iesy Repository GmbH - Irish Stock Exchange

TAX CONSIDERATIONS
The following is a summary based on present law of certain German and U.S. federal income tax considerations for
prospective purchasers of the Notes. It addresses only purchasers that buy in the original offering at the original offering price
and, in the case of a U.S. Holder (as defined below), that hold the Notes as capital assets and use the U.S. dollar as their
functional currency and, in the case of German-resident Noteholders, that use the Euro as their functional currency. The
discussion does not consider the circumstances of particular purchasers subject to special tax regimes, such as banks,
insurance companies, dealers, tax exempt organizations or persons holding the Notes as part of a hedge, straddle, conversion,
integrated or constructive sale transaction. The discussion is a general summary only; it is not a substitute for tax advice.
EACH PROSPECTIVE PURCHASER SHOULD SEEK ADVICE FROM AN INDEPENDENT TAX ADVISOR
ABOUT THE TAX CONSEQUENCES UNDER ITS OWN PARTICULAR CIRCUMSTANCES OF INVESTING IN
OFFERED SECURITIES UNDER THE LAWS OF GERMANY, THE UNITED STATES AND ITS CONSTITUENT
JURISDICTIONS AND ANY OTHER JURISDICTION WHERE THE PURCHASER MAY BE SUBJECT TO
TAXATION.
As used here, “Noteholder” means a beneficial owner of a Note. A “U.S. Holder” is a Holder that for U.S. federal
income tax purposes is (i) a citizen or resident of the United States, (ii) a corporation, partnership or other entity organized in
or under the laws of the United States or its political subdivisions, (iii) a trust subject to the control of a U.S. person and the
primary supervision of a U.S. court or (iv) an estate the income of which is subject to U.S. federal income taxation regardless
of its source.
German Tax Considerations
Prospective purchasers of Notes are advised to consult their own tax advisors for the tax consequences of the
purchase, the ownership and the disposition of Notes, including the effect of any state or local taxes under the tax laws
of the Federal Republic of Germany as well as of any other country of which they are residents.
Tax Residents
Interest Payments
Interest, including any Additional Amounts, received by a Noteholder resident in Germany (e.g. a person whose
residence, habitual abode, statutory seat, or place of effective management and control is located in Germany) is subject to
German personal or corporate income tax. On the basis of the assessed personal or corporate income tax, a solidarity
surcharge (Solidaritätszuschlag) of 5.5% is levied. In addition, if Notes are held as assets of a German commercial business,
any interest received is subject to trade tax. Accrued interest (Stückzinsen) paid upon the acquisition of Notes may give rise to
negative income and may, therefore, reduce a Noteholder’s personal tax liability.
If Notes are held in a custodial account that the Noteholder maintains with the German branch of a German or non-
German bank or financial services institution (the “Disbursing Agent”—inländische Zahlstelle), such Disbursing Agent will
withhold tax (Zinsabschlag) at a rate of 30% of the gross amount of all interest payments to the Noteholder plus 5.5%
solidarity surcharge (Solidaritätszuschlag) thereon. As a result, 31.65% of the gross amount of interest paid to a Noteholder
will be withheld by the Disbursing Agent. The tax withheld by the Disbursing Agent will be credited against the Noteholder’s
total annual tax burden for German personal or corporate income tax purposes.
No tax will be withheld by the Disbursing Agent, if the Noteholder is an individual who has filed a certificate of
exemption (Freistellungsauftrag) with the Disbursing Agent and the Notes held by such individual neither form part of a
German business property nor generate income from the letting and leasing of property. However, this exemption applies
only to the extent that the aggregate of (i) the interest income derived from the Notes and (ii) the individual’s other
investment income administered by the Disbursing Agent does not exceed the maximum annual exemption amount shown on
the certificate of exemption (up to €1,370 for individuals and €2,740 for married couples filing jointly) plus the flat
deductible expense allowance (€51 for individuals and €102 for married couples filing jointly). Furthermore, no tax will be
withheld, if the Noteholder submits a certificate of non-assessment (Nichtveranlagungsbescheinigung) issued by the local tax
office to the Disbursing Agent.
Sale or Redemption of Notes
In the Issuer’s view, the Notes qualify as financial innovation under German tax law. Accordingly, gains, including any
Additional Amounts, from the sale or redemption of Notes, including gains derived by a secondary or subsequent purchaser,
are considered to constitute interest income and are subject to personal or corporate income tax, increased by the 5.5%
solidarity surcharge thereon. If Notes are held as assets of a German commercial business, such gains are, in addition, subject
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