Titan Europe 2007-1 (NHP) Limited - Irish Stock Exchange

DESCRIPTION OF THE SWAP TRANSACTIONS
Swap Transactions
The Libra Whole Loan is a floating rate mortgage loan. The Borrower has entered into an agreement with
Credit Suisse International (the “Swap Provider”) in the form of an ISDA 1992 Master Agreement (the “Swap
Agreement”). Pursuant to the Swap Agreement the Borrower has entered into the following swap transactions,
each documented by respective confirmations:
• One interest rate swap transaction for an aggregate notional amount of £1,172,000,000 and having an
effective date of 15 January 2007 and a termination date of 15 January 2010 (the “Spot Swap”); and
• One forward interest rate swap transaction for an aggregate notional amount of £1,172,000,000 and
having an effective date of 15 January 2010 and a termination date of 15 January 2017 (the “Forward
Swap”),
(each of the Spot Swap and the Forward Swap, a “Swap Transaction” and collectively, the “Swap
Transactions”). The termination date of the Spot Swap is the date on which the Libra Whole Loan would
mature if the option to extend the maturity by one year from 15 January 2009 were to be exercised. The
Forward Swap terminates on the Maturity Date of the Notes.
In addition, on or before the Closing Date, the Issuer will enter into a swap agreement with the Swap
Provider in the form of the ISDA 1992 Master Agreement (Multicurrency-Cross Border) (the “Basis Swap
Agreement”). In relation to the Basis Swap Agreement, the Swap Provider has entered into a swap
confirmation with respect to the Libra Loan (the “Basis Swap Confirmation”) evidencing the terms of such
swap transaction (the “Basis Swap Transaction”), pursuant to which the Issuer will swap LIBOR as calculated
on the reset date for amounts payable under the Libra Loan for LIBOR as calculated on the reset date for
amounts payable in respect of the Notes. The Basis Swap Confirmation has an effective date of 15 April 2007
and a termination date of 20 January 2010.
Subject to the following, the Swap Provider is obliged only to make payments under the Basis Swap
Transaction to the extent that the Issuer makes the corresponding payments thereunder. Furthermore, a failure
by the Issuer to make timely payment of amounts due from it under the Basis Swap Transaction will constitute a
default in respect of the relevant payment due under the relevant Basis Swap Transaction if such failure is not
remedied on or before the third Business Day in respect of the Basis Swap Transaction following notice of such
non-payment and entitle the relevant Swap Provider to terminate the Basis Swap Transaction.
Depending on LIBOR at the relevant time(s), a payment may be due from the Issuer or the Borrower, as
applicable, to the Swap Provider in connection with a termination or partial termination of a Swap Transaction
or vice versa (a “Swap Termination Payment” and, with respect to the Spot Swap, the “Spot Swap
Termination Payments”; and with respect to the Forward Swap, the “Forward Swap Termination
Payments”). Any such Swap Termination Payment due to the Swap Provider in respect of the Swap
Transaction entered into in respect of the Libra Whole Loan will be applied in the manner described in “The
Structure of the Accounts” above. To the extent not paid by the Issuer or the Borrower, as applicable, Swap
Termination Payments (other than Swap Subordinated Amounts) and payment of amounts or expenses due and
payable to the Swap Provider, but excluding Forward Swap Subordinated Amounts, will be made in priority to
all other payments required to be made by the Issuer on any day such payments are due as a Revenue Priority
Amount. Forward Swap Subordinated Amounts are subordinated and are paid after payment of interest and
principal on the Class A Notes and the Class X Notes (as to interest only). The amount of any Swap
Termination Payment will depend upon current market rates at the time of termination of the Swap Agreement
and can be substantial.
“Forward Swap Subordinated Amounts” means any amount due to the Swap Provider under the Swap
Agreement to the extent relating to the Forward Swap (but does not include Swap Subordinated Amounts).
“Swap Subordinated Amounts” means any termination amount due to the Swap Provider as a result of a Swap
Trigger or as a result of termination due to the occurrence of a Tax Event Upon Merger (as defined in the Swap
Agreement). “Swap Trigger” means: (a) the occurrence of an Event of Default (as defined in the Swap
Agreements) in respect of the Swap Provider; (b) the failure by the Swap Provider to comply with the
requirements under the Swap Agreements in relation to loss of any Minimum Swap Provider Ratings; or (c) the
occurrence of a Credit Event Upon Merger (as defined in the Swap Agreements) with regard to the Swap
Provider.
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