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[ N A M E O F I S S U E R ] ( i n c o r p o r a t e d i n E n g l a n d a n d W a l e s w i t h l i m i t e d l i a b i l i t y u n d e r r e g i s t e r e d n u m b e r [ " ] ) [ / ] [ i n s e r t a m o u n t o f p r o g r a m m e ] G l o b a l C o v e r e d B o n d P r o g r a m m e
U n c o n d i t i o n a l l y a n d i r r e v o c a b l y g u a r a n t e e d a s t o p a y m e n t s b y
[ I n s e r t n a m e o f L L P ]
( a l i m i t e d l i a b i l i t y p a r t n e r s h i p i n c o r p o r a t e d i n E n g l a n d a n d W a l e s w i t h r e g i s t e r e d n u m b e r [ " ] )
P r o g r a m m e U n d e r t h i s [ / ] [ " ] b i l l i o n c o v e r e d b o n d p r o g r a m m e ( t h e " P r o g r a m m e X E " P r o g r a m m e " " ) , [ " ] ( t h e " I s s u e r X E " I s s u e r " " ) m a y f r o m t i m e t o t i m e i s s u e b o n d s ( t h e " C o v e r e d B o n d s X E " C o v e r e d B o n d s " " ) d e n o m i n a t e d i n [ / / $ / o t h e r ] . T h e m a x i m u m a g g r e g a t e a m o u n t o f a l l C o v e r e d B o n d s f r o m t i m e t o t i m e o u t s t a n d i n g w i l l n o t e x c e e d [ / ] [ " ] b i l l i o n [ ( o r i t s e q u i v a l e n t i n o t h e r c u r r e n c i e s ) ] . C o v e r e d B o n d s i s s u e d u n d e r t h e P r o g r a m m e [ h a v e b e e n a n d ] w i l l b e i s s u e d i n S e r i e s . F i n a l T e r m s E a c h S e r i e s w i l l b e s u b j e c t t o F i n a l T e r m s , w h i c h , f o r t h e p u r p o s e o f t h a t S e r i e s o n l y , supplements the Terms and Conditions of the Covered Bonds in this Base Prospectus and must be read in conjunction with this Base Prospectus. Regulated Covered Bonds[The Issuer has been admitted to the register of issuers and the Programme and the Covered Bonds issued under the Programme (including those Covered Bonds issued prior to the date of admission) have been admitted to the register of regulated covered bonds]/[The Issuer has applied for registration to the register of issuers and the Programme and for the Covered Bonds issued under the Programme to be admitted to the register of regulated covered bonds]/[Not applicable]GuaranteeThe Issuer is expected to make payments of principal and interest due on the Covered Bonds. However, [insert name of LLP] (the "LLP XE "LLP" ") has guaranteed payments of interest and principal under the Covered Bonds pursuant to the Covered Bond Guarantee which is secured over the Mortgage Portfolio XE "Mortgage Portfolio" and its other assets. Recourse to the LLP under its guarantee is limited to the Mortgage Portfolio and such other assets of the LLP.Dual RecourseThe Covered Bond Guarantee will be activated following occurrence of an Issuer Event of Default and the service of an Issuer Acceleration Notice on the Issuer (or, if earlier, the service on the Issuer and the LLP of an LLP Acceleration Notice). The Covered Bonds will only be accelerated against the Issuer and will not be accelerated against the LLP.
If, upon the occurrence of an LLP Event of Default an LLP Acceleration Notice is served on the LLP, the Covered Bonds will become immediately due and payable as against the Issuer (if not already immediately due and payable as against the Issuer) and also against the LLP and the LLP's obligations under the Covered Bond Guarantee will be accelerated.Underlying AssetsThe LLP's primary source of funds to make payments under the Covered Bond Guarantee will be derived from, inter alia, payments of interest and principal in relation to a portfolio of residential mortgage loans originated and/or acquired by [name of Seller/Originator] and secured over properties located in []. These Mortgage Loans will be purchased by the LLP on the Transfer Dates, subject to certain criteria being satisfied [cross refer to section of the prospectus containing further information on this]. Credit Enhancement- Covered Bond Guarantee: [Cross refer to section of the Prospectus containing further information on this]
- Asset Coverage Test: [Cross refer to section of the Prospectus containing further information on this]
- Amortisation Test: [Cross refer to section of the Prospectus containing further information on this]
- Reserve Fund: [Cross refer to section of the Prospectus containing further information on this]
- [Others, e.g. GIC rate (if relevant)]: [Cross refer to section of the Prospectus containing further information on this]Liquidity Support- Pre-Maturity Liquidity: [Cross refer to section of the Prospectus containing further information on this]
- [Others (if relevant)]: [Cross refer to section of the Prospectus containing further information on this]Redemption ProvisionsInformation on any optional and mandatory redemption of the Covered Bonds is [summarised on page [] and] set out in [full in Condition [] [Cross refer to section of the Prospectus containing further information on this].Credit Rating Agencies[List the rating agencies]. [Specify basis of ratings]. Each of such Credit Rating Agencies are [authorised] under The Credit Rating Agencies Regulations 2010 (the "CRA Regulations XE "CRA Regulations" ").Credit RatingsCovered Bonds to be issued under the Programme are expected to be rated ["AAA"] by [S&P], ["AAA"] by [Fitch] [and] ["Aaa"] by [Moody's] [and] [insert any other rating agency expected ratings], unless otherwise specified in the relevant Final Terms. Each Series of Covered Bonds is expected on issue to be assigned a rating by each Credit Rating Agency. The ratings expected to be assigned to each Series of Covered Bonds will be stated in the Final Terms for that Series of Covered Bonds.
[The ratings assigned by [Fitch] [and] [S&P] address the likelihood of (a) timely payment of interest due to the Covered Bondholders on each Interest Payment Date and ((b) full payment of principal by a date that is not later than the Final Maturity Date of the relevant Series of Covered Bonds. The ratings assigned by Moody's address the expected loss to a Covered Bondholder in proportion to the initial principal amount of the Covered Bonds held by a Covered Bondholder by the Final Maturity Date.] [Others tbc]
A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning Credit Rating Agency.ListingThis document comprises a prospectus (the "Prospectus XE "Prospectus" "), for the purpose of Directive 2003/71/EC (the "Prospectus Directive XE "Prospectus Directive" "). An application has been made to the [name of competent authority] as competent authority under the Prospectus Directive XE "Prospectus Directive" in order for the Prospectus XE "Prospectus" to be approved. An application has been made to the [name of relevant authority and/or stock exchange] for the Covered Bonds to be admitted to the Official List (the "Official List XE "Official List" ") and trading on its regulated market. The Final Terms relating to each Tranche of Covered Bonds will state whether or not the Covered Bonds are to be listed and/or admitted to trading and, if so, on which stock exchange(s) and/or markets. The regulated market of [name of relevant stock exchange] is a regulated market for the purposes of Directive 2004/39/EC (the "Markets in Financial Instruments Directive").
[Only if N Bonds are contemplated] N Covered Bonds will not be listed and/or admitted to trading.Clearing SystemsEuroclear Bank S.A./N.V./Clearstream Banking, socit anonyme/[The Depository Trust Company] as indicated in the relevant Final Terms.
[Only if N Bonds are contemplated] [N Covered Bonds will not be settled through a clearing system.]THE "RISK FACTORS" SECTION CONTAINS DETAILS OF CERTAIN RISKS AND OTHER FACTORS THAT SHOULD BE GIVEN PARTICULAR CONSIDERATION BEFORE INVESTING IN THE COVERED BONDS. PROSPECTIVE INVESTORS SHOULD BE AWARE OF THE ISSUES SUMMARISED WITHIN THAT SECTION.
Arranger[s]
[]
Dealer[s]
[] [] []
[Date of Prospectus]
[Important information, responsibility statement, stabilisation language etc to be inserted]
DIAGRAMMATIC OVERVIEW OF THE TRANSACTION
Visio doc 2543060
DIAGRAMMATIC OVERVIEW OF THE ON-GOING CASHFLOWS
Visio doc 2510075
[If there are other features of the transaction, please include those features in the relevant diagram]
OWNERSHIP STRUCTURE OF THE LLP
Visio doc 2603610
TRANSACTION OVERVIEW
The information set out below is an overview of various aspect of the transaction. This overview is not purported to be complete, should be read in conjunction with, and is qualified in its entirety by references to, the detailed information presented elsewhere in this Base Prospectus.
PRINCIPAL CHARACTERISTICS OF THE COVERED BOND PROGRAMME
Issuer[]Guarantor[]Regulated Covered Bonds[Admitted to the register of issuers and the register of regulated covered bonds][Not applicable].Nature of eligible cover pool propertyResidential mortgage loans and their related security and Authorised InvestmentsCompliant with the Banking Consolidation Directive[Yes, the Programme is intended to be compliant with the Banking Consolidation Directive][No, the Programme is not intended to be compliant with the Banking Consolidation Directive].Location of eligible residential property underlying Mortgages[England, Wales, Northern Ireland and Scotland] Maximum Loan to Value Ratio given credit under the Asset Coverage Test[] per cent.Maximum Asset Percentage[] per cent.Asset Coverage TestSee page[]Amortisation TestSee page []Reserve Fund[describe application of Reserve Fund]Extendable MaturitiesAvailableHard Bullet MaturitiesAvailableAsset Monitor[]Asset SegregationYes[N Covered Bond (Namensschuldverschreibung)][Available]/[Not Available]
TRANSACTION PARTIES
Party
Name
AddressDocument under which appointed / Further InformationIssuer[][]N/A [Cross refer to section of the Prospectus containing further information on this]LLP[][]N/A [Cross refer to section of the Prospectus containing further information on this]Seller/Originator [][]N/A [Cross refer to section of the Prospectus containing further information on this]Servicer XE "Servicer" [][][Cross refer to section of the Prospectus containing further information on this][Standby Servicer XE "Standby Servicer" ][][][Cross refer to section of the Prospectus containing further information on this]Cash Manager XE "Cash Manager" [][][Cross refer to section of the Prospectus containing further information on this][Standby Cash Manager XE "Standby Cash Manager" ][][][Cross refer to section of the Prospectus containing further information on this]Basis/Interest Rate/TRS Swap Provider XE "Basis/Interest Rate/TRS Swap Provider" [][][Cross refer to section of the Prospectus containing further information on this]Covered Bond Swap Provider(s) XE "Covered Bond Swap Provider" As specified in the Final Terms relating to each Tranche of Covered BondsAs specified in the Final Terms relating to each Tranche of Covered Bonds[Cross refer to section of the Prospectus containing further information on this][Standby Swap Provider(s)] XE "Standby Swap Provider" [][][Cross refer to section of the Prospectus containing further information on this]LLP Account Bank XE "LLP Account Bank" [][][Cross refer to section of the Prospectus containing further information on this]GIC Provider XE "GIC Provider" [][][Cross refer to section of the Prospectus containing further information on this]Security Trustee XE "Security Trustee" [][][Cross refer to section of the Prospectus containing further information on this]Bond Trustee XE "Bond Trustee" [][][Cross refer to section of the Prospectus containing further information on this]Registrar XE "Registrar" [][][Cross refer to section of the Prospectus containing further information on this]Principal Paying Agent XE "Principal Paying Agent" [][][Cross refer to section of the Prospectus containing further information on this]Exchange Agent XE "Exchange Agent" and Transfer Agent XE "Transfer Agent" [][][Cross refer to section of the Prospectus containing further information on this]Asset Monitor XE "Asset Monitor" [][][Cross refer to section of the Prospectus containing further information on this]Liquidation Member XE "Liquidation Member" [][][Cross refer to section of the Prospectus containing further information on this]Corporate Services Provider XE "Corporate Services Provider" [][][Cross refer to section of the Prospectus containing further information on this][N Covered Bond Registrar XE "N Covered Bond Registrar" (if any)][][][Cross refer to section of the Prospectus containing further information on this][N Covered Bond Paying Agent XE "N Covered Bond Paying Agent" (if any)][][][Cross refer to section of the Prospectus containing further information on this]Rating Agencies[][]N/A
[List additional transaction parties if relevant]MORTGAGE PORTFOLIO AND SERVICING
Please refer to the sections entitled "The Mortgage Loans and the Mortgage Portfolio", "Summary of the Principal Documents Mortgage Sale Agreement" and "Summary of the Principal Documents Servicing Agreement" for further detail in respect of the characteristics of the Mortgage Portfolio and the sale and servicing arrangements in respect of the Mortgage Portfolio.
Sale of PortfolioThe Mortgage Portfolio will consist of the Mortgage Loans, the Related Security and all monies derived therein from time to time, which will be sold to the LLP on each Transfer Date.
Each Mortgage Loan and the Related Security will be governed by [English] law. [Specify any additional jurisdictions].
[Cross refer to section of the prospectus containing further information on this].Features of Mortgage Loans XE "Mortgage Loans" The following is a summary of certain features of the Mortgage Loans XE "Mortgage Loans" as at the date of this Base Prospectus and investors should refer to, and carefully consider, further details in respect of the Mortgage Loans set out in the relevant Final Terms.
[Type of Borrower]
[percentage of prime/non-prime]
Type of mortgage
[repayment/interest only]
Self-certified Loans XE "Self-certified Loans"
[yes/no]
Fast-track Loans XE "Fast-track Loans"
[yes/no]
Buy-to-let Loans XE "Buy-to-let Loans"
[yes/no]
Number of Mortgage Loans
[]
Number of Borrowers
[]
Weighted average
Minimum
Maximum
Current Balance XE "Current Balance"
[]
[]
[]
[Indexed XE "Indexed LTV" /Current XE "Current LTV" /Original XE "Original LTV" ] LTV
[]
[]
[]
Seasoning (months)
[]
[]
[]
Remaining Term
[]
[]
[]
Debt to income ratios or income multiplier
[]
[]
[]
[Insert others]
ConsiderationConsideration payable by the LLP in respect of the sale of the Mortgage Portfolio will be a [describe the basis on which Transfer Date consideration is calculated, e.g. Outstanding Principal Amount of the Mortgage Loans plus accrued but unpaid interest] and deferred consideration.Eligibility CriteriaAny New Mortgage Loans and the Related Security must comply with, among other things, the following criteria:
no Issuer Event of Default or LLP Event of Default has occurred/is occurring;
the weighted average yield on the Mortgage Loans [contained in the Mortgage Portfolio as at the date hereof] is at least [] per cent. greater than [insert reference parameter, e.g. LIBOR for one-month sterling deposits];
no Mortgage Loan has a principal balance of more than [];
all Mortgage Loans relate to residential properties;
no Mortgage Loan is in arrears for more than [] days; and
[specify others if any].Representations and WarrantiesThe Seller will make the relevant Loan Warranties to the Mortgages Trustee on the Programme Date and each Transfer Date [specify other time on which representations are made, if any].
The Loan Warranties will include (but not be limited to) representations and warranties in relation the following matters:
legal nature of the Mortgage Loans and their Related Security (i.e. the valid, binding and enforceable nature of the relevant Mortgage Loan and the Related Security);
first ranking Security in respect of properties located in [];
permitted product type which would include [specify product types to be included, e.g. buy to let, self-certified];
maximum loan amount not exceeding [];
minimum payment made not less than [];
maximum arrears not exceeding [];
[Original]/[Current]/[Indexed] Maximum LTV not exceeding []; and
final Mortgage Loan repayment date not falling beyond [].
[Cross refer to full list of representations and warranties in the relevant section of the Base Prospectus]Repurchase of the Mortgage LoansThe Seller will re-purchase the relevant Mortgage Loans and their Related Security in the following circumstances:
upon breach of Loan Warranties (which is either not capable of remedy or if the Seller failed to remedy it within the agreed grace period);
[(if applicable), upon making Further Advances and/or Product Switches]; [and]
[specify others (if applicable)].
[The Seller may repurchase the relevant Mortgage Loans and their Related Security in the following circumstances:
[if the Seller exercise its general call option]; [TBD]
[specify others, if any].]Consideration for RepurchaseConsideration payable by the Seller in respect of the repurchase of the Mortgage Loans shall be equal to [describe the basis on which the repurchase price is calculated, e.g. the Outstanding Principal Amount of the Mortgage Loans plus accrued but unpaid interest].Sale of Selected Mortgage LoansBreach of the Pre-Maturity Test and/or occurrence of an Issuer Event of Default, [service of an Asset Coverage Test Breach Notice (which has not been revoked),] service of an Issuer Acceleration Notice and/or service of a Notice to Pay (prior to service of an LLP Acceleration Notice and/or realisation of the Security and/or commencement of windingup proceedings against the LLP) will mean that the LLP will be obliged to sell Selected Mortgage Loans, subject to the rights of pre-emption enjoyed by the Seller. The proceeds from any such sale will be credited to the GIC Account and applied as set out in the relevant Priorities of Payments. If the LLP is required to sell Selected Mortgage Loans and their Related Security, the LLP will ensure that (a) the Selected Mortgage Loans have been selected from the Mortgage Loan Portfolio on a random basis and (b) the amount that the LLP is required to receive for the sale of such Selected Mortgage Loans will vary depending on the occurrence of the event that requires such sale. [Cross refer to section of the Prospectus containing further information on this].Perfection EventsTransfer of the legal title to the relevant Mortgage Loans will be completed on the occurrence of certain Perfection Events, which include insolvency of the Seller, downgrade of the Seller to below the agreed ratings (as to which see below "Rating Triggers Table") and [list others].Prior to the completion of the transfer of legal title to the Mortgage Loans, the LLP will hold only the equitable title to those Mortgage Loans [or, in the case of Scottish Mortgage Loans, will be the sole beneficiary under the grant of a declaration of trust] and will therefore be subject to certain risks as set out in [] in the section entitled "Risk Factors".Servicing of the Mortgage PortfolioThe Servicer will be appointed by the Seller and the LLP to service the Mortgage Portfolio on a day-to-day basis. The appointment of the Servicer may be terminated by the LLP upon occurrence of the following events (each a "Servicer Event of Default"):
Servicer Insolvency Event;
material non performance;
[specify others].
The Servicer may also resign upon giving [] days' notice provided a replacement servicer has been appointed by the LLP.
[Covered Bondholders have no right to require the termination of the appointment of the Servicer in the absence of an Servicer Termination Event. Once a Servicer Termination Event has occurred, Covered Bondholders may, by Extraordinary Resolution, require the replacement of the Servicer.]DelegationThe Servicer may delegate some of its servicing function to a third party provided that the Servicer remains responsible for the performance of any of its servicing function so delegated. [Cross refer to section of the Prospectus containing further information on this].[Please set out any other key features of the Mortgage Portfolio and/or Servicing particular for this transaction which are not described in this section]
SUMMARY OF THE TERMS AND CONDITIONS OF THE COVERED BONDS
Please refer to section entitled "Terms and Conditions of the Covered Bonds" for furt h e r d e t a i l i n r e s p e c t o f t h e t e r m s o f t h e C o v e r e d B o n d s .
P r o g r a m m e S i z e U p t o [ / ] [ " ] b i l l i o n o u t s t a n d i n g a t a n y t i m e ( o r i t s e q u i v a l e n t i n o t h e r c u r r e n c i e s a s s e t o u t i n t h e P r o g r a m m e A g r e e m e n t ) . T h e I s s u e r m a y i n c r e a s e t h e a m o u n t o f t h e P r o g r a m m e i n a ccordance with the terms of the Programme Agreement.DistributionCovered Bonds may be distributed by way of private or public placement and in each case on a syndicated or non-syndicated basis, subject to the restrictions set forth in [Cross refer to section of the Prospectus containing further information on this].Specified CurrenciesAs set out in the applicable Final Terms.Issue PriceCovered Bonds may be issued at par or at a premium or discount to par on a fully-paid basis or partly-paid basis, in each case as specified in the applicable Final Terms.Form of Covered BondsThe Covered Bonds will be issued in bearer or registered form as described in [Cross refer to section of the Prospectus containing further information on this]. [The Issuer will also be able to issue N Covered Bonds.]
The types of Covered Bonds that can be issued under the Programme include the following:
Fixed Rate Covered Bonds;
Floating Rate Covered Bonds;
Index Linked Covered Bonds;
Dual Currency Covered Bonds;
Zero Coupon Covered Bonds; and
Partly Paid Covered Bonds,
in each case as specified in the applicable Final Terms.RedemptionThe applicable Final Terms will indicate either that the relevant Covered Bonds:
cannot be redeemed prior to their stated maturity (other than in specified instalments, if applicable); or
can be redeemed for taxation reasons, if applicable; or
can be redeemed in the case of illegality, if applicable; or
can be redeemed at the option of the Issuer on such terms as may be agreed between the Issuer and the relevant Dealer(s),
in each case as set out in the applicable Final Terms.MaturitiesCovered Bonds may be issued with any maturity as specified in the relevant Final Terms.Final RedemptionIf not previously redeemed, on the Final Maturity Date as specified in the relevant Final Terms.Mandatory RedemptionEach series will be subject to mandatory early redemption in part or in full in accordance with the terms and conditions of the relevant Covered Bonds.Optional RedemptionEach series will be subject to optional early redemption in part or in full in accordance with the terms and conditions of the relevant Covered Bonds.Extendable obligations under the Covered Bond GuaranteeThe applicable Final Terms may also specify that the Final Maturity Date in relation to the applicable Series of Covered Bonds may be deferred until an Extended Due for Payment Date [Cross refer to section of the Prospectus containing further information on this]. Denomination of Covered BondsCovered Bonds will be issued in such denominations as may be agreed between the Issuer and the relevant Dealer(s) and as indicated in the applicable Final Terms.TaxationAll payments in respect of the Covered Bonds will be made without deduction or withholding for or on account of United Kingdom tax, subject as provided in Condition [] (Taxation). Under the Covered Bond Guarantee, the LLP is not required to pay any additional amounts in respect of any withholding or deduction from payments, and will not be liable to make guarantee payments in respect of any such additional amounts.[Neither the Issuer nor the LLP will be obliged to pay any additional amounts in respect of any withholding or deduction from payments in respect of the N Covered Bonds.]Cross DefaultIf an Issuer Event of Default occurs and an Issuer Acceleration Notice is served in respect of a particular Series of Covered Bonds, then the Covered Bonds of all Series outstanding will accelerate at the same time against the Issuer, but will be subject to, and have the benefit of, payments made by the LLP under the Covered Bond Guarantee (following service of a Notice to Pay on the LLP).
If an LLP Acceleration Notice is served in respect of any one Series of Covered Bonds, then the obligation of the LLP to pay Guaranteed Amounts in respect of all Series of Covered Bonds outstanding will be accelerated.Status of the Covered BondsThe Covered Bonds will constitute direct, unconditional, unsubordinated and unsecured obligations of the Issuer and will rank pari passu without any preference among themselves and (save for any applicable statutory provisions) at least equally with all other present and future unsecured and unsubordinated obligations of the Issuer.Covered Bond GuaranteeIn addition to the obligations of the Issuer under the Covered Bonds, payment of interest and principal on the Covered Bonds (such amounts, the Guaranteed Amounts) will be irrevocably guaranteed by the LLP. The obligations of the LLP to make payment in respect of the Guaranteed Amounts are subject to the condition that an Issuer Event of Default occurs, an Issuer Acceleration Notice is served on the Issuer and [either an Asset Coverage Test Breach Notice which has not been revoked or] a Notice to Pay is served on the LLP or, if earlier, an LLP Event of Default occurs and an LLP Acceleration Notice is served on the LLP. The obligations of the LLP under the Covered Bond Guarantee constitute direct obligations of the LLP secured against the assets from time to time of the LLP and recourse against the LLP is limited to such assets.Issuer Events of DefaultAs fully set out in Condition []. [Cross refer to section of the Prospectus containing further information on this], which broadly includes (where relevant, subject to the applicable grace period):
non-payment of interest or principal in respect of the Covered Bonds;
breach of contractual obligations by the Issuer under the Transaction Documents;
illegality;
an Insolvency Event;
[service of an Asset Coverage Test Breach Notice which has not been revoked on or before the third Calculation Date after service of such Asset Coverage Test Breach Notice]/[breach of the Asset Coverage Test on a Calculation Date which is not remedied by the immediately succeeding Calculation Date];
[specify others if any].LLP Events of DefaultAs fully set out in Condition []. [Cross refer to the section of the Prospectus containing further information on this], which broadly includes (where relevant, subject to the applicable grace period):
non-payment of Guaranteed Amounts;
breach of contractual obligations by the LLP under the Transaction Documents;
Insolvency Event;
breach of Amortisation Test;
[specify others if any]Governing LawThe Covered Bonds [, other than the N Covered Bonds,] will be governed by, and construed in accordance with, English law.
[The N Covered Bonds will be governed by, and construed in accordance with, the laws of the Federal Republic of Germany.][Please set out any other key features of the Covered Bonds particular for this transaction which are not described in this section]
OVERVIEW OF RIGHTS OF COVERED BONDHOLDERS
Please refer to the section entitled "Terms and Conditions of the Covered Bonds" for further detail in respect of the rights of Covered Bondholders, conditions for exercising such rights and relationship with other Secured Creditors.
PaymentsThe Covered Bondholders will be entitled to payment of principal upon final redemption in respect of each Covered Bond upon presentation and surrender of the individual certificate representing such Covered Bond.Taxation The Covered Bondholders will be entitled to receive all payments in respect of the Covered Bonds free and clear of, and without withholding or deduction for or on account of, any present or future taxes, duties, assessments or governmental charges of whatsoever nature unless the Issuer or the LLP is required by applicable law to make any payment in respect of the Covered Bonds subject to any such withholding or deduction. Prior to an Issuer Event of Default and LLP Event of DefaultCovered Bondholders holding more than [5]% of the Principal Amount Outstanding of the Covered Bonds then outstanding are entitled to convene a Covered Bondholders' meeting or participate in a Covered Bondholders' meeting convened by the Issuer, LLP or Bond Trustee to consider any matter affecting their interests.
However, so long as no Issuer Event of Default has occurred, the Covered Bondholders are not entitled to instruct or direct the Issuer to take any actions, either directly or through the Bond Trustee, without consent of the Issuer and, if applicable, certain other transaction parties, unless the Issuer has an obligation to take such actions under the relevant Transaction Documents.Following an Issuer Event of Default or an LLP Event of Default
No Covered Bondholder will be entitled to proceed directly against the Issuer or the LLP, including against the Covered Bonds, the Receipts or the Security unless the Bond Trustee or the Security Trustee, as applicable, having become bound to proceed against the Issuer or the LLP, fail so to do within a reasonable time.
Following an Issuer Event of Default, Covered Bondholders may, by extraordinary resolution of all the Covered Bondholders or written resolution of the holders of more than [25]% of the outstanding Covered Bonds, direct the Bond Trustee to enforce the terms of the Trust Deed and the Covered Bonds against the Issuer and/or the LLP provided that the Bond Trustee has been has been indemnified and/or secured to its satisfaction. The Bond Trustee also has a general discretion to take such action following an Issuer Event of Default.
Following an LLP Event of Default, Covered Bondholders may, by extraordinary resolution of all the Covered Bondholders or written resolution of the holders of more than [25]% of the outstanding Covered Bonds, direct the Security Trustee to enforce the Security provided that the Security Trustee has been has been indemnified and/or secured to its satisfaction The Bond Trustee also has a general discretion to take such action following an LLP Event of Default.
[Specify if there are different voting requirements in relation to enforcement of Security and/or sale of underlying assets]Covered Bondholders Meeting provisionsNotice Periods
Initial Meeting:
[21 clear days for the initial meeting]
Adjourned Meeting:
[No less than 13 clear days and no more than 42 clear days for the adjourned meeting]
Quorum for Extraordinary Resolution
Initial Meeting:
[50% of the Principal Amount Outstanding of the relevant Series of Covered Bonds for the initial meeting (other than a Series Reserved Matter, which requires [two thirds] of the Principal Amount Outstanding of the relevant Series of Covered Bonds).]
[However, any Extraordinary Resolution to direct the Bond Trustee to serve an Issuer Acceleration Notice or a Notice to Pay following an Issuer Event of Default, to direct the Bond Trustee to serve an LLP Acceleration Notice following an LLP Event of Default and any direction to the Bond Trustee or Security Trustee to take any enforcement action must be passed at a single meeting of the holders of all Covered Bonds of all Series then outstanding and therefore the holders of a single Series of Covered Bonds may not be able to give any directions to the Bond Trustee or the Security Trustee without the agreement of the holders of other outstanding Series of Covered Bonds.]
Adjourned Meeting:
[Any holding for the adjourned meeting (other than Series Reserved Matter, which requires [one third] of the Principal Amount Outstanding of the relevant Series of Covered Bonds)].
Required Majorities
Ordinary Resolution:
[50% of votes cast for matters requiring Ordinary Resolution]
Extraordinary Resolution:
[75% of votes cast for matters requiring Extraordinary Resolution]
Written Resolution:
[75%] of the Principal Amount Outstanding of the relevant class of Covered Bonds. A Written Resolution has the same effect as an Extraordinary Resolution.
Matters requiring Extraordinary ResolutionBroadly speaking, the following matters require an Extraordinary Resolution.
Series Reserved Matter;
[List others].Relationship between Series of Covered BondholdersIn connection with the exercise by it of any of its trusts, powers and discretions, the Bond Trustee and the Security Trustee shall have regard to the general interests of the holders of the Covered Bonds of each Series as a class. An Extraordinary Resolution passed at any meeting of the holders of the Covered Bonds of a Series shall, subject as provided above, be binding on all the holders of the Covered Bonds of such Series, whether or not they are present at the meeting. The Bond Trustee may convene a single meeting of the holders of Covered Bonds of more than one Series if in the opinion of the Bond Trustee there is no conflict between the holders of such Covered Bonds.Relationship between Covered Bondholders and other Secured CreditorsIn exercising any of its powers, trusts, authorities and discretions under the Trust Deed, the Covered Bonds, the Receipts or the Coupons or any other Transaction Document, the Bond Trustee shall only have regard to the interests of the holders of the Covered Bonds while any Covered Bonds are outstanding and shall not have regard to the interests of any other Secured Creditors.
In exercising any of its powers, trusts, authorities and discretions under the Deed of Charge, the Security Trustee shall only have regard to the interests of the holders of the Covered Bonds while any Covered Bonds are outstanding and shall not have regard to the interests of any other Secured Creditors.Provision of Information to the Covered Bondholders[Information in respect of the underlying Mortgage Portfolio XE "Mortgage Portfolio" will be provided to the investors on a quarterly basis.]
[The [Cash Manager/Servicer] will further provide an investor report on a [quarterly] basis containing information in relation to the Covered Bonds and the Asset Coverage Test.]Communication with Covered BondholdersAny notice to be given by the Issuer or the Bond Trustee to Covered Bondholders shall be given in the following manner:
So long as the Covered Bonds are held in the Clearing Systems, by delivering to the relevant Clearing System for communication by it to Covered Bondholders; and
So long as the Covered Bonds are listed on a stock exchange or admitted to listing by any other relevant authority, by publication of such notice in a daily newspaper in accordance with the requirements of the relevant stock exchange or relevant authority; [and]
[Specify others].
[Other rules may apply for Bearer Definitive and Registered Definitive Covered Bonds].[Please set out any other key features of the Covered Bondholder rights particular for this transaction which are not described in this section]
CREDIT STRUCTURE AND CASHFLOW
Please refer to the sections entitled "Credit Structure" and "Cashflows" for further detail in respect of the credit structure and cash flow of the transaction
Visio 2543078
Credit SupportThere are a number of features of the Programme which enhance the likelihood of timely and, as applicable, ultimate payments to holders of the Covered Bonds, as follows:
the Covered Bond Guarantee provides credit support to the Issuer;
[the Pre-Maturity Test is intended to provide liquidity to the LLP in relation to amounts of principal due on the Final Maturity Date of the Hard Bullet Covered Bonds;]
the Asset Coverage Test is intended to test the asset coverage of the LLP's assets in respect of the Covered Bonds at all times;
the Amortisation Test is intended to test the asset coverage of the LLP's assets in respect of the Covered Bonds following the occurrence of an Issuer Event of Default, service of an Issuer Acceleration Notice on the Issuer and service of a Notice to Pay on the LLP;
a Reserve Fund will be established to trap Available Revenue Receipts; and
the GIC Provider has agreed to pay a variable rate of interest on all amounts held by the LLP in the GIC Account at a rate of []% per annum; [and]
[list any others if relevant].Payments by the IssuerUntil a Notice to Pay[, an Asset Coverage Test Breach Notice (which has not been revoked)] or an LLP Acceleration Notice is served on the LLP, the Covered Bonds will be obligations of the Issuer only. The Issuer is liable to make payments when due on the Covered Bonds, whether or not it has received any corresponding payment from the LLP.Available Funds of the LLPThe LLP will have Available Revenue Funds and Available Principal Funds available to it. Prior to service of a Notice to Pay [or an Asset Coverage Test Breach Notice (which has not been revoked)] on the LLP, Available Revenue Funds and Available Principal Funds will be applied by the LLP to make payments of interest and principal payments to the Issuer under the Intercompany Loan Agreement. Following the service of a Notice to Pay [or an Asset Coverage Test Breach Notice] on the LLP, Available Revenue Funds and Available Principal Funds will be applied by the LLP to meet its payment obligations under the Covered Bonds and the other Transaction Documents.
Available Revenue Funds will, broadly, include the following:
Revenue Receipts received during the immediately preceding Collection Period;
interest payable to the LLP on its bank accounts and income from any Authorised Investments and/or Substitution Assets during the relevant Collection Period;
amounts received by the LLP under the relevant Swap Agreements;
amounts standing to the credit of the Reserve Fund during the relevant Collection Period;
any other net income of the Issuer received during the immediately preceding Collection Period of a revenue nature; [and]
[list others if relevant],
less:
Third Party Amounts.
Available Principal Funds will, broadly, include all Principal Receipts received by the LLP during the immediately preceding Collection Period (including consideration paid by the Seller in respect of the repurchase of the Mortgage Loans and their Related Security, recoveries received by the LLP following the enforcement of the relevant Mortgage Loan, the proceeds of any sale of Selected Mortgage Loans, and receipt of realisation proceeds of the Related Security), any Cash Capital Contributions received from a Member, and amounts in respect of principal received by the LLP under the Currency Swap Agreement. [List others if relevant].Breach of the Asset Coverage Test[Option 1: if Programme has Asset Coverage Breach Test Notice features] [A breach of the Asset Coverage Test on a Calculation Date which is not remedied by the immediately succeeding Calculation Date will require the Bond Trustee to serve an Asset Coverage Test Breach Notice on the LLP. The Asset Coverage Test Breach Notice will be revoked if, on any Calculation Date falling on or prior to the [third] Calculation Date following service of an Asset Coverage Test Breach Notice, the Asset Coverage Test is satisfied and neither a Notice to Pay nor an LLP Acceleration Notice has been served.
If an Asset Coverage Test Breach Notice has been served and not revoked on or before the third Calculation Date after service of such Asset Coverage Test Breach Notice, then an Issuer Event of Default shall occur and the Bond Trustee shall be entitled (and, in certain circumstances, may be required) to serve an Issuer Acceleration Notice on the Issuer. Following service of an Issuer Acceleration Notice, the Trustee must serve a Notice to Pay on the LLP.For so long as an Asset Coverage Test Breach Notice is outstanding and has not been revoked, the LLP may not borrow any new Term Advances (and the Issuer may not make any new Term Advances) under the Intercompany Loan Agreement.]
[or]
[Option 2: if Programme does not have Asset Coverage Breach Test Notice features] [A breach of the Asset Coverage Test on a Calculation Date which is not remedied by the immediately succeeding Calculation Date will constitute an Issuer Event of Default and the Bond Trustee shall be entitled (and, in certain circumstances, may be required) to serve an Issuer Acceleration Notice on the Issuer and the LLP.]
Following service of an Issuer Acceleration Notice on the Issuer and the LLP, the Bond Trustee must serve a Notice to Pay on the LLP.
Summary of Priorities of PaymentsBelow is a summary of the Priorities of Payments. [Cross refer to section of the prospectus containing further information on this].ABCPrior to the occurrence of any of the events in columns B or C:From (and including) service of an Issuer Acceleration Notice, [an Asset Coverage Test Breach Notice (which has not been revoked)] or a Notice to Pay (prior to service of an LLP Acceleration Notice and/or realisation of the Security and/or commencement of windingup proceedings against the LLP):From (and including) the occurrence of an LLP Event of Default:Pre-Acceleration Priorities of PaymentsGuarantee Priority of PaymentsPost-Enforcement Priority of PaymentsRevenue PrincipalTrusteesPre-Maturity Liquidity Ledger, if the Pre-Maturity Test has been failedTrusteesSatisfaction of any expenses permitted by Regulations 27, 28 and/or 29 of the RCB Regulations to be paid in priority to the amounts identified as payable under item (ii) belowAgent Bank and Paying AgentsAcquisition of New Mortgage Loans to ensure compliance with the Asset Coverage TestAgent Bank and Paying AgentsPro rata and pari passu to:
Trustees
Agent Bank and Paying Agents
Senior expenses, e.g. Servicer, Cash Manager, LLP Account Bank, Corporate Services Provider
TRS Provider/Interest Rate Swap Provider/Basis Swap Provider
Covered Bond Swap Provider and Scheduled Interest and Scheduled Principal to the Bond Trustee or the Principal Paying AgentSenior expenses, for example, Servicer, Cash Manager, LLP Account Bank, Corporate Services Provider, Asset Monitor (excluding Indemnity Amounts)Deposit into LLP GIC Account to ensure compliance with the Asset Coverage TestSenior expenses, for example, Servicer, Cash Manager, LLP Account Bank, Corporate Services Provider, Asset Monitor (excluding Indemnity Amounts)Excluded Swap Termination AmountsPermitted unsecured creditors (such as the FSA, the Stock Exchange and the Rating Agencies)Payments of principal under the relevant Term Advance under the Intercompany Loan AgreementPermitted unsecured creditors (such as the FSA, the Stock Exchange and the Rating Agencies)Amounts outstanding under the Intercompany Loan AgreementTRS Provider/Interest Rate Swap Provider/Basis Swap Provider (other than Excluded Swap Termination Amounts)Capital Distribution to the Seller as a Member in the LLPTRS Provider/Interest Rate Swap Provider/Basis Swap Provider (other than Excluded Swap Termination Amounts)Indemnity amounts due to the Members
Non principal amounts to the Covered Bond Swap Provider; and
repayments under the Intercompany Loan AgreementInterest amounts to the Covered Bond Swap Provider and payment of scheduled interest in respect of the Covered BondsAny remaining moneys will be applied towards payment to the Members pursuant to the LLP DeedReserve Fund replenishment, if applicablePrincipal amounts to the Covered Bond Swap Provider and payment of scheduled principal in respect of the Covered BondsPre-Maturity Liquidity Ledger, if applicableDeposit into the LLP GIC Account to make the above payments on the following LLP Payment DatePayment into LLP GIC Account, if a Servicer Event of Default has occurredExcluded Swap Termination AmountsExcluded Swap Termination AmountsRepayment of advances under the Intercompany Loan Agreement (to the extent outstanding)Indemnity amounts due to:
the Members; and
the Asset MonitorIndemnity amounts due to the Members and the Asset MonitorProfits to MembersAny moneys left over to be applied in accordance with the LLP DeedDeferred consideration
Changes to Pre-Acceleration Priorities of Payment following service of an Asset Coverage Test Breach Notice (which has not been revoked)After service of an Asset Coverage Test Breach Notice (which has not been revoked) but prior to service of a Notice to Pay or an LLP Acceleration Notice, the LLP will apply Available Revenue Receipts and Available Principal Receipts as described in column A above subject to the following changed while any Covered Bonds remain outstanding:
in respect of Available Revenue Receipts, no amounts will be paid:
[to the Issuer under the Intercompany Loan Agreement set out in item 6(b) of column A above),
into the Reserve Fund (as set out in item 7 of column A above),
towards any indemnity amount due to the Members (as set out in item 11(a) of column A above) or any profit for the Members' interests in the LLP (as set out in item 12 of column A above); or
towards any Deferred Consideration (as set out in item 13 of column A above)]; and
[in respect of Available Principal Receipts, no payments will be made other than into the GIC Account[s] after exchange (if required) in accordance with the relevant Covered Bond Swap].
[Cross refer to section of the Prospectus containing further information on this.]Bank Accounts and Cash ManagementCollections of revenue and principal in respect of the Mortgage Loans in the Mortgage Portfolio are received by the Seller in its collection account. The majority of the interest payments and principal repayments are collected on [specify dates of the month]. The Seller (and, where relevant, the Servicer) is obliged to transfer collections in respect of the Mortgage Loans in the Mortgage Portfolio to the LLP GIC Account on a [daily/monthly] basis. On or prior to each LLP Payment Date, amounts will be transferred by the [Servicer/Cash Manager from the LLP GIC Account to the LLP Transaction Account to be applied in accordance with the relevant Priorities of Payments.Summary of key Swap TermsThe [TRS/Interest Rate Swap/Basis Swap] has the following key commercial terms:
Swap Notional Amount: []
Issuer payment: []
Interest Rate/Basis Swap Provider payment: []
Frequency of payment: []
[If applicable] [The Covered Bond Swap [has/will have] the following key commercial terms:
Swap Notional Amount: []
Exchange rate: []
Issuer payment: []
Currency Swap Provider payment: []
Frequency of payment: []][Please set out any other key features of the credit structure particular for this transaction which are not described in this section]
TRIGGERS TABLES
Rating Triggers Table Transaction Parties
Transaction Party:Required Ratings/Triggers:Possible effects of Trigger being breached include the following:Issuer
[Describe rating trigger][Establish and maintain Reserve Fund][Describe rating trigger][Impact on component "X" of Asset Coverage Test][Describe rating trigger][Breach of the Pre-Maturity Test]The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].Seller/Originator[Describe rating triggers for Perfection Events]. Perfection Event takes place and legal title to the Mortgage Loans to be transferred to the LLP
The consequences of the relevant required rating being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this]. The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].Basis/Interest Rate/TRS Swap Provider[Describe rating trigger][providing collateral for its obligations]; or
[arranging for its obligations under the relevant Swap Agreement to be transferred to an entity with the required ratings]; or
[procuring a guarantee of its obligations], or
[Summarise others][Describe rating trigger]Posting of collateral in accordance with the relevant credit support documentThe consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].Covered Bond Swap Provider[Describe rating trigger][providing collateral for its obligations]; or
[arranging for its obligations under the relevant Swap Agreement to be transferred to an entity with the required ratings]; or
[procuring a guarantee of its obligations], or
[Summarise others][Describe rating trigger]Posting of collateral in accordance with the relevant credit support documentThe consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].LLP Account Bank[Describe rating trigger][Replacement of LLP Account Bank]
[Guarantee of LLP Account Bank's obligations]
[Summarise others]The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].GIC Provider[Describe rating trigger][Replacement of GIC Provider]
[Guarantee of GIC Provider's obligations]
[Summarise others]The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].Servicer[Describe rating trigger][Substitute Servicer appointed]
[Servicer appointment terminated and Standby Servicer steps in][If this item is applicable, please specify when standby Servicer would take over]
[Summarise others]The consequences of the relevant required rating being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
Cash Manager[Describe rating trigger][Establishment of back-up cash management arrangements]
[Pre-funding payment obligations]
[The Asset Monitor will be required to conduct more frequent tests of the Cash Manager's calculations]
[Summarise others]The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].[Stand-by Swap Provider][Describe rating trigger/termination event (e.g. termination of the relevant swap on payment default of the relevant Swap Provider][The Standby Swap will become effective and payments due under the Standby Swap will be the same in all material respects to those under the relevant Swap Agreement]
[Summarise others]The consequences of the relevant required ratings being breached are set out in more detail in [cross refer to section of the Prospectus containing further information on this].
[Specify time periods within which remedial action is required to be taken].
Non-Rating Triggers Table
Nature of Trigger:Description of Trigger:Consequence of Trigger:Interest Rate Shortfall Test[To be described] [Cross refer to section of Prospectus containing more information on this]Further Mortgage Loans and their Related Security may be required to be sold to the LLPYield Shortfall Test[To be described] [Cross refer to section of Prospectus containing more information on this]Servicer to take necessary steps to increase the Standard Variable Rate and/or other discretionary rates or margins
Asset Coverage Test[To be described] [Cross refer to section of Prospectus containing more information on this][Breach of the Asset Coverage Test which is not remedied on the next Calculation Date requires the Bond Trustee to serve an Asset Coverage Test Breach Notice on the LLP. If this breach is remedied by the [third] Calculation Date after the service of such notice, it will lead to an Issuer Event of Default] [or]
[Breach of the Asset Coverage Test for two consecutive months leads to Issuer Event of Default]Issuer Event of Default[To be described] [Cross refer to section of Prospectus containing more information on this]Covered Bonds become accelerated as against the Issuer (but not against the LLP)
Notice to Pay served on the LLP
Following service of Notice to Pay, LLP starts making payments of Guaranteed Amounts under the Covered BondsAmortisation Test [To be described] [Cross refer to section of Prospectus containing more information on this]Breach of the Amortisation Test for two consecutive months leads to an LLP Event of DefaultPre-Maturity Liquidity Test[To be described] [Cross refer to section of Prospectus containing more information on this]Notice to Pay served on the LLP following a breach of the PreMaturity Test, if certain actions are not taken within a specified period[Others to be specified][To be described][To be described]
FEES
The table below sets out the principal on-going transaction fees.
Type of FeeAmount of FeePriority in CashflowFrequencyServicing Fees[][] (inclusive of VAT)Ahead of all outstanding Covered Bonds*[]Cash Management Fees : d |
İĜt`I`I`I`8 h"6 hP CJ OJ QJ ^J aJ ,h"6 h~m 56CJ OJ QJ \]^J aJ &h"6 h~m 5CJ OJ QJ \^J aJ &h"6 h%E 5CJ OJ QJ \^J aJ &h"6 h, 5CJ OJ QJ \^J aJ &h"6 hS] 5CJ OJ QJ \^J aJ &h"6 hA+ 5CJ OJ QJ \^J aJ &h"6 hrj 5CJ OJ QJ \^J aJ &h"6 h*>. 5CJ OJ QJ \^J aJ &h"6 hw1 5CJ OJ QJ \^J aJ
p r : $If gd~m $If gdt $ a$gdP $ a$gd~m $a$gd%E $a$gdj\"
6 l r . 0 L X Z t v ʶziiO=OiO=Oi #h"6 h
? CJ OJ QJ ^J aJ 2j h"6 h
? 5CJ OJ QJ U\^J aJ h"6 h\ CJ OJ QJ ^J aJ &h"6 hA+ 5CJ OJ QJ \^J aJ &h"6 h\ 5CJ OJ QJ \^J aJ &h"6 h
? 6CJ OJ QJ ]^J aJ &h"6 hP 6CJ OJ QJ ]^J aJ h"6 hP CJ OJ QJ ^J aJ &h"6 hn 6CJ OJ QJ ]^J aJ h"6 hn CJ OJ QJ ^J aJ
6
>
B
D
N
P
R
8 < T . ò|kZI5k &h"6 h~m 5CJ OJ QJ \^J aJ h"6 hA+ CJ OJ QJ ^J aJ h"6 hX= CJ OJ QJ ^J aJ h"6 h~m CJ OJ QJ ^J aJ &h"6 h
? 6CJ OJ QJ ]^J aJ h"6 h.w CJ OJ QJ ^J aJ h"6 hpB CJ OJ QJ ^J aJ h"6 hn CJ OJ QJ ^J aJ h"6 h\ CJ OJ QJ ^J aJ #h"6 h
? CJ OJ QJ ^J aJ 2j h"6 h
? 5CJ OJ QJ U\^J aJ : < T x o $If gd( $If gdL\F } kd $$If l 0 5&