Exhibit 4.2
EXECUTION COPY
AMENDED AND RESTATED MORTGAGES TRUST DEED
DATED 8 DECEMBER, 2005
ABBEY NATIONAL PLC
AND
XXXXXX FUNDING LIMITED
AND
XXXXXX TRUSTEES LIMITED
AND
SPV MANAGEMENT LIMITED
XXXXX & XXXXX
XXXXX & XXXXX LLP
LONDON
03 January 2006
CONTENTS
CLAUSE PAGE
1. Definitions and Construction.........................................................................2
2. Creation of Mortgages Trust..........................................................................2
3. Conditions Precedent.................................................................................3
4. Acquisition by Funding of an Increased Interest in the Trust Property................................3
5. Acquisition by Seller of an Interest Relating to Capitalised Interest................................5
6. Payment by the Seller to Funding of the amount outstanding under an Intercompany Loan................6
7. Initial Funding Share and Initial Seller Share.......................................................7
8. Adjustment of Funding Share Percentage and Seller Share Percentage on Distribution Dates.............7
9. Minimum Seller Share................................................................................10
10. Allocation and Distribution of Revenue Receipts.....................................................11
11. Allocation and Distribution of Principal Receipts...................................................12
12. Allocation of Losses................................................................................15
13. Ledgers.............................................................................................15
14. Costs and Expenses of the Mortgages Trustee.........................................................15
15. Directions from Beneficiaries.......................................................................16
16. Early Termination of the Mortgages Trust............................................................16
17. Transfers...........................................................................................17
18. Covenants of the Mortgages Trustee..................................................................17
19. Power to Delegate...................................................................................18
20. Powers of Investment................................................................................19
21. Other Provisions Regarding the Mortgages Trustee....................................................19
22. No Retirement of Mortgages Trustee..................................................................20
23. Termination.........................................................................................20
24. Further Assurances..................................................................................20
25. Amendments, Etc.....................................................................................20
26. Non Petition Covenant...............................................................................21
27. No Partnership or Agency............................................................................21
28. Calculations........................................................................................21
29. No Waiver; Remedies.................................................................................21
30. Severability........................................................................................21
31. Confidentiality.....................................................................................21
32. Exclusion of Third Party Rights.....................................................................22
33. Addresses for Notices...............................................................................22
34. Governing Law and Submission to Jurisdiction........................................................23
THIS AMENDED AND RESTATED MORTGAGES TRUST DEED is made on 8 December 2005
BETWEEN:
(1) ABBEY NATIONAL PLC (registered number 2294747), a public limited
company incorporated under the laws of England and Wales whose
registered office is at Abbey National House, 0 Xxxxxx Xxxxxx, Xxxxxx'x
Xxxxx, Xxxxxx XX0 0XX in its capacity as Seller, Beneficiary and Cash
Manager;
(2) XXXXXX FUNDING LIMITED (registered number 3982428), a private limited
company incorporated under the laws of England and Wales whose
registered office is at Abbey National House, 0 Xxxxxx Xxxxxx, Xxxxxx'x
Xxxxx, Xxxxxx XX0 0XX in its capacity as a Beneficiary;
(3) XXXXXX TRUSTEES LIMITED (registered number 3982431), a private limited
company incorporated under the laws of England and Wales whose
registered office is at Abbey National House, 0 Xxxxxx Xxxxxx, Xxxxxx'x
Xxxxx, Xxxxxx XX0 0XX in its capacity as Mortgages Trustee; and
(4) SPV MANAGEMENT LIMITED (registered number 2548079), a private limited
company incorporated under the laws of England and Wales whose
registered office is at Tower 42, International Finance Centre, 00 Xxx
Xxxxx Xxxxxx, Xxxxxx XX0X 0XX.
WHEREAS:
(A) SPV Management agreed to constitute the Mortgages Trust in
favour of Funding and the Seller on the terms and subject to
the conditions set out in the Mortgages Trust Deed dated 25th
July, 2000 (as amended and/or restated from time to time, the
MORTGAGES TRUST DEED).
(B) The Mortgages Trustee agreed to hold the Trust Property as
trustee for the Beneficiaries upon, with and subject to the
trusts, powers and provisions of the Mortgages Trust Deed.
(C) The Seller carries on the business of, inter alia, originating
residential first mortgage loans to individual Borrowers in
England, Wales and Scotland and of managing and administering
such mortgage loans. The Seller assigned an initial portfolio
of such mortgage loans on 26th, July 2000 and new portfolios
of such mortgages loans on subsequent dates to the Mortgages
Trustee pursuant to the Mortgage Sale Agreement, which
portfolio is held by the Mortgages Trustee as trustee for the
Beneficiaries upon, with and subject to the trusts, powers and
provisions of the Mortgages Trust Deed.
(D) On 29th November, 2000 the parties to the Mortgages Trust Deed
agreed to amend the terms of the Mortgages Trust Deed as set
out in an Amendment Agreement to the Mortgages Trust Deed to
provide for repayment by Funding of its obligations in respect
of certain term advances known as Scheduled Amortisation Term
Advances.
(E) On 23rd May, 2001 the parties to the Mortgages Trust Deed
again agreed to amend the terms of the Mortgages Trust Deed as
set out in the Second Deed of Amendment to the Mortgages Trust
Deed to exclude application of the Trustee Xxx 0000.
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(F) On 5th July, 2001 the parties to the Mortgages Trust Deed
agreed to amend and restate the terms of the Mortgages Trust
Deed as set out in the Amended and Restated Mortgages Trust
Deed of the same date.
(G) On 8th November, 2001 the parties to the Mortgages Trust Deed
agreed to amend and restate the terms of the Mortgages Trust
Deed as set out in the Amended and Restated Mortgages Trust
Deed of the same date.
(H) On 7th November, 2002 the parties to the Mortgages Trust Deed
agreed to amend and restate the terms of the Mortgages Trust
Deed as set out in the Amended and Restated Mortgages Trust
Deed of the same date.
(I) On 26th March, 2003 the parties to the Mortgages Trust Deed
agreed to amend and restate the terms of the Mortgages Trust
Deed as set out in the Amended and Restated Mortgages Trust
Deed of the same date.
(J) On 1st April, 2004 the parties to the Mortgages Trust Deed
agreed to amend and restate the terms of the Mortgages Trust
Deed as set out in the Amended and Restated Mortgages Trust
Deed of the same date.
(K) The parties to the Mortgages Trust Deed have again agreed to
amend and restate the terms of the Mortgages Trust Deed as set
out herein.
NOW THIS DEED WITNESSES:
1. DEFINITIONS AND CONSTRUCTION
1.1 The Amended and Restated Master Definitions and Construction Schedule
signed for the purposes of identification by Xxxxx & Xxxxx LLP and
Xxxxxxxxx and May on 8 December 2005 (as the same may be amended,
varied or supplemented from time to time with the consent of the
parties hereto) is expressly and specifically incorporated into this
Agreement and, accordingly, the expressions defined in the Amended and
Restated Master Definitions and Construction Schedule (as so amended,
varied or supplemented) 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 that Amended and Restated Master
Definitions and Construction Schedule.
1.2 This Deed amends and restates the Mortgages Trust Deed made on 25th
July, 2000 between the parties hereto as amended on 29th November, 2000
and 23rd May, 2001 and amended and restated on 5th July, 2001, 8th
November, 2001, 7th November, 2002, 26th March, 2003 and 1st April,
2004 (the PRINCIPAL DEED). As of the date of this Deed, any future
rights or obligations (excluding such obligations accrued to the date
of this Deed) of a party under the Principal Deed shall be extinguished
and shall instead be governed by this Deed.
2. CREATION OF MORTGAGES TRUST
2.1 INITIAL TRUST PROPERTY
On 25th July, 2000 SPV Management settled on trust the sum of
(pound)100 (one hundred pounds) (the INITIAL TRUST PROPERTY) to be held
on trust absolutely as to both capital and income by the Mortgages
Trustee for the benefit, as tenants in common, of the Seller as to the
Initial Seller Share Percentage and Funding as to the Initial Funding
Share Percentage.
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2.2 INITIAL CLOSING TRUST PROPERTY
Pursuant to the provisions of the Mortgage Sale Agreement, the Seller
assigned the Initial Closing Trust Property on the Initial Closing
Date.
2.3 FUTURE TRUST PROPERTY
From time to time and pursuant to the Mortgage Sale Agreement, the
Seller has assigned and intends to assign Future Trust Property to the
Mortgages Trustee.
2.4 TRUST PROPERTY
Subject to Clause 3, the Mortgages Trustee shall hold the Trust
Property as to both capital and income on trust absolutely for Funding
(as to the Funding Share) and for the Seller (as to the Seller Share)
as tenants in common upon, with and subject to all the trusts, powers
and provisions of this Deed.
3. CONDITIONS PRECEDENT
3.1 The Initial Trust Property is held by the Mortgages Trustee on the
Mortgages Trust.
3.2 The Initial Closing Trust Property shall be held by the Mortgages
Trustee on the Mortgages Trust upon the satisfaction of the following
conditions precedent:
(a) due execution and delivery of the Mortgage Sale Agreement by
all parties to it;
(b) due execution and delivery of this Deed by all parties to it;
and
(c) payment by Funding to the Seller of the Initial Consideration.
3.3 Any Future Trust Property shall be held by the Mortgages Trustee on the
Mortgages Trust subject to satisfaction of the conditions set out in
Clause 4.1 of the Mortgage Sale Agreement for the transfer of New Loans
and their New Related Security to the Mortgages Trustee.
4. ACQUISITION BY FUNDING OF AN INCREASED INTEREST IN THE TRUST PROPERTY
4.1 OFFER TO ASSIGN AND CONDITIONS TO ASSIGNMENT
On not more than 60 nor less than 30 days' written notice, Funding may
offer to make a payment to the Seller to acquire an interest in the
Trust Property with the effect of increasing the Funding Share on the
Distribution Date specified in that notice. Such offer shall only be
valid if the following conditions precedent are satisfied on the
Distribution Date:
(a) the Principal Deficiency Ledger does not have a debit balance
(which remains outstanding) as at the most recent Interest
Payment Date;
(b) no Note Event of Default or Intercompany Loan Event of Default
shall have occurred which is continuing or unwaived as at the
relevant Distribution Date;
(c) the Security Trustee is not aware that the proposed
acquisition would adversely affect the then current credit
ratings by the Rating Agencies (or any of them) of the Notes;
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(d) the relevant Notes have been issued by the relevant Issuer,
the subscription proceeds received on behalf of the relevant
Issuer and advanced by the relevant Issuer to Funding pursuant
to an Intercompany Loan Agreement, the proceeds of which will
be applied by Funding to make the payment referred to in the
notice on the relevant Distribution Date;
(e) Funding has entered into, if necessary, a New Start-up Loan,
any new variable rate swap, new fixed floating rate swap and a
new tracker rate swap and adjustments have been made, if
required, to the First Reserve Fund and the Second Reserve
Fund;
(f) receipt of a solvency certificate from the Seller in form and
content acceptable to the Mortgages Trustee, Funding and the
Security Trustee;
(g) as at the relevant Distribution Date, the aggregate
Outstanding Principal Balance of Loans constituting the Trust
Property, in respect of which the aggregate amount in arrear
is more than three times the monthly payment then due, is less
than 4 per cent. of the aggregate Outstanding Principal
Balance of all Loans constituting the Trust Property;
(h) unless otherwise agreed by Xxxxx'x, Standard and Poor's or
Fitch, as the case may be, the short term, unsecured,
unguaranteed and unsubordinated debt obligations of the Seller
are rated at least P-1 by Xxxxx'x, A-1 by Standard and Poor's
and F1 by Fitch at the time of, and immediately following, the
proposed acquisition;
(i) the product of the WAFF and WALS for the Loans constituting
the Trust Property calculated on the relevant Distribution
Date in the same way as for the Initial Portfolio (or as
agreed by the Servicer and the Rating Agencies from time to
time) does not exceed the product of the WAFF and WALS for the
Loans constituting the Trust Property calculated on the most
recent previous Closing Date, plus 0.25 per cent.;
(j) the loan-to-value ratio of Loans in the Trust Property, after
application of the LTV Test on the relevant Distribution Date,
does not exceed the loan-to-value ratio (based on the LTV
Test) of Loans in the Trust Property on the most recent
previous Closing Date plus 0.25 per cent.; and
(k) the First Reserve Fund has not been debited on or before the
relevant Distribution Date for the purposes of curing a
Principal Deficiency in respect of the Term Advances in
circumstances where the First Reserve Fund has not been
replenished by a corresponding amount by the relevant
Distribution Date.
Funding may not offer to make a payment to the Seller in consideration
for an increase in the Funding Share after any Interest Payment Date on
which any Issuer (including any New Issuer) does not exercise its
option to redeem the Notes or any New Notes issued by it pursuant to
the Terms and Conditions of such Notes or, as the case may be, any New
Notes (but only where such right of redemption arises on or after a
particular specified date and not as a result of the occurrence of any
event specified in the Terms and Conditions).
4.2 COMPLETION OF ASSIGNMENT
Subject to satisfaction of the conditions precedent set out in Clause
4.1 above and to acceptance of that offer by the Seller, Funding shall
pay to the Seller an amount equal to the increase in the Funding Share
of the Trust Property and the Funding Share of the Trust
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Property shall increase by a corresponding amount, and the Seller Share
shall decrease by the same amount.
4.3 AUDIT OF LOANS CONSTITUTING THE TRUST PROPERTY
If the short term, unsecured, unguaranteed and unsubordinated debt
obligations of the Seller fall below A-1 by Standard & Poor's, P-1 by
Xxxxx'x and/or F1 by Fitch, then the Beneficiaries shall appoint a firm
of independent auditors (approved by the Rating Agencies) to determine
whether the Loans and their Related Security (or any part of them)
constituting the Trust Property complied with the representations and
warranties set out in Schedule 1 of the Mortgage Sale Agreement as at
the date such Loans were assigned to the Mortgages Trustee. The costs
of such independent auditors shall be borne by the Beneficiaries pro
rata according to their respective current percentage shares in the
Trust Property.
4.4 TAX
(a) Any payment by Funding to the Seller to acquire an interest in the
Trust Property shall be inclusive of any amount in respect of
applicable VAT (if any).
(b) Any stamp duty or stamp duty reserve tax in respect of any acquisition
of Trust Property shall be payable by the Seller.
5. ACQUISITION BY SELLER OF AN INTEREST RELATING TO CAPITALISED INTEREST
5.1 Any increase in the Outstanding Principal Balance due to Capitalised
Interest will be allocated to the Funding Share of the Trust Property
and to the Seller Share of the Trust Property, based on respectively
the Funding Share Percentage and the Seller Share Percentage in the
Trust Property as calculated on the previous Distribution Date.
5.2 Prior to an Insolvency Event occurring in respect of the Seller, on
each Distribution Date the Seller shall make a cash payment to Funding
in an amount equal to Funding's share of the Capitalised Interest
arising since the last Distribution Date in respect of those Loans that
are subject to Payment Holidays or Underpayments. In consideration for
the making of such payment the Seller Share of the Trust Property will
increase by an amount equal to the amount paid to Funding for Funding's
share of the Capitalised Interest, and the Funding Share will decrease
by a corresponding amount. The cash payment shall be made in accordance
with Clause 5.4 below.
5.3 If an Insolvency Event occurs in respect of the Seller, then the Seller
may make payment to Funding in respect of its share of the Capitalised
Interest in the same manner as is contemplated in Clause 5.2, but it is
not obliged to do so.
5.4 In respect of the cash payment to be made by the Seller pursuant to
Clause 5.2, the Seller hereby directs the Mortgages Trustee to deduct
from the Seller's share of the Mortgages Trust Available Revenue
Receipts (allocated to the Seller pursuant to Clause 10.2 of this Deed)
an amount equal to such cash payment and to pay the same to Funding in
satisfaction of the Seller's obligations under Clause 5.2. To the
extent that the Seller's share of the Mortgages Trust Available Revenue
Receipts is less than the amount required to be paid by it pursuant to
Clause 5.2, then the Seller shall pay an amount equal to the shortfall
directly to Funding from its own resources.
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5.5 Any payment by the Seller pursuant to Clause 5.2 shall be exclusive of
any amount in respect of applicable VAT (which shall be paid by the
Seller in addition to payments made pursuant to Clause 5.2).
6. PAYMENT BY THE SELLER TO FUNDING OF THE AMOUNT OUTSTANDING UNDER AN
INTERCOMPANY LOAN
6.1 CONDITIONS PRECEDENT TO ACCEPTANCE OF OFFER
Funding may accept any offer by the Seller to pay the amount
outstanding under any Series of Term Advances under an Intercompany
Loan, but only if:
(a) either:
(i) the Outstanding Principal Balance of the relevant
Series of Term Advances under the Intercompany Loan
is less than 10 per cent. of the Outstanding
Principal Balance of the Term Advances of that Series
immediately after the Term Advances were drawn; or
(ii) (A) an Issuer would be required to deduct or withhold
from any payment of principal or interest or any
other amount under any of the Issuer Notes any amount
for or on account of any present or future taxes,
duties, assessments or governmental charges of
whatever nature, or (B) Funding would be required to
deduct or withhold from amounts due under an
Intercompany Loan any amount on account of any
present or future taxes, duties, assessments or
governmental charges of whatever nature, and that
Issuer is not able to arrange the substitution of a
company incorporated in another jurisdiction approved
by the relevant Note Trustee as principal debtor
under the relevant Notes and as lender under the
relevant Issuer Intercompany Loan Agreement, as the
case may be; or
(iii) an Issuer has delivered a certificate to Funding,
the relevant Issuer Security Trustee and the Rating
Agencies to the effect that it would be unlawful for
that Issuer to make, fund or allow to remain
outstanding a Term Advance made by it under the
relevant Intercompany Loan Agreement and stating
that that Issuer requires Funding to prepay the Term
Advance; or
(iv) (in relation to the Seventh Issuer Intercompany Loans
and the Eighth Issuer Intercompany Loans only) the
new Basel Capital Accord (as described in the
consultative document "The New Basel Capital Accord"
published in April 2003 by the Basel Committee on
Banking Supervision) has been implemented in the
United Kingdom, whether by the rule of law,
recommendation of best practices or by any other
regulation, no Seventh Issuer Note Enforcement Notice
or Eighth Issuer Note Enforcement Notice has been
served, the offer by the Seller is made on or after
the Interest Payment Date falling in April 2007 and
the Seller has given not more than 60 days, and not
less than 30 days, notice of making an offer;
(b) the Security Trustee has received written confirmation from
each of the Rating Agencies that there would not be any
adverse effect on the then current ratings of the Notes if
Funding accepted the offer;
(c) Funding would receive the payment from the Seller on a
Distribution Date (together with VAT, if payable); and
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(d) Funding will, and is entitled under the terms of that
Intercompany Loan to, apply the proceeds of the payment to
repay the relevant Series of Term Advances under that
Intercompany Loan and the relevant Issuer has confirmed to
Funding that on the next succeeding Interest Payment Date for
the corresponding classes of Notes it will use the proceeds
of the relevant payment to repay the corresponding classes of
Notes and that Issuer has exercised its option to redeem the
corresponding classes of Notes.
6.2 ADJUSTMENT TO SHARES IF OFFER ACCEPTED
If Funding accepts the offer as described in Clause 6.1 above, then the
Funding Share of the Trust Property shall decrease by an amount
corresponding to the amount paid by the Seller and the Seller Share of
the Trust Property shall increase by the same amount.
7. INITIAL FUNDING SHARE AND INITIAL SELLER SHARE
7.1 INITIAL FUNDING SHARE
The INITIAL FUNDING SHARE of the Trust Property was (pound)35.25 at
25th July, 2000 and (pound)2,256,000,035.25 at the Initial Closing Date
and the INITIAL FUNDING SHARE PERCENTAGE was the Initial Funding Share
expressed as a percentage of the Trust Property at such date, that is
to say, 35.25 per cent..
7.2 INITIAL SELLER SHARE
The INITIAL SELLER SHARE of the Trust Property was the sum which
remained of the Trust Property after deduction of the Initial Funding
Share. As at 25th July, 2000, the Initial Seller Share was (pound)64.75
and the INITIAL SELLER SHARE PERCENTAGE was equal to 100 per cent.
minus the Initial Funding Share Percentage, that is to say, 64.75 per
cent. The amount of the Initial Seller Share and the Initial Seller
Share Percentage on the Initial Closing was determined immediately
after the Initial Closing Date.
7.3 ROUNDING OF PERCENTAGE SHARES
Except for the Initial Closing Date (and unless otherwise agreed by the
Beneficiaries), the Funding Share Percentage and the Seller Share
Percentage shall be calculated to five decimal places.
8. ADJUSTMENT OF FUNDING SHARE PERCENTAGE AND SELLER SHARE PERCENTAGE ON
DISTRIBUTION DATES
8.1 DISTRIBUTION
On each Distribution Date, excluding, for the avoidance of doubt, the
Initial Closing Date, the Funding Share Percentage and the Seller Share
Percentage will be recalculated by the Cash Manager (on behalf of the
Mortgages Trustee and the Beneficiaries) based on the aggregate
Outstanding Principal Balance of the Loans constituting the Trust
Property (as adjusted from time to time) on the second London Business
Day immediately preceding that Distribution Date. On each Distribution
Date, the Mortgages Trustee will distribute Revenue Receipts and
Principal Receipts in accordance with Clauses 10 and 11 hereof.
8.2 CURRENT FUNDING SHARE PERCENTAGE
On each Distribution Date and the date when the Mortgages Trust
terminates (in each case the RELEVANT DISTRIBUTION DATE), the CURRENT
FUNDING SHARE PERCENTAGE will be an amount,
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expressed as a percentage (calculated to an accuracy of three decimal
places (rounded upwards)), equal to:
A - B - C + D + E + F
_____________________ x 100
G
where:
A = the Current Funding Share as at the immediately preceding
Distribution Date (or, in the case of the first Distribution Date, the
Initial Funding Share as at the Initial Closing Date);
B = the amount of any Principal Receipts distributed to Funding on that
Relevant Distribution Date in accordance with the provisions described
in Clause 11 below;
C = the amount of any Losses sustained on the Loans in the period from
the last Distribution Date and ending on the Relevant Distribution Date
and allocated to Funding (based on the Funding Share Percentage thereof
calculated on the immediately preceding Distribution Date or, in the
case of the first Distribution Date, the Initial Funding Share
Percentage) in the Distribution Period ending on the Relevant
Distribution Date;
D = an amount equal to any consideration (excluding Deferred
Consideration) paid by Funding to the Seller in relation to any New
Loans assigned to the Mortgages Trustee on the Relevant Distribution
Date;
E = an amount equal to any consideration (excluding Deferred
Consideration) paid by Funding to the Seller in relation to any
acquisition by Funding from the Seller on the Relevant Distribution
Date of an interest in the Trust Property;
F = an amount equal to the portion of any Capitalised Interest accrued
on the Loans in the Distribution Period ending on the Relevant
Distribution Date which is allocated to the Funding Share in accordance
with Clause 5.1 less the amount of any payment made by Seller to
Funding pursuant to Clauses 5.2 or 5.3 as the case may be, in respect
of such portion of Capitalised Interest; and
G = the amount of the Retained Principal Receipts (if any) plus the
aggregate Outstanding Principal Balance of all the Loans constituting
the Trust Property as at the Relevant Distribution Date after making
the distributions, allocations and additions referred to in (B), (C),
(D), (E) and (F) above, and after taking account of (i) any
distributions of Principal Receipts to Funding and the Seller; (ii) the
amount of any Losses allocated to Funding and the Seller; (iii) any
increase in the Loan balances due to Borrowers taking Payment Holidays
or making Underpayments under Flexible Loans; (iv) the adjustments
referred to paragraphs 8.4(a) to 8.4(e) (inclusive) below; and (v) the
amount of any other additions or subtractions to the Trust Property.
8.3 CURRENT FUNDING SHARE
The CURRENT FUNDING SHARE will be an amount equal to:
A - B - C + D + E + F
where "A", "B", "C", "D", "E" and "F" have the meanings specified in
Clause 8.2 above.
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8.4 ADJUSTMENTS TO TRUST PROPERTY
On each Relevant Distribution Date the aggregate Outstanding Principal
Balance of the Loans constituting the Trust Property shall be reduced
or, as the case may be, deemed to be reduced for the purposes of the
calculation set out in "G" above, if any of the following events has
occurred in the Distribution Period ending on the Relevant Distribution
Date:
(a) any Borrower exercises a right of set-off in relation to Loans
constituting part of the Trust Property so that the amount of
principal and/or interest owing under a loan is reduced but no
corresponding amount is received by the Mortgages Trustee; in
which event the total amount of Trust Property shall be
reduced by an amount equal to the amount set-off; and/or
(b) a Loan or (as applicable) its Related Security (i) does not
comply with the Loan Warranties in the Mortgage Sale Agreement
or (ii) is the subject of a Product Switch or a Further
Advance or other obligation of the Seller to repurchase
(including, for the avoidance of doubt, any obligation to
repurchase pursuant to Clause 7.4 of the Mortgage Sale
Agreement), and if the Seller fails to repurchase the Loan or
Loans under the relevant Mortgage Account and their Related
Security as required by the terms of the Mortgage Sale
Agreement, then the Trust Property shall be deemed to be
reduced for the purposes of the calculation in "G" above by an
amount equal to the Outstanding Principal Balance of the
relevant Loan or Loans under the relevant Mortgage Account
together with Arrears of Interest and Accrued Interest; and/or
(c) the Seller would be required to repurchase a Loan and its
Related Security in accordance with the terms of the Mortgage
Sale Agreement, but such Loan and its Related Security are
not capable of repurchase, in which case the Trust Property
shall be deemed to be reduced for the purposes of the
calculation in "G" above by an amount equal to the
Outstanding Principal Balance of the relevant Loan or Loans
under the relevant Mortgage Account together with Arrears of
Interest and Accrued Interest; and/or
(d) the Seller materially breaches any other obligation or
warranty under the Mortgage Sale Agreement and/or (for so long
as it is the Servicer) the Servicing Agreement, which is also
grounds for terminating the appointment of the Servicer in
which event the aggregate Outstanding Principal Balance of
Loans constituting the Trust Property shall be deemed for the
purposes of the calculation in "G" above to be reduced by an
amount equivalent to all losses, costs, liabilities, claims,
expenses and damages incurred by the Beneficiaries as a result
of such breach; and/or
(e) the Seller Share of Mortgages Trustee Revenue Receipts is less
than the Loss Amount (as defined in Clause 10.3) payable to
the Mortgages Trustee and/or Funding in accordance with Clause
10.3, in which case the Trust Property shall be deemed to be
reduced for the purposes of the calculation in "G" above by an
amount equal to the shortfall in the Loss Amount.
The reductions and deemed reductions set out in paragraphs 8.4(a),
8.4(b), 8.4(c), 8.4(d) and 8.4(e) above shall be made to the Seller
Share only of the Trust Property (or for the purposes of calculating
the Seller Share of the Trust Property as the case may be) until the
Seller Share is zero. If at, or any time after the Initial Closing Date
the Mortgages Trustee holds, or there is held to its order, or it
receives, or there is received to its order, any property, interest,
right or benefit relating to any Loan and its Related Security which is
or has been subject to any matter described in Clause 8.4(a) the
Mortgages Trustee will remit, assign or transfer the
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same to the Seller, as the case may require, and until it does so or to
the extent that the Mortgage Trustee is unable to effect such
remittance, assignment or transfer, the Mortgages Trustee will hold
such property, interest, right or benefit and/or the proceeds thereof
upon trust absolutely for the Seller (separate from the Mortgages
Trust).
8.5 CURRENT SELLER SHARE PERCENTAGE
On each Distribution Date, the CURRENT SELLER SHARE PERCENTAGE will be
an amount equal to:
100% - Current Funding Share Percentage.
8.6 CURRENT SELLER SHARE
The CURRENT SELLER SHARE will be an amount equal to:
The total amount of Trust Property - Current Funding Share.
8.7 FUNDING SHARE/SELLER SHARE
Neither the Funding Share nor the Seller Share may be reduced below
zero. At all times the Funding Share Percentage and the Seller Share
Percentage shall be equal to 100 per cent. of the Trust Property.
9. MINIMUM SELLER SHARE
9.1 INITIAL MINIMUM SELLER SHARE
The Seller Share of the Trust Property includes an amount equal to the
Minimum Seller Share. Unless and until the Funding Share of the Trust
Property is in an amount equal to zero or an Asset Trigger Event
occurs, the Seller will not be entitled to receive Principal Receipts
which would reduce the Seller Share of the Trust Property to an amount
less than the Minimum Seller Share and the Seller consents and directs
the Mortgages Trustee accordingly.
9.2 FLUCTUATION OF MINIMUM SELLER SHARE ON EACH DISTRIBUTION DATE
On and from the Ninth Issuer Closing Date, the amount of the Minimum
Seller Share will be recalculated on each Distribution Date in
accordance with the following formula:
W + X + Y + Z + AA
where:
W = 100% of the aggregate cleared balances of all savings
accounts opened in respect of Flexible Plus Loans;
X = 4.0% of the aggregate Outstanding Principal Balance of all
Loans comprised in the Trust Property;
Y = the product of: (p x q) x r where:
p = 8%;
q = the FLEXIBLE DRAW CAPACITY, being an amount equal
to the excess of (i) the maximum amount that
Borrowers are entitled to draw under Flexible Loans
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included in the Trust Property (whether or not drawn)
over (ii) the aggregate principal balance of actual
Flexible Loan advances made to Borrowers in the Trust
Property on the relevant Distribution Date (but
excluding the Initial Advances made thereunder); and
r = 3;
Z = the aggregate sum of the reductions or deemed reductions
made to the Seller Share pursuant to Clauses 8.4(b),
8.4(c), and 8.4(d) on that Distribution Date; and
AA = the aggregate entitlement of Borrowers to receive Delayed
Cashbacks and Reward Cashbacks in respect of the
remaining life of the Reward Loans in the Trust Property.
9.3 RECALCULATION OF MINIMUM SELLER SHARE FOLLOWING OCCURRENCE OF
EXCEPTIONAL EVENTS
The calculation of the Minimum Seller Share in accordance with Clause
9.2 above will be recalculated with the agreement of the parties
hereto, the Security Trustee and the Rating Agencies if the Seller
merges or otherwise combines its business with another bank or other
financial institution so as to increase the risks associated with
Borrowers holding deposits in Abbey accounts
10. ALLOCATION AND DISTRIBUTION OF REVENUE RECEIPTS
10.1 ALLOCATION AND DISTRIBUTION OF THIRD PARTY AMOUNTS
Pursuant to the Cash Management Agreement, the Cash Manager (at the
direction of the Mortgages Trustee on behalf of the Beneficiaries at
their direction and with their consent) will deduct, as and when
identified, Third Party Amounts from the Revenue Receipts standing to
the credit of the Mortgages Trustee GIC Account, and pay over the same
to the proper recipients thereof. The Mortgages Trustee and the
Beneficiaries hereby consent to such deductions.
10.2 ALLOCATION AND DISTRIBUTION OF MORTGAGES TRUSTEE AVAILABLE REVENUE
RECEIPTS
On each Distribution Date the Cash Manager (at the direction of the
Mortgages Trustee and on behalf of the Beneficiaries at their direction
and with their consent) will distribute Mortgages Trustee Available
Revenue Receipts as follows:
(a) firstly, in or towards satisfaction pro rata according to the
respective amounts thereof of:
(i) any costs, charges, liabilities and expenses then due
or to become due to the Mortgages Trustee under the
provisions of this Deed together with VAT thereon as
provided herein (if payable); and
(ii) any amounts due and payable by the Mortgages Trustee
to third parties in respect of the Mortgages Trust
and incurred without breach by the Mortgages Trustee
of the documents to which it is a party (and for
which payment has not been provided for elsewhere),
including amounts due to H.M. Revenue and Customs or
any other taxation authority which has jurisdiction
over the Trust Property or the Mortgages Trustee in
respect of any stamp, issue, registration,
documentary and other fees, duties and taxes
(including interest and penalties) payable by the
Mortgages Trustee in connection with (i) the
execution and delivery of this Deed; (ii) any action
to be taken by or on
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behalf of the Mortgages Trustee to enforce or to
resolve any doubt concerning or, for any other
purpose in relation to, the Mortgages Trust Deed; and
(iii) any such tax which is primarily due from either
or both of the Seller and Funding in their capacities
as Beneficiaries (and, for the avoidance of doubt,
only in such capacities) in circumstances where the
Mortgages Trustee has made a payment of such tax (or
part thereof) by reason of a failure by the Seller or
Funding to discharge their primary liability in
respect of such tax;
(b) secondly, in or towards satisfaction of any remuneration then
due and payable to the Servicer and any costs, charges,
liabilities and expenses then due or to become due to the
Servicer under the provisions of the Servicing Agreement,
together with VAT thereon as provided therein; and
(c) thirdly, subject to Clause 10.3 below, to pay Funding and the
Seller the Funding Share and the Seller Share respectively of
any remaining Mortgages Trustee Available Revenue Receipts,
calculated by multiplying the total amount of such remaining
Mortgages Trustee Available Revenue Receipts by the Current
Funding Share Percentage (calculated on the immediately
preceding Distribution Date), which product shall be allocated
to Funding, and the remaining Mortgages Trustee Available
Revenue Receipts which shall be allocated to the Seller
(subject to deducting any amounts due to the Mortgages Trustee
and/or Funding by way of set-off pursuant to Clause 7.3 of the
Mortgage Sale Agreement).
10.3 If, as a result of any of the matters referred to in paragraphs (a) to
(g) inclusive of Clause 7.4 of the Mortgage Sale Agreement, the
Mortgages Trustee and/or Funding suffers or incurs any costs, expenses,
losses or other claims in connection with any recovery of interest on
the Loans to which the Seller, the Mortgages Trustee or Funding was not
entitled or could not enforce (referred to in this Clause 10.3 as the
LOSS AMOUNT), then:
(a) the Seller Share of Mortgages Trustee Revenue Receipts shall
be reduced by an amount equal to the Loss Amount; and
(b) from the amount deducted from the Seller Share of the
Mortgages Trustee Revenue Receipts referred to in paragraph
(a) above:
(i) an amount will be paid to the Mortgages Trustee equal
to the Loss Amount incurred by the Mortgages Trustee;
and
(ii) an amount will be paid to Funding equal to the Loss
Amount incurred by Funding.
11. ALLOCATION AND DISTRIBUTION OF PRINCIPAL RECEIPTS
11.1 CALCULATION OF PRINCIPAL RECEIPTS:
On each Relevant Distribution Date, prior to distributing Principal
Receipts, the Cash Manager shall ascertain:
(a) the amount of Mortgages Trust Available Principal Receipts:
(b) whether the Cash Accumulation Period has started or would
start during the immediately succeeding Distribution Period in
respect of any Bullet Term Advance or any applicable Series 1
Term AAA Cash Amount (the Cash Accumulation Period
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being calculated separately for each Bullet Term Advance or
each Series 1 Term AAA Cash Amount);
(c) whether amounts are outstanding in respect of any Pass-Through
Term Advances or Scheduled Amortisation Term Advances that are
then due and payable; and
(d) whether the Scheduled Amortisation Period has started or would
start during the immediately succeeding Distribution Period in
respect of any Scheduled Amortisation Term Advance.
11.2 ALLOCATION AND DISTRIBUTION OF PRINCIPAL RECEIPTS PRIOR TO THE
OCCURRENCE OF A TRIGGER EVENT
Prior to the occurrence of a Trigger Event, on each Distribution Date,
the Cash Manager (at the direction of the Mortgages Trustee acting on
behalf of the Beneficiaries at their direction and with their consent)
shall apply Principal Receipts as provided in this Clause 11:
(a) (subject to the terms of, and after making the distributions
referred to in, paragraphs (b), (c), (d), (e) and (f) below),
all Principal Receipts shall be paid to the Seller until the
Seller Share of the Trust Property is equal to the Minimum
Seller Share (as determined on the previous Distribution
Date);
(b) to allocate and distribute to Funding an amount equal to the
aggregate of (i) the amounts required by Funding to replenish
the First Reserve Fund to the extent that amounts have been
drawn from the First Reserve Fund to make scheduled repayments
of principal under any Intercompany Loan and (ii) to the
extent that there is a shortfall in the Funding Liquidity
Reserve Fund Required Amount, an amount equal to the shortfall
required to be paid by Funding into the Funding Liquidity
Reserve Fund;
(c) after making the distributions in (b) above, from and
including the start of a Cash Accumulation Period, all
Principal Receipts shall be allocated and distributed to
Funding (but only to the extent that such payments shall not
cause the Funding Share of the Trust Property to fall below
zero) until an amount equal to the relevant Bullet Amount or
the relevant Series 1 Term AAA Cash Amount has been or will
have been accumulated by Funding, as shown on the Cash
Accumulation Ledger and on the relevant Cash Accumulation
Sub-Ledger, as applicable;
(d) after making the distributions in (b) and (c) above, the Cash
Manager on behalf of the Mortgages Trustee shall allocate and
distribute Principal Receipts to Funding in an amount equal to
the Scheduled Amortisation Amount due on the relevant
Scheduled Amortisation Term Advance on the immediately
succeeding Interest Payment Date (but only to the extent that
such payments shall not cause the Funding Share of the Trust
Property to fall below zero);
(e) after making the distributions in (b), (c) and (d) above, from
and including the date when amounts are or will become
outstanding on the next following Interest Payment Date in
respect of one or more Pass-Through Term Advances that are due
and payable (the PAYABLE PASS-THROUGH TERM ADVANCES) under an
Intercompany Loan, ignoring for these purposes the deferral of
repayment of any Term BBB Advance, any Term A Advance and any
Term AA Advance, then the aggregate amount of the following
amounts in respect of each Intercompany Loan under which such
Payable Pass-Through Term Advances arise shall be allocated
and distributed to Funding until all of such Payable
Pass-Through Term Advances are fully repaid or will on the
next
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following Interest Payment Date be fully repaid. The amounts
referred to above shall be determined in respect of each
Intercompany Loan Agreement advanced by any Issuer to Funding
which then comprises a Payable Pass-Through Term Advance
(INTERCOMPANY LOAN AGREEMENT X) and shall be:
(i) prior to the occurrence of any option to redeem the
Notes or any New Notes issued by the Issuer (or a New
Issuer) which is the lender of such Intercompany Loan
Agreement X (but only where such right of redemption
arises on or after a particular specified date and
not as a result of the occurrence of any event
specified in the Terms and Conditions), the
Outstanding Principal Balance of each Payable
Pass-Through Term Advance forming part of such
Intercompany Loan Agreement X; and
(ii) after the occurrence of any option to redeem the
Notes or any New Notes issued by the Issuer or a New
Issuer which is the lender of such Intercompany Loan
Agreement X (but only where such right of redemption
arises on or after a particular specified date and
not as a result of the occurrence of any event
specified in the Terms and Conditions), an amount
calculated as follows:
Funding Share x Principal x Outstanding Principal Balance of
Percentage Receipts Intercompany Loan Agreement X
________________________________
Aggregate Outstanding Principal
Balance of all outstanding
Intercompany Loans,
(but in each case taking into account any amounts
available to Funding in the Funding Principal Ledger
to make such payments) and provided always that
distributions shall only be made to the extent that
such payments shall not cause the Funding Share of
the Trust Property to fall below zero; and
(f) after making the distributions in (b), (c), (d) and (e), if
such Distribution Date is a Seller Share Event Distribution
Date, then the Cash Manager shall deposit such excess
Principal Receipts (the RETAINED PRINCIPAL RECEIPTS) in the
Mortgages Trustee GIC Account and make a corresponding credit
to the Principal Ledger.
11.3 ALLOCATION AND DISTRIBUTION OF PRINCIPAL RECEIPTS FOLLOWING THE
OCCURRENCE OF AN ASSET TRIGGER EVENT
After the occurrence of an Asset Trigger Event, all Principal Receipts
and any Retained Principal Receipts will be distributed by the Cash
Manager as follows:
(a) if the immediately preceding Distribution Date was a Seller
Share Event Distribution Date, all of the Retained Principal
Receipts to Funding until the Funding Share of the Trust
Property is zero; and then
(b) pro rata and pari passu between Funding and the Seller
according to the Current Funding Share Percentage of the Trust
Property and the Current Seller Share Percentage of the Trust
Property respectively (and, for the avoidance of doubt, such
payments may reduce the Current Seller Share to an amount less
than the Minimum Seller Share), until the Funding Share of the
Trust Property is zero.
When the Funding Share of the Trust Property is zero, the remaining
Principal Receipts (if any) will be allocated to the Seller.
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11.4 ALLOCATION AND DISTRIBUTION OF PRINCIPAL RECEIPTS FOLLOWING THE
OCCURRENCE OF A NON-ASSET TRIGGER EVENT
After the occurrence of a Non-Asset Trigger Event (where an Asset
Trigger Event has not occurred), all Principal Receipts and any
Retained Principal Receipts will be paid to Funding until the Funding
Share of the Trust Property is zero and will thereafter be paid to the
Seller.
11.5 ALLOCATION AND DISTRIBUTION OF PRINCIPAL RECEIPTS FOLLOWING ENTRY BY
FUNDING INTO A NEW TERM ADVANCE
If a New Issuer makes a New Term Advance to Funding pursuant to a New
Intercompany Loan Agreement, then the parties hereto shall amend the
terms of Clause 11 as required to reflect the repayment provisions of
that New Term Advance. If (with the consent of the Seller and Funding)
any New Issuer or New Issuers acquire a direct interest in the Trust
Property, the parties hereto shall amend the terms of this Deed as
required to reflect such acquisition by the New Issuer or New Issuers.
For the avoidance of doubt, in either case, the parties hereto shall
amend the terms of the Trigger Events if required to do so by the
Rating Agencies as a result of the issue of New Notes by any such New
Issuer or New Issuers, as the case may be.
12. ALLOCATION OF LOSSES
Subject as provided herein (and in particular, Clause 8), all Losses
sustained on the Loans during a Distribution Period shall be applied in
reducing pro rata both the Funding Share and the Seller Share on each
Relevant Distribution Date by multiplying the Losses in the relevant
Distribution Period by the Current Funding Share Percentage, (as
calculated on the immediately preceding Distribution Date), the product
of which shall be allocated to Funding (until the Funding Share is
zero), and the remainder of such Losses shall be allocated to the
Seller.
13. LEDGERS
The Mortgages Trustee shall maintain, or shall procure that there are
maintained, the following Mortgages Trustee Ledgers:
(a) the Principal Ledger, which shall record all receipts of
Principal Receipts and Retained Principal Receipts and
distribution of the same to Funding and the Seller;
(b) the Revenue Ledger, which shall record all receipts of Revenue
Receipts and distribution of the same to Funding and the
Seller;
(c) the Losses Ledger, which shall record Losses in relation to
the Loans; and
(d) the Funding Share/Seller Share Ledger which shall record the
Current Funding Share, the Current Seller Share of the Trust
Property, the Current Funding Share Percentage and the Current
Seller Share Percentage.
14. COSTS AND EXPENSES OF THE MORTGAGES TRUSTEE
The Mortgages Trustee shall be entitled to charge and be remunerated
for the work undertaken by it as trustee of the trusts created by this
Deed. The remuneration shall be on such terms (if any) as the Mortgages
Trustee may from time to time agree with the Seller and Funding in
writing. In default of such agreement, Funding and the Seller shall
indemnify the Mortgages Trustee from time to time with such regularity
as is reasonably agreed between the parties, of the documentable costs
and expenses directly and properly incurred by the
15
Mortgages Trustee in performing its obligations hereunder together with
any amounts in respect of Irrecoverable VAT incurred in respect of such
costs and expenses. The cost of such indemnity shall be paid in
accordance with the priority of payments set out in Clause 10.2 of this
Deed.
15. DIRECTIONS FROM BENEFICIARIES
15.1 SERVICING AGREEMENT AND CASH MANAGEMENT AGREEMENT
On the Initial Closing Date the Mortgages Trustee shall enter into the
Servicing Agreement and the Cash Management Agreement.
15.2 DIRECTIONS FROM BENEFICIARIES
Subject to Clause 15.3 below, the Mortgages Trustee covenants with the
Seller and Funding that the Mortgages Trustee shall take all necessary
steps and do everything which both Funding and the Seller (acting
together) may reasonably request or direct it to do in order to give
effect to the terms of this Deed or the other Transaction Documents to
which the Mortgages Trustee is a party.
15.3 Funding and the Seller covenant with each other that neither shall
direct or request the Mortgages Trustee to do any act or thing which
breaches the terms of, or is otherwise expressly dealt with (such that
the Mortgages Trustee has no discretion) by, any of the Transaction
Documents.
15.4 NO REQUIREMENT TO ACT
The Mortgages Trustee will not be bound and shall have no power to take
any proceedings, actions or steps under or in connection with any of
this Deed or the other Transaction Documents to which it is a party
unless:
(a) it shall have been directed to do so by the Beneficiaries or
it is required to do so under any express provision of this
Deed or the other Transaction Documents (but subject to Clause
15.2 in respect of conflict of directions); and
(b) it shall have been indemnified to its satisfaction against all
liabilities, proceedings, claims and demands to which it may
be or become liable and all costs, charges and expenses which
may be incurred by it in connection therewith and the terms of
such indemnity may include the provision of a fighting fund,
non-recourse loan or other similar arrangement.
15.5 COVENANT OF THE MORTGAGES TRUSTEE
Subject to Clause 15.2, the Mortgages Trustee covenants with each of
the Seller and Funding to exercise all of its rights arising under the
Trust Property (including without limitation any rights of enforcement)
for the benefit of and on behalf of the Beneficiaries.
16. EARLY TERMINATION OF THE MORTGAGES TRUST
On giving not more than 61 nor less than 31 days' notice to Funding,
the Seller may pay to Funding the Termination Price in exchange for the
Funding Share of the Trust Property if the aggregate Outstanding
Principal Balance under all Intercompany Loan Agreements is at any time
less than 10 per cent. of the aggregate Outstanding Principal Balance
of all Intercompany Loan Agreements as at the respective drawdown dates
thereof. Thereafter, the Mortgages
16
Trustee shall hold the Trust Property for the Seller absolutely, freed
and released from the Mortgages Trust.
17. TRANSFERS
17.1 FUNDING SHALL NOT ASSIGN
Subject to the right of Funding (or the Security Trustee or a Receiver
on its behalf) to sell the Funding Share of the Trust Property
following the service of an Intercompany Loan Enforcement Notice (which
right is hereby conferred), Funding covenants with the Seller that it
shall not, and shall not purport to, sell, assign, transfer, convey,
charge, declare a trust over, create any beneficial interest in, or
otherwise dispose of the Funding Share in the Trust Property, or any of
Funding's rights, title and interest or benefit in any of the Portfolio
or the Trust Property to a third party, other than pursuant to the
terms of the Transaction Documents (including for the avoidance of
doubt, the Funding Deed of Charge).
17.2 SELLER SHALL NOT ASSIGN
The Seller covenants with Funding that it shall not, and shall not
purport to, sell, assign, transfer, convey, charge, declare a trust
over, create any beneficial interest in, or otherwise dispose of the
Seller Share in the Trust Property or any of the Seller's rights, title
and interest or benefit in the Trust Property to a third party, other
than pursuant to the terms of the Transaction Documents.
18. COVENANTS OF THE MORTGAGES TRUSTEE
Save with the prior written consent of the Beneficiaries or as provided
in or envisaged by this Deed and the other Transaction Documents to
which the Mortgages Trustee is a party, the Mortgages Trustee shall
not, so long as it is acting as Mortgages Trustee hereunder:
(a) Negative Pledge
create or permit to subsist any mortgage, standard security,
pledge, lien, charge or other security interest whatsoever
(unless arising by operation of law), upon the whole or any
part of its assets (including any uncalled capital) or its
undertakings, present or future;
(b) Disposal of Assets
transfer, sell, lend, part with or otherwise dispose of, or
deal with, or grant any option or present or future right to
acquire any of its assets or undertakings or any interest,
estate, right, title or benefit therein or thereto or agree or
attempt or purport to do so;
(c) Equitable Interest
permit any person other than the Beneficiaries to have any
equitable or beneficial interest in any of its assets or
undertakings or any interest, estate, right, title or benefit
therein;
(d) Bank Accounts
have an interest in any bank account, other than as set out in
the Transaction Documents;
17
(e) Restrictions on Activities
carry on any business other than as described in this Deed and
the Mortgage Sale Agreement;
(f) Borrowings
incur any indebtedness in respect of borrowed money whatsoever
or give any guarantee or indemnity in respect of any such
indebtedness;
(g) Merger
consolidate or merge with any other person or convey or
transfer its properties or assets substantially as an entirety
to any other person;
(h) Employees or premises
have any employees or premises or subsidiaries;
(i) Further shares
issue any further shares; or
(j) United States activities
engage in any activities in the United States (directly or
through agents) or derive any income from United States
sources as determined under United States income tax
principles or 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 tax
principles.
19. POWER TO DELEGATE
19.1 POWER TO DELEGATE
Subject to Clause 19.2, the Mortgages Trustee may (notwithstanding any
rule of law or equity to the contrary) delegate (revocably or
irrevocably and for a limited or unlimited period of time) the
performance of all or any of its obligations and the exercise of all or
any of its powers under this Deed or imposed or conferred on it by law
or otherwise to any person or body of persons fluctuating in number
selected by it and any such delegation may be by power of attorney or
in such other manner as the Mortgages Trustee may think fit and may be
made upon such terms and conditions (including the power to
sub-delegate) as the Mortgages Trustee may think fit.
19.2 NO FURTHER APPOINTMENTS
Notwithstanding the provisions of Clause 19.1, the Mortgages Trustee
shall not appoint any agent, attorney or other delegate having power to
act in respect of the Trust Property unless it is directed in writing
to do so by the Beneficiaries. The appointment of any agent, attorney
or other delegate hereunder above shall terminate immediately upon the
occurrence of a Trigger Event.
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20. POWERS OF INVESTMENT
Save as expressly provided for in this Deed, the Mortgages Trustee
Guaranteed Investment Contract and the Bank Account Agreement, the
Mortgages Trustee shall have no further or other powers of investment
with respect to the Trust Property and neither the Trustee Investments
Act 1961 nor any other provision relating to trustee powers of
investment implied by statute or general law shall apply to the
Mortgages Trust and, for the avoidance of doubt, the statutory power to
accumulate income conferred on trustees by Section 31 of the Trustee
Act 1925 is expressly excluded.
21. OTHER PROVISIONS REGARDING THE MORTGAGES TRUSTEE
21.1 NO ACTION TO IMPAIR TRUST PROPERTY
Except for actions expressly authorised by this Deed, the Mortgages
Trustee shall take no action reasonably likely to impair the interests
of the Beneficiaries in any Trust Property now existing or hereafter
created or to impair the value of any Loan or its Related Security
subject to the Mortgages Trust.
21.2 LITIGATION
The Mortgages Trustee must not prosecute or defend any legal or other
proceedings anywhere in the world (at the cost of the Trust Property)
unless it obtains legal or other advice that it is in the interests of
the Beneficiaries to do so.
21.3 NO IMPLIED DUTIES
The duties and obligations of the Mortgages Trustee under the Mortgages
Trust shall be determined solely by the express provisions of this Deed
(but without prejudice to the duties and obligations of the Mortgages
Trustee under any of the other Transaction Documents). The Mortgages
Trustee shall not be liable under this Deed except for the performance
of such duties and obligations as shall be specifically set forth in
this Deed. No implied covenants or obligations shall be read into this
Deed against the Mortgages Trustee, and the permissible right of the
Mortgages Trustee to do things set out in this Deed shall not be
construed as a duty.
21.4 NO LIABILITY
Neither the Mortgages Trustee, Funding (in its capacity as a
Beneficiary hereunder) nor the Seller (in its capacity as a Beneficiary
hereunder) shall be liable to each other, in the absence of wilful
default, negligence or breach of the terms of this Deed, in respect of
any loss or damage which arises out of the exercise or attempted or
purported exercise or failure to exercise any of their respective
powers.
21.5 RELIANCE ON CERTIFICATES
The Mortgages Trustee may rely on and shall be protected in acting on,
or in refraining from acting in accordance with, any resolution,
officer's certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by
it to be genuine and to have been signed or presented to it pursuant to
the Transaction Documents by the proper party or parties.
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21.6 RELIANCE ON THIRD PARTIES
The Mortgages Trustee may, in relation to these presents, act on the
opinion or advice of or a certificate or any information obtained from
any lawyer, banker, valuer, broker, accountant, financial adviser,
securities dealer, merchant bank, computer consultant or other expert
in the United Kingdom or elsewhere and shall not, provided that it
shall not have acted fraudulently or in breach of any of the provisions
of the Transaction Documents, be responsible for any loss occasioned by
so acting. Any such opinion, advice, certificate or information may be
sent or obtained by letter, telemessage, telex, cable or facsimile
device and the Mortgages Trustee shall not be liable for acting on any
opinion, advice, certificate or information purporting to be so
conveyed although the same shall contain some error or shall not be
authentic, provided that such error or lack of authenticity shall not
be manifest.
22. NO RETIREMENT OF MORTGAGES TRUSTEE
22.1 NO RETIREMENT
The Mortgages Trustee shall not, and shall not purport to, retire as
the trustee of the Mortgages Trust or appoint any additional trustee of
the Mortgages Trust and shall have no power to retire or appoint any
additional trustee under the Trustee Xxx 0000 or otherwise.
22.2 NO REPLACEMENT
Neither the Seller nor Funding shall at any time remove or purport to
remove and/or replace the Mortgages Trustee as the trustee of the
Mortgages Trust.
22.3 NO TERMINATION
Prior to the payment by Funding of all amounts owing under the
Intercompany Loan Agreements and under the Transaction Documents,
neither the Seller nor Funding shall at any time, except in accordance
with the provisions of Clauses 16 and 23, terminate or purport to
terminate the Mortgages Trust and, in particular, but without prejudice
to the generality of the foregoing, the Seller and Funding shall not in
reliance on their absolute beneficial interests in the Trust Property
call for the transfer to them or vesting in them of the legal estate in
all or any part of the Trust Property.
23. TERMINATION
Subject to Clause 16, the Mortgages Trust shall terminate in respect of
the Trust Property (if any then remains) upon the later to occur of (i)
the date on which the Funding Share of the Trust Property is zero, and
(ii) any other date agreed in writing by Funding and the Seller.
24. FURTHER ASSURANCES
The parties agree that they will co-operate fully to do all such
further acts and things and execute any further documents as may be
necessary or desirable to give full effect to the arrangements
contemplated by this Deed.
25. AMENDMENTS, ETC.
25.1 AMENDMENTS AND WAIVERS
Without prejudice to Clause 28 of the Funding Deed of Charge, no
amendment or waiver of any provision of this Deed nor consent to any
departure by any of the parties therefrom shall
20
in any event be effective unless the same shall be in writing and
signed by each of the parties hereto. In the case of a waiver or
consent, such waiver or consent shall be effective only in the specific
instance and as against the party or parties giving it for the specific
purpose for which it is given.
25.2 ENTIRE AGREEMENT
This Deed contains a final and complete integration of all prior
expressions by the parties with respect to the subject matter of this
Deed and constitutes the entire agreement among the parties with
respect to the subject matter of this Deed superseding all prior oral
or written understandings other than the other Transaction Documents.
26. NON PETITION COVENANT
The Seller hereby agrees that it shall not institute against either
Funding or the Mortgages Trustee any winding-up, administration,
insolvency or similar proceedings so long as any sum is outstanding
under any Intercompany Loan Agreement and for one year plus one day
since the last day on which any such sum was outstanding.
27. NO PARTNERSHIP OR AGENCY
Nothing in this Deed shall be taken to constitute or create a
partnership between any of the parties to this Deed or to make or
appoint the Seller the agent of Funding (or vice versa).
28. CALCULATIONS
In the absence of manifest error, any determination or calculation or
performance by or on behalf of the Mortgages Trustee in connection with
the provisions of this Deed shall be deemed to be conclusive.
29. NO WAIVER; REMEDIES
No failure on the part of any party to this Deed to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or
remedy preclude any other or further exercise thereof or the exercise
of any other right or remedy. The remedies in this Deed are cumulative
and not exclusive of any remedies provided by law.
30. SEVERABILITY
Where any provision in or obligation under this Deed shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations under
this Deed, or of such provision or obligation in any other
jurisdiction, shall not be affected or impaired thereby.
31. CONFIDENTIALITY
31.1 GENERAL OBLIGATION OF CONFIDENTIALITY
Unless otherwise required by applicable law, and subject to Clause 31.2
below, each of the parties agrees to maintain the confidentiality of
this Deed in its communications with third parties and otherwise. None
of the parties shall disclose to any person any information relating to
the business, finances or other matters of a confidential nature of or
relating to any
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other party to this Deed or any of the Transaction Documents which it
may have obtained as a result of having entered into this Deed or
otherwise.
31.2 EXCEPTIONS
The provisions of Clause 31.1 above shall not apply:
(a) to the disclosure of any information to any person who is a
party to any of the Transaction Documents as expressly
permitted by the Transaction Documents;
(b) to the disclosure of any information which is or becomes
public knowledge otherwise than as a result of the wrongful
conduct of the recipient;
(c) to the extent that the recipient is required to disclose the
same pursuant to any law or order of any court or pursuant to
any direction or requirement (whether or not having the force
of law) of any central bank or any governmental or other
regulatory or Taxation authority;
(d) to the disclosure of any information to professional advisers
who receive the same under a duty of confidentiality;
(e) to the disclosure of any information with the consent of the
parties hereto;
(f) to the disclosure to the Rating Agencies or any of them of
such information as may be requested by any of them for the
purposes of setting or reviewing the rating assigned to the
Notes (or any of them), provided that no information which
would disclose the identity of a Borrower shall be disclosed
to the Rating Agencies or any of them;
(g) to the disclosure of any information disclosed to a
prospective assignee of Funding (provided that it is disclosed
on the basis that the recipient will hold it confidential); or
(h) to any disclosure for the purposes of collecting in or
enforcing the Trust Property or any of it.
32. EXCLUSION OF THIRD PARTY RIGHTS
The parties to this Deed do not intend that any term of this Deed
should be enforced, by virtue of the Contracts (Rights of Third
Parties) Xxx 0000, by any person who is not a party to this Deed.
33. ADDRESSES FOR NOTICES
Any notices to be given pursuant to this Deed to any of the parties
hereto shall be sufficiently served if sent by prepaid first class
post, by hand or facsimile transmission and shall be deemed to be given
(in the case of facsimile transmission) when despatched, (where
delivered by hand) on the day of delivery if delivered before 17.00
hours on a London Business Day or on the next London Business Day if
delivered thereafter or (in the case of first class post) when it would
be received in the ordinary course of the post and shall be sent:
(a) in the case of the Seller, to Abbey National plc, at Abbey
National House, 0 Xxxxxx Xxxxxx, Xxxxxx'x Xxxxx, Xxxxxx XX0
0XX (facsimile number (00) 00 0000 0000) for the attention of
the Company Secretary with a copy to Abbey National plc, c/o
Abbey House (AAM 126), 000 Xxxxxxx Xxxx Xxxx, Xxxxxx Xxxxxx
XX0 0XX (facsimile
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number (00) 0000 000 000) for the attention of Securitisation
Team, Retail Credit Risk;
(b) in the case of the Mortgages Trustee to Xxxxxx Trustees
Limited, c/o Abbey National plc, Abbey National House, 0
Xxxxxx Xxxxxx, Xxxxxx'x Xxxxx, Xxxxxx XX0 0XX (facsimile
number (00) 00 0000 0000) for the attention of the Company
Secretary with a copy to Abbey National plc, c/o Abbey House
(AAM 126), 000 Xxxxxxx Xxxx Xxxx, Xxxxxx Xxxxxx XX0 0XX
(facsimile number (00) 0000 000 000) for the attention of
Securitisation Team, Retail Credit Risk;
(c) in the case of Funding, to Xxxxxx Funding Limited, c/o Abbey
National plc, Abbey National House, 0 Xxxxxx Xxxxxx, Xxxxxx'x
Xxxxx, Xxxxxx XX0 0XX (facsimile number (00) 00 0000 0000) for
the attention of the Company Secretary with a copy to Abbey
National plc, c/o Abbey House (AAM 126), 000 Xxxxxxx Xxxx
Xxxx, Xxxxxx Xxxxxx XX0 0XX (facsimile number (00) 0000 000
019) for the attention of Securitisation Team, Retail Credit
Risk;
(d) in each case with a copy to the Security Trustee, for the
attention of JPMorgan Chase Bank, N.A., London Branch, Trinity
Tower, 9 Xxxxxx Xxxx Xxxxxx, Xxxxxx X0X 0XX (facsimile number
(00) 00 0000 0000) for the attention of The Manager, Trust
Administration,
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 33.
34. GOVERNING LAW AND SUBMISSION TO JURISDICTION
34.1 GOVERNING LAW
This Deed is governed by, and shall be construed in accordance with,
English law.
34.2 SUBMISSION TO JURISDICTION
Each party to this Deed hereby irrevocably submits to the non-exclusive
jurisdiction of the English courts in any action or proceeding arising
out of or relating to this Deed, 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 Deed 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.
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Exclusion of Trustee Xxx 0000
Xxx Xxxxxxx Xxx 0000 is hereby excluded to the maximum extent
permissible, to the intent that it shall not apply to the trusts
constituted hereunder and that the parties shall be in the same
position as they would be had that Act not come into force.
IN WITNESS of which this Deed has been duly executed and delivered by the
parties hereto as a deed which has been delivered on the date first appearing on
page one.
EXECUTED as a DEED by )
XXXXXX FUNDING )
LIMITED as Beneficiary )
acting by two )
directors/a director and the secretary )
Director
Director/Secretary
EXECUTED as a DEED by )
XXXXXX TRUSTEES )
LIMITED as Mortgages Trustee )
acting by two )
directors/a director and the secretary )
Director
Director/Secretary
EXECUTED as a DEED by )
SPV MANAGEMENT )
LIMITED as Settlor )
acting by )
SIGNED as a DEED )
by: )
as attorney for and on behalf of )
ABBEY NATIONAL PLC as )
Seller, Cash Manager and Beneficiary )
under a power of attorney dated )
in the presence of: )
Signature of witness:
Name of witness:
Address of witness:
Occupation of witness:
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