Date the
Funding 1 GIC Account will be operative and that the Cash
Manager will not knowingly create or permit to subsist any
Funding 1 Security Trustee in relation to the Funding 1 GIC
Account other than as created under or permitted pursuant to the
Funding 1 Deed of Charge.
(c) The Cash Manager hereby confirms that the Funding 1 Transaction
Account has been established on or before the date hereof and
that the Funding 1 Transaction Account Mandate in the agreed
form will apply thereto at the Initial Closing Date. The Cash
Manager undertakes (to the extent to which the same is within
its control) that at the Initial Closing Date the Funding 1
Transaction Account will be operative and that the Cash Manager
will not knowingly create or permit to subsist any Funding 1
Security Trustee in relation to the Funding 1 Transaction
Account other than as created under or permitted pursuant to the
Funding 1 Deed of Charge.
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(d) The Cash Manager hereby confirms that the Funding 2 GIC Account
has been established on or before the Funding 2 Programme Date
pursuant to the Bank Account Agreement and the Funding 2
Guaranteed Investment Contract and that the Funding 2 GIC
Account Mandate in the agreed form will apply thereto at the
Funding 2 Programme Date. The Cash Manager undertakes (to the
extent to which the same is within its control) that at the
Funding 2 Programme Date the Funding 2 GIC Account will be
operative and that the Cash Manager will not knowingly create or
permit to subsist any Funding 2 Security Trustee in relation to
the Funding 2 GIC Account other than as created under or
permitted pursuant to the Funding 2 Deed of Charge.
(e) The Cash Manager hereby confirms that the Funding 2 Transaction
Account has been established on or before the Funding 2
Programme Date and that the Funding 2 Transaction Account
Mandate in the agreed form will apply thereto at the Funding 2
Programme Date. The Cash Manager undertakes (to the extent to
which the same is within its control) that at the Funding 2
Programme Date the Funding 2 Transaction Account will be
operative and that the Cash Manager will not knowingly create or
permit to subsist any Funding 1 Security Trustee in relation to
the Funding 2 Transaction Account other than as created under or
permitted pursuant to the Funding 2 Deed of Charge.
4.2 MORTGAGES TRUSTEE LEDGERS
(a) The Cash Manager shall open and maintain in the books of the
Mortgages Trustee certain ledgers to be known as the Revenue
Ledger and the Principal Ledger which shall together reflect the
aggregate of all amounts of cash standing to the credit of the
Mortgages Trustee GIC Account from time to time.
(b) The Cash Manager shall also open and maintain in the books of
the Mortgages Trustee certain ledgers to be known as the Losses
Ledger and the Funding 1 Share/Funding 2 Share/Seller Share
Ledger.
(c) The Cash Manager shall make credits and debits to the Mortgages
Trustee Ledgers in the manner described in SCHEDULE 2.
4.3 FUNDING 1 LEDGERS
(a) The Cash Manager shall open and maintain in the books of Funding
1 certain ledgers to be known as the Funding 1 Revenue Ledger,
the Funding 1 Principal Ledger, the Funding 1 General Reserve
Ledger, the Funding 1 Cash Accumulation Ledger and, if the
Funding 1 Liquidity Reserve Fund is established, the Funding 1
Liquidity Reserve Ledger which shall together reflect the
aggregate of all amounts of cash standing to the credit of the
Funding 1 GIC Account and the Funding 1 Transaction Account and
all amounts invested in Authorised Investments purchased from
amounts standing to the credit of the Funding 1 GIC Account and
the Funding 1 Transaction Account from time to time.
(b) The Cash Manager shall also open and maintain in the books of
Funding 1 certain ledgers to be known as (i) the Funding 1
Principal Deficiency Ledger, which comprised, on the Initial
Closing Date, three sub-ledgers known as the AAA Principal
Deficiency Sub Ledger, the AA Principal Deficiency Sub Ledger
and the BBB Principal Deficiency Sub Ledger, and shall comprise
on the Fourth Issuer Closing Date, four sub-ledgers known as the
AAA Principal Deficiency Sub Ledger, the AA Principal Deficiency
Sub Ledger, the A Principal Deficiency Sub Ledger, and the BBB
Principal Deficiency Sub Ledger (ii) the Funding 1 Intercompany
Loan Ledger and (iii) the Funding 1 Liquidity Facility Ledger.
If Funding 1 enters into New Intercompany Loan Agreements and
the New Term Advances advanced thereunder have different
Term Advance Ratings to the Term Advance Ratings assigned to
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the existing Term Advances (including the Fourth Issuer Term
Advances), then the Cash Manager shall establish new sub-ledgers
in respect of the Funding 1 Principal Deficiency Ledger, which
shall correspond to the Term Advance Ratings assigned to each
such New Term Advance.
(c) The Cash Manager shall make credits and debits to the Funding 1
Ledgers in accordance with the provisions of SCHEDULE 2.
4.4 FUNDING 2 LEDGERS
(a) The Cash Manager shall open and maintain in the books of Funding
2 certain ledgers to be known as the Funding 2 Revenue Ledger,
the Funding 2 Principal Ledger, the Funding 2 General Reserve
Ledger, the Funding 2 Cash Accumulation Ledger and, if the
Funding 2 Liquidity Reserve Fund is established, the Funding 2
Liquidity Reserve Ledger which shall together reflect the
aggregate of all amounts of cash standing to the credit of the
Funding 2 GIC Account and the Funding 2 Transaction Account and
all amounts invested in Authorised Investments purchased from
amounts standing to the credit of the Funding 2 GIC Account and
the Funding 2 Transaction Account from time to time.
(b) The Cash Manager shall also open and maintain in the books of
Funding 2 certain ledgers to be known as (i) the Funding 2
Principal Deficiency Ledger, which comprised, on the Funding 2
Programme Date, five sub-ledgers known as the AAA Principal
Deficiency Sub Ledger, the AA Principal Deficiency Sub Ledger,
the A Principal Deficiency Sub Ledger, the BBB Principal
Deficiency Sub Ledger and the BB Principal Deficiency Sub Ledger
and (ii) the Master Intercompany Loan Ledger, to be divided into
sub-ledgers each of which shall record payments made under each
Loan Tranche.
(c) The Cash Manager shall make credits and debits to the Funding 1
Ledgers in accordance with the provisions of SCHEDULE 2.
4.5 BANK ACCOUNTS
(a) The Cash Manager shall procure that so far as it may be able in
relation to all Loans comprised in the Portfolio, the following
amounts are paid into the Mortgages Trustee GIC Account:
(i) all Monthly Payments, other interest received under and in
respect of the Loans and any costs or other amounts received
under the Loans (including in any such case amounts recovered on
enforcement of rights against any Borrower or guarantor of the
Borrower, any Property or any of the Borrower's or guarantor's
other property or assets);
(ii) all final releases and all repayments or prepayments of
principal under the Loans;
(iii) any amount received by or on behalf of the Mortgages Trustee
pursuant to any Halifax Insurance Policy or the Buildings
Policies; and
(iv) any other amounts whatsoever received by or on behalf of the
Mortgages Trustee after the Initial Closing Date,
and the Cash Manager shall procure that all interest earned on the
Mortgages Trustee GIC Account is credited to such account.
(b) The Cash Manager shall procure that the following amounts are
paid into the Funding 1 GIC Account:
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(i) all Funding 1 Revenue Receipts;
(ii) all Funding 1 Principal Receipts;
(iii) all amounts received by Funding 1 pursuant to the Funding 1 Swap
Agreement; and
(iv) any other amounts whatsoever received by or on behalf of Funding
1 after the Initial Closing Date,
and the Cash Manager shall procure that all interest earned on the
Funding 1 Bank Accounts and all investment proceeds from Authorised
Investments purchased from amounts standing to the credit of the Funding
1 GIC Account are credited to such account.
(c) The Cash Manager shall procure that all Liquidity Drawings under
the Funding 1 Liquidity Facility are paid into the Funding 1
Transaction Account.
(d) The Cash Manager shall procure that all transfers and
withdrawals of amounts standing to the credit of the Funding 1
Transaction Account and the Funding 1 GIC Account shall be made
in accordance with the provisions of the Funding 1 Deed of
Charge.
(e) The Cash Manager shall procure that the following amounts are
paid into the Funding 2 GIC Account:
(i) all Funding 2 Revenue Receipts;
(ii) all Funding 2 Principal Receipts;
(iii) all amounts received by Funding 2 pursuant to the Funding 2 Swap
Agreement; and
(iv) any other amounts whatsoever received by or on behalf of Funding
2 after the Funding 2 Programme Date,
and the Cash Manager shall procure that all interest earned on the
Funding 2 Bank Accounts and all investment proceeds from Authorised
Investments purchased from amounts standing to the credit of the Funding
2 GIC Account are credited to such account.
(f) The Cash Manager shall procure that all transfers and
withdrawals of amounts standing to the credit of the Funding 2
Transaction Account and the Funding 2 GIC Account shall be made
in accordance with the provisions of the Funding 2 Deed of
Charge.
(g) Each of the payments into the Mortgages Trustee GIC Account, the
Funding 1 GIC Account, the Funding 1 Transaction Account, the
Funding 2 GIC Account and the Funding 2 Transaction Account
referred to in Clauses 4.5(a), (b), (c), (d), (e), (f) and (g)
shall be made forthwith upon receipt by the Mortgages Trustee,
Funding 1, Funding 2 or the Cash Manager, as the case may be, of
the amount in question.
(h) For the avoidance of doubt, as soon as reasonably practicable
after becoming aware of the same, the Cash Manager may, and
shall, withdraw Cash from, as the case may be, the
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Mortgages Trustee GIC Account, the Funding 1 Transaction
Account, the Funding 1 GIC Account, the Funding 2 Transaction
Account and/or the Funding 2 GIC Account if, and to the extent
that, such Cash was credited thereto in error and shall use its
reasonable endeavours to ensure that such Cash is applied
correctly thereafter.
(i) The Cash Manager shall promptly notify each of the Mortgages
Trustee, Funding 1 (in the case of Funding 1 Bank Accounts),
Funding 2 (in the case of Funding 2 Bank Accounts) and the
Security Trustee of any additional account which supplements or
replaces any account specifically referred to in the definitions
of the "Mortgages Trustee GIC Account", the "Funding 1
Transaction Account", the "Funding 1 GIC Account", the "Funding
2 Transaction Account" or the "Funding 2 GIC Account", as the
case may be, in the Master Definitions and Construction
Schedule.
(j) Each of the Cash Manager, the Mortgages Trustee, Funding 1 (in
the case of Funding 1 Bank Accounts) and Funding 2 (in the case
of Funding 2 Bank Accounts) undertakes that, so far as it is
able to procure the same, the Mortgages Trustee GIC Account, the
Funding 1 Transaction Account, the Funding 1 GIC Account, the
Funding 2 Transaction Account and the Funding 2 GIC Account and
all instructions and Mandates in relation thereto will continue
to be operative and will not, save as provided in Clause 4.7
below or as permitted pursuant to the Bank Account Agreement be
changed without the prior written consent of the Security
Trustee (such consent not to be unreasonably withheld or
delayed). For the avoidance of doubt, the Cash Manager may
change the Authorised Signatories in respect of any instructions
or Mandates relating to Funding 1, Funding 2 and/or the
Mortgages Trustee, without the prior written consent of the
Security Trustee, in accordance with Clause 4.2 of the Bank
Account Agreement.
(k) The Cash Manager and Funding 1 agree that the Cash Manager shall
procure that (i) the tranche of the Advance being made available
to Funding 1 pursuant to paragraph 2(a) of the First Start-Up
Loan Agreement for the purposes of funding the Funding 1 General
Reserve Fund and (ii) the tranche (if any) of any New Start-up
Loan Agreement for the purposes of funding further the Funding 1
General Reserve Fund (or any other similar reserve fund) shall
be credited to the Funding 1 GIC Account promptly upon receipt
of such amounts by Funding 1, and the Funding 1 General Reserve
Ledger shall record such credit.
(l) The Cash Manager and Funding 2 agree that the Cash Manager shall
procure that (i) any Advance being made available to Funding 2
pursuant to Clause [*] of the Funding 2 Start-Up Loan Agreement
for the purposes of funding the Funding 2 General Reserve Fund
(or any other similar reserve fund) and (ii) any Advance (if
any) of any new Funding 2 Start-up Loan Agreement for the
purposes of funding further the Funding 2 General Reserve Fund
(or any other similar reserve fund) shall be credited to the
Funding 2 GIC Account promptly upon receipt of such amounts by
Funding 2, and the Funding 2 General Reserve Ledger shall record
such credit.
(m) The Cash Manager shall give all notices and make all
determinations and withdrawals under the Funding 1 Liquidity
Facility Agreement on behalf of Funding 1, as set out therein.
4.6 WITHDRAWALS
The Cash Manager may make withdrawals:
(a) on behalf of the Mortgages Trustee from the Mortgages Trustee
GIC Account; and
(b) on behalf of Funding 1 from the Funding 1 GIC Account and the
Funding 1 Transaction Account, but only until receipt of an
Intercompany Loan Acceleration Notice served
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by the Funding 1 Security Trustee on Funding 1 (with a copy to
the Cash Manager and the Mortgages Trustee); and
(c) on behalf of Funding 2 from the Funding 2 GIC Account and the
Funding 2 Transaction Account, but only until receipt of a
Master Intercompany Loan Acceleration Notice served by the
Funding 2 Security Trustee on Funding 2 (with a copy to the Cash
Manager and the Mortgages Trustee),
respectively as permitted by this Agreement, the Mortgages Trust Deed,
the Bank Account Agreement, the Mortgages Trustee Guaranteed Investment
Contract, the Funding 1 Guaranteed Investment Contract, the Funding 2
Guaranteed Investment Contract, the Funding 1 Liquidity Facility
Agreement, the Funding 1 Deed of Charge and the Funding 2 Deed of
Charge, but shall not in carrying out its functions as Cash Manager
under this Agreement otherwise make withdrawals from the Mortgages
Trustee GIC Account, the Funding 1 Bank Accounts or the Funding 2 Bank
Accounts.
4.7 CASH MANAGEMENT
In administering the Mortgages Trustee GIC Account, the Funding 1 Bank
Accounts and the Funding 2 Bank Accounts on behalf of the Mortgages
Trustee, Funding 1, Funding 2 and the Security Trustee respectively, the
Cash Manager shall comply with the provisions of SCHEDULE 2 prior to
receipt by the Cash Manager of a copy of any Intercompany Loan
Acceleration Notice (in respect of the Funding 1 Bank Accounts) served
by the Security Trustee on Funding 1 and any Master Intercompany Loan
Acceleration Notice (in respect of the Funding 2 Bank Accounts) served
by the Security Trustee on Funding 2.
5. EARLY REPAYMENT FEES
The Cash Manager shall withdraw any Early Repayment Fees paid into the
Mortgages Trustee GIC Account and pay the same to the Seller, by
telegraphic transfer to such account as may be specified by the Seller
from time to time, promptly following a request for such withdrawal
being received from the Seller. For the avoidance of doubt, the Cash
Manager shall not record the receipt or withdrawal of Early Repayment
Fees in any of the ledgers maintained under this Agreement.
6. SWAPS
6.1 COMPUTATIONS UNDER FUNDING 1 SWAP
On each Calculation Date, the Cash Manager shall determine, in
accordance with the terms of the Funding 1 Swap, in respect of the
relevant Calculation Period:
(a) the Average Fixed Rate Loan Balance, the Average Variable Rate
Loan Balance and the Average Tracker Rate Loan Balance (each as
defined in the Funding 1 Swap Agreement);
(b) the weighted average of the fixed rates of interest charged to
borrowers of Fixed Rate Loans;
(c) the Tracker Swap Rate; and
(d) the Variable Rate Swap SVR,
and shall notify Funding 1 and the Funding 1 Security Trustee of such
amounts, balances and rates.
6.2 TERMINATION OF FUNDING 1 SWAP
If on or prior to the date of the earlier of either (i) the reduction of
the aggregate principal amount outstanding of all Intercompany Loans to
zero or (ii) the service of an Intercompany Loan Acceleration Notice,
the Funding 1 Swap is terminated, then the Cash Manager (on behalf of
Funding 1 and the Security Trustee) shall purchase a new hedge against
the possible variance between (1) the Mortgages Trustee Variable Base
Rate payable on the Variable Rate Loans, the
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fixed rates of interest payable on the Fixed Rate Loans and the Tracker
Swap Rate and (2) a LIBOR-based rate for three-month sterling deposits,
on terms acceptable to Funding 1 and the Rating Agencies with a new
Funding 1 swap provider whom the Rating Agencies have previously
confirmed in writing will not cause the then current rating of any Notes
of the Funding 1 Issuers to be downgraded. The Cash Manager may apply
any early termination payment received from the Funding 1 Swap Provider
pursuant to the Funding 1 Swap for such purpose.
6.3 COMPUTATIONS UNDER FUNDING 2 SWAP
On each Calculation Date, the Cash Manager shall determine, in
accordance with the terms of the Funding 2 Swap, in respect of the
relevant Calculation Period:
(a) the Average Fixed Rate Loan Balance, the Average Variable Rate
Loan Balance and the Average Tracker Rate Loan Balance (each as
defined in the Funding 2 Swap Agreement);
(b) the weighted average of the fixed rates of interest charged to
borrowers of Fixed Rate Loans;
(c) the Tracker Swap Rate; and
(d) the Variable Rate Swap SVR,
and shall notify Funding 2 and the Funding 2 Security Trustee of such
amounts, balances and rates.
6.4 TERMINATION OF FUNDING 2 SWAP
If on or prior to the date of the earlier of either (i) the reduction of
the aggregate principal amount outstanding of all Loan Tranches under
the Master Intercompany Loan Agreement to zero or (ii) the service of a
Master Intercompany Loan Acceleration Notice, the Funding 2 Swap is
terminated, then the Cash Manager (on behalf of Funding 2 and the
Security Trustee) shall purchase a new hedge against the possible
variance between (1) the Mortgages Trustee Variable Base Rate payable on
the Variable Rate Loans, the fixed rates of interest payable on the
Fixed Rate Loans and the Tracker Swap Rate and (2) a LIBOR-based rate
for three-month sterling deposits, on terms acceptable to Funding 2 and
the Rating Agencies with a new Funding 2 swap provider whom the Rating
Agencies have previously confirmed in writing will not cause the then
current rating of any Notes of the Master Issuer to be downgraded. The
Cash Manager may apply any early termination payment received from the
Funding 2 Swap Provider pursuant to the Funding 2 Swap for such purpose.
7. NO LIABILITY
Save as otherwise provided in this Agreement, the Cash Manager shall
have no liability for the obligations of any of the Mortgages Trustee,
Funding 1, Funding 2, the Funding 1 Security Trustee or the Funding 2
Security Trustee under any of the Transaction Documents or otherwise and
nothing herein shall constitute a guarantee, or similar obligation, by
the Cash Manager of either the Mortgages Trustee, Funding 1, Funding 2,
the Funding 1 Security Trustee or the Funding 2 Security Trustee in
respect of any of them.
8. COSTS AND EXPENSES
8.1 Subject to and in accordance with the Mortgages Trust Revenue Priority
of Payments, the Mortgages Trustee on behalf of itself and the
Beneficiaries will on each Distribution Date reimburse the Cash Manager
for all out-of-pocket costs, expenses and charges (together with any
amounts in respect of Irrecoverable VAT due thereon) properly incurred
by the Cash Manager in the performance of the Cash Management Services
including any such costs, expenses or charges not reimbursed to the Cash
Manager on any previous Distribution Date and the Cash Manager shall
supply the Mortgages
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Trustee with an appropriate VAT invoice issued by the Cash Manager or,
if the Cash Manager has treated the relevant cost, expense or charge as
a disbursement for VAT purposes, by the person making the supply.
8.2 Unless and until otherwise agreed by Funding 1, Funding 2, the Mortgages
Trustee, the Funding 1 Security Trustee and the Funding 2 Security
Trustee in writing (notified to the Cash Manager), the Mortgages Trustee
shall be solely responsible for reimbursing the Cash Manager for the
out-of-pocket costs, expenses and charges (together with any amounts in
respect of Irrecoverable VAT due thereon) referred to in Clause 8.1
above.
9. INFORMATION
9.1 USE OF I.T. SYSTEMS
(a) The Cash Manager represents and warrants that at the date hereof
in respect of the software which is to be used by the Cash
Manager in providing the Cash Management Services it has in
place all necessary licences and/or consents from the respective
licensor or licensors (if any) of such software.
(b) The Cash Manager undertakes that it shall for the duration of
this Agreement, use reasonable endeavours to:
(i) ensure that the licences and/or consents referred to in
paragraph (a) are maintained in full force and effect; and
(ii) except in so far as it would breach any other of its legal
obligations, grant to any person to whom it may sub-contract or
delegate the performance of all or any of its powers and
obligations under this Agreement and/or to such person as the
Mortgages Trustee and/or Funding 1 and/or Funding 2 elect as a
substitute cash manager in accordance with the terms of this
Agreement a licence to use any proprietary software together
with any updates which may be made thereto from time to time.
(c) The Cash Manager shall use reasonable endeavours to maintain in
working order the information technology systems used by the
Cash Manager in providing the Cash Management Services.
(d) The Cash Manager shall pass to any person to whom it may
sub-contract or delegate the performance of all or any of its
powers and obligations under this Agreement and/or to such
person as the Mortgages Trustee and/or Funding 1 and/or Funding
2 elect as a substitute cash manager in accordance with the
terms of this Agreement the benefit of any warranties in
relation to the software insofar as the same are capable of
assignment.
9.2 BANK ACCOUNT STATEMENTS
The Cash Manager shall take all reasonable steps to ensure that it
receives:
(a) a monthly bank statement in relation to the Mortgages Trustee
GIC Account (and any additional or supplemental bank account of
the Mortgages Trustee) and that it furnishes a copy of such
statement to the Mortgages Trustee, each of the Beneficiaries,
the Funding 1 Security Trustee and the Funding 2 Security
Trustee ;
(b) monthly bank statements in relation to each of the Funding 1
Transaction Account and the Funding 1 GIC Account (and any
additional or supplemental bank account of Funding 1)
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and that it furnishes a copy of such statements to Funding 1 and
the Funding 1 Security Trustee; and
(c) monthly bank statements in relation to each of the Funding 2
Transaction Account and the Funding 2 GIC Account (and any
additional or supplemental bank account of Funding 2) and that
it furnishes a copy of such statements to Funding 2 and the
Funding 2 Security Trustee.
9.3 ACCESS TO BOOKS AND RECORDS
Subject to all applicable laws, the Cash Manager shall permit the
Auditors of the Mortgages Trustee, Funding 1 and Funding 2 and any other
person nominated by the Funding 1 Security Trustee and/or Funding 2
Security Trustee or the Beneficiaries (to whom the Cash Manager has no
reasonable objection) at any time during normal office hours upon
reasonable notice to have access, or procure that such person or persons
are granted access, to all books of record and account relating to the
Cash Management Services provided by the Cash Manager and related
matters in accordance with this Agreement.
9.4 STATUTORY OBLIGATIONS
The Cash Manager will use its reasonable endeavours, on behalf of the
Mortgages Trustee, Funding 1 and Funding 2, to prepare or procure the
preparation of and file all reports, annual returns, financial
statements, statutory forms and other returns which each of the
Mortgages Trustee, Funding 1 and Funding 2 is required by law to prepare
and file. Subject to approval thereof by the directors of the Mortgages
Trustee, Funding 1 or Funding 2 (as appropriate), the Cash Manager shall
cause such accounts to be audited by the Auditors and shall procure so
far as it is able so to do that the Auditors shall make a report thereon
as required by law and copies of all such documents shall be delivered
to the Mortgages Trustee, the Funding 1 Security Trustee, the Funding 2
Security Trustee, Funding 1 and Funding 2 (as appropriate) and the
Rating Agencies as soon as practicable after the end of each accounting
reference period of the Mortgages Trustee, Funding 1 or Funding 2 (as
appropriate).
9.5 INFORMATION COVENANTS
(a) The Cash Manager shall provide a quarterly report in, or
substantially in, the form set out in Schedule 3 in respect of
Funding 1 to any Funding 1 Issuer, Funding 1, the Funding 1
Security Trustee, the Seller and the Rating Agencies and a
quarterly report in, or substantially in the form set out in
Schedule 4 in respect of Funding 2 to the Master Issuer, Funding
2, the Funding 2 Security Trustee, the Seller and the Rating
Agencies.
(b) The Cash Manager shall provide a quarterly report in, or
substantially in, the form set out in Schedule 5 in respect of
the Trust Property to the Mortgages Trustee, Funding 1, Funding
2, the Funding 1 Security Trustee, the Funding 2 Security
Trustee and the Rating Agencies.
(c) The Cash Manager shall provide, or procure the provision of, to
the Mortgages Trustee, Funding 1, Funding 2, the Funding 1
Security Trustee, the Funding 2 Security Trustee and the Rating
Agencies copies of any annual returns or financial statements
referred to in Clause 9.4 as soon as reasonably practicable
after the preparation thereof.
(d) The Cash Manager shall notify the Rating Agencies in writing of
the details of (i) any material amendment to the Transaction
Documents, (ii) the occurrence of an Intercompany Loan Event of
Default, Master Intercompany Loan Event of Default, Potential
Intercompany Loan Event of Default or Potential Mater
Intercompany Loan Event of Default and (iii) any other
information relating to the Cash Manager as the Rating Agencies
and the Funding 1
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Security Trustee and the Funding 2 Security Trustee may
reasonably request in connection with its obligations under this
Agreement, PROVIDED THAT the Funding 1 Security Trustee and the
Funding 2 Security Trustee shall not make such a request more
than once every three months unless, in the belief of the
Funding 1 Security Trustee and/or the Funding 2 Security
Trustee, an Intercompany Loan Event of Default, a Master
Intercompany Loan Event of Default, a Note Event of Default in
respect of any Funding 1 Issuer or the Master Issuer, or Cash
Manager Termination Event (as defined in Clause 13.1) shall have
occurred and is continuing or a Potential Intercompany Loan
Event of Default, Potential Master Intercompany Loan Event of
Default or a Potential Note Event of Default in respect of any
Funding 1 Issuer or the Master Issuer shall have occurred and is
continuing PROVIDED FURTHER THAT such request does not adversely
interfere with the Cash Manager's day to day provision of the
Cash Management Services under the other terms of this
Agreement.
(e) The Cash Manager shall, at the request of the Funding 1 Security
Trustee and the Funding 2 Security Trustee, furnish the Funding
1 Security Trustee, the Funding 2 Security Trustee and the
Rating Agencies with such other information relating to its
business and financial condition as it may be reasonable for the
Funding 1 Security Trustee and the Funding 2 Security Trustee to
request in connection with this Agreement, PROVIDED THAT such
request does not adversely interfere with the Cash Manager's day
to day provision of the Cash Management Services under the other
terms of this Agreement.
10. REMUNERATION
10.1 FEE PAYABLE
(a) Subject to paragraph (b) below, the Mortgages Trustee shall pay
to the Cash Manager for its Cash Management Services hereunder a
cash management fee which shall be agreed in writing between the
Mortgages Trustee, the Funding 1 Security Trustee, the Funding 2
Security Trustee and the Cash Manager from time to time.
(b) Unless and until otherwise agreed by the Mortgages Trustee,
Funding 1, Funding 2, the Funding 1 Security Trustee and the
Funding 2 Security Trustee in writing (notified to the Cash
Manager), the Mortgages Trustee shall be solely responsible for
paying the cash management fee to the Cash Manager which is
referred to in paragraph (a) above.
10.2 PAYMENT OF FEE
The cash management fee referred to in Clause 10.1 shall be paid to the
Cash Manager in arrear on each Distribution Date in the manner
contemplated by and in accordance with the provisions of the Mortgages
Trustee Revenue Priority of Payments.
11. COVENANTS OF CASH MANAGER
11.1 COVENANTS
The Cash Manager hereby covenants with and undertakes to each of the
Mortgages Trustee, Funding 1, Funding 2, the Funding 1 Security Trustee
and the Funding 2 Security Trustee that without prejudice to any of its
specific obligations hereunder:
(a) it will devote all due skill, care and diligence to the
performance of its obligations and the exercise of its
discretions hereunder;
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(b) it will comply with any proper directions, orders and
instructions which the Mortgages Trustee, Funding 1, Funding 2,
the Funding 1 Security Trustee or the Funding 2 Security Trustee
may from time to time give to it in accordance with the
provisions of this Agreement and, in the event of any conflict,
those of the Security Trustee shall prevail;
(c) it will use its reasonable endeavours to keep in force all
licences, approvals, authorisations and consents which may be
necessary in connection with the performance of the Cash
Management Services and prepare and submit all necessary
applications and requests for any further approval,
authorisation, consent or licence required in connection with
the performance of the Cash Management Services;
(d) save as otherwise agreed with the Mortgages Trustee, Funding 1,
Funding 2 and the Security Trustee, it will provide free of
charge to the Mortgages Trustee, Funding 1 and Funding 2 during
normal office hours office space, facilities, equipment and
staff sufficient to fulfil the obligations of the Mortgages
Trustee, Funding 1 and Funding 2 under this Agreement;
(e) it will not knowingly fail to comply with any legal requirements
in the performance of the Cash Management Services;
(f) it will make all payments required to be made by it pursuant to
this Agreement on the due date for payment thereof for value on
such day without set-off (including, without limitation, in
respect of any fees owed to it) or counterclaim; and
(g) it will not without the prior written consent of the Security
Trustee amend or terminate any of the Transaction Documents save
in accordance with their terms.
11.2 DURATION OF COVENANTS
The covenants of the Cash Manager in Clause 11.1 shall remain in force
until this Agreement is terminated but without prejudice to any right or
remedy of the Mortgages Trustee and/or Funding 1 and/or Funding 2 and/or
the Security Trustee arising from breach of any such covenant prior to
the date of termination of this Agreement.
12. SERVICES NON-EXCLUSIVE
Nothing in this Agreement shall prevent the Cash Manager from rendering
or performing services similar to those provided for in this Agreement
to or for itself or other persons, firms or companies or from carrying
on business similar to or in competition with the business of the
Mortgages Trustee, Funding 1, Funding 2 or the Security Trustee.
13. TERMINATION
13.1 CASH MANAGER TERMINATION EVENTS
If any of the following events (CASH MANAGER TERMINATION EVENTS) shall
occur:
(a) default is made by the Cash Manager in the payment on the due
date of any payment due and payable by it under this Agreement
or in the performance of its obligations under Clauses 4.5 and
4.6 and such default continues unremedied for a period of three
London Business Days after the earlier of the Cash Manager
becoming aware of such default; or
(b) default is made by the Cash Manager in the performance or
observance of any of its other covenants and obligations under
this Agreement, which in the reasonable opinion of the Funding 1
Security Trustee is materially prejudicial to the interests of
the Funding 1 Secured
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Creditors (in the case of Funding 1) or the Funding 2 Secured
Creditors (in the case of Funding 2) and such default continues
unremedied for a period of twenty London Business Days after the
earlier of the Cash Manager becoming aware of such default and
receipt by the Cash Manager of written notice from the Security
Trustee requiring the same to be remedied;
(c) an Insolvency Event occurs,
then Funding 1 and/or Funding 2 and/or the Security Trustee may at once
or at any time thereafter while such default continues by notice in
writing to the Cash Manager terminate its appointment as Cash Manager
under this Agreement with effect from a date (not earlier than the date
of the notice) specified in the notice.
13.2 RESIGNATION OF CASH MANAGER
The appointment of the Cash Manager under this Agreement may be
terminated upon the expiry of not less than 12 months' notice of
termination given by the Cash Manager to the Mortgages Trustee, Funding
1, Funding 2 and the Security Trustee PROVIDED THAT:
(a) the Mortgages Trustee, Funding 1, Funding 2 and the Security
Trustee consent in writing to such termination;
(b) a substitute cash manager shall be appointed, such appointment
to be effective not later than the date of such termination;
(c) such substitute cash manager has cash management experience and
is approved by the Mortgages Trustee, Funding 1, Funding 2 and
the Security Trustee;
(d) the substitute cash manager enters into an agreement
substantially on the same terms as the relevant provisions of
this Agreement and the Cash Manager shall not be released from
its obligations under the relevant provisions of this Agreement
until such substitute cash manager has entered into such new
agreement and the rights of the Mortgages Trustee, Funding 1 and
Funding 2 under such agreement are charged in favour of the
Security Trustee on terms satisfactory to the Security Trustee;
and
(e) the then current ratings of the Notes are not adversely affected
as a result thereof, unless otherwise agreed by an Extraordinary
Resolution of the holders of each class of the Notes of each
Funding 1 Issuer or the Master Issuer, as applicable.
13.3 EFFECT OF TERMINATION
(a) On and after termination of the appointment of the Cash Manager
under this Agreement pursuant to this Clause 13, all authority
and power of the Cash Manager under this Agreement shall be
terminated and be of no further effect and the Cash Manager
shall not thereafter hold itself out in any way as the agent of
the Mortgages Trustee, Funding 1, Funding 2 or the Security
Trustee pursuant to this Agreement.
(b) Upon termination of the appointment of the Cash Manager under
this Agreement pursuant to this Clause 13, the Cash Manager
shall:
(i) forthwith deliver (and in the meantime hold on trust for, and to
the order of, the Mortgages Trustee, Funding 1, Funding 2 or the
Security Trustee, as the case may be) to the Mortgages Trustee,
Funding 1, Funding 2 or the Security Trustee, as the case may be
or as it shall direct, all books of account, papers, records,
registers, correspondence and documents in its
15
possession or under its control relating to the affairs of or
belongings of the Mortgages Trustee, Funding 1, Funding 2 or the
Security Trustee, as the case may be (if practicable, on the
date of receipt), any monies then held by the Cash Manager on
behalf of the Mortgages Trustee, Funding 1, Funding 2 or, the
Security Trustee and any other assets of the Mortgages Trustee,
Funding 1, Funding 2 and the Security Trustee;
(ii) take such further action as the Mortgages Trustee, Funding 1,
Funding 2 or the Security Trustee, as the case may be, may
reasonably direct at the expense of the Mortgages Trustee,
Funding 1, Funding 2 or the Security Trustee, as the case may be
(including in relation to the appointment of a substitute cash
manager), provided that the Mortgages Trustee or the Security
Trustee, as the case may be, shall not be required to take or
direct to be taken such further action unless it has been
indemnified to its satisfaction (and in the event of a conflict
between the directors of Funding 1, Funding 2, the Mortgages
Trustee and the Security Trustee, the director of the Security
Trustee shall prevail);
(iii) provide all relevant information contained on computer records
in the form of magnetic tape, together with details of the
layout of the files encoded on such magnetic tapes; and
(iv) co-operate and consult with and assist the Mortgages Trustee,
Funding 1, Funding 2 or the Security Trustee or its nominee, as
the case may be (which shall, for the avoidance of doubt,
include any Receiver appointed by it), for the purposes of
explaining the file layouts and the format of the magnetic tapes
generally containing such computer records on the computer
system of the Mortgages Trustee, Funding 1, Funding 2 or the
Security Trustee or such nominee, as the case may be.
13.4 NOTICE OF EVENT OF DEFAULT
The Cash Manager shall deliver to the Mortgages Trustee, Funding 1,
Funding 2 and the Security Trustee as soon as reasonably practicable but
in any event within three London Business Days of becoming aware thereof
a notice of any Cash Manager Termination Event or any event which with
the giving of notice or expiry of any grace period or certification, as
specified in such Cash Manager Termination Event would constitute the
same or any Intercompany Loan Event of Default or Master Intercompany
Loan Event of Default or any Potential Intercompany Loan Event of
Default or Potential Master Intercompany Loan Event of Default.
13.5 GENERAL PROVISIONS RELATING TO TERMINATION
(a) Termination of this Agreement or the appointment of the Cash
Manager under this Agreement shall be without prejudice to the
liabilities of the Mortgages Trustee, Funding 1, Funding 2 and
the Security Trustee to the Cash Manager or vice versa incurred
before the date of such termination. The Cash Manager shall have
no right of set-off or any lien in respect of such amounts
against amounts held by it on behalf of the Mortgages Trustee,
Funding 1, Funding 2 or the Security Trustee.
(b) This Agreement shall terminate automatically at such time as
Funding 1 and Funding 2 have no further interest in the Trust
Property and the Intercompany Loans and the Master Intercompany
Loan have been fully repaid or Funding 1's obligations under the
Intercompany Loans and Funding 2's obligations under the Master
Intercompany Loan Agreement have been otherwise discharged.
(c) On termination of the appointment of the Cash Manager under the
provisions of this Clause 13, the Cash Manager shall be entitled
to receive all fees and other monies accrued up to (but
excluding) the date of termination but shall not be entitled to
any other or further compensation. Such monies so receivable by
the Cash Manager shall be paid by the
16
Mortgages Trustee, on the dates on which they would otherwise
have fallen due hereunder and under the terms of the Funding 1
Deed of Charge. For the avoidance of doubt, such termination
shall not affect the Cash Manager's rights to receive payment of
all amounts (if any) due to it from the Mortgages Trustee,
Funding 1 or Funding 2 other than under this Agreement.
(d) Any provision of this Agreement which is stated to continue
after termination of the Agreement shall remain in full force
and effect notwithstanding termination.
14. FURTHER ASSURANCE
14.1 CO-OPERATION, ETC.
The parties hereto agree that they will co-operate fully to do all such
further acts and things and execute any further documents as may be
necessary or desirable to give full effect to the arrangements
contemplated by this Agreement.
14.2 POWERS OF ATTORNEY
Without prejudice to the generality of Clause 14.1, the Mortgages
Trustee, Funding 1, Funding 2 and the Security Trustee shall upon
request by the Cash Manager forthwith give to the Cash Manager such
further powers of attorney or other written authorisations, mandates or
instruments as are necessary to enable the Cash Manager to perform the
Cash Management Services.
14.3 CHANGE OF SECURITY TRUSTEE
In the event that there is any change in the identity of the Security
Trustee or an additional Security Trustee is appointed in accordance
with the Funding 1 Deed of Charge or the Funding 2 Deed of Charge, as
the case may be, the Cash Manager shall execute such documents with any
other parties to this Agreement and take such actions as such new
Security Trustee may reasonably require for the purposes of vesting in
such new Security Trustee the rights of the Security Trustee under this
Agreement and under the Funding 1 Deed of Charge and the Funding 2 Deed
of Charge, as the case may be, and releasing the retiring Security
Trustee from further obligations thereunder and while any of the Notes
of any Funding 1 Issuer or the Master Issuer, as the case may be,
remains outstanding shall give notice thereof to the Rating Agencies.
14.4 NO OBLIGATION ON SECURITY TRUSTEE
Nothing herein contained shall impose any obligation or liability on the
Security Trustee to assume or perform any of the obligations of the
Mortgages Trustee, Funding 1, Funding 2 or the Cash Manager hereunder or
render it liable for any breach thereof.
15. MISCELLANEOUS
15.1 NO SET-OFF
Each of the Seller and the Cash Manager agrees that it will not:
(a) set off or purport to set off any amount which any of the
Mortgages Trustee, Funding 1 or Funding 2 is or will become
obliged to pay to it under this Agreement against any amount
from time to time standing to the credit of or to be credited to
the Mortgages Trustee GIC Account, any Funding 1 Bank Account or
any Funding 2 Bank Account or any replacement or additional bank
account of any of the Mortgages Trustee, Funding 1 or Funding 2;
or
17
(b) make or exercise any claims or demands, any rights of
counterclaim or any other equities against or withhold payment
of any and all sums of money which may at any time and from time
to time be standing to the credit of the Mortgages Trustee GIC
Account, any Funding 1 Bank Account or any Funding 2 Bank
Account or any replacement of additional bank accounts of any of
the Mortgages Trustee, Funding 1 or Funding 2.
15.2 NO PETITION
The Cash Manager agrees that for so long as any Notes of any Funding 1
Issuer or the Master Issuer are outstanding it will not petition or
commence proceedings for the administration (including, for the
avoidance of doubt, the filing of documents with the court or the
service of a notice of intention to appoint an administrator) or winding
up of the Mortgages Trustee, Funding 1, Funding 2 or any Funding 1
Issuer or the Master Issuer or participate in any ex parte proceedings
with regard thereto.
15.3 NO RECOURSE
(a) In relation to all sums due and payable by the Mortgages
Trustee, Funding 1 or Funding 2 to the Cash Manager, the Cash
Manager agrees that it shall have recourse only to sums paid to
or received by (or on behalf of) the Mortgages Trustee, Funding
1 and Funding 2 pursuant to the provisions of the Transaction
Documents.
(b) For the avoidance of doubt, the Security Trustee shall not be
liable to pay any amounts due under Clauses 7 and 8, and without
prejudice to the obligations of the Mortgages Trustee, Funding 1
or Funding 2, as the case may be, or any receiver appointed
pursuant to the Funding 1 Deed of Charge or the Funding 2 Deed
of Charge, as the case may be, in respect of such amounts.
(c) Notwithstanding any other provisions of this Agreement, all
obligations to, and rights of, the Security Trustee under or in
connection with this Agreement (other than its obligations under
Clause 14) shall automatically terminate upon the discharge in
full of the Funding 1 Secured Obligations and the Funding 2
Secured Obligations, PROVIDED THAT this shall be without
prejudice to any claims in respect of such obligations and
rights arising on or prior to such date.
16. CONFIDENTIALITY
During the continuance of this Agreement or after its termination, each
of the Mortgages Trustee, the Cash Manager, the Seller, Funding 1,
Funding 2 and the Security Trustee shall use its best endeavours not to
disclose to any person, firm or company whatsoever any information
relating to the business, finances or other matters of a confidential
nature of any other party hereto of which it may exclusively by virtue
of being party to the Transaction Documents have become possessed and
shall use all reasonable endeavours to prevent any such disclosure as
aforesaid, PROVIDED HOWEVER that the provisions of this Clause 16 shall
not apply:
(a) to any information already known to the recipient otherwise than
as a result of entering into any of the Transaction Documents;
(b) to any information subsequently received by the recipient which
it would otherwise be free to disclose;
(c) to any information which is or becomes public knowledge
otherwise than as a result of the conduct of the recipient;
18
(d) to any extent that the recipient is required to disclose the
same pursuant to any law or order of any court of competent
jurisdiction or pursuant to any direction, request or
requirement (whether or not having the force of law) of any
central bank or any governmental or other authority (including,
without limitation, any official bank examiners or regulators);
(e) to the extent that the recipient needs to disclose the same for
determining the existence of, or declaring, a Note Event of
Default, an Intercompany Loan Event of Default, a Master
Intercompany Loan Event of Default or a Cash Manager Termination
Event, the protection or enforcement of any of its rights under
any of the Transaction Documents or in connection herewith or
therewith or for the purpose of discharging, in such manner as
it thinks fit, its duties under or in connection with such
agreements in each case to such persons as require to be
informed of such information for such purposes; or
(f) in relation to any information disclosed to the professional
advisers of the recipient or (in connection with a prospective
rating of any debt issued or to be issued by an Funding 1
Issuer, any New Issuer or the Master Issuer) to any Rating
Agency or any prospective new cash manager or prospective new
security trustee.
17. NOTICES
Any notices to be given pursuant to this Agreement to any of the parties
hereto shall be sufficiently served if sent by prepaid first class post,
by hand or facsimile transmission and shall be deemed to be given (in
the case of facsimile transmission) when despatched, (where delivered by
hand) on the day of delivery if delivered before 17.00 hours on a London
Business Day or on the next London Business Day if delivered thereafter
or on a day which is not a London Business Day or (in the case of first
class post) when it would be received in the ordinary course of the post
and shall be sent:
(a) in the case of the Cash Manager, to Halifax plc, Xxxxxxx Xxxx,
Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (LP/3/3/SEC) (facsimile number
x00 (0) 000 000 0000) for the attention of the Head of Mortgage
Securitisation with a copy to HBOS Treasury Services plc, 00 Xxx
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number +44 (0) 20 7574
8303) for the attention of Head of Mortgage Securitisation and
Covered Bonds;
(b) in the case of the Mortgages Trustee, to Permanent Mortgages
Trustee Limited, Esplanade, St Helier, Jersey JE1 OBD, Channel
Islands (facsimile number x00 (0) 0000 000000) for the attention
of the Secretary with a copy to HBOS Treasury Services plc, 00
Xxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number +44 (0) 20
7574 8303) for the attention of Head of Mortgage and
Securitisation and Covered Bonds;
(c) in the case of the Seller, to Halifax plc, Xxxxxxx Xxxx
(XX/0/0/XXX), Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (facsimile number
x00 (0) 000 000 0000) for the attention of the Head of Mortgage
Securitisation with a copy to HBOS Treasury Services plc, 00 Xxx
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile number +44 (0) 20 7574
8303) for the attention of Head of Mortgage Securitisation and
Covered Bonds;
(d) in the case of Funding 1, to Permanent Funding (No. 1) Limited,
00 Xxxxx Xx. Xxxxx'x, Xxxxxx XX0X 0XX (facsimile number +44
(000) 0000 0000) for the attention of the Secretary with a copy
to HBOS Treasury Services plc, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X
0XX (facsimile number x00 (000) 0000 0000) for the attention of
Head of Mortgage Securitisation and Covered Bonds;
(e) in the case of Funding 2, to Permanent Funding (No. 2) Limited,
00 Xxxxx Xx. Xxxxx'x, Xxxxxx XX0X 0XX (facsimile number +44
(000) 0000 0000) for the attention of the Secretary with a copy
to HBOS Treasury Services plc, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X
00
0XX (facsimile number x00 (000) 0000 0000) for the attention of
Head of Mortgage Securitisation and Covered Bonds; and
(f) in the case of the Security Trustee, to The Bank of Xxx Xxxx,
Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile number +44 (0) 20
7964 6061/6399) for the attention of Global Structured Finance -
Corporate Trust,
or to such other address or facsimile number or for the attention of
such other person or entity as may from time to time be notified by any
party to the others by written notice in accordance with the provisions
of this Clause 17.
18. VARIATION AND WAIVER
No variation or waiver of this Agreement shall be effective unless it is
in writing and signed by (or by some person duly authorised by) each of
the parties. No single or partial exercise of, or failure or delay in
exercising, any right under this Agreement shall constitute a waiver or
preclude any other or further exercise of that or any other right.
19. NO PARTNERSHIP
It is hereby acknowledged and agreed by the parties that nothing in this
Agreement shall be construed as giving rise to any partnership between
any of the parties.
20. ASSIGNMENT
20.1 ASSIGNMENT BY THE MORTGAGES TRUSTEE, FUNDING 1 AND FUNDING 2
None of the Mortgages Trustee, Funding 1 nor Funding 2 may assign or
transfer any of its respective rights and obligations under this
Agreement without the prior written consent of:
(a) in the case of the Mortgages Trustee, each of the Beneficiaries
and the Security Trustee;
(b) in the case of Funding 1, each of the Security Trustee and the
Cash Manager; and
(c) in the case of Funding 2, each of the Security Trustee and the
Cash Manager,
except that Funding 1 may assign its respective rights hereunder without
such consent pursuant to the Funding 1 Deed of Charge and Funding 2 may
assign its respective rights hereunder without such consent pursuant to
the Funding 2 Deed of Charge.
20.2 NO ASSIGNMENT BY CASH MANAGER
The Cash Manager may not assign or transfer any of its rights and
obligations under this Agreement without the prior written consent of
the Mortgages Trustee, each of the Beneficiaries and the Security
Trustee.
21. AMENDMENTS
Subject to clause 25 of the Funding 1 Deed of Charge (Supplemental
Provisions Regarding the Security Trustee) and clause 24 of the Funding
2 Deed of Charge (Supplemental Provisions Regarding the Security
Trustee), any amendments to this Agreement will be made only with the
prior written consent of each party to this Agreement.
20
22. EXCLUSION OF THIRD PARTY RIGHTS
The parties to this Agreement do not intend that any term of this
Agreement should be enforced, by virtue of the Contracts (Rights of
Third Parties) Xxx 0000, by any person who is not a party to this
Agreement.
23. COUNTERPARTS
This Agreement may be executed in any number of counterparts (manually
or by facsimile) each of which, when executed and delivered, shall
constitute an original, but all the counterparts shall together
constitute but one and the same instrument provided, however, that this
Agreement shall have no force or effect until it is executed by the last
party to execute the same and shall be deemed to have been executed and
delivered in the place where such last party executed this Agreement.
24. SEVERABILITY
Where any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations
under this Agreement, or of such provision or obligation in any other
jurisdiction, shall not be affected or impaired thereby.
25. GOVERNING LAW AND SUBMISSION TO JURISDICTION
25.1 This Agreement is governed by, and shall be construed in accordance
with, the laws of England.
25.2 Each party to this Agreement hereby irrevocably submits to the
non-exclusive jurisdiction of the English courts in any action or
proceeding arising out of or relating to this Agreement, and hereby
irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined by such courts. Each party to
this Agreement hereby irrevocably waives, to the fullest extent it may
possibly do so, any defence or claim that the English courts are an
inconvenient forum for the maintenance or hearing of such action or
proceeding. The Mortgages Trustee irrevocably appoints Structured
Finance Management Limited at Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx
XX0X 0XX as its agent for the service of process.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed the
day and year first before written.
21
SCHEDULE 1
THE CASH MANAGEMENT SERVICES
The Cash Manager shall:
(a) make the determinations set out in Schedule 2 hereto;
(b) operate the Mortgages Trustee GIC Account, the Funding 1 GIC Account,
the Funding 1 Transaction Account, the Funding 2 GIC Account, the
Funding 2 Transaction Account or any other Bank Account and ensure that
payments are made into and from such accounts in accordance with this
Agreement, the Mortgages Trust Deed, the Funding 1 Deed of Charge, the
Funding 2 Deed of Charge, the Bank Account Agreement, the Mortgages
Trustee Guaranteed Investment Contract, the Funding 1 Guaranteed
Investment Contract, the Funding 2 Guaranteed Investment Contract and
any other applicable Transaction Document PROVIDED HOWEVER THAT nothing
herein shall require the Cash Manager to make funds available to the
Mortgages Trustee, Funding 1 or Funding 2 to enable such payments to be
made other than as expressly required by the provisions of this
Agreement;
(c) keep records for all taxation purposes (including, without limitation
VAT);
(d) assist the auditors of the Mortgages Trustee, Funding 1 and Funding 2
and provide such information to them as they may reasonably request for
the purpose of carrying out their duties as auditors;
(e) make all filings, give all notices and make all registrations and other
notifications required in the day-to-day operation of the respective
businesses of the Mortgages Trustee, Funding 1 and Funding 2 or required
to be given by the Mortgages Trustee, Funding 1 or Funding 2 pursuant to
the Transaction Documents;
(f) arrange for all payments due to be made by the Mortgages Trustee and/or
Funding 1 and/or Funding 2 under any of the Transaction Documents,
PROVIDED THAT such monies are at the relevant time available to the
Mortgages Trustee and/or Funding 1 and/or Funding 2 and PROVIDED FURTHER
that nothing herein shall constitute a guarantee by the Cash Manager of
all or any of the obligations of the Mortgages Trustee, Funding 1 or
Funding 2 under any of the Transaction Documents;
(g) without prejudice to the role of and in conjunction with the relevant
Corporate Services Provider under the relevant Corporate Services
Agreement, keep general books of account and records of the Mortgages
Trustee, Funding 1 and Funding 2; provide accounting services, including
reviewing receipts and payments, supervising and assisting in the
preparation of interim statements and final accounts and supervising and
assisting in the preparation of Tax returns;
(h) without prejudice to the role of and in conjunction with the relevant
Corporate Services Provider under the relevant Corporate Services
Agreement, provide or procure the provision of company secretarial and
administration services to the Mortgages Trustee, Funding 1 and Funding
2 including the keeping of all registers and the making of all returns
and filings required by applicable law or by US or UK regulatory
authorities (including the Securities and Exchange Commission),
co-operate in the convening of board and general meetings and provide
registered office facilities;
(i) itself on behalf of the Mortgages Trustee, Funding 1 and Funding 2,
PROVIDED THAT such monies are at the relevant time available to the
Mortgages Trustee, Funding 1 and Funding 2, pay all the out-of-pocket
expenses of the Mortgages Trustee, Funding 1 and Funding 2, incurred by
the Cash
22
Manager on behalf of the Mortgages Trustee, Funding 1 and Funding 2, as
the case may be, in the performance of the Cash Manager's duties
hereunder including without limitation:
(i) all Taxes which may be due or payable by the Mortgages Trustee,
Funding 1 and Funding 2;
(ii) all registration, transfer, filing and other fees and other
charges payable in respect of the sale by the Seller of the
Portfolio to the Mortgages Trustee;
(iii) all fees payable to the London Stock Exchange plc;
(iv) all necessary filing and other fees in compliance with
regulatory requirements;
(v) all legal and audit fees and other professional advisory fees;
(vi) all communication expenses including postage, courier and
telephone charges; and
(vii) all premiums payable by the Mortgages Trustee in respect of the
Insurance Policies;
(j) at the request of Funding 1 or Funding 2, as the case may be (but also
with the prior written consent of the Security Trustee), invest monies
standing from time to time to the credit of the Funding 1 GIC Account
and the Funding 1 Liquidity Stand-by Account (if any) or the Funding 2
GIC Account and the Funding 2 Liquidity Stand-by Account (if any), as
the case may be, in Authorised Investments, subject to the following
provisions:
(i) any such Authorised Investment shall be made in the joint names
of the Security Trustee and Funding 1 or Funding 2, as the case
may be;
(ii) any costs properly and reasonably incurred in making and
changing Authorised Investments will be reimbursed to the Cash
Manager and the Security Trustee by Funding 1 or Funding 2, as
the case may be;
(iii) all income or other distributions arising on, or proceeds
following the disposal or maturity of, Authorised Investments
shall be credited to the Funding 1 GIC Account or the Funding 2
GIC Account, as the case may be; and
(iv) the Security Trustee and the Cash Manager shall not be
responsible (save where any loss results from the Security
Trustee's or the Cash Manager's, as the case may be, own fraud,
wilful default or negligence or that of their respective
officers or employees) for any loss occasioned by reason of any
such Authorised Investments whether by depreciation in value or
otherwise provided that such Authorised Investments were made in
accordance with the above provisions.
23
SCHEDULE 2
CASH MANAGEMENT AND MAINTENANCE OF LEDGERS
1. DETERMINATION
(a) On each Calculation Date based on the amount of monies standing to the
credit of the Mortgages Trustee GIC Account as at close of business on
the London Business Day immediately preceding the relevant Calculation
Date, the Cash Manager shall determine each of the following:
(i) the amount of Principal Receipts and Revenue Receipts received
during the preceding Calculation Period; and
(ii) the amount of Mortgages Trust Available Revenue Receipts and
Mortgages Trust Available Principal Receipts to be distributed
to Funding 1, Funding 2 and to the Seller on the Distribution
Date immediately following the relevant Calculation Date.
(b) On each Calculation Date, the Cash Manager shall determine each of the
following:
(i) the amount of any Losses incurred on the Loans in the period
from the immediately preceding Calculation Date to the relevant
Calculation Date;
(ii) the Funding 1 Share, the Seller Share, the Funding 2 Share, the
Funding 1 Share Percentage, the Funding 2 Share Percentage and
the Seller Share Percentage in accordance with clause 8 of the
Mortgages Trust Deed; and
(iii) the Minimum Seller Share in accordance with clause 9.2 of the
Mortgages Trust Deed.
(c) Four Business Days prior to each Funding 1 Interest Payment Date the
Cash Manager shall determine each of the following:
(i) the amount of any Funding 1 Available Revenue Receipts to be
applied on the following Funding 1 Interest Payment Date in
accordance with the Funding 1 Pre-Enforcement Revenue Priority
of Payments;
(ii) the amount of any Funding 1 Available Principal Receipts to be
applied on the following Funding 1 Interest Payment Date in
accordance with the Funding 1 Principal Priority of Payments;
and
(iii) the amount of any Funding 1 Income Deficit.
(d) Four Business Days prior to each Funding 2 Interest Payment Date the
Cash Manager shall determine each of the following:
(i) the amount of any Funding 2 Available Revenue Receipts to be
applied on the following Funding 2 Interest Payment Date in
accordance with the Funding 2 Pre-Enforcement Revenue Priority
of Payments;
(ii) the amount of any Funding 2 Available Principal Receipts to be
applied on the following Funding 2 Interest Payment Date in
accordance with the Funding 2 Principal Priority of Payments;
(iii) whether each of the Repayment Tests is satisfied; and
24
(iv) the amount of any Funding 2 Income Deficit.
(e) The Cash Manager shall make all the determinations referred to in
paragraphs 1(a) to (d) above on the basis of the following assumptions:
(i) that the amount of any Losses will not increase;
(ii) that any debit balance on the Funding 1 Principal Deficiency
Ledger or the Funding 2 Principal Deficiency Ledger, as the case
may be, will not increase; and
(iii) such other assumptions (including without limitation as to the
amount of any payments or provisions to be made in accordance
with the applicable Funding 1 Priority of Payments or the
Funding 2 Priority of Payments, as the case may be) as the Cash
Manager considers appropriate.
The Cash Manager shall on request notify the Mortgages Trustee, Funding
1, Funding 2 and the Security Trustee in writing of any such other
assumptions and shall take account of any representations made by the
Mortgages Trustee, Funding 1, Funding 2 and the Security Trustee (as the
case may be) in relation thereto.
(f) The Cash Manager shall, if necessary, perform all currency conversions
free of charge, cost or expense at the relevant exchange rate (for the
purposes of any calculations referred to above, (i) all percentages
resulting from such calculations will be rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point (e.g. 9.876541%
being rounded down to 9.87654%) and (ii) any currency amounts used in or
resulting from such calculations will be rounded in accordance with the
relevant market practice).
(g) Each determination made in accordance with this paragraph 1 shall (in
the absence of bad faith, wilful default, negligence and manifest error)
be final and binding on all persons.
2. NOTIFICATION OF DETERMINATIONS
(a) The Cash Manager will cause each determination of Principal Receipts,
Revenue Receipts, Losses, Mortgages Trust Available Revenue Receipts,
Mortgages Trust Available Principal Receipts, the Funding 1 Share, the
Funding 2 Share, the Seller Share, the Funding 1 Share Percentage, the
Funding 2 Share Percentage, the Seller Share Percentage and the Minimum
Seller Share to be notified forthwith in writing to the Mortgages
Trustee, the Beneficiaries and the Security Trustee.
(b) The Cash Manager will cause each determination of the Funding 1 Income
Deficit (if any), the Funding 2 Income Deficit (if any), the Funding 1
Liquidity Shortfall (if any), the Funding 2 Liquidity Shortfall (if
any), the Funding 1 Available Revenue Receipts, the Funding 1 Available
Principal Receipts, the Funding 2 Available Revenue Receipts and the
Funding 2 Available Principal Receipts to be notified forthwith in
writing to Funding 1 (in the case of Funding 1) and Funding 2 (in the
case of Funding 2) and the Security Trustee.
3. PRIORITY OF PAYMENTS FOR MORTGAGES TRUST AVAILABLE REVENUE RECEIPTS
The Cash Manager shall (unless the intended recipient of the relevant
payment agrees otherwise) on each Distribution Date withdraw Cash from
the Mortgages Trustee GIC Account and/or, in the case of sums to be
provided for, retain Cash in the amounts required (to the extent that
such withdrawal does not cause the Mortgages Trustee GIC Account to
become overdrawn or, if any amounts are retained by way of provision for
the relevant liability and are thus not withdrawn, to the extent that
withdrawal of those amounts that are withdrawn would not, if such
retained amounts were also to be withdrawn, cause the balance on the
Mortgages Trustee GIC Account to become overdrawn) in an
25
aggregate amount equal the Mortgages Trust Available Revenue Receipts on
each Distribution Date. The withdrawal shall be used to make the
payments and provisions in the order of priority set out in clause 10.2
of the Mortgages Trust Deed (in each case only if and to the extent that
payments or provisions of a higher priority have been made in full).
4. PRIORITY OF PAYMENTS FOR MORTGAGES TRUST AVAILABLE PRINCIPAL RECEIPTS
The Cash Manager shall (unless the intended recipient of the relevant
payment agrees otherwise) on each Distribution Date, withdraw Cash from
the Mortgages Trustee GIC Account (to the extent only that such
withdrawal does not cause the Mortgages Trustee GIC Account to become
overdrawn) in an aggregate amount equal to the Mortgages Trust Available
Principal Receipts on each Distribution Date to make the payments in the
order of priority set out in clause 11 of the Mortgages Trust Deed.
5. PRIORITY OF PAYMENTS FOR FUNDING 1 AVAILABLE REVENUE RECEIPTS
Funding 1 Available Revenue Receipts will be applied by the Cash Manager
on each Funding 1 Interest Payment Date until enforcement of the Funding
1 Security pursuant to the Funding 1 Deed of Charge or until such time
as there are no amounts outstanding under any Intercompany Loan
Agreement, in making such payments and provisions in the order of
priority set out in the Funding 1 Pre-Enforcement Revenue Priority of
Payments (in each case only if and to the extent that payments or
provisions of a higher priority have been made in full) as set out in
Part 1 of Schedule 3 to the Funding 1 Deed of Charge (as the same may be
amended, varied or restated from time to time).
6. PRIORITY OF PAYMENTS FOR FUNDING 1 AVAILABLE PRINCIPAL RECEIPTS
Funding 1 Available Principal Receipts will be applied by the Cash
Manager on each Funding 1 Interest Payment Date until enforcement of the
Funding 1 Security pursuant to the Funding 1 Deed of Charge or until
such time as there are no amounts outstanding under any Intercompany
Loan Agreement, in making such payments and provisions in the order of
priority (in each case only if and to the extent that payments or
provisions of a higher priority have been made in full) set out in Part
2 of Schedule 3 to the Funding 1 Deed of Charge.
7. FUNDING 1 INCOME DEFICIT/FUNDING 1 LIQUIDITY FACILITY
(a) If the Cash Manager determines four Business Days prior to a Funding 1
Interest Payment Date that there will be a Funding 1 Income Deficit,
then the Cash Manager, on behalf of Funding 1, shall pay or provide for
such Funding 1 Income Deficit by applying Funding 1 Principal Receipts
(plus any part of the balance of the Funding 1 Cash Accumulation Ledger
which is not comprised in Funding 1 Available Principal Receipts) to
make good such Funding 1 Income Deficit, and the Cash Manager shall make
a corresponding entry in the relevant Funding 1 Ledgers as described in
paragraphs 14 and 19 below.
(b) If the Cash Manager determines there are no (or insufficient) amounts
standing to the credit of the Funding 1 Principal Ledger and the Cash
Accumulation Ledger to cure the Funding 1 Income Deficit then on the
London Business Day immediately preceding a Funding 1 Interest Payment
Date the Cash Manager will, subject to paragraph (c) below, (i) direct
Funding 1 to request a drawing pursuant to CLAUSE 5.1 of the Funding 1
Liquidity Facility Agreement to apply towards such Funding 1 Income
Deficit.
(c) A Funding 1 Liquidity Drawing may not be used to pay interest or
principal (as applicable) on the Term Advances if and to the extent that
there are funds standing to the credit of the Funding 1
Liquidity Reserve Fund that are available to cure such Funding 1 Income
Deficit on such Funding 1 Interest Payment Date.
26
8. PRIORITY OF PAYMENTS FOR FUNDING 2 AVAILABLE REVENUE RECEIPTS
Funding 2 Available Revenue Receipts will be applied by the Cash Manager
on each Funding 2 Interest Payment Date until enforcement of the Funding
2 Security pursuant to the Funding 2 Deed of Charge or until such time
as there are no amounts outstanding under the Master Intercompany Loan
Agreement, in making such payments and provisions in the order of
priority set out in the Funding 2 Pre-Enforcement Revenue Priority of
Payments (in each case only if and to the extent that payments or
provisions of a higher priority have been made in full) as set out in
[Part 1 of Schedule 3] to the Funding 2 Deed of Charge (as the same may
be amended, varied or restated from time to time).
9. PRIORITY OF PAYMENTS FOR FUNDING 2 AVAILABLE PRINCIPAL RECEIPTS
Funding 2 Available Principal Receipts will be applied by the Cash
Manager on each Funding 2 Interest Payment Date until enforcement of the
Funding 2 Security pursuant to the Funding 2 Deed of Charge or until
such time as there are no amounts outstanding under the Master
Intercompany Loan Agreement, in making such payments and provisions in
the order of priority (in each case only if and to the extent that
payments or provisions of a higher priority have been made in full) set
out in Part 2 of Schedule 3 to the Funding 2 Deed of Charge.
10. FUNDING 2 INCOME DEFICIT
If the Cash Manager determines four Business Days prior to a Funding 2
Interest Payment Date that there will be a Funding 2 Income Deficit,
then the Cash Manager, on behalf of Funding 2, shall pay or provide for
such Funding 2 Income Deficit by applying Funding 2 Principal Receipts
(plus any part of the balance of the Funding 2 Cash Accumulation Ledger
which is not comprised in Funding 2 Available Principal Receipts) to
make good such Funding 2 Income Deficit, and the Cash Manager shall make
a corresponding entry in the relevant Funding 2 Ledgers as described in
paragraphs 14 and 26 below.
11. OTHER PAYMENTS
Each of the Beneficiaries and the Cash Manager agrees, and the Mortgages
Trustee concurs, that (save as otherwise specified below) the following
payments may be made from the Mortgages Trustee GIC Account (to the
extent that withdrawal of those amounts would not cause the balance of
the Mortgages Trustee GIC Account to become overdrawn) on any date:
(i) if any amount has been received from a Borrower for the express
purpose of payment being made to a third party for the provision
of a service (including giving insurance cover) to either that
Borrower or the Seller or the Mortgages Trustee, to pay such
amount when due to such third party or, in the case of the
payment of an insurance premium, where such third party and the
Cash Manager have agreed that payment of commission should be
made by deduction from such insurance premium, to pay such
amount less such commissions when due to such third party and to
pay such commission to the Cash Manager and to pay any premiums
in respect of any Insurance Policy or other insurance policy
relating to any Loan comprised in the Portfolio;
(ii) to pay to any person (including the Cash Manager) any amounts
due arising from any overpayment by any person or arising from
any reimbursement by any person of any such
overpayment (including, for the avoidance of doubt, where
arising from the failure of a direct debit);
(iii) to pay when due (but subject to any right to refuse or withhold
payment or of set-off that has arisen by reason of the
Borrower's breach of the terms of the relevant Mortgage or Loan)
any
27
amount payable to a Borrower under the terms of the Mortgage or
the Loan to which that Borrower is a party, and to pay when due
any amount payable by the Mortgages Trustee to the Seller
pursuant to clauses 3.3, 4.4 and 5.2 of the Mortgage Sale
Agreement;
(iv) to pay to the Seller any amounts (including, for the avoidance
of doubt, any Early Repayment Fees) received and held by the
Mortgages Trustee on trust for the Seller pursuant to clause 5
of the Mortgage Sale Agreement;
(v) to pay when due and payable any amounts due and payable by the
Mortgages Trustee to third parties and incurred without breach
by the Mortgages Trustee of the Mortgages Trust Deed and not
provided for payment elsewhere in this paragraph 8;
(vi) to refund any amounts due arising from the rejection of any
payments in respect of a Loan and any other amounts which have
not been received by the Mortgages Trustee as cleared funds; and
(vii) to refund to the Seller any amounts which represent amounts
received from Borrowers but which do not form part of the
Mortgage Account balance or comprise unpaid interest as at the
relevant date and which are amounts owed by such Borrowers in
respect of the period prior to the date on which the Mortgage
Loan (together with its Related Security) relating to such
Mortgage Account was transferred to the Mortgages Trustee as and
when identified by the Cash Manager and if a Borrower fails to
pay the full amount that it owes, the Cash Manager shall be
obliged to refund to the Seller only such portion of the amount
which relates to any period prior to such transfer.
12. USE OF LEDGERS
The Cash Manager shall forthwith record monies received or payments made
by it on behalf of the Mortgages Trustee, Funding 1 or Funding 2 in the
ledgers in the manner set out in this Agreement. If, at any time, the
Cash Manager is in any doubt as to which ledger a particular amount
should be credited or debited, it shall consult with the Security
Trustee thereon.
Except in the case of the Funding 1 Principal Deficiency Ledger or the
Funding 2 Principal Deficiency Ledger, a debit item shall only be made
in respect of any of the Mortgages Trustee Ledgers, the Funding 1
Ledgers and the Funding 2 Ledgers and the corresponding payment or
transfer (if any) may only be made from the Mortgages Trustee GIC
Account, the Funding 1 GIC Account, the Funding 1 Transaction Account,
the Funding 2 GIC Account or the Funding 2 Transaction Account, as the
case may be, to the extent that such entry does not cause the relevant
ledger to have a debit balance. In the case of the Funding 1 Principal
Deficiency Ledger, each Funding 1 Principal Deficiency Sub-Ledger, the
Funding 2 Principal Deficiency Ledger and each Funding 2 Principal
Deficiency Sub-Ledger, a credit item shall only be made to the extent
that such entry does not cause such ledger to have a credit balance.
13. REVENUE LEDGER
The Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Revenue Ledger:
(i) all Revenue Receipts; and
(ii) all interest received by the Mortgages Trustee on the
Mortgages Trustee GIC Account; and
28
(b) any payment or provision made under paragraph 3 above shall be
debited to the Revenue Ledger.
14. PRINCIPAL LEDGER
The Cash Manager shall ensure that:
(a) all Principal Receipts shall be credited to the Principal
Ledger; and
(b) any payment or provision made under paragraph 4 above shall be
debited to the Principal Ledger.
15. LOSSES LEDGER
The Cash Manager shall ensure that all Losses shall be recorded in the
Losses Ledger.
16. FUNDING 1 SHARE/FUNDING 2 SHARE/SELLER SHARE LEDGER
The Cash Manager shall ensure that the Current Funding 1 Share and the
Current Funding 1 Share Percentage of the Trust Property, the Current
Funding 2 Share and the Current Funding 2 Share Percentage of the Trust
Property and the Current Seller Share and the Current Seller Share
Percentage of the Trust Property are recorded in the Funding 1
Share/Funding 2 Share/Seller Share Ledger on the Initial Closing Date
(in the case of Funding 1 and the Seller), on the Funding 2 Programme
Date and thereafter on each Distribution Date.
17. FUNDING 1 REVENUE LEDGER
The Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Funding 1 Revenue
Ledger:
(i) all Funding 1 Revenue Receipts;
(ii) all interest received by Funding 1 in respect of the
Funding 1 Bank Accounts;
(iii) all amounts received by Funding 1 representing income on
any Funding 1 Authorised Investments;
(iv) all amounts (other than any early termination payment
which is to be used to acquire, if necessary, a new
swap) received by Funding 1 under the Funding 1 Swap
Agreement; and
(v) any amount debited to the Funding 1 Principal Ledger
under paragraph 19(b)(ii) below; and
(b) any payment or provision made under paragraph 5 above shall be
debited to the Funding 1 Revenue Ledger.
18. FUNDING 1 LIQUIDITY FACILITY LEDGER
The Cash Manager shall ensure that:
(a) all Funding 1 Liquidity Facility Drawings shall be credited to
the Funding 1 Liquidity Facility Ledger; and
(b) all Funding 1 Liquidity Facility Repayments shall be noted on
the Funding 1 Liquidity Facility Ledger.
29
19. FUNDING 1 PRINCIPAL LEDGER
Without prejudice to paragraph 20 below, the Cash Manager shall ensure
that:
(a) the following amounts shall be credited to the Funding 1
Principal Ledger:
(i) all Funding 1 Principal Receipts; and
(ii) amounts credited to the Funding 1 Principal Deficiency
Ledger under paragraph 5 above and paragraph 20 below;
and
(b) the following amounts shall be debited to the Funding 1
Principal Ledger:
(i) the aggregate amount paid pursuant to paragraph 6 above
(other than any remainder to be credited to the Funding
1 Principal Ledger); and
(ii) on each Funding 1 Interest Payment Date, an amount equal
to the Funding 1 Income Deficit on such Funding 1
Interest Payment Date.
20. FUNDING 1 PRINCIPAL DEFICIENCY LEDGER
(a) Without prejudice to paragraph 5 above, the Cash Manager shall ensure
that there shall be debited to the Funding 1 Principal Deficiency
Ledger:
(i) deficiencies arising from Losses which have been allocated to
the Funding 1 Share; and
(ii) any amount required to be debited to the Funding 1 Principal
Ledger under paragraph 19(b)(ii) above.
(b) The Cash Manager shall ensure that there shall be credited to the
Funding 1 Principal Deficiency Ledger any amount to be credited in
accordance with paragraph 5 above.
(c) Amounts to be debited to the Funding 1 Principal Deficiency Ledger shall
be debited in the following order:
(i) first, to the Funding 1 Principal Deficiency Sub-Ledger
corresponding to the Term Advance with the lowest ranking Term
Advance Rating until the debit balance thereon is equal to the
then principal amount outstanding of the corresponding Term
Advance(s); and
(ii) secondly, to the Funding 1 Principal Deficiency Sub-Ledger
corresponding to the Term Advance with the next lowest Term
Advance Rating until the debit balance thereon is equal to the
then principal amount outstanding of corresponding Term
Advance(s), and so on until amounts are debited to the AAA
Principal Deficiency Sub Ledger, at which point there will be an
Asset Trigger Event.
Losses on the Loans and/or the application of Funding 1 Available
Principal Receipts to pay interest on the Term Advances will not be
recorded on the Funding 1 Principal Deficiency Ledger to the extent that
the Funding 1 Share of the Trust Property together with amounts standing
to the credit of the Funding 1 Cash Accumulation Ledger and the Funding
1 Principal Ledger, in aggregate, is greater than or equal to the
aggregate Outstanding Principal Balance of the Intercompany Loans on
30
the relevant Funding 1 Interest Payment Date, after taking account of
such Losses or the relevant application of Principal Receipts.
(d) Amounts to be credited to the Funding 1 Principal Deficiency Ledger
shall be credited in the following order:
(i) first, to the Funding 1 Principal Deficiency Sub-Ledger
corresponding to the Term Advance with the highest ranking Term
Advance Rating until the debit balance thereon is reduced to
zero;
(ii) secondly, to the Funding 1 Principal Deficiency Sub-Ledger
corresponding to the Term Advance with the next highest ranking
Term Advance Rating until the debit balance thereon is reduced
to zero; and
(iii) thirdly, to the Funding 1 Principal Deficiency Sub-Ledger
corresponding to the Term Advance with the next highest ranking
Term Advance Rating until the debit balance thereon is reduced
to zero,
and so on until the balance of the Funding 1 Principal Deficiency Ledger
is zero.
21. FUNDING 1 GENERAL RESERVE LEDGER
(a) A tranche (if any) drawn down on a relevant Closing Date by Funding 1
pursuant to a Start-Up Loan Agreement for the purposes of funding the
Funding 1 General Reserve Fund (or any other similar reserve fund) will
be credited to the Funding 1 General Reserve Ledger.
(b) Amounts shall be credited to the Funding 1 General Reserve Ledger in
accordance with the Funding 1 Priority of Payments above.
(c) Amounts shall be debited to the Funding 1 General Reserve Ledger on each
Funding 1 Interest Payment Date in order to be applied in accordance
with the order of priority of payments set out in Schedule 3 to the
Funding 1 Deed of Charge.
22. FUNDING 1 LIQUIDITY RESERVE LEDGER
(a) Amounts shall be credited to the Funding 1 Liquidity Reserve Ledger in
accordance with the Funding 1 Priority of Payments above.
(b) Amounts shall be debited to the Funding 1 Liquidity Reserve Ledger to
the extent permitted on each relevant Funding 1 Interest Payment Date in
order to be applied in accordance with the priority of payments set out
in Schedule 3 to the Funding 1 Deed of Charge.
23. INTERCOMPANY LOAN LEDGER
The Cash Manager shall ensure that all payments of interest and
repayments of principal on each of the Term Advances are recorded in the
Intercompany Loan Ledger.
24. FUNDING 1 CASH ACCUMULATION LEDGER
The Cash Manager shall ensure that all Funding 1 Principal Receipts
reserved by Funding 1 to pay the relevant Bullet Term Advances are
recorded on the Funding 1 Cash Accumulation Ledger.
25. FUNDING 2 REVENUE LEDGER
The Cash Manager shall ensure that:
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(a) the following amounts shall be credited to the Funding 2 Revenue
Ledger:
(i) all Funding 2 Revenue Receipts;
(ii) all interest received by Funding 2 in respect of the
Funding 2 Bank Accounts;
(iii) all amounts received by Funding 2 representing income on
any Funding 2 Authorised Investments;
(iv) all amounts (other than any early termination payment
which is to be used to acquire, if necessary, a new
swap) received by Funding 2 under the Funding 2 Swap
Agreement; and
(v) any amount debited to the Funding 2 Principal Ledger
under paragraph 26(b)(ii) below; and
(b) any payment or provision made under paragraph 8 above shall be
debited to the Funding 2 Revenue Ledger.
26. FUNDING 2 PRINCIPAL LEDGER
Without prejudice to paragraph 27 below, the Cash Manager shall ensure
that:
(a) the following amounts shall be credited to the Funding 2
Principal Ledger:
(i) all Funding 2 Principal Receipts; and
(ii) amounts credited to the Funding 2 Principal Deficiency
Ledger under paragraph 8 above and paragraph 27 below;
and
(b) the following amounts shall be debited to the Funding 2
Principal Ledger:
(i) the aggregate amount paid pursuant to paragraph 9 above
(other than any remainder to be credited to the Funding
2 Principal Ledger); and
(ii) on each Funding 2 Interest Payment Date, an amount equal
to the Funding 2 Income Deficit on such Funding 2
Interest Payment Date.
27. FUNDING 2 PRINCIPAL DEFICIENCY LEDGER
(a) Without prejudice to paragraph 8 above, the Cash Manager shall ensure
that there shall be debited to the Funding 2 Principal Deficiency
Ledger:
(i) deficiencies arising from Losses which have been allocated to
the Funding 2 Share; and
(ii) any amount required to be debited to the Funding 2 Principal
Ledger under paragraph 26(b)(ii) above.
(b) The Cash Manager shall ensure that there shall be credited to the
Funding 2 Principal Deficiency Ledger any amount to be credited in
accordance with paragraph 8 above.
(c) Amounts to be debited to the Funding 2 Principal Deficiency Ledger shall
be debited in the following order:
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(i) first, on the Funding 2 BB Principal Deficiency Sub-Ledger until
the balance of the Funding 2 BB Principal Deficiency Sub-Ledger
is equal to the aggregate principal amount outstanding of all BB
Loan Tranches;
(ii) second, on the Funding 2 BBB Principal Deficiency Sub-Ledger
until the balance of the Funding 2 BBB Principal Deficiency
Sub-Ledger is equal to the aggregate principal amount
outstanding of all BBB Loan Tranches;
(iii) third, on the Funding 2 A Principal Deficiency Sub-Ledger until
the balance of the Funding 2 A Principal Deficiency Sub-Ledger
is equal to the aggregate principal amount outstanding of all A
Loan Tranches;
(iv) fourth, on the Funding 2 AA Principal Deficiency Sub-Ledger
until the balance of the Funding 2 AA Principal Deficiency
Sub-Ledger is equal to the aggregate principal amount
outstanding of all AA Loan Tranches; and
(v) fifth, on the Funding 2 AAA Principal Deficiency Sub-Ledger, at
which point there will be an Asset Trigger Event (unless such
losses are recorded when (a) the aggregate principal amount
outstanding of all BB Loan Tranches, BBB Loan Tranches, A Loan
Tranches and AA Loan Tranches is equal to zero and (b) the sum
of (i) the amount standing to the credit of the Funding 2
General Reserve Ledger and (ii) the amount standing to the
credit of the Funding 2 Revenue Ledger together with amounts
determined and due to be credited to the Funding 2 Revenue
Ledger prior to the immediately following Funding 2 Interest
Payment Date after such debit is made, is greater than the
amount necessary to pay the items in paragraphs (A) to (E) in
the Funding 2 Pre-Enforcement Revenue Priority of Payments on
the immediately following Funding 2 Interest Payment Date after
such debit is made).
Losses on the Loans and/or the application of amounts standing to the
credit of the Funding 2 Principal Ledger to pay interest fees on the
Master Intercompany Loan will not be recorded on the Funding 2 Principal
Deficiency Ledger to the extent that the Funding 2 Share of the Trust
Property together with amounts standing to the credit of the Funding 2
Cash Accumulation Ledger and the Funding 2 Principal Ledger, in
aggregate, is greater than or equal to the aggregate Outstanding
Principal Balance of the Loan Tranches under the Master Intercompany
Loan Agreement on the relevant Funding 2 Interest Payment Date, after
taking account of such Losses or the relevant application of Principal
Receipts.
(d) Amounts to be credited to the Funding 2 Principal Deficiency Ledger
shall be credited in the following order:
(i) first, in an amount necessary to reduce to zero the balance on
the Funding 2 AAA Principal Deficiency Sub?Ledger;
(ii) second, provided that interest due on the AA Loan Tranches has
been paid, in an amount necessary to reduce to zero the balance
on the Funding 2 AA Principal Deficiency Sub-Ledger;
(iii) third, provided that interest due on the A Loan Tranches has
been paid, in an amount to reduce to zero the balance on the
Funding 2 A Principal Deficiency Sub-Ledger;
(iv) fourth, provided that interest due on the BBB Loan Tranches has
been paid, in an amount necessary to reduce to zero the balance
on the Funding 2 BBB Principal Deficiency Sub-Ledger; and
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(v) fifth, provided that interest due on the BB Loan Tranches has
been paid, in an amount necessary to reduce to zero the balance
on the BB Principal Deficiency Sub-Ledger.
28. FUNDING 2 GENERAL RESERVE LEDGER
(a) A tranche (if any) drawn down on a relevant Closing Date by Funding 2
pursuant to a Start-Up Loan Agreement for the purposes of funding the
Funding 2 General Reserve Fund (or any other similar reserve fund) will
be credited to the Funding 2 General Reserve Ledger.
(b) Amounts shall be credited to the Funding 2 General Reserve Ledger in
accordance with the Funding 2 Priority of Payments above.
(c) Amounts shall be debited to the Funding 2 General Reserve Ledger on each
Funding 2 Interest Payment Date in order to be applied in accordance
with the order of priority of payments set out in Schedule 3 to the
Funding 2 Deed of Charge.
29. FUNDING 2 LIQUIDITY RESERVE LEDGER
(a) Amounts shall be credited to the Funding 2 Liquidity Reserve Ledger in
accordance with the Funding 2 Priority of Payments above.
(b) Amounts shall be debited to the Funding 2 Liquidity Reserve Ledger to
the extent permitted on each relevant Funding 2 Interest Payment Date in
order to be applied in accordance with the priority of payments set out
in Schedule 3 to the Funding 2 Deed of Charge.
30. MASTER INTERCOMPANY LOAN LEDGER
The Cash Manager shall ensure that all payments of interest and
repayments of principal on each of the Loan Tranches are recorded in the
Master Intercompany Loan Ledger.
31. FUNDING 2 CASH ACCUMULATION LEDGER
The Cash Manager shall ensure that all Funding 2 Principal Receipts
reserved by Funding 2 to pay the relevant Bullet Loan Tranches are
recorded on the Funding 2 Cash Accumulation Ledger.
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SCHEDULE 3
FORM OF FUNDING 1 QUARTERLY REPORT
INTERCOMPANY LOAN BALANCES
[Balances]
Last Quarter Closing balance
Repayments
New Term Advances
CR to Cash Accumulation Ledger in period
CR to Principal Ledger in period
Closing Balance
CASH ACCUMULATION LEDGER
Opening balance
Principal received
Principal paid
Closing balance
PRINCIPAL LEDGER
Opening balance
Principal received
CR from PDL
Principal paid
Closing balance
AVAILABLE CREDIT ENHANCEMENT
General Reserve Fund at closing
Last Quarter Closing General Reserve Fund
Drawings to make a bullet repayment
Other drawings
Closing General Reserve Fund Balance
Target General Reserve Fund Balance
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PRINCIPAL DEFICIENCY LEDGER AAA AA BBB
Opening PDL Balance
Losses this Quarter
PDL top up from Revenue Income
Closing PDL Balance
SUBORDINATED LOAN OUTSTANDING
[Balances]
Last Quarter Closing Outstanding
Accrued Interest
Repayments Made
Closing Balance
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SCHEDULE 4
FORM OF FUNDING 2 QUARTERLY REPORT
37
SCHEDULE 5
FORM OF TRUST PROPERTY QUARTERLY REPORT
38
SIGNATORIES
Signed by )
for and on behalf of )
HALIFAX PLC )
as Cash Manager )
Signed by )
for and on behalf of )
HALIFAX PLC )
as Seller )
Signed by )
for and on behalf of )
PERMANENT MORTGAGES TRUSTEE )
LIMITED )
Signed by )
for and on behalf of )
PERMANENT FUNDING (NO. 1) LIMITED )
Signed by )
for and on behalf of )
PERMANENT FUNDING (NO. 2) LIMITED )
Signed by )
for and on behalf of )
THE BANK OF NEW YORK )
39
