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

profits or losses could arise in the Issuer as a result of the application of IFRS or current Irish GAAP that are not
contemplated in the cashflows for the transaction and as such may have a negative effect on the Issuer and its
ability to make payments to Noteholders. The Issuer has covenanted that, if its cashflows would thereby be
affected adversely, no such election will be made.
Withholding Tax Under the Notes: In the event any withholding or deduction for or on account of taxes is
imposed on or is otherwise applicable to payments of interest or principal on the Notes to Noteholders the Issuer
is not obliged to gross-up or otherwise compensate Noteholders for the lesser amounts the Noteholders will
receive as a result of such withholding or deduction.
European Union Directive on Taxation of Savings Income: Under the EC Council Directive 2003/48/EC on
the taxation of savings income, Member States are required to provide to the tax authorities of another Member
State details of payments of interest (or similar income) paid by a person within its jurisdiction to an individual
resident in that other member state (the member states constituting the European Union, collectively the
“Member States” and each a “Member State”). However, for a transitional period, Belgium, Luxembourg and
Austria are instead required (unless during that period they elect otherwise) to operate a withholding system in
relation to such payments (the ending of such transitional period being dependent upon the conclusion of certain
other agreements relating to information exchange with certain other countries). A number of non-EU countries
and territories including Switzerland have agreed to adopt similar measures (a withholding system in the case of
Switzerland) with effect from the same date. If a payment were to be made or collected through a Member State
which has opted for a withholding system and an amount of, or in respect of, tax were to be withheld from that
payment, neither the relevant Issuer nor any Paying Agent nor any other person would be obliged to pay
additional amounts with respect to any Note as a result of the imposition of such withholding tax. The Issuer is
required to maintain a Paying Agent in a Member State that will not be obliged to withhold or deduct tax
pursuant to this Directive.
Introduction of the Euro: It is possible that, prior to the maturity of the Notes, the United Kingdom may
become a participating member state in the European Economic and Monetary Union and therefore the euro
may become the lawful currency of the United Kingdom. In that event, all amounts payable in respect of the
Notes denominated in sterling may become payable in euro and applicable provisions of law may require or
allow the Issuer to redenominate each Class of sterling denominated Notes in euro and take additional measures
in respect of such Notes. The introduction of the euro as the lawful currency of the United Kingdom may result
in the disappearance of published or displayed rates for deposits in sterling used to determine the rates of
interest on sterling denominated Notes, or changes in the way those rates are calculated, quoted, published or
displayed. The introduction of the euro could also be accompanied by a volatile interest rate environment which
could adversely affect Noteholders. It cannot be said with certainty what effect the adoption of the euro by the
United Kingdom (if it occurs) would have on investors in the Notes.
Implementation of the Basel II Framework: On 26 June 2004, the Basel Committee on Banking
Supervision (the “Basel Committee”) published the text of a new capital accord under the title Basel II:
International Convergence of Capital Measurement and Capital Standards: a Revised Framework (“Basel II”); a
revised version was published on 15 November 2005. Basel II replaces the 1988 Basel Capital Accord and
places enhanced emphasis on risk-sensitivity and market discipline. The Basel Committee has suggested that
the various approaches under the Framework should be implemented in stages, some from year-end 2006; the
most advanced at year-end 2007. National implementation dates may differ depending on the relevant
implementation process. If implemented in accordance with its current form, Basel II could affect the risk
weighting of the Notes in respect of investors which are subject to Basel II in the form of any national
legislative implementation thereof including, in respect of EU financial institution investors, via the proposed
directive, comprising the Directive 2006/48/EC of the European Parliament and of the Council of 14 June 2006
relating to the taking up and pursuit of the business of credit institutions and the Directive 2006/49/EC of the
European Parliament and of the Council of 14 June 2006 on the capital adequacy of investment firms and credit
institutions (the “Capital Requirements Directive”). Consequently, investors should consult their own
advisors as to the consequences to and effect on them of the proposed national implementation of Basel II. No
predictions can be made by the Issuer as to the precise effects of potential changes which might result if Basel II
is adopted in its current form or otherwise.
United States Tax Characterisation of the Notes: Although the Notes are denominated as debt, there is a
significant possibility that one or more classes of Notes may be treated as equity for United States federal
income tax purposes. Such a characterisation could have certain adverse tax consequences to United States
investors who hold such Notes. Noteholders who are United States persons should carefully review the
discussion of U.S. federal income tax consequences in “United States Taxation—Possible Alternative
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