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

contained in the Security Agreements contemplate that, following a default, notice would be served on the
Tenants of a Property requiring all further rents to be paid directly to the Issuer. This could result in the relevant
Security Agent (or the Note Trustee if it has taken enforcement action against the Issuer) becoming a mortgagee
or heritable creditor in possession.
A mortgagee or heritable creditor in possession has an obligation to account for the income obtained from
the relevant Property and in the case of tenanted property will be liable to a Tenant for any mismanagement of
the relevant Property. A mortgagee or heritable creditor in possession may also incur liabilities to third parties
in nuisance and negligence and, under certain statutes (including environmental legislation), can incur the
liabilities of a property owner.
In a case where it is necessary to initiate enforcement procedures against the Borrower, the Special Servicer
is likely to appoint a receiver to collect the Rental Income on behalf of the Issuer in respect of Properties located
in England and Wales, which should have the effect of reducing the risk that either the Issuer or the Note
Trustee is deemed to be a mortgagee or heritable creditor in possession. If the Special Servicer does not choose
to enforce (or cannot enforce due to applicable law, as is the case in Scotland) via a receiver, the Note Trustee
has the absolute discretion, at any time, to serve a written notice on the Special Servicer requiring the Special
Servicer to obtain the Note Trustee’s prior written consent before taking any action which would be likely to
lead to the Security Agent or the Note Trustee becoming a mortgagee or heritable creditor in possession in
respect of a Property.
Risks Relating to Security Trusts: The Related Security for the Libra Loan is held on trust for, among
others, the lenders, by Credit Suisse, London Branch. There is a risk that, in any insolvency proceedings
undertaken in relation to Credit Suisse, London Branch which are conducted in a jurisdiction other than England
and Wales, Scotland or Northern Ireland, the courts of the relevant jurisdiction may not recognise the security
trusts and may consider the assets which are subject to the security trusts as forming part of Credit Suisse,
London Branch’s estate. On the Closing Date, the Issuer will receive a legal opinion in relation to, among other
matters, the efficacy of the security trusts as a matter of Swiss law.
Enforcement; Receivers under English Law: A receiver (an “LPA Receiver”) appointed to enforce a fixed
charge over real property granted by a company or an individual is usually appointed under the provisions of the
Law of Property Act 1925 (“LPA”) and derives his powers from both the LPA and the charge instrument. An
LPA Receiver’s powers are limited under statute to the powers to demand, recover and receive the income of
property over which they have been appointed as receiver, but such powers are usually extended by the charge
instrument and typically include the express power to take possession of the charged assets. Alternatively
receivers may be appointed in respect of other fixed charge assets, their rights and powers deriving from the
charge instrument.
Where a receiver is appointed over the whole or substantially the whole of a company’s property by a
secured lender under a charge which, as created, is a floating charge, or under such a charge and one or more
other securities, the receiver is known as an “administrative receiver”, and has extensive powers, including the
power to take possession of all charged assets and run the business of the company. As a result of the
amendments to the Insolvency Act made pursuant to the Enterprise Act (see “—Enterprise Act 2002”, below),
subject to limited exceptions, holders of floating charges created after 15 September 2003 are not able to appoint
administrative receivers, and instead must enforce their security rights through an administration of the chargor.
One of the exceptions contained in the amended Insolvency Act allows the continued appointment of an
administrative receiver in relation to certain transactions in the capital markets. The relevant exception provides
that the appointment of an administrative receiver is not prohibited if it is made in pursuance of an agreement
which is or forms part of a capital markets arrangement (as defined in the Insolvency Act) under which a party
incurs or, when such agreement was entered into was expected to incur, a debt of at least £50 million under the
arrangement and the arrangement involves the issue of a capital market investment (also defined, but generally a
rated, listed or traded debt instrument). It is expected that the Libra Whole Loan and the security that the Issuer
will grant to the Note Trustee will each fall within the capital markets exception. However, it should be noted
that there have been no decisions made by the UK courts on the interpretation of the relevant provisions of the
Insolvency Act, and further, that the relevant Secretary of State may, by secondary legislation, modify the
capital market exception and/or provide that the exception shall cease to have effect. No assurance can be given
that any such later interpretation of or modification or provision in respect of the capital market exception, or its
ceasing to be applicable to the transactions described in this Prospectus, will not be detrimental to the interests
of the Noteholders.
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