DRAFT 03.11.04 Exhibit 4.3
AMENDED AND RESTATED
MORTGAGE SALE AGREEMENT
DATED [{circle}], 0000
XXXXXXX PLC
as Seller and one of the Beneficiaries
AND
PERMANENT FUNDING (NO. 1) LIMITED
as Funding 1 and one of the Beneficiaries
AND
PERMANENT MORTGAGES TRUSTEE LIMITED
as Mortgages Trustee
AND
THE BANK OF NEW YORK
as Security Trustee
XXXXX & XXXXX
XXXXX & XXXXX LLP
LONDON
CONTENTS
CLAUSE PAGE
1. Definitions and Construction...............................................2
2. Sale and Purchase of Initial Portfolio.....................................2
3. Initial Closing Date.......................................................3
4. Sale and Purchase of New Portfolios........................................4
5. Trust of Monies...........................................................10
6. Completion of the Transfer of Loans.......................................10
7. Undertakings..............................................................12
8. Warranties and Repurchase by the Seller...................................14
9. Other Warranties..........................................................18
10. Further Assurance.........................................................18
11. Consequences of Breach....................................................18
12. Subordination.............................................................19
13. Non-Merger................................................................19
14. No Agency or Partnership..................................................19
15. Payments..................................................................19
16. Waiver and Variation......................................................19
17. Notices...................................................................20
18. Assignment................................................................20
19. Change of Security Trustee................................................21
20. Not Used..................................................................21
21. Third Party Rights........................................................21
22. Governing Law.............................................................21
SCHEDULE
1. Representations and warranties............................................23
2. Registered Transfer.......................................................31
3. Unregistered Transfer.....................................................32
4. Lending Criteria..........................................................35
5. Power of Attorney in favour of Funding 1, The Mortgages trustee
and the Security Trustee..................................................39
6. Loan Repurchase Notice....................................................42
7. Assignment of Third Party Rights..........................................43
8. Assignment of Halifax Mortgage Re Limited MIG Policies....................46
9. Halifax Mortgage Re Limited MIG Policies Assignment notice................48
10. Insurance Endorsement.....................................................49
11. Insurance Acknowledgements................................................51
12. New Portfolio Notice......................................................55
13. Forms of Scottish Transfer................................................57
14. Forms of Scottish Transfer................................................60
15. Form of Scottish Declaration of Trust.....................................63
16. Appendix
Part 1 Initial Portfolio................................................71
Part 2 Standard Documentation...........................................72
THIS AMENDED AND RESTATED MORTGAGE SALE AGREEMENT is made on [{circle}], 2004
BETWEEN:
(1) HALIFAX PLC (registered number 02367076), 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
capacities as the SELLER and one of the BENEFICIARIES);
(2) PERMANENT FUNDING (NO. 1) LIMITED (registered number 4267660), a private
limited company incorporated under the laws of England and Wales, whose
registered office is at Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX
(acting in its capacities as FUNDING 1 and one of the BENEFICIARIES);
(3) PERMANENT MORTGAGES TRUSTEE LIMITED (registered number 83116), a private
limited company incorporated under the laws of Jersey, Channel Islands,
whose registered office is at 00 Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX,
Channel Islands (acting in its capacity as the MORTGAGES TRUSTEE); and
(4) THE BANK OF NEW YORK, a New York banking corporation, acting through its
offices at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX (acting in its
capacity as 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 Seller carries on the business of, inter alia, originating mortgage
loans to individual borrowers secured on residential properties in England,
Wales or Scotland.
(B) The Seller has sold to the Mortgages Trustee certain of the above mentioned
mortgage loans together with the benefit of their related security on the
terms and subject to the conditions set out in the Mortgage Sale Agreement
(as amended and/or restated by this Agreement and from time to time, the
MORTGAGE SALE AGREEMENT).
(C) The Mortgages Trustee holds all of the above mentioned mortgage loans as
bare trustee for the Beneficiaries upon, with and subject to the trusts,
powers and provisions of the Mortgages Trust Deed (as amended and/or
restated from time to time, the MORTGAGES TRUST DEED).
(D) On 12th March, 2004 the parties to the Mortgage Sale Agreement agreed to
amend the terms of the Mortgage Sale Agreement as set out in an Amended and
Restated Mortgage Sale Agreement of the same date and the Seller sold a new
portfolio of mortgage loans to the Mortgages Trustee on 12th March, 2004 on
such amended terms.
(E) On 22nd July, 2004 the parties to the Mortgage Sale Agreement agreed to
amend the terms of the Mortgage Sale Agreement as set out in an Amended and
Restated Mortgage Sale Agreement of the same date and the Seller sold a new
portfolio of mortgage loans to the Mortgages Trustee on 22nd July, 2004 on
such amended terms.
1
(F) The parties to the Mortgage Sale Agreement have agreed to amend and restate
the terms of the Mortgage Sale Agreement as set out herein and the Seller
may sell new portfolios of mortgage loans and their related security to the
Mortgages Trustee on such amended terms.
IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND CONSTRUCTION
1.1 The amended and restated master definitions and construction schedule
signed by, amongst others, the parties to this Deed and dated [{circle}],
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.
1.2 Any reference in this Agreement to any discretion, power, right, duty or
obligation on the part of the Mortgages Trustee shall be as exercised by
the Mortgages Trustee subject in each case to the provisions of CLAUSE 16.2
of the Mortgages Trust Deed.
1.3 For the purposes of Section 2 of the Law of Property (Miscellaneous
Provisions) Xxx 0000, the terms of the Transaction Documents are, so far as
applicable, incorporated herein.
1.4 The Initial Portfolio contained as Part 1 of the Exhibit to this Agreement
and any schedule of New Loans attached to any New Portfolio Notice may be
provided in a document stored upon electronic media (including, but not
limited to, a CD-ROM) in a form acceptable to the Mortgages Trustee, the
Security Trustee and Funding 1 (each acting reasonably).
1.5 This Agreement amends and restates the Mortgage Sale Agreement made on the
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.
2. SALE AND PURCHASE OF INITIAL PORTFOLIO
2.1 Subject to CLAUSE 2.2, in consideration of the Purchase Price (which shall
be paid in accordance with CLAUSE 3.3) and the covenant of the Mortgages
Trustee to hold the Trust Property upon trust, with and subject to all the
trusts, powers and provisions of the Mortgages Trust Deed, the Seller
hereby agrees to sell to the Mortgages Trustee with full title guarantee,
the Initial Portfolio on the Initial Closing Date.
2.2 The obligation of the Seller under CLAUSE 2.1 shall be subject to and
conditional upon:
(a) the issue by the First Issuer of the Issuer Notes on the Initial
Closing Date and the borrowing by Funding 1 of the Term Advances under
the First Issuer Intercompany Loan Agreement;
2
(b) the constitution of the Mortgages Trust on or prior to the Initial
Closing Date; and
(c) the Transaction Documents in existence on the Initial Closing Date
having been executed and delivered by the parties thereto on or before
the Initial Closing Date.
2.3 The sale of the Portfolio shall not include any obligation to pay any
Delayed Cashbacks, Home Cash Reserve Drawings or Flexible Loan Drawings (if
any), which obligation shall at all times, and notwithstanding the sale of
the Portfolio, remain an obligation of the Seller.
3. INITIAL CLOSING DATE
3.1 (a) A meeting shall take place at 11 a.m. on the Initial Closing Date at
the offices of Xxxxx & Xxxxx LLP, Xxx Xxx Xxxxxx, Xxxxxx XX0X 0XX or
such other time or offices as the parties may agree at which the
Seller shall deliver to the Security Trustee or its representative the
following documents:
(i) two originals of the power of attorney dated as at the Initial
Closing Date and substantially in the form set out in SCHEDULE 5
hereto, duly executed by the Seller;
(ii) a certified copy of each of the duly executed Insurance
Acknowledgements;
(iii) a certified copy of each of the duly executed Insurance
Endorsements;
(iv) a duly executed assignment of the Halifax Mortgage Re Limited
MIG Policies to the extent that they relate to the Mortgages
comprised in the Initial Portfolio from the Seller to the
Mortgages Trustee and a certified copy of a notice (the original
of which shall be served by the Seller by courier or by special
delivery) of such assignment from the Seller to HBOS Insurance
(PCC) Guernsey Limited dated as at the Initial Closing Date and
in the form (mutatis mutandis) set out in SCHEDULE 8 and
SCHEDULE 9 hereto respectively and a certified copy of consent
to assignment of the Halifax Mortgage Re Limited MIG Policies
(or acknowledgement that the Mortgages Trustee will be an
insured in respect of the Initial Portfolio under the Halifax
Mortgage Re Limited MIG Policies following such assignment) from
HBOS Insurance (PCC) Guernsey Limited in such form as HBOS
Insurance (PCC) Guernsey Limited reasonably requires;
(v) a certificate of a duly authorised officer of the Seller dated
as at the Initial Closing Date attaching a copy of the board
minute of the Seller authorising its duly appointed
representatives to agree the sale of the Portfolio and
authorising execution and performance of this Agreement, the
Servicing Agreement, the other Transaction Documents to which
the Seller is a party (in any capacity) and all of the
documentation to be entered into pursuant to this Agreement and
confirming that the resolutions referred to therein are in full
force and effect and have not been amended or rescinded as at
the date of the certificate;
(vi) a duly executed assignment of rights against third parties
comprised in the Initial Portfolio dated as at the Initial
Closing Date and in the form of the Assignment of Third Party
Rights; and
3
(vii) a solvency certificate from an authorised signatory of the
Seller dated the Initial Closing Date in a form acceptable to
the Mortgages Trustee, Funding 1 and the Security Trustee (each
acting reasonably).
(b) The parties hereto acknowledge that completion on the Initial Closing
Date of the sale to the Mortgages Trustee of all of the Seller's
right, title, interest and benefit in and to the Initial Portfolio
subject to the terms and provisions of the Mortgages Trust Deed shall
occur as indicated in this CLAUSE 3, provided that the matters
described in CLAUSES 6.2, 6.3, 6.4 and 6.5 shall not occur until the
relevant time indicated in CLAUSE 6 or, as applicable, CLAUSE 7.4.
3.2 The Seller undertakes that from the Initial Closing Date until the
perfection of the assignment or assignation (as appropriate) in accordance
with CLAUSES 6.2, 6.3, 6.4 and 6.5, the Seller shall hold the Title Deeds
and Customer Files relating to the Portfolio that are in its possession or
under its control or held to its order to the order of the Mortgages
Trustee or as the Mortgages Trustee shall otherwise direct.
3.3 Subject to fulfilment of the conditions referred to in CLAUSES 2.2 and 3,
the Seller shall be paid the Purchase Price by telegraphic transfer by
Funding 1 on the Initial Closing Date.
3.4 The Seller shall provide all reasonable co-operation to the Mortgages
Trustee, Funding 1 and the Security Trustee to enable them to carry out
their respective duties and enforce their rights under the Transaction
Documents. Without prejudice to the generality of the foregoing, the Seller
shall:
(a) upon reasonable prior notice and during normal office hours, permit
the Mortgages Trustee, Funding 1, the Security Trustee and their
authorised employees and agents and other persons nominated by the
Security Trustee and approved by the Seller (such approval not to be
unreasonably withheld or delayed), to review the Customer Files and
the Title Deeds in relation to the Portfolio (subject to such
person(s) agreeing to keep the same confidential but provided that
disclosure shall be permitted to the professional advisors and
auditors of the party to whom such disclosure is made and/or to the
extent that such disclosure is required by law or for the purpose of
any judicial or other proceedings); and/or
(b) give promptly all such information and explanations relating to the
Loans and their Related Security as the Mortgages Trustee, Funding 1
or the Security Trustee may reasonably request (including a list of
the Loans and their Related Security in the Portfolio along with
details of the location of the Title Deeds relating thereto),
provided that prior to completion in accordance with CLAUSE 6, the Seller
shall be under no obligation to provide any information or documentation to
any person other than the Mortgages Trustee and/or the Security Trustee or
their respective employees and/or professional advisors or allow such
person access to the Customer Files or Title Deeds if to do so would result
in a breach of the applicable Mortgage Terms or the Data Protection Xxx
0000.
4. SALE AND PURCHASE OF NEW PORTFOLIOS
4.1 Subject to fulfilment of the conditions set out in CLAUSES 2.2, 3.1, 4.2
(or as applicable, 4.3) and 4.4 and the restriction set out in CLAUSE 2.3,
if the Seller shall, at any time and from time
4
to time serve a properly completed New Portfolio Notice on the Mortgages
Trustee and Funding 1 with a copy to the Security Trustee (such service to
be in the Seller's sole discretion), the Seller agrees that on the date for
completion of the sale specified in such New Portfolio Notice the Seller
shall sell with full title guarantee (or in relation to rights and assets
situated in or governed by the law of Scotland with absolute warrandice) to
the Mortgages Trustee the relevant New Portfolio.
4.2 The conditions to be met as at each Sale Date are:
(a) no event of default under the Transaction Documents shall have
occurred which is continuing as at the relevant Sale Date;
(b) the Principal Deficiency Ledger shall not have a debit balance as at
the most recent Funding 1 Interest Payment Date after applying all
Funding 1 Available Revenue Receipts on that Funding 1 Interest
Payment Date;
(c) the Mortgages Trustee is not aware that the purchase of the New
Portfolio on the relevant Sale Date would adversely affect the then
current rating by the Ratings Agencies (or any of them) of the Notes;
(d) as at the relevant Sale Date, the Seller has not received any notice
that the short term, unsecured, unguaranteed and unsubordinated debt
obligations of the Seller are not rated at least [P-1] by Xxxxx'x,
[A-1] by S&P and [F1] by Fitch at the time of, and immediately
following, the sale of the New Loans to the Mortgages Trustee;
(e) as at the relevant Sale Date, the aggregate Outstanding Principal
Balance of the Loans in the Mortgages Trust, in respect of which the
aggregate amount in arrears is more than three times the Monthly
Payment then due, is less than [5] per cent. of the aggregate
Outstanding Principal Balance of the Loans in the Mortgages Trust;
(f) except where Funding 1 pays amounts to the Mortgages Trustee in
consideration of New Loans to be sold to it, the aggregate Outstanding
Principal Balance (excluding Arrears of Interest) of New Loans
transferred in any one Interest Period must not exceed [15] per cent.
of the aggregate Outstanding Principal Balance of Loans (excluding
Arrears of Interest) in the Mortgages Trust as at the beginning of
that Interest Period;
(g) the sale of the New Portfolio on the relevant Sale Date does not
result in the product of WAFF and WALS for the Portfolio after such
purchase calculated on the relevant Sale Date in the same way as for
the Initial Portfolio (or as agreed by the Servicer and the Rating
Agencies from time to time) exceeding the product of WAFF and WALS for
the Portfolio calculated on the most recent Closing Date plus [0.25]
per cent.;
(h) the yield (as calculated below) of the Loans in the Mortgages Trust
together with the yield of the New Loans to be sold to the Mortgages
Trustee on the relevant Sale Date (together for the purposes of this
paragraph, the RELEVANT LOANS) is at least [0.50] per cent. greater
than Sterling-LIBOR for three-month sterling deposits as at the
previous Interest Payment Date, after taking into account the average
yield on the Loans which are Variable Rate Loans, Tracker Rate Loans
and Fixed Rate Loans and the margins on the Funding 1 Swap(s), in each
case as at the relevant Sale Date. The yield of the Relevant Loans is
to be calculated as follows:
5
(AxB)+(Cx(D-E+F))+(Gx(H+I))
---------------------------
J
where,
(A) = the Outstanding Principal Balance, on the relevant Sale
Date, of the Relevant Loans which are Fixed Rate Loans;
(B) = the interest rate receivable by Funding 1 under the
Funding 1 Fixed-Floating Rate Swap as at the relevant Sale
Date;
(C) = the Outstanding Principal Balance, on the relevant Sale
Date, of the Relevant Loans which are Variable Rate Loans;
(D) = the weighted average Variable Base Rate of the Relevant
Loans which are Variable Rate Loans on the relevant Sale
Date;
(E) = the Variable Rate Swap SVR for the Relevant Loans which
are Variable Rate Loans on the relevant Sale Date;
(F) = the interest rate receivable by Funding 1 under the
Funding 1 Variable Rate Swap as at the relevant Sale Date;
(G) = the Outstanding Principal Balance, on the relevant Sale
Date, of the Relevant Loans which are Tracker Rate Loans;
(H) = the interest rate receivable by Funding 1 under the
Tracker Rate Swap as at the relevant Sale Date;
(I) = the weighted average margin of the Relevant Loans which
are Tracker Rate Loans over or under the Bank of England
Repo Rate on the relevant Sale Date;
(J) = the Outstanding Principal Balance of the Relevant Loans on
the relevant Sale Date;
(i) the sale of the New Loans on the relevant Sale Date does not result in
the loan-to-value ratio of the Loans and the New Loans after
application of the LTV Test on the relevant Sale Date exceeding the
loan-to-value ratio (based on the LTV Test) of Loans in the Portfolio
on the most recent Closing Date plus [0.25] per cent.;
(j) the sale of the New Loans on the relevant Sale Date does not result in
Loans (other than Fixed Rate Loans) which after taking into account
the Funding 1 Swap will yield less than Sterling-LIBOR plus [0.50] per
cent. as at the relevant Sale Date and that have more than 2 years
remaining on their incentive period accounting for more than [15] per
cent. of the aggregate Outstanding Principal Balance of all Loans
comprising the Trust Property;
(k) the sale of the New Loans on the relevant Sale Date does not result in
the Fixed Rate Loans which have more than 1 year remaining on their
incentive period accounting
6
for more than 50 per cent. of the aggregate Outstanding Principal
Balance of Loans comprised in the Trust Property;
(l) no sale of the New Loans may occur, if, as at the relevant Sale Date,
the Step-up Date in respect of any Note issued after 1st January, 2003
and still outstanding has been reached and such Note has not been
redeemed in full. For the avoidance of doubt, this prohibition on the
sale of New Loans to the Mortgages Trustee shall remain in effect only
for so long as any such Note remains outstanding and, upon its
redemption, the sale of New Loans to the Mortgages Trustee may be
resumed in accordance with the terms of this Agreement;
(m) as at the Sale Date, the adjusted General Reserve Fund is equal to or
greater than the General Reserve Fund Threshold;
(n) if the sale of New Loans includes the sale of New Loan Types to the
Mortgages Trustee, the Security Trustee has received written
confirmation from each of the Rating Agencies that such New Loan Types
may be sold and assigned to the Mortgages Trustee and that such sale
of New Loan Types would not have an adverse effect on the then current
ratings of the Notes;
(o) the Funding 1 Swap Agreement has been modified as required (or, if
appropriate, Funding 1 has entered into a new swap agreement) to hedge
against the interest rates payable in respect of such New Loans and
the floating rate of interest payable on the Issuer Intercompany Loan;
and
(p) no Trigger Event has occurred on or before the relevant Sale Date.
In this CLAUSE 4.2 references to any Monthly Payment due at any date means
the Monthly Payment payable in respect of the month in which that date
falls.
4.3 The obligations of the Seller under CLAUSE 4.1 shall be subject to and
conditional upon no Insolvency Event having occurred which is continuing as
at the relevant Sale Date.
4.4 Subject to fulfilment of the conditions referred to in CLAUSES 4.2, 4.3,
4.4, 4.5 and 4.6, the consideration to be provided to the Seller for the
sale and assignment of the New Portfolio to the Mortgages Trustee on a Sale
Date shall be the aggregate of:
(a) the payment by Funding 1 to the Seller by telegraphic transfer on the
relevant Sale Date of the proceeds of any New Intercompany Loan
advanced to Funding 1 by a New Issuer; and/or
(b) the covenant of the Mortgages Trustee to hold the Trust Property on
trust for the Seller (as to the Seller Share) and Funding 1 (as to the
Funding 1 Share) pursuant to the terms of the Mortgages Trust Deed.
4.5 (a) On the date of the sale of the relevant New Portfolio the Seller shall
deliver to the Security Trustee or its representative the following
documents:
(i) on the date of the first sale of a relevant New Portfolio
including Scottish Loans:
7
(A) two originals of the power of attorney dated as at the Sale
Date and substantially in the form set out in SCHEDULE 5
hereof duly executed by the Seller;
(B) a certified copy of each of the duly executed Insurance
Acknowledgements; and
(C) a certified copy of each of the duly executed Insurance
Endorsements;
(ii) a duly executed assignment of the Halifax Mortgage Re Limited
MIG Policies to the extent that they relate to the Mortgages
comprised in the relevant New Portfolio from the Seller to the
Mortgages Trustee and a certified copy of a notice (the original
of which shall be served by the Seller by courier or by special
delivery) of such assignment from the Seller to HBOS Insurance
(PCC) Guernsey Limited dated as of the relevant Assignment Date
and in the form (mutatis mutandis) set out in SCHEDULE 8 and
SCHEDULE 9 hereof respectively and a certified copy of consent
to assignment of the Halifax Mortgage Re Limited MIG policies
(or acknowledgement that the Mortgages Trustee will be an
insured under the Halifax Mortgage Re Limited MIG Policies
following the assignment) from HBOS Insurance (PCC) Guernsey
Limited in such form as HBOS Insurance (PCC) Guernsey Limited
reasonably requires;
(iii) a duly executed assignment of rights against third parties
comprised in the relevant New Portfolio dated as at the relevant
Sale Date and in the form of the Assignment of Third Party
Rights;
(iv) a certified copy of each of the duly executed Insurance
Acknowledgements;
(v) on any Sale Date that Funding 1 provides consideration for New
Loans to be sold to the Mortgages Trustee pursuant to CLAUSE
4.4(A) above only, a certificate of a duly authorised officer of
the Seller dated as at the relevant Sale Date attaching either
(i) a copy of the board minute referred to in CLAUSE 3.1(A)(V)
or (ii) any board minutes or considerations, notes and
resolutions of the Seller or its duly authorised delegate (as
applicable) authorising its duly appointed representatives to
agree the sale of a New Portfolio, and authorising the execution
and performance of the Transaction Documents to which the Seller
is party, in each case confirming that the resolutions referred
to therein are in full force and effect and have not been
amended or rescinded as at the date of the certificate;
(vi) on any Sale Date that Funding 1 provides consideration for New
Loans to be sold to the Mortgages Trustee pursuant to CLAUSE
4.4(A) above only, a solvency certificate from an authorised
signatory of the Seller dated as at the relevant Sale Date; and
(vii) a Scottish Declaration of Trust in respect of the Scottish Loans
and their Related Security comprised in the relevant New
Portfolio, in the form (mutatis mutandis) set out in SCHEDULE 15
and with the annexure thereto duly
8
completed, duly executed by the Seller, the Mortgages Trustee
and Funding 1.
(b) The parties hereto acknowledge that completion on each relevant Sale
Date of the sale to the Mortgages Trustee of all of the Seller's
right, title, interest and benefit in and to the relevant New
Portfolio subject to the terms and provisions of the Mortgages Trust
Deed shall occur as indicated in this CLAUSE 4 PROVIDED THAT the
matters described in CLAUSES 6.6 and 6.5 shall not occur until the
relevant time indicated in CLAUSE 6 or, as applicable, CLAUSE 7.5.
4.6 (a) The Seller undertakes that from the relevant Sale Date until the
perfection of the assignment or assignation (as appropriate) in
accordance with CLAUSES 6.2 and 6.5, the Seller shall hold the Title
Deeds and Customer Files relating to the New Portfolio that are in its
possession or under its control or held to its order to the order of
the Mortgages Trustee or as the Mortgages Trustee shall direct.
(b) The Seller undertakes that within three (3) London Business Days of
the Sale Date to provide the Mortgages Trustee and the Security
Trustee with an updated, complete and accurate list of the Loans and
their Related Security which comprise the New Portfolio which may be
provided in a document stored upon electronic media (including, but
not limited to a CD-Rom) in a form acceptable to the Mortgages Trustee
and the Security Trustee (each acting reasonably).
4.7 Prior to the earlier to occur of:
(a) a Trigger Event; and
(b) (i) if Funding 1 does not enter into a New Intercompany Loan
Agreement, the Interest Payment Date in [September 2011]; or
(ii) if Funding 1 does enter into New Intercompany Loan Agreements,
the latest Interest Payment Date specified by Funding 1 by notice
in writing to the Seller and the Mortgages Trustee as applying in
relation to this covenant,
the Seller undertakes to use all reasonable endeavours to offer to sell, in
accordance with the provisions of this CLAUSE 4, to the Mortgages Trustee and
the Mortgages Trustee undertakes to use all reasonable endeavours to acquire
from the Seller and to hold pursuant to the terms of the Mortgages Trust Deed
until the earlier of the Interest Payment Date falling in [September 2011] (or
such later date as may be notified by Funding 1 to the Seller) and the
occurrence of a Trigger Event, sufficient New Loans and their Related Security
so that the aggregate Outstanding Principal Balance of Loans in the Portfolio
(i) during the period from and including the Closing Date to but excluding the
Interest Payment Date in [September 2005] is not less than [GBP][27,000,000,000]
and (ii) during the period from and including the interest payment date in
[September 2005] to but excluding the Interest Payment Date in [September 2009]
is not less than [GBP][24,000,000,000] (or such other amount or amounts
specified by Funding 1 in the notice referred to in CLAUSE 4.7(B)(II) above)
provided that the Seller shall not be obliged to sell to the Mortgages Trustee,
and the Mortgages Trustee shall not be obliged to acquire, New Loans and their
Related Security if in the reasonable opinion of the Seller the sale to the
Mortgages Trustee of New Loans and their Related Security would adversely affect
the business of the Seller. 9
4.8 On each Sale Date that Funding 1 provides consideration for New Loans to be
sold to the Mortgages Trustee pursuant to CLAUSE 4.4(A) above, the
Beneficiaries shall appoint a firm of independent auditors to undertake a
due diligence exercise on a sample of the Customer Files relating to the
New Loans to be sold to the Mortgages Trustee on the relevant Sale Date.
The costs of such independent auditors shall be borne by the relevant New
Issuer (which shall be procured by Funding 1).
5. TRUST OF MONIES
5.1 Notwithstanding the sales effected by this Agreement, if at, or at any
other time after, the Closing Date (but prior to any repurchase in
accordance with CLAUSE 8.5) the Seller holds, or there is held to its
order, or it receives, or there is received to its order any property,
interests, rights or benefits and/or the proceeds thereof hereby agreed to
be sold, the Seller undertakes to each of the Mortgages Trustee, Funding 1
and the Security Trustee that, subject to CLAUSE 6, it will promptly remit,
assign and/or transfer the same to the Mortgages Trustee or, if
appropriate, the Security Trustee and until it does so or to the extent
that the Seller is unable to effect such remittance, assignment,
assignation or transfer, it will hold such property, interests, rights or
benefits and/or the proceeds thereof upon trust for the Mortgages Trustee
subject at all times to the Mortgages Trust.
5.2 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, interests, rights or benefits relating to:
(a) any Loan or Loans under a Mortgage Account and its Related Security
repurchased by the Seller pursuant to CLAUSE 8.5; or
(b) (without prejudice to CLAUSE 11) amounts owed by a Borrower to the
Seller which the Seller has not agreed to sell under CLAUSE 2.1,
and/or the proceeds thereof, the Mortgages Trustee undertakes to the Seller
that it will remit, assign, re-assign, retrocess or transfer the same to
the Seller, as the case may require, and until it does so or to the extent
that the Mortgages Trustee is unable to effect such remittance,
assignation, assignment, re-assignment, retrocession or transfer, the
Mortgages Trustee undertakes to hold such property, interests, rights or
benefits and/or the proceeds thereof upon trust for the Seller as the
beneficial owner thereof or as the Seller may direct provided that the
Mortgages Trustee shall not be in breach of its obligations under this
CLAUSE 5 if, having received any such monies and paid them to third parties
in error, it pays an amount equal to the monies so paid in error to the
Seller in accordance with the Servicing Agreement.
6. COMPLETION OF THE TRANSFER OF LOANS
6.1 The assignments or assignations (as appropriate) contemplated by this
Agreement shall be perfected on the twentieth London Business Day after the
earliest to occur of:
(a) the service of an Intercompany Loan Acceleration Notice or a Note
Acceleration Notice in relation to any Notes of any Issuer; or
(b) the Seller being required to perfect legal title to the Mortgages, or
procure any or all of the acts referred to in this CLAUSE 6 by an
order of a court of competent jurisdiction or by any regulatory
authority of which the Seller is a member or any organisation
10
whose members comprise (but are not necessarily limited to) mortgage
lenders and with whose instructions it is customary for the Seller to
comply; or
(c) it becoming necessary by law to do any or all of the acts referred to
in this CLAUSE 6; or
(d) the Security Trustee certifying that, in its reasonable opinion, the
property, assets and rights of Funding 1 comprised in the security
constituted by the Funding 1 Deed of Charge or any material part
thereof is/are in jeopardy and that the doing of any or all of the
acts referred to in CLAUSES 6.2 to 6.6 inclusive is necessary in order
materially to reduce such jeopardy; or
(e) unless otherwise agreed in writing by the Rating Agencies and the
Security Trustee, the termination of the Seller's role as Servicer
under the Servicing Agreement; or
(f) the Seller calling for perfection by serving notice in writing to that
effect on the Mortgages Trustee, Funding 1 and the Security Trustee;
or
(g) the date on which the Seller ceases to be assigned a long term
unsecured, unsubordinated debt obligation rating from S&P of at least
[BBB-] or from Xxxxx'x of at least [Baa3] or from Fitch of at least
[BBB-]; or
(h) the occurrence of an Insolvency Event in relation to the Seller; or
(i) the latest of the last repayment dates of the Intercompany Loans where
any Intercompany Loan has not been discharged in full.
6.2 Completion of the transfer of the English Mortgages in the Portfolio shall
be effected by:
(a) a Registered Transfer, in the case of English Mortgages over
Registered Land (in the form set out in SCHEDULE 2); and
(b) an Unregistered Transfer, in the case of English Mortgages over
Unregistered Land (in the form set out in SCHEDULE 3).
6.3 Completion of the transfer of the Scottish Mortgages in the Portfolio shall
be effected by:
(a) the completion and registration in the Land Register of Scotland of an
SLR Transfer, in the case of Scottish Mortgages over Properties title
to which is registered in the Land Register of Scotland (in the form
set out in SCHEDULE 13); and
(b) the completion and recording in the General Register of Sasines of a
Sasine Transfer (in the form set out in SCHEDULE 14), in the case of
Scottish Mortgages over Properties title to which is recorded in the
General Register of Sasines.
6.4 Completion of the transfer of any other matter comprised in the Portfolio
shall be effected by a transfer in such form as the Mortgages Trustee may
reasonably require.
6.5 Subject to CLAUSE 7.5, prior to perfection pursuant to CLAUSE 6.1, neither
the Mortgages Trustee nor Funding 1 nor the Security Trustee will:
11
(a) submit or require the submission of any notice, form, request or
application to or pay any fee for the registration of, or the noting
of any interest at the Land Charges Department of the Land Registry or
at the Land Registry or Registers of Scotland in relation to, the
Mortgages Trustee's and/or Funding 1's interests in the Portfolio;
(b) give or require the giving of any notice to any Borrower of the
assignment or assignation of that Borrower's Loan and its Related
Security to the Mortgages Trustee or the charge by Funding 1 of
Funding 1's interest in that Borrower's Loan and its Related Security
to the Security Trustee pursuant to the Funding 1 Deed of Charge; or
(c) send or require to be sent to any solicitor who has acted on behalf of
the Seller in respect of any Mortgage with respect to which the Seller
has not received a complete set of the Title Deeds a letter or other
communication requiring such solicitor to hold such documents to the
order of the Mortgages Trustee or the Security Trustee (as the case
may be).
6.6 Within 25 London Business Days following perfection pursuant to CLAUSE 6.1,
the Seller will do such of the acts or things referred to in CLAUSES 6.2 to
6.5 as the Security Trustee or the Mortgages Trustee requires the Seller to
do.
6.7 The Seller shall indemnify each of the Mortgages Trustee, Funding 1 and the
Security Trustee from and against any and all costs, fees and expenses
(including, without limitation, legal fees and expenses and any applicable
Value Added Tax thereon) which may be incurred by the Mortgages Trustee
and/or Funding 1 and/or the Security Trustee by reason of the doing of any
act, matter or thing referred to in this CLAUSE 6 and CLAUSE 7.5.
7. UNDERTAKINGS
7.1 The Mortgages Trustee and Funding 1 undertake to the Seller that they will
at all times (or will direct the Servicer at all times to) use reasonable
endeavours to administer and enforce (and exercise their powers and rights
and perform their obligations under) the Loans comprised in the Portfolio
and their Related Security in accordance with the Seller's Policy (for so
long as it exists and thereafter in accordance with such policies as would
be applied by a reasonable, prudent mortgage lender in the conduct of its
business), provided that if the Seller fails to comply with its obligations
to repurchase any Loan and its Related Security pursuant to CLAUSE 8.5 the
Mortgages Trustee shall be entitled to waive any Early Repayment Fee in
respect of such Loan and its Related Security if, in the Mortgages
Trustee's reasonable opinion, such waiver is reasonably necessary in order
to effect an interest rate change.
7.2 The Seller hereby undertakes to the Mortgages Trustee and Funding 1 that,
in the event that any Borrower establishes that it has at any time prior to
the Initial Closing Date or, as the case may be, the relevant Sale Date,
paid to the Seller any amounts in excess of sums due to the Seller as at
the date of payment under the Mortgage Conditions applicable to that Loan,
the Seller will reimburse the Borrower for such overpayment together with
any interest, cost or other expense associated therewith. The Seller
further agrees to hold the Mortgages Trustee and Funding 1 harmless against
any such claims and to indemnify the Mortgages Trustee and Funding 1 on an
after Tax basis in relation to any costs, expense, loss or other claim
which may arise in connection therewith. Any payment made by the Seller to
the Mortgages Trustee and Funding 1 in discharge of the foregoing indemnity
shall be regarded as a rebate of part of the Purchase Price of the relevant
Loan.
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7.3 Each of the Seller and the Mortgages Trustee and Funding 1 undertakes to
each other and to the Security Trustee that if and to the extent that any
determination shall be made by any court or other competent authority or
any ombudsman in respect of any Loan and its Related Security that:
(a) any term which relates to the recovery of interest under the Standard
Documentation applicable to that Loan and its Related Security is
unfair; or
(b) the interest payable under any Loan is to be set by reference to HVR 1
or HVR 2 (as applicable) (and not a rate set by the Seller's
successors or assigns or those deriving title from them); or
(c) the variable margin above the Bank of England repo rate under any
Tracker Rate Loan must be set by the Seller (rather than by its
successors or assigns or those deriving title from them); or
(d) the interest payable under any Loan is to be set by reference to an
interest rate other than that set or purported to be set by either the
Servicer or the Mortgages Trustee as a result of the Seller having
more than one variable mortgage rate,
then, at Funding 1's direction (subject to the prior written consent of the
Security Trustee), the Mortgages Trustee will serve upon the Seller a
notice in the form of the Loan Repurchase Notice requiring the Seller to
repurchase the relevant Loan and all other Loans under the relevant
Mortgage Account and its Related Security in accordance with CLAUSE 8.5
(but in the case of a determination in respect of (b) above, only if at any
time on or after such determination, HVR 1 or HVR 2 (as applicable) shall
be below or shall fall below the standard variable rate of interest set by
such successors or assigns or those deriving title from them).
7.4 The Seller hereby undertakes to the Mortgages Trustee, Funding 1 and the
Security Trustee that:
(a) if the long term unsecured, unsubordinated and unguaranteed debt
obligations of the Seller cease to be assigned a rating of [Baa2] or
higher from Xxxxx'x and [BBB] or higher from S&P and [BBB] or higher
from Fitch, the Seller shall deliver to the Mortgages Trustee, Funding
1, the Security Trustee and the Rating Agencies a draft letter of
notice to each of the Borrowers of the sale and purchase effected by
this Agreement; and
(b) if the long term unsecured, unsubordinated and unguaranteed debt
obligations of the Seller cease to be assigned a rating of [Baa3] or
higher from Xxxxx'x and [BBB-] or higher from S&P and [BBB-] or higher
from Fitch, then the Seller shall, within 20 London Business Days of
it becoming aware of such a rating being assigned, give notice of the
sale and purchase effected by this Agreement to each Borrower.
7.5 The Seller undertakes to the Mortgages Trustee, Funding 1 and the Security
Trustee that, pending perfection under CLAUSE 6, the Seller:
(a) shall not do or omit to do any act or thing which might, in the
reasonable opinion of the Security Trustee, prejudice the interests of
the Mortgages Trustee, Funding 1 and/or the Security Trustee in the
Portfolio;
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(b) shall promptly notify the Mortgages Trustee, Funding 1 and the
Security Trustee in writing if it receives written notice of any
litigation or claim calling into question in any material way the
Seller's or the Mortgages Trustee's title to any Loan comprised in the
Portfolio or its Related Security or if it becomes aware of any
material breach of any of the Representations and Warranties or other
obligations under this Agreement;
(c) shall, if reasonably required so to do by the Mortgages Trustee or the
Security Trustee, participate or join in any legal proceedings to the
extent necessary to protect preserve and enforce the Seller's or the
Mortgages Trustee's or Funding 1's or the Security Trustee's title to
or interest in any Loan or its Related Security;
(d) shall use all reasonable endeavours to obtain as soon as reasonably
possible:
(i) the title number to each Property in respect of which a Mortgage
is registered at the Land Registry to the extent that such title
number does not appear in the Exhibit to this Agreement (or, as
the case may be, the relevant New Portfolio Notice); and
(ii) the title number to each Property in respect of which a Mortgage
is registered in the Land Register of Scotland to the extent that
such title number does not appear in the Exhibit to this
Agreement (or, as the case may be, the relevant New Portfolio
Notice); and
(e) shall make and enforce claims under the Buildings Policies and the
Halifax Insurance Policies and hold the proceeds of such claims on
trust for the Mortgages Trustee or as the Mortgages Trustee may
direct.
7.6 The Seller hereby further undertakes to the Mortgages Trustee and Funding 1
that it is and at all times shall remain solely responsible for funding any
Delayed Cashbacks and any Home Cash Reserve Drawings and Flexible Loan
Drawings (if any) made by a Borrower and for funding any request for any
Further Advance made by a Borrower and, for the avoidance of doubt, neither
the Mortgages Trustee nor Funding 1 will be required to advance moneys to
the Seller or to a Borrower in order to fund such a Delayed Cashback, Home
Cash Reserve Drawing, Flexible Loan Drawing (if any), or Further Advance in
any circumstances whatsoever.
7.7 The Seller shall grant security powers of attorney to the Mortgages
Trustee, Funding 1 and the Security Trustee in the form set out in SCHEDULE
5 allowing any of the Mortgages Trustee, Funding 1 and the Security Trustee
and their delegates from time to time (inter alia) to set the Seller's
Variable Base Rate in the circumstances referred to in CLAUSE 4 of the
Servicing Agreement and/or following perfection pursuant to CLAUSE 6.1
PROVIDED THAT nothing in this CLAUSE 7.7 shall prevent the Seller (or any
of its attorneys from time to time) from setting a higher Seller's Variable
Base Rate than those set or to be set or required or to be required by the
Mortgages Trustee, Funding 1 or the Security Trustee.
8. WARRANTIES AND REPURCHASE BY THE SELLER
8.1 (a) The Seller hereby makes the Representations and Warranties:
14
(i) in respect of each Loan and its Related Security in the Initial
Portfolio as at the date hereof and on the Initial Closing Date;
and
(ii) in relation to each New Loan and its Related Security in a New
Portfolio, on the date of the service of the relevant New
Portfolio Notice and on the relevant Sale Date.
(b) Each statement comprised in the Representations and Warranties shall
be construed as a separate statement and (save as expressly provided
to the contrary) shall not be limited or restricted by reference to or
inference from the terms of any other such statement.
(c) The Seller acknowledges:
(i) that the Representations and Warranties are made with a view to
inducing the Mortgages Trustee, Funding 1 and the Security
Trustee (as the case may be) either to enter into this Agreement
and the other Transaction Documents to which is a party or to
agree to purchase the New Loans and their Related Security
comprised in each New Portfolio, and
(ii) that each of the Mortgages Trustee, Funding 1 and the Security
Trustee has entered into this Agreement and the other
Transaction Documents to which it is a party in reliance upon
the Representations and Warranties notwithstanding any
information in fact possessed or discoverable by the Mortgages
Trustee, Funding 1 and/or the Security Trustee or otherwise
disclosed to any of them, and
(iii) that prior to entering into this Agreement and the other
Transaction Documents to which each is a party neither the
Mortgages Trustee nor Funding 1 nor the Security Trustee has
made any enquiries of any matter.
8.2 The Mortgages Trustee's, Funding 1's and the Security Trustee's sole remedy
in respect of a breach of any of the Representations and Warranties shall
be to take action under this CLAUSE 8 or under CLAUSE 6 of the Mortgages
Trust Deed.
8.3 In the event of a material breach of any of the Representations or
Warranties in respect of any Loan and/or its Related Security made under
CLAUSE 8.1 or if any of those Representations or Warranties proves to be
materially untrue as at the Initial Closing Date or, as the case may be,
the relevant Sale Date, and provided that:
(a) the Mortgages Trustee has given the Seller not less than 20 London
Business Days' notice in writing;
(b) the Mortgages Trustee has obtained the prior written consent of the
Security Trustee; and
(c) such breach or untruth, where capable of remedy, is not remedied to
the reasonable satisfaction of Funding 1 and the Security Trustee
within the 20 London Business Days period referred to in (a) (or such
longer period as Funding 1 and the Security Trustee may direct the
Mortgages Trustee in writing),
15
then at Funding 1's direction (subject to the prior written consent of the
Security Trustee) the Mortgages Trustee shall serve upon the Seller a
notice in the form of the Loan Repurchase Notice requiring the Seller to
repurchase the relevant Loan and its Related Security (and any other Loan
secured or intended to be secured by that Related Security or any part of
it) in accordance with CLAUSE 8.5.
8.4 (a) If the Seller accepts an application from, or makes an offer (which is
accepted) to, a Borrower for a Further Advance then (save in the case
of any Loan which is then in arrears), at Funding 1's direction
(subject to the prior written consent of the Security Trustee), the
Mortgages Trustee will serve upon the Seller a notice in the form of
the Loan Repurchase Notice requiring the Seller to repurchase the
relevant Loan and its Related Security (and any other Loan secured or
intended to be secured by that Related Security or any part of it) in
accordance with CLAUSE 8.5.
(b) If the Seller accepts an application from, or makes an offer (which is
accepted) to, a Borrower for a Product Switch and (except as provided
in paragraph (c) below) on the immediately preceding Distribution
Date, the Seller is in breach of the conditions referred to in CLAUSES
4.2(A) to (P) inclusive as if references therein to NEW LOANS and NEW
PORTFOLIO were references to the Loan which would result from the
implementation of such Product Switch and as if references to SALE
DATE were references to the date when the Seller and relevant Borrower
complete such Product Switch then (save in the case of any Loan which
is then in arrears) from and including the relevant Distribution Date
to but excluding the date when such conditions have been satisfied, at
Funding 1's direction (subject to the prior written consent of the
Security Trustee), the Mortgages Trustee will serve upon the Seller a
notice in the form of the Loan Repurchase Notice requiring the Seller
to repurchase the relevant Loan and its Related Security (and any
other Loan secured or intended to be secured by that Related Security
or any part of it) in accordance with CLAUSE 8.5.
(c) If the Seller accepts an application from, or makes an offer (which is
accepted) to, a Borrower for a Product Switch, the effect of which is
to extend the final maturity date of the relevant Loan beyond [June
2040] then, at Funding 1's direction (subject to the prior written
consent of the Security Trustee), the Mortgages Trustee will serve
upon the Seller a notice in the form of the Loan Repurchase Notice
requiring the Seller to repurchase the relevant Loan and its Related
Security in accordance with CLAUSE 8.5 notwithstanding that the
conditions referred to in CLAUSES 4.2(A) to 4.2(P) have been
satisfied.
(d) For the avoidance of doubt, the Seller shall not accept an application
from nor make an offer (which is accepted) to a Borrower for a Further
Advance or a Product Switch if the relevant Loan to which such Further
Advance or Product Switch relates is then in arrears subject only to
such exceptions as made on a case by case basis as would be acceptable
to a reasonable, prudent mortgage lender.
8.5 Upon receipt of a Loan Repurchase Notice duly signed on behalf of the
Mortgages Trustee, the Seller shall sign and return a duplicate copy and
shall repurchase from the Mortgages Trustee, and the Mortgages Trustee
shall re-assign or re-transfer to the Seller free from the Security
Interests created by the Funding 1 Deed of Charge and the Second
Supplemental Funding 1 Deed of Charge, the relevant Loan (and any other
Loan secured or intended to be secured by that Related Security or any part
of it) and their Related Security. Completion of such repurchase shall take
place on the Distribution Date after receipt by the Seller of such
16
Loan Repurchase Notice or such other date as the Mortgages Trustee may
direct in the Loan Repurchase Notice (provided that the date so specified
by the Mortgages Trustee shall not be later than 90 days after receipt by
the Seller of such notice) when the Seller shall pay to the Mortgages
Trustee GIC Account (or as the Mortgages Trustee shall direct) an amount
equal to the aggregate Outstanding Principal Balance of such Loan or Loans
and any Related Security and all Arrears of Interest and Accrued Interest
relating thereto (save for the repurchase of any Loan and its Related
Security which is subject to a Further Advance or a Product Switch pursuant
to CLAUSE 8.4 in which case the Seller shall pay to the Mortgages Trustee
GIC Account (or as the Mortgages Trustee shall direct) an amount equal to
the aggregate Outstanding Principal Balance of such Loan and its Related
Security and Accrued Interest relating thereto only) as at the date of such
repurchase and the provisions of CLAUSE 8.6 shall apply.
8.6 On the date of completion of any repurchase of a Loan and its Related
Security in accordance with CLAUSE 8.5 above, the Security Trustee, the
Mortgages Trustee and Funding 1 shall at the cost of the Seller execute and
deliver, or cause their respective duly authorised attorneys to execute and
deliver, to the Seller:
(a) a memorandum of release of such Loan and its Related Security from the
security constituted by the Funding 1 Deed of Charge and the Second
Supplemental Funding 1 Deed of Charge in a form reasonably acceptable
to the Seller;
(b) in relation to the English Mortgages, if perfection of the assignment
to the Mortgages Trustee has occurred in accordance with CLAUSE 6:
(i) if the relevant English Mortgage is over Registered Land, a
transfer of such Mortgage to the Seller in the form of the
Registered Transfer; or
(ii) if the relevant English Mortgage is over Unregistered Land, a
transfer of such English Mortgage to the Seller in the form of
the Unregistered Transfer;
(c) in relation to the Scottish Mortgages, if perfection of the
assignation to the Mortgages Trustee has occurred in accordance with
CLAUSE 6:
(i) if the relevant Scottish Mortgage is over a Property title to
which is registered in the Land Register of Scotland, an SLR
Transfer by the Mortgages Trustee in favour of the Seller; and
(ii) if the relevant Scottish Mortgage is over a Property title to
which is registered in the General Register of Sasines, a Sasine
Transfer by the Mortgages Trustee in favour of the Seller.
(d) a re-assignment or retrocession (as appropriate) of the rights of the
Mortgages Trustee in respect of the relevant Related Security each in
a form reasonably acceptable to the Seller (which shall, in the case
of the re-assignment of the MIG Policies, be substantially in the form
of the Assignment of MIG Policies); and
(e) a notification to the Servicer that all further sums due in respect of
such repurchased Loan are for the Seller's account.
17
Upon such completion the Seller shall cease to be under any further
obligation to hold any Title Deeds or other documents relating to such Loan
or Loans and its/their Related Security to the order of the Mortgages
Trustee and if the Mortgages Trustee holds the Title Deeds it will return
them to the Seller. Any repurchase by the Seller of or in respect of a Loan
or Loans and its or their Related Security shall constitute a discharge and
release of the Seller from any claims which the Mortgages Trustee and/or
Funding 1 or the Security Trustee may have against the Seller arising from
the relevant Representation or Warranty in relation to that Loan or Loans
and its or their Related Security only but shall not affect any rights
arising from a breach of any other express provision of this Agreement or
any Representation or Warranty in relation to any other Loan and other
Related Security.
8.7 After the Seller becomes aware of any event and/or fact which may
reasonably give rise to an obligation under any clause of this Agreement to
repurchase any Loan it shall notify the Mortgages Trustee, Funding 1 and
the Security Trustee in writing thereof as soon as reasonably practicable.
8.8 The terms of this CLAUSE 8 shall not prejudice the rights of the Mortgages
Trustee or the Beneficiaries under the Mortgages Trust Deed.
8.9 The parties to this Agreement may, with the prior written consent of the
Security Trustee, waive or amend the Representations and Warranties. In
determining whether to give its consent to the proposed waiver or
amendments to the Representations and Warranties, the Security Trustee
shall exercise its discretion in accordance with the terms of CLAUSE 25.8
of the Funding 1 Deed of Charge.
9. OTHER WARRANTIES
On the date of this Agreement, the Closing Date, and each Sale Date, the
Seller represents and warrants to each of the Mortgages Trustee, Funding 1
and the Security Trustee that:
(a) the Seller has not acquired or owned or possessed any rights in any
Issuer, the Mortgages Trustee or Funding 1 such that it would CONTROL
such Issuer within the meaning of Section 416 ICTA 1988; and
(b) there is not any CONNECTION (within the meaning of Section 87 Finance
Act 1996) between any Issuer and any Borrower.
10. FURTHER ASSURANCE
The parties hereto agree that they will co-operate fully to do all such
further acts and things and execute any further documents that may be
necessary or desirable to give full effect to the transactions contemplated
by this Agreement (but subject always to CLAUSE 6).
11. CONSEQUENCES OF BREACH
Without prejudice to CLAUSES 7 and 8, Funding 1, the Mortgages Trustee and
the Security Trustee severally acknowledge to and agree with the Seller,
and the Security Trustee acknowledges to and agrees with Funding 1 and the
Mortgages Trustee, that the Seller shall have no liability or
responsibility (whether, in either case, contractual or tortious, express
or implied) for any loss or damage for or in respect of any breach of, or
any act or omission in respect of, any of its obligations hereunder other
than loss or damage directly (and not
18
indirectly or consequentially) suffered by the Mortgages Trustee and/or
Funding 1 or the assets comprised in the Funding 1 Security constituted by
the Funding 1 Deed of Charge by reason of such breach, act or omission. For
this purpose (and without limiting the scope of the above exclusion in
respect of indirect or consequential loss or damage) any loss or damage
suffered by the Mortgages Trustee and/or Funding 1 or such assets as a
result of the breach, act or omission in question also having been or given
rise to an Event of Default or enforcement of the Funding 1 Security
contributed by the Funding 1 Deed of Charge shall be treated as indirect or
consequential loss or damage PROVIDED THAT this sentence shall not apply to
any direct or non-consequential loss or damage arising from any such
breach, act or omission.
12. SUBORDINATION
The Seller agrees with Funding 1, the Mortgages Trustee and the Security
Trustee that on the enforcement of any Mortgage any sums owed to the Seller
by a Borrower and which are secured under such Mortgage and the rights and
remedies of the Seller in respect of the sums owed to the Seller shall at
all times be subject and subordinated to any sums owed to the Mortgages
Trustee by the Borrower and which are secured under such Mortgage and to
the rights and remedies of the Mortgages Trustee in respect of such sums
owed to the Mortgages Trustee by the Borrower.
13. NON-MERGER
Any term of this Agreement to which effect is not given on the Initial
Closing Date or on any Sale Date (including in particular, but without
limitation, the liability of the Seller under the Representations and
Warranties and the indemnity in CLAUSE 6.7 and the provisions of CLAUSE 4)
shall not merge and shall remain in full force and effect notwithstanding
the sale and purchases contemplated by this Agreement.
14. NO AGENCY OR PARTNERSHIP
It is hereby acknowledged and agreed by the parties that nothing in this
Agreement shall be construed as giving rise to any relationship of agency,
save as expressly provided herein, or partnership between the parties and
that in fulfilling its obligations hereunder, each party shall be acting
entirely for its own account.
15. PAYMENTS
Except as otherwise specifically provided, all payments to be made pursuant
to this Agreement shall be made in sterling in immediately available funds
without exercising or seeking to exercise any right of set-off as may
otherwise exist and shall be deemed to be made when they are received by
the payee and shall be accounted for accordingly unless failure to receive
any payment is due to an error by the payee's bank.
16. WAIVER AND VARIATION
16.1 Exercise or failure to exercise any right under this Agreement shall not,
unless otherwise herein provided, constitute a waiver of that or any other
right.
16.2 Subject to CLAUSE 25 of the Funding 1 Deed of Change any amendments to this
Agreement will be made only with the prior written consent of each party to
this Agreement.
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17. NOTICES
Any notices to be given pursuant to this Agreement to any of the parties
hereto shall be in writing and shall be sufficiently served if sent by
prepaid first class post, by hand or by facsimile transmission and shall be
deemed to be given (in the case of facsimile transmission) when despatched
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 Halifax plc, Xxxxxxx Xxxx, Xxxxxxx, Xxxx
Xxxxxxxxx XX0 0XX (LP/3/3/SEC) (facsimile number x00 (0) 000 000 0000)
for the attention of the Head of Mortgage Securitisation with a copy
to HBOS Treasury Services PLC, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
(facsimile number x00 (0)00 0000 0000) for the attention of Head of
Capital Markets and Securitisation;
(b) in the case of Funding 1: to Permanent Funding (No. 1) Limited,
Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (facsimile number +44
(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 number x00 (0)00 0000 0000) for the attention of Head of
Capital Markets and Securitisation;
(c) in the case of the Mortgages Trustee: to Permanent Mortgages Trustee
Limited, 00 Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX, (facsimile number
x00 (0) 0000 000000) for the attention of the Secretary with a copy to
HBOS Treasury Services PLC, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
(facsimile number x00 (0)00 0000 0000) for the attention of Head of
Capital Markets and Securitisation; and
(d) in the case of the Security Trustee: to The Bank of Xxx Xxxx, Xxx
Xxxxxx Xxxxxx, Xxxxxx X00 0XX (facsimile number + 44 (0)20 7964
6061/6399) for the attention of Global Structural Finance - Corporate
Trust,
or to such other address or facsimile number or for the attention of such
other person or entity as may from time to time be notified by any party to
the others by written notice in accordance with the provisions of this
CLAUSE 17.
18. ASSIGNMENT
18.1 Subject always to the provisions of CLAUSE 19, no party hereto shall be
entitled to assign all or any part of its rights or obligations hereunder
to any other party without the prior written consent of each of the other
parties hereto (which shall not, if requested, be unreasonably withheld)
save that Funding 1 shall be entitled to assign whether by way of security
or otherwise all or any of its rights under this Agreement without such
consent to the Security Trustee pursuant to the Funding 1 Deed of Charge
and the Security Trustee may at its sole discretion assign all or any of
its rights under or in respect of this Agreement without such consent to
any successor Security Trustee in exercise of its rights under the Funding
1 Deed of Charge.
18.2 The Seller acknowledges that on the assignment pursuant to the Funding 1
Deed of Charge by Funding 1 to the Security Trustee of Funding 1's rights
under this Agreement the Security Trustee may enforce such rights in the
Security Trustee's own name without joining Funding 1 in any such action
(which right the Seller hereby waives) and the Seller hereby waives as
20
against the Security Trustee any rights or equities in its favour arising
from any course of dealing between the Seller and Funding 1.
19. CHANGE OF SECURITY TRUSTEE
19.1 If there is any change in the identity of the Security Trustee in
accordance with the Funding 1 Deed of Charge, the Seller, the Mortgages
Trustee and Funding 1 shall execute such documents and take such action as
the successor Security Trustee and the outgoing Security Trustee may
reasonably require for the purpose of vesting in the successor Security
Trustee the rights and obligations of the outgoing Security Trustee
hereunder and releasing the outgoing Security Trustee from its future
obligations under this Agreement and the Seller shall give notice thereof
to the Rating Agencies.
19.2 It is hereby acknowledged and agreed that by its execution of this
Agreement the Security Trustee shall not assume or have any of the
obligations or liabilities of the Seller or Funding 1 or the Mortgages
Trustee hereunder.
20. NOT USED
21. THIRD PARTY RIGHTS
A person who is not a party to this agreement may not enforce any of its
terms under the Contracts (Rights of Third Parties) Xxx 0000.
22. GOVERNING LAW
22.1 This Agreement shall be governed by the laws of England (provided that any
terms of this Agreement which are particular to Scots law shall be
construed in accordance with the laws of Scotland).
22.2 Each party to this Agreement hereby irrevocably submits to the
non-exclusive jurisdiction of the English courts in any action or
proceeding arising out of or relating to this Agreement, and hereby
irrevocably agrees that all claims in respect of such action or proceeding
may be heard and determined by such courts. Each party to this Agreement
hereby irrevocably waives, to the fullest extent it may possibly do so, any
defence or claim that the English courts are an inconvenient forum for the
maintenance or hearing of such action or proceeding. The Mortgages Trustee
irrevocably appoints Structured Finance Management Limited of Xxxxxxxxx
Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX as its agent for service of process.
IN WITNESS WHEREOF the parties hereto have executed this Agreement on the day
and year first before written.
SIGNED by )
as attorney for )
HALIFAX PLC in the presence of ) ...............................
Witness's Signature: ..........................
Name: ..........................
Address: ..........................
21
SIGNED by )
for and on behalf of )
PERMANENT FUNDING (NO. 1) LIMITED ) ...............................
SIGNED by )
for and on behalf of )
PERMANENT MORTGAGES )
TRUSTEE LIMITED ) ...............................
SIGNED by )
for and on behalf of )
THE BANK OF NEW YORK ) ...............................
22
SCHEDULE 1
REPRESENTATIONS AND WARRANTIES
1. LOANS
1.1 The particulars of the Loans set out in the Exhibit (or, as the case may
be, the relevant New Portfolio Notice and in each Scottish Declaration of
Trust) are true, complete and accurate in all material respects.
1.2 Each Loan was originated by the Seller and was originated and is
denominated in pounds sterling (or was originated and is denominated in
euro if the euro has been adopted as the lawful currency for the time being
of the United Kingdom).
1.3 Each Loan in the Portfolio as at the Sixth Issuer Closing Date was made not
earlier than [1stFebruary, 1996 and not later than 1st August, 2004].
1.4 Each Loan matures for repayment not later than [June 2040].
1.5 No Loan has an Outstanding Principal Balance of more than [[GBP]500,000].
1.6 The Lending Criteria are the lending criteria applicable to the Loans and
their Related Security.
1.7 Prior to the making of each Initial Advance and Further Advance:
(a) the Lending Criteria and all preconditions to the making of any Loan
were satisfied in all material respects subject only to such
exceptions as made on a case by case basis as would be acceptable to a
reasonable, prudent mortgage lender; and
(b) the requirements of the relevant MIG Policy were met, so far as
applicable to that Loan.
1.8 (a) Each Loan was made and its Related Security taken or received
substantially on the terms of the Standard Documentation without any
material variation thereto and nothing has been done subsequently to
add to, lessen, modify or otherwise vary the express provisions of any
of the same in any material respect.
(b) The brochures, application forms, offers, offer conditions and
marketing material distributed by the Seller to the Borrower when
offering a Loan to a Borrower:
(i) do not conflict in any material respect with the terms applicable
to the relevant Loan and its Related Security at the time that
the Loan was entered into;
(ii) do not conflict with and would not prohibit or otherwise limit
the terms of, the Transaction Documents or the matters
contemplated thereby, including for the avoidance of doubt and
without limitation:
23
(A) the assignment or assignation (as appropriate) of the Loans
and their Related Security to the Mortgages Trustee or the
placing of the Loans and their Related Security into trust;
(B) the administration of the Loans and their Related Security
by the Servicer or a delegate of the Servicer or (for as
long as the Seller and the Servicer are the same legal
entity) the appointment of a new Servicer following the
occurrence of an Insolvency Event in relation to the Seller;
and
(C) so far as the Seller is aware to the best of its knowledge,
information and belief, the ability of the Mortgages Trustee
or the Security Trustee to set the variable rate payable
under any Variable Rate Loan independently of (and without
regard to the level of) the Seller's standard variable rate
of interest or if the Seller has more than one standard
variable rate of interest, the relevant Seller's standard
variable rate of interest, subject to any applicable cap on
that variable rate which is not itself linked to any rate
set by the Seller and to set the variable margin above the
Bank of England repo rate under any Tracker Rate Loan
independently of (and without regard to the level of) any
differential set by the Seller, subject to any applicable
cap on that variable margin above the Bank of England repo
rate which is not itself linked to any margin set by the
Seller.
(c) There is no restriction on the Seller's successors and assigns and
assignees to the legal title of the Loans (including, without
limitation, the Mortgages Trustee if and when legal title to the Loans
is transferred to it) right:
(i) to set the variable rate payable under any Variable Rate Loan
independently of (and without regard to the level of) the
Seller's standard variable rate of interest or if the Seller has
more than one standard variable rate of interest, the relevant
Seller's standard variable rate of interest, subject to any
applicable cap on that variable rate which is not itself linked
to any rate set by the Seller (subject to complying with the
obligations under the Standard Documents as to changes in
interest rates generally and so that in particular the successors
will not be able to change the interest rate following a transfer
of legal title unless the reasons for changing the interest rate
set out in the Standard Documents apply) and provided that in
relation to Loans which are subject to HVR 2, the differential
between that rate and the Loans which are subject to HVR 1 is
maintained; and
(ii) to set the variable margin above the Bank of England repo rate
under any Tracker Rate Loan independently of (and without regard
to the level of) any differential set by the Seller, subject to
any applicable cap on that variable margin above the Bank of
England repo rate which is not itself linked to any margin set by
the Seller (subject to complying with the obligations under the
Standard Documents as to changes in margins generally and so that
in particular the successors will not be able to change the
margin following a transfer of legal title unless the reasons for
changing the margin set out in the Standard Documents apply).
24
1.9 The Seller is under no obligation to make Further Advances (other than
Flexible Loan Drawings (if any), Delayed Cashbacks and Home Cash Reserve
Drawings) or to release retentions or to pay fees or other sums relating to
any Loan or its Related Security to any Borrower.
1.10 Each Borrower has made at least two Monthly Payments in respect of each
Loan.
1.11 Other than with respect to monthly interest payments or as provided in
paragraph 1.12 below, no Borrower is or has, since the date of the relevant
Mortgage, been in material breach of any obligation owed in respect of the
relevant Loan or under the Related Security and accordingly no steps have
been taken by the Seller to enforce any Related Security.
1.12 The total amount of arrears of interest or principal, together with any
fees, commissions and premiums payable at the same time as such interest
payment or principal repayment, on any Loan is not on the Initial Closing
Date or the relevant Sale Date (as applicable), nor has been during the 12
months immediately preceding the Initial Closing Date or the relevant Sale
Date (as applicable) more than the amount of the Monthly Payment then due.
1.13 No Loan is guaranteed by a third party save where the guarantee constitutes
legal, valid and binding obligations of the guarantor enforceable in
accordance with their terms.
1.14 The Outstanding Principal Balance, all Accrued Interest and all Arrears of
Interest on each Loan and its Related Security (other than any agreement
for Flexible Loan Drawings (if any), Delayed Cashbacks, Home Cash Reserve
Drawings and any other Further Advances) constitute a legal, valid, binding
and enforceable debt due to the Seller from the relevant Borrower and the
terms of each Loan and its Related Security constitute valid and binding
obligations of the Borrower enforceable in accordance with their terms
(other than any agreement for Flexible Loan Drawings (if any), Delayed
Cashbacks, Home Cash Reserve Drawings and any other Further Advance).
1.15 Interest on each Loan is charged in accordance with the Standard
Documentation.
1.16 Interest on each Loan is payable monthly in arrear.
1.17 Each Loan and its Related Security is valid, binding and enforceable in
accordance with its terms and is non-cancellable:
(i) save in relation to any term in any Loan or in its Related Security,
in each case which is not binding by virtue of the Unfair Terms in
Consumer Contracts Regulations 1994 or (as the case may be) the Unfair
Terms in Consumer Contacts Regulations 1999; and
(ii) save in relation to any Flexible Loan Drawing, Delayed Cashback, Home
Cash Reserve Drawing, and any other Further Advance, in each case
which is not enforceable by virtue of the Consumer Credit Xxx 0000.
To the best of the Seller's knowledge, none of the terms in any Loan or in
its Related Security is not binding by virtue of its being unfair within
the meaning of the Unfair Terms in Consumer Contracts Regulations 1994 or
(as the case may be) the Unfair Terms in Consumer Contracts Regulations
1999. In this Warranty 1.17, reference to any legislation shall be
25
construed as a reference to that legislation as amended, extended or
re-enacted from time to time.
1.18 All of the Borrowers are individuals and were aged 18 years or older at the
date he or she executed the relevant Mortgage.
1.19 Not used.
1.20 Each loan in the relevant Portfolio is either:
(a) a Variable Rate Loan, Tracker Rate Loan or Fixed Rate Loan; or
(b) a New Loan Type which each of the Rating Agencies has confirmed in
writing may be included in the relevant New Portfolio.
2. MORTGAGES
2.1 The whole of the Outstanding Principal Balance on each Loan and any Arrears
of Interest and all Accrued Interest is secured by a Mortgage.
2.2 Each Mortgage is in the form of the pro forma contained in the Standard
Documentation which was applicable at the time the Mortgage was executed.
2.3 Each Mortgage constitutes a valid and subsisting first charge by way of
legal mortgage or (in the case of Scottish Mortgages) first ranking
standard security over the relevant Property subject only in certain
appropriate cases to applications for registration or recording at the Land
Registry or Registers of Scotland which where requisite have been made and
are pending and in relation to such cases the Seller is not aware of any
caution, notice, inhibition or any other matter that would prevent such
registration or recording.
2.4 Each Mortgage has first priority for the whole of the Outstanding Principal
Balance on the Loan and all Arrears of Interest and Accrued Interest
thereon and all future interest, fees, costs and expenses payable under or
in respect of such Mortgage.
2.5 The Seller has complied and will comply, in all material respects, with
all applicable laws and regulations, including without limitation the FSA's
rules in MCOB, in respect of its orgination of the Loan and Mortgages.
2.6 Each Loan and its Related Security (excluding the Flexible Loan Drawings
(if any), Delayed Cashbacks, Home Cash Reserve Drawings and any other
Further Advances) is, save in relation to any Loan and Related Security
which is not binding by virtue of the Unfair Terms in Consumer Contracts
Regulations 1994 or (as the case may be) the Unfair Terms in Consumer
Contracts Regulations 1999, valid and binding and enforceable in accordance
with its terms. To the best of the Seller's knowledge, none of the Loans or
their Related Security is not binding by virtue of its being unfair
pursuant to the Unfair Terms in Consumer Contracts Regulations 1994 or (as
the case may be) the Unfair Terms in Consumer Contracts Regulations 1999.
3. THE PROPERTIES
3.1 All of the Properties are in England, Wales or Scotland.
3.2 Each Property constitutes a separate dwelling unit (subject to limited case
by case exceptions) and is either freehold, leasehold or (in Scotland)
heritable or held under a long lease.
26
3.3 Save for children of Borrowers and children of someone living with the
Borrower, every person who, at the date upon which any English Mortgage was
granted, had attained the age of eighteen and was in or about to be in
actual occupation of the relevant Property, is either named as a Borrower
or has signed a Deed of Consent in the form of the pro forma contained in
the Standard Documentation which was applicable at the time the Mortgage
was executed.
3.4 At the date upon which any Scottish Mortgage was granted all necessary MHA
Documentation had been obtained so as to ensure that neither that Scottish
Mortgage nor the related Property is subject to or affected by any
statutory right of occupancy under the Matrimonial Homes (Family
Protection) (Scotland) Xxx 0000.
3.5 No Property has been let otherwise than by way of:
(b) an assured shorthold tenancy which meets the requirements of Section
19A or Section 20 of the Housing Xxx 0000; or
(c) a short assured tenancy which meets the requirements of section 32 of
the Housing (Scotland) Xxx 0000; or
(d) an assured tenancy;
in each case which meets the Seller's Policy in connection with lettings to
non-owners.
3.6 No Property is the subject of a shared ownership lease arrangement or
staircase purchasing arrangement.
4. VALUERS' AND SOLICITORS' REPORTS
4.1 Not more than twelve months (or a longer period as may be acceptable to a
reasonable, prudent mortgage lender) prior to the grant of each Mortgage
(or such longer period as may be acceptable to a reasonable, prudent
mortgage lender) the Seller received a Valuation Report from a Valuer on
the relevant Property (or such other form of report concerning the
valuation of the relevant Property as would be acceptable to a reasonable,
prudent mortgage lender), the contents of which were such as would be
acceptable to a reasonable, prudent mortgage lender.
4.2 The principal amount of the Initial Advance (including any retention(s)
subsequently advanced to the Borrower but disregarding Capitalised
Expenses) is either:
(a) not more than [75] per cent. of the lower of the purchase price and
the appraised value of the Property as stated in the Valuation Report
referred to above in paragraph 4.1 (the APPRAISED VALUE) (or, in case
of a remortgage, of the appraised value) of the Property; or
(b) greater than [75] per cent. (but not more than [97] per cent.) of the
lower of the purchase price and the appraised value (or, in the case
of a remortgage, of the appraised value), in which case for those
Loans originated prior to 1st January, 2001 only that part of the
Initial Advance which exceeds [75] per cent. of the lower of the
purchase price and the appraised value (or, in the case of a
remortgage, of the appraised value) is covered under the terms of a
MIG Policy.
27
4.3 Prior to the taking of each Mortgage (other than a remortgage), the Seller:
(a) instructed the Seller's solicitor, licensed conveyancer or (in
Scotland) qualified conveyancer to carry out an investigation of title
to the relevant Property and to undertake such other searches,
investigation, enquiries and other actions on behalf of the Seller as
are set out in the instructions which the Seller issued to the
relevant solicitor as are set out in:
(i) the CML's Lenders' Handbook for England and Wales in relation to
English Mortgages;
(ii) the Seller's Mortgage Practice Notes in relation to Scottish
Mortgages taken before the CML's Lenders' Handbook for Scotland
was adopted in 2000; or
(iii) the CML's Lenders' Handbook for Scotland in relation to Scottish
Mortgages taken after the CML's Lenders' Handbook for Scotland
was adopted in 2000,
(or such comparable, predecessor or successor instructions and/or
guidelines as may for the time being be in place), subject only to
such variations made on a case by case basis as would have been
acceptable to a reasonable, prudent mortgage lender at the relevant
time; or
(b) received a Certificate of Title from the solicitor or licensed
conveyancer or (in Scotland) qualified conveyancer referred to in
paragraph (a) relating to such Property the contents of which were
such as would have been acceptable to a reasonable, prudent mortgage
lender at that time.
4.4 The benefit of all Valuation Reports, any other valuation report referred
to in paragraph 4.1 and Certificates of Title which were provided to the
Seller not more than two years prior to the date of this Agreement can be
validly assigned to the Mortgages Trustee without obtaining the consent of
the relevant Valuer, solicitor or licensed conveyancer or (in Scotland)
qualified conveyancer.
5. BUILDINGS INSURANCE
5.1 Each Property is insured under:
(a) a buildings insurance policy arranged by the Borrower in accordance
with the relevant Mortgage Conditions or in accordance with the
Alternative Insurance Recommendations; or
(b) the Halifax Policies; or
(c) a Seller-introduced building insurance policy; or
(d) a buildings insurance policy arranged by the relevant landlord; or
(e) the Properties in Possession Cover.
28
5.2 No act, event or circumstance has occurred which would adversely affect the
Properties in Possession Cover or entitle the insurers to refuse to make
payment thereunder or to reduce the amount payable in respect of any claim
thereunder.
5.3 All claims under the Properties in Possession Cover have been paid in full
within a reasonable time of the date of submission of the claim and, save
in respect of minor claims, there are no claims outstanding.
5.4 The Seller has and will maintain all consents, authorisations, approvals,
licenses and orders, including without limitation all authorisations under
the FMSA, to carry on any insurance related activities in respect of the
Properties.
6. MIG POLICIES
6.1 Where applicable, the MIG Policies are in full force and effect in relation
to the Initial Portfolio or, as the case may be, each New Portfolio and all
premiums thereon have been paid.
6.2 The benefit of the Halifax Mortgage Re Limited MIG Policies can be and will
have been, with effect from the Initial Closing Date or the relevant Sale
Date, as applicable, validly assigned to the Mortgages Trustee and charged
to the Security Trustee, insofar as they relate to the Initial Portfolio
or, as the case may be, each New Portfolio in each case in the manner and
to the extent contemplated by the Transaction Documents.
6.3 To the best of the knowledge of the Seller no act, event or circumstance
has occurred which would adversely affect the MIG Policies or entitle the
insurers to refuse to make payment thereunder or to reduce the amount
payable in respect of any claim thereunder insofar as they relate to the
Initial Portfolio or, as the case may be, each New Portfolio.
6.4 All valid claims under the MIG Policies have been paid in full within a
reasonable time of the date of submission of the claim.
7. THE SELLER'S TITLE
7.1 The Seller has good title to, and is the absolute unencumbered legal and
beneficial owner of, all property, interests, rights and benefits agreed to
be sold and/or assigned by the Seller to the Mortgages Trustee pursuant to
this Agreement free and clear of all mortgages, charges, liens,
Encumbrances, claims and equities (including, without limitation, rights of
set-off or counterclaim and unregistered or overriding interests which fall
within any of the paragraphs of schedules 1 or 3 to the Land Registration
Act 2002 (as such schedules have effect in accordance with section 90(5)
and Schedule 12 of the Land Registration Act 2002) or Section 28(1) of the
Land Registration (Scotland) Act 1979 and the Seller is not in breach of
any covenant implied by reason of its selling the Portfolio with full title
guarantee or absolute warrandice (or which would be implied if the
Registered Transfers, Unregistered Transfers or Scottish Transfers, as
applicable, were completed).
7.2 All steps necessary to perfect the Seller's title to the Loans and the
Related Security were duly taken at the appropriate time or are in the
process of being taken, in each case (where relevant) within any applicable
priority periods or time limits for registration with all due diligence and
without undue delay.
7.3 Save for Title Deeds held at the Land Registry or Registers of Scotland,
the Title Deeds and the Customer Files relating to each of the Loans and
their Related Security are held by, or are under the control of:
29
(a) the Seller; or
(b) the Seller's solicitors or licensed conveyancers or (in Scotland)
qualified conveyancers to the order of the Seller,
and the Title Deeds held at the Land Registry have been sent to it with a
request that any such Title Deeds will be returned to the Seller or its
solicitors on its behalf.
7.4 Neither the entry by the Seller into this Agreement nor any transfer,
assignment, assignation or creation of trust contemplated by this Agreement
affects or will adversely affect any of the Loans and their Related
Security (including, without limitation, the Insurance Policies) and the
Seller may freely assign and create a trust or trusts in respect of all its
rights, title, interests and benefits therein as contemplated in this
Agreement without breaching any term or condition applying to any of them.
7.5 The Seller has not knowingly waived or acquiesced in any breach of any of
its rights in respect of a Loan or its Related Security, other than waivers
and acquiescence such as a reasonable, prudent mortgage lender might make
on a case by case basis.
8. GENERAL
8.1 The Seller has, since the making of each Loan, kept or procured the keeping
of full and proper accounts, books and records showing clearly all
transactions, payments, receipts, proceedings and notices relating to such
Loan.
8.2 Neither the Seller nor as far as the Seller is aware any of its agents has
received written notice of any litigation, claim, dispute or complaint (in
each case, subsisting, threatened or pending) in respect of any Borrower,
Property, Loan, Related Security, Halifax Policy, MIG Policy or Properties
in Possession Cover which (if adversely determined) might have a material
adverse effect on the Trust Property or any part of it.
8.3 The Seller has received from each Borrower a variable direct debit
instruction in favour of the Seller signed by the relevant Borrower and
addressed to its bank, variable as to the amount payable by such Borrower
by unilateral notice given from time to time by the Seller to such
Borrower's bank without further instruction or consent from such Borrower
or such other method of payment as may be acceptable to a reasonable,
prudent mortgage lender.
8.4 There are no authorisations, approvals, licences, orders, notifications or
consents required as appropriate for the Seller to enter into or to perform
the obligations under this Agreement or to render this Agreement legal,
valid, binding, enforceable and admissible in evidence.
8.5 The Insurance Acknowledgements are valid, binding and enforceable against
the relevant insurer by the Mortgages Trustee and the Security Trustee.
30
SCHEDULE 2
REGISTERED TRANSFER
IN THE FORM OF THE LAND REGISTRY FORM TR4 AS SHOWN OVERLEAF WITH SUCH AMENDMENTS
AS THE MORTGAGES TRUSTEE MAY REASONABLY REQUIRE TO GIVE EFFECT TO THIS AGREEMENT
OR IN SUCH OTHER FORM AS THE MORTGAGES TRUSTEE MAY REASONABLY REQUIRE TO TAKE
ACCOUNT OF CHANGES IN LAW OR PRACTICE.
31
SCHEDULE 3
UNREGISTERED TRANSFER
THIS DEED OF TRANSFER OF MORTGAGES is made the________day of_________
BY:
(1) HALIFAX PLC whose registered office is at Xxxxxxx Xxxx, Xxxxxxx, Xxxx
Xxxxxxxxx XX0 0XX (hereinafter called the TRANSFEROR) of the one part; and
IN FAVOUR OF:
(2) PERMANENT MORTGAGES TRUSTEE LIMITED whose registered office is 00
Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX (hereinafter called the TRANSFEREE) of
the other part.
WHEREAS:
(A) By the charges by way of legal mortgage (the MORTGAGES) brief particulars
of which are set out in the Annexure hereto the properties brief
particulars of which are similarly set out became security for the
repayment of the monies therein mentioned.
(B) By a mortgage sale agreement (as amended and/or restated from time to time)
made between, inter alia, the Transferor and the Transferee on 14th June,
2002 (as the same may be or have been amended, varied or supplemented from
time to time with the consent of the parties hereto, the MORTGAGE SALE
AGREEMENT), the Transferor agreed to sell and the Transferee agreed to buy
all right, title, interest, benefit and obligation (both present and
future) of the Transferor in and under those Mortgages and all other
mortgages in favour of the Transferor over such properties which do not
relate to registered land for the consideration mentioned in the said
Mortgage Sale Agreement.
NOW THIS DEED WITNESSETH as follows:
1. In consideration for the sums payable and other consideration indicated
under the Mortgage Sale Agreement (receipt of which is hereby
acknowledged), the Transferor hereby transfers unto the Transferee with
full title guarantee all rights, title, interests, benefits and obligations
(both present and future) of the mortgagee in and under the Mortgages
including for the avoidance of doubt:
(a) the right to demand, xxx for, recover, receive and give receipts for
all principal moneys payable or to become payable under the relevant
Mortgages or the unpaid part thereof and the interest due or to become
due thereon;
(b) the benefit of all securities for such principal moneys and interest,
the benefit of all consents to mortgage signed by occupiers of the
mortgaged properties and the benefit of and the right to xxx on all
covenants with, or vested in, the mortgagee in relation to each
Mortgage and the rights to exercise all powers of the mortgagee in
relation to each Mortgage;
32
(c) all the estate and interest in the relevant mortgaged properties
vested in the mortgagee subject to redemption or cesser; and
(d) all causes of action of the mortgagee against any person in connection
with any report, valuation, opinion, certificate, consent to mortgage
or other statement of fact or opinion given in connection with any
Mortgage or affecting the decision to make the relevant advance.
2. This Deed shall be governed by and construed in accordance with English
law.
IN WITNESS WHEREOF this document has been executed and delivered as a deed the
day and year first before written.
EXECUTED as a DEED by )
HALIFAX PLC )
acting by its attorney in )
the presence of: ) ...............................
Witness's Signature: .......................
Name: .......................
Address: .......................
33
ANNEX 1
Account No. Property address Date of Mortgage Borrower
34
SCHEDULE 4
LENDING CRITERIA
LENDING CRITERIA
The Loans in the Initial Portfolio or, as the case may be, the relevant New
Portfolio were originated according to the Seller's lending policy at the
applicable time the Loan was offered. At the Sixth Issuer Closing Date the
Seller's lending policy included the criteria set out below. However, the Seller
retains the right to revise its lending policy from time to time, and so the
criteria applicable to New Loans may not be the same as those set out below.
1. Types of Property
Properties may be either freehold, leasehold or (in Scotland) heritable or
held under a long lease. In the case of leasehold properties, the unexpired
portion of the lease must in most cases not expire earlier than 30 years
after the term of the Loan. The property must be used solely for
residential purposes (with extremely limited case by case exceptions) and
must be in sound structural condition and repair or be capable of being put
into such state. House boats, mobile homes and any property on which
buildings insurance cannot be arranged are not acceptable. All persons who
are to be legal owners of the Property on completion of the relevant
Mortgage must be Borrowers.
Mortgage applications may be accepted by the Seller on properties in:
(a) England (including the Isle of Wight and Scilly Isles);
(b) Wales (including Anglesey);
(c) Northern Ireland; and
(d) Scotland.
All properties have been valued by a valuer approved by the Seller or,
where appropriate, according to a methodology which would meet the
standards of a reasonable, prudent mortgage lender and which has been
approved by the Seller.
2. Term of Loan
There is no minimum term on home purchase Loans and the maximum term is 40
years for all loans. A repayment period for a new Further Advance that
would extend beyond the term of the original advance may also be accepted
at the Seller's discretion, subject to the following:
(a) the consent of any subsequent lender or guarantor to the Further
Advance;
(b) the Seller may in its discretion extend the period of the original
advance, provided that, in all leasehold cases, not less than 30 years
of the lease must be left unexpired at the end of the term of the
Mortgage; and
35
(c) the approval of the valuer where the valuer has previously recommended
a term which is shorter than the maximum Loan terms referred to above.
If a Borrower requests to increase the term of the existing Loan, the
maximum term for a repayment Loan is 25 years from the date from which the
extended term is granted. However, the total term from the start date of
the account must not exceed 40 years.
If a Borrower or guarantor is already retired or a mortgage term is
requested that will take the Borrower/guarantor's term beyond the
anticipated retirement age, specific procedures must be followed by the
Seller.
3. Age of Applicant
All Borrowers must be aged 18 or over. There is no maximum age limit.
However, if the term of the Mortgage extends into retirement, the Seller
will attempt to ascertain the Borrower's anticipated income in retirement.
If the Seller determines the Borrower will not be able to afford the
Mortgage into retirement, the application will be declined. If the Borrower
is already retired, the Seller will consider the Borrower's ability to
support the Loan.
4. Loan to Value (or LTV) Ratio
The maximum original LTV ratio of Loans in the Initial Portfolio is 97 per
cent. At the date of this Agreement, for Properties of [GBP][150,000] or
less, the Seller may lend up to 97 per cent. of the improved valuation of
the Property (the original valuation plus the increase in value deriving
from any improvements). For Properties in excess of [GBP][150,000], the
permissible LTV ratio decreases as the Loan amount increases. The Seller
will not provide Loans in excess of 100 per cent. of the sum of the
purchase price and the increase in value deriving from any improvements.
In the case of a Property that is being purchased, value is determined by
the lower of the valuation and the purchase price. In the case of a
remortgage or Further Advance, value is determined on the basis of a
valuation only.
5. Mortgage Indemnity Guarantee Policies/High LTV Fees
Borrowers are currently required to pay high LTV fees to the Seller for
each Mortgage account where the aggregate of the outstanding principal
balance of the relevant Loan(s) at origination (excluding any capitalised
high LTV fees and/or booking fees and/or valuation fees) exceeds certain
specified percentages.
If the LTV ratio exceeds 90 per cent., the Borrower pays high LTV fees
based on the difference between the actual LTV ratio and a 75 per cent. LTV
ratio.
Prior to 1st January, 2001, the Seller required cover under mortgage
indemnity guarantee, or MIG, policies for Mortgages where the LTV ratio
exceeded 75 per cent., though during 1999 and 2000 the Seller paid the
premium for the MIG cover if the LTV ratio was between 75 per cent. and 90
per cent. Since 1st January, 2001, the Seller has not required cover under
MIG policies for any Loans.
36
6. Status of Applicant(s)
The maximum amount of the aggregate Loan(s) under a mortgage account is
determined by a number of factors, including the applicant's income. In
determining income, the Seller includes basic salary as primary income,
along with performance or profit-related pay, allowances, mortgage
subsidies, pensions, annuities and state benefits. Payments for overtime,
bonus and commissions will not be automatically included in income. The
Seller will include 60% of any regular overtime, bonuses or commission
(100% if guaranteed). The Seller will deduct the annual cost of existing
commitments (which have over one month to run) from the applicant's gross
income, depending on the applicant's credit score. The Seller will also
verify the applicant's employment.
In cases where a single Borrower is attempting to have the Seller take a
secondary income into account, the Seller will consider the sustainability
of the Borrower's work hours, the similarity of the jobs and/or skills, the
commuting time and distance between the jobs, the length of employment at
both positions and whether the salary is consistent with the type of
employment. The Seller will determine, after assessing the above factors,
if it is appropriate to use both incomes. If so, both incomes will be used
as part of the normal income calculation.
When there are two applicants, the Seller adds joint incomes together for
the purpose of deciding which income band to use. The Seller may, at its
discretion, consider the income of additional applicants as well but only a
maximum rate of one times that income.
The Seller may exercise discretion within its lending criteria in applying
those factors which are used to determine the maximum amount of the
Loan(s). Accordingly, these parameters may vary for some Loans. The Seller
may take the following into account when exercising discretion: credit
score result, existing customer relationship, percentage of LTV, stability
of employment and career progression, availability of living allowances
and/or mortgage subsidy from the employer, employer's standing, regularity
of overtime, bonus or commission (up to a maximum of 60 per cent. of the
income), credit commitments, quality of security (such as type of property,
repairs, location or saleability), and the increase in income needed to
support the Loan.
The Seller may not exercise discretion where it is lending over 95 per
cent. of value or the Borrower's credit score fails. There is an exception
from this policy for existing Borrowers who are moving home and the
Seller's overall position is improved.
7. Credit History
(a) Credit Search
With the exception, in some circumstances, of Further Advances to existing
Borrowers, a credit search is carried out in respect of all applicants.
Applications may be declined where an adverse credit history (for example,
county court judgement (or the Scottish equivalent), default, or bankruptcy
notice) is revealed.
37
(b) Existing Lender's Reference
In some cases, the Seller may also seek a reference from any existing
and/or previous lender. Any reference must satisfy the Seller that the
account has been properly conducted and that no history of material arrears
exists.
(c) First Time Buyers/Applicants in rented accommodation
Where applicants currently reside in rented accommodation, the Seller may
seek a landlord's reference. In addition, if considered appropriate, a
further reference may be taken in connection with any other property rented
by the applicant(s) within the preceding 18 months.
Tenancy statements may only be accepted from local authorities, housing
associations as reputable landlords known to the relevant branch/business
centre.
(d) Bank Reference
A bank reference may be sought or the applicants may be required to provide
bank statements in support of his or her application.
8. Scorecard
The Seller uses some of the above criteria and various other criteria to
provide an overall score for the application that reflects a statistical
analysis of the risk of advancing the Loan. The lending policies and
processes are determined centrally to ensure consistency in the management
and monitoring of credit risk exposure. Full use is made of software
technology in credit scoring new applications. Credit scoring applies
statistical analysis to publicly available data and customer-provided data
to assess the likelihood of an account going into arrears. Mortgage
collection is conducted through a number of payment collection departments.
The Seller reserves the right to decline an application that has received a
passing score. The Seller does have an appeals process if an applicant
believes his or her application to be unfairly denied. It is the Seller's
policy to allow only authorised individuals to exercise discretion in
granting variances from the scorecard.
38
SCHEDULE 5
POWER OF ATTORNEY IN FAVOUR OF FUNDING 1, THE MORTGAGES TRUSTEE
AND THE SECURITY TRUSTEE
THIS DEED OF POWER OF ATTORNEY is made on the [{circle}], 2004 by:
(1) HALIFAX PLC whose registered office is at Xxxxxxx Xxxx, Xxxxxxx, Xxxx
Xxxxxxxxx XX0 0XX (registered number 02367076) (the SELLER);
IN FAVOUR OF each of:
(2) PERMANENT FUNDING (NO. 1) LIMITED whose registered office is at Xxxxxxxxx
Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (registered number 4267660) (FUNDING
1);
(3) PERMANENT MORTGAGES TRUSTEE LIMITED whose registered office is at 00
Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX (registered number 83116) (the
MORTGAGES TRUSTEE);
(4) THE BANK OF NEW YORK, a New York banking corporation, acting through its
offices at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX in its capacity as
security trustee (the SECURITY TRUSTEE, which expression shall include such
company and all other persons or companies for the time being acting as the
security trustee or security trustees under the Funding 1 Deed of Charge).
WHEREAS:
(A) By virtue of a mortgage sale agreement (the MORTGAGE SALE AGREEMENT) dated
14th June, 2002 and as subsequently amended and restated on 6th March,
2003, 25th November, 2003, 12th March, 2004, 22nd July, 2004 and on
[{circle}], 2004 and made between the Seller (1) Funding 1 (2) the
Mortgages Trustee (3) and the Security Trustee provision was made for the
execution by the Seller of this Power of Attorney.
(B) Words and phrases in this Power of Attorney shall (save where expressed to
the contrary) have the same meanings respectively as the words and phrases
in the Master Definitions and Construction Schedule dated [{circle}], 2004
as amended, varied or supplemented from time to time and signed by amongst
others, the parties to the Power of Attorney.
NOW THIS DEED WITNESSETH as follows:
1. The Seller irrevocably and by way of security for the performance of the
covenants, conditions and undertakings on the part of the Seller contained
in the Mortgage Sale Agreement and the Servicing Agreement HEREBY APPOINTS
each of Funding 1, the Mortgages Trustee and the Security Trustee and any
receiver and/or administrator appointed from time to time in respect of
Funding 1 and/or the Mortgages Trustee or their assets (each an ATTORNEY)
severally to be its true and lawful attorney for the Seller and in the
Seller's name or otherwise to do any act matter or thing which any Attorney
considers necessary or desirable for the protection, preservation or
enjoyment of that Attorney's interest in the Loans and their Related
Security and/or which ought to be done under the covenants, undertakings
and provisions contained in the Mortgage Sale Agreement including (without
limitation) any or all of the following:
39
(a) to execute, sign, seal and deliver (using the company seal of the Seller
where appropriate) any conveyance, assignation or transfer (including, for
the avoidance of doubt each Scottish Declaration of Trust) of the Loans or
any of them to the Mortgages Trustee and its successors in title or to any
other person or persons entitled to the benefit thereof;
(b) to execute, sign, seal and deliver (using the company seal of the Seller
where appropriate) any conveyance, assignment, assignation or transfer
(including for the avoidance of doubt, each Scottish Declaration of Trust)
of the Related Security or any item comprised therein (to the extent only
that such item or items relate to the Loans) to the Mortgages Trustee and
its successors in title or to any other person or persons entitled to the
benefit thereof or entitled to be registered at the Land Registry as
proprietor thereof or to be registered in the Land Register of Scotland or
recorded in the General Register of Sasines as heritable creditor thereof
(as the case may be);
(c) to do every other act or thing which the Seller is obliged to do under the
Mortgage Sale Agreement or which that Attorney may otherwise consider to be
necessary proper or expedient for fully and effectually vesting or
transferring the interests sold thereunder in the Loans and their Related
Security or any or each of them and/or the Seller's estate right and title
therein or thereto in or to the Mortgages Trustee and its successors in
title or to any other person or persons entitled to the benefit thereof (as
the case may be) in the same manner and as fully and effectually in all
respects as the Seller could have done including, without limitation, any
of the acts referred to in CLAUSE 6.5(A) to (C) of the Mortgage Sale
Agreement;
(d) to exercise its rights, powers and
discretions under the Loans including the right to fix the rate or rates of
interest payable under the Loans in accordance with the terms thereof
including, for the avoidance of doubt, whilst such Loans subsist and
subject to the consent of the Mortgages Trustee being given to the setting
of such rates, setting the Seller's Variable Base Rate in the circumstances
referred to in CLAUSE 4 of the Servicing Agreement and/or following
perfection pursuant to CLAUSE 6.1 of the Mortgages Sale Agreement PROVIDED
THAT nothing in the Clause shall prevent the Seller (or any of its
attorneys from time to time) from setting a higher rate than those set or
to be set or required or to be required by the Mortgages Trustee or Funding
1 under this Power of Attorney;
(e) to discharge the Mortgages or any of them and to sign, seal, deliver and
execute such receipts releases surrenders instruments, discharges,
retrocessions and deeds as may be requisite or advisable in order to
discharge the relevant Property or Properties from the Mortgages or any of
them; and
(f) to exercise all the powers of the Seller in relation to such Loans and
their Related Security.
2. Each Attorney shall have the power by writing under its hand by an officer
of the Attorney from time to time to appoint a substitute who shall have
power to act on behalf of the Seller as if that substitute shall have been
originally appointed Attorney by this Power of Attorney (including, without
limitation, the power of further substitution) and/or to revoke any such
appointment at any time without assigning any reason therefor.
40
3. The Seller hereby agrees at all times hereafter to ratify and confirm
whatsoever the said Attorney or its attorneys shall lawfully do or cause to
be done in and concerning the Loans or their Related Security by virtue of
this Power of Attorney.
4. The laws of England shall apply to this Power of Attorney and the
interpretation thereof.
IN WITNESS WHEREOF the Seller has executed and delivered this document as a deed
the day and year first before written.
THE COMMON SEAL of )
HALIFAX PLC )
was hereunto affixed in )
the presence of: )
........................... Authorised Signatory
........................... Authorised Signatory
41
SCHEDULE 6
LOAN REPURCHASE NOTICE
Dated [ ]
1. It is hereby agreed that for the purpose of this notice the PRINCIPAL
AGREEMENT shall mean the Mortgage Sale Agreement dated 14th June, 2002 as
amended and restated on 6th March, 2003, 25th November, 2003, 12th March,
2004, 22nd July, 2004 and as further amended and restated on [{circle}],
2004 and from time to time, made between (1) HALIFAX PLC (the SELLER) (2)
PERMANENT FUNDING (NO. 1) LIMITED (3) PERMANENT MORTGAGES TRUSTEE LIMITED
(the MORTGAGES TRUSTEE) and (4) THE BANK OF NEW YORK (as the same may be or
have been amended, varied or supplemented from time to time with the
consent of those parties).
2. Save where the context otherwise requires, words and expressions in this
notice shall have the same meanings respectively as when used in the
Principal Agreement.
3. In accordance with CLAUSE 8.5 of the Principal Agreement, upon receipt of
this Loan Repurchase Notice by the Seller there shall exist between the
Seller and the Mortgages Trustee an agreement (the AGREEMENT FOR SALE) for
the sale by the Mortgages Trustee to the Seller of the Loans and their
Related Security more particularly described in the Schedule hereto.
Completion of such sale shall take place on [ ].
4. The Agreement for Sale shall incorporate, mutatis mutandis, the relevant
provisions of the Principal Agreement.
..............................
Signed for and on behalf of
PERMANENT MORTGAGES TRUSTEE LIMITED
[On duplicate
We hereby acknowledge receipt of and confirm the contents of the Loan Repurchase
Notice dated [ ].
...............................
Signed for and on behalf of
HALIFAX PLC]
SCHEDULE
5. 6. 7. 8. 9.
Title No. Borrower Account No. Property Postcode Date of Mortgage
(if registered)
42
SCHEDULE 7
ASSIGNMENT OF THIRD PARTY RIGHTS
THIS DEED OF ASSIGNMENT is made on [{circle}]
BY:
(1) HALIFAX PLC (registered number 02367076), a public limited company
incorporated under the laws of England and Wales, whose registered office
is at Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (the TRANSFEROR);
IN FAVOUR OF:
(2) PERMANENT MORTGAGES TRUSTEE LIMITED (registered number 83116), a private
limited company incorporated under the laws of Jersey, Channel Islands,
whose registered office is at 00 Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX (the
TRANSFEREE).
WHEREAS:
(A) By the charges by way of legal mortgage or standard security (the
MORTGAGES) brief particulars of which are set out in the Annexure hereto
the properties brief particulars of which are similarly set out became
security for the repayment of the moneys therein mentioned.
(B) By the Mortgage Sale Agreement, the Transferor agreed to sell and the
Transferee agreed to buy all right, title, interest and benefit (both
present and future) of the Transferor in and under those Mortgages and all
Related Security and all monies secured by those Mortgages and Related
Security.
NOW THIS DEED WITNESSETH as follows:
1. Terms used (but not defined) in this Deed (including the recitals) shall,
except where the context otherwise requires and save where otherwise
defined in this Deed, have the meanings given to them in the master
definitions and construction schedule dated [{circle}], 2004 as amended
and/or restated from time to time, signed by, amongst others, the parties
to this Deed (as the same may be amended, varied or supplemented from time
to time with the consent of the parties to this Deed) (the MASTER
DEFINITIONS AND CONSTRUCTION SCHEDULE) and this Deed shall be construed in
accordance with the interpretation provisions set out in CLAUSE 2 thereof.
2. The Transferor hereby assigns absolutely unto the Transferee with full
title guarantee or, in the case of any Related Security or causes of action
(as described in CLAUSE 2(B) below) governed by Scots law, with absolute
warrandice:
(a) the benefit of all Related Security relating to the Mortgages
(including without limitation all securities for the principal moneys
and interest secured by the Mortgages and the benefit of all consents
to mortgage signed by occupiers of the mortgaged properties and the
benefit of all guarantees, indemnities and surety contracts relating
to the Mortgages) other than any such Related Security which has
43
been transferred to the Transferee by other means or which is not
otherwise capable of such transfer; and
(b) all causes of action of the Transferor against any person in
connection with any report, valuation, opinion, certificate, consent
or other statement of fact or opinion given in connection with any
Related Security relating to the Mortgages or affecting the decision
to make any advance in connection with such Mortgages.
3. The Transferor on behalf of the Transferee agrees to intimate the
assignation contained in Clause 2 hereof to all relevant third parties
where required to do so pursuant to CLAUSE 6 of the Mortgage Sale Agreement
or as otherwise required by the Security Trustee.
4. This Deed shall be governed by and construed in accordance with English
law.
IN WITNESS WHEREOF this document has been executed and delivered as a deed the
day and year first before written.
EXECUTED AS A DEED by )
HALIFAX PLC )
acting by its attorney in )
the presence of: ) .....................................
Witness's Signature: .....................................
Name: .....................................
Address: .....................................
44
ANNEXURE REFERRED TO IN THE FOREGOING ASSIGNMENT
Account No. Property address Borrower Date of Mortgage
45
SCHEDULE 8
ASSIGNMENT OF HALIFAX MORTGAGE RE LIMITED MIG POLICIES
THIS DEED is made on [{circle}]
BY:
(1) HALIFAX PLC (registered number 02367076), a public limited company
incorporated under the laws of England and Wales, whose registered office
is at Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (the SELLER);
IN FAVOUR OF:
(2) PERMANENT MORTGAGES TRUSTEE LIMITED (registered number 83116), a private
limited company incorporated under the laws of Jersey, Channel Islands,
whose registered office is at 00 Xxxxxxxxx, Xx Xxxxxx, Xxxxxx, XX0 0XX (the
MORTGAGES TRUSTEE).
WHEREAS:
(A) By a Mortgage Sale Agreement dated 14th June, 2002, as amended and restated
on 6th March, 2003, 25th November, 2003, 12th March, 2004, 22nd July, 2004
as further amended and restated on [{circle}], 2004 and from time to time
made between, amongst others, the parties hereto, the Seller agreed to
transfer to the Mortgages Trustee certain charges by way of legal mortgage
or standard security secured on residential property in England, Wales and
Scotland together with the benefit of any monies secured thereby from time
to time.
(B) The Seller has the benefit of mortgage indemnity insurance policies brief
details of which are set out in the Schedule to this Deed (the HMRL MIG
POLICIES).
(C) The Seller has agreed with the Mortgages Trustee to assign to the Mortgages
Trustee the benefit of the HMRL MIG Policies to the extent that they relate
to the Loans in the Portfolio.
(D) The insurance businesses (including, for the avoidance of doubt, the HMRL
MIG Policies) of Halifax Mortgage Re Limited were acquired by HBOS
Insurance (PCC) Guernsey Limited on 21st December, 2001.
NOW THIS DEED WITNESSETH as follows:
1. Terms used (but not defined) in this Deed (including the recitals) shall,
except where the context otherwise requires and save where otherwise
defined in this Deed, have the meanings given to them in the master
definitions and construction schedule dated [{circle}], 2004 as amended
and/or restated from time to time, signed by amongst others, the parties to
this Deed, (as the same may be amended, varied or supplemented from time to
time with the consent of the parties to this Deed) (the MASTER DEFINITIONS
CONSTRUCTION SCHEDULE) and this Deed shall be construed in accordance with
the interpretation provisions set out in CLAUSE 2 thereof.
46
2. The Seller with full title guarantee hereby conveys, transfers and assigns
to the Mortgages Trustee absolutely all its right, title, interest and
benefit in the HMRL MIG Policies to the extent that they relate to the
Mortgages which as at this date are comprised in the Portfolio, and all
moneys and proceeds to become payable under any of the same and all
covenants relating thereto and all powers and remedies for enforcing the
same.
3. This Deed shall be governed by and construed in accordance with English
law.
IN WITNESS WHEREOF which this document has been executed and delivered as a deed
the day and year first before written.
EXECUTED AS A DEED by )
HALIFAX PLC )
acting by its attorney in )
the presence of: ) .....................................
Witness's Signature: .....................................
Name: .....................................
Address: .....................................
SCHEDULE
47
SCHEDULE 9
HALIFAX MORTGAGE RE LIMITED MIG POLICIES ASSIGNMENT NOTICE
To: HBOS Insurance (PCC) Guernsey Ltd
c/o AON Insurance Managers (Guernsey) Limited
(as Managers of HBOS Insurance (PCC) Ltd)
XX Xxx 00
Maison Trinity
Xxxxxxx Xxxxxx
Xx Xxxxx Xxxx
Xxxxxxxx XX0 0XX
[{circle}]
Dear Sirs,
RE: ASSIGNMENT OF MORTGAGE INDEMNITY INSURANCE POLICIES NUMBERED [{circle}]
RESPECTIVELY (THE MIG POLICIES)
We hereby give you notice that, by an Assignment dated [{circle}] and made
between ourselves and Permanent Mortgages Trustee Limited (the MORTGAGES
TRUSTEE) (a copy of which is attached to this notice), we assigned all of our
right, title, benefit and interest in the MIG Policies to the Mortgages Trustee
(to the extent that they relate to the loans and the mortgages in a portfolio
referred to in [the Mortgage Sale Agreement dated [{circle}], 2004 as amended
and/or restated from time to time between ourselves, Permanent Funding (No. 1)
Limited, the Mortgages Trustee and The Bank of New York/the New Portfolio Notice
dated [{circle}] between ourselves, Permanent Funding (No.1) Limited and the
Mortgages Trustee)]/1/.
Yours faithfully,
....................................................
For and on behalf of
HALIFAX PLC
Copy: Permanent Mortgages Trustee Limited
Permanent Funding (No. 1) Limited
The Bank of New York
------------
/1/ Delete as applicable.
48
SCHEDULE 10
INSURANCE ENDORSEMENT
ON THE HEADED NOTEPAPER OF [THE RELEVANT INSURER]
ENDORSEMENT [X] attaching to, supplemental to and forming part of policy number
[policy number] (the POLICY) issued by [name of Insurer] (the INSURER).
Expressions defined in the Policy shall unless indicated otherwise, have the
same meanings in this endorsement.
It is hereby noted and agreed that with effect from the date of this
Endorsement:
1. The definition of INSURED shall be deleted in its entirety and replaced
with the following wording:
(a) "Halifax plc (HALIFAX) whose registered office is at Xxxxxxx Xxxx,
Xxxxxxx, Xxxx Xxxxxxxxx, XX0 0XX;
(b) any assignee or person to whom Halifax has assigned (whether legally
or equitably and whether by way of security or otherwise) or has
declared a trust in respect of any loans and/or mortgages and/or
standard securities and related collateral and/or assets to which this
Policy relates (an ASSIGNEE) (whether or not any such Assignee holds
the same on trust for another or others); and
(c) any person benefiting from security granted by Halifax or its Assignee
over any loans and/or mortgages and/or standard securities and related
collateral and/or assets to which this Policy relates in connection
with the financing or re-financing of such loans and/or mortgages
and/or standard securities and related collateral and/or assets."
2. Each term of the Policy which is inconsistent with the intent and/or effect
of the amended definition of INSURED contemplated in paragraph 1 above (the
NEW DEFINITION) shall be subject to the New Definition and shall not apply
to the extent that such term of the Policy is inconsistent with the New
Definition.
3. This endorsement does not have, nor is intended by the parties to have, the
effect of conferring on the Insurer any greater liabilities under the
Policy than those of the Insurer immediately prior to this endorsement
being entered into between parties to this endorsement.
4. The Insurer acknowledges and agrees that any Insured under the Policy may
from time to time appoint Halifax or any other person as agent of that
Insured to deal with the Insurer on its behalf in the administration of and
making and payment of claims under the Policy.
All other terms, clause and conditions of the Policy remain unchanged.
This Endorsement is signed for and on behalf of the Insurer by a duly authorised
signatory:
..................................
49
[Name]
[Position]
[Insurer]
Dated ______________________, 2004
50
SCHEDULE 11
INSURANCE ACKNOWLEDGEMENTS
PART 1
ON THE HEADED NOTEPAPER OF GE MORTGAGE INSURANCE LIMITED
To: Halifax plc (the SELLER)
Xxxxxxx Xxxx
Xxxxxxx
Xxxx Xxxxxxxxx
XX0 0XX
Permanent Mortgages Trustee Limited (the MORTGAGES TRUSTEE)
00 Xxxxxxxxx
Xx Xxxxxx
Xxxxxx
XX0 00X
Channel Islands
Permanent Funding (No. 1) Limited (FUNDING 1)
Xxxxxxxxx Xxxxx
Xxxxxxxxx Xxxx
Xxxxxx
XX0X 0XX
The Bank of New York (the SECURITY TRUSTEE)
Xxx Xxxxxx Xxxxxx
Xxxxxx X00 0XX
[date]
Dear Sirs,
MORTGAGE INDEMNITY GUARANTY POLICIES NUMBERS [{circle}] AND [{circle}] (THE MIG
POLICIES)
We refer to the transaction entered into or to be entered into between, inter
alios, each of the parties to whom this letter is addressed, pursuant to which:
(a) the Seller may assign or agree to transfer or declare a trust in respect of
its interest in properties which are (or may from time to time be) covered
by the MIG Policies to the Mortgages Trustee;
(b) the Mortgages Trustee may declare a trust over its interest in such
properties in favour of Funding 1 and the Seller; and
(c) Funding 1 may charge its interest in such properties to the Security
Trustee.
51
In consideration of the payment of [GBP]1 made by each of the Seller, the
Mortgages Trustee, Funding 1 and the Security Trustee (receipt whereof is hereby
acknowledged), we hereby confirm that the arrangements set out in PARAGRAPHS (A)
to (C) inclusive above will not cause the MIG Policies to lapse or terminate
and, notwithstanding any such arrangements, we will continue to pay claims under
the MIG Policies in the same way and in the same amount as we would have paid
them, had the said arrangements not been entered into.
Yours faithfully,
FOR AND ON BEHALF OF GE MORTGAGE INSURANCE LIMITED
52
PART 2
ON THE HEADED NOTEPAPER OF HBOS INSURANCE (PCC) GUERNSEY LTD
Halifax plc (the SELLER)
To: Xxxxxxx Xxxx
Xxxxxxx
Xxxx Xxxxxxxxx
XX0 0XX
Permanent Mortgages Trustee Limited (the MORTGAGES TRUSTEE)
00 Xxxxxxxxx
Xx Xxxxxx
Xxxxxx
XX0 00X
Channel Islands
Permanent Funding (No. 1) Limited (FUNDING 1)
Xxxxxxxxx Xxxxx
Xxxxxxxxx Xxxx
Xxxxxx
XX0X 0XX
Bank of New York (the SECURITY TRUSTEE)
00xx Xxxxx
Xxx Xxxxxx Xxxxxx
Xxxxxx
X00 0XX
[{circle}], 2004
Dear Sirs,
MORTGAGE INDEMNITY GUARANTEE POLICY NUMBERS 227001, 227001(A), 227002, 227003
AND 227006 (THE "MIG POLICIES")
We refer to the transaction entered into or to be entered into between, inter
alios, each of the parties to whom this letter is addressed, pursuant to which:
(a) all of the Seller's right, title, benefit and interest in the MIG Policies
(to the extent that the same relate to the mortgage loans and their
collateral security sold or to be sold by the Seller to the Mortgages
Trustee pursuant to a mortgage sale agreement to be entered into between
each of the parties to whom this letter is addressed) shall be assigned by
the Seller to the Mortgages Trustee;
(b) the Seller may sell and assign or agree to sell and assign or declare a
trust in respect of its interest in properties which are (or may from time
to time be) covered by the MIG Policies to or in favour of the Mortgages
Trustee;
53
(c) the Mortgages Trustee may declare a trust over its interest in such
properties in favour of Funding 1 and the Seller; and
(d) Funding 1 may charge its beneficial interest in such properties to the
Security Trustee.
In consideration of the payment of [GBP]1 made by each of the Seller, the
Mortgages Trustee, Funding 1 and the Security Trustee (receipt whereof is hereby
acknowledged), we hereby confirm that the arrangements set out in PARAGRAPHS (A)
to (D) inclusive above will not cause the MIG Policies to lapse or terminate
and, notwithstanding any such arrangements, we will continue to pay claims under
the MIG Policies in the same way and in the same amount as we would have paid
them, had the said arrangements not been entered into.
Yours faithfully,
FOR AND ON BEHALF OF HBOS INSURANCE (PCC) GUERNSEY LIMITED
54
SCHEDULE 12
NEW PORTFOLIO NOTICE
Dated [ ]
1. It is hereby agreed for the purpose of this notice the PRINCIPAL AGREEMENT
shall mean the Mortgage Sale Agreement dated 14th June, 2002 as amended and
restated on 6th March, 2003, 25th November, 2003, 12th March, 2004, 22nd
July, 2004 and as further amended and restated on [{circle}], 2004 made
between (1) HALIFAX PLC (the SELLER) (2) PERMANENT FUNDING (NO. 1) LIMITED
(FUNDING 1) (3) PERMANENT MORTGAGES TRUSTEE LIMITED (the MORTGAGES TRUSTEE)
and (4) THE BANK OF NEW YORK (as the same may be or have been amended,
varied or supplemented from time to time with the consent of those
parties).
2. Save where the context otherwise requires, words and expressions in this
notice shall have the same meanings respectively as when used in the
Principal Agreement.
3. In accordance with and subject to CLAUSE 4.1 of the Principal Agreement,
upon receipt by the Seller of the duplicate of this notice signed by
Funding 1 and the Mortgages Trustee, there shall exist between the Seller,
Funding 1 and the Mortgages Trustee an agreement (the AGREEMENT FOR SALE)
for the sale by the Seller to the Mortgages Trustee of the New Loans and
their Related Security more particularly described in the Schedule hereto
(other than any New Loans and their Related Security which have been
redeemed in full prior to the next following Sale Date). Completion of such
sale shall take place on [ ].
4. The Agreement for Sale shall incorporate, mutatis mutandis, the relevant
provisions of the Principal Agreement.
.........................................
Signed for and on behalf of
HALIFAX PLC
[On duplicate:
We hereby acknowledge receipt of the New Portfolio Notice dated [ ], and
confirm that we are prepared to purchase New Loans as set out in that notice.
.........................................
Signed for and on behalf of
PERMANENT FUNDING (NO. 1) LIMITED
.........................................
Signed for and on behalf of
[PERMANENT MORTGAGES TRUSTEE LIMITED]
SCHEDULE
1. 2. 3. 4. 5.
55
Title No. Borrower Property Postcode Account No. Date of Mortgage
(if registered)
56
SCHEDULE 13
FORMS OF SCOTTISH TRANSFER
LAND REGISTER
We, HALIFAX PLC, incorporated under the Companies Acts (registered number
02367076) and having our Registered Office at Xxxxxxx Xxxx, Xxxxxxx, Xxxx
Xxxxxxxxx XX0 0XX (the TRANSFEROR) CONSIDERING THAT in terms of a Mortgage Sale
Agreement among us the Transferor, PERMANENT MORTGAGES TRUSTEE LIMITED, a
private limited company incorporated under the laws of Jersey, Channel Islands
(registered number 83116) and having its registered office at 00 Xxxxxxxxx, Xx
Xxxxxx, Xxxxxx XX0 0XX (the TRANSFEREE) and others dated 14 June 2002 as amended
and restated on 6 March 2003, 25 November 2003, 12 March, 2004 and 22 July 2004
and as further amended and restated on [{circle}], 2004 (the MORTGAGE SALE
AGREEMENT) we have sold our whole right, title and interest in and to the
Standard Securities and others hereinafter mentioned to the Transferee NOW
THEREFORE we, the Transferor, IN CONSIDERATION of the sums payable in terms of
and in implement of the Mortgage Sale Agreement HEREBY ASSIGN to the Transferee
as trustee under and in terms of the Mortgages Trust Deed among us, the
Transferor, the Transferee and others dated 13 June 2003 as amended and restated
on 6 March 2003, 25 November 2003, 12 March, 2004 and 22 July 2004 and as
further amended and restated on [{circle}], 2004 (the MORTGAGES TRUST DEED) and
its successor or successors as trustee or trustees under and in terms of the
Mortgages Trust Deed:
(a) the Standard Securities granted by the respective parties whose names are
specified in Column 3 of the Schedule annexed and executed as relative
hereto in favour of us the Transferor for all sums due and to become due,
to the extent of the sums specified in the relative entry in Column 6 of
the said Schedule being the amounts now due under the said respective
Standard Securities, registered said Standard Securities in the Land
Register under the Title Number specified in the relative entry in Column 4
of the said Schedule on the date specified in the relative entry in Column
5 of the said Schedule; and
(b) the whole rights, title and interest of us the Transferor in and under all
and any personal bonds, credit agreements or agreements for loan (however
constituted) secured by the said Standard Securities and granted by or
entered into with the said respective parties whose names are specified in
Column 3 of the said Schedule, the dates of the respective personal bonds,
credit agreements or agreements for loan being specified in the relative
entry in Column 7 of the said Schedule;
With interest from and also arrears and accumulations of interest due and unpaid
as at [ ]; And we grant warrandice: IN WITNESS WHEREOF these presents
typewritten on this [and the preceding] page are together with the Schedule
annexed hereto executed at [ ] on the [ ] day of [ ] as follows:
SUBSCRIBED for and on behalf of HALIFAX PLC by
............................... ......................Authorised Signatory
(Print Full Name)
before this witness
57
............................... Witness
...............................
(Print Full Name)
...............................
...............................
(Address)
58
THIS IS THE SCHEDULE REFERRED TO IN THE FOREGOING ASSIGNATION BY HALIFAX PLC IN
FAVOUR OF PERMANENT MORTGAGES TRUSTEE LIMITED
1 2 3 4 5 6 7
Account Address Borrowers Title Registration Sum Due Date of
No. Full Names Number Date Bond or
Loan Agreement
............................... ......................Authorised Signatory
59
SCHEDULE 14
FORMS OF SCOTTISH TRANSFER
SASINE REGISTER
We, HALIFAX PLC, incorporated under the Companies Acts (registered number
02367076) and having our Registered Office at Xxxxxxx Xxxx, Xxxxxxx, Xxxx
Xxxxxxxxx XX0 0XX (the TRANSFEROR) CONSIDERING THAT in terms of a Mortgage Sale
Agreement among us the Transferor, PERMANENT MORTGAGES TRUSTEE LIMITED, a
private limited company incorporated under the laws of Jersey, Channel Islands
(registered number 83116) and having its registered office at 00 Xxxxxxxxx, Xx
Xxxxxx, Xxxxxx XX0 0XX (the TRANSFEREE) and others dated 14 June 2002 as amended
and restated on 6 March 2003, 25 November 2003, 12 March 2004 and 22 July 2004
and as further amended and restated on [{circle}], 2004 (the MORTGAGE SALE
AGREEMENT) we have sold our whole right, title and interest in and to the
Standard Securities and others hereinafter mentioned to the Transferee NOW
THEREFORE we the Transferor IN CONSIDERATION of the sums payable in terms of and
in implement of the Mortgage Sale Agreement HEREBY ASSIGN to the Transferee as
trustee under and in terms of the Mortgages Trust Deed among us, the Transferor,
the Transferee and others dated 13 June 2002 as amended and restated on 6 March
2003, 25 November 2003, 12 March 2004 and 22 July 2004 and as further amended
and restated on [{circle}], 2004 (the MORTGAGES TRUST DEED) and its successor or
successors as trustee or trustees under and in terms of the Mortgages Trust
Deed:
(a) the Standard Securities granted by the respective parties whose names are
specified in Column 3 of the Schedule annexed and executed as relative
hereto in favour of us the Transferor for all sums due and to become due,
to the extent of the sums specified in the relative entry in Column 6 of
the said Schedule being the amounts now due under the said respective
Standard Securities, recorded said Standard Securities in the Register for
the County specified in the relative entry in Column 4 of the said Schedule
on the date specified in the relative entry in Column 5 of the said
Schedule; and
(b) the whole rights, title and interest of us the Transferor in and under all
and any personal bonds, credit agreements or agreements for loan (however
constituted) secured by the said Standard Securities and granted by or
entered into with the said respective parties whose names are specified in
Column 3 of the said Schedule, the dates of the respective personal bonds,
credit agreements or agreements for loan being specified in the relative
entry in Column 7 of the said Schedule;
60
With interest from and also arrears and accumulations of interest due and unpaid
as at [ ]; And we grant warrandice: IN WITNESS WHEREOF these presents
typewritten on this [and the preceding] page are together with the Schedule
annexed hereto executed at [ ] on the [ ] day of [ ] as follows:
SUBSCRIBED for and on behalf of HALIFAX PLC by
............................... ......................Authorised Signatory
(Print Full Name)
before this witness
............................... Witness
...............................
(Print Full Name)
...............................
...............................
(Address)
REGISTER on behalf of the within named PERMANENT MORTGAGES TRUSTEE LIMITED as
trustee within mentioned in the REGISTERS of the COUNTIES of [ ]
61
THIS IS THE SCHEDULE REFERRED TO IN THE FOREGOING ASSIGNATION BY HALIFAX PLC IN
FAVOUR OF PERMANENT MORTGAGES TRUSTEE LIMITED
1 2 3 4 5 6 7
Account Address Borrowers Country Recording Sum Due Date of
No. Full Names Date Bond or
Loan Agreement
............................... ......................Authorised Signatory
62
SCHEDULE 15
FORM OF SCOTTISH DECLARATION OF TRUST
DECLARATION OF TRUST
among
HALIFAX PLC, incorporated under the Companies Acts (registered number 02367076)
and having its Registered Office at Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxxxxxxx XX0
0XX (the SELLER);
and
PERMANENT MORTGAGES TRUSTEE LIMITED, a private limited company incorporated
under the laws of Jersey, Channel Islands (registered number 83116), and having
its registered office at 00 Xxxxxxxxx, Xx Xxxxxx, Xxxxxx XX0 0XX, Channel
Islands as trustee under and in terms of the mortgages trust deed aftermentioned
(the MORTGAGES TRUSTEE);
and
PERMANENT FUNDING (NO. 1) LIMITED, incorporated under the Companies Acts
(registered number 4267660) and having its registered office at Xxxxxxxxx Xxxxx,
Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (FUNDING 1).
WHEREAS:
(A) Title to the Scottish Trust Property aftermentioned is held by and vested
in the Seller.
(B) In terms of a Mortgages Trust Deed entered into among the Seller, Funding 1
and the Mortgages Trustee dated 13th June 2002 as amended and restated on
6th March 2003, 25th November 2003, 12th March, 2004 and 22nd July, 2004
and as further amended and restated on [{circle}], 2004 and the Mortgages
Trust constituted in terms thereof, the Mortgages Trustee holds the Trust
Property on trust for the Beneficiaries therein specified.
(C) In terms of a Mortgage Sale Agreement entered into among, inter alia, the
Seller, Funding 1 and the Mortgages Trustee dated 14th June 2002, as
amended on 6th March 2003, 25th November 2003, 12th March, 2004 and 22nd
July, 2004 and as amended and restated on [{circle}], 2004 (the MORTGAGE
SALE AGREEMENT) the Seller has agreed to sell inter alia the said Scottish
Trust Property to the Mortgages Trustee to be held thereafter by the
Mortgages Trustee under and in terms of the Mortgages Trust; and
(D) In implement of CLAUSE 4.5(A)(VII) of the Mortgage Sale Agreement and
pending the taking of legal title to the said Scottish Trust Property by
the Mortgages Trustee, the Seller has undertaken to grant this deed.
NOW THEREFORE the parties HEREBY AGREE and DECLARE as follows:
1. INTERPRETATION
In this deed:
63
(a) the amended and restated master definitions and construction schedule
signed by, amongst others, the parties to this deed and dated [{circle}],
2004 (as the same may be amended, varied or supplemented from time to time
with the consent of the parties to this deed) (the MASTER DEFINITIONS AND
CONSTRUCTION SCHEDULE) is expressly and specifically incorporated into this
deed 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 deed, including
the Recitals and this deed shall be construed in accordance with the
interpretation provisions set out in CLAUSE 2 of the Master Definitions and
Construction Schedule; and
(b) SCOTTISH TRUST PROPERTY shall mean the Scottish Loans and their Related
Security brief particulars of which are detailed in the schedule annexed
and executed as relative hereto and any Further Advances made in respect of
such Scottish Loans (the SCHEDULE), and all right, title, interest and
benefit of the Seller to:
(i) all payments of principal and interest (including, for the avoidance
of doubt, all Accrued Interest, Arrears of Interest, Capitalised
Expenses and Capitalised Arrears) and other sums due or to become due
in respect of such Scottish Loans and their Related Security
including, without limitation, the right to demand, xxx for, recover
and give receipts for all principal monies, interest and costs and
the right to xxx on all covenants and undertakings made or expressed
to be made in favour of the Seller under the applicable Mortgage
Terms;
(ii) subject where applicable to the subsisting rights of redemption of
Borrowers, all MHA Documentation, Deeds of Postponement, all third
party guarantees and any other collateral security for the repayment
of the relevant Scottish Loans;
(iii) the right to exercise all the powers of the Seller in relation
thereto;
(iv) all proceeds resulting from the enforcement of any of those Scottish
Loans and their Related Security;
(v) each Certificate of Title and Valuation Report relevant to those
Scottish Loans and any right of action of the Seller against any
solicitor, qualified conveyancer, valuer or other person in
connection with any report, valuation, opinion, certificate or other
statement of fact or opinion given in connection with any of those
Scottish Loans and their Related Security, or any part thereof or
affecting the decision of the Seller to make or offer to make any of
those Scottish Loans or part thereof;
(vi) the proceeds of all claims made by or on behalf of the Seller or to
which the Seller is entitled in relation to the Scottish Properties
secured by the Scottish Mortgages detailed in the Schedule under the
Buildings Policies and the Properties in Possession Cover; and
(vii) the MIG Policies, so far as they relate to the relevant Scottish
Loans and their Related Security, including the right to receive the
proceeds of any claims.
64
2. DECLARATION OF TRUST
The Seller hereby DECLARES that from and after the date hereof the Seller
holds and, subject to CLAUSE 8 below, shall henceforth hold the Scottish
Trust Property and its whole right, title and interest, present and future,
therein and thereto in trust absolutely for the Mortgages Trustee and its
assignees (whether absolutely or in security) whomsoever.
3. INTIMATION
The Seller hereby intimates to the Mortgages Trustee the coming into effect
of the trust hereby declared and created and the Mortgages Trustee by its
execution of this deed immediately subsequent to the execution hereof by
the Seller acknowledges such intimation.
4. DEALINGS WITH SCOTTISH TRUST PROPERTY AND NEGATIVE PLEDGE
The Seller warrants and undertakes that:
(a) as at the date hereof it holds, subject to any pending registration or
recording in the Land Register of Scotland or the General Register of
Sasines, legal title to the Scottish Trust Property unencumbered by
any fixed or floating charge, diligence or other Security Interest;
(b) it shall not create or agree to create any fixed or floating charge or
other Security Interest over or which may attach to or affect the
whole or any part of the Scottish Trust Property or otherwise dispose
of the same at any time when such Scottish Trust Property or part
thereof remains subject to the trust hereby created; and
(c) it shall deal with the Scottish Trust Property (including without
prejudice to said generality the calculation and setting of any
interest rate applicable thereto) in accordance with the provisions of
the Transaction Documents and the specific written instructions (if
any) of the Mortgages Trustee or its foresaids and shall take, subject
to Clause 8 below, any such action as may be necessary (including for
the avoidance of doubt the raising or defending of any proceedings in
any court of law whether in Scotland or elsewhere) to secure or
protect the title to the Scottish Trust Property but only in
accordance with the specific written instructions (if any) of the
Mortgages Trustee or its foresaids.
5. TRANSFER OF TITLE
5.1 The Mortgages Trustee and its foresaids as beneficiary hereunder shall have
the right to call upon the Seller to execute and deliver to the Mortgages
Trustee, subject to the terms of CLAUSE 6 of the Mortgage Sale Agreement,
valid assignations of the Scottish Trust Property or any part thereof, and
that notwithstanding the winding up of the Seller, the making of any
administration order or the filing of documents with the court for the
appointment of an administrator or the service of a notice of intention to
appoint an administrator in respect of the Seller or the appointment of a
receiver to all or any part of the Scottish Trust Property.
5.2 The Seller undertakes to the Mortgages Trustee and binds and obliges itself
that, upon the occurrence of any one of the events specified in CLAUSE 6.1
of the Mortgage Sale Agreement, it will within five London Business Days of
such occurrence provide such information as is
65
necessary to enable the Mortgages Trustee to complete Scottish Transfers
(including all schedules and annexures thereto) in relation to the whole of
the Scottish Trust Property.
5.3 For further assuring the said rights and powers specified in this CLAUSE 5,
the Seller has granted a power of attorney in favour of the Mortgages
Trustee, Funding 1 and the Security Trustee substantially in the form set
out in SCHEDULE 5 to the Mortgage Sale Agreement.
6. MORTGAGES TRUSTEE DECLARATION OF TRUST
The Mortgages Trustee by its said execution of this deed hereby DECLARES
that its whole right, title and beneficial interest in and to the Scottish
Trust Property in terms of this deed are and shall be held (to the extent
not already so held) by the Mortgages Trustee and its foresaids under and
in terms of the Mortgages Trust and all sums and amounts received or held
by the Mortgages Trustee relating thereto or deriving therefrom have been
and shall be added (to the extent aforesaid) to the Trust Property and held
by the Mortgages Trustee under the Mortgages Trust Deed.
7. MORTGAGES TRUST INTIMATION
The Mortgages Trustee hereby intimates to Funding 1 and the Seller, as
Beneficiaries of the Mortgages Trust, the declaration of trust made in
terms of Clause 6 above and Funding 1 and the Seller by executing this deed
acknowledge such intimation.
8. TERMINATION OF TRUST
If:
(a) legal title to any part or parts of the Scottish Trust Property is
taken by the Mortgages Trustee or its foresaids in accordance with the
provisions of CLAUSE 5 above (which in the case of any Scottish
Mortgage shall be constituted by the registration or recording of the
title thereto in the Land Register of Scotland or the General Register
of Sasines (as appropriate); or
(b) any part or parts of the Scottish Trust Property forms the subject of
a repurchase in accordance with the terms of CLAUSE 8.5 of the
Mortgage Sale Agreement,
the trust hereby declared and created pursuant to CLAUSES 2 and 3 above
shall (but only when any of the events or transactions before stated has
been completed irrevocably, validly and in full) ipso facto fall and cease
to be of effect in respect of such part or parts of the Scottish Trust
Property but shall continue in full force and effect in respect of the
whole remainder (if any) of the Scottish Trust Property.
9. CHANGE OF TRUSTEE
Except with the prior consent of the Mortgages Trustee and (for so long as
each retains any right or interest in the Scottish Trust Property) Funding
1 and the Security Trustee, the Seller shall not be entitled to resign
office as a trustee or assume a new trustee or trustees under this deed.
66
10. VARIATION
This deed and the trusts hereby declared and created pursuant to CLAUSES 2
and 3 and CLAUSES 6 and 7 above shall not be varied in any respect without
the consent in writing of the Mortgages Trustee and (for so long as each
retains any right or interest in the Scottish Trust Property) Funding 1 and
the Security Trustee.
11. GOVERNING LAW
This deed shall be governed by and construed in accordance with the law of
Scotland and each of the parties hereby prorogates the non-exclusive
jurisdiction of the Scottish courts so far as not already subject thereto
and waives any right or plea of forum non conveniens in respect of such
jurisdiction.
12. REGISTRATION
The parties hereto consent to the registration of these presents for
preservation:
IN WITNESS WHEREOF these presents typewritten on this and the preceding [ ]
pages together with the Schedule annexed hereto are executed for and on behalf
of the Seller, the Mortgages Trustee and Funding 1 at [ ] on
[ ] as follows:
SUBSCRIBED for and on behalf of
HALIFAX PLC by [ ], its
Attorney, at London on [ ] 2004 before this
witness:
................................Witness ............................. Attorney
(Signature) (Signature)
................................
(Print Full Name)
................................
................................
(Address)
SUBSCRIBED for and on behalf of
PERMANENT MORTGAGES TRUSTEE LIMITED by [ ],
one of its Directors, at London on [ ] 2004
before this witness:
................................Witness ............................. Director
(Signature) (Signature)
................................
(Print Full Name)
67
................................
................................
(Address)
SUBSCRIBED for an on behalf of
PERMANENT FUNDING (NO. 1) LIMITED by [ ], one
of its Directors, at London on [ ] before
this witness:
................................Witness ............................. Director
(Signature) (Signature)
................................
(Print Full Name)
................................
................................
(Address)
68
THIS IS THE SCHEDULE REFERRED TO IN THE FOREGOING DECLARATION OF TRUST AMONG
HALIFAX PLC, PERMANENT MORTGAGES TRUSTEE LIMITED AND PERMANENT FUNDING (NO. 1)
LIMITED
DETAILS OF SCOTTISH LOANS AND RELATED SECURITY
1 2 3 4 5 6 7
Account Address Borrowers' Title Registration/ Sum Due Date of Loan
No. full names Number/ Recording Date Agreement
County
69
APPENDIX 1
PART 1 INITIAL PORTFOLIO
PART 2 STANDARD DOCUMENTATION
70
APPENDIX 2
PART 1
INITIAL PORTFOLIO
This is Part 1 (on accompanying CD-ROM) of the Exhibit to a Mortgage Sale
Agreement dated 14th June, 2002 made between Halifax plc (1) Permanent Funding
(No. 1) Limited (2) Permanent Mortgages Trustee Limited (3) and State Street
Bank and Trust Company (4).
Xxx X Xxxxxxx
HALIFAX PLC
Xxxxx Xxxxx
PERMANENT FUNDING (NO. 1) LIMITED
Xxxxx Xxxxx
PERMANENT MORTGAGES TRUSTEE LIMITED
Xxxxx Xxxxxx
STATE STREET BANK AND TRUST COMPANY
71
PART 2
STANDARD DOCUMENTATION
This is Part 2 of the Exhibit to a Mortgage Sale Agreement dated 14th June, 2002
made between Halifax plc (1) Permanent Funding (No. 1) Limited (2) Permanent
Mortgages Trustee Limited (3) and State Street Bank and Trust Company (4).
Xxx X Xxxxxxx
HALIFAX PLC
Xxxxx Xxxxx
PERMANENT FUNDING (NO. 1) LIMITED
Xxxxx Xxxxx
PERMANENT MORTGAGES TRUSTEE LIMITED
Xxxxx Xxxxxx
STATE STREET BANK AND TRUST COMPANY
72
