Notice to Noteholders (9914Q)

TIDM49AH

RNS Number : 9914Q

Auburn Securities 5 PLC

27 October 2011

THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF NOTEHOLDERS. IF NOTEHOLDERS ARE IN ANY DOUBT AS TO THE ACTION THEY SHOULD TAKE, THEY SHOULD SEEK THEIR OWN FINANCIAL AND LEGAL ADVICE, INCLUDING AS TO ANY TAX CONSEQUENCES, IMMEDIATELY FROM THEIR STOCKBROKER, SOLICITOR, ACCOUNTANT OR OTHER INDEPENDENT FINANCIAL OR LEGAL ADVISER.

IMPORTANT NOTICE TO THE HOLDERS OF THE

GBP255,600,000 Class A2 Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228779764)

(Common Code: 022877976)

GBP20,000,000 Class M Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228780002)

(Common Code: 022878000)

GBP9,000,000 Class B Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228780341)

(Common Code: 022878034)

GBP18,000,000 Class C Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228780937)

(Common Code: 022878093)

GBP11,250,000 Class D Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228781158)

(Common Code: 022878115)

GBP5,650,000 Class E Mortgage Backed Floating Rate Notes due December 2041

(ISIN: XS0228781315)

(Common Code: 022878131)

(the "Notes")

issued by AUBURN SECURITIES 5 PLC (incorporated in England and Wales with limited liability under Registered Number 05462531) (the "Issuer") on 23 September 2005

Capitalised terms used but not otherwise defined herein shall have the meanings ascribed to them in the Terms and Conditions of the Notes set out in the Trust Deed (the "Trust Deed") dated 23 September 2005 (as amended) and entered into between the Issuer and Citicorp Trustee Company Limited (the "Trustee"), the master definitions schedule dated 23 September 2005 (the "Master Definitions Schedule") and the Amendment Deed (as defined below).

In accordance with their respective mortgage arrangements, customers of Capital Homes Limited (the "Originator") make mortgage payments into the Collection Account held at Barclays Bank PLC ("Barclays").

A majority of the mortgage customers make their mortgage payments by direct debit. Such electronic payments are made in accordance with the direct debit scheme (the "Scheme") and are governed by rules (the "Bacs Rules") established by BACS Payment Schemes Limited ("Bacs"). Barclays currently provides, as Account Bank, direct debit sponsorship to the Originator (the "Sponsorship"), together with related direct debit services (the "Services").

Pursuant to the Bacs Rules, any company that wishes to receive payments by direct debit must become a Bacs approved servicer user (a "Service User"). In accordance with the Bacs Rules prior to 30 April 2011, once approved, a Service User was allocated a single Service User number (a "SUN") that was used by financial institutions to correctly allocate direct debit payments to the relevant Service User. As required by the new Bacs Rules, the Originator has established separate SUNs for each of its various securitisation transactions.

Barclays provide Sponsorship for the Collection Account in relation to indemnity claims that may be made by customers against the Originator as the Service User.

The Bacs Rules were updated in October 2010 and the changes to make direct debit payments automatic came into effect on 30 April 2011. Before the changes to the Bacs Rules, indemnity claims were raised and settled manually by Barclays. Barclays have informed us that pursuant to the updated Bacs Rules, payments which are the subject of an indemnity claim will be required to be automatically clawed back from the Collection Account. In accordance with Barclays' new internal arrangements, any other amount (other than a direct debit amount) that has been returned unpaid, has been recalled, has been reversed or otherwise reclaimed, will also be automatically clawed back from the Collection Account.

Barclays' agreement to the continued provision of the Sponsorship and the Services is subject to certain modifications being made to the Documents to address concerns Barclays have in relation to their liability regarding customer payments made by direct debit and their compliance with rules governing payments made by direct debit. Such modifications include documenting and/or clarifying Barclays' right of set off against the Collection Account and Transaction Account in relation to liability that it may incur due to amounts paid by direct debit, cheque, charge card or any other method being returned unpaid, recalled, reversed or otherwise reclaimed for whatever reason.

Barclays confirmed to the Issuer that they would no longer agree to continue to provide Sponsorship or Services to the Originator in relation to the Collection Account unless the aforementioned modifications and clarifications were made by the relevant parties to the Documents. If Barclays had ceased to provide such Sponsorship or Services in relation to the Collection Account, amounts paid by customers using the Scheme would no longer have been able to be received into the Collection Account. This would have resulted in a material disruption to the funds available from customers to pay Noteholders in accordance with the Documents. Such a disruption may have meant that the Issuer would have insufficient funds to pay all amounts due to Noteholders under the Notes when they fall due. The Issuer therefore confirmed to the Trustee that it was in the interests of the Noteholders for the Trustee to consent to the modification of the Master Definitions Schedule, the Cash/Bond Administration Agreement, the Bank Agreement (Transaction Account) and the Trust Deed, on the terms of the Amendment Deed (as defined below) and the creation by the Originator of the new SUN so that Barclays agreed to continue to provide Sponsorship and Services in relation to the Collection Account and that there would be materially prejudicial implications for Noteholders if the Trustee had not done so. Furthermore, the Issuer concluded that, as far as it was aware and having made all reasonable enquiries, the only commercially feasible course was to accommodate Barclays' requirements.

It has come to the Issuer's attention that Barclays take out its normal banking transaction fees directly from the Bank Accounts on a payment transaction by transaction basis (in accordance with its usual banking arrangements), rather than just on an Interest Payment Date in accordance with the relevant priority of payments. Barclays has informed the Trustee and the Issuer that its transaction fees are typically no more than GBP500 per account per quarter and as such are de minimis in relation to the cash flows for the Transaction. As the transaction fees are paid to Barclays in priority to Noteholders pursuant to the priority of payments, the Issuer is satisfied that timing of the payment of such transaction fees is not materially prejudicial to the interests of Noteholders.

Please also note that Moody's and S&P have each provided a written confirmation to the Issuer that the implementation of the amendments will not, in and of itself, result in a reduction or withdrawal of the current ratings on the Notes.

In light of the above, an amendment deed dated 25 October 2011 (the "Amendment Deed") was entered into between, amongst others, Barclays, the Trustee and the Issuer in order to accommodate Barclays' requirements for the continued provision of Sponsorship and the Services. Such Amendment Deed is available for inspection at the registered office of the Issuer during normal business hours.

This Notice is given by the Issuer.

Should you have any queries concerning the information contained in this notice please contact:

Auburn Securities 5 plc

c/o Wilmington Trust SP Services (London) Limited

Third Floor

1 King's Arms Yard

London EC2R 7AF

Email: complianceteam@wilmingtontrust.com

27 October 2011

This information is provided by RNS

The company news service from the London Stock Exchange

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