NIG Prospectus - London Stock Exchange

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Level: 8 – From: 8 – Thursday, August 9, 2007 – 2:18 pm – mac5 – 3776 Section 03 : 3776 Section 03GENERAL DESCRIPTION OF THE PROGRAMMEThe following is an overview of the principal features of the Programme. This overview does notcontain all of the information that an investor should consider before investing in Trust Certificatesand is qualified in its entirety by the remainder of this Base Prospectus and the applicable FinalTerms. Each investor should read the entire Base Prospectus and the applicable Final Termscarefully, especially the risks of investing in the Trust Certificates issued under the Programmediscussed under “Risk Factors.”Words and expressions defined in “Form of the Trust Certificates” and “Terms and Conditions ofthe Trust Certificates” shall have the same meanings in this general description. In particular, theexpressions “Trust Deed” and “Mudarabah Agreement” mean, in relation to each Series, theMaster Trust Deed when read together with the relevant Supplemental Trust Deed and the MasterMudarabah Agreement when read together with the relevant Supplemental MudarabahAgreement, respectively.The Programme provides a facility for the issuance of Trust Certificates in Series. The terms andconditions governing each Series of Trust Certificates will be the “Terms and Conditions of theTrust Certificates” as described herein, as modified or supplemented by the applicable Final Terms.The following is an overview of the principal features of the Trust Certificates.On the occasion of each issuance of Trust Certificates, the Issuer will receive contributions fromthe Certificateholders representing the proceeds of the Trust Certificates in the amount specifiedin the relevant Supplemental Trust Deed.The Issuer (acting in its capacity as Trustee) has agreed, on each occasion on which TrustCertificates of a Series are issued, to pay an equivalent amount to the proceeds of such issue, tothe Mudarib, pursuant to the Mudarabah Agreement. Under the Mudarabah Agreement, theMudarib will apply such proceeds as capital of the mudarabah (the Mudarabah). The relevantMudarabah will commence on the Issue Date of the relevant Series of Trust Certificates and willend on (a) the later of the Maturity Date and the date on which the relevant Series of TrustCertificates is redeemed in full or (b) in the event that the relevant Series of the Trust Certificatesis redeemed in full prior to its Maturity Date, on the day immediately following such redemption.The capital of each Mudarabah will be invested by the Mudarib in accordance with an investmentplan prepared by the Mudarib and scheduled to the relevant Supplemental Mudarabah Agreement(the Investment Plan). The relevant Investment Plan will permit certain investments to be madein NIG’s general business activities and will specify the anticipated net return on the capitalinvested.The relevant Investment Plan and the terms of the relevant Mudarabah Agreement willcontemplate that the Mudarabah will generate distributable profit which shall be distributed by theMudarib on each Periodic Distribution Date in the relevant pre-agreed proportions. In theMudarabah Agreement, the Mudarib will acknowledge that the Trustee is entering into theMudarabah Agreement on the basis of the projected return set out in the relevant Investment Planand will confirm that, in its view, the relevant projected return is attainable, although it will not inany way guarantee such projected return.In relation to each Series, (i) if the distributable profit payable to the Trustee is greater than therelevant Periodic Distribution Amount, the Mudarib shall be entitled to such excess distributableprofit for its own account by way of incentive fees for acting as the Mudarib and (ii) if suchdistributable profit is less than the relevant Periodic Distribution Amount, the Mudarib shall, as aseparate and independent obligation, undertake to provide Sharia compliant funding to ensure thatsuch payments may be made. The Mudarib will be repaid such Sharia compliant funding from anyfunds that may be available on the next succeeding Periodic Distribution Date for the same Series,in accordance with the priority of payments in Condition 5.2.18
Level: 8 – From: 8 – Thursday, August 9, 2007 – 2:18 pm – mac5 – 3776 Section 03 : 3776 Section 03The Obligor has agreed to purchase the Trustee’s rights, benefits and entitlements in and to theRelevant Mudarabah Assets on the relevant Maturity Date or, as the case may be, on the relevantDissolution Date pursuant to a purchase undertaking deed dated on or about 13 August 2007executed by the Obligor (the Purchase Undertaking), to be supplemented, at the time of eachsuch purchase, by a Sale Agreement (each a Sale Agreement) substantially in the form annexedto the Purchase Undertaking and containing the specific terms applicable to the relevant purchase.In addition, in any case where the Issuer is entitled to require the redemption of the TrustCertificates of any Series, the Obligor has the right to purchase the Trustee’s rights, benefits andentitlements in and to the Relevant Mudarabah Assets on the relevant Distribution Date pursuantto a sale undertaking deed dated on or about 13 August 2007 executed by the Issuer (the SaleUndertaking), to be supplemented, at the time of each such purchase, by a Sale Agreement (eacha Sale Agreement) substantially in the form annexed to the Sale Undertaking and containing thespecific terms applicable to the relevant purchase. The price payable by the Obligor pursuant toeach Sale Agreement will be an amount equal to (a) the Aggregate Face Amount (as specified inthe applicable Final Terms) of the relevant Series of Trust Certificates, (b) the amount of accruedand payable but unpaid Periodic Distribution Amounts on such date (including any additionalamounts payable pursuant to Condition 12 and (c) all amounts due to the Mudarib in respect ofany Sharia compliant funding advanced by it (but which has not been repaid) pursuant to the termsof the Mudarabah Agreement. The Trustee will distribute the proceeds of sale of the Issuer’srights, benefits and entitlements in and to the Relevant Mudarabah Assets to Certificateholders ofthe relevant Series in the manner provided in the Conditions or as otherwise specified in theapplicable Final Terms.Pursuant to the Trust Deed the Issuer (acting in its capacity as Trustee) will declare a trust (a Trust)over all of its rights, benefits and entitlements in and to the Relevant Mudarabah Assets and eachof the other Transaction Documents (other than in relation to any representations given to theIssuer by the Obligor or the relevant Mudarib pursuant to any of the other Transaction Documents)and any amounts it may have deposited in the Transaction Account for the relevant Series of TrustCertificates, subject to the terms of the relevant Supplemental Trust Deed.The Issuer will act as trustee in respect of the Trust Assets for the benefit of Certificateholders ofeach Series in accordance with the Trust Deed and the Conditions. Under the Master Trust Deed,the Issuer will, with effect from and including the date of the Master Trust Deed and save in certainlimited respects only, unconditionally and irrevocably delegate all of the present and future duties,powers, trusts, authorities and discretions vested in the Trustee under the Trust Deed to theDelegate.Following the distribution of the relevant Trust Assets to the Certificateholders of any Series inaccordance with the Conditions and the Trust Deed, the Trustee shall not be liable for any furthersums, and accordingly those Certificateholders may not take any action against the Trustee or anyother person to recover any such sum in respect of the relevant Trust Certificates or the relevantTrust Assets.The Trustee shall not be bound in any circumstances to take any action to enforce or to realise suchTrust Assets or take any action against NIG under any Transaction Documents unless directed orrequested to do so by the relevant Certificateholders in accordance with the Conditions, and thenonly to the extent indemnified and/or secured to its satisfaction.No Certificateholder shall be entitled to proceed directly against NIG unless (i) the Trustee, havingbecome bound so to proceed, fails to do so within 30 days of becoming so bound and such failureis continuing and (ii) the relevant Certificateholder (together with the other Certificateholders ofthe same Series who propose to proceed directly against NIG) holds at least one-fifth of theaggregate face amount of the relevant Series of Trust Certificates then outstanding.The foregoing is subject to the following: in relation to each Series after enforcing or realising theTrust Assets and distributing the net proceeds of the Trust Assets in accordance with Condition5.2, the obligations of the Trustee in respect of the Trust Certificates shall be satisfied and no19
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NIG Prospectus - London Stock Exchange

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