EXHIBIT 4.9
AMENDED AND RESTATED CASH MANAGEMENT AGREEMENT
DATED [12TH MARCH], 2004
HALIFAX PLC
AND
PERMANENT MORTGAGES TRUSTEE LIMITED
AND
PERMANENT FUNDING (NO. 1) LIMITED
AND
THE BANK OF NEW YORK
ALLEN & OVERY
LONDON
CONTENTS
CLAUSE PAGE
1. Definitions and Interpretation......................................... 2
2. Appointment of Cash Manager............................................ 2
3. The Services........................................................... 3
4. Payments, Accounts, Ledgers............................................ 4
5. Early Repayment Fees................................................... 7
6. Swaps.................................................................. 7
7. No Liability........................................................... 8
8. Costs and Expenses..................................................... 8
9. Information............................................................ 9
10. Remuneration........................................................... 11
11. Covenants of Cash Manager.............................................. 11
12. Services Non-Exclusive................................................. 12
13. Termination............................................................ 12
14. Further Assurance...................................................... 14
15. Miscellaneous.......................................................... 15
16. Confidentiality........................................................ 16
17. Notices................................................................ 16
18. Variation and Waiver................................................... 17
19. No Partnership......................................................... 17
20. Assignment............................................................. 17
21. Amendments............................................................. 18
22. Exclusion of Third Party Rights........................................ 18
23. Counterparts........................................................... 18
24. Governing Law and Submission to Jurisdiction........................... 18
SCHEDULE
1. The Cash Management Services........................................... 19
2. Cash Management and Maintenance of Ledgers............................. 21
Part 1 Form of Mortgages Trustee Quarterly Report...................... 29
Part 2 Form of Funding 1 Quarterly Report.............................. 31
3.
Signatories.................................................................. 34
THIS CASH MANAGEMENT AGREEMENT is made on [12th March], 2004
BETWEEN:
(1) HALIFAX PLC, a public limited company incorporated under the laws of
England and Wales whose registered office is at Trinity Road, Halifax,
West Yorkshire HX1 2RG, in its capacity as Cash Manager;
(2) HALIFAX PLC, a public limited company incorporated under the laws of
England and Wales whose registered office is at Trinity Road, Halifax,
West Yorkshire HX1 2RG, in its capacity as Seller of the Loans and one of
the Beneficiaries;
(3) PERMANENT MORTGAGES TRUSTEE LIMITED (registered number 83116), a private
company incorporated under the laws of Jersey, Channel Islands whose
registered office is at 47 Esplanade, St. Helier, Jersey, JE1 0BD,
Channel Islands, in its capacity as the Mortgages Trustee;
(4) PERMANENT FUNDING (NO. 1) LIMITED (registered number 4267660), a private
limited company incorporated under the laws of England and Wales whose
registered office is at Blackwell House, Guildhall Yard, London EC2V 5AE,
in its capacity as Funding 1 and one of the Beneficiaries; and
(5) THE BANK OF NEW YORK, a New York banking corporation acting through its
offices at 48th Floor, One Canada Square, London E14 5AL, 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) On the Initial Closing Date and on several subsequent dates, the Seller
agreed to sell and assign certain mortgage loans (together with their
related security) it had originated to the Mortgages Trustee. The
Mortgage Trustee holds the assigned mortgage loans as bare trustee for
Funding 1 and the Seller pursuant to the terms of the Mortgages Trust
Deed.
(B) On the Initial Closing Date and several subsequent Closing Dates, Funding
1 has used the proceeds of Intercompany Loans granted to it by Issuers to
pay the Seller for an increased share in the trust.
(C) The Cash Manager has agreed to provide Cash Management Services to the
Mortgages Trustee, Funding 1 and the Security Trustee on the terms and
subject to the conditions contained in the Cash Management Agreement
dated 14th June, 2002, as amended and restated by this Agreement and from
time to time (the CASH MANAGEMENT AGREEMENT) in relation to, inter alia,
the Trust Property.
(D) The parties to the Cash Management Agreement have agreed to amend and
restate the terms of that Agreement as set out herein.
IT IS HEREBY AGREED as follows:
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1. DEFINITIONS AND INTERPRETATION
1.1 The master definitions and construction schedule signed by, amongst
others, the parties to this Agreement and dated [12th March, 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 This Agreement amends and restates the Cash Management Agreement made on
14th June, 2002 (the PRINCIPAL AGREEMENT). As of the date of this
Agreement, any future rights or obligations (excluding such obligations
accrued to the date of this Agreement) of a party under the Principal
Agreement shall be extinguished and shall instead be governed by this
Agreement.
1.3 Any reference in this Agreement to any discretion, power or right on the
part of the Mortgages Trustee shall be exercised by the Mortgages Trustee
only as directed by the Beneficiaries but subject in each case to the
provisions of CLAUSE 16.2 of the Mortgages Trust Deed.
2. APPOINTMENT OF CASH MANAGER
2.1 APPOINTMENT
Until termination pursuant to CLAUSE 13, the Mortgages Trustee, Funding 1
and the Security Trustee (according to their respective estates and
interests) each hereby appoints the Cash Manager as its lawful agent to
provide the Cash Management Services set out in this Agreement, including
in relation to:
(a) the Mortgages Trust; and
(b) Funding 1,
and the Cash Manager in each case hereby accepts such appointment on the
terms and subject to the conditions of this Agreement.
2.2 DUTIES PRESCRIBED BY TRANSACTION DOCUMENTS
For the avoidance of doubt and in connection with the powers conferred
under CLAUSE 2.1, save as expressly provided elsewhere in this Agreement,
nothing herein shall be construed so as to give the Cash Manager any
powers, rights, authorities, directions or obligations other than as
specified in this Agreement or any of the other Transaction Documents.
2.3 APPOINTMENT CONDITIONAL UPON ISSUANCE OF FIRST ISSUER NOTES
The appointment pursuant to CLAUSE 2.1 is conditional upon the issue of
the First Issuer Notes and the making of the First Issuer Term Advances
under the First Issuer Intercompany Loan Agreement and shall take effect
upon and from the Initial Closing Date automatically without any further
action on the part of any person PROVIDED THAT if the issue of the First
Issuer Notes by the First Issuer has not occurred by 14th June, 2002, or
such later date as the
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First Issuer and the Lead Manager may agree this Agreement shall cease to
be of further effect.
3. THE SERVICES
3.1 GENERAL
The Cash Manager shall provide the services set out in this Agreement
(including, without limitation, the SCHEDULES to this Agreement) (the
CASH MANAGEMENT SERVICES).
3.2 APPROVALS AND AUTHORISATIONS
The Cash Manager shall maintain, or procure the maintenance of, the
approvals, authorisations, consents and licences required in connection
with the respective businesses of the Mortgages Trustee and Funding 1 and
shall prepare and submit, or procure the preparation and submission of,
on behalf of the Mortgages Trustee and Funding 1, all necessary
applications and requests for any further approvals, authorisations,
consents or licences which may be required in connection with the
respective businesses of the Mortgages Trustee and Funding 1 and shall,
so far as it is reasonably able to do so, perform the Cash Management
Services in such a way as not to prejudice the continuation of any such
approvals, authorisations, consents or licences.
3.3 COMPLIANCE WITH TRANSACTION DOCUMENTS, ETC.
The Cash Management Services shall include procuring (so far as the Cash
Manager, using its reasonable endeavours, is able so to do) compliance by
the Mortgages Trustee and Funding 1 with all applicable legal
requirements and with the terms of the Transaction Documents to which
each of the Mortgages Trustee and/or Funding 1 is a party, PROVIDED
ALWAYS THAT the Cash Manager shall not lend or provide any sum to the
Mortgages Trustee or Funding 1 (other than as expressly contemplated by
the Transaction Documents) and the Cash Manager shall have no liability
whatsoever to the Mortgages Trustee, Funding 1, the Security Trustee or
any other person for any failure by the Mortgages Trustee or Funding 1 to
make any payment due under any of the Transaction Documents (other than
to the extent arising from (i) the Cash Manager failing to make a payment
in its capacity as Servicer or Funding 1 Swap Provider or in any other
capacity under the Transaction Documents, or (ii) the Cash Manager
failing to perform any of its obligations under any of the Transaction
Documents).
3.4 LIABILITY OF CASH MANAGER
(a) The Cash Manager shall indemnify each of the Mortgages Trustee,
Funding 1 and the Security Trustee on demand on an after Tax basis
for any loss, liability, claim, expense or damage suffered or
incurred by any of them in respect of the negligence, bad faith or
wilful default of the Cash Manager in carrying out its functions
as Cash Manager under this Agreement or under the other
Transaction Documents or as a result of a breach by the Cash
Manager of the terms and provisions of this Agreement or such
other Transaction Documents to which the Cash Manager is a party
(in its capacity as Cash Manager) in relation to such functions.
(b) For the avoidance of doubt, the Cash Manager shall not be liable
in respect of any loss, liability, claim, expense or damage
suffered or incurred by the Mortgages Trustee, Funding 1, or the
Security Trustee and/or any other person as a result of the proper
performance of the Cash Management Services by the Cash Manager
save to the extent that such loss, liability, claim, expense or
damage is suffered or incurred as a result of any negligence, bad
faith or wilful default of the Cash Manager or as a result of a
breach by the Cash Manager of the
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terms and provisions of this Agreement or any of the other
Transaction Documents to which the Cash Manager is a party (in its
capacity as Cash Manager) in relation to such functions.
4. PAYMENTS, ACCOUNTS, LEDGERS
4.1 BANK ACCOUNTS
(a) The Cash Manager hereby confirms that the Mortgages Trustee GIC
Account has been established on or before the date hereof pursuant
to the Bank Account Agreement and the Mortgages Trustee Guaranteed
Investment Contract and that the Mortgages Trustee GIC Account
Mandate in the agreed form will apply thereto at the Initial
Closing Date. The Cash Manager undertakes (to the extent to which
the same is within its control) that at the Initial Closing Date
the Mortgages Trustee GIC Account will be operative and that the
Cash Manager will not create or permit to subsist any Security
Interest in relation to the Mortgages Trustee GIC Account (but
without prejudice to the Mortgages Trust).
(b) The Cash Manager hereby confirms that the Funding 1 GIC Account
has been established on or before the date hereof pursuant to the
Bank Account Agreement and the Funding 1 Guaranteed Investment
Contract and that the Funding 1 GIC Account Mandate in the agreed
form will apply thereto at the Initial Closing Date. The Cash
Manager undertakes (to the extent to which the same is within its
control) that at the Initial Closing Date the Funding 1 GIC
Account will be operative and that the Cash Manager will not
knowingly create or permit to subsist any Security Interest in
relation to the Funding 1 GIC Account other than as created under
or permitted pursuant to the Funding 1 Deed of Charge.
(c) The Cash Manager hereby confirms that the Funding 1 Transaction
Account has been established on or before the date hereof and that
the Funding 1 Transaction Account Mandate in the agreed form will
apply thereto at the Initial Closing Date. The Cash Manager
undertakes (to the extent to which the same is within its control)
that at the Initial Closing Date the Funding 1 Transaction Account
will be operative and that the Cash Manager will not knowingly
create or permit to subsist any Security Interest in relation to
the Funding 1 Transaction Account other than as created under or
permitted pursuant to the Funding 1 Deed of Charge.
4.2 MORTGAGES TRUSTEE LEDGERS
(a) The Cash Manager shall open and maintain in the books of the
Mortgages Trustee certain ledgers to be known as the Revenue
Ledger and the Principal Ledger which shall together reflect the
aggregate of all amounts of cash standing to the credit of the
Mortgages Trustee GIC Account from time to time.
(b) The Cash Manager shall also open and maintain in the books of the
Mortgages Trustee certain ledgers to be known as the Losses Ledger
and the Funding 1 Share/Seller Share Ledger.
(c) The Cash Manager shall make credits and debits to the Mortgages
Trustee Ledgers in the manner described in PARAGRAPHS 9, 10, 11,
12, and 13 of SCHEDULE 2.
4.3 FUNDING 1 LEDGERS
(a) The Cash Manager shall open and maintain in the books of Funding 1
certain ledgers to be known as the Funding 1 Revenue Ledger, the
Funding 1 Principal Ledger, the General Reserve Ledger, the Cash
Accumulation Ledger and, if the Liquidity Reserve Fund is
established, the Liquidity Reserve Ledger which shall together
reflect the aggregate of all amounts of cash standing to the
credit of the Funding 1 GIC Account and the Funding 1
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Transaction Account and all amounts invested in Authorised
Investments purchased from amounts standing to the credit of the
Funding 1 GIC Account and the Funding 1 Transaction Account from
time to time.
(b) The Cash Manager shall also open and maintain in the books of
Funding 1 certain ledgers to be known as (i) the Principal
Deficiency Ledger, which comprised, on the Initial Closing Date,
three sub-ledgers known as the AAA Principal Deficiency Sub
Ledger, the AA Principal Deficiency Sub Ledger and the BBB
Principal Deficiency Sub Ledger, and shall comprise on the Fourth
Issuer Closing Date, four sub-ledgers know as the AAA Principal
Deficiency Sub Ledger, the AA Principal Deficiency Sub Ledger, the
A Principal Deficiency Sub Ledger, and the BBB Principal
Deficiency Sub Ledger (ii) the Intercompany Loan Ledger and (iii)
the Funding 1 Liquidity Facility Ledger. If Funding 1 enters into
New Intercompany Loan Agreements and the New Term Advances
advanced thereunder have different Term Advance Ratings to the
Term Advance Ratings assigned to the existing Term Advances
(including the Fourth Issuer Term Advances), then the Cash Manager
shall establish new sub-ledgers in respect of the Principal
Deficiency Ledger, which shall correspond to the Term Advance
Ratings assigned to each such New Term Advance.
(c) The Cash Manager shall make credits and debits to the Funding 1
Ledgers in accordance with the provisions of PARAGRAPHS 9, 10, 14,
15, 16, 17, 18 and 19 of SCHEDULE 2.
4.4 BANK ACCOUNTS
(a) The Cash Manager shall procure that so far as it may be able in
relation to all Loans comprised in the Portfolio, the following
amounts are paid into the Mortgages Trustee GIC Account:
(i) all Monthly Payments, other interest received under and in
respect of the Loans and any costs or other amounts received
under the Loans (including in any such case amounts
recovered on enforcement of rights against any Borrower or
guarantor of the Borrower, any Property or any of the
Borrower's or guarantor's other property or assets);
(ii) all final releases and all repayments or prepayments of
principal under the Loans;
(iii) any amount received by or on behalf of the Mortgages Trustee
pursuant to any Halifax Insurance Policy or the Buildings
Policies; and
(iv) any other amounts whatsoever received by or on behalf of the
Mortgages Trustee after the Initial Closing Date,
and the Cash Manager shall procure that all interest earned on the
Mortgages Trustee GIC Account is credited to such account.
(b) The Cash Manager shall procure that the following amounts are paid
into the Funding 1 GIC Account:
(i) all Funding 1 Revenue Receipts;
(ii) all Funding 1 Principal Receipts;
(iii) all amounts received by Funding 1 pursuant to the Funding 1
Swap Agreement; and
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(iv) any other amounts whatsoever received by or on behalf of
Funding 1 after the Initial Closing Date,
and the Cash Manager shall procure that all interest earned on the
Funding 1 Bank Accounts and all investment proceeds from
Authorised Investments purchased from amounts standing to the
credit of the Funding 1 GIC Account are credited to such account.
(c) The Cash Manager shall procure that all Liquidity Drawings are
paid into the Funding 1 Transaction Account.
(d) of amounts standing to the credit of the Funding 1 Transaction
Account and the Funding 1 GIC Account shall be made in accordance
with the provisions of the Funding 1 Deed of Charge.
(e) Each of the payments into the Mortgages Trustee GIC Account and
the Funding 1 GIC Account referred to in CLAUSES 4.4(A), (B), (C)
and (D) shall be made forthwith upon receipt by the Mortgages
Trustee, Funding 1 or the Cash Manager, as the case may be, of the
amount in question.
(f) For the avoidance of doubt, as soon as reasonably practicable
after becoming aware of the same, the Cash Manager may, and shall,
withdraw Cash from, as the case may be, the Mortgages Trustee GIC
Account, the Funding 1 Transaction Account or the Funding 1 GIC
Account if, and to the extent that, such Cash was credited thereto
in error and shall use its reasonable endeavours to ensure that
such Cash is applied correctly thereafter.
(g) The Cash Manager shall promptly notify each of the Mortgages
Trustee, Funding 1 and the Security Trustee of any additional
account which supplements or replaces any account specifically
referred to in the definitions of the "Mortgages Trustee GIC
Account", the "Funding 1 Transaction Account" or the "Funding 1
GIC Account" in the Master Definitions and Construction Schedule.
(h) Each of the Cash Manager, the Mortgages Trustee and Funding 1
undertakes that, so far as it is able to procure the same, the
Mortgages Trustee GIC Account, the Funding 1 Transaction Account
and the Funding 1 GIC Account and all instructions and Mandates in
relation thereto will continue to be operative and will not, save
as provided in CLAUSE 4.6 below or as permitted pursuant to the
Bank Account Agreement, be changed without the prior written
consent of the Security Trustee (such consent not to be
unreasonably withheld or delayed). For the avoidance of doubt, the
Cash Manager may change the Authorised Signatories in respect of
any instructions or Mandates relating to Funding 1 and/or the
Mortgages Trustee, without the prior written consent of the
Security Trustee, in accordance with CLAUSE 4.2 of the Bank
Account Agreement.
(i) The Cash Manager and Funding 1 agree that the Cash Manager shall
procure that (i) the tranche of the Advance being made available
to Funding 1 pursuant to PARAGRAPH 2(A) of the First Start-Up Loan
Agreement for the purposes of funding the Reserve Fund and (ii)
the tranche (if any) of any New Start-up Loan Agreement for the
purposes of funding further the Reserve Fund (or any other similar
reserve fund) shall be credited to the Funding 1 GIC Account
promptly upon receipt of such amounts by Funding 1, and the
Reserve Ledger shall record such credit.
(j) The Cash Manager shall give all notices and make all
determinations and withdrawals under the Funding 1 Liquidity
Facility Agreement on behalf of Funding 1, as set out therein.
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4.5 WITHDRAWALS
The Cash Manager may make withdrawals:
(a) on behalf of the Mortgages Trustee from the Mortgages Trustee GIC
Account; and
(b) on behalf of Funding 1 from the Funding 1 GIC Account, but only:
(i) until receipt of an Intercompany Loan Acceleration Notice
served by the Security Trustee on Funding 1 (with a copy to
the Cash Manager and the Mortgages Trustee); [and
(ii) with the prior consent of the Security Trustee following
receipt of a request for withdrawal in writing from the Cash
Manager on behalf of Funding 1; and]
(c) on behalf of Funding 1 from the Funding 1 Transaction Account, but
only until receipt of an Intercompany Loan Acceleration Notice
served by the Security Trustee on Funding 1 (with a copy to the
Cash Manager and the Mortgages Trustee),
respectively as permitted by this Agreement, the Mortgages Trust Deed,
the Bank Account Agreement, the Mortgages Trustee Guaranteed Investment
Contract, the Funding 1 Guaranteed Investment Contract, the Funding 1
Liquidity Facility Agreement and the Funding 1 Deed of Charge, but shall
not in carrying out its functions as Cash Manager under this Agreement
otherwise make withdrawals from the Mortgages Trustee GIC Account or the
Funding 1 Bank Accounts.
4.6 CASH MANAGEMENT
In administering the Mortgages Trustee GIC Account, the Funding 1
Transaction Account and the Funding 1 GIC Account on behalf of the
Mortgages Trustee, Funding 1 and the Security Trustee respectively, the
Cash Manager shall comply with the provisions of SCHEDULE 2 prior to
receipt by the Cash Manager of a copy of any Intercompany Loan
Acceleration Notice served by the Security Trustee on Funding 1.
5. EARLY REPAYMENT FEES
The Cash Manager shall withdraw any Early Repayment Fees paid into the
Mortgages Trustee GIC Account and pay the same to the Seller, by
telegraphic transfer to such account as may be specified by the Seller
from time to time, promptly following a request for such withdrawal being
received from the Seller. For the avoidance of doubt, the Cash Manager
shall not record the receipt or withdrawal of Early Repayment Fees in any
of the ledgers maintained under this Agreement.
6. SWAPS
6.1 COMPUTATIONS UNDER FUNDING 1 SWAP
On each Calculation Date, the Cash Manager shall determine, in accordance
with the terms of the Funding 1 Swap, in respect of the relevant
Calculation Period:
(a) the Average Fixed Rate Loan Balance, the Average Variable Rate
Loan Balance and the Average Tracker Rate Loan Balance (each as
defined in the Funding 1 Swap Agreement);
7
(b) the weighted average of the fixed rates of interest charged to
borrowers of Fixed Rate Loans;
(c) the Tracker Swap Rate; and
(d) the Variable Rate Swap SVR,
and shall notify Funding 1 and the Security Trustee of such amounts,
balances and rates.
6.2 TERMINATION OF FUNDING 1 SWAP
If on or prior to the date of the earlier of either (i) the reduction of
the aggregate principal amount outstanding of all Intercompany Loans to
zero or (ii) the service of an Intercompany Loan Acceleration Notice, the
Funding 1 Swap is terminated, then the Cash Manager (on behalf of Funding
1 and the Security Trustee) shall purchase a new hedge against the
possible variance between (1) the Mortgages Trustee Variable Base Rate
payable on the Variable Rate Loans, the fixed rates of interest payable
on the Fixed Rate Loans and the Tracker Swap Rate and (2) a LIBOR-based
rate for three-month sterling deposits, on terms acceptable to Funding 1
and the Rating Agencies with a new Funding 1 swap provider whom the
Rating Agencies have previously confirmed in writing will not cause the
then current rating of any Notes to be downgraded. The Cash Manager may
apply any early termination payment received from the Funding 1 Swap
Provider pursuant to the Funding 1 Swap for such purpose.
7. NO LIABILITY
Save as otherwise provided in this Agreement, the Cash Manager shall have
no liability for the obligations of either the Mortgages Trustee, Funding
1 or the Security Trustee under any of the Transaction Documents or
otherwise and nothing herein shall constitute a guarantee, or similar
obligation, by the Cash Manager of either the Mortgages Trustee, Funding
1 or the Security Trustee in respect of any of them.
8. COSTS AND EXPENSES
8.1 Subject to and in accordance with the applicable Funding 1 Priority of
Payments set out in the Funding 1 Deed of Charge, Funding 1 will on each
Funding 1 Interest Payment Date reimburse the Cash Manager for all out-
of-pocket costs, expenses and charges (together with any amounts in
respect of Irrecoverable VAT due thereon) properly incurred by the Cash
Manager in the performance of the Cash Management Services including any
such costs, expenses or charges not reimbursed to the Cash Manager on any
previous Funding 1 Interest Payment Date and the Cash Manager shall
supply the Mortgages Trustee or Funding 1 with an appropriate VAT invoice
issued by the Cash Manager or, if the Cash Manager has treated the
relevant cost, expense or charge as a disbursement for VAT purposes, by
the person making the supply.
8.2 Unless and until otherwise agreed by Funding 1 and the Security Trustee
in writing (notified to the Cash Manager), Funding 1 shall be solely
responsible for reimbursing the Cash Manager for the out-of-pocket costs,
expenses and charges (together with any amounts in respect of
Irrecoverable VAT due thereon) referred to in CLAUSE 8.1 above.
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9. INFORMATION
9.1 USE OF I.T. SYSTEMS
(a) The Cash Manager represents and warrants that at the date hereof
in respect of the software which is to be used by the Cash Manager
in providing the Cash Management Services it has in place all
necessary licences and/or consents from the respective licensor or
licensors (if any) of such software.
(b) The Cash Manager undertakes that it shall for the duration of this
Agreement, use reasonable endeavours to:
(i) ensure that the licences and/or consents referred to in
paragraph are maintained in full force and effect; and
(ii) except in so far as it would breach any other of its legal
obligations, grant to any person to whom it may sub-contract
or delegate the performance of all or any of its powers and
obligations under this Agreement and/or to such person as
the Mortgages Trustee and Funding 1 elect as a substitute
cash manager in accordance with the terms of this Agreement
a licence to use any proprietary software together with any
updates which may be made thereto from time to time.
(c) The Cash Manager shall use reasonable endeavours to maintain in
working order the information technology systems used by the Cash
Manager in providing the Cash Management Services.
(d) The Cash Manager shall pass to any person to whom it may sub-
contract or delegate the performance of all or any of its powers
and obligations under this Agreement and/or to such person as the
Mortgages Trustee and Funding 1 elect as a substitute cash manager
in accordance with the terms of this Agreement the benefit of any
warranties in relation to the software insofar as the same are
capable of assignment.
9.2 BANK ACCOUNT STATEMENTS
The Cash Manager shall take all reasonable steps to ensure that it
receives:
(a) a monthly bank statement in relation to the Mortgages Trustee GIC
Account (and any additional or supplemental bank account of the
Mortgages Trustee) and that it furnishes a copy of such statement
to the Mortgages Trustee, each of the Beneficiaries and the
Security Trustee; and
(b) monthly bank statements in relation to each of the Funding 1
Transaction Account and the Funding 1 GIC Account (and any
additional or supplemental bank account of the Funding 1 Trustee)
and that it furnishes a copy of such statements to Funding 1 and
the Security Trustee.
9.3 ACCESS TO BOOKS AND RECORDS
Subject to all applicable laws, the Cash Manager shall permit the
Auditors of the Mortgages Trustee and Funding 1 and any other person
nominated by the Security Trustee or the Beneficiaries (to whom the Cash
Manager has no reasonable objection) at any time during normal office
hours upon reasonable notice to have access, or procure that such person
or persons are granted access, to all books of record and account
relating to the Cash
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Management Services provided by the Cash Manager and related matters in
accordance with this Agreement.
9.4 STATUTORY OBLIGATIONS
The Cash Manager will use its reasonable endeavours, on behalf of the
Mortgages Trustee and Funding 1, to prepare or procure the preparation of
and file all reports, annual returns, financial statements, statutory
forms and other returns which each of the Mortgages Trustee and Funding 1
is required by law to prepare and file. Subject to approval thereof by
the directors of the Mortgages Trustee or Funding 1 (as appropriate), the
Cash Manager shall cause such accounts to be audited by the Auditors and
shall procure so far as it is able so to do that the Auditors shall make
a report thereon as required by law and copies of all such documents
shall be delivered to the Mortgages Trustee, the Security Trustee and
Funding 1 (as appropriate) and the Rating Agencies as soon as practicable
after the end of each accounting reference period of the Mortgages
Trustee or Funding 1 (as appropriate).
9.5 INFORMATION COVENANTS
(a) The Cash Manager shall provide the Mortgages Trustee, Funding 1,
the Security Trustee, the Seller and the Rating Agencies:
(i) quarterly with a report in, or substantially in, the form
set out in Part 1 of SCHEDULE 3 in respect of the Mortgages
Trustee; and
(ii) quarterly with a report in, or substantially in, the form
set out in Part 2 of SCHEDULE 3 in respect of Funding 1.
(b) The Cash Manager shall provide, or procure the provision of, to
the Mortgages Trustee, Funding 1, the Security Trustee and the
Rating Agencies copies of any annual returns or financial
statements referred to in CLAUSE 9.4 as soon as reasonably
practicable after the preparation thereof.
(c) The Cash Manager shall notify the Rating Agencies in writing of
the details of (i) any material amendment to the Transaction
Documents, (ii) the occurrence of an Intercompany Loan Event of
Default or Potential Intercompany Loan Event of Default and (iii)
any other information relating to the Cash Manager as the Rating
Agencies and the Security Trustee may reasonably request in
connection with its obligations under this Agreement, PROVIDED
THAT the Security Trustee shall not make such a request more than
once every three months unless, in the belief of the Security
Trustee, an Intercompany Loan Event of Default, a Note Event of
Default or Cash Manager Termination Event (as defined in CLAUSE
13.1) shall have occurred and is continuing or a Potential
Intercompany Loan Event of Default or a Potential Note Event of
Default shall have accrued and is continuing PROVIDED FURTHER THAT
such request does not adversely interfere with the Cash Manager's
day to day provision of the Cash Management Services under the
other terms of this Agreement.
(d) The Cash Manager shall, at the request of the Security Trustee,
furnish the Security Trustee and the Rating Agencies with such
other information relating to its business and financial condition
as it may be reasonable for the Security Trustee to request in
connection with this Agreement, PROVIDED THAT such request does
not adversely interfere with the Cash Manager's day to day
provision of the Cash Management Services under the other terms of
this Agreement.
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10. REMUNERATION
10.1 FEE PAYABLE
(a) Subject to PARAGRAPH (B) below, Funding 1 shall pay to the Cash
Manager for its Cash Management Services hereunder a cash
management fee which shall be agreed in writing between Funding 1,
the Security Trustee and the Cash Manager from time to time.
(b) Unless and until otherwise agreed by Funding 1 and the Security
Trustee in writing (notified to the Cash Manager), Funding 1 shall
be solely responsible for paying the cash management fee to the
Cash Manager which is referred to in PARAGRAPH (A) above.
10.2 PAYMENT OF FEE
The cash management fee referred to in CLAUSE 10.1 shall be paid to the
Cash Manager in arrear on each Funding 1 Interest Payment Date in the
manner contemplated by and in accordance with the provisions of the
applicable Funding 1 Priority of Payments.
11. COVENANTS OF CASH MANAGER
11.1 COVENANTS
The Cash Manager hereby covenants with and undertakes to each of the
Mortgages Trustee, Funding 1 and the Security Trustee that without
prejudice to any of its specific obligations hereunder:
(a) it will devote all due skill, care and diligence to the
performance of its obligations and the exercise of its discretions
hereunder;
(b) it will comply with any proper directions, orders and instructions
which the Mortgages Trustee, Funding 1 or the Security Trustee may
from time to time give to it in accordance with the provisions of
this Agreement and, in the event of any conflict, those of the
Security Trustee shall prevail;
(c) it will use its reasonable endeavours to keep in force all
licences, approvals, authorisations and consents which may be
necessary in connection with the performance of the Cash
Management Services and prepare and submit all necessary
applications and requests for any further approval, authorisation,
consent or licence required in connection with the performance of
the Cash Management Services;
(d) save as otherwise agreed with the Mortgages Trustee, Funding 1 and
the Security Trustee, it will provide free of charge to the
Mortgages Trustee and Funding 1 during normal office hours office
space, facilities, equipment and staff sufficient to fulfil the
obligations of the Mortgages Trustee and Funding 1 under this
Agreement;
(e) it will not knowingly fail to comply with any legal requirements
in the performance of the Cash Management Services;
(f) it will make all payments required to be made by it pursuant to
this Agreement on the due date for payment thereof for value on
such day without set-off (including, without limitation, in
respect of any fees owed to it) or counterclaim; and
(g) it will not without the prior written consent of the Security
Trustee amend or terminate any of the Transaction Documents save
in accordance with their terms.
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11.2 DURATION OF COVENANTS
The covenants of the Cash Manager in CLAUSE 11.1 shall remain in force
until this Agreement is terminated but without prejudice to any right or
remedy of the Mortgages Trustee and/or Funding 1 and/or the Security
Trustee arising from breach of any such covenant prior to the date of
termination of this Agreement.
12. SERVICES NON-EXCLUSIVE
Nothing in this Agreement shall prevent the Cash Manager from rendering
or performing services similar to those provided for in this Agreement to
or for itself or other persons, firms or companies or from carrying on
business similar to or in competition with the business of the Mortgages
Trustee, Funding 1 or the Security Trustee.
13. TERMINATION
13.1 CASH MANAGER TERMINATION EVENTS
If any of the following events (CASH MANAGER TERMINATION EVENTS) shall
occur:
(a) default is made by the Cash Manager in the payment on the due date
of any payment due and payable by it under this Agreement or in
the performance of its obligations under CLAUSES 4.4 and 4.5 and
such default continues unremedied for a period of three London
Business Days after the earlier of the Cash Manager becoming aware
of such default; or
(b) default is made by the Cash Manager in the performance or
observance of any of its other covenants and obligations under
this Agreement, which in the reasonable opinion of Funding 1
and/or the Security Trustee is materially prejudicial to the
interests of the Funding 1 Secured Creditors and such default
continues unremedied for a period of twenty days after the earlier
of the Cash Manager becoming aware of such default and receipt by
the Cash Manager of written notice from the Security Trustee
requiring the same to be remedied;
(c) an Insolvency Event occurs,
then Funding 1 and/or the Security Trustee may at once or at any time
thereafter while such default continues by notice in writing to the Cash
Manager terminate its appointment as Cash Manager under this Agreement
with effect from a date (not earlier than the date of the notice)
specified in the notice.
13.2 RESIGNATION OF CASH MANAGER
The appointment of the Cash Manager under this Agreement may be
terminated upon the expiry of not less than 12 months' notice of
termination given by the Cash Manager to the Mortgages Trustee, Funding 1
and the Security Trustee PROVIDED THAT:
(a) the Mortgages Trustee, Funding 1 and the Security Trustee consent
in writing to such termination;
(b) a substitute cash manager shall be appointed, such appointment to
be effective not later than the date of such termination;
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(c) such substitute cash manager has cash management experience and is
approved by the Mortgages Trustee, Funding 1 and the Security
Trustee;
(d) the substitute cash manager enters into an agreement substantially
on the same terms as the relevant provisions of this Agreement and
the Cash Manager shall not be released from its obligations under
the relevant provisions of this Agreement until such substitute
cash manager has entered into such new agreement and the rights of
the Mortgages Trustee and Funding 1 under such agreement are
charged in favour of the Security Trustee on terms satisfactory to
the Security Trustee; and
(e) the then current ratings of the Notes are not adversely affected
as a result thereof, unless otherwise agreed by an Extraordinary
Resolution (as defined in the trust deeds of each Issuer) of the
holders of each class of the Notes of each Issuer.
13.3 EFFECT OF TERMINATION
(a) On and after termination of the appointment of the Cash Manager
under this Agreement pursuant to this Clause , all authority and
power of the Cash Manager under this Agreement shall be terminated
and be of no further effect and the Cash Manager shall not
thereafter hold itself out in any way as the agent of the
Mortgages Trustee, Funding 1 or the Security Trustee pursuant to
this Agreement.
(b) Upon termination of the appointment of the Cash Manager under this
Agreement pursuant to this CLAUSE 13, the Cash Manager shall:
(i) forthwith deliver (and in the meantime hold on trust for,
and to the order of, the Mortgages Trustee, Funding 1 or the
Security Trustee, as the case may be) to the Mortgages
Trustee, Funding 1 or the Security Trustee, as the case may
be or as it shall direct, all books of account, papers,
records, registers, correspondence and documents in its
possession or under its control relating to the affairs of
or belongings of the Mortgages Trustee, Funding 1 or the
Security Trustee, as the case may be (if practicable, on the
date of receipt), any monies then held by the Cash Manager
on behalf of the Mortgages Trustee, Funding 1 or, the
Security Trustee and any other assets of the Mortgages
Trustee, Funding 1 and the Security Trustee;
(ii) take such further action as the Mortgages Trustee, Funding 1
or the Security Trustee, as the case may be, may reasonably
direct at the expense of the Mortgages Trustee, Funding 1 or
the Security Trustee, as the case may be (including in
relation to the appointment of a substitute cash manager),
provided that the Mortgages Trustee or the Security Trustee,
as the case may be, shall not be required to take or direct
to be taken such further action unless it has been
indemnified to its satisfaction (and in the event of a
conflict between the directors of Funding 1, the Mortgages
Trustee and the Security Trustee, the director of the
Security Trustee shall prevail);
(iii) provide all relevant information contained on computer
records in the form of magnetic tape, together with details
of the layout of the files encoded on such magnetic tapes;
and
(iv) co-operate and consult with and assist the Mortgages
Trustee, Funding 1 or the Security Trustee or its nominee,
as the case may be (which shall, for the avoidance of doubt,
include any Receiver appointed by it), for the purposes of
explaining the file layouts and the format of the magnetic
tapes generally containing such computer records on the
computer system of the Mortgages Trustee, Funding 1, or the
Security Trustee or such nominee, as the case may be.
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13.4 NOTICE OF EVENT OF DEFAULT
The Cash Manager shall deliver to the Mortgages Trustee, Funding 1 and
the Security Trustee as soon as reasonably practicable but in any event
within three London Business Days of becoming aware thereof a notice of
any Cash Manager Termination Event or any event which with the giving of
notice or expiry of any grace period or certification, as specified in
such Cash Manager Termination Event would constitute the same or any
Intercompany Loan Event of Default or any Potential Intercompany Loan
Event of Default.
13.5 GENERAL PROVISIONS RELATING TO TERMINATION
(a) Termination of this Agreement or the appointment of the Cash
Manager under this Agreement shall be without prejudice to the
liabilities of the Mortgages Trustee, Funding 1 and the Security
Trustee to the Cash Manager or vice versa incurred before the date
of such termination. The Cash Manager shall have no right of set-
off or any lien in respect of such amounts against amounts held by
it on behalf of the Mortgages Trustee, Funding 1 or the Security
Trustee.
(b) This Agreement shall terminate automatically at such time as
Funding 1 has no further interest in the Trust Property and the
Intercompany Loans have been fully repaid or Funding 1's
obligations under the Intercompany Loans have been otherwise
discharged.
(c) On termination of the appointment of the Cash Manager under the
provisions of this CLAUSE 13, the Cash Manager shall be entitled
to receive all fees and other monies accrued up to (but excluding)
the date of termination but shall not be entitled to any other or
further compensation. Such monies so receivable by the Cash
Manager shall be paid by Funding 1, on the dates on which they
would otherwise have fallen due hereunder and under the terms of
the Funding 1 Deed of Charge. For the avoidance of doubt, such
termination shall not affect the Cash Manager's rights to receive
payment of all amounts (if any) due to it from Funding 1 other
than under this Agreement.
(d) Any provision of this Agreement which is stated to continue after
termination of the Agreement shall remain in full force and effect
notwithstanding termination.
14. FURTHER ASSURANCE
14.1 CO-OPERATION, ETC.
The parties hereto agree that they will co-operate fully to do all such
further acts and things and execute any further documents as may be
necessary or desirable to give full effect to the arrangements
contemplated by this Agreement.
14.2 POWERS OF ATTORNEY
Without prejudice to the generality of CLAUSE 14.1 , the Mortgages
Trustee, Funding 1 and the Security Trustee shall upon request by the
Cash Manager forthwith give to the Cash Manager such further powers of
attorney or other written authorisations, mandates or instruments as are
necessary to enable the Cash Manager to perform the Cash Management
Services.
14.3 CHANGE OF SECURITY TRUSTEE
In the event that there is any change in the identity of the Security
Trustee or an additional Security Trustee is appointed in accordance with
the Funding 1 Deed of Charge, as the case may be, the Cash Manager shall
execute such documents with any other parties to this
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Agreement and take such actions as such new Security Trustee may
reasonably require for the purposes of vesting in such new Security
Trustee the rights of the Security Trustee under this Agreement and under
the Funding 1 Deed of Charge and releasing the retiring Security Trustee
from further obligations thereunder and while any of the Notes of any
Issuer remains outstanding shall give notice thereof to the Rating
Agencies.
14.4 NO OBLIGATION ON SECURITY TRUSTEE
Nothing herein contained shall impose any obligation or liability on the
Security Trustee to assume or perform any of the obligations of the
Mortgages Trustee, Funding 1 or the Cash Manager hereunder or render it
liable for any breach thereof.
15. MISCELLANEOUS
15.1 NO SET-OFF
Each of the Seller and the Cash Manager agrees that it will not:
(a) set off or purport to set off any amount which either the
Mortgages Trustee or Funding 1 is or will become obliged to pay to
it under this Agreement against any amount from time to time
standing to the credit of or to be credited to the Mortgages
Trustee GIC Account, the Funding 1 Transaction Account or the
Funding 1 GIC Account or any replacement or additional bank
account of either the Mortgages Trustee or Funding 1; or
(b) make or exercise any claims or demands, any rights of counterclaim
or any other equities against or withhold payment of any and all
sums of money which may at any time and from time to time be
standing to the credit of the Mortgages Trustee GIC Account, the
Funding 1 Transaction Account or the Funding 1 GIC Account or any
replacement of additional bank account of either the Mortgages
Trustee or Funding 1.
15.2 NO PETITION
The Cash Manager agrees that for so long as any Notes of any Issuer are
outstanding it will not petition or commence proceedings for the
administration (including, for the avoidance of doubt, the filing of
documents with the court or the service of a notice of intention to
appoint an administrator) or winding up of the Mortgages Trustee, Funding
1 or any Issuer or participate in any ex parte proceedings with regard
thereto.
15.3 NO RECOURSE
(a) In relation to all sums due and payable by the Mortgages Trustee
or Funding 1 to the Cash Manager, the Cash Manager agrees that it
shall have recourse only to sums paid to or received by (or on
behalf of) the Mortgages Trustee or Funding 1 pursuant to the
provisions of the Transaction Documents.
(b) For the avoidance of doubt, the Security Trustee shall not be
liable to pay any amounts due under CLAUSES 6 and 8, and without
prejudice to the obligations of the Mortgages Trustee or Funding
1, as the case may be, or any receiver appointed pursuant to the
Funding 1 Deed of Charge in respect of such amounts.
(c) Notwithstanding any other provisions of this Agreement, all
obligations to, and rights of, the Security Trustee under or in
connection with this Agreement (other than its obligations under
CLAUSE 14) shall automatically terminate upon the discharge in
full of the Funding 1 Secured
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Obligations, PROVIDED THAT this shall be without prejudice to any
claims in respect of such obligations and rights arising on or
prior to such date.
16. CONFIDENTIALITY
During the continuance of this Agreement or after its termination, each
of the Mortgages Trustee, the Cash Manager, the Seller, Funding 1 and the
Security Trustee shall use its best endeavours not to disclose to any
person, firm or company whatsoever any information relating to the
business, finances or other matters of a confidential nature of any other
party hereto of which it may exclusively by virtue of being party to the
Transaction Documents have become possessed and shall use all reasonable
endeavours to prevent any such disclosure as aforesaid, PROVIDED HOWEVER
that the provisions of this CLAUSE 16 shall not apply:
(a) to any information already known to the recipient otherwise than
as a result of entering into any of the Transaction Documents;
(b) to any information subsequently received by the recipient which it
would otherwise be free to disclose;
(c) to any information which is or becomes public knowledge otherwise
than as a result of the conduct of the recipient;
(d) to any extent that the recipient is required to disclose the same
pursuant to any law or order of any court of competent
jurisdiction or pursuant to any direction, request or requirement
(whether or not having the force of law) of any central bank or
any governmental or other authority (including, without
limitation, any official bank examiners or regulators);
(e) to the extent that the recipient needs to disclose the same for
determining the existence of, or declaring, a Note Event of
Default, an Intercompany Loan Event of Default or a Cash Manager
Termination Event, the protection or enforcement of any of its
rights under any of the Transaction Documents or in connection
herewith or therewith or for the purpose of discharging, in such
manner as it thinks fit, its duties under or in connection with
such agreements in each case to such persons as require to be
informed of such information for such purposes; or
(f) in relation to any information disclosed to the professional
advisers of the recipient or (in connection with a prospective
rating of any debt issued or to be issued by an Issuer or any New
Issuer) to any Rating Agency or any prospective new cash manager
or prospective new security trustee.
17. NOTICES
Any notices to be given pursuant to this Agreement to any of the parties
hereto shall be sufficiently served if sent by prepaid first class post,
by hand or facsimile transmission and shall be deemed to be given (in the
case of facsimile transmission) when despatched, (where delivered by
hand) on the day of delivery if delivered before 17.00 hours on a London
Business Day or on the next London Business Day if delivered thereafter
or on a day which is not a London Business Day or (in the case of first
class post) when it would be received in the ordinary course of the post
and shall be sent:
(a) in the case of the Cash Manager, to Halifax plc, Trinity Road,
Halifax, West Yorkshire HX1 2RG (LP/3/3/SEC)_(facsimile number +44
(0) 113 235 7511) for the
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attention of the Head of Mortgage Securitisation with a copy to
HBOS Treasury Services plc, 33 Old Broad Street, London EC2N 1HZ
(facsimile number +44 (0) 20 7574 8784) for the attention of Head
of Capital Markets and Securitisation;
(b) in the case of the Mortgages Trustee, to Permanent Mortgages
Trustee Limited, Blackwell House, Guildhall Yard, London EC2V 5AE
(facsimile number +44 (0) 20 7556 0975) for the attention of the
Secretary with a copy to HBOS Treasury Services plc, 33 Old Broad
Street, London EC2N 1HZ (facsimile number +44 (0) 20 7574 8784)
for the attention of Head of Capital Markets and Securitisation;
(c) in the case of the Seller, to Halifax plc, Trinity Road, Halifax,
West Yorkshire HX1 2RG (LP/3/3/SEC) (facsimile number +44 (0) 113
235 7511) for the attention of the Head of Mortgage Securitisation
with a copy to HBOS Treasury Services plc, 33 Old Broad Street,
London EC2N 1HZ (facsimile number +44 (0) 20 7574 8784) for the
attention of Head of Capital Markets and Securitisation;
(d) in the case of Funding 1, to Permanent Funding (No.1) Limited,
Blackwell House, Guildhall Yard, London EC2V 5AE (facsimile number
+44 (020) 7556 0975) for the attention of the Secretary with a
copy to HBOS Treasury Services plc, 33 Old Broad Street, London
EC2N 1HZ (facsimile number +44 (020) 7574 8784) for the attention
of Head of Capital Markets & Securitisation; and
(e) in the case of the Security Trustee, to The Bank of New York, One
Canada Square, London E14 5AL (facsimile number +44 (0) 20 7964
6061/6399) for the attention of Global Structured Finance -
Corporate Trust,
or to such other address or facsimile number or for the attention of such
other person or entity as may from time to time be notified by any party
to the others by written notice in accordance with the provisions of this
CLAUSE 17.
18. VARIATION AND WAIVER
No variation or waiver of this Agreement shall be effective unless it is
in writing and signed by (or by some person duly authorised by) each of
the parties. No single or partial exercise of, or failure or delay in
exercising, any right under this Agreement shall constitute a waiver or
preclude any other or further exercise of that or any other right.
19. NO PARTNERSHIP
It is hereby acknowledged and agreed by the parties that nothing in this
Agreement shall be construed as giving rise to any partnership between
any of the parties.
20. ASSIGNMENT
20.1 ASSIGNMENT BY THE MORTGAGES TRUSTEE AND FUNDING 1
Neither of the Mortgages Trustee nor Funding 1 may assign or transfer any
of its respective rights and obligations under this Agreement without the
prior written consent of:
(a) in the case of the Mortgages Trustee, each of the Beneficiaries
and the Security Trustee; and
(b) in the case of Funding 1, each of the Security Trustee and the
Cash Manager,
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except that Funding 1 may assign its respective rights hereunder without
such consent pursuant to the Funding 1 Deed of Charge.
20.2 NO ASSIGNMENT BY CASH MANAGER
The Cash Manager may not assign or transfer any of its rights and
obligations under this Agreement without the prior written consent of the
Mortgages Trustee, each of the Beneficiaries, Funding 1 and the Security
Trustee.
21. AMENDMENTS
Subject to CLAUSE 25 of the Funding 1 Deed of Charge (Supplemental
Provisions Regarding the Security Trustee), any amendments to this
Agreement will be made only with the prior written consent of each party
to this Agreement.
22. EXCLUSION OF THIRD PARTY RIGHTS
The parties to this Agreement do not intend that any term of this
Agreement should be enforced, by virtue of the Contracts (Rights of Third
Parties) Act 1999, by any person who is not a party to this Agreement.
23. COUNTERPARTS
This Agreement may be executed in any number of counterparts (manually or
by facsimile) each of which, when executed and delivered, shall
constitute an original, but all the counterparts shall together
constitute but one and the same instrument provided, however, that this
Agreement shall have no force or effect until it is executed by the last
party to execute the same and shall be deemed to have been executed and
delivered in the place where such last party executed this Agreement.
24. GOVERNING LAW AND SUBMISSION TO JURISDICTION
24.1 This Agreement is governed by, and shall be construed in accordance with,
the laws of England.
24.2 Each party to this Agreement hereby irrevocably submits to the non-
exclusive jurisdiction of the English courts in any action or proceeding
arising out of or relating to this Agreement, and hereby irrevocably
agrees that all claims in respect of such action or proceeding may be
heard and determined by such courts. Each party to this Agreement hereby
irrevocably waives, to the fullest extent it may possibly do so, any
defence or claim that the English courts are an inconvenient forum for
the maintenance or hearing of such action or proceeding. The Mortgages
Trustee irrevocably appoints Structured Finance Management Limited at
Blackwell House, Guildhall Yard, London EC2V 5AE as its agent for the
service of process.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed the
day and year first before written.
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SCHEDULE 1
THE CASH MANAGEMENT SERVICES
The Cash Manager shall:
(a) operate the Mortgages Trustee GIC Account, the Funding 1 GIC Account and
the Funding 1 Transaction Account or any other Bank Account and ensure
that payments are made into and from such accounts in accordance with
this Agreement, the Mortgages Trust Deed, the Funding 1 Deed of Charge,
the Bank Account Agreement, the Mortgages Trustee Guaranteed Investment
Contract, the Funding 1 Guaranteed Investment Contract and any other
applicable Transaction Document PROVIDED HOWEVER THAT nothing herein
shall require the Cash Manager to make funds available to the Mortgages
Trustee or Funding 1 to enable such payments to be made other than as
expressly required by the provisions of this Agreement;
(b) keep records for all taxation purposes (including, without limitation
VAT);
(c) assist the auditors of the Mortgages Trustee and Funding 1 and provide
such information to them as they may reasonably request for the purpose
of carrying out their duties as auditors;
(d) make all filings, give all notices and make all registrations and other
notifications required in the day-to-day operation of the respective
businesses of the Mortgages Trustee and Funding 1 or required to be given
by the Mortgages Trustee or Funding 1 pursuant to the Transaction
Documents;
(e) arrange for all payments due to be made by the Mortgages Trustee and/or
Funding 1 under any of the Transaction Documents, PROVIDED THAT such
monies are at the relevant time available to the Mortgages Trustee and/or
Funding 1 and PROVIDED FURTHER that nothing herein shall constitute a
guarantee by the Cash Manager of all or any of the obligations of the
Mortgages Trustee or Funding 1 under any of the Transaction Documents;
(f) without prejudice to the role of and in conjunction with the relevant
Corporate Services Provider under the relevant Corporate Services
Agreement, keep general books of account and records of the Mortgages
Trustee and Funding 1; provide accounting services, including reviewing
receipts and payments, supervising and assisting in the preparation of
interim statements and final accounts and supervising and assisting in
the preparation of Tax returns;
(g) without prejudice to the role of and in conjunction with the relevant
Corporate Services Provider under the relevant Corporate Services
Agreement, provide or procure the provision of company secretarial and
administration services to the Mortgages Trustee and Funding 1 including
the keeping of all registers and the making of all returns and filings
required by applicable law or by US or UK regulatory authorities
(including the Securities and Exchange Commission), co-operate in the
convening of board and general meetings and provide registered office
facilities;
(h) itself on behalf of the Mortgages Trustee and Funding 1, PROVIDED THAT
such monies are at the relevant time available to the Mortgages Trustee
and Funding 1, pay all the out-of-pocket expenses of the Mortgages
Trustee and Funding 1, incurred by the Cash Manager on behalf of the
Mortgages Trustee and Funding 1 in the performance of the Cash Manager's
duties hereunder including without limitation:
(i) all Taxes which may be due or payable by the Mortgages Trustee and
Funding 1;
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(ii) all registration, transfer, filing and other fees and other
charges payable in respect of the sale by the Seller of the
Portfolio to the Mortgages Trustee;
(iii) all necessary filing and other fees in compliance with regulatory
requirements;
(iv) all legal and audit fees and other professional advisory fees;
(v) all communication expenses including postage, courier and
telephone charges; and
(vi) all premiums payable by the Mortgages Trustee in respect of the
Insurance Policies;
(i) at the request of Funding 1 (but also with the prior written consent of
the Security Trustee), invest monies standing from time to time to the
credit of the Funding 1 GIC Account and the Funding 1 Liquidity Stand-by
Account, if any, in Authorised Investments, subject to the following
provisions:
(i) any such Authorised Investment shall be made in the joint names of
Funding 1 and the Security Trustee; and
(ii) any costs properly and reasonably incurred in making and changing
Authorised Investments will be reimbursed to the Cash Manager and
the Security Trustee by Funding 1; and
(iii) all income or other distributions arising on, or proceeds
following the disposal or maturity of, Authorised Investments
shall be credited to the Funding 1 GIC Account;
(iv) the Security Trustee and the Cash Manager shall not be responsible
(save where any loss results from the Security Trustee's or the
Cash Manager's, as the case may be, own fraud, wilful default or
negligence or that of their respective officers or employees) for
any loss occasioned by reason of any such Authorised Investments
whether by depreciation in value or otherwise provided that such
Authorised Investments were made in accordance with the above
provisions.
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SCHEDULE 2
CASH MANAGEMENT AND MAINTENANCE OF LEDGERS
1. DETERMINATION
(a) On each Calculation Date based on the amount of monies standing to the
credit of the Mortgages Trustee GIC Account as at close of business on
the London Business Day immediately preceding the relevant Calculation
Date, the Cash Manager shall determine each of the following:
(i) the amount of Principal Receipts and Revenue Receipts received
during the preceding Calculation Period;
(ii) the amount of any Mortgages Trust Available Revenue Receipts
received during the preceding Calculation Period; and
(iii) the amount of Mortgages Trust Available Revenue Receipts and
Principal Receipts to be distributed to Funding 1 and to the
Seller on the Distribution Date immediately following the relevant
Calculation Date.
(b) On each Calculation Date, the Cash Manager shall determine each of the
following:
(i) the amount of any Losses incurred on the Loans in the period from
the immediately preceding Calculation Date to the relevant
Calculation Date;
(ii) the Funding 1 Share, the Seller Share, the Funding 1 Share
Percentage and the Seller Share Percentage in accordance with
CLAUSE 8 of the Mortgages Trust Deed; and
(iii) the Minimum Seller Share in accordance with CLAUSE 9.2 of the
Mortgages Trust Deed.
(c) Four Business Days prior to each Funding 1 Interest Payment Date the Cash
Manager shall determine each of the following:
(i) the amount of any Funding 1 Available Revenue Receipts to be
applied on the following Funding 1 Interest Payment Date in
accordance with the Funding 1 Pre-Enforcement Revenue Priority of
Payments;
(ii) the amount of any Funding 1 Available Principal Receipts to be
applied on the following Funding 1 Interest Payment Date in
accordance with Funding 1's Principal Priorities of Payments; and
(iii) the amount of any Funding 1 Income Deficit.
(d) The Cash Manager shall make all the determinations referred to in
paragraphs to above on the basis of the following assumptions:
(i) that the amount of any Losses will not increase;
(ii) that any debit balance on the Principal Deficiency Ledger will not
increase; and
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(iii) such other assumptions (including without limitation as to the
amount of any payments or provisions to be made in accordance with
the applicable Funding 1 Priority of Payments during the period
from and including the Intercompany Loan Determination Date prior
to each Funding 1 Interest Payment Date to and excluding such
Funding 1 Interest Payment Date) as the Cash Manager considers
appropriate.
The Cash Manager shall on request notify the Mortgages Trustee, Funding 1
and the Security Trustee in writing of any such other assumptions and
shall take account of any representations made by the Mortgages Trustee,
Funding 1 and the Trustee (as the case may be) in relation thereto.
(e) The Cash Manager shall:
(i) make or procure to be made all returns and filings required to be
made by Funding 1 and the Mortgages Trustee;
(ii) provide or procure the provision of company secretarial and
administration services to Funding 1 and the Mortgages Trustee
including the keeping of all registers and the making of all
returns required by applicable law or by UK regulatory
authorities, co-operate in the convening of board and general
meetings and provide registered office facilities;
(iii) itself on behalf of Funding 1 and the Mortgages Trustee, provided
that such moneys are at the relevant time available to Funding 1
and the Mortgages Trustee, pay all out-of-pocket expenses of
Funding 1 and the Mortgages Trustee incurred in the performance of
the Cash Manager's duties hereunder including, without limitation,
all fees payable to the London Stock Exchange Limited.
(f) The Cash Manager shall, if necessary, perform all currency conversions
free of charge, cost or expense at the relevant exchange rate (for the
purposes of any calculations referred to above, (i) all percentages
resulting from such calculations will be rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point (e.g. 9.876541%
being rounded down to 9.87654% and (ii) any currency amounts used in or
resulting from such calculations will be rounded in accordance with the
relevant market practice).
(g) Each determination made in accordance with this paragraph shall (in the
absence of bad faith, wilful default, negligence and manifest error) be
final and binding on all persons.
2. NOTIFICATION OF DETERMINATIONS
(a) The Cash Manager will cause each determination of Principal Receipts,
Revenue Receipts, Losses, Mortgages Trust Available Revenue Receipts, the
Funding 1 Share and the Seller Share, the Funding 1 Share Percentage, the
Seller Share Percentage and the Minimum Seller Share to be notified
forthwith in writing to the Mortgages Trustee, the Beneficiaries and the
Security Trustee.
(b) The Cash Manager will cause each determination of the Funding 1 Income
Deficit (if any), the Funding 1 Liquidity Shortfall (if any), the Funding
1 Available Principal Receipts and Funding 1 Available Revenue Receipts
to be notified forthwith in writing to Funding 1 and the Security
Trustee.
22
3. PRIORITY OF PAYMENTS FOR MORTGAGES TRUST AVAILABLE REVENUE RECEIPTS
The Cash Manager shall (unless the intended recipient of the relevant
payment agrees otherwise) on each Distribution Date withdraw Cash from
the Mortgages Trustee GIC Account and/or, in the case of sums to be
provided for, retain Cash in the amounts required (to the extent that
such withdrawal does not cause the Mortgages Trustee GIC Account to
become overdrawn or, if any amounts are retained by way of provision for
the relevant liability and are thus not withdrawn, to the extent that
withdrawal of those amounts that are withdrawn would not, if such
retained amounts were also to be withdrawn, cause the balance on the
Mortgages Trustee GIC Account to become overdrawn). The aggregate amount
of the withdrawal shall equal the Mortgages Trust Available Revenue
Receipts on each Distribution Date. The withdrawal shall be used to make
the payments and provisions in the order of priority set out in CLAUSE
10.2 of the Mortgages Trust Deed (in each case only if and to the extent
that payments or provisions of a higher priority have been made in full).
4. PRIORITY OF PAYMENTS FOR MORTGAGES TRUST AVAILABLE PRINCIPAL RECEIPTS
The Cash Manager shall (unless the intended recipient of the relevant
payment agrees otherwise) on each Distribution Date, withdraw Cash from
the Mortgages Trustee GIC Account (to the extent only that such
withdrawal does not cause the Mortgages Trustee GIC Account to become
overdrawn) in an aggregate amount equal to the Mortgages Trust Available
Principal Receipts on each Distribution Date to make the payments in the
order of priority set out in CLAUSE 11 of the Mortgages Trust Deed.
5. PRIORITY OF PAYMENTS FOR FUNDING 1 AVAILABLE REVENUE RECEIPTS
Funding 1 Available Revenue Receipts will be applied by the Cash Manager
on each Funding 1 Interest Payment Date until enforcement of the Funding
1 Security pursuant to the Funding 1 Deed of Charge or until such time as
there are no amounts outstanding under any Intercompany Loan Agreement,
in making such payments and provisions in the order of priority set out
in the Funding 1 Pre-Enforcement Revenue Priority of Payments (in each
case only if and to the extent that payments or provisions of a higher
priority have been made in full) as set out in Part 1 of Schedule 3 to
the Funding 1 Deed of Charge (as the same may be amended, varied or
restated from time to time).
6. PRIORITY OF PAYMENTS FOR FUNDING 1 AVAILABLE PRINCIPAL RECEIPTS
Funding 1 Available Principal Receipts will be applied by the Cash
Manager on each Funding 1 Interest Payment Date until enforcement of the
Funding 1 Security pursuant to the Funding 1 Deed of Charge or until such
time as there are no amounts outstanding under any Intercompany Loan
Agreement, in making such payments and provisions in the order of
priority (in each case only if and to the extent that payments or
provisions of a higher priority have been made in full) set out in Part 2
of Schedule 3 to the Funding 1 Deed of Charge.
7. FUNDING 1 INCOME DEFICIT/FUNDING 1 LIQUIDITY FACILITY
(a) If the Cash Manager determines four Business Days prior to a Funding 1
Interest Payment Date that there will be a Funding 1 Income Deficit, then
the Cash Manager, on behalf of Funding 1, shall pay or provide for such
Funding 1 Income Deficit by applying Funding 1 Principal Receipts (plus
any part of the balance of the Cash Accumulation Ledger which is not
comprised in Funding 1 Available Principal Receipts) to make good such
Funding 1 Income Deficit, and the Cash Manager shall make a corresponding
entry in the relevant Funding 1 Ledgers as described in paragraphs 11 and
16 below.
23
(b) If the Cash Manager determines there are no (or insufficient) amounts
standing to the credit of the Funding 1 Principal Ledger and/or the Cash
Accumulation Ledger to cure the Funding 1 Income Deficit then on the
London Business Day immediately preceding a Funding 1 Interest Payment
Date the Cash Manager will, subject to paragraph (c) below, (i) direct
Funding 1 to request a drawing pursuant to CLAUSE 5.1 of the Funding 1
Liquidity Facility Agreement to apply towards the deficit and/or (ii)
make a withdrawal from the Liquidity Reserve Fund (if established), as
applicable, to apply towards the deficit.
(c) A Funding 1 Liquidity Drawing may not be used to pay interest or
principal (as applicable) on the Term Advances if and to the extent that
there are funds available in the Liquidity Reserve Fund which are
available to cure such Funding 1 Income Deficit.
8. OTHER PAYMENTS
Each of the Beneficiaries and the Cash Manager agrees, and the Mortgages
Trustee concurs, that (save as otherwise specified below) the following
payments may be made from the Mortgages Trustee GIC Account (to the
extent that withdrawal of those amounts would not cause the balance of
the Mortgages Trustee GIC Account to become overdrawn) on any date:
(i) if any amount has been received from a Borrower for the express
purpose of payment being made to a third party for the provision
of a service (including giving insurance cover) to either that
Borrower or the Seller or the Mortgages Trustee, to pay such
amount when due to such third party or, in the case of the payment
of an insurance premium, where such third party and the Cash
Manager have agreed that payment of commission should be made by
deduction from such insurance premium, to pay such amount less
such commissions when due to such third party and to pay such
commission to the Cash Manager and to pay any premiums in respect
of any Insurance Policy or other insurance policy relating to any
Loan comprised in the Portfolio;
(ii) to pay to any person (including the Cash Manager) any amounts due
arising from any overpayment by any person or arising from any
reimbursement by any person of any such overpayment (including,
for the avoidance of doubt, where arising from the failure of a
direct debit);
(iii) to pay when due (but subject to any right to refuse or withhold
payment or of set-off that has arisen by reason of the Borrower's
breach of the terms of the relevant Mortgage or Loan) any amount
payable to a Borrower under the terms of the Mortgage or the Loan
to which that Borrower is a party, and to pay when due any amount
payable by the Mortgages Trustee to the Seller pursuant to CLAUSES
3.3, 4.4 and 5.2 of the Mortgage Sale Agreement;
(iv) to pay to the Seller any amounts (including, for the avoidance of
doubt, any Early Repayment Fees) received and held by the
Mortgages Trustee on trust for the Seller pursuant to CLAUSE 5 of
the Mortgage Sale Agreement;
(v) to pay when due and payable any amounts due and payable by the
Mortgages Trustee to third parties and incurred without breach by
the Mortgages Trustee of the Mortgages Trust Deed and not provided
for payment elsewhere in this paragraph ;
(vi) to refund any amounts due arising from the rejection of any
payments in respect of a Loan and any other amounts which have not
been received by the Mortgages Trustee as cleared funds; and
24
(vii) to refund to the Seller any amounts which represent amounts
received from Borrowers but which do not form part of the Mortgage
Account balance or comprise unpaid interest as at the relevant
date and which are amounts owed by such Borrowers in respect of
the period prior to the date on which the Mortgage Loan (together
with its Related Security) relating to such Mortgage Account was
transferred to the Mortgages Trustee as and when identified by the
Cash Manager and if a Borrower fails to pay the full amount that
it owes, the Cash Manager shall be obliged to refund to the Seller
only such portion of the amount which relates to any period prior
to such transfer.
9. USE OF LEDGERS
The Cash Manager shall forthwith record monies received or payments made
by it on behalf of the Mortgages Trustee or Funding 1 in the ledgers in
the manner set out in this Agreement. If, at any time, the Cash Manager
is in any doubt as to which ledger a particular amount should be credited
or debited, it shall consult with the Security Trustee thereon.
Except in the case of the Principal Deficiency Ledger, a debit item shall
only be made in respect of any of the Mortgages Trustee Ledgers and the
Funding 1 Ledgers and the corresponding payment or transfer (if any) may
only be made from the Mortgages Trustee GIC Account, the Funding 1 GIC
Account or the Funding 1 Transaction Account, as the case may be, to the
extent that such entry does not cause the relevant ledger to have a debit
balance. In the case of the Principal Deficiency Ledger and each
Principal Deficiency Sub Ledger, a credit item shall only be made to the
extent that such entry does not cause such ledger to have a credit
balance.
10. REVENUE LEDGER
The Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Revenue Ledger:
(i) all Revenue Receipts; and
(ii) all interest received by the Mortgages Trustee on the
Mortgages Trustee GIC Account; and
(b) any payment or provision made under paragraph shall be debited to
the Revenue Ledger.
11. PRINCIPAL LEDGER
The Cash Manager shall ensure that:
(a) all Principal Receipts shall be credited to the Principal Ledger;
and
(b) any payment or provision made under paragraph shall be debited to
the Principal Ledger.
12. LOSSES LEDGER
The Cash Manager shall ensure that all Losses shall be recorded in the
Losses Ledger.
25
13. FUNDING 1 SHARE/SELLER SHARE LEDGER
The Cash Manager shall ensure that the Current Funding 1 Share and the
Current Funding 1 Share Percentage of the Trust Property and the Current
Seller Share and the Current Seller Share Percentage of the Trust
Property are recorded in the Funding 1 Share/Seller Share Ledger on the
Initial Closing Date and thereafter on each Distribution Date.
14. FUNDING 1 REVENUE LEDGER
The Cash Manager shall ensure that:
(a) the following amounts shall be credited to the Funding 1 Revenue
Ledger:
(i) all Funding 1 Revenue Receipts;
(ii) all interest received by Funding 1 in respect of the Funding
1 Bank Accounts;
(iii) all amounts received by Funding 1 representing income on any
Funding 1 Authorised Investments;
(iv) all amounts (other than any early termination payment which
is to be used to acquire, if necessary, a new swap) received
by Funding 1 under the Funding 1 Swap Agreement; and
(v) any amount debited to the Funding 1 Principal Ledger under
paragraph 16(b)(ii) below; and
(b) any payment or provision made under paragraph 5 above shall be
debited to the Funding 1 Revenue Ledger.
15. FUNDING 1 LIQUIDITY FACILITY LEDGER
The Cash Manager shall ensure that:
(a) all Funding 1 Liquidity Facility Drawings shall be credited to the
Funding 1 Liquidity Facility Ledger; and
(b) all Funding 1 Liquidity Facility Repayments shall be noted on the
Funding 1 Liquidity Facility Ledger.
16. FUNDING 1 PRINCIPAL LEDGER
Without prejudice to paragraph 17 below, the Cash Manager shall ensure
that:
(a) the following amounts shall be credited to the Funding 1 Principal
Ledger:
(i) all Funding 1 Principal Receipts; and
(ii) amounts credited to the Principal Deficiency Ledger under
paragraph 5 above and paragraph 17 below; and
(b) the following amounts shall be debited to the Funding 1 Principal
Ledger:
(i) the aggregate amount of principal repaid on the Intercompany
Loan Agreement pursuant to paragraph 6 above; and
26
(ii) on each Funding 1 Interest Payment Date, an amount equal to
the Funding 1 Income Deficit on such Funding 1 Interest
Payment Date.
17. PRINCIPAL DEFICIENCY LEDGER
(a) Without prejudice to paragraph 5 above, the Cash Manager shall ensure
that there shall be debited to the Principal Deficiency Ledger:
(i) deficiencies arising from Losses which have been allocated to the
Funding 1 Share; and
(ii) any amount required to be debited to the Funding 1 Principal
Ledger under paragraph 16(b)(ii).
(b) The Cash Manager shall ensure that there shall be credited to the
Principal Deficiency Ledger any amount to be credited in accordance with
paragraph 5 above.
(c) Amounts to be debited to the Principal Deficiency Ledger shall be debited
in the following order:
(i) first, to the Principal Deficiency Sub Ledger corresponding to the
Term Advance with the lowest ranking Term Advance Rating until the
debit balance thereon is equal to the then principal amount
outstanding of the corresponding Term Advance(s); and
(ii) secondly, to the Principal Deficiency Sub Ledger corresponding to
the Term Advance with the next lowest Term Advance Rating until
the debit balance thereon is equal to the then principal amount
outstanding of corresponding Term Advance(s),
and so on until amounts are debited to the AAA Principal Deficiency Sub
Ledger, at which point there will be an Asset Trigger Event.
Losses on the Loans and/or the application of Funding 1 Available
Principal Receipts to pay interest on the Term Advances will not be
recorded on the Principal Deficiency Ledger to the extent that the
Funding 1 Share of the Trust Property together with amounts standing to
the credit of the Funding 1 Cash Accumulation Ledger and the Funding 1
Principal Ledger, in aggregate, is greater than or equal to the aggregate
Outstanding Principal Balance of the Intercompany Loans on the relevant
Funding 1 Interest Payment Date, after taking account of such Losses or
the relevant application of Principal Receipts.
(d) Amounts to be credited to a Principal Deficiency Ledger shall be credited
in the following order:
(i) first, to the Principal Deficiency Sub Ledger corresponding to the
Term Advance with the highest ranking Term Advance Rating until
the debit balance thereon is reduced to zero;
(ii) secondly, to the Principal Deficiency Sub Ledger corresponding to
the Term Advance with the next highest ranking Term Advance Rating
until the debit balance thereon is reduced to zero; and
(iii) thirdly, to the Principal Deficiency Sub Ledger corresponding to
the Term Advance with the next highest ranking Term Advance Rating
until the debit balance thereon is reduced to zero,
27
and so on until the balance of the Principal Deficiency Ledger is zero.
18. GENERAL RESERVE LEDGER
(a) A tranche (if any) drawn down on a relevant Closing Date by Funding 1
pursuant to a Start-Up Loan Agreement for the purposes of funding the
General Reserve Fund (or any other similar reserve fund) will be credited
to the General Reserve Ledger.
(b) Amounts shall be credited to the General Reserve Ledger in accordance
with the Funding 1 Priority of Payments above.
(c) Amounts shall be debited to the General Reserve Ledger on each Funding 1
Interest Payment Date in order to be applied in accordance with the order
of priority of payments set out in Schedule 3 to the Funding 1 Deed of
Charge.
19. LIQUIDITY RESERVE LEDGER
(a) Amounts shall be credited to the Liquidity Reserve Ledger in accordance
with the Funding 1 Priority of Payments above.
(b) Amounts shall be debited to the Liquidity Reserve Ledger to the extent
permitted on each relevant Funding 1 Interest Payment Date in order to
be applied in accordance with the priority of payments set out in
Schedule 3 to the Funding 1 Deed of Charge.
20. INTERCOMPANY LOAN LEDGER
The Cash Manager shall ensure that all payments of interest and
repayments of principal on each of the Term Advances are recorded in the
Intercompany Loan Ledger.
21. CASH ACCUMULATION LEDGER
The Cash Manager shall ensure that all Funding 1 Principal Receipts
reserved by Funding 1 to pay the relevant Bullet Term Advances are
recorded on the Cash Accumulation Ledger.
28
SCHEDULE 3
PART 1
FORM OF MORTGAGES TRUSTEE QUARTERLY REPORT
PERMANENT MORTGAGES TRUSTEE LIMITED
PROFIT & LOSS ACCOUNT
PERIOD ENDED THIS QUARTER PRIOR QUARTER
[GBP] [GBP]
Interest Receivable - Mortgages
---------- ----------
0 0
Interest Payable - Mortgages
---------- ----------
0 0
---------- ----------
Net Operating Income 0 0
---------- ----------
Fees Receivable
Fees Payable
Operating Expenses
---------- ----------
Profit/loss on ordinary activities before tax 0 0
Taxation
---------- ----------
Profit/loss on ordinary activities after tax 0 0
Dividend 0 0
Retained profit brought forward 0 0
---------- ----------
Retained profit for the year 0 0
---------- ----------
29
PERMANENT MORTGAGES TRUSTEE LIMITED [GBP] [GBP]
BALANCE SHEET
PERIOD ENDED
FIXED ASSET INVESTMENTS
CURRENT ASSETS
New Loans 0
Interest Receivable 0
Other Debtors 0
Cash at Bank 0
----------
0
----------
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Accruals 0
Interest Payable Accrual 0
Taxation 0
----------
0
----------
Net current assets 0
----------
Total Assets less current liabilities 0
----------
Share Capital 0
Reserves 0
----------
0
----------
Diff 0
30
PART 2
FORM OF FUNDING 1 QUARTERLY REPORT
PERMANENT FUNDING (NO. 1) LIMITED
PROFIT & LOSS ACCOUNT
PERIOD ENDED THIS QUARTER PRIOR QUARTER
[GBP] [GBP]
Interest Receivable - Mortgages
Interest Receivable - Cash Deposits
---------- ----------
0 0
Interest Payable - Intercompany Loan
Interest Payable
---------- ----------
0 0
---------- ----------
Net Operating Income 0 0
Other Income
Insurance Commission
Operating Expenses
Deferred Consideration
---------- ----------
Profit/loss on ordinary activities before tax 0 0
Taxation
---------- ----------
Profit/loss on ordinary activities after tax 0 0
Dividend 0 0
Retained profit brought forward 0 0
---------- ----------
Retained profit for the year 0 0
---------- ----------
31
PERMANENT FUNDING (NO. 1) LIMITED [GBP] [GBP]
BALANCE SHEET
PERIOD ENDED
FIXED ASSET INVESTMENTS
Beneficial Interest in Mortgage portfolio 0
CURRENT ASSETS
Interest Receivable 0
Deferred Expenditure (costs of Securing) 0
Other debtors 0
Cash at Bank
Reserve Funding 1
Transaction Account 0
Funding 1 GIC Account 0
----------
0
----------
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Accruals 0
Deferred Consideration Creditor 0
Interest Payable Accrual 0
Taxation 0
----------
0
----------
Net current assets 0
CREDITORS: AMOUNTS FALLING DUE AFTER ONE YEAR
Intercompany Loan 0
Start Up Loan 0
----------
Total Assets less current liabilities 0
----------
Share Capital 0
Reserves 0
0
----------
Diff 0
----------
32
PERMANENT FUNDING (NO. 1) LIMITED
NOTES TO BALANCE SHEET
PERIOD ENDED
BALANCE ON CASH ACCUMULATION LEDGER 0
AVAILABLE CREDIT ENHANCEMENT
General Reserve Fund at closing
Last Quarter Closing General Reserve Fund
Drawings to make a bullet repayment
Other drawings
Closing General Reserve Fund Balance
Target General Reserve Fund Balance
PRINCIPAL DEFICIENCY LEDGER AAA AA BBB
Opening PDL Balance 0 0 0
Losses this Quarter 0 0 0
PDL top up from Revenue Income 0 0 0
Closing PDL Balance 0 0 0
SUBORDINATED LOAN OUTSTANDING
Initial Balance
Last Quarter Closing Outstanding
Accrued Interest
Repayments Made
Closing Balance
33
SIGNATORIES
Signed by )
for and on behalf of )
HALIFAX PLC )
as Cash Manager )
Signed by )
for and on behalf of )
HALIFAX PLC )
as Seller )
Signed by )
for and on behalf of )
PERMANENT MORTGAGES TRUSTEE )
LIMITED )
Signed by )
for and on behalf of )
PERMANENT FUNDING (NO. 1) LIMITED )
Signed by )
for and on behalf of )
BANK OF NEW YORK )
34