Exhibit 10.1
EXECUTION COPY
AMENDED AND RESTATED FUNDING 1 LIQUIDITY
FACILITY AGREEMENT
DATED 18TH NOVEMBER, 2004
PERMANENT FUNDING (NO. 1) LIMITED
AS FUNDING 1
AND
JPMORGAN CHASE BANK, N.A.
AS FUNDING 1 LIQUIDITY FACILITY PROVIDER
AND
HALIFAX PLC
AS CASH MANAGER
AND
THE BANK OF NEW YORK
AS SECURITY TRUSTEE
XXXXX & XXXXX
XXXXX & XXXXX LLP
LONDON
CONTENTS
CLAUSE PAGE
1. Definitions and Interpretation................................3
2. The Funding 1 Liquidity Facility..............................4
3. Purpose.......................................................6
4. Conditions Precedent..........................................6
5. Drawdown......................................................7
6. Repayment.....................................................9
7. Cancellation.................................................11
8. Interest.....................................................12
9. Payments.....................................................13
10. Taxes........................................................15
11. Market Disruption............................................17
12. Increased Costs..............................................18
13. Illegality...................................................19
14. Representations and Warranties...............................19
15. Undertakings.................................................22
16. Default......................................................23
17. Fees.........................................................24
18. Enforcement and Subordination................................25
19. Expenses.....................................................26
20. Stamp Duties.................................................27
21. Indemnities..................................................27
22. Evidence and Calculations....................................28
23. Amendments and Waivers.......................................29
24. Changes to the Parties.......................................29
25. Disclosure of Information....................................31
26. Set-Off......................................................31
27. Severability.................................................32
28. Counterparts.................................................32
29. Notices......................................................32
30. Third Party Rights...........................................33
31. Governing Law................................................33
32. Submission to Jurisdiction...................................33
SCHEDULE
1. Conditions Precedent Documents...............................34
2. Calculation of the Mandatory Liquid Asset Cost...............35
3. Form of Funding 1 Liquidity Facility Request.................37
4. Form of Novation Certificate.................................38
SIGNATORIES...........................................................41
THIS AMENDED AND RESTATED FUNDING 1 LIQUIDITY FACILITY AGREEMENT is dated 18th
November, 2004
BETWEEN:
(1) PERMANENT FUNDING (NO. 1) LIMITED, (registered number 4267660) whose
registered office is Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX
(FUNDING 1);
(2) JPMORGAN CHASE BANK, N.A., acting through its offices at 000 Xxxxxx
Xxxx, Xxxxxx XX0X 0XX acting in its capacity as the Funding 1 Liquidity
Facility Provider;
(3) 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 acting in its capacity as Cash Manager; and
(4) THE BANK OF NEW YORK, acting through its offices at 00xx Xxxxx, Xxx
Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its capacity as Security Trustee,
which expression shall include such company and all other persons or
companies for the time being acting as security trustee (or co-trustee)
pursuant to the terms of the Funding 1 Deed of Charge.
WHEREAS:
(A) The parties hereto entered into the Funding 1 Liquidity Facility
Agreement (as amended and restated by this Agreement and from time to
time, the FUNDING 1 LIQUIDITY FACILITY AGREEMENT) to assist Funding 1
in, among other things, (i) making Eligible Liquidity Facility
Principal Repayments and (ii) meeting its interest payment liabilities
in respect of relevant Term Advances from time to time.
(B) Upon the terms and subject to the conditions set out in the Funding 1
Liquidity Facility Agreement, the Funding 1 Liquidity Facility Provider
agreed to make a Funding 1 Liquidity Facility available to Funding 1 on
and subject to the terms set out in the Funding 1 Liquidity Facility
Agreement.
(C) The parties to the Funding 1 Liquidity Facility Agreement have agreed
to amend and restate the terms of that Agreement as set out herein.
IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
The amended and restated master definitions and construction schedule
signed by, amongst others, the parties to this Agreement and dated 18th
November, 2004 (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.
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1.2 This Agreement amends and restates the Funding 1 Liquidity Facility
Agreement made on 14th June, 2002 as amended and restated on the 6th
March, 2003, 25th November, 2003, 12th March, 2004 and 22nd July 2004
(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 CONSTRUCTION
The Security Trustee has agreed to become a party to this Agreement
only for the purpose of taking the benefit of CLAUSES 2.3 (Extension),
5.1(B) (Funding 1 Liquidity Facility Loans), 5.2(A), (B) and (D)
(Funding 1 Liquidity Facility Stand-by Loans), 6.2 and 6.4 (Repayment),
14.1 (Representations and warranties by Funding 1), 7.2 (Voluntary
cancellation), 7.3 (Additional right of prepayment and cancellation),
14 (Representations and warranties), 15.2 (Financial information), 18
(Enforcement and Subordination), 24 (Changes to the Parties) and 29
(Notices) and for agreeing amendments to this Agreement pursuant to
CLAUSE 23 (Amendments and waivers) and for the better preservation and
enforcement of its rights under the Funding 1 Deed of Charge and
(without prejudice to the terms of the Funding 1 Deed of Charge), other
than as specified above, the Security Trustee shall assume no
obligations or liabilities whatsoever to the Funding 1 Liquidity
Facility Provider or Funding 1 by virtue of the provisions of this
Agreement.
2. THE FUNDING 1 LIQUIDITY FACILITY
2.1 FACILITY
Subject to the terms of this Agreement, the Funding 1 Liquidity
Facility Provider grants to Funding 1 the Funding 1 Liquidity Facility.
The Funding 1 Liquidity Facility may be utilised by way of Funding 1
Liquidity Facility Loans and Funding 1 Liquidity Facility Stand-by
Loans.
2.2 FACILITY LIMITS
The aggregate principal amount of the Funding 1 Liquidity Facility
Loans and the Funding 1 Liquidity Facility Stand-by Loans shall not at
any time exceed the Funding 1 Liquidity Facility Commitment. The
Funding 1 Liquidity Facility Provider is not obliged to lend more than
the Funding 1 Liquidity Facility Commitment.
Save as otherwise provided in the Agreement (including, for
the avoidance of doubt, CLAUSE 7 (Cancellation)), if any of the
following shall occur, the Funding 1 Liquidity Facility Commitment
shall be reduced in the manner provided:
(a) if the First Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by the lesser of (pound)60,000,000 and an amount
which the Rating Agencies have confirmed will have no material
adverse effect on the then current ratings of any Notes of any
Issuer (or if the rating of any of the Notes of any Issuer has
been downgraded, an amount which will not prevent the restoration
of such rating); or
(b) if the Second Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by the lesser of (pound)47,500,000 and an amount
which the Rating Agencies have confirmed will have no material
adverse effect on the then current ratings of any Notes of any
Issuer (or if the
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rating of any of the Notes of any Issuer has been downgraded, an
amount which will not prevent the restoration of such rating); or
(c) if the Third Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by the lesser of (pound)42,500,000 and an amount
which the Rating Agencies have confirmed will have no material
adverse effect on the then current ratings of any Notes of any
Issuer (or if the rating of any of the Notes of any Issuer has
been downgraded, an amount which will not prevent the restoration
of such rating); or
(d) if the Fourth Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by an amount which the Rating Agencies have
confirmed will have no material adverse effect on the then
current ratings of any Notes of any Issuer (or if the rating of
any of the Notes of any Issuer has been downgraded, an amount
which will not prevent the restoration of such rating); or
(e) if the Fifth Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by an amount which the Rating Agencies have
confirmed will have no material adverse effect on the then
current ratings of any Notes of any Issuer (or if the rating of
any of the Notes of any Issuer has been downgraded, an amount
which will not prevent the restoration of such rating); or
(f) if the Sixth Issuer Intercompany Loan is repaid in full or is
otherwise cancelled, the Funding 1 Liquidity Facility Commitment
shall be reduced by an amount which the Rating Agencies have
confirmed will have no material adverse effect on the then
current ratings of any Notes of any Issuer (or if the rating of
any of the Notes of any Issuer has been downgraded, an amount
which will not prevent the restoration of such rating).
2.3 EXTENSION
(a) Save as otherwise provided in this Agreement, Funding 1 (or the
Security Trustee or the Cash Manager on its behalf) may deliver, not
more than 30 days and not less than 20 days before the end of the
Funding 1 Liquidity Facility Commitment Period, to the Funding 1
Liquidity Facility Provider an irrevocable request in writing that the
Funding 1 Liquidity Facility Commitment Period should be extended (an
EXTENSION REQUEST) to a date that is not more than (subject to CLAUSE
2.3(D) below) 364 days starting from the last day of the then current
Funding 1 Liquidity Facility Commitment Period.
(b) If the Funding 1 Liquidity Facility Provider wishes to accept an
Extension Request then the Funding 1 Liquidity Facility Provider shall,
not more than 15 days after receipt of the Extension Request, deliver
to Funding 1 an irrevocable notice (a NOTICE OF EXTENSION) that the
Funding 1 Liquidity Facility Provider has consented to the Extension
Request. Failure to deliver such a Notice of Extension within the
15-day time period referred to above shall be deemed to constitute a
refusal to grant an extension of the Funding 1 Liquidity Facility
Commitment Period.
(c) The Funding 1 Liquidity Facility Provider shall promptly notify the
Security Trustee of each Extension Request and Notice of Extension
received or delivered (or deemed delivered) by it.
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(d) The Funding 1 Liquidity Facility Provider is not obliged to agree to
extend the Funding 1 Liquidity Facility Commitment Period and in no
event may it be extended beyond the REPAYMENT DATE, being the earlier
to occur of:
(i) the date when the First Issuer Intercompany Loan, the Second
Issuer Intercompany Loan, the Third Issuer Intercompany Loan, the
Fourth Issuer Intercompany Loan, the Fifth Issuer Intercompany
Loan and the Sixth Issuer Intercompany Loan have been repaid or
cancelled in full; and
(ii) the Funding 1 Interest Payment Date in June 2042 (unless the
parties hereto agree to extend the provision of the Funding 1
Liquidity Facility beyond such date).
3. PURPOSE
(a) Funding 1 (or the Cash Manager on behalf of Funding 1) may use each
Funding 1 Liquidity Facility Loan only to meet a Funding 1 Liquidity
Shortfall existing at that time, to the extent that it relates to
payment obligations of Funding 1 arising in connection with the First
Issuer Intercompany Loan Agreement, the Second Issuer Intercompany Loan
Agreement, the Third Issuer Intercompany Loan Agreement, the Fourth
Issuer Intercompany Loan Agreement, the Fifth Issuer Intercompany Loan
Agreement or the Sixth Issuer Intercompany Loan. For the avoidance of
doubt, the parties agree that the Funding 1 Liquidity Facility will be
available notwithstanding that one or more (but not all) of the First
Issuer Intercompany Loan Agreement, the Second Issuer Intercompany Loan
Agreement, the Third Issuer Intercompany Loan Agreement, the Fourth
Issuer Intercompany Loan Agreement, the Fifth Issuer Intercompany Loan
Agreement or the Sixth Issuer Intercompany Loan may have been repaid in
full or cancelled, subject to any reduction of the Funding 1 Liquidity
Facility Commitment in accordance with CLAUSE 2.2 (Facility Limits).
(b) Funding 1 (or the Cash Manager on behalf of Funding 1) may use a
Funding 1 Liquidity Facility Stand-by Loan only to credit the Funding 1
Liquidity Facility Stand-by Account.
(c) Without affecting the obligations of Funding 1 in any way, the Funding
1 Liquidity Facility Provider is not bound to monitor or verify the
application of any Funding 1 Liquidity Facility Drawing or any Funding
1 Liquidity Facility Stand-by Drawing.
4. CONDITIONS PRECEDENT
4.1 DOCUMENTARY CONDITIONS PRECEDENT
The obligations of the Funding 1 Liquidity Facility Provider to Funding
1 under this Agreement are subject to the condition precedent that the
Funding 1 Liquidity Facility Provider has notified Funding 1 that it
has received all of the documents set out in Schedule 1 and that each
is in form and substance satisfactory to it.
4.2 FURTHER CONDITIONS PRECEDENT
(a) The obligation of the Funding 1 Liquidity Facility Provider to make a
Funding 1 Liquidity Facility Loan or a Funding 1 Liquidity Facility
Stand-by Loan available, is subject to the further conditions precedent
that on both the date of the Funding 1 Liquidity Facility Request and
the corresponding Funding 1 Liquidity Facility Drawdown Date:
(i) no Asset Trigger Event has occurred;
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(ii) no Funding 1 Liquidity Facility Default is outstanding or would
result from the making of the Funding 1 Liquidity Facility Loan
or the Funding 1 Liquidity Facility Stand-by Loan; and
(iii) in respect of Funding 1 Liquidity Facility Loans only, no or
insufficient amounts are available for drawing from the Reserve
Funds in order to pay the liabilities in respect of which the
relevant Funding 1 Liquidity Facility Loan is to be applied.
(b) The obligation of the Funding 1 Liquidity Facility Provider to make a
Funding 1 Liquidity Facility Loan available for the purpose of a
Funding 1 Liquidity Revenue Shortfall is subject to the further
conditions precedent that, on the Funding 1 Liquidity Facility Drawdown
Date for that Funding 1 Liquidity Facility Loan, Funding 1 (or the Cash
Manager on its behalf) provides confirmation to the Funding 1 Liquidity
Facility Provider that:
(i) in respect of any Funding 1 Liquidity Facility Loan to assist the
payment of interest on the relevant Term AA Advances, the debit
balance on the relevant AA Principal Deficiency Sub-Ledger is not
in an amount equal to or in excess of 50 per cent. of the
principal amount outstanding of the relevant Term AA Advances;
(ii) in respect of any Funding 1 Liquidity Facility Loan to assist the
payment of interest on the relevant Term A Advances, the debit
balance on the relevant A Principal Deficiency Sub-Ledger is not
in an amount equal to or in excess of 50 per cent. of the
principal amount outstanding of the relevant Term A Advances; and
(iii) in respect of any Funding 1 Liquidity Facility Loan to assist the
payment of interest on the relevant Term BBB Advances, the debit
balance on the relevant BBB Principal Deficiency Sub-Ledger is
not in an amount equal to or in excess of 50 per cent. of the
principal amount outstanding of the relevant Term BBB Advances.
(c) The obligation of the Funding 1 Liquidity Facility Provider to make a
Funding 1 Liquidity Facility Loan available for the purpose of a
Funding 1 Liquidity Principal Shortfall is subject to the further
conditions precedent that:
(i) prior to the occurrence of a Trigger Event, the Funding 1
Liquidity Facility Provider is obliged only to pay:
(A) the principal amount on any relevant Original Bullet Term
Advances when such amounts are due and payable; and
(B) the principal amount on any relevant Original Scheduled
Amortisation Term Advances on their respective Final
Repayment Dates; and
(ii) following the occurrence of a Non-Asset Trigger Event but prior
to the occurrence of an Asset Trigger Event, the Funding 1
Liquidity Facility Provider is obliged only to pay the principal
amount on the relevant Original Bullet Term Advances and the
relevant Original Scheduled Amortisation Term Advances on their
respective Final Repayment Dates
in each case as confirmed by Funding 1 (or the Cash Manager on its
behalf) to the Funding 1 Liquidity Facility Provider in the Funding 1
Liquidity Facility Request.
5. DRAWDOWN
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5.1 FUNDING 1 LIQUIDITY FACILITY LOANS
(a) If, on the Business Day immediately preceding a relevant Funding 1
Interest Payment Date, the Cash Manager determines that, on the
relevant Funding 1 Interest Payment Date, a Funding 1 Liquidity
Shortfall will arise, the Cash Manager will direct Funding 1 to make a
Funding 1 Liquidity Facility Drawing on the Business Day immediately
preceding that Funding 1 Interest Payment Date, subject to the terms of
this Agreement, for all or any of the purposes set out in CLAUSE 3
(Purpose) (as appropriate) and, subject to the limits set out in CLAUSE
2.2 (Facility limits), in an amount equal to the Funding 1 Liquidity
Shortfall.
(b) Funding 1 (or Cash Manager on behalf of Funding 1) will serve on the
Funding 1 Liquidity Facility Provider a Funding 1 Liquidity Facility
Request (substantially in the form set out in SCHEDULE 3 to this
Agreement) for each Funding 1 Liquidity Facility Drawing, such request
to be given by facsimile in accordance with CLAUSE 29 (Notices) of this
Agreement to be received by the Funding 1 Liquidity Facility Provider
not later than 10.00 a.m. on the Business Day immediately preceding the
proposed Funding 1 Liquidity Facility Drawdown Date.
(c) No Funding 1 Liquidity Facility Drawing may be made, or requested to be
made, on or after the last day of the then current Funding 1 Liquidity
Facility Commitment Period.
5.2 FUNDING 1 LIQUIDITY FACILITY STAND-BY LOANS
(a) The Funding 1 Liquidity Provider shall, upon becoming aware of a
Relevant Event, promptly notify Funding 1, the Security Trustee and the
Cash Manager in writing of that fact.
(b) If a Relevant Event occurs, Funding 1 (or the Security Trustee or the
Cash Manager on behalf of Funding 1) may, subject to the terms of this
Agreement, and after serving a Funding 1 Liquidity Facility Request on
the Funding 1 Liquidity Facility Provider, make a Funding 1 Liquidity
Facility Stand-by Loan equal to the undrawn portion of the Funding 1
Liquidity Facility Commitment at that time. No Funding 1 Liquidity
Facility Stand-by Drawing may be made or requested to be made after the
end of the Funding 1 Liquidity Facility Commitment Period.
(c) Upon making a Funding 1 Liquidity Facility Stand-by Loan, Funding 1 (or
the Security Trustee or the Cash Manager on behalf of Funding 1) shall
forthwith pay the Funding 1 Liquidity Facility Stand-by Loan into the
Funding 1 Liquidity Facility Stand-by Account, which shall be an
account with the Funding 1 Liquidity Facility Provider if the Relevant
Event leading to the making of the Funding 1 Liquidity Facility
Stand-by Loan is a Funding 1 Liquidity Facility Extension Refusal.
(d) Subject to the terms of the Funding 1 Deed of Charge, interest earned
on the Funding 1 Liquidity Facility Stand-by Account, together with any
income derived from any Authorised Investments made in accordance with
PARAGRAPH (e)(iii) below using amounts standing to the credit of the
Funding 1 Liquidity Facility Stand-by Account from time to time, shall
belong to and be for the account of Funding 1 (and Funding 1 shall be
entitled to withdraw and retain such interest earned).
(e) Amounts from time to time standing to the credit of the Funding 1
Liquidity Facility Stand-by Account shall belong to Funding 1 and the
Funding 1 Liquidity Facility Provider shall not have any proprietary
interest or Security Interest in such amounts save as arises under the
Funding 1 Deed of Charge. Other than as referred to in PARAGRAPH (D)
above, Funding 1 (or the Security Trustee or the Cash Manager on behalf
of Funding 1) shall only make withdrawals from the Funding 1 Liquidity
Facility Stand-by Account:
8
(i) in such circumstances and in such amount as it would otherwise
have been able to make a Funding 1 Liquidity Facility Loan
pursuant to CLAUSE 5.1 (Funding 1 Liquidity Facility Loans),
provided that there shall be no requirement that the Funding 1
Liquidity Facility Drawdown Date falls on or before the end of
the Funding 1 Liquidity Facility Commitment Period, where there
has been a Funding 1 Liquidity Facility Extension Refusal; or
(ii) in order to make a repayment of a Funding 1 Liquidity Facility
Stand-by Loan in accordance with CLAUSE 6 (Repayment); or
(iii) in order to invest funds standing to the credit of the Funding 1
Liquidity Facility Stand-by Account in Authorised Investments
(the nature and characteristics of which Authorised Investments
Funding 1 will notify to the Funding 1 Liquidity Facility
Provider at the same time as making those investments).
(f) Any withdrawal from the Funding 1 Liquidity Facility Stand-by Account
under paragraphs 5.2(e)(i) above will be deemed to be a Funding 1
Liquidity Facility Drawing and the amount withdrawn will be deemed to
be a Funding 1 Liquidity Facility Loan.
(g) The aggregate amount of the Funding 1 Liquidity Facility Stand-by Loans
outstanding will be:
(i) reduced by the amount of any deemed Funding 1 Liquidity Facility
Loans under paragraphs 5.2(e)(i) or
(ii) above and any repayment or prepayment of all or any part of the
Funding 1 Liquidity Facility Stand-by Loans; and
(ii) increased by the amount of any deemed Funding 1 Liquidity
Facility Stand-by Loans under Sub-clause 6.3 (Repayment).
5.3 PAYMENT OF PROCEEDS
Subject to the other terms of this Agreement, the Funding 1 Liquidity
Facility Provider shall make each Funding 1 Liquidity Facility Loan or
Funding 1 Liquidity Facility Stand-by Loan available for Funding 1 on
the relevant Funding 1 Liquidity Facility Drawdown Date and shall remit
each Funding 1 Liquidity Facility Loan and Funding 1 Liquidity Facility
Stand-by Loan to Funding 1 by noon on the relevant Funding 1 Liquidity
Facility Drawdown Date or, if LIBOR is determined otherwise than in
accordance with PARAGRAPH (A) of its definition, by 2.00 p.m. on the
relevant Funding 1 Liquidity Facility Drawdown Date.
6. REPAYMENT
6.1 Subject as provided below and subject to CLAUSE 7.2 (Voluntary
Cancellation), CLAUSE 18 (Enforcement and Subordination) and CLAUSE
21.2 (Other indemnities) on the earlier of:
(i) the immediately succeeding Funding 1 Interest Payment Date; and
(ii) the Repayment Date,
Funding 1 shall repay the outstanding balance of the Funding 1
Liquidity Facility Loan, if any, from Funding 1 Available Principal
Receipts (but only to the extent that the Funding 1 Liquidity Facility
Loan has been made to meet Funding 1 Liquidity Principal Shortfalls (if
any)) and from Funding 1 Available Revenue Receipts (but only to the
extent that the Funding 1 Liquidity Facility Loan has been made to meet
Funding 1 Liquidity Revenue Shortfalls (if any)) as at the opening of
business on such date.
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6.2 Subject to the other terms of this Agreement, any amount repaid under
paragraph 6.1 above may be re-borrowed and, other than on the Repayment
Date, Funding 1 may repay a Funding 1 Liquidity Facility Loan for the
purposes of paragraph 6.1 above by making a new Funding 1 Liquidity
Facility Drawing by submitting a Funding 1 Liquidity Facility Request
for a new Funding 1 Liquidity Facility Loan or, if a Relevant Event is
outstanding, by making a deemed Funding 1 Liquidity Facility Loan or by
rolling over an existing Funding 1 Liquidity Facility Loan.
6.3 Whilst a Relevant Event is outstanding, any amount due under paragraph
6.1 above must be repaid by Funding 1 paying such amount into the
Funding 1 Liquidity Facility Stand-by Account and such payment will be
deemed to be a Funding 1 Liquidity Facility Stand-by Drawing and the
amount repaid will be deemed to be a Funding 1 Liquidity Facility
Stand-by Loan.
6.4 The Funding 1 Liquidity Facility Stand-by Loans shall, subject to
CLAUSE 18 (Enforcement and Subordination), be repayable to the Funding
1 Liquidity Facility Provider, together with accrued interest pursuant
to CLAUSE 8 (Interest), on the earlier of:
(a) the Repayment Date;
(b) if the Relevant Event resulting in the making of the Funding 1
Liquidity Facility Stand-by Drawing was a Funding 1 Liquidity
Facility Downgrade Event, then the earliest of:
(i) the date on which the Funding 1 Liquidity Facility
Commitment is made unconditionally available to Funding 1
by a new liquidity facility provider following a transfer
of all the Funding 1 Liquidity Facility Provider's rights
and obligations under this Agreement to a new liquidity
facility provider which is a Qualifying Lender and has the
Requisite Ratings under Sub-clause 24.4 (Transfers by the
Funding 1 Liquidity Facility Provider) or Sub-clause 24.5
(Assignments and transfers required by Funding 1);
(ii) the date on which a new commitment is made unconditionally
available to Funding 1 by a new liquidity facility provider
which is a Qualifying Lender and has the Requisite Ratings
following the cancellation of the Funding 1 Liquidity
Facility Commitment in whole by Funding 1 under Sub-clause
7.2 (Voluntary cancellation); and
(iii) the date falling two Business Days after the date on which
the Liquidity Facility Provider has notified Funding 1 and
the Security Trustee that it again has the Requisite
Ratings, unless a Funding 1 Liquidity Facility Extension
Refusal occurred after the Funding 1 Liquidity Facility
Downgrade Event; or
(c) if the Relevant Event resulting in the making of the Funding 1
Liquidity Facility Stand-by Drawing was a Funding 1 Liquidity
Facility Extension Refusal, then the date on which a new
commitment is made unconditionally available to Funding 1 by a
new liquidity facility provider which is a Qualifying Lender and
has the Requisite Ratings following the cancellation of the
Funding 1 Liquidity Facility Commitment in whole by Funding 1
under Sub-clause 7.2 (Voluntary cancellation).
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7. CANCELLATION
7.1 AUTOMATIC CANCELLATION OF THE FUNDING 1 LIQUIDITY FACILITY COMMITMENT
The Funding 1 Liquidity Facility Commitment shall be automatically
cancelled at close of business on the last day of the Funding 1
Liquidity Facility Commitment Period.
7.2 VOLUNTARY CANCELLATION
(a) Funding 1 may with the prior written consent of the Security Trustee
and provided that:
(i) the Rating Agencies have confirmed that such cancellation will
have no material adverse effect on the then current ratings of
any of the Notes of any Issuer; or
(ii) if the ratings of any of the Notes of any Issuer has previously
been downgraded that such cancellation will not prevent the
restoration of such rating,
without premium or penalty, cancel the undrawn and uncancelled part of
the Funding 1 Liquidity Facility Commitment in whole or in part (but if
in part, in multiples of not less than (pound)50,000 unless the Funding
1 Liquidity Facility Commitment is less than (pound)50,000) at any time
provided that it has given the Funding 1 Liquidity Facility Provider
not less than seven London Business Days' prior notice (which notice
Funding 1 shall copy to the Security Trustee, the Cash Manager and to
the Rating Agencies) stating the principal amount to be cancelled.
During such seven Business Day period Funding 1 may not serve a Funding
1 Liquidity Facility Request purporting to draw all or any part of the
amount the subject of such notice of such cancellation.
(b) If a Relevant Event has occurred, Funding 1 may, without premium or
penalty, by notice to the Funding 1 Liquidity Facility Provider (which
notice Funding 1 shall copy to the Security Trustee and the Cash
Manager) prepay any Funding 1 Liquidity Facility Loans and any Funding
1 Liquidity Facility Stand-by Loans, provided that :
(i) Funding 1 has given the Funding 1 Liquidity Facility Provider not
less than 15 Business Days' notice (copied to the Security
Trustee and the Rating Agencies);
(ii) Funding 1 has made arrangements for a new liquidity facility
provider which is a Qualifying Lender and has the Requisite
Ratings to enter into a new liquidity facility agreement on
substantially the same terms as this Agreement; and
(iii) the Funding 1 Liquidity Facility Provider has been repaid all
amounts outstanding to it under this Agreement.
(c) Funding 1 may also, without premium or penalty, by notice to the
Funding 1 Liquidity Facility Provider, cancel the whole of the Funding
1 Liquidity Facility Commitment on the Repayment Date.
7.3 ADDITIONAL RIGHT OF PREPAYMENT AND CANCELLATION
If:
(a) Funding 1 is required to pay to the Funding 1 Liquidity Facility
Provider any additional amounts under CLAUSE 10 (Taxes); or
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(b) Funding 1 is required to pay to the Funding 1 Liquidity Facility
Provider any amount under CLAUSE 12 (Increased costs),
then, without prejudice to the obligations of Funding 1 under those
Clauses, Funding 1 may, whilst the circumstances continue, give a
notice of prepayment and cancellation to the Funding 1 Liquidity
Facility Provider with a copy to the Security Trustee. On the date
falling five London Business Days after the date of giving of the
notice:
(i) Funding 1 shall prepay the Funding 1 Liquidity Facility Loans and
any Funding 1 Liquidity Facility Stand-by Loans; and
(ii) the Funding 1 Liquidity Facility Commitment shall be cancelled.
7.4 MISCELLANEOUS PROVISIONS
(a) Any notice of prepayment and/or cancellation under this Agreement is
irrevocable.
(b) All prepayments under this Agreement shall be made together with
accrued interest on the amount prepaid and, subject to CLAUSE 21
(Indemnities), without premium or penalty.
(c) No prepayment or cancellation is permitted except in accordance with
the express terms of this Agreement.
(d) No amount of the Funding 1 Liquidity Facility Commitment cancelled
under this Agreement may subsequently be reinstated except with the
prior written consent of the Funding 1 Liquidity Facility Provider,
Funding 1 and the Security Trustee.
8. INTEREST
8.1 INTEREST RATE (FUNDING 1 LIQUIDITY FACILITY LOANS)
The rate of interest on each Funding 1 Liquidity Facility Loan for each
Funding 1 Liquidity Facility Interest Period is the rate per annum
determined by the Funding 1 Liquidity Facility Provider to be the
aggregate of the applicable:
(a) Funding 1 Liquidity Facility Margin;
(b) LIBOR; and
(c) subject to CLAUSE 18 (Enforcement and Subordination), Mandatory
Liquid Asset Cost.
8.2 INTEREST RATE (FUNDING 1 LIQUIDITY FACILITY STAND-BY LOANS)
For so long as any amount is outstanding under the First Issuer
Intercompany Loan, and without prejudice to CLAUSE 17.1(A) (Commitment
Fee and Contingent Fee), the rate of interest on each Funding 1
Liquidity Facility Stand-by Loan shall be:
(a) in respect of a Funding 1 Liquidity Facility Stand-by Loan up to
(and including) the first (pound)60,000,000, the amount of
interest payable will be determined in accordance with CLAUSE 8.1
(Interest rate (Funding 1 Liquidity Facility Loans)); and
(b) in respect of a Funding 1 Liquidity Facility Stand-by Loan equal
to and in excess of (pound)60,000,001, interest will not be
payable on the amount in excess of (pound)60,000,000.
12
In the event that the First Issuer Intercompany Loan is repaid or is
otherwise cancelled, interest will not be payable in respect of any
part of a Funding 1 Liquidity Facility Stand-by Loan.
8.3 DUE DATES
Except as otherwise provided in this Agreement (including, without
limitation, CLAUSE 6 (Repayment)), accrued interest on each Funding 1
Liquidity Facility Loan and on each Funding 1 Liquidity Facility
Stand-by Loan is payable by Funding 1 on each Funding 1 Interest
Payment Date.
8.4 DEFAULT INTEREST
(a) If Funding 1 fails to pay any amount payable by it under this
Agreement, it shall forthwith on demand by the Funding 1 Liquidity
Facility Provider pay interest on the overdue amount from the due date
up to the date of actual payment, as well after as before judgment, at
a rate (the DEFAULT Rate) determined by the Funding 1 Liquidity
Facility Provider to be one per cent. per annum above the higher of:
(i) the rate on the overdue amount under CLAUSE 8.1 (Interest rate
(Funding 1 Liquidity Facility Loans)) immediately before the due
date (if of principal); and
(ii) the rate which would have been payable if the overdue amount had,
during the period of non-payment, constituted a Funding 1
Liquidity Facility Drawing in the currency of the overdue amount
for such successive Funding 1 Liquidity Facility Interest Periods
of such duration as the Funding 1 Liquidity Facility Provider may
determine (each a DESIGNATED INTEREST PERIOD).
(b) The Default Rate will be determined on each Business Day or the first
day of the relevant Designated Interest Period, as appropriate.
(c) If LIBOR is to be determined in accordance with PARAGRAPH (B) of its
definition and the Funding 1 Liquidity Facility Provider determines
that deposits in the currency of the overdue amount are not at the
relevant time being made available by the Reference Banks to leading
banks in the London interbank market, the Default Rate will be
determined by reference to the cost of funds to the Funding 1 Liquidity
Facility Provider from whatever sources it reasonably selects.
(d) Default interest will be compounded at the end of each Designated
Interest Period. (e) This CLAUSE 8.4 shall not apply to amounts
deferred as a result of the operation of CLAUSE 18 (Enforcement and
Subordination).
8.5 NOTIFICATION OF RATES OF INTEREST
The Funding 1 Liquidity Facility Provider shall promptly notify each
relevant party of the determination of a rate of interest under this
Agreement.
9. PAYMENTS
9.1 PLACE
All payments by Funding 1 under this Agreement shall be made to the
Funding 1 Liquidity Facility Provider's account at JPMorgan Chase Bank,
N.A., Sort Code: 60-92-42, Account
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Reference: European Loans or to its account at such office or bank as
it may notify to Funding 1 for this purpose.
9.2 FUNDS
Payments under this Agreement to the Funding 1 Liquidity Facility
Provider shall be made for value on the due date at such times and in
such funds as the Funding 1 Liquidity Facility Provider may specify to
the party concerned as being customary at the time for the settlement
of transactions in Sterling.
9.3 CURRENCY
(a) Amounts payable in respect of costs, expenses, taxes and the like are
payable in the currency in which they are incurred.
(b) Any other amount payable under this Agreement is, except as otherwise
provided in this Agreement, payable in Sterling.
9.4 CHANGE OF CURRENCY
(a) If more than one currency or currency unit are at the same time
recognised by the central bank of any country as the lawful currency of
that country, then:
(i) any reference in the Funding 1 Liquidity Documents to, and any
obligations arising under the Funding 1 Liquidity Documents in,
the currency of that country shall be translated into, or paid
in, the currency or currency unit of that country designated by
the Funding 1 Liquidity Facility Provider; and
(ii) any translation from one currency or currency unit to another
shall be at the official rate of exchange recognised by the
central bank for the conversion of that currency or currency unit
into the other, rounded up or down by the Funding 1 Liquidity
Facility Provider acting reasonably.
(b) If a change in any currency of a country occurs, this Agreement will be
amended to the extent the Funding 1 Liquidity Facility Provider
specifies to be necessary to reflect the change in currency and to put
the Funding 1 Liquidity Facility Provider in the same position, so far
as possible, that it would have been in if no change in currency had
occurred.
9.5 SET-OFF AND COUNTERCLAIM
All payments made by Funding 1 under this Agreement shall be made
without set-off or counterclaim.
9.6 NON-BUSINESS DAYS
(a) If a payment under this Agreement is due on a day which is not a London
Business Day, the due date for that payment shall instead be the next
London Business Day in the same calendar month (if there is one) or the
preceding London Business Day (if there is not).
(b) During any extension of the due date for payment of any principal under
this Agreement interest is payable on the principal at the rate payable
on the original due date.
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10. TAXES
10.1 GROSS-UP
Subject to CLAUSE 18 (Enforcement and Subordination) and CLAUSE 10.3
(Qualifying Lender), all payments by Funding 1 under the Funding 1
Liquidity Documents shall be made free and clear of and without
deduction or withholding for or on account of any Taxes, except to the
extent that Funding 1 is required by law to make payment subject to any
such deduction or withholding for or on account of any Taxes. If any
Tax or amount in respect of Tax is required by law to be deducted or
withheld from any amounts payable or paid by Funding 1 under the
Funding 1 Liquidity Documents, subject to CLAUSE 18 (Enforcement and
Subordination) the payment due from Funding 1 shall be increased to
include such additional amounts as may be necessary to ensure that
(after any deduction or withholding required including in respect of
such additional amounts) the Funding 1 Liquidity Facility Provider
receives a net amount equal to the full amount which would have been
due had no deduction or withholding for or on account of any Taxes been
required.
10.2 TAX RECEIPTS
Subject to CLAUSE 18 (Enforcement and Subordination), all Taxes
required by law to be deducted or withheld by Funding 1 from any
amounts paid or payable under the Funding 1 Liquidity Documents shall
be paid by Funding 1 no later than when due and Funding 1 shall, within
30 days of making either the deduction or withholding for or on account
of any Tax or the payment in respect of such deduction or withholding,
deliver to the Funding 1 Liquidity Facility Provider evidence
satisfactory to the Funding 1 Liquidity Facility Provider (acting
reasonably) (including all relevant Tax receipts) that the payment has
been duly remitted to the appropriate authority.
10.3 QUALIFYING LENDER
Funding 1 shall not be required to pay an additional amount as referred
to in CLAUSE 10.1 (Gross-up) above in respect of any deduction or
withholding for or on account of any Taxes levied or imposed by the
United Kingdom (or any taxing authority of or in the United Kingdom)
from a payment of interest, if on the date on which the payment falls
due:
(a) the payment could have been made to the Funding 1 Liquidity
Facility Provider in the absence of a deduction or withholding
for or on account of any Taxes if the Funding 1 Liquidity
Facility Provider were a Qualifying Lender, but on that date the
Funding 1 Liquidity Facility Provider is not or has ceased to be
a Qualifying Lender other than as a result of any change
occurring after the date of this Agreement in (or in the
interpretation, administration or application of) any law or
regulation or applicable Double Taxation Treaty or any published
practice or concession of any relevant Tax authority;
(b) (i) the Funding 1 Liquidity Facility Provider is a Qualifying
Lender solely because it is a UK Non-Bank Lender;
(ii) the Board of the United Kingdom Inland Revenue has given
(and not revoked) a direction (a DIRECTION) under Section
349C ICTA (as that provision has effect on the date of this
Agreement) which relates to such payment and Funding 1 has
notified the Funding 1 Liquidity Facility Provider of the
precise terms of that notice; and
15
(iii) the payment could have been made to the Funding 1 Liquidity
Facility Provider without any deduction or withholding for
or on account of Tax in the absence of that Direction;
(c) the Funding 1 Liquidity Facility Provider is a Treaty Lender and
Funding 1 is able to demonstrate that the additional amounts
referred to in CLAUSE 10.1 (Gross-up) above would not have been
required if the Funding 1 Liquidity Facility Provider had
complied with its obligations under CLAUSE 10.6 (Treaty Lender)
below.
10.4 REFUND OF TAX CREDITS
If Funding 1 makes a payment under CLAUSE 10.1 (Gross-up) (a TAX
PAYMENT) in respect of a payment to the Funding 1 Liquidity Facility
Provider under this Agreement and the Funding 1 Liquidity Facility
Provider determines that it has obtained a refund of Tax or obtained
and used a credit against Tax on its overall net income (a TAX CREDIT)
which the Funding 1 Liquidity Facility Provider determines to be
attributable to that Tax Payment, then the Funding 1 Liquidity Facility
Provider shall reimburse Funding 1 such amount as the Funding 1
Liquidity Facility Provider determines to be such proportion of that
Tax Credit as will leave the Funding 1 Liquidity Facility Provider
(after that reimbursement) in no better or worse position than it would
have been in if no Tax Payment had been required. The Funding 1
Liquidity Facility Provider shall not be obliged to disclose to any
party to this Agreement or otherwise any information regarding its Tax
affairs and computations.
10.5 STATUS OF QUALIFYING LENDER
If the Funding 1 Liquidity Facility Provider or replacement liquidity
facility provider (as applicable) ceases, for whatever reason, to be a
Qualifying Lender, it shall promptly notify Funding 1 in writing of
that change in its status.
10.6 TREATY LENDER
A Treaty Lender and Funding 1 shall co-operate in completing any
procedural formalities necessary for Funding 1 to obtain authorisation
to make payments under the Funding 1 Liquidity Documents free and clear
of and without deduction or withholding for or on account of any Taxes
levied or imposed by the United Kingdom or any taxing authority of or
in the United Kingdom.
10.7 TAX INDEMNITY
(a) Funding 1 shall (within three Business Days of demand by the Funding 1
Liquidity Facility Provider (the PROTECTED PARTY)) pay to a Protected
Party an amount equal to the loss, liability or cost which that
Protected Party determines will be or has been (directly or indirectly)
suffered for on and account of Tax by that Protected Party in respect
of the Funding 1 Liquidity Documents.
(b) PARAGRAPH (A) above shall not apply:
(i) with respect to any Tax assessed on a Protected Party:
(A) under the law of the jurisdiction in which that Protected
Party is incorporated or, if different, the jurisdiction in
which that Protected Party is treated as resident for tax
purposes; or
16
(B) under the law of the jurisdiction in which that Protected
Party's Facility Office is located in respect of amounts
received or receivable in that jurisdiction,
if that Tax is imposed or calculated by reference to the net
income received or receivable (but not any sum deemed to be
received or receivable) by that Protected Party;
(ii) to the extent a loss, liability or cost:
(A) is compensated for by an increased payment under CLAUSE
10.1 (Gross-up); or
(B) would have been compensated for by an increased payment
under CLAUSE 10.1 (Gross-up) but was not so compensated
solely because one of the exclusions in CLAUSE 10.3
(Qualifying Lender) applied.
11. MARKET DISRUPTION
(a) If LIBOR is to be determined in accordance with PARAGRAPH (B) of its
definition and a Reference Bank does not supply an offered rate by 1.00
p.m. on a Funding 1 Liquidity Facility Drawdown Date, the applicable
LIBOR shall, subject to PARAGRAPH (B) below, be determined on the basis
of the quotations of the remaining Reference Bank(s).
(b) If, in relation to any Funding 1 Liquidity Facility Drawing or proposed
Funding 1 Liquidity Facility Drawing or Funding 1 Liquidity Facility
Stand-by Drawing or proposed Funding 1 Liquidity Facility Stand-by
Drawing:
(i) LIBOR is to be determined in accordance with PARAGRAPH (B) of its
definition and no, or only one, Reference Bank supplies a rate
for the purposes of determining the applicable LIBOR or the
Funding 1 Liquidity Facility Provider otherwise determines that
adequate and fair means do not exist for ascertaining the
applicable LIBOR; or
(ii) in the Funding 1 Liquidity Facility Provider's opinion:
(A) matching deposits may not be available to it in the London
interbank market in the ordinary course of business to fund
that Funding 1 Liquidity Facility Loan or Funding 1
Liquidity Facility Stand-by Loan for the relevant Funding 1
Liquidity Facility Interest Period; or
(B) the cost to it of matching deposits in the London interbank
market would be in excess of the relevant LIBOR,
the Funding 1 Liquidity Facility Provider shall promptly notify Funding
1 of the fact and that this CLAUSE 11 is in operation.
(c) After any notification under PARAGRAPH (B) above, the Funding 1
Liquidity Facility Loan or Funding 1 Liquidity Facility Stand-by Loan,
as the case may be, shall bear interest at the rate per annum equal to
the sum of the applicable Funding 1 Liquidity Facility Margin,
Mandatory Liquid Asset Cost and the cost to the Funding 1 Liquidity
Facility Provider (expressed as a rate per annum) of funding the
Funding 1 Liquidity Facility Loan or Funding 1 Liquidity Facility
Stand-by Loan, respectively, by whatever means it reasonably determines
to be appropriate.
17
12. INCREASED COSTS
12.1 INCREASED COSTS
(a) Subject to CLAUSE 12.2 (Exceptions) and CLAUSE 18 (Enforcement and
Subordination), Funding 1 shall forthwith on demand by the Funding 1
Liquidity Facility Provider pay the Funding 1 Liquidity Facility
Provider the amount of any increased cost incurred by it as a result
of:
(i) the introduction of, or any change in, or any change in the
interpretation by any court or official authority or application
of, any law or regulation or in the case of Tax, the introduction
of or any change in or any change in the interpretation,
administration or application of any law or regulation or
published practice or concession of any relevant tax authority
(in each case occurring after the date of this Agreement);
(ii) compliance with any regulation made or modified after the date of
this Agreement,
including any law or regulation relating to change in currency of a
country or reserve asset, special deposit, cash ratio, liquidity or
capital adequacy requirements or any other form of banking or monetary
control or in the case of taxation, any law, regulation, published
practice or concession relating to Tax.
(b) In this Agreement INCREASED COST means:
(i) an additional cost incurred by the Funding 1 Liquidity Facility
Provider or its holding company as a result of it having entered
into, or performing, maintaining or funding its obligations
under, the Funding 1 Liquidity Documents; or
(ii) that portion of an additional cost incurred by the Funding 1
Liquidity Facility Provider or its holding company in making,
funding or maintaining all or any advances comprised in a class
of advances formed by or including the Funding 1 Liquidity
Facility Loans or Funding 1 Liquidity Facility Stand-by Loan made
or to be made under the Funding 1 Liquidity Documents as is
attributable to it making, funding or maintaining those
participations; or
(iii) a reduction in any amount payable to the Funding 1 Liquidity
Facility Provider or its holding company or the effective return
to a Funding 1 Liquidity Facility Provider under this Agreement
or (to the extent that it is attributable to this Agreement) on
its capital, including any reduction in the effective return from
the Funding 1 Liquidity Facility Margin or the commitment fee
payable under CLAUSE 17 (Fees) of this Agreement; or
(iv) the amount of any payment made by the Funding 1 Liquidity
Facility Provider or its holding company, or the amount of
interest or other return foregone by the Funding 1 Liquidity
Facility Provider, calculated by reference to any amount received
or receivable by the Funding 1 Liquidity Facility Provider from
any other Party under this Agreement.
12.2 EXCEPTIONS
CLAUSE 12.1 (Increased costs) does not apply to any increased cost:
(a) to the extent compensated for by the payment of the Mandatory Liquid
Asset Cost;
18
(b) to the extent compensated for by the operation of CLAUSE 10.7 (Tax
Indemnity); or
(c) to the extent that any such increased cost is attributable to any
deduction or withholding for or on account of any Tax required to be
made by Funding 1.
13. ILLEGALITY
If it is or becomes unlawful in any jurisdiction for the Funding 1
Liquidity Facility Provider to give effect to any of its obligations as
contemplated by this Agreement or to fund or maintain any Funding 1
Liquidity Facility Loan or Funding 1 Liquidity Facility Stand-by Loan,
then:
(a) the Funding 1 Liquidity Facility Provider may notify Funding 1
accordingly; and
(b) (i) subject to CLAUSE 18 (Enforcement and Subordination),
Funding 1 shall forthwith prepay the Funding 1 Liquidity
Facility Loans or Funding 1 Liquidity Facility Stand-by
Loan together with all interest and all other amounts
payable by it to the Funding 1 Liquidity Facility Provider
under this Agreement; and
(ii) the Funding 1 Liquidity Facility Commitment shall be
cancelled.
14. REPRESENTATIONS AND WARRANTIES
14.1 REPRESENTATIONS AND WARRANTIES BY FUNDING 1
Funding 1 makes the representations and warranties set out in this
CLAUSE 14.1 to the Funding 1 Liquidity Facility Provider and the
Security Trustee:
(A) STATUS
(i) It is a limited liability company, duly incorporated and
validly existing under the laws of England and Wales; and
(ii) it has the power to own its assets and carry on its
business as it is being conducted.
(B) POWERS AND AUTHORITY
It has the power to enter into and perform, and has taken all
necessary action to authorise the entry into, performance and
delivery of, the Funding 1 Liquidity Documents to which it is or
will be a party and the transactions contemplated by those
Funding 1 Liquidity Documents.
(C) LEGAL VALIDITY
Each Funding 1 Liquidity Document to which it is or will be a
party constitutes, or when executed in accordance with its terms
will constitute, its legal, valid and binding obligation
enforceable in accordance with its terms.
(D) NON-CONFLICT
The entry into and performance by it of, and the transactions
contemplated by, the Funding 1 Liquidity Documents do not and
will not:
19
(i) result in the existence or imposition of nor oblige it to
create any Security Interest in favour of any person (other
than the Funding 1 Secured Creditors) over all or any of
its present or future revenues or assets;
(ii) conflict with any law or regulation or judicial or official
order;
(iii) conflict with its constitutional documents; or (iv)
conflict with any document which is binding upon it or any
of its assets.
(E) NO DEFAULT
No Liquidity Facility Default is outstanding or might result from
the making of any Funding 1 Liquidity Facility Loan or Funding 1
Liquidity Facility Stand-by Loan.
(F) AUTHORISATIONS
All authorisations required or desirable in connection with the
entry into, performance, validity and enforceability of, and the
transactions contemplated by, the Funding 1 Liquidity Documents
have been obtained or effected (as appropriate) and are in full
force and effect.
(G) LITIGATION
No litigation, arbitration or administrative proceedings
involving Funding 1 are current or, to its knowledge, pending or
threatened, which might, if adversely determined, have a material
adverse effect on the business or financial condition of Funding
1 or the ability of Funding 1 to perform its obligations under
this Agreement.
(H) SECURITY INTERESTS
None of the assets of Funding 1 is affected by any Security
Interest, and Funding 1 is not a party to, nor is it or any of
its assets bound by, any order, agreement or instrument under
which Funding 1 is, or in certain events may be, required to
create, assume or permit to arise any Security Interest, other
than the Security Interests created by the Funding 1 Deed of
Charge.
(I) NO OTHER BUSINESS
(i) It has not traded or carried on any business since its date
of incorporation or engaged in any activity whatsoever that
is not incidental to or necessary in connection with any of
the activities in which the Transaction Documents provide
or envisage that it will engage; and
(ii) it is not party to any material agreements other than the
Transaction Documents.
(J) OWNERSHIP
(i) Its entire issued share capital is legally and beneficially
owned and controlled by Holdings; and
(ii) its shares are fully paid.
20
(K) GOOD TITLE AS TO ASSETS
Funding 1 is and will remain the absolute beneficial owner of the
Funding 1 Share and absolute legal and beneficial owner of all
other assets charged or assigned by the Funding 1 Deed of Charge
to which it is a party.
(L) TAX
(i) It is tax resident and legally domiciled in its
jurisdiction of incorporation; and (ii) it has no branch,
business establishment or other fixed establishment outside
the United Kingdom.
(M) FUNDING 1 DEED OF CHARGE
The Funding 1 Deed of Charge creates, or will create when the
Funding 1 Liquidity Facility Stand-by Account is opened and the
Funding 1 Liquidity Facility Stand-By Deposit is credited to such
account, a first priority Security Interest of the type described
in the Funding 1 Deed of Charge over the Funding 1 Liquidity
Facility Stand-by Deposit in favour of the Security Trustee.
For the avoidance of doubt, a breach by Funding 1 of any representation
or warranty contained in this CLAUSE 14.1 or otherwise in this
Agreement shall not entitle the Funding 1 Liquidity Facility Provider
to terminate this Agreement or declare the Funding 1 Liquidity Facility
Loans or the Funding 1 Liquidity Facility Stand-by Loans or any other
amounts payable under this Agreement due and payable or to prevent any
utilisation of the Funding 1 Liquidity Facility or the Stand-by
Facility or any Funding 1 Liquidity Facility Loan or Funding 1
Liquidity Facility Stand-by Loan being made.
14.2 REPRESENTATIONS AND WARRANTIES BY THE FUNDING 1 LIQUIDITY FACILITY
PROVIDER
The Funding 1 Liquidity Facility Provider makes the representations and
warranties set out in this CLAUSE 14.2 to Funding 1 and the Security
Trustee.
(A) STATUS
It is duly incorporated with limited liability under the laws of
the jurisdiction of its incorporation and is an authorised
institution under the FSMA 2000.
(B) TAX STATUS
It is a Qualifying Lender.
(C) POWERS AND AUTHORISATIONS
The documents which contain or establish its constitution include
provisions which give power, and all necessary corporate
authority has been obtained and action taken, for it to sign and
deliver, and perform the transactions contemplated in this
Agreement and the agreements entered into in connection herewith
and this Agreement and the agreements entered into in connection
herewith constitute its valid, legal and binding obligations.
(D) RATING
21
It has the Requisite Ratings (and will promptly notify both
Funding 1 and the Security Trustee of the occurrence of any
downgrading by the Rating Agencies of any of its rated debt
obligations to a level below the Requisite Ratings).
(E) NON-VIOLATION
Neither the signing and delivery of this Agreement nor the
performance of any of the transactions contemplated in it does or
will contravene or constitute a default under, or cause to be
exceeded any limit on the Funding 1 Liquidity Facility Provider
or the powers of its directors imposed by or contained in (i) any
law by which it or any of its assets is bound or affected, or
(ii) any agreement to which it is a party or by which any of its
assets is bound.
14.3 TIMES FOR MAKING REPRESENTATIONS AND WARRANTIES
The representations and warranties set out in this CLAUSE 14
(Representations and warranties):
(a) are made on the date of this Agreement; and
(b) save in respect of the representation and warranty of the Funding
1 Liquidity Facility Provider given under CLAUSE 14.2(B) (Tax
Status), are deemed to be repeated by the relevant Party on the
date of each Funding 1 Liquidity Facility Request, each Funding 1
Liquidity Facility Drawdown Date and each Funding 1 Interest
Payment Date with reference to the facts and circumstances then
existing.
15. UNDERTAKINGS
15.1 DURATION
The undertakings in this CLAUSE 15 remain in force from the date of
this Agreement for so long as any amount is or may be outstanding under
this Agreement or any Funding 1 Liquidity Facility Commitment is in
force.
15.2 FINANCIAL INFORMATION
Funding 1 shall supply to the Funding 1 Liquidity Facility Provider and
the Security Trustee:
(a) as soon as the same are available (and in any case before the
latest date for publication in accordance with the Companies Xxx
0000, as amended), its audited accounts for that financial year
which shall be in such form as will comply with relevant legal
and accounting requirements for the time being; and
(b) promptly such other information as the Security Trustee may
reasonably request.
15.3 INFORMATION - MISCELLANEOUS
Funding 1 shall supply to the Funding 1 Liquidity Facility Provider
promptly, such further information in its possession or control
regarding its financial condition and operations as it supplies to the
Security Trustee, if the Funding 1 Liquidity Facility Provider so
requests.
15.4 NOTIFICATION OF DEFAULT
Funding 1 shall notify the Funding 1 Liquidity Facility Provider of any
Funding 1 Liquidity Facility Default (and the steps, if any, being
taken to remedy it) promptly upon its occurrence.
22
15.5 AUTHORISATIONS
Funding 1 shall promptly:
(a) obtain, maintain and comply with the terms of; and
(b) supply certified copies to the Funding 1 Liquidity Facility
Provider of,
any authorisation required under any law or regulation to enable it to
perform its obligations under, or for the validity or enforceability
of, any Funding 0 Xxxxxxxxx Xxxxxxxx.
00.0 XXXXXX XXXXXX ACTIVITIES
Funding 1 will not engage in any activities in the United States
(directly or through agents), will not derive any income from United
States sources as determined under United States income tax principles,
and will not hold any property if doing so would cause it to be engaged
or deemed to be engaged in a trade or business within the United States
as determined under United States income tax principles.
16. DEFAULT
16.1 FUNDING 1 LIQUIDITY FACILITY DEFAULT
Each of the events set out in CLAUSES 16.2 (Non-Payment) to 16.4
(Unlawfulness) (inclusive) is a Funding 1 Liquidity Facility Default
(whether or not caused by any reason whatsoever outside the control of
Funding 1 or any other person).
16.2 NON-PAYMENT
(a) Subject to PARAGRAPH (B) below, Funding 1 does not pay within 3 London
Business Days of the due date any amount payable by it under the
Funding 1 Liquidity Documents at the place at and in the currency in
which it is expressed to be payable.
(b) The Funding 1 Liquidity Facility Provider agrees that the non-payment
of any Funding 1 Liquidity Subordinated Amounts shall only constitute a
Funding 1 Liquidity Facility Default under PARAGRAPH (a) above in
circumstances where Funding 1 has the requisite funds to pay such
amounts in accordance with the Funding 1 Deed of Charge on the relevant
due date and any such Funding 1 Liquidity Subordinated Amounts are not
then paid.
16.3 INTERCOMPANY LOAN ACCELERATION NOTICE
An Intercompany Loan Acceleration Notice is served or the Security
Trustee having become bound to serve an Intercompany Loan Acceleration
Notice fails to do so within 30 days of becoming so bound.
16.4 UNLAWFULNESS
It is or becomes unlawful for Funding 1 to perform any of its
obligations under the Funding 1 Liquidity Documents.
16.5 ACCELERATION
On and at any time after the occurrence of a Funding 1 Liquidity
Facility Default and subject to CLAUSE 18 (Enforcement and
Subordination) and if such Funding 1 Liquidity Facility Default is
continuing the Funding 1 Liquidity Facility Provider may by notice to
Funding 1:
23
(a) cancel the Funding 1 Liquidity Facility Commitment; and/or
(b) demand that all or part of the Funding 1 Liquidity Facility Loans
or the Funding 1 Liquidity Facility Stand-by Loans, together with
accrued interest, and all other amounts accrued under this
Agreement be immediately due and payable, whereupon they shall
become immediately due and payable; and/or
(c) demand that all or part of the Funding 1 Liquidity Facility Loans
or the Funding 1 Liquidity Facility Stand-by Loans be payable on
demand, whereupon they shall immediately become payable on
demand.
17. FEES
17.1 COMMITMENT FEE AND CONTINGENT FEE
(a) Funding 1 shall (subject to CLAUSE 17.1(B) and (C) below and to CLAUSE
18 (Enforcement and Subordination)) pay to the Funding 1 Liquidity
Facility Provider a commitment fee computed at the rate of 0.08 per
cent. per annum on the undrawn, uncancelled amount of the Funding 1
Liquidity Facility Commitment during the period from the date of this
Agreement up to and including the last day of the Funding 1 Liquidity
Facility Commitment Period.
(b) In the event that a Funding 1 Liquidity Facility Stand-by Drawing is
made, and for so long as any amount is outstanding under the First
Issuer Intercompany Loan:
(i) in respect of a Funding 1 Liquidity Facility Stand-by Drawing up
to (and including) the first (pound)60,000,000, the Commitment
Fee referred to in CLAUSE 17.1(A) (Commitment Fee and ContiNGENT
Fee) will not be payable and in its place Funding 1 will (subject
to CLAUSE 18 (Enforcement and Subordination)) pay to the Funding
1 Liquidity Facility Provider interest as determined in
accordance with CLAUSE 8.1 (Interest rate (Funding 1 Liquidity
Facility Loans)) and CLAUSE 8.2 (Interest rate (Funding 1
Liquidity Facility Stand-by Loans)); and
(ii) in respect of a Funding 1 Liquidity Facility Stand-by Drawing
equal to and in excess of (pound)60,000,001, the Commitment Fee
referred to in CLAUSE 17.1(A) (Commitment Fee and Contingent Fee)
will not be payable and in its place Funding 1 will (subject to
CLAUSE 18 (Enforcement and Subordination) pay to the Funding 1
Liquidity Facility Provider a contingent fee computed at the rate
of 0.38 per cent. per annum on the amount of the Funding 1
Liquidity Facility Stand-by Drawing in excess of
(pound)60,000,000, together with, for the avoidance of doubt, ANY
amount payable pursuant to CLAUSE 17.1(B)(I) (Commitment Fee and
Contingent Fee) with respect to a Funding 1 Liquidity Facility
Stand-by Drawing up to (and including) the first
(pound)60,000,000, plus an amount equal to any interest received
by Funding 1 on the FundING 1 Liquidity Facility Stand-by Account
insofar as it relates to the amount in excess of
(pound)60,000,000.
(c) In the event that the First Issuer Intercompany Loan is repaid or is
otherwise cancelled and a Funding 1 Liquidity Stand-by Drawing is made,
the Commitment Fee referred to in CLAUSE 17.1(A) (Commitment Fee and
Contingent Fee) will not be payable and in its place Funding 1 will
(subject to CLAUSE 18 (Enforcement and Subordination) pay to the
Funding 1 Liquidity Facility Provider a contingent fee computed at the
rate of 0.38 per cent. per annum on the amount of the Funding 1
Liquidity Stand-by Drawing, plus an amount equal to any interest
received by Funding 1 on the Funding 1 Liquidity Facility Stand-by
Account.
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(d) Subject to CLAUSE 18 (Enforcement and Subordination), the accrued
commitment fee and contingent fee is payable quarterly in arrear on
each Funding 1 Interest Payment Date. The accrued commitment fee and
contingent fee is also payable to the Funding 1 Liquidity Facility
Provider on the cancelled amount of the Funding 1 Liquidity Facility
Commitment at the time the cancellation takes effect.
17.2 VAT
(a) All payments to be made by Funding 1 under the Funding 1 Liquidity
Documents are exclusive of VAT chargeable thereon and Funding 1 shall
pay to the Funding 1 Liquidity Facility Provider a sum in respect of
any VAT chargeable in respect of any supply made by the Funding 1
Liquidity Facility Provider for the purposes of VAT in connection with
the Funding 1 Liquidity Documents.
(b) If VAT is chargeable on any supply made by the Funding 1 Liquidity
Facility Provider to any other person in connection with a Funding 1
Liquidity Document and Funding 1 is required by the terms of any
Funding 1 Liquidity Document to pay an amount equal to the
consideration for such supply to the Funding 1 Liquidity Facility
Provider, Funding 1 shall also pay to the Funding 1 Liquidity Facility
Provider (in addition to and at the same time as paying such amount) an
amount equal to the amount of such VAT.
(c) Where under the Funding 1 Liquidity Documents, Funding 1 is required to
reimburse or indemnify the Funding 1 Liquidity Facility Provider
against any costs, expenses (including legal fees), loss or liability
or otherwise, such obligation to reimburse or indemnify shall extend to
any VAT charged to the Funding 1 Liquidity Facility Provider on such
costs, expenses (including legal fees) or in respect of such loss,
liability or otherwise which is irrecoverable by the Funding 1
Liquidity Facility Provider.
18. ENFORCEMENT AND SUBORDINATION
(a) The Funding 1 Liquidity Facility Provider acknowledges to the Security
Trustee that it is bound by the terms of the Funding 1 Deed of Charge
and, in particular, confirms that no sum, whether in respect of
principal or interest or otherwise relating to any Funding 1 Liquidity
Facility Loan or any Funding 1 Liquidity Facility Stand-by Loan, shall
be paid by Funding 1 except in accordance with the provisions of the
Funding 1 Cash Management Agreement and the Funding 1 Deed of Charge
unless and until all sums required by the Funding 1 Cash Management
Agreement or the Funding 1 Deed of Charge, as the case may be, to be
paid or provided for in priority thereto have been paid or discharged
in full.
(b) The Funding 1 Liquidity Facility Provider further agrees that only the
Security Trustee may enforce the security created in favour of, inter
alios, the Funding 1 Liquidity Facility Provider and the Security
Trustee by the Funding 1 Deed of Charge and that the Funding 1
Liquidity Facility Provider shall not take any steps for the purpose
of:
(i) recovering any debts whatsoever owing to it by Funding 1 save as
provided for in accordance with the terms of the Funding 1 Deed
of Charge (including, without limitation, by exercising any right
of set-off); or
(ii) enforcing any rights arising out of this Agreement against
Funding 1; or
(iii) procuring the winding-up, administration or liquidation of
Funding 1 in respect of any of its liabilities whatsoever,
25
unless the Security Trustee, having become bound to serve an
Intercompany Loan Acceleration Notice, fails to do so within 30 days of
becoming so bound and that failure is continuing (in which case the
Funding 1 Liquidity Facility Provider shall be entitled to take any
such steps and proceedings as it shall deem necessary other than (i)
any legal proceedings for the winding-up of, or for an administration
order or (ii) filing documents with the court for the appointment of an
administrator or (iii) serving a notice of intention to appoint an
administrator, in respect of Funding 1) provided that the Funding 1
Liquidity Facility Provider shall not be entitled to take any steps or
proceedings pursuant to this Agreement which would contravene CLAUSES 5
to 9 of the Funding 1 Deed of Charge.
(c) Subject to PARAGRAPH (B) above, the Funding 1 Liquidity Facility
Provider agrees to defer taking any action or proceedings against
Funding 1 to recover any amounts payable by Funding 1 to the Funding 1
Liquidity Facility Provider under this Agreement except to the extent
expressly permitted by the provisions of the Funding 1 Deed of Charge
unless and until (then only to the extent that) Funding 1 has assets
sufficient to meet such claim in full having taken into account all
other liabilities (actual, contingent or prospective) of Funding 1
which under the Funding 1 Deed of Charge rank pari passu with or in
priority to its liabilities to the Funding 1 Liquidity Facility
Provider under this Agreement, provided however that nothing in this
PARAGRAPH (C) shall prevent the Funding 1 Liquidity Facility Provider
from proving for the full amount owed to it by Funding 1 under this
Agreement in the liquidation of Funding 1.
(d) Without prejudice to the other provisions of this CLAUSE 18, the
Funding 1 Liquidity Facility Provider covenants with the Security
Trustee that if, whether in the liquidation of Funding 1 or otherwise
(and notwithstanding the provisions of this CLAUSE 18), any payment
(whether of principal, interest or otherwise) is received by it in
respect of a Funding 1 Liquidity Facility Loan or a Funding 1 Liquidity
Facility Stand-by Loan other than in accordance with CLAUSES 4 and 6 of
the Funding 1 Cash Management Agreement and CLAUSES 7 and 8 of the
Funding 1 Deed of Charge, the amount so paid shall be received and held
by the Funding 1 Liquidity Facility Provider upon trust for the
Security Trustee and shall be paid over to the Security Trustee
forthwith upon receipt provided however that this PARAGRAPH (D) shall
have effect only to the extent that it does not constitute or create
and is not deemed to constitute or create any mortgage, charge or other
Security Interest of any kind.
19. EXPENSES
19.1 INITIAL AND SPECIAL COSTS
Subject to CLAUSE 18 (Enforcement and Subordination), Funding 1 shall
forthwith on demand pay the Funding 1 Liquidity Facility Provider the
amount of all costs and expenses (including reasonable legal fees)
incurred by it in connection with:
(a) the negotiation, preparation, printing and execution of:
(i) this Agreement and any other documents referred to in this
Agreement;
(ii) any other Funding 1 Liquidity Document (other than a
Novation Certificate) executed after the date of this
Agreement;
(b) any amendment, waiver, consent or suspension of rights (or any
proposal for any of the foregoing) requested by or on behalf of
Funding 1 or, in the case of CLAUSE 9.4 (Change of currency), the
Funding 1 Liquidity Facility Provider and relating to a Funding 1
Liquidity Document or a document referred to in any Funding 1
Liquidity Document; and
26
(c) any other matter, not of an ordinary administrative nature,
arising out of or in connection with a Funding 1 Liquidity
Document.
19.2 ENFORCEMENT COSTS
Subject to CLAUSE 18 (Enforcement and Subordination), Funding 1 shall
forthwith on demand pay to the Funding 1 Liquidity Facility Provider
the amount of all costs and expenses (including legal fees) incurred by
it:
(a) in connection with the enforcement of, or the preservation of any
rights under, any Funding 1 Liquidity Document; or
(b) in investigating any possible Funding 1 Liquidity Facility
Default.
20. STAMP DUTIES
Subject to CLAUSE 18 (Enforcement and Subordination), Funding 1 shall
pay and forthwith on demand indemnify the Funding 1 Liquidity Facility
Provider against any liability it incurs in respect of any United
Kingdom stamp, registration and similar tax which is or becomes payable
in connection with the entry into, performance or enforcement of any
Funding 1 Liquidity Document.
21. INDEMNITIES 21.1 CURRENCY INDEMNITY
(a) Subject to CLAUSE 18 (Enforcement and Subordination), if the Funding 1
Liquidity Facility Provider receives an amount in respect of Funding
1's liability under the Funding 1 Liquidity Documents or if that
liability is converted into a claim, proof, judgment or order in a
currency other than the currency (the CONTRACTUAL CURRENCY) in which
the amount is expressed to be payable under the relevant Funding 1
Liquidity Document:
(i) Funding 1 shall indemnify the Funding 1 Liquidity Facility
Provider as an independent obligation against any loss or
liability arising out of or as a result of the conversion;
(ii) if the amount received by the Funding 1 Liquidity Facility
Provider, when converted into the contractual currency at a
market rate in the usual course of its business, is less than the
amount owed in the contractual currency, Funding 1 shall
forthwith on demand pay to the Funding 1 Liquidity Facility
Provider an amount in the contractual currency equal to the
deficit; and
(iii) Funding 1 shall forthwith on demand pay to the Funding 1
Liquidity Facility Provider on demand any exchange costs and
taxes payable in connection with any such conversion.
(b) Funding 1 waives any right it may have in any jurisdiction to pay any
amount under the Funding 1 Liquidity Documents in a currency other than
that in which it is expressed to be payable.
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21.2 OTHER INDEMNITIES
Subject to CLAUSE 18 (Enforcement and Subordination), Funding 1 shall
forthwith on demand indemnify the Funding 1 Liquidity Facility Provider
against any loss or liability which that Funding 1 Liquidity Facility
Provider incurs as a consequence of:
(a) the operation of CLAUSE 16.5 (Acceleration) or if the loss or
liability is caused by Funding 1 making a payment other than in
accordance with CLAUSE 9 (Payments);
(b) any payment of principal or an overdue amount being received from
any source otherwise than on its Funding 1 Interest Payment Date
and, for the purposes of this PARAGRAPH (B), the Funding 1
Interest Payment Date of an overdue amount is the last day of
each Designated Interest Period (as defined in CLAUSE 8.4
(Default interest)); or
(c) (other than by reason of negligence or default by the Funding 1
Liquidity Facility Provider) a Funding 1 Liquidity Facility Loan
or a Funding 1 Liquidity Facility Stand-by Loan not being made
after Funding 1 has delivered a Funding 1 Liquidity Facility
Request for that Funding 1 Liquidity Facility Loan or Funding 1
Liquidity Facility Stand-by Loan; or
(d) any reasonable costs, including legal fees, which the Funding 1
Liquidity Facility Provider may sustain or incur as a consequence
of any default by Funding 1 in the performance of any of the
obligations expressed to be assumed by it in this Agreement.
Funding 1's liability in each case includes any loss of margin or other
loss or expense on account of funds borrowed, contracted for or
utilised to fund any amount payable under any Funding 1 Liquidity
Document, any amount repaid or prepaid or any Funding 1 Liquidity
Facility Loan or Funding 1 Liquidity Facility Stand-by Loan.
22. EVIDENCE AND CALCULATIONS
22.1 ACCOUNTS
Accounts maintained by the Funding 1 Liquidity Facility Provider in
connection with this Agreement are prima facie evidence of the matters
to which they relate.
22.2 CERTIFICATES AND DETERMINATIONS
Any certification or determination by the Funding 1 Liquidity Facility
Provider of a rate or amount under this Agreement is, in the absence of
manifest error, conclusive evidence of the matters to which it relates.
22.3 CALCULATIONS
Interest (including any applicable Mandatory Liquid Asset Cost) and the
fee payable under CLAUSE 17.1 (Commitment fee and contingent fee)
accrue from day to day and are calculated on the basis of the actual
number of days elapsed and a year of 365 days or, if market practice
dictates, 360 days.
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23. AMENDMENTS AND WAIVERS
23.1 PROCEDURE
Subject to CLAUSE 25 of the Funding 1 Deed of Charge (Supplemental
Provisions Regarding the Security Trustee), any term of the Funding 1
Liquidity Documents may be amended or waived with the written agreement
of Funding 1, the Security Trustee and the Funding 1 Liquidity Facility
Provider.
23.2 WAIVERS AND REMEDIES CUMULATIVE
The rights of the Funding 1 Liquidity Facility Provider under the
Funding 1 Liquidity Documents:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the general
law; and (c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a waiver
of that right.
24. CHANGES TO THE PARTIES
24.1 TRANSFERS BY FUNDING 1
Funding 1 may not assign, transfer, novate or dispose of any of, or any
interest in, the Funding 1 Liquidity Facility Commitment and/or rights
and/or obligations under this Agreement except that Funding 1 may
assign its rights under this Agreement to the Security Trustee pursuant
to the Funding 1 Deed of Charge.
24.2 TRANSFER BY THE SECURITY TRUSTEE
The Security Trustee may assign its rights under this Agreement to any
successor security trustee or trustees under the Funding 1 Deed of
Charge.
24.3 TRANSFERS BY THE CASH MANAGER
The Cash Manager may assign its rights under this Agreement to any
successor Cash Manager under the Cash Management Agreement.
24.4 TRANSFERS BY THE FUNDING 1 LIQUIDITY FACILITY PROVIDER
(a) The Funding 1 Liquidity Facility Provider may, subject to the following
provisions of this Sub-clause, at any time assign or transfer
(including by way of novation) any of its rights and obligations under
this Agreement to a new liquidity facility provider which is a
Qualifying Lender (save that the Funding 1 Liquidity Facility Provider
may assign or transfer to a liquidity facility provider who is not at
the time of the proposed assignment or transfer a Qualifying Lender if,
as a matter of law, no Tax Payment or Increased Cost will be payable by
Funding 1 immediately after such proposed assignment or transfer) and
has the Requisite Ratings (the NEW LIQUIDITY FACILITY PROVIDER).
(b) The consent of Funding 1 and the Security Trustee is required for any
assignment or transfer unless:
29
(i) the New Liquidity Facility Provider is an Affiliate of the
Funding 1 Liquidity Facility Provider; or
(ii) a Funding 1 Liquidity Facility Default is outstanding (in which
case no consent is required from Funding 1 or the Security
Trustee).
(c) The consent of Funding 1 and the Security Trustee must not be
unreasonably withheld or delayed. Funding 1 and the Security Trustee
will be deemed to have given their consent fourteen days after Funding
1 and the Security Trustee are given notice of the request unless it is
expressly refused by Funding 1 or the Security Trustee within that
time. Upon such consent being given (or deemed given), Funding 1 and
the Security Trustee will take such steps as are reasonably required by
the Funding 1 Liquidity Facility Provider to effect the assignment or
transfer, including the execution of the transfer certificate referred
to in paragraph (d) below.
(d) A transfer of obligations will be effective only if the Funding 1
Liquidity Facility Provider and the New Liquidity Facility Provider
deliver to Funding 1 and the Security Trustee a duly completed
certificate, substantially in the form of Schedule 4 (Form of Novation
Certificate) and each of Funding 1 and the Security Trustee executes
the certificate to confirm its consent to the transfer. On the transfer
becoming effective in this manner the Funding 1 Liquidity Facility
Provider will be released from its obligations under this Agreement to
the extent that they are transferred to the New Liquidity Facility
Provider.
(e) Nothing in this Agreement restricts the ability of the Funding 1
Liquidity Facility Provider to sub-contract an obligation if the
Funding 1 Liquidity Facility Provider remains primarily liable under
this Agreement for that obligation.
24.5 ASSIGNMENTS AND TRANSFERS REQUIRED BY FUNDING 1
(a) If:
(i) Funding 1 is, or will be, required to pay to the Funding 1
Liquidity Facility Provider a Tax Payment or an Increased Cost or
a Relevant Event has occurred; and
(ii) Funding 1 has not cancelled the Funding 1 Liquidity Facility
Commitment in whole pursuant to CLAUSE 7.2 (Voluntary and
Cancellation),
then Funding 1 may by notice to the Funding 1 Liquidity Facility
Provider, require the Funding 1 Liquidity Facility Provider to novate
(at the cost of Funding 1) its rights and obligations under this
Agreement to a new liquidity facility provider which is a Qualifying
Lender and has the Requisite Ratings in such manner as is required by
Funding 1 and approved by the Security Trustee.
(b) A condition precedent to any novation by the Funding 1 Liquidity
Facility Provider under this CLAUSE 24.5, is that the Funding 1
Liquidity Facility Provider has been repaid all amounts outstanding to
it under this Agreement.
(c) A novation will be effective only if the Funding 1 Liquidity Facility
Provider and the New Liquidity Facility Provider deliver to Funding 1
and the Security Trustee a duly completed certificate, substantially in
the form of Schedule 4 (Form of Novation Certificate) and each of
Funding 1 and the Security Trustee executes the certificate to confirm
its consent to the transfer. On the transfer becoming effective in this
manner the Funding 1 Liquidity Facility Provider will be released from
its obligations under this Agreement to the extent that they are
transferred to the New Liquidity Facility Provider.
30
(d) If there is any conflict between Funding 1's rights under paragraph (a)
above and the Funding 1 Liquidity Facility Provider's rights under
Sub-clause 24.4 (Transfers by the Funding 1 Liquidity Facility
Provider), then the views of Funding 1 will prevail with the result
that if each of Funding 1 and the Funding 1 Liquidity Facility Provider
had selected a New Liquidity Facility Provider, or wished to adopt a
different approach under paragraph (a) above or Sub-clause 24.4, as
appropriate, the selection and/or the approach to be adopted will be
that selected or adopted (as the case may be) by Funding 1.
24.6 COSTS RESULTING FROM CHANGE OF LIQUIDITY FACILITY PROVIDER OR FACILITY
OFFICE
If:
(a) the Funding 1 Liquidity Facility Provider assigns or transfers
any of its rights and obligations under the Funding 1 Liquidity
Documents under Sub-clause 24.4 (Transfers by the Funding 1
Liquidity Facility Provider) or changes its facility office; and
(b) as a result of circumstances existing at the date the assignment,
transfer or change occurs, Funding 1 would be obliged to pay a
Tax Payment or an Increased Cost,
then, unless the assignment, transfer or change is made by the Funding
1 Liquidity Facility Provider to mitigate any circumstances giving rise
to the Tax Payment, Increased Cost or a right to be prepaid and/or
cancelled by reason of illegality, Funding 1 is only obliged to pay
that Tax Payment or Increased Cost to the same extent that it would
have been obliged to make such a payment to the Funding 1 Liquidity
Facility Provider if no assignment, transfer or change had occurred.
25. DISCLOSURE OF INFORMATION
The Funding 1 Liquidity Facility Provider may disclose to any person
with whom it is proposing to enter, or has entered into, any kind of
transfer, participation or other agreement in relation to this
Agreement:
(a) a copy of any Funding 1 Liquidity Document; and
(b) any information which the Funding 1 Liquidity Facility Provider
has acquired under or in connection with any Funding 1 Liquidity
Document,
if that person undertakes to Funding 1 and the Security Trustee to keep
the information confidential.
26. SET-OFF
(a) The Funding 1 Liquidity Facility Provider undertakes with Funding 1 and
the Security Trustee not to exercise or claim any right of set-off or
combination or consolidation of accounts in respect of any account of
Funding 1 with the Funding 1 Liquidity Facility Provider and/or
interest accruing on amounts in any such account or any part of such
account in or towards, or conditionally upon satisfaction of any
liabilities to the Funding 1 Liquidity Facility Provider of Funding 1
or itself in any other capacity whatsoever or any other person.
(b) In the event that the Funding 1 Liquidity Facility Provider (in breach
of its undertaking in PARAGRAPH (A) above) exercises any right of
set-off or combination or consolidation of accounts, the Funding 1
Liquidity Facility Provider shall pay to Funding 1 such additional
amount so that the net amount received by Funding 1 will equal the full
amount which would
31
have been received by it if the Funding 1 Liquidity Facility Provider
had not exercised or claimed such right of set-off or combination or
consolidation of accounts.
27. SEVERABILITY
If a provision of any Funding 1 Liquidity Document is or becomes
illegal, invalid or unenforceable in any jurisdiction, that shall not
affect:
(a) the legality, validity or enforceability in that jurisdiction of
any other provision of the Funding 1 Liquidity Documents; or
(b) the legality, validity or enforceability in other jurisdictions
of that or any other provision of the Funding 1 Liquidity
Documents.
28. 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.
29. NOTICES
29.1 GIVING OF NOTICES
Any notice, communication or demand made under or in connection with
this Agreement shall be in writing and shall be delivered personally,
or by post, fax or cable to the addresses given in CLAUSE 29.2
(Addresses for notices) or at such other address as the recipient may
have notified to the other party in writing. Proof of posting or
despatch of any notice or communication shall be deemed to be proof of
receipt:
(a) in the case of a letter, on the third business day after posting;
and
(b) in the case of a facsimile on the business day of despatch.
29.2 ADDRESSES FOR NOTICES
The addresses referred to in this CLAUSE 29 (Notices) are as follows:
(a) in the case of Funding 1, to Permanent Funding (No. 1) Limited at
Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (facsimile
number x00 (0) 00 0000 0000) for the attention of the Secretary
with a copy to HBOS Treasury Services plc, 00 Xxx Xxxxx Xxxxxx,
Xxxxxx XX0X 0XX (facsimile no. x00 (0) 00 0000 0000) for the
attention of Head of Mortgage Securitisation and Covered Bonds;
(b) in the case of the Cash Manager, to Halifax plc at Xxxxxxx Xxxx,
Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (LP/3/3/SEC) (facsimile number
x00 (0) 000 000 0000) for the attention of Head of Mortgage
Securitisation with a copy to HBOS Treasury Services plc, 00 Xxx
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile no. +44 (0) 20 7574
8303) for the attention of Head of Mortgage Securitisation and
Covered Bonds;
32
(c) in the case of the Security Trustee, to The Bank of Xxx Xxxx, Xxx
Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile number + 44 (020) 7964
6061/6399) for the attention of Corporate Trust Services; and
(d) in the case of the Funding 1 Liquidity Facility Provider, to
JPMorgan Chase Bank, N.A., 000 Xxxxxx Xxxx, Xxxxxx XX0X 0XX
(facsimile no. x00 00 0000 0000/5311) for the attention of
European Loans,
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 29.
30. THIRD PARTY RIGHTS
A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of
this Agreement, but this does not affect any right or remedy of a third
party which exists or is available apart from that Act.
31. GOVERNING LAW
This Agreement is governed by and construed in accordance with English
law.
32. SUBMISSION TO JURISDICTION
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.
This Agreement has been entered into on the date stated at the beginning of this
Agreement.
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SCHEDULE 1
CONDITIONS PRECEDENT DOCUMENTS
1. A copy of the memorandum and articles of association and certificate of
incorporation of Funding 1.
2. A copy of a resolution of the board of directors of Funding 1:
(a) approving the terms of, and the transactions contemplated by,
this Agreement and resolving that it execute this Agreement;
(b) authorising a specified person or persons to execute this
Agreement on its behalf; and
(c) authorising a specified person or persons, on its behalf, to sign
and/or despatch all other documents and notices to be signed
and/or despatched by it under or in connection with this
Agreement.
3. A specimen of the signature of each person authorised by the resolution
referred to in PARAGRAPH 2 above.
4. A certificate of an authorised signatory of Funding 1 certifying that
each copy document specified in this SCHEDULE 1 is correct, complete
and in full force and effect as at a date no earlier than the date of
this Agreement.
5. The Transaction Documents.
6. Confirmation from Xxxxxxxx Chance LLP as legal counsel to the Security
Trustee that they have received, on behalf of the Security Trustee, a
transaction legal opinion from Xxxxx & Overy LLP.
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SCHEDULE 2
CALCULATION OF THE MANDATORY LIQUID ASSET COST
(a) For the purposes of PARAGRAPH (A) of the definition of Mandatory Liquid
Asset Cost, the Mandatory Liquid Asset Cost for a Funding 1 Liquidity
Facility Loan or a Funding 1 Liquidity Facility Stand-by Loan for its
Funding 1 Liquidity Facility Interest Period is the rate determined by
the Funding 1 Liquidity Facility Provider (rounded upward, if
necessary, to four decimal places) calculated in accordance with the
following formulae:
BY+S(Y-Z)+Fx(0.01)
------------------ % per annum = Mandatory Liquid Asset Cost
100-(B+S)
where on the day of application of the formula:
B is the percentage of the Funding 1 Liquidity Facility Provider's
eligible liabilities (in excess of any stated minimum) which the
Bank of England requires the Funding 1 Liquidity Facility
Provider to hold on a non-interest-bearing deposit account in
accordance with its cash ratio requirements;
Y is the applicable LIBOR for that Funding 1 Liquidity Facility
Provider;
S is the percentage of the Funding 1 Liquidity Facility Provider's
eligible liabilities which the Bank of England requires the
Funding 1 Liquidity Facility Provider to place as a special
deposit;
Z is the lower of Y and the interest rate per annum paid by the
Bank of England on special deposits; and
F is the charge payable by the Funding 1 Liquidity Facility
Provider to the Financial Services Authority under the fees rules
(but, for this purpose, calculated by the Funding 1 Liquidity
Facility Provider on a notional basis as being the average of the
fee tariffs within fee block Category A1 (Deposit acceptors) of
the fees rules, applying any applicable discount and ignoring any
minimum fee required under the fees rules) and expressed in
pounds per (pound)1 million of the tariff base of the Funding 1
Liquidity FacILITY Provider.
(b) For the purposes of this Schedule 2:
(i) ELIGIBLE LIABILITIES and SPECIAL DEPOSITS have the meanings given
to them at the time of application of the formula under or
pursuant to the Bank of Xxxxxxx Xxx 0000 or by the Bank of
England; and
(ii) FEE BASE means the then current rules on periodic fees in the
Supervision Manual of the FSA Handbook; and
(iii) TARIFF BASE has the meaning given to it in the fees rules.
(c) In the application of the formula, B, Y, S and Z are included in the
formula as figures and not as percentages, e.g. if B = 0.5% and Y =
15%, BY is calculated as 0.5 x 15. A negative result obtained by
subtracting Z from Y is taken as zero.
35
(d) (i) Each formula is applied on the first day of the relevant
Funding 1 Liquidity Interest Period.
(ii) Each rate calculated in accordance with the formula is, if
necessary, rounded upward to four decimal places.
(iii) If the formula produces a negative percentage, the percentage
shall be taken as zero.
(e) If the Funding 1 Liquidity Facility Provider determines, after
consultation with Funding 1 that a change in circumstances has
rendered, or will render, the formula inappropriate, the Funding 1
Liquidity Facility Provider shall notify Funding 1 of the manner in
which the Mandatory Liquidity Asset Cost will subsequently be
calculated. The manner of calculation so notified by the Funding 1
Liquidity Facility Provider shall, in the absence of manifest error, be
binding on all the parties.
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SCHEDULE 3
FORM OF FUNDING 1 LIQUIDITY FACILITY REQUEST
To: JPMorgan Chase Bank, N.A. as Funding 1 Liquidity Facility Provider
Copy: The Bank of New York (as Security Trustee)
From: Permanent Funding (No. 1) Limited
Date:[ ]
PERMANENT FUNDING (NO. 1) LIMITED
(POUND)[O,000,000] FUNDING 1 LIQUIDITY FACILITY AGREEMENT
(AS AMENDED AND/OR RESTATED FROM TIME TO TIME)
1. We wish to borrow a Funding 1 Liquidity [Facility Drawing/Facility
Stand-by Drawing] as follows:
(a) Funding 1 Liquidity Facility Drawdown Date: [ ]
(b) Funding 1 Liquidity Facility
(c) Amount: (pound)[ ]
(d) Payment Instructions: [ ].**
(e) Term of Funding 1 Liquidity [Facility Drawing/Facility Stand-by
Drawing]: [ ]
2. We confirm that each condition specified in CLAUSE 4.2 (Further
conditions precedent) is satisfied on the date of this Funding 1
Liquidity Facility Request.
3. We confirm that the Funding 1 Liquidity Facility Drawing is to be used
for one of the purposes specified in CLAUSE 3 (Purpose).
By:
PERMANENT FUNDING (NO. 1) LIMITED
Authorised Signatory
--------
** This will be the Funding 1 Liquidity Facility Stand-by Account if this is
a Funding 1 Liquidity Facility Stand-by Drawing.
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SCHEDULE 4
FORM OF NOVATION CERTIFICATE
To: [The Bank of New York] (as Security Trustee)
From: [THE EXISTING FUNDING 1 LIQUIDITY FACILITY PROVIDER] and [THE NEW
FUNDING 1 LIQUIDITY FACILITY PROVIDER]
Date: [ ]
PERMANENT FUNDING (NO. 1) LIMITED
(POUND)[O,000,000] FUNDING 1 LIQUIDITY FACILITY AGREEMENT AS AMENDED
AND/OR RESTATED FROM TIME TO TIME) (the AGREEMENT)
We refer to [CLAUSE 24.4 (Transfers by Funding 1 Liquidity Facility
Provider]/[CLAUSE 24.5 (Assignments and transfers required by Funding 1)].
1. We JPMorgan Chase Bank, N.A. (the EXISTING FUNDING 1 LIQUIDITY FACILITY
PROVIDER) and [ ] (the NEW FUNDING 1 LIQUIDITY FACILITY PROVIDER) agree
to the Existing Funding 1 Liquidity Facility Provider and the New
Funding 1 Liquidity Facility Provider novating all the Existing Funding
1 Liquidity Facility Provider's FUNDING 1 LIQUIDITY Facility Commitment
(or part) and/or rights and obligations referred to in the Schedule in
accordance with [CLAUSE 24.4 (Transfers by Funding 1 Liquidity Facility
Provider]/[CLAUSE 24.5 (Assignments and transfers required by Funding
1)]. Terms used but not defined herein have the meaning assigned to
them in the Agreement.
2. The specified date for the purposes of [CLAUSE 24.4 (Transfers by
Funding 1 Liquidity Facility Provider]/[CLAUSE 24.5 (Assignments and
transfers required by Funding 1)] is [date of novation].
3. The New Funding 1 Liquidity Facility Provider makes the representations
and warranties to be made by it in accordance with CLAUSE 14
(Representations and warranties) as at [date of novation].
4. The Existing Funding 1 Liquidity Facility Provider is not responsible
to a New Funding 1 Liquidity Facility Provider for:
(a) the execution, genuineness, validity, enforceability or
sufficiency of any Funding 1 Liquidity Document or any other
document;
(b) the collectability of amounts payable under any Funding 1
Liquidity Document; or
(c) the accuracy of any statements (whether written or oral) made in
or in connection with any Funding 1 Liquidity Document.
5. The New Funding 1 Liquidity Facility Provider confirms to the Existing
Funding 1 Liquidity Facility Provider and the other Finance Parties
that it:
(a) has made its own independent investigation and assessment of the
financial condition and affairs of each of Funding 1 and its
related entities in connection with its participation in this
Agreement and has not relied exclusively on any information
provided to it by the Existing Funding 1 Liquidity Facility
Provider in connection with any Funding 1 Liquidity Document; and
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(b) will continue to make its own independent appraisal of the
creditworthiness of each of Funding 1 and its related entities
while any amount is or may be outstanding under this Agreement or
any Funding 1 Liquidity Facility Commitment is in force.
6. Nothing in any Funding 1 Liquidity Document obliges the Existing
Funding 1 Liquidity Facility Provider to:
(a) accept a re-transfer from a New Funding 1 Liquidity Facility
Provider of the Funding 1 Liquidity Facility Commitment and/or
rights and/or obligations assigned, transferred or novated under
this Clause; or
(b) support any losses incurred by the New Funding 1 Liquidity
Facility Provider by reason of the non-performance by Funding 1
of its obligations under this Agreement or otherwise.
7. The address for notices of the New Funding 1 Liquidity Facility
Provider for the purposes of CLAUSE 29.2 (Addresses for notices) is set
out in the Schedule to this Novation Certificate.
8. This Novation Certificate is governed by English law.
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THE SCHEDULE
FUNDING 1 LIQUIDITY FACILITY COMMITMENT AND RIGHTS
AND OBLIGATIONS TO BE NOVATED
[insert relevant details]
[NEW FUNDING 1 LIQUIDITY FACILITY PROVIDER]
[Address for notices]
[Existing Funding 1 [New Funding 1 Liquidity [SECURITY TRUSTEE]
Liquidity Facility Provider] Facility Provider]
By: By: By:
Date: Date: Date:
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SIGNATORIES
FUNDING 1
SIGNED by )
for and on behalf of )
PERMANENT FUNDING (NO. 1) LIMITED )
FUNDING 1 LIQUIDITY FACILITY PROVIDER
SIGNED by )
for and on behalf of )
JPMORGAN CHASE BANK, N.A. )
CASH MANAGER
SIGNED by )
for and on behalf of )
HALIFAX PLC )
SECURITY TRUSTEE
SIGNED by )
for and on behalf of )
THE BANK OF NEW YORK )
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