SUPLEMENT TO THE IM FTPYME SABADELL 7 FONDO DE TITULIZACIÓN DE ACTIVOS PROSPECTUS REGISTERED IN THE OFFICIAL REGISTERS OF THE CNMV ON SEPTEMBER 19, 2008 This Supplement to the Prospectus approved by the Comisión Nacional del Mercado de Valores (hereon, CNMV) in accordance with the European Commission s Rule 809/2004 and registered in the official registers of the CNMV on September 19, 2008, is the direct result of the current situation of the capital markets and in order to modify the following sections of the Prospectus. José Antonio Trujillo del Valle, ID number 260331-V, acting in virtue of the meeting of the Board of Directors of Intermoney S.G.F.T, S.A., entity promoting the Fondo, on July 17, 2008, assumes, in representation of Intermoney S.G.F.T, S.A., with its registered address in Madrid, Torre Picasso, 23 rd floor, 28020 Madrid and with Tax Code A-83774885, the responsibility for this Prospectus and declares, having followed due diligence to guarantee it, that the information contained in this Supplement is, to his knowledge, in accordance to fact and that it does not incur in any omission that may affect its contents. This Supplement is a supplement of the Prospectus, in accordance with article 22 of Real Decreto 1310/2005, that partially develops Ley 24/1988, the Securities Market Act, in relation with securities traded in secondary markets, and must be read jointly with such Prospectus and any other supplement to the Prospectus that is published or that might be published in the future. 1
In accordance with the above, we therefore notify that the entities BBVA, S.A and Société Générale, S. A., Underwriters and Placement Agents of Series A2 (G), will now only take part as placement agents of Series A2 (G) and will not, under any circumstance, carry out any underwriting in relation with the Bonds of such Series A2 (G) and, therefore, it is agreed that the following sections in the Prospectus will be modified: 1) Front page Where it states: Underwriters and Placement Agents for Series A2 (G) SOCIÉTÉ GÉNÉRALE, S.A. BBVA, S.A. It should state: Placement Agents for Series A2 (G) SOCIÉTÉ GÉNÉRALE, S.A. BBVA, S.A. Furthermore, where it states: Subscriber of Series A1, B and C BANCO DE SABADELL, S.A. It should state: Subscriber of Series A1, B and C and Underwriter of Series A2 (G) BANCO DE SABADELL, S.A. 2
2) Risk Factors Section 2.1 (Liquidity) Where it states: The Seller, as Subscriber, has undertaken to subscribe in its entirety the Bonds of Series A1, B and C. Series A2 (G) Bonds will be placed and underwritten by the Underwriters and Placement Agents of Series A2 (G). It should state: The Seller, as Subscriber, has undertaken to subscribe in its entirety the Bonds of Series A1, B and C. Series A2 (G) Bonds will be placed by the Placement Agents of Series A2 (G) and underwritten by the Underwriter of Series A2 (G). 3) Registration Document. Section 5.1 (Main activity) Where it states: The activity of the Fondo consists of the acquisition of a group of Credit Rights held by the Seller, and granted to non-financial companies (companies or individual business persons), described in section 2.2.2 of the Additional Building Block of this Prospectus, and the issue of securitised bonds destined to finance the purchase of such Credit Rights. Banco de Sabadell will subscribe 100% of the A1, B and C Series of Bonds. Société Générale, S.A. and BBVA, S.A. will underwrite Series A2 (G). It should state: The activity of the Fondo consists of the acquisition of a group of Credit Rights held by the Seller, and granted to non-financial companies (companies or individual business persons), described in section 2.2.2 of the Additional Building Block of this Prospectus, and the issue of securitised bonds destined to 3
finance the purchase of such Credit Rights. Banco de Sabadell will subscribe 100% of the A1, B and C Series of Bonds. Banco de Sabadell, S.A. will underwrite Series A2 (G). Section 5.2 (General Description of the participants in the securitisation) Where it states: BANCO DE SABADELL, S.A., acts as Seller of the Credit Rights, Payment Agent and counterparty of the Fondo in the Payment Agent Agreement. Banco de Sabadell, S.A. will also act as Lead Manager and Subscriber of the A1, B and C Bonds, assuming the roles included in article 35.1 of Real Decreto 1310/2005. Banco de Sabadell, S.A. also acts as counterparty of the agreements for the Loan for Initial Expenses, the Loan for First Period Interest, the Management Agreement, the Loan for the Reserve Fund and the Financial Swap. Banco de Sabadell, S.A., is a bank incorporated in Spain and registered in the Registro Especial de Bancos y Banqueros del Banco de España (Bank of Spain s Special Register for Banks and Bankers) with number 0081. It has been registered in the Registro Mercantil (Companies House) of Barcelona, volume 20,093, sheet 1, page B-1561, inscription 580. It should state: BANCO DE SABADELL, S.A., acts as Seller of the Credit Rights, Payment Agent and counterparty of the Fondo in the Payment Agent Agreement. Banco de Sabadell, S.A. will also act as Lead Manager and Subscriber of the A1, B and C Bonds, assuming the roles included in article 35.1 of Real Decreto 1310/2005, and Underwriter of the A2 (G) Series. Banco de Sabadell, S.A. also acts as counterparty of the agreements for the Loan for Initial Expenses, the Loan for First Period Interest, the Management Agreement, the Loan for the Reserve Fund and the Financial Swap. Banco de Sabadell, S.A., is a bank incorporated in Spain and registered in the Registro Especial de Bancos y Banqueros del Banco de España (Bank of Spain s Special Register for Banks and Bankers) with number 0081. It has been 4
registered in the Registro Mercantil (Companies House) of Barcelona, volume 20,093, sheet 1, page B-1561, inscription 580. Where it states: SOCIÉTÉ GÉNÉRALE, S.A., is the Underwriter and Placement Agent of the A2 (G) Bonds and also acts Lead Manager. Société Générale, S.A., is a credit entity registered in the Registro Mercantil (Companies House) of Madrid, volume 10,205, sheet 35, page 18,909, inscription 480. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 0108 as a foreign credit entity from the European Union. It should state: SOCIÉTÉ GÉNÉRALE, S.A., is the Placement Agent of the A2 (G) Bonds and also acts Lead Manager. Société Générale, S.A., is a credit entity registered in the Registro Mercantil (Companies House) of Madrid, volume 10,205, sheet 35, page 18,909, inscription 480. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 0108 as a foreign credit entity from the European Union. Where it states: Banco Bilbao Vizcaya Argentaria, S.A. (BBVA, S.A.), is the Underwriter and Placement Agent of the A2 (G) Bonds. BBVA, S.A. is a credit entity registered in the Registro Mercantil (Companies House) of Vizcaya, in inscriptions 1 and 156, Volumes 2,083 and 2,227, Section 3, Sheets 183 and 49, page BI-17 and inscription 1035. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 3, and code 0182. It should state: Banco Bilbao Vizcaya Argentaria, S.A. (BBVA, S.A.), is the Placement Agent of the A2 (G) Bonds. BBVA, S.A. is a credit entity registered in the 5
Registro Mercantil (Companies House) of Vizcaya, in inscriptions 1 and 156, Volumes 2,083 and 2,227, Section 3, Sheets 183 and 49, page BI-17 and inscription 1035. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 3, and code 0182. 4) Securities Note. Section 3.1 (Interest of the individuals and legal entities taking part in the offer) Where it states: Banco de Sabadell, S.A. acts as (i) Seller of the Credit Rights, (ii) creditor of the Loan for Initial Expenses, the Loan for the Reserve Fund and the Loan for First Period Interest, (iii) counterparty of the Financial Swap Agreement, (iv) Payment Agent and custodian of the Bond issue, (v) Servicer of the Credit Rights sold to the Fondo, and (vi) Lead Manager and Subscriber of the Bonds of Series A1, B and C. Société Générale, S.A., acts as Lead Manager and Underwriter and Placement Agent of Series A2 (G). BBVA, S.A. acts as Underwriter and Placement Agent of Series A2 (G). It should state: Banco de Sabadell, S.A. acts as (i) Seller of the Credit Rights, (ii) creditor of the Loan for Initial Expenses, the Loan for the Reserve Fund and the Loan for First Period Interest, (iii) counterparty of the Financial Swap Agreement, (iv) Payment Agent and custodian of the Bond issue, (v) Servicer of the Credit Rights sold to the Fondo, and (vi) Lead Manager and Subscriber of the Bonds of Series A1, B and C, and Underwriter of the A2 (G) Series of Bonds. 6
Société Générale, S.A., acts as Lead Manager and Placement Agent of Series A2 (G). BBVA, S.A. acts as Placement Agent of Series A2 (G). Section 4.1 (Total value of the securities) Where it states: Underwriting of the Issue. Société Générale, S.A. and BBVA, S.A. will place and subscribe the Bonds of Series A2 (G), as Underwriters and Placement Agents of Series A2 (G), in accordance with the Management, Subscription, Underwriting and Placement Agreement for the Bond Issue that the Sociedad Gestora will arrange on behalf of the Fondo. In return, Société Générale, S.A. and BBVA, S.A. will receive an underwriting and placement commission, included in the initial expenses of the Fondo. Banco de Sabadell, S.A., will underwrite 100% of the issue of the A1, B and C Bonds. Banco de Sabadell, S.A. will not receive any commission. The price of issue will be 100%. It should state: Underwriting of the Issue. Société Générale, S.A. and BBVA, S.A. will place the Bonds of Series A2 (G), as Placement Agents of Series A2 (G), and the underwriting of the subscription will be carried out by Banco de Sabadell, S.A., as Underwriter of Series A2 (G), in accordance with the Management, Subscription, Underwriting and Placement Agreement for the Bond Issue that the Sociedad Gestora will arrange on behalf of the Fondo. In return, Société Générale, S.A. and BBVA, S.A. will receive a placement commission, included in the initial expenses of the Fondo. 7
Banco de Sabadell, S.A., will subscribe 100% of the issue of the A1, B and C Bonds, entity that will also underwrite Series A2 (G). Banco de Sabadell, S.A. will not receive any commission as Subscriber of Series A1, B and C and Underwriter of Series A2 (G). The price of issue will be 100%. Section 4.13.3 (Where to direct the subscription). Where it states: Subscription petitions for Series A2 (G) must be presented during the Subscription Period through the Underwriters and Placement Agents of Series A2 (G), in accordance with the procedure established in the following sections. It should state: Subscription petitions for Series A2 (G) must be presented during the Subscription Period through the Placement Agents of Series A2 (G), in accordance with the procedure established in the following sections Section 4.13.4 (Closing Date) Where it states: On the Closing Date, the Underwriters and Placement Agents of Series A2 (G) will pay the amount underwritten into the account opened in the name of the Fondo at the Payment Agent, value that day, before 10.15 am, CET time. On the Closing Date the Seller will pay into the Treasury Amount the amounts it has subscribed and that correspond to the A1, B and C Series of Bonds. Investors that have been allotted A2 (G) Bonds must pay the Underwriters and Placement Agents of Series A2 (G), prior to 10 am, CET time, on the Closing Date, value that day, the price of issue for each allotted Bond. 8
It should state: On the Closing Date, the Placement Agents of Series A2 (G) and the Underwriter of Series A2 (G) will pay the amount each has placed and underwritten into the account opened in the name of the Fondo at the Payment Agent, value that day, before 10.15 am, CET time. On the Closing Date the Seller will pay into the Treasury Amount the amounts it has subscribed and that correspond to the A1, B and C Series of Bonds. Investors that have been allotted A2 (G) Bonds must pay the Placement Agents of Series A2 (G), prior to 10 am, CET time, on the Closing Date, value that day, the price of issue for each allotted Bond. Section 4.13.5 (Delivery of the Subscription documents) Where it states: Subscribers of the A2 (G) Series of Bonds may request a title document from the Subscribers and Placement Agents of Series A2 (G), despite Bond ownership being credited through accounting register of the Bonds, as they are represented as book entries. It should state: Subscribers of the A2 (G) Series of Bonds may request a title document from the Placement Agents of Series A2 (G), despite Bond ownership being credited through accounting register of the Bonds, as they are represented as book entries. Section 5.2. (Payment Agent. Name and address of any payment agent and the custody agents in each country) Where it states: 9
The Payment Agent s obligations, included in such Agreement, are summarised as follows: (i) (ii) On the Closing Date, to pay the Fondo before 11 am (CET), by transfer to the Treasury Account, value that day, the total amount of the subscription of the Bond Issue subscribed that, in accordance with the Management, Subscription, Underwriting and Placement Agreement of the Bond Issue, is paid by the Underwriters and Placement Agents of the Series A2 (G) plus 100% of the principal amount of the Bonds of Series A1, B and C, subscribed by Banco de Sabadell, S.A. On each Payment Date of the Bonds, pay the Underwriters and Placement Agents of the Series A2 (G) the amount of the underwriting and placement commission accrued in its favour, once the Underwriters have paid the principal of the Bonds underwritten and, if applicable, subscribed to the extent of their underwriting agreement. It should state: The Payment Agent s obligations, included in such Agreement, are summarised as follows: (iii) On the Closing Date, to pay the Fondo before 11 am (CET), by transfer to the Treasury Account, value that day, the total amount of the subscription of the Bond Issue subscribed that, in accordance with the Management, Subscription, Underwriting and Placement Agreement of the Bond Issue, is paid by the Placement Agents of the Series A2 (G) plus 100% of the principal amount of the Bonds of Series A1, B and C, subscribed by Banco de Sabadell, S.A., and the amount finally underwritten by Banco de Sabadell, S.A. of the Series A2 (G). 10
(iv) On the Closing Date, pay the Placement Agents of the Series A2 (G) the amount of the placement commission accrued in its favour, once the former has paid the principal of the Bonds placed. 5) Additional Building Block Section 3.4.4.1 (Treasury Account) Where it states: (i) Effective amount, net of underwriting and placement commissions, from the disbursement of the A2 (G) Bonds and the subscription of the Bonds of Series A1, B and C. It should state: (i) Effective amount, net of commissions, from the disbursement of the A2 (G) Bonds and the subscription of the Bonds of Series A1, B and C. 6) Definitions: In the definition of the Management, Subscription, Underwriting and Placement Agreement Where it states: Agreement signed between the Sociedad Gestora, on behalf of the Fondo, and Banco de Sabadell, S.A., and Société Générale, S.A. as Lead Managers and Société Générale, S.A. and BBVA, S.A. as Underwriters and Placement Agents of the A2 (G) Series of Bonds, and Banco de Sabadell, S.A. as subscriber of the A1, B and C Bonds, on September 22, 2008. 11
It should state: Agreement signed between the Sociedad Gestora, on behalf of the Fondo, and Banco de Sabadell, S.A., and Société Générale, S.A. as Lead Managers and Société Générale, S.A. and BBVA, S.A. as Placement Agents of the A2 (G) Series of Bonds, and Banco de Sabadell, S.A. as subscriber of the A1, B and C Bonds and Underwriter of Series A2 (G), on September 22, 2008. In the definition of Underwriters and Placement Agents of Series A2 (G) Where it states: Underwriters and Placement Agents of Series A2 (G) It should state: Placement Agents of Series A2 (G) Furthermore, we include the definition of Underwriter of Series A2 (G) as follows: Underwriter of Series A2 (G): Banco de Sabadell, S.A. In Madrid, on September 22, 2008 José Antonio Trujillo del Valle INTERMONEY TITULIZACIÓN, S.G.F.T, S.A. 12
Prospectus September 2008 IM FTPYME SABADELL 7 FONDO DE TITULIZACION DE ACTIVOS ASSET BACKED SECURITIES 1,000,000,000 SERIES AMOUNT S&P Series A1 497.500.000 AAA Series A2 (G) * 402.500.000 AAA Series B 65.000.000 A Series C 35.000.000 BB- * Series A2 (G) backed by a grant from the Spanish State. Backed by Credit Rights derived from PYMEs Financing Operations sold and serviced by BANCO DE SABADELL, S.A. Lead Managers BANCO DE SABADELL, S.A. SOCIÉTÉ GÉNÉRALE, S.A. Underwriters and Placement Agents for Series A2 (G) SOCIÉTÉ GÉNÉRALE, S.A. BBVA, S.A. Subscriber of Series A1, B and C BANCO DE SABADELL, S.A. Payment Agent BANCO DE SABADELL, S.A. Fondo designed, arranged and managed by This document is a translation of the Spanish Prospectus registered at the CNMV. This document is not a securities offer or other document with any legal effect. No other document but the final Prospectus registered at the CNMV may be considered as having any legal effect.
INDEX RISK FACTORS 1 1 RISKS DERIVED FROM THE LEGAL NATURE AND THE ACTIVITY OF THE ISSUER._ 1 1.1 NATURE OF THE FONDO AND LIABILITIES OF THE SOCIEDAD GESTORA (MANAGEMENT COMPANY). 1 1.2 FORCED SUBSTITUTION OF THE SOCIEDAD GESTORA. 1 1.3 LIMITATION OF ACTIONS AGAINST THE SOCIEDAD GESTORA. 1 1.4 APPLICATION OF THE BANKRUPTCY ACT. 1 2 RISKS DERIVED FROM THE SECURITIES. 3 2.1 LIQUIDITY. 3 2.2 YIELD. 3 2.3 TERM. 3 2.4 PENALTY INTEREST. 3 3 RISKS DERIVED FROM THE ASSETS BACKING THE ISSUE. 3 3.1 RISK LINKED TO THE FIELD OF ACTIVITY. 4 3.2 RISK OF DEFAULT OF THE CREDIT RIGHTS. 4 3.3 RISK OF EARLY AMORTISATION OF THE CREDIT RIGHTS. 4 3.4 LIMITED HEDGING. 5 3.5 LIMITED RESPONSIBILITY. 5 3.6 YEAR OF ISSUE CONCENTRATION. 5 3.7 INTEREST TYPE RISK. 5 3.8 RISK OF DEBTOR CONCENTRATION. 5 REGISTRATION DOCUMENT FOR SECURITIES (ANNEX VII OF THE CE 809/2004 REGULATIONS) 6 1 INDIVIDUALS RESPONSIBLE. 6 1.1 INDIVIDUALS RESPONSIBLE FOR THE INFORMATION GIVEN IN THE REGISTRATION DOCUMENT. 6 1.2 DECLARATION BY THOSE RESPONSIBLE FOR THE CONTENTS OF THE REGISTRATION DOCUMENT. 6 2 ACCOUNTING AUDITORS. 6 2.1 AUDITORS OF THE FONDO. 6 2.2 ACCOUNTING CRITERIA USED BY THE FONDO. 6
3 RISK FACTORS. 7 4 INFORMATION ABOUT THE ISSUER. 7 4.1 DECLARATION OF THE ESTABLISHMENT OF THE ISSUER AS FONDO DE TITULIZACIÓN. 7 4.2 NAME OF THE ISSUER. 7 4.3 PLACE OF REGISTRATION OF THE ISSUER AND ITS REGISTRATION NUMBER. 7 4.4 DATE OF INCORPORATION AND PERIOD OF ACTIVITY OF THE ISSUER. 7 4.5 ADDRESS, LEGAL TITLE AND LEGISLATION APPLICABLE TO THE ISSUER. 11 4.6 ISSUER S AUTHORISED AND ISSUED CAPITAL. 13 5 DESCRIPTION OF THE FONDO DE TITULIZACIÓN. 13 5.1 MAIN ACTIVITY. 13 5.2 GENERAL DESCRIPTION OF THE PARTICIPANTS IN THE SECURITISATION. 13 6 ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES. 16 6.1 INCORPORATION AND INSCRIPTION IN THE REGISTRO MERCANTIL (COMPANIES HOUSE). 16 6.2 ACCOUNT AUDITING. 16 6.3 CORPORATE PURPOSE. 16 6.4 SHARE CAPITAL. 18 6.5 SHAREHOLDINGS IN OTHER COMPANIES. 18 6.6 ADMINISTRATIVE, MANAGEMENT AND SUPERVISION BODIES. 18 6.7 MAIN ACTIVITIES OF THE INDIVIDUALS MENTIONED IN SECTION 6.6, CARRIED OUT OUTSIDE THE SOCIEDAD GESTORA IF RELEVANT TO THE FONDO. 19 6.8 CREDITORS OF THE SOCIEDAD GESTORA IN MORE THAN 10%. 19 6.9 LAWSUITS OF THE SOCIEDAD GESTORA. 19 6.10 SUPERVISORY BODIES. 19 7 MAYOR SHAREHOLDERS 19 7.1 DECLARATION REGARDING THE DIRECT OR INDIRECT OWNERSHIP OF THE SOCIEDAD GESTORA OR WHETHER IT IS CONTROLLED. 19 8 FINANCIAL INFORMATION CONCERNING THE ISSUER S ASSETS AND LIABILITIES, FINANCIAL POSITION AND PROFITS AND LOSSES. 20 8.1 DECLARATION REGARDING THE INITIATION OF TRADING AND FINANCIAL STATEMENTS OF THE ISSUER PRIOR TO THE DATE OF THE REGISTRATION DOCUMENT. 20 8.2 HISTORICAL FINANCIAL INFORMATION REQUIRED WHEN AN ISSUER HAS INITIATED TRADING AND FINANCIAL STATEMENTS HAVE BEEN GENERATED. 20
8.3 LEGAL AND ARBITRATION PROCEEDINGS. 20 8.4 MATERIAL ADVERSE CHANGES IN THE ISSUER S FINANCIAL SITUATION. 20 9 INFORMATION ON THIRD PARTIES, DECLARATIONS OF EXPERTS AND OF INTEREST. 20 9.1 DECLARATION OR REPORTS BY EXPERTS. 20 9.2 INFORMATION FROM THIRD PARTIES. 20 10 REFERENCE DOCUMENTS. 21 SECURITIES NOTE (ANNEX XII OF THE CE 809/2004 REGULATIONS) 22 1 INDIVIDUALS RESPONSIBLE. 22 1.1 INDIVIDUALS LIABLE FOR THE INFORMATION GIVEN IN THE SECURITIES NOTE. 22 1.2 DECLARATION BY THOSE RESPONSIBLE FOR THE SECURITIES NOTE. 22 2 RISK FACTORS. 22 3 KEY INFORMATION. 22 3.1 INTEREST OF THE INDIVIDUALS AND LEGAL ENTITIES TAKING PART IN THE OFFER. 22 3.2 DESCRIPTION OF ANY INTEREST, INCLUDING CONFLICTS, THAT MAY BE IMPORTANT TO THE ISSUE AND DETAILS OF THE INDIVIDUALS INVOLVED AND NATURE OF SUCH INTEREST. 23 4 INFORMATION CONCERNING THE SECURITIES TO BE ADMITTED TO TRADING. 23 4.1 TOTAL VALUE OF THE SECURITIES. 23 4.2 DESCRIPTION OF THE TYPE AND CLASS OF SECURITIES. 24 4.3 LEGISLATION GOVERNING THE ISSUE. 24 4.4 OWNERSHIP AND DESCRIPTION OF THE SECURITIES REGISTRATION. 24 4.5 CURRENCY OF THE ISSUE. 25 4.6 RANKING AND SUBORDINATION OF THE SECURITIES. 25 4.7 DESCRIPTION OF THE RIGHTS LINKED TO THE SECURITIES. 26 4.8 INTEREST RATE FOR THE BONDS AND INTEREST PAYMENT ARRANGEMENTS. 26 4.9 MATURITY AND AMORTISATION DATE OF THE SECURITIES. 30 4.10 INDICATION OF THE RETURN. 34 4.11 REPRESENTATION OF THE HOLDERS OF THE SECURITIES. 40 4.12 RESOLUTIONS, AUTHORISATIONS AND APPROVALS FOR THE ISSUE OF SECURITIES. 40 4.13 DATE OF ISSUE OF THE SECURITIES. 41 4.14 RESTRICTIONS TO THE FREE TRANSMISSION OF SECURITIES. 42
5 AGREEMENTS FOR THE ADMISSION TO LISTING. 42 5.1 MARKET IN WHICH THE SECURITIES WILL BE TRADED. 42 5.2 PAYMENT AGENT. 42 6 EXPENSES OF THE OFFER. 44 7 ADDITIONAL INFORMATION. 45 7.1 DECLARATION REGARDING THE CAPACITY OF THE ADVISERS MENTIONED IN THE SECURITIES NOTE. 45 7.2 OTHER INFORMATION IN THE SECURITIES NOTE AUDITED OR REVISED BY AUDITORS. 45 7.3 DECLARATION OR REPORT ATTRIBUTED TO AN INDIVIDUAL ACTING AS AN EXPERT. 45 7.4 INFORMATION ORIGINATING FROM THIRD PARTIES. 45 7.5 RATING OF THE BONDS. 46 ADDITIONAL BUILDING BLOCK TO THE SECURITIES NOTE (ANNEX VII OF THE CE 809/2004 REGULATIONS, APRIL 29, 2004) 48 1 SECURITIES. 48 1.1 MINIMUM DENOMINATION OF THE ISSUE. 48 1.2 CONFIRMATION THAT THE INFORMATION RELATING TO A COMPANY OR DEBTOR TAKING PART IN THE ISSUE HAS BEEN EXACTLY REPRODUCED. 48 2 UNDERLYING ASSETS. 48 2.1 CONFIRMATION OF THE CAPACITY OF THE SECURITISED ASSETS TO PRODUCE THE CASH-FLOW TO FUND THE SECURITIES. 48 2.2 ASSETS BACKING THE ISSUE. 49 2.3 ASSETS ACTIVELY MANAGED WHICH ARE BACKING THE ISSUE. 71 2.4 DECLARATION IN THE EVENT THAT THE ISSUER INTENDS TO ISSUE NEW SECURITIES BACKED BY THE SAME ASSETS AND DESCRIPTION OF THE METHOD USED TO NOTIFY THE HOLDERS OF THIS CLASS. 71 3 STRUCTURE AND TREASURY. 71 3.1 DESCRIPTION OF THE STRUCTURE OF THE TRANSACTION. 71 3.2 DESCRIPTION OF THE ENTITIES PARTICIPATING IN THE ISSUE AND DESCRIPTION OF THE FUNCTIONS TO BE PERFORMED BY THEM. 72 3.3 DESCRIPTION OF THE SALE PROCEDURE, DATE OF SALE, TRANSFER, NOVATION OR ASSIGNATION FOR THE ASSETS OR ANY OTHER RIGHT AND/OR ASSET OBLIGATION TO THE ISSUER. 73 3.4 EXPLANATION OF THE FUND FLOWS. 76 3.5 NAME, ADDRESS AND SIGNIFICANT BUSINESS ACTIVITIES OF THE ORIGINATORS OF THE SECURITISED ASSETS. 97
3.6 RETURN AND/OR REPAYMENT OF THE SECURITIES RELATED TO OTHER ASSETS THAT ARE NOT ASSETS OF THE ISSUER. 99 3.7 ADMINISTRATOR, CALCULATION AGENT OR EQUIVALENT. 99 3.8 NAME, ADDRESS AND BRIEF DESCRIPTION OF ANY COUNTERPARTY IN SWAP, CREDIT, LIQUIDITY OR ACCOUNT OPERATIONS. 114 4 REPORTING. 114 4.1 NOTIFICATION OF THE AMOUNTS DUE FROM PRINCIPAL AND INTEREST TO BE PAID TO THE BONDHOLDERS. 115 4.2 PERIODICAL INFORMATION. 115 4.3 OBLIGATIONS TO NOTIFY RELEVANT FACTS. 116 4.4 NOTIFICATION TO THE COMISIÓN NACIONAL DEL MERCADO DE VALORES. _ 116 4.5 NOTIFICATION TO THE RATING AGENCY. 116 DEFINITIONS 117 This document constitutes the Prospectus of IM FTPYME SABADELL 7, FTA, (hereon, the Fondo ) approved and registered at the CNMV in accordance with the European Commission s Regulation number 809/2004 and it includes: 1. A description of the main risk factors linked to the issue, the securities and the assets backing such issue (hereon, the Risk Factors ). 2. A Registration Document for the securities set out in accordance with the model included in Annex 7 of the Regulations 809/2004 (hereon, the Registration Document ). 3. Note regarding the securities, set out in accordance with the model established in Annex 13 of the Regulations 809/2004 (hereon, the Securities Note ). 4. Additional Building Block to the Securities Note set out in accordance with Annex 8 of the Regulations 809/2004 (hereon, Additional Building Block ). 5. Definitions.
RISK FACTORS 1 RISKS DERIVED FROM THE LEGAL NATURE AND THE ACTIVITY OF THE ISSUER. 1.1 Nature of the Fondo and liabilities of the Sociedad Gestora (Management Company). The Fondo constitutes a separate estate lacking legal personality that, in accordance with Real Decreto 926/1998 is managed by a management company or Sociedad Gestora. The Fondo will only be responsible for its obligations to its creditors with its own estate. For the Fondo, the Sociedad Gestora will carry out the duties established in Real Decreto 926/1998 and also, as third party manager, including the protection of the interests of the Bondholders in the absence of a Bondholders syndicate. Therefore, the ability to protect the rights of the Bondholders depends on the capabilities Sociedad Gestora. 1.2 Forced substitution of the Sociedad Gestora. In accordance with article 19 of Real Decreto 926/1998 when the Sociedad Gestora enters bankruptcy proceedings it will search for its replacement. In the event that four months have elapsed since the event that determined the substitution and no new Sociedad Gestora is willing to undertake the management of the Fondo, the Fondo will be liquidated in advance and the securities it has issued will be amortised in accordance with the Deed of Incorporation and this Prospectus. 1.3 Limitation of actions against the Sociedad Gestora. The Bondholders and other ordinary creditors of the Fondo will not enjoy the right to claim against the Sociedad Gestora of the Fondo, other than as a result of its breach of duties or its obligations established in the Deed of Incorporation, this Prospectus and current legislation. 1.4 Application of the Bankruptcy Act. The Bankruptcy of Banco de Sabadell, S.A., as Seller of the Credit Rights and issuer of the Mortgage Transfer Certificates, the goods belonging to the Fondo, with the exception of money -due to its fungible nature-, that exist in the bankrupt estate of Banco Sabadell, S.A. would belong to the Fondo and will be handed over to it, in the terms of articles 80 and 81 of Ley 22/2003, (hereon, Bankruptcy Act). Notwithstanding the above, both the Prospectus and the Deed of Incorporation establish mechanisms to mitigate such effects, in relation to money and its fungible nature. In order to mitigate the consequences of the bankruptcy of the Seller to the rights of the Fondo, and in particular, in accordance with article 1,527 of the Código Civil (Civil Code), point 10 of section 3.7.2.1 of the Additional Building Block establishes that Banco Sabadell, S.A. s sale of the Credit Rights to the Fondo will not be notified to the Debtors. Nevertheless, in the event of bankruptcy or receivership, or indications of such or administrative or 1
judicial intervention of the Seller, of the intervention of the Bank of Spain, of the liquidation or replacement of the Servicer, the Sociedad Gestora may require the Servicer to notify the Debtors, third party guarantors and underwriters of the transfer to the Fondo of the Credit Rights which remain outstanding reimbursement, and that any payments derived from them will only be released if they are made into the Treasury Account opened in the name of the Fondo. In the event of the bankruptcy of the Seller, the sale of Credit Rights to the Fondo may be reimbursed in accordance with the Bankruptcy Act and special regulations applicable to the securitisation funds. In virtue of Disposición Adicional Quinta of Ley 3/1994, the sale of Credit Rights to the Fondo will only be cancelled or contested in accordance with article 71 of the Bankruptcy Act by the bankruptcy administrator once the existence of fraud has been established. Notwithstanding the above, in the event that the sale contract meets the conditions required in Disposición Adicional Tercera of Ley 1/1999, which regulates Capital Risk Entities and their management companies (sociedades gestoras), the sale of Credit Rights to the Fondo could be liable for cancellation in accordance with the general rules established in article 71 of the Bankruptcy Act, that establishes in its section 5 that under no circumstance will the regular acts of the business activity of the Seller be cancelled if they have been carried out under normal circumstances. In the event of the bankruptcy of Banco de Sabadell, S.A., in accordance with the Bankruptcy Act, the Fondo, acting through the Sociedad Gestora, will have a separation right in respect of the Credit Rights. Nevertheless, this separation right does not necessarily include the sums of cash Banco de Sabadell, S.A. has received and held on behalf of the Fondo prior to such date, as the Fondo might be affected by the bankruptcy ruling, in accordance with the accepted interpretation of article 80 of the current Bankruptcy Act, as a result of the fungible nature of money. Furthermore, and in order to mitigate such risk certain mechanisms have been incorporated and are described in sections 3.4.4.1 (Treasury Account), 3.4.4.2 (Principal Account), 3.4.5 (the Fondo s collection of the payments related to the assets) and 3.7.2 (Custody and Management of the securitised assets) of the Additional Building Block. The Sociedad Gestora shall be replaced by another in accordance with article 19 of Real Decreto 926/1998 in the event of bankruptcy. The structure of this operation of asset securitisation does not permit, except when the parties are in breach, the existence of cash that might be added to the mass of the Sociedad Gestora, as the amounts that correspond to the income of the Fondo must be transferred by the Sociedad Gestora, in the terms of this Prospectus, to the accounts opened in the name of the Fondo. The Sociedad Gestora opens these accounts as legal representative of the Fondo and not as just its main operator. As a result of this, the Fondo will enjoy the right of separation, in the terms described in articles 80 and 81 of the Bankruptcy Act. Notwithstanding the above, the bankruptcy of any of the participants (Banco de Sabadell, S.A., the Sociedad Gestora or any other counterpart of the Fondo) may affect its contractual relations with the Fondo. 2
2 RISKS DERIVED FROM THE SECURITIES. 2.1 Liquidity. The Seller, as Subscriber, has undertaken to subscribe in its entirety the Bonds of Series A1, B and C. Series A2 (G) Bonds will be placed and underwritten by the Underwriters and Placement Entities of Series A2 (G). The Seller, as Subscriber, has declared that once the Series A1 Bonds have been subscribed, its intention is to use them as assets backing credit operations in the Eurosystem. Equally, the Seller, as Subcriber, has declared that its subscription of the Bonds of any Series does in no way limit any other use of the Bonds or their eventual sale. As the Series A1, B and C Bonds will be entirely subscribed by the Seller, and as a consequence, their price will not be subject to contrast via market transaction, it is not possible to state that the financial conditions of the Bonds correspond to those that might be current in the secondary market on the Date of Incorporation of the Fondo. This note on the value of the Bonds is carried out in order to inform third parties, specifically investors or Bondholders acquiring them as guarantee, like the Central European Bank for credit transactions in the Eurosystem. 2.2 Yield. The calculation of the internal rate of return, average life and the term of the Bonds is subject to different assumptions for prepayment rates and specific evolution of the interest rates that might not occur. The prepayment rate of the Credit Rights might be affected by a variety of geographical, economic and social factors, like seasonality, market interest rates, the sectorial distribution of the portfolio and, in general, the level of economic activity. 2.3 Term. The calculation of the average life and term of the Bonds of each Series included in section 4.10.1 of the Securities Note is subject to the fulfilment of the amortisation tables of the Loans and the Mortgage Loans and the early amortisation rate assumptions that may not happen. The fulfilment of said tables is affected by a variety of economic and social factors such as market interest rates, the financial situation of the debtors and the general level of economic activity that hinder the establishment of a forecast. 2.4 Penalty Interest. Delays in the payment of interest or principal to the Bondholders will not accrue penalty interest in their favour. 3 RISKS DERIVED FROM THE ASSETS BACKING THE ISSUE. As covered by section 4.5 of the Registration Document, the Fondo is a separate estate with no legal personality in its own right, therefore its specific risks are those of the Assets backing the issue and are (i) risks linked to the field of activity in which the Assets have been generated, and/or (ii) risks linked to the Assets themselves. 3
3.1 Risk linked to the field of activity. The field with the highest relevance in the portfolio to be securitised on August 29, 2008, (24,7% of the portfolio, 537 loans with a current balance of 294,197,642.88 Euros) is the Real Estate sector, in accordance with the table included in section 2.2.2.b of the Additional Building Block. Also, 5.44% of the current balance of the eligible portfolio on that same date corresponds to the Construction sector. Both sectors jointly make up 30.1% of the total eligible portfolio. Nevertheless, the fields of activity of the Debtors are varied therefore it can be stated that the risk of default of the Assets is not linked to the evolution of a specific sector of activity but rather to the evolution of the Spanish economy. As a result of the levels of sectorial concentration described above and in section 2.2.2.b) of the Additional Building Block, a situation of any nature that has a substantial negative effect on real estate and construction activities, could affect the Loan and Mortgage Loan payments that back the Bond issue. 3.2 Risk of default of the Credit Rights. The holders of the Bonds issued by the Fondo will bear the risk of default of the Credit Rights grouped therein, always taking into consideration the credit enhancement instruments provided and described in section 3.4.2 of the Additional Building Block. Banco de Sabadell, S.A., as Seller, does not assume any responsibility for the debtors delinquency of the Credit Rights, either for their principal and interest or any other amount owed from the Credit Rights. Banco de Sabadell, S.A., in accordance with article 348 of the Código de Comercio (Commercial Code), is liable to the Fondo exclusively for the existence and title of the Credit Rights and of the title under which it carries out the sale. Banco de Sabadell, S.A., will not assume, in any other form, responsibility in guaranteeing directly or indirectly the success of the transaction, nor will it grant guarantees or enter into agreements to repurchase the Credit Rights, except in the events described in sections 2.2.9 and 3.7.2 of the Additional Building Block related to the replacement of Credit Rights that do not meet the declarations included in section 2.2.8 of the Additional Building Block. The Bonds issued by the Fondo do not constitute an obligation on the part of Banco de Sabadell, S.A. or the Sociedad Gestora. With the exception of the State Guarantee, described in section 3.4.7.2 of the Additional Building Block, there are no other guarantees granted by public or private entity, including Banco de Sabadell, S.A., the Sociedad Gestora and any other company affiliated to or participated by any of the above. 3.3 Risk of early amortisation of the Credit Rights. The Credit Rights grouped in the Fondo may be prepaid when the debtors reimburse the portion of outstanding principal of such Credit Rights. The risk of prepayment will be transferred quarterly, on each Payment Date to the Bondholders in accordance with the rules of Distribution of the Available Resources set out in section 4.9.4 of the Securities Note. 4
3.4 Limited Hedging. In the event that the defaults reach an elevated level they might reduce, or even eliminate, the protection against loss in the Credit Right portfolio enjoyed by the Bonds of each Series provided by the credit enhancement instruments described in section 3.4.2 of the Additional Building Block. The degree of subordination in the payment of interest and reimbursement of principal of the Bonds of all Series and that derives from the Priority Order of Payments and the Priority Order of Payments for Liquidation constitutes a protection mechanism different for each Series. 3.5 Limited Responsibility. Bonds issued by the Fondo do not represent an obligation of the Sociedad Gestora or the Seller. The flow of resources used to attend the obligations derived from the Bonds is ensured or guaranteed only in the specific circumstances and with the limitations set out in this Prospectus, the Deed of Incorporation and the rest of the contracts related to the incorporation of the Fondo. With the exception of these guarantees, there are no others granted by public or private institutions, including the Seller, the Sociedad Gestora and any other entity affiliated or participated by any of the above. The Credit Rights are the main source of income of the Fondo and, therefore, of payments to the holders of its liabilities. 3.6 Year of issue concentration. As detailed in section 2.2.2 of the Additional Building Block, in relation with the year of issue of the loans selected to be sold to the Fondo, there is a higher concentration according to the percentage of outsanding principal to be collected from the loans selected in the years 2007 and 2008, 66.64% of the total Eligible Portfolio. 3.7 Interest type risk. The weighed average interest rate of the assets on August 29, 2008, is 5.52%, and the average interest rate of the Bonds is 5.54% (assuming the forecasts of this Prospectus). The Interest Swap Agreement subscribed between the Fondo and Banco de Sabadell, S.A. covers this contingency, and grants the Fondo an excess margin of 0.25% over Party B s Swap notional, as described in section 3.4.7.1 of the Additional Building Block. 3.8 Risk of Debtor Concentration. As described in section 2.2.2.a) of the Additional Building Block, the Debtor with the highest amount in the group of Debtors has 1.13% of the Prior Portfolio on August 29, 2008. The group comprised of the ten Debtors with higher amounts is 9.37% of the total Prior Portfolio, an amount of 111,657,720.51 Euros. As a result of this level of concentration, any situation that has a substantial negative effect over these ten Debtors could affect the Asset payments that back the Bond Issue. In accordance with section 3.4.2.2, the size of the Reserve Fund will fall between 4.75% and 2.375% of the total amount of the Bond issue. 5
REGISTRATION DOCUMENT FOR SECURITIES (ANNEX VII OF THE CE 809/2004 REGULATIONS) 1 INDIVIDUALS RESPONSIBLE. 1.1 Individuals responsible for the information given in the Registration Document. José Antonio Trujillo del Valle, in the name and on behalf of INTERMONEY TITULIZACIÓN, SGFT, S.A. (hereon, the Sociedad Gestora ), entity promoting IM FTPYME SABADELL 7, FONDO DE TITULIZACIÓN DE ACTIVOS (hereon, the Fondo ), assumes responsibility for the contents of this Registration Document. José Antonio Trujillo del Valle, Chairman of INTERMONEY TITULIZACIÓN, SGFT, S.A., in virtue of the agreement of the Board of Directors of the Sociedad Gestora in its meeting held on July 17, 2008. 1.2 Declaration by those responsible for the contents of the Registration Document. José Antonio Trujillo del Valle, Sociedad Gestora representative, declares that, following due diligence to guarantee the information included in this Registration Document, to his knowledge, it is in accordance to fact and does not incur in any omission that may affect its content. 2 ACCOUNTING AUDITORS. 2.1 Auditors of the Fondo. In accordance with section 4.4.2 of this Registration Document, there is no historical financial information on the Fondo. The Board of Directors of the Sociedad Gestora, in its meeting of July 17, 2008, has designated Ernst & Young (Official Register for Account Auditors or R.O.A.C. number S0530, located at Plaza Pablo Ruiz Picasso 2, 28020 Madrid and with Tax Code B-78970506) as auditors of the Fondo, without specifying the accounting terms for which they are appointed. The Board of Directors of the Sociedad Gestora will inform the Comisión Nacional del Mercado de Valores (hereon, the CNMV ) of any change which may occur in respect of the designation of the auditors. The annual accounts of the Fondo and the audit report will be deposited at the CNMV and the Registro Mercantil (Companies House) each year. 2.2 Accounting criteria used by the Fondo. The income and expenses will be recognised by the Fondo following the accrual principle, that is, in the time in which such income and expenses occur, irrespective of the date in which they are collected and paid. 6
The accounting periods of the Fondo will coincide with the natural calendar. Nevertheless and by exception, the first accounting period will begin on the Date of the Incorporation of the Fondo, and the last will end on the date of the extinction of the Fondo. 3 RISK FACTORS. Risk factors derived from the Issuer s legal nature and its activity are described in section 1 of this Prospectus, Risk Factors. 4 INFORMATION ABOUT THE ISSUER. 4.1 Declaration of the establishment of the Issuer as Fondo de Titulización. IM FTPYME SABADELL 7, FONDO DE TITULIZACIÓN DE ACTIVOS is the issuer of the securities mentioned in the Securities Note, and will be incorporated in accordance with the current Spanish legislation that regulates such Fondos de Titulización de Activos, in order to issue the securities referred to in the Securities Note and to purchase the Credit Rights. 4.2 Name of the issuer. The name of the Fondo is IM FTPYME SABADELL 7, FONDO DE TITULIZACIÓN DE ACTIVOS. 4.3 Place of registration of the Issuer and its registration number. The incorporation of the Fondo and the issue of the Bonds must be previously registered in the Official Registers of the CNMV, in accordance with article 26 and following of Ley 24/1988 (Securities Market Act). This Prospectus has been inscribed in such registers on September 19, 2008. It is hereby stated that neither the incorporation of the Fondo or the Bonds issued from its assets will be inscribed in the Registro Mercantil (Companies House), as a result of the faculty power included in article 5.4 of Real Decreto 926/1998. 4.4 Date of Incorporation and period of activity of the Issuer. 4.4.1 Date of Incorporation of the Fondo. Once this Prospectus has been registered by the CNMV and prior to the opening of the Subscription Period of the Bonds, the Sociedad Gestora, together with the Seller, will grant the Deed of Incorporation of the Fondo. This will take place on the Date of the Incorporation of the Fondo, September 22, 2008. The Sociedad Gestora declares that the content of such Deed of Incorporation will coincide with the draft project for the Deed of Incorporation that has been deposited at the CNMV, and that, under no circumstances will the terms of the Deed of Incorporation contradict, modify, alter or invalidate the contents of this Prospectus. The Deed of Incorporation can only be modified under exceptional circumstances and when in accordance with current rules and legislation. In any event, such actions will be previously notified by the Sociedad Gestora to the CNMV or other apropriate body, or 7
will request its prior authorisation if necessary, and will notify the Rating Agency. These actions will not negatively affect the ratings assigned to the Bonds by the Rating Agency or the rights of the Bondholders. The Deed of Incorporation may also be amended by request from the CNMV. The Deed, in accordance with Ley 19/1992 will follow article 6 of Ley 24/1988 and will be, therefore, the deed of the issue of the Bonds and the deed stating the representation of the Bonds as book entries. 4.4.2 Period of Activity of the Fondo. The activity of the Fondo will begin on the day of the granting of the Deed of Incorporation. The duration of the Fondo will extend until the Final Date, except in the event of the prior Early Liquidation of the Fondo as covered in section 4.4.3 of the Registration Document or in the event of any of the events covered in section 4.4.4 of the Registration Document. The Final Date shall be September 22, 2044, the Payment Date immediately following the 42 months elapsed since the Maximum Date of Maturity of the Credit Rights. 4.4.3 Early Liquidation of the Fondo. The Sociedad Gestora, prior notification to the CNMV, is entitled to proceed to liquidate the Fondo in advance (hereon, the Early Liquidation of the Fondo ) to amortise the Bonds in advance (hereon, the Early Amortisation ) and to extinguish the Fondo on a Payment Date (hereon, the Date of the Early Liquidation ) in any of the following situations (hereon, the Early Liquidation Events ): (i) (ii) When the Outstanding Principal Balance of the Non-Defaulted Credit Rights is lower than 10% of the Initial Balance of the Credit Rights on the Date of Incorporation (in accordance with article 5.3 of Ley 19/1992), and whenever the proceeds from the sale of the Credit Rights, pending amortisation, together with the balance of the Treasury Account, and if applicable the Principal Account, permit the total cancellation of the outstanding payment obligations of the Fondo, and observing prior payments with preferential rank in the Priority of Payments, and once all the necessary authorisations from the relevant authorities have been obtained. When, as a result of any event or circumstance related or not to the operation of the Fondo, a substantial alteration occurs or the financial balance of the Fondo is permanently altered in accordance with section 5.6 of Ley 19/1992. This includes the existence of a change in the Law or complementary Acts, the establishment of withholding obligations or other situations that may affect the financial balance of the Fondo. In this event, the Sociedad Gestora, following notification to the CNMV will proceed to the liquidation of the Fondo in accordance with the rules established in the Deed of Incorporation and this Registration Document. (iii) By obligation, in the event that the Sociedad Gestora is declared bankrupt, and following the lapse of the legally established term, or by defect four months, no 8
replacement management company has accepted the designation in accordance with section 3.7.1 of the Additional Building Block. (iv) In the event of a default indicative of a serious and permanent unbalance of any of the Bonds issued takes place or is expected to happen. (v) 36 months after the date of the last maturity of the Credit Rights, even if there are outstanding payments to be collected. Nevertheless, the Final Date of the Fondo shall be the Payment Date immediately following the 42 months elapsed since the Maximum Date of Maturity of the Credit Rights. (vi) When the Sociedad Gestora has the deliberate authorisation from all the Bondholders of all Series and all those holding valid contracts with the Fondo, either for payment of amounts derived from the Early Liquidation or in relation to the procedure to be carried out. In relation to this section, payment obligations of the Fondo on the Date of the Early Liquidation will be understood as the Outstanding Principal Balance of the Bonds on such date, plus the interest accrued and not paid to date, minus, if applicable, withholding and all amounts considered due and liable on that date. Requirements to proceed to the Early Liquidation of the Fondo: (i) (ii) To obtain, if applicable, all the necessary authorisations by the relevant authorities or administrative bodies. That the Bondholders are notified, following the procedure established in this section and with a 15-Business Day notice, of the agreement of the Sociedad Gestora to proceed to the Early Liquidation of the Fondo. This notification, previously notified to the CNMV, -publishing the appropriate relevant fact in accordance with article 82 of the Securities Market Act-, and to the Rating Agency, will also be published in the Boletín de Cotización Diario (Daily Exchange Rate Bulletin) of the Mercado AIAF or through any other means of diffusion generally accepted by the market and that guarantees the adequate diffusion of information, in time and contents. This notification will contain the description of (i) the event (s) forcing the Early Liquidation of the Fondo, (ii) the procedure followed, and (iii) the method elected to attend and cancel the payment obligations derived from the Bonds in accordance with the Priority of Payments established in section 3.4.6 of the Additional Building Block. In order for the Fondo, through its Sociedad Gestora, to carry out the Early Liquidation of the Fondo and the Early Amortisation of the Bond Issue, the Sociedad Gestora, in the name and on behalf of the Fondo, will: (i) (ii) Sell the Credit Rights for an amount that will not be less than the sum of the value of the principal plus interest accrued and not collected from the Credit Rights that remain to be amortised. Cancel all Agreements that are not necessary for the liquidation procedure. In the event that, the above measures are insufficient and Credit Rights or other assets remain in the Fondo, the Sociedad Gestora will proceed to sell them. To do so it shall request offers from, at least, five institutions among those most active in the market of 9
these assets that, in its opinion, can offer market value. The Sociedad Gestora must accept the best offer that, in its opinion, covers the market value of the assets. In order to establish market value, the Sociedad Gestora may request the valuation reports it considers necessary. The Seller will enjoy a pre-emption right before third parties to repurchase the Credit Rights or other rights derived from them that remain in the assets of the Fondo (Derecho de Tanteo). To this end the Sociedad Gestora will provide the Seller with a list of the assets and the bid offers received from third parties. This right of repurchase can be exercised in the 10 Business Days following the reception of such list and as long as the offer of the Seller equals, at least, the best of the offers received from third parties. This right does not imply, under any circumstance, the Seller s pact or declaration to repurchase the Credit Rights. The Sociedad Gestora, once a reserve for extinction expenses is made, will apply all amounts received from the sale of the Credit Rights of the Fondo to pay the different concepts, according with the Priority of Payments for Liquidation, in accordance with section 3.4.6 of the Additional Building Block. 4.4.4 Termination of the Fondo. The Fondo will be terminated as a result of the following circumstances: (i) (ii) When all its Credit Rights are fully amortised. When all the payment obligations of the Fondo are met. (iii) Following the end of the Early Liquidation of the Fondo procedure described in section 4.4.3 of this Registration Document. (iv) In any event, on the Payment Date immediately following the date of the 42- month anniversary of the Maximum Date of Maturity of the Credit Rights, even if there are amounts due that have not been collected, that is, the Final Date of the Fondo. (v) In the absence of confirmation as final, prior to the opening of the Subscription Period of the Bonds, of the provisional rating assigned to the Bonds by the Rating Agency, (or if prior to the Date of Subscription an unforeseen or unforeseeable event takes place, and in accordance with article 1,105 of the Código Civil (Civil Code) and with the Management and Subscription Agreement for the Bond issue). In this situation, the Sociedad Gestora will cancel the incorporation of the Fondo, the subscription of the Credit Rights, the issue of the Bonds and the remaining contracts of the Fondo. The CNMV will be notified as soon as the extinction is confirmed and will be made public using the procedure described in section 4.3 of the Additional Building Block. In the maximum term of one month from the event forcing the resolution, the Sociedad Gestora will issue a notary deed declaring that the payment obligations of the Fondo have been cleared and paid and that it is extinct. 10
In the event that, following the liquidation or extinction of the Fondo and the payment owed to the different creditors via the distribution of the Available Resources for Liquidation of the Fondo, in accordance with the Priority of Payments for Liquidation, established in section 3.4.6.2 of the Additional Building Block, amounts remain they will belong to the Seller under the conditions established by the Sociedad Gestora. In any event, the Sociedad Gestora, acting on behalf and in representation of the Fondo, will not extinguish the Fondo and cancel its inscription in the appropriate administrative registers until all the remaining assets of the Fondo have been liquidated and Available Resources for Liquidation are distributed in accordance with the Priority of Payments for Liquidation, in accordance with section 3.4.6.2 of the Additional Building Block, except the reserve set aside to pay for the fiscal, administrative and publicity final extinction expenses. In the event of the liquidation of the Fondo as a result of section (i) through (iv) above and following a term of 6 months since the liquidation of the remaining assets of the Fondo and the distribution of the Available Resources, the Seller will issue a notary deed declaring (i) the extinction of the Fondo and the causes forcing its extinction, (ii) the procedure followed to notify the Bondholders and the CNMV, and (iii) the distribution of Amounts Available for Liquidation, following the Priority of Payments for Liquidation, and will comply with the remaining necessary administrative procedures. The Sociedad Gestora will forward this deed to the CNMV. In the event of the liquidation of the Fondo as a result of section (v) above, and therefore, all the contracts of the Fondo have been cancelled, the Seller will pay all the initial expenses derived from the incorporation of the Fondo up to the maximum amount determined in the Subordinated Loan Agreement for Initial Expenses. 4.5 Address, legal title and legislation applicable to the Issuer. In accordance with article 1 of Real Decreto 926/1998, the Fondo will have a separate estate, with no legal personality in its own right, and will closed by both assets and liabilities, in accordance with article 3 of Real Decreto 926/1998. InterMoney Titulización, S.G.F.T., S.A., constituted as Sociedad Gestora and empowered to such effect, will be in charge of the legal representation and administration of the Fondo, in accordance with Real Decreto 926/1998. The Fondo will have its registered address at the address of the Sociedad Gestora, Plaza Pablo Ruiz Picasso s/n, Torre Picasso, planta 22, Madrid (Spain). The Sociedad Gestora s telephone number is +34 91 432 64 88. Further contact details of the Sociedad Gestora and the Fondo can be found at www.imtitulizacion.com. The incorporation of the Fondo and the issue of the Bonds is regulated by Orden PRE/3/2007, de 10 de enero sobre los Convenios de Promoción de Fondos de Titulización de Activos para favorecer la financiación empresarial and article 7 of Real Decreto-ley 2/2008, de 21 de abril, de Medidas de impulso a la actividad económica. The Fondo IM FTPYME SABADELL 7 is regulated in accordance with (i) this Prospectus, (ii) the Deed of Incorporation of the Fondo, (iii) Real Decreto 926/1998 and any further developments of such Act, (iv) Ley 19/1992, de 7 de julio, sobre Régimen de Sociedades y Fondos de Inversión Inmobiliaria y sobre Fondos de Titulización Hipotecaria, for aspects not covered by Real Decreto 926/1998, and when applicable, (v) Disposición Adicional Quinta of Ley 3/1994, (vi) Real Decreto 1310/2005, de 4 de noviembre, por el 11
que se desarrolla parcialmente la Ley 24/1988, de 28 de julio, del Mercado de Valores, en materia de admisión a negociación de valores en mercados secundarios oficiales, de ofertas públicas de venta o suscripción y del folleto exigible a tales efectos, (vii) Orden PRE/3/2007, de 10 de enero sobre los Convenios de Promoción de Fondos de Titulización de Activos para favorecer la financiación empresarial, (viii) article 7 of Real Decreto-ley, de 21 de abril, de Medidas de impulso a la actividad económica, (ix) Ley 24/1988, de 28 de julio, del Mercado de Valores, en lo referente a su supervision, inspección y sanción, in its current wording, (x) Orden EHA/3537/2005, de 10 de noviembre, por la que se desarrolla el artículo 27.4 de la Ley 24/1988, de 28 de julio, del Mercado de Valores and (xi) any other current laws and regulations that may be applicable at any given time. The Prospectus follows the templates of Reglamento (CE) nº 809/2004 de la Comisión de 29 de abril de 2004, related to the application of Directiva 2003/71/CE del Parlamento Europeo y del Consejo en cuanto a la información contenida en los folletos, así como el formato, incorporación por referencia, publicación de dichos folletos y difusión de publicidad. Equally, any dispute related to the Fondo that may arise during its operation or liquidation, either between the Bondholders or the Bondholders and the Sociedad Gestora will be subject to the Courts and Tribunals of Madrid, waiving any other forum that might be applicable. 4.5.1 Taxation regime of the Fondo. In accordance with article 1.2 of Real Decreto 926/1998; article 5.10 of the Ley 19/1992; article 7.1.h) of Real Decreto Legislativo 4/2004, which approves the New Text of the Corporate Tax Act; article 20.1.18 of the Ley 37/1992 (Value Added Tax Act); article 59.k) of Real Decreto 1777/2004, approving Corporate Tax Regulations; article 45.I.B).15 of Real Decreto 1/1993, approving the New Text of the Stamp Tax Act, and the Disposición Adicional Quinta of the Ley 3/1994 and Ley 35/2006 (Personal Tax Act and modifications to Corporate Tax, Tax for Non Residents, Patrimony), the specific characteristics of the current taxation regime for the Fondo are as follows: a) The incorporation of the Fondo is exempt from the Stamp Tax heading corporate operations. b) The issue, subscription, sale and amortisation of the Bonds is subject and exempt from Value Added Tax and from Stamp Tax. c) El Fondo is subject to Corporate Tax by applying the general rate currently fixed at 30% for periods beginning January 1, 2008, and subject to standard rules for quota deductions, compensation for loss and other basic elements making up the tax. d) The services of management and custody to the Fondo carried out by the Sociedad Gestora are subject and exempt from VAT. e) In relation to the returns from the Credit Rights that constitute income of the Fondo, there will be no obligation to withhold or to pay in the Corporate Tax. f) The sale to the Fondo of the Mortgage Transfer Certificates and the Loans is a transaction subject and exempt from VAT and Stamp Tax. g) The Fondo is subject to the general obligations to notify and those included in Real Decreto 1065/2007. 12
4.6 Issuer s Authorised and issued capital. Not applicable. 5 DESCRIPTION OF THE FONDO DE TITULIZACIÓN. 5.1 Main activity. The sole purpose of the Fondo shall be the transformation of the grouped Assets into homogeneous and standardised fixed income securities and capable, therefore, of being traded in organised securities markets. The activity of the Fondo consists of the acquisition of a group of Credit Rights held by the Seller, and granted to non-financial companies (companies or individual business persons), described in section 2.2.2 of the Additional Building Block of this Prospectus, and the issue of securitised bonds destined to finance the purchase of such Credit Rights. Banco de Sabadell will subscribe 100% of the A1, B and C Series of Bonds. Société Générale, S.A. and BBVA, S.A. will underwrite Series A2 (G). Income from interest and reimbursement of principal received from the Credit Rights acquired by the Fondo will be applied, quarterly, on each Payment Date to make payments due by the Fondo, in accordance with the Priority of Payments established in section 3.4.6 of the Additional Building Block. Furthermore, the Fondo will arrange, through the Sociedad Gestora, financial operations and agreement services to consolidate the financial structure of the Fondo, to increase its security and the regularity of the Bond payments, to cover temporary deficits between the principal and interest flows from the Credit Rights and the Bonds and, in general, to facilitate the financial transformation taking place by virtue of the structure of the Fondo between the financial characteristics of the Credit Rights and those of the Series of Bonds. The Sociedad Gestora, in the name of the Fondo, declares that the descriptions of all the contracts (Treasury Account, Principal Account, Payment Agency, Management and Subscription and Placement, Loan for Initial Expenses, Loan for First Period Interest, Management, Loan for the Reserve Fund and Financial Swap) included in the appropriate sections of this Prospectus, to be subscribed by the Fondo, include the most relevant information of each agreement, reflect their content and do not omit any information that may affect the contents of the Prospectus. 5.2 General description of the participants in the securitisation. - The Sociedad Gestora of the Fondo shall be INTERMONEY TITULIZACION S.G.F.T., S.A. and will arrange, administer and legally represent the Fondo. InterMoney Titulización has also carried out the financial design of the operation and the Bond issue. Intermoney Titulización, S.G.F.T., S.A. is a management company of securitisation funds incorporated in Spain and registered at the Madrid Companies House (Registro Mercantil de Madrid), Volume 19, 277, book 0, sheet 127, section 8, page M-337707, inscription 1, on October 21, 2003, and also at the Registro Especial de Sociedades Gestoras de Fondos de Titulización of the Comisión Nacional del Mercado de Valores as number 10. 13
Registered address: Plaza Pablo Ruiz Picasso s/n, Torre Picasso, floor 22, 28020 Madrid Tax Code (CIF): A-83774885 Economic Activity Code (CNAE): 67 - BANCO DE SABADELL, S.A., acts as Seller of the Credit Rights, Payment Agent and counterparty of the Fondo in the Payment Agent Agreement. Banco de Sabadell, S.A. will also act as Lead Manager and Subscriber of the A1, B and C Bonds, assuming the roles included in article 35.1 of Real Decreto 1310/2005. Banco de Sabadell, S.A. also acts as counterparty of the agreements for the Loan for Initial Expenses, the Loan for First Period Interest, the Management Agreement, the Loan for for the Reserve Fund and the Financial Swap. Banco de Sabadell, S.A., is a bank incorporated in Spain and registered in the Registro Especial de Bancos y Banqueros del Banco de España (Bank of Spain s Special Register for Banks and Bankers) with number 0081. It has been registered in the Registro Mercantil (Companies House) of Barcelona, volume 20,093, sheet 1, page B-1561, inscription 580. Operative headquarters: Plaça Catalunya 1, Sabadell (Barcelona) Polígono Can Sant Joan, Sena 12, 08174 Sant Cugat del Vallés (Barcelona) C.I.F.: A-08000143. Unsubordinated and unsecured short and long-term debt ratings assigned by the Rating Agencies: RATINGS Fitch Moody s S&P Short-term F1 P-1 A1 Long-term A+ Aa3 A+ Outlook Stable Stable Stable These ratings have been confirmed on July 30, 2008 (Fitch), August 27, 2008 (Moody s) and March 12, 2008 (S&P). - SOCIÉTÉ GÉNÉRALE, S.A., is the Underwriter and Placement Agent of the A2 (G) Bonds and also acts Lead Manager. Société Générale, S.A., is a credit entity registered in the Registro Mercantil (Companies House) of Madrid, volume 10,205, sheet 35, page 18,909, inscription 480. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 0108 as a foreign credit entity from the European Union. Registered address: Torre Picasso, Plaza Pablo Ruiz Picasso 1, 28020 Madrid. C.I.F.: A-0011682B. 14
Unsubordinated and unsecured short and long-term debt ratings assigned by the Rating Agencies: RATINGS Fitch Moody s S&P Short-term F1+ P-1 A-1+ Long-term AA- Aa2 AA- These ratings have been confirmed on January 24, 2008 (Fitch and Moody s) and February 15, 2008 (S&P). - Banco Bilbao Vizcaya Argentaria, S.A. (BBVA, S.A.), is the Underwriter and Placement Agent of the A2 (G) Bonds. BBVA, S.A. is a credit entity registered in the Registro Mercantil (Companies House) of Vizcaya, in inscriptions 1 and 156, Volumes 2,083 and 2,227, Section 3, Sheets 183 and 49, page BI-17 and inscription 1035. It is an entity subject to supervision from the Bank of Spain and registered in the special administrative register with number 3, and code 0182. Registered address: Plaza de San Nicolás 4, 48005 Bilbao C.I.F.: A-48265169. Unsubordinated and unsecured short and long-term debt ratings assigned by the Rating Agencies: RATINGS Fitch Moody s S&P Short-term F1+ P-1 A-1+ Long-term AA- Aa1 AA These ratings have been confirmed in June, 2008 (Fitch and Moody s) and February, 2008 (S&P). - Cuatrecasas Abogados, S.R.L. has provided the legal advice for the operation. Registered address: Paseo de Gracia, 111, 08008 Barcelona. Tax Code (CIF): B-59942110. Cuatrecasas Abogados, S.R.L. is registered in the Barcelona Companies House (Registro Mercantil) in volume 37,673, Sheet 30, Section 8, Page 23,850. - Standard & Poor s, S.L. acts as Rating Agency for the Bonds. Registered address: Calle Marqués de Villamejor, 5, 28006 Madrid. 15
Tax Code (CIF): A-80310824. The responsibilities of each of these entities are included in section 3.1 of the Securities Note. The Sociedad Gestora belongs to the group of companies Corretaje e Información Monetaria y de Divisas, S.A. that holds 70% of its shares. There is no information on the existence of any other type of direct or indirect property or control between the participants of the securitisation transactions. 6 ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES. The management and legal representation of the Fondo will correspond to the Sociedad Gestora, InterMoney Titulización, SGFT, S.A., in the terms established by Real Decreto 926/1998, Ley 19/1992, and the terms of the Deed of Incorporation. 6.1 Incorporation and inscription in the Registro Mercantil (Companies House). InterMoney Titulización, S.G.F.T., S.A. was incorporated through a public deed executed on October 16, 2003, in the presence of the Madrid Notary Public D. Antonio Huerta Trolez, protocol number 2572, and with prior authorisation from the Ministerio de Economía y Hacienda on October 6, 2003. It is registered in the Registro Mercantil de Madrid (Companies House) in Volume 19,277, Book 0, Sheet 127, Section 8, Page M-337707, inscription 1, on October 21, 2003, and in the Registro Especial de Sociedades Gestoras de Fondos de Titulización (Special Register for Management Companies for Fondos de Titulización) at the CNMV with number 10. The Sociedad Gestora has perpetual existence, with the exception of the occurrence of any of the causes for dissolution established by legal and statutory regulations. 6.2 Account auditing. The annual accounts of InterMoney Titulización for the years ending on December 31, 2005, 2006 and 2007 have been audited by Price Waterhouse Coopers S.L., with its registered address in Madrid and registered in the ROAC (Official Register for Account Auditors) with number S0242. The audit reports for the annual accounts for the years 2005, 2006 and 2007 do not present exceptions and have been deposited at the CNMV. 6.3 Corporate purpose. In accordance with legal requirements, Article 2 of its Statutes states that: the Company has the sole purpose of incorporating, managing and legally representing both Fondos de Titulización de Activos and Fondos de Titulización Hipotecaria. Furthermore, and in accordance with current applicable legislation, it will be responsible, as manager of third party business, for the representation and defence of the interests of the holders of the securities issued by the Fondos it manages and of all the other ordinary creditors of the Fondo. Main activity: InterMoney Titulización, on September 15, 2008, manages the following securitisation funds: 16
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