Arran Funding (UK) Plc, the issuing entity, is a public limited liability company which was incorporated in England and Wales, as a special purpose vehicle for the issue of asset backed securities, under the Companies Act 1985 (as amended) on 18 November 2008 with registered number 06752478. Its registered office and principal place of business are located at Eighth Floor, 68 King William Street, London EC4N 7DZ. The issuing entity does not have any subsidiaries. Its telephone number is + 44 (0)20 7469 8000.
The issuing entity was incorporated with an authorised share capital of £50,000, comprising 50,000 ordinary shares of £1 each. Two ordinary shares were allotted for cash, and fully paid, on incorporation.
On 26 November 2008, 49,998 ordinary shares were resolved to be allotted and on 4 December 2008 were each quarter paid. 49,999 shares are held by Arran Holdings Limited and one share is held by a share trustee under the terms of a share declaration of trust on trust for Arran Holdings Limited.
Arran Holdings Limited is a private limited company that was formed in Jersey, Channel Islands on 2 February 2000 with registered number 76198. The registered office of Arran Holdings Limited is at 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands. All of its issued share capital is held by Juris Limited and Lively Limited as nominees for a trust company incorporated in Jersey, Mourant & Co.
Trustees Limited, which holds such shares on trust for charitable purposes.
The issuing entity was formed principally to:
• issue notes from time to time;
• enter into and perform its duties under all financial arrangements in connection with the programme;
• purchase the relevant loan notes;
• enter into and perform its duties under all the documents necessary to purchase each relevant loan note as specified in each set of final terms;
• enter into and perform its duties under all of the programme documents and exercise its powers in relation to the issue of the notes; and
• exercise its related rights and powers pursuant to the programme documents to which it is a party and perform any other activities incidental thereto.
Directors and Secretary
The following sets out the directors of the issuing entity and their business addresses and principal activities. The issuing entity is organised as a special purpose vehicle and will be largely passive, engaging only in the types of transactions described in this base prospectus. The issuing entity is managed and controlled by its directors in the United Kingdom, however, in conducting its business, the company only requires a small amount of active management.
Name Age Nationality Business Address Principal Activities Vincent Rapley 48 British Eighth Floor, 68 King
William Street, London EC4N 7DZ
Managing Director, Mourant International Finance Administration
Ian O'Meara 42 British Eighth Floor, 68 King
William Street, London EC4N 7DZ
Solicitor
Mourant & Co Capital (SPV) Limited provides the issuing entity with general secretarial, registrar and company administration services under the terms of an agreement which we will refer to as the
"corporate services agreement". The fees of Mourant & Co Capital (SPV) Limited for providing such services will be included in the amount of interest paid by the loan note issuing entity to the issuing entity in respect of each series loan note – see "The Loan Notes".
The secretary of the issuing entity is:
Name Business Address
Mourant & Co Capital Secretaries Limited Eighth Floor, 68 King William Street, London EC4N 7DZ The net proceeds of the sale of each series of notes will be used by the issuing entity to purchase the corresponding series loan note. The issuing entity will be prohibited by the trust deed, the relevant trust deed supplement and the terms and conditions of the relevant series of notes from engaging in any business other than:
• the business described in this base prospectus;
• issuing the notes and using their proceeds to acquire the corresponding series loan note; and
• performing its obligations and preserving and exercising its rights under the dealer agreement, the loan notes, the agency agreement, the trust deed, each trust deed supplement, the expenses loan agreement, any swap agreements, the corporate services agreement and any documents relating thereto.
The issuing entity's ability to incur, assume or guarantee debt will also be restricted by the trust deed, each trust deed supplement and the terms and conditions of the relevant series of notes.
Neither RBS nor NatWest owns, directly or indirectly, any of the share capital of the issuing entity.
Management's Discussion and Analysis of Financial Condition Sources of Capital and Revenue
The issuing entity's source of capital will be the net proceeds of the offering of each series of notes.
The issuing entity's primary sources of revenue will be payments of interest and principal on each series loan note acquired from the loan note issuing entity and borrowings under any series expense loan drawings as described below.
Capitalisation and Indebtedness
The capitalisation and indebtedness of the issuing entity as at 5 December 2008 is as follows:
Share Capital
Total authorised share capital ... £50,000.00 Total issued share capital... £12,501.50
Loan Capital... £0.00
There are no outstanding loans or subscriptions, allotments or options in respect of the issuing entity.
There are no guarantees or contingent liabilities in respect of the issuing entity.
The capitalisation and indebtedness of the issuing entity as set out above is correct as of 5 December 2008, however, the capitalisation and indebtedness of the issuing entity will change as new series of notes are issued from time to time. Each set of final terms will contain information regarding all series of notes issued under the programme then outstanding.
There is no goodwill in the balance sheet of the issuing entity, nor will any goodwill need to be written off upon the issue of any notes.
Results of Operations
As of the date of this base prospectus, the issuing entity does not have an operating history and has not traded. Because the issuing entity does not have an operating history, we have not included in this base prospectus any historical or pro forma ratio of earnings to fixed charges. The earnings on the loan notes acquired from the loan note issuing entity, the interest costs of the notes and the related operating expenses will determine the issuing entity's results of operations in the future. Amounts received by the issuing entity on the loan notes will be used to pay principal and interest on the corresponding series of
Litigation
The issuing entity neither is nor has been involved in any governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the issuing entity is aware) since the date of the issuing entity's incorporation on 18 November 2008 which may have, or have had in the recent past, significant effects on the issuing entity's financial position or profitability.
Financial Position
The issuing entity has not traded since its incorporation on 18 November 2008. There has been no material adverse change in the issuing entity's financial position or prospects since its date of incorporation and, since such date, there has been no significant change in the financial or trading position of the issuing entity.
The issuing entity has not commenced operations and no financial statements have been produced as at the date of this base prospectus.
Use of Proceeds
The proceeds of the issue of each series of notes (after taking into account the conversion into sterling of any other currency received with respect to the issue of the notes) will be used to purchase from the loan note issuing entity the corresponding loan note of such value and on such terms as further specified in the relevant final terms. The issuing entity will pay the fees and commissions arising from the issue of each series of notes by making a drawing under the corresponding series expense loan drawing (as defined below) of an amount at least equal to the fees and commissions payable on the notes.
Series expense loan drawings
On or prior to the issue date of the first series of notes, the issuing entity will enter into a term facility under a loan agreement (the "expenses loan agreement") made with RBS as lender, this facility being the
"expense loan facility". On the date of issuance of each series of notes (a "closing date"), the issuing entity – as borrower – may (if specified in the relevant final terms) make a drawing under the expense loan facility under which RBS will lend to the issuing entity in respect of such series an amount to be set out in the final terms corresponding to such series, to be used by the issuing entity to meet its costs and expenses relating to issuing such series of notes. Each such drawing under the expense loan facility is called a "series expense loan drawing". The amount outstanding under each series expense loan drawing will bear interest at the rate set out in the final terms corresponding to such series. The issuing entity will pay amounts due under each series expense loan drawing out of funds that would otherwise be ultimately payable to RBS from excess spread (see "Series Available Spread"). The issuing entity will pay interest to RBS on each payment date. If, on any payment date, the issuing entity has insufficient funds left after making all payments of principal and interest on the notes to pay amounts due under any series expense loan drawing, the obligation to pay the shortfall will be deferred until the next payment date.