ARM ASSET-BACKED SECURITIES S.A.

Transcription

1 SERIES PROSPECTUS R Capital Growth dated 12 September 2008 ARM ASSET-BACKED SECURITIES S.A. (A societe anonyme incorporated, existing and organised under the laws of the Grand Duchy of Luxembourg, and being a securitisation vehicle under the Luxembourg law of 22nd March 2004, under registered number104219) Up to GBP 11,850,000 ASSET-BACKED CAPITAL GROWTH BOND SERIES R 2015 (the Bonds ) The Issuer accepts responsibility for the information contained in this document. To the best of the knowledge and belief of the Issuer the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information. This document constitutes a prospectus (the Series Prospectus ) for the purposes of Directive 2003/71/EC (the Prospectus Directive ) as implemented in Ireland by the Prospectus (Directive 2003/71/EC) Regulations This document should be read in conjunction with the base prospectus issued by the Issuer and dated 11 September 2008 (the Base Prospectus ) which is incorporated by reference into this Series Prospectus. Defined words and phrases used in the Base Prospectus shall have the same meanings when used in this Series Prospectus. To the best of the Issuer s knowledge, information and belief there are no facts or circumstances which have occurred or arisen since the issue of the Base Prospectus which render any of the statements or facts stated therein untrue, inaccurate or misleading in any respect. Application has been made to the Irish Financial Services Regulatory Authority, as competent authority under the Prospectus Directive, for this Series Prospectus to be approved. Application has been made to the Irish Stock Exchange for the Bonds to be admitted to the Official List and trading on its regulated market. Such approval relates only to Bonds which are to be admitted to trading on the regulated market of the Irish Stock Exchange or other regulated markets for the purposes of Directive 2004/39/EC or which are to be offered to the public in any Member State of the European Economic Area. The Bonds will be issued in registered form ("Registered Bonds" comprising a "Registered Series") and will initially be represented by interests in a temporary Global Note or by a permanent Global Note, in either case in registered form (each a "Temporary Global Note" and a "Permanent Global Note", respectively) which may be deposited with a common depositary on behalf of Euroclear Bank S.A./N.V., as operator of the Euroclear System or any other successor entity thereto ("Euroclear") and Clearstream Banking, société anonyme, or any successor thereto ("Clearstream, Luxembourg"). For further detail in relation to Global Notes, see the section below headed Summary of provisions relating to Bonds whilst in global form. 1

2 Neither the Issuer nor the Bonds are rated with Standard & Poor s rating services or any other rating service. THE BONDS ARE OBLIGATIONS SOLELY OF THE ISSUER AND ARE NOT GUARANTEED BY, OR BE THE RESPONSIBILITY OF, ANY OTHER ENTITY. The attention of potential investors is drawn to the sections headed "Investor Suitability" and "Investment Considerations and Risk Factors" on pages 7 and 8 of the Base Prospectus. The date of this Series Prospectus is 12 September

3 No person has been authorised to give any information or to make any representation other than those contained in this Series Prospectus and/or in the Base Prospectus in connection with the issue or sale of the Bonds and, if given or made, such information or representation must not be relied upon as having been authorised by the Issuer or the Arranger (as defined in "Summary of the Programme"). The distribution of this Series Prospectus and the offering or sale of the Bonds in certain jurisdictions may be restricted by law. Persons into whose possession this Series Prospectus comes are required by the Issuer and the Arranger to inform themselves about and to observe any such restriction. The Bonds have not been and will not be registered under the U.S. Securities Act of 1933 as amended (the "Securities Act") and may include Bonds in registered form that are subject to U.S. tax law requirements. The Issuer has not registered and will not register under the U.S. Investment Company Act of 1940, as amended (the "Investment Company Act"). Consequently, the Bonds may not be offered, sold, resold, delivered or transferred within the United States or to, or for, the account or benefit of U.S. persons (as such term is defined in Regulation S under the Securities Act) except in accordance with the Securities Act or an exemption therefrom and under circumstances which will not require the Issuer to register under the Investment Company Act. For a description of certain restrictions on offers and sales of Bonds and on distribution of this Series Prospectus, see "Subscription and Sale and Transfer Restrictions on pages 59 to 61 (inclusive) of the Base Prospectus.. For so long as the Programme remains in effect or any Bonds (whether of this series or any other issued pursuant to the Programme) remain outstanding, in the event that there are (i) any changes in the Terms and Conditions of the Bonds, (ii) a material adverse change in the financial situation of the Issuer or (iii) the addition of a new issuer in relation to the Programme, the Issuer shall publish a supplemental Base Prospectus or a Series Prospectus setting out the details of such changes or additions, as the case may be. This Series Prospectus does not constitute an invitation to the public within the meaning of the Irish Companies Acts 1963 to 2006 to subscribe for any Bonds. Neither the Arranger nor the Bond Registrar has separately verified the information contained herein and accordingly neither the Arranger nor the Bond Registrar makes any representation, recommendation or warranty, express or implied, regarding the accuracy, adequacy, reasonableness or completeness of the information contained herein or in any further information, notice or other document which may at any time be supplied in connection with the Bonds or their distribution and none of them accepts any responsibility or liability therefor. Neither the Arranger nor the Bond Registrar undertakes to review the financial condition or affairs of the Issuer during the life of the arrangements contemplated by the Base Prospectus nor to advise any investor or potential investor in the Bonds of any information coming to the attention of either the Arranger or the Bond Registrar. TO NEW HAMPSHIRE RESIDENTS: NEITHER THE FACT THAT A REGISTRATION STATEMENT NOR AN APPLICATION FOR A LICENCE HAS BEEN FILED UNDER RSA 421-B WITH THE STATE OF NEW HAMPSHIRE OR THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS 3

4 LICENSED IN THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW HAMPSHIRE THAT ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO, ANY PERSONS, SECURITY OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR TO CAUSE TO BE MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT ANY REPRESENTATION INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH. In this Series Prospectus, unless otherwise specified or the context otherwise requires, references to "dollars", "U.S. dollars", "USD" and "U.S.$" are to United States dollars, references to "euro", "EUR" or " " are to the lawful currency of the member states of the European Union that have adopted the single currency in accordance with the Treaty establishing the European Community as amended by the Treaty of European Union as amended by the Treaty of Amsterdam and references to pounds, sterling, or GBP are references to the lawful currency of the United Kingdom of Great Britain and Northern Ireland. 4

5 TABLE OF CONTENTS Page INVESTMENT CONSIDERATIONS AND RISK FACTORS... 6 THE BONDS... 6 SUMMARY OF THE TERMS OF ISSUE... 8 TERMS & CONDITIONS OF THE BONDS SUMMARY OF PROVISIONS RELATING TO BONDS WHILST IN GLOBAL FORM.12 GENERAL INFORMATION

6 INVESTMENT CONSIDERATIONS AND RISK FACTORS Prospective investors should determine whether an investment in the Issuer is appropriate in their particular circumstances and should consult with their legal, business and tax advisers to determine the consequences of an investment in any Bonds and to arrive at their own evaluation of the investment. Attention is drawn, in particular, to the section headed "Investment Considerations and Risk Factors" on pages 8 to 21 (inclusive) of the Base Prospectus. The Issuer is not aware of any additional considerations or risk factors which prospective investors should take into account nor of any alterations which ought to be made to the investment considerations or risk factors listed in the Base Prospectus. Nature of Bonds THE BONDS All tranches of the Bonds have been issued on the dates set out below. All Bonds have identical terms save as to issue and maturity dates. Security type - Asset-backed capital growth bond Currency of Issue - GBP Dates of Issue - Tranche 1-1 st April ,000 Tranche 2 1 st July ,500,000 Tranche 3 1 st October 2008 up to 5,000,000 Tranche 4 1 st January 2009 up to 5,000,000 Maturity Dates - Tranche 1-31 st March 2015 Tranche 2 30 th June 2015 Tranche 3 30 th September 2015 Tranche 4 31 st December 2015 Return on Capital - 100% over the lifetime of the bond Minimum Subscription: - GBP 50,000 Common Codes - Tranche Tranche

7 Tranche Tranche ISINs - Tranche 1 - XS Tranche 2 - XS Tranche 3 - XS Tranche 4 - XS The Bonds do not constitute direct or indirect obligations of the Arranger or the Service Providers, or of any affiliate of any of them. Underlying Assets and Use of Proceeds The net proceeds of the issue of all the tranches shown were upto GBP 11,845,0000 when expenses of the issue of GBP5,000 are deducted from the proceeds of the issue. The proceeds of each tranche were transferred to the US Trust within thirty business days of the closing of the issue of each tranche. Each tranche closed seven days before the issue date of each tranche. The US Trust has informed the Fiduciary of the amount received. The Issuer has instructed the Provider to use the funds to purchase SLS which meet the eligibility criteria on the terms set out on page 26 of the Base Prospectus. The assets which will underlie the Bonds will be the cash which derives from the SLS which will be held in the Cash Entitlement Account, into which the proceeds of any maturing SLS will be transferred. The Provider will purchase the SLS within eight weeks of the receipt of funds from the Issuer upon the terms set out on page 27 of the Base Prospectus. The SLS so acquired must comply with the criteria set out on page 26 of the Base Prospectus. In order to monitor and maintain the sufficiency of the underlying assets within the pool of SLS acquired by the Provider on behalf of the Issuer, the Adviser will issue six monthly reports to the Bondholders confirming that the Issuer has the Required Asset Cover to meet its obligations to Bondholders at any given time. Further details of the method by which the level of assets are monitored and maintained are set out on pages 22 and 23 of the Base Prospectus. As each new series of bonds is issued, additional SLS will be purchased as security for such further bonds. However, the assets of the Issuer will all be pooled such that bonds in each series issued pursuant to the programme described in the Base Prospectus will all be serviced from a single pool of assets. The underlying assets will be available to Bondholders in the order in which the bonds mature, unless there is an Event of Default (as defined on page 42 of the Base Prospectus), in which case the underlying assets will be available to bondholders in the order in which each series was issued. Save for the semi-annual certificate of compliance to be issued to Bondholders pursuant to condition 17.4 of the terms and conditions of the Bonds contained in the Base Prospectus ( the Terms ), the Issuer does not intend to provide any post-issuance transaction information in relation to the Bonds. 7

8 SLS by their nature do not have (except in limited circumstances) specific maturity dates which depend on the death of the policyholders. SUMMARY OF THE TERMS OF ISSUE The following summary does not purport to be complete and is taken from, and is qualified in its entirety by, the remainder of this Series Prospectus and by the Base Prospectus. Issuer: ARM Asset-Backed Securities S.A., a sociéte anonyme incorporated on 4 November 2005 and existing and organised under the laws of the Grand Duchy of Luxembourg, and being a securitisation vehicle under the Luxembourg law of 22nd March 2004, under registered number B104219, managed by Equity Trust Co. (Luxembourg) S.A. Description of the Bonds: Up to GBP 11,850,000 Asset-Backed Income Bond Series R 2015 Account Bank: ING Bank (Netherlands) NV Custodian: ING Luxembourg S.A. Paying Agent: ING Luxembourg S.A. Payment Administrator: Equity Trust Co. (Luxembourg) S.A. Calculation Agent: Equity Trust Co. (Luxembourg) S.A. Bond Registrar: Equity Trust Co. (Luxembourg) S.A. Dissemination Agent: LaSalle Bank National Association Arranger: Catalyst Investment Group Limited. US Trustee: LaSalle National Trust, Delaware 8

9 Asset Custodian: LaSalle National Association Providers include: Life Settlements International, LLC Irish Paying Agent: AIB International Financial Services Limited Currency: GBP Maturity: 31 st March 2015, 30 th June 2015, 30 th September 2015 and 31 st December 2015 as set out above Issue Date: 1 st April 2008, 1 st July 2008, 1 st October 2008 and 1 st January 2009 as set out above Issue Price: 100% Interest: 100% yield at maturity of the bond. No interest is paid during the lifetime of the bond Type of Security: Asset Backed Capital Growth Bond Form of Bonds: Registered Denomination: GBP 50,000 Early Redemption: Bonds will be redeemable prior to maturity only in limited circumstances upon the occurrence of certain events relating to the Issuer as set out in Condition 11 (Redemption) of the Terms or relating to an acceleration of the Bonds as specified in Condition 13 (Events of Default) of the Terms. Taxation: Return of capital invested will be paid gross of tax. Listing: The ARM Asset Backed Securitisation Programme is listed on the Irish Stock Exchange. Application has been made for the Bonds to be listed on the Official List of the Irish Stock Exchange. Status of Bonds: Bonds of each Series will rank pari passu and without preference among themselves. 9

10 Borrowing: The Issuer is entitled to borrow on a secured, limited recourse and senior basis up to one times the death benefit value of the SLS, such borrowing to be effected by the issue of Bonds within the meaning of the Luxembourg law of 22nd March 2004 on securitisation ranking senior to the Bonds, in order to purchase additional SLS or to create liquidity in order to make payments in accordance with the Terms and Conditions. Underlying Assets: The Underlying Assets will comprise cash, cash equivalent and cash flows from the pool of SLS, and will be held in the Cash Entitlement Account. US Trust: The pool of SLS will be held in trust with the US Trustee as trustee. Trust Agreement: The Issuer, the Fiduciary and the US Trust have established a Trust Agreement and Declaration of Trust for the purpose of providing for the reporting by the US Trust to the Fiduciary in satisfaction of the rights and obligations the Fiduciary and, as a consequence, managing the payment of the proceeds of matured Policies from the US Trust to the Issuer. Expenses: The Payment Administrator, on behalf of the Issuer, is authorised to make deductions from the proceeds of the issue, as set out in condition 8 of the Terms. The Payment Administrator shall have the power to deduct, as agreed by the Issuer or the Arranger, its own fees and those fees relating to the Arranger, the Issuer, the Custodian, the Bond Registrar, the US Trustee, the Fiduciary, the Securities Intermediary, the Asset Custodian, the Irish Paying Agent, the Auditor, the Provider, the domiciliation agent and any other service providers agreed by the Issuer and the Arranger ("Service Providers"), together with the incorporation costs of the Issuer and all properly incurred and related legal and actuarial and other professional fees and expenses incurred by a Service Provider, from the proceeds of the issue. A Service Provider may include placement agents, brokers and other organisations paid introductory and other fees relating to capital raising. Further Issues Further Bonds may be issued in this series. Upon the issue of such further Bonds, the Issuer will procure the acquisition of further 10

11 underlying assets in the manner described above in the section headed Assets Backing the Bonds. Governing Law: The Bonds will be governed by, and construed in accordance with, Luxembourg law. 11

12 TERMS & CONDITIONS OF THE BONDS Save as varied above under Summary of the Terms of the Issue, the Terms and Conditions of the Bonds are as set out on pages 34 to 48 (inclusive) of the Base Prospectus. SUMMARY OF PROVISIONS RELATING TO THE BONDS WHILST IN GLOBAL FORM Under the terms of an agreement dated 6 December 2007, ING Luxembourg S.A. ( ING ) have agreed to act as Custodian and Paying Agent on behalf of the Issuer in relation to Bonds issued as temporary or permanent Global Notes. For the purposes of the Base Prospectus, ING shall be treated as a Service Provider and the Payment Administrator shall be authorised to deduct fees due to ING from subscriptions for Bonds. Temporary or permanent global notes will be issued by the Bond Registrar and be delivered by them to the common depositary. Thereafter, the Custodian will ensure that Notes are assigned security numbers in respect of each tranche of this Series. The Custodian shall also determine exchange dates for temporary global notes and shall, on that date, deliver the temporary note to the Bond Registrar in exchange for a permanent global note prepared by the Bond Registrar. The permanent global note shall then be deposited by the Custodian with the common depositary. After receipt of funds from the Issuer, the Paying Agent shall be responsible for making all payments due to be made by the Issuer in accordance with the terms of the Bonds as calculated by the Calculation Agent. The Paying Agent s and the Custodian s appointments can be terminated by the Issuer on 45 days notice and by the Paying Agent or Custodian on 90 days notice. Such terminations shall not take effect until the appointment of a new Paying Agent and Custodian which, in each case, has a presence in a member state of the European Union. GENERAL INFORMATION (1) The Issuer has obtained all necessary consents, approvals and authorisations (if any) which are necessary at the date of the Base Prospectus in connection with the issue and performance of the Bonds. The establishment of the Programme and the issue of the Base Prospectus were authorised by resolutions of the Board of Directors of the Issuer passed on 2 August 2007 and 5 September 2008 respectively. The issue of this Series Prospectus was approved by a resolution of the Board of Directors passed on 5 September

13 (2) Since the date of incorporation, the Issuer has not been involved, and is not involved, in any government, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the Issuer is aware) which may have, or have had since it since its incorporation, a significant effect on the Issuer s financial position. (3) Each Registered Note will bear the following legend: "Any United States person who holds this obligation will be subject to limitations under the United States income tax laws, including the limitations provided in Sections 165(j) and 1287(a) of the Internal Revenue Code of 1986, as amended". (4) Bonds have been accepted for clearance through the Euroclear and Clearstream, Luxembourg systems. The Common Code and International Securities Identification Number (ISIN) numbers for the Bonds are set out in the section headed Assets Backing the Bonds above. (5) Copies of the following documents may be inspected in physical or electronic form (and in the case of (i) to ( vi ) below, will be available for collection free of charge) at the specified offices of the Irish Paying Agent and the Payment Administrator and at the registered offices of the Issuer during normal business hours on any weekday (Saturdays, Sundays and public holidays excepted) for the term of the Bonds: (i) the Memorandum and Articles of Association of the Issuer; (ii) the US Trust Agreement; (iii) the Base Prospectus; (iv) this Series Prospectus; (v) the Agency Agreement relating to each issue of Bonds and each document incorporated by reference into such Agency Agreement; (vi) the Agency Agreement between the Issuer, ING, the Bond Registrar and the Arranger; (vii) all reports, letters and other documents, balance sheets, valuations and statements by any expert any part of which is included or referred to in the Prospectus; (viii) the audited accounts of the Issuer for the periods ended 30 June 2006 and 30 June 2007; and (ix) such other documents (if any) as may be required by the rules of any stock exchange on which any Bond is at the relevant time listed. 13

14 (6) The Issuer is a company incorporated under the laws of Luxembourg. No Director of the Issuer is a resident of the United States, and all or a substantial portion of the assets of the Issuer and such persons are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon the Issuer or such persons or to enforce against any of them in the United States courts judgments obtained in the United States courts predicated upon the civil liability provisions of the federal securities laws of the United States. (7) So long as any of the Bonds are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, the Issuer will, unless it becomes subject to and complies with the reporting requirements of Section 13 or 15(d) of the Exchange Act or the information furnishing requirements of Rule 12g3-2(b) thereunder, provide to any holder or beneficial owner of Bonds that are restricted securities, or to any prospective purchaser of Bonds that are restricted securities designated by a holder or beneficial owner, upon the request of such holder, beneficial owner or prospective purchaser, the information required to be provided by Rule 144A(d)(4) under the Securities Act. (8) Since 30 June 2007, the date of the last audited financial statements, there has been no material adverse change in the financial position or prospects of the Issuer. (9) The 2007 audited accounts are incorporated by reference (10) The estimate of the total expenses related to the admission to trading of the Bonds is GBP 5,

15 REGISTERED OFFICE OF THE ISSUER 46A Avenue J.F. Kennedy L-1855 Luxembourg ARRANGER Catalyst Investment Group Limited 4 Lombard Street London EC3V 9HD PAYMENT ADMINISTRATOR AND BOND REGISTRAR Equity Trust Fund Services (Luxembourg) S.A. 46A Avenue J.F. Kennedy L-1855 Luxembourg BANK, CUSTODIAN AND PAYING AGENT ING Luxembourg S.A. 52, Route d Esch L-2965 Luxembourg IRISH PAYING AGENT AIB International Financial Services Ltd. AIB International Centre, I.F.S.C. Dublin 1 PROVIDERS INCLUDE Life Settlements International, LLC 110 East 59th Street 6th Floor New York, NY US TRUSTEE LaSalle National Trust Delaware 1201 North Orange Street Suite 1000 Wilmington Delaware DE USA 15

16 US ASSET CUSTODIAN AND DISSEMINATION AGENT LaSalle Bank National Association 135 South LaSalle Street Suite 1560 Chicago, IL AUDITORS PricewaterhouseCoopers Société à responsabilité limitée Réviseur d Entreprises 400, Route d Esch B.P L-1014 Luxembourg LISTING AGENTS Goodbody Stockbrokers Ballsbridge Park, Ballsbridge, Dublin 4, Ireland LEGAL ADVISERS To the Issuer as to US law and tax: Lord Bissell Brook LLP 885 Third Avenue, 26th Floor New York, NY To the Issuer as to English law: Stephenson Harwood One, St Paul s Churchyard London EC4M 8SH To the Issuer as to Irish law: Matheson Ormsby Prentice 70 Sir John Rogerson s Quay Dublin 2 Ireland 16