DRAFT: 14.07.04 EXHIBIT 4.12
FIFTH ISSUER BANK ACCOUNT AGREEMENT
DATED [22ND JULY], 2004
PERMANENT FINANCING (NO. 5) PLC
AS FIFTH ISSUER
AND
HALIFAX PLC
AS FIFTH ISSUER CASH MANAGER
AND
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
AS FIFTH ISSUER ACCOUNT BANK
AND
THE BANK OF NEW YORK
AS SECURITY TRUSTEE
XXXXX & XXXXX
XXXXX & XXXXX LLP
LONDON
CONTENTS
CLAUSE PAGE
1. Definitions and Interpretation......................................... 1
2. The Fifth Issuer Transaction Account................................... 1
3. Additional Fifth Issuer Accounts....................................... 2
4. Payments............................................................... 3
5. Mandates and Statements................................................ 4
6. Acknowledgement by the Fifth Issuer Account Bank....................... 4
7. Certification, Indemnity and Acceleration Notice....................... 6
8. Change of Security Trustee or Fifth Issuer Account Bank................ 6
9. Termination............................................................ 7
10. Further Assurance..................................................... 10
11. Confidentiality....................................................... 10
12. Costs................................................................. 10
13. Notices............................................................... 10
14. Interest.............................................................. 11
15. Withholding........................................................... 11
16. Tax Status.............................................................12
17. Entire Agreement...................................................... 12
18. Variation and Waiver.................................................. 12
19. Assignment............................................................ 12
20. The Security Trustee.................................................. 13
21. Exclusion of Third Party Rights....................................... 13
22. Counterparts.......................................................... 13
23. Governing Law......................................................... 13
24. Submission to Jurisdiction............................................ 13
SCHEDULE
1. Form of Fifth Issuer Transaction Account Mandate...................... 14
2. Form of Notice of Assignment and Acknowledgement of Assignment........ 15
Part 1 Notice of Assignment - Fifth Issuer Accounts................... 15
Part 2 Acknowledgement - Fifth Issuer Accounts........................ 17
Signatories................................................................. 18
THIS FIFTH ISSUER BANK ACCOUNT AGREEMENT is made on [{circle}], 2004
BETWEEN:
(1) PERMANENT FINANCING (NO. 5) PLC (registered number 5114399), a public
limited company incorporated under the laws of England and Wales, whose
registered office is at Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX
(the FIFTH ISSUER);
(2) 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 in its capacity as
Fifth Issuer Cash Manager;
(3) THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND, a company established
by an Act of Parliament of Scotland in 1695 and having its head office at
Xxx Xxxxx, Xxxxxxxxx XX0 0XX, acting in its capacity as fifth issuer non-
sterling account bank (the FIFTH ISSUER NON-STERLING ACCOUNT BANK) and
acting in its capacity as fifth issuer account bank from the branch
located at (in the case of the Fifth Issuer Transaction Account) 000
Xxxxxxxxxx Xxxxxx, Xxxxx XX0 0XX (the FIFTH ISSUER STERLING ACCOUNT BANK
and the Fifth Issuer Sterling Account Bank and the Fifth Issuer Non-
Sterling Account Bank, together referred to as, the FIFTH ISSUER ACCOUNT
BANK); and
(4) THE BANK OF NEW YORK, a New York banking corporation whose London branch
address is at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX, in its
capacity as Security Trustee.
IT IS HEREBY AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
The amended and restated master definitions and construction schedule
signed by, amongst others, the parties to this Agreement 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) and the fifth issuer master
definitions and construction schedule, signed for the purposes of
identification by Xxxxx & Xxxxx and Xxxxxx Xxxxxx Xxxxx & Xxxx on
[{circle}], 2004 (as the same may be amended, varied or supplemented from
time to time) (the FIFTH ISSUER MASTER DEFINITIONS AND CONSTRUCTION
SCHEDULE) are expressly and specifically incorporated into this Agreement
and, accordingly, the expressions defined in the Master Definitions and
Construction Schedule and the Fifth Issuer 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 and the Fifth Issuer Master
Definitions and Construction Schedule.
2. THE FIFTH ISSUER TRANSACTION ACCOUNT
2.1 INSTRUCTIONS FROM FIFTH ISSUER CASH MANAGER TO FIFTH ISSUER ACCOUNT BANK
Subject to CLAUSE 7.3, the Fifth Issuer Account Bank shall comply with
any direction of the Fifth Issuer Cash Manager to effect a payment by
debiting the Fifth Issuer Transaction Account if such direction (a) is in
writing, is given by telephone and confirmed in writing not later than
close of business on the day on which such direction is given, or is
given by the
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internet banking service provided by the Fifth Issuer Account Bank
and/or otherwise (b) complies with the Fifth Issuer Transaction
Account Mandate.
2.2 TIMING OF PAYMENT
Without prejudice to the provisions of CLAUSE 4.2, the Fifth Issuer
Account Bank agrees that if directed pursuant to CLAUSE 2.1 to make
any payment then, subject to CLAUSES 2.4 and 7.3 below, it will do so
prior to close of business on the London Business Day on which such
direction is received and for value that day provided that, if any
direction is received later than 12.00 p.m. (London time) on any
London Business Day, the Fifth Issuer Account Bank shall make such
payment at the commencement of business on the following London
Business Day for value that day.
2.3 FIFTH ISSUER TRANSACTION ACCOUNT CHARGES
The charges of the Fifth Issuer Account Bank for the operation of the
Fifth Issuer Transaction Account shall be debited to the Fifth Issuer
Transaction Account only on the first day of each month (or, if such day
is not a London Business Day, the next succeeding London Business Day) in
accordance with the order of priority set out in the Fifth Issuer Cash
Management Agreement, or, following the service of a Fifth Issuer Note
Acceleration Notice (that is not withdrawn), the Fifth Issuer Deed of
Charge, and the Fifth Issuer by its execution hereof irrevocably agrees
that this shall be done. The charges shall be payable at the same rates
as are generally applicable to the business customers of the Fifth Issuer
Account Bank.
2.4 NO OVERDRAWN BALANCE
Notwithstanding the provisions of CLAUSE 2.1, amounts shall only be
withdrawn from the Fifth Issuer Transaction Account to the extent that
such withdrawal does not cause the Fifth Issuer Transaction Account to
become overdrawn.
3. ADDITIONAL FIFTH ISSUER ACCOUNTS
3.1 TERMINATION OF FIFTH ISSUER SWAPS
If any or all of the Fifth Issuer Swap Agreements terminate and the Fifth
Issuer is unable to enter into replacement hedging arrangements, the
Fifth Issuer shall instruct the Fifth Issuer Cash Manager to open, as
necessary, the relevant Additional Fifth Issuer Account at the Fifth
Issuer Account Bank. The Fifth Issuer shall deliver a mandate to the
Fifth Issuer Account Bank relating to such Additional Fifth Issuer
Account in accordance with this Agreement and the Fifth Issuer Deed of
Charge.
3.2 OPERATION OF ADDITIONAL FIFTH ISSUER ACCOUNTS
In the event that an Additional Fifth Issuer Account is created pursuant
to CLAUSE 3.1, the relevant account shall be operated in accordance with
the following provisions:
(a) subject to CLAUSE 7.3, the Fifth Issuer Account Bank shall comply
with any direction of the Fifth Issuer Cash Manager to effect a
payment by debiting the relevant Additional Fifth Issuer Account
if such direction (i) is in writing or is given by telephone and
confirmed in writing not later than close of business on the day
on which such direction is given or is given by the internet
banking service provided by the Fifth Issuer Account Bank, and/or
otherwise (ii) complies with the mandates of such Additional Fifth
Issuer Account;
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(b) the Fifth Issuer Account Bank shall be entitled to rely on any
direction given by telephone which, in its opinion (acting
reasonably and in good faith), purports to be given by any
Authorised Signatory referred to in the mandates of the relevant
Additional Fifth Issuer Account, from time to time and in respect
of which the person giving the direction quotes a code reference
notified in writing by the Fifth Issuer Cash Manager from time to
time to the Fifth Issuer Account Bank and no delay in giving (or
the absence of giving) the written confirmation of any such
direction shall affect the validity of, or time of giving, the
relevant telephone direction;
(c) without prejudice to the provisions of CLAUSE 4.2, the Fifth
Issuer Account Bank agrees that if directed pursuant to CLAUSE
3.2(a)to make any payment then, subject to CLAUSES 3.2(e) and 7.3
below, it will do so prior to close of business on the London
Business Day on which such direction is received and for value
that day provided that, if any direction is received later than
3.15 p.m. (London time) (or, in the case of a payment to an
account held by a member bank of the Association for Payment
Clearing Services (APACS) within the town clearing area, 3.45
p.m. (London time) or, in the case of a payment to another
account with the Fifth Issuer Account Bank at the same branch,
4.00 p.m. (London time)) on any London Business Day, the Fifth
Issuer Account Bank shall make such payment at the commencement
of business on the following London Business Day for value that
day;
(d) the charges of the Fifth Issuer Account Bank for the operation of
the Additional Fifth Issuer Accounts (if established) shall be
debited to the relevant Additional Fifth Issuer Account on each
Interest Payment Date in accordance with the order of priority
set out in the Fifth Issuer Cash Management Agreement or
following enforcement of the Fifth Issuer Security, the Fifth
Issuer Deed of Charge, and the Fifth Issuer by its execution
hereof irrevocably agrees that this shall be done. The charges
shall be payable at the same rates as are generally applicable to
the business customers of the Fifth Issuer Account Bank; and
(e) notwithstanding the provisions of CLAUSE 3.2(a), and subject to
the Fifth Issuer Deed of Charge, amounts shall only be withdrawn
from an Additional Fifth Issuer Account to the extent that such
withdrawals do not cause that Additional Fifth Issuer Account to
become overdrawn.
4. PAYMENTS
4.1 INSTRUCTIONS FROM THE FIFTH ISSUER CASH MANAGER
(a) The Fifth Issuer Cash Manager shall, no later than 11.00 a.m.
(London time) on the fourth London Business Day before the date
upon which any payment is due to be made from a Fifth Issuer
Account (including the payments due to be made on each Interest
Payment Date), submit to the Fifth Issuer Account Bank irrevocable
written instructions, or instructions by way of the internet
banking service provided by the Fifth Issuer Account Bank as to
the payments to be made out of the relevant accounts on such date.
(b) The Fifth Issuer Account Bank shall comply with the instructions
described in CLAUSE 4.1(a) and shall effect the payments
specified in such instructions not later than the time specified
for payment therein (provided that the Fifth Issuer Account Bank
shall not have any liability to any person if it fails to effect
timely payment by reason of strike, computer failure, power cut
or other matters beyond its control) on the relevant date if the
instructions comply with the relevant Fifth Issuer Account
Mandate.
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4.2 TIMING OF PAYMENT
The Fifth Issuer Account Bank agrees that it will, not later than
11.00 a.m. (London time) on the second London Business Day prior to each
Interest Payment Date, confirm to the Fifth Issuer Cash Manager (provided
that such is the case) that it has received irrevocable instructions to
effect payment to the Principal Paying Agent on the relevant Interest
Payment Date and specifying the amount of the payment to be made and
that, subject to receipt of funds, it will effect such payment.
5. MANDATES AND STATEMENTS
5.1 SIGNING AND DELIVERY OF MANDATES
The Fifth Issuer has delivered to the Fifth Issuer Account Bank prior
to the Fifth Issuer Closing Date the Fifth Issuer Transaction Account
Mandate in or substantially in the form set out in SCHEDULE 1 hereto
duly executed and relating to the Fifth Issuer Transaction Account,
and the Fifth Issuer Account Bank hereby confirms to the Security
Trustee that the Fifth Issuer Transaction Account Mandate has been
provided to it, that the Fifth Issuer Transaction Account is open and
that the Fifth Issuer Transaction Account Mandate is operative. The
Fifth Issuer agrees that, if an additional account is opened pursuant
to CLAUSE 3.1 (above), it will deliver to the Fifth Issuer Account
Bank a duly executed mandate relating to such Additional Fifth Issuer
Account. The Fifth Issuer Account Bank acknowledges that the Fifth
Issuer Transaction Account Mandate and any other mandates delivered
from time to time pursuant hereto shall be subject to the terms of the
Fifth Issuer Deed of Charge and this Agreement.
5.2 AMENDMENT OR REVOCATION
The Fifth Issuer Account Bank agrees that it shall notify the Security
Trustee as soon as is reasonably practicable and in accordance with
CLAUSE 13 if it receives any amendment to or revocation of any Fifth
Issuer Account Mandate that it holds (other than a change of Authorised
Signatory) and shall require the prior written consent of the Security
Trustee to any such amendment or revocation (other than a change of
Authorised Signatory) but, unless a Fifth Issuer Account Mandate is
revoked, the Fifth Issuer Account Bank may continue to comply with that
amended Fifth Issuer Account Mandate (as it may from time to time be
amended in accordance with the provisions of this CLAUSE 5.2) unless it
receives notice in writing from the Security Trustee to the effect that a
Fifth Issuer Note Acceleration Notice has been served or that the
appointment of Halifax plc as Fifth Issuer Cash Manager under the Fifth
Issuer Cash Management Agreement has been terminated and shall,
thereafter, act solely on the instructions of the Security Trustee and in
accordance with the terms thereof as provided in CLAUSE 7.3 of this
Agreement.
6. ACKNOWLEDGEMENT BY THE FIFTH ISSUER ACCOUNT BANK
6.1 RESTRICTION ON FIFTH ISSUER ACCOUNT BANK'S RIGHTS
Notwithstanding anything to the contrary in any Fifth Issuer Account
Mandate, the Fifth Issuer Account Bank hereby:
(a) waives any right it has or may hereafter acquire to combine,
consolidate or merge any Fifth Issuer Account with any other
account of the Fifth Issuer Cash Manager, the Fifth Issuer, the
Mortgages Trustee, Funding 1, the Seller, the Security Trustee or
any other person or any liabilities of the Fifth Issuer Cash
Manager, the Fifth Issuer, the
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Mortgages Trustee, Funding 1, the Seller, the Security Trustee or
any other person owing to it;
(b) agrees that it may not exercise any lien, or, to the extent
permitted by law, any set-off or transfer any sum standing to the
credit of or to be credited to any Fifth Issuer Account in or
towards satisfaction of any liabilities of the Fifth Issuer Cash
Manager, the Fifth Issuer, the Mortgages Trustee, Funding 1, the
Seller, the Security Trustee or any other person owing to it;
(c) in addition to and without prejudice to its rights and obligations
as a Fifth Issuer Secured Creditor, agrees that it will not take,
and shall not take, any steps whatsoever to recover any amount due
or owing to it pursuant to this Agreement or any other debts
whatsoever owing to it by the Fifth Issuer, or procure the
winding-up or liquidation of the Fifth Issuer or the making of an
administration order in relation to the Fifth Issuer or the filing
of documents with the court in relation to the Fifth Issuer or the
service of a notice of intention to appoint an administrator in
relation to the Fifth Issuer in respect of any of the liabilities
of the Fifth Issuer whatsoever other than to the extent expressly
permitted under the Fifth Issuer Deed of Charge;
(d) agrees that it shall have recourse only to sums paid to or
received by (or on behalf of) the Fifth Issuer pursuant to the
Transaction Documents subject always to and in accordance with the
order of priority set out in the Fifth Issuer Deed of Charge;
(e) agrees that it will notify, in accordance with CLAUSE 13, the
Fifth Issuer Cash Manager, the Fifth Issuer and the Security
Trustee if compliance with any instruction would cause any Fifth
Issuer Account to have a negative balance, such notification to
be given on the same London Business Day that it determines that
compliance with such instruction would cause any such account to
have a negative balance; and
(f) acknowledges that the Fifth Issuer has, pursuant to the Fifth
Issuer Deed of Charge, inter alia, assigned by way of security all
its rights, title, interest and benefit, present and future, in
and to, all sums from time to time standing to the credit of the
Fifth Issuer Accounts and all of its rights under this Agreement
to the Security Trustee.
6.2 NOTICE OF ASSIGNMENT AND ACKNOWLEDGEMENT
The Fifth Issuer Account Bank agrees that promptly upon receipt of a
notice of assignment signed by the Fifth Issuer, in (or substantially in)
the form of notice set out in PART 1 of SCHEDULE 2 hereto, the Fifth
Issuer Account Bank shall sign and duly return to the Fifth Issuer, with a
copy to the Security Trustee, an acknowledgement in (or substantially in)
the form of acknowledgement set out in PART 2 of SCHEDULE 2.
6.3 MONTHLY STATEMENT
Unless and until directed otherwise by the Security Trustee in accordance
with CLAUSE 13, the Fifth Issuer Account Bank shall provide each of the
Fifth Issuer Cash Manager, the Fifth Issuer and the Security Trustee with
a written statement setting out the amounts standing to the credit of the
Fifth Issuer Accounts at the close of business on the London Business Day
immediately preceding the relevant statement date and/or such other
relevant date set out in a statement request (i) on a monthly basis and,
in any event, within three London Business Days of the relevant statement
date and (ii) as soon as reasonably practicable after receipt of a
request for a statement. The Fifth Issuer Account Bank is hereby
authorised by the Fifth Issuer to provide statements in respect of the
Fifth Issuer Accounts, to the Fifth Issuer Cash Manager and the Security
Trustee.
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7. CERTIFICATION, INDEMNITY AND ACCELERATION NOTICE
7.1 FIFTH ISSUER ACCOUNT BANK TO COMPLY WITH FIFTH ISSUER CASH MANAGER'S
INSTRUCTIONS
Unless otherwise directed in writing by the Security Trustee pursuant
to CLAUSE 7.3, in making any transfer or payment from the Fifth Issuer
Accounts in accordance with this Agreement, the Fifth Issuer Account
Bank shall be entitled to act as directed by the Fifth Issuer Cash
Manager pursuant to CLAUSES 2.1 and 4.1 or pursuant to CLAUSES 3.1 and
4.2, as the case may be, and to rely as to the amount of any such
transfer or payment on the Fifth Issuer Cash Manager's instructions in
accordance with the relevant Fifth Issuer Account Mandate, and the
Fifth Issuer Account Bank shall have no liability to the Fifth Issuer
Cash Manager, the Fifth Issuer or the Security Trustee for having
acted on such instructions except in the case of its wilful default,
fraud or negligence.
7.2 FIFTH ISSUER'S INDEMNITY
Subject to the priority of payments set out in the Fifth Issuer Cash
Management Agreement or the Fifth Issuer Deed of Charge, as the case may
be, the Fifth Issuer shall indemnify the Fifth Issuer Account Bank or,
pursuant to CLAUSE 7.3, the Security Trustee, as the case may be, to the
extent of funds then standing to the credit of the relevant Fifth Issuer
Account against any loss, cost, damage, charge or expense incurred by the
Fifth Issuer Account Bank and/or the Security Trustee, as the case may
be, in complying with any instruction delivered pursuant to and in
accordance with this Agreement, save that this indemnity shall not extend
to:
(a) the charges of the Fifth Issuer Account Bank (if any) for the
operation of the Fifth Issuer Accounts other than as provided in
this Agreement; and
(b) any loss, cost, damage, charge or expense arising from any breach
by the Fifth Issuer Account Bank of its obligations under this
Agreement.
7.3 CONSEQUENCES OF A FIFTH ISSUER INTERCOMPANY LOAN ACCELERATION NOTICE OR A
FIFTH ISSUER NOTE ACCELERATION NOTICE
The Fifth Issuer Account Bank acknowledges that, if it receives notice
in writing from the Security Trustee to the effect that (a) the
Security Trustee has served (i) a Fifth Issuer Intercompany Loan
Acceleration Notice, or (ii) a Fifth Issuer Note Acceleration Notice,
or (b) that the appointment of Halifax plc as Fifth Issuer Cash
Manager under the Fifth Issuer Cash Management Agreement has been
terminated (but without prejudice to CLAUSE 7.1 above) all right,
authority and power of the Fifth Issuer Cash Manager in respect of the
Fifth Issuer Accounts shall be terminated and be of no further effect
and the Fifth Issuer Account Bank agrees that it shall, upon receipt
of such notice from the Security Trustee, comply with the directions
of the Security Trustee or any successor cash manager appointed by the
Security Trustee (subject to such successor cash manager having
entered into an agreement with the Fifth Issuer Account Bank on
substantially the same terms as this Agreement) in relation to the
operation of the Fifth Issuer Accounts.
8. CHANGE OF SECURITY TRUSTEE OR FIFTH ISSUER ACCOUNT BANK
8.1 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 provisions of the Fifth Issuer Deed of Charge, the existing Security
Trustee, the new Security Trustee or the retiring Security Trustee, as
the case may be, the Fifth Issuer Cash Manager, the Fifth Issuer and the
Fifth
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Issuer Account Bank shall execute such documents and take such
actions as such of the new Security Trustee and the retiring Security
Trustee or, as the case may be, the existing Security Trustee shall agree
are reasonably necessary for the purpose of vesting in such new Security
Trustee the rights, benefits and obligations of the Security Trustee
under this Agreement and releasing the retiring Security Trustee from its
future obligations hereunder.
8.2 CHANGE OF FIFTH ISSUER ACCOUNT BANK
If there is any change in the identity of the Fifth Issuer Account Bank,
then the Fifth Issuer Cash Manager, the Fifth Issuer, the Security
Trustee and any other existing Fifth Issuer Account Bank shall execute
such documents and take such actions as the new Fifth Issuer Account Bank
and the outgoing retiring Fifth Issuer Account Bank and the Security
Trustee may require for the purpose of vesting in the new Fifth Issuer
Account Bank the rights and obligations of the outgoing Fifth Issuer
Account Bank and releasing the outgoing Fifth Issuer Account Bank from
its future obligations under this Agreement.
9. TERMINATION
9.1 TERMINATION EVENTS
The Fifth Issuer Cash Manager or the Fifth Issuer:
(a) shall (with the prior written consent of the Security Trustee)
terminate this Agreement and close the Fifth Issuer Accounts, in
the event any of the matters specified in paragraphs (ii) to (v)
below occur; and
(b) may (with the prior written consent of the Security Trustee)
terminate this Agreement and close the Fifth Issuer Accounts, in
the event any of the matters specified in paragraphs (i) and (vi)
below occur,
in each case, by serving a written notice of termination on the Fifth
Issuer Account Bank in the following circumstances
(i) if a deduction or withholding for or on account of any Tax
is imposed, or it appears likely that such a deduction or
withholding will be imposed, in respect of the interest
payable on any of the Fifth Issuer Accounts held with it; or
(ii) the short-term, unsecured, unsubordinated and unguaranteed
debt obligations of the Fifth Issuer Account Bank cease to
have a rating of at least P-1 from Xxxxx'x, A-1+ from S&P or
F1+ from Fitch, as the case may be; or
(iii) if the Fifth Issuer Account Bank, otherwise than for the
purposes of such amalgamation or reconstruction as is
referred to in paragraph (d) below, ceases or, through an
authorised action of the board of directors of the Fifth
Issuer Account Bank, threatens to cease to carry on all or
substantially all of its business or is deemed unable to pay
its debts as and when they fall due within the meaning of
section 123(1)(a) of the Insolvency Xxx 0000 (on the basis
that the reference in such section to {pound-sterling}750
was read as a reference to {pound-sterling}10 million),
sections 123(1)(b), (c), (d) and (e) (on the basis that the
words "for a sum exceeding {pound-sterling}10 million" were
inserted after the words "extract registered bond" and
"extract registered protest" and section 123(2) of the
Insolvency Xxx 0000 (as that Section may be amended) or
ceases to be an authorised institution under the Financial
Services and Markets Xxx 0000; or
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(iv) if an order is made or an effective resolution is passed for
the winding-up of the Fifth Issuer Account Bank except a
winding-up for the purposes of or pursuant to a solvent
amalgamation or reconstruction the terms of which have
previously been approved in writing by the Security Trustee
(such approval not to be unreasonably withheld or delayed);
or
(v) if proceedings are initiated against the Fifth Issuer
Account Bank under any applicable liquidation, insolvency,
bankruptcy, composition, reorganisation (other than a
reorganisation where the Fifth Issuer Account Bank is
solvent) or other similar laws (including, but not limited
to, presentation of a petition for an administration order,
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) and (except in the case of
presentation of petition for an administration order, 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) such proceedings are not, in the
reasonable opinion of the Security Trustee, being disputed
in good faith with a reasonable prospect of success or an
administration order is granted or the appointment of an
administrator takes effect or an administrative receiver or
other receiver, liquidator, trustee in sequestration or
other similar official is appointed in relation to the Fifth
Issuer Account Bank or in relation to the whole or any
substantial part of the undertaking or assets of the Fifth
Issuer Account Bank, or an encumbrancer takes possession of
the whole or any substantial part of the undertaking or
assets of the Fifth Issuer Account Bank, or a distress,
execution or diligence or other process shall be levied or
enforced upon or sued out against the whole or any
substantial part of the undertaking or assets of the Fifth
Issuer Account Bank and such possession or process (as the
case may be) is not discharged or otherwise ceases to apply
within 30 days of its commencement, or the Fifth Issuer
Account Bank initiates or consents to judicial proceedings
relating to itself under applicable liquidation, insolvency,
bankruptcy, composition, reorganisation or other similar
laws or makes a conveyance or assignment or assignation for
the benefit of its creditors generally or takes steps with a
view to obtaining a moratorium in respect of any of
indebtedness; or
(vi) if the Fifth Issuer Account Bank fails to perform any of its
obligations under this Agreement and such failure remains
unremedied for three London Business Days after the Fifth
Issuer Cash Manager or the Security Trustee, as the case may
be, has given notice of such failure.
9.2 TERMINATION OPTION
The Fifth Issuer and the Security Trustee, upon a breach by the Fifth
Issuer Account Bank of its obligations under this Agreement, may, by
giving one month's prior written notice to the Fifth Issuer Account Bank
(with a copy to the Security Trustee), terminate the appointment of the
Fifth Issuer Account Bank, provided that:
(a) such termination shall not be effective until a replacement
financial institution or institutions (in each case (i) with a
short-term unsecured, unsubordinated and unguaranteed debt
obligation rating of at least P-1 (in the case of Moody's) and A-
1+ (in the case of S&P) and F1+ (in the case of Fitch) and (ii)
being an authorised institution under the Financial Services and
Markets Act 2000) shall have entered into an agreement in form and
substance similar to this Agreement; and
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(b) such termination would not adversely affect the then current
ratings of the Fifth Issuer Notes.
The Fifth Issuer Cash Manager and the Fifth Issuer shall use reasonable
endeavours to agree such terms with such a replacement financial
institution or institutions within 60 days of the date of the notice. In
the event of such termination the Fifth Issuer Account Bank shall assist
the other parties hereto to effect an orderly transition of the banking
arrangements documented hereby and the Fifth Issuer shall reimburse the
Fifth Issuer Account Bank for its reasonable costs and any amounts in
respect of Irrecoverable VAT thereon (including reasonable costs and
expenses) incurred during the period of, and until completion of, such
transition.
9.3 NOTIFICATION OF TERMINATION EVENT
Each of the Fifth Issuer, the Fifth Issuer Cash Manager and the Fifth
Issuer Account Bank undertakes and agrees to notify the Security Trustee
in accordance with CLAUSE 13 promptly upon becoming aware thereof of any
event which would or could entitle the Security Trustee to serve a notice
of termination pursuant to CLAUSES 9.2 TO 9.4 (inclusive).
9.4 TERMINATION BY SECURITY TRUSTEE
In addition, prior to the service of a Fifth Issuer Intercompany Loan
Acceleration Notice or a Fifth Issuer Note Acceleration Notice, the
Security Trustee may terminate this Agreement and close the Fifth
Issuer Accounts by serving a notice of termination if any of the
events specified in CLAUSE 9.1(b)(i) to (vi) (inclusive) of this
Agreement occurs in relation to the Fifth Issuer Account Bank.
Following the service of a Fifth Issuer Intercompany Loan Acceleration
Notice or a Fifth Issuer Note Acceleration Notice, the Security
Trustee may serve a notice of termination at any time.
9.5 AUTOMATIC TERMINATION
This Agreement shall automatically terminate (if not terminated earlier
pursuant to this CLAUSE 9) on the date falling 90 days after all Fifth
Issuer Secured Obligations have been irrevocably discharged in full.
9.6 TERMINATION BY FIFTH ISSUER ACCOUNT BANK
The Fifth Issuer Account Bank may terminate this Agreement and cease to
operate the Fifth Issuer Accounts at any time:
(a) on giving not less than six months' prior written notice thereof
ending on any London Business Day which does not fall on either an
Interest Payment Date or less than 10 London Business Days before
an Interest Payment Date to each of the other parties hereto
without assigning any reason therefor; and
(b) on giving not less than three months' prior written notice thereof
ending on any London Business Day which does not fall on either an
Interest Payment Date or less than 10 London Business Days before
an Interest Payment Date to each of the other parties hereto, if
the Fifth Issuer Account Bank shall have demanded payment of its
due charges or any interest and the same shall have remained
unpaid for a period of one month, provided that if the relevant
amounts have been paid on or before the date six weeks after the
date of delivery of such notice the notice shall have no effect,
9
Provided that such termination shall not take effect:
(i) until a replacement financial institution or institutions (in
each case, (A) with a short-term unsecured, unsubordinated and
unguaranteed debt obligation rating of at least P-1 (in the case
of Moody's) and A-1+ (in the case of S&P) and F1+ (in the case
of Fitch) and (B) being an authorised institution under the
Financial Services and Markets Act 2000) shall have entered into
an agreement in form and substance similar to this Agreement;
and
(ii) if the then current ratings of the Fifth Issuer Notes would be
adversely affected thereby.
In either case the Fifth Issuer Account Bank shall not be responsible for
any costs or expenses occasioned by such termination and cessation. In
the event of such termination and cessation the Fifth Issuer Account Bank
shall assist the other parties hereto to effect an orderly transition of
the banking arrangements documented hereby.
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 as may be
necessary or reasonably desirable to give full effect to the arrangements
contemplated by this Agreement.
11. CONFIDENTIALITY
None of the parties hereto shall during the term of this Agreement or
after its termination disclose to any person whatsoever (except as
provided herein or in any of the Transaction Documents to which it is a
party or with the authority of the other parties hereto or so far as may
be necessary for the proper performance of its obligations hereunder or
unless required by law or any applicable stock exchange requirement or
any governmental or regulatory authority or ordered to do so by a court
of competent jurisdiction or by the Inland Revenue or the Commissioners
of Customs and Excise or the Bank of England or the Financial Services
Authority) any information relating to the business, finances or other
matters of a confidential nature of any other party hereto of which it
may in the course of its duties hereunder have become possessed and each
of the parties hereto shall use all reasonable endeavours to prevent any
such disclosure.
12. COSTS
The Fifth Issuer agrees to pay the reasonable costs and any amounts in
respect of Irrecoverable VAT thereon (including reasonable legal costs
and expenses) of the Fifth Issuer Account in connection with the
negotiation of this Agreement and the establishment of the Fifth
Issuer Accounts respectively and the negotiation and execution of any
further documents and the taking of any further action to be executed
or taken pursuant to CLAUSES 8, 9 (other than CLAUSES 9.1(b)(ii),
9.1(b)(iii), 9.1(b)(iv), 9.1(b)(v), 9.1(b)(vi) 9.5 and 9.6(a)) and 10.
13. 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 5.00 p.m. (London time)
on a London Business Day or on the next London Business Day if delivered
thereafter or on a day
10
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 Fifth Issuer Cash Manager, to Halifax plc,
Xxxxxxx Xxxx (XX/0/0/XXX), Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX
(facsimile number x00 (0) 000 000 0000) for the attention of the
Head of Mortgage Securitisation with a copy to HBOS Treasury
Services plc, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX (facsimile
number x00 (000) 0000 0000) for the attention of Head of Capital
Markets and Securitisation;
(b) in the case of the Fifth Issuer, to Permanent Financing (No. 5)
PLC, Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxx, Xxxxxx XX0X 0XX (facsimile
number x00 (000) 0000 0000) for the attention of the Directors
with a copy to HBOS Treasury Services plc, 00 Xxx Xxxxx Xxxxxx,
Xxxxxx XX0X 0XX (facsimile number x00 (000) 0000 0000) for the
attention of Head of Capital Markets and Securitisation;
(c) in the case of the Security Trustee, to The Bank of New York, 00xx
Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX, (facsimile number +44
(000) 0000 0000) for the attention of Global Structured Finance -
Corporate Trust; and
(d) in the case of the Fifth Issuer Account Bank, the Bank of
Scotland, Leeds Business Centre, 000 Xxxxxxxxxx Xxxxxx, Xxxxx, XX0
0XX (facsimile number x00 (0) 0000 000000) for the attention of
the Associate Director with copies to: Bank of Scotland, c/o
Halifax plc, Bradford Business Centre, 00 Xxxx Xxxxxx, Xxxxxxxx
XX0 0XX (facsimile number x00 (0) 0000 000000 for the attention of
the Associate Director; Halifax plc, Xxxxxxx Xxxx (XX/0/0/XXX),
Xxxxxxx, Xxxx Xxxxxxxxx XX0 0XX (facsimile number +44 (0) 113 235
7511) for the attention of the Head of Mortgage Securitisation;
and HBOS Treasury Services plc, 00 Xxx Xxxxx Xxxxxx, Xxxxxx XX0X
0XX (facsimile number x00 (000) 0000 0000) for the attention of
Head of Capital Markets and Securitisation.
14. INTEREST
14.1 The Fifth Issuer Account Bank shall pay, on the first day of each month
(or if such day is not a London Business Day on the next succeeding
London Business Day) in respect of the preceding month, interest on any
cleared credit balances on the Fifth Issuer Transaction Account at a rate
of Sterling-LIBOR for three month sterling deposits in respect of such
period less 0.25 per cent. per annum.
14.2 Any Additional Fifth Issuer Account opened with the Fifth Issuer Account
Bank or any other bank shall be an interest bearing account.
15. WITHHOLDING
All payments by the Fifth Issuer Account Bank under this Agreement shall
be made in full without any deduction or withholding (whether in respect
of set-off, counterclaim, duties, Taxes, charges or otherwise whatsoever)
unless the deduction or withholding is required by law, in which event
the Fifth Issuer Account Bank shall:
(a) ensure that the deduction or withholding does not exceed the
minimum amount legally required;
(b) pay to the relevant taxation or other authorities within the
period for payment permitted by applicable law the full amount of
the deduction or withholding;
11
(c) furnish to the Fifth Issuer or the Security Trustee (as the case
may be) within the period for payment permitted by the relevant
law, either:
(i) an official receipt of the relevant taxation authorities
involved in respect of all amounts so deducted or withheld;
or
(ii) if such receipts are not issued by the taxation authorities
concerned on payment to them of amounts so deducted or
withheld, a certificate of deduction or equivalent evidence
of the relevant deduction or withholding; and
(d) account to the Fifth Issuer in full by credit to the relevant
Fifth Issuer Account of an amount equal to the amount of any
rebate, repayment or reimbursement of any deduction or withholding
which the Fifth Issuer Account Bank has made pursuant to this
CLAUSE 15 and which is subsequently received by the Fifth Issuer
Account Bank.
16. TAX STATUS
16.1 The Fifth Issuer Account Bank hereby represents and warrants that it is a
bank for the purposes of section 349 of the Income and Corporation Xxxxx
Xxx 0000, is entering into this Agreement in the ordinary course of its
business, will pay interest pursuant hereto in the ordinary course of
such business, will bring into account payments (other than deposits)
made under this Agreement in computing its income for United Kingdom Tax
purposes and undertakes that it will not cease to be so or to do so
otherwise than as a result of the introduction of, change in, or change
in the interpretation, administration or application of, any law or
regulation or any practice or concession of the United Kingdom Inland
Revenue occurring after the date of this Agreement.
16.2 The Fifth Issuer Account Bank will procure that any of its successors or
assigns will provide the same representation as to its Tax status as is
provided by the relevant Fifth Issuer Account Bank in CLAUSE 16.1 above.
17. ENTIRE AGREEMENT
This Agreement and the schedules together constitute the entire agreement
and understanding between the parties in relation to the subject matter
hereof and cancel and replace any other agreement or understanding in
relation thereto.
18. VARIATION AND WAIVER
No variation, waiver or novation of this Agreement or any provision(s) of
this Agreement shall be effective unless it is in writing and executed by
(or by some person duly authorised by) each of the parties hereto. 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. ASSIGNMENT
Subject as provided in or contemplated by CLAUSES 6.1(f) and 8.2:
(a) the Fifth Issuer Account Bank may not assign or transfer any of
its rights or obligations hereunder without the prior written
consent of the Fifth Issuer and the Security Trustee;
12
(b) the Fifth Issuer may not assign or transfer any of its rights or
obligations hereunder without the prior written consent of the
Fifth Issuer Account Bank and the Security Trustee; and
(c) the Fifth Issuer Account Bank may not act through any other branch
other than the branch specified on page 1 of this Agreement
without the prior written consent of the Fifth Issuer and the
Security Trustee (such consent not to be unreasonably withheld).
20. THE SECURITY TRUSTEE
The Security Trustee has agreed to become a party to this Agreement for
the better preservation and enforcement of its rights under this
Agreement but shall have no responsibility for any of the obligations of,
nor assume any liabilities to, the Fifth Issuer Cash Manager, the Fifth
Issuer Account Bank or the Fifth Issuer hereunder. Furthermore, any
liberty or power which may be exercised or made in the Security Trustee's
absolute discretion without any obligation to give reasons therefor, but
shall in any event be exercised in accordance with the provisions of the
Funding 1 Deed of Charge.
21. EXCLUSION OF THIRD PARTY RIGHTS
A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of this
Agreement, but this does not affect any right or remedy of a third party
which exists or is available apart from that Act.
22. COUNTERPARTS
This Agreement may be signed (manually or by facsimile) and delivered in
one or more counterpart, all of which, taken together, shall constitute
one and the same document.
23. GOVERNING LAW
This Agreement shall be governed by, and construed in accordance with,
the laws of England.
24. SUBMISSION TO JURISDICTION
Each party to this Agreement hereby irrevocably submits to the non-
exclusive jurisdiction of the English courts in any action or proceeding
arising out of or relating to this Agreement, and hereby irrevocably
agrees that all claims in respect of such action or proceeding may be
heard and determined by such courts. Each party to this Agreement hereby
irrevocably waives, to the fullest extent it may possibly do so, any
defence or claim that the English courts are an inconvenient forum for
the maintenance or hearing of such action or proceeding.
IN WITNESS WHEREOF the parties hereto have executed this Agreement the day and
year first before written.
13
SCHEDULE 1
FORM OF FIFTH ISSUER TRANSACTION ACCOUNT MANDATE
IN THE FORM ATTACHED
14
SCHEDULE 2
FORM OF NOTICE OF ASSIGNMENT AND ACKNOWLEDGEMENT OF ASSIGNMENT
PART 1
NOTICE OF ASSIGNMENT - FIFTH ISSUER ACCOUNTS
To: The Governor and Company of the Bank of Scotland
000 Xxxxxxxxxx Xxxxxx
Xxxxx
XX0 0XX
For the attention of: Company Secretary
With a copy to: The Bank of New York
00xx Xxxxx
Xxx Xxxxxx Xxxxxx
Xxxxxx
X00 0XX
For the attention of:Global Structured Finance - Corporate Trust
Date: [{circle}], 2004
Dear Sirs,
RE: PERMANENT FINANCING (NO. 5) PLC
We hereby give you notice that, by a deed of charge dated of even date herewith
and made between, inter alios, ourselves, Halifax plc and The Bank of New York,
(the SECURITY TRUSTEE), a copy of which is enclosed (the FIFTH ISSUER DEED OF
CHARGE), we:
(a) assigned (or to the extent not assignable charged) by way of first fixed
security all of our right, title, benefit and interest present and future
in and, to now or in the future all moneys standing to the credit of the
Fifth Issuer Transaction Account - account number [{circle}] (sort code
14-24-55) and all interest accruing thereon from time to time;
(b) assigned (or to the extent not assignable charged) by way of first fixed
security all of our right, title, benefit and interest present and future
in and to all moneys standing to the credit of any Additional Fifth
Issuer Account established pursuant to CLAUSE 3.1 of the Fifth Issuer
Bank Account Agreement and all interest accruing thereon from time to
time;
(c) assigned by way of first fixed security all of our right, title, benefit
and interest present and future in, to and under the Fifth Issuer Bank
Account Agreement of even date herewith between ourselves, yourselves,
the Security Trustee and Halifax plc in its capacity as Fifth Issuer Cash
Manager.
Accordingly, amounts may and shall be withdrawn from time to time from the
Fifth Issuer Transaction Account and/or any Additional Fifth Issuer Account
established pursuant to CLAUSE 3.1 of
15
the Fifth Issuer Bank Account Agreement in accordance with the provisions of the
Fifth Issuer Cash Management Agreement and the Fifth Issuer Deed of Charge until
such time as you receive notice in writing from the Security Trustee in which
case you shall thereafter comply with all directions of the Security Trustee.
Please note that the foregoing authorisations and instructions may not be
revoked or varied by ourselves without the prior written consent of the
Security Trustee.
Please acknowledge receipt of this notice and your acceptance of the
instructions herein contained by signing two copies of the attached form of
acknowledgement, returning one copy to ourselves and sending the other copy
direct to the Security Trustee at 00xx Xxxxx, Xxx Xxxxxx Xxxxxx, Xxxxxx X00 0XX
for the attention of the Global Structured Finance - Corporate Trust.
This notice of charge and assignment is governed by, and construed in
accordance with, the laws of England. Words defined in the Fifth Issuer Master
Definitions and Construction Schedule referred to in CLAUSE 1 of the Fifth
Issuer Deed of Charge shall have the same meaning in this notice.
Yours faithfully
.........................................................
for and on behalf of
PERMANENT FINANCING (NO. 5) PLC
16
PART 2
ACKNOWLEDGEMENT - FIFTH ISSUER ACCOUNTS
To: Permanent Financing (No. 5) PLC
Xxxxxxxxx Xxxxx
Xxxxxxxxx Xxxx
Xxxxxx XX0X 0XX
For the attention of the Company Secretary
and to: The Bank of New York
00xx Xxxxx
Xxx Xxxxxx Xxxxxx
Xxxxxx
X00 0XX
(the SECURITY TRUSTEE)
For the attention of Global Structured Finance - Corporate Trust
Date: [{circle}], 2004
Dear Sir,
RE: PERMANENT FINANCING (NO. 5) PLC
We acknowledge receipt of your letter dated [{circle}], 2004, a copy of which
is attached. Words and expressions defined in that letter have the same
meanings herein.
In consideration of your agreeing to maintain or establish the Fifth Issuer
Accounts with us, we now agree and confirm to the Security Trustee that we
accept and will comply with the authorisations and instructions contained in
that letter and will not accept or act upon any instructions contrary thereto
unless the same shall be in writing signed by the Security Trustee.
This acknowledgement is governed by, and construed in accordance with, the laws
of England.
Yours faithfully,
..............................................
for and on behalf of
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND
17
SIGNATORIES
FIFTH ISSUER
SIGNED by )
for and on behalf of )
PERMANENT FINANCING (NO. 5) PLC )
FIFTH ISSUER CASH MANAGER
SIGNED by )
as attorney for and on behalf of ) (as attorney as aforesaid)
HALIFAX PLC in the presence of: )
Witness's Signature:..............
Name:.............................
Address:..........................
FIFTH ISSUER ACCOUNT BANK
SIGNED by )
as attorney for and on behalf of )
THE GOVERNOR AND COMPANY OF ) (as attorney as aforesaid)
THE BANK OF SCOTLAND in the )
presence of: )
Witness's Signature...............
Name:.............................
Address:..........................
SECURITY TRUSTEE
SIGNED by )
for and on behalf of )
THE BANK OF NEW YORK )
18
