Document:

ex4_6.htm

 Exhibit 4.6 

 

 

 

 

 

 ROYAL BANK OF CANADA 

  

 Global Covered Bond Programme 

 

 

 

 _______________________ 

 

 AMENDED AND RESTATED AGENCY AGREEMENT 

 _______________________ 

 

 

 

 

 Dated as of 

 June 29, 2012 

 

 

 

 

 Norton Rose Canada LLP 

 Toronto/London 

 

 

 

 Norton Rose LLP 

 London 

 

 

 

 McCarthy Tétrault LLP 

 London/Toronto 

 

    

    

    

 

 TABLE OF CONTENTS

 

 

	   	   	 Page No. 
	   	   	   
	
 Section 1. 

	
 Interpretation 

	
 4 

	
 Section 2. 

	
 Appointment of Agents 

	
 8 

	
 Section 3. 

	
 Issuance of Covered Bonds 

	
 11 

	
 Section 4. 

	
 Replacement Covered Bonds 

	
 19 

	
 Section 5. 

	
 Determination of End of Distribution Compliance Period 

	
 20 

	
 Section 6. 

	
 Payments to the Issuing and Paying Agent or the Registrar 

	
 21 

	
 Section 7. 

	
 Payments to Holders of Bearer Covered Bonds 

	
 23 

	
 Section 8. 

	
 Payments to Holders of Registered Covered Bonds 

	
 25 

	
 Section 9. 

	
 Miscellaneous Duties of the Issuing and Paying Agent and the Paying Agents 

	
 28 

	
 Section 10. 

	
 Early Redemption and Exercise of Options 

	
 32 

	
 Section 11. 

	
 The Register and Miscellaneous Duties of the Registrar 

	
 33 

	
 Section 12. 

	
 Other Duties of the Transfer Agents and the Exchange Agent 

	
 36 

	
 Section 13. 

	
 Appointment and Duties of the Calculation Agent 

	
 37 

	
 Section 14. 

	
 Fees and Expenses 

	
 38 

	
 Section 15. 

	
 Terms of Appointment 

	
 39 

	
 Section 16. 

	
 Changes in Agents 

	
 40 

	
 Section 17. 

	
 The Bond Trustee 

	
 44 

	
 Section 18. 

	
 Notices 

	
 44 

	
 Section 19. 

	
 Governing Law 

	
 46 

	
 Section 21. 

	
 Modification 

	
 46 

	
 Section 22. 

	
 Non-Petition 

	
 47 

	
 Section 23. 

	
 No Indirect Damages 

	
 47 

	
 Section 24. 

	
 Counterparts 

	
 47 

	
 Section 26. 

	
 Force Majeure 

	 47 

 

	
 SCHEDULES 

 THE FIRST SCHEDULE Form of Transfer Certificate 

 THE SECOND SCHEDULE Regulations concerning Transfers of Registered Covered Bonds (other than N Covered Bonds) 

 THE THIRD SCHEDULE The Specified Offices of the Paying Agents, the Registrars, the Transfer Agents, the Exchange Agent and the Calculation Agent 

 THE FOURTH SCHEDULE Calculation Agent Appointment Letter 

 THE FIFTH SCHEDULE Duties under the Issuer-ICSDs Agreement 

 

    

    

    

 

 THIS AGENCY AGREEMENT initially made the 25th day of October, 2007 and amended and restated on this 29th day of June, 2012. 

 

 BETWEEN: 

 

 (1)           Royal Bank of Canada (the “Issuer”); 

 

	
 (2) 

	
 RBC Covered Bond Guarantor Limited Partnership, herein represented by its managing general partner, RBC Covered Bond GP Inc. (the “Guarantor LP”); 

 

	
 (4) 

	
 Bank of New York Mellon, London Branch, in its capacities as Issuing and Paying Agent (the “Issuing and Paying Agent”, which expression shall include any successor to Bank of New York Mellon, London Branch, in its capacity as such), Calculation Agent (as defined herein) and as transfer agent (together with any substitute or additional transfer agents appointed in accordance herewith the “Transfer Agents”, which expression shall, unless the context otherwise requires, include the European Registrar, the Canadian Registrar and the U.S. Registrar); 

 

	
 (5) 

	
 The Bank of New York Mellon (Luxembourg) S.A., in its capacities as European registrar (the “European Registrar”, which expression shall include any successor to The Bank of New York Mellon (Luxembourg) S.A., in its capacity as such; 

 

	
 (6) 

	
 BNY Trust Company of Canada, acting through its offices located at 320 Bay Street 11th Floor, Toronto, Ontario, Canada, M5H 4A6, in its capacity as Canadian registrar (the “Canadian Registrar”, which expression shall include any successor in this capacity) and as transfer agent; 

 

	
 (7) 

	
 The Bank of New York Mellon, a New York banking corporation, in its capacities as U.S. registrar (the “U.S. Registrar”, which expression shall include any successor in this capacity), transfer agent and exchange agent (the “Exchange Agent”, which expression shall include any successor in this capacity and any substitute or additional Exchange Agent appointed in accordance herewith) and U.S. paying agent (the “U.S. Paying Agent”, which expression shall include any successor in this capacity, and together with the Issuing and Paying Agent and any substitute or additional paying agents appointed in accordance herewith the “Paying Agents”); and 

 

	
 (8) 

	
 Computershare Trust Company of Canada (the “Bond Trustee”, which expression shall include all person for the time being the bond trustee or the bond trustees under the Trust Deed). 

 

 WHEREAS: 

 

 (A)           The Issuer has established a programme (the “Programme”) for the issuance of Covered Bonds (the “Covered Bonds”); 

 

 (B)           In connection with the Programme, the Issuer has entered into the Dealership and Underwriting Agreements; 

 

    

 -3- 

    

 

 (C)           The Issuer, the Guarantor LP, the Bond Trustee, Royal Bank of Canada, London branch, The Bank of New York Mellon, ING Belgium S.A./N.V., Royal Bank of Canada (Suisse) and Fortis Banque Luxembourg S.A. entered into an agency agreement dated October 25, 2007, as the same was most recently amended and restated by agreement dated April 6, 2011 (as amended, the “Prior Amended and Restated Agency Agreement”) between the Issuer, the Guarantor LP, the Bond Trustee, Royal Bank of Canada, London branch and The Bank of New York Mellon and the same was amended by a novation agreement dated October 7, 2011 between the parties hereto and Royal Bank of Canada, London branch, all to record certain arrangements which they made in relation to the Covered Bonds to be issued under the Programme; 

 

 (D)           ING Belgium S.A./N.V., Royal Bank of Canada (Suisse), Fortis Banque Luxembourg S.A. and Royal Bank of Canada, London Branch have ceased to be Paying Agents, and Royal Bank of Canada, London branch has ceased to be Transfer Agent and European Registrar, and Royal Bank of Canada has ceased to be Canadian Registrar and Transfer Agent in respect of any Covered Bonds issued under the Programme; and 

 

 (E)            The parties desire to amend and restate in its entirety the terms the Prior Amended and Restated Agency Agreement by entering into this Agreement, such amendment and restatement having been made in accordance with Section 20 of the Prior Amended and Restated Agency Agreement. 

 

 IT IS AGREED as follows: 

 

 Section 1.         Interpretation 

 

	
 1.01 

	
 In this Agency Agreement, any reference to: 

 

 “Agents” means each of the Issuing and Paying Agent, European Registrar, Transfer Agents, Canadian Registrar, U.S. Registrar, Exchange Agents and Paying Agents; 

 

 “Agency Agreement” or this “Agreement” means this amended and restated agency agreement dated June 29, 2012, as the same may be amended, restated, or supplemented from time to time by written agreement of the parties hereto; 

 

 “Authorised Person” means any person who is designated by the Issuer in writing from time to time to give instructions to the Agents; 

 

 “Canadian Dealers” means persons appointed as dealers pursuant to the terms of a Canadian Dealership Agreement; 

 

 “Canadian Dealer Agreement” means any  dealer agreement entered into pursuant to the terms of the Dealership Agreement  to solicit, from time to time, offers to purchase Covered Bonds in Canada, in accordance with such dealer agreement,  as the same may be amended, supplemented or replaced; 

 

 “Canadian Prospectus” means the short form base shelf prospectus of the Bank, in both English and French, dated October 21, 2011, including at any time the documents or information incorporated or deemed to be incorporated by reference therein, subject to and to the extent that prospectus supplements, in both English and French, have been filed providing for a continuous offering of Covered Bonds under the Covered Bond Programme during the period that such base shelf prospectus remains effective in accordance with National Instrument 44-102 - Shelf Distributions of the Canadian Securities Administrators, and includes such filed prospectus supplements. 

 

    

 -4- 

    

 

 “Calculation Agent” means, in relation to any Series of Covered Bonds, the institution appointed as calculation agent for the purposes of such Covered Bonds and named as such in the applicable Final Terms, in the case of the Issuing and Paying Agent, pursuant to Section 13, in the case of a Global Dealer or Canadian Dealer, pursuant to Section 4 of the Dealership Agreement and, in the case of any other institution or U.S. Dealer, pursuant to a letter of appointment in, or substantially in, the form set out in the Fourth Schedule and, in any case, any successor to such institution in its capacity as such; 

 

	
    

	
 a “Clause” is, unless the context indicates otherwise, to a clause in a Section hereof; 

 

	
    

	
 “Code” means the U.S. Internal Revenue Code of 1986; 

 

 “Dealers” means the Global Dealers, the U.S. Dealer(s) and the Canadian Dealers; 

 

	
    

	
 “Dealership and Underwriting Agreements” means the Dealership Agreement, any Canadian Dealership Agreement and the Underwriting Agreement; 

 

	
    

	
 “Dealership Agreement” means the amended and restated dealership agreement initially dated as of October 25, 2007 and most recently amended and restated on April 6, 2011, made between Royal Bank of Canada Europe Limited, RBC Capital Markets Corporation, Barclays Bank PLC, BNP Paribas, London Branch and Commerzbank Aktiengesellschaft London Branch, as dealers, and the Issuer and the Guarantor LP, as the same may be further amended, supplemented or replaced from time to time; 

 

	
    

	
 “Delivery Agent” means, in relation to any Series of Covered Bonds that contemplates physical settlement, the financial institution appointed as delivery agent for the purposes of such Covered Bonds and named as such in the applicable Final Terms; 

 

	
    

	
 “Global Dealers” means the persons party to the Dealership Agreement, as dealers, including any substitute or additional dealers appointed in accordance with the Dealership Agreement; 

 

	
    

	
 “Eurosystem-eligible Covered Bond” means a NGCB or a Registered Global Covered Bond that is to be held under the NSS, as stated in the applicable Pricing Supplement or Stand-Alone Prospectus; 

 

	
    

	
 “FATCA Withholding Tax” means any withholding  or deduction required pursuant to an agreement described in Section 1471(b) of the Code or any withholding or deduction otherwise imposed pursuant to Sections 1471 through 1474 of the Code and any regulations or agreements thereunder or official interpretations thereof; 

 

    

 -5- 

    

 

	
    

	
 “FFI” means a “foreign financial institution” as such term is defined pursuant to Sections 1471 through 1474 of the Code and any regulations thereunder or official interpretations thereof; 

 

	
    

	
 “ICSD” means Euroclear and/or Clearstream, Luxembourg; 

 

	
    

	
 “Issuer-ICSDs Agreement” means the agreement entered into between the Issuer and each of the ICSDs; 

 

	
    

	
 “local time” in relation to any payment, is to the time in the city or town in which the relevant bank or the relevant branch or office thereof is located, and any reference to “local banking days” in relation thereto is to days other than Saturdays and Sundays on which commercial banks are open for general business, including dealings in foreign exchange and foreign currency deposits, in such city or town; 

 

	
    

	
 “London business day” means a day other than a Saturday or Sunday on which commercial banks and foreign exchange markets are open for general business, including dealings in foreign exchange and foreign currency deposits, in London; 

 

	
    

	
 “Losses” means any and all claims, losses, liabilities, damages, costs, expenses and judgements (including properly incurred legal fees and expenses) sustained by the Agents; 

 

 “N Covered Bond Assignment Agreement” means the assignment agreement substantially in the form attached to the relevant N Covered Bond delivered in accordance with the Conditions in respect of the relevant N Covered Bond; 

 

	
    

	
 “NSS” means the new safekeeping structure for registered global securities which are intended to constitute eligible collateral for Eurosytem monetary policy and intra-day credit operations; 

 

	
    

	
 “Participating FFI” means an FFI that has an agreement described in Section 1471(b) of the Code and any regulations thereunder or official interpretations thereof) in full force and effect as from the effective date of withholding on any “passthru payments” (as such term is defined pursuant to Sections 1471 through 1474 of the Code and any regulations thereunder or official interpretations thereof); 

 

 “Prospectus” means a prospectus prepared in connection with the Programme and approved by the UK Listing Authority, and constituting in the case of Covered Bonds to be listed on a Stock Exchange to the extent specified in such prospectus the Listing Particulars, as revised, supplemented or amended from time to time by the Issuer and the Guarantor LP including any documents which are from time to time incorporated in the Prospectus by reference except that in relation to each Tranche of Covered Bonds only, the applicable Final Terms shall be deemed to be included in the Prospectus; 

 

 “Registrars” means the European Registrar, the Canadian Registrar and the U.S. Registrar and any substitute or additional registrars appointed in accordance with the Agency Agreement and “Registrar” means, in relation to any particular Covered Bonds in registered form, those Registrar(s) specified in the applicable Final Terms; 

 

    

 -6- 

    

 

 “Regulated Market” means a regulated market for the purposes of the Markets in Financial Instruments Directive; 

 

 “Relevant Dealer” means (i) each Dealer party to an agreement whether oral or in writing with the Issuer and the Guarantor LP for the sale by the Issuer and purchase or, as the case may be, subscription as principal, by such Dealer or on such other basis as may be agreed between the Issuer and Guarantor LP and such Dealer, at the relevant time, of any Covered Bonds; and (ii) if no such agreement has been entered into at a relevant time in respect of any Covered Bonds, the each Dealer named as such in the Final Terms in respect of such Covered Bonds; 

 

 a “Schedule” is, unless the context indicates otherwise, to a schedule hereto which, for greater certainty, forms part of this Agreement; 

 

	
    

	
 a “Section” is, unless the context indicates otherwise, to a section hereof; 

 

	
    

	
 the “specified office” of any Agent or Calculation Agent is to the office specified against its name in the Third Schedule or, in the case of any Agent or Calculation Agent not originally party hereto, specified in its terms of appointment (or, in the case of a Calculation Agent which is a Dealer, specified for the purposes of Section 6 of the Dealership Agreement) or such other office in the same metropolitan area as such Agent or, as the case may be, such Calculation Agent may specify by notice to the Issuer and the other parties hereto in accordance with Clause 16.08; and 

 

	
    

	
 “Transfer Certificate” means a certificate in the form set out in the First Schedule. 

 

 “Underwriting Agreement” means an underwriting agreement in respect of the sale of Covered Bonds in the United States pursuant to the U.S. Registration Statement, to be entered into in July 2012, between RBC Capital Markets, LLC, as dealer, and the Issuer and the Guarantor LP, as the same may be further amended, supplemented or replaced from time to time; 

 

 “U.S. Dealer(s)” means the person(s) party to the Underwriting Agreement, as agents, including any each person appointed as an agent pursuant to the terms of the Underwriting Agreement; 

 

 “U.S. Prospectus” means the prospectus included in the U.S. Registration Statement, as revised, supplemented or amended from time to time by the Issuer and the Guarantor LP including any documents which are from time to time incorporated in the U.S. Prospectus by reference except that in relation to each tranche of Covered Bonds only, the applicable pricing supplement shall be deemed to be included in the U.S. Prospectus; 

 

 “U.S. Registration Statement” means a registration statement on Form F-3 (File No: 333-181552) in respect of certain issuances of covered bonds to be registered with the United States Securities and Exchange Commission, as revised, supplemented or amended from time to time; 

 

    

 -7- 

    

 

 1.02    The Master Definitions and Construction Agreement made between the parties to the Transaction Documents on the Programme Establishment Date and most recently amended and restated on June 29, 2012 (as the same may be amended, varied, supplemented or amended and restated from time to time with the consent of the parties thereto) is expressly and specifically incorporated into this Agreement and, accordingly, the expressions defined in the Master Definitions and Construction Agreement 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 Section 2 of the Master Definitions and Construction Agreement. In the event of inconsistency between the Master Definitions and Construction Agreement and this Agency Agreement, this Agency Agreement shall prevail. 

 

 1.03    Section and Schedule headings are for ease of reference only and shall not affect the construction or interpretation of this Agreement. 

 

 1.04    In this Agreement, any reference to payments of principal or interest includes any additional amounts payable in relation thereto under the Conditions. 

 

 1.05    In this Agreement, any reference to Euroclear and/or Clearstream, Luxembourg, CDS, and/or DTC shall, wherever the context so permits (other than in relation to a Eurosystem-eligible Covered Bond), be deemed to include a reference to any other clearing system agreed as is approved by the Issuer, the Issuing and Paying Agent and the Bond Trustee or as may otherwise be specified in the applicable Final Terms. 

 

 1.06    In this Agreement, any reference to the “records” of an ICSD, DTC or CDS, shall be to the records that each of the ICSDs, DTC and CDS holds for its customer which reflect the amount of such customer’s interest in the Covered Bonds (but excluding any interest in any Covered Bonds of one of the ICSDs, DTC or CDS, as applicable, shown in the records of any other of the ICSDs, DTC or CDS, as applicable). 

 

 1.07    All references herein to Covered Bonds having a “listing” or being “listed” on a Stock Exchange shall (i) in relation to the London Stock Exchange, be construed to mean that such Covered Bonds have been admitted to the Official List by the UK Listing Authority and admitted to trading on either the Market or the PSM or (ii) in relation to any Stock Exchange in the EEA (other than the London Stock Exchange), be construed to mean that such Covered Bonds have been admitted to trading on a Regulated Market or (iii) to any other Stock Exchange (other than those referred to in (i) and (ii) above), be construed to mean that the Covered Bonds have been listed on that Stock Exchange and/or to trading on the relevant market, as the case may be, and all references in the trust presents to “listing” and “listed” shall include references to “quotation” and “quoted” respectively. 

 

 Section 2.         Appointment of Agents 

 

 2.01    The Issuer and Guarantor LP (and, for the purposes only of sub-clause 2.06 below, the Bond Trustee) appoints: 

 

	   	
 (a) 

	
 Bank of New York Mellon, London Branch, as its Issuing and Paying Agent, exchange agent and transfer agent; 

 

	   	
 (b) 

	
 The Bank of New York Mellon (Luxembourg) S.A., as its European Registrar; 

 

    

 -8- 

    

 

	   	
 (c) 

	
 BNY Trust Company of Canada, acting through its offices located at 320 Bay Street 11th Floor, Toronto, Ontario, Canada, M5H 4A6, as its Canadian Registrar; and 

 

	   	
 (d) 

	
 The Bank of New York Mellon at its specified office as its U.S. Registrar, U.S. paying agent, transfer agent and exchange agent; 

 

 each for the purposes specified in this Agreement and in the Conditions and all matters incidental thereto. 

 

 2.02    Each of the Agents accepts its appointment as agent of the Issuer and Guarantor LP (and for the purposes only of sub-clause 2.06 below, the Bond Trustee) in relation to the Covered Bonds and shall perform all matters expressed to be performed by it in, and otherwise comply with, the Conditions and the provisions of this Agreement and, in connection therewith, shall take all such action as may be incidental thereto.  Each of the Agents appointed hereunder shall use commercially reasonable efforts to perform its obligations hereunder, including the timely taking of action as required hereunder; provided, however, that each of the Agents shall not be liable for its failure to meet such deadlines, including, without limitation, with respect to Paying Agents deadlines for the payment of money to owners of the Covered Bonds, except such failure as shall result from its own negligence or willful misconduct. 

 

 2.03    In acting under this Agreement and in connection with the Covered Bonds, the Agents shall act solely as agent(s) of the Issuer and will not assume any obligation or responsibility towards or relationship or agency or trust for or with any of the owners or holders of Covered Bonds or any other third party. 

 

 2.04    In relation to each issue of Eurosystem–eligible Covered Bonds, the Issuer hereby authorises and instructs the Issuing and Paying Agent or the European Registrar, as the case may be, to elect Euroclear as Common Safekeeper. From time to time the Issuer and the Issuing and Paying Agent or European Registrar may agree to vary this election. The Issuer acknowledges that any such election is subject to the right of Euroclear and Clearstream, Luxembourg to jointly determine that the other shall act as Common Safekeeper in relation to any such issue and agrees that no liability shall attach to the Issuing and Paying Agent or the European Registrar in respect of any election made by it. 

 

 2.05    In relation to each Series of Covered Bonds where the Issuing and Paying Agent agrees to act as Delivery Agent for any Covered Bonds issued under the Programme that are payable and/or dischargeable by the Issuer by the payment or delivery of securities and/or other property or any combination of cash, securities and/or property, it is hereby appointed as Delivery Agent of the Issuer, upon the terms and subject to the conditions set out below, for the purpose of performing the obligations and duties imposed upon it by the relevant Conditions and this Agreement.  For the avoidance of doubt, the Issuing and Paying Agent shall have the right to decline to act as a Delivery Agent whereupon the Issuer shall either (i) act as Delivery Agent or (ii) engage another financial institution to act as Delivery Agent in respect of such Covered Bonds. 

 

	   	
 (a) 

	
 At any time after an Issuer Event of Default or Potential Issuer Event of Default shall have occurred and is continuing or the Bond Trustee shall have received any money from the Issuer which it proposes to pay under Clause 11 to the relevant Covered Bondholders, Receiptholders and/or Couponholders, the Bond Trustee may: 

 

    

 -9- 

    

 

	   	
 (i) 

	
 by notice in writing to the Issuer, Guarantor LP, the Agents, require the Agents pursuant to the Agency Agreement to act thereafter as Agents respectively of the Bond Trustee in relation to payments of such moneys to be made by or on behalf of the Bond Trustee under the terms hereof mutatis mutandis on the terms provided in the Agency Agreement (save that the Bond Trustee’s liability under any provisions thereof for the indemnification, remuneration and payment of out of pocket expenses of the Agents shall be limited to the amounts for the time being held by the Bond Trustee on the trusts hereof relating to the Covered Bonds of the relevant Series and available for such purpose) and thereafter to hold all Covered Bonds, Receipts and Coupons and all sums, documents and records held by them in respect of Covered Bonds, Receipts and Coupons on behalf of the Bond Trustee; or 

 

	   	
 (ii) 

	
 by notice in writing to the Issuer require it (but not the Guarantor LP) to make all subsequent payments in respect of the Covered Bonds, Receipts and Coupons to or to the order of the Bond Trustee and not to the Issuing and Paying Agent or Registrar, as the case may be, and with effect from the issue of any such notice to the Issuer and until such notice is withdrawn proviso (a) to sub clause 2.2 of this Clause relating to the Covered Bonds shall cease to have effect in respect of the Issuer. 

 

	   	
 (b) 

	
 At any time after an Guarantor LP Event of Default or Potential Guarantor LP Event of Default shall have occurred and is continuing or the Bond Trustee shall have received any money from the Guarantor LP which it proposes to pay under Clause 11 to the relevant Covered Bondholders, Receiptholders and/or Couponholders, the Bond Trustee may: 

 

	   	
 (i) 

	
 by notice in writing to the Issuer, Guarantor LP, the Issuing and Paying Agent and the other Paying Agents require the Issuing and Paying Agent and the other Paying Agents or the Registrar, as the case may be, pursuant to the Agency Agreement to act thereafter as Agents respectively of the Bond Trustee in relation to payments of such moneys to be made by or on behalf of the Bond Trustee under the terms hereof mutatis mutandis on the terms provided in the Agency Agreement (save that the Bond Trustee’s liability under any provisions thereof for the indemnification, remuneration and payment of out of pocket expenses of the Agents shall be limited to the amounts for the time being held by the Bond Trustee on the trusts hereof relating to the Covered Bonds of the relevant Series and available for such purpose) and thereafter to hold all Covered Bonds, Receipts and Coupons and all sums, documents and records held by them in respect of Covered Bonds, Receipts and Coupons on behalf of the Bond Trustee; or 

 

	   	
 (ii) 

	
 by notice in writing to the Guarantor LP require it to make all subsequent payments in respect of the Covered Bonds, Receipts and Coupons to or to the order of the Bond Trustee and not to the Issuing and Paying Agent or the Registrar, as the case may be, and with effect from the issue of any such notice to the Guarantor LP and until such notice is withdrawn proviso (a) to sub clause 2.2 of this Clause relating to the Covered Bonds shall cease to have effect. 

 

    

 -10- 

    

 

 2.07    Any Agent may, at any time, appoint a sub-agent or delegate by power of attorney or otherwise to any person for any period, all or any of the rights, powers and discretions vested in such Agent by this Agreement. The appointment or delegation shall be made on the same terms as this Agreement (including the power to sub-delegate) and, provided that it has exercised due care in the selection of such sub-agent, delegate or sub-delegate, such Agent shall not be bound to monitor, oversee or supervise, or be in any way responsible for any liability incurred by reason of any misconduct or default on the part of any sub-agent, delegate or sub-delegate which is not an affiliate of The Bank of New York Mellon. 

 

 2.08    In no event shall any Agent be liable for any Losses arising as a result of an Agent receiving or transmitting any data from or to an Authorised Person via any non-secure method of transmission or communication, such as but without limitation, by facsimile or email. The Issuer accepts that some methods of communication are not secure and the Agents shall not incur any liability for receiving instructions via any such non-secure method. The Agents are authorised to comply with and rely upon any such notice, instruction or other communications believed by them to have been sent or given by an Authorised Person. The Issuer shall use all reasonable endeavours to ensure that instructions transmitted to the Agents pursuant to this Agreement are complete and correct. Any instructions transmitted shall be conclusively deemed to be valid instructions from the Issuer to the Agents for the purposes of this Agreement. 

 

 Section 3.         Issuance of Covered Bonds 

 

 3.01    Upon the conclusion of any Relevant Agreement (as defined in the Dealership Agreement), or the Issuer having accepted an offer to purchase Covered Bonds pursuant to the Underwriting Agreement (including any Terms Agreement (as defined in the Underwriting Agreement)) the Issuer shall as soon as practicable, but in any event not later than 2.00 p.m. (London time) on the third (or, in the case of Clause 3.01(b) on the second) Banking Day prior to the proposed Issue Date: 

 

	   	
 (a) 

	
 confirm by tested fax or email to the Issuing and Paying Agent or, if such Covered Bonds are to be Registered Covered Bonds (other than N Covered Bonds), the European Registrar, the Canadian Registrar or U.S. Registrar (copied to the Issuing and Paying Agent), all such information as the Issuing and Paying Agent or, as the case may be, the Registrar may reasonably require to carry out its functions under this Agreement and in particular, whether customary eurobond or medium term note settlement and payment procedures will apply to the relevant Tranche and, if a master Global Covered Bond is/are to be used, such details as are necessary to enable it to complete a duplicate or duplicates of the master Global Covered Bond and (if medium term note settlement and payment procedures are to apply) the account of the Issuer to which payment should be made, provided that, in the case of a confirmation by email such confirmation shall be confirmed forthwith by post unless a return email acknowledging receipt is received by the sender; 

 

    

 -11- 

    

 

	   	
 (b) 

	
 deliver a copy, of the Final Terms, duly executed (if applicable), in relation to the relevant Tranche to the Issuing and Paying Agent or, as the case may be, the Registrar (copied to the Issuing and Paying Agent); and 

 

	   	
 (c) 

	
 unless a master Global Covered Bond is to be used and the Issuer shall have provided such document to the Issuing and Paying Agent or, as the case may be, the Registrar pursuant to Clause 3.02, ensure that there is delivered to the Issuing and Paying Agent an appropriate Bearer Global Covered Bond (in unauthenticated and, where applicable uneffectuated form, but executed on behalf of the Issuer and otherwise complete) or, as the case may be, to the Registrar a stock of Registered Global Covered Bonds (in unauthenticated and, where applicable uneffectuated form, and with the names of the registered Holders left blank but executed on behalf of the Issuer and otherwise complete) in relation to the relevant Tranche. 

 

 3.02    The Issuer may, at its option, deliver from time to time to the Issuing and Paying Agent a stock of master Temporary Global Covered Bonds and master Permanent Global Covered Bonds (in unauthenticated and, where applicable uneffectuated form but executed on behalf of the Issuer) and/or, to the Registrar, master Registered Global Covered Bonds and N Covered Bonds (in unauthenticated and, where applicable uneffectuated form, but executed on behalf of the Issuer). 

 

 3.03    Where the relevant Covered Bonds are to be listed on the London Stock Exchange and where permitted by applicable legislation or stock exchange rules (including the Listing Rules), upon receipt of express instructions from the Issuer, the Issuing and Paying Agent or, as the case may be, the European Registrar shall, on behalf of the Issuer, deliver a copy of the Pricing Supplement to the UK Listing Authority and to the London Stock Exchange as soon as practicable but in any event not later than 2.00 p.m. (London time) on the London business day prior to the proposed Issue Date therefor.  Subject to the foregoing, the Issuer confirms to the Issuing and Paying Agent that it has submitted to the London Stock Exchange and the UK Listing Authority, a letter of appointment (which remains current) designating the Issuing and Paying Agent as authorised to submit the Pricing Supplement to the UK Listing Authority and to the London Stock Exchange on behalf of the Issuer. 

 

 3.04    Subject to Clause 3.09, where the relevant Covered Bonds are Bearer Covered Bonds and the relevant Bearer Global Covered Bond is a CGCB, on or before 10.00 a.m. (London time) on the Banking Day prior to the Issue Date in relation to each Tranche, the Issuing and Paying Agent shall authenticate and deliver the relevant Bearer Global Covered Bond(s) to the relevant common depositary for Euroclear and/or Clearstream, Luxembourg (or otherwise, at such time, on such date, to such person and in such place as may have been agreed between the Issuer, the Relevant Dealer and the Issuing and Paying Agent).  The Issuing and Paying Agent shall give instructions to Euroclear and/or Clearstream, Luxembourg to credit Covered Bonds represented by a Bearer Global Covered Bond to the Issuing and Paying Agent’s distribution account and to hold each such Covered Bond to the order of the Issuer pending delivery to the Relevant Dealer(s) on a delivery against payment basis (or on such other basis as shall have been agreed between the Issuer and the Relevant Dealer and notified to the Issuing and Paying Agent) in accordance with the normal procedures of Euroclear and/or Clearstream, Luxembourg, as the case may be and, following payment, to credit the Covered Bonds represented by such Bearer Global Covered Bond to such securities account(s) as shall have been notified to the Issuing and Paying Agent by the Issuer.  The Issuing and Paying Agent shall, on the Issue Date in respect of the relevant Tranche and against receipt of funds from the Relevant Dealer(s), transfer the proceeds of issue to the Issuer to the account notified in accordance with Clause 3.01 above. 

 

    

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 If no such securities account(s) shall have been specified, the Issuing and Paying Agent shall authenticate and make available at its specified office on the Issue Date in respect of the relevant Tranche the relevant Bearer Global Covered Bond. 

 

 3.05    Where the relevant Covered Bonds are to be initially represented by a Registered Global Covered Bond, on or before 10.00 a.m. local time on the Banking Day prior to the Issue Date (or on the Issue Date in the case of a Registered Global Covered Bond noted in (b) below) in relation to each Tranche, the Registrar shall authenticate and deliver: 

 

	   	
 (a) 

	
 in the case of a Registered Global Covered Bond registered in the name of a nominee for a common depositary for Euroclear and/or Clearstream, Luxembourg, the Registered Global Covered Bond to the relevant depositary for Euroclear and/or Clearstream, Luxembourg (or otherwise, at such time, on such date, to such person and in such place as may have been agreed between the Issuer, the Relevant Dealer and the Registrar); 

 

	   	
  (b) 

	
 in the case of a Registered Global Covered Bond registered in the name of a nominee for DTC, the Registered Global Covered Bond to a custodian for DTC (or otherwise, at such time, on such date, to such person and in such place as may have been agreed between the Issuer, the Relevant Dealer and the Registrar); 

 

	   	
 (c) 

	
 in the case of a Registered Global Covered Bond registered in the name of CDS or its nominee, the Registered Global Covered Bond to a custodian for CDS or its nominee (or otherwise, at such time, on such date, to such person and in such place as may have been agreed between the Issuer, the Relevant Dealer and the Registrar); and 

 

	   	
 (d) 

	
 in the case of a Registered Global Covered Bond to be held under the NSS, to a nominee of the specified Common Safekeeper. The European Registrar will, on behalf of the Issuer, instruct the Common Safekeeper to effectuate the relevant Registered Global Covered Bond and instruct the ICSDs to make the appropriate entries in their records to reflect the initial outstanding aggregate principal amount of the relevant Tranche of Registered Global Covered Bonds. 

 

 The Registrar shall give instructions to Euroclear and/or Clearstream, Luxembourg and/or DTC and/or CDS to credit the Covered Bonds represented by the Registered Global Covered Bond to the Registrar’s (or in the case of Covered Bonds deposited with DTC or CDS, the Relevant Dealer’s participant account or the participant account of the DTC or CDS participant, as the case may be) distribution account and to hold each such Covered Bond to the order of the Issuer pending delivery to the Relevant Dealer(s) on a delivery against payment basis (or on such other basis as shall have been agreed between the Issuer and the Relevant Dealer and notified to the Registrar) in accordance with the normal procedures of Euroclear and/or Clearstream, Luxembourg, CDS and/or DTC, as the case may be and, following payment, to credit the Covered Bonds represented by such Global Covered Bond to such securities account(s) as shall have been notified to the Registrar by the Issuer.  The Registrar shall, on the Issue Date in respect of the relevant Tranche and against receipt of funds from the Relevant Dealer(s), or the Covered Bondholder, as the case  may be, transfer the proceeds of issue to the Issuer to the account notified in accordance with Clause 3.01 above (in the case of the European Registrar) or (in the case of any other Registrar the account notified in advance to the such Registrar by the European Registrar. 

 

    

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 If no such securities account(s) shall have been specified, the Registrar shall authenticate and make available at its specified office on the Issue Date in respect of the relevant Tranche the relevant Registered Global Covered Bond. 

 

 For greater certainty, the U.S. Registrar shall authenticate and deliver Registered Global Covered Bonds in the case of Clause 3.05(b) above and any Registered Definitive Covered Bonds (where issued directly or in exchange for such Registered Global Covered Bonds) on the instructions of the European Registrar, make all payments on such Registered Covered Bonds required by the Conditions and maintain the Register for all such Registered Covered Bonds.  The European Registrar shall authenticate and deliver Registered Global Covered Bonds in the case of Clause 3.05(a) above or any Registered Definitive Covered Bonds issued in exchange therefor, make all payments on such Registered Covered Bonds required by the Conditions, instruct the U.S. Registrar to authenticate and deliver Registered Global Covered Bonds in the case of Clause 3.05(b) and to pay the proceeds of issue to a specified account of the Issuer and maintain the Register for all such Registered Global Bonds. 

 

 Where the relevant Covered Bonds are N Covered Bonds, the Issuer shall: 

 

	   	
 (i) 

	
 as soon as practicable, but in any event not later than 10:00 a.m. (London time) on the third Banking Day prior to the proposed Issue Date, confirm by e-mail or tested fax to the Registrar (copied to the Issuing and Paying Agent), all such information as the Registrar may reasonably require to carry out its functions under this Agreement, provided that, in the case of a confirmation by email such confirmation shall be confirmed forthwith by post unless a return email acknowledging receipt is received by the sender; 

 

	   	
 (ii) 

	
 as soon as practicable, but in any event not later than 10:00 a.m. (London time) on the third Banking Day prior to the proposed Issue Date, deliver a copy, duly executed, of the relevant N Covered Bond along with the related N Covered Bond Agreement to the Registrar (copied to the Issuing and Paying Agent). 

 

 On the Issue Date the Registrar shall complete each N Covered Bond (including making out each N Covered Bond in the name of the relevant Covered Bondholder), authenticate and deliver each N Covered Bond to be issued. 

 

 For greater certainty, the Issuer shall procure the counter-execution by each holder of N Covered Bonds of the required number of the relevant N Covered Bond Agreement prior to delivering a copy, or copies (as the case may be) of the same to the Registrar in accordance with this Section 3.05. 

 

    

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 3.06    Subject to Clause 3.09, where the relevant Bearer Global Covered Bonds are NGCBs, on or before 10.00 a.m. (London time) on the Banking Day prior to the Issue Date in relation to each Tranche, the Issuing and Paying Agent shall authenticate and deliver each relevant Bearer Global Covered Bond to the specified Common Safekeeper (or otherwise, at such time, on such date, to such person and in such place as may have been agreed between the Issuer, the Relevant Dealer and the Issuing and Paying Agent). The Issuing and Paying Agent will, on behalf of the Issuer, on the issue date in accordance with the Issuer’s instructions instruct the Common Safekeeper to effectuate the relevant Bearer Global Covered Bond and instruct the ICSDs to make the appropriate entries in their records to reflect the initial outstanding aggregate principal amount of the relevant Tranche of Bearer Covered Bonds. 

 

 3.07    If the Issuing and Paying Agent or, as the case may be, the Registrar should pay an amount (an “advance”) to the Issuer in the belief that a payment has been or will be received from a Dealer, and if such payment is not received by the Issuing and Paying Agent or, as the case may be, the Registrar on the date that the Issuing and Paying Agent or, as the case may be, the Registrar pays the Issuer, the Issuer shall forthwith repay the advance (unless prior to such repayment the payment is received from the Dealer) and shall pay interest on such amount which shall accrue (as well after as before judgment) on the basis of a year of 360 days (365 days (366 days in the case of a leap year) in the case of an advance paid in sterling) and the actual number of days elapsed from the date of payment of such advance until the earlier of (i) repayment of the advance or (ii) receipt by the Issuing and Paying Agent or, as the case may be, the Registrar of the payment from the Dealer, and at the rate per annum certified by the Issuing and Paying Agent or, as the case may be, the Registrar and expressed as a rate per annum as reflecting its cost of funds for the time being in relation to the advance. 

 

 3.08    Subject to Clause 3.09, the Issuer shall, in relation to each Tranche of Covered Bonds which is represented by a Temporary Global Covered Bond, ensure that there is delivered to the Issuing and Paying Agent not less than five Banking Days before the relevant Temporary Global Covered Bond becomes exchangeable therefor, the Permanent Global Covered Bond (in unauthenticated form, but executed by the Issuer and otherwise complete) in relation thereto unless a master Permanent Global Covered Bond is to be used and the Issuer has provided the relevant document to the Issuing and Paying Agent pursuant to Clause 3.02 or, as the case may be, not less than ten Banking Days before the relevant Temporary Global Covered Bond becomes exchangeable therefor, the Bearer Definitive Covered Bonds (in unauthenticated form, but executed by the Issuer and otherwise complete) in relation thereto.  The Temporary Global Covered Bond is exchangeable for Bearer Definitive Covered Bonds and the Issuer shall ensure that there is delivered to the Issuing and Paying Agent sufficient Bearer Definitive Covered Bonds to enable the Issuing and Paying Agent, or the Registrar in the case of a Registered Global Covered Bond, to effect exchanges of interests in the relevant Global Covered Bond for Definitive Covered Bonds in accordance with the terms of the Temporary Global Covered Bond.  The Issuing and Paying Agent shall, subject to Clause 3.09, authenticate and deliver such Permanent Global Covered Bond (and where the relevant Global Covered Bond is a Eurosystem-eligible Covered Bond, the Issuing and Paying Agent shall instruct the Common Safekeeper to effectuate the Permanent Global Covered Bond) or, as the case may be, Definitive Covered Bonds in accordance with the terms hereof and of the relevant Temporary Global Covered Bond. 

 

    

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 3.09    Notwithstanding Clauses 3.04 and 3.06, where a Series of Covered Bonds is represented by a Permanent Global Covered Bond, on the issue of a subsequent Tranche of such Series (a) in the case of a Permanent Global Covered Bond that is a CGCB, the Issuer and the Relevant Dealer may agree that the Issuing and Paying Agent shall deliver the applicable Pricing Supplement to the common depositary or custodian, as the case may be, to be attached to the Permanent Global Covered Bond originally representing the Series and the Schedule to such Global Covered Bond, shall be updated to reflect the increase in principal amount of the Series by the principal amount of such Tranche; or (b) in the case of a Permanent Global Covered Bond that is an NGCB, the Issuer and the Relevant Dealer may agree that the Issuing and Paying Agent shall deliver the applicable Pricing Supplement to the Common Safekeeper to be attached to the Permanent Global Covered Bond representing the Series and instruct the ICSDs to make appropriate entries in their records to reflect the increase in principal amount of the Series by the principal amount of such Tranche. 

 

 3.10    The Issuer shall, in relation to each Tranche of Covered Bonds which is represented by a Permanent Global Covered Bond or Registered Global Covered Bond in relation to which an exchange notice has been given in accordance with the terms of such Global Covered Bond or which is due to be exchanged in accordance with its terms, ensure that there is delivered to the Issuing and Paying Agent and/or, as the case may be, the Registrar not less than ten Banking Days before the latest date on which the relevant notice period expires or, in any event, not less than ten Banking Days before the date on which such Global Covered Bond may be exchanged, the Definitive Covered Bonds (in unauthenticated form but executed by the Issuer and otherwise complete) in relation thereto.  The Issuing and Paying Agent or, as the case may be, the Registrar shall authenticate and deliver such Bearer Definitive Covered Bonds and/or Registered Definitive Covered Bonds in accordance with the terms hereof and of the relevant Global Covered Bond. 

 

 3.11    Where any Bearer Definitive Covered Bonds are to be delivered in exchange for a Temporary Global Covered Bond or a Permanent Global Covered Bond, the Issuing and Paying Agent shall ensure that (i) in the case of Bearer Definitive Covered Bonds with Coupons attached, such Bearer Definitive Covered Bonds shall have attached thereto only such Coupons as shall ensure that neither loss nor  gain of  interest shall accrue to the bearer thereof; (ii) in the case of Instalment Covered Bonds which are Bearer Definitive Covered Bonds with Receipts, such Bearer Definitive Covered Bonds shall have attached thereto only such Receipts in respect of Instalment Amounts as shall not then have been paid; and (iii) in the case of Instalment Covered Bonds which are Bearer Definitive Covered Bonds without Receipts, any Instalment Amounts that shall have then been paid shall be noted on the grid endorsed on such Bearer Definitive Covered Bonds. 

 

 3.12    The Issuing and Paying Agent or, as the case may be, the Registrar shall hold in safe custody all unauthenticated Global Covered Bonds, Definitive Covered Bonds (including any Coupons attached thereto) delivered to it in accordance with this Section 3, Section 4 and Section 10 and shall ensure that the same (or, in the case of a master Global Covered Bond, copies thereof) are authenticated and delivered only in accordance with the terms hereof and, if applicable, the relevant Global Covered Bond.  The Issuer shall ensure that each of the Issuing and Paying Agent, the Registrar and the Replacement Agent (as defined in Clause 4.01) holds sufficient Covered Bonds, Receipts or Coupons to fulfil its respective obligations under Section 4, Section 5 and Section 11 and each of the Issuing and Paying Agent, the Registrar and the Replacement Agent undertakes to notify the Issuer if it holds insufficient Covered Bonds, Receipts or Coupons for such purposes. 

 

 3.13    Each of the Issuing and Paying Agent and the Registrar is authorised by the Issuer to authenticate such Temporary Global Covered Bonds, Permanent Global Covered Bonds, Definitive Covered Bonds or, as the case may be, Registered Global Covered Bonds as may be required to be authenticated hereunder by the signature of any of their respective officers or any other person duly authorised for the purpose by the Issuing and Paying Agent or, as the case may be, the Registrar. 

 

    

 -16- 

    

 

 3.14    Where the Issuing and Paying Agent or European Registrar delivers any authenticated Eurosystem-eligible Covered Bonds to a Common Safekeeper for effectuation using electronic means, it is authorised and instructed to destroy the Bearer Global Covered Bond or Registered Global Covered Bond retained by it following its receipt of confirmation from the Common Safekeeper that the relevant Bearer Global Covered Bond or Registered Global Covered Bond has been effectuated. 

 

 3.15    On each occasion on which a portion of a Temporary Global Covered Bond or a Permanent Global Covered Bond is exchanged for a portion of a Permanent Global Covered Bond or, as the case may be, for Bearer Definitive Covered Bonds, the Issuing and Paying Agent shall note or procure that (i) if the relevant Global Covered Bond is a CGCB, there is noted on the Schedule to the Temporary Global Covered Bond or, as the case may be, Permanent Global Covered Bond the aggregate principal amount thereof so exchanged and the remaining principal amount of the Temporary Global Covered Bond or, as the case may be, Permanent Global Covered Bond (which shall be the previous principal amount thereof less (or, in the case of a Permanent Global Covered Bond in respect of an exchange of a portion of a Temporary Global Covered Bond, plus) the aggregate principal amount so exchanged) and shall procure the signature of such notation on its behalf and (ii) where the relevant Global Covered Bond is a NGCB, instruct the ICSDs in accordance with the provisions of schedule to make appropriate entries in their records to reflect the aggregate principal amount thereof as exchanged and the remaining principal amount of the relevant NGCB.  The Issuing and Paying Agent shall cancel or procure the cancellation of each Temporary Global Covered Bond or, as the case may be, Permanent Global Covered Bond against surrender (such surrender to be to the Issuing and Paying Agent or, in the case of a Temporary Global Covered Bond which is a NGCB exchangeable for a Permanent Global Covered Bond which is a NGCB, to or to the order of the Issuing and Paying Agent or Common Safekeeper) of which it has made full exchange for a Permanent Global Covered Bond or Bearer Definitive Covered Bonds and in the case of a NGCB, instruct the ICSDs in accordance with the provisions of the Fifth Schedule, to make appropriate entries in their records to reflect such cancellation and, if such Temporary Global Covered Bond is a NGCB and has not been surrendered to the Issuing and Paying Agent, instruct the Common Safekeeper to destroy the Temporary Global Covered Bond. 

 

 3.16    Upon any exchange of all or part of an interest in a Rule 144 Global Covered Bond for an interest on a Regulation S Global Covered Bond or vice versa or upon exchange of an interest in a Registered Global Covered Bond for Registered Definitive Covered Bonds, the Registrar is authorised on behalf of the Issuer (a) to make all appropriate entries in the Register to reflect the reduction or increase (as the case may be) in the principal amount of Covered Bonds represented by the relevant Registered Global Covered Bond(s), (b) in the case of Eurosystem-eligible Covered Bonds, to instruct the ICSDs to make appropriate entries in their records and (c) in the case of a total exchange for Registered Definitive Covered Bonds, to cancel or arrange for the cancellation of the relevant Registered Global Covered Bonds. 

 

    

 -17- 

    

 

 3.17    The Issuer or Guarantor LP shall, in relation to any Bearer Definitive Covered Bonds to which a Talon is attached upon the initial delivery thereof, on each occasion on which a Talon becomes exchangeable for further Coupons, not less than five Banking Days before the date on which the final Coupon comprised in any Coupon sheet (which includes a Talon) matures (“Talon Exchange Date”), ensure that there is delivered to the Issuing and Paying Agent such number of Coupon sheets as may be required in order to enable the Paying Agents (excluding the U.S. Paying Agent) to fulfil their obligation under Clause 3.12 hereof. 

 

 3.18    The relevant Paying Agent (excluding the U.S. Paying Agent) shall, against the presentation and surrender of any Talon, on or after the Talon Exchange Date in respect of such Talon, deliver a Coupon sheet provided that if any Talon is presented and surrendered for exchange to a Paying Agent and the Replacement Agent (as defined in Clause 4.01) has delivered a replacement therefor such Paying Agent shall forthwith notify the Issuer of such presentation and surrender and shall not exchange against the same unless and until it is so instructed by the Issuer.  After making such exchange, the Paying Agent shall cancel each Talon surrendered to it and in respect of which a Coupon sheet shall have been delivered and shall (if such Paying Agent is not the Issuing and Paying Agent) deliver the same to the Issuing and Paying Agent. 

 

 3.19    The Issuer or Guarantor LP undertakes to notify the Issuing and Paying Agent of any changes in the identity of the Dealers appointed generally in respect of the Programme and the Issuing and Paying Agent agrees to notify the other Agents thereof as soon as reasonably practicable thereafter. 

 

 3.20    In the case of Partly Paid Covered Bonds, on each occasion that payment is made to the Issuer in accordance with the Conditions, the Issuing and Paying Agent (in the case of a Temporary Global Covered Bond or a Permanent Global Covered Bond that is a CGCB) or the Registrar (in the case of Registered Covered Bonds) shall note or procure that there is noted on the Schedule to the relevant Global Covered Bond or, in the case of Registered Covered Bonds, in the Register (as defined herein) against the name of the relevant registered Holder (i) the aggregate principal amount of such payment, and (ii) the increased principal amount of the relevant Covered Bond (which shall be the previous principal amount plus the amount referred to at (i) above) and shall procure the signature of such notation on its behalf and in the case of a Eurosystem-eligible Covered Bond, instruct the ICSDs in accordance with the provisions of the Fifth Schedule, to make appropriate entries in their records to reflect such increased principal amount. 

 

 3.21    In the case of Partly Paid Covered Bonds, on each occasion on which any Covered Bonds are to be forfeited, the Issuer will give notice thereof to the Issuing and Paying Agent or, in the case of Registered Covered Bonds, the Registrar (copied to the Issuing and Paying Agent) of (in the case of a Global Covered Bond) the aggregate principal amount of Covered Bonds which are to be forfeited or (in the case of Registered Covered Bonds) the serial numbers of the Covered Bonds and the names of the registered Holders thereof which are to be forfeited and of the relevant Forfeiture Date. 

 

    

 -18- 

    

 

 3.22    In the case of Partly Paid Covered Bonds, on each occasion on which any Covered Bonds are forfeited, the Issuing and Paying Agent (i) (in the case of a Temporary Global Covered Bond or a Permanent Global Covered Bond that is a CGCB) or the Registrar (in the case of Registered Covered Bonds) shall note or procure that there is noted on the Schedule to the Temporary Global Covered Bond or Permanent Global Covered Bond or, in the case of Registered Covered Bonds, in respect of each Registered Covered Bond in the Register against the name of the relevant registered Holder, the aggregate principal amount or, in the case of Registered Covered Bonds, principal amount, so forfeited and the remaining principal amount of the Temporary Global Covered Bond or Permanent Global Covered Bond or Registered Covered Bond and shall procure the signature of such notation on its behalf and (ii) where the relevant Global Covered Bond is a Eurosystem-eligible Covered Bond, instruct the ICSDs in accordance with the provisions of the Fifth Schedule to make appropriate entries in their records to reflect the aggregate principal amount thereof as forfeited and the remaining principal amount of the Eurosystem-eligible Covered Bond.  The Issuing and Paying Agent shall cancel or procure the cancellation of each Temporary Global Covered Bond or, as the case may be, Permanent Global Covered Bond in respect of which all the Covered Bonds represented thereby have been forfeited and in the case of a NGCB, instruct the ICSDs in accordance with the provisions of the Fifth Schedule, to make appropriate entrees in their records to reflect such cancellation and, if such Temporary Global Covered Bond is a NGCB and has not been surrendered to the Issuing and Paying Agent, instruct the Common Safekeeper to destroy the Temporary Global Covered Bond. 

 

 3.23    In the event that the Issuer issues Covered Bonds under the Programme that are payable and/or dischargeable by the Issuer by payment or delivery of securities and/or other property or any combination of cash, securities and/or property, the procedures governing the issue of such Definitive Covered Bonds shall be set forth in the applicable Final Terms. 

 

 3.24    The Issuing and Paying Agent or, as the case may be, the European Registrar will on behalf of the Issuer ensure that the Covered Bonds of each Tranche are assigned, as applicable, security numbers (including, but not limited to, common codes and ISINs and, where applicable, CUSIP and CINS numbers) which are different from the security numbers assigned to Covered Bonds of any other Tranche of the same Series until at least the expiry of the Distribution Compliance Period in respect of the relevant Tranche.  For greater certainty, the Agents shall have no responsibility for obtaining any security numbers that may be required in respect of the N Covered Bonds. 

 

 Section 4.         Replacement Covered Bonds 

 

 4.01    The Issuing and Paying Agent or the Registrar or a Paying Agent or Transfer Agent (in such capacity “Replacement Agent”) shall, upon and in accordance with the written instructions of the Issuer but not otherwise, authenticate and deliver a Global Covered Bond, Definitive Covered Bond, Receipt or Coupon as a replacement for any of the same which has been mutilated or defaced or which has or has been alleged to have been destroyed, stolen or lost, provided that no Global Covered Bond, Definitive Covered Bond, Receipt or Coupon shall be delivered as a replacement for any of the same which has been mutilated or defaced otherwise than against surrender of same.  Such instructions shall include the serial number (except in the case of an N Covered  Bond, where such instructions shall include the name of the relevant Covered Bondholder) and denomination of the Global Covered Bond, Definitive Covered Bond, Receipt or Coupon to be replaced and will include, without limitation, the terms as to the payment of expenses and as to evidence, security and indemnity. 

 

 4.02    Each replacement Global Covered Bond, Covered Bond, Receipt or Coupon delivered hereunder shall bear a unique serial number (except in the case of an N Covered  Bond where it shall specify the name of the relevant Covered Bondholder) and be in a form otherwise identical to the Covered Bond it so replaces. 

 

    

 -19- 

    

 

 4.03    The Replacement Agent shall cancel each mutilated or defaced Global Covered Bond, Definitive Covered Bond, Receipt or  Coupon surrendered to it and in respect of which a replacement has been delivered. 

 

 4.04    The Replacement Agent shall notify the Issuer and (in the case of Registered Covered Bonds) the relevant Registrar and (in the case of the Bearer Covered Bonds) the other Paying Agents of the delivery by it in accordance herewith of any replacement Temporary Global Covered Bond, Permanent Global Covered Bond, Definitive Covered Bond, Receipt, Coupon or Registered Global Covered Bond, specifying the serial number (except in the case of an N Covered  Bond, where it shall specify the name of the relevant Covered Bondholder) and denomination thereof and the serial number and denomination (if any) of the Covered Bond which it replaces and confirming (if such be the case) that the Covered Bond which it replaces has been cancelled. 

 

 4.05    Unless the Issuer instructs otherwise, the Replacement Agent shall destroy each mutilated or defaced Global Covered Bond, Definitive Covered Bond, Receipt or Coupon surrendered to and cancelled by it and in respect of which a replacement has been delivered and shall, as soon as reasonably practicable but not later than three months after such destruction, furnish the Issuer with a certificate as to such destruction and specifying the serial numbers of the Global Covered Bond and Definitive Covered Bonds (except in the case of an N Covered  Bond, where it shall specify the name of the relevant Covered Bondholder) (distinguishing between different denominations) in numerical sequence and the total number by payment or maturity date of Receipts and Coupons (distinguishing Talons) as destroyed. 

 

 Section 5.         Determination of End of Distribution Compliance Period 

 

 5.01    In the case of a Tranche in respect of which there is only one Dealer, the Issuing and Paying Agent will determine the end of the Distribution Compliance Period in respect of such Tranche as being the fortieth day following the date certified by the Relevant Dealer to the Issuing and Paying Agent as being the date as of which distribution of the Covered Bonds of that Tranche was completed. 

 

 5.02    In the case of a Tranche in respect of which there is more than one Relevant Dealer but which is not subscribed on a syndicated basis, the Issuing and Paying Agent will determine the end of the Distribution Compliance Period in respect of such Tranche as being the fortieth day following the latest of the dates certified by all the Relevant Dealers to the Issuing and Paying Agent as being the respective dates as of which distribution of the Covered Bonds of that Tranche purchased by each such Relevant Dealer was completed. 

 

 5.03    In the case of a Tranche subscribed pursuant to a Subscription Agreement, the Issuing and Paying Agent will determine the end of the Distribution Compliance Period in respect of such Tranche as being the fortieth day following the date certified by the Lead Manager to the Issuing and Paying Agent as being the date as of which distribution of the Covered Bonds of that Tranche was completed. 

 

    

 -20- 

    

 

 5.04    Immediately after it determines the end of the Distribution Compliance Period in respect of any Tranche, the Issuing and Paying Agent shall notify such determination to the Issuer, Guarantor LP, the Bond Trustee, the Registrar (if applicable), Euroclear, Clearstream, Luxembourg, DTC or CDS as the case may be, and the relevant Dealers (in the case of an issue of Covered Bonds not subscribed pursuant to a Subscription Agreement) or the Lead Manager (in the case of an issue of Covered Bonds subscribed pursuant to a Subscription Agreement). 

 

 Section 6.         Payments to the Issuing and Paying Agent or the Registrar 

 

 6.01    In order to provide for the payment of interest and principal or, as the case may be, any other amount payable in respect of the Covered Bonds of each Series as the same shall become due and payable, the Issuer (failing which the Guarantor LP) shall (i) pay to the Issuing and Paying Agent or, as the case may be, the European Registrar on or before the date on which such payment becomes due an amount equal to the amount of principal or, as the case may be, interest (including for this purpose any amounts remaining payable in respect of uncancelled Coupons pertaining to Bearer Definitive Covered Bonds which have been cancelled following their purchase in accordance with the Conditions) then becoming due in respect of such Covered Bonds or any other amount payable; and (ii) in the case of a Bearer Global Covered Bond which is a NGCB or a Registered Global Covered Bond held under the NSS, shall procure that the Issuing and Paying Agent or European Registrar, as the case may be, in accordance with the provisions of the Fifth Schedule obtains from the ICSDs confirmation that the records of such ICSDs as to amounts payable on a relevant payment date and the records of the Issuing and Paying Agent or European Registrar as to amounts payable on a relevant payment date are identical. 

 

 6.02   The Issuing and Paying Agent or, as the case may be, the relevant Registrar shall withhold any pre-advice required by the rules of any relevant Clearing System regarding payment of the Final Redemption Amount on the Final Maturity Date of any Series of Covered Bonds until it has received the confirmation from the Issuer required under Condition 6.01 to the effect that payment will be made in full of the Final Redemption Amount on that Final Maturity Date. 

 

 6.03    Each amount payable by the Issuer under Clause 6.01 shall be paid unconditionally by credit transfer in the currency in which the Covered Bonds of the relevant Series are denominated or, if different, payable and in immediately available, freely transferable funds not later than 10.00 a.m. (local time) on the relevant day to such account with such bank as the Issuing and Paying Agent or, as the case may be, the European Registrar may by notice to the Issuer have specified for the purpose.  The Issuer shall, before 10.00 a.m. (local time) on the second local banking day before the due date of each payment by it under Clause 6.01, confirm to the Issuing and Paying Agent or, as the case may be, the European Registrar by SWIFT message or by such other means as may be agreed between the Issuer and the Issuing and Paying Agent or, as the case may be, the European Registrar that it has given irrevocable instructions for the transfer of the relevant funds to the Issuing and Paying Agent or, as the case may be, the European Registrar and the name and the account of the bank through which such payment is being made. 

 

    

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 6.04    Each of the Issuing and Paying Agent and the Registrar shall be entitled to deal with each amount paid to it hereunder in the same manner as other amounts paid to it as a banker by its customers provided that: 

 

	   	
 (a) 

	
 it shall not against the Issuer or Guarantor LP exercise any lien, right of set-off or similar claim in respect thereof; 

 

	   	
 (b) 

	
 unless otherwise agreed with the Issuer and Guarantor LP it shall not be liable to any person for interest thereon; and 

 

	   	
 (c) 

	
 money held by it need not be segregated except as required by law. 

 

 6.05    All moneys paid to the Issuing and Paying Agent by the Issuer or Guarantor LP in respect of any Bearer Covered Bond shall be held by the Issuing and Paying Agent and applied in accordance with Section 7.  Unless otherwise provided in the applicable Pricing Supplement, if any amount held by the Issuing and Paying Agent in respect of payments of interest, principal or, as the case may be, any other amount payable in respect  of any Bearer Covered Bond has not been collected two years after the date such amount became due and payable, the Issuing and Paying Agent shall notify the Issuer and Guarantor LP and, at the request of the Issuer or Guarantor LP, the Issuing and Paying Agent shall, as soon as practicable, repay such amount to the Issuer or Guarantor LP, as the case may be, by credit transfer to such account with such bank as the Issuer or Guarantor LP may by notice to the Issuing and Paying Agent have specified for the purpose. 

 

 6.06    If the Issuing and Paying Agent or, as the case may be, the European Registrar has not, (a) by 1.00 p.m. (local time) on the second local banking day before the due date of any payment to it under Clause 6.01, received notification of the relevant payment confirmation referred to in Clause 6.03 or (b) by 10.00 a.m. (local time) on the due date of any payment received the full amount payable under Clause 6.01 or (c) or in the case of a Eurosystem-eligible Covered Bond, by 10.00 a.m. (local time) on the due date of any payment received confirmation from the ICSDs (in accordance with the provisions of the Fifth Schedule) that the records of the ICSDs as to amounts payable on a relevant payment date are identical to the records of the Issuing and Paying Agent or European Registrar as to amounts payable on a relevant payment date under Clause 6.01, it shall forthwith notify the Issuer, Guarantor LP, the Bond Trustee, the U.S. Registrar (if applicable in the case of Registered Covered Bonds) and (in the case of Bearer Definitive Covered Bonds) the Paying Agents thereof.  If the Issuing and Paying Agent or, as the case may be, the European Registrar subsequently receives notification of such payment instructions or payment of the amount due or the Issuing and Paying Agent subsequently receives confirmation of such reconciliation of records, it shall forthwith notify the Issuer, Guarantor LP, the Bond Trustee, the U.S. Registrar (if applicable in the case of Registered Covered Bonds) and (in the case of Bearer Definitive Covered Bonds) the Paying Agents thereof. 

 

 6.07    All moneys paid to the European Registrar by the Issuer or Guarantor LP in respect of any Registered Covered Bond shall be held by the European Registrar and applied in accordance with Section 8.  Unless otherwise provided in the applicable Final Terms, if any amount held by the Registrar in respect of payments of interest, principal or, as the case may be, any other amount payable in respect of any Registered Covered Bond has not been collected two years after the date such amount became due and payable, the Registrar shall notify the Issuer and, at the request of the Issuer or Guarantor LP, the Registrar shall, as soon as practicable, repay such amount to the Issuer or Guarantor LP, as the case may be, by credit transfer to such account with such bank as the Issuer or Guarantor LP may by notice to the Registrar have specified for the purpose. 

 

    

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 Section 7.         Payments to Holders of Bearer Covered Bonds 

 

 7.01    Each Paying Agent acting through its specified office shall make payments of interest or, as the case may be, principal in respect of Bearer Covered Bonds in accordance with the Conditions applicable thereto (and, in the case of a Temporary Global Covered Bond or a Permanent Global Covered Bond, the terms thereof) provided that: 

 

	   	
 (a) 

	
 if any Temporary Global Covered Bond, Permanent Global Covered Bond, Bearer Definitive Covered Bond, Receipt or Coupon is presented or surrendered for payment to any Paying Agent and such Paying Agent has delivered a replacement therefor or has been notified that the same has been replaced, such Paying Agent shall forthwith notify the Issuer of such presentation or surrender and shall not make payment against the same until it is so instructed in writing by the Issuer and has received the amount to be so paid; 

 

	   	
 (b) 

	
 a Paying Agent shall not be obliged (but shall be entitled) to make such payments: 

 

	   	
 (i) 

	
 if it is not able to establish that the Issuing and Paying Agent has received (whether or not at the time due) the full amount of the relevant payment due to it under Clause 6.01; or 

 

	
    

	
 (ii) 

	
 if it has been notified in accordance with Clause 6.06 that the relevant payment instructions have not been received unless it is subsequently notified that such payment instructions have been received; 

 

	   	
 (c) 

	
 each Paying Agent shall cancel or procure the cancellation of each Temporary Global Covered Bond, Permanent Global Covered Bond, Bearer Definitive Covered Bond (in the case of early redemption, together with such unmatured Receipts or Coupons or unexchanged Talons as are attached to or are surrendered with it at the time of such redemption), Receipt or, as the case may be, Coupon against surrender of which it has made full payment and shall (if such Paying Agent is not the Issuing and Paying Agent) deliver or procure the delivery of each Temporary Global Covered Bond, Permanent Global Covered Bond, Bearer Definitive Covered Bond (together with unmatured Receipts or Coupons or unexchanged Talons as aforesaid) Receipt or Coupon so cancelled by it to the Issuing and Paying Agent or, in the case of a Global Covered Bond that is a NGCB, procure that the Issuing and Paying Agent instructs the Common Safekeeper to destroy the relevant Global Covered Bond; 

 

    

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 (d) 

	
 in the case of payment of principal or, as the case may be, interest against presentation of a Temporary Global Covered Bond or a Permanent Global Covered Bond or in the case of payment of an Instalment Amount in respect of an Instalment Covered Bond against presentation of a Bearer Definitive Covered Bond without Receipts, the relevant Paying Agent shall (i) in the case of a Global Covered Bond that is a CGCB or an Instalment Covered Bond represented by a Bearer Definitive Covered Bond without receipts, note or procure that there is noted on the Schedule thereto (or, in the absence of a schedule, on the face thereof) the amount of such payment and, in the case of payment of principal, the remaining principal amount of the relevant Covered Bond (which shall be the previous principal amount less the principal amount in respect of which payment has then been paid) and shall procure the signature of such notation on its behalf; and (ii) in the case of a Global Covered Bond which is an NGCB, the relevant Paying Agent shall notify the Issuing and Paying Agent in its capacity as Common Service Provider under the Issuer-ICSDs Agreement who shall instruct the ICSDs to make appropriate entries in their records to reflect such payment and shall advise the relevant Paying Agent of such instruction; and 

 

	   	
 (e) 

	
 a Paying Agent shall not make payments of principal or interest in respect of a Global Covered Bond which is a NGCB if: 

 

	   	
 (i) 

	
 in the case of the Issuing and Paying Agent, it has not received confirmation from the ICSDs (in accordance with the Fifth Schedule) that the records of the ICSDs as to amount payable on a relevant payment date and the records of the Issuing and Paying Agent as to amounts payable on a relevant payment date are identical; or 

 

	   	
 (ii) 

	
 in the case of any other Paying Agent, it has been notified in accordance with Clause 6.06 that confirmation from the ICSDs to amounts payable on a relevant payment date and the records of the Issuing and Paying Agent as to amounts payable on a relevant payment date has not been received, unless it is subsequently notified that such confirmation has been received; 

 

 7.02    None of the Paying Agents shall exercise any lien, right of set-off or similar claim against any person to whom it makes any payment under Clause 7.01 in respect thereof, nor shall any commission or expense be charged by it to any such person in respect thereof. 

 

 7.03    If a Paying Agent other than the Issuing and Paying Agent makes any payment in accordance with Clause 7.01: 

 

	   	
 (a) 

	
 it shall notify the Issuing and Paying Agent of the amount so paid by it, the serial number of the Temporary Global Covered Bond, Permanent Global Covered Bond, Definitive Covered Bond against (if applicable) presentation or surrender of which payment of principal or interest was made and the number of Coupons by maturity against which payment of interest was made; and 

 

    

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 (b) 

	
 subject to and to the extent of compliance by the Issuer with Clause 6.01 (whether or not at the time due), the Issuing and Paying Agent shall, out of the funds received by it under Clause 6.01, reimburse such Paying Agent by payment of an amount equal to the amount so paid by it by paying the same by credit transfer to such account with such bank as such Paying Agent may by notice to the Issuing and Paying Agent have specified for the purpose. 

 

 7.04    If the Issuing and Paying Agent makes any payment in accordance with Clause 7.01, it shall be entitled to appropriate for its own account out of the funds received by it under Clause 6.01 an amount equal to the amount so paid by it. 

 

 7.05    If any Paying Agent makes a payment in respect of Bearer Covered Bonds at a time at which the Issuing and Paying Agent has not received the full amount of the relevant payment due to it under Clause 6.01, and the Issuing and Paying Agent is not able out of the funds received by it under Clause 6.01 to reimburse such Paying Agent therefor (whether by payment under Clause 7.03 or appropriation under Clause 7.04), the Issuer (failing which the Guarantor LP) shall from time to time on demand pay to the Issuing and Paying Agent for the account of such Paying Agent: 

 

	   	
 (a)  

	
 the amount so paid out by such Paying Agent and not so reimbursed to it; and 

     

	   	
 (b) 

	
 interest on such amount from the date on which such Paying Agent made such payment until the date of reimbursement of such amount; 

 

 provided that any payment made under paragraph (a) above shall satisfy pro tanto the Issuer’s or Guarantor LP’s obligations under Clause 6.01. 

 

 7.06   Interest shall accrue for the purpose of paragraph (b) of Clause 7.05 (both before and after judgement) on the basis of a year of 360 days (365 days (366 days in the case of a leap year) in the case of an amount in sterling) and the actual number of days elapsed and at the rate per annum which is the rate per annum specified by the Issuing and Paying Agent as reflecting its cost of funds for the time being in relation to the unpaid amount. 

 

 7.07   If at any time and for any reason a Paying Agent makes a partial payment in respect of any Temporary Global Covered Bond, Permanent Global Covered Bond, Definitive Covered Bond or Coupon surrendered for payment to it, such Paying Agent shall (i) unless the Global Covered Bond is an NGCB, endorse thereon (and, in the case of an Instalment Covered Bond which is a Definitive Covered Bond, on the relevant Receipt) a statement indicating  the amount and date of such payment or (ii) where the Global Covered Bond is a NGCB, the Paying Agent shall advise the Issuing and Paying Agent and the Issuing and Paying Agent shall instruct the ICSDs to make appropriate entries in their records to reflect such shortfall in payment. 

 

 Section 8.         Payments to Holders of Registered Covered Bonds 

 

    

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 8.01     The Registrar acting through its specified office shall make payments of interest or, as the case may be, principal in respect of Registered Covered Bonds in accordance with the Conditions applicable thereto, provided that such Registrar shall not be obliged (but shall be entitled) to make such payments if it is not able to establish that it has received (whether or not at the due time) the full amount of the relevant payment due to it under Clause 6.01 or, in the case of the Canadian Registrar or the U.S. Registrar, as applicable, if it has not received from the European Registrar the full amount of the relevant payment required to be made by it by 12.00 p.m. (local time) on the relevant day to such account with such bank as the Canadian Registrar or U.S. Registrar, as applicable, may by notice to the European Registrar have specified for the purpose. 

 

 8.02    The Registrar shall not exercise any lien, right of set-off or similar claim against any person to whom it makes any payment under Clause 8.01 in respect thereof, nor shall any commission or expense be charged by it to any such person in respect thereof. 

 

 8.03    If a Registrar makes any payment in accordance with Clause 8.01, it shall be entitled to appropriate for its own account out of the funds received by it under Clause 6.01 an amount equal to the amount so paid by it. 

 

 8.04    If a Registrar makes a payment in respect of Registered Covered Bonds at a time at which it has not received the full amount of the relevant payment due to it under Clause 6.01 and is not able out of funds received by it under Clause 6.01 to reimburse itself therefor by appropriation under Clause 8.03, the Issuer (failing which the Guarantor LP) shall from time to time on demand pay to the Registrar for its own account: 

 

	   	
 (a) 

	
 the amount so paid out by such Registrar and not so reimbursed to it; and 

              

	   	
 (b) 

	
 interest on such amount from the date on which such Registrar made such  payment until the date of reimbursement of such amount; 

 

 provided that any payment made under paragraph (a) above shall satisfy pro tanto the Issuer’s or Guarantor LP’s obligations under Clause 6.01. 

 

 8.05    Interest shall accrue for the purpose of paragraph (b) of Clause 8.04 (as well after as before judgment) on the basis of a year of 360 days (365 days (366 days in the case of a leap year) in the case of an amount in sterling) and the actual number of days elapsed and at the rate per annum which is the rate per annum specified by the Registrar as reflecting its cost of funds for the time being in relation to the unpaid amount. 

 

 8.06   If at any time and for any reason a Registrar makes a partial payment in respect of any Registered Covered Bond surrendered for payment to it, such Registrar shall endorse thereon and in the Register a statement indicating the amount and date of such payment. 

 

 8.07    The European Registrar shall on demand, and subject to having received payment as provided for in Clause 6.01, promptly reimburse the Canadian Registrar or U.S. Registrar, as the case may be, for payments in respect of Registered Covered Bonds properly made by such Registrar in accordance with this Agreement and the Conditions when it has not received the full amount of the relevant payment due to it under Clause 8.01. 

 

 8.08    The U.S. Registrar shall pay to the Exchange Agent, and the Exchange Agent shall receive, all payments made under any Registered Global Covered Bond registered in the name of DTC or its nominee (a DTC Covered Bond) which is denominated in a Specified Currency other than U.S. dollars. The Exchange Agent shall, in accordance with normal DTC practice, be advised in writing, on or before the relevant Record Date, by DTC or its nominee: 

 

    

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 (a) 

	
 if any beneficial holder (a “Beneficial Holder”) of the DTC Covered Bond in respect of which payment is due has elected to receive the payment in U.S. dollars and, if so, the amount of the payment (expressed in the Specified Currency in which the relevant DTC Covered Bond is denominated) which the Beneficial Holder wishes to receive in U.S. dollars; and 

 

	   	
 (b) 

	
 of the payment details for each Beneficial Holder. 

         

 8.09    The Exchange Agent shall enter into a contract on behalf of the Issuer at or before 11:00 a.m. (New York City time) on the second New York Business Day (as defined below) preceding the applicable payment date and will solicit bid quotations from three recognised foreign exchange dealers (which may include the Exchange Agent) for the purchase of U.S. dollars with an amount of the relevant Specified Currency equal to the aggregate amount which DTC has notified the Exchange Agent that Beneficial Holders wish to receive in U.S. dollars. In the event that no notification is received from DTC before the Record Date, the Exchange Agent shall enter into a contract for the purchase of U.S. dollars in respect of the full amount of the payment due in respect of the relevant DTC Covered Bond. The settlement date for each purchase shall be the applicable payment date and the Exchange Agent shall enter into a contract for the purchase of the relevant amount of U.S. dollars on the basis of the most favourable bid submitted. The Exchange Agent shall, on the relevant payment day: 

 

	   	
 (a) 

	
 pay all amounts converted into U.S. dollars as stated above to DTC or its nominee for distribution to the relevant Beneficial Holders; 

 

	   	
 (b) 

	
 pay all the other amounts due which are denominated otherwise than in U.S. dollars direct to the relevant Beneficial Holders in accordance with the payment instructions received from DTC or its nominee. 

 

 For the purposes of this subclause, “New York Business Day” means a day (other than a Saturday or a Sunday) on which foreign exchange markets are open for business in New York City that is neither a legal holiday nor a day on which banking institutions are authorised or required by law or regulation to close in New York City and (i) with respect to Covered Bonds payable in a Specified Currency other than euro, in the principal financial centre of the relevant Specified Currency (if other than New York City and which, if the Specified Currency is Australian or New Zealand dollars, shall be Sydney and Auckland, respectively) and (ii) with respect to Covered Bonds payable in euro, a day on which the TARGET2 System is open. 

 

 8.10    In the event that the Exchange Agent is unable to convert the relevant Specified Currency into U.S. dollars, the entire payment will be made in the relevant Specified Currency in accordance with the payment instructions received from DTC following notification by the Exchange Agent to DTC of that fact. 

 

    

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 Section 9.         Miscellaneous Duties of the Issuing and Paying Agent and the Paying Agents 

 

 Cancellation, destruction and records 

 

 9.01     The Issuing and Paying Agent shall: 

 

	   	
 (a) 

	
 separately in respect of each Series of Covered Bonds, maintain a record of all  Temporary Global Covered Bonds, Permanent Global Covered Bonds, Definitive Covered Bonds, Receipts and Coupons delivered hereunder and of their redemption, payment, exchange, forfeiture (in the case of Partly Paid Covered Bonds), cancellation, mutilation, defacement, alleged destruction, theft or loss or replacement provided that no record need be maintained of the serial numbers of Receipts or Coupons (save insofar as that a record shall be maintained of the serial numbers of unmatured Receipts and Coupons and/or unexchanged Talons missing at the time of redemption or other cancellation of the relevant Bearer Definitive Covered Bonds and, in the case of Coupons, of any subsequent payments against such Coupons) and shall send forthwith to the other Paying Agents a list of any unmatured Receipts and Coupons and/or unexchanged Talons missing upon redemption or cancellation of the relevant Bearer Definitive Covered Bond, distinguishing between different denominations; 

 

	   	
 (b) 

	
 in respect of each series of Covered Bonds issued as NGCBs, advise each ICSD and, where applicable, the Common Safekeeper, of all Global Covered Bonds which are NGCBs delivered hereunder and of their redemption, payment, exchange, cancellation, mutilation, defacement, alleged destruction, theft or loss or replacement thereof; 

 

	   	
 (c) 

	
 separately in respect of each Series of Covered Bonds, maintain a record of all certifications received by it in accordance with the provisions of any Temporary Global Covered Bond; 

 

	   	
 (d) 

	
 upon request by the Issuer, inform the Issuer of the spot rate of exchange quoted by it for the purpose of the currency in which the relevant Covered Bonds are denominated against payment of U.S. dollars (or such other currency specified by the Issuer) on the date on which the Relevant Agreement (as defined in the Dealership Agreement) in respect of such Covered Bonds was made; and 

 

	   	
 (e) 

	
 make such records available for inspection at all reasonable times by the Issuer and the other Paying Agents. 

 

 9.02    The Paying Agents shall make available to the Issuing and Paying Agent such information as may reasonably be required for the maintenance of the records referred to in Clause 9.01 and for the Issuing and Paying Agent to perform in the duties set out in the Fifth Schedule. 

 

    

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 9.03    The Issuer or Guarantor LP may from time to time deliver Definitive Covered Bonds and unmatured Coupons pertaining thereto to the Issuing and Paying Agent for cancellation, whereupon the Issuing and Paying Agent shall cancel such Definitive Covered Bonds and Coupons.  The Issuer or Guarantor LP may from time to time procure the delivery to the Issuing and Paying Agent of a Temporary Global Covered Bond or a Permanent Global Covered Bond with written instructions to cancel a specified aggregate principal amount of Covered Bonds represented thereby (which instructions shall be accompanied by evidence that the Issuer or Guarantor LP is entitled to give such instructions) whereupon the Issuing and Paying Agent shall (i) in the case of a Global Covered Bond which is a CGCB, note or procure that there is noted on the schedule to such Temporary Global Covered Bond or Permanent Global Covered Bond the aggregate principal amount of Covered Bonds so to be cancelled and the remaining principal amount thereof (which shall be the previous principal amount thereof less the aggregate principal amount of the Covered Bonds so cancelled) and shall procure the signature of such notation on its behalf, and (ii) in the case of a Global Covered Bond which is a NGCB, the Issuing and Paying Agent shall instruct the ICSDs in accordance with the provisions of the Fifth Schedule to make appropriate entries in their records to reflect such cancellation provided the Issuer or Guarantor LP has notified the Issuing and Paying Agent of the same in writing. 

 

 9.04    As soon as practicable (but in any event not later than three months) after each interest or other payment date in relation to any Series of Bearer Covered Bonds, after each date on which Covered Bonds are cancelled in accordance with Clause 9.03, and after each date on which the Covered Bonds fall due for redemption, the Issuing and Paying Agent shall notify the Issuer, Guarantor LP, the Bond Trustee and the other Paying Agents and the ICSDs (in accordance with the provisions of the Fifth Schedule) (on the basis of the information available to it and distinguishing between the Covered Bonds of each Series) of the serial numbers of any Bearer Definitive Covered Bonds and/or the number of Coupons (by reference to maturity) against presentation or surrender of which payment has been made and of the serial numbers of any Definitive Covered Bonds (distinguishing between different denominations) or, as the case may be, Coupons which have not yet been presented or surrendered for payment. 

 

 9.05    The Issuing and Paying Agent may (i) destroy each Temporary Global Covered Bond which is a CGCB, Permanent Global Covered Bond which is a CGCB, Definitive Covered Bond, Receipt and Coupon delivered to or cancelled by it in accordance with Clause 3.15, Clause 3.18, Clause 3.22, Clause 7.01(c) or (where there is no principal amount remaining of such Temporary Global Covered Bond or Permanent Global Covered Bond) delivered to and cancelled by it in accordance with Clause 9.03, in which case it shall as soon as reasonably practicable (but not later than 3 months after such destruction) furnish the Issuer with a certificate as to such destruction distinguishing between the Covered Bonds of each Series and specifying the serial numbers of the Temporary Global Covered Bond, Permanent Global Covered Bond and Definitive Covered Bonds in numerical sequence (and containing particulars of any unmatured Receipts or Coupons and unexchanged Talons attached thereto or surrendered therewith) and the total number by payment or maturity date of Receipts and Coupons (distinguishing Talons) so destroyed; and (ii) procure that the Common Safekeeper destroy each Temporary Global Covered Bond which is a NGCB and Permanent Global Covered Bond which is a NGCB in accordance with Clause 3.22 or Clause 7.01(c), in which case, upon receipt of confirmation of destruction from the Common Safekeeper, the Issuing and Paying Agent shall upon the request of the Issuer or Guarantor LP furnish the Issuer with a certificate as to such destruction and specifying the serial numbers of the relevant Global Covered Bond so destroyed. 

 

    

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 Meetings of Holders of Covered Bonds 

 

 9.06    Each Paying Agent shall, at the request of the Holder of any Bearer Covered Bond issue voting certificates and block voting instructions in a form and manner which comply with the provisions of Schedule 5 of the Trust Deed (except that it shall not be required to issue the same less than forty-eight hours before the time fixed for any meeting therein provided for) and shall perform and comply with the provisions of Schedule 5 of the Trust Deed.  Each Paying Agent shall keep a full record of voting certificates and block voting instructions issued by it and will give to the Issuer and Guarantor LP not less than twenty-four hours before the time appointed for any meeting or adjourned meeting full particulars of all voting certificates and block voting instructions issued by it in respect of such meeting or adjourned meeting. 

 

 Documents available for inspection or available free of charge 

 

 9.07    The Issuer shall provide to the Issuing and Paying Agent for distribution among the Paying Agents: 

 

	   	
 (a)  

	
 specimen Covered Bonds; 

 

	   	
 (b) 

	
 sufficient copies of all documents required to be available for inspection, or to be made available free of charge (including the Prospectus, U.S. Prospectus or Canadian Prospectus, as applicable, in respect of which Covered Bonds have been or are being issued, as the case may be, together with any supplements thereto and any documents incorporated by reference therein) as specified in the Prospectus, U.S. Prospectus or Canadian Prospectus, as the case may be, in relation to any Covered Bonds, the Conditions or the Final Terms in respect of such Covered Bonds; and 

 

	   	
 (c) 

	
 in the event that the provisions of such Condition become relevant in relation to any Covered Bonds, the documents required under the Condition headed “Early Redemption for Taxation Reasons”. 

 

 9.08    Each Paying Agent shall make available for inspection or available free of charge, as the case may be, during normal business hours at its specified office such documents as may be specified as so available at the specified office of such agent in the Prospectus, U.S. Prospectus or Canadian Prospectus or, in relation to any Covered Bonds, the Conditions or the Final Terms in respect of such Covered Bonds requiring a prospectus under the Prospectus Directive or listed on a Regulated Market, or as may be required by applicable Laws or the rules of any stock exchange on which the Covered Bonds may be listed and admitted to trading.  Without limiting the generality of the foregoing, the Issuing and Paying Agent shall in respect of Covered Bonds issued under the Prospectus (i) make available free of charge the Prospectus, all supplementary prospectuses, any Stand-Alone Prospectus, all Final Terms and all documents specified under “Documents Incorporated by Reference” in the Prospectus or incorporated by reference in any supplementary prospectus or Stand-Alone Prospectus and (ii) make available for inspection during normal business hours at its specified office copies of the Prospectus and all other documents listed in paragraph 8 of the General Information section of the Prospectus; provided however that in any event copies of the Final Terms relating to a Series of Covered Bonds that is not offered to the public nor admitted to trading on a Regulated Market in circumstances requiring publication of a prospectus under the Prospectus Directive nor admitted to trading on the PSM will only be made available to Holders or Relevant Account Holders thereof on production of evidence satisfactory to the Issuing and Paying Agent as to such Holder’s or Relevant Account Holder’s holding of the relevant Covered Bonds and its identity and (iii) in the event that the provisions of such Condition become relevant, make available for inspection during normal business hours at its specified office the certificate required in the Condition headed “Early Redemption for Taxation Reasons”. 

 

    

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 9.09    The Issuer agrees that it will, in relation to any Covered Bonds which are restricted securities (as defined in Rule 144(A)(3) under the Securities Act) during any period in relation thereto during which it is neither subject to Section 13 or 15(d) of the Exchange Act nor exempt from reporting pursuant to Rule 12g3-2(b) under the Exchange Act, make available on request to each of the Paying Agents, the information specified in and meeting the requirements of Rule 144A(d)(4) under the Securities Act in order that such Paying Agent may make such information available to Holders of any Covered Bonds as contemplated in Clause 3.02(e) of the Dealership Agreement. 

 

 Notifications and Filings 

 

 9.10    The Issuing and Paying Agent shall (on behalf of the Issuer and Guarantor LP) make all necessary notifications and filings as may be required from time to time in relation to the issue, purchase and redemption of Covered Bonds by all applicable laws, regulations and guidelines and, in particular but without limitation, those promulgated under the FSMA, in the case of Covered Bonds the proceeds of which are accepted by the Issuer in the United Kingdom. 

 

 Save as aforesaid, the Issuer and Guarantor LP shall be solely responsible for ensuring that each Covered Bond to be issued or other transactions to be effected hereunder shall comply with all applicable laws and regulations of any governmental or other regulatory authority in connection with any Covered Bond and that all necessary consents and approvals of, notifications to and registrations and filings with, any such authority in connection therewith are effected, obtained and maintained in full force and effect. 

 

 Indemnity 

 

 9.11    Each of the Paying Agents shall severally indemnify the Issuer and Guarantor LP against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which the Issuer and the Guarantor LP may incur, otherwise than by reason of the Issuer’s or Guarantor LP’s own negligence or wilful misconduct, as a result or arising out of or in relation to any material breach by such Paying Agent of the terms of this Agreement which results from such Paying Agent’s own negligence or wilful misconduct. 

 

    

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 Notices 

 

 9.12   The Issuing and Paying Agent and the Registrar each agrees with the Issuer and Guarantor LP that, to the extent that it is notified in writing by each Relevant Dealer that the distribution of the Covered Bonds of any Tranche is complete, it will notify the Issuer, Guarantor LP and the other Relevant Dealers of the completion of distribution of the Covered Bonds of any Tranche which are sold to or through more than one Dealer. 

 

 9.13    The Issuing and Paying Agent and the Registrar each shall promptly notify the Issuer and Guarantor LP of any written notice delivered to it declaring a Covered Bond due and payable by reason of an Issuer Event of Default or Guarantor Event of Default. 

 

 9.14    The Issuing and Paying Agent shall, upon and in accordance with the written  instructions of the Issuer, Guarantor LP or the Bond Trustee  but not otherwise, arrange for the delivery or publication in accordance with the Conditions or Trust Deed of any notice which is to be given to the Holders of any Bearer Covered Bonds and shall supply a copy thereof to each other Agent. 

 

 Section 10.      Early Redemption and Exercise of Options 

 

 10.01   If the Issuer intends (other than consequent upon an Issuer Event of Default) to redeem all or any of the Covered Bonds prior to their stated maturity date or to exercise any other option under the Conditions, it shall, not less than 14 days prior to the latest date for the publication of the notice of redemption or of exercise of the Issuer’s option required to be given to the Holders of any Covered Bonds, give written notice of such intention to the Bond Trustee and the Issuing and Paying Agent or, in the case of Registered Covered Bonds, the Registrar (copied to the Issuing and Paying Agent) stating the date on which such Covered Bonds are to be redeemed or such option is to be exercised. 

 

 10.02   In respect of any Covered Bonds to which Condition 6.07 applies or which carries any other right of redemption or other right exercisable at the option of the Holders of such Covered Bonds, the Issuer will provide the Paying Agents or, in the case of Registered Covered Bonds, the Registrar with copies of the form of the current redemption notice or exercise notice and the Paying Agents or, as the case may be, the Registrar will make available forms of the current redemption notice or exercise notice to Holders of Covered Bonds upon request during usual business hours at their respective specified offices.  Upon receipt of any Covered Bond deposited in the exercise of such option, the Paying Agent or, in the case of Registered Covered Bonds, the Registrar with which such Covered Bond is deposited shall hold such Covered Bond (together with, in the case of a Definitive Covered Bond, any Receipts and/or Coupons relating to it deposited with it) on behalf of the depositing Holder of such Covered Bond (but shall not, save as provided below, release it) until the due date for redemption of the relevant Covered Bond consequent upon the exercise of such option, or, as the case may be, the date upon which the exercise of such option takes effect when, in the case of redemption and subject as provided below, it shall present such Covered Bond (and any such Receipts and/or Coupons) to itself for payment in accordance with the Conditions and shall pay such moneys in accordance with the directions of the Holder of the Covered Bond contained in the relevant redemption notice.  In the case of an exercise of any other option, the relevant Paying Agent or, in the case of Registered Covered Bonds, the Registrar, shall take such steps as may be required to be taken by it in the Conditions.  If, prior to such due date for its redemption or the date upon which the exercise of such option takes effect, an Event of Default occurs in respect of such Covered Bond or if upon due presentation payment of such redemption moneys is improperly withheld or refused, the Paying Agent concerned or, as the case may be, the Registrar shall, without prejudice to the exercise of such option, mail such Covered Bond (together with any such Receipts and/or Coupons) by uninsured post to, and at the risk of, the Holder of the relevant Covered Bond at such address as may have been given by such Holder in the relevant redemption notice. 

 

    

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 10.03    At the end of any applicable period for the exercise of such option or, as the case may be, not later than 7 days after the latest date for the exercise of such option, in relation to Bearer Covered Bonds each Paying Agent shall promptly notify the Issuing and Paying Agent of the principal amount of the Covered Bonds in respect of which such option has been exercised with it together with their serial numbers and the Issuing and Paying Agent shall promptly notify such details to the Issuer, Guarantor LP and the Bond Trustee and, in the case of a Global Covered Bond that is a NGCB, shall instruct the ICSDs to make appropriate entries in their records to reflect the exercise of such option and otherwise shall comply with the provisions set out in the Fifth Schedule. 

 

 10.04    At the end of any applicable period for the exercise of such option or, as the case may be, not later than 7 days after the latest date for the exercise of such option, in relation to Registered Covered Bonds, the Registrar shall promptly notify the Issuer, Guarantor LP and the Bond Trustee of the principal amount of the Covered Bonds in respect of which such option has been exercised together with their serial numbers and in the case of a Registered Global Covered Bond held under the NSS, the European Registrar shall instruct the ICSDs to make appropriate entries in their records to reflect the exercise of such option and otherwise shall comply with the provisions set out in the Fifth Schedule. 

 

 Section 11.      The Register and Miscellaneous Duties of the Registrar 

 

 Cancellation and Records 

 

 11.01     Each Registrar shall maintain, in relation to the portion of each Series of Registered Covered Bonds in relation to which it is appointed as registrar and authenticated the relevant Covered Bonds, a central securities register at any place outside the United Kingdom (collectively, the “Register”), which shall be kept in accordance with the Conditions applicable to such Series of Registered Covered Bonds and the Regulations.  The Register shall show the aggregate principal amount and date of issue of each Tranche comprising the relevant Series of Registered Covered Bonds, the names, alphabetically arranged, and latest known addresses of the initial Holders thereof and the dates and particulars of all issues and transfers to, and the names, alphabetically arranged, and latest known addresses of, all subsequent Holders thereof.  The Register should also record details of all repurchases and cancellations of Registered Covered Bonds, instalment payments, redemptions and payments of any amounts in Registered Covered Bonds. In the case of Registered Global Covered Bonds held under the NSS, the European Registrar shall instruct the ICSDs to make any appropriate entries in their records to reflect the information contained in the Register, including any payment, exchange, redemption and cancellation. 

 

    

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 11.02    The Registrar shall by the issue of new Registered Covered Bonds, the cancellation of all Registered Covered Bonds and the making (or causing to be made) of entries in the Register record transfers of Registered Covered Bonds in accordance with the Conditions applicable thereto and the Regulations. 

 

 11.03    The Registrar shall maintain proper records of the details of all documents and certificates (including, but not limited to, Transfer Certificates received by itself or any other Transfer Agent (subject to receipt of all necessary information from the other Transfer Agents). 

 

 11.04    The Registrar shall comply with the terms of any Transfer Certificates or N Covered Bond Assignment Agreements, as applicable. 

 

 11.05     The Issuer may from time to time deliver Registered Covered Bonds of which it or any of its subsidiaries is the Holder to the Registrar for cancellation, whereupon the Registrar shall cancel the same and shall make (or cause to be made) the corresponding entries in the Register. 

 

 11.06    As soon as reasonably practicable but in any event within three months after each date on which Registered Covered Bonds fall due for redemption, the Registrar shall notify the Issuer, Guarantor LP or the Bond Trustee of the serial numbers of any Registered Covered Bonds against surrender of which payment has been made and of the serial numbers of any Registered Covered Bonds (and the names and addresses of the Holders thereof) which have not yet been surrendered for payment. 

 

 11.07    The Registrar shall, upon and in accordance with the instructions of the Issuer, Guarantor LP or the Bond Trustee but not otherwise, arrange for the delivery in accordance with the Conditions of any notice which is to be given to the Holders of Registered Covered Bonds. 

 

 11.08    The Issuer shall ensure that each Registrar has available to it supplies of such Registered Covered Bonds as shall be necessary in connection with the transfer of Registered Covered Bonds under this Section 11. 

 

 Meetings of Holders of Covered Bonds 

 

 11.09    The Registrar shall, at the request of the Holder of any Registered Covered Bond, make available, at the request of the Holder of any Registered Covered Bond, forms of proxy (to be provided by the Issuer) in a form and manner which comply with the provisions of Schedule 5 of the Trust Deed and shall perform and comply with the provisions of Schedule 5 of the Trust Deed. 

 

 Documents and Forms 

 

 11.10    The Issuer shall provide to the Registrar: 

 

   (a)         specimen Covered Bonds; 

 

    

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 (b) 

	
 sufficient copies of all documents required to be available for inspection, or to be made available free of charge (including the Prospectus, U.S. Prospectus or Canadian Prospectus, as applicable, in respect of which the Covered Bonds have been or are being issued, as the case may be, together with any supplements thereto and any documents incorporated by reference therein) as specified in the Prospectus, U.S. Prospectus or Canadian Prospectus, as the case may be, in relation to any Covered Bonds, the Conditions or the Final Terms in respect of such Covered Bonds; and 

 

	   	
 (c) 

	
 in the event that the provisions of such Condition become relevant in relation to any Covered Bonds, the documents required under the Condition headed “Early Redemption for Taxation Reasons”. 

 

 11.11    The Registrar shall make available for inspection or available free of charge, as the case may be, during normal business hours at its specified office such documents as may be specified as so available at the specified office of such agent in the Prospectus, U.S. Prospectus or Canadian Prospectus or, in relation to any Covered Bonds, the Conditions or the Final Terms in respect of such Covered Bonds requiring a prospectus under the Prospectus Directive or listed on a Regulated Market, or as may be required by applicable Laws or the rules of any stock exchange on which the Covered Bonds may be listed and admitted to trading. Without limiting the generality of the foregoing, the Issuing and Paying Agent shall in respect of Covered Bonds issued under the Prospectus (i) make available free of charge the Prospectus, all supplementary prospectuses, any Stand-Alone Prospectus and all documents specified under “Documents Incorporated by Reference” in the Prospectus or incorporated by reference in any supplementary prospectus or Stand-Alone Prospectus and (ii) make available for inspection during normal business hours at its specified office copies of the Prospectus and all other documents listed in paragraph 8 of the General Information section of the Prospectus; provided however that in any event copies of the Final Terms relating to a Series of Covered Bonds that is not offered to the public nor admitted to trading on a Regulated Market in circumstances requiring publication of a prospectus under the Prospectus Directive nor admitted to trading on the PSM will only be made available to Holders or Relevant Account Holders thereof on production of evidence satisfactory to the Registrar as to such Holder’s or Relevant Account Holder’s holding of the relevant Covered Bonds and its identity, and (iii) in the event that the provisions of such Condition become relevant, the certificate required in the Condition headed “Early Redemption for Taxation Reasons”. 

 

 11.12     The Issuer agrees that it will, in relation to any Covered Bonds which are restricted securities (as defined in Rule 144(A)(3) under the Securities Act) during any period in relation thereto during which it is neither subject to Section 13 or 15(d) of the Exchange Act nor exempt from reporting pursuant to Rule 12g3-2(b) under the Exchange Act, make available on request to the Registrar, the information specified in and meeting the requirements of Rule 144A(d)(4) under the Securities Act in order that the Registrar may make such information available to Holders of any Covered Bonds upon request by such Holder. 

 

    

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 Provision of Information 

 

 11.13    The Registrar shall provide the Issuing and Paying Agent with all such information as the Issuing and Paying Agent may reasonably require in order to perform the obligations set out in Clause 9.10 hereof. 

 

 Section 12.       Other Duties of the Transfer Agents and the Exchange Agent 

 

 12.01     The Transfer Agents shall perform the duties set out in this Agreement and the Conditions and, in performing those duties, shall act in accordance with this Agreement and the Conditions. 

 

 12.02     Each Transfer Agent shall: 

 

	   	
 (a) 

	
 accept Registered Covered Bonds delivered to it, with (i) the form of transfer on them duly executed together with, as applicable, any Transfer Certificate, or (ii) in the case of N Covered Bonds, the duly executed N Covered Bond Assignment Agreement, as applicable, for the transfer, exchange or assignment, as the case may be, of all or part of the Registered Covered Bond in accordance with the applicable Conditions, and shall, in each case, give to the Registrar all relevant details required by it to maintain the relevant Register; 

 

	   	
 (b) 

	
 keep a stock of the forms of Transfer Certificates and N Covered Bond Assignment Agreements (each to be provided by the Issuer) and make such forms available on demand to holders of the Covered Bonds; 

 

	   	
 (c) 

	
 immediately, and in any event within three business days (being days when banks are open for business in the city in which the specified office of the Registrar is located)of the relevant request (or such longer period as may be required to comply with any applicable fiscal or other laws or regulations), (i) upon receipt by it of Registered Definitive Covered Bonds for transfer (together with any certifications required by it including, but not limited to, a Transfer Certificate or, with respect to an N Covered  Bond, the duly executed N Covered Bond Assignment Agreement) or (ii) following the endorsement of a reduction in nominal amount of a Registered Global Covered Bond for exchange into Registered Definitive Covered Bonds, authenticate and deliver at its specified office to the transferee or (at the risk of the transferee) send to the address requested by the transferee duly dated and completed Registered Definitive Covered Bonds of a like aggregate nominal amount to the Registered Definitive Covered Bonds transferred and, in the case of the transfer of part only of a Registered Definitive Covered Bond (other than an N Covered  Bond), authenticate and deliver at its specified office to the transferor or (at the risk of the transferor) send to the address requested by the transferor a duly dated and completed Registered Definitive Covered Bond in respect of the balance of the Registered Definitive Covered Bonds not so transferred; 

 

	   	
 (d) 

	
 if appropriate, charge to the holder of a Registered Covered Bond presented for exchange or transfer (i) the costs and expenses (if any) of delivering Registered Definitive Covered Bonds issued on exchange or transfer other than by regular uninsured mail and (ii) a sum sufficient to cover any stamp duty, tax or other governmental charge that may be imposed in relation to the registration and, in each case, account to the Registrar for those charges; and 

 

    

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 (e) 

	
 at the request of any Paying Agent deliver new Registered Covered Bonds (other than an N Covered  Bond) to be issued on partial redemptions of a Registered Covered Bond. 

 

 Indemnity 

 

 12.03     Each of the Transfer Agents shall severally indemnify the Issuer and Guarantor LP against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which the Issuer and the Guarantor LP may incur, otherwise than by reason of the Issuer’s or Guarantor LP’s own negligence or wilful misconduct, as a result or arising out of or in relation to any material breach by such Transfer Agent of the terms of this Agreement which results from such Transfer Agent’s own negligence or wilful misconduct. 

 

 Section 13.      Appointment and Duties of the Calculation Agent 

 

 Appointment 

 

 13.01    The Issuer and Guarantor LP appoint the Issuing and Paying Agent at its specified office as Calculation Agent in relation to each Series of Covered Bonds in respect of which it is named as such in the applicable Final Terms for the purposes specified in this Agreement and in the Conditions and all matters incidental thereto. 

 

 13.02    The Issuing and Paying Agent will confirm to the Issuer and the Guarantor LP whether it is willing to accept its appointment as Calculation Agent in relation to each Series of Covered Bonds in respect of which it is to be named as such in the applicable Final Terms and, provided that it has agreed to such appointment, shall perform all matters expressed to be performed by it in, and otherwise comply with, the Conditions and the provisions of this Agreement and, in connection therewith, shall take all such action as may be incidental thereto.  If the Issuing and Paying Agent declines to accept its appointment as Calculation Agent in respect of a Series of Covered Bonds the Issuer agrees to appoint another institution as Calculation Agent. 

 

 Calculations and Determinations 

 

 13.03     The Calculation Agent shall in respect of each Series of Covered Bonds in relation to which it is appointed as such: 

 

	   	
 (a) 

	
 obtain such quotes and rates and/or make such determinations, calculations, adjustments, notifications and publications as may be required to be made by it by the Conditions at the times and otherwise in accordance with the Conditions; and 

 

	   	
 (b) 

	
 maintain a record of all quotations obtained by it and of all amounts, rates and other items determined or calculated by it and make such record available for inspection at all reasonable times by the Issuer, the Paying Agents and, in the case of Registered Covered Bonds, the Registrar. 

 

    

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 Indemnity 

 

 13.04    The Calculation Agent shall indemnify the Issuer and Guarantor LP against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which the Issuer and the Guarantor LP may incur, otherwise than by reason of the Issuer’s and Guarantor LP’s own negligence or wilful misconduct, as a result or arising out of or in relation to the Calculation Agent’s own negligence or wilful misconduct. 

 

 Section 14.      Fees and Expenses 

 

 14.01    The Issuer (failing which the Guarantor LP) shall pay to the Issuing and Paying Agent for the account of the other Agents such fees as may have been agreed between the Issuer, Guarantor LP and the Issuing and Paying Agent in respect of the services of the Agents hereunder together with all expenses (including, without limitation, legal fees and any publication, advertising, communication, courier, postage and other out-of-pocket expenses) incurred in connection with its services hereunder (plus any applicable value added tax).  The Issuer (failing which the Guarantor LP) shall pay to any Calculation Agent such fees as may have been agreed between the Issuer, Guarantor LP and such Calculation Agent in respect of its services hereunder together with all expenses (including, without limitation, legal fees and any publication, advertising, communication, courier, postage and other out-of-pocket expenses) incurred in connection with its services hereunder (plus any applicable value added tax). 

 

 14.02    The Issuing and Paying Agent (failing which the Guarantor LP) shall on demand make payment of the fees due to the other Agents and Calculation Agent (plus any applicable value added tax) and will reimburse their expenses (plus any applicable value added tax) promptly after receipt of the relevant moneys from the Issuer or Guarantor LP, as the case may be . 

 

 14.03    The Issuer (failing which the Guarantor LP) shall pay all stamp, registration and other taxes and duties (including any interest and penalties thereon or in connection therewith), other than any FATCA Withholding Tax, which may be payable upon or in connection with the execution and delivery of this Agreement and any letters of appointment under which any Agent or Calculation Agent is appointed as agent hereunder, and shall indemnify each Agent and each Calculation Agent (each an “indemnified party”) against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which it may incur as a result or arising out of or in relation to any failure to pay or delay in paying any of the same.  The foregoing indemnity shall extend also to the employees, officers, directors and agents of such indemnified party and to any person controlling any indemnified party (within the meaning of the Securities Act) and the Issuer (failing which the Guarantor LP) agrees that each indemnified party shall have and hold the covenants of the Issuer and Guarantor LP contained in this sub-Clause 14.03 in trust for the benefit of its respective employees, officers, directors, agents and controlling person. 

 

    

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 Section 15.      Terms of Appointment 

 

 15.01     Each of the Agents and (in the case of (e), (f) and (g)) each Calculation Agent may, in connection with its services hereunder: 

 

	   	
 (a) 

	
 (in the case of Bearer Covered Bonds) except as ordered by a court of competent jurisdiction or as required by law or as otherwise provided therein and notwithstanding any notice to the contrary or any memorandum thereon, treat the bearer of any Covered Bond or Coupon as the absolute owner thereof and make payments thereon accordingly; 

 

	   	
 (b) 

	
 (in the case of Registered Covered Bonds) except as ordered by a court of competent jurisdiction or as required by law, treat the registered holder of any Covered Bond as the absolute owner thereof and make payments thereon accordingly; 

 

	   	
 (c) 

	
 assume that the terms of each Covered Bond, Receipt or Coupon as issued are correct; 

 

	   	
 (d) 

	
 refer any question relating to the ownership of any Covered Bond, Receipt or Coupon or the adequacy or sufficiency of any evidence supplied in connection with the replacement of any Covered Bond, Receipt or Coupon to the Issuer for determination by the Issuer and rely upon any determination so made; 

 

	   	
 (e) 

	
 rely upon the terms of any notice, communication or other document reasonably believed by it to be genuine; 

 

	   	
 (f) 

	
 engage any lawyers or other experts whose advice or services may to it seem necessary and rely upon any advice so obtained and such Paying Agent, such Registrar or, as the case may be, such Calculation Agent shall be protected and shall incur no liability as against the Issuer in respect of any action taken, or suffered to be taken, in accordance with such advice and in good faith; and 

 

	   	
 (g) 

	
 treat itself as being released from any obligation to take any action hereunder which it reasonably expects will result in any expense or liability to it, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. 

 

 15.02    In acting under this Agreement and in connection with the Covered Bonds, each Agent shall act solely as agent of the Issuer and Guarantor LP (or for the purposes only of sub-clause 2.06 above, the Bond Trustee) and will not thereby assume any obligations towards or relationship of agency or trust to or with any other person except as provided in Clause 6.05, 6.07, 14.03 and 15.04 hereof, or be responsible for or liable in respect of the authorisation, validity or legality of any Covered Bond, Receipt or Coupon issued or paid by it hereunder or any act or omission of any other person (including, without limitation, any other party hereto and, in the case of the Calculation Agent, any bank from whom any quote may have been obtained). 

 

    

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 15.03    Each Agent and Calculation Agent may purchase, hold and dispose of Covered Bonds or Coupons and may enter into any transaction (including, among other transactions, any depositary, trust or agency transaction) with any Holders or owners of any Covered Bonds or Coupons or with any other party hereto in the same manner as if it had not been appointed as the agent of the Issuer, Guarantor LP or, for the purposes only of sub-clause 2.06 above, the Bond Trustee, in relation to the Covered Bonds. 

 

 15.04   The Issuer shall indemnify (and failing the Issuer so indemnifying, Guarantor LP agrees to indemnify) each Agent and each Calculation Agent (each, an “indemnified party”) against any claim, demand, action, liability, damages, cost, loss or expense (including, without limitation, legal fees and any applicable value added tax) which it may incur, other than such costs and expenses as are separately agreed to be reimbursed out of the fees payable under Clause 14.01 and otherwise than by reason of its own negligence or wilful misconduct, as a result or arising out of or in relation to its acting as the agent of the Issuer and Guarantor LP (and, for the purposes only of sub-clause 2.06 above, the Bond Trustee) in relation to the Covered Bonds.  The foregoing indemnity shall extend also to the employees, officers, directors and agents of such indemnified party and to any person controlling any indemnified party (within the meaning of the Securities Act) and the Issuer and Guarantor LP agrees that each indemnified party shall have and hold the covenants of the Issuer contained in this Clause 14.04 in trust for the benefit of its respective employees, officers, directors, agents and controlling person. 

 

 15.05    The Agents agree that if any information that is required by the Issuing and Paying Agent to perform the duties set out in the Fifth Schedule becomes known to it, it will provide such information to the Issuing and Paying Agent. 

 

 15.06    The Issuer hereby covenants with the Agents that it will provide the Agents with such information as may be available to the Issuer so as to assist the Agents to determine whether or not such is obliged, in respect of any payments to be made by it pursuant to the Transaction Documents, to make any FATCA Withholding. 

 

 15.07    The obligations of the Agents hereunder shall be several and not joint. 

 

 Section 16.      Changes in Agents 

 

 16.01     Any Agent or Calculation Agent may resign its appointment as the agent of the Issuer or Guarantor LP (and, for the purposes only of sub-clause 2.06 above, the Bond Trustee) hereunder and/or in relation to any Series of Covered Bonds upon the expiration of not less than thirty days’ notice to that effect by such Agent or Calculation Agent to the Issuer, Guarantor LP and the Bond Trustee (with a copy, if necessary, to the Issuing and Paying Agent) provided however, that: 

 

	   	
 (a) 

	
 in relation to any such notice which would otherwise expire within thirty days before or after the maturity date of such Series or any interest or other payment date in relation to any such Series, such notice shall be deemed, in relation to such Series only, to expire on the thirtieth day following such maturity date or, as the case may be, such interest or other payment date; and 

 

    

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 (b) 

	
 in respect of any Series of Covered Bonds, in the case of the Issuing and Paying Agent, the Registrar or the Calculation Agent, the only remaining Paying Agent with its specified office in a city in a Member State of the European Union in the circumstances described in Condition 11.01(iv) or, so long as such Covered Bonds are listed on the London Stock Exchange and/or admitted to listing or trading on any other stock exchange or other relevant authority, the Paying Agent or the Transfer Agent with its specified office in London and/or in such other place as may be required by such other stock exchange or other relevant authority, or, in the circumstances described in Condition 9.04, the Paying Agent with its specified office in New York City or, so long as any of the Registered Global Covered Bonds payable in a Specified Currency other than U.S. dollars are held through DTC or its nominee, the Exchange Agent in New York City, such resignation shall not be effective until a successor thereto has been appointed by the Issuer, Guarantor LP or the Bond Trustee, as the case may be, as its agent in relation to such Series of Covered Bonds or in accordance with Clause 16.05 and notice of such appointment has been given in accordance with the Conditions. 

 

 16.02    The Issuer (in respect of itself only) or Guarantor LP (in respect of itself only) may revoke its appointment of any Agent or Calculation Agent as its agent hereunder and/or in relation to any Series of Covered Bonds (i) by not less than thirty days’ notice to that effect or (ii) where the Agent or the Registrar, as the case may be, is an FFI and does not become, or ceases to be, a Participating FFI, on notice in writing to that effect, to such Agent or Calculation Agent provided however, that in respect of any Series of Covered Bonds, in the case of the Issuing and Paying Agent, the Registrar or the Calculation Agent, the only remaining Paying Agent with its specified office in a city in a Member State of the European Union in the circumstances described in Condition 11.01(iv) or, so long as such Covered Bonds are listed on the London Stock Exchange and/or listed on any other stock exchange, the Paying Agent or the Transfer Agent with its specified office in London and/or in such other place as may be required by such other stock exchange or other relevant authority, and/or in the circumstances described in Condition 9.04, the Paying Agent with its specified office in New York City or, so long as any of the Registered Global Covered Bonds payable in a Specified Currency other than U.S. dollars are held through DTC or its nominee, the Exchange Agent in New York City, such revocation shall not be effective until a successor thereto has been appointed by the Issuer, Guarantor LP or the Bond Trustee as its agent in relation to such Series of Covered Bonds provided, if it is an FFI, that such successor is a Participating FFI, and notice of such appointment has been given in accordance with the Conditions. 

 

 16.03    The appointment of any Agent or Calculation Agent as the agent of the Issuer and Guarantor LP (or the Bond Trustee pursuant to sub-clause 2.06 above) hereunder and in relation to each relevant Series of Covered Bonds shall terminate forthwith if any of the following events or circumstances shall occur or arise, namely: such Agent or Calculation Agent becomes incapable of acting; such Agent or Calculation Agent is adjudged bankrupt or insolvent; such Agent or Calculation Agent files a voluntary petition in bankruptcy or makes an assignment for the benefit of its creditors or consents to the appointment of a receiver, administrator or other similar official of all or any substantial part of its property or admits in writing its inability to pay or meet its debts as they mature or suspends payment thereof; a resolution is passed or an order is made for the winding-up or dissolution of such Agent or Calculation Agent; a receiver, administrator or other similar official of such Agent or Calculation Agent or of all or any substantial part of its property is appointed; an order of any court is entered approving any petition filed by or against such Agent or Calculation Agent under the provisions of any applicable bankruptcy or insolvency law; or any public officer takes charge or control of such Agent or Calculation Agent or of its property or affairs for the purpose of rehabilitation, conservation or liquidation; such Agent or Calculation Agent, as the case may be, is an FFI and does not become, or ceases to be, a Participating FFI, or any event occurs which has analogous effect to any of the foregoing. 

 

    

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 16.04    The Issuer may (and shall where necessary to comply with the Conditions) appoint substitute or additional agents, registrars, exchange agents or transfer agents in relation to the Covered Bonds or any particular Series of Covered Bonds provided, if it is an FFI, that it is a Participating FFI, and shall forthwith notify the other parties hereto thereof, whereupon the parties hereto and such substitute or additional agents shall thereafter have the same rights and obligations among them as would have been the case had they then entered into an agreement in the form mutatis mutandis of this Agreement. 

 

 16.05     If, in relation to any Series of Covered Bonds, any Agent or Calculation Agent gives notice of its resignation in accordance with Clause 16.01, the provisions of paragraph (b) of Clause 16.01 apply and by the tenth day before the expiration of such notice a successor to such Agent or Calculation Agent as the agent of the Issuer in relation to such Covered Bonds has not been appointed by the Issuer, such Agent or Calculation Agent may itself, following such consultation with the Issuer, Guarantor LP and the Bond Trustee as may be practicable in the circumstances, appoint as its successor any reputable and experienced bank or financial institution (which will ensure compliance with the Conditions) provided, if it is an FFI, that it is a Participating FFI, and give notice of such appointment in accordance with the Conditions, whereupon the parties hereto and such successor agent shall thereafter have the same rights and obligations among them as would have been the case had they then entered into an agreement in the form mutatis mutandis of this Agreement. 

 

 16.06     Upon any resignation or revocation becoming effective under this Section 15, the relevant Agent or Calculation Agent shall: 

 

	   	
 (a) 

	
 be released and discharged from its obligations under this Agreement (save that it shall remain entitled to the benefit of and subject to and bound by (as appropriate) the provisions of Clause 9.11, Clause 11.14, Clause 13.04, Clause 14.03, Section 15 and this Section 16); 

 

	   	
 (b) 

	
 repay to the Issuer or Guarantor LP such part of any fee paid to it in accordance with Clause 14.01 as may be agreed between the relevant Agent or Calculation Agent and the Issuer or Guarantor LP; 

 

	   	
 (c) 

	
 in the case of the Issuing and Paying Agent, deliver to the Issuer, Guarantor LP, the Bond Trustee and to the successor Issuing and Paying Agent a copy, certified as true and up-to-date by an officer of the Issuing and Paying Agent, of the records maintained by it in accordance with Section 9; 

 

	   	
 (d) 

	
 in the case of a Registrar, deliver to the Issuer, Guarantor LP, the Bond Trustee and to the successor Registrar a copy, certified as true and up-to-date by an officer of such Registrar, of each of the Registers and other records maintained by it in accordance with Section 11; 

 

    

 -42- 

    

 

	   	
 (e) 

	
 in the case of a Calculation Agent, deliver to the Issuer, Guarantor LP, the Bond Trustee and to the successor Calculation Agent a copy, certified as true and up-to-date by an officer of such Calculation Agent of the records maintained by it in accordance with Clause 13.03; and 

 

	   	
 (f) 

	
 forthwith (upon payment to it of any amount due to it in accordance with Section 14 or Clause 15.04) transfer all moneys and papers (including any unissued Temporary Global Covered Bonds, Permanent Global Covered Bonds, Definitive Covered Bonds, Receipts, Coupons, Talons or, as the case may be, Registered Global Covered Bonds) held by it hereunder to its successor in that capacity and, upon appropriate notice, provide reasonable assistance to such successor for the discharge by it of its duties and responsibilities hereunder. 

 

 16.07    Any corporation into which any Agent or Calculation Agent may be merged or converted, any corporation with which any Agent or Calculation Agent may be consolidated, any corporation resulting from any merger, conversion or consolidation to which any Agent or Calculation Agent shall be a party, or any corporation, partnership, trust or other organisation in whatever form to which any Agent or Calculation Agent shall sell or otherwise transfer all or substantially all of its assets shall, on the date when such merger, consolidation, conversion or transfer becomes effective and to the extent permitted by applicable law, become the successor to such Agent or Calculation Agent as agent of the Issuer hereunder and in relation to the Covered Bonds without any further formality, whereupon the remaining parties hereto and such successor agent or registrar shall thereafter have the same rights and obligations among them as would have been the case had they then entered into an agreement in the form mutatis mutandis of this Agreement and after the said effective date the Agent or Calculation Agent shall be relieved of and fully discharged from all obligations hereunder and in respect of any Covered Bonds whether such obligations arose before or after such transfer and assumption and all references in this agreement to such Agent or Calculation Agent shall be deemed to be references to such successor.  Notice of any such merger, conversion or consolidation shall forthwith be given by such successor to the Issuer and the other parties hereto and in accordance with Condition 16. 

 

 16.08     If any Agent or Calculation Agent decides to change its specified office (which may only be effected within the same metropolitan area) it shall give notice to the Issuer, Guarantor LP and the Bond Trustee (with a copy, if necessary, to the Issuing and Paying Agent) of the address of the new specified office stating the date on which such change is to take effect, which date shall be not less than thirty days after the date of such notice.  The relevant Agent or Calculation Agent shall at its own expense not less than fourteen days prior to the date on which such change is to take effect (unless the appointment of the relevant Agent or Calculation Agent is to terminate pursuant to any of the foregoing provisions of this Section 14 on or prior to the date of such change) publish or cause to be published notice thereof in accordance with the Conditions. 

 

    

 -43- 

    

 

 Section 17.       The Bond Trustee 

 

 17.01    If there is any change in the identity of the Bond Trustee, the parties to this Agreement shall execute such documents and take such action as the successor Bond Trustee and the outgoing Bond Trustee may reasonably require for the purpose of vesting in the successor Bond Trustee the rights and obligations of the outgoing Bond Trustee under this Agreement.  The Guarantor LP shall indemnify the Issuer, Issuing and Paying Agent, Exchange Agent, Registrar, Paying Agents and Transfer Agents for all reasonable costs incurred by the Issuer, Issuing Paying Agent, Exchange Agent, Registrar, Paying Agents, and Transfer Agent in relation to such change. 

 

 17.02    It is hereby acknowledged and agreed that by its execution of this Agreement the Bond Trustee shall not assume or have any of the obligations or liabilities of the Issuer, Guarantor LP, Issuing and Paying Agent, Exchange Agent, Registrar, Paying Agents and Transfer Agents or the Guarantor LP under this Agreement and that the Bond Trustee has agreed to become a party to this Agreement for the purpose only of taking the benefit of this Agreement and agreeing to amendments to this Agreement pursuant to Section 20.  For the avoidance of doubt, the parties to this Agreement acknowledge that the right and obligations of the Bond Trustee are governed by the Trust Deed and the Security Agreement.  Any liberty or right which may be exercised or made in the Bond Trustee’s absolute discretion without any obligation to give reasons therefore and the Bond Trustee shall not be responsible for any liability occasioned by so acting if acting in accordance with the terms of the Trust Deed and the Security Agreement, but without prejudice to the obligations of the Bond Trustee to act reasonably. 

 

 Section 18.       Notices 

 

 All notices and communications hereunder shall be made in writing (by letter or fax), shall be effective upon receipt by the addressee and shall be sent as follows: 

 

	   	 (a)   	 if to the Issuer to it at: 
	   	   	   	   
	   	   	 Address:  	
 Royal Bank of Canada 

 155 Wellington St. West, 14th Floor 

 Toronto, Ontario 

 Canada M5V 3K7 

	   	   	   	   
	   	   	 Attention:   	 Ann Milne, Senior Manager 

 Facsimile number: +1 (416) 976-6056 

	   	   	   	   
	   	 (b)  	 if to the Guarantor LP to it at: 
	   	   	   	   
	   	   	 Address:   	
 155 Wellington St. West, 14th Floor 

 Toronto, Ontario 

 Canada M5V 3K7 

	   	   	   	   
	   	   	 Attention:   	 Ann Milne, Senior Manager 

 Facsimile number: +1 (416) 976-6056 

 

    

 -44- 

    

 

 

	   	
 (c) 

	
 if by the Issuer to the Issuing and Paying Agent to it at: 

	   	   	   	   
	   	   	 Address:  	
 The Bank of New York Mellon, London Branch 

 One Canada Square 

 London  E14 5AL 

 United Kingdom 

	   	   	   	   
	   	   	 Attention:  	 Corporate Trust Administration 

 Facsimile number: +44 (0)207 964 2536 

 Copy facsimile to: +44 1202 689660 

 Email:              corpsovamericas@bnymellon.com 

	   	   	   	   
	   	 (d) 	 if by the Issuer to the European Registrar to it at: 
	   	   	   	   
	   	   	 Address:   	
 The Bank of New York Mellon (Luxembourg) S.A. 

 Aerogolf Centre 

 1A Hoehenhof 

 L-1736 Luxembourg 

	   	   	   	   
	   	   	 Attention: 	 Corporate Trust Services 

 Facsimile number: +1(352) 24 524 204 

	   	   	   	   
	   	   	 (or in the case of an Issuing and Paying Agent and European Registrar not originally a party hereto, specified by notice to the other parties hereto at or about the time of its appointment as the agent of the Issuer); 
	   	   	   	   
	   	
 (e) 

	
 if by the Issuer to the Canadian Registrar and Transfer Agent to it at: 

	   	   	   	   
	   	   	 Address: 	 BNY Trust Company of Canada 

 320 Bay Street, 11th Floor 

 Toronto, Ontario 

 Canada M5H 4A6 

	   	   	   	   
	   	   	 Attention:   	
 Sarfraz Faruk 

 Facsimile number: +1(416) 360-1711 

	   	   	   	   
	   	   	 (or in the case of a Canadian Registrar and Transfer Agent not originally a party hereto, specified by notice to the other parties hereto at or about the time of its appointment as the agent of the Issuer); 

 

    

 -45- 

    

 

	   	
 (f) 

	
 if by the Issuer to the U.S. Registrar, Transfer Agent and Exchange Agent to it at: 

	   	   	   	   
	   	   	 Address:  	

 The Bank of New York Mellon 

 101 Barclay Street, Floor 4E 

 New York, NY 10286 

 USA 

	   	   	   	   
	   	   	 Attention: 	
 Arlene Thelwell 

 Facsimile number: 212-815-5366 

	   	   	   	
 

	   	   	 (or in the case of a U.S. Registrar, Transfer Agent and Exchange Agent not originally a party hereto, specified by notice to the other parties hereto at or about the time of its appointment as the agent of the Issuer); 
	   	   	   
	   	 (g) 	 if to a Agent (otherwise than by the Issuer) to it at the address or fax number specified against its name in the Third Schedule (or, in the case of an Agent not originally a party hereto, as specified by notice to the other parties hereto at or about the time of its appointment as the agent of the Issuer) for the attention of the person or department therein specified (or as aforesaid); 
	   	   	   
	   	
 (h) 

	
 if to a Calculation Agent to it at the address fax number specified by notice to the other parties hereto at or about the time of its appointment as the agent of the Issuer; 

                     

  or, in any case, to such other address or fax number or for the attention of such other person or department as the addressee has by prior notice to the sender specified for the purpose. 

 

 Section 19.       Governing Law 

 

 This Agreement is governed by, and shall be construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein, and each of the parties hereto irrevocably attorns to the jurisdiction of the courts of Ontario. 

 

 Section 20.       Waiver of Jury Trial 

 

 Each of the parties hereto irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding against The Bank of New York Mellon, The Bank of New York Mellon, London Branch, The Bank of New York Mellon (Luxembourg) S.A. or BNY Trust Company of Canada arising out of this Agreement or any transaction contemplated herein and The Bank of New York Mellon, The Bank of New York Mellon, London Branch, The Bank of New York Mellon (Luxembourg) S.A. and BNY Trust Company of Canada hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding against any other party hereto arising out of this Agreement or any transaction contemplated herein. 

 

 Section 21.       Modification 

 

 This Agreement may be amended by further agreement among the parties hereto and without the consent of the Holders of any of the Covered Bonds.  If any such amendment is determined to be material in the opinion of the Guarantor LP, Rating Agency Confirmation shall be required in respect thereof and the Guarantor LP (or the Cash Manager on its behalf) shall deliver notice to each Rating Agencies of any amendment or waiver which does not require Rating Agency Confirmation provided that failure to deliver such notice shall not constitute a breach of the obligations of the Guarantor LP under this Agreement. 

 

    

 -46- 

    

 

 Section 22.       Non-Petition 

 

 The Issuer and all of the other parties hereto (other than the Bond Trustee) agree that they shall not institute or join any other Person or entity in instituting against, or with respect to, the Guarantor LP, or any of the general partners of the Guarantor LP, any bankruptcy or insolvency event so long as any Covered Bonds issued by the Issuer under the Programme shall be outstanding or there shall not have elapsed one year plus one day since the last day on which any such Covered Bonds shall have been outstanding.  The foregoing provision shall survive the termination of this Agreement by any of the parties hereto. 

 

 Section 23.       No Indirect Damages 

 

 Notwithstanding anything contained herein, in no event shall any party hereto be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether such party has been advised of the likelihood of such loss or damage and regardless of the form of action. 

 

 Section 24.       Counterparts 

 

 This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when so executed shall constitute one and the same binding agreement between the parties. 

 

 Section 25.       No Indirect Damages 

 

 Notwithstanding anything contained herein, in no event shall any party hereto be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether such party has been advised of the likelihood of such loss or damage and regardless of the form of action. 

 

 Section 26.       Force Majeure 

 

 In no event shall The Bank of New York Mellon be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the The Bank of New York Mellon shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances. 

 

    

 -47- 

    

 

 IN WITNESS whereof this Agreement has been entered into as of the day and year first above  written. 

 

 

	    	
 ROYAL BANK OF CANADA 

 

 

	    	
 Per: 

	 /s/ James Salem 
	    	    	
 Name: James Salem 

	    	    	
 Title: Senior Vice-President and Treasurer 

	    	    	    
	   	   	   
	    	
 Per: 

	 /s/ David Power 
	    	    	
 Name: David Power 

	    	    	
 Title: Vice-President, Corporate Treasury 

 

	    	

 RBC COVERED BOND GUARANTOR  

 LIMITED PARTNERSHIP, by its managing  

 general partner, RBC COVERED BOND GP INC. 

 as Guarantor 

 

	    	
 Per: 

	 /s/ David Power 
	    	    	

 Name: David Power 

	    	    	

 Title: President 

 

 

	    	

 BANK OF NEW YORK MELLON,  

 LONDON BRANCH 

 as Issuing and Paying Agent and Transfer Agent 

 

	    	
 Per: 

	

 /s/ Beth A. Kleeh 

	    	    	
 Name: Beth A. Kleeh 

	    	    	
 Title: Vice President 

	    	    	    
	   	   	   
	    	
 Per: 

	    
	    	    	
 Name: 

	    	    	
 Title: 

 

 Amended and Restated Agency Agreement (signature page) 

    

    

 

	    	
 THE BANK OF NEW YORK MELLON  

 (LUXEMBOURG) S.A. 

 as European Registrar 

 

 

	    	
 Per: 

	 /s/ Beth A. Kleeh 
	    	    	
 Name: Beth A. Kleeh 

	    	    	
 Title: Vice President 

	    	    	    
	    	
 Per: 

	    
	    	    	
 Name: 

	    	    	
 Title: 

 

 

	    	
 BNY TRUST COMPANY OF CANADA 

 as Canadian Registrar and Transfer Agent 

 

 

	    	
 Per: 

	 /s/ Farhan Mir 
	    	    	
 Name: Farhan Mir 

	    	    	
 Title: Authorized Signatory 

	    	    	    
	    	
 Per: 

	    
	    	    	
 Name: 

	    	    	
 Title: 

 

 

	    	

 COMPUTERSHARE TRUST COMPANY  

 OF CANADA 

 as Bond Trustee 

 

	    	
 Per: 

	 /s/ Mircho Mirchev 
	    	    	
 Name: Mircho Mirchev 

	    	    	
 Title: Corporate Trust Officer 

	    	    	    
	    	
 Per: 

	 /s/ Ann Samuel 
	    	    	
 Name: Ann Samuel 

	    	    	
 Title: Associate Trust Officer 

 

 

	    	

 THE BANK OF NEW YORK MELLON 

 as U.S. Registrar, U.S. Paying Agent, Exchange  

 Agent and Transfer Agent 

 

	    	
 Per: 

	 /s/ Beth A. Kleeh 
	    	    	
 Name: Beth A. Kleeh 

	    	    	
 Title: Vice President 

 

 Amended and Restated Agency Agreement (signature page) 

    

    

 

 THE FIRST SCHEDULE 

 Form of Transfer Certificate 

 

 [This certificate is not required for transfers of interests in a Registered Global Covered Bond to persons who wish to hold the transferred interest in the same Registered Global Covered Bond.  This certificate is not applicable to N Covered Bonds] 

 

 [DATE] 

 

 To:           [●] 

 

 (as Issuing and Paying Agent) 

 

 [●] 

 

 (as Registrar) 

 

 Royal Bank of Canada 

 

 (as Issuer) 

 

 RBC Covered Bond Guarantor Limited Partnership 

 

 (as Guarantor LP) 

 

 

 

 ROYAL BANK OF CANADA 

 as Issuer 

 RBC COVERED BOND LIMITED PARTNERSHIP 

 as Guarantor LP 

 [Title of Series of Covered Bonds] (the Covered Bonds) 

 issued pursuant to a Global Covered Bond Programme (the “Programme”) 

 

 Reference is made to the terms and conditions of the Covered Bonds (the “Conditions”) set out in Schedule 1 to the Amended and Restated Trust Deed (the “Trust Deed”) dated as of June 29, 2012, as supplemented, amended, novated or restated from time to time, between, inter alios, the Issuer, Guarantor LP and the Bond Trustee named in it relating to the Programme. Terms defined in the Conditions and the Trust Deed shall have the same meanings when used in this Certificate unless otherwise stated. 

 

 This certificate relates to [insert Specified Currency and nominal amount of Covered Bonds] of Covered Bonds which are held in the form of [beneficial interests in one or more Regulation S Covered Bonds (ISIN No. [specify]) represented by a Regulation S Global Covered Bond]* [beneficial interests in one or more Rule 144A Covered Bonds (ISIN No. [specify]) represented by a Rule 144A Global Covered Bond] [Registered Definitive Covered Bonds (ISIN No. ● [specify]] in the name of [transferor] (the “Transferor”). The Transferor has requested an exchange or transfer of [such beneficial interest in]* the above Covered Bonds for [a beneficial interest in] [Regulation S Covered Bonds represented by a Regulation S Global Covered Bond]* [Rule 144A Covered Bonds represented by a Rule 144A Global Covered Bond]*] * [Registered Definitive Covered Bonds] *. 

 

 *  Delete as appropriate. 

 

    

    

    

 

 In connection therewith, the Transferor certifies that such exchange or transfer has been effected in accordance with the transfer restrictions set forth in the Covered Bonds and in accordance with any applicable securities laws of the United States of America, any State of the United States of America and any other applicable jurisdiction and any applicable rules and regulations of DTC, CDS, Euroclear and Clearstream, Luxembourg from time to time and, accordingly, the Transferor certifies as follows (terms used in this paragraph that are defined in Rule 144A or in Regulation S are used herein as defined therein): 

 

 EITHER: 

 

 [(1)           the offer of the Covered Bonds was not made to a person in the United States; 

 

 (2)           either (i) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither the Transferor nor any person acting on the Transferor’s behalf knows that the transaction was pre-arranged with a transferee in the United States or (ii) the transferee is outside the United States, or the Transferor and any person acting on its behalf reasonably believe that the transferee is outside the United States; 

 

 (3)           no directed selling efforts have been made by the Transferor, or affiliate or any person acting on their behalf within the meaning of Rule 902(c) of Regulation S; [and] 

 

 [(4)           in the case of a transfer of a beneficial interest in a Regulation S Global Covered Bond registered in the name of a nominee for DTC, if such transfer is being made prior to the expiry of the applicable Distribution Compliance Period, the interests in the Covered Bonds being transferred will be held immediately thereafter through Euroclear and/or Clearstream, Luxembourg and/or CDS; and]1 

 

 (4)           the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.]2 

 

 OR: 

 

 [Such Covered Bonds are being transferred in accordance with Rule 144A to a transferee that the Transferor reasonably believes is a “qualified institutional buyer” within the meaning of Rule 144A, purchasing the Covered Bonds for its own account or for the account of a qualified institutional buyer in each case in a transaction meeting the requirements of Rule 144A and in accordance with any applicable securities laws of any state of the United States or any other jurisdiction.]3 

 

 1               Include as applicable. 

 2               Include as applicable. [Relevant only if the proposed transfer or exchange is being made to a person who will hold in the form of a Definitive Regulation S Covered Bond or for a beneficial interest in one or more Regulation S Global Covered Bonds.] 

 3               Include as applicable. [Relevant only if the proposed transfer or exchange is being made to a person who will hold in the form of a Definitive Rule 144A Covered Bond  or for a beneficial interest in one or more Rule 144A Global Covered Bonds.] 

 

    

    

    

 

 The Transferor understands that this certificate is required in connection with certain securities or other legislation in the United States and/or in connection with the Covered Bonds being eligible for clearance in one or more clearance systems. If administrative or legal proceedings are commenced or threatened in connection with which this certificate is or might be relevant, the Transferor irrevocably authorises each entity to which this certificate is addressed to produce this certificate or a copy hereof to any interested party in such proceedings. 

 

 This certificate and the statements contained herein are made for the benefit of the addressees hereof and for the benefit of the Dealers of the Covered Bonds. 

 

 [Insert name of Transferor] 

 

 By: 

 

 

 

 

 Name: 

 

 Title: 

 

 Dated: 

  

 

 

 

 

    

    

    

 

 THE SECOND SCHEDULE 

 Regulations concerning Transfers of Registered Covered Bonds (other than N Covered Bonds) 

 

 1.           Each Registered Covered Bond shall be in a principal amount equal to the minimum denomination specified in the applicable Final Terms, a multiple thereof or the minimum denomination plus higher integral multiples of another smaller amount specified in the applicable Final Terms. 

 

 2.           Registered Covered Bonds are transferable in a principal amount equal to the minimum denomination specified in the applicable Final Terms by execution of the form of transfer endorsed thereon under the hand of the transferor or of a duly appointed attorney on its behalf or, where the transferor is a corporation, under its seal or signed on its behalf by its duly appointed attorney or a duly authorised officer or officers of the corporation.  In this Schedule, “transferor” shall where the context permits or requires include joint transferors and be construed accordingly. 

 

 3.           The Registered Covered Bond transferred may be delivered for registration of transfer to the specified office of the Registrar accompanied by such documents, evidence and information (including, but not limited to, the Transfer Certificate) as may be required pursuant to the Conditions and such other evidence as the Registrar may reasonably require to prove the title of the transferor or his right to transfer the Registered Covered Bond and his identity and, if the form of transfer is executed by some other person on his behalf or in the case of the execution of a form of transfer on behalf of a corporation by an officer or officers or an attorney, the authority of that person or those persons to do so. The signature of the person effecting a transfer of a Registered Covered Bond shall conform to any list of duly authorised specimen signatures supplied by the registered Holder or be certified by a recognised bank, notary public or in such other manner as the Registrar may require. 

 

 4.           The heir or personal representative of a deceased Holder of a Registered Covered Bond or the personal representative of the heirs of a deceased Holder of a Registered Covered Bond (not being one of several joint Holders) and, in the case of the death of one or more of joint Holders, the survivor or survivors of such joint Holders, shall be the only persons recognised by the Issuer as having any title to such Registered Covered Bonds. 

 

 5.           Any person becoming entitled to Registered Covered Bonds in consequence of the death or bankruptcy of the Holder of such Registered Covered Bonds may, upon producing such evidence that he holds the position in respect of which he proposes to act under this paragraph or of his title as the Registrar shall require (including legal opinions), be registered himself as the Holder of such Registered Covered Bonds or, subject to the preceding paragraphs as to transfer, may transfer such Registered Covered Bonds.  The Issuer and the Registrar may retain any amount payable upon the Registered Covered Bonds to which any person is so entitled until such person shall be so registered or shall duly transfer the Registered Covered Bonds. 

 

 6.           Unless otherwise requested by him and agreed by the Issuer, the Holder of Registered Covered Bonds, shall be entitled to receive only one Registered Covered Bond in respect of his entire holding of the Series. 

 

    

    

    

 

 7.           The joint Holders of a Registered Covered Bond shall be entitled to one Registered Covered Bond only in respect of their joint holding which shall, except where they otherwise direct, be delivered to the joint Holder whose name appears first in the Register in respect of the joint holding. 

 

 8.           Where there is more than one transferee (to hold other than as joint Holders) separate forms of transfer (obtainable from the specified office of the Registrar) must be completed in respect of each new holding. 

 

 9.           Where a Holder of a Registered Covered Bond has transferred part only of his holding comprised therein there shall be delivered to him a Registered Covered Bond in respect of the balance of such holding. 

 

 10.         The Issuer, the Registrar and the Issuing and Paying Agent shall, save in the case of the issue of replacement Registered Covered Bonds, make no charge to the Holders for the registration of any holding of Registered Covered Bonds or any transfer of Registered Covered Bonds or for the issue of any Registered Covered Bonds or for the delivery of Registered Covered Bonds at the specified office of the Registrar. 

 

 11.           Subject always to the Conditions, the Registrar will within three Relevant Banking Days of the date of a request for the registration of a transfer of Registered Covered Bonds make available at its specified office (or, at the option of the Holder requesting the exchange or transfer, mail by uninsured post at the risk of the Holder(s) entitled thereto to such address(es) as may be specified by such Holder) a new Registered Covered Bond in respect of the Registered Covered Bond transferred or in respect of Bearer Covered Bonds the subject of a request for an exchange for Registered Covered Bonds.  In the case of a transfer of part only of a Registered Covered Bond, a new Registered Covered Bond in respect of the balance of the Registered Covered Bond transferred will be so delivered to the transferor. 

 

 12.         A Registered Covered Bond may not be exchanged for a Bearer Covered Bond or vice versa. 

 

 13.         Registered Covered Bonds shall bear the legends set out in Part 3 of Schedule 3 to the Trust Deed (the “Legend”), such Covered Bonds being referred to herein as “Legended Covered Bonds”.  Upon the transfer, exchange or replacement of Legended Covered Bonds, or upon specific request for removal of the Legend, the Registrar shall deliver only Legended Covered Bonds or refuse to remove such Legend, as the case may be, unless there is delivered to the Issuer such satisfactory evidence as may reasonably be required by the Issuer, which may include an opinion of U.S. counsel, that neither the Legend nor the restrictions on transfer set forth in it are required to ensure compliance with the provisions of the Securities Act. 

 

    

    

    

 

 THE THIRD SCHEDULE 

 The Specified Offices of the Paying Agents, the Registrars, the Transfer Agents, the Exchange Agent and the Calculation Agent 

 

 The Issuing and Paying Agent, Transfer Agent and Calculation Agent: 

 

 The Bank of New York Mellon, London Branch 

 One Canada Square 

 London  E15 5AL 

 

 Fax:                  +44 (0)207 964 2536 

 Attention:      Manager, EMEA Corporate & Sovereign 

 

 The European Registrar: 

 

 The Bank of New York Mellon (Luxembourg) S.A. 

 Aerogolf Centre 

 1A Hoehenhof 

 L-1736 Luxembourg 

 

 Attention:       Corporate Trust Services 

 Facsimile number: +1(352) 24 524 204 

 

 The Canadian Registrar and Transfer Agent: 

 

 BNY Trust Company of Canada 

 320 Bay Street, 11th Floor 

 Toronto, Ontario 

 Canada M5H 4A6 

 

 Attention:      Sarfraz Faruk 

 Facsimile number: +1(416) 360-1711 

 

 The U.S. Registrar, Paying Agent, Transfer Agent and Exchange Agent 

 

 The Bank of New York Mellon 

 101 Barclay Street, Floor 4E 

 New York, NY 10286, USA 

 

 Fax:                  212-815-5366 

 Attention:       Arlene Thelwell 

 

    

    

    

 

 THE FOURTH SCHEDULE 

 Calculation Agent Appointment Letter 

 [for use if the Calculation Agent is a Dealer] 

 

 

 [On letterhead of the Issuer] 

 

 

 

 

 

 [Date] 

 

  

 [Name of Calculation Agent] 

 [Address] 

 

 

 Dear Sirs, 

 

 ROYAL BANK OF CANADA 

 Programme for the Issuance of Covered Bonds 

 

 We refer to the Amended and Restated Agency Agreement dated as of June 29, 2012 entered into in respect of the above Programme for the Issuance of Covered Bonds (such agreement, as modified or amended from time to time, the “Agency Agreement”) between ourselves as Issuer, Royal Bank of Canada, London branch as, inter alia, Issuing and Paying Agent and European Registrar and certain other financial institutions named therein, a copy of which has been supplied to you by us. 

 

 Words and expressions defined in the Agency Agreement shall have the same meanings when used herein. 

 

 EITHER 

 

 [We hereby appoint you as Calculation Agent at your specified office detailed in the Confirmation as our agent in relation to [specify relevant Series of Covered Bonds] (the “Covered Bonds”) upon the terms of the Agency Agreement for the purposes specified in the Agency Agreement and in the Conditions and all matters incidental thereto.] 

 

 OR 

 

 [We hereby appoint you as Calculation Agent at your specified office detailed in the Confirmation set out below as our agent in relation to each Series of Covered Bonds in respect of which you are named as Calculation Agent in the applicable Final Terms upon the terms of the Agency Agreement.] 

 

 Yours truly, 

 

 ROYAL BANK OF CANADA

 

 By: 

 

 

 By: 

 

    

    

    

 

 CONFIRMATION 

 

 EITHER 

 

 [We hereby accept our appointment as Calculation Agent of the Issuer in relation to the Covered Bonds, and shall perform all matters expressed to be performed by the Calculation Agent in, and shall otherwise comply with, the Conditions and the provisions of the Agency Agreement and, in connection therewith, shall take all such action as may be incidental thereto.] 

 

 OR 

 

 [We hereby accept our appointment as Calculation Agent of the Issuer in relation to each Series Covered Bonds in respect of which we are named as Calculation Agent in the applicable Final Terms and shall perform all matters expressed to be performed by the Calculation Agent in, and shall otherwise comply with (in relation to each such Series of Covered Bonds) the Conditions and the provision of the Agency Agreement and, in connection therewith, shall take all such action as may be incidental thereto.] 

 

 For the purposes of [the Covered Bonds] [each such Series of Covered Bonds] and the Agency Agreement our specified office and communication details are as follows: 

 

 

 

 Address:           [ 

 

                                                           ] 

 Fax:                    [              ] 

 Attention:         [              ] 

 

 [Calculation Agent] 

 

 By: 

 

 Date: 

 

    

    

    

 

 THE FIFTH SCHEDULE 

 Duties under the Issuer-ICSDs Agreement 

 

 In relation to each Series of Covered Bonds that are NGCBs or Registered Global Covered Bonds to be held under the NSS (“NSSCBs”), the Issuing and Paying Agent or the European Registrar, as the case may be, will comply with the following provisions: 

 

	
 1. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will inform each of Euroclear and Clearstream, Luxembourg (the “ICSDs”), through the common service provider appointed by the ICSDs to service the Covered Bonds (the “Common Service Provider”), of the initial issue outstanding amount (“IOA”) for each Tranche on or prior to the relevant Issue Date. 

 

	
 2. 

	
 If any event occurs that requires a mark up or mark down of the records which an ICSD holds for its customers to reflect such customers’ interest in the Covered Bonds the Issuing and Paying Agent or the European Registrar, as the case may be, will (to the extent known to it) promptly provide details of the amount of such mark up or mark down, together with a description of the event that requires it, to the ICSDs (through the Common Service Provider) to ensure that the IOA of the NGCBs or the records of the ICSDs reflecting the IOA of the NSSCBs remain(s) remains at all times accurate. 

 

	
 3. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will perform a reconciliation process with the ICSDs (through the Common Service Provider) with respect to the IOA maintained by the ICSDs for the NGCBs or the records of the ICSDs reflecting the IOA of the NSSCBs at least monthly and will promptly inform the ICSDs (through the Common Service Provider) of any discrepancies. 

 

	
 4. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will promptly assist the ICSDs (through the Common Service Provider) in resolving any discrepancy identified in the IOA of the NGCBs or in the records of the ICSDs reflecting the IOA of the NSSCBs. 

 

	
 5. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will promptly provide to the ICSDs (through the Common Service Provider) details of all amounts paid by it under the Covered Bonds (or, where the Covered Bonds provide for delivery of assets other than cash, of the assets so delivered). 

 

	
 6. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will (to the extent known to it) promptly provide to the ICSDs (through the Common Service Provider) notice of any changes to the Covered Bonds that will affect the amount of, or date for, any payment due under the Covered Bonds. 

 

    

    

    

 

	
 7. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will (to the extent known to it) promptly provide to the ICSDs (through the Common Service Provider) copies of all information that is given to the holders of the Covered Bonds. 

 

	
 8. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will promptly pass on to the relevant Issuer all communications it receives from the ICSDs directly or through the Common Service Provider relating to the Covered Bonds. 

 

	
 9. 

	
 The Issuing and Paying Agent or the European Registrar, as the case may be, will (to the extent known to it) promptly notify the ICSDs (through the Common Service Provider) of any failure by the relevant Issuer to make any payment or delivery due under the Covered Bonds when due.ex4_8.htm

 Exhibit 4.8 

 AMENDED AND RESTATED 

 LIMITED PARTNERSHIP AGREEMENT 

 of 

 

 RBC COVERED BOND GUARANTOR LIMITED PARTNERSHIP 

 

 by and among 

 

 RBC COVERED BOND GP INC. 

 

 as Managing General Partner 

 

 and 

 

 6848320 CANADA INC. 

 

 as Liquidation General Partner 

 

 and 

 

 ROYAL BANK OF CANADA 

 

 as Limited Partner 

 

 and 

 

 Each Person who is admitted to the Limited Partnership as a General Partner or Limited Partner hereafter 

 

 and 

 

 COMPUTERSHARE TRUST COMPANY OF CANADA 

 

 as Bond Trustee 

 

 

 June 29, 2012 

 

 

    

    

    

 

 TABLE OF CONTENTS 

 

 

	
 ARTICLE 1 INTERPRETATION 

	
 2 

	   	   
	
 Section 1.1 

	
 Definitions and Construction. 

	
 2 

	   	   	   
	
 ARTICLE 2 RELATIONSHIP AMONG PARTNERS 

	
 2 

	   	   
	
 Section 2.1 

	
 Formation of Partnership. 

	
 2 

	
 Section 2.2 

	
 Name of Partnership. 

	
 2 

	
 Section 2.3 

	
 Business of the Partnership. 

	
 3 

	
 Section 2.4 

	
 Principal Place of Business. 

	
 3 

	
 Section 2.5 

	
 Financial Year. 

	
 3 

	
 Section 2.6 

	
 Term. 

	
 3 

	
 Section 2.7 

	
 Private Issuer Restrictions. 

	
 3 

	
 Section 2.8 

	
 Representations, Warranties and Covenants of the Managing GP and the Liquidation GP. 

	
 4 

	
 Section 2.9 

	
 Additional Representations and Warranties of the Liquidation GP and the Managing GP. 

	
 5 

	
 Section 2.10 

	
 Representations, Warranties and Covenants of the Limited Partner. 

	
 6 

	
 Section 2.11 

	
 Limitation on Authority of Limited Partners. 

	
 6 

	
 Section 2.12 

	
 Power of Attorney. 

	
 7 

	
 Section 2.13 

	
 Unlimited Liability of the Managing GP and the Liquidation GP; Limitation of Liability. 

	
 8 

	
 Section 2.14 

	
 Limited Liability of Limited Partners. 

	
 9 

	
 Section 2.15 

	
 Indemnity of Limited Partner. 

	
 9 

	
 Section 2.16 

	
 Indemnity of the Managing GP and the Liquidation GP. 

	
 10 

	
 Section 2.17 

	
 Compliance with Laws and Waiver of Security Interest in the Guarantor LP. 

	
 10 

	
 Section 2.18 

	
 Other Activities of the Managing GP and the Liquidation GP. 

	
 10 

	
 Section 2.19 

	
 Other Activities of the Limited Partners and the Shareholders, Directors and Officers of the Partners. 

	
 11 

	   	   	   
	
 ARTICLE 3 CAPITAL ACCOUNTS 

	
 12 

	   	   
	
 Section 3.1 

	
 Capital Contributions. 

	
 12 

	
 Section 3.2 

	
 Initial Capital Contributions. 

	
 12 

	
 Section 3.3 

	
 Capital Account Ledger. 

	
 12 

	
 Section 3.4 

	
 Additional Cash Capital Contributions. 

	
 12 

	
 Section 3.5 

	
 Capital Contributions in Kind. 

	
 13 

	
 Section 3.6 

	
 Capital Distributions. 

	
 14 

	
 Section 3.7 

	
 Capital Contribution Balance. 

	
 14 

	
 Section 3.8 

	
 No Interest Payable on Accounts. 

	
 14 

	
 Section 3.9 

	
 Deficit in Accounts. 

	
 14 

	   	   	   
	
 ARTICLE 4 PROFITS, LOSSES AND DISTRIBUTIONS 

	
 15 

	   	   
	
 Section 4.1 

	
 Allocation of Profits and Losses of the Partnership. 

	
 15 

	
 Section 4.2 

	
 Restriction on Withdrawals and Receipts. 

	
 15 

	
 Section 4.3 

	
 Set-Off. 

	
 16 

	
 Section 4.4 

	
 Compliance with Agreements. 

	
 16 

	   	   	   
	
 ARTICLE 5  

	
 16 

	   	   
	 ASSET COVERAGE TEST AND AMORTIZATION TEST 	 16 
	
 Section 5.1 

	
 Asset Coverage Test. 

	
 16 

	
 Section 5.2 

	
 Asset Coverage Test Breach Notice. 

	
 17 

	
 Section 5.3 

	
 Amortization Test. 

	
 17 

	   	   	   
	
 ARTICLE 6  

	
 18 

	   	   
	 PRIORITIES OF PAYMENTS 	 18 
	
 Section 6.1 

	
 Pre-Acceleration Priorities of Payment. 

	
 18 

 

    

 i 

    

	
 Section 6.2 

	
 Priority of Payments at any time an Asset Coverage Test Breach Notice is outstanding  

 but no Covered Bond Guarantee Activation Event has occurred. 

	
 19 

	
 Section 6.3 

	
 Termination Payments, Indemnities and Tax Credits received in respect of the Swap  

 Agreements, premiums received in respect of replacement Swap Agreements. 

	
 20 

	
 Section 6.4 

	
 Guarantee Priority of Payments. 

	
 21 

	
 Section 6.5 

	
 Priority of Payments when Covered Bonds Repaid. 

	
 22 

	   	   	   
	
 ARTICLE 7 SALE OF SELECTED LOANS 

	
 22 

	   	   
	
 Section 7.1 

	
 Sale of Selected Loans. 

	
 22 

	   	   	   
	
 ARTICLE 8 MANAGEMENT OF THE PARTNERSHIP 

	
 23 

	   	   
	
 Section 8.1 

	
 General Authority and Obligations of the Managing GP and the GP. 

	
 23 

	
 Section 8.2 

	
 General Powers of the Managing GP and the Liquidation GP. 

	
 24 

	
 Section 8.3 

	
 Limitation on Authority of the Managing GP and the GP. 

	
 26 

	
 Section 8.4 

	
 Meetings of the Partners. 

	
 27 

	
 Section 8.5 

	
 Title to Property. 

	
 27 

	
 Section 8.6 

	
 Discharge of Duties of the Managing GP and the Liquidation GP. 

	
 28 

	
 Section 8.7 

	
 Reimbursement. 

	
 28 

	
 Section 8.8 

	
 Commingling of Funds. 

	
 28 

	
 Section 8.9 

	
 Execution of Documents 

	
 28 

	
 Section 8.10 

	
 Delegation 

	
 28 

	
 Section 8.11 

	
 Insurance. 

	
 28 

	
 Section 8.12 

	
 Ostensible Authority. 

	
 29 

	
 Section 8.13 

	
 Decisions by Partners following the appointment of a liquidator or receiver to any Partner. 

	
 29 

	   	   	   
	
 ARTICLE 9 REGISTERED OFFICE, BOOKS AND RECORDS AND FINANCIAL INFORMATION 

	
 29 

	   	   
	
 Section 9.1 

	
 Registered Office. 

	
 29 

	
 Section 9.2 

	
 Records. 

	
 29 

	
 Section 9.3 

	
 Books of Account. 

	
 30 

	
 Section 9.4 

	
 Inspection of Record and Books of Account. 

	
 30 

	
 Section 9.5 

	
 Appointment of Guarantor LP Auditor. 

	
 30 

	
 Section 9.6 

	
 Annual Report and Income Tax Information. 

	
 30 

	
 Section 9.7 

	
 Additional Financial Information. 

	
 31 

	
 Section 9.8 

	
 Investing in Substitute Assets and Authorized Investments. 

	
 31 

	   	   	   
	
 ARTICLE 10 NEW LIMITED PARTNERS 

	
 32 

	   	   
	
 Section 10.1 

	
 Transfer. 

	
 32 

	   	   	   
	
 ARTICLE 11 REMOVAL AND RESIGNATION OF THE MANAGING GENERAL PARTNER AND THE LIQUIDATION GENERAL PARTNER 

	
 34 

	   	   
	
 Section 11.1 

	
 Assignment of Interest of Managing GP. 

	
 34 

	
 Section 11.2 

	
 Removal of Managing GP. 

	
 34 

	
 Section 11.3 

	
 Resignation of Managing GP or the Liquidation GP. 

	
 35 

	
 Section 11.4 

	
 Transfer to New Managing GP. 

	
 35 

	
 Section 11.5 

	
 Release. 

	
 35 

	
 Section 11.6 

	
 Transfer of Title to New Managing GP. 

	
 35 

	
 Section 11.7 

	
 New Managing GP. 

	
 35 

	   	   	   
	
 ARTICLE 12 DISSOLUTION OF PARTNERSHIP 

	
 36 

	   	   
	
 Section 12.1 

	
 Events of Dissolution. 

	
 36 

	
 Section 12.2 

	
 Events Not Causing Dissolution. 

	
 36 

	
 Section 12.3 

	
 Receiver. 

	
 36 

	
 Section 12.4 

	
 Liquidation of Assets and Distribution of Proceeds of Liquidation. 

	
 37 

	
 Section 12.5 

	
 Termination of Partnership. 

	
 37 

 

    

 ii 

    

 

	
 ARTICLE 13 AMENDMENTS 

	
 37 

	   	   
	
 Section 13.1 

	
 Generally. 

	
 37 

	
 Section 13.2 

	
 Amendments by the Managing GP. 

	
 38 

	
 Section 13.3 

	
 Notice of Amendment. 

	
 38 

	   	   	   
	
 ARTICLE 14 CONFIDENTIALITY 

	
 39 

	   	   
	
 Section 14.1 

	
 Confidentiality. 

	
 39 

	   	   	   
	
 ARTICLE 15 MISCELLANEOUS 

	
 40 

	   	   
	
 Section 15.1 

	
 Effective Time. 

	
 40 

	
 Section 15.2 

	
 Notices. 

	
 40 

	
 Section 15.3 

	
 Time of the Essence. 

	
 40 

	
 Section 15.4 

	
 Third Party Beneficiaries. 

	
 41 

	
 Section 15.5 

	
 Bond Trustee 

	
 41 

	
 Section 15.6 

	
 Binding Effect 

	
 42 

	
 Section 15.7 

	
 Further Assurances. 

	
 42 

	
 Section 15.8 

	
 Limited Partner not A GP. 

	
 43 

	
 Section 15.9 

	
 Waiver. 

	
 43 

	
 Section 15.10 

	
 Successors and Assigns. 

	
 43 

	
 Section 15.11 

	
 Severability. 

	
 43 

	
 Section 15.12 

	
 Governing Law. 

	
 43 

	
 Section 15.13 

	
 Counterparts. 

	
 43 

	
 Section 15.14 

	
 No Personal Liability for Limited Partners. 

	
 43 

	
 Section 15.15 

	
 Submission to Jurisdiction. 

	
 44 

 

 SCHEDULES 

 

 Schedule 1 – Additional Liquidation General Partner Representations and Warranties 

 Schedule 2 – Asset Coverage Test 

 Schedule 3 – Amortization Test 

 Schedule 4 – Pre-Acceleration Revenue Priority of Payments 

 Schedule 5 – Pre-Acceleration Principal Priority of Payments 

 Schedule 6 – Guarantee Priority of Payments 

 Schedule 7 – Priority of Payments when Covered Bonds Repaid 

 Schedule 8 – Method for Sale of Selected Loans 

 

    

 iii 

    

 

 AMENDED AND RESTATED 

 LIMITED PARTNERSHIP AGREEMENT 

 

 THIS LIMITED PARTNERSHIP AGREEMENT (this “Agreement”) of RBC Covered Bond Guarantor Limited Partnership (the “Partnership”) was made on October 25, 2007 and most recently amended and restated as of June 29, 2012. 

 

 BY AND AMONG: 

 

	
 (1) 

	
 RBC Covered Bond GP Inc. (the “Managing GP” or “RBC GP”), a corporation incorporated under the laws of Canada; 

 

	
 (2) 

	
 6848320 Canada Inc. (the “Liquidation GP”), a corporation incorporated under the laws of Canada; 

 

	
 (3) 

	
 Royal Bank of Canada (the  “Limited Partner” or the “Bank”), a bank named in Schedule I to the Bank Act (Canada); 

 

	
 (4) 

	
 Computershare Trust Company of Canada (the “Bond Trustee”), a trust company formed under the laws of Canada; and 

 

	
 (5) 

	
 Each Person who is admitted to the Limited Partnership as a General Partner or Limited Partner hereafter. 

 

 RECITALS: 

 

	
    

	
 (a) 

	
 The Managing GP, the Liquidation GP and the Limited Partner established the Partnership under the laws of the Province of Ontario pursuant to a declaration dated October 5, 2007 as amended by a declaration dated October 18, 2007; 

 

	
    

	
 (b) 

	
 the parties hereto entered into a Limited Partnership Agreement dated October 25, 2007, which was most recently amended and restated on March 16, 2010; 

 

	
    

	
 (c) 

	
 the parties hereto desire to amend and restate this Agreement in its entirety; and 

 

	
    

	
 (d) 

	
 the parties hereto are desirous of confirming their agreement respecting the Partnership on the terms and conditions set forth in this Agreement. 

 

 NOW THEREFORE, THIS AGREEMENT WITNESSETH this in consideration of the foregoing and the mutual covenants and agreements contained in this Agreement (the receipt and adequacy of which are acknowledged), the parties agree as follows: 

 

    

 

    

 

 ARTICLE 1 

 INTERPRETATION 

 

	
 Section 1.1 

	
 Definitions and Construction. 

 

 The Master Definitions and Construction Agreement made between the parties to the Transaction Documents on the Programme Establishment Date and most recently amended and restated on June 29, 2012 (as the same may be amended, varied,  supplemented or amended and restated from time to time with the consent of the parties thereto) is expressly and specifically incorporated into this Agreement and, accordingly, the expressions defined in the Master Definitions and Construction Agreement 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 Section 2 of the Master Definitions and Construction Agreement. 

 

 

 ARTICLE 2 

 RELATIONSHIP AMONG PARTNERS 

 

	
 Section 2.1 

	
 Formation of Partnership. 

 

 The Managing GP, the Liquidation GP and the Limited Partner agreed to and formed a limited partnership pursuant to the laws of the Province of Ontario on October 5, 2007. The parties hereto have agreed to confirm their agreements relating to the Partnership on the terms and conditions set out in this Agreement.  The Partnership will be effective as a limited partnership from October 5, 2007, the date on which the Declaration was filed in accordance with the LP Act, and the Partnership will file any documents necessary as a result of the amendments reflected in this Agreement. 

 

	
 Section 2.2 

	
 Name of Partnership. 

 

 Subject to the provisions of the LP Act and the Business Names Act (Ontario) and any other applicable legislation, the name of the Partnership will be RBC Covered Bond Guarantor Limited Partnership, or such other name as the Managing GP may, with the consent of the Limited Partner, and while there are Covered Bonds outstanding, the Bond Trustee, from time to time determine in accordance with the terms of this Agreement. 

 

    

 -2- 

    

 

	
 Section 2.3 

	
 Business of the Partnership. 

 

	
    

	
 (1) 

	
 The Partners have agreed with effect from the date hereof that the sole business of the Partnership shall be to provide services to the Bank in respect of the Programme by entering into the Intercompany Loan Agreement and accepting Capital Contributions from the Partners; using the proceeds from the Intercompany Loan and Capital Contributions (i) to purchase the Initial Covered Bond Portfolio consisting of Loans and their Related Security from the Seller in accordance with the terms of the Mortgage Sale Agreement and additional Covered Bond Portfolios of New Loans and their Related Security pursuant to the terms of the Mortgage Sale Agreement; and/or (ii) to invest in Substitute Assets in an amount not exceeding the prescribed limit and Authorized Investments; and/or (iii) subject to complying with the Asset Coverage Test to from time to time make Capital Distributions to the Limited Partner; and/or (iv) to make deposits of the proceeds in the Guarantor LP Accounts (including, without limitation, to fund the Reserve Fund to an amount not exceeding the prescribed limit); and/or (v) arranging for the servicing of the Covered Bond Portfolio by the Servicer; and/or (vi) entering into the Trust Deed, giving the Covered Bond Guarantee and entering into the Security Agreement; and/or (vii) entering into the other Transaction Documents to which it is a party; and (viii) performing its obligations hereunder and thereunder and in respect thereof and doing all things incidental or ancillary thereto. 

 

	
 Section 2.4 

	
 Principal Place of Business. 

 

	
    

	
 (1) 

	
 The principal office of the Partnership will be located at 155 Wellington Street, West, 14th Floor, Toronto, Ontario, Canada M5V 3K7 and/or at such other place or places in Canada as the Managing GP may from time to time determine. 

 

	
    

	
 (2) 

	
 The Partnership will be permitted to carry on business in any jurisdiction, but the Managing GP will be required in all cases to use its reasonable best efforts to protect the limited liability of the Limited Partner in any such jurisdiction, including by registering the Partnership in other jurisdictions where the Managing GP considers it appropriate to do so. 

 

	
 Section 2.5 

	
 Financial Year. 

 

 The Fiscal Year end for tax and financial reporting purposes will be October 31 in each calendar year or such other date as the Managing GP may determine from time to time, provided that the Managing GP has obtained any necessary consents from applicable taxation authorities. 

 

	
 Section 2.6 

	
 Term. 

 

 The Partnership will exist until it is dissolved in accordance with this Agreement. 

 

	
 Section 2.7 

	
 Private Issuer Restrictions. 

 

 Notwithstanding any other provisions in this Agreement: (i) the number of Partners will be limited to no more than fifty (50), (ii) the right to Transfer any interest in the Partnership is restricted as provided in this Agreement, and (iii) any invitation to the public to subscribe for any interest in the Partnership is prohibited. 

 

    

 -3- 

    

 

 Section 2.8             Representations, Warranties and Covenants of the Managing GP and the Liquidation GP. 

 

	
    

	
 (1) 

	
 The Managing GP represents and warrants to, and covenants with, each other Partner and, while the Covered Bonds are outstanding, the Bond Trustee, that: 

 

	
    

	
 (a) 

	
 it is a corporation duly incorporated under the laws of Canada and is validly subsisting under such laws and has made all filings under all applicable corporate, securities and taxation laws to which the Managing GP is subject, for which the failure to file could have a material adverse affect on the Programme or the Partnership; 

 

	
    

	
 (b) 

	
 it has the capacity and corporate authority to act as the managing general partner of the Partnership and to enter into and perform its obligations under this Agreement and each of the other Transaction Documents to which it is a party, and such obligations do not conflict with nor do they result in a breach of any of its constating documents or by-laws or any agreement by which it is bound; 

 

	
    

	
 (c) 

	
 except pursuant to the obligations of the Partnership under the Covered Bond Guarantee or any of the Transaction Documents, it will not, nor will it cause any of its Affiliates or Associates, to borrow money from the Partnership, or cause the Partnership to lend money to any of its Affiliates or Associates; 

 

	
    

	
 (d) 

	
 it holds and shall maintain the registrations necessary for the conduct of its business and has and shall continue to have all licences and permits necessary to carry on its business as the managing general partner of the Partnership in all jurisdictions where the activities of the Partnership require such licensing or other form of registration of the managing general partner; 

 

	
    

	
 (e) 

	
 it will make all filings in a timely manner respecting the Partnership required pursuant to the applicable legislation; 

 

	
    

	
 (f) 

	
 it will exercise the powers conferred upon it hereunder in pursuance of the business of the Partnership and will devote such time to the conduct of the affairs of the Partnership as may be reasonably required for the proper management of the affairs of the Partnership; and 

 

	
    

	
 (g) 

	
 it is not a Non-resident, and will retain such status during the term of the Partnership. 

 

    

 -4- 

    

 

	
    

	
 (2) 

	
 The Liquidation GP represents and warrants to, and covenants with, each other Partner, and while the Covered Bonds are outstanding, the Bond Trustee, that: 

 

	
    

	
 (a) 

	
 it is a corporation duly incorporated under the laws of Canada and is validly subsisting under such laws and has made all filings under all applicable corporate, securities and taxation laws to which the Liquidation GP is subject, for which the failure to file could have a material adverse affect on the Programme or the Partnership; 

 

	
    

	
 (b) 

	
 it has the capacity and corporate authority to act as the liquidation general partner of the Partnership and to enter into and perform its obligations under this Agreement and each of the other Transaction Documents to which it is a party, and such obligations do not conflict with nor do they result in a breach of any of its constating documents or by-laws or any agreement by which it is bound; 

 

	
    

	
 (c) 

	
 except pursuant to the obligations of the Partnership under the Covered Bond Guarantee or any of the Transaction Documents, it will not, nor will it cause any of its Affiliates or Associates, to borrow money from the Partnership, or cause the Partnership to lend money to any of its Affiliates or Associates; 

 

	
    

	
 (d) 

	
 it holds and shall maintain the registrations necessary for the conduct of its business and has and shall continue to have all licences and permits necessary to carry on its business as the liquidation general partner of the Partnership in all jurisdictions where the activities of the Partnership require such licensing or other form of registration of the liquidation general partner; and 

 

	
    

	
 (e) 

	
 it is not a Non-resident, and will retain such status during the term of the Partnership. 

 

	
    

	
 (3) 

	
 The representations, warranties and covenants contained in this Section 2.8 will survive the execution and delivery of this Agreement, and the Managing GP and the Liquidation GP will be obliged to ensure the continuing accuracy of each of their respective representations and warranties contained in this Section 2.8 throughout the continuation of the Partnership. 

 

 Section 2.9              Additional Representations and Warranties of the Liquidation GP and the Managing GP. 

 

 In addition to the representations and warranties of the Managing GP and the Liquidation GP in Section 2.8, each of the Liquidation GP and the Managing GP further represents and warrants to each other Partner and the Bond Trustee that the representations and warranties set out in Schedule 1 are true as at the date hereof in respect of itself and will be obliged to ensure the continuing accuracy of the representations and warranties in paragraphs (f) to (g) of Schedule 1 throughout the continuation of the Partnership. 

 

    

 -5- 

    

 

 Section 2.10           Representations, Warranties and Covenants of the Limited Partner. 

 

 The Limited Partner represents and warrants to, and covenants with, each other Partner that: 

 

	
    

	
 (a) 

	
 it is a validly created Canadian chartered bank under the laws of Canada and is validly subsisting under such laws; 

 

	
    

	
 (b) 

	
 it has the capacity and corporate authority to enter into and perform its obligations under this Agreement, and such obligations do not conflict with nor do they result in a breach of any of its constating documents or by-laws or any agreement by which it is bound; and 

 

	
    

	
 (c) 

	
 it is not a Non-resident and will retain such status during the term of the Partnership; 

 

	
    

	
 (d) 

	
 it will not transfer any interest it holds in the Partnership to a Non-resident. 

 

 Section 2.11           Limitation on Authority of Limited Partners. 

 

 The Limited Partner in its capacity as Limited Partner will not be entitled to: 

 

	
    

	
 (a) 

	
 take part in the administration, control, management or operation of the business of the Partnership or exercise any power in connection therewith; 

 

	
    

	
 (b) 

	
 transact any business on behalf of the Partnership or make any commitment on behalf of or otherwise obligate or bind the Partnership; 

 

	
    

	
 (c) 

	
 other than by voting on a resolution of the Partners (where the Limited Partner is entitled to so vote), execute any document that binds or purports to bind the Partnership or any other Partner as such; 

 

	
    

	
 (d) 

	
 hold itself out as having the power or authority to bind the Partnership or any other Partner as such; 

 

	
    

	
 (e) 

	
 have any authority to act for or undertake any obligation or responsibility on behalf of the Partnership or any other Partner as such; 

 

    

 -6- 

    

 

	
    

	
 (f) 

	
 bring any action for partition or sale or otherwise in connection with the Partnership, or any interest in any property of the Partnership, whether real or personal, tangible or intangible, or file or register or permit to be filed, registered or remain undischarged any encumbrance in respect of any property of the Partnership; 

 

	
    

	
 (g) 

	
 compel or seek a partition, judicial or otherwise, of any of the assets of the Partnership distributed or to be distributed to the Partners in kind except in accordance with this Agreement; or 

 

	
    

	
 (h) 

	
 take any action that will jeopardize or eliminate the status of the Partnership as a limited partnership. 

 

 Section 2.12           Power of Attorney. 

 

	
    

	
 (1) 

	
 The Limited Partner, by its execution of this Agreement, irrevocably nominates, constitutes and appoints the Managing GP (and in the event of a Managing GP Default, the Liquidation GP), with full power of substitution, as its agent and true and lawful attorney to act on its behalf with full power and authority in its name, place and stead to execute, deliver, swear to, make, file and record when, as and where required in the opinion of the Managing GP (and in the event of a Managing GP Default, the Liquidation GP): 

 

	
    

	
 (a) 

	
 the Declaration, the Record, any amendment to this Agreement made in accordance with the terms of this Agreement and any other document or instrument required to form, qualify, continue and keep in good standing the Partnership as a limited partnership in all jurisdictions in which the Partnership may conduct its business or own property in order to maintain the limited liability of the Limited Partner and to comply with the applicable laws of such jurisdiction; 

 

	
    

	
 (b) 

	
 each of the Transaction Documents to which the Partnership is a party and any amendment thereto, to the extent such amendment is made and approved in accordance with the terms of this Agreement and any other document on behalf of and in the name of the Partnership as may be necessary to give effect to the conduct of the business of the Partnership; 

 

	
    

	
 (c) 

	
 any document or instrument, including without limitation any amendments to the Declaration or the Record, necessary to reflect any amendment to this Agreement made in accordance with the terms of this Agreement; 

 

	
    

	
 (d) 

	
 any document or instrument required in connection with the winding up, dissolution or termination of the Partnership in accordance with the terms of this Agreement; 

 

	
    

	
 (e) 

	
 all elections, determinations, designations and returns or similar documents or instruments under the Income Tax Act, the Excise Tax Act (Canada) or any other taxation or other legislation or laws of like import of Canada or of any provinces or jurisdictions in respect of the affairs of the Partnership or of a Partner’s interest in the Partnership; 

 

    

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 (f) 

	
 any document or instrument required to be filed with the appropriate governmental body, agency or authority in any jurisdiction in connection with the business, property, assets and undertaking of the Partnership; 

 

	
    

	
 (g) 

	
 any document or instrument to give effect to any Transfer of an interest in the Partnership or relating to the admission of additional Limited Partners made in accordance with and subject to the terms and restrictions of this Agreement; 

 

	
    

	
 (h) 

	
 any other instrument or document on behalf of and in the name of the Partnership, including, without limitation, all debt instruments as may be deemed necessary or desirable by the Managing GP to carry out fully this Agreement in accordance with its terms; and 

 

	
    

	
 (i) 

	
 all other instruments and documents on the Limited Partner’s behalf and in the Limited Partner’s name or in the name of the Partnership as may be deemed necessary or desirable by the Managing GP to carry out fully this Agreement in accordance with its terms, 

 

 and hereby ratifies such execution, delivery, swearing, making, recording and filing. 

 

	
    

	
 (2) 

	
 The Limited Partner by execution of this Agreement confirms that the power of attorney granted herein is irrevocable during the continuation of the Partnership and is a power coupled with an interest and will survive its insolvency, dissolution, winding up or bankruptcy and extend to bind its successors and assigns, and may, subject to its terms, be exercised by the Managing GP (and in the event of a Managing GP Default, the Liquidation GP) on behalf of the Limited Partner in executing any instrument.  The Limited Partner agrees to be bound by any representations and actions made or taken in good faith by the Managing GP (and in the event of a Managing GP Default, the Liquidation GP) pursuant to such power of attorney and hereby waives any and all defences that may be available to contest, negate or disaffirm the action of the Managing GP (and in the event of a Managing GP Default, the Liquidation GP) taken in good faith under this power of attorney.  This power of attorney will continue in respect of the Managing GP (and in the event of a Managing GP Default, the Liquidation GP) so long as it is the managing general partner of the Partnership, and will terminate thereafter, but will continue in respect of a New Managing GP as if such New Managing GP were the original attorney. 

 

 Section 2.13           Unlimited Liability of the Managing GP and the Liquidation GP; Limitation of Liability. 

 

	
    

	
 (1) 

	
 The Managing GP and the Liquidation GP will each jointly and severally have unlimited liability for the debts, liabilities and obligations of the Partnership. 

 

    

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 (2) 

	
 Subject to Section 2.14, neither the Managing GP nor the Liquidation GP will be liable to the Limited Partner for any act, omission or error in judgment taken or made hereunder by the Managing GP or the Liquidation GP, as the case may be, honestly and in good faith in the conduct of the business of the Partnership. The Managing GP and the Liquidation GP may rely and act upon and will be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture or other document or instrument believed by it to be genuine and to have been signed or presented by the proper party. The Managing GP and the Liquidation GP may rely and act upon any statement, report or opinion prepared by, or any advice received from, the legal counsel, accountants, investment bankers, experts or other professional advisors of it or the Partnership and, provided it exercised reasonable care in selecting such advisors, neither the Managing GP nor the Liquidation GP will be responsible or held liable for any loss or damage resulting from so relying or acting if it reasonably believed the advice to be within the area of professional competence of the person from whom it was received and it acted honestly and in good faith in relying thereon. 

 

 Section 2.14           Limited Liability of Limited Partners. 

 

 Subject to the provisions of the LP Act and of such similar legislation in Canada and elsewhere as is applicable to the Partnership, the liability of the Limited Partner for the debts, liabilities and obligations of the Partnership will be limited to its Capital Contribution Balance and solely to the extent required by applicable law, the amount of any Capital Distributions received by it. 

 

 Section 2.15           Indemnity of Limited Partner. 

 

	
    

	
 (1) 

	
 The Managing GP and the Liquidation GP (solely to the extent of its authority under the terms of this Agreement) will operate the Partnership to ensure to the greatest extent possible the limited liability of the Limited Partner and will jointly and severally indemnify and hold harmless the Limited Partner and its shareholders, directors, officers, employees and agents from any costs, damages, liabilities or expenses suffered or incurred by the Limited Partner or its shareholders, directors, officers, employees or agents (except to the extent such persons are directors, officers, employees or agents of the Managing GP), as a result of negligence on the part of the Managing GP or the Liquidation GP, as the case may be, in performing its obligations hereunder resulting in the liability of the Limited Partner not being limited in the manner provided in Section 2.14, unless such liability arises out of any act or omission of the Limited Partner.  Payments in respect of this Section 2.15 shall be made solely in accordance with Article 6 (Priorities of Payments). 

 

	
    

	
 (2) 

	
 The Limited Partner will hold the benefit of this indemnity in trust and as agent for its shareholders, directors, officers, employees and agents. 

 

    

 -9- 

    

 

 Section 2.16           Indemnity of the Managing GP and the Liquidation GP. 

 

	
    

	
 (1) 

	
 The Partnership will indemnify and hold harmless the Managing GP and the Liquidation GP, and their respective shareholders, directors, officers, employees and agents, from any costs, damages, liabilities resulting from or arising out of any act or omission or error of judgment of the Managing GP or the Liquidation GP, or any of their respective, shareholders, directors, officers, employees and agents, on behalf of the Partnership or in furtherance of the business of the Partnership unless, in the case of any such person, such costs, damages, liabilities or expenses result from or arise out of any act or omission or error of judgment as a result of which such person is adjudged to have been guilty of negligence or wilful misconduct or to have failed to act honestly and in good faith or to have breached a fiduciary duty to the Partnership or the Limited Partner. This indemnity is in addition to and not a limitation of any other obligation of the Partnership to the Managing GP or the Liquidation GP including the obligation of the Partnership to reimburse or repay the Managing GP and the Liquidation GP on account of costs, outlays, disbursements and expenditures incurred by or on their behalf but this indemnity will not be in derogation of the provisions of Section 2.14.  Payments in respect of this Section 2.15 shall be made solely in accordance with Article 6 (Priorities of Payments). 

 

	
    

	
 (2) 

	
 Subject to complying with Article 6 (Priorities of Payments), the Partnership may purchase and maintain (or reimburse the Managing GP or Liquidation GP insurance) on behalf of such Persons in such amount as the Managing GP (or following a Managing GP Default, the Liquidation GP) may determine, and, while there are Covered Bonds outstanding, with the consent of the Bond Trustee, against any liability that may be asserted against or expense that may be incurred by such Person in connection with the Partnership’s activities, whether or not the Partnership would have the power to indemnify those Persons against those liabilities under the provisions of this Agreement. 

 

	
    

	
 (3) 

	
 The Managing GP and the Liquidation GP will hold the benefit of this indemnity in trust and as agent for their respective shareholders, directors, officers, employees and agents. 

 

 Section 2.17           Compliance with Laws. 

 

 The Limited Partner will, on the request of the Managing GP from time to time, execute, without undue delay, any documents or instruments considered by the Managing GP to be necessary to comply with any applicable law or regulation of the Province of Ontario or any other jurisdiction in which the Partnership carries on business, for the continuation, operation and good standing of the Partnership. 

 

 Section 2.18           Other Activities of the Managing GP and the Liquidation GP. 

 

 Each of the Managing GP and the Liquidation GP shall devote their efforts exclusively to or for the benefit of the Partnership and the business of the Partnership and shall not engage in any business or activity, except the business of the Partnership or any activity ancillary or related thereto or in furtherance thereof. 

 

    

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 Section 2.19           Other Activities of the Limited Partners and the Shareholders, Directors and Officers of the Partners. 

 

	
    

	
 (1) 

	
 The Limited Partner may engage in, or hold an interest in, any other business, venture, investment or activity whether or not similar to or competitive with the business of the Partnership. 

 

	
    

	
 (2) 

	
 Without limiting the foregoing, neither the Limited Partner, nor any shareholder, director, officer or Associate or Affiliate of any Partner shall by reason of its fiduciary position be in any way precluded from: 

 

	
    

	
 (a) 

	
 entering into or being interested in any contract or financial or other transaction or arrangement with the Partnership or any of its Associates or Affiliates (including without limitation any contract, transaction or arrangement of a banking or insurance nature or any contract, transaction or arrangement in relation to the making or assignment of loans or the provision of financial facilities or financial advice to, or the purchase, placing or underwriting of or the subscribing or procuring subscriptions for or otherwise acquiring, holding or dealing with, or acting in any capacity in relation to the Covered Bonds or any other covered bonds, bonds, stocks, shares, debenture stock, debentures or other securities of any of the Partners or any of their respective Associates or Affiliates); 

 

	
    

	
 (b) 

	
 being a partner of any other partnership constituting or securing any other securities issued by or guaranteed by, or relating to that partnership, or any other office of profit under that partnership; or 

 

	
    

	
 (c) 

	
 in providing services to any other partnership or person or entity or carrying on any business (including, without limitation, any business in competition with the Partnership) and including, without limitation, the making or assigning of loans, the provision of financial facilities or financial advice to, or the issue, purchase, placing or underwriting of or the subscribing or procuring subscriptions for or otherwise acquiring, holding or dealing with, or acting in any capacity in relation to any other covered bonds, bonds, stocks, shares, debenture stock, debentures or other securities of any type whatsoever. 

 

    

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 ARTICLE 3 

 CAPITAL ACCOUNTS 

 

 Section 3.1             Capital Contributions. 

 

 The Partners may from time to time make Capital Contributions to the Partnership. 

 

 Section 3.2             Initial Capital Contributions. 

 

 Contemporaneously with the execution of this Agreement on October 25, 2007, the Partners made the following Cash Capital Contributions to the Partnership, which are reflected in such Partner’s Capital Account Ledger. 

 

	
 Partner 

	
 Cash Capital Contribution Amount 

 

	
 Managing GP 

 

	
 $0.05 (in respect of a 0.0495% general partnership interest in the Partnership) 

 

	
  Liquidation GP 

 

	
 $0.01 (in respect of a 0.0005% general partnership interest in the Partnership) 

 

	
 Limited Partner 

 

	
 $99.95 (in respect of a 99.95% limited general partnership interest in the Partnership) 

 

 

 Section 3.3             Capital Account Ledger. 

 

 The Managing GP (or the Cash Manager on its behalf), shall maintain the Capital Account Ledger or sub-ledgers in respect of each Partner. Any increase or decrease in the Capital Contribution Balance of a Partner shall be credited or debited to such Partner's Capital Account Ledger on each Calculation Date.  The Capital Contribution Balance of each Partner as recorded in the Capital Account Ledger from time to time, shall represent such Partner's interest in the capital of the Partnership, provided that at no time shall any the Capital Contribution Balance of the Liquidation GP be greater than, or the Liquidation GP be entitled to a return of capital from the Partnership of greater than, $0.01 unless agreed to by each of the other Partners. 

 

 Section 3.4             Additional Cash Capital Contributions. 

 

	
    

	
 (1) 

	
 Prior to making any additional Cash Capital Contribution to the Partnership, the Limited Partner shall be deemed to have represented and warranted to the Managing GP, the Liquidation GP and, while the Covered Bonds are outstanding, the Bond Trustee, that no Insolvency Event has occurred or will result in respect of the Limited Partner from such Cash Capital Contribution. 

 

    

 -12- 

    

 

	
    

	
 (2) 

	
 The Partnership will from time to time make drawings on the Intercompany Loan. For greater certainty, any amount advanced under the Intercompany Loan Agreement shall not constitute a Capital Contribution on the part of the Limited Partner. 

 

	
    

	
 (3) 

	
 In the event that: 

 

	
    

	
 (a) 

	
 a Borrower takes a Payment Holiday in respect of a Loan in the Covered Bond Portfolio in accordance with the relevant Mortgage Conditions and the amount of the difference, if any, between (i) the unpaid interest and principal associated with that Payment Holiday; and (ii) the amount of any Advance in respect thereof pursuant to Section 5.3 of the Intercompany Loan Agreement, shall be deemed to constitute a Cash Capital Contribution by the Limited Partner; 

 

	
    

	
 (b) 

	
 there is any increase in the True Balance of a Loan due to the Limited Partner making a Further Advance or Line of Credit Loan Drawing to a Borrower occurs, the difference, if any, between (i) such increase; and  (ii) the amount of any Advance in respect thereof pursuant to Section 5.3 of the Intercompany Loan Agreement, shall be deemed to constitute a Cash Capital Contribution by the Limited Partner; or 

 

	
    

	
 (c) 

	
 on any Calculation Date, there is an increase in the Outstanding Principal Balance of Loans in the immediately preceding Calculation Period (being the period between the last most recent Calculation Date and the current Calculation Date) due to Capitalized Interest and/or Capitalized Arrears accruing on a Loan the difference, if any, between (i) such increase; and (ii) the amount of any Advance in respect thereof pursuant to Section 5.3 of the Intercompany Loan Agreement, shall be deemed to constitute a Cash Capital Contribution by the Limited Partner. 

 

 Section 3.5             Capital Contributions in Kind. 

 

	
    

	
 (1) 

	
 From time to time the Limited Partner may sell Loans and other Related Security to the Partnership pursuant to the terms of the Mortgage Sale Agreement for cash consideration or an Interest in the Partnership pursuant to the terms of the Mortgage Sale Agreement. 

 

	
    

	
 (2) 

	
 Each sale of Loans and their Related Security by the Limited Partner to the Partnership shall, to the extent not paid for fully in cash, constitute a Capital Contribution in Kind equal to (a) the aggregate of the fair market value of those Loans as at the relevant Transfer Date, minus (b) the cash consideration, if any, paid by or on behalf of the Partnership for the Loans and their Related Security on the relevant Transfer Date. 

 

    

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 Section 3.6             Capital Distributions. 

 

	
    

	
 (1) 

	
 The Managing GP may make Capital Distributions to the Partners, from time to time, as it may determine in its sole discretion, in accordance with and provided that such Capital Distributions are permitted under, Article 6 (Priorities of Payments) and if applicable, under the terms of the Security Agreement. 

 

	
    

	
 (2) 

	
 Without limiting the foregoing, Capital Distributions made prior to a Covered Bond Guarantee Activation Event may only be made if the Partnership is at the time of such Capital Distribution meets, and following such Capital Distribution will meet the Asset Coverage Test. 

 

 Section 3.7             Capital Contribution Balance. 

 

	
    

	
 (1) 

	
 The Managing GP (or the Cash Manager on its behalf), determine the Capital Contribution Balance of each of the Partners (which on the date hereof, in respect of each Partner, shall be equal to the initial Cash Capital Contribution set out next to such Partner’s name in Section 3.2 above) (i) on or before the Business Day that is at least two days prior to each Guarantor LP Payment Date (such amouts to be determined as of the immediately preceding Calculation Date); (ii) at the date that the Partnership is wound up, and (iii) on such other date as the Limited Partner may reasonably request. 

 

	
    

	
 (2) 

	
 Following the date hereof, the Capital Contribution Balance of each Partner on any relevant date shall be equal to the sum of the last most recently determined Capital Contribution Balance of the Partner, plus (i) the amount of any Capital Contribution made by the Partner in the period from the last date on which the Capital Contribution Balance of the Limited Partner was calculated to the date of the current calculation (the “Calculation Period”); minus (ii) the amount of any Capital Distribution to be paid to the Limited Partner on the next following Guarantor LP Payment Date (provided such amount is payable in accordance with Article 6 (Priorities of Payment)). 

 

 Section 3.8             No Interest Payable on Accounts. 

 

 No Partner has the right to receive interest on any credit balance in its Capital Contribution Balance, and no Partner is liable to pay interest to the Partnership on any deficit in its Capital Contribution Balance. 

 

 Section 3.9             Deficit in Accounts. 

 

 The interest of a Partner in the Partnership will not terminate by reason of a negative or zero Capital Contribution Balance of the relevant Partner. 

 

    

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 ARTICLE 4 

 PROFITS, LOSSES AND DISTRIBUTIONS 

 

 Section 4.1             Allocation of Profits and Losses of the Partnership. 

 

	
    

	
 (1) 

	
 Subject to Section (2) and (3) below, the Net Income and Net Loss for each Fiscal Year, including for income tax purposes, shall be allocated pro rata to the Partners in respect of their respective Capital Contribution Balances. 

 

	
    

	
 (2) 

	
 Prior to an Issuer Event of Default or other circumstance in which the Liquidation GP shall assume the duties of the Managing General Partner hereunder, the Liquidation GP’s share of the Net Income shall be limited to the lesser of its pro rata share and $30,000 annually, payable in accordance with Article 6 (Priorities of Payment) and any amount in excess thereof shall be allocated to the Limited Partner and following any such event the Liquidation GP (for so long as it assumes the duties and responsibilities of the Managing GP) shall be entitled to its pro rata share of the Net Income. 

 

	
    

	
 (3) 

	
 The Managing GP shall make distributions of income to the Partners in a manner consistent with this Section 4.1 and in accordance with Article 6 (Priorities of Payment) and applicable law, provided that at the time of any such distribution, the Partnership is, and following such distribution, will remain in compliance with the Asset Coverage Test or Amortization Test, as applicable. 

 

 Section 4.2             Restriction on Withdrawals and Receipts. 

 

	
    

	
 (1) 

	
 No Partner will have any right to withdraw any amount or receive any distribution from the Partnership except in accordance with Article 6 (Priorities of Payments) and applicable law. 

 

	
    

	
 (2) 

	
 Each of the Partners agrees that, notwithstanding any other provision contained herein or in any other Transaction Document: 

 

	
    

	
 (a) 

	
 it will not demand or receive payment of, or any distribution in respect of or on account of, any amounts payable by the Partnership (or the Cash Manager on its behalf) or the Bond Trustee, as applicable, to such Partner under the Transaction Documents, in cash or in kind, and will not apply any money or assets in discharge of any such amounts payable to it (whether by set-off or by any other method), unless all amounts then due and payable by the Partnership to all other creditors ranking higher in the relevant Priorities of Payments have been paid in full; 

 

    

 -15- 

    

 

	
    

	
 (b) 

	
 without prejudice to the foregoing, whether in the liquidation of the Partnership or any other party to the Transaction Documents or otherwise, if any payment or distribution (or the proceeds of any enforcement of any security) is received by a Partner in respect of any amount payable by the Partnership (or the Cash Manager on its behalf) or the Bond Trustee, as applicable, to that Partner under the relevant Transaction Document at a time when, by virtue of the provisions of Article 6 (Priorities of Payments), no payment or distribution should have been made, the amount so received shall be held by such Partner in trust for the payor of such amount and shall be paid over to such payor forthwith following receipt thereof (whereupon the relevant payment or distribution shall be deemed not to have been made or received); and 

 

	
    

	
 (c) 

	
 it shall not claim, rank, prove or vote as creditor of the Partnership or its estate in competition with any prior ranking creditors in the relevant Priorities of Payments in Article 6 (Priorities of Payments), or claim a right of set-off until all amounts then due and payable to creditors who rank higher in the relevant Priorities of Payments in Article 6 (Priorities of Payments) have been paid in full. 

 

	
    

	
 (3) 

	
 Without limiting this Section 4.2, each Limited Partner for so long as such person is a Limited Partner, hereby waives any right it may have to receive or hold any property of the Guarantor LP as collateral security or to receive from the Managing GP, the Liquidation GP, in such capacity, or the Guarantor LP, any payment, conveyance, or release from liability, if at such time the assets of the Guarantor LP are not sufficient to discharge partnership liabilities of the Guarantor LP to persons who are not general or limited partners of the Guarantor LP, in each case solely to the extent required by Section 12 of the LP Act. 

 

 Section 4.3             Set-Off. 

 

 Subject to Section 4.2, the Partnership may set off any of its liabilities or obligations to any Partner against any liabilities or obligations of such Partner to the Partnership under this Agreement or any other agreement, subject to the terms of any relevant agreements between the Partnership and such Partner. 

 

 Section 4.4             Compliance with Agreements. 

 

 Notwithstanding anything in this Agreement, no Partner will have the right to enforce any distribution that is contrary to any agreements binding on the Partnership or any applicable law. 

 

 ARTICLE 5 

 ASSET COVERAGE TEST AND AMORTIZATION TEST 

 

 Section 5.1             Asset Coverage Test. 

 

	
    

	
 (1) 

	
 For so long as the Covered Bonds remain outstanding, the Partnership and the Partners (other than the Liquidation GP) shall use all reasonable efforts to ensure that on each Calculation Date the Partnership is in compliance with the Asset Coverage Test as set out in Schedule 2. 

 

    

 -16- 

    

 

	
    

	
 (2) 

	
 If it is determined that the Partnership does not meet the Asset Coverage Test as of any Calculation Date, the Managing GP (or the Cash Manager on its behalf) shall immediately (and in any event no later than the Business Day that is at least two days prior to the next Guarantor LP Payment Date) notify in writing the Partnership, the Partners and the Bond Trustee thereof. 

 

	
    

	
 (3) 

	
 If the Asset Coverage Test is not met as of the next Calculation Date following delivery of a notice pursuant to Section 5.1(2), the Managing GP (or the Cash Manager on its behalf) shall serve an Asset Coverage Test Breach Notice on the Partnership and deliver a copy of such Asset Coverage Test Breach Notice to each of the Partners and the Bond Trustee on the Business Day that is at least two days prior to the Guarantor LP Payment Date after such Calculation Date. 

 

	
    

	
 (4) 

	
 If the Asset Coverage Test is met as of the next Calculation Date following service of an Asset Coverage Test Breach Notice, the Managing GP (or the Cash Manager on its behalf) shall revoke such Asset Coverage Test Breach Notice by serving notice on the Partnership that the Asset Coverage Test has been met and delivering a copy of such notice to each of the Partners and the Bond Trustee on the Business Day that is at least two days prior to the Guarantor LP Payment Date after such Calculation Date. 

 

 Section 5.2             Asset Coverage Test Breach Notice. 

 

 If at any time, the Managing GP or the Limited Partner receives an Asset Coverage Test Breach Notice, the Managing GP shall use all reasonable efforts to ensure that the Asset Coverage Test will be met as of the next following Calculation Date and the Limited Partner shall use all reasonable efforts to, as the Limited Partner may determine in its sole discretion, (i) make a Cash Capital Contribution; (ii) make a Capital Contribution in Kind to the Partnership; (iii) sell New Loans and their Related Security to the Partnership in an amount or amounts sufficient to ensure the Partnership is or will, prior to the next Calculation Date following delivery of such Asset Coverage Test Breach Notice, be in compliance with the Asset Coverage Test. 

 

 Section 5.3             Amortization Test. 

 

	
    

	
 (1) 

	
 Following service of a Notice to Pay on the Partnership, for as long as there are Covered Bonds outstanding, the Managing GP shall use all reasonable efforts to ensure that on each Calculation Date that the Partnership is in compliance with the Amortization Test as set out in Schedule 3. 

 

	
    

	
 (2) 

	
 If as of any Calculation Date following service of a Notice to Pay on the Partnership, the Partnership is not in compliance with the Amortization Test, the Managing GP (or the Cash Manager on its behalf) shall immediately (and in any event no later than the Business Day that is at least two days prior to the Guarantor LP Payment Date after such Calculation Date) notify the Partners and the Bond Trustee thereof. 

 

    

 -17- 

    

 

 ARTICLE 6 

 PRIORITIES OF PAYMENTS 

 Section 6.1             Pre-Acceleration Priorities of Payment. 

 

	
    

	
 (1) 

	
 Subject to Section 6.1(2), at any time no Asset Coverage Test Breach Notice is outstanding and no Covered Bond Guarantee Activation Event has occurred: 

 

	
    

	
 (a) 

	
 the Managing GP (or the Cash Manager on its behalf) shall on or before the Business Day that is at least two days prior to any Guarantor LP Payment Date calculate the following amounts as of the immediately preceding Calculation Date: 

 

	
    

	
 (i) 

	
 the amount of Available Revenue Receipts available for distribution on the immediately following Guarantor LP Payment Date; 

 

	
    

	
 (ii) 

	
 the Reserve Fund Required Amount if applicable in accordance with Section 6.1(2); and 

 

	
    

	
 (iii) 

	
 the amount of Available Principal Receipts available for distribution on the immediately following Guarantor LP Payment Date; 

 

	
    

	
 (b) 

	
 on each Guarantor LP Payment Date, the Managing GP or the Cash Manager on its behalf will transfer Available Revenue Receipts and Available Principal Receipts from the Revenue Ledger to the Payment Ledger, and use (or direct the Cash Manager to use) Available Revenue Receipts and Available Principal Receipts held by the Cash Manager for and on behalf of the Guarantor LP and, as necessary, transfer Available Revenue Receipts and Available Principal Receipts from the GIC Account to the Transaction Account (to the extent maintained), in an amount equal to the lower of (a) the amount required to make the payments set out in Schedule 4 (the “Pre-Acceleration Revenue Priority of Payments”) in the case of Available Revenue Receipts and Schedule 5 (the “Pre-Acceleration Principal Priority of Payments”) in the case of Available Principal Receipts, and (b) the aggregate amount of Available Revenue Receipts and Available Principal Receipts standing to the credit of the GIC Account; and 

 

	
    

	
 (c) 

	
 on each Guarantor LP Payment Date (except for the amounts due to third parties by the Partnership under Section (a) of Schedule 4 and any Third Party Amounts, which in each case shall be paid when due), the Managing GP (or the Cash Manager on its behalf) will apply: 

 

 

    

 -18- 

    

 

	
    

	
 (i) 

	
 Available Revenue Receipts to make the payments and provisions set forth in Schedule 4 in the order of priority set forth in Schedule 4 (in each case only if and to the extent that payments or provisions of a higher priority have been made in full); and 

 

	
    

	
 (ii) 

	
 Available Principal Receipts to make the payments, provisions or credits set forth in Schedule 5 in the order of priority set forth in Schedule 5 (in each case only if and to the extent that payments or provisions of a higher priority have been made in full). 

 

	
    

	
 (2) 

	
 If, at any time prior to the occurrence of an Issuer Event of Default, the ratings of the Issuer fall below the Reserve Fund Required Amount Ratings, the Guarantor LP (or the Cash Manger on its behalf): 

 

	
    

	
 (a) 

	
 shall establish the Reserve Fund on the GIC Account in the books of account of the Partnership maintained pursuant to Section 9.3; and 

 

	
    

	
 (b) 

	
 provided that the Guarantor LP shall have paid all of its obligations in respect of items ranking higher than the Reserve Ledger in the Pre-Acceleration Revenue Priority of Payments on each subsequent Guarantor LP Payment Date, shall credit or cause to be credited to the Reserve Fund funds up to an amount equal to the Reserve Fund Required Amount with Available Revenue Receipts. 

 

	
    

	
 (3) 

	
 At any time that no Asset Coverage Test Breach Notice is outstanding and a Covered Bond Guarantee Activation Event has not occurred, any Cash Capital Contributions made by the Limited Partner from time to time (excluding its initial Cash Capital Contribution) shall be distributed, if permitted in accordance with Section 3.6, to the Limited Partner as a Capital Distribution on each Guarantor LP Payment Date unless otherwise agreed to by the Limited Partner prior to such Guarantor LP Payment Date. 

 

 Section 6.2             Priority of Payments at any time an Asset Coverage Test Breach Notice is outstanding but no Covered Bond Guarantee Activation Event has occurred. 

 

 At any time an Asset Coverage Test Breach Notice is outstanding but no Covered Bond Guarantee Activation Event has occurred, the Partnership shall continue to comply with Section 6.1, except that, while any Covered Bonds remain outstanding, no moneys will be applied under paragraphs (b), (e), (i) (to the extent only that such amounts are payable to a Partner), (j) or (k) of Schedule 4 or paragraphs (a), (b), or (d) or (e) of Schedule 5 and for greater certainty, Cash Capital Contributions made by the Limited Partner shall not be distributed to the Limited Partner. 

 

    

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 Section 6.3             Termination Payments, Indemnities and Tax Credits received in respect of the Swap Agreements, premiums received in respect of replacement Swap Agreements. 

 

	
    

	
 (1) 

	
 Notwithstanding anything else in this Article 6: 

 

	
    

	
 (a) 

	
 if the Partnership receives any termination payment from a Swap Provider in respect of a Swap Agreement, such termination payment will first be used, to the extent necessary (prior to service of a Guarantor LP Acceleration Notice) to pay a replacement Swap Provider to enter into a replacement Swap Agreement with the Partnership, unless a replacement Swap Agreement has already been entered into on behalf of the Partnership.  If the Partnership receives any premium from a replacement Swap Provider in respect of a replacement Swap Agreement, such premium will first be used to make any termination payment due and payable by the Partnership with respect to the previous Swap Agreement, unless such termination payment has already been made on behalf of the Partnership; 

 

	
    

	
 (b) 

	
 if the Partnership is required under the terms of any relevant Swap Agreement to make a payment to a Swap Provider in consequence of the receipt by a Partner of a credit in respect of any taxation (a “Relevant Tax Payment”), then such Partner shall pay to the Partnership an amount equal to the Relevant Tax Payment on the date on which such Relevant Tax Payment is due to be made by the Partnership under the terms of such Swap Agreement; 

 

 

	
    

	
 (c) 

	
 if the Swap Provider breaches certain tax representations in the relevant Swap Agreement and a Partner of the Partnership suffers loss, the Partnership may receive payment of indemnity amounts from the Swap Provider on the affected Partner's behalf.  The Partnership shall account to the relevant Partner for such amounts and shall pay amounts upon receipt to the relevant Partner. For the avoidance of doubt, amounts received by the Partnership, in accordance with this Section 6.3(1)(c) shall not be funds of the Partnership and will not be construed to be amounts received in respect of Available Revenue Receipts or Available Principal Receipts; and 

 

	
    

	
 (d) 

	
 any amounts received in the circumstances described in this Section 6.3 other than pursuant to Section 6.3(1)(c) which are not applied to pay a replacement Swap Provider to enter into a replacement Swap Agreement will be credited to the Revenue Ledger and applied as Available Revenue Receipts in accordance with this Article 6 on the next succeeding Guarantor LP Payment Date. 

 

    

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 Section 6.4             Guarantee Priority of Payments. 

 

	
    

	
 (1) 

	
 At any time after the service of a Notice to Pay on the Partnership, but prior to service of a Guarantor LP Acceleration Notice: 

 

	
    

	
 (a) 

	
 on each Guarantor LP Payment Date, the Managing GP (or the Cash Manager on its behalf) will transfer Available Revenue Receipts and Available Principal Receipts from the Revenue Ledger, the Reserve Ledger, the Principal Ledger or the Capital Account Ledger, as the case may be, to the Payment Ledger, in an amount equal to the lower of (a) the amount required to make the payments set out in Schedule 6 (the “Guarantee Priority of Payments”); and (b) the amount of all Available Revenue Receipts and Available Principal Receipts standing to the credit of such Ledgers; 

 

	
    

	
 (b) 

	
 the Managing GP (or the Cash Manager on its behalf) will create and maintain ledgers for each Series of Covered Bonds and record amounts allocated to such Series of Covered Bonds in accordance with paragraph (f) of Schedule 6, and such amounts, once allocated, will only be available to pay amounts due under the obligations of the Partnership in respect of the Covered Bond Guarantee and amounts due in respect of the relevant Series of Covered Bonds under the Covered Bond Swap Agreement on the scheduled repayment dates thereof; and 

 

	
    

	
 (c) 

	
 on each Guarantor LP Payment Date after the service of a Notice to Pay on the Partnership (but prior to the occurrence of a Guarantor LP Event of Default), the Partnership (or the Cash Manager on its behalf) will apply Available Revenue Receipts and Available Principal Receipts to make the payments, provisions or credits set forth in the Guarantee Priority of Payments in the order of priority set forth therein (in each case only if and to the extent that payments or provisions of a higher priority have been made in full). 

 

	
    

	
 (2) 

	
 At any time after the service of a Guarantor LP Acceleration Notice but prior to the Covered Bonds having been repaid, the terms of the Security Agreement provide that all moneys received or recovered by the Bond Trustee (or a Receiver appointed on its behalf) (excluding all amounts due or to become due in respect of any Third Party Amounts) will be applied following the enforcement of the Security in accordance with the Post-Enforcement Priority of Payments set out in the Security Agreement. 

 

    

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 Section 6.5             Priority of Payments when Covered Bonds Repaid. 

 

 From the date when either (a) the Covered Bonds have been fully repaid and the Security constituted by the Security Agreement has been released by the Bond Trustee; or (b) the Bond Trustee is satisfied that the Partnership has Authorized Investments in a principal amount, and/or cash standing to the credit of the GIC Account, alone or together equal to the Required Redemption Amount in respect of each Series of Covered Bonds outstanding, all remaining amounts standing to the credit of the Guarantor LP Accounts (excluding all amounts required to repay higher ranking amounts in the relevant Priority of Payment pursuant to this Article 6) shall be allocated and paid by the Managing GP (or the Cash Manager on its behalf) in accordance with Schedule 8. 

 

 

 ARTICLE 7 

 SALE OF SELECTED LOANS 

 

 Section 7.1             Sale of Selected Loans. 

 

	
    

	
 (1) 

	
 Sales of Loans and their Related Security shall at all times be subject to the rights of pre-emption enjoyed by the Seller pursuant to the terms of the Mortgage Sale Agreement. 

 

	
    

	
 (2) 

	
 At any time that no Asset Coverage Test Breach Notice is outstanding and no Covered Bond Guarantee Activation Event has occurred, the Partnership may sell Loans and their Related Security provided it is in compliance with the Asset Coverage Test and will, following such sale, remain in compliance with the Asset Coverage Test applicable and for greater certainty, the proceeds from such sale may be held by the Cash Manager on behalf of the Partnership prior to a downgrade in the ratings of the Cash Manager below the Cash Manager Deposit Ratings and following such a downgrade deposited in the GIC Account. 

 

	
    

	
 (3) 

	
 At any time an Asset Coverage Test Breach Notice is outstanding or following the service of a Notice to Pay, but prior to the service of a Guarantor LP Acceleration Notice, the Partnership shall sell Selected Loans in the Covered Bond Portfolio and their Related Security in accordance with Schedule 8, subject to the right of pre-emption enjoyed by the Seller pursuant to the terms of the Mortgage Sale Agreement or any Cash Capital Contribution made by the Limited Partner, made in accordance with this Agreement. 

 

	
    

	
 (4) 

	
 The Partnership will through a tender process appoint a portfolio manager of recognized standing on a basis intended to incentivise the portfolio manager to achieve the best price for the sale of the Selected Loans (if such terms are commercially available in the market) to advise it in relation to the sale of the Selected Loans to Purchasers (except where the Sellers are buying the Selected Loans in accordance with their right of pre-emption in the Mortgage Sale Agreement). The terms of the agreement giving effect to the appointment in accordance with such tender shall be approved by the Bond Trustee. 

 

	
    

	
 (5) 

	
 Any sale of Selected Loans and their Related Security will not include any representations or warranties from the Partnership or the Seller in respect of such Loans and their Related Security unless expressly agreed by the Bond Trustee and unless otherwise agreed with the Seller. 

 

    

 -22- 

    

 

	
    

	
 (6) 

	
 The terms of any sale and purchase agreement with respect to the sale of Selected Loans (which shall give effect to the recommendations of the portfolio manager) will be subject to the prior written approval of the Bond Trustee. The Bond Trustee will not be required to release the Selected Loans from the Security unless the conditions relating to the release of the Security as set out in the Security Agreement are satisfied. 

 

	
    

	
 (7) 

	
 The proceeds from any sale of Selected Loans and their Related Security shall be credited to the GIC Account to be applied in accordance with Article 6 (Priorities of Payment). 

 

 

 ARTICLE 8 

 MANAGEMENT OF THE PARTNERSHIP 

 

 Section 8.1             General Authority and Obligations of the Managing GP and the Liquidation GP. 

 

	
    

	
 (1) 

	
 Subject to Section 8.3, the Managing GP (i) has unlimited liability for the debts, liabilities and obligations of the Partnership, (ii) except as expressly provided in this Agreement, is authorized and obliged to manage, control, administer and operate the business and affairs of the Partnership and to make all decisions regarding the business of the Partnership and to represent the Partnership, and (iii) has the full right, power and authority to do any act, take any proceeding, make any decision and execute and deliver any instrument, deed, agreement or document necessary for or incidental to carrying out the objects, purposes and business of the Partnership for and on behalf of the Partnership. In so doing, the Managing GP has all of the rights and powers of a general partner as provided in the LP Act and as otherwise provided by law and any action taken by the Managing GP will constitute the act of and shall serve to bind the Partnership.  The power of the Managing GP to represent the Partnership in dealings with third parties is unrestricted insofar as third parties are concerned and no person dealing with the Partnership will be required to inquire into the authority of the Managing GP to take any act or proceeding, to make any decision or to execute and deliver any instrument, deed, agreement or document for or on behalf of or in the name of the Partnership. 

 

	
    

	
 (2) 

	
 Subject to Section 8.3, the Liquidation GP (i) has unlimited liability for the debts, liabilities and obligations of the Partnership, (ii) following a Managing GP Default, is authorized and obliged to manage, control, administer and operate the business and affairs of the Partnership and to make decisions regarding the business of the Partnership and to represent the Partnership, and (iii) following a Managing GP Default, has the full right, power and authority to do any act, take any proceeding, make any decision and execute and deliver any instrument, deed, agreement or document necessary for or incidental to carrying out the objects, purposes and business of the Partnership for and on behalf of the Partnership. In so doing, the Liquidation GP has all of the rights and powers of a general partner as provided in the LP Act and as otherwise provided by law and any action taken by the Liquidation GP will, subject to the provisions of this Agreement, constitute the act of and shall serve to bind the Partnership.  The power of the Liquidation GP to represent the Partnership in dealings with third parties is unrestricted insofar as third parties are concerned and no person dealing with the Partnership will be required to inquire into the authority of the Liquidation GP to take any act or proceeding, to make any decision or to execute and deliver any instrument, deed, agreement or document for or on behalf of or in the name of the Partnership. 

 

    

 -23- 

    

 

 Section 8.2             General Powers of the Managing GP and the Liquidation GP. 

 

	
    

	
 (1) 

	
 Subject to Section 8.3, and without limiting the generality of Section 8.1, the Managing GP has full power and authority for and on behalf of and in the name of the Partnership: 

 

	
    

	
 (a) 

	
 to negotiate, enter into and to perform any agreement in connection with the establishment, operation, conduct or expansion of the business of the Partnership; 

 

	
    

	
 (b) 

	
 to manage and control all of the activities of the Partnership and take all measures necessary or appropriate for the business of the Partnership or ancillary thereto; 

 

	
    

	
 (c) 

	
 to maintain the records and accounts of the Partnership including thouse required to be maintained pursuant to the terms of this Agreement and applicable law and provide reports to the Partners; 

 

	
    

	
 (d) 

	
 acquire any real or personal property required or desirable for the business of the Partnership and to dispose of any property of the Partnership; 

 

	
    

	
 (e) 

	
 to borrow money from time to time without limit as to the amount, cost or terms of payment thereof, to draw, make, execute and issue promissory notes, evidences of notes, evidences of indebtedness and other negotiable or non-negotiable instruments and to secure the payment thereof by mortgage, charge, debenture, hypothecation, pledge or by the creation of any other appropriate security interest; 

 

	
    

	
 (f) 

	
 to cause the Partnership to provide guarantees, indemnities and other forms of assurance; 

 

	
    

	
 (g) 

	
 to cause the Partnership to provide security for any of its obligations; 

 

	
    

	
 (h) 

	
 to cause the Partnership to acquire or maintain insurance coverage of any type; 

 

    

 -24- 

    

 

	
    

	
 (i) 

	
 to employ, retain, engage or dismiss all Persons necessary for the conduct of the business of the Partnership; 

 

	
    

	
 (j) 

	
 to delegate any of its duties to such other Persons as it sees fit; 

 

	
    

	
 (k) 

	
 to retain such legal counsel, experts, advisors or consultants as the Managing GP considers appropriate and to rely upon the advice of such persons; 

 

	
    

	
 (l) 

	
 to open and operate any bank account; 

 

	
    

	
 (m) 

	
 to establish any required place of business of the Partnership; 

 

	
    

	
 (n) 

	
 to pay all costs and expenses of the Partnership; 

 

	
    

	
 (o) 

	
 to commence or defend any action or proceeding by, against or in connection with the Partnership; 

 

	
    

	
 (p) 

	
 to collect, sue for and receive all sums of money or other property or items that are believed due to the Partnership; 

 

	
    

	
 (q) 

	
 to file returns required by any governmental or like authority; 

 

	
    

	
 (r) 

	
 to execute and file on behalf of the Partnership any elections that are referred to in the Income Tax Act or other applicable tax legislation as are in its reasonable opinion appropriate in the circumstances; 

 

	
    

	
 (s) 

	
 to invest funds of the Partnership not immediately required for the business of the Partnership; 

 

	
    

	
 (t) 

	
 to enter into hedge contracts or similar arrangements to permit the Partnership to mitigate or eliminate the Partnership’s exposure to interest rate fluctuations or foreign exchange or other risks associated with the business; 

 

	
    

	
 (u) 

	
 to make distributions; and 

 

	
    

	
 (v) 

	
 to do anything that is provided for in this Agreement or that is in furtherance of or is incidental to or is necessary or desirable in respect of the business of the Partnership, including, without limitation, to do all such acts and things and execute all such agreements and other instruments as are necessary to give effect to the transactions described or contemplated by the Prospectus whether or not specifically mentioned in this Agreement. 

 

	
    

	
 (2) 

	
 The Managing GP may call a general meeting of the Partners at any time and place as it deems appropriate in its absolute discretion for the purpose of considering any matter set out in the notice of meeting and will be required to convene a meeting on receipt of a request in writing from the Limited Partner or the Liquidation GP. 

 

    

 -25- 

    

 

	
    

	
 (3) 

	
 Subject to Section 8.3, and without limiting the generality of Section 8.1, the Liquidation GP shall, following a Managing GP Default, have full power and authority for and on behalf of and in the name of the Partnership to do any act that prior to the Managing GP Default was within the power and authority of the Managing GP. 

 

 Section 8.3             Limitation on Authority of the Managing GP and the Liquidation GP. 

 

	
    

	
 (1) 

	
 Notwithstanding the general authority and powers granted to the Managing GP or the Liquidation GP hereunder, unless contemplated in or required to comply with any of the Transaction Documents to which the Guarantor LP is a party, the Managing GP and the Liquidation GP will not, without the consent of the Limited Partner, and while there are any Covered Bonds outstanding, the Bond Trustee (and in the case of Section 8.3(1)(i) below the Liquidation GP) and will not cause the Partnership to: 

 

	
    

	
 (a) 

	
 have an interest in any bank account, other than as set out in the Transaction Documents; 

 

	
    

	
 (b) 

	
 have any employees or premises or subsidiaries; 

 

	
    

	
 (c) 

	
 acquire any material assets (including Authorized Investments and Substitute Investments) other than pursuant to or in accordance with the terms of the Mortgage Sale Agreement, this Agreement and the other Transaction Documents to which it is a party; 

 

	
    

	
 (d) 

	
 transfer, sell, lend, part with or otherwise dispose of, or deal with, or grant any option or present or future right to acquire any of its assets or undertakings or any interest, estate, right, title or benefit therein or thereto or agree or attempt or purport to do so except pursuant to and in accordance with the terms of the Security Agreement or other Transaction Documents to which it is a party; 

 

	
    

	
 (e) 

	
 enter into any contracts, agreements or other undertakings other than the Transaction Documents; 

 

	
    

	
 (f) 

	
 incur any indebtedness in respect of borrowed money whatsoever or give any guarantee or indemnity in respect of any such indebtedness other than pursuant to the Transaction Documents; 

 

	
    

	
 (g) 

	 create or permit to subsist any mortgage, security, pledge, lien, charge, hypothec or other security interest whatsoever (unless arising by operation of law), upon the whole or any part of its assets or its undertakings, present or future other than as created or permitted in the Security Agreement or the other Transaction Documents to which it is a party; 

 

    

 -26- 

    

 

	
    

	
 (h) 

	
 change the name or business of the Partnership or do any act in contravention of, or make any amendment to this Agreement; 

 

	
    

	
 (i) 

	
 do any act which makes it impossible to carry on the business of the Partnership, including dissolving, terminating, winding-up or otherwise discontinuing the Partnership; 

 

	
    

	
 (j) 

	
 compromise, compound or release any debt due to it; 

 

	
    

	
 (k) 

	
 commence, defend, settle or compromise any litigation or other claims relating to it or any of its assets; 

 

	
    

	
 (l) 

	
 permit a person to become a general or limited partner (except in accordance with the terms of this Agreement); or 

 

	
    

	
 (m) 

	
 consolidate or merge with any other person or convey or transfer its properties or assets substantially as an entirety to any other person. 

 

	
    

	
 (2) 

	
 Notwithstanding the general authority and powers granted to the Managing GP and the Liquidation GP hereunder, all material transactions and agreements involving the Partnership (other than the Transaction Documents) must be approved by the Managing GP’s board of directors and following a Managing GP Default the Liquidation GP’s board of directors. 

 

 Section 8.4             Meetings of the Partners. 

 

	
    

	
 (1) 

	
 The Partnership is not required to call or hold annual general meetings of the Partners. 

 

	
    

	
 (2) 

	
 The Managing GP shall, upon a request from the Limited Partner, call a meeting of the Partners. 

 

	
    

	
 (3) 

	
 The Managing GP shall deliver notice of the time, place and business to be conducted at any meeting of the Partners at least 15 Business Days' prior to any meeting of the Partners. 

 

 Section 8.5             Title to Property. 

 

 The Managing GP or the Liquidation GP (if directed by the Managing GP or following a Managing GP Default) may hold legal title to any or all property of the Partnership in its name for the benefit of the Partnership. 

 

    

 -27- 

    

 

 Section 8.6             Discharge of Duties of the Managing GP and the Liquidation GP. 

 

 Each of the Managing GP and the Liquidation GP agrees to exercise its powers and discharge its duties under this Agreement honestly, in good faith and in the best interests of the Partnership and in connection therewith shall exercise the standard and degree of care, diligence and skill that a reasonably prudent Person would exercise in comparable circumstances. 

 

 Section 8.7             Reimbursement. 

 

 The Managing GP and the Liquidation GP will, subject to the terms of Article 6 (Priorities of Payment), each be entitled to be reimbursed by the Partnership for all out-of-pocket expenses incurred in the performance of its duties hereunder. 

 

 Section 8.8             Commingling of Funds. 

 

 The funds and assets of the Partnership shall not (except in accordance with the terms of this Agreement and the Transaction Documents) be commingled with the funds or assets of the Managing GP or the Liquidation GP or of any other Persons. 

 

 Section 8.9             Execution of Documents. 

 

 Any and all powers of the Managing GP or of the Liquidation GP may be exercised by the execution and delivery by such person or an agent, director, officer or employee of such person designated by such person for and on behalf of and in the name of the Partnership, and under seal or otherwise, of agreements, instruments, deeds or other documents in such forms as the Managing GP or Liquidation GP, as the case may be, or their respective agent, director, officer or employee designated for such purpose may deem sufficient. 

 

 Section 8.10           Delegation. 

 

 Each of the Managing GP and the Liquidation GP may contract with any other Person to carry out any of their respective duties and may delegate to such person any power and authority of such person hereunder, but no such contract or delegation will relieve such person of any of its obligations hereunder, including its obligations in connection with the control of the business, affairs and undertaking of the Partnership. 

 

 Section 8.11           Insurance. 

 

 The Managing GP may, on behalf of the Partnership, purchase and maintain, or cause to be purchased and maintained, for the benefit of the Partnership and the operation of the business thereof, property, casualty and other insurance of such types and coverages as the Managing GP determines to be appropriate in the circumstances. 

 

    

 -28- 

    

 

 Section 8.12           Ostensible Authority. 

 

 Each of the Managing GP and the Liquidation GP will, where it deems necessary and practicable, insert, and cause agents of the Partnership to insert, the following clause in any contracts or agreements to which the Partnership is a party or by which it is bound: 

 

 “RBC Covered Bond Guarantor Limited Partnership is a limited partnership formed under the Limited Partnerships Act (Ontario), a limited partner of which is, except as expressly required by law, only liable for any of its liabilities or any of its losses to the extent of the amount that the limited partner has contributed or agreed to contribute to its capital.” 

 

 Section 8.13           Decisions by Partners following the appointment of a liquidator or receiver to any Partner. 

 

 Without limiting anything else contained herein, at any time a liquidator or receiver is appointed in respect of a Partner, any decisions of the Partnership that are reserved to that Partner or that requires the unanimous consent of the Partners will be made by the Partner(s) not then in liquidation or receivership, as the case may be, and such Partner shall be deemed to have consented to such decision. 

 

 

 ARTICLE 9 

 REGISTERED OFFICE, BOOKS AND RECORDS AND FINANCIAL INFORMATION 

 

 Section 9.1             Registered Office. 

 

 The Managing GP will maintain a registered office at Royal Bank Plaza, South Tower, 9th Floor, 200 Bay Street, Toronto, Ontario, Canada M5J 2J5 and/or at such other place or places in Canada as the Managing GP may from time to time determine, and keep there a copy of this Agreement and any amendments hereto and copies of any other documents required to be so kept pursuant to section 33 of the LP Act or any other laws of similar application in any other jurisdiction in which the Partnership carries on business; 

 

 Section 9.2             Records. 

 

 The Managing GP will: 

 

	
    

	
 (a) 

	
 maintain a record (the “Record”) and record therein the full names and addresses of the Partners; 

 

	
    

	
 (b) 

	
 maintain and update the Record and such other records as may be required by law; and 

 

    

 -29- 

    

 

	
    

	
 (c) 

	
 from time to time make on behalf of the Partnership all filings with any Governmental Authority that are required to be made by the Partnership. 

 

 Section 9.3             Books of Account. 

 

 The Managing GP must keep and maintain, or cause to be kept and maintained, at its principal place of business, separate from any records of the Managing GP or any other Person, full, complete and accurate books of account, and records of the business of the Partnership, including: 

 

	
    

	
 (a) 

	
 the Principal Ledger, which shall record all receipts of Principal Receipts and distribution of Principal Receipts; 

 

	
    

	
 (b) 

	
 the Revenue Ledger, which shall record all receipts of Revenue Receipts and distribution of Revenue Receipts; 

 

	
    

	
 (c) 

	
 the Reserve Ledger, which shall record all Revenue Receipts credited to the Reserve Fund up to the Reserve Fund Required Amount and debits made to the Reserve Fund; and 

 

	
    

	
 (d) 

	
 the Capital Account Ledger for each Partner which shall record the balance of each Partner’s Capital Contributions and distribution of those Capital Contributions. 

 

 Section 9.4             Inspection of Record and Books of Account. 

 

	
    

	
 (1) 

	
 Any Partner may, upon five (5) Business Days’ written notice to the Managing GP, inspect copies of the books and records of the Partnership including, without limitation, the Record, any of the documents to which access is permitted pursuant to section 33(3) of the LP Act and any documents referred to in Section 9.3, at the Limited Partner’s expense during normal business hours. 

 

	
    

	
 (2) 

	
 Without limitation of any audit rights the Limited Partner may have pursuant to any other agreement among the parties hereto, the Limited Partner may, at its expense and upon reasonable written notice to the Managing GP, audit the books of account and records of the business of the Partnership. 

 

 Section 9.5             Appointment of Guarantor LP Auditor. 

 

	
    

	
 (1) 

	
 The Managing GP, with the consent of the Limited Partner, may retain the Guarantor LP Auditor to review and report to the Partners upon the financial statements of the Partnership for, and as at the end of each Financial Year. 

 

	
    

	
 (2) 

	
 Following appointment of the Guarantor LP Auditor may be replaced by the Managing GP, or a new Guarantor LP Auditor may be appointed by the Managing GP in each case with the consent of the Limited Partner. 

 

    

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 Section 9.6             Annual Report and Income Tax Information. 

 

 Within 90 days after the end of each Fiscal Year (or such shorter period of time as may be required by applicable law), the Managing GP will forward or cause to be forwarded to each Partner and to each Person who was shown on the Record as a Partner during such Fiscal Year: 

 

	
    

	
 (a) 

	
 financial statements of the Partnership as at the end of, and for, such Fiscal Year (prepared in accordance with GAAP, consistently applied), together with a report of the Guarantor LP Auditor if applicable; 

 

	
    

	
 (b) 

	
 a report of distributions to Partners in respect of such Fiscal Year; and 

 

	
    

	
 (c) 

	
 such other information as is required to be provided to Partners pursuant to applicable legislation; and 

 

	
    

	
 (d) 

	
 information concerning the amount of Taxable Income or Taxable Loss and credits and charges to capital allocated to such Person and such other information as may be necessary to enable such Person to file applicable Canadian federal and provincial income tax returns with respect to such Person’s income from the Partnership in respect of such Fiscal Year. 

 

 Section 9.7             Additional Financial Information. 

 

 Within forty-five (45) days after the end of each of the first three quarters of each Fiscal Year, the Managing GP will forward or cause to be forwarded to each Partner shown on the Record as a Partner at the end of each such quarter the unaudited financial statements of the Partnership for such quarter. 

 

 Section 9.8             Investing in Substitute Assets and Authorized Investments. 

 

	
    

	
 (1) 

	
 At any time that no Asset Coverage Test Breach Notice is outstanding and prior to a Notice to Pay having been served on the Partnership, the Partnership may invest in and hold Substitute Assets, provided that the aggregate value of the Substitute Assets held by the Partnership does not at any time exceed 10 % of the total assets of the Partnership  and provided that such investments are made in accordance with the terms of the Cash Management Agreement and subject to Article 6 (Priorities of Payments).  For greater certainty, amounts standing to the credit of the Partnerhsip in any Guarantor LP Account and invested in Authorized Investments will not constitute Substitute Assets. 

 

	
    

	
 (2) 

	
 At any time an Asset Coverage Test Breach Notice is outstanding or a Covered Bond Guarantee Activation Event has occurred, the Managing GP must, or must cause the Cash Manager (on behalf of the Partnership) to sell the Substitute Assets held by or on behalf of the Partnership as quickly as reasonably practicable, with proceeds credited to the GIC Account and/or invested in Authorized Investments by the Managing GP (or the Cash Manager on its behalf). 

 

    

 -31- 

    

 

	
    

	
 (3) 

	
 At no time shall there be any limit on the amounts that the Guarantor LP will be entitled to invest in Authorized Investments provided that such investments are made in accordance with the terms of the Cash Management Agreement and subject to Article 6 (Priorities of Payments). 

 

 

 ARTICLE 10 

 NEW LIMITED PARTNERS 

 

 Section 10.1           Transfer. 

 

	
    

	
 (1) 

	
 No change of name or address of a Limited Partner, no Transfer of an interest in the Partnership and no admission of a new Partner will be effective for the purposes of this Agreement until: (a) written notice of the same has been delivered to each of the Partners, the Bond Trustee and the Rating Agencies, (b) each of the Partners and the Bond Trustee pursuant to Section 10.1(e) below has consented thereto (provided that such consent shall not be required for the Limited Partner to Transfer all or a portion of its interest in the Partnership to a Subsidiary, provided such Subsidiary is not a Non-Resident), (c) the transferee has in accordance with the requirements of this Agreement, delivered a form of transfer and power of attorney satisfactory to the Managing GP, acting reasonably, and agreed to accede to and become bound by this Agreement and has delivered such documents and other instruments as the Managing GP may reasonably request; and (d) such change, transfer or addition is duly reflected in the Record.  The names and addresses of the Limited Partner(s) as reflected from time to time in the Record, as from time to time amended, will be conclusive as to such facts for all purposes of the Partnership. 

 

	
    

	
 (2) 

	
 In addition to the requirements set forth in Section 10.1(1), any new Limited Partner (except a Subsidiary of the Limited Partner, provided such Subsidiary is not a Non-Resident) shall while there are Covered Bonds outstanding: 

 

	
    

	
 (a) 

	
 accede to the terms of the Mortgage Sale Agreement (with such subsequent amendments as may be agreed by the parties thereto) or enter into a new mortgage sale agreement with the Partnership and the Bond Trustee, in each case so that it has, in relation to New Loans and their Related Security to be sold by such new Limited Partner, substantially the same rights and obligations as the Limited Partner had in relation to those Loans and their Related Security comprised in the Initial Covered Bond Portfolio under the Mortgage Sale Agreement; 

 

	
    

	
 (b) 

	
 accede to the Dealership Agreement and enter into such other documents as may be required by the Bond Trustee and/or the Partnership to give effect to the addition of such new Limited Partner to the transactions contemplated under the Programme; 

 

    

 -32- 

    

 

	
    

	
 (c) 

	
 ensure that any New Loans and their Related Security sold by such new Limited Partner to the Partnership comply with the Eligibility Criteria set out in the Mortgage Sale Agreement; 

 

	
    

	
 (d) 

	
 procure that either the Servicer services the New Loans and their Related Security sold by the new Limited Partner on the terms set out in the Servicing Agreement (with such subsequent amendments as may be agreed by the parties thereto) or the new Limited Partner (or its nominee) enter into a servicing agreement with the Partnership and the Bond Trustee which sets out the servicing obligations of the new Limited Partner (or its nominee) in relation to the New Loans and their Related Security and which is on terms substantially similar to the terms set out in the Servicing Agreement (the fees, if any, payable to the Servicer or the New Limited Partner (or its nominee) acting as servicer of such New Loans and their Related Security would be determined on the date of the accession of such new Limited Partner to the Programme); and 

 

	
    

	
 (e) 

	
 procure written confirmation from the Bond Trustee that it is satisfied that the accession of such New Limited Partner to the Partnership will not prejudice the Asset Coverage Test and is not materially prejudicial to Covered Bondholders and Rating Agency Confirmation (provided that such confirmations shall not be required for the Limited Partner to Transfer all or a portion of its interest in the Partnership to a Subsidiary, provided such Subsidiary is not a Non-Resident). 

 

	
    

	
 (3) 

	
 Upon receipt of any notice in writing from any Partner complying with the terms of this Agreement and requiring the updating of the Record or any similar document or instrument or other filing under the LP Act or legislation similar to the LP Act in other provinces and territories, the Managing GP shall prepare, file and record such update in the Record or other document or instrument or other filing. 

 

	
    

	
 (4) 

	
 Notwithstanding the above, no Transfer of an interest in the Partnership and no admission of a new Limited Partner shall be effective unless the transferee or the new Limited Partner, as applicable, is an affiliate (as defined in the Bank Act (Canada)) of the Bank. 

 

    

 -33- 

    

 

 ARTICLE 11 

 REMOVAL AND RESIGNATION OF THE MANAGING GENERAL PARTNER AND THE LIQUIDATION GENERAL PARTNER 

 

 Section 11.1           Assignment of Interest of Managing GP. 

 

 Except with the prior approval of all Partners, or as otherwise expressly provided in this Agreement, the Managing GP shall not sell, assign, Transfer or otherwise dispose (including by way of amalgamation, arrangement, merger or consolidation) of its interest in the Partnership. 

 

 Section 11.2           Removal of Managing GP. 

 

	
    

	
 (1) 

	
 Upon the occurrence of any of the following events: 

 

	
    

	
 (i) 

	
 the passing of any resolution of the directors or the shareholder of the Managing GP requiring or approving the bankruptcy, dissolution, liquidation or winding up of the Managing GP; 

 

	
    

	
 (ii) 

	
 the making of any assignment for the benefit of creditors of the Managing GP, or upon the appointment of a receiver of the assets and undertaking of the Managing GP, 

 

	
    

	
 (iii) 

	
 the appointment of a receiver of the assets and undertaking of the Managing GP, or 

 

	
    

	
 (iv) 

	
 the occurrence of a Covered Bond Guarantee Activation Event 

 

 (each a “Managing GP Default Event”), 

 

 the Managing GP shall cease to be the managing general partner of the Partnership. 

 

	
    

	
 (2) 

	
 Forthwith following a Managing GP Default, the Liquidation GP shall be appointed the new managing general partner without the need for consent on the part of any Person and notice of such appointment shall be delivered forthwith to each of the other Partners and the Bond Trustee. 

 

    

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 Section 11.3           Resignation of Managing GP or the Liquidation GP. 

 

 The Managing GP (provided Rating Agency Confirmation is received in respect thereof) or the Liquidation GP may resign as the managing general partner or the liquidation general partner, as the case may be, on not less than 180 days’ written notice to the Partners, and such resignation will become effective upon the earlier of the appointment of a replacement by unanimous consent of the remaining Partners, and while any Covered Bonds are outstanding, the Bond Trustee, and the last day of such 180 day period, following which in the case of the Managing GP resigning, the Liquidation GP shall be deemed to be appointed as the new managing general partner, provided, however, that the Managing GP may not resign if the effect thereof would be to dissolve the Partnership.  In the event the Liquidation GP resigns in accordance with this Section 11.3, the Managing GP shall forthwith use its best reasonable efforts to without delay locate a new liquidation general partner to be appointed by the unanimous consent of the other Partners, and, while there are Covered Bonds outstanding, the Bond Trustee. 

 

 Section 11.4           Transfer to New Managing GP. 

 

 On the admission to the Partnership of the new Managing GP of the Partnership (the “New Managing GP”) and the removal or resignation of the Managing GP, the departing Managing GP (the “Departing Managing GP”) must do all things and take all steps necessary or desirable to transfer to the New Managing GP the administration, management, control and operation of the business of the Partnership and the books, records and accounts of the Partnership to the New Managing GP and must execute and deliver all deeds, certificates, declarations and other documents necessary or desirable to effect such transfer in a timely fashion. 

 

 Section 11.5           Release. 

 

 On the resignation or removal of the Managing GP or of the Liquidation GP, the Partnership will release and hold harmless the resigning or removed Managing GP or Liquidation GP, as the case may be, from all costs, damages, liabilities or expenses suffered or incurred by it as a result of or arising out of events occurring after such resignation or removal, as the case may be, other than as a result of or arising out of any wilful act by the Departing Managing GP or departing Liquidation GP, as the case may be, in relation to the Partnership occurring after such resignation or removal, as the case may be. 

 

 Section 11.6          Transfer of Title to New Managing GP. 

 

 On the removal or withdrawal of the Managing GP and the admission of the New Managing GP, the Departing Managing GP, at the cost of the Partnership, must transfer title to all of the Partnership’s property that is registered in the name of the Departing Managing GP to the name of the New Managing GP.  The Departing Managing GP must execute and deliver all deeds, certificates, declarations and other documents necessary or desirable to effect such transfer in a timely fashion. 

 

 Section 11.7           New Managing GP. 

 

	
    

	
 (1) 

	
 The New Managing GP must not be a “non resident” of Canada within the meaning of the Income Tax Act and must become a party to this Agreement by signing a counterpart hereof. The New Managing GP must agree to be bound by all of the provisions of this Agreement and any other agreement respecting the Partnership to which the Departing Managing GP is bound and must assume the obligations, duties and liabilities of the Managing GP under such agreements as of the date that the New Managing GP becomes the managing general partner. 

 

    

 -35- 

    

 

	
    

	
 (2) 

	
 At any time the Liquidation GP becomes the Managing GP pursuant to the terms of this Agreement, it may appoint a replacement Managing GP for itself, with the consent of the Limited Partner and, while there are Covered Bonds outstanding, the Bond Trustee.  Following the appointment of a replacement Managing GP for the Liquidation GP, the Liquidation GP shall cease to be the Managing GP and resume its rights and obligations hereunder as liquidation general partner, and shall be treated as a Departing Managing GP, provided that it will not be released as the liquidation general partner pursuant to Section 11.5. 

 

 

 ARTICLE 12 

 DISSOLUTION OF PARTNERSHIP 

 

 Section 12.1           Events of Dissolution. 

 

 The Partnership will be dissolved on the earliest to occur of: 

 

	
    

	
 (a) 

	
 the authorization by a resolution of the Limited Partner in writing of such dissolution, provided that the effective time of such resolution is at least two years after the Final Maturity Date for the final Tranche or Series of Covered Bonds then outstanding; and 

 

	
    

	
 (b) 

	
 the date of a dissolution caused by operation of law. 

 

 Section 12.2           Events Not Causing Dissolution. 

 

 Except as expressly provided in Section 12.1(a) above, the Partnership will not be dissolved or terminated by the amendment of this Agreement or the Record or by the resignation, removal, bankruptcy, insolvency, dissolution, liquidation, winding up or receivership of, or the admission, resignation or withdrawal of any Partner. 

 

 Section 12.3           Receiver. 

 

 Subject to the terms of the Security Agreement, upon the occurrence of any of the events set out in Section 12.1, and while there are Covered Bonds outstanding, the Liquidation GP, and when there are no Covered Bonds outstanding, the Managing GP will serve as the receiver of the Partnership, provided that if such person is unable or unwilling to act in such capacity, such Person shall, with the consent of the Limited Partner, and while there are no Covered Bonds outstanding, the Bond Trustee will appoint some other appropriate person or party to act as the receiver of the Partnership. 

 

    

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 Section 12.4           Liquidation of Assets and Distribution of Proceeds of Liquidation. 

 

	
    

	
 (1) 

	
 The receiver appointed pursuant to Section 12.3 will prepare or cause to be prepared a statement of financial position of the Partnership which will be reported upon by the Guarantor LP Auditors, if applicable, and a copy of which will be forwarded to each Person who was shown on the Record as a Partner at the date of dissolution.  Subject to the terms of the Transaction Documents, the receiver will wind up the affairs of the Partnership and all property of the Partnership will be liquidated in an orderly manner and will distribute the net proceeds of the liquidation of the Partnership in accordance with Article 6 (Priorities of Payments).  The receiver will manage and operate the assets and undertaking of the Partnership and will have all powers and authority of the Managing GP under this Agreement.  The receiver will be paid its reasonable fees and disbursements incurred in carrying out its duties as such. 

 

	
    

	
 (2) 

	
 If the Partnership is required to make “in specie” distributions of property in lieu of cash, then the fair market value (as determined by the receiver) thereof shall be used to determine the amounts to be distributed under this Section 11.4, and in the event that “in specie” distributions are required in a case where the Partnership has granted security on any of its assets, then such assets may be distributed directly or indirectly (including via another entity) in such manner as is considered appropriate by the Managing GP and while there are Covered Bonds outstanding, the Bond Trustee, so as to preserve such security interest while giving the Partners (except for the Liquidation GP), directly or indirectly, the pro rata interests they are entitled to. 

 

 Section 12.5           Termination of Partnership. 

 

 The Partnership will terminate when all of its assets have been sold and the net proceeds therefrom, after payment of or due provision for the payment of all debts, liabilities and obligations of the Partnership to creditors and all reserves, have been distributed as provided in this Article 12. 

 

 

 ARTICLE 13 

 AMENDMENTS 

 

 Section 13.1           Generally. 

 

 Subject to Section 13.2, this Agreement may be amended only in writing and only by a unanimous resolution of the Partners and while there are Covered Bonds outstanding, with the consent of the Bond Trustee and each such proposed amendment or waiver of this Agreement requiring the consent of the Partners shall be subject to Rating Agency Confirmation. 

    

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 Section 13.2           Amendments by the Managing GP. 

 

	
    

	
 (1) 

	
 From time to time and without prior notice to, or the consent of, any Partner, the Managing GP may amend any provision of this Agreement or add any provision hereto if such amendment or addition is, in the opinion of counsel to the Partnership, necessary or desirable for the protection or benefit of the Limited Partner or necessary or desirable to cure an ambiguity in, or to correct or supplement, any provision contained in this Agreement which is defective or inconsistent with any other provision contained in this Agreement or any of the Transaction Documents, provided that such cure, correction or supplemental provision does not and will not affect adversely the interests of the Limited Partner, the Liquidation GP, or, while there are Covered Bonds outstanding, the Bond Trustee (on behalf of the Holders of the Covered Bonds or the Secured Creditors) without such Person’s written consent. 

 

	
    

	
 (2) 

	
 For purposes of greater certainty and without limiting Section 13.2(1), the Managing GP may make amendments to this Agreement (subject to the consent of the Limited Partner, the Liquidation GP, or, while there are Covered Bonds outstanding the Bond Trustee if its interests would be adversely affected) to reflect: 

 

	
    

	
 (a) 

	
 a change in the name of the Partnership or the location of the principal office of the Partnership or the registered office of the Partnership; 

 

	
    

	
 (b) 

	
 the admission, substitution, withdrawal or removal of the Limited Partner in accordance with this Agreement; 

 

	
    

	
 (c) 

	
 a change that, as determined by the Managing GP, is reasonable and necessary or appropriate to qualify or continue the qualification of the Partnership as a limited partnership in which the Limited Partner has limited liability under the applicable laws; 

 

	
    

	
 (d) 

	
 a change that, as determined by the Managing GP, is reasonable, necessary or appropriate to enable the Partnership to take advantage of, or not be detrimentally affected by, changes in the Income Tax Act or other taxation laws; or 

 

	
    

	
 (e) 

	
 a change to amend or add any provision, or to cure any ambiguity or to correct or supplement any provisions contained in this Agreement that may be defective or inconsistent with any other provision contained in the Agreement or any of the Transaction Documents, or which should be made to make the Agreement consistent with the disclosure set out in the Prospectus. 

 

 Section 13.3           Notice of Amendment. 

 

 The Managing GP shall notify or shall cause notice to be delivered to each of the other Partners and, while there are Covered Bonds outstanding, the Bond Trustee and the Rating Agencies, of the full details of any amendment, variation or waiver to this Agreement or any other Transaction Document to which it is a party within 5 Business Days of the effective date of such amendment provided that failure to deliver such notice shall not constitute a breach of its obligations under this Agreement or any other Transaction Document. 

 

    

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 ARTICLE 14 

 CONFIDENTIALITY 

 

 Section 14.1           Confidentiality. 

 

	
    

	
 (1) 

	
 Subject to Section 14.1(2) below, each of the Partners agrees not to disclose to any person any information relating to the business, finances or other matters of a confidential nature of or relating to any other party to this Agreement or any of the Transaction Documents which it may have obtained as a result of having entered into this Agreement or otherwise. 

 

	
    

	
 (2) 

	
 The provisions of Section 14.1(1) above shall not apply: 

 

	
    

	
 (a) 

	
 to the disclosure of any information to any person who is a party to any of the Transaction Documents as expressly permitted by the Transaction Documents; 

 

	
    

	
 (b) 

	
 to the disclosure of any information which is or becomes public knowledge otherwise than as a result of the wrongful conduct of the recipient; 

 

	
    

	
 (c) 

	
 to the extent that the recipient is required to disclose the same pursuant to any law or order of any court or pursuant to any direction or requirement (whether or not having the force of law) of any central bank or any governmental or other regulatory, securities or taxation authority; 

 

	
    

	
 (d) 

	
 to the extent required to protect or enforce any of its rights under any of the Transaction Documents or hereunder or for the purpose of discharging, in such manner as it thinks fit, its duties under or in connection with such agreements in each case to such persons as require to be informed of such information for such purposes; 

 

	
    

	
 (e) 

	
 to the disclosure of any information to professional advisers who receive the same under a duty of confidentiality; 

 

	
    

	
 (f) 

	
 to the disclosure of any information with the consent of the parties to this Agreement and, while there are Covered Bonds outstanding, the Bond Trustee; 

 

	
    

	
 (g) 

	
 to the disclosure to the Rating Agencies or any of them of such information as may be requested by any of them for the purposes of setting or reviewing the rating assigned to the Covered Bonds (or any of them), provided that no information which would disclose the identity of a Borrower shall be disclosed to the Rating Agencies or any of them; or 

    

 

 -39- 

    

 

	
    

	
 (h) 

	
 to the disclosure of any information disclosed to a prospective transferee of the Limited Partner (provided that it is disclosed on the basis that the recipient will hold it confidential). 

 

 

 ARTICLE 15 

 MISCELLANEOUS 

 

 Section 15.1           Effective Time. 

 

 This Agreement shall be effective at 12:00 a.m. (Toronto time) on the date first noted above. 

 

 Section 15.2           Notices. 

 

	
    

	
 (1) 

	
 Any notice, direction or other communication given under this Agreement shall be in writing and given by delivering it or sending it by prepaid first class mail to, in the case of the Bond Trustee the address provided below and in the case of the Partners, to the registered office of such person set forth in the Record, or by facsimile transmission to facsimile number set forth below, as applicable: 

 

	
    

	
 (a) 

	
 in the case of the Partnership to: 

 RBC Covered Bond Guarantor Limited Partnership 

 155 Wellington Street West, 14th Floor 

 Toronto, Ontario 

 Canada M5V 3K7 

 Attention: Ann Milne, Senior Manager 

 Facsimile number: (416) 976-6056 

	
    

	
 (b) 

	
 in the case of the Managing GP to: 

 155 Wellington Street West, 14th Floor 

 Toronto, Ontario 

 Canada M5V 3K7 

 Attention: Ann Milne, Senior Manager 

 Facsimile number: (416) 976-6056 

	
    

	
 (c) 

	
 in the case of the Liquidation GP to: 

 6848320 Canada Inc. 

 100 University Avenue 

 9th Floor, North Tower 

 Toronto, Ontario 

 Canada  M5J 2Y1 

 Attention: Manager, Corporate Trust 

 Facsimile number: (416) 981-9777 

 

    

 -40- 

    

 

	
    

	
 (d) 

	
 in the case of the Limited Partner to: 

 Royal Bank of Canada 

 155 Wellington Street West, 14th Floor 

 Toronto, Ontario 

 Canada M5V 3K7 

 Attention: Ann Milne, Senior Manager 

 Facsimile number: (416) 976-6056 

	
    

	
 (e) 

	
 in the case of the Bond Trustee to: 

 Computershare Trust Company of Canada 

 100 University Avenue 

 9th Floor, North Tower 

 Toronto, Ontario 

 Canada M5J 2Y1 

 Attention: Manager, Corporate Trust 

 Facsimile number: (416) 981-9777 

 

	
    

	
 (2) 

	
 Any such communication will be deemed to have been validly and effectively given (i) if personally delivered, on the date of such delivery if such date is a Business Day and such delivery was made prior to 4:00 p.m. (Toronto time) and otherwise on the next Business Day, (ii) in the case of first class post, when it would be received in the ordinary course of the post, or (ii) if transmitted by facsimile transmission on the Business Day following the date of transmission provided the transmitter receives a confirmation of successful transmission. 

 

	
 (3) 

	
 Any party may change its address for notice, or facsimile contact information for service from time to time by notice given in accordance with the foregoing and any subsequent notice shall be sent to such party at its changed address, or facsimile contact information, as applicable. 

 

 Section 15.3           Time of the Essence. 

 

 Time will be of the essence of this Agreement. 

 

 Section 15.4           Third Party Beneficiaries. 

 

 Except as expressly otherwise provided herein, the parties intend that this Agreement will not benefit or create any right or cause of action in, or on behalf of, any Person other than the parties hereto and no Person, other than a party will be entitled to rely on the provisions of this Agreement in any action, suit, proceeding, hearing or other forum. 

 

    

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 Section 15.5           Bond Trustee. 

 

	
    

	
 (1) 

	
 It is hereby acknowledged and agreed that by its execution of this Agreement the Bond Trustee shall not assume or have any of the obligations or liabilities of the Partnership or any of the Partners under this Agreement and that the Bond Trustee has agreed to become a party to this Agreement for the purpose only of taking the benefit of this Agreement, including the right of the Bond Trustee to agree to amendments to the terms hereof.  For greater certainty, the parties to this Agreement acknowledge that the rights and obligations of the Bond Trustee are governed by the terms of the Trust Deed and the Security Agreement.  Any liberty or right which may be exercised or determination which may be made under this Agreement by the Bond Trustee may be exercised or made in the Bond Trustee's absolute discretion without any obligation to give reasons therefore and the Bond Trustee shall not be responsible for any liability occasioned by so acting if acting in accordance with the terms of the Trust Deed and the Security Agreement, but without prejudice to the obligation of the Bond Trustee to act reasonably. 

 

	
    

	
 (2) 

	
 In the event that there is any change in the identity of the Bond Trustee, the Managing GP, and the Partners, if required, shall execute such documents with any other parties to this Agreement and take such actions as such new Bond Trustee may reasonably require for the purposes of vesting in such new Bond Trustee the rights of the Bond Trustee under this Agreement and under the Security Agreement and while any of the Covered Bonds remain outstanding shall give notice thereof to the Rating Agencies. 

 

 Section 15.6           Binding Effect. 

 

 This Agreement will be binding upon and enure to the benefit of the parties hereto and any partner who may from time to time be admitted to the Partnership in accordance with the terms of this Agreement, their respective successors and, to the extent permitted hereunder, assigns. 

 

 Section 15.7           Further Assurances. 

 

 The parties will perform and cause to be performed any further and other acts and things and execute and deliver or cause to be executed and delivered any further and other documents as may be reasonably necessary to carry out the terms and intent of this Agreement. 

 

    

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 Section 15.8           Limited Partner not a General Partner. 

 

 If any provision of this Agreement has the effect of imposing upon the Limited Partner any of the liabilities or obligations of a general partner, such provision will be of no force and effect but the remainder of this Agreement will continue in effect. 

 

	
 Section 15.9            

	
 Waiver. 

 

	
    

	
 (1) 

	
 No waiver of any of the provisions of this Agreement will be deemed to constitute a waiver of any other provision (whether or not similar), nor will such waiver be binding unless executed in writing by the party to be bound by the waiver. 

 

	
    

	
 (2) 

	
 No failure on the part of a party to exercise, and no delay in exercising, any right under this Agreement will operate as a waiver of such right; nor will any single or partial exercise of any such right preclude any other or further exercise of such right or the exercise of any other right. 

 

 Section 15.10        Successors and Assigns. 

 

	
    

	
 (1) 

	
 This Agreement will be binding upon and enure to the benefit of the parties and their respective successors and permitted assigns. 

 

	
    

	
 (2) 

	
 Neither this Agreement nor any of the rights or obligations under this Agreement will be assignable or transferable by any party except in accordance with the terms of this Agreement. 

 

 Section 15.11        Severability. 

 

 If any provision of this Agreement is determined by any court of competent jurisdiction to be illegal, invalid or unenforceable, that provision will be severed from this Agreement and the remaining provisions will continue in full force and effect. 

 

 Section 15.12        Governing Law. 

 

 This Agreement will be governed by and interpreted and enforced in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. 

 

 Section 15.13        Counterparts. 

 

 This Agreement may be executed in any number of counterparts (including counterparts by facsimile) and all such counterparts taken together will be deemed to constitute one and the same instrument. 

 

 Section 15.14         No Personal Liability for Limited Partners. 

 

 No limited partner shall have any liability as a general partner of the Partnership. 

 

    

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 Section 15.15        Submission to Jurisdiction. 

 

 Each Partner irrevocably submits to the jurisdiction of the courts of Ontario in respect of any action or proceeding relating in any way to this Agreement. 

 

 [Remainder of this page is intentionally left blank] 

 

 

 

 

 

 

    

 -44- 

    

 IN WITNESS WHEREOF the parties have entered into this Limited Partnership Agreement as of the date first above written. 

 

	    	    	
 RBC COVERED BOND GP INC. 

 

	
 Per: 

	 /s/ David Power 
	    	
 Name: David Power 

	    	
 Title:  President 

	    	    	    	    
	    	    	
 6848320 CANADA INC. 

 

	
 Per: 

	 /s/ David Power 
	    	
 Name: David Power 

	
    

 

	
 Title: Director 

	    	
 Per: 

	 /s/ Stacie Moore 
	    	    	
 Name: Stacie Moore 

	    	    	
 Title: Vice President 

	    	    	    	    
	   	   	   	   
	    	    	
 ROYAL BANK OF CANADA 

 

	
 Per: 

	 /s/ James Salem 
	    	
 Name: James Salem 

	
    

 

	
 Title:  Senior Vice-President and Treasurer 

	
 Per: 

	 /s/ David Power 
	    	
 Name: David Power 

	    	
 Title:  Vice-President, Corporate Treasury 

	    	    	    	    
	   	   	   	   
	    	    	
 COMPUTERSHARE TRUST COMPANY OF CANADA 

 

	
 Per: 

	 /s/ Mircho Mirchev 
	    	
 Name: Mircho Mirchev 

	
    

 

	
 Title: Corporate Trust Officer 

	
 Per: 

	 /s/ Ann Samuel 
	    	
 Name: Ann Samuel 

	    	
 Title: Associate Trust Officer 

 

 Amended and Restated Guarantor LP Agreement (signature page) 

 

    

 

    

 

 Schedule 1 

 

 Additional Representations and Warranties 

 

	
 (a) 

	
 No encumbrance exists over or in respect of any of its assets. 

 

	
 (b) 

	
 It has not engaged in any activities since its incorporation other than: 

 

	
    

	
 (i) 

	
 those incidental to its registration under the Canada Business Corporations Act; 

 

	
    

	
 (ii) 

	
 other appropriate corporate steps; 

 

	
    

	
 (iii) 

	
 the authorisation and execution of the relevant Transaction Documents; and 

 

	
    

	
 (iv) 

	
 the activities referred to or contemplated by the relevant Transaction Documents as being performed by it in the Prospectus. 

 

	
 (c) 

	
 Since its date of incorporation there has been no material adverse change in its financial position or prospects. 

 

	
 (d) 

	
 It is not the subject of any governmental or official investigation or inquiry and to its knowledge, none is progressing or pending or has been threatened in writing against it, which may have a material adverse effect on any of it, any relevant Transaction Document, and/or the issue and offering of Covered Bonds under the Programme. 

 

	
 (e) 

	
 No litigation, arbitration or administrative proceedings of or before any court, tribunal or governmental body has been commenced or, so far as it is aware are pending or threatened against it or any of its assets or revenues which may have a material adverse effect on it, any relevant Transaction Document and/or the issue and offering of Covered Bonds under the Programme. 

 

	
 (f) 

	
 It has at all times carried on and conducted its affairs and business in its own name as a separate entity and in accordance with its constating documents and all laws and regulations applicable to it and shall continue to do so throughout the continuation of the Partnership. 

 

	
 (g) 

	
 It has at all times kept or procured the keeping of proper books of account and records separate from any person or entity. 

 

	
 (h) 

	
 All acts, conditions and things required to be done, fulfilled and performed in order: 

 

    

 1-1 

    

 

	
    

	
 (i) 

	
 to enable it to  lawfully enter into each relevant Transaction Document; 

 

	
    

	
 (ii) 

	
 to enable it lawfully to exercise its rights under and perform and comply with the obligations expressed to be assumed by it in the relevant Transaction Documents; 

 

	
    

	
 (iii) 

	
 to ensure that the obligations expressed to be assumed by it in the relevant Transaction Documents are legal, valid, binding and enforceable against it; and 

 

	
    

	
 (iv) 

	
 have been, fulfilled and performed and in full force and effect or, as the case may be have been effected, and no steps have been taken to challenge, revoke or cancel any such authorization obtained or effected. 

 

	
 (i) 

	
 It has duly executed the relevant Transaction Documents. 

 

	
 (j) 

	
 Its entry into and the execution (and, where appropriate, delivery) of the relevant Transaction Documents and the performance by it of its obligations under the relevant Transaction Documents do not and will not conflict with or constitute a breach or infringement of: 

 

	
    

	
 (i) 

	
 its articles or by-laws; 

 

	
    

	
 (ii) 

	
 any law applicable to it; or 

 

	
    

	
 (iii) 

	
 any agreement, indenture, contract, mortgage, deed or other instrument to which it is a party or which is binding on it or any of its assets. 

 

	
 (k) 

	
 The obligations expressed to be assumed by it under the relevant Transaction Documents are legal and valid obligations, binding on it and enforceable against it in accordance with their terms. 

 

	
 (l) 

	
 The Transaction Documents to which it is a party have been entered into in good faith for its own benefit and on arm's length commercial terms. 

 

	
 (m) 

	
 It is not in breach of or default under any agreement, indenture, contract, mortgage, deed or other instrument to which it is a party or which is binding on it or any of its assets. 

 

	
 (n) 

	
 It is not necessary that any relevant Transaction Document in relation to it be filed, recorded or enrolled with any court or other authority in any jurisdiction in which the assets of the Partnership or the Liquidation GP are located. 

 

	
 (o) 

	
 It does not require the consent of any other party or the consent, licence, approval or authorisation of any Governmental Authority in connection with the entering into or performance of the relevant Transaction Documents. 

 

    

 1-2 

    

 

 Schedule 2 

 

 Asset Coverage Test 

	
 (a) 

	
 The “Asset Coverage Test” is met if the Adjusted Aggregate Loan Amount (as defined below) shall be in an amount at least equal to the Canadian Dollar Equivalent of the aggregate Principal Amount Outstanding of the Covered Bonds as calculated on the relevant Calculation Date. For greater certainty, references in this Schedule to “immediately preceding Calculation Date” and “previous Calculation Date” are to the Calculation Period ending on the Calculation Date. 

 

	
 (b) 

	
 For the purposes of the Asset Coverage Test the “Adjusted Aggregate Loan Amount” means the amount calculated as at each Calculation Date as follows: 

 

 A+B+C+D-Z 

 

 where, 

 

 A           =           the lower of (i) and (ii), where: 

 

 (i)           =           the sum of the “LTV Adjusted True Balance” of each Loan in the Covered Bond Portfolio, which shall be the lower of (1) the actual True Balance of the relevant Loan in the Covered Bond Portfolio on such Calculation Date, and (2) the Latest Valuation relating to that Loan multiplied by M (where for all Loans that are less than three months in arrears or not in arrears, M = 80% (or such higher percentage as may be agreed by the Rating Agencies with respect to insured Loans) and for all Non-Performing Loans M = 0), 

 

 minus 

 

 the aggregate sum of the following deemed reductions to the aggregate LTV Adjusted True Balance of the Loans in the Covered Bond Portfolio if any of the following occurred during the previous Calculation Period: 

 

 (1)           a Loan or its Related Security was, in the immediately preceding Calculation Period, in breach of the Representations and Warranties contained in the Mortgage Sale Agreement or subject to any other obligation of the Seller to repurchase the relevant Loan and its Related Security, and in each case the Seller has not repurchased the Loan or Loans of the relevant Borrower and its or their Related Security to the extent required by the terms of the Mortgage Sale Agreement. In this event, the aggregate LTV Adjusted True Balance of the Loans in the Covered Bond Portfolio on such Calculation Date will be deemed to be reduced by an amount equal to the LTV Adjusted True Balance of the relevant Loan or Loans on such Calculation Date of the relevant Borrower; and/or 

 

    

 2-1 

    

 

 (2)           the Seller, in any preceding Calculation Period, was in breach of any other material warranty under the Mortgage Sale Agreement and/or the Servicer was, in any preceding Calculation Period, in breach of a material term of the Servicing Agreement. In this event, the aggregate LTV Adjusted True Balance of the Loans in the Covered Bond Portfolio on such Calculation Date will be deemed to be reduced by an amount equal to the resulting financial loss incurred by the Partnership in the immediately preceding Calculation Period (such financial loss to be calculated by the Cash Manager without double counting and to be reduced by any amount paid (in cash or in kind) to the Partnership by the Seller to indemnify the Partnerhsip for such financial loss); 

 

 AND 

 

 (ii)           =           the aggregate “Asset Percentage Adjusted True Balance” of the Loans in the Covered Bond Portfolio which in relation to each Loan shall be the lower of (1) the actual True Balance of the relevant Loan as calculated on such Calculation Date, and (2) the Latest Valuation relating to that Loan multiplied by N (where for all Loans that are less than three months in arrears or not in arrears, N = 1 and for all Non-Performing Loans N = 0); 

 

 minus 

 

 the aggregate sum of the following deemed reductions to the aggregate Asset Percentage Adjusted True Balance of the Loans in the Covered Bond Portfolio if any of the following occurred during the previous Calculation Period: 

 

 (1)           a Loan or its Related Security was, in the immediately preceding Calculation Period, in breach of the Representations and Warranties contained in the Mortgage Sale Agreement or subject to any other obligation of the Seller to repurchase the relevant Loan and its Related Security, and in each case the Seller has not repurchased the Loan or Loans of the relevant Borrower and its or their Related Security to the extent required by the terms of the Mortgage Sale Agreement. In this event, the aggregate Asset Percentage Adjusted True Balance of the Loans in the Covered Bond Portfolio on such Calculation Date will be deemed to be reduced by an amount equal to the Asset Percentage Adjusted True Balance of the relevant Loan or Loans on such Calculation Date of the relevant Borrower; and/or 

 

    

 2-2 

    

 

 (2)           the Seller, in any preceding Calculation Period, was in breach of any other material warranty under the Mortgage Sale Agreement and/or the Servicer was, in the immediately preceding Calculation Period, in breach of a material term of the Servicing Agreement. In this event, the aggregate Asset Percentage Adjusted True Balance of the Loans in the Covered Bond Portfolio on such Calculation Date will be deemed to be reduced by an amount equal to the resulting financial loss incurred by the Partnership in the immediately preceding Calculation Period (such financial loss to be calculated by the Cash Manager without double counting and to be reduced by any amount paid (in cash or in kind) to the Partnership by the Seller to indemnify the Partnership for such financial loss), 

 

 the result of the calculation in this paragraph (ii) being multiplied by the Asset Percentage (as defined below); 

 

 AND 

 

 (iii) With respect to any such calculations, any Loan included in the Covered Bond Portfolio secured on a Property which also secures one or more other Loans included in the Covered Bond Portfolio, any breach of the Loan Representations and Warranties in respect of one such Loan will be deemed to be a breach in respect of all such Loans in the Covered Bond Portfolio secured on the same Property; 

 

 B           =           the aggregate amount of any Principal Receipts on the Loans in the Covered Bond Portfolio up to such Calculation Date (as recorded in the Principal Ledger) which have not been applied as at such Calculation Date to acquire further Loans and their Related Security or otherwise applied in accordance with the Article 6 (Priorities of Payments) and/or the other Transaction Documents; 

 

 C           =           the aggregate amount of any Cash Capital Contributions made by the Partners (as recorded in the Capital Account Ledger for each Partner of the Guarantor LP) or proceeds advanced under the Intercompany Loan Agreement which have not been applied as at such Calculation Date to acquire further Loans and their Related Security or otherwise applied in accordance with Article 6 (Priorities of Payments) and/or the other Transaction Documents; 

 

 D           =           the aggregate outstanding principal balance of any Substitute Assets and/or Authorized Investments, as applicable; 

 

 Z           =           the weighted average remaining maturity expressed in years of all Covered Bonds then outstanding multiplied by the Canadian Dollar Equivalent of the aggregate Principal Amount Outstanding of the Covered Bonds multiplied by the Negative Carry Factor where the “Negative Carry Factor” is (i) .5% if the weighted average margin of the interest rate payable on the Covered Bonds is less or equal to  .1% per annum, or (ii) .5% plus that margin minus .1%, if that margin is greater than .1% per annum (provided that if the weighted average remaining maturity is less than one, the weighted average shall be deemed, for the purposes of this calculation, to be one). 

 

    

 2-3 

    

 

	
 (c) 

	
 The “Asset Percentage” shall be determined as follows: 

 

 (1) On or prior to the Guarantor LP Payment Date immediately following the Cash Flow Model Calculation Date (as defined below) falling in February, May, August and November of each year, and on such other date as the Limited Partner may request following the date on which the Bank is required to assign the Interest Rate Swap Agreement to a third party (each such date, a “Cash Flow Model Calculation Date”), the Managing GP (or the Cash Manager on its behalf) will notify the Rating Agencies of the percentage figure determined by it as the Asset Percentage, being the over-collateralization required, in connection with any other factors considered by the Rating Agencies, to ensure that the Covered Bonds maintain the initial rating assigned to the Covered Bonds of any Series by each Rating Agency based on the various methodologies of the Rating Agencies. Such methodologies shall be applied to the value of the Loans in the Covered Bond Portfolio as at the Calculation Date immediately preceding such Cash Flow Model Calculation Date (being such values for the Loans in the Covered Bond Portfolio on the Calculation Date in January, April, July or October, as applicable) as a whole or on the basis of a sample of Randomly Selected Loans in the Covered Bond Portfolio. 

 ( 

 2) The Asset Percentage will from time to time be adjusted in accordance with the above to ensure that sufficient over-collateralization will be maintained to, in connection with the other factors considered by the Rating Agencies, maintain the initial ratings assigned to the Covered Bonds of any Series by each Rating Agency. If the Asset Percentages determined in accordance with the foregoing are not the same in respect of a particular Cash Flow Model Calculation Date, the lowest such figure will be applied as the applicable Asset Percentage. 

 

 (3) The Managing GP (or the Cash Manager on its behalf) will, or will use all reasonable efforts to determine the Asset Percentage at least two days prior to the Guarantor LP Payment Date following a relevant Cash Flow Model Calculation Date and shall apply such Asset Percentage to any calculations in respect of the Calculation Period ending on such Cash Flow Model Calculation Date and each Calculation Period thereafter until the following Calculation Period ending on a Cash Flow Model Calculation Date in respect of which the Asset Percentage is to be determined in accordance with this Schedule 2. 

 

 (4) Notwithstanding anything to the contrary in this Schedule 2, the Asset Percentage may not, at any time, exceed 93% or, unless otherwise agreed by the Issuer (and following an Issuer Event of Default, the Partnership for the purposes of making certain determinations in respect of the Intercompany Loan), be less than 90%. 

 

    

 2-4 

    

 

 Schedule 3 

 

 Amortization Test 

 

	
    

	
 (1) 

	
 The “Amortization Test” is met if the Aggregate Loan Amount (as defined below) is in an amount at least equal to the Canadian Dollar Equivalent of the aggregate Principal Amount Outstanding of the Covered Bonds as calculated on the relevant Calculation Date. For greater certainty, references herein to “immediately preceding Calculation Date” and “previous Calculation Date” are to the Calculation Period ending on the Calculation Date. 

 

	
    

	
 (2) 

	
 For the purposes of the Amortization Test, the “Aggregate Loan Amount” will mean the amount calculated as at each Calculation Date as follows: 

 

 A + B + C - Z 

 

   where, 

 

	
    

	
 A 

	
 = 

	
 the aggregate “Amortization Test True Balance” of each Loan, which shall be the lower of (1) the actual True Balance of the relevant Loan as calculated on such Calculation Date, and (2) the Latest Valuation multiplied by M (where for all the Loans that are less than three months in arrears or not in arrears M = 80% (or such higher percentage as may be agreed by the Rating Agencies with respect to insured Loans) and or for all the Non-Performing Loans M = 0); 

 

	
    

	
 B 

	
 = 

	
 the sum of the amount of any cash standing to the credit of the Guarantor LP Accounts (excluding any Revenue Receipts received in the immediately preceding Calculation Period); 

 

	
    

	
 C 

	
 = 

	
 the aggregate outstanding principal balance of any Substitute Assets and/or Authorized Investments, as applicable; and 

 

	
    

	
 Z 

	
 = 

	
 the weighted average remaining maturity of all Covered Bonds then outstanding multiplied by the Canadian Dollar Equivalent of the aggregate Principal Amount Outstanding of the Covered Bonds multiplied by the Negative Carry Factor. 

 

    

 3-1 

    

 

 Schedule 4 

 

 Pre-Acceleration Revenue Priority Of Payments 

 

 (a)           first, in or towards satisfaction of any amounts due and payable by the Partnership to third parties and incurred without breach by the Partnership of the Transaction Documents to which it is a party (and for which payment has not been provided for elsewhere in the relevant Priorities of Payments) and to provide for any such amounts expected to become due and payable by the Partnership in the immediately succeeding Guarantor LP Payment Period and to pay and discharge any liability of the Partnership for taxes; 

 

 (b)           second, any amounts in respect of interest due to the Bank in respect of the Demand Loan pursuant to the terms of the Intercompany Loan; 

 

 (c)           third, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of: 

 

 (i)           any remuneration then due and payable to the Servicer and any costs, charges, liabilities and expenses then due or to become due and payable to the Servicer under the provisions of the Servicing Agreement in the immediately succeeding Guarantor LP Payment Period, together with applicable GST (or other similar taxes) thereon to the extent provided therein; 

 

 (ii)           any remuneration then due and payable to the Cash Manager and any costs, charges, liabilities and expenses then due or to become due and payable to the Cash Manager under the provisions of the Cash Management Agreement in the immediately succeeding Guarantor LP Payment Period, together with applicable GST (or other similar taxes) thereon to the extent provided therein; 

 

 (iii)           amounts (if any) due and payable to the Account Bank (or, as applicable, the Standby Account Bank) (including costs) pursuant to the terms of the Bank Account Agreement (or, as applicable, the Standby Bank Account Agreement), together with applicable GST (or other similar taxes) thereon to the extent provided therein; and 

 

 (iv)           amounts due and payable to the Asset Monitor pursuant to the terms of the Asset Monitor Agreement (other than the amounts referred to in paragraph (viii) below), together with applicable GST (or other similar taxes) thereon to the extent provided therein; 

 

 (d)           fourth, in or towards payment due to the Interest Rate Swap Provider (including any termination payment due and payable by the Partnership under the Interest Rate Swap Agreement (but excluding any Excluded Swap Termination Amount)) pursuant to the terms of the Interest Rate Swap Agreement; 

 

    

 4-1 

    

 

 (e)           fifth, in or towards payment on the Guarantor LP Payment Date of, or to provide for payment on such date in the future of such proportion of the relevant payment falling due in the future as the Cash Manager may reasonably determine (and in the case of any such payment or provision, after taking into account any provisions previously made and any amounts receivable from the Interest Rate Swap Provider under the Interest Rate Swap Agreement, of any amounts due to become due and payable (excluding principal amounts), to the Bank in respect of the Guarantee Loan pursuant to the terms of the Intercompany Loan Agreement; 

 

 (f)           sixth, if a Servicer Event of Default has occurred, all remaining Available Revenue Receipts to be credited to the GIC Account (with a corresponding credit to the Revenue Ledger maintained in respect of that account) until such Servicer Event of Default is either remedied by the Servicer or waived by the Bond Trustee or a new servicer is appointed to service the Covered Bond Portfolio (or the relevant part thereof); 

 

 (g)           seventh, in or towards a credit to the Reserve Ledger on the GIC Account of an amount up to but not exceeding the amount by which the Reserve Fund Required Amount (if applicable) exceeds the existing balance on the Reserve Ledger as calculated on the immediately preceding Calculation Date; 

 

 (h)           eighth, payment of any Excluded Swap Termination Amounts due and payable by the Partnership under the Interest Rate Swap Agreement; 

 

 (i)           ninth, in or towards payment pro rata and pari passu in accordance with the respective amounts thereof of any indemnity amount due to the Asset Monitor pursuant to the Asset Monitor Agreement, and any indemnity amount due to any Partner pursuant to the terms of this Agreement; 

 

 (j)           tenth, in or towards payment of the fee due to the Corporate Services Provider by the Guarantor LP pursuant to the terms of the Corporate Services Agreement; and 

 

 (k)           eleventh, towards such distributions of profit to the Partners as may be payable in accordance with the terms of this Agreement. 

 

 Any amounts received by the Partnership under the Interest Rate Swap Agreement on or after the Guarantor LP Payment Date but prior to the next following Guarantor LP Payment Date will be applied, together with any provision for such payments made on any preceding Guarantor LP Payment Date, to make payments (other than in respect of principal) due and payable in respect of the Intercompany Loan Agreement and then the expenses of the Partnership unless an Asset Coverage Test Breach Notice is outstanding or otherwise to make provision for such payments on such date in the future of such proportion of the relevant payment falling due in the future as the Cash Manager may reasonably determine. 

 

    

 4-2 

    

 

 Any amounts received under the Interest Rate Swap Agreement on the Guarantor LP Payment Date or on any date prior to the next succeeding Guarantor LP Payment Date which are not put towards a payment or provision in accordance with paragraph (d) above or the preceding paragraph will be credited to the Revenue Ledger and applied as Available Revenue Receipts on the next succeeding Guarantor LP Payment Date. 

 

 Amounts (if any) held by the Cash Manager for and on behalf of the Partnership or standing to the credit of the Transaction Account which are not required to be applied in accordance with paragraphs (a) to (k) of Schedule 4 Priority of Payments or paragraphs (a) to (e) of Schedule 5 will, if applicable, be deposited by the Cash Manager and, in each case be credited to the appropriate ledger in the GIC Account on the Guarantor LP Payment Date. 

 

 If any Swap Collateral Available Amounts are received by the Partnership on a Guarantor LP Payment Date, such amounts shall be applied by the Partnership (or by the Cash Manager on its behalf) on that Guarantor LP Payment Date in the same manner as it would have applied the receipts which such Swap Collateral Available Amounts replace. 

 

 Each Partner acknowledges that the distribution paid pursuant to Section (k) above to such Partner represents a reasonable commercial return to the Partner from its involvement in the Partnership and also agrees that such profits will not be paid to the Partners at a time when they know or ought to know that there was no reasonable prospect of avoiding an insolvent liquidation of the Partnership as a result of such profit distribution. 

 

 

 

 

 

 

    

 4-3 

    

 

 Schedule 5 

 

 Pre-Acceleration Principal Priority of Payments 

 

	
 (a) 

	
 first, to pay amounts in respect of principal outstanding on the Demand Loan pursuant to the terms of the Intercompany Loan Agreement; 

 

	
 (b) 

	
 second, to acquire New Loans and their Related Security offered to the Partnership, if necessary or prudent to ensure that, taking into account the other resources available to the Guarantor LP, the Asset Coverage Test is met and thereafter to acquire (in the discretion of the Managing GP or the Cash Manager on its behalf) Substitute Assets up to the prescribed limit and/or Authorized Investments; 

 

	
 (c) 

	
 third, to deposit the remaining Available Principal Receipts in the GIC Account (with a corresponding credit to the Principal Ledger) in an amount sufficient to ensure that, taking into account the other resources available to the Partnership, the Asset Coverage Test is met; 

 

	
 (d) 

	
 fourth, in or towards repayment on the Guarantor LP Payment Date (or to provide for repayment on such date in the future of such proportion of the relevant payment falling due in the future as the Cash Manager may reasonably determine) of amounts (in respect of principal) due or to become due and payable to the Issuer in respect of the Guarantee Loan; and 

 

	
 (e) 

	
 fifth, subject to complying with the Asset Coverage Test, to make Capital Distributions in accordance with the terms of this Agreement. 

 

    

 5-1 

    

 

 Schedule 6 

 

 Guarantee Priority of Payments 

 

	
 PART I 

 

	
 (a) 

	
 first, to pay any amounts in respect of principal and interest due to the Bank in respect of the Demand Loan pursuant to the terms of the Intercompany Loan Agreement; 

 

	
 (b) 

	
 second, in or towards payment of all amounts due and payable or to become due and payable to the Bond Trustee in the immediately succeeding Guarantee Payment Period under the provisions of the Trust Deed together with interest and applicable GST (or other similar taxes) thereon as provided therein; 

 

	
 (c) 

	
 third, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of: 

 

	
    

	
 (i) 

	
 any remuneration then due and payable to the Agents under the provisions of the Agency Agreement together with applicable GST (or other similar taxes) thereon as provided therein; and 

 

	
    

	
 (ii) 

	
 any amounts then due and payable by the Partnership to third parties and incurred without breach by the Partnership of the Transaction Documents to which it is a party (and for which payment has not been provided for elsewhere) and to provide for any such amounts expected to become due and payable by the Partnership in the immediately succeeding Guarantor LP Payment Period and to pay or discharge any liability of the Partnership for taxes; 

 

	
 (d) 

	
 fourth, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of: 

 

	
    

	
 (i) 

	
 any remuneration then due and payable to the Servicer and any costs, charges, liabilities and expenses then due or to become due and payable to the Servicer in the immediately succeeding Guarantor LP Payment Period under the provisions of the Servicing Agreement together with applicable GST (or other similar taxes) thereon to the extent provided therein; 

 

	
    

	
 (ii) 

	
 any remuneration then due and payable to the Cash Manager and any costs, charges, liabilities and expenses then due or to become due and payable to the Cash Manager in the immediately succeeding Guarantor LP Payment Period under the provisions of the Cash Management Agreement, together with applicable GST (or other similar taxes) thereon to the extent provided therein; 

 

 

    

 6-1 

    

 

	
    

	
 (iii) 

	
 amounts (if any) due and payable to the Account Bank (or, as applicable, the Standby Account Bank) (including costs) pursuant to the terms of the Bank Account Agreement (or, as applicable, the Standby Bank Account Agreement), together with applicable GST (or other similar taxes) thereon to the extent provided therein; and 

 

	
    

	
 (iv) 

	
 amounts due and payable to the Asset Monitor (other than the amounts referred to in paragraph (j) below) pursuant to the terms of the Asset Monitor Agreement, together with applicable GST (or other similar taxes) thereon as provided therein; 

 

	
 (e) 

	
 fifth, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of any amounts due and payable to the Interest Rate Swap Provider (including any termination payment due and payable by the Guarantor LP under the Interest Rate Swap Agreement but excluding any Excluded Swap Termination Amount) pursuant to the terms of the Interest Rate Swap Agreement; 

 

	
 (f) 

	
 sixth, to pay pro rata and pari passu according to the respective amounts thereof: 

 

	
    

	
 (i) 

	
 the amounts due and payable to the Covered Bond Swap Provider (other than in respect of principal) pro rata and pari passu in respect of each relevant Series of Covered Bonds (including any termination payment (other than in respect of principal) due and payable by the Partnership under the Covered Bond Swap Agreement but excluding any Excluded Swap Termination Amount) in accordance with the terms of the Covered Bond Swap Agreement; and 

 

	
    

	
 (ii) 

	
 to the Bond Trustee or (if to directed by the Bond Trustee) the Issuing and Paying Agent on behalf of the holders of the Covered Bonds pro rata and pari passu Scheduled Interest that is Due for Payment (or will become Due for Payment in the immediately succeeding Guarantor LP Payment Period) under the Covered Bond Guarantee in respect of each Series of Covered Bonds, 

 

 provided that if the amount available for distribution under this paragraph (f) (excluding any amounts received from the Covered Bond Swap Provider) would be insufficient to pay the Canadian Dollar Equivalent of the Scheduled Interest that is Due for Payment in respect of each Series of Covered Bonds under (f)(ii) above, the shortfall will be divided amongst all such Series of Covered Bonds on a pro rata basis and the amount payable by the Partnership in respect of each relevant Series of Covered Bonds to the Covered Bond Swap Provider under (f)(i) above will be reduced by the amount of the shortfall applicable to the Covered Bonds in respect of which such payment is to be made; 

 

    

 6-2 

    

 

	
 (g) 

	
 seventh, to pay or provide for pro rata and pari passu according to the respective amounts thereof, of: 

 

	
    

	
 (i) 

	
 the amounts (in respect of principal) due and payable pro rata and pari passu in respect of each relevant Series of Covered Bonds (including any termination payment (relating solely to principal) due and payable by the Partnership under the Covered Bond Swap Agreement but excluding any Excluded Swap Termination Amount) to the Covered Bond Swap Provider in accordance with the terms of the relevant Covered Bond Swap Agreement; and 

 

	
    

	
 (ii) 

	
 to the Bond Trustee or (if so directed by the Bond Trustee) the Issuing and Paying Agent on behalf of the holders of the Covered Bonds pro rata, and pari passu Scheduled Principal that is Due for Payment (or will become Due for Payment in the immediately succeeding Guarantor LP Payment Period) under the Covered Bond Guarantee in respect of each Series of Covered Bonds, provided that if the amount available for distribution under this paragraph (g) (excluding any amounts received from the Covered Bond Swap Provider) in respect of the amounts referred to in (g)(i) above would be insufficient to pay the Canadian Dollar Equivalent of the Scheduled Principal that is Due for Payment in respect of the relevant Series of Covered Bonds under this (g)(ii), the shortfall will be divided amongst all such Series of Covered Bonds on a pro rata basis and the amount payable by the Partnership in respect of each relevant Series of Covered Bonds under (g)(i) to the Covered Bond Swap Provider above will be reduced by the amount of the shortfall applicable to the Covered Bonds in respect of which such payment is to be made; 

 

	
 (h) 

	
 eighth, to deposit the remaining moneys into the GIC Account for application on the next following Guarantor LP Payment Date in accordance with the Priorities of Payment described in paragraphs (a) to (g) (inclusive) above, until the Covered Bonds have been fully repaid or provided for (such that the Required Redemption Amount has been accumulated in respect of each outstanding Series of Covered Bonds); 

 

	
 (i) 

	
 ninth, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of any Excluded Swap Termination Amount due and payable by the Partnership to the relevant Swap Provider under the relevant Swap Agreement; 

 

 

    

 6-3 

    

 

	
 (j) 

	
 tenth, after the Covered Bonds have been fully repaid or provided for (such that the Required Redemption Amount has been accumulated in respect of each outstanding Series of Covered Bonds), any remaining moneys will be applied in and towards repayment in full of amounts outstanding under the Intercompany Loan Agreement; 

 

	
 (k) 

	
 eleventh, in or towards satisfaction pro rata and pari passu according to the respective amounts thereof of any indemnity amount due to the Partners pursuant to the Guarantor LP Agreement and certain costs, expenses and indemnity amounts due by the Partnership to the Asset Monitor pursuant to the Asset Monitor Agreement; and 

 

	
 (l) 

	
 twelfth, thereafter any remaining moneys will be applied in accordance with this Agreement. 

 

 PART II 

 

 Any amounts received by the Partnership under the Interest Rate Swap Agreement after the Guarantor LP Payment Date but prior to the next following Guarantor LP Payment Date will be applied, together with any provision for such payment made on any preceding Guarantor LP Payment Date, to make payments (other than in respect of principal) due and payable pro rata and pari passu in respect of the Covered Bond Swap Agreement or, as the case may be, in respect of interest due under the Covered Bond Guarantee pro rata and pari passu in respect of each relevant Series of Covered Bonds. 

 

 Any amounts received by the Partnership under the Covered Bond Swap Agreement (whether or not in respect of principal) after the Guarantor LP Payment Date but prior to the next following Guarantor LP Payment Date will be applied, together with any provision for such payment made on any preceding Guarantor LP Payment Date, to make payments of interest or principal, as the case may be, in respect of the Covered Bond Guarantee pro rata and pari passu in respect of each relevant Series of Covered Bonds. 

 

 Any amounts received under the Interest Rate Swap Agreement or any Covered Bond Swap Agreement on the Guarantor LP Payment Date or any date prior to the next succeeding Guarantor LP Payment Date which are not put towards a payment or provision in accordance with paragraphs (f) or (g) of Part I of this Schedule 6 or the preceding paragraphs of Part II of this Schedule 6 will be credited to the Revenue Ledger or the Principal Ledger on the GIC Account (as appropriate) and applied as Available Revenue Receipts or Available Principal Receipts, as the case may be, on the next succeeding Guarantor LP Payment Date. 

 

 If the Partnership requires any available funds to be exchanged into a currency other than Canadian Dollars, and such exchange would not be subject to or covered by the terms of the Covered Bond Swap Agreement, then the Partnership (or the Cash Manager on its behalf) shall perform all necessary currency conversions at the then prevailing spot rate of exchange. 

 

 If any Swap Collateral Available Amounts are received by the Partnership on a Guarantor LP Payment Date, such amounts shall be applied by the Partnership (or by the Cash Manager on its behalf) on that Guarantor LP Payment Date in the same manner as it would have applied the receipts which such Swap Collateral Available Amounts replace. 

 

    

 6-4 

    

 

 Schedule 7 

 

 Priority of Payments when Covered Bonds Repaid 

 

 (a)           first, to apply any such monies which constitute Available Revenue Receipts in or towards payment of the fee due to the Corporate Services Provider by the Guarantor LP pursuant to the terms of the Corporate Services Agreement; 

 

 (b)           second, to apply any such monies which constitute Available Revenue Receipts towards payment pro rata and pari passu of distributions to the Partners in accordance with the terms of this Agreement; and 

 

 (c)           third, to make Capital Distributions of all remaining monies to the Partners pro rata and pari passu to their respective Capital Contribution Balances as calculated on the immediately preceding Calculation Date in accordance with the terms of this Agreement. 

 

 

 

 

 

 

    

 7-1 

    

 

 Schedule 8 

 

 Method for Sale of Selected Loans 

 

	
    

	
 (1) 

	
 Before offering Selected Loans and their Related Security for sale in accordance with this Schedule 8, the Partnership shall ensure that: 

 

	
    

	
 (a) 

	
 the Loans and their Related Security being sold are Randomly Seclected Loans; 

 

	
    

	
 (b) 

	
 the Selected Loans have an aggregate True Balance in an amount (the “Required True Balance Amount”) which is as close as possible to the amount calculated as follows: 

 

	
    

	
 (i) 

	
 following the service of an Asset Coverage Test Breach Notice (but prior to service of a Notice to Pay), such amount that would ensure that, if the Selected Loans were sold at their True Balance plus the Arrears of Interest and Accrued Interest thereon, the Asset Coverage Test would be satisfied on the next Calculation Date taking into account the payment obligations of the Partnership on the Payment Date following that Calculation Date (assuming for this purpose that the Asset Coverage Test Breach Notice is not revoked on the next Calculation Date); or 

 

	
    

	
 (ii) 

	
 following service of a Notice to Pay: 

 

	
 N x 

	
 True Balance of all the Loans in the Covered Bond Portfolio 

	    	
 the Canadian Dollar Equivalent of the Required Redemption Amount in respect of each Series of Covered Bonds then outstanding 

 

 where “N” is an amount equal to the Canadian Dollar Equivalent of the Required Redemption Amount (as defined below) of the Earliest Maturing Covered Bonds less amounts standing to the credit of the Guarantor LP Accounts and the principal amount of any Substitute Assets and/or Authorized Investments (excluding all amounts to be applied on the next following Guarantor LP Payment Date to repay higher ranking amounts in the Guarantee Priority of Payments and those amounts that are required to repay any Series of Covered Bonds which mature prior to or on the same date as the relevant Series of Covered Bonds). 

 

	
    

	
 (2) 

	
 The Partnership will offer the Selected Loans and their Related Security for sale to Purchasers for the best price reasonably available, in any event: 

 

	
    

	
 (a) 

	
 following the service of an Asset Coverage Test Breach Notice (but prior to the service of a Notice to Pay), for an amount not less than the True Balance of the Selected Loans plus the Arrears of Interest and Accrued Interest thereon; and 

 

    

 8-1 

    

 

	
    

	
 (b) 

	
 following service of a Notice to Pay, for an amount not less than the Adjusted Required Redemption Amount. 

 

	
    

	
 (3) 

	
 For purposes of the foregoing: 

 

 “Adjusted Required Redemption Amount” means, the Canadian Dollar Equivalent of the Required Redemption Amount, plus or minus the Canadian Dollar Equivalent of any swap termination amounts payable under the Covered Bond Swap Agreement to or by the Partnership in respect of the relevant Series of Covered Bonds less (where applicable) amounts held by the Cash Manager for and on behalf of the Guarantor LP and amounts standing to the credit of the Guarantor LP Accounts and the Canadian Dollar Equivalent of the principal balance of any Substitute Assets and/or any Authorized Investments (excluding all amounts to be applied on the next following Guarantor LP Payment Date to repay higher ranking amounts in the Guarantee Priority of Payments and those amounts that are required to repay any Series of Covered Bonds which mature prior to or on the same date as the relevant Series of Covered Bonds) plus or minus any swap termination amounts payable to or by the Partnership under the Interest Rate Swap Agreement; and 

 

 “Required Redemption Amount” means, in respect of a Series of Covered Bonds, the amount calculated as follows: 

 

	
 the Principal Amount Outstanding of the relevant Series of Covered Bonds 

	
 x 

	
 1+ Negative Carry Factor X (days to maturity of the relevant Series of Covered Bonds/365) 

 

	
    

	
 (4) 

	
 Following service of a Notice to Pay, if the Selected Loans have not been sold (in whole or in part) in an amount equal to the Adjusted Required Redemption Amount by the date which is six months prior to, as applicable: 

 

	
    

	
 (a) 

	
 the Final Maturity Date (where the Covered Bonds are not subject to an Extended Due for Payment Date in respect of the Covered Bond Guarantee); or 

 

	
    

	
 (b) 

	
 the Extended Due for Payment Date in respect of the Earliest Maturing Covered Bonds (after taking into account all payments, provisions and credits to be made in priority thereto) (where the Covered Bonds are subject to an Extended Due for Payment Date in respect of the Covered Bond Guarantee), 

 

    

 8-2 

    

 

 then the Partnership will offer the Selected Loans for sale for the best price reasonably available notwithstanding that such amount may be less than the Adjusted Required Redemption Amount. 

 

	
    

	
 (5) 

	
 In respect of any sale or refinancing of Selected Loans and their Related Security at any time an Asset Coverage Test Breach Notice is outstanding or a Notice to Pay has been served, the Partnership will instruct the portfolio manager to use all reasonable endeavours to procure that Selected Loans are sold as quickly as reasonably practicable (in accordance with the recommendations of the portfolio manager), taking into account the market conditions at that time and the scheduled repayment dates of the Covered Bonds and the terms of this Agreement. 

 

	
    

	
 (6) 

	
 Following the service of a Notice to Pay, if Purchasers accept the offer or offers from the Partnership so that some or all of the Selected Loans and their Related Security shall be sold prior to the next following Final Maturity Date or, if the Covered Bonds are subject to an Extended Due for Payment Date in respect of the Covered Bond Guarantee, the next following Extended Due for Payment Date in respect of the Earliest Maturing Covered Bonds, then the Partnership will, subject to paragraph (7) of this Schedule 8, enter into a sale and purchase agreement with the relevant Purchasers, which will require, inter alia, a cash payment from the relevant Purchasers. 

 

 

 

 

 8-3

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