pdf, 1996K - WestLB

Partly-paid Instruments
The Issuer may issue Instruments where the issue price is payable in more than one instalment. Failure to pay any
subsequent instalment could result in an investor losing all of its investment.
Floating Rate Instruments with a Multiplier or Other Leverage Factor
Instruments with floating interest rates can be volatile investments. If they are structured to include multipliers or other
leverage factors, or caps or floors, or any combination of those features, their market values may be even more volatile
than those for securities that do not include those features.
Inverse Floating Rate Instruments
Inverse Floating Rate Instruments have an interest rate equal to a fixed interest rate minus an interest rate based upon a
reference interest rate such as EURIBOR or LIBOR. The market values of those Instruments typically are more volatile
than market values of other conventional floating rate debt securities based on the same reference interest rate (and with
otherwise comparable terms). Inverse Floating Rate Instruments are more volatile because an increase in the reference
interest rate not only decreases the interest rate of the Instruments, but may also reflect an increase in prevailing interest
rates, which further adversely affects the market value of these Instruments.
Fixed/Floating Rate Instruments
Fixed/Floating Rate Instruments may bear interest at a rate that converts from a fixed interest rate to a floating interest
rate, or from a floating interest rate to a fixed interest rate. Where the Issuer has the right to effect such conversion, this
will affect the secondary market and the market value of the Instruments since the Issuer may be expected to convert the
rate when it is likely to produce a lower overall cost of borrowing. If the Issuer converts from a fixed interest rate to a
floating interest rate, the spread on the Fixed/Floating Rate Instruments may be less favourable than the spreads then
prevailing on comparable Floating Rate Instruments tied to the same reference interest rate. In addition, the new floating
interest rate at any time may be lower than the interest rates on other Instruments. If the Issuer converts from a floating
interest rate to a fixed interest rate in such circumstances, the fixed interest rate may be lower than then prevailing
interest rates on its Instruments.
Instrument Issued at a Substantial Discount or Premium
The market values of debt securities issued at a substantial discount or premium from their principal amount tend to
fluctuate more in relation to general changes in interest rates than do prices for conventional interest-bearing debt
securities. Generally, the longer the remaining term of the debt securities, the greater the price volatility as compared to
conventional interest-bearing debt securities with comparable maturities.
Target Redemption Instruments
The automatic redemption feature of Target Redemption Instruments may limit their market value. Due to the overall
maximum amount of interest paid under Target Redemption Instruments, even in a favourable market/interest
environment their market value may not rise substantially above the price at which they can be redeemed.
The automatic redemption may take place when the cost of borrowing is generally lower than at the issue date of the
Instruments. At those times, an investor generally would not be able to reinvest the redemption proceeds at an effective
interest rate as high as the interest rate on the Target Redemption Instruments being redeemed and may only be able to
do so at a significantly lower rate. Potential investors should consider reinvestment risk in light of other investments
available at that time.
Credit Linked Instruments
The value of any Instruments linked to the credits of reference entities (the Reference Entities) may vary over time in
accordance with the credit of the Reference Entities. An investment in Credit Linked Instruments involves a high degree
of risk. In the event of the occurrence of a "Credit Event" (as set out in the relevant Final Terms) (the Credit Event) in
respect of any one or more Reference Entities, the Issuer may redeem the Instruments either by delivering to Holders
certain "Deliverable Obligations" (as set out in the relevant Final Terms) (the Deliverable Obligations) of any such
Reference Entity that has suffered a Credit Event in full satisfaction of its obligations under the Instruments or, if "Cash
Settlement" is specified in the relevant Final Terms, by the payment of an amount of cash as determined in accordance
with the provisions of the relevant Final Terms. In certain circumstances, the Instruments may cease to bear interest
and, on redemption, the investor may be repaid nothing. Credit Linked Instruments may not benefit from the same
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