EUROHOME (ITALY) MORTGAGES S.R.L. - ise.ie home_10126.pdfClass Z Mortgage Backed Fixed Rate and ... Eurohome (Italy) Mortgages S.r.l. ... the linear interpolation of the arithmetic

ITA80503

EUROHOME (ITALY) MORTGAGES S.R.L.(incorporated with limited liability under the laws of the Republic of Italy)

Notes Initial PrincipalAmount

ReferenceRate

Margin%

MaturityDate

IssuePrice

Ratings(Moody’s/S&P)*

Class A Mortgage Backed Floating RateNotes 211,950,000 3-month Euribor 0.60 November 2054 100.00% Aaa / AAA

Class B Mortgage Backed Floating RateNotes 15,900,000 3-month Euribor 0.90 November 2054 100.00% Aa2 / AA

Class C Mortgage Backed Floating RateNotes 11,550,000 3-month Euribor 1.35 November 2054 100.00% A1 / A

Class D Mortgage Backed Floating RateNotes 7,200,000 3-month Euribor 3.25 November 2054 100.00% Baa2 / BBB-

Class E Mortgage Backed Floating RateNotes 10,300,000 3-month Euribor 3.75 November 2054 100.00% B3 / N.A.

Class Z Mortgage Backed Fixed Rate andVariable Return Notes 3,950,000 N/A N/A November 2054 100.00% None

* A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning rating organisation. For a discussion ofcertain risk and other factors that should be considered in connection with an investment in the Rated Notes, see section headed “Risk Factors”.

Application has been made to the Irish Financial Services Regulatory Authority (the “IFSRA”), as competent authority under Directive 2003/71/EC (the“Prospectus Directive”), for the Prospectus to be approved. Eurohome (Italy) Mortgages S.r.l. (the “Issuer”), a limited liability company incorporated underthe laws of the Republic of Italy and established as a special purpose vehicle for the purposes of engaging in the issue of mortgage backed notes inaccordance with Law 130 of 30 April 1999 (the “Securitisation Law”), will issue on or about 21 December 2007 (the “Issue Date”) the Euro 211,950,000Class A Mortgage Backed Floating Rate Notes due November 2054 (the “Class A Notes”), the Euro 15,900,000 Class B Mortgage Backed Floating RateNotes due November 2054 (the “Class B Notes”), the Euro 11,550,000 Class C Mortgage Backed Floating Rate Notes due November 2054 (the “Class CNotes”), the Euro 7,200,000 Class D Mortgage Backed Floating Rate Notes due November 2054 (the “Class D Notes”) and the Euro 10,300,000 Class EMortgage Backed Floating Rate Notes due November 2054 (the “Class E Notes” and, together with the Class A Notes, the Class B Notes, the Class C Notesand the Class D Notes, the “Rated Notes”) in accordance with the Securitisation Law. In connection with the issue of the Rated Notes, the Issuer will alsoissue the Euro 3,950,000 Class Z Mortgage Backed Fixed Rate and Variable Return Notes due November 2054 (the “Class Z Notes” and, together with theRated Notes, the “Notes”). Application has been made to the Irish Stock Exchange Limited (the “Irish Stock Exchange”) for the Rated Notes to be admittedto the Official List of the Irish Stock Exchange (the “Official List”). There can be no assurance that any such listing will be obtained or maintained. Noapplication has been made to list the Class Z Notes on any stock exchange. Approval of the IFSRA relates only to the Rated Notes which are to beadmitted to trading on the regulated market of the Irish Stock Exchange or other regulated markets for the purpose of Directive 2004/39/EC orwhich are to be offered to the public in any Member State of the European Economic Area. This prospectus constitutes a Prospectus issued incompliance with the Prospectus Directive in respect of the Rated Notes and a “Prospetto Informativo” for the purposes of Article 2, paragraph 3 of theSecuritisation Law in respect of all Notes.The Notes will be issued in denominations of Euro 50,000. The Notes will be held in dematerialised form on behalf of the ultimate owners, until redemptionor cancellation thereof, by Monte Titoli S.p.A. (“Monte Titoli”) for the account of the relevant Monte Titoli Account Holders. The expression “Monte TitoliAccount Holders” means any authorised financial intermediary institution entitled to hold accounts on behalf of their customers with Monte Titoli andincludes Clearstream Banking S.A. (“Clearstream”) and Euroclear Bank S.A./N.V., as operator of the Euroclear System (“Euroclear”). Monte Titoli shallact as depository for Clearstream and Euroclear. Title to the Notes will at all times be evidenced by book-entries in accordance with the provisions of Article28 of Italian Legislative Decree No. 213 of 24 June, 1998 and with Resolution No. 11768 of 23 December, 1998 of the Commissione Nazionale per leSocietà e la Borsa (“CONSOB”) as amended from time to time. No physical document of title will be issued in respect of the Notes.Each Note will bear interest on its Principal Amount Outstanding (as defined in the terms and conditions of the Notes (the “Conditions”)) subject to and inaccordance with Condition 6 (Right to Interest) from and including the Issue Date until its due date for redemption as provided in Condition 7 (Redemption,Purchase and Cancellation).Interest on the Notes will be payable by reference to successive interest periods (each an “Interest Period”) in arrears in Euro on 2 May 2008 and thereafterquarterly on the 2 Business Day of February, May, August and November in each year (each such day being a “Payment Date”), provided that a “BusinessDay” shall be a day (other than a Saturday or a Sunday) on which banks and foreign exchange markets are open for business in Milan, Dublin and Londonand on which the Trans-European Automated Real Time Gross Settlement Express Transfer (TARGET) System (or any successor thereto) is open forbusiness, subject to the Conditions, including the interest deferral and limited recourse provisions thereof. Each Interest Period will commence on (andinclude) a Payment Date (or, in the case of the first Interest Period, the Issue Date) and end on (but exclude) the next succeeding Payment Date (or, in thecase of the first Interest Period, the Payment Date falling in May 2008).Interest will accrue on the Principal Amount Outstanding of each Class of Rated Notes at an annual rate (the “Rate of Interest”) equal to the sum of the rateoffered in the euro-zone inter-bank market (as determined in accordance with Condition 6(b), “Euribor”) for three-month Euro deposit (or, in the case of thefirst Interest Period, the linear interpolation of the arithmetic mean between four-month and five-month Euro deposits) plus: (i) a margin of 0.60 per cent. perannum in respect of the Class A Notes, (ii) a margin of 0.90 per cent. per annum in respect of the Class B Notes, (iii) a margin of 1.35 per cent. per annum inrespect of the Class C Notes, (iv) a margin of 3.25 per cent. per annum in respect of the Class D Notes and (v) a margin of 3.75 per cent. per annum inrespect of the Class E Notes. Interest will accrue on the Principal Amount Outstanding of the Class Z Notes at a fixed Rate of Interest of 2 per cent. perannum. In addition, subject to and in accordance with the Conditions, each holder of a Class Z Note shall be entitled on each Payment Date to a pro ratashare of the aggregate amount (if any) available under the applicable Priority of Payments to be paid as Variable Return (as defined herein).

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Payments under the Notes may or may not be subject to withholding for or on account of tax, in accordance with Italian Law No. 239 of 1 April 1996, asamended and supplemented. Upon the occurrence of any withholding for or on account of tax from any payments under the Notes, neither the Issuer nor anyother person shall have any obligation to pay any additional amount(s) to any holder of a Note of any Class.Provided no Issuer Enforcement Notice has been served and no Issuer Insolvency Event (each as defined herein) has occurred, the Notes will start toamortise on the Payment Date falling in August 2009. Repayments of principal on the Notes will be effected subject to there being Available Funds and inaccordance with the applicable Priority of Payments (as defined herein).Upon the occurrence of certain tax or regulatory events, and subject to certain conditions as set out in Condition 7(c) (Redemption, Purchase andCancellation – Redemption for Tax or Regulatory Event), the Issuer shall, on a Payment Date, redeem all but not some only of the Notes at their PrincipalAmount Outstanding together with accrued but unpaid interest up to and including such Payment Date, and shall be entitled to sell the Portfolio (as definedbelow) for the purpose of funding such redemption. At any time after the later of the expiry of the Initial Period and the Payment Date on which theaggregate principal amount outstanding of the Portfolio is equal to or less than 10% of the Initial Principal Amount of the Portfolio, the Issuer may redeemall, but not some only of, the Notes at their Principal Amount Outstanding (plus any accrued but unpaid interest) in accordance with the Enforcement Priorityof Payments and subject to the Issuer having sufficient funds to redeem all the Notes and to make all payments ranking in priority thereto, or pari passutherewith, on any Payment Date, in accordance with Condition 7(d) (Early redemption by the Issuer). Prior to the service of an Issuer Enforcement Notice orthe occurrence of an Issuer Insolvency Event, each Put Option Noteholder shall have the option (a “Put Option”) to offer all (but not only part of) the RatedNotes held by it to the Issuer for redemption at their Redemption Value on the Payment Date falling in February 2015 (the “First Put Date”) and eachPayment Date thereafter (each a “Put Date”) and, subject to a number of Put Option Noteholders at least equal to the Put Option Quorum having exercisedthe Put Option, the Notes will be redeemed on the First Put Date or later Put Date at their Redemption Value in accordance with Condition 7 (e) (Redemptionof the Notes at the option of the Put Option Noteholders). Unless previously redeemed in full, the Notes will mature on the Payment Date falling inNovember 2054.The principal source of payment of interest and repayment of principal on the Notes is from collections made in respect of a pool of claims and connectedrights arising from performing residential mortgage loans and, to a very limited extent, performing commercial mortgage loans (mutui fondiari andipotecari), secured on certain properties in Italy, originated by Deutsche Bank Mutui S.p.A. (the “Originator”) that are, and during the Revolving Period (asdefined below) will be, purchased by the Issuer from the Originator pursuant to the terms of a master receivables transfer agreement (the “Master TransferAgreement”) entered into between the Issuer, the Originator and the Representative of the Noteholders on 12 December 2007, as amended on 20 December2007. Pursuant to the Master Transfer Agreement, the Issuer purchased pro soluto from the Originator, which sold and transferred, the Initial Pool witheconomic effect from 19 November 2007, and shall purchase from the Originator, subject to the terms and conditions set out therein, additional pools ofmonetary receivables arising out of Italian law governed performing residential mortgage loans and, to a very limited extent, Italian law governed performingcommercial mortgage loans (mutui fondiari and ipotecari) secured on certain properties in Italy, pursuant to the Italian Securitisation Law (hereinafter, the“Additional Pools”, and together with the Initial Pool, the Portfolio), selected on the basis of objective criteria equal to the selection criteria used in respectof the Initial Pool and, where necessary, supplemented by the Specific Criteria (respectively, the “Initial Criteria” and the “Additional Criteria”, andtogether referred as the “Criteria”) so as to ensure economic and legal homogeneity of the Loan Receivables comprised in the Portfolio. The purchase pricepayable by the Issuer in respect of the Initial Pool shall be equal to the principal amount outstanding of the Loan Receivables comprised in the Initial Pool asat the Initial Cut-Off, subject to and in accordance with the Master Transfer Agreement. The purchase price payable by the Issuer in respect of the LoanReceivables comprised in any Additional Pool shall be equal to the principal amount outstanding of the Loan Receivables comprised in such Additional Poolas at the relevant Cut-Off Date and shall be payable in accordance with the Pre-Enforcement Principal Priority of Payments.The Notes will be direct and limited recourse obligations solely of the Issuer secured over certain assets of the Issuer as described in the sections headed“Summary of the Transaction Documents”. Security will not be granted over the Portfolio or the Collections (as defined herein) deriving from the Portfolio.By operation of Italian law, the Issuer’s right, title and interest in and to the Portfolio will be segregated from all other assets of the Issuer and the Portfolioand any Collections in respect of the Portfolio, once received by the Issuer, will only be available to satisfy the obligations of the Issuer to the holders of theNotes (the “Noteholders”), the Other Issuer Secured Creditors and the Connected Third Party Creditors (each as defined herein). The Issuer will grantsecurity over certain rights and claims arising out of the Transaction Documents (as defined herein) pursuant to a Pledge Agreement and a Deed of Charge(the “Issuer Security”). Upon enforcement, recourse under the Notes will be limited to the proceeds of the Portfolio and the Issuer Security. The IssuerSecured Creditors will agree or, in the case of the Noteholders, the Conditions will provide and the Noteholders will be deemed to have agreed that amountsderiving from the Portfolio will be applied by the Issuer in accordance with the applicable Priority of Payments (each as defined herein).

Arranger and Lead Manager

Deutsche Bank AG

The date of this Prospectus is 20 December 2007

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Responsibility for Information

The Issuer accepts responsibility for the information contained in this Prospectus, other than information forwhich DB Mutui, Deutsche Bank AG and Deutsche Bank S.p.A. accept responsibility in the paragraphsidentified below. To the best of the knowledge and belief of the Issuer (which has taken all reasonable careto ensure that such is the case) the information contained in this Prospectus is in accordance with the factsand does not omit anything likely to affect the import of such information.

None of the Issuer, the Representative of the Noteholders, the Lead Manager, the Arranger and theBookrunner or any other party to the Transaction Documents other than DB Mutui has undertaken nor willundertake any investigations, searches or other actions to verify the details of the Loan Receivablestransferred or to be transferred by the Originator to the Issuer, nor have the Issuer, the Representative of theNoteholders, the Lead Manager, the Arranger and the Bookrunner or any other party to the TransactionDocuments other than DB Mutui undertaken, nor will they undertake, any investigations, searches or otheractions to establish the creditworthiness of any Obligor in respect of the Receivables.

DB Mutui accepts responsibility for the information included in this Prospectus in the sections headed “ThePortfolio”, “The Originator”, and any other information contained in this Prospectus relating to itself, itsbusiness and assets, the origination and collection procedures applicable to the Portfolio, the LoanReceivables, the Loans, the Related Security and the Insurance Policies. To the best of the knowledge andbelief of DB Mutui (which has taken all reasonable care to ensure that such is the case), such information isin accordance with the facts and does not omit anything likely to affect the import of such information.

Deutsche Bank AG accepts responsibility for the information relating to it as Hedging Counterpartyincluded in this Prospectus in the section headed “The Hedging Counterparty”. To the best of its knowledgeand belief, Deutsche Bank AG (which have taken all reasonable care to ensure that such is the case), suchinformation is in accordance with the facts and does not omit anything likely to affect the import of suchinformation. The information in the section headed “The Hedging Counterparty” has been provided solelyby Deutsche Bank AG, for use in this Prospectus and Deutsche Bank AG is solely responsible for theaccuracy of the information in this section. Except for the section headed “The Hedging Counterparty”,Deutsche Bank AG in its capacity as Hedging Counterparty and its respective affiliates have not beeninvolved in the preparation of, and do not accept responsibility for, this Prospectus.

Deutsche Bank S.p.A. accepts responsibility for the information relating to it as Liquidity Provider includedin this Prospectus in the section headed “The Liquidity Provider”. To the best of its knowledge and belief,Deutsche Bank S.p.A. (which have taken all reasonable care to ensure that such is the case), suchinformation is in accordance with the facts and does not omit anything likely to affect the import of suchinformation. The information in the section headed “The Liquidity Provider” has been provided solely byDeutsche Bank S.p.A. for use in this Prospectus and Deutsche Bank S.p.A. is solely responsible for theaccuracy of the information in this section. Except for the section headed “The Liquidity Provider”,Deutsche Bank S.p.A. in its capacity as Liquidity Provider and its respective affiliates have not been involvedin the preparation of, and do not accept responsibility for, this Prospectus.

No person has been authorised to give any information or to make any representation not contained in thisProspectus and, if given or made, such information or representation must not be relied upon as having beenauthorised by or on behalf of the Issuer, the Quotaholder, the Representative of the Noteholders, the ItalianPaying Agent, the Additional Paying Agent, the Cash Manager, the Calculation Agent, the TransactionAccount Bank, the Italian Account Bank, the Originator, the Servicer, the Corporate Servicer, the HedgingCounterparty, the Lead Manager, the Arranger, the Liquidity Provider, the Class Z Notes Subscriber (ineach case, such person in any capacity in which it is acting), or any other person. Neither the delivery of thisProspectus nor any sale or allotment made in connection with the offering of any of the Notes shall, underany circumstances, constitute a representation or create any implication that there has been no change in theaffairs of the Issuer, the Hedging Counterparty or the Liquidity Provider or in any of the other informationcontained herein since the date hereof or that the information contained herein is correct as at any time

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subsequent to the date hereof. None of the Quotaholder, the Representative of the Noteholders, the ItalianPaying Agent, the Additional Paying Agent, the Cash Manager, the Calculation Agent, the TransactionAccount Bank, the Italian Account Bank, the Originator, the Servicer, the Corporate Servicer, the HedgingCounterparty, the Lead Manager, the Arranger, the Liquidity Provider, the Class Z Notes Subscriber (ineach case, such person in any capacity in which it is acting), or any other person (other than the Issuer, theHedging Counterparty, or the Liquidity Provider and in each case solely to the extent described above)makes any representation, express or implied, or accepts any responsibility, with respect to the accuracy orcompleteness of any of the information in this Prospectus. This Prospectus may only be used for the purposefor which it has been published.

Selling Restrictions

The distribution of this Prospectus and the offering of the Notes in certain jurisdictions may be restricted bylaw and by the Transaction Documents, in particular, as provided by and described in the SubscriptionAgreements. Persons into whose possession this Prospectus (or any part of it) comes are required by theIssuer and the Lead Manager to inform themselves about, and to observe, any such restrictions. Neither thisProspectus nor any part of it constitutes an offer, and may not be used for the purpose of an offer, to sell anyof the Notes, or a solicitation of an offer to buy any of the Notes, by anyone in any jurisdiction or in anycircumstances in which such offer or solicitation is not authorised or is unlawful.

The Notes may not be offered or sold directly or indirectly, and neither this Prospectus nor any otherprospectus, form of application, advertisement, other offering material or other information relating to theIssuer or the Notes may be issued, distributed or published in any country or jurisdiction (including theRepublic of Italy, the United Kingdom and the United States), except under circumstances that will result incompliance with all applicable laws, orders, rules and regulations. For a further description of certainrestrictions on offers and sales of the Notes and the distribution of this Prospectus, see the section headed“Subscription and Sale”.

The Notes have not been and will not be registered under the United States Securities Act of 1933, asamended (the “Securities Act”), and subject to certain exceptions, may not be offered, sold or deliveredwithin the United States nor to, or for the account or benefit of, U.S. persons (as defined in Regulation Sunder the Securities Act). The Notes are in bearer and dematerialised form and are subject to U.S. tax lawrequirements. The Notes are being offered for sale outside the United States in accordance with Regulation Sunder the Securities Act (see the section headed “Subscription and Sale”).

Stabilisation

In connection with the issue of the Rated Notes, Deutsche Bank AG (in such capacity, the “StabilisationManager”) (or persons acting on behalf of the Stabilisation Manager) may over-allot the Rated Notes(provided that the aggregate principal amount of the Rated Notes allotted does not exceed 105 per cent. ofthe aggregate principal amount of the relevant Class of Notes) or effect transactions with a view tosupporting the market price of the Rated Notes at a level higher than that which might otherwise prevail.However, there is no assurance that the Stabilisation Manager (or persons acting on behalf of theStabilisation Manager) will undertake stabilisation action. Any stabilisation action may begin on or after thedate on which adequate public disclosure of the final terms of the offer of the Rated Notes is made and, ifbegun, may be ended at any time, but it must end no later than the earlier of 30 days after the issue date ofthe Rated Notes and 60 days after the date of the allotment of the Rated Notes. Such stabilisation shall beconducted in accordance with the applicable laws and rules.

Definitions

Words and expressions in this Prospectus shall, except so far as the context otherwise requires, have thesame meanings as those set out in the “Glossary of Terms”. These and other terms used in this Prospectus

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are subject to, and in some cases are summaries of, the definitions of such terms set out in the TransactionDocuments as they may be amended from time to time.

All references in this Prospectus to “Euro”, “euro”, “EUR” or “€” are to the lawful currency of theMember States of the European Union that adopt the single currency in accordance with the Treatyestablishing the European Community, as amended by the Treaty on the European Union.

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TABLE OF CONTENTS

Page

TRANSACTION DIAGRAM ............................................................................................................................... 7

TRANSACTION SUMMARY INFORMATION .................................................................................................. 8

RISK FACTORS .................................................................................................................................................. 33

THE PORTFOLIO................................................................................................................................................ 55

THE ORIGINATOR ............................................................................................................................................. 68

THE LIQUIDITY PROVIDER.............................................................................................................................. 70

THE HEDGING COUNTERPARTY .................................................................................................................... 71

THE ISSUER........................................................................................................................................................ 72

USE OF PROCEEDS............................................................................................................................................ 74

PURCHASE OF THE PORTFOLIO ..................................................................................................................... 75

SERVICING OF THE PORTFOLIO..................................................................................................................... 90

SUMMARY OF THE TRANSACTION DOCUMENTS ....................................................................................... 95

CREDIT STRUCTURE ........................................................................................................................................ 103

ISSUER ACCOUNTS AND CASH FLOWS......................................................................................................... 113

TERMS AND CONDITIONS OF THE NOTES.................................................................................................... 118

EXPECTED MATURITY AND EXPECTED AVERAGE LIFE OF THE RATED NOTES................................... 171

TAXATION.......................................................................................................................................................... 173

SUBSCRIPTION AND SALE............................................................................................................................... 180

GLOSSARY OF TERMS...................................................................................................................................... 184

GENERAL INFORMATION................................................................................................................................ 212

APPENDIX 1........................................................................................................................................................ 215

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TRANSACTION DIAGRAM

The following is a diagram showing the structure of the Securitisation as at the Issue Date. It is intended toillustrate to prospective noteholders the principal parties in the transaction structure as at the Issue Date.

Class B Notes

Class C Notes

Class D Notes

Class E Notes

Funding ofCash Reserve

Purchase Price

QuotaholderStichting

Muidenburg

Representative ofNoteholders

Deutsche TrusteeCompany Limited

Cash Manager,Transaction Account

Bank, AdditionalPaying Agent,

Calculation AgentDeutsche Bank AG,

London Branch

Sale ofInitial Pool

andAdditional

Pools(if any)

IssuerEurohome (Italy)Mortgages S.r.l.

Originator, ServicerDeutsche Bank Mutui

S.p.A.

Hedging CounterpartyDeutsche Bank AG,

London Branch

Italian Account Bank,Italian Paying Agent,

Liquidity ProviderDeutsche Bank

S.p.A.

Class Z Notes

Cash Reserve

Class A Notes

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TRANSACTION SUMMARY INFORMATION

The following information is a summary of the transactions and assets underlying the Notes and is qualifiedin its entirety by reference to the detailed information presented elsewhere in this Prospectus and in theTransaction Documents.

1. THE PRINCIPAL PARTIES

Issuer Eurohome (Italy) Mortgages S.r.l., a limited liability company (societàa responsabilità limitata) incorporated on 15 November 2006 underthe laws of the Republic of Italy in accordance with Article 3 of theSecuritisation Law (the “Issuer”). The registered office of the Issuer isat via Eleonora Duse 53, Rome, Italy. The Issuer is registered (i) in thecompanies’ register of Rome, under number 09218951003; (ii) in thegeneral register held by the Ufficio Italiano dei Cambi pursuant toArticle 106 of the Italian Banking Act, under number 39050; and (iii)in the special register of financial intermediaries held by the Bank ofItaly pursuant to Article 107 of the Italian Banking Act.

Originator Deutsche Bank Mutui S.p.A., a joint stock company incorporated andorganised under the laws of Italy, with registered office at Via SantaSofia 10, 20122 Milan, Italy, enrolled with the Companies Register ofMilan, Italy with fiscal code and registration No. 08226630153,registered with the register of the banks referred to in Article 13 of theItalian Banking Act.

Servicer Deutsche Bank Mutui S.p.A. (with its registered office at Via SantaSofia 10, 20122 Milan, Italy) will act as servicer for the Issuer, interalia, to service the Portfolio.

Arranger Deutsche Bank AG, London Branch (with its principal office atWinchester House, 1 Great Winchester Street, London EC2N 2DB).

Lead Manager Deutsche Bank AG, London Branch.

Bookrunner Deutsche Bank AG, London Branch.

Hedging Counterparty andHedging Calculation Agent

Deutsche Bank AG, London Branch.

Representative of theNoteholders

Deutsche Trustee Company Limited (with its principal office atWinchester House, 1 Great Winchester Street, London EC2N 2DB).

Cash Manager,Transaction Account Bank,Calculation Agent andAdditional Paying Agent

Deutsche Bank AG, London Branch

Italian Account Bank,Italian Paying Agent andLiquidity Provider

Deutsche Bank S.p.A., (with its principal office at Piazza delCalendario 3, 20126 Milan, Italy).

Corporate Servicer KPMG Fides Servizi di Amministrazione S.p.A., a joint stockcompany incorporated in Italy with registered office at Via Vittor

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Pisani 27, 20124 Milan, acting through its office at Via EleonoraDuse, 53, 00197 Rome, enrolled with the companies’ register of Milanunder no. 103478, fiscal code and VAT number 00731410155).

Listing Agent Deutsche Bank Luxembourg Société Anonyme, 2 bd. KonradAdenauer, L-1115 Luxembourg

Quotaholder Stichting Muidenburg, a Dutch foundation having its registered officeat Amsteldijk 166, 1079 LH, Amsterdam, The Netherlands.

2. THE NOTES

The Issue On the Issue Date, the Issuer will issue the Euro 211,950,000 Class AMortgage Backed Floating Rate Notes due November 2054 (the“Class A Notes”), the Euro 15,900,000 Class B Mortgage BackedFloating Rate Notes due November 2054 (the “Class B Notes”), theEuro 11,550,000 Class C Mortgage Backed Floating Rate Notes dueNovember 2054 (the “Class C Notes”); the Euro 7,200,000 Class DMortgage Backed Floating Rate Notes due November 2054 (the“Class D Notes”) the Euro 10,300,000 Class E Mortgage BackedFloating Rate Notes due November 2054 (the “Class E Notes”, and,together with the Class A Notes, the Class B Notes, the Class C Notesand the Class D Notes, the “Rated Notes”). The Issuer will also issuethe Euro 3,950,000 Class Z Mortgage Backed Fixed Rate and VariableReturn Notes due November 2054 (the “Class Z Notes” and, togetherwith the Rated Notes, the “Notes”).

Status The Notes will constitute direct and limited recourse obligations solelyof the Issuer secured over certain assets of the Issuer as described inthe section headed “Summary of the Transaction Documents”. Inparticular, the Notes will not be obligations or responsibilities of, orguaranteed by, any person except the Issuer and no person other thanthe Issuer shall be liable in respect of any failure by the Issuer to makepayment of any amount due on the Notes.

Issue Price On the Issue Date the Rated Notes will be issued at an issue price of100 per cent. of their Principal Amount Outstanding. The Class ZNotes will be issued at an issue price of 100 per cent. of their PrincipalAmount Outstanding.

Credit Rating The Class A Notes are expected, on issue, to be rated “Aaa” byMoody’s and “AAA” by S&P.

The Class B Notes are expected, on issue, to be rated “Aa2” byMoody’s and “AA” by S&P.

The Class C Notes are expected, on issue, to be rated “A1” byMoody’s and “A” by S&P.

The Class D Notes are expected, on issue, to be rated “Baa2” byMoody’s and “BBB-” by S&P.

The Class E Notes are expected, on issue, to be rated “B3” by

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Moody’s.

The Class Z Notes will not be assigned a credit rating.

A credit rating is not a recommendation to buy, sell or hold securitiesand may be subject to revision or withdrawal at any time by theassigning rating organisation.

Form and denomination The denomination of the Notes will be Euro 50,000. The Notes will beissued in bearer and dematerialised form on behalf of the ultimateowners, until redemption or cancellation thereof, through Monte Titolifor the account of the relevant Monte Titoli Account Holders. MonteTitoli shall act as depository for Clearstream and Euroclear. Title to theNotes will at all times be evidenced by book-entries in accordancewith the provisions of Article 28 of Italian Legislative Decree No. 213of 24 June 1998 and CONSOB Resolution No. 11768 of 23 December1998 as amended from time to time. No physical document of title willbe issued in respect of the Notes.

Interest Each Note will bear interest on its Principal Amount Outstanding fromand including the Issue Date until final redemption as provided inCondition 7 (Redemption, Purchase and Cancellation). Interest on theNotes will be payable in Euro quarterly in arrear by reference tosuccessive interest periods on each Payment Date falling in February,May, August and November in each year, net of withholding ordeduction required by law (if any) and subject to and in accordancewith the Conditions, including the interest deferral and limitedrecourse provisions thereof. The first Payment Date shall be thePayment Date falling in May 2008.

Payments of interest on the Class or Classes of Notes other than theMost Senior Class of Notes then outstanding will be subject to deferral(i) to the extent that there are insufficient Available Funds on anyPayment Date in accordance with the relevant Priority of Payments topay in full the amount of interest which would otherwise be payable onthe Class or Classes of Notes other than the Most Senior Class ofNotes then outstanding or (ii) following a Credit Trigger Event. Theamount by which the aggregate amount of interest paid on each Classof Notes on any Payment Date in accordance with Condition 6 (Rightto Interests) falls short of the aggregate amount of interest whichotherwise would be payable on the relevant Notes on that date shall beaggregated (with no interest accruing on such shortfall) with theamount of, and treated for the purposes of, Condition 6 (Right toInterests) as if it were interest due on each such Class of Notes and,subject as provided below and the limited recourse provisions set outin the Conditions, payable on the next succeeding Payment Date.

If, on the Maturity Date (or on any earlier redemption of the relevantClass of Notes in full), there remains any such shortfall, the amount ofsuch shortfall will become due and payable on the Maturity Date (or,in the case of any earlier redemption of the relevant Class of Notes infull, on the date of such earlier redemption) subject in each case to theamounts of Available Funds.

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Maturity Date Save as described below, unless previously redeemed in full, the Issuerwill redeem the Class A Notes, the Class B Notes, the Class C Notes,the Class D Notes, the Class E Notes and the Class Z Notes at theirPrincipal Amount Outstanding on the Maturity Date.

Immediately following the Maturity Date, all Notes will be deemed tobe discharged in full, and any amount in respect of principal, interestor other amounts outstanding in respect of the Notes will (unlesspayment of any such amounts is improperly withheld or refused) befinally and definitively cancelled.

Tax All payments in respect of the Notes will be made net of anywithholding or deduction for or on account of tax required by law(including, without limitation, any Law 239 Withholding) and neitherthe Issuer nor other person shall be obliged to pay any additional, orgross-up, amounts to any Noteholder on account of such withholdingor deduction.

According to the provisions of Article 6 of Law 239, as amended fromtime to time, a holder of a Note who (a) is not a person resident for taxpurposes (or an institutional investor incorporated) in a country whichallows an adequate exchange of information with the Republic of Italy,or (b) is resident/incorporated in such a country but has not fulfilled allthe requisite documentary requirements under Law 239, will receiveamounts of interest payable on the Notes net of Italian withholding tax.

(See section headed “Taxation”).

Mandatory pro rata redemptionin whole or in part

The Notes will be subject to mandatory pro rata redemption (withineach Class) in whole or in part on the First Amortisation Payment Dateand on each following Payment Date to the extent that the Issuer hassufficient Available Capital Funds for such purpose, in accordancewith the provisions of Condition 7(b) (Redemption, Purchase andCancellation – Mandatory pro rata redemption in whole or in part).Except following the service of an Issuer Enforcement Notice or theoccurrence of an Issuer Insolvency Event, no mandatory redemption ofthe Principal Amount Outstanding under the Notes by the Issuer mayoccur during the Initial Period.

Early redemption by the Issuer As provided in Condition 7(d) (Redemption, Purchase andCancellation – Early redemption by the Issuer), prior to the delivery ofan Issuer Enforcement Notice or the occurrence of an IssuerInsolvency Event, at any time after the later of the expiry of the InitialPeriod and the Payment Date on which the aggregate principal amountoutstanding of the Portfolio is equal to or less than 10% of the InitialPrincipal Amount of the Portfolio the Issuer may redeem all, but notsome only of, the Notes (or the Rated Notes, as applicable) at theirPrincipal Amount Outstanding (plus any accrued but unpaid interest)in accordance with the Enforcement Priority of Payments and subjectto the Issuer having sufficient funds to redeem (i) all the Notes and tomake all payments ranking in priority thereto, or pari passu therewith,or (ii) the Rated Notes and to make all payments ranking in prioritythereto, or pari passu therewith, but not the Class Z Notes, and the

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Class Z Noteholders have consented to such redemption.

In accordance with Condition 7(d) (Redemption, Purchase andCancellation – Early redemption by the Issuer), should the Issuerredeem the Notes, it will have to obtain an independent third party’sappraisal certifying that the sale price of the portfolio corresponds tothe then market value of thereof. The Issuer shall apply the proceeds ofsuch sale of the Portfolio in or towards redemption of all the Notes (orthe Rated Notes, as applicable) and give not more than 60 nor less than30 days’ prior notice in writing to the Representative of theNoteholders and to the Noteholders in accordance with Condition 16(Notice to Noteholders) of the redemption of the Notes of eachrelevant Class subject to and in accordance with Condition 5.2 (Orderof Priority – Enforcement Priority of Payments).

Redemption of the Notes at theoption of the Put OptionNoteholders

As provided in Condition 7(e) (Redemption, Purchase andCancellation – Redemption of the Notes at the option of the Put OptionNoteholders), prior to the service of an Issuer Enforcement Notice orthe occurrence of an Issuer Insolvency Event, and provided that theClass A Sub-Ledger Condition was satisfied as at the Calculation Dateimmediately preceding the most recent Payment Date, each Put OptionNoteholder shall have the option (a “Put Option”) to offer all (but notonly part of) the Put Option Notes held by it to the Issuer forredemption at their Redemption Value on the Payment Date falling inFebruary 2015 (the “First Put Date”) and each Payment Datethereafter (such Payment Date and the First Put Date, each being a“Put Date”) in accordance with the following provisions. The Class ENoteholders and the Class Z Noteholders will not have the right toexercise the Put Option.

(i) If the Class A Sub-Ledger Condition was satisfied as at theCalculation Date immediately preceding the most recentPayment Date and the Put Option has been validly exercised inaccordance with paragraph (iii) below, then the Issuer will beobliged, subject to the availability of sufficient RedemptionFunds, to redeem the Notes at their Redemption Value on thenext following Put Date (as applicable) (subject to theconditions being set out in paragraph (vii) below beingsatisfied).

(ii) On or before the seventy-fifth (75th) day prior to each Put Date(as applicable), the Issuer shall notify the Put OptionNoteholders and the Representative of the Noteholders inaccordance with Condition 16 (Notice to Noteholders), bysending a notice containing the following information (the“Put Option Information Notice”):

(A) whether the Class A Sub-Ledger Condition wassatisfied as at the Calculation Date immediatelypreceding the most recent Payment Date;

(B) the assumed remaining average life of each Class ofPut Option Notes if the Put Option is not exercised, re-

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calculated as at such date;

(C) provided that the Class A Sub-Ledger Condition wasmet as at the Calculation Date immediately precedingthe most recent Payment Date, the right of each PutOption Noteholder to exercise the Put Option underthe terms set out in the Conditions;

(D) the requirement to give a Put Option Exercise Notice(as defined below) no later than by close of businesson the sixtieth (60th) day prior to such Put Date (unlesssuch day is not a Business Day, in which case theimmediately preceding Business Day) if the PutOption Noteholder wishes to exercise the Put Option;and

(E) the circumstance that, if a Put Option Quorum has sentone or more Put Option Exercise Notices inaccordance with paragraph (D) above, the Issuer,subject to the availability of sufficient RedemptionFunds, will redeem the Notes at their RedemptionValue on such Put Date (as the case may be).

(iii) The Put Option shall be deemed to have been exercised byeach Put Option Noteholder on a Put Date if (A) the Class ASub-Ledger Condition was met as at the Calculation Dateimmediately preceding the most recent Payment Date, and (B)a Put Option Quorum has delivered to the Issuer, with copy tothe Representative of the Noteholders and the CalculationAgent, at any time during normal business hours of the Issuerwithin a period of not less than sixty (60) days (unless suchsixtieth (60th)) day is not a Business Day, in which case theimmediately preceding day) and not more than seventy-five(75) days prior to such Put Date (the “Put Notice Period”), aduly signed notice (bearing attached a certificate of thecustodian of such Put Option Note(s) evidencing the title ofsuch Put Option Noteholder to the relevant Put OptionNote(s)) stating that it wishes to exercise the Put Option (the“Put Option Exercise Notice”).

(iv) Any Put Option Exercise Notice given by any Put OptionNoteholder shall be irrevocable. If prior to a Put Date an Eventof Default or an Issuer Insolvency Event shall have occurredand be continuing, all Put Option Noteholders shall be deemednot to have delivered a Put Option Exercise Notice pursuant toparagraph (iii) and the Notes shall forthwith become due andpayable pursuant to Condition 5.5 (Order of Priority –Enforcement Priority of Payments).

(v) Within 5 (five) Business Days from the expiry of the PutNotice Period, the Issuer, or the Calculation Agent on itsbehalf, will notify the Noteholders, the Representative of theNoteholders and the Paying Agents in accordance withCondition 16 (Notice to the Noteholders) whether it has

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received one or more Put Option Exercise Notices from a PutOption Quorum and consequently whether the Put Option hasbeen or is deemed to have been validly exercised by the PutOption Noteholders (the “Put Option Outcome Notice”).

(vi) If (A) the Class A Sub-Ledger Condition was not met as at theCalculation Date immediately preceding the most recentPayment Date or (B) the Put Option Quorum has not sent oneor more Put Option Exercise Notices in accordance withparagraph (iii) above, no Put Option Sale Procedure (asdefined below) will take place, the Notes will not be redeemedat their Redemption Value on a Put Date and payments on theNotes will continue to be made in accordance with the Priorityof Payments.

(vii) If, in respect of a Put Date (A) the Class A Sub-LedgerCondition was met as at the Calculation Date immediatelypreceding the most recent Payment Date, and (B) the PutOption Quorum has sent one or more Put Option ExerciseNotices in accordance with paragraph (iii) above, then the PutOption will be deemed to have been validly exercised by allPut Option Noteholders in accordance with paragraph (iii)above, the Issuer shall use its best endeavours to sell thePortfolio pursuant to a Put Option Sale Procedure under theterms set out in paragraph (viii) below, and, subject to thefollowing conditions being met:

(A) the Redemption Funds being at least sufficient toredeem the Notes at their Redemption Value and tomake all payments ranking in priority thereto, or paripassu therewith, on such Put Date in accordance withCondition 5.5 (Order of Priority – EnforcementPriority of Payments);

(B) the Issuer having certified and produced evidenceacceptable to the Representative of the Noteholders asto the sufficiency of the Redemption Funds for thepurposes of paragraph (A) above; and

(C) the Issuer having obtained from the purchaser(s) of thePortfolio (or any portion thereof) a certificate of goodstanding from the competent companies’ register, asolvency certificate and a certificate confirming theabsence of insolvency proceedings from thebankruptcy court or equivalent jurisdictional body inthe country of incorporation of the purchaser,

the Notes will be redeemed at their respective RedemptionValue on such Put Date, and the Issuer shall apply theRedemption Funds in or towards redeeming the Notes togetherwith all interest accrued thereon subject to and in accordancewith Condition 5.5 (Order of Priority – Enforcement Priorityof Payments).

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(viii) In the period commencing on the date of delivery of a PutOption Outcome Notice confirming the valid exercise of thePut Option and ending on the Calculation Date immediatelypreceding the relevant Put Date, both excluded (the “PutOption Sale Period”), the Issuer shall use its best endeavoursto dispose (in the manner and pursuant to the procedure itdeems fit) of the Portfolio to one or more third parties (otherthan the Originator and companies belonging to the DeutscheBank S.p.A. banking group (collectively, the “DB S.p.A.Group Entities”) in accordance with paragraph (ix) below(the “Put Option Sale Procedure”), in order to finance theredemption of the Notes at the Redemption Value on therelevant Put Date pursuant to the terms set out in thisCondition 7(e) (Redemption of the Notes at the option of PutOption Noteholders). The Issuer will only transfer title to thePortfolio or any part thereof against both receipt from therelevant purchaser of the purchase price therefor and followingsatisfaction of the conditions referred to in paragraph (vii)above.

(ix) The Issuer shall be entitled to sell (i) the Loan Receivablescomprised in the Portfolio which are not Defaulted LoanReceivables at a price not lower than the aggregate of theirthen principal amount outstanding and the interest accruedthereon at the rate set out in the relevant Loan Agreements,and (ii) the Defaulted Loan Receivables then comprised in thePortfolio (if any) at a price not lower than the market valuethereof, as determined and certified in writing to the Issuer andthe Representative of the Noteholders by a financial institutionor auditing firm with considerable experience in the Italiannon-performing loans market – being independent from theOriginator, the Originator’s group, each Other Issuer SecuredCreditor and the Deutsche Bank AG group – selected by theIssuer subject to the consent of the Representative of theNoteholders. Deutsche Bank A.G., either directly or through adifferent entity appointed by it (other than the DB S.p.A.Group Entities), shall in each case have a pre-emption right inconnection with each sale of the Portfolio or any portionthereof. Deutsche Bank A.G. will be entitled to exercise suchpre-emption right within fifteen (15) Business Days from thecommencement of the Put Option Sale Period.

(x) In the event that, as a result of the failure to dispose of thePortfolio during the Put Option Sale Period or because any ofthe conditions set out in paragraph (vii) above would not besatisfied, the Issuer does not have sufficient RedemptionFunds to redeem the Notes at their Redemption Value on a PutDate, this will not constitute an Event of Default. In such case,payments on the Notes will continue to be made in accordancewith the Priority of Payments as if no Put Option had beenexercised. The Issuer shall be entitled to carry out one or morefurther Put Option Sale Procedures before any subsequent PutDate until the Issuer receives net proceeds of such Put Option

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Sale Procedure such to enable it to redeem the Notes at theirRedemption Value on the subsequent Put Option Date inaccordance with this Condition 5.5 (Order of Priority –Enforcement Priority of Payments).

(xi) By purchasing the relevant Notes, each Noteholder expresslyacknowledges and agrees that, notwithstanding any otherprovision of these Conditions, the principal amount payable onredemption of each Note on a Put Date following the exerciseof the Put Option shall be limited to the relevant RedemptionValue as at such date. If the Redemption Value of a Note ofany Class on a Put Date is less than the then Principal AmountOutstanding of such Note, the balance of the Principal AmountOutstanding in respect of the Note shall cease to be due andpayable and shall be definitively cancelled and the holder ofthat Note shall have no further claim against the Issuer for theexcess.

Redemption for Tax orRegulatory Event

As provided in Condition 7(c) (Redemption, Purchase andCancellation – Redemption for Tax or Regulatory Event), prior to theservice of an Issuer Enforcement Notice or the occurrence of an IssuerInsolvency Event, the Issuer shall redeem at its option all, but not someonly of, the Notes (or the Rated Notes, but not the Class Z Notes,where the Class Z Noteholders have consented to such redemption) attheir Principal Amount Outstanding (plus any accrued but unpaidinterest) in accordance with the Enforcement Priority of Payments andsubject to the Issuer having sufficient funds to redeem (i) all the Notesand to make all payments ranking in priority thereto, or pari passutherewith, or (ii) the Rated Notes and to make all payments ranking inpriority thereto, or pari passu therewith, but not the Class Z Notes, andthe Class Z Noteholders have consented to such redemption, if, byreason of a change in the laws of the Republic of Italy or theinterpretation or administrative practice in respect thereof since theIssue Date:

(i) the patrimonio separato of the Issuer in respect of theSecuritisation becomes subject to taxes, duties, assessments orgovernmental charges of whatever nature imposed, levied,collected, withheld or assessed by the Republic of Italy or anypolitical sub-division thereof or any authority thereof ortherein or any applicable taxing authority having jurisdiction;or

(ii) either the Issuer or any paying agent appointed in respect ofthe Notes or any custodian of the Notes is required to deductor withhold any amount (other than in respect of a Law 239Withholding) in respect of any Class of Notes, from anypayment of principal or interest on such Payment Date for oron account of any present or future taxes, duties, assessmentsor governmental charges of whatever nature imposed, levied,collected, withheld or assessed by the Republic of Italy or anypolitical sub-division thereof or any authority thereof ortherein or any other applicable taxing authority having

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jurisdiction and provided that such deduction or withholdingmay not be avoided by appointing a replacement paying agentor custodian in respect of the Notes before the Payment Datefollowing the change in law or the interpretation oradministration thereof; or

(iii) any amounts of interest payable on the Loans to the Issuer arerequired to be deducted or withheld from the Issuer for or onaccount of any present or future taxes, duties assessments orgovernmental charges of whatever nature imposed, levied,collected, withheld or assessed by the Republic of Italy or anypolitical sub-division thereof or any authority thereof ortherein or any other applicable taxing authority havingjurisdiction; or

(iv) it is or will become unlawful for the Issuer to perform any ofits material obligations under or in respect of the Notes or anyof the Transaction Documents to which it is a party,

each such event, a “Tax or Regulatory Event”.

Subordination between theClasses of Notes

The Notes of each Class shall rank pari passu without preference orpriority amongst themselves.

The rights of the Noteholders in respect of priority of payment ofinterest and principal are set out in Condition 5 (Order of Priority) andare subject to the provisions of the Intercreditor Agreement. Paymentsin respect of the Notes are subordinated to certain prior rankingamounts due from the Issuer as set out in Condition 5 (Order ofPriority) and are subject to the provisions of the IntercreditorAgreement.

If prior to the service of an Issuer Enforcement Notice or theoccurrence of an Issuer Insolvency Event the Pro rata AmortisationConditions are not met, in respect of repayment of principal: (i) theClass A Notes will rank pari passu and pro rata without anypreference or priority among themselves and in priority to the Class BNotes, the Class C Notes, the Class D Notes, the Class E Notes and theClass Z Notes for all purposes; (ii) the Class B Notes will rank paripassu and pro rata without any preference or priority amongthemselves and in priority to the Class C Notes, the Class D Notes, theClass E Notes and the Class Z Notes, but subordinated to the Class ANotes; (iii) the Class C Notes will rank pari passu and pro ratawithout any preference or priority among themselves and in priority tothe Class D Notes, the Class E Notes and the Class Z Notes, butsubordinated to the Class A Notes and the Class B Notes; (iv) theClass D Notes will rank pari passu and pro rata without anypreference or priority among themselves and in priority to the Class ENote and the Class Z Notes, but subordinated to the Class A Notes, theClass B Notes, the Class C Notes; (v) the Class E Notes will rank paripassu and pro rata without any preference or priority amongthemselves and in priority to the Class Z Notes, but subordinated to theClass A Notes, the Class B Notes, the Class C Notes and the Class DNotes; (vi) the Class Z Notes will rank pari passu and pro rata without

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any preference or priority among themselves and subordinated to theClass A Notes, the Class B Notes, the Class C Notes, the Class DNotes and the Class E Notes.

If prior to the service of an Issuer Enforcement Notice or theoccurrence of an Issuer Insolvency Event the Pro rata AmortisationConditions are met on any Calculation Date, then on the immediatelyfollowing Payment Date, the Class A Notes, the Class B Notes, theClass C Notes, the Class D Notes and the Class E Notes will rank paripassu and pro rata without any preference or priority amongthemselves in respect of repayment of principal under the terms set outin Condition 5.2, whilst the Class Z Notes will rank pari passu and prorata without preference of priority among themselves and subordinatedin respect of repayment of principal to the Rated Notes of all Classes(Order of Priority – Pre-Enforcement Principal Priority of Payments).

In respect of the obligation of the Issuer to pay interest on the Notes,prior to the service of an Issuer Enforcement Notice or the occurrenceof an Issuer Insolvency Event, (i) the Class A Notes will rank paripassu and pro rata among themselves and priority to the Class BNotes, Class C Notes, Class D Notes, the Class E Notes and the ClassZ Notes; (ii) the Class B Notes will rank pari passu and pro rataamong themselves and in priority to the Class C Notes, Class D Notes,the Class E Notes and Class Z Notes, but subordinated to the Class ANotes; (iii) the Class C Notes will rank pari passu and pro rata amongthemselves and in priority to the Class D Notes, the Class E Notes andClass Z Notes, but subordinated to the Class A Notes and the Class BNotes; (iv) the Class D Notes will rank pari passu and pro rata amongthemselves and in priority to the Class E Notes and the Class Z Notes,but subordinated to the Class A Notes, the Class B Notes and the ClassC Notes; (v) the Class E Notes will rank pari passu and pro rataamong themselves and in priority to the Class Z Notes, butsubordinated to the Class A Notes, the Class B Notes, the Class CNotes and the Class D Notes; (vi) the Class Z Notes will rank paripassu and pro rata among themselves but subordinated to the Class ANotes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes under the terms set out in Condition 5.1 (Order ofPriority – Pre-Enforcement Interest Priority of Payments).

Following the service of an Issuer Enforcement Notice or theoccurrence of an Issuer Insolvency Event, (i) the Class A Notes willrank pari passu and pro rata without any preference or priority amongthemselves and in respect of payments of interest and of repayment ofprincipal in priority to the Class B Notes, the Class C Notes, the ClassD Notes, the Class E Notes and the Class Z Notes for all purposes; (ii)the Class B Notes will rank pari passu and pro rata without anypreference or priority among themselves and in respect of payments ofinterest and of repayment of principal in priority to the Class C Notes,the Class D Notes, the Class E Notes and the Class Z Notes for allpurposes, but subordinated to the Class A Notes; (iii) the Class CNotes will rank pari passu and pro rata without any preference orpriority among themselves and in respect of payments of interest andof repayment of principal in priority to the Class D Notes, the Class E

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Notes and the Class Z Notes for all purposes, but subordinated to theClass A Notes and the Class B Notes; (iv) the Class D Notes will rankpari passu and pro rata without any preference or priority amongthemselves and in respect of payments of interest and of repayment ofprincipal in priority to the Class E Notes and the Class Z Notes for allpurposes, but subordinated to the Class A Notes, the Class B Notes,the Class C Notes; (v) the Class E Notes will rank pari passu and prorata without any preference or priority among themselves and inrespect of payments of interest and of repayment of principal inpriority to the Class Z Notes for all purposes, but subordinated to theClass A Notes, the Class B Notes, the Class C Notes and the Class DNotes; (vi) the Class Z Notes will rank pari passu and pro rata withoutany preference or priority among themselves for all purposes andsubordinated in respect of payments of interest and of repayment ofprincipal to the Class A Notes, the Class B Notes, the Class C Notes,the Class D Notes and the Class E Notes, under the terms set out inCondition 5.5 (Order of Priority –Enforcement Priority of Payments).

Pro rata Amortisation Conditions “Pro rata Amortisation Conditions” means the conditions followingthe occurrence of which repayment of principal on the Rated Noteswill be made pari passu and pro rata according to the PrincipalAmount Outstanding of each Class of the Rated Notes. The Pro rataAmortisation Conditions are satisfied on any Calculation Date if all ofthe following events occur:

(i) the result produced by the fraction(B+C+D+E)/(A+B+C+D+E) is greater than or equal to twicethe result produced by that fraction as at the Issue Date;

(ii) all balances on each of the Principal Deficiency Sub-Ledgersare zero;

(iii) the Cash Reserve Balance is at least equal to the Cash ReserveRequired Amount;

(iv) no amount has been drawn down and is outstanding under theLiquidity Facility Agreement;

(v) the Arrears Ratio does not exceed 5%;

(vi) the total balance of all Loan Receivables comprised in thePortfolio which are 90 days or more in arrears does not exceed5 per cent. of the total balance of all the Loan Receivablescomprised in the Portfolio;

(vi) the Unpaid Principal Deficiency is lower than 6%; and

(vii) no Event of Default has occurred or is outstanding.

For the purposes of this paragraph, as at any date:

A = the aggregate Principal Amount Outstanding of the Class ANotes on such date;

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B = the aggregate Principal Amount Outstanding of the Class BNotes on such date;

C = the aggregate Principal Amount Outstanding of the Class CNotes on such date;

D = the aggregate Principal Amount Outstanding of the Class DNotes on such date; and

E = the aggregate Principal Amount Outstanding of the Class ENotes on such date.

Security for the Notes By operation of Italian law, the Issuer’s rights, title and interests in andto the Portfolio will be segregated from all other assets of the Issuerand the Portfolio and any relevant Collections, once received by theIssuer, will only be available, both prior to and following a winding upof the Issuer, to satisfy the obligations of the Issuer to the holders ofthe Notes, each of the Other Issuer Secured Creditors and anyConnected Third Party Creditor. Further security is provided by thePledge Agreement and the Deed of Charge.

(See section headed “Summary of the Transaction Documents”).

Events of Default The occurrence of any of the following events shall constitute an“Event of Default”:

(i) default is made in respect of any repayment of principal on itsdue date or any payment of Interest Payment Amount on theMost Senior Class of Notes on the relevant Payment Datewhich default or non-payment shall have continuedunremedied for a period of three days, in the case of anypayment of interest, or five days, in the case of repayment ofprincipal (except if such default or non-payment occurs on theMaturity Date); or

(ii) default is made by the Issuer in the performance or observanceof any obligation binding upon it under the Notes or any ofthem or any other Transaction Document to which it is a party(other than in respect of the obligation to pay principal andinterest on the Most Senior Class of Notes pursuant to (i)above) and (except where the Representative of theNoteholders certifies that, in its opinion, such default isincapable of remedy, when no notice will be required) suchdefault shall have continued unremedied for a period of 30days following the service by the Representative of theNoteholders on the Issuer of notice requiring the same to beremedied; or

(iii) the Issuer breaches in any material respect any representationor warranty made by it pursuant to the Notes or any otherTransaction Document to which it is a party or which iscontained in any certificate, document or financial or otherstatement furnished at any time under or in connection with aTransaction Document to which it is a party and, in any case,

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the circumstances giving rise to such breach shall havecontinued unremedied for a period of 30 days following theservice by the Representative of the Noteholders on the Issuerof notice requiring the same to be remedied; or

(iv) an order is made or an effective resolution is passed for thewinding up of the Issuer or any of the events under Article2484 of the Italian Civil Code occurs; or

(v) the Issuer institutes or has instituted against it InsolvencyProceedings under applicable laws and such proceedings arenot, in the opinion of the Representative of the Noteholders,being disputed in good faith with a reasonable prospect ofsuccess; or

(vi) the Issuer takes any action for a readjustment or deferment ofany of its obligations or makes a general assignment or anarrangement or composition with, or for the benefit of, itscreditors (other than the Issuer Secured Creditors and anysecured creditor of the Issuer in respect of any FurtherSecuritisation) or is granted by a competent court amoratorium in respect of, any of its indebtedness or anyguarantee of any indebtedness given by it, or applies for orconsents to suspension of payments or an administrator,administrative receiver or liquidator or other similar official ofthe Issuer being appointed over or in respect of the whole orany part of the undertaking, assets and/or revenues of theIssuer or an encumbrancer taking possession of the whole or,in the opinion of the Representative of the Noteholders, anysubstantial part of the undertakings or assets of the Issuer; or

(vii) it is or will become unlawful in any respect deemed by theRepresentative of the Noteholders to be material for the Issuerto perform or comply with any of its obligations under or inrespect of the Notes or any Transaction Document to which itis a party, any obligation of the Issuer under any of theTransaction Documents deemed by the Representative of theNoteholders to be material ceases to be legal, valid, bindingand enforceable or any Transaction Document or anyobligation deemed by the Representative of the Noteholders tobe material purported to be contained therein is not effective oris alleged by the Issuer to be ineffective for any reason; or

(viii) any Security Interest purported to be created under the IssuerSecurity pursuant to the Security Documents becomes invalid,ineffective or unenforceable,

provided that (a) in the case of the event described in paragraph (vii)above, no Event of Default shall occur unless the Representative of theNoteholders shall have certified to the Issuer that such event is, in itsopinion, materially prejudicial to the interests of the holders of theMost Senior Class of Notes; and (b) in the case of each of the eventsdescribed in paragraphs (ii), (iii) and (vi) above, no Event of Defaultshall occur unless sanctioned by an Extraordinary Resolution of the

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Most Senior Class of Noteholders.

Representative of theNoteholders

The Representative of the Noteholders will represent the interests ofthe Noteholders of each Class in accordance with the Conditions of theNotes, and the interests of the Other Issuer Secured Creditors inaccordance with the Intercreditor Agreement.

The Representative of the Noteholders shall exercise as it sees fit allrights and discretions of the Noteholders under the TransactionDocuments in accordance with the Conditions and, under theIntercreditor Agreement, shall be entitled to exercise certain otherrights and discretions as agent (mandatario con rappresentanza) of allthe Issuer Secured Creditors (other than the Noteholders) with respectto the Issuer Security.

The actions of the Representative of the Noteholders will be bindingon each of the Issuer Secured Creditors. Each of the Issuer SecuredCreditors (other than the Noteholders) will agree in the IntercreditorAgreement and each of the Noteholders will agree or will be deemedto agree by virtue of the transfer to it of the Note(s), that in the exerciseof its powers, authorities, duties and discretions, the Representative ofthe Noteholders shall have regard to the interests of the Noteholdersand those of the Other Issuer Secured Creditors. However, if there is aconflict between the interests of the Noteholders of each Class, orbetween the interests of the Noteholders and those of the Other IssuerSecured Creditors, it shall have regard only to the interests of theholders of the Most Senior Class of Notes, and if there is a conflictbetween the interests of any of the Other Issuer Secured Creditors, itshall have regard only to the interests of the Other Issuer SecuredCreditor the amounts owed to which rank highest in the EnforcementPriority of Payments.

Each Noteholder, by purchasing the relevant Note, shall be deemed toagree, and each of the Issuer Secured Creditors (other than theNoteholders) will acknowledge pursuant to the IntercreditorAgreement, that the Representative of the Noteholders shall not bebound to take any steps or institute any proceedings after an IssuerEnforcement Notice has been served upon the Issuer or an IssuerInsolvency Event has occurred or to exercise any rights granted underthe mandate conferred on it by the Issuer under the IntercreditorAgreement unless it has been indemnified and/or secured to itssatisfaction against all actions, proceedings, claims and demands towhich it may thereby render itself liable and all costs, charges,damages and expenses which it may incur by so doing.

The Representative of the Noteholders shall not be liable in respect ofany Liability suffered or incurred by any Issuer Secured Creditor as aresult of the performance of its duties save where such loss, liability,claim, expense or damage is suffered or incurred as a result of anygross negligence (colpa grave), wilful default or fraud (dolo) of theRepresentative of the Noteholders.

Limitation to individual rights Under the terms of the Intercreditor Agreement and the Conditions,each of the Issuer Secured Creditors will agree that only the

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and non-petition Representative of the Noteholders is entitled to enforce the IssuerSecurity and institute any proceedings against the Issuer, take anysteps for the purposes of obtaining payment of any amount expressedto be payable to the Issuer Secured Creditors or enforce any otherobligation of the Issuer under the Conditions of each Class and/or theTransaction Documents, except in the limited circumstances permittedunder the Conditions and the Intercreditor Agreement.

No Issuer Secured Creditor may exercise any right of set-off(compensazione) against the Issuer under the Notes and/or theTransaction Documents or otherwise, other than as may be expresslyprovided therein.

Subject to and in accordance with the Intercreditor Agreement and theConditions, no Issuer Secured Creditor may take any steps for thepurpose of commencing any Insolvency Proceedings against theIssuer.

Limited Recourse andExtinguishment of Claims

None of the Noteholders or any Other Issuer Secured Creditor willhave any right or entitlement to the Issuer’s assets other than such ofthe proceeds of the Issuer Security and the Portfolio and the otherSecuritisation Assets as are available to the Issuer for this purpose inaccordance with the Conditions and the Transaction Documents. EachNoteholder and each Other Issuer Secured Creditor will acknowledgethat the limited recourse nature of the Notes produces the effect underItalian law of a “contratto aleatorio” and will accept the consequencesthereof, including the consequences of Article 1469 of the Italian CivilCode.

If, following the service of an Issuer Enforcement Notice or theoccurrence of an Issuer Insolvency Event and following theenforcement of the Issuer Security and the exercise by theRepresentative of the Noteholders of its rights in respect of thePortfolio and any asset or amount derived therefrom or, if no IssuerEnforcement Notice has been served or Issuer Insolvency Eventoccurred, on the relevant Maturity Date, the aggregate funds availableto the Issuer to repay any interest and/or outstanding principal and anyother amounts accrued and unpaid under the relevant Notes inaccordance with the relevant Priority of Payments are not sufficient topay in full such amounts, then upon distribution of the available fundson the relevant Maturity Date, only a pro rata share of the funds whichare available to the Issuer shall be applied in respect of such paymentobligations in accordance with the relevant Priority of Payments andthe unpaid balance of each such amount shall cease to be due andpayable and shall be cancelled in respect of the Notes of the relevantClass or Classes.

3. THE PORTFOLIO AND CASH MANAGEMENT ARRANGEMENTS

Acquisition of the Initial Pool Pursuant to the master transfer agreement entered into between theOriginator, the Issuer and the Representative of the Noteholders on 12December 2007, as amended on 20 December 2007 (the “MasterTransfer Agreement”), the Issuer purchased, without recourse (prosoluto) and in accordance with Articles 1 and 4 of the Securitisation

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Law, a pool of monetary receivables arising out of performing Italianlaw governed mortgage loans (mutui fondiari e ipotecari) secured oncertain residential and, to a very limited extent commercial, propertiesin Italy, classified as at the Initial Cut-Off Date as performing by theOriginator and selected on the basis of the objective criteria set forth inthe relevant Master Transfer Agreement (the “Initial Criteria”).

The transfer of the Initial Pool from the Originator to the Issuer takeseconomic effect from (and including) the Initial Cut-Off Date and theIssuer is entitled to all right, title and interest in and to the Initial Poolaccruing from (and excluding) the Initial Cut-Off Date.

On the Issue Date, the Issuer shall pay to the OriginatorEuro 256,931,734.94 as the purchase price for the Initial Pool.

(See section headed “Purchase of the Portfolio”)

Acquisition of Additional Pools During the period commencing on (and including) the date ofexecution of the Master Transfer Agreement and ending on (butexcluding) the earlier of (i) the date on which a Termination Event (asdefined below) occurs, or (ii) the date falling 18 (eighteen) calendarmonths after the Issue Date (hereinafter, the Revolving Period), theOriginator may propose to the Issuer to purchase without recoursefrom the Originator, on a quarterly basis, and, subject to the conditionsspecified below, the Issuer shall purchase from the Originator,additional pools of monetary receivables arising out of performingItalian law governed mortgage loans (mutui fondiari e ipotecari),secured on certain residential and, to a very limited extent commercial,properties in Italy, pursuant to the Italian Securitisation Law(hereinafter, the “Additional Pools”, and together with the Initial Pool,the Portfolio), selected on the basis of additional objective criteriaequal to the Initial Criteria and, where necessary, supplemented by theSpecific Criteria (the “Additional Criteria”, and together with theInitial Criteria, the “Criteria”) so that the economic and legalhomogeneity of the Loan Receivables comprised in the Portfolio ismaintained.

The purchase price payable by the Issuer in respect of the LoanReceivables comprised in any Additional Pool shall be equal to theprincipal amount outstanding of the Loan Receivables comprised insuch Additional Pool as at the relevant Cut-Off Date and shall bepayable in accordance with the Pre-Enforcement Principal Priority ofPayments.

The Issuer shall purchase Additional Pools from the Originatorpursuant to a purchase agreement under the terms set out in the MasterTransfer Agreement subject to the occurrence, inter alia, of thefollowing conditions:

no Termination Event, as set out in the Master TransferAgreement, having occurred; and

the Additional Pool Requirements, as set out in the Master

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Transfer Agreement, having being met.

For additional features see section headed “Purchase of the Portfolio”.

Under the Master Transfer Agreement, the Originator has given certainrepresentations and warranties in favour of the Issuer in relation to,inter alia, the Portfolio, the relevant Loan Receivables, the relevantMortgages, the relevant Related Security and the relevant InsurancePolicies and has agreed to indemnify the Issuer in respect of certaincosts, expenses and liabilities of the Issuer incurred in connection withthe purchase and ownership of the Portfolio.

(See section headed “Purchase of the Portfolio”)

Servicing of the Portfolio Pursuant to a servicing agreement entered into 12 December 2007, asamended on 20 December 2007 (the “Servicing Agreement”),between the Issuer, the Representative of the Noteholders and DBMutui (in such capacity, the “Servicer”), the Servicer has agreed toadminister, service and collect all amounts payable by the Obligors inrespect of the Portfolio (the “Collections”) on behalf of the Issuer. Thereceipt of the Collections in respect of the Portfolio is theresponsibility of the Servicer.

The Servicer shall ensure proper segregation of the Issuer’s accountingand property from its own activities, and the Servicer, as “soggettoincaricato della riscossione dei crediti dei servizi di cassa epagamento”, shall be responsible for verifying that the transactions tobe carried out within the Securitisation comply with the provisions ofthe Securitisation Law, and are consistent with the contents of thisProspectus.

All amounts received by the Servicer in respect of the Portfolio willinitially be credited to the Originator Collection Account and suchamounts (other than the amounts equal to any Limited Recourse LoanAvailable Funds which shall be applied by the Servicer towardsrepayment of the relevant Limited Recourse Loan) shall be transferredby the Servicer into the Issuer Collection Account not later than theimmediately succeeding Business Day, as outlined in the sectionheaded “Servicing of the Portfolio”.

The Servicer has undertaken to prepare reports on a quarterly basis (the“Servicer Report”), in the form set out in the Servicing Agreementand submit on the Servicer Report Date, the Servicer Report to theIssuer, the Cash Manager, the Calculation Agent, the Representative ofthe Noteholders, the Corporate Servicer, the Lead Manager and theRating Agencies.

Cash Management Agreement Pursuant to a cash management agreement to be entered into on orprior to the Issue Date (the “Cash Management Agreement”),between the Issuer, the Representative of the Noteholders, theCalculation Agent, the Cash Manager, the Transaction Account Bank,the Italian Account Bank and DB Mutui, (i) the Transaction AccountBank has agreed to hold and operate the Issuer English Accounts andto provide the Issuer with account handling services in relation to

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monies or securities from time to time standing to the credit of suchaccounts; (ii) the Italian Account Bank has agreed to hold and operatethe Issuer Italian Accounts and to provide the Issuer with accounthandling services in relation to moneys from time to time standing tothe credit of such accounts; (iii) the Cash Manager has agreed to investmoney from time to time standing to the credit of the InvestmentAccount and the Cash Reserve Account in Eligible Investments; and(iv) the Calculation Agent has agreed to provide certain calculation,notification and reporting services to the Issuer.

In addition, each of the Account Banks has agreed, so long as each ofthe Issuer English Accounts and/or the Issuer Italian Accounts (as thecase may be) remains open with it, to pay to the Issuer interest on anycredit balance thereof at a rate as separately agreed between theTransaction Account Bank and/or the Italian Account Bank and theIssuer.

(See section headed “Summary of the Transaction Documents – CashManagement Agreement”).

Accounts The Issuer shall open and maintain the Issuer Italian Accounts with theItalian Account Bank (or another bank being an Eligible Institution).The Issuer Italian Accounts shall comprise:

(i) the Issuer Collection Account;

(ii) the Principal Reserve Account;

(iii) the Expenses Account;

(iv) the Payments Account; and

(v) the Equity Capital Account.

The Issuer shall open and maintain the Issuer English Accounts withthe Transaction Account Bank (or another bank being an EligibleInstitution). The Issuer English Accounts shall comprise:

(i) the Investment Account;

(ii) the Securities Account;

(iii) the Cash Reserve Account; and

(iv) the Class E Notes Principal Accumulation Account.

The Issuer Italian Accounts and the Issuer English Accounts aretogether referred to as the Issuer Accounts.

Pursuant to the Liquidity Facility Agreement, if a Standby Drawing ismade under the terms set out therein, the Issuer will open the LiquidityReserve Account on which such Standby Drawing will be credited.

For a description of the operation of the Issuer Accounts see section

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headed “Issuer Accounts and Cash Flows”.

Eligible Investments On the 15th calendar day and the last calendar day of each month(provided that, if any of such dates is not a Business Day, such datewill be the first following day that is a Business Day, and furtherprovided that such day is not a Payment Date), amounts standing to thecredit of the Investment Account and Cash Reserve Account may beinvested by the Cash Manager on behalf of the Issuer under the termsof the Cash Management Agreement in Eligible Investments which, ifrepresented by securities, shall be credited to the Securities Account.

On or prior to each Payment Date, the Cash Manager shall on behalf ofthe Issuer:

(i) liquidate the Eligible Investments standing to the credit of theSecurities Account and transfer the relevant proceeds thereof to theInvestment Account and the Cash Reserve Account (as appropriate);and

(ii) transfer all amounts standing to the credit of the InvestmentAccount to the Payments Account. On each Payment Date, the CashManager and the Paying Agents, shall, in compliance with thePayments Report, apply the amounts so transferred to the PaymentsAccount in accordance with the Priority of Payments.

For a description of the investment in and liquidation of the EligibleInvestments see section headed “Credit Structure – Issuer Accounts –Eligible Investments”.

4. PRIORITY OF PAYMENTS AND CREDIT STRUCTURE

Application of FundsPre-Enforcement

On each Payment Date, the Issuer will apply the Available Funds inaccordance with Condition 5 (Order of Priority). The Issuer will, priorto the service of an Issuer Enforcement Notice or the occurrence of anIssuer Insolvency Event (including on the Maturity Date of the Notes),apply the Available Funds in the order of priority provided in the Pre-Enforcement Priority of Payments.

See section headed “Terms and Conditions of the Notes”.

Application of FundsPost-Enforcement

Following service of an Issuer Enforcement Notice or the occurrenceof an Issuer Insolvency Event, all amounts received or recovered bythe Issuer and/or the Representative of the Noteholders in respect ofthe Portfolio (excluding any Limited Recourse Loan Available Funds)and/or the Issuer Security and/or the Transaction Documents will beapplied in accordance with the Enforcement Priority of Payments.

See section headed “Terms and Conditions of the Notes”.

Cash Reserve On the Issue Date, the Issuer shall credit an amount equal to the CashReserve Amount into the Cash Reserve Account. If, on anyCalculation Date, the Income Available Funds (with the exception ofitems (b), (c) and (d) thereof), are not sufficient to enable the Issuer tomake payment for items (a) to (t) (inclusive) of the Pre-Enforcement

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Interest Priority of Payments (as calculated on such Calculation Date),the Issuer shall be entitled, on the immediately following CashReserve Drawdown Date, to draw on the Cash Reserve in an amountequal to the Cash Reserve Drawing Amount for application inaccordance with the Pre-Enforcement Interest Priority of Payments tocover such shortfall. Subject to the sufficiency of funds available tothe Issuer for such purpose and the Pre-Enforcement Interest Priorityof Payments, the Issuer shall at all times maintain an amount in theCash Reserve Account equal to the Cash Reserve Required Amount.

See Section headed “Credit Structure – Cash Reserve”.

Liquidity Facility Pursuant to the Liquidity Facility Agreement, the Liquidity Providerwill provide a renewable 364 day committed facility in a maximumaggregate principal amount of the Liquidity Facility Amount whichwill be available to be drawn by the Issuer if, on any Calculation Dateprior to the service of an Issuer Enforcement Notice or the occurrenceof an Issuer Insolvency Event, the Income Available Funds (with theexception of items (c) and (d) thereof), are not sufficient to enable theIssuer to make payment for items (a) to (j) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated on suchrelevant Calculation Date).

If the Liquidity Provider (i) declines to renew its commitment underthe Liquidity Facility and/or (ii) ceases to be an Eligible Institution and(iii) is unable to procure a replacement Liquidity Provider (which shallbe an Eligible Institution) to provide a facility on the same terms asthose provided under the Liquidity Facility Agreement, the Issuer maydraw down, in accordance with the terms set out in the LiquidityFacility Agreement, the then available commitment under theLiquidity Facility (a “Standby Drawing”) and deposit such amountinto the Liquidity Reserve Account.

See section headed “Credit Structure – Liquidity Facility”.

Credit Trigger Events Following the occurrence of a Class B Credit Trigger Event and at alltimes thereafter, payments in respect of interest on the Class B Noteswill be subordinated to the payment of interest on the Class A Notesand other items ranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments.

Following the occurrence of a Class C Credit Trigger Event and at alltimes thereafter, payments in respect of interest on the Class C Noteswill be subordinated to the payment of interest on the Class A and theClass B Notes and other items ranking in priority thereto in accordancewith the Pre-Enforcement Interest Priority of Payments.

Following the occurrence of a Class D Credit Trigger Event and at alltimes thereafter, payments in respect of interest on the Class D Noteswill be subordinated to the payment of interest on the Class A Notes,the Class B Notes and the Class D Notes and other items ranking inpriority thereto in accordance with the Pre-Enforcement InterestPriority of Payments.

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Following the occurrence of a Class E Credit Trigger Event and at alltimes thereafter, payments in respect of interest on the Class E Noteswill be subordinated to the payment of interest on the Class A Notes,the Class B Notes, the Class C Notes and the Class D Notes and otheritems ranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments.

The effect of the Credit Trigger Events is to subordinate the interestpayments on the Class B Notes, the Class C Notes, the Class D Notesand the Class E Notes, as the case may be, to the reduction of therelevant Principal Deficiency Sub-Ledgers and the increase of thePrincipal Available Funds by previously covered Shortfall Amounts asspecified in the Pre-Enforcement Interest Priority of Payments.

Once a Credit Trigger Event has occurred, it cannot subsequently berectified in order to restore the application of funds to the position thatapplied immediately prior to such Credit Trigger Event occurring.

Pursuant to the Cash Management Agreement, the Calculation Agentshall verify, on each Calculation Date, the occurrence of a CreditTrigger Event; the outcome of such verification together with therelevant details will be reported in the relevant Payments Report.

See “Terms and Conditions of the Notes – 5 - Order of Priority – 5.1Pre-Enforcement Interest Priority of Payments”.

Principal Deficiency Sub-Ledger On each Calculation Date the Issuer shall enter or procure to beentered (A) as a debit the principal amount of each Loan Receivable inthe Portfolio arising from Loans which have been classified asDefaulted Loan Receivables during the immediately precedingCollection Period: (a) up to the then aggregate Principal AmountOutstanding of the Class E Notes, on the Class E Principal DeficiencySub-Ledger; and/or (b) thereafter, up to the then aggregate PrincipalAmount Outstanding of the Class D Notes, on the Class D PrincipalDeficiency Sub-Ledger; and/or (c) thereafter, up to the then PrincipalAmount Outstanding of the Class C Notes, on the Class C PrincipalDeficiency Sub-Ledger; and/or (d) thereafter, up to the then PrincipalAmount Outstanding of the Class B Notes, on the Class B PrincipalDeficiency Sub-Ledger, and/or (e) thereafter, up to the then PrincipalAmount Outstanding of the Class A Notes, on the Class A PrincipalDeficiency Sub-Ledger, as the case may be, in each case taking intoaccount any amount previously entered as a debit on each suchPrincipal Deficiency Sub-Ledger and in respect of which funds havenot yet been allocated in accordance with the Pre Enforcement InterestPriority of Payments.

Interest Rate Swap Agreement The Issuer will enter into one or more swap transactions in order tomitigate the interest rate exposure which may arise as a result ofdifferences between fixed rates of interest payable under the ModularLoans (in the event that Borrowers exercise their option under theModular Loans to convert their interest rates from floating to fixedrates of interest) and the floating rates at which the Notes bear interest.

The Hedging Counterparty is subject to certain conditions as set out in

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the Interest Rate Swap Agreement.

See section headed “Credit Structure – Interest Rate Matching” forfurther information.

Interest Rate Cap Agreement The Issuer will enter into an interest rate cap transaction in order tomitigate the interest rate exposure which may arise as a result offluctuations in Euribor which may cause its floating interest rateobligations under the Rated Notes to exceed the rate of returngenerated by the Loans comprised in the Portfolio.

The Hedging Counterparty is subject to certain conditions as set out inthe Interest Rate Cap Agreement.

See section headed “Credit Structure – Interest Rate Matching” forfurther information.

5. OTHER PRINCIPAL TRANSACTION DOCUMENTS

Agency Agreement Pursuant to the Agency Agreement, to be entered into on or prior to theIssue Date, the Italian Paying Agent will arrange on behalf of theIssuer for the payment of interest and repayment of principal on theNotes, and (ii) the Additional Paying Agent will agree to providecertain agency services in relation to the Notes under the terms set outtherein.

The Agency Agreement shall be governed by Italian law.

Intercreditor Agreement Pursuant to the Intercreditor Agreement, the Pledge Agreement and theConditions, the Representative of the Noteholders will, following theservice of an Issuer Enforcement Notice on the Issuer or theoccurrence of a Issuer Insolvency Event, hold and exercise the IssuerSecured Creditors’ rights under the Pledge Agreement for the accountand benefit of the Issuer Secured Creditors.

Under the terms of the Intercreditor Agreement, the Issuer willundertake, following the service of an Issuer Enforcement Notice orthe occurrence of an Issuer Insolvency Event, to comply with alldirections of the Representative of the Noteholders in relation to themanagement and administration of the Portfolio.

The Issuer will also grant an irrevocable mandate in favour of theRepresentative of the Noteholders to take, following the service of anIssuer Enforcement Notice, such action in the name of the Issuer as theRepresentative of the Noteholders may deem necessary to protect theinterests of the Issuer Secured Creditors in respect of the Portfolio,including the sale thereof.

The mandate conferred by the Issuer upon the Representative of theNoteholders by the Intercreditor Agreement shall also take effect uponthe occurrence of a Specified Event, but only in relation to the powersand authority needed by the Representative of the Noteholders toenforce the rights entitlements or remedies, to exercise the discretion,authorities or powers, to give the direction or make the determination

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in respect of which the Specified Event has occurred. Upon theoccurrence of a Specified Event, the Representative of the Noteholderswill have the right to exercise, in the name and on behalf of the Issuerand in the interest and for the benefit of the Noteholders and the OtherIssuer Secured Creditors, the rights of the Issuer under the TransactionDocuments to which the Specified Event relates.

Pursuant to the Intercreditor Agreement and the Conditions, the IssuerSecured Creditors have appointed the Representative of theNoteholders as their agent (mandatario con rappresentanza) inaccordance with the provisions of Articles 1723, second paragraph and1726 of the Italian Civil Code and authorised the Representative of theNoteholders, inter alia, to receive, following the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event,on behalf of the Issuer Secured Creditors all monies payable by theIssuer to the Issuer Secured Creditors and to apply such amounts inaccordance with the applicable Priority of Payments.

The Intercreditor Agreement shall be governed by Italian law.

See section headed “Summary of the Transaction Documents –Intercreditor Agreement”.

Pledge Agreement Under the terms of the Pledge Agreement to be entered into on or priorto the Issue Date, the Issuer will grant in favour of the Representativeof the Noteholders, as agent (mandatario con rappresentanza) for theNoteholders and the Other Issuer Secured Creditors, a pledge over allthe Issuer’s monetary rights (other than the Portfolio and the relevantCollections) in, to and under:

(a) the Rated Notes Subscription Agreement;

(b) the Class Z Notes Subscription Agreement;

(c) the Master Transfer Agreement and each Purchase Agreement;

(d) the Servicing Agreement;

(e) the Cash Management Agreement;

(f) the Agency Agreement;

(g) the Intercreditor Agreement;

(h) the Corporate Services Agreement;

(i) the Quotaholder and Undertakings Agreement; and

(j) the Liquidity Facility Agreement,

all as more particularly provided in the Pledge Agreement.

The Pledge Agreement shall be governed by Italian law.

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See section headed “Summary of the Transaction Documents –PledgeAgreement”.

Deed of Charge Pursuant to the Deed of Charge to be entered into on or prior to theIssue Date, to secure the Issuer Secured Obligations, the Issuer willcreate, inter alia, security in favour of the Representative of theNoteholders, on trust for the benefit of itself, the Noteholders and theOther Secured Creditors, as follows:

(a) an assignment by way of a first fixed security of the right, title,interest and benefit, present and future, in, to and under theHedging Agreements;

(b) a first fixed charge over all sums of money standing to thecredit of the Issuer English Accounts;

(c) a first floating charge over the whole of its undertaking and allof its property and assets whatsoever and wheresoever situate,present and future, other than any property or assets from timeto time or for the time being effectively charged by way offixed charge, or otherwise assigned as security.

Pursuant to the Deed of Charge, the Representative of the Noteholderswill, following the service of an Issuer Enforcement Notice on theIssuer or the occurrence of an Issuer Insolvency Event, hold andexercise the Issuer Secured Creditors’ rights under the Deed of Chargefor the account and benefit of the Issuer Secured Creditors.

The Deed of Charge shall be governed by English law.

See section headed “Summary of the Transaction Documents – Deed ofCharge”.

Quotaholder and UndertakingsAgreement

Pursuant to the Quotaholder and Undertakings Agreement to beentered into on or about the Issue Date between the Issuer, theRepresentative of the Noteholders and the Quotaholder, theQuotaholder (i) has assumed certain undertakings with respect to, interalia, the exercise of its voting rights in the Issuer, and (ii) hasundertaken not to dispose of its interest in the Issuer.

The Quotaholder and Undertakings Agreement shall be governed byItalian law.

See section headed “Summary of the Transaction Documents –Quotaholder and Undertakings Agreement”.

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RISK FACTORS

The following is a summary of certain aspects of the issue of the Notes of which prospective Noteholdersshould be aware. It is not intended to be exhaustive and prospective Noteholders should also read thedetailed information set out elsewhere in this Prospectus before deciding whether to invest in the Notes.

SUITABILITY

Structured securities, such as the Notes, are sophisticated instruments, which can involve a significant degreeof risk. Prospective investors in any Class of the Notes should ensure that they understand the nature of theNotes and the extent of their exposure to the relevant risk. Prospective investors should also ensure that theyhave sufficient knowledge, experience and access to professional advice to make their own legal, tax,accounting and financial evaluation of the merits and risks of investment in the Notes and that they considerthe suitability of the Notes as an investment in the light of their own circumstances and financial condition.

STRUCTURAL CONSIDERATIONS

Source of payments to holders of the Notes

The Notes will be limited recourse obligations solely of the Issuer. In particular, the Notes will not beobligations or responsibilities of, or guaranteed by, any of the Quotaholder, the Representative of theNoteholders, the Italian Paying Agent, the Additional Paying Agent, the Cash Manager, the CalculatingAgent, the Transaction Account Bank, the Italian Account Bank, the Liquidity Provider, the Originator, theServicer, the Corporate Servicer, the Hedging Counterparty, the Lead Manager, the Arranger, theBookrunner, the Class Z Notes Subscriber (in each case, such person in any capacity in which it is acting), orany other person except the Issuer. Furthermore, none of such persons accepts any liability whatsoever inrespect of any failure by the Issuer to make any payment of any amount due on the Notes.

The Issuer’s principal asset is the Portfolio. The Issuer will not as of the Issue Date and thereafter have anysignificant assets other than the Initial Pool and any Additional Pool (if any) which shall be purchased by theIssuer under the Master Transfer Agreement and the relevant Purchase Agreement, the Collections from (andincluding) the relevant Cut-Off Date and its rights under the Transaction Documents to which it is a party.Therefore, there is no assurance that, over the life of the Notes or at the redemption date of the Notes(whether on maturity or upon redemption by acceleration of maturity upon the Representative of theNoteholders giving the Issuer an Issuer Enforcement Notice following the occurrence of an Event of Defaultor an Issuer Insolvency Event or otherwise), there will be sufficient funds to enable the Issuer to repay theNotes in full.

Upon enforcement of the Issuer Security, the Representative of the Noteholders will have recourse only tothe Portfolio and the assets pledged and charged pursuant to the Security Documents. Other than as providedfor in the Master Transfer Agreement and the Servicing Agreement, the Issuer and the Representative of theNoteholders will have no recourse to the Originator or any other entity and the only remedy available to theNoteholders and the Other Issuer Secured Creditors in connection with the enforcement of the IssuerSecurity is the exercise by the Representative of the Noteholders of the Issuer’s rights under the TransactionDocuments.

The ability of the Issuer to meet its obligations in respect of the Notes will be dependent on the dueperformance by the parties to the Transaction Documents of their respective obligations. Without limitation,the payment by the Issuer of amounts due on the Notes depends on receipt by the Issuer of Collections fromthe Servicer in respect of the Portfolio, any payments to be made by the Hedging Counterparty under theInterest Rate Swap, any other amounts to be received by the Issuer pursuant to the terms of the TransactionDocuments (including any Facility Drawings) and any indemnity amount to be received from the InsuranceCompanies.

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If any Borrowers default under the relevant Loan Agreement(s) and, after (i) the exercise by the Servicer ofavailable remedies in respect of the Loan Agreements, the Mortgages and the other Related Securities and(ii) a claim has been made for indemnity under the relevant Insurance Policy, the Issuer does not receive thefull amount due from those Borrowers, Guarantors or the relevant Insurance Company (as the case may be),then holders of the Class Z Notes will, and the holders of the other Notes may, receive by way of principalrepayment an amount less than the face value of the Notes, and the Issuer may be unable to pay in fullinterest due on the Notes.

In addition, the ability of Borrowers to repay the Receivables may be also affected by adverse changes inmacroeconomic conditions affecting the Republic of Italy.

Liquidity and credit risk

The Issuer is subject to the risk of delay arising between the receipt of payments due from Borrowers and thescheduled Payment Dates.

The Issuer is also subject to the risk of, amongst other things, default in payment by the Borrowers and thefailure by the Servicer to collect or recover sufficient funds in respect of the Receivables in order to enablethe Issuer to discharge all amounts payable under the Notes in full as they fall due.

These risks are mitigated in part by the ability of the Issuer, in accordance with the Pre-Enforcement Priorityof Payments, to re-allocate the Potential Capital Funds to meet payments of interest on the Class A Notes,the Class B Notes, the Class C Notes, the Class D Notes and the Class E Notes and certain other itemsranking in priority thereto.

In addition, these risks are in part addressed in relation to the Class A Notes, the Class B Notes, the Class CNotes, the Class D Notes and the Class E Notes by the credit support provided by:

(i) subordination of the Notes of each Class ranking lower in the applicable Priority of Payments if thePro rata Conditions are not met;

(ii) in respect of the Class A Notes, the provisions relating to Class B Credit Trigger Event, whichprovides that upon its occurrence and at all times thereafter, payments in respect of interest on theClass B Notes will be subordinated to the payment of interest on the Class A Notes and other itemsranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments;

(iii) in respect of the Class A Notes and the Class B Notes, the provisions relating to Class C CreditTrigger Event providing that, upon its occurrence and at all times thereafter, payments in respect ofinterest on the Class C Notes will be subordinated to the payment of interest on the Class A Notesand the Class B Notes and other items ranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments;

(iv) in respect of the Class A Notes, the Class B Notes and the Class C Notes, the provisions relating toClass D Credit Trigger Event providing that, upon its occurrence and at all times thereafter(regardless of whether or not such Class D Credit Trigger Event is still subsisting), payments inrespect of interest on the Class D Notes will be subordinated to the payment of interest on the ClassA Notes, the Class B Notes and the Class C Notes and other items ranking in priority thereto inaccordance with the Pre-Enforcement Interest Priority of Payments;

(v) in respect of the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes, theprovisions relating to Class E Credit Trigger Event providing that, upon its occurrence and at alltimes thereafter (regardless of whether or not such Class E Credit Trigger Event is still subsisting),payments in respect of interest on the Class E Notes will be subordinated to the repayment of interest

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on the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes and other itemsranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments.

(vi) the Cash Reserve; and

(vii) the Liquidity Facility.

There can be, however, no assurance that the levels of credit support provided will be adequate to ensuretimely and full payment of all amounts due under each Class of Rated Notes.

Market for the Notes

There is currently no market for the Notes, but application has been made for the Rated Notes to be listed onthe Irish Stock Exchange. While the Lead Manager or its agent may make a market in the Rated Notes, noperson is under any obligation to do so.

There is not, at present, any active and liquid secondary market for the Notes. There can be no assurance thata secondary market for the Notes will develop or, if a secondary market does develop, that it will provideNoteholders with liquidity of investment or that it will continue for the life of the Notes. To date, nounderwriter has indicated that they intend to establish a secondary market in the Notes. Therefore anypurchaser of the Rated Notes must be prepared to hold such Notes to the final redemption or cancellation.

Further, the secondary mortgage markets are currently experiencing severe disruptions resulting fromreduced investor demand for mortgage loans and mortgage-backed securities and increased investment yieldrequirements for those loans and securities. As a result, the secondary market for mortgage-backed securitiesis experiencing extremely limited liquidity. These conditions may continue or worsen in the future.

Limited liquidity in the secondary market for mortgage-backed securities has had a severe adverse effect onthe market value of mortgage-backed securities. Limited liquidity in the secondary market may continue tohave a severe adverse affect on the market value of mortgage-backed securities, especially those securitiesthat are more sensitive to prepayment, credit or interest rate risk and those securities that have beenstructured to meet the investment requirements of limited categories of investors. Consequently, an investorin the Notes may not be able to sell its notes readily. The market values of the Notes are likely to fluctuate.Any of these fluctuations may be significant and could result in significant losses to such investor.

In addition, the forced sale into the market of mortgage-backed securities held by structured investmentvehicles, hedge funds, issuers of collateralised debt obligations and other similar entities that are currentlyexperiencing funding difficulties could adversely affect an investor’s ability to sell, and/or the price aninvestor receives for, the Notes in the secondary market

No independent investigation in relation to the Loan Receivables

None of the Issuer, the Representative of the Noteholders, the Lead Manager, the Arranger or any other partyto the Transaction Documents (other than the Originator) has undertaken, or will undertake, anyinvestigations, searches or other actions to verify the details of the Loan Receivables comprised in thePortfolio or to establish the creditworthiness of any Obligor or to establish the value of the Mortgages or theLoan Agreements.

The Issuer will rely solely on representations and warranties given by the Originator in respect of the InitialPool and any Additional Pool under the Master Transfer Agreement concerning, inter alia, the LoanReceivables, the Obligor, the Mortgages and the Loan Agreements as of the relevant Cut-Off Date and therelevant Transfer Date (and repeated by the Originator on the Issue Date).

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The only remedies of the Issuer in respect of the occurrence of a breach of a representation and warrantywhich materially and adversely affects the value of a Loan Receivable will be the requirement that theOriginator indemnifies the Issuer for the damage deriving therefrom or grants a limited recourse loan to theIssuer for an amount which is equal to the individual purchase price of such Loan Receivable (as increasedby costs and expenses suffered by the Issuer in respect thereof) (See section headed “Summary of theTransaction Documents – Master Transfer Agreement”). In the event of a claim for loss by the Issuer againstthe Originator for breach of a representation and warranty, there is no assurance that the Originator will havethe resources to indemnify the Issuer or grant a limited recourse loan to it as described above.

Subordination and credit enhancement

In respect of the Issuer’s obligations under the Notes, the Conditions and the Intercreditor Agreementprovide that the Notes of each Class shall rank pari passu without preference or priority amongst themselves,provided that:

(a) In respect of the obligation of the Issuer to pay interest on the Notes, prior to the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event, (i) the Class A Notes will rankpari passu and pro rata among themselves and in priority to the Class B Notes, the Class C Notes,the Class D Notes, the Class E Notes and the Class Z Notes; (ii) the Class B Notes will rank paripassu and pro rata among themselves and in priority to the Class C Notes, the Class D Notes, theClass E Notes and the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class C Noteswill rank pari passu and pro rata among themselves and in priority to the Class D Notes, the Class ENotes and the Class Z Notes, but subordinated to the Class A Notes and the Class B Notes; (iv) theClass D Notes will rank pari passu and pro rata among themselves and in priority to the Class ENotes and the Class Z Notes, but subordinated to the Class A Notes, the Class B Notes and the ClassC Notes; (v) the Class E Notes will rank pari passu and pro rata among themselves and in priority tothe Class Z Notes, but subordinated to the Class A Notes, the Class B Notes, the Class C Notes andthe Class D Notes; (vi) the Class Z Notes will rank pari passu and pro rata among themselves butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes under the terms set out in Condition 5.1 (Order of Priority – Pre-Enforcement InterestPriority of Payments).

(b) in respect of the obligation of the Issuer to repay principal of the Notes, prior to the service of anIssuer Enforcement Notice or the occurrence of an Issuer Insolvency Event:

(A) If Pro rata Amortisation Conditions are not met: (i) the Class A Notes will rank pari passuand pro rata without any preference or priority among themselves and in priority to theClass B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class ZNotes; (ii) the Class B Notes will rank pari passu and pro rata without any preference orpriority among themselves and in priority to the Class C Notes, the Class D Notes, the ClassE Notes and the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class CNotes will rank pari passu and pro rata without any preference or priority amongthemselves and in priority to the Class D Notes, the Class E Notes and the Class Z Notes,but subordinated to the Class A Notes and the Class B Notes; (iv) the Class D Notes willrank pari passu and pro rata without any preference or priority among themselves and inpriority to the Class E Note and the Class Z Notes, but subordinated to the Class A Notes,the Class B Notes, the Class C Notes; (v) the Class E Notes will rank pari passu and prorata without any preference or priority among themselves and in priority to the Class ZNotes, but subordinated to the Class A Notes, the Class B Notes, the Class C Notes and theClass D Notes; (vi) the Class Z Notes will rank pari passu and pro rata without anypreference or priority among themselves and subordinated to the Class A Notes, the Class BNotes, the Class C Notes, the Class D Notes and the Class E Notes; and

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(B) if the Pro rata Amortisation Conditions are met on any Calculation Date, then on theimmediately following Payment Date, the Class A Notes, the Class B Notes, the Class CNotes, the Class D Notes and the Class E Notes will rank pari passu and pro rata withoutany preference or priority among themselves under the terms set out in Condition 5.2, whilstthe Class Z Notes will rank pari passu and pro rata without preference of priority amongthemselves and subordinated to the Rated Notes of all Classes (Order of Priority – Pre-Enforcement Principal Priority of Payments).

(c) Following the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent, (i) the Class A Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal and in priority tothe Class B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes forall purposes; (ii) the Class B Notes will rank pari passu and pro rata without any preference orpriority among themselves in respect of payments of interest and of repayment of principal and inpriority to the Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes, butsubordinated to the Class A Notes; (iii) the Class C Notes will rank pari passu and pro rata withoutany preference or priority among themselves in respect of payments of interest and of repayment ofprincipal and in priority to the Class D Notes, the Class E Notes and the Class Z Notes, butsubordinated to the Class A Notes and the Class B Notes; (iv) the Class D Notes will rank pari passuand pro rata without any preference or priority among themselves in respect of payments of interestand of repayment of principal and in priority to the Class E Notes and the Class Z Notes, butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes; (v) the Class E Notes willrank pari passu and pro rata without any preference or priority among themselves in respect ofpayments of interest and of repayment of principal and in priority to the Class Z Notes, butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes; (vi)the Class Z Notes will rank pari passu and pro rata without any preference or priority amongthemselves for all purposes and subordinated in respect of payments of interest and of repayment ofprincipal to the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes, under the terms set out in Condition 5.5 (Order of Priority –Enforcement Priority ofPayments).

The Notes of each Class are subordinated in point of both payment of interest and repayment of principal tothe rights of the Other Issuer Secured Creditors ranking higher than that Class in accordance with theapplicable Priority of Payments and are subordinated generally to the claims of all Connected Third PartyCreditors of the Issuer.

Yield and repayment considerations

The yield to maturity of the Notes of each Class will depend, inter alia, on the amount and timing ofrepayments or prepayments of principal under the Loan Agreements. Such yield may therefore be affectedby a higher or lower than anticipated rate of prepayments under the Loan Agreements by the Borrowers.Borrowers are, in general, entitled to prepay under the Loan Agreements at any time, subject in certainlimited circumstances to the payment of a prepayment fee in accordance, inter alia, with Article 40 of theItalian Banking Act (see paragraph below headed “Decree 31 January 2007, No. 7”). Prepayments of LoanAgreements may occur as a consequence of, inter alia, the refinancing or sale of properties subject to therelevant Mortgages by Borrowers, the application of the proceeds of building insurance policies in relation toproperties subject to the relevant Mortgages by Borrowers or as a result of the application of the proceeds ofenforcement proceedings in relation to defaulted Loan Agreements or in case of exercise by the Borrower ofthe faculty set forth in Article 1202 of the Italian Civil Code pursuant to Article 8 of the Decree 31 January2007, No. 7 (see paragraph below this section headed “Decree 31 January 2007, No. 7”). The rate ofprepayment of the Loan Agreements cannot be predicted and is influenced by a wide variety of economic,social and other factors, including prevailing mortgage loan market interest rates, prevailing margins offeredby the banking system and the availability of alternative financing and local and regional economic

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conditions. The stream of principal payments received and the yield to maturity which will be experiencedby a Noteholder cannot be assured, given that the level of prepayments under the Loan Agreements cannotbe predicted by the Issuer.

Prior to the delivery of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, at anytime after the later of the expiry of the Initial Period and the Payment Date on which the aggregate principalamount outstanding of the Portfolio is equal to or less than 10% of the Initial Principal Amount of thePortfolio the Issuer may redeem all, but not some only of, the Notes (or the Rated Notes, as applicable) attheir Principal Amount Outstanding (plus any accrued but unpaid interest) in accordance with theEnforcement Priority of Payments and subject to the Issuer having sufficient funds to redeem (i) all the Notesand to make all payments ranking in priority thereto, or pari passu therewith, or (ii) the Rated Notes and tomake all payments ranking in priority thereto, or pari passu therewith, but not the Class Z Notes, and theClass Z Noteholders have consented to such redemption, subject as provided inter alia in Condition 7(d)(Redemption, Purchase and Cancellation – Early redemption by the Issuer). The yield to maturity of theNotes may also be affected by the exercise or non-exercise by the Issuer of such option.

Prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, eachPut Option Noteholder shall have the option to offer all (but not only part of) the Rated Notes held by it tothe Issuer for redemption at their Redemption Value on each Put Date and, subject to a number of Put OptionNoteholders at least equal to the Put Option Quorum having exercised the Put Option, the Notes will beredeemed on the First Put Date or later Put Date at their Redemption Value in accordance with Condition 7(e) (Redemption of the Notes at the option of the Put Option Noteholders). The yield to maturity of the Notesmay also be affected by the exercise or non-exercise by the Issuer of such option.

Purchase of Additional Pools – Substitution Option

Subject to the Originator being able to generate sufficient Loan Receivables which meet the Additional PoolRequirements, and satisfaction of the conditions for the acquisition of Additional Pools (including noTermination Event having occurred and the Additional Pool Requirements having been met), it is theintention of the Originator to offer to sell Additional Pools to the Issuer in addition to the Initial Poolpurchased by the Issuer as of the Execution Date on the same terms and conditions during the remainder ofthe Revolving Period. (See section headed “Purchase of the Portfolio”). Subject to the terms and conditionsset out in the Master Transfer Agreement, the Issuer shall purchase any Additional Pool offered for sale, if somade. However, there is no guarantee as to the frequency of the use of the substitution option, the amount ofmoneys which will be available to the Issuer to exercise the substitution option or the amount of LoanReceivables which may be available to be purchased pursuant thereto during the remainder of the RevolvingPeriod.

Interest Rate Risk

Interest on the Rated Notes is payable at a rate equal to Euribor plus the applicable margin.

The majority of the Loans will, throughout the term thereof, accrue interest at the rate of three month Euriborwith the relevant rate of Euribor set on a date corresponding to that of fixing of the Euribor on the RatedNotes. However, a small proportion of the Loans will accrue interest at a variety of fixed rates throughouttheir term (the Fixed Rate Loans).

Certain Loans (the Modular Loans) give the relevant Borrower the option to change the interest ratepayable from a floating rate to a fixed rate based on prevailing market rates on the third anniversary of takingout such Loan and at three yearly intervals thereafter.

In the event that the fixed rates (in relation to the Fixed Rate Loans and the Modular Loans) and Euribordiverge such that Euribor is significantly higher than the relevant fixed rates, the Issuer may not receivesufficient income from the Portfolio to meet its obligations due under the Notes.

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The exposure of the Issuer to the Modular Loans in respect of which the relevant Borrowers have opted forfixed interest rates will be hedged by the Interest Rate Swaps with the Hedging Counterparty (as describedmore fully under the section entitled Credit Structure –Interest Rate Swaps).

The Issuer’s exposure to the Fixed Rate Loans will not be hedged on the basis that they will constitute on theIssue Date only approximately 3.07 per cent. of the Portfolio and therefore are not considered to materiallyimpair the ability of the Issuer to meet its obligations to make payments under the Notes by virtue of theirinterest rate characteristics.

The Issuer’s ability to meet its obligations under the Notes derives primarily from Collections obtained fromthe Portfolio. The Issuer is exposed to the risk that fluctuations in Euribor may cause its floating interest rateobligations under the Rated Notes to exceed the rate of return generated by the Loans comprised in thePortfolio. To address this risk in relation to the Rated Notes, the Issuer will enter into the Interest Rate CapAgreement. The protection provided by the Interest Rate Cap Agreement may cease to be available orsufficient for reasons including the Hedging Counterparty’s failing to perform its obligations on any paymentdate under the relevant Interest Rate Cap Agreement, the Interest Rate Cap Agreement being terminated.

Risks in respect of the Hedging Agreements

If the Hedging Counterparty terminates any of the Hedging Agreements or if the Hedging Counterpartydefaults in its obligations to make payments of amounts determined by reference to Euribor under any of theHedging Agreements, the Issuer will be exposed to changes in interest rates and could have insufficientfunds to enable it to make payments under the Notes.

If the Hedging Counterparty defaults under any of the Hedging Agreements, the Issuer will have the rightunder certain circumstances to terminate such Hedging Agreement. Upon such termination the Issuer isobliged to obtain a replacement hedging agreement. There can be no assurance that a suitable replacementhedging agreement could be obtained or that the Issuer would have sufficient funds to make payments whichmay be required to be paid to the relevant replacement hedging agreement provider depending on the termsof the replacement hedging agreement and prevailing market rates. Unless a suitable replacement hedgingagreement is entered into, the Issuer would be exposed to interest rate risks in connection with the Notes.

Administration and reliance on third parties

The ability of the Issuer to meet its obligations under the Notes is dependent on the performance of the otherparties to the Transaction Documents; in particular, the due performance of the Originator of its obligationsunder each of the Master Transfer Agreement, the ability of the Servicer to service the Portfolio inaccordance with its obligations under the Servicing Agreement, the performance of the HedgingCounterparty under and the continued availability of the Hedging Agreements, the ability of the LiquidityProvider to comply with its obligations arising under the Liquidity Facility Agreement and the performanceof the Insurance Companies under the relevant Insurance Policy.

If events occur which give the Issuer the right to terminate the appointment of the Servicer under theServicing Agreement, it is necessary for the Issuer to appoint a successor servicer (such appointment to benotified in writing to the Rating Agencies and subject to confirmation by the Rating Agencies (other thanMoody’s) that such appointment does not entail any material adverse effect of the then rating of the RatedNotes) before any termination of the Servicer’s appointment will become effective (See section headed“Servicing of the Portfolio”). Such successor servicer would be required to assume responsibility for theprovisions of the services required to be performed by the Servicer under the Servicing Agreement executinga servicing agreement substantially in the form of the Servicing Agreement and acceding to the IntercreditorAgreement. There can be no assurance that a successor servicer will be found or that any successor servicerwill be willing to accept such appointment at the terms and conditions of the Servicing Agreement. However,under the terms of the Servicing Agreement, the Servicer has undertaken, following certain events (as betterdescribed under the section headed “Servicing of the Portfolio”) to identify an entity meeting certain

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requirements which shall act as successor servicer following termination of the Servicer’s appointment. If asuccessor servicer is appointed as servicer and the Servicer’s appointment terminated, the ability of asuccessor servicer to perform fully the required services will depend, inter alia, on the information, softwareand records available to it at the time of its appointment. Therefore, there is no assurance that a substituteservicer will be able to assume and perform the obligations of the Servicer. The Representative of theNoteholders has no obligation to assume the role or responsibilities of the Servicer or to appoint a successorservicer.

Similarly to other financial institutions, the performance of the Italian economy will have a significantimpact on the Originator as its activities are concentrated in Italy. A severe or extended downturn in Italy’seconomy could adversely affect the results of operations and the financial condition of the Originator whichcould in turn affect its ability to perform its obligations under the Transaction Documents to which it is aparty.

Forecasts

Forward-looking statements, any other projections, forecasts and estimates in this Prospectus, are necessarilyspeculative and subjective in nature and some or all of the assumptions underlying the projections may notmaterialise or may vary significantly from actual results.

Such statements are subject to risks and uncertainties that could cause the actual results to differ materiallyfrom those expressed or implied by such forward-looking statements. Prospective investors are cautioned notto place undue reliance on these forward-looking statements, which speak only as of the date of thisProspectus and are based on assumptions that may prove to be inaccurate. No-one undertakes any obligationto update or revise any forward-looking statements contained herein to reflect events or circumstancesoccurring after the date of this Prospectus.

Events affecting the ratings of the Rated Notes

The credit ratings which will be assigned to the Rated Notes by the Rating Agencies on the Issue Date(which are expected to be (i) for the Class A Notes, “Aaa” by Moody’s and “AAA” by S&P; (ii) for theClass B Notes, “Aa2” by Moody’s and “AA” by S&P; (iii) for the Class C Notes, “A1” by Moody’s and “A”by S&P; (iv) for the Class D Notes, “Baa2” by Moody’s and “BBB-“ by S&P, (v) for the Class E Notes,“B3” by Moody’s will be based on a number of different factors including the credit quality of theReceivables, the transaction structure and documentation, the debt ratings of the Transaction Account Bank,the Italian Account Bank, the Paying Agents, the Hedging Counterparty, the Liquidity Provider and reflectthe views of the Rating Agencies.

Future events such as any deterioration of the Portfolio, the unavailability or the delay in the delivery ofinformation, the failure by the parties to the Transaction Documents to perform their obligations under theTransaction Documents and the revision, suspension or withdrawal of the unsecured, unsubordinated andunguaranteed debt rating of third parties involved in the Securitisation could have an adverse impact on thecredit ratings of the Rated Notes, which may be subject to revision or withdrawal at any time by theassigning Rating Agency.

In addition, in the event of downgrading of the unsecured, unsubordinated and unguaranteed debt rating ofthird parties involved in the Securitisation, there is no guarantee that the Issuer will be in a position to securea replacement for the relevant third party or there may be a significant delay in securing such a replacementand, consequently, the rating of the Rated Notes may be affected.

In any event, a credit rating is not a recommendation to buy, sell or hold securities.

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The Representative of the Noteholders – Limited enforcement rights for Noteholders

The Intercreditor Agreement contains provisions requiring the Representative of the Noteholders to haveregard to the interests of the Noteholders generally as regards all powers, authorities, duties and discretion ofthe Representative of the Noteholders but requiring the Representative of the Noteholders, in the event of aconflict between the interests of the holders of different Classes of Notes, to have regard only to the interestsof the holders of the Most Senior Class of Notes. Remedies pursued by the Representative of the Noteholdersin such circumstances may be adverse to the interest of the holders of the lower ranking Class of Notes (Seesection headed “Summary of the Transaction Documents – Intercreditor Agreement”).

Under Condition 11 (Events of Default – Issuer Insolvency Events), following an Event of Default theRepresentative of the Noteholders is not obliged to give the Issuer an Issuer Enforcement Notice declaringthe Notes to be due and payable, unless it is directed to do so by an Extraordinary Resolution of the holdersof the Most Senior Class of Notes or if so requested in writing by the holders of at least 75 per cent. of thePrincipal Amount Outstanding of the Most Senior Class of Notes and provided that it has been indemnifiedand/or secured to its satisfaction. In the case of each of the events described in paragraphs (a)(vii)(Unlawfulness) of Condition 11 (Events of Default – Issuer Insolvency Events), no Event of Default shalloccur unless the Representative of the Noteholders shall have certified to the Issuer that such event is, in itsopinion, materially prejudicial to the interests of the holders of the Most Senior Class of Notes and in thecase of each of the events described in paragraphs (ii) (Breach of other obligations) and (iii)(Misrepresentation) of Condition 11 (Events of Default – Issuer Insolvency Events), no Event of Defaultshall occur unless sanctioned by an Extraordinary Resolution of the Most Senior Class of Noteholders. Itshould be noted in this context that non-payment of any principal on its due date or any non-payment ofInterest Payment Amount on any Class B Note or Class C Note or Class D Note or Class E Notes on therelevant Payment Date shall only constitute an Event of Default where (i) (except where the Representativeof the Noteholders certifies that, in its opinion, such default is incapable of remedy, when no notice will berequired) the circumstances giving rise to such breach shall have continued unremedied for a period of 30days following the service by the Representative of the Noteholders on the Issuer of notice requiring thesame to be remedied and (ii) an Extraordinary Resolution is passed, in accordance with Condition 13(Meetings of Noteholders) of the holders of the Most Senior Class of Notes, declaring such event to be anEvent of Default.

The Intercreditor Agreement contains provisions requiring the Representative of the Noteholders to have theregard to the Issuer Secured Creditors as regards all powers, trusts, authorities, duties and discretions of theRepresentative of the Noteholders (except where expressly provided otherwise), but requiring theRepresentative of the Noteholders, in the event of a conflict between the interests of the holders of any Classof outstanding Notes and any Issuer Secured Creditor to have regard only (except where specificallyprovided otherwise) to the interests of the holders of such Class of Notes.

Noteholder directions and resolutions in respect of early redemption of the Notes

In a number of circumstances, the Notes shall become subject to early redemption. Early redemption of theNotes as a result of some circumstances may be dependent upon receipt by the Representative of theNoteholders of (i) a direction from, or resolution of, the Noteholders or, in the event of the exercise of thePut Option, (ii) the Put Option Exercise Notice from the Put Option Quorum. If the economic interest of aNoteholder and/or a Put Option Noteholder, as the case may be, represents a relatively small proportion ofthe majority and/or the Put Option Quorum, as the case may be, and its individual vote is contrary to themajority vote and/or the Put Option Quorum, as the case may be, its direction or vote may be disenfranchisedand, if a determination is made to redeem the Notes, any such minority Noteholder and/or a Put OptionNoteholder may face early redemption of the Notes held by it and/or may not receive all amounts due andpayable to it.

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Put Option exercised by the Put Option Noteholders and sale of the Portfolio

If the Put Option is exercised pursuant to Condition 7(e) (Redemption of the Notes at the option of the PutOption Noteholders) there can be no assurance that the Put Option Sale Procedure to be carried out by theIssuer as set out therein will be successful and the Issuer will obtain the Redemption Funds necessary toreimburse the Notes at their Redemption Value in accordance with the terms set out in such Condition.

Statutes of Limitation

Certain rights of the Issuer under the Transaction Documents may become barred under statutes of limitationby operation of law. In particular, although the parties to each of the Master Transfer Agreement haveexpressly agreed that claims for a breach of representation or warranty given by the Originator may bepursued against that Originator until the later of (i) the date on which the Notes have been repaid or cancelledin full; or (ii) the date on which all Receivables have been either written off or paid in full and no sums aredue and payable by the Originator to the Issuer under each of the Master Transfer Agreement, there is apossibility that the one year statute of limitation period set out in Article 1495 of the Italian Civil Code couldbe held to apply to some or all of the representations and warranties given by the Originator in the MasterTransfer Agreement, on the ground that such provisions may not be derogated from by the parties to a salecontract (“contratto di compravendita”) (such as the Master Transfer Agreement).

Changes to the Risk-Weighted Asset Framework

On 11 May 2004, the Basel Committee on Banking Supervision announced that it had reached consensus onthe remaining issues regarding the proposals for a new international capital adequacy framework whichplaces enhanced emphasis on market discipline and risk sensitivity.

The text of the new Basel II framework was published at the end of June 2004. The Committee has indicatedthat the standardised and foundation approaches would have been implemented from the end of 2006, butadvised that one further year of impact analysis would have been needed for the advanced approaches underthe framework and these, therefore, are expected to be implemented from the end of 2007.

In parallel with the development of the Basel II framework, the European Commission issued proposals forreform of the EU Capital Adequacy Directive which was based on the 1988 Capital Accord and applied tobanks and investment firms in the European Union. On the basis of such proposal, on 14 June 2006, theEuropean Commission implemented the new Basel II framework by means of the Directives 2006/48/EC and2006/49/EC and (together, the “New EU Capital Adequacy Directives”)

When implemented in the various EU Member States, the New EU Capital Adequacy Directives and, to theextent that it will be implemented in the jurisdictions outside the European Union, the new Basel IIframework could affect the risk-weighting of the Notes in respect of certain investors if those investors areregulated in a manner which will be affected by the new Basel II framework or the New EU CapitalAdequacy Directives. Consequently, Noteholders should consult their own advisors as to the effect onNoteholders of the application of the new Basel II framework, the New EU Capital Adequacy Directives andany implementing regulation in any relevant jurisdictions. The Issuer cannot predict the precise effects ofpotential changes which might result from the implementation of the new Basel II framework or theproposals.

Ring Fencing

Under the terms of Article 3 of the Securitisation Law, the assets relating to each individual securitisationtransaction (the “Securitised Assets”) will, by operation of law and to the extent not commingled with assetspertaining to any Further Securitisation, be segregated for all purposes from all other assets of the Issuer. Ona winding up of the Issuer, such Securitised Assets will only be available to holders of the notes issued tofinance the acquisition of the relevant Securitised Assets and to certain creditors claiming payments of debts

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incurred by the company in connection with the securitisation of the relevant Securitised Assets and they willnot be available to the holders of notes issued to finance any other securitisation transaction or to generalcreditors of the Issuer.

In relation to the Securitisation, the Portfolio and the Collections, when received by the Issuer, are segregatedunder the Securitisation Law from all other assets of the Issuer and will only be available to satisfy theobligations of the Issuer to the Noteholders, the Issuer Secured Creditors and Connected Third PartyCreditors in the order of priority set out in the Conditions, subject to the terms of the IntercreditorAgreement. Additionally the Issuer will grant additional security in relation to the Notes pursuant to theDeed of Charge and the Pledge Agreement.

The Issuer is unlikely to have a large number of creditors unrelated to this Securitisation because thecorporate object of the Issuer as contained in its by-laws (statuto) is limited and the Issuer will covenant inthe Conditions, inter alia, not to engage in any activity which is not incidental to or necessary in connectionwith any activities which the Transaction Documents provide for or envisage that the Issuer may engage inor which is necessary in connection with or incidental to the Transaction Documents. Nonetheless, thereremains the risk that the Issuer may incur unexpected expenses payable to Connected Third Party Creditors(which rank ahead of all other items in each of the Priority of Payments) which means that the fundsavailable to the Issuer for purposes of fulfilling its payment obligations under the Notes could be reduced.

The Conditions contain provisions stating, and each of the Issuer Secured Creditors has undertaken in theIntercreditor Agreement, that no Noteholder or Issuer Secured Creditor will petition or begin proceedings fora declaration of insolvency against the Issuer. However, there can be no assurance that each and everyNoteholder and Issuer Secured Creditor will honour its contractual obligation not to petition or beginproceedings for a declaration of insolvency against the Issuer.

If any bankruptcy proceedings were to be commenced against the Issuer, no creditors other than theRepresentative of the Noteholders on behalf of the Noteholders, the Issuer Secured Creditors and anyConnected Third Party Creditor would have the right to claim in respect of the Receivables; however, therecan in any event be no assurance that the Issuer would be able to meet all of its obligations under the Notes.

Accumulation of Principal

On each Payment Date during the Initial Period, amounts otherwise available to make payments of principalon the Notes (other than those to be applied for the purchase of Additional Pools (if any)) will be paid intothe Principal Reserve Account and further transferred to the Investment Account.

On the first Payment Date occurring after the expiry of the Initial Period, amounts credited to the PrincipalReserve Account as further transferred to the Investment Account, if not applied to cover Interest ShortfallAmounts in accordance with the Pre-Enforcement Principal Priority of Payment, will constitute PrincipalAvailable Funds available for distribution in accordance with the Principal Priority of Payments.

If an Issuer Insolvency Event occurs or an Issuer Enforcement Notice is served by the Representative of theNoteholders on the Issuer during the Initial Period, amounts credited to the Investment Account as PrincipalAvailable Funds will be applied together with all the other amounts received or recovered in respect of theSecuritisation Assets to make payments in accordance with the Enforcement Priority of Payments. In suchevent the Issuer would become subject to tax in respect of accrued interest and premium (if any) paid on theamount so redeemed as described above and the Italian tax authority would become a Connected Third PartyCreditor having a preferential claim in respect of such tax charge.

Withholding Tax in respect of the Notes

According to the provisions of Article 6 of Law 239, as amended and supplemented from time to time anyNoteholder who (a) is not a person resident for tax purposes (or an institutional investor incorporated) in a

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country that recognises the Italian tax authorities’ right to a satisfactory exchange of information (as per thelist provided in Ministerial Decree of 4 September 1996) (the “Qualifying Countries”), or (b) isresident/incorporated in such a country but has not fulfilled all the requisite documentary requirements underLegislative Decree 1 April 1996, No. 239 will receive amounts of interest payable on the Notes, net of Italianwithholding tax (See section headed “Taxation”). At the date of this Prospectus such withholding tax islevied at the rate of 12.5 per cent. or at such lower rate as may be applicable under the relevant doubletaxation treaty entered into by Italy, if more favourable (the application of lower treaty rate is subject totimely filing of required documentation).

The Italian Government on 18 April 2005 enacted the EU Directive (Council Directive 2003/48/EC,published in the Official Journal of the European Union dated 26 June 2003) regarding the taxation ofsavings income. Under the Directive, Member States will generally be required to provide the tax authoritiesof another Member State with details of payments of interest or other similar income paid by a person withinits jurisdiction to an individual resident in that other Member State. Exceptionally, unless they electotherwise (and for a transitional period only, which will end after an agreement on the exchange ofinformation is reached between the European Union and certain non-European Union states), each ofBelgium, Luxembourg and Austria will instead be required to collect a specific tax from such paymentsunless the Noteholder within its jurisdiction authorises the person making the payment to report the paymentor presents a certificate from the relevant tax authority establishing exemption therefrom. The Directiveapplies to interest payments made starting from 1 July 2005.

In the event that the Notes are redeemed in whole or in part prior to eighteen months from the Issue Date, theIssuer will be required to pay an additional amount equal to 20 per cent. of interest and premium (if any)accrued up to the time of the early redemption, pursuant to Article 26 (1) of the Presidential Decree No. 600of 29 September 1973.

Except where the Notes are declared due and payable following the service of an Issuer Enforcement Noticeon the Issuer, upon the occurrence of an Issuer Insolvency Event or where the Notes are redeemed for a Taxor Regulatory Event in accordance with Condition 7(c) (Redemption, Purchase and Cancellation –Redemption for Tax or Regulatory Event), no redemption of the Notes may occur under the Conditions untilafter the expiry of the Initial Period. Condition 7 (Redemption, Purchase and Cancellation) provides that, inthe event that any amounts would, save for the provisions of Condition 7 (Redemption, Purchase andCancellation), be payable to Noteholders as a mandatory redemption of principal during the Initial Period,such amounts will be retained by the Issuer until the First Amortisation Payment Date, when they will beapplied in accordance with the applicable Priority of Payments.

RISKS ASSOCIATED WITH THE PORTFOLIO

Risk of avoidance of prepayments upon the insolvency of the Borrower

Pursuant to Article 65 of the Italian Bankruptcy Act, payments of receivables made in the two yearspreceding the payer’s declaration of insolvency are ineffective as against the payer’s creditors (including areceiver in the payer’s insolvency) if the receivables fall due on or after the payer’s declaration ofinsolvency. A recent supreme court decision (Corte di Cassazione decision no. 4842 of 5 April 2002),overruling the view taken by previous decisions, has held that prepayments of loans generally fall within thescope of application of Article 65 of the Italian Bankruptcy Act, irrespective of the borrower being entitled toprepay the loan by statute or pursuant to an express provision of the relevant loan agreement. Whilst as aresult of the provisions of Article 4 of the Securitisation Law, no claw-back under Article 67 of the ItalianBankruptcy Act would apply to payments made by the assigned borrowers to companies organised under theSecuritisation Law (such as the Issuer), the application of Article 65 of the Italian Bankruptcy Act to suchpayments is not excluded by any provision of the Securitisation Law. Therefore it cannot be excluded that,prepayments of the underlying Receivables made to the Issuer by Borrowers who may be subject toinsolvency proceedings (i.e. corporate entities and private individuals carrying out certain business activities)may be subject to claw-back under Article 65 of the Insolvency Act, with the consequence that the Issuer

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would be required to pay to the receiver of each such Borrower, in priority to any payment due by the Issuerunder the Notes, any amount prepaid by such Borrower in the two years preceding the date such Borrowerwas declared insolvent. This risk is mitigated, to some extent, by the fact that (i) under the Italian BankruptcyAct individuals, who are entrepreneurs not meeting the requirements set out in the Italian Bankruptcy Act orare not owners of interests in an unlimited partnership, are not subject to insolvency proceedings; and, in thisrespect, (ii) the Originator has represented that at the date each relevant Loan Agreement was entered intoand at the date of the relevant Master Transfer Agreement, (A) none of the Borrowers fell in any category ofindividuals who are subject to insolvency proceedings under the Italian law, save for those Borrowers towhom a mortgage loan qualifying as mutuo fondiario pursuant to Article 38 (and following) of the ItalianBanking Act was granted, and in respect of which the 10 day period for consolidation of the relevantmortgage has elapsed and (B) all Loans granted by DB Mutui to Borrowers in order to purchase a RealEstate Asset from a vendor who was capable of becoming subject to Insolvency Proceedings underapplicable law qualify as mutuo fondiario pursuant to Article 38 (and following) of the Italian Banking Act,and the relevant 10 day period for consolidation of the relevant mortgage has elapsed, and, furthermore, (iii)the Criteria disallow the assignment to the Issuer of Loan Receivables arising under Loan Agreements by theOriginator that are in default, are delinquent or which have been in default or delinquent. It should also benoted that, by applying some principles adopted by certain lower court decisions and arguments posited bycertain scholars, the principle set out in the above decision of the Corte di Cassazione might not apply to theearly repayment of loans secured by a mortgage. Moreover, it is not certain that the ratio decidendi ofdecision 4842 of the Corte di Cassazione (which deals with the prepayment of an unsecured bond) would beapplied to mortgage loans such as those included in the Portfolio.

Performance of Loan Agreements

The Portfolio is comprised of residential and, to a very limited extent, commercial mortgage loans whichwere performing as at the Cut-Off Date (See section headed “The Portfolio”). There can be no guarantee thatthe Borrowers will continue to perform their respective obligations under the Loan Agreements. Therecovery of amounts due in relation to non-performing Loan Agreements is dependent on the effectivenessand duration of enforcement proceedings in the Republic of Italy. Mortgage enforcement proceedings in Italycan take considerable time depending on the nature of the action, where such action takes place and otherfactors, including: (i) that proceedings in certain courts in which action must be taken for the enforcement ofthe Loan Agreements and Mortgages may take longer than the national average; (ii) that obtaining title deedsfrom land registries (which are in the process of computerising their records) can take up to two or threeyears; and (iii) that it takes a number of years from the time of commencement of enforcement proceedingsuntil the time that an auction date is set for the forced sale of mortgaged assets.

Pursuant to Italian law No. 302 of 3 August 1998 and Italian law No. 80 of 14 May 2005, notaries, lawyersand accountants are allowed to conduct certain stages of the foreclosure procedures in place of the courts;such provisions are expected to reduce the length of foreclosure proceedings, although at the date of thisProspectus the impact which such laws will have on the Receivables comprised in the Portfolio cannot beassessed.

In addition, the ability of Borrowers to repay Loans may be affected by adverse changes in macro-economicconditions affecting the Republic of Italy.

Risks of losses associated with declining property values

The security for the Notes consists of, inter alia, the Issuer’s interest in the Mortgages. The value of thissecurity may be affected by, among other things, a decline in property values. No assurance can be given thatthe values of the real estate assets subject to the Mortgages have remained or will remain at the level atwhich they were on the dates of origination of the related Loan Agreements. Should the residential and non-residential property market in Italy experience an overall or a regional decline in property values, such adecline could, in certain circumstances, result in the value of the security being significantly reduced andultimately, may result in losses to the Noteholders if the Mortgages are required to be enforced.

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Termination of Loan Agreements

The Portfolio comprises Loan Agreements which qualify as mutui fondiari.

Pursuant to Article 40, paragraph 2 of the Italian Banking Act, a mortgage lender is entitled to terminate aloan agreement qualifying as mutuo fondiario and accelerate the mortgage loan solely if the relevantborrower has delayed payment of a loan instalment at least seven times, whether consecutively or otherwise.For this purpose, a payment is considered delayed if it is made between 30 and 180 days after the due datefor payment.

Article 40 of the Italian Banking Act therefore prevents the Servicer from commencing proceedings torecover amounts in relation to any Loan Agreement until the relevant Borrower has defaulted to timely payat least seven loan instalments, albeit non consecutive.

Value of the Mortgages

Pursuant to Article 39, paragraph 5, of the Italian Banking Act, upon repayment of each fifth of the originaldebt, the borrowers under loan agreements qualifying as mutui fondiari are entitled to a proportionalreduction of any mortgage related to the loan.

Accordingly, the underlying value of the Mortgages comprised in the Portfolio may decrease from time totime in connection with the partial repayment of the Loan Agreements, it being understood that, incompliance with the provisions set forth in Article 38, paragraph 2, of the Italian Banking Act and the Bankof Italy Instructions on loans qualifying as mutui fondiari, the principal amount of each Loan outstandingfrom time to time shall never exceed 80 per cent. of the value of the real estate assets constituting security forsuch Loan, unless additional guarantees are given in respect of the relevant Loan Agreement.

Servicing of the Portfolio

Under the Servicing Agreement, DB Mutui has been appointed as the Servicer of the Portfolio by the Issuerin relation to the administration, servicing, management, collection and recovery procedures in relation to theReceivables transferred by the Originator to the Issuer pursuant to each of the Master Transfer Agreement.

In order to alleviate the risks associated with the servicing activities and to ensure that the Receivables aremanaged and serviced in a uniform and coherent fashion:

(a) the Servicer will utilise personnel to carry out its activities under the Servicing Agreement withappropriate experience in relation to such activities (however, such personnel will also continue toperform debt collection services for the Servicer and therefore will not be exclusively dedicated tothe performance of the Servicer’s activities under the Servicing Agreement); and

(b) the Servicer has agreed, under the Servicing Agreement, to take overall responsibility for theadministration, servicing, management, collection and the taking of recovery procedures in relationto the Portfolio.

Historical Information

The financial and other information set out in the sections entitled “The Portfolio” and “The Originator”,including without limitation information in respect of collection rates, represents the historical experience ofthe Originator. There can be no assurance that the future experience and performance of DB Mutui asOriginator (and as Servicer) of the Portfolio will be similar to the experience shown in this Prospectus.

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ITALIAN LEGAL CONSIDERATIONS

Mutui fondiari enforcement proceedings

Some of the Loans comprised in the Portfolio are mutui fondiari. Enforcement proceedings in respect ofmutui fondiari commenced after 1 January 1994 are currently regulated by Article 38 (and following) of theItalian Banking Act in which several exceptions to the rules applying to enforcement proceedings in generalare provided for. In particular, there is no requirement to serve a copy of the loan agreement directly on theborrower and the mortgage lender of mutui fondiari is entitled to commence or continue enforcementproceedings after the borrower is declared insolvent or insolvency proceedings have been commenced.

Moreover, the custodian appointed to manage the mortgaged property in the interest of the fondiario lenderpays directly to the lender the revenues recovered on the mortgaged property (net of administration expensesand taxes). After the sale of the mortgaged property, the court orders the purchaser (or the assignee in thecase of an assignment) to pay that part of the price corresponding to the mutuo fondiario lender’s debtdirectly to the lender.

Pursuant to Article 58 of the Italian Banking Act, as amended by Article 12 of Legislative Decree number342 of 4 August 1999, the Issuer will be entitled to benefit from such procedural advantages which apply infavour of a lender of a mutuo fondiario loan.

Enforcement proceedings for mutui fondiari commenced on or before 31 December 1993 are regulated byRoyal Decree number 646 of 16 July 1905 which confers on the mutuo fondiario lender rights and privilegeswhich are not conferred by the Italian Banking Act with respect to enforcement proceedings on mutuifondiari commenced on or after 1 January 1994. Such additional rights and privileges include the right of thebank to commence enforcement proceedings against the borrower even after the real estate has been sold to athird party who has replaced the borrower as borrower under the mutuo fondiario, provided that the name ofsuch third party has not been notified to the lender. Further rights include the right of the bank to apply forthe real estate to be valued by the court after commencement of enforcement proceedings, at the valueindicated in the mutuo fondiario agreement without having to have a further expert valuation.

Italian Usury Law

Italian law No. 108 of 7 March 1996 (the “Usury Law”) introduced legislation preventing lenders fromapplying interest rates higher than those deemed to be usurious (“Usury Rates”). Usury Rates are set on aquarterly basis by a decree issued by the Italian Treasury. Recent case law (and in particular Italian SupremeCourt judgments 1126 of 2 February 2000, 5286 of 22 April 2000 and 14899 of 17 November 2000) has heldthat the Usury Law applies to loan agreements executed prior to the Usury Law coming into force withregard to interest payments made following such date. Based on such judgments, Italian borrowers of loansbearing interest at a rate which is at any time above the prevailing Usury Rate or any interested person,including the judge deciding the case, may claim or declare, as the case may be, that the clause providing forthe payment of interest is null and void or that a corresponding reduction in the contractual rate payableunder the relevant loan should be made and the amounts paid in excess be returned. With a view to limitingthe impact of the application of the Usury Law to Italian loans executed prior to its entering into force, on 29December 2000 the Italian Government issued a law decree (decreto legge) (“Decree 394/2000”) convertedinto law by the Italian Parliament with Law No. 24 of 28 February 2001 (“Law 24/2001”), interpreting theprovisions of the Usury Law. Pursuant to Law 24/2001, an interest rate is usurious if it is higher than thelegal limit in force at the time at which it is promised or agreed, in any form, regardless of the time at whichpayment is made.

Law 24/2001 further provides that, due to the exceptional fall in interest rates in the years 1998 and 1999,rates of interest set in relation to fixed interest loans (granted in the form of mutui as defined pursuant toarticle 2, paragraph 2, of the Usury Law) other than subsidised loans (finanziamenti non agevolati) in force atthe date of Decree 394/2000 and in respect of instalments payable after 2 January 2001, shall, as an

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extraordinary measure, except where the parties have agreed more favourable contractual terms, be replacedwith the rates specified in Law 24/2001 being a rate of 9.96 per cent. per annum for all loans except forcertain mortgages financing the purchase of certain residential property for an amount not in excess ofEuro 77,468 (which are subject to a rate of 8 per cent. per annum). Furthermore, pursuant to Law 24/2001,Italian borrowers may not claim exceptions to, or assert claims based on, the Usury Law in respect of interestpayable on the relevant loans up to 2 January 2001, unless at the time of execution of the relevant loanagreement or at the time at which the rate of interest in respect thereof was agreed (if different), the interestrate exceeded the then applicable Usury Rate.

Law 24/2001 has however been challenged before the Italian Constitutional Court on the grounds that itwould not comply with the provisions of the Constitution.

In February 2002, the Constitutional Court confirmed that under Decree 394/2000, the reference point inconsidering whether a rate is usurious or not is the date of execution of the relevant loan agreement and thatthe replacement of usurious rates with rates fixed by the Decree 394/2000 should operate as from 31December 2000 and not 2 January 2001 as stated in the decree.

Please note that a few lower court decisions have, on the basis of certain legal arguments, held that,irrespective of the principle set out in Law 24/2001, if interest originally agreed at a rate falling below thethen applicable usury limit (and thus, not usurious) were, at a later date, to exceed the usury limit from timeto time in force, such interest should nonetheless be reduced to the then applicable usury limit. Please notethat, the foregoing decisions, to date, have not been upheld by an Italian Supreme Court ruling which, on thecontrary, in the recent decision 21265 of 26 June 2007 has again clearly stated what already provided by Law24/2001 that an interest rate is usurious if it is higher than the legal limit in force at the time at which it ispromised or agreed, in any form, regardless of the time at which payment is made.

The Originator has represented in the relevant Master Transfer Agreement that the Receivables in thePortfolio comply with applicable Italian laws relating to usury.

Compounding of Interest (Anatocismo)

According to Article 1283 of the Italian Civil Code governing the capitalisation of interest in respect ofmonetary claims, accrued interest may be capitalised only (i) from the date on which a legal proceeding iscommenced in respect of any such monetary claim, or (ii) by virtue of an agreement entered into by theparties after the date on which such claim became due, provided in both cases that such interest has accruedfor at least six months. Article 1283 of the Italian Civil Code allows derogation from this provision in theevent that there are recognised customary practices (usi normativi) to the contrary. Banks and financialinstitutions in the Republic of Italy have traditionally capitalised accrued interest on a three monthly basis onthe grounds that such practice could be characterised as a customary practice (uso normativo). However, anumber of recent judgments from Italian courts (including judgments from the Italian Supreme Courts No.13739/2003, No. 12222/2003, No. 2593/2003, No. 3096/1999 and No. 2374/99 from the Supreme Court)have held that such practices are not customary practices (uso normativo). In this respect, it should be notedthat pursuant to Article 120 of the Consolidated Banking Act, as amended by Article 25 of LegislativeDecree no. 342 of 4 August 1999 (“Law No. 342”) enacted by the Italian Government under a delegationgranted pursuant to law No. 142 of 19 February 1992 (“Legge Delega”), and pursuant to the resolution of theInterministerial Committee of Credit and Savings (CICR) of 9 February 2000 (the “Resolution”), banks cancapitalise accrued interest due from clients provided that they capitalise with the same frequency interestowed to clients. In particular, in compliance with the provisions set forth in the Resolution, from the date onwhich the Resolution entered into force (i.e. 22 April 2000) the capitalisation of accrued interest will still bepossible upon the terms established by the Resolution which further provided that all conditions applied inrelation to contracts executed prior to its coming into force were to be adjusted so to comply with such newregulation by 30 June 2000 with effect from 1 July 2000. Law No. 342 has been challenged, however, beforethe Italian Constitutional Court on the grounds that it falls outside the scope of the legislative powersdelegated under the Legge Delega. On 17 October 2000, the Italian Constitutional Court (judgment

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No. 425/2000) upheld the challenge of Article 25 of Law 342 on the grounds of eccesso di delega, declaringsuch article as unconstitutional, thus null and void on the basis of conflict with Italian constitutionalprinciples. In addition, the Italian Supreme Court has recently stated (by way of decision No. 21095 of 4November 2004, thereafter confirmed by a decision: No. 10376 of 2006 of 5 May 2006) that the practice bythe banks to capitalise accrued interest on a quarterly basis is invalid also in relation to agreements executedbefore the judgment No. 2374/99 by the Italian Supreme Court and not only for those agreements executedafter such judgment.

As a consequence thereof, the challenge by any Borrower of the practice of capitalising interest and theupholding of such interpretation of the Italian Civil Code in judgments of the other courts of the Republic ofItaly could have a negative effect on the returns generated from the Loan Agreements.

The Originator has undertaken in the relevant Master Transfer Agreement to which it is a party to indemnifythe Issuer fully in respect of any losses, costs and expenses that may be incurred by the Issuer in connectionwith any loss or reduction in any interest accrued on the Receivables in the Portfolio as a result of theapplication of Italian law provisions concerning the capitalisation of accrued interest.

Application of Securitisation Law

The Securitisation Law was enacted on 30 April 1999 and was conceived to simplify the process andfacilitate the increased use of securitisation as a financing technique in the Republic of Italy.

It applies to securitisation transactions involving the “true” sale (by way of non-gratuitous assignment) ofreceivables where the sale is to a company created in accordance with Article 3 of the Securitisation Law andall amounts paid by the assigned borrowers are to be used by the relevant company exclusively to meet itsobligations under notes issued to fund the purchase of such receivables and other costs and expensesassociated with the securitisation transaction.

The Securitisation Law requires that the Portfolio must be assigned to the Issuer in accordance with theprovisions of paragraphs 2, 3 and 4 of Article 58 of the Italian Banking Act.

The prevailing interpretation of these provisions is that:

(a) the assignment should be perfected against the assigned borrowers and third party creditors by way(i) of publication of a notice of transfer in the Italian Official Gazette, and (ii) registration of suchnotice with the companies’ register of the district where the issuer has established its registeredoffice, so avoiding the need for notification to be served on each assigned borrower;

(b) as from the later of the date of publication of the notice in the Italian Official Gazette and the date ofthe registration of the notice with the companies registrar of the district where the Issuer has itsregistered office, the assignment becomes enforceable against:

(i) the assigned private borrowers and any creditors of the originator who have not prior to thedate of publication and deposit of the notice commenced enforcement proceedings in respectof the relevant receivables;

(ii) the liquidator or other bankruptcy official of the assigned borrowers (so that any paymentsmade by an assigned borrower to the purchasing company may not be subject to any clawback action according to Article 67 of the Italian Bankruptcy Act); and

(iii) any other permitted assignees of the Originator who have not perfected their assignmentprior to the later of the date of publication of the notice in the Italian Official Gazette and thedate of registration of the notice with the companies registrar of the district where the Issuerhas its registered office;

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(c) the benefit of any privilege, guarantee or security interest guaranteeing or securing repayment of thereceivables will automatically be transferred to and perfected with the same priority in favour of theIssuer, without the need for any formality or annotations with the relevant land registry in Italy;

(d) as from the later of the date of publication of the assignment in the Italian Official Gazette and theregistration with the companies registrar of the district where the issuer has its registered office, nolegal action may be brought to attach the receivables assigned, or the sums derived therefrom, otherthan for the purposes of enforcing the rights of the noteholders issued for the purpose of financingthe acquisition of the relevant receivables and to meet the costs of the transaction; and

(e) assignments executed under the Securitisation Law are subject to revocation or bankruptcy underArticle 67 of the Italian Bankruptcy Act but only in the event that the securitisation transaction isentered into within three months of the adjudication of bankruptcy of the relevant party or, in caseswhere paragraph 1 of Article 67 applies, within six months of the adjudication of bankruptcy. (Undereach of the Master Transfer Agreement, the Originator represents and warrants, in summary, that itis not subject to Insolvency Proceedings nor are there any circumstances which might cause it tobecome insolvent).

Under Article 3 of the Securitisation Law, by operation of law, the Issuer’s right, title and interest in and tothe Portfolio will be segregated from all other assets of the Issuer and the Portfolio and the relevantCollections, once received by the Issuer, will be available on a winding up of the Issuer only to satisfy theobligations of the Issuer to the holders of the Notes, each of the Other Issuer Secured Creditors and anyConnected Third Party Creditor. Amounts derived from the Portfolio will not be available to any othercreditors of the Issuer. Under the Intercreditor Agreement, the Issuer Secured Creditors party thereto willagree not to commence insolvency or winding up proceedings against the Issuer except in certain limitedcircumstances and, in addition, the obligations of the Issuer under the Notes are limited recourse. However,under Italian law, any creditor of the Issuer would be able to commence insolvency or winding upproceedings against the Issuer in respect of any unpaid debt.

As at the date of this Prospectus, the application of the Securitisation Law has not been considered by anItalian Court and only a number of interpretations of its application have been issued by Italian governmentalor regulatory authorities. Consequently, it is possible that such authorities may issue further regulationsrelating to the Securitisation Law or the interpretation thereof, the impact of which cannot be predicted bythe Issuer as at the date of this Prospectus.

Rights of set-off of Borrowers

Under general principles of Italian law, the Borrowers are entitled to exercise rights of set-off in respect ofamounts due under any Loan Agreement to the Issuer against any amounts payable by the Originator to therelevant Borrower and which came into existence (were crediti esistenti) prior to the later of the publicationof the notice of assignment of the Receivables in the Italian Official Gazette and the date of the registrationof the notice with the companies’ register of the district where the issuer has its registered office.

Under the terms of each of the Master Transfer Agreement, the Originator has agreed to indemnify the Issuerin respect of any reduction in amounts received by the Issuer in respect of the Portfolio as a result of theexercise by any Borrower of a right of set-off.

Preferred Claims

According to rulings of the Tribunal of Genoa on 25 January 2001 and the Tribunal of Reggio Emilia on 22November 2002 and the Supreme Court decision No. 17197 of 14 November 2003, issued with reference toItalian Law decree No. 669 of 31 December 1996 and converted into law No. 30 of 28 February 1997, claimsof any persons who have concluded preliminary agreements (contratti preliminari) with a mortgagor for thepurchase of real estate which were registered in real estate registries (Conservatorie dei Registri Immobiliari)

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prior to the registration of mortgages or even after such registration, would be preferred to the claims of thecreditors of the relevant mortgage. This risk is mitigated to some extent by the fact that (i) the notary publicbefore which a Loan Agreement is executed as a public deed (atto pubblico) or by way of private deed withauthenticated signatures (scrittura privata autenticata) prior to the execution thereof, carries out a controlprocedure in order to verify the ownership of the real estate and to confirm that the relevant real estate is freeof any security interest (including any similar registration) and (ii) the Originator has represented in theMaster Transfer Agreement that, with respect to the Initial Pool as at the Execution Date, there were nooutstanding registrations, transcriptions or annotations (iscrizioni, trascrizioni o annotazioni) which might beprejudicial to the legality, validity or enforceability of any Mortgage or which might render any Mortgagenot an economically first ranking priority mortgage (ipoteca di primo grado economico). Pursuant to theMaster Transfer Agreement, the Originator will give the same representation in respect of each AdditionalPool as at the relevant Transfer Date.

Decree 31 January 2007 No. 7 (Decree No. 7)

Decree No. 7 was issued on 31 January 2007 and was converted into law (law No. 40) by the ItalianParliament on 2 April 2007.

Pursuant to Article 7 of Decree No. 7, loans granted to private individuals (such as the Borrowers) topurchase or refurbish a real estate asset, whether residential or for the purposes of carrying out a businessactivity, cannot provide for penalty clauses in the event of early or partial repayment made by borrower. Anyclause breaching or contravening such provision is null and void by operation of law.

This means that pursuant to those loan agreements which have been granted to private individuals topurchase or refurbish a real estate asset, whether residential or for the purposes of carrying out a businessactivity which will be entered into in the next future, each relevant borrower will always be entitled to earlyrepay the loan without incurring additional costs.

Outstanding loans would also be affected. Pursuant to Article 7 of Decree No. 7, in a 3 month period fromthe date of coming into force of Decree No. 7, ABI (Associazione Bancaria Italiana) and national customers’associations shall agree on general principles for the renegotiation of the penalties clauses under outstandingloans and, in particular, fix the maximum amount of such penalties. In accordance with such provision, on 2May 2007, ABI (Associazione Bancaria Italiana) and the national customers’ associations agreed on themaximum amount of such penalties which are dependent on, inter alia, the date on which the relevant loanagreement were entered into and on whether the applicable interest rate is fixed, floating, or a combination ofthem.

In addition, lenders may not refuse the renegotiation of the loan agreements entered into prior to the enteringinto force of Decree No. 7 if the borrower proposes to reduce such penalties to an amount not higher than themaximum amount determined as described above. In this respect, on 21 November 2007, ABI (AssociazioneBancaria Italiana) and the national customers’ associations agreed on the specific procedures (the ABIProcedures) which shall be followed in the event the relevant borrower wish to renegotiate the loanagreement, specifying that (i) a single document, comprehensive of all the amendments, will have to besigned by both the borrower and the lender; and (ii) the notary will not be necessary in order to give validityto the amendment document. In addition, please note that the timing of the procedure has been considerablyspeed up as the renegotiation of the loan agreement shall be completed within 10 business days from theborrower’s request.

In addition, Article 8 of the Decree No. 7 states that, in case of a loan, overdraft facility or any otherfinancing granted by a bank, the relevant borrower can exercise the right of subrogation set forth in Article1202 of Italian Civil Code (the “Subrogation”), even if the borrower’s debt towards the lending bank is notdue and payable or a term for repayment has been agreed for the benefit of the creditor. If the Subrogation isexercised by the borrower, a new lender will succeed to the former lender also as beneficiary of all existingancillary security interests and guarantees. Any provision of the relevant agreement which may prevent the

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borrower from exercising such Subrogation or render the exercise of such right more cumbersome for theborrower is void. The subrogation shall not lead to the application of further taxes on the borrowers side inaddition to the “imposta sostitutiva” originally paid by the borrower. In this respect, the ABI Procedureshave also set out the specific procedures which shall be followed in the event the relevant borrower wish toexercise its right of Subrogation, specifying that (i) a single document will include (A) the new loanagreement to be entered into between the borrower and the new lender, (B) the payment receipt issued by theoriginal lender, (C) the consent to the Subrogation and (D) with respect to the mortgage securing, therelevant loan, the relevant annotation (annotazione) in the land register; and (ii) the notary will be necessaryin order to give validity to the Subrogation as the relevant document will have to be executed by way of apublic deed (atto pubblico) or by way of a private deed bearing an indisputable date (scrittura privataautenticata). In addition, please note that the timing of the procedure has been considerably speed up as theSubrogation shall be completed within 15 business days from the borrower’s request.

As a consequence of the above, prepayment fees under the terms of the Loan Agreements could besignificantly reduced. This may have an impact on (i) the rate of prepayment of the Loan Agreements (theBorrower would no longer have “disincentives” should a “more attractive” loan be found on the market) and(ii) the funds available to the Issuer.

ITALIAN TAXATION CONSIDERATIONS

Tax position of the Issuer

The Issuer is a società a responsabilità limitata registered with the Ufficio Italiano dei Cambi and the Bankof Italy as a non-banking financial intermediary and, as such, is currently liable to (i) Italian corporation tax(“IRES”) at a rate of 33 per cent. and (ii) Italian regional tax (“IRAP”) at a rate of 4.25 per cent. (localsurcharge may apply up to 1 per cent.). Pursuant to the regulations issued by the Bank of Italy on 29 March2000 (schemi di bilancio delle società per la cartolarizzazione dei crediti) and on February 14, 2006(istruzioni per la redazione dei bilanci degli intermediari iscritti nell’”elenco speciale” degli IMEL, delleSGR e delle SIM) as to accounting treatment of companies incorporated pursuant to the Securitisation Law,all assets, liabilities, income and expenses attributable directly to the securitisation of the Receivables will betreated as off-balance sheet assets, liabilities, income and expenses. Circular No. 8/E of 6 February 2003,issued by the Italian Agency of Revenues (Agenzia delle Entrate), has stated that the tax regime applicable tothe Issuer as long as the Notes are outstanding is consistent with the above applicable accounting regime.According to Circular No. 8/E of 6 February 2003, an issuer will be taxed on the proceeds generated by asecuritisation transaction under the ordinary Italian tax rules if and to the extent that such proceeds arelegally available to such issuer when all obligations of the issuer to the noteholders and to the other creditorsin respect of the relevant securitisation transaction have been fully discharged.

As a consequence of the position taken by the Italian tax authorities in Circular No. 8/E of 6 February 2003,no taxable income will be realised by the Issuer whilst any Notes are outstanding (except only for non-expensed amounts retained by the Issuer).

Withholding Tax on the Issuer Italian Accounts

Interest accrued on the Issuer Italian Accounts held with the Italian Account Bank or another bank resident inItaly for tax purposes or with the Italian branch of a non-Italian resident bank will be subject to withholdingtax on account of Italian corporate income tax which, as at the date of this Prospectus, is levied at the rate of27 per cent. However, pursuant to Resolution No. 222/E, of 5 December 2003 (“Resolution No. 222/E”),issued by Ministry of Economy and Finance, the Issuer may not be able to effectively utilise this withholdingtax against its Italian corporate income tax liability, until the obligation of the Issuer to the Noteholders, tothe Other Issuer Creditors and to any third party to whom the Issuer has incurred costs, liabilities, fees andexpenses in relation to the transaction are satisfied (fino a che non siano stati soddisfatti tutti i creditori delpatrimonio separato dell’Issuer). As a consequence of Resolution No. 222/E, if and to the extent that no

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taxable income will accrue to the Issuer at the end of the securitisation, the Issuer will not be entitled torecover the 27 per cent. withholding tax already paid on interest accrued on the accounts.

Registration tax on transfer of Italian Receivables

Registration and/or other forms of documentary taxes are applied upon execution in Italy of agreements andcertain other deeds, depending on the manner in which they are documented, the place of execution andwhether or not such documents or deeds are required to be registered with a public registry in Italy.

These taxes include, in the case of an assignment of a receivable or claim under the contract, registration taxin an amount equal to 0.50% of the amount of the relevant receivable or monetary claim being assigned (the“proportional registration tax”), unless VAT is applicable to a transaction in which event – in line with theprinciple pursuant to which VAT is applied as an alternative to proportional registration tax (the so-calledprincipio di alternatività) – only registration tax in a fixed amount of Euro 168 will apply.

Registration Tax on judgments

If the Issuer were to obtain a judgment from an Italian court (this includes a decree executing an arbitralaward) in respect of a breach of any Italian Transaction Document or were to enforce a judgment in Italy inrespect of any such breach in the event that such judgement has been given in a State which is not a memberof the European Union, a registration tax of up to three per cent. of the amount awarded pursuant to any suchjudgment may be payable. However, in normal circumstances such registration tax would be chargeable tothe losing party as damages. No registration tax or other duty will be due in Italy, other than a registration taxat the flat rate of Euro 168, in the proceedings of the declaration of enforceability of a judgment in respect ofany such breach given in a member state of the European Union.

As of and from 1 March, 2002, no stamp duty and other administrative charges apply on documents anddecrees related to civil, criminal and administrative proceedings, as such charges has been replaced by asingle tax (the so-called contributo unificato di iscrizione a ruolo). Such tax – which does not replaceregistration tax – would apply at a rate varying from Euro 30 to Euro 1,110.

Registration tax in “caso d’uso” and “enunciazione”

In addition, each Transaction Document may be subject to registration tax at a fixed amount of Euro 168 orat a rate of up to three per cent. of the amount indicated in each Transaction Document where a caso d’uso oran enunciazione will occur.

Caso d’uso means the filing of a Transaction Document with an Italian court which is called to decide onnon-contentious matters (un atto si deposita per essere acquisito agli atti presso le cancellerie giudiziarienell’esplicazione di attività amministrative), or with an Italian administrative authority or public body wherethe filing is aimed at obtaining the granting of a right from such administrative authority or public body,unless such filing is compulsory as a matter of law. The filing of a Transaction Document with any Italiancourt for the purposes of judicial proceedings (i.e. contentious matters) does not give rise to a caso d’uso.

Cross-references to the Transaction Documents in a deed, agreement or other document which has been filedwith the Italian registration tax office will give rise to a case of enunciazione for the Transaction Documentsif the relevant document filed for registration has been entered by the same parties which entered theTransaction Documents. In such a case, the Italian tax authorities may ask for the cross-referencedTransaction Documents to be filed with the competent Italian registration tax office and, consequently, theapplication of registration tax to such Transaction Documents according to the ordinary rules. The ruleapplies at Italian tax authorities’ request and only to the extent that the document filed with the registrationtax office and the Transaction Document which has been mentioned therein are entered into by the sameparties. Where one of the parties of one of the Transaction Documents is not also a party of the document

ITA80503 54

filed for registration with the Italian registration tax office, no enunciazione will apply in respect of thespecific Transaction Document.

The same rule also applies in case of cross-references into a judicial decision of a Transaction Documentwhich has not been subject to registration tax in Italy.

In cases where the Transaction Documents filed with the registration tax office as a consequence of a casod’uso or enunciazione are subject to VAT, registration tax would be levied at the fixed rate of Euro 168.

OTHER LEGAL CONSIDERATIONS

Fixed and floating security – Deed of Charge – Pledge on the Accounts

Security given under the English law governed Deed of Charge, even if expressed as a first fixed securityinterest, may take effect as a floating charge and thus, on enforcement, certain preferential creditors mayrank ahead of the Issuer Secured Creditors.

One of the characteristics of a floating charge is the ability of the chargor to carry on business in relation tothe relevant assets, until some future step is taken by or on behalf of the chargee. Where a chargor is free todeal with the assets subject to the charge without the consent of the chargee, an English court may hold thatthe charge constitutes a floating charge, notwithstanding that it may be described as a fixed charge.

There is a risk that the Security Interests created by the Deed of Charge may be held to take effect as floatingcharges. In that case, the claims of the Issuer Secured Creditors would, on a winding-up of the Issuer underEnglish law, be subject to the claims which are given priority over a floating charge by law, including priorcharges, the expenses of any winding-up and the claims of preferential creditors. However, having regard tothe fact that the Issuer is an Italian company (having their registered offices in the Republic of Italy), it islikely that a winding-up of the Issuer would take place under the laws of the Republic of Italy and thereforequestions regarding the priority of creditors’ claims against the Issuer’s bankruptcy estate would bedetermined in accordance with principles of Italian law.

Change of Law

The structure of the transaction and, inter alia, the issue of the Notes and ratings assigned to the Rated Notesare based on Italian and English law, tax and administrative practice in effect at the date hereof, and havingdue regard to the expected tax treatment of all relevant entities under such law and practice. No assurancecan be given that Italian law, French law, English law, tax or administrative practice will not change after theIssue Date or that such change will not adversely impact the structure of the transaction and the treatment ofthe Notes.

The inability of the Issuer to pay interest or repay principal on the Notes may occur for reasons notrelated to the issues identified above and the Issuer does not represent that the risks and otherconsiderations relating to the holding of the Notes described above are exhaustive. While the variousstructural elements described in this Prospectus are intended to lessen some of the risks inherent in thetransaction for holders of the Notes, there can be no assurance that these measures will be sufficient oreffective to ensure payment of interest to the holders of the Notes on a timely basis or at all.

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THE PORTFOLIO

Mortgage Products

The Loans comprised in the Initial Pool are constituted by Italian law governed residential mortgage loansand, to a very limited extent, Italian law governed commercial mortgages loans. In particular, approximately97.98% of the Initial Pool is constituted by residential mortgage loans and 2.02% by commercial mortgageloans. The Loans are divided into two main categories:

(A) Standard Mortgage Loans:

Mortgage loans granted for the purposes of purchasing and restructuring residential real estate properties ingeneral and auto garages (although the latter are included generally only to the extent they pertain to the realestate property in question and are not financed individually).

(B) Non-Standard Mortgage Loans:

Mortgage loans granted for the purposes of consolidating existing debts and obtaining or replenishingliquidity without a specific purpose.

Loan To Value Ratio

The loan-to-value ratio does not exceed 100% and/or any lower value set for the relevant product by theOrigination Policies.

Mortgage Guarantees

Each Loan Agreement is secured by way of an economic first ranking mortgage on a real estate property, andadditionally, in some cases, by other personal or third party guarantees. As a matter of Italian law, mortgagesharden within 6 months from registration, unless they are mutui fondiari, in which case they harden within10 days from registration.

Mortgages will be registered for an amount exceeding the value of the corresponding loan (at least 180% ofthe loan amount). This is a precaution to ensure that there is adequate security at any time during the life ofthe mortgage loan.

Term of the Loans

Each Loan has a term of between 5 and 40 years.

Interest Rates

Interest rates on Loans can be of four types:

(A) Variable for Life:

Loans based on a 3-month Euribor rate;

(B) Fixed for Life:

Loans based on the interest rate swap (“IRS”) rate for the same term of the loan;

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(C) Modular:

Loans initially based on a 3-month Euribor index, where every three (3) year anniversary from originationthe mortgagor has the option to review the applicable conditions and to choose to exercise the option toswitch to a fixed rate for the following three 3 years, at the applicable 3 year euro interest rate swap rate atsuch time and at the same margin as the initial floating rate margin. If the mortgagor does not exercise theoption, the loan automatically resets to a variable rate.

(D) Win-Win:

Loan having a variable maturity whereby the original maturity date of the Loan may be extended for up to amaximum of ten years so as to maintain the instalment payments constant over the life of the Loan shouldthe three months Euribor increase. The maturity date of the loan may shorten following a subsequentdecrease in three months Euribor but may not be lower than the original maturity date

Interest Rate Reset

Under the Loan Agreement, all variable rate mortgage loans are reset every three months on the last day ofthe following months: January, April, July and October of each year subject to the Modified FollowingBusiness Day Convention. Such reset variable rate accrues from the immediately following business day forthe instalments due on or following the first day of the second month following resetting.

Repayment

The Loans have one repayment method, whereby, monthly instalments of interest and principal are payableso that on the stated maturity date for such Loan the full amount of principal advanced to the Borrower (inaddition to the interest) has been repaid.

Mortgage Payment Dates

All Loans pay monthly. Payment days throughout the month are automatically set by a dedicated procedure.Payments are made through an automatic direct debit on each relevant payment date. In case the direct debitpayment cannot be collected, alternative payment methods are arranged throughout the month.

CREDIT AND COLLECTION POLICIES

The Originator warrants to the Issuer, pursuant to the terms of the Master Transfer Agreement, inter alia,that any Loan has been originated and granted in accordance with the relevant Originator’s “Sofia” divisionguidelines (the Origination Policies). The following is a summary of such originations and collectionpolicies.

Origination and Underwriting

Mortgage Loan Originations

The Origination Policies outline the rules and the process adopted to originate an Loan from the assessmentof the creditworthiness of a potential borrower to the management of all the steps of a mortgage loanapplication up to the disbursement.

Distribution Channels

The Loans were originated by the Originator, but sourced via mortgage intermediaries, brokers, meaning anyunit/individual belonging to an external network with whom the Originator has signed a “commercialagreement” and which distributes mortgage loan products and acts as an agent for transactions.

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Agreements with new external distribution networks

Pursuant to the above commercial agreements mortgage intermediaries autonomously submits loanapplications to the Originator which will eventually accept or reject the application at its sole discretion.

Agreements with external distribution networks or brokers are contractually formalized. The network orbroker is one of the following:

• bank;

• financial intermediator;

• credit mediator.

Once the agreement has become effective, the Originator constantly monitors the activity of the mortgageintermediaries.

Parties Eligible for Financing

Save as otherwise provided under the Origination Policies, applicable to the specific distribution network,mortgage loans may be granted to individuals aged between 18 and 75, 75 being the maximum age of theborrower upon maturity of the loan.

(A) The following are eligible parties:

• Italian citizens;

• Citizens of an EU member state as defined in the Origination Policies; and

• Citizens of countries outside the EU as defined in the Origination Policies;

(B) Who have income deriving from:

• An indefinite term employment contract;

• A fixed term employment contract;

• An “atypical” employment contract;

• Self-employment; and

• Other regular monthly income (for example rental income, interest, etc.).

Loan Underwriting Process

The current mortgage loan underwriting criteria are part of the Originator’s “Key Operating Procedures”which also outline the procedures and guidelines governing the activities carried out throughout theprocessing of the mortgage loan application.

Selling (networks)

The distribution channel is in charge of developing contacts with potential borrowers, collecting thenecessary documentation, and carrying out all the preliminary activities related to the mortgage loanapplication. These activities include among the others:

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• Obtaining the necessary information to define the commercial terms/details of the loan;

• Collecting all necessary documentation to complete the loan application;

• Assisting the customer in filling out the mortgage request, obtaining the applicant’s signature onevery form where signature is required; and

• Entry of the application onto the system.

Application Review Process and assessment of “Creditworthiness”

Once the distribution network has entered the data, the application is forwarded electronically to theOriginator. Hard copies of the documents are also sent.

A “Mortgage Loan Analyst” (with no credit decision power) processes the application checking thedocumentation received and verifying that the conditions to grant the mortgage are met, including thesubstantial absence of any negative credit event of the borrower in public databases.

Upon receiving the outcome of the Application Review Process, the broker carries out the following:

• Notifies the customer of the outcome of his loan application;

• Sends to the designated Notary a request for the Preliminary Notary Report (Relazione NotarilePreliminare); and

• Sends to the competent/designated appraiser a request for appraisal;

Appraisal Process

Appraisals of mortgaged properties are carried out by specialised companies with whom the Originator hasentered into a specific agreement. In order to ensure high quality standards the appraisals’ supplier must beeither enrolled in the relevant Professional Registry or such activities must be permitted by theirMemorandum and Articles.

The request to proceed with the appraisal is sent by the broker. The Originator also provides a suggestedstandard appraisal form.

All appraisals entail the visit to the relevant property

The completed appraisal is sent by the appraiser to the Originator’s “Booking Team” via email. Thedocument must be sent in protected form.

Notary Report

The designated Notary sends the preliminary report to the Originator by email or fax. The Originator, uponreceipt of all necessary elements, makes the relevant decision.

In the event of:

• A positive outcome: the mortgage loan analyst delivers the complete file together with a summaryto the “Deliberating Party” of the Originator for evaluation;

• A negative outcome:

ITA80503 59

• the mortgage loan analyst records the outcome of the assessment and

• contacts the broker to establish the procedures to be followed for the conclusion of thematter.

In particular, the Mortgage Loan Analyst records the refusal on the system in accordance with applicableprocedures.

Decision Making Levels

There are 4 levels to the Sofia Credit Structure. The decision-making policy relies on a few key officers withextensive market expertise. These officers have different degrees of authority as to the amount of credit theycan approve. The levels are set out below:

Amounts of credit authorities

Deliberating Party White Applications Grey Applications Black Applications

Board of Directors > Euro 10,000,000. (1)

> Euro 1,500,000. (2)

Credit Risk Management PBC Euro 1,500,000.

Chairman Euro 300,000.

CEO DB Mutui Euro 300,000.

Head of SOFIA Division Euro 250,000. Euro 125,000.

Booking Responsible Euro 250,000. Euro 125,000. No powers

Credit Officer Euro 150,000. Euro 75,000. No powers

Notes:(1) Together with favourable opinion from CRM PBC upon recommendation from CRM DB AG(2) Together with favourable opinion from CRM PBC

Administration of the Portfolio

Unless otherwise set out herein, capitalised terms shall have the meaning given to them in Condition 1.

The “Servicing Team” of the Originator, is responsible for all the ordinary and extraordinary management ofthe Loan.

(A) Ordinary Management:

Funded mortgages periodic (daily / weekly) management:

(a) Determination of interest rate and periodical indexing;

(b) Automatic production of the list of the instalments falling due to be sent in the inter bank system fordirect debit;

(c) Verification of all unregistered payments for active monitoring; in particular daily monitoring of allunreconciled payments:

First instalment arrears are usually due to technical reasons, i.e. failure of the direct debit /inter bankprocedure. In all of these cases the Servicing Team must contact the relevant broker in order to verify with

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the Borrower the bank account details and to instruct the mortgagor to proceed with payment via banktransfer; and

From the second consecutive instalment overdue all arrears are managed as described in the Arrears andDefault Procedures section below:

(d) Change of borrower’s residential address (formal request must be received via mail);

(e) Early reimbursements (requests must be received by registered post, in accordance with contractualterms);

(f) Notification of the exercise of options regarding the type of interest rate; and

(g) Renewal of mortgage registrations.

(B) Extraordinary Management:

(a) Assignment by debtor of his debt to third party (Accollo),

(b) Release of guarantee both in the early reimbursement or natural expiry of the loan

(c) Management and execution –in case of necessity – of the accessories mortgage guarantees

Arrears and Default Procedures

The Servicer will be executing the collection activity on loans in arrears and defaulted loans. This activitywill be carried out by the Servicer in accordance with the relevant arrears procedural guidelines.

The IT system automatically:

(i) produces for each day a list of instalments falling due on that day for direct debit;

(ii) verifies that all payments made via home banking have been successful;

(iii) warns about any missed payment.

After the first missed instalment arrears management starts with a telephone call conducted by either thebank, a call centre or directly by the broker that supplied DB Mutui with the loan. The aim is to agree withthe borrower about the payment of the overdue instalment.

All loans will be transferred to the Call Centre for telephone collections. The involvement of the relevantbroker is envisaged if there has not been a payment within 7 days.

After the second consecutive missed instalment, on a weekly basis the servicing team sends out remindingletters and informs the client on upcoming actions in case of further missed payments.

After 15 days, both the call centre and the broker will be involved in making phone calls for additional 30days:

(i) if the borrower is willing to pay, a rescheduling of the mortgage can be agreed;

(ii) if the borrower does not cooperate, a real estate agency needs to be mandated by the borrower, for upto a 6 months’ period, to sell the property. The minimum sale price must allow for full recovery ofthe position.

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Should the property not be sold successfully the bank will start legal enforcement procedures and couldassign the position to a special servicer.

The Servicer

The Originator has been appointed as Servicer under the terms of the Servicing Agreement entered into on orabout the Issue Date between the Issuer, the Originator and the Representative of the Noteholders, toadminister the Loans and the Related Security on behalf of, and as agent for, the Issuer.

For more details of the Servicing Agreement and its provisions, see the section “Administration of thePortfolio” below.

CHARACTERISTICS OF THE INITIAL POOL

The Initial Pool has the aggregate characteristics indicated in the tables below (Columns of percentages maynot add up to 100 per cent. due to rounding). The information tables set out below have been prepared on thebasis of information available on the Initial Pool as of 19 November 2007.

Summary

Total Balance: €256,931,735Number of Loans: 1,761Average Loan Balance: €145,901Largest Loan Balance: €1,093,378WA Current LTV: 69.27%WA Coupon: 6.77%WA Margin for floating rate loans: 2.27%WA Remaining Term: 343 monthsWA Seasoning: 3 months

Year of Origination

YearNumber

ofLoans

% CurrentBalance € %

2007 1,761 100 256,931,735 100Total: 1,761 100.00 256,931,735 100.00

Original Balance

Original Balance €Number

ofLoans


0.01 - 50,000.00 129 7.33 5,101,319 1.9950,000.01 - 100,000.00 422 23.96 33,965,794 13.22100,000.01 - 150,000.00 574 32.6 73,157,047 28.47150,000.01 - 200,000.00 361 20.5 62,792,870 24.44200,000.01 - 250,000.00 129 7.33 28,969,964 11.28250,000.01 - 300,000.00 62 3.52 16,961,406 6.6300,000.01 - 350,000.00 27 1.53 8,851,104 3.44350,000.01 - 400,000.00 23 1.31 8,710,447 3.39

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400,000.01 - 450,000.00 6 0.34 2,521,806 0.98450,000.01 - 500,000.00 12 0.68 5,846,463 2.28500,000.01 - 550,000.00 5 0.28 2,562,384 1550,000.01 - 600,000.00 3 0.17 1,777,954 0.69600,000.01 - 650,000.00 4 0.23 2,497,768 0.97650,000.01 - 700,000.00 1 0.06 648,663 0.25700,000.01 - 750,000.00 2 0.11 1,473,366 0.571,000,000.01 >= 1 0.06 1,093,378 0.43Total: 1,761 100.00 256,931,735 100.00

Minimum: €20,200Maximum: €1,100,000Average: €146,352

Current Balance

Current Balance €Number

ofLoans


0.01 - 50,000.00 129 7.33 5,101,319 1.9950,000.01 - 100,000.00 428 24.3 34,564,161 13.45100,000.01 - 150,000.00 570 32.37 72,856,442 28.36150,000.01 - 200,000.00 360 20.44 62,694,350 24.4200,000.01 - 250,000.00 133 7.55 30,016,479 11.68250,000.01 - 300,000.00 60 3.41 16,610,661 6.47300,000.01 - 350,000.00 24 1.36 7,956,094 3.1350,000.01 - 400,000.00 25 1.42 9,503,457 3.7400,000.01 - 450,000.00 4 0.23 1,728,796 0.67450,000.01 - 500,000.00 14 0.8 6,842,774 2.66500,000.01 - 550,000.00 3 0.17 1,566,073 0.61550,000.01 - 600,000.00 4 0.23 2,377,718 0.93600,000.01 - 650,000.00 4 0.23 2,546,668 0.99700,000.01 - 750,000.00 2 0.11 1,473,366 0.571,000,000.01 >= 1 0.06 1,093,378 0.43Total: 1,761 100.00 256,931,735 100.00

Minimum: €20,144Maximum: €1,093,378Average: €145,901

Original Term

Original TermNumber

ofLoans


61 - 120 13 0.74 918,610 0.36121 - 180 118 6.7 12,170,108 4.74181 - 240 229 13 28,052,634 10.92241 - 300 231 13.12 33,698,177 13.12301 - 360 691 39.24 110,375,487 42.96

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361 - 420 424 24.08 63,532,526 24.73421 - 480 55 3.12 8,184,194 3.19Total: 1,761 100.00 256,931,735 100.00

Minimum: 120 monthsMaximum: 480 monthsWeighted Average: 346 months

Remaining Term

Remaining TermNumber

ofLoans


61 - 120 13 0.74 918,610 0.36121 - 180 118 6.7 12,170,108 4.74181 - 240 229 13 28,052,634 10.92241 - 300 231 13.12 33,698,177 13.12301 - 360 691 39.24 110,375,487 42.96361 - 420 424 24.08 63,532,526 24.73421 - 480 55 3.12 8,184,194 3.19Total: 1,761 100.00 256,931,735 100.00


Loan Age

Loan AgeNumber

ofLoans


0 <= 244 13.86 37,340,193 14.531 - 6 1,516 86.09 219,541,276 85.457 - 12 1 0.06 50,266 0.02Total: 1,761 100.00 256,931,735 100.00


Redemption Type

Redemption TypeNumber

ofLoans


Annuity 1,761 100 256,931,735 100Total: 1,761 100.00 256,931,735 100.00

Rate Type

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Rate TypeNumber

ofLoans


Floating Rate 1,226 69.62 185,783,128 72.31Modular 477 27.09 63,271,159 24.63Fixed Rate 58 3.29 7,877,448 3.07Total: 1,761 100.00 256,931,735 100.00

Current Interest Rate

Current Interest Rate %Number

ofLoans


<= 4.00 3 0.17 567,961 0.225.01 - 5.25 2 0.11 212,301 0.085.26 - 5.50 13 0.74 2,151,493 0.845.51 - 5.75 20 1.14 3,380,884 1.325.76 - 6.00 101 5.74 16,749,032 6.526.01 - 6.25 239 13.57 32,730,750 12.746.26 - 6.50 252 14.31 38,089,187 14.826.51 - 6.75 241 13.69 33,809,375 13.166.76 - 7.00 206 11.7 25,819,636 10.057.01 - 7.25 302 17.15 44,467,604 17.317.26 - 7.50 185 10.51 26,510,928 10.327.51 - 7.75 153 8.69 22,650,280 8.827.76 - 8.00 44 2.5 9,792,304 3.81Total: 1,761 100.00 256,931,735 100.00

Minimum: 2.73%Maximum: 7.85%Weighted Average: 6.77%

Current Margin over EURIBOR(Floating rate and Modular Loansonly)

Current Spread %Number

ofLoans


0.76 - 1.00 7 0.41 1,005,766 0.41.01 - 1.25 30 1.76 4,727,305 1.91.26 - 1.50 61 3.58 9,946,855 3.991.51 - 1.75 183 10.75 30,128,192 12.11.76 - 2.00 513 30.12 70,065,479 28.132.01 - 2.25 137 8.04 18,486,781 7.422.26 - 2.50 171 10.04 26,354,766 10.582.51 - 2.75 9 0.53 1,318,637 0.532.76 - 3.00 592 34.76 87,020,506 34.94Total: 1,703 100.00 249,054,287 100.00

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Minimum: 1.00%Maximum: 2.99%Weighted Average: 2.27%

Current LTV Ratio

Current LTV RatioNumber

ofLoans


0.01 - 25.00 50 2.84 5,060,680 1.9725.01 - 50.00 448 25.44 57,058,273 22.2150.01 - 55.00 100 5.68 16,784,513 6.5355.01 - 60.00 53 3.01 8,681,953 3.3860.01 - 65.00 113 6.42 19,438,761 7.5765.01 - 70.00 79 4.49 11,865,824 4.6270.01 - 75.00 153 8.69 26,440,113 10.2975.01 - 80.00 195 11.07 29,899,142 11.6480.01 - 85.00 60 3.41 9,288,150 3.6285.01 - 90.00 162 9.2 23,435,660 9.1290.01 - 95.00 104 5.91 15,853,557 6.1795.01 - 100.00 244 13.86 33,125,108 12.89Total: 1,761 100.00 256,931,735 100.00

Minimum: 10.23%Maximum: 100.00%WA: 69.27%

Property Type

Property TypeNumber

ofLoans


Flat 1,487 84.44 205,950,082 80.16Detached House 138 7.84 29,062,327 11.31Semi-Detached House 102 5.79 16,720,492 6.51Small Commercial 34 1.93 5,198,834 2.02Total: 1,761 100.00 256,931,735 100.00

Owner Occupied

Owner OccupiedNumber

ofLoans


Owner Occupied 1,723 97.84 251,264,085 97.79Non Owner Occupied 38 2.16 5,667,650 2.21Total: 1,761 100.00 256,931,735 100.00

Second Home

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Second HomeNumber

ofLoans


No 1,729 98.18 251,662,223 97.95Yes 32 1.82 5,269,512 2.05Total: 1,761 100.00 256,931,735 100.00

Political Region

Political RegionNumber

ofLoans


Lombardia 625 35.49 90,795,696 35.34Lazio 324 18.4 55,664,323 21.67Campania 200 11.36 26,537,569 10.33Sicilia 147 8.35 19,367,707 7.54Veneto 79 4.49 10,621,496 4.13Piemonte 67 3.8 8,945,283 3.48Liguria 61 3.46 8,745,952 3.4Calabria 52 2.95 7,527,134 2.93Toscana 43 2.44 6,782,614 2.64Emilia Romagna 34 1.93 6,046,289 2.35Puglia 52 2.95 5,816,533 2.26Sardegna 22 1.25 2,252,252 0.88Friuli Venezia Giulia 17 0.97 2,245,843 0.87Umbria 12 0.68 2,080,514 0.81Abruzzo 9 0.51 1,062,023 0.41Molise 7 0.4 963,231 0.37Marche 5 0.28 607,673 0.24Trentino Alto Adige 1 0.06 538,950 0.21Basilicata 4 0.23 330,653 0.13Total: 1,761 100.00 256,931,735 100.00

Geographic Region

Geographic RegionNumber

ofLoans


North 884 50.2 127,939,509 49.8Central 384 21.81 65,135,124 25.35South & Islands 493 28 63,857,102 24.85Total: 1,761 100.00 256,931,735 100.00

Loan Purpose

Loan PurposeNumber

ofLoans


Purchase primary residence 834 47.36 125,669,252 48.91Consolidation 424 24.08 67,576,258 26.3Cash-out Refinance 449 25.5 54,556,277 21.23

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Purchase other residential 31 1.76 5,139,280 2Purchase commercial 21 1.19 3,805,436 1.48Purchase ancillary spaces 2nd home 1 0.06 130,232 0.05Purchase and restructuring commercial units, stores andoffices 1 0.06 55,000 0.02Total: 1,761 100.00 256,931,735 100.00

Self Certified Income

Self Certified IncomeNumber

ofLoans


No 1,757 99.77 256,410,421 99.8Yes 4 0.23 521,314 0.2Total: 1,761 100.00 256,931,735 100.00

Employment

EmploymentNumber

ofLoans


Employed 1,262 71.66 168,643,921 65.64Self-employed 425 24.13 79,831,761 31.07Retired 73 4.15 8,411,612 3.27Other 1 0.06 44,440 0.02Total: 1,761 100.00 256,931,735 100.00

Days Delinquent

Days DelinquentNumber

ofLoans


0 1,647 93.53 240,551,901 93.621- 30 93 5.28 13,697,664 5.3331 - 60 15 0.85 1,882,510 0.7361 - 90 6 0.34 799,660 0.31Total: 1,761 100.00 256,931,735 100.00

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THE ORIGINATOR

History

Deutsche Bank Mutui S.p.A. has been carrying on the activity of specialised mortgage lending for over 25years.

The key corporate events in its history are as follows:

• 1973: established under the name of Caboto S.p.A.;

• 1979: acquired by Milano Centrale S.p.A.;

• 1984: becomes known as Caboto-Milano Centrale S.p.A.;

• 1986: Pirelli & C became 100% owner and the name was changed to Milano Centrale Mutui S.p.A..It is registered in the elenco generale degli Intermediari Finanziari (list of financial intermediarieskept by the Bank of Italy);

• 1997: sold to Deutsche Bank S.p.A. (DB S.p.A.);

• 1998: name changed to Deutsche Bank Mutui S.p.A..

Officially constituted as a bank on 3 July 2000, DB Mutui is registered with the Italian register of banks as afully licensed bank. It is part of the Deutsche Bank group operating within the Private and Business Clientdivision, under the management and coordination of Deutsche Bank S.p.A..

The registered office of DB Mutui is at Via Santa Sofia n.10, Milan, Italy and its Tax Code and VAT numberis 08226630153. Its share capital is euro 48,000,000 and it is a member of the Deposit Protection InterbankFund.

DB Mutui operates within the Italian consumer finance market focusing on two different segments:

• real estate mortgages (which is its core business); and

• personal loans backed by the assignment of one fifth of the salary of the borrower (cessione delquinto dello stipendio).

As regards the distribution of mortgages, DB Mutui is part of the DB S.p.A. mortgage distribution platform,together with Deutsche Bank’s network of retail branches and Prestitempo, a specialised consumer financecompany and division of DB S.p.A..

Within Deutsche Bank S.p.A., DB Mutui has established itself as a mortgage boutique targeting selectedhigh net worth clients offering a tailored service and innovative mortgage products.

In September 2006, the DB Mutui Board of Directors approved a new strategic plan which contemplated,inter alia:

• creating a specific division within DB Mutui (the Sofia Division) with an independent administrativestructure;

• broadening its client base by targeting new customer segments (not only high net-worth clients),including employed, self employed, atypical workers and non-EU citizens;

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• expanding the range of products on offer, by adding cash-out, refinancing and consolidationmortgages; and

• diversifying the distribution channels while originating exclusively through internal and externalselected partners.

Operational Structure

The management of DB Mutui is overseen by a Board of Directors and a Board of Statutory Auditors.

The Board of Directors comprises the following persons:

Giulio Cesare Monarca ChairmanFranco di Pinto Chief Executive DirectorPier Paolo Cellerino DirectorJochen Kloepper Director

The Board of Statutory Auditors (Collegio Sindacale) is composed of the following:

Achille Frattini ChairmanAdriano Angeli AuditorUgo Rock AuditorClaudio Diamante Deputy AuditorFrancesca Meneghel Deputy Auditor

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THE LIQUIDITY PROVIDER

Except for the information provided in the preceding paragraph of this section the Liquidity Provider hasnot been involved in the preparation of, and does not accept responsibility for, this Prospectus.

Deutsche Bank S.p.A. is the Liquidity Provider.

Deutsche Bank S.p.A. is a bank incorporated under the laws of Italy, whose registered office is at Piazza delCalendario n. 3, Milan, and registered with the companies register of Milan under number 01340740156 andwith the register held by the Bank of Italy pursuant to article 13 of the Banking Act under number 3104.

The share capital of Deutsche Bank S.p.A. amounts to € 310,659,856.26, 94 per cent. of which was ownedby Deutsche Bank AG as at 1 January 2007.

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THE HEDGING COUNTERPARTY

Except for the information provided in the preceding paragraph of this section the Hedging Counterpartyhas not been involved in the preparation of, and does not accept responsibility for, this Prospectus.

Deutsche Bank Aktiengesellschaft (“Deutsche Bank” or the “Bank”) originated from the reunification ofNorddeutsche Bank Aktiengesellschaft, Hamburg, Rheinisch-Westfälische Bank Aktiengesellschaft,Duesseldorf and Süddeutsche Bank Aktiengesellschaft, Munich; pursuant to the Law on the Regional Scopeof Credit Institutions, these had been disincorporated in 1952 from Deutsche Bank which was founded in1870. The merger and the name were entered in the Commercial Register of the District Court Frankfurt amMain on 2 May 1957. Deutsche Bank is a banking institution and a stock corporation incorporated under thelaws of Germany under registration number HRB 30 000. The Bank has its registered office in Frankfurt amMain, Germany. It maintains its head office at Theodor-Heuss-Allee 70, 60486 Frankfurt am Main andbranch offices in Germany and abroad including in London, New York, Sydney, Tokyo and an Asia-PacificHead Office in Singapore which serve as hubs for its operations in the respective regions.

The Bank is the parent company of a group consisting of banks, capital market companies, fund managementcompanies, a real estate finance company, instalment financing companies, research and consultancycompanies and other domestic and foreign companies (the “Deutsche Bank Group”).

“Deutsche Bank AG London branch” is the London branch of Deutsche Bank AG. On 12 January 1973,Deutsche Bank AG filed in the United Kingdom the documents required pursuant to section 407 of theCompanies Act 1948 to establish a place of business within Great Britain. On 14 January 1993, DeutscheBank registered under Schedule 21A to the Companies Act 1985 as having established a branch (RegistrationNo. BR000005) in England and Wales. Deutsche Bank AG London is an authorized person for the purposesof section 19 of the Financial Services and Markets Act 2000. In the United Kingdom, it conducts wholesalebanking business and through its Private Wealth Management division, it provides holistic wealthmanagement advice and integrated financial solutions for wealthy individuals, their families and selectedinstitutions.

As of 30 September 2007, Deutsche Bank’s issued share capital amounted to Euro 1,352,634,915.84consisting of 528,373,014 ordinary shares without par value. The shares are fully paid up and in registeredform. The shares are listed for trading and official quotation on all the German Stock Exchanges. They arealso listed on the New York Stock Exchange.

The consolidated financial statements for fiscal years starting 1 January 2007 are prepared in compliancewith International Financial Reporting Standards (IFRS). As of 30 September 2007, Deutsche Bank Grouphad total assets of EUR 1,879,012 million, total liabilities of EUR 1,841,470 million and total equity of EUR37,542 million on the basis of IFRS (unaudited).

Deutsche Bank’s long-term senior debt has been assigned a rating of AA (outlook stable) by Standard &Poor’s and Aa1 (outlook stable) by Moody’s Investors Services.

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THE ISSUER

Eurohome (Italy) Mortgages S.r.l. (the Issuer), was incorporated on 15 November 2006 under the name ofOrange Finance S.r.l., as a limited liability company (società a responsabilità limitata) organised under thelaws of the Republic of Italy and pursuant to the Italian Securitisation Law. The Issuer was established as aspecial purpose vehicle for the purpose of issuing asset backed securities. The Issuer has been dormant sinceit was incorporated and has not commenced operations, although it has produced financial statements asrequired to do so. The Issuer has no employees.

The Issuer’s registered office is at Via Eleonora Duse 53, Rome, tax code and registration with the Registerof Enterprises of Rome, Italy, No. 09218951003. The telephone number of the Issuer is +39 06 8091531.

The by-laws (statuto) of the Issuer provide that the present life of the company ends on 31 December, 2060.The Issuer is registered in the general register of the financial intermediaries held by the Ufficio ItalianoCambi pursuant to Article 106 of the Italian Banking Act with no. 39050 and in the special register of thefinancial intermediaries held by the Bank of Italy pursuant to Article 107 of the Italian Banking Act, havingas its sole corporate object the realisation of one or more securitisation transactions pursuant to Article 3 ofthe Italian Securitisation Law.

The constitutional documents and the financial statements of the Issuer will be available for inspection inphysical form at its registered office during normal office hours.

The quota capital of the Issuer is Euro 10,000 (fully paid-up). As at the date of this document the solequotaholder of the Issuer is Stichting Muidenburg, with registered office at Amsteldijk 166, 1079LHAmsterdam.

Sole Director

The sole director of the Issuer and his respective business addresses is:

NAME BUSINESS ADDRESS (ROME) ROLE

Gordon Edwin Charles Burrows Vial Eleonora Duse, 53 Sole Director

The principal activity performed by the sole director when not acting as such in relation to the Issuer is thatof company director of other companies.

No statutory auditors (sindaci) have been appointed.

External Auditors

The external auditors of the Issuer are PKF Italia S.p.A., with registered office at Viale Vittorio Veneto, 10 –20124 Milano (MI), whose partners are members of the Consiglio Nazionale dei Dottori Commercialisti andregistered in the Registro dei Revisori Contabili.

Administration

Pursuant to the Corporate Services Agreement entered into on or prior to the Issue Date between the Issuer,the Corporate Servicer (the Corporate Services Agreement), the Corporate Servicer has agreed to providecertain corporate administration, management accounting and administrative services to the Issuer including,inter alia, the safekeeping of documentation pertaining to meetings of the Issuer’s quotaholders anddirectors, maintaining the quotaholders’ register, preparing VAT and other tax and accounting records,preparing the Issuer’s annual financial statements and administering all matters relating to the taxation of theIssuer.

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The Corporate Services Agreement contains provisions requiring that no resignation by or termination of theappointment of the Corporate Servicer shall take effect unless and until a new entity is appointed asCorporate Servicer.

Financial Statements and Report of the Auditors

The financial statements prepared on behalf of the Issuer as at 31 December 2006 and the audit report are setout in Appendix 1 to this Offering Circular. Since 31 December 2006, there has been no significant adversechange in the financial position or prospects, nor in the trading or financial position, of the Issuer. Thefinancial statements set out in Appendix 1 to this Offering Circular comprise the Issuer’s statutory accountsprepared in accordance to Italian accounting principles. The financial statements for the year ending on 31December 2007 will be available no later than the end of April 2008.

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USE OF PROCEEDS

The net proceeds from the issue of the Notes, being Euro 260,850,000 in aggregate, will be applied by theIssuer on the Issue Date as follows:

(i) to pay to the Originator the Purchase Price of the Initial Pool due and payable on the Issue Date;

(ii) to credit the Cash Reserve with the Cash Reserve Amount;

(iii) to credit the Expenses Account with the Quarterly Maintenance Amount; and

(iv) to pay certain initial expenses.

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PURCHASE OF THE PORTFOLIO

The following section relating to the title to and the purchase of the Portfolio is a summary of certainprovisions contained in the Master Transfer Agreement and is qualified by reference to the detailedprovisions of the terms and conditions of the Master Transfer Agreement. Unless otherwise set out herein,capitalised terms shall have the meaning assigned to them in the Glossary of Terms.

THE MASTER TRANSFER AGREEMENT

On 12 December 2007, the Originator, the Issuer and the Representative of the Noteholders entered into theMaster Transfer Agreement, as amended on 20 December 2007, pursuant to which the Originator sold theInitial Pool to the Issuer without recourse (pro soluto), in accordance with Articles 1 and 4 of the ItalianSecuritisation Law and subject to the terms and conditions thereof. The transfer of the Initial Pool from theOriginator to the Issuer took economic effect as between the Originator and the Issuer from the Initial Cut-Off Date (excluded) and the Issuer is entitled to all rights, title and interest in and to the Initial Pool(including all Collections thereunder) from (but excluding) the Initial Cut-Off Date.

The purchase price payable by the Issuer to the Originator in respect of the Initial Pool is equal to theprincipal amount outstanding of the Loan Receivables comprised in the Initial Pool as at the Initial Cut-OffDate. On 18 December 2007 a notice of the transfer of the Initial Pool from the Originator to the Issuer waspublished in the Italian Official Gazette in accordance with Article 4 of the Italian Securitisation Law and on18 December 2007 such notice was deposited with and accepted for recording by the Register of Enterprisesof the Issuer.

During the Revolving Period, the Originator may transfer and sell to the Issuer and the Issuer shall purchasefrom the Originator, without recourse (pro soluto), in accordance with Articles 1 and 4 of the ItalianSecuritisation Law and subject to the terms and conditions set out in the Master Transfer Agreement and arelevant Purchase Agreement, Additional Pools complying with identification criteria equal to the criteria inrespect of the Initial Pool and, where necessary, supplemented by the Specific Criteria, so as to ensure thelegal and economic homogeneity of the Loan Receivables comprised in the Portfolio. The Issuer shallpurchase Additional Pool from the Originator, subject to, inter alia, the following conditions:

(i) no Termination Event (as defined below) having occurred and being continuing, and

(ii) the Additional Pool Requirements having been met.

The transfer of each Additional Pool from the Originator to the Issuer will take economic effect as betweenthe Originator and the Issuer from the relevant Cut-Off Date (excluded) and the Issuer will be entitled to allrights, title and interest in and to the relevant Additional Pool (including all Collections thereunder) from(but excluding) the relevant Cut-Off Date.

The Master Transfer Agreement and any Purchase Agreement will terminate with effect ab initio as set outin the Master Transfer Agreement if by 15 January 2008 (i) the Transaction Documents have not beenexecuted and have not come into force, and/or the Notes have not been issued, subscribed and paid for, and(ii) any of the Loan Receivables comprised in the relevant Pool and/or the relevant Collections being subjectto attachment, seizure or other enforcement procedure pursued by any third party in the period starting fromthe relevant Cut-Off Date (excluded) and ending on the date of publication of the relevant notice ofassignment in the Italian Official Gazette (included).

For the purpose of the Master Transfer Agreement, Termination Event means the occurrence of any of thefollowing events:

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Termination Events relating to DB Mutui

§ Non payment: DB Mutui fails to pay any amount due by it under any of the Transaction Documentsto which it is a party within two Business Days of its due date, or in the event that such failure iscaused by administrative difficulties or settlement error or is of an amount disputed in good faith,within five Business Days therefrom;

§ Failure to perform: DB Mutui fails to observe or perform any of its obligations under theTransaction Documents to which it is a party or under any undertaking or arrangement entered intoin connection therewith and such failure (i) would, in the reasonable opinion of the Representative ofthe Noteholders, be likely to have a material adverse effect on (A) the ability of DB Mutui toperform its respective obligations under the Transaction Documents; and (ii) (if capable of remedybefore the expiry of such period) continues unremedied for a period of 15 days from the date theRepresentative of the Noteholders gives notice to DB Mutui requiring the same to be remedied;

§ Material adverse effect: any event or series of events (whether related or not) occurs which in thereasonable opinion of the Representative of the Noteholders will have a material adverse effect on:(a) the enforceability and collectability of the Loan Receivables and/or the origination of the LoanReceivables; (b) the ability of DB Mutui or the Servicer to perform its obligations under theTransaction Documents to which it is a party; or (c) the validity or enforceability of any TransactionDocument to which DB Mutui is a party;

§ Attachments: all or any part of the property, business, undertakings, assets or revenues of DB Mutuihaving an aggregate value in excess of Euro 1 million has been attached as a result of any distress orexecution being levied or any encumbrance taking possession or similar attachment and suchattachment has not been lifted within 30 days, unless in any such case the Representative of theNoteholders certifies that in its reasonable opinion such event will not materially prejudice theability of DB Mutui to observe or perform its obligations under the Transaction Documents or theenforceability, collectability or origination of the Loan Receivables;

§ Arrangements with creditors: DB Mutui convenes a meeting of its creditors or proposes or makesany arrangement or composition with, or any assignment for the benefit of, or any moratorium withits creditors (other than for the purposes of a solvent reconstruction or amalgamation on such termsand within such period as may previously have been approved in writing by the Representative ofthe Noteholders) or any other corporate action is taken or any legal proceedings are commenced byDB Mutui with a view to any such composition, arrangement, assignment or moratorium beingmade;

§ Petition for liquidation: a petition (other than a petition which is dismissed or stayed within 60 daysof being instituted) is presented or a meeting is convened for the purpose of considering a resolutionor other preparatory steps are taken or legal proceedings are commenced for the liquidation,dissolution, administration or reorganisation of DB Mutui in accordance with the provisions set outin the Italian Banking Act (other than for the purposes of a solvent reconstruction or amalgamationon such terms and within such period as may previously have been approved in writing by theRepresentative of the Noteholders);

§ Insolvency: DB Mutui is or becomes or is declared to be insolvent (including bankruptcy andsuspension of payments) or is or becomes unable to pay its debts as they fall due or suspends orthreatens to suspend making payments (whether of principal or interest) with respect to all or anyclass of its debts;

§ Disputes: DB Mutui disputes, in any manner, the validity or efficacy of any sale and purchase of aLoan Receivable under the Master Transfer Agreement or any Purchase Agreement and as a result,in the reasonable opinion of the Representative of the Noteholders, there is, or is likely to be, a

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material adverse effect on the ability of DB Mutui to perform their respective obligations under theTransaction Documents or the enforceability and collectability of the Loan Receivables and/or theorigination of the Loan Receivables is, or is likely to be, materially prejudiced;

§ Cessation of business: it becomes impossible or unlawful for DB Mutui to continue its businessand/or discharge its obligations as contemplated by the Transaction Documents and as a result, in thereasonable opinion of the Representative of the Noteholders, there is, or is likely to be, a materialadverse effect on the ability of DB Mutui to perform its obligations under the TransactionDocuments or the enforceability and collectability of the Loan Receivables and/or the origination ofthe Loan Receivables is, or is likely to be, materially prejudiced;

§ Servicer Termination Event: the occurrence of a Servicer Termination Event (notwithstanding theappointment of any substitute servicer in accordance with the Servicing Agreement);

§ Incorrect representations: any representation and warranty of the DB Mutui set out in Schedule 8Paragraph 2 to the Master Transfer Agreement or any other representation or warranty which iscontained in any certificate, statement, legal opinion or notice provided under or in connection withthe Transaction Documents proves to be incorrect in any material respect, or if repeated at any timewith reference to the facts and circumstances subsisting at such time would not be accurate in allmaterial respects unless, if curable, cured to the satisfaction of the Representative of the Noteholderswithin 10 Business Days of notification by the relevant person to the Representative of theNoteholders;

§ Invalidity: any Transaction Document, or any material provision thereof ceases to be valid andbinding on DB Mutui or if DB Mutui states so in writing;

Termination Events relating to the Portfolio and the Notes

§ Unpaid Principal Deficiency: the Unpaid Principal Deficiency is higher than 0.5%;

§ Arrears Ratio: the Arrears Ratio is higher than 3.0%;

§ Principal Deficiency Sub-Ledgers: the balance of any of the Principal Deficiency Sub-Ledgers ishigher than zero;

§ Cash Reserve Account: the Cash Reserve Balance is lower than Cash Reserve Required Amount;

§ Liquidity Facility: drawings have been made by the Issuer and are outstanding under the LiquidityFacility Agreement;

§ Event of Default: An Event of Default and/or an Issuer Insolvency Event has occurred pursuant tothe Conditions.

§ Tax or Regulatory Event: A Tax or Regulatory Event has occurred under the Conditions.

CRITERIA

The Loan Receivables comprised in the Initial Pool comply with the identification criteria – on the basis ofwhich they are capable of being identified as a “block” pursuant to Articles 1 and 4 of the ItalianSecuritisation Law (pluralità di crediti pecuniari individuabili in blocco) – set-out in the Master TransferAgreement. For a description of the characteristics of the Initial Pool see section Description of the MortgageLoans.

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Pursuant to the Master Transfer Agreement, the Originator has transferred to the Issuer, which havepurchased, all the Loan Receivables comprised in the Initial Pool which on the close of business on 19November 2007 (the Initial Cut-Off Date) satisfied the following criteria (the Initial Criteria):

1. were all denominated in euro;

2. were classified as “mutuo fondiario” or “mutuo ipotecario”;

3. the relevant borrower was, at the time of the disbursement of the relevant loan, resident in Italy;

4. the relevant loan agreement was denominated “Mutuo Sofia”;

5. the relevant amount was fully drawn down by DB Mutui;

6. had a “French” amortization profile or had an amortization plan which may be extended (so called“Win-Win” mortgage loans).

7. were never classified as defaulted loan receivables (“crediti in sofferenza”), as delinquent loanreceivables (“crediti incagliati”), restructured debts (“crediti ristrutturati”) or in the process ofbeing restructured (“crediti in corso di ristrutturazione”) in accordance with Bank of Italy’sguidelines;

8. had an original LTV not exceeding 100%;

9. were secured by a first ranking economic mortgage (“ipoteca di primo grado economico”) over realestate assets located in the territory of the Republic of Italy which is (i) a first ranking prioritymortgage (“ipoteca di primo grado legale”); or (ii) a subsequent ranking priority mortgage (“ipotecadi grado legale successivo”) where (A) the obligations secured by the mortgage(s) ranking inpriority thereto have been fully satisfied; or (B) (1) the higher ranking mortgage was granted and isrecorded exclusively in favour of Deutsche Bank Mutui S.p.A., and (2) the obligations secured bythe higher ranking mortgage(s) relate exclusively to a different receivable transferred by DeutscheBank Mutui S.p.A. to Eurohome (Italy) Mortgages S.r.l. under the same Master Transfer AgreementPROVIDED THAT (as of the date of drawdown of the loan relating to such receivable) the sum of:(i) the principal outstanding amount of the receivable secured by the higher ranking mortgages; and(ii) the principal amount of the receivable secured by the lowest ranking mortgage did not exceed100% of the appraised value (“valore di perizia”) of the relevant asset as of the time of disbursementof the relevant loan.

10. were granted to private individuals (“famiglie”, as the term is defined in the Istruzioni di Vigilanzaissued by Bank of Italy);

11. provided for payment of instalments on a monthly basis;

12. provided for payment of instalments by way of RID (direct debit) system;

13. were secured by real estate assets that were completed (not under construction);

14. had a principal amount not higher than Euro 1,100,000;

15. had a legal maturity not longer than November 2047;

16. neither the amount granted thereunder nor the relevant mortgage were divided;

17. did not classify as construction loans;

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18. did not classify as agricultural loans (credito agrario o peschereccio);

19. were not granted to employees of Deutsche Bank Mutui S.p.A.;

20. did not classify as “convenzionati” loans, i.e. they were not entered into in the context of specificarrangements between Deutsche Bank Mutui S.p.A. and any public entity, member of the publicadministration, companies or other entities which provided for favourable terms and conditions toany of their employees and contractors;

21. did not classify as “agevolati” loans, for which it was not provided any form of contribution by anypublic entity in respect of the repayment of principal or the payment of interest thereunder;

22. which did not have more than 1 (one) monthly instalment in arrears;

23. (i) had a fixed rate, (ii) did not have any unpaid instalment and (iii) had an original LTV equal orlower than 66%;

24. had a fixed rate and (ii) were secured by a mortgage on real estates located in any of the followingRegions: Sicily, Calabria, Sardinia, Basilicata, Puglia, Molise, Abruzzo and Campania; and

25. were secured by a mortgage on real estates located in any of the following regions: Sicily, Calabria,Sardinia, Basilicata, Puglia, Molise, Abruzzo and Campania, (ii) did not have any unpaid instalmentand (iii) had an original LTV equal or lower than 78%.

The Loan Receivables comprised in each Additional Pool will comply with identification criteria set out inthe relevant Purchase Agreement, equal to the Initial Criteria and, where necessary, supplemented by theSpecific Criteria (the Additional Criteria).

The Master Transfer Agreement provides that (i) if any of the Loan Receivables comprised in a Pool as listedin the Relevant List does not meet the relevant Criteria (each such Loan Receivable being a Excluded LoanReceivable), then each such Excluded Receivable will be deemed not to have been assigned and transferredto the Issuer pursuant to the Master Transfer Agreement and the relevant Purchase Agreement and (ii) if anyreceivable meeting the relevant Criteria has not been transferred to the Issuer (each such Loan Receivablebeing an Included Loan Receivable) shall be deemed to have been assigned and transferred to the Issuer byOriginator with economic effect from the relevant Cut-Off Date.

REPRESENTATIONS AND WARRANTIES OF THE ORIGINATOR

The Originator has acknowledged that the Issuer has entered into the Master Transfer Agreement in relianceupon the representations, warranties and indemnities given by Originator in the Master Transfer Agreement.

The Originator (i) has represented and warranted (as at the Transfer Date and the Issue Date) in respect of theInitial Pool transferred by it to the Issuer pursuant to the Master Transfer Agreement, and (i) will representand warrant (as at the relevant Cut-Off Date, Offer Date and Transfer Date), in respect of any AdditionalPool transferred by it to the Issuer pursuant to the Master Transfer Agreement and the relevant PurchaseAgreement (save for those provisions of the Loan Agreements on which the Decree No. 7 may have animpact (see Risk Factors – Decree 31 January 2007, No. 7), that:

Loan Receivables

(i) DB Mutui is a party to each Loan Agreement and, as creditor, has full and unrestricted title to, andthe benefit of, each Loan Receivable and Related Security;

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(ii) the Loan Receivables are valid and existing and, as at close of business on the relevant Cut-Off Date,had the value indicated in the Relevant List;

(iii) DB Mutui is the absolute legal and beneficial owner of the Loan Receivables, and has not assigned,sold, transferred (whether absolutely or by way of security), mortgaged, charged or otherwisedisposed of any of its rights, title, interest or benefit in any Loan Agreement or Related Security, norterminated, nor waived, amended or varied (otherwise than in accordance with the loan managementand claim recovery policies from time to time adopted by DB Mutui and in accordance with allprudent and customary banking practices) any of the terms of any Loan Agreement or RelatedSecurity or created or allowed to be created or exist any Security Interest on or over any LoanReceivable, Loan Agreement or Related Security nor will it do so, other than pursuant to theTransaction Documents to which it is or is to become a party;

(iv) each of the Loan Receivables and Related Securities is freely and immediately transferable and theassignment and/or transfer of the Loan Receivables and Related Securities by DB Mutui to the Issuerpursuant to the Master Transfer Agreement and the Purchase Agreement (if any) will not affect thelegality, validity or enforceability of any obligation of any Borrower or Guarantor:

(A) under the relevant Loan Agreement or Related Security or,

(B) under any applicable law or regulation or pursuant to order of any competent authority;

(v) all data and information supplied or made available by DB Mutui to the Issuer or its affiliates,employees representatives, agents, advisers and/or consultants, for the purpose of or in connectionwith this Agreement and the other Transaction Documents, are or will be, at the time of suchinclusion true, correct, accurate and complete in all material respects and no relevant informationavailable to it in respect of this Agreement and the other Transaction Documents has been or, as thecase may be, will be, omitted therefrom;

(vi) (A) all the Loans Receivables comprised in each Pool comply with the relevant Criteria and eachPool possesses specific objective common elements such as to constitute, on the basis of the relevantCriteria, a portfolio of homogeneous monetary claims capable of being identified as a pool (uninsieme di crediti pecuniari individuabili in blocco) within the meaning and for the purposes of theItalian Securitisation Law; and (B) as of the relevant Cut-Off Date, the payment of the firstinstalment due in respect of the relevant Loan Receivable was made by the relevant Borrower or, ifthe payment date for the first instalment did not fall prior to the relevant Cut-Off Date, the paymentof the first instalment was made before the relevant Transfer Date;

(vii) as of the relevant Transfer Date, no creditors of DB Mutui have commenced any JudicialProceedings and/or Enforcement Proceedings in respect of the Loan Receivables or RelatedSecurities;

(viii) since the date on and to which the financial information concerning DB Mutui most recentlydelivered to the Issuer was drawn up, there has been no material adverse change in the business,assets or financial condition of DB Mutui (and, to the best of the knowledge of DB Mutui, nor is anysuch change foreseen) which would adversely affect the ability of DB Mutui to perform fully itsobligations under the Master Transfer Agreement and the other Transaction Documents;

(ix) in the administration and management of the Loan Receivables, DB Mutui has fully complied withthe applicable rules concerning data protection and privacy protection, including, without limitation,with all the provisions of the Privacy Law and with all its implementing decrees and regulations;

(x) each Loan Receivable is denominated in euro;

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(xi) (A) none of the Loan Receivables falls within the definition of non-performing credit (credito insofferenza or credito incagliato) or restructured debt (credito ristrutturato) or is in the process ofbeing restructured (credito in corso di ristrutturazione) within the definition of the Bank of Italysupervisory regulations (including the Manuale per la compilazione della matrice dei conti) and (B)no Borrower was classified as defaulted (in sofferenza) in the Centrale dei Rischi for any other debtwhen DB Mutui granted the relevant Loan;

Related Securities

(xii) the obligations assumed by the relevant parties to each Loan Agreement and Related Securityconstitute legal, valid and binding obligations of each such Borrower and Guarantor enforceable inaccordance with the terms of the relevant instrument, deed or agreement and in accordance with anyapplicable law, regulation or order of any competent authority;

(xiii) each Loan Agreement and Related Security and, in each case, each other document relating thereto isgoverned by Italian law, is valid and effective and constitutes valid, legal and binding obligations ofeach party thereto enforceable in accordance with its terms and complies in all respects withapplicable Italian laws and regulations in force and any Related Security has been duly created and(when applicable) registered, renewed, preserved and perfected;

(xiv) each authorisation, approval, consent, licence, exemption, registration, recording, filing ornotarisation which is necessary to ensure:

(A) the validity, legality, enforceability or priority of the rights and obligations of the relevantparties to each Loan Agreement and Related Security, and

(B) the transfer and assignment by DB Mutui to the Issuer of the Pool

(other than those pertaining or relating to the Issuer), has been duly and unconditionally obtained ormade (with the exception of the publication of the required notice in the Italian Official Gazette ofthe Republic of Italy (Gazzetta Ufficiale) and the relevant deposit with the competent Companies’House (Registro delle Imprese);

(xv) each duty, tax or fee of any kind which was payable (dovuta) prior to the relevant Transfer Dateunder or in connection with the Loan Agreements or which was necessary to ensure the validity,legality, enforceability or priority of the rights and obligations of the relevant parties to each LoanAgreement and Related Security, has been duly paid;

(xvi) any other action which is necessary to ensure the validity, legality, enforceability or priority of therights and obligations of the relevant parties to each Loan Agreement and Related Security and thevalidity, legality and enforceability of the transfer and assignment by DB Mutui to the Issuer of theLoan Receivables (other than those pertaining or relating to the Issuer), has been duly obtained,made or taken;

(xvii) with respect to each Loan Agreement and Related Security, no Borrower or Guarantor is entitled toexercise any rights of rescission, counterclaim, set-off or defence to or in respect of the operation ofany of the terms of the relevant Loan Agreement, Related Security or any related agreement ordocument or in respect of any amount payable or repayable thereunder or to the Originator thatwould render the relevant Loan Agreement and Related Security unenforceable, in whole or in part,or subject to any right of rescission, counterclaim, set-off, defence or claw-back action (azionerevocatoria), and no such right of rescission, counterclaim, set-off or defence has been asserted orthreatened;

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(xviii) the origination, servicing and collection practices adopted by DB Mutui with respect to each LoanReceivable and Related Security up to the relevant Transfer Date have in all material respects beenconducted in accordance with all applicable laws and regulations, including, without limitation,applicable Bank of Italy supervisory regulations (Istruzioni di Vigilanza) and in a prudent anddiligent manner in accordance with the loan management policies adopted by DB Mutui from time totime, and in each case, the best banking practices of a prudent lender;

(xix) DB Mutui has maintained in all material respects complete, proper and up-to-date accounts, books,records and documents relating to the Loan Receivables and Related Securities and all amounts paidthereunder and all such books, records and documents are kept in DB Mutui’s possession or held toits order;

(xx) each Loan Agreement and Related Security was entered into in compliance with all applicable laws,rules and regulations including, without limitation, the provisions of Law no. 108 of 7 March 1996(as from time to time implemented or supplemented), Article 120 of the Italian Banking Act orArticle 1283 of the Italian Civil Code, and the creation of the related Related Securities, the grantingof the related Loan and DB Mutui’s rights in respect of, and title to, the related Loan Receivableswas at all relevant times in compliance with all applicable laws, rules and regulations including,without limitation, in each case, all laws, rules and regulations relating to consumer protection,credito fondiario (if applicable), personal data protection and disclosure (trasparenza);

(xxi) there are no conditions in any Loan Agreement or Related Security or in any other agreement ordocument pursuant to which DB Mutui is prevented from assigning the Loan Receivables andRelated Securities;

(xxii) no right has been conferred on the relevant Borrower other than the rights conferred upon therelevant Borrower by the relevant Loan Agreement or by operation of law;

(xxiii) no Borrower is permitted by law or pursuant to the terms of any Loan Agreement, at its option, todefer the timing of any payment under the relevant Loan beyond the contractually agreed paymentdate for each such amount specified in the relevant Loan Agreement or to alter the amount thereof.

Loans

each Loan, and each Loan Receivable arising therefrom, is secured by one or more Mortgages;

(xxiv) each Loan was granted to private individuals (persone fisiche) resident in Italy and, at the date therelevant Loan Agreement was entered into and at the date of this Agreement, none of the Borrowersfell and fall, respectively, in any category of individuals who might be subject to InsolvencyProceedings under the law, save for those Borrowers to whom a mortgage loan qualifying as mutuofondiario pursuant to Article 38 (and following) of the Italian Banking Act was granted, in respect ofwhich the 10 day period for consolidation of the relevant mortgage has elapsed; and (B) all Loansgranted by DB Mutui to Borrowers in order to purchase a Real Estate Asset from a vendor who wascapable of becoming subject to Insolvency Proceedings under applicable law qualify as mutuofondiario pursuant to Article 38 (and following) of the Italian Banking Act, and the relevant 10 dayperiod for consolidation of the relevant mortgage has elapsed;

(xxv) the execution of each of the Loan Agreements and the advance of each of the Loans thereunder havebeen made in compliance with all applicable laws, rules and regulations and the Loan Agreementsentered into by DB Mutui comply with the lending policies and procedures adopted from time totime by DB Mutui;

(xxvi) the Relevant List contains the complete list of all the Loan Receivables comprised in the Pool whichare transferred pursuant to this Master Transfer Agreement and the relevant Purchase Agreement (as

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the case may be); and all such Loan Receivables comply with and are capable of being identified asregards Articles 1, 2 and 4 of the Italian Securitisation Law on the basis of the relevant Criteria;

(xxvii) no Loan Receivable arising from or in respect of a Loan Agreement which complies with therelevant Criteria and which is capable of being identified as regards Articles 1, 2 and 4 of the ItalianSecuritisation Law shall fail to be transferred by DB Mutui pursuant to the relevant Master TransferAgreement and the relevant Purchase Agreement (as the case may be);

(xxviii) each Loan was granted by DB Mutui;

(xxix) each Loan has been fully disbursed to or to the account of the relevant Borrower and there is noobligation on the part of DB Mutui to advance or disburse further amounts in connection with it;

(xxx) no provision in any Loan Agreement (other than any provision which has been incorporated ordeemed to be incorporated in that Loan Agreement by, or pursuant to, any applicable, mandatoryprovision of law):

(xxxi) imposes any obligation on the Issuer other than the obligation (if any) to release or discharge therelevant Borrower and/or Guarantor from its obligations, or entitles any relevant Borrower orGuarantor to any cancellation release or reduction of the relevant Loan subject to payment in full bythe Borrower and/or Guarantor, of all amounts outstanding under such Loan Agreement save to theextent required by any applicable Italian law and/or regulations;

(a) imposes any obligation on DB Mutui the default of which will adversely affect the Issuer;

(b) adversely affects the ability of the Issuer, the Servicer, or any successor servicer appointed inrespect of the Loan Receivables, to collect and recover amounts in relation to the relevantLoan;

(c) would affect the decision by the Issuer to purchase the Loan Receivable relating thereto inthe context of the Securitisation; or

(d) is material for disclosure in the Prospectus in addition to the disclosure contained therein;

(e) DB Mutui has not relieved or discharged any Borrower or Guarantor, or subordinated itsrights to Loan Receivables to those of other creditors thereof, or waived any rights, except inrelation to payments made in a corresponding amount in satisfaction of the relevant LoanReceivables or when required by applicable law or in accordance with prudent bankingpractice in order to protect the position of DB Mutui as owner of the Loan Receivables; and

(xxxii) in granting each Loan, DB Mutui relied solely on the value of the Real Estate Asset over which therelevant Mortgage was created, the value of any Related Security and the standing of the relevantBorrower and in accordance with best banking practice;

(xxxiii) no Loans benefit from any state, governmental, regional or provincial subsidy;

(xxxiv) the amount granted by the Originator under the Loan did not exceed 100% of the appraised value(valore di perizia) of the relevant Real Estate Asset on the date of drawdown;

(xxxv) the Originator has neither given its consent to, nor executed, any assumption of debt (accolloliberatorio) by any third party in respect of any Loan Receivable; and

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(xxxvi) The 3 months Euribor rate of the variable rate Loans comprised in the Portfolio is reset every threemonths on the last calendar day of January, April, July and October subject to the ModifiedFollowing Business Day Convention.

Mortgages

(xxxvii) each Loan Agreement was executed as a public deed (atto pubblico), drafted by and executed beforea public notary or by way of private deed authenticated by a public notary (scrittura privataautenticata);

(xxxviii) there are no outstanding registrations, transcriptions or annotations (iscrizioni, trascrizioni oannotazioni) which may be prejudicial to the legality, validity or enforceability of any Mortgage orwhich may render any Mortgage not an economically first ranking priority mortgage (ipoteca diprimo grado economico);

(xxxix) at the time of the execution of each Loan Agreement and Related Security each Borrower andGuarantor (as the case may be) was for the purposes of Italian law (including tax purposes) residentin the Republic of Italy;

(xl) in respect of each Mortgage or other Related Security, DB Mutui has not cancelled, released orreduced or agreed to the cancellation, release or reduction (whether in whole or in part) of anyMortgage (if any) or other Related Security and it has not relieved any Borrower or Guarantor fromany obligation thereunder, or subordinated any of its rights thereunder to claims of any other creditorof the Borrower or Guarantor, as the case may be, except to the extent required by applicable Italianlaws and regulations;

(xli) each Mortgage in the Relevant List secures amounts specified therein and the value of the relevantReal Estate Asset was at the time of valuation not lower than that indicated therein;

(xlii) each Mortgage (the Relevant Mortgage) is economically a first ranking priority mortgage (ipoteca diprimo grado economico), that is:

(a) a first ranking priority mortgage (ipoteca di primo grado legale); or

(b) a subsequent ranking priority mortgage (ipoteca di grado legale successivo) where theobligations secured by the mortgage(s) ranking in priority thereto (the Higher RankingMortgage(s)) have been fully satisfied; or

(c) a subsequent ranking priority mortgage (ipoteca di grado legale successivo) where (i) eachof the Higher Ranking Mortgage was granted and is recorded exclusively in favour of theOriginator, and (ii) the obligations secured by each of the Higher Ranking Mortgage(s) relateexclusively to a different Loan Receivable transferred by the Originator to the Issuer theMaster Transfer Agreement PROVIDED THAT (as of the date of drawdown of the Loanrelating to such Loan Receivable, the Relevant Date) the sum of (1) the principal outstandingamount of the Loan Receivable secured by the Higher Ranking Mortgages and (2) theprincipal amount of the Loan Receivable secured by the lowest ranking Mortgage did notexceed 100% of the appraised value (valore di perizia) of the relevant Real Estate Asset asof the Relevant Date;

(xliii) the Mortgages do not secure any loan other than the Loans and there are no other Security Interestsin relation to the Real Estate Assets which rank pari passu with the Mortgages;

(xliv) each Borrower or Guarantor who has granted a Mortgage is the owner of the relevant Real EstateAsset.

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Real Estate Assets

(xlv) up to and including the relevant Transfer Date, no claims have been made for adverse possession(including usucapione) against any of the Real Estate Assets nor has an Adverse Claim been madenor are there any prejudicial registrations or annotations (iscrizioni o trascrizioni pregiudizievoli) inrespect of any Real Estate Asset which may affect or impair in any manner whatsoever theenforceability of the relevant Mortgage and its respective ranking (grado);

(xlvi) as at the relevant Transfer Date, there are no proceedings, actual or, to the best of DB Mutui’sknowledge, threatened, in respect of the infringement of planning and regulatory laws or regulationsapplicable to any Real Estate Asset (other than infringement that is de minimis). For the purposes ofthis Paragraph (xlvi) and Paragraph (xlvii) below, de minimis means that the effects of suchinfringements, damage or waste or failure or non compliance could not materially adversely affectthe value of the relevant Real Estate Asset or have an adverse effect on the recoverability of therelevant Loan Receivable or the enforceability of the related Mortgage;

(xlvii) as at the relevant Transfer Date, each Real Estate Asset is free from damage and waste and is in goodcondition when compared to those taken into account in the appraisal (perizia) carried out for thegranting of the relevant Loan (other than damage or waste or failure to be in good condition that isde minimis);

(xlviii) on the date of drawdown of the relevant Loan, each Real Estate Asset complied with all applicableItalian laws as to its use (destinazione d’uso) as a residential property or a commercial property (asthe case may be); the principal amount outstanding of the Loan Receivables secured on commercialproperties comprised in the Initial Pool is approximately 2.02% of the principal amount outstandingof the Initial Pool;

(xlix) each Real Estate Asset is located in Italy;

(l) all data and information supplied or made available by DB Mutui to the Issuer or its respectiveaffiliates, employees representatives, agents, advisers and/or consultants in respect of each RealEstate Asset and related Mortgage is true, correct, complete and accurate in all material respects andhas been prepared or calculated on a reasonable and objective basis;

(li) all the Real Estate Assets have been appraised (periziati) by an appraisee being an externalconsultant in accordance with the standards of the best market practice in Italy;

(lii) the documentation relating to each Loan contains an appraisal of the Real Estate Asset over whichthe relevant Loan is secured, made and signed prior to the approval of the relevant Loan Agreement,by a qualified appraiser being a consultant of DB Mutui who, to the best of the knowledge and beliefof DB Mutui, having made all enquiries that would usually be made by a bank acting prudently, atall relevant times had no interest, direct or indirect, in the relevant Real Estate Asset or related Loan,as the case may be; the remuneration of such appraiser was not related to or in any way connectedwith the approval of the relevant Loan or the granting of the Mortgage and each such appraiser hasduly and consistently applied the Guidelines to the appraisal of the value of each Real Estate Asset ithas appraised (for the purposes of this Paragraph (liii), Guidelines means the rules and guidelines forthe time being set by DB Mutui (as the case may be) governing the valuation and appraisal of RealEstate Assets);

(liii) at the time of advance of the Loans and perfection of the Mortgages, the relevant Real Estate Assetswere duly registered with the competent land offices and registration offices (Conservatoria deiRegistri Immobiliari and Ufficio del Catasto Urbano e dei Terreni) or a valid application or petitionhas been presented officially to register them, in compliance with all applicable laws and regulations;

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(liv) each of the Real Estate Assets which constitutes a commercial property and on which a Mortgagewas granted in favour of the Originator is occupied by the relevant Borrower and no such Real EstateAsset is subject to any tenant or similar agreement with any third party.

Insurance Policies

(lv) each Insurance Policy is in full force and effect and all premia have been paid in full on the due datefor payment;

(lvi) all insurance premia relating to the Insurance Policies are to be and have been paid upfront;

(lvii) each Insurance Policy is governed by Italian law;

(lviii) under each of the Insurance Policies, DB Mutui is entitled to require the relevant InsuranceCompany under the relevant Insurance Policy to make any payment under such Insurance Policydirectly to DB Mutui or its assignees and not to the relevant Borrower and DB Mutui’s interest andrights in or under such Insurance Policy can be assigned to the Issuer in the manner contemplated inthe Transaction Documents and the validity of each such Insurance Policy shall not be affectedthereby;

(lix) in accordance with the Master Transfer Agreement the benefit of the Insurance Policies will bevalidly transferred to the Issuer and the Issuer will become the sole beneficiary under the InsurancePolicies and such transfer will be valid and enforceable against DB Mutui or any other person;

(lx) each Insurance Policy covers at least the risk of fire, explosion and lightning strike damage for anamount equal to at least the amount of the Loan;

Additional Pool Requirements

(lxi) all the Loans Receivables comprised in each Pool comply with the Additional Pool Requirements.

“Regulatory Delinquent Loan Receivable” means a Loan Receivable classified by the Originator pursuantto the Bank of Italy Instructions as delinquent (ad incaglio) or under which there are 7 (seven) overduemonthly instalments, whether such instalments are consecutive or not.

Consequences of breach of representations and warranties by the Originator

Indemnity: The Originator has agreed to indemnify and hold harmless the Issuer in respect of all damages,losses, claims, costs and expenses suffered by the Issuer resulting from:

(a) any representation and/or warranty given by it under the Master Transfer Agreement to which it is aparty being, in whole or in part, untrue, incorrect, incomplete or inaccurate;

(b) a default by the Originator to perform its obligations under the Master Transfer Agreement;

(c) any amount of any Loan Receivable comprised in the Portfolio not being collected or recovered orrecoverable as a consequence of:

(i) the proper and legal exercise by any Obligor of any right of counterclaim or set-off againstthe Originator in respect of an Loan Receivable transferred by the Originator to the Issuer;

(ii) the application of any of the provisions set forth in Articles 1283 and 1343 to 1345 of theItalian Civil Code, as well as in Law No. 108 of 7 March 1996; or

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(iii) any Real Estate Asset failing to comply, as at the Transfer Date, with any applicable law(including any environmental law) or the absence as at the Transfer Date of any permit,licence and/or authorisation required by the law then applicable in relation to the Real EstateAssets and their use provided that such non compliance and/or absence causes (i) therelevant Real Estate Assets not to be eligible for sale in the context of a foreclosureproceeding or otherwise or (ii) the value of the relevant Real Estate Assets being materiallyaffected.

Limited Recourse Loan: Without prejudice to any other right arising in favour of the Issuer including anyindemnity as set out above, in the case of (i) a breach of any of the representations and warranties set outabove and insofar as such circumstance is capable of negatively affecting to a material extent the amount(consistenza) and/or the value (valore, anche di realizzo), of one or more of the relevant Loan Receivablescomprised in the Portfolio transferred by the Originator to the Issuer (the Loan Receivables in Breach) or ofthe relevant Mortgage, or (ii), in respect of a Loan Receivable comprised in the Portfolio, one of thefollowing circumstances occurs (an Affected Loan Receivables):

(a) a claw back action has been taken in respect of the relevant Mortgage Loan; or

(b) the relevant Mortgage Loan is proven (i) not to be an economically first ranking mortgage as set outin the Master Transfer Agreement, or (ii) to be granted in respect of receivables other than therelevant assigned Loan Receivable; or (iii) to rank pari passu with other mortgages registered overthe relevant Real Estate Asset; or

(c) the relevant Real Estate Asset is proven not to have been compliant with any applicable planning andbuilding laws and regulations (legislazione edilizia, urbanistica e vincolistica) or any otherapplicable laws, rules and regulations including, but not limited to, those relating to health andsafety, fire prevention, maintenance of equipment and environmental protection, unless suchirregularity has been remedied or an amnesty with reference to such irregularity has been dulyobtained; or

(d) the relevant Obligor is proven not to have full and exclusive title to the relevant Real Estate Asset;

then the Originator, upon the Issuer’s request, and within 5 (five) Italian Business Days of receipt of suchrequest, shall procure a limited recourse loan to the Issuer (a Limited Recourse Loan). The LimitedRecourse Loan to be granted to the Issuer shall be credited to the Issuer Collection Account, and shall beequal to the Individual Purchase Price of the relevant Loan Receivable in Breach or Affected LoanReceivable (as the case may be):

plus

(i) interest on such amount equal to the aggregate of:

(A) the weighted average of the interest rates paid and payable on the Notes in respect ofthe interest periods from the Issue Date to (and including):

(I) the period during the Initial Period in which the payment of the amounts due under thisclause is paid (such interest rate to be applied for the period from and including the IssueDate to and excluding the First Amortisation Payment Date); or

(II) the Payment Date immediately following the date on which the amounts due hereunder arepaid, if the payment is made by DB Mutui following the Initial Period (such interest rate tobe applied for the period from and including the Issue Date to and excluding the PaymentDate immediately following the date on which the amounts due hereunder are paid),

in each case calculated on a yearly basis (actual/360); and

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(B) the Additional Rate, calculated on a yearly basis (actual/360) and accruing from the Issue Dateuntil the First Amortisation Payment Date or the Payment Date immediately following the dateon which the amounts due hereunder are paid;

plus

(ii) an amount equal to the relevant Senior Expenses Proportion;

plus

(iii) an amount equal to the sums actually collected and retained by the Issuer in relation to suchLoan Receivable in Breach or Affected Loan Receivable (including any amount previouslypaid as indemnity by DB Mutui in accordance with terms of the Master Transfer Agreement,to the extent such amount is allocated to payment of principal amount outstanding of suchLoan Receivable in Breach or Affected Loan Receivable);

plus

(iv) interest accrued on the amounts set out in sub-paragraph (iii) above at a rate equal to theweighted average of the interest rates applied to the Issuer’s bank accounts where theamounts set out in sub-paragraph (iii) were credited up to the date the relevant request ismade,

(the amount resulting from the above calculations being referred to as the Limited Recourse LoanAmount) provided that an amount equal to the interest which will accrue for the benefit of the Issueron the amounts paid by DB Mutui (as calculated in accordance with items (i) to (iv) above) as fromthe date of the advance of the relevant Limited Recourse Loan up to the First Amortisation PaymentDate or the Payment Date immediately following the date on which the amounts due hereunder arepaid, as the case may be, shall be repaid to DB Mutui in accordance with the Priority of Payments.

Pursuant to the Master Transfer Agreement, the Issuer shall be no longer entitled to make a further claim forindemnity under the terms set out in paragraph set above headed Indemnity, in respect of a Loan Receivablein Breach and an Affected Loan Receivable for which DB Mutui has granted a Limited Recourse Loan underthe terms set above. The Limited Recourse Loan shall be a non-interest bearing limited recourse loan(finanziamento non produttivo di interessi a ricorso limitato) and shall be repaid solely out of the amountseffectively collected or otherwise recovered by the Issuer in relation to the relevant Loan Receivable inbreach or Affected Loan Receivable (including any amount deriving from the sale of such Loan Receivable),provided that, partially departing from the priority of payments of the Notes, any such amount so collectedshall be firstly applied towards repayment of the relevant Limited Recourse Loan and, subsequently, towardssatisfaction of any other payment obligations of the Issuer in compliance with the priority of payments of theNotes.

Undertakings from Originator

The Master Transfer Agreement also contains a number of undertakings from Originator, in respect of itsactivities relating to the Loan Receivables comprised in the Portfolio, including, inter alia, an undertaking (i)not to assign and/or transfer any of the Loan Receivables, the Mortgages and/or the other Related Securitiesand any related or ancillary right to any third parties; (ii) not to create any security interest, charge, lien, orencumbrance or other right in favour of any third parties on any of the Loan Receivables and the Mortgagesand/or the other Related Securities comprised in the Portfolio; (iii) nor to instruct any Borrower or Guarantorof the Loan Receivables to make any payment with respect to any of them unless according to the specificinstructions of the Issuer and/or of the Servicer; and (iv) nor to take any action reasonably likely to cause anyof the Loan Receivables, the Mortgages and/or the other Related Securities to become invalid or diminish orhowsoever negatively affect their respective rights.

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Governing law, dispute resolution, language

The Master Transfer Agreement is governed by, and will be construed in accordance with, Italian law.

Any disputes arising in respect of the Master Transfer Agreement shall be referred to arbitration under theNational Arbitration Rules of the National and International Arbitration Chamber of Milan. The place ofarbitration shall be Milan.

The Master Transfer Agreement is in the English language.

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SERVICING OF THE PORTFOLIO

The following section relating to the servicing of the Portfolio contains a summary of certain provisionscontained in the Servicing Agreement and is qualified by reference to the detailed provisions of the termsand conditions of the Servicing Agreement. Unless otherwise set out herein, capitalised terms shall havethe meaning assigned to them in the Glossary of Terms.

THE SERVICING AGREEMENT

Under the Servicing Agreement entered into on 12 December 2007, as amended on 20 December 2007, theIssuer has appointed DB Mutui as Servicer.

The Servicer will be the “soggetto incaricato della riscossione dei crediti ceduti dei servizi di cassa e dipagamento” pursuant to the Italian Securitisation Law and the Implementing Regulations.

Under the Servicing Agreement, the Servicer has been entrusted with duties of, and conferred the powers forthe management and collection of, and the carrying out of cash and payment services with respect to theLoan Receivables comprised in the Portfolio pursuant to Article 2, paragraph 3, letter (c), and paragraph 6 ofthe Italian Securitisation Law, the Implementing Regulations, the Collection Policy and the terms andconditions of the Servicing Agreement.

The Servicer’s duties include the following:

(a) to collect all amounts to be paid by the Borrowers in relation to the Loan Receivables comprised inthe Portfolio and to transfer all amounts in relation to the collection of the Loan Receivablescomprised in the Portfolio and all amounts payable by the Servicer under the Servicing Agreement tothe Issuer;

(b) to do all things necessary for the collection and possible recovery of all the Loan Receivables and/orthe Defaulted Loan Receivables, including exercising all remedies found in the law and the LoanAgreements, including the enforcement of any Mortgage and/or Related Securities with the level ofcare and diligence it would employ if the Loan Receivables and /or the Defaulted Loan Receivableswere its own property;

(c) to conduct monitoring activities in relation to the Portfolio and the Securitisation and to administer,preserve and enforce all rights of the Issuer generally in relation to the Portfolio (including theDefaulted Loan Receivables), according to the Collection Policy;

(d) if the Loan Receivables comprised in the Portfolio become Defaulted Loan Receivables, to initiate,prosecute and manage, in accordance with the terms of the Servicing Agreement, all ForeclosureProceedings, Enforcement Proceedings and Insolvency Proceedings, on behalf and, if necessary, inthe name of the Issuer;

(e) to prepare and deliver all notices, communications and documents to be sent by the Issuer, in itscapacity as owner of the Loan Receivables, to the relevant Borrower and/or the guarantors in respectthereof;

(f) to report to the Issuer and the Representative of the Noteholders on a quarterly basis (as applicable);

(g) to effect, on behalf of the Issuer the reporting provided for by the Bank of Italy’s AutomatedInterbank Risk Service (“Centrale dei Rischi”), the Bank of Italy’s supervisory system applicable to

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financial intermediaries enrolled in the register provided for by Article 107 of the Italian BankingAct (“Segnalazioni di Vigilanza”) and to the Central Record of Accounts (“Matrice dei Conti”), ineach case pursuant to the relevant laws and regulations;

(h) to create and maintain the electronic data storage system provided for by Italian anti-moneylaundering law and regulations (“Archivio Unico Informatico”), if and to the extent applicable andcollect all data and information requested in order to enable the Issuer to comply with Italian anti-money laundering law and regulations (including Italian Law n. 197 of 5 July 1991), to send allnotices and fulfil all obligations provided for by such regulation including the opinion issued by the“Ufficio Italiano dei Cambi” on 5 July 2000;

(i) to perform all other servicing activities and functions (within the meaning given to such expressionunder the Italian Securitisation Law and the Implementing Regulations) relating to the Securitisationand not specified herein, which must be performed by the Servicer pursuant to the terms of theItalian Securitisation Law and the Implementing Regulations;

(j) to perform all its duties under the Servicing Agreement with diligence and in accordance with allapplicable laws and regulations, including the Italian Securitisation Law, the Collection Policy andpursuant to specific instructions that, on certain conditions, may be given to it by the Issuer and/or bythe Representative of the Noteholders; and

(j) to provide the Issuer, the Calculation Agent and the Cash Manager with the Servicer Report as setout in the Servicing Agreement.

(all the tasks as set out above being collectively referred to as the Services).

SUB-CONTRACTS

The Servicer may appoint any third parties of its choice in order to carry out all or any administrative part ofits activities hereunder (other than the monitoring functions set out in Article 2, paragraph (6) of the ItalianSecuritisation Law and such other duties which can not be delegated to third parties pursuant to theImplementing Regulations, if any), provided that:

(a) notwithstanding any provisions to the contrary (including, in the contractual arrangements betweenthe Servicer and the appointed third parties), the appointment of such third parties shall not in anyway exempt the Servicer from its obligations under the Servicing Agreement, for which it shallcontinue to be solely liable, pursuant to Article 1228 of the Italian Civil Code, as if no suchappointment had been made, also by way of express derogation of article 1717, paragraph 2, of theItalian Civil Code;

(b) the Issuer shall have no liability to the appointed third parties whatsoever in relation to any cost,claim, charge, damage or expense suffered or incurred by such third parties;

(c) the appointment of any such third party shall be subject to such third party undertaking to perform allthe obligations of the Servicer under the activities delegated hereunder;

(d) each appointment of any such third party shall be subject to the prior written consent of the Issuerand the Representative of the Noteholders (save when the appointment is made in compliance withthe Collection Policy or is legally required, in which case the Servicer shall however notify suchappointment to the Issuer and the Representative of the Noteholders); and

(e) the appointment of any such third party will not have any material adverse effect on the interests ofthe Noteholders

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SPECIAL SERVICER

The Issuer and the Representative of the Noteholders agreed that, with a view to maximising the recovery ofthe Defaulted Loan Receivables, the Servicer shall be entitled to appoint at its discretion, in the name and onbehalf of the Issuer, any third party with considerable experience in the non-performing loans market andhaving all the legal requirements provided by applicable laws, to carry out in the interest of the Issuer therecovery activities in respect of the Portfolio under the terms of this Agreement (the Special Servicer).

The Issuer and the Representative of the Noteholders agree that as a consideration for its recovery activities,the Special Servicer shall be entitled to receive from the Issuer a fee calculated on the basis of the aggregatenet recovered amount under the Portfolio, in an amount to be agreed by the Issuer, the Servicer, the SpecialServicer and the Representative of the Noteholders. The Parties expressly acknowledge that the appointmentof the Special Servicer shall be subject to the condition that the Special Servicer has accepted the terms andhas become a party to the Intercreditor Agreement and the other Transaction Documents (where appropriate).The Parties shall promptly notify the Rating Agencies of the appointment of the Special Servicer and its fees.

BACK-UP SERVICER

The Servicer has undertaken to appoint promptly, and in any event by no later than 15 (fifteen) BusinessDays from the date of occurrence of any of the Back-Up Servicer Appointment Events (as definedbelow)(and in the event of its failure, the Representative of the Noteholders shall do so on its behalf), anentity having the necessary requirements as servicer (the “Back-Up Servicer”), by entering into a back-upservicer commitment letter in form and substance reasonable acceptable to the Representative of theNoteholders.

For the purpose of the Servicing Agreement, Back-Up Servicer Appointment Event means the occurrenceof any of the following events:

Maintenance of ownership: the Servicer ceases at any time to be a direct or indirect subsidiary ofDeutsche Bank AG;

Downgrading: Deutsche Bank AG ceases at any time to be rated at least A-1 by S&P or “A1” or “P-1” by Moody’s.

AUDITING

The Servicer shall procure (at the Issuer’s costs and expenses), a primary international auditing firm, whichis acceptable to the Issuer and the Representative of the Noteholders (the Auditing Firm) to carry out thefollowing auditing procedure:

(a) to review one of the Servicer Report provided by the Servicer in the last calendar year as selected bythe Auditing Firm at its sole discretion, in order to verify that its content complies with theaccounting records kept by the Servicer hereunder;

(b) to review, on a sample basis, the procedures applied by the Servicer for the calculation ofcommissions, expenditure, reimbursement and other in / outflows, on the basis of the provisions setout in the Transaction Documents; and

(c) to review, on a sample basis, the reconciliation of the Servicer’s account balances with the balancesrecorded by the Issuer.

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TERMINATION OF THE APPOINTMENT OF THE SERVICER

The Issuer will have the right to terminate the Servicer’s appointment and appoint a successor servicer, underthe terms and subject to the conditions set out in the Servicing Agreement, if any of the following eventstakes place (each a Servicer Termination Event):

1. Insolvency:

(a) a shareholders’ meeting of the Servicer is convened to take any corporate action to begin aninsolvency or similar proceeding;

(b) a petition or application for the admission of the Servicer into an Insolvency Proceeding is filed,unless is dismissed or discharged within 60 days.

2. Winding up and similar proceedings: an order is made or an effective resolution is passed for thewinding up, liquidation, dissolution or extraordinary administration in any form of any of the Servicer or theservicer becomes subject to any of the proceedings referred to in Title IV of the Italian Banking Act.

3. Breach of obligations: the Servicer fails to observe or perform any of its obligations under theServicing Agreement, unless (if capable of remedy) such failure is remedied by the Servicer on the earlier of:

(a) the 10th Business Day from the day on which the Servicer received the first written request forperformance by either the Issuer or the Representative of the Noteholders; and

(b) the 10th Business Day from the day on which the Servicer became aware of such failure.

4. Breach of representations and warranties: any of the representations and warranties given by theServicer under the Servicing Agreement is or proves to have been incorrect or misleading in any materialrespect when made or deemed to be made or repeated, to the extent any such breach is prejudicial to theinterests of the Noteholders based on the reasonable opinion of the Representative of the Noteholders.

5. Regulatory breach: the Servicer fails to:

(a) maintain all authorisation, approvals, consents and registrations necessary in order to carry out itsactivities hereunder; or

(b) comply with any applicable obligations, requirements, instructions or guidelines provided for by theBank of Italy and any other authorities supervising the Servicer.

6. Material Adverse Change: any event or series of events (whether related or not) occurs which inthe reasonable opinion of the Representative of the Noteholders will have a material adverse effect on (a) theability of the Servicer to perform its obligations under the Servicing Agreement; or (b) the validity orenforceability of the Servicing Agreement;

7. Invalidity: any material provision of the Servicing Agreement is or becomes, for any reason, invalidor unenforceable and the Issuer and/or the Representative of the Noteholders would be prejudiced by suchprovision being or becoming invalid or unenforceable.

8. Failure to transfer: failure by the Servicer to transfer, deposit or pay any amount to be transferred,deposited or paid hereunder within 3 (three) Business Days of the due date for transfer, deposit or payment.

9. Servicer Report: the Servicer fails to deliver a Servicer Report by the due date for delivery thereofunless in each case such failure is not remedied within the following 3 (three) Business Days (or if it is

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caused by administrative difficulties not imputable to the Servicer, it is not remedied within the following 6(six) Business Days).

10. Auditing reports: any auditing report delivered by the Auditing Firm under the ServicingAgreement contains any reservations which is materially prejudicial to the interests of the Issuer under theServicing Agreement, or the Issuer is not provided with any of the audit report within 15 (fifteen) BusinessDays from the foreseen due date, for a fact attributable to negligence (colpa) or wilful misconduct (dolo) bythe Servicer.

Upon any termination of the appointment of the Servicer becoming effective, the Servicer will be required,inter alia, to make available, at its own expense, to (i) the Issuer, (ii) the Representative of the Noteholders,and (iii) the successor servicer, any documentation and records relating to the Servicer’s activities. Inaddition, the Servicer will be required to immediately credit to the Issuer Collection Account (or suchdifferent account as the Issuer may direct), the Collections as well as any other amount received by theServicer in respect of the Loan Receivables comprised in the Portfolio and not credited to the IssuerCollection Account.

In addition, each of the Servicers has agreed that, for a period of six months from the date any termination ofits appointment becomes effective, it will take all steps necessary in order to assist and enable the successorservicer (in the case of the termination of the Servicer) to perform its duties as servicer pursuant to theServicing Agreement.

SERVICING FEES

The Servicer has agreed that the obligations of the Issuer under the Servicing Agreement are subordinatedand limited recourse obligations and will be payable only out of the Available Funds in accordance with thepriority of payments set out in the Intercreditor Agreement and the Conditions.

In consideration of the services to be provided by the Servicer, the Issuer will pay (in arrear) the followingfees:

(a) a management fee equal to 0.10% p.a. of the principal amount outstanding of the Portfolio (yet to berepaid) on any Calculation Date;

(b) a collection fee equal to 0.10% p.a. of the principal amount outstanding of the Portfolio (yet to berepaid) on any Calculation Date plus a collection fee equal to 5 Euro for each Instalment if and to theextent already collected from the Borrower; and

(c) a recovery fee equal to 0.01% of the aggregate net recovered amount (deducting any cost andexpense related to the enforcement activities).

GOVERNING LAW, DISPUTES, LANGUAGE

The Servicing Agreement is governed by, and will be construed in accordance with, Italian law.

Any disputes arising in respect of the Servicing Agreement shall be referred to arbitration under the NationalArbitration Rules of the National and International Arbitration Chamber of Milan.

The Servicing Agreement is in the English language.

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SUMMARY OF THE TRANSACTION DOCUMENTS

The summary of the Transaction Documents set out below is a summary of certain features of thoseagreements and is qualified by reference to the detailed provisions of those agreements.

The summary of the Transaction Documents set out below is a summary of certain features of thoseagreements and is qualified by reference to the detailed provisions of those agreements. Unless otherwise setout herein, capitalised terms shall have the meaning assigned to them in the Glossary of Terms.

A. Cash Management Agreement

Pursuant to the Cash Management Agreement entered into on or prior to the Issue Date between the Issuer,the Account Banks, the Cash Manager, the Calculation Agent and the Representative of the Noteholders,inter alia:

(a) the Transaction Account Bank has agreed to hold and operate the Issuer English Accounts and toprovide the Issuer with account handling services in relation to the amounts from time to timestanding to the credit of such accounts;

(b) the Italian Account Bank has agreed to hold and operate the Issuer Italian Accounts and to providethe Issuer with account handling services in relation to the amounts from time to time standing to thecredit of such accounts;

(c) the Cash Manager has agreed to manage and administer all amounts of cash standing to the credit ofthe Issuer Accounts;

(d) the Calculation Agent has agreed to (i) provide certain calculation, notification and reportingservices to the Issuer, including the calculation of the interest payable on the Notes; and (ii) toprepare the Quarterly Investors Report and deliver it to, inter alios, the Issuer, the Representative ofthe Noteholders and the Paying Agents.

In consideration for the services so provided, each of the Account Bank, the Cash Manager and theCalculation Agent will receive a fee, as separately agreed between each of them and the Issuer, payable inarrears on each Payment Date.

The Issuer may terminate the appointment of the Transaction Account Bank, the Italian Account Bank, theCash Manager or the Calculation Agent following the occurrence of any of the termination events specifiedin the Cash Management Agreement. Any of the Account Banks, the Cash Manager or the Calculation Agentmay resign on giving 90 days’ written notice to the Issuer in accordance with the Cash ManagementAgreement and the Issuer may at any time terminate the appointment of any of the Account Banks, theCalculation Agent or the Cash Manager by giving to such agent or bank (as the case may be) and theRepresentative of the Noteholders not less than 90 days’ written notice to that effect in accordance with theCash Management Agreement.

Upon the resignation by or termination of the appointment of any of the Account Banks, the CalculationAgent or the Cash Manager, the Issuer will, with the prior written consent of the Representative of theNoteholders, immediately appoint a new transaction account bank, calculation agent, Italian account bank orcash manager (as the case may be) provided that no resignation or termination of the appointment of theTransaction Account Bank, the Calculation Agent, the Italian Account Bank or the Cash Manager shall takeeffect until a new Transaction Account Bank, Calculation Agent, Italian Account Bank or Cash Manager, asthe case may be, has been appointed and has agreed to be bound by the provisions of the IntercreditorAgreement, has accepted the pledge created pursuant to the Pledge Agreement and has entered into anagreement on the same terms mutatis mutandis as the Cash Management Agreement or on such other termsas the Representative of the Noteholders may approve.

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Issuer Accounts

From the Issue Date the Issuer is required at all times to maintain the following accounts in its name with theTransaction Account Bank:

(a) the Investment Account;

(b) the Securities Account;

(c) the Cash Reserve Account; and

(d) the Class E Notes Principal Accumulation Account.

In addition, the Issuer shall at all times maintain the following accounts with the Italian Account Bank:

(a) the Issuer Collection Account;

(b) the Principal Reserve Account;

(c) the Payments Account;

(d) the Expenses Account; and

(e) the Equity Capital Account,

provided that, subject to the provisions of the Cash Management Agreement, (i) the Principal ReserveAccount and the Class E Notes Principal Accumulation Account shall be closed following the Initial Periodand, respectively, amounts previously credited to the Principal Reserve Account shall be credited to theInvestment Account, and amounts previously credited to the Class E Notes Principal Accumulation Accountshall be applied in repayment of principal of the Class E Notes in accordance with the Pre-EnforcementPrincipal Priority of Payments, and (ii) the Cash Reserve Account shall be closed once the Rated Notes arerepaid in full or otherwise cancelled in accordance with the Conditions.

Pursuant to the Liquidity Facility Agreement, if a Standby Drawing is made under the terms set out therein,the Issuer will open the Liquidity Reserve Account on which such Standby Drawing will be credited.

Interest will accrue on a quarterly basis on the first calendar day of January, April, July and October of eachyear on the balance from time to time held to the credit of each of the Issuer Accounts (with the exception ofthe Securities Account) at the rate agreed between the Issuer and each Account Bank (as the case may be), asindicated in a separate letter, by crediting the relevant Issuer Account with the amount thereof on and forvalue on the second Business Day prior to the Calculation Date succeeding the Calculation Period duringwhich the interest accrued.

Each of the Account Bank shall waive any set-off, retention and other rights in respect of the relevant IssuerAccounts held by them.

Under the Cash Management Agreement, if at any time the Italian Account Bank or the Transaction AccountBank ceases to be an Eligible Institution, the Italian Account Bank and the Transaction Account Bank (as thecase may be) shall, within 2 (two) days of becoming aware of such circumstance, give notice of such event tothe Issuer and the Representative of the Noteholders, and the Issuer together with the Italian Account Bankand/or the Transaction Account Bank (as the case may be) and at the Italian Account Bank and/or theTransaction Account Bank, without prejudice to any provision or remedy contained in any TransactionDocument, shall, if required by the Rating Agencies within 30 (thirty) calendar days:

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(i) arrange for a guarantee, meeting the specific requirements requested by S&P, provided by aninstitution which is an Eligible Institution or cash collateral or other collateral arrangement in eachcase subject to the confirmation by the Rating Agencies that the then current rating of the RatingNotes will not be negatively affected; or

(ii) procure the transfer of the relevant Issuer Account(s) to any other institution which is an EligibleInstitution, subject to establishing arrangements substantially similar to those contained in the CashManagement Agreement, and direct the relevant Obligors to pay the amounts received in respect ofthe Loan Receivables into the accounts opened with such institution.

The Cash Manager

Under the terms of the Cash Management Agreement, the Cash Manager will be appointed by the Issuer asits agent (mandatario con rappresentanza) and will undertake, inter alia, to perform several services andother ancillary duties as shall be specified in the Cash Management Agreement and in the other TransactionDocuments.

Calculation Agent and Payments Reports

Under the terms of the Cash Management Agreement, the Calculation Agent will be appointed by the Issueras its agent (mandatario con rappresentanza), and will undertake inter alia, to:

(a) prepare the Payments Report and make it available to the Issuer, the Transaction Account Bank, theItalian Account Bank, the Paying Agents, the Servicer, the Liquidity Provider, the Cash Manager,the Hedging Counterparty, the Representative of the Noteholders and Monte Titoli by theimmediately following Calculation Date, subject to the timely receipt by the Calculation Agent ofthe information listed in Schedule 1 to the Cash Management Agreement from the other parties tothe Italian Securitisation;

(b) maintain certain books and records on behalf of the Issuer; and

(c) provide certain other calculation services to the Issuer and the Representative of the Noteholders,including the calculation of the interest payable on the Notes, the calculation of the Put OptionQuorum and any other calculation in case of exercise of a Put Option in accordance withCondition 7(e) (Early Redemption at the option of the Put Option Noteholders) as specified underthe Cash Management Agreement and the other Transaction Documents.

The Payments Report will contain, inter alia, details of:

(a) the calculation of the Principal Amount Outstanding (before and after the succeeding Payment Date)under the Notes, the interest and the Variable Return due and payable on the succeeding PaymentDate;

(b) the Available Funds relating to the Collection Period immediately preceding the relevant CalculationDate;

(c) the Principal Available Funds;

(d) the Limited Recourse Loans and the Limited Recourse Loan Available Funds;

(e) the Cash Reserve Drawing Amount and the Cash Reserve Release Amount;

(f) any Facility Drawing to be made or outstanding pursuant to the Liquidity Facility Agreement;

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(g) the payments made during the preceding Collection Period and to its knowledge required to be paidin the succeeding Collection Period to Connected Third Party Creditors; and

(h) the occurrence of any Credit Trigger Event.

In the absence of the Calculation Agent notifying the Representative of the Noteholders and the AccountBanks of any errors in the Payments Report prior to the Payment Date, the Payments Report shall be treatedas constituting an instruction from the Issuer to the Account Banks and/or the Cash Manager and/or thePaying Agents to make the payments and transfers referred to therein.

The Cash Management Agreement is governed by Italian law.

B. Agency Agreement

Pursuant to the Agency Agreement entered into on or prior to the Issue Date between the Issuer, the PayingAgents and the Representative of the Noteholders, each of the Paying Agent has agreed, amongst otherthings, to provide certain agency and payment services to the Issuer in relation to the Notes. In particular, oneach Payment Date, each Paying Agent shall effect payments in accordance with the amounts set out in therelevant Payments Report prepared by the Calculation Agent pursuant to the Cash Management Agreement.

The Agency Agreement is governed by Italian law.

C. Intercreditor Agreement

On or prior to the Issue Date, the Issuer, the Representative of the Noteholders (for itself and in the name andon behalf of the Noteholders) and the Other Issuer Secured Creditors have entered into the IntercreditorAgreement pursuant to which the parties thereto have agreed on the cash flow allocation of the AvailableFunds and the other Transaction Documents and the Representative of the Noteholders have been grantedwith certain rights in relation to the Available Funds.

Representative of the Noteholders

Under the Intercreditor Agreement, the Issuer has appointed the Representative of the Noteholders as itsagent (mandatario con rappresentanza) to exercise, upon the service of an Issuer Enforcement Notice, in thename and on behalf of the Issuer and in the interest and for the benefit of the Noteholders and the OtherIssuer Secured Creditors, all and any of the Issuer’s rights deriving from each of the Transaction Documentsto which the Issuer is a party, including, inter alia, the right to give directions and instructions to the OtherIssuer Secured Creditors and to operate the Issuer Accounts.

The Intercreditor Agreement further provides that, upon the occurrence of a Specified Event, theRepresentative of the Noteholders will have the right to exercise, in the name and on behalf of the Issuer andin the interest and for the benefit of the Noteholders and the Other Issuer Secured Creditors, the rights of theIssuer under the Transaction Documents, and to exercise discretions, authorities or powers, to give thedirection or make the determination in respect of which the Specified Event has occurred.

Priority of Payments and Subordination

Prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event,Available Funds will be applied in accordance with the Pre-Enforcement Interest Priority of Payments as setout in Condition 5.1 and Pre-Enforcement Principal Priority of Payments set out in Condition 5.2. Followingthe service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, theEnforcement Priority of Payments set out in Condition 5.4 will apply.

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No other Enforcement Rights

Pursuant to the Intercreditor Agreement, all of the Other Issuer Secured Creditors will appoint theRepresentative of the Noteholders as their agent (mandatario con rappresentanza), so that the Representativeof the Noteholders has, in their name and behalf and also in the interests of and for the benefit of theNoteholders (who made a similar appointment pursuant to the Subscription Agreements and the Conditions),inter alia, entered into the Pledge Agreement and the Deed of Charge and, with effect from the date when theNotes have become due and payable following an Issuer Enforcement Notice being served on the Issuer,exercise all of the Issuer Secured Creditor’s right, title and interest in and to and in respect of the assetscharged under the Pledge Agreement and the Deed of Charge and do any act, matter or thing which itconsiders necessary for the protection of the Issuer Secured Creditors’ rights under any of the TransactionDocuments including the power to receive from the Issuer any and all moneys payable by the Issuer to anyIssuer Secured Creditor and take legal proceedings against the Issuer.

Non-Petition and limited recourse

The Issuer Secured Creditors have agreed not to take or join in taking steps for the purpose of petitioning forthe liquidation, administration or winding-up of the Issuer or in connection with any reorganisation orarrangement or composition proceeding in respect of the Issuer, unless and until it is permitted to do so inaccordance with the Conditions and/or the Transaction Documents, and otherwise, not before the expiry ofone year and one day following the final redemption of the Notes under the Securitisation and of any FurtherNote issued by the Issuer under any Further Securitisation.

The Intercreditor Agreement contains provisions regarding conflicts of interest between the Noteholders andthe Other Issuer Secured Creditors. In the exercise of its powers, authorities, duties and discretions theRepresentative of the Noteholders shall have regard to the Noteholders generally and shall also have regardto the interests of the Other Issuer Secured Creditors and, if there is a conflict between the interests of any ofthe Other Issuer Secured Creditors or if there is a conflict between the interests of any Noteholder and anyOther Issuer Secured Creditor, then it shall have regard only to the interests of the Issuer Secured Creditorthe amounts owed to which rank highest in the Enforcement Priority of Payments.

No Issuer Secured Creditor may exercise any right of set off (compensazione) against the Issuer under theNotes and/or the Transaction Documents or otherwise other than as may be expressly provided therein.

Each of the Noteholders and the Other Issuer Secured Creditors have agreed that none of them have any rightor entitlement to the Issuer’s assets other than such of the proceeds of the Issuer Security and the Portfolioand the other Securitisation Assets as are available to the Issuer for this purpose in accordance with theConditions and the Transaction Documents. In addition, each Noteholder and each Other Issuer SecuredCreditor has acknowledged that the limited recourse nature of the Notes produces the effect under Italian lawof a “contratto aleatorio” and has accepted the consequences thereof, including the consequences of Article1469 of the Italian Civil Code.

The Intercreditor Agreement contains provisions whereby if, following the service of an Issuer EnforcementNotice or the occurrence of an Issuer Insolvency Event and following the enforcement of the Issuer Securityand the exercise by the Representative of the Noteholders of its rights in respect of the Portfolio and anyasset or amount derived therefrom or, if no Issuer Enforcement Notice has been served or Issuer InsolvencyEvent occurred, on the relevant Maturity Date, the aggregate funds available to the Issuer to repay anyinterest and/or outstanding principal and any other amounts accrued and unpaid under the relevant Notes inaccordance with the relevant Priority of Payments are not sufficient to pay in full such amounts, then upondistribution of the available funds on the relevant Maturity Date, only a pro rata share of the funds which areavailable to the Issuer shall be applied in respect of such payment obligations in accordance with the relevantPriority of Payments and the unpaid balance of each such amount shall cease to be due and payable and shallbe cancelled in respect of the Notes of the relevant Class or Classes.

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The Intercreditor Agreement is governed by Italian law.

D. Pledge Agreement

The Issuer has granted in favour of the Noteholders and the Other Issuer Secured Creditors a pledge over allthe Issuer’s monetary rights (other than the Notes and payments thereunder) in, to and under the SubscriptionAgreements, the Master Transfer Agreement and each Purchase Agreement, the Servicing Agreement, theCash Management Agreement, the Agency Agreement, the Intercreditor Agreement, the Liquidity FacilityAgreement, the Corporate Services Agreement and the Quotaholder and Undertakings Agreement, as moreparticularly provided in the Pledge Agreement.

The Pledge Agreement is governed by, and construed in accordance with, Italian law. The Courts of Milanwill have exclusive jurisdiction in relation to any disputes arising in connection with the Pledge Agreement.The exercise of the rights under the Pledge Agreement shall be conditional upon the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event.

E. Deed of Charge

As further security for the Issuer’s obligations towards the Issuer Secured Creditors, under the terms of theDeed of Charge, the Issuer has created the following security interests in favour of the Representative of theNoteholders, on trust for the benefit of itself, the Noteholders and the Other Issuer Secured Creditors: (i) anassignment expressed to be by way of first fixed security of the Issuer English Assigned Agreements (asdefined therein) (if any); (ii) a charge expressed to be by way of first fixed charge over all of its rights, title,interest and benefit, present and future, in, to and under the Issuer English Accounts, together with all rightsrelating or attached thereto; and (iii) a first floating charge over the whole of its undertaking and all of itsproperty and assets whatsoever and wheresoever situated, present and future, other than any property orassets from time to time or for the time being effectively charged by way of fixed charge, or otherwiseassigned as security.

Pursuant to the Deed of Charge, the Representative of the Noteholders will, following the service of anIssuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, hold and exercise the IssuerSecured Creditors’ rights under the Deed of Charge for the account and benefit of the Issuer SecuredCreditors.

The Deed of Charge is governed by English law.

F. Corporate Services Agreement

Under the Corporate Services Agreement entered into on or about the Issue Date between the Issuer and theCorporate Servicer, the Corporate Servicer has agreed to provide certain corporate administration andmanagement services to the Issuer.

The Corporate Services Agreement is governed by Italian law.

G. Quotaholder and Undertakings Agreement

Under the Quotaholder and Undertakings Agreement entered into on or about the Issue Date between theIssuer, the Representative of the Noteholders and the Stichting, the Stichting (i) has assumed certainundertakings with respect to, inter alia, the exercise of their voting rights in the Issuer, and (ii) hasundertaken not to dispose of their interest in the Issuer.

The Quotaholder and Undertakings Agreement is governed by Italian law.

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H. Liquidity Facility Agreement

Under the Liquidity Facility Agreement entered into on or around the Issue Date between the Issuer, theLiquidity Provider and the Representative of the Noteholders, the Liquidity Provider will provide arenewable 364 day committed facility in a maximum aggregate principal amount of euro 8,991,500, whichmay be used by the Issuer, under the terms and subject to the conditions set out therein. For additionalfeatures, see section “Credit Structure – Liquidity Facility”.

The Liquidity Facility Agreement is governed by Italian law.

I. Interest Rate Swap Agreement

Under the Interest Rate Swap Agreement documented under an ISDA Master Agreement entered into on oraround the Issue Date between the Issuer, the Hedging Counterparty and the Representative of theNoteholders, the Issuer will hedge against potential interest rate exposure arising from Modular Loans inrespect of which the rate of interest has been switched from floating in the Collection Period preceding suchPayment Date to a fixed rate. The Hedging Counterparty and the Issuer will furthermore enter into a 1995ISDA Credit Support Annex (Bilateral Form – Transfer) pursuant to which the Hedging Counterparty willsupport its obligations under the Interest Rate Swap Agreement and the Interest Rate Cap Agreement underthe terms and subject to the conditions set out therein. For additional features, see section “Credit Structure –Interest Rate Swap”.

The Interest Rate Swap Agreement is governed by English law.

J. Interest Rate Cap Agreement

Under the Interest Rate Cap Agreement documented under an ISDA Master Agreement entered into on oraround the Issue Date between the Issuer, the Hedging Counterparty and the Representative of theNoteholders, the Issuer will hedge against potential exposure arising from fluctuations in Euribor which maycause its floating interest rate obligations under the Rated Notes to exceed the rate of return generated by theLoans comprised in the Portfolio. The Hedging Counterparty and the Issuer will furthermore enter into a1995 ISDA Credit Support Annex (Bilateral Form – Transfer) pursuant to which the Hedging Counterpartywill support its obligations under the Interest Rate Cap Agreement and the Interest Rate Swap Agreementunder the terms and subject to the conditions set out therein. For additional features, see section “CreditStructure – Interest Rate Cap”.

The Interest Rate Cap Agreement is governed by English law.

K. Master Definitions and Construction Agreement

Under the Master Definitions and Construction Agreement entered into on or about the Issue Date between,inter alios, the Issuer, the Originator, the Representative of the Noteholders, the Servicer, the CalculationAgent, the Account Banks, the parties thereto have agreed the definitions, the principles of constructions, thecommon terms and other provisions applicable to the transaction documents executed in connection with theSecuritisation.

The Master Definitions and Construction Agreement is governed by Italian law.

L. Subscription Agreements

Pursuant to the Rated Notes Subscription Agreement entered into on or about the Issue Date, between theIssuer, the Representative of the Noteholders, the Arranger and the Lead Manager, the Lead Manager hasagreed to subscribe for the Rated Notes.

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Pursuant to the Class Z Notes Subscription Agreement entered into on or about the Issue Date between theIssuer, the Representative of the Noteholders and the Class Z Notes Subscriber, the Class Z Notes Subscriberhas agreed to subscribe for the Class Z Notes.

Under the Subscription Agreements, the Lead Manager and the Class Z Notes Subscriber, as the case maybe, as initial subscribers of the Notes of the relevant Class or Classes, have appointed Deutsche TrusteeCompany Limited as Representative of the Noteholders to perform, in their name and behalf and in the nameand on behalf of all subsequent Noteholders of the relevant Class, the activities described in the Conditionsand the other Transaction Documents and Deutsche Trustee Company Limited has accepted suchappointment.

The Subscription Agreements are governed by Italian law.

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CREDIT STRUCTURE

The Notes will be limited recourse obligations solely of the Issuer. In particular, the Notes will not beobligations or responsibilities of, or guaranteed by, any of the Quotaholder, the Representative of theNoteholders, the Italian Paying Agent, the Additional Paying Agent, the Cash Manager, the CalculatingAgent, the Transaction Account Bank, the Italian Account Bank, the Originator, the Servicer, theLiquidity Provider, the Corporate Servicer, the Hedging Counterparty, the Arranger, the Lead Managerand the Class Z Notes Subscriber (in each case, such person in any capacity in which it is acting), or anyother person. Furthermore, none of such persons accepts any liability whatsoever in respect of any failureby the Issuer to make any payment of any amount due on the Notes.

It is expected that the Rating Agencies will, on issue, assign to the Rated Notes the following ratings:

Moody’s S&P

Class A Notes Aaa AAA

Class B Notes Aa2 AA

Class C Notes A1 A

Class D Notes Baa2 BBB-

Class E Notes B3 N.A.

A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision orwithdrawal at any time by the assigning Rating Agency.

SUBORDINATION OF NOTES AS BETWEEN CLASSES

The Notes of each Class shall rank pari passu without preference or priority amongst themselves, providedthat:

(a) in respect of the obligation of the Issuer to pay interest on the Notes, prior to the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event, (i) the Class A Notes will rankpari passu and pro rata among themselves and in priority to the Class B Notes, the Class C Notes,Class D Notes, the Class E Notes and the Class Z Notes; (ii) the Class B Notes will rank pari passuand pro rata among themselves and in priority to the Class C Notes, the Class D Notes, the Class ENotes and the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class C Notes will rankpari passu and pro rata among themselves and in priority to the Class D Notes, the Class E Notesand the Class Z Notes, but subordinated to the Class A Notes and the Class B Notes; (iv) the Class DNotes will rank pari passu and pro rata among themselves and in priority to the Class E Notes andthe Class Z Notes, but subordinated to the Class A Notes, the Class B Notes and the Class C Notes;(v) the Class E Notes will rank pari passu and pro rata among themselves and in priority to theClass Z Notes, but subordinated to the Class A Notes, the Class B Notes, the Class C Notes and theClass D Notes; (vi) the Class Z Notes will rank pari passu and pro rata among themselves butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes under the terms set out in Condition 5.1 (Order of Priority – Pre-Enforcement InterestPriority of Payments).

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(b) in respect of the obligation of the Issuer to repay principal of the Notes prior to the service of anIssuer Enforcement Notice or the occurrence of an Issuer Insolvency Event:

(A) If the Pro rata Amortisation Conditions are not met: (i) the Class A Notes will rank paripassu and pro rata without any preference or priority among themselves and in priority tothe Class B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class ZNotes; (ii) the Class B Notes will rank pari passu and pro rata without any preference orpriority among and in priority to the Class C Notes, the Class D Notes, the Class E Notesand the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class C Notes willrank pari passu and pro rata without any preference or priority among themselves and inpriority to the Class D Notes, the Class E Notes and the Class Z Notes, but subordinated tothe Class A Notes and the Class B Notes; (iv) the Class D Notes will rank pari passu andpro rata without any preference or priority among themselves and in priority to the Class ENote and the Class Z Notes, but subordinated to the Class A Notes, the Class B Notes, theClass C Notes; (v) the Class E Notes will rank pari passu and pro rata without anypreference or priority among themselves and in priority to the Class Z Notes, butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes and the Class DNotes; (vi) the Class Z Notes will rank pari passu and pro rata without any preference orpriority among themselves and subordinated to the Class A Notes, the Class B Notes, theClass C Notes, the Class D Notes and the Class E Notes; and

(B) if the Pro rata Amortisation Conditions are met on any Calculation Date, then on theimmediately following Payment Date, the Class A Notes, the Class B Notes, the Class CNotes, the Class D Notes and the Class E Notes will rank pari passu and pro rata withoutany preference or priority among themselves in respect of repayment of principal under theterms set out in Condition 5.2, whilst the Class Z Notes will rank pari passu and pro ratawithout preference of priority among themselves and subordinated in respect of repaymentof principal to the Rated Notes of all Classes (Order of Priority – Pre-EnforcementPrincipal Priority of Payments);

(c) Following the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent, (i) the Class A Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal in priority to theClass B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes for allpurposes; (ii) the Class B Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal and in priority tothe Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes for all purposes, butsubordinated to the Class A Notes; (iii) the Class C Notes will rank pari passu and pro rata withoutany preference or priority among themselves in respect of payments of interest and of repayment ofprincipal and in priority to the Class D Notes, the Class E Notes and the Class Z Notes for allpurposes, but subordinated to the Class A Notes and the Class B Notes; (iv) the Class D Notes willrank pari passu and pro rata without any preference or priority among themselves in respect ofpayments of interest and of repayment of principal and in priority to the Class E Notes and the ClassZ Notes for all purposes, but subordinated to the Class A Notes, the Class B Notes, the Class CNotes; (v) the Class E Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal and in priority tothe Class Z Notes for all purposes, but subordinated to the Class A Notes, the Class B Notes, theClass C Notes and the Class D Notes; (vi) the Class Z Notes will rank pari passu and pro ratawithout any preference or priority among themselves for all purposes and subordinated in respect ofpayments of interest and of repayment of principal to the Class A Notes, the Class B Notes, the ClassC Notes, the Class D Notes and the Class E Notes, under the terms set out in Condition 5.5 (Order ofPriority –Enforcement Priority of Payments).

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CREDIT TRIGGER

Following the occurrence of a Class B Credit Trigger Event and at all times thereafter, payments in respectof interest on the Class B Notes will be subordinated to the payment of interest on the Class A Notes andother items ranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments.

Following the occurrence of a Class C Credit Trigger Event and at all times thereafter, payments in respectof interest on the Class C Notes will be subordinated to the payment of interest on the Class A and the ClassB Notes and other items ranking in priority thereto in accordance with the Pre-Enforcement Interest Priorityof Payments.

Following the occurrence of a Class D Credit Trigger Event and at all times thereafter, payments in respectof interest on the Class D Notes will be subordinated to the payment of interest on the Class A Notes, theClass B Notes and the Class C Notes and other items ranking in priority thereto in accordance with the Pre-Enforcement Interest Priority of Payments.

Following the occurrence of a Class E Credit Trigger Event and at all times thereafter, payments in respect ofinterest on the Class E Notes will be subordinated to the payment of interest on the Class A Notes, the ClassB Notes, the Class C Notes and the Class D Notes and other items ranking in priority thereto in accordancewith the Pre-Enforcement Interest Priority of Payments.

The Class B Notes will provide credit support for the Class A Notes. The Class C Notes will provide creditsupport for the Class A Notes and the Class B Notes. The Class D Notes will provide credit support for theClass A Notes, the Class B Notes and the Class C Notes. The Class E Notes will provide credit support forthe Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes. The Class Z Notes willprovide credit support for the Rated Notes, as they have funded the Cash Reserve and will only beredeemable once the Rated Notes have been redeemed in full.

The effect of the Credit Trigger Events is to subordinate the interest payments on the Class B Notes, theClass C Notes, the Class D Notes and the Class E Notes, as the case may be, to the reduction of the relevantPrincipal Deficiency Sub-Ledgers and the increase of the Principal Available Funds by previously coveredShortfall Amounts as specified in the Pre-Enforcement Interest Priority of Payments.

The obligation of the Issuer to pay interest and principal on the Notes will be subject to the applicablePriority of Payments and the limited recourse provisions set out in Condition 19 (Limited Recourse), andsuch amounts will only be payable to the extent that the Issuer has sufficient funds after making payment orproviding for the payment of all amounts required to be paid or provided for pursuant to Condition 5 (Orderof Priority) and the relevant provisions of the Intercreditor Agreement in priority to such payments.

Pursuant to the Cash Management Agreement, the Calculation Agent shall verify, on each Calculation Date,the occurrence of a Credit Trigger Event; the outcome of such verification together with the relevant detailswill be reported in the relevant Payments Report.

PRINCIPAL DEFICIENCY SUB-LEDGERS

On each Calculation Date the Issuer shall enter or procure to be entered (A) as a debit the principal amountof each Loan Receivable in the Portfolio arising from Loans which have been classified as Defaulted LoanReceivables during the immediately preceding Collection Period: (a) up to the then aggregate PrincipalAmount Outstanding of the Class E Notes, on the Class E Principal Deficiency Sub-Ledger; and/or (b)thereafter, up to the then aggregate Principal Amount Outstanding of the Class D Notes, on the Class DPrincipal Deficiency Sub-Ledger; and/or (c) thereafter, up to the then Principal Amount Outstanding of theClass C Notes, on the Class C Principal Deficiency Sub-Ledger; and/or (d) thereafter, up to the thenPrincipal Amount Outstanding of the Class B Notes, on the Class B Principal Deficiency Sub-Ledger, and/or(e) thereafter, up to the then Principal Amount Outstanding of the Class A Notes, on the Class A Principal

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Deficiency Sub-Ledger, as the case may be, in each case taking into account any amount previously enteredas a debit on each Principal Deficiency Sub-Ledger and in respect of which funds have not yet been allocatedin accordance with the Interest Priority of Payments.

CASH RESERVE

On the Issue Date, the Issuer shall credit an amount equal to the Cash Reserve Amount into the Cash ReserveAccount. If, on any Calculation Date, the Income Available Funds (with the exception of items (b), (c) and(d) thereof), are not sufficient to enable the Issuer to make payment for items (a) to (t) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated on such Calculation Date), the Issuer shall beentitled, on the immediately following Cash Reserve Drawdown Date, to draw on the Cash Reserve in anamount equal to the Cash Reserve Drawing Amount for application in accordance with the Pre-EnforcementInterest Priority of Payments to cover such shortfall. Subject to the sufficiency of funds available to theIssuer for such purpose and the Pre-Enforcement Interest Priority of Payments, the Issuer shall at all timesmaintain an amount in the Cash Reserve Account equal to the Cash Reserve Required Amount.

On the Issue Date, the Cash Reserve Required Amount will be equal to euro 3,853,500, being 1.5 per cent.of the aggregate Principal Amount Outstanding of the Notes. On each Payment Date falling on or after thefirst Payment Date on which the Cash Reserve is equal to or greater than 3.0 per cent. of the aggregatePrincipal Amount Outstanding of the Notes (each a “Cash Reserve Determination Date”) and if:

(a) all balances on each of the Principal Deficiency Sub-Ledgers are zero;

(b) no amount in the Liquidity Facility has been drawn before the relevant Cash Reserve DeterminationDate;

(c) the amount in the Cash Reserve is equal to or greater than the Cash Reserve Required Amount as ofthe relevant Cash Reserve Determination Date;

(d) the Arrears Ratio does not exceed 5 per cent. of the total balance of all the Loan Receivablescomprised in the Portfolio;

(e) the result produced by the fraction (B+C+D+E)/(A+B+C+D+E) is greater than or equal to twice theresult produced by that fraction as at the Issue Date; and

(f) the Unpaid Principal Deficiency is lower than 6 per cent.,

then the Cash Reserve Required Amount will be reduced to an amount equal, on such Cash ReserveDetermination Date, to the greater of euro 1,926,750 and 3.0 per cent. of the then Principal AmountOutstanding of the Notes.


A = the aggregate Principal Amount Outstanding of the Class A Notes on such date;

B = the aggregate Principal Amount Outstanding of the Class B Notes on such date;

C = the aggregate Principal Amount Outstanding of the Class C Notes on such date;

D = the aggregate Principal Amount Outstanding of the Class D Notes on such date; and

E = the aggregate Principal Amount Outstanding of the Class E Notes on such date.

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The Cash Reserve Required Amount will be reduced to zero on the Calculation Date immediately followingthe Payment Date on which the Rated Notes will be redeemed in full and/or following the service of anIssuer Enforcement Notice or the occurrence of an Issuer Insolvency Event.

THE LIQUIDITY FACILITY AGREEMENT

The Liquidity Facility Agreement will be entered into on or around the Issue Date between the Issuer, theLiquidity Provider and the Representative of the Noteholders. The Liquidity Provider is required to be anEligible Institution.

Under the Liquidity Facility Agreement, the Liquidity Provider will provide a renewable 364 day committedfacility in a maximum aggregate principal amount of euro 8,991,500 (the “Liquidity Facility Amount”)which will be available to be drawn by the Issuer if, on any Calculation Date, the Income Available Funds(with the exception of items (c) and (d) thereof), are not sufficient to enable the Issuer to make payment foritems (a) to (j) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated on suchrelevant Calculation Date) (hereinafter a “Liquidity Shortfall”).

The Liquidity Facility Agreement provides that the Issuer shall, not more than 30 nor fewer than 20 daysprior to the end of each Commitment Period, request that the Liquidity Provider renew its commitment for afurther period not exceeding 364 days.

If the Liquidity Provider (i) declines to renew its commitment under the Liquidity Facility and/or (ii) ceasesto be an Eligible Institution and (iii) is unable to procure a replacement Liquidity Provider (which shall be anEligible Institution) to provide a facility on the same terms as those provided under the Liquidity FacilityAgreement, the Issuer may draw down, in accordance with the terms set out in the Liquidity FacilityAgreement, the then available commitment under the Liquidity Facility (a “Standby Drawing”) and depositsuch amount into the Liquidity Reserve Account. Any Standby Drawing will be repaid on the earlier of (a)the date on which the Rated Notes are fully redeemed or finally mature; (b) if the Standby Drawing wasmade following the Liquidity Provider ceasing to be an Eligible Institution, (i) the day on which areplacement Liquidity Provider enters into a new liquidity facility with the Issuer having the same terms asthose provided under the Liquidity Facility Agreement, or (ii) the first Payment Date after which theLiquidity Provider re-qualifies as an Eligible Institution. The Liquidity Reserve Account and all sumsstanding to the credit thereto will be charged by the Issuer in favour of the Representative of the Noteholderspursuant to the terms of the Deed of Charge.

If a Standby Drawing is made under the terms of the Liquidity Facility Agreement and a Liquidity Shortfalloccurs, the Issuer shall be entitled to withdraw from the Liquidity Reserve Account an amount sufficient tocover such shortfall.

The Liquidity Provider will be an Issuer Secured Creditor and will, therefore, have no claim against orrecourse to any assets of the Issuer for any amounts due under the Liquidity Facility in excess of the amountspermitted to be paid in accordance with the applicable Priority of Payments. Any replacement LiquidityProvider will be required to accede to the Issuer Security Documents and become an Issuer Secured Creditor.

Deutsche Bank S.p.A. in its capacity as Liquidity Provider under the Liquidity Facility Agreement willundertake that if by the date falling three months from the date of execution of the Liquidity FacilityAgreement (the “Rating Date”) its short-term, unsecured and unsubordinated debt obligations are not ratedat least as high as “Prime-1” by Moody’s (publicly disclosed or not), it will procure within one month fromthe Rating Date that:

(a) an Eligible Institution grants in favour of the Issuer and the Representative of the Noteholders anirrevocable first demand guarantee to guarantee the performance of its obligation as Liquidity Providerunder the Liquidity Facility Agreement; or alternatively

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(b) an Eligible Institution is appointed as replacement Liquidity Provider under the terms set out in theLiquidity Facility Agreement.

The Issuer shall pay to the Liquidity Provider in accordance with the Priority of Payments (i) a commitmentfee which shall accrue from day to day with effect from the Issue Date at the rate of 0.20 per cent. per annumto be paid quarterly in arrears on each Payment Date and to be calculated by reference to the amountundrawn under the Liquidity Facility Agreement and (ii) interest equal to Euribor plus 0.40 per cent. perannum to be calculated on the amount drawn under the Liquidity Facility Agreement.

The Liquidity Facility Agreement will be governed by Italian law.

ISSUER ACCOUNTS – ELIGIBLE INVESTMENTS












provided that, subject to the provisions of the Cash Management Agreement, (i) following the Initial Period,the Principal Reserve Account and the Class E Notes Principal Accumulation Account shall be closed and,respectively, amounts previously credited to the Principal Reserve Account shall be credited to theInvestment Account, and amounts previously credited to the Class E Notes Principal Accumulation Accountshall be applied in repayment of principal of the Class E Notes in accordance with Condition 5.2 (Pre-Enforcement Principal Priority of Payments and use of the Class E Notes Principal Accumulation Funds),and (ii) the Cash Reserve Account shall be closed once the Rated Notes are repaid in full or otherwisecancelled in accordance with the Conditions.


Amounts standing to the credit of the Originator Collection Account will be transferred daily from theOriginator Collection Account to the Issuer Collection Account and then further transferred on a weeklybasis to the Investment Account, provided that, if the debt rating for the long-term unsecured,unsubordinated and unguaranteed debt obligations of Deutsche Bank AG falls below “Aa3” by Moody’ssuch amounts will be transferred on a daily basis to the Investment Account.

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On the 15th calendar day and the last calendar day of each month (provided that, if any of such dates is not aBusiness Day, such date will be the first following day that is a Business Day, and further provided that suchday is not a Payment Date), amounts standing to the credit of the Investment Account and the Cash ReserveAccount may be invested by the Cash Manager on behalf of the Issuer under the terms of the CashManagement Agreement in Eligible Investments which, if represented by securities, shall be credited to theSecurities Account.

On each Swap Payment Date and Interest Rate Cap Payment Date, the Issuer and the Hedging Counterpartyshall make the relevant payments under the Hedging Agreements.

On or prior to each Payment Date, the Cash Manager shall on behalf of the Issuer (i) liquidate the EligibleInvestments standing to the credit of the Securities Account and transfer the relevant proceeds thereof to theInvestment Account and the Cash Reserve Account (as appropriate) and (ii) transfer all amounts standing tothe credit of the Investment Account to the Payments Account.

Prior to the expiry of the Initial Period, the Cash Manager and the Paying Agents shall apply, in compliancewith the Payments Report, on or prior to each Payment Date, the amounts so transferred to the PaymentsAccount in accordance with the Priority of Payments.

One Business Day following each Payment Date falling during the Initial Period, all amounts transferred tothe Principal Reserve Account shall be subsequently credited to the Investment Account and may beinvested, in whole or in part, by the Cash Manager on behalf of the Issuer under the terms of the CashManagement Agreement, in Eligible Investments which, if represented by securities, shall be further creditedto the Securities Account. The Principal Reserve Account shall be closed following the Initial Period (andamounts previously credited thereto shall be credited to the Investment Account).

On each Payment Date after the expiry of the Initial Period, the Cash Manager and the Paying Agents, shall,in compliance with the Payments Report, apply the amounts standing to the credit of the Payments Accountin accordance with the Priority of Payments.

Pursuant to the Cash Management Agreement, the Transaction Account Bank and the Italian Account Bankwill contract to pay an agreed rate of interest on funds on deposit in the relevant Issuer Accounts. Each of theTransaction Account Bank and the Italian Account Bank shall waive any set-off, retention and other rights inrespect of the relevant Issuer Accounts held by it.

INTEREST RATE SWAP

Interest on the Notes is payable at a rate equal to Euribor plus the applicable margin.

The Modular Loans give the relevant Borrower the option to change the interest rate they pay from a floatingrate to a fixed rate based on prevailing market rates on the third anniversary and thereafter every three years.

Payments will be received by the Issuer from the Borrowers under certain of the Modular Loans at certaintimes calculated by reference to fixed interest rates. The Issuer is reliant on collections from the Loans(including the Modular Loans) in order to make payments to the Issuer under the Notes. In order to mitigatethe risks caused by such fixed interest rates and Euribor payable on the Notes diverging, the Issuer will enterinto an interest rate swap transaction (each an Interest Rate Swap) with the Hedging Counterparty,documented under a fixed/floating rate swap confirmation.

On each Payment Date, the Issuer will, under the Interest Rate Swap Agreement, hedge against potentialinterest rate exposure arising from Modular Loans in respect of which the rate of interest has been switchedfrom floating in the Collection Period preceding such Payment Date to a fixed rate. For each such sub-portfolio of Modular Loans in respect of which a switch of interest has happened in any given month duringthe relevant Collection Period, the fixed rate amounts payable by the Issuer under such swap will be

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calculated on the basis of the Notional Amount (as defined in the confirmation for such swap) and a fixedrate based on the published 3 year Euro swap rate as observed on a selected date during such month.

INTEREST RATE CAP

On or prior to the Issue Date, the Issuer will enter into the Interest Rate Cap Agreement with the HedgingCounterparty and the Representative of the Noteholders, in order to protect itself against the impact of a risein three-month Euribor (as defined under the Interest Rate Cap Agreement) above the Interest Rate CapStrike Rate.

Pursuant to the Interest Rate Cap Agreement, the Issuer will receive from the Hedging Counterparty, on theInterest Rate Cap Payment Date, an amount equal to the Notional Amount, multiplied by the excess ofsuch three-month Euribor over the Interest Rate Cap Strike Rate, multiplied by the actual number of days inthe relevant Interest Period divided by 360. This payment will assist the Issuer to meet its interest paymentobligations on the Notes should three-month Euribor exceed the Interest Rate Cap Strike Rate.

The Notional Amount will initially be equal to Euro 20 million.

Hedging Agreements

The Interest Rate Swap Agreement and the Interest Rate Cap Agreement will be documented under an ISDAMaster Agreement and will govern the over-the-counter swap transactions negotiated at arm’s lengthbetween the Issuer and the Hedging Counterparty. Each of the Hedging Agreement may be terminated inaccordance with Events of Default and Termination Events (each as defined in the ISDA Master Agreement)commonly found in standard ISDA documentation. Any of the Hedging Agreements will be terminable byone party if (i) an applicable Event of Default or Termination Event (as defined therein) occurs in relation tothe other party, (ii) it becomes unlawful for either party to perform its obligations under the relevant HedgingAgreement or (iii) an Issuer Enforcement Notice is served. Events of Default under any of the HedgingAgreements in relation to the Issuer will be limited to certain insolvency events.

In addition, the Hedging Agreements will become subject to early termination if all of the Rated Notes areredeemed in whole, repaid or cancelled at any time prior to the Maturity Date.

Upon the early termination of any of the Hedging Agreements, the Issuer or the Hedging Counterparty maybe liable to make a termination payment to the other party. In the event that any of the Hedging Agreementsis terminated early due to a specific additional termination event, a termination payment based on marketquotations may also be payable. The amount of any termination payment will be based on the market valueof such Hedging Agreement (and payable under the netting terms of the single ISDA Master Agreementgoverning such Hedging Agreement). The market value will be based on market quotations of the cost ofentering into replacement transactions with the same terms and conditions and that would have the effect ofpreserving the respective full payment obligations of the parties (or based upon loss in the event that nomarket quotation can be obtained).

Withholding Tax

In the event that the Issuer is required to withhold or deduct an amount in respect of tax from payments duefrom it to the Hedging Counterparty under any of the Hedging Agreements, the Issuer will not be requiredpursuant to the terms of the relevant Hedging Agreement to pay the Hedging Counterparty such amounts aswould otherwise have been required to ensure that the Hedging Counterparty received the same amounts thatit would have received had such withholding or deduction not been made.

In the event that Hedging Counterparty is required to withhold or deduct an amount in respect of tax frompayments due from it to the Issuer under any of the Hedging Agreements, the Hedging Counterparty will berequired pursuant to the terms of such Hedging Agreement to pay to the Issuer such additional amounts as

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are required to ensure that the Issuer receives the same amounts that it would have received had suchwithholding or deduction not been made. The Hedging Counterparty will not be permitted to terminate anyHedging Agreement as the result of any withholding tax being imposed on any payments, but will bepermitted to take certain other remedial actions.

Hedging Counterparty Downgrade

If the short-term, unsecured and unsubordinated debt obligations of the Hedging Counterparty cease to berated as high as “A-1” by S&P or “Prime-1” by Moody’s or the long-term, unsecured, unsubordinated debtobligations of the Hedging Counterparty cease to be rated as high as “A+” by S&P or “A2” by Moody’s (theMinimum Hedging Counterparty Ratings) or any such rating is withdrawn by S&P or Moody’s, theHedging Agreements will require the Hedging Counterparty, within 30 days of the occurrence of suchdowngrade at the cost of the Hedging Counterparty, to:

(a) procure a replacement swap provider with the applicable Minimum Hedging Counterparty Ratingsor, in certain circumstances, such other rating as is commensurate with the ratings assigned to theNotes by the Rating Agencies from time to time; or

(b) procure another person with the applicable Minimum Hedging Counterparty Ratings to become co-obligor or guarantor in respect of its obligations under the relevant Hedging Agreement; or

(c) provide collateral for its obligations under the relevant Hedging Agreement in accordance with theterms of the relevant Hedging Agreement and the Hedging Agreement Credit Support Document (asdefined below).

If at any time the rating of certain debt obligations of the Hedging Counterparty, falls below a further ratinglevel specified in the Hedging Agreements, the remedial measures available to the Hedging Counterpartymay be more limited.

If the Hedging Counterparty fails to take one of the actions described above within the specified periodsreferred to in the Hedging Agreements, then the Issuer will be entitled to terminate the relevant HedgingAgreement.

The Hedging Agreements will be governed by English law.

Hedging Agreement Credit Support Document

The Hedging Counterparty will agree a 1995 ISDA Credit Support Annex (Bilateral Form – Transfer) withthe Issuer (a Hedging Agreement Credit Support Document) on or around the Issue Date in support of theHedging Counterparty ‘s obligations under the Interest Rate Swap Agreement and the Interest Rate CapAgreement. The obligations in respect of the Hedging Agreement Credit Support Document shall only applyin the event that the Hedging Counterparty ceases to have the Minimum Hedging Counterparty Rating. TheHedging Agreement Credit Support Document will form part of the ISDA Master Agreement.

Pursuant to the terms of the Hedging Agreement Credit Support Document, if at any time the HedgingCounterparty is required to provide collateral in respect of any of its obligations under any of the HedgingAgreements, the Hedging Agreement Credit Support Document will provide that, from time to time andsubject to the conditions specified in the Hedging Agreement Credit Support Document and the relevantHedging Agreement, the Hedging Counterparty will make transfers of cash or securities by way of collateralto the Issuer in support of its obligations under the relevant Hedging Agreement and the Issuer will beobliged to return such collateral in accordance with the terms of the Hedging Agreement Credit SupportDocument.

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Where the Hedging Counterparty provides collateral for its obligations under any of the HedgingAgreements in accordance with the terms of the Hedging Agreement Credit Support Document, suchcollateral will, upon receipt by the Issuer, be credited to a separate ledger created to record the amount ofcollateral received under the relevant Hedging Agreement (the Collateral Sub-Ledger) and transferred (if incash form) to the Investment Account or such other account established for such purpose. Any collateralprovided by the Hedging Counterparty will not form part of the Available Funds other than collateralamounts applied in satisfaction of termination payments due to the Issuer following the designation of anearly termination date under any of the Hedging Agreements.

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ISSUER ACCOUNTS AND CASH FLOWS

ISSUER ACCOUNTS












provided that, subject to the provisions of the Cash Management Agreement, (i) the Principal ReserveAccount and the Class E Notes Principal Accumulation Account shall be closed following the Initial Periodand, respectively, amounts previously credited to the Principal Reserve Account shall be credited to theInvestment Account, and amounts previously credited to the Class E Notes Principal Accumulation Accountshall be applied in repayment of principal of the Class E Notes in accordance with the Pre-EnforcementPrincipal Priority of Payments, and (ii) the Cash Reserve Account shall be closed once the Rated Notes arerepaid in full or otherwise cancelled in accordance with the Conditions.


CASH FLOWS

The Issuer will undertake in the Intercreditor Agreement and the Cash Management Agreement to pay thefollowing amounts into, and withdraw the following amounts from (or to procure that the same are paid intoand withdrawn from, respectively), the Issuer Accounts, on the dates indicated, subject to and in accordancewith the more detailed provisions contained in the Intercreditor Agreement and the Cash ManagementAgreement. No withdrawal from any Issuer Account shall be permitted to the extent that such withdrawalwould cause the relevant Issuer Account to become overdrawn.

ISSUER COLLECTION ACCOUNT

1.1 Payments into the Issuer Collection Account: the Issuer Collection Account shall be credited withthe following amounts:

(a) on each Business Day, all amounts standing to the credit of the Originator Collection Account (orother Collection received directly from the Obligors);

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(b) all interest paid from time to time on the balance of the Issuer Collection Account;

(c) the amount of (i) any warranty or indemnity claim paid by the Originator pursuant to the MasterTransfer Agreement and the other Transaction Documents, and (ii) any indemnity claim paid by anyother Transaction Party to the Issuer pursuant to any Transaction Document;

(d) the amount of any Limited Recourse Loan granted by the Originator pursuant to the Master TransferAgreement; and

(e) the proceeds of disposal of the Portfolio or any part thereof (if any).

1.2 Payments out of the Issuer Collection Account: the Italian Account Bank shall withdraw thefollowing amounts from the Issuer Collection Account (provided that each such withdrawal does not causethe Collection Account to become overdrawn): by no later than 12,00 a.m. (London time) on the firstcalendar day of each week (or, if such date is not a Business Day, such date will be the first following daythat is a Business Day), all sums standing to the credit of the Issuer Collection Account for transfer to theInvestment Account, provided further that, if the debt rating for the long-term unsecured, unsubordinatedand unguaranteed debt obligations of Deutsche Bank AG falls below “Aa3” by Moody’s, such amounts willbe transferred on each Business Day to the Investment Account.

INVESTMENT ACCOUNT

2.1 Payments into the Investment Account: the Transaction Account Bank shall credit, or procure thecrediting of the Investment Account with the following amounts:

(a) By no later than 12,00 a.m. (London time) on the first calendar day of each week (provided that, ifsuch date is not a Business Day, such date will be the first following day that is a Business Day, andfurther provided that such day is not a Payment Date), all amounts standing to the credit of theIssuer Collection Account, provided further that, if the debt rating for the long-term unsecured,unsubordinated and unguaranteed debt obligations of Deutsche Bank AG falls below “Aa3” byMoody’s, such amounts will be transferred on each Business Day to the Investment Account;

(b) all interest paid from time to time on the balance of the Investment Account;

(c) 2 (two) Business Days prior to each Payment Date, all proceeds deriving from the liquidation of theEligible Investments (if any) represented by securities originally standing to the credit of theSecurities Account, purchased by using amounts transferred from the Investment Account; and

(d) on each Payment Date during the Initial Period, the amount equal to the Principal Available Funds asspecified in the relevant Payments Report credited on such Payment Date to the Principal ReserveAccount.

2.2 Payments out of the Investment Account: The Transaction Account Bank shall withdraw thefollowing amounts from the Investment Account (provided that each such withdrawal does not cause theInvestment Account to become overdrawn):

(a) no later than 12.00 a.m. (London time), 2 (two) Business Days preceding each Payment Date, theamounts instructed by the Calculation Agent to be paid into the Payments Account pursuant to thePayments Report delivered pursuant to Clause 6.4 (Delivery of Payments Report) of the CashManagement Agreement shall be transferred to the Payments Account for application on suchPayment Date in accordance with the applicable Priority of Payments; and

(b) On the 15th calendar day and the last calendar day of each month (or, if any of such dates is not aBusiness Day, on the first following day that is a Business Day, unless such day is a Payment Date),

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the amounts necessary to pay the purchase or subscription price for the Eligible Investments (if any),represented by securities, that the Cash Manager has instructed the Transaction Account Bank toacquire on behalf of the Issuer, to be credited on the Securities Account.

PAYMENTS ACCOUNT

3.1 Payments into the Payments Account: the Italian Account Bank shall credit the following amountsinto the Payments Account:

(a) all amounts transferred from the Investment Account pursuant to paragraph 2.2 (a) above;

(b) all amounts transferred from the Cash Reserve Account pursuant to paragraph 5.2 below;

(c) on each Swap Payment Date and Interest Rate Cap Payment Date, all amounts received from theHedging Counterparty pursuant to the terms of the relevant Hedging Agreement;

(d) all amounts transferred from the Class E Notes Principal Accumulation Account pursuant toparagraph 7.2 below; and

(e) 3 (three) Business Days prior to each Payment Date, any amount to be advanced by the LiquidityProvider under the Liquidity Facility Agreement (if any).

3.2 Payments out of the Payments Account: the Italian Account Bank shall withdraw the followingamounts from the Payments Account (provided that each such withdrawal does not cause the PaymentsAccount to become overdrawn):

(a) on each Payment Date during the Initial Period, the amount equal to the Principal Available Funds asspecified in the relevant Payments Report to be credited to the Principal Reserve Account;

(b) two Business Days prior to each Payment Date, the amounts to be credited to the Paying Agents forpayments to be made on the Notes on such Payment Date, as specified in the relevant PaymentsReport; and

(c) on each Payment Date (or, in the case of payments to be made after an Payment Date and which areprovided for in the relevant Payments Report prepared by the Calculation Agent prior to suchPayment Date, on the date for payment and to the payee specified in such Payments Report), theamounts instructed by the Calculation Agent to be paid to the relevant payee as specified in therelevant Payments Report.

PRINCIPAL RESERVE ACCOUNT

4.1 Payments into the Principal Reserve Account: the Transaction Account Bank shall credit thePrincipal Reserve Account with all amounts transferred from the Payments Account pursuant toparagraph 3.2(a) above.

4.2 Payments out of the Principal Reserve Account: the Transaction Account Bank shall withdraw thefollowing amounts from the Principal Reserve Account (provided that each such withdrawal does not causethe Principal Reserve Account to become overdrawn): one Business Day following each Payment Dateduring the Initial Period, the amount equal to the Principal Available Funds as specified in the relevantPayments Report to be credited on such date to the Investment Account.

The Principal Reserve Account shall be closed following the Initial Period and amounts previously creditedthereto shall be credited to the Investment Account.

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CASH RESERVE ACCOUNT

5.1 Payments into the Cash Reserve Account: the Transaction Account Bank shall credit, or procure thecrediting of the Cash Reserve Account, with the following amounts:

(a) on the Issue Date, the Cash Reserve Amount;

(b) all interest paid from time to time on the balance of the Cash Reserve Account;

(c) 2 (two) Business Days prior to each Payment Date, all proceeds deriving from the liquidation of theEligible Investments (if any) represented by securities originally standing to the credit of theSecurities Account, purchased by using amounts transferred from the Cash Reserve Account;

(d) on each Payment Date, the amounts standing to the credit of the Payments Account that arenecessary to replenish the Cash Reserve Account up to the Cash Reserve Required Amount;

5.2 Withdrawals from the Cash Reserve Account: The Transaction Account Bank shall withdraw thefollowing amounts from the Cash Reserve Account (provided that each such withdrawal does not cause theCash Reserve Account to become overdrawn):

(a) on the 15th calendar day and the last calendar day of each month (or, if any of such dates is not aBusiness Day, on the first following day that is a Business Day, unless such day is a Payment Date),the amounts necessary to pay the purchase or subscription price for the Eligible Investments (if any),represented by securities, that the Cash Manager has instructed the Transaction Account Bank toacquire on behalf of the Issuer, to be credited on the Securities Account; and

(b) no later than 5.00 p.m. (London time) on the date falling 2 (two) Business Days prior to eachPayment Date, the Transaction Account Bank shall transfer an amount equal to the Cash ReserveDrawing Amount and/or the Cash Reserve Release Amount to the Payments Account for applicationon such Payment Date.

The Cash Reserve Account shall be closed once the Rated Notes will have been fully redeemed or otherwisecancelled in accordance with the Conditions.

EXPENSES ACCOUNT

6.1 Payments into the Expenses Account: an amount which is necessary to replenish the ExpensesAccount up to the Quarterly Maintenance Amount.

6.2 Payments out of the Expenses Account:

(a) amounts due to the Corporate Servicer pursuant to the Corporate Services Agreement; and

(b) from time to time, such costs, expenses, fees, taxes or other amounts incurred by the Issuer inconnection with the Securitisation and required to preserve the Issuer’s corporate existence andmaintain it in good standing or to be paid by any applicable law to any Connected Third PartyCreditor.

CLASS E NOTES PRINCIPAL ACCUMULATION ACCOUNT

7.1 Payments into the Class E Notes Principal Accumulation Account: the Transaction Account Bankshall credit, or procure the crediting of the Class E Notes Principal Accumulation Account on each PaymentDate during the Initial Period with the following:

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(a) the portion of the Income Available Funds to be credited to the Class E Notes PrincipalAccumulation Account in accordance with item (v) of the Pre-Enforcement Interest Priority ofPayment; and

(b) all interest paid from time to time on the credit balance of the Class E Notes Principal AccumulationAccount.

7.2 Withdrawals from the Class E Notes Principal Accumulation Account: one Business Day prior to theFirst Amortisation Payment Date, the Transaction Account Bank shall transfer the Class E Notes PrincipalAccumulated Funds to the Payments Account, such amounts shall be applied in repayment of principal of theClass E Notes on such Payment Date in accordance with Condition 5.2 (Pre-Enforcement Principal Priorityof Payments and use of the Class E Notes Principal Accumulation Funds).

The Class E Notes Principal Accumulation Account shall be closed following the Initial Period and amountspreviously credited thereto shall be applied in accordance with Condition 5.2 (Pre-Enforcement PrincipalPriority of Payments and use of the Class E Notes Principal Accumulation Funds).

SECURITIES ACCOUNT

The Eligible Investments represented by securities (including money market fund positions) from time totime owned by the Issuer pursuant to the Cash Management Agreement shall be deposited into the SecuritiesAccount. In accordance with the Deed of Charge, the Issuer shall create a charge over all such EligibleInvestments in favour of the Issuer Secured Creditors.

All amounts deriving from any Eligible Investment represented by securities purchased with amountsoriginally standing to the credit of the Investment Account and the Cash Reserve Account shall be paid into,respectively, the Investment Account and the Cash Reserve Account (as appropriate).

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TERMS AND CONDITIONS OF THE NOTES

Euro 211,950,000 Class A Mortgage Backed Floating Rate Notes due November 2054(ISIN Code: IT 0004304710 – Common Code 033716664)

Euro 15,900,000 Class B Mortgage Backed Floating Rate Notes due November 2054(ISIN Code: IT 0004304769 – Common Code 033717539)

Euro 11,550,000 Class C Mortgage Backed Floating Rate Notes due November 2054(ISIN Code: IT 0004304785 – Common Code 033717598)

Euro 7,200,000 Class D Mortgage Backed Floating Rate Notes due November 2054(ISIN Code: IT 0004304819 – Common Code 033717687)

Euro 10,300,000 Class E Mortgage Backed Floating Rate Notes due November 2054(ISIN Code: IT 0004304827 – Common Code 033717709)

Euro 3,950,000 Class Z Mortgage Backed Fixed Rate and Variable Return Notes due November 2054(ISIN Code: IT 0004304843)

GENERAL

The Euro 211,950,000 Class A Mortgage Backed Floating Rate Notes due November 2054, the Euro15,900,000 Class B Mortgage Backed Floating Rate Notes due November 2054, the Euro 11,550,000 ClassC Mortgage Backed Floating Rate Notes due November 2054, the Euro 7,200,000 Class D Mortgage BackedFloating Rate Notes due November 2054, the Euro 10,300,000 Class E Mortgage Backed Floating RateNotes due November 2054 and the Euro 3,950,000 Class Z Mortgage Backed Fixed Rate and VariableReturn Notes due November 2054 shall be issued on the Issue Date by the Issuer.

The Issuer is a company incorporated with limited liability under the laws of the Republic of Italy inaccordance with the Italian Securitisation Law, whose registered office is at via Eleonora Duse 53, Rome,Italy. The Issuer is registered in the register held by the Ufficio Italiano dei Cambi pursuant to the ItalianBanking Act under number 39050, in the special register of financial intermediaries held by the Bank of Italypursuant to Article 107 of the Italian Banking Act and in the register of enterprises held in Rome undernumber 09218951003. The Issuer shall issue the Notes pursuant to its by-laws for the purpose of financingthe purchase of the Initial Pool.

On or prior to the Issue Date, the Issuer shall publish the Prospectus, which shall constitute the “ProspettoInformativo” for the purposes of Article 2, paragraph 3 of the Italian Securitisation Law in respect of theNotes. Copies of the Prospectus will be available, upon request, to the holder of any Note during normalbusiness hours at the offices of the Paying Agents, the Representative of the Noteholders and the CorporateServicer.

This section headed “General” shall constitute an essential part of, and shall have the same force and effectas if it were set out in, the terms and conditions of the Notes set out below. The Notes contain summaries,and are subject to the detailed provisions, of the Transaction Documents.

The principal source of payment of amounts due and payable in respect of the Notes will be collections andrecoveries made in respect of the Initial Pool and any Additional Pool which may be purchased from time totime by the Issuer from the Originator pursuant to the Master Transfer Agreement and each PurchaseAgreement. In accordance with the provisions of the Italian Securitisation Law and Article 58 of the ItalianBanking Act as referred to in the Italian Securitisation Law, the Issuer has published in the Italian Official

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Gazette and filed with the Companies Register of Rome a notice of the transfer of the Loan Receivablescomprised in the Initial Pool.

The Purchase Price payable by the Issuer in respect of the Initial Pool shall be equal to the aggregateprincipal amount outstanding of the Loan Receivables comprised in the Initial Pool as at the Initial Cut-offDate. The consideration for the purchase of any Additional Pool which may be purchased by the Issuer fromthe Originator pursuant to the terms of the Master Transfer Agreement and the relevant Purchase Agreementshall be equal to the aggregate principal amount outstanding of the Loan Receivables comprised in suchAdditional Pool as at the relevant Cut-off Date.

Pursuant to the provisions of Article 3, paragraph 2 of the Italian Securitisation Law, the Portfolio issegregated by operation of Italian law from all other assets of the Issuer, and the Collections, once receivedby the Issuer, will only be available both prior to and following a winding-up of the Issuer to satisfy theobligations of the Issuer to the Noteholders, to pay taxes, costs, fees, liabilities or expenses due to theIssuer’s creditors under the Transaction Documents and to pay any other creditor of the Issuer in respect ofcosts, fees or expenses of the Issuer to such other creditor in relation to the securitisation of the Portfolioeffected by the Issuer via the issuance of the Notes.

Pursuant to the Rated Notes Subscription Agreement to be entered into on or about the Issue Date, betweenthe Issuer, the Representative of the Noteholders, the Arranger and the Lead Manager, the Lead Managershall agree to subscribe for the Rated Notes. Pursuant to the Class Z Notes Subscription Agreement enteredinto on or about the Issue Date between the Issuer, the Representative of the Noteholders and the Class ZNotes Subscriber, the Class Z Notes Subscriber shall agree to subscribe for the Class Z Notes. Under theSubscription Agreements, the Lead Manager and the Class Z Notes Subscriber, as the case may be, as initialsubscribers of the Notes of the relevant Class or Classes, will appoint Deutsche Trustee Company Limited asRepresentative of the Noteholders to perform, in their name and behalf and in the name and on behalf of allsubsequent Noteholders of the relevant Class, the activities described in these Conditions and the otherTransaction Documents and Deutsche Trustee Company Limited will accept such appointment.

Pursuant to the Master Transfer Agreement and each relevant Purchase Agreement, the Originator haswarranted and represented in respect of the Initial Pool, and will warrant and represent in respect of anyAdditional Pool, to the Issuer certain matters in relation to, inter alia, itself and each Pool, under the termsset out therein. The Master Transfer Agreement provides for certain remedies available to the Issuer inrespect of breaches of representation and warranty by the Originator.

Pursuant to the Servicing Agreement, between the Issuer and the Servicer, the Servicer has agreed toadminister, service and collect all cash payments in respect of the Portfolio on behalf of the Issuer. Thereceipt of the cash collections in respect of the Portfolio is the responsibility of the Servicer.

The Servicer shall ensure the proper segregation of the Issuer’s accounting and property from its ownactivities and the Servicer, as “soggetto incaricato della riscossione dei crediti e dei servizi di cassa epagamento”, shall be responsible for verifying that the transactions to be carried out in connection with theSecuritisation comply with applicable laws and are consistent with the contents of the Prospectus.

Pursuant to the Cash Management Agreement entered into on or about the Issue Date between the Issuer, theRepresentative of the Noteholders, the Calculation Agent, the Cash Manager and the Account Banks (i) theTransaction Account Bank has agreed to hold and operate the Issuer English Accounts and to provide theIssuer with account handling services in relation to monies or securities from time to time standing to thecredit of such accounts; (ii) the Italian Account Bank has agreed to hold and operate the Issuer ItalianAccounts and to provide the Issuer with account handling services in relation to moneys from time to timestanding to the credit of such accounts; (iii) the Cash Manager has agreed to invest moneys from time to timestanding to the credit of the Investment Account and the Cash Reserve Account in Eligible Investments; and(iv) the Calculation Agent has agreed to provide certain calculation, notification and reporting services to theIssuer.

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Pursuant to the terms of the Agency Agreement to be entered into on or about the Issue Date between theIssuer, the Representative of the Noteholders, the Italian Paying Agent and the Additional Paying Agent, theItalian Paying Agent and the Additional Paying Agent shall agree to provide certain agency and paymentservices to the Issuer in relation to the Notes. In particular, on each Payment Date, the Italian Paying Agentshall apply the amounts standing to the credit of the Payments Account in accordance with the relevantPriority of Payments and the Payments Report prepared by the Calculation Agent pursuant to the CashManagement Agreement and shall effect the payments of principal and interest in respect of the Notes ofeach Class.

Pursuant to the Interest Rate Swap Agreement to be entered into on or about the Issue Date between theIssuer, the Hedging Counterparty and the Representative of the Noteholders, the Issuer shall enter into aninterest rate swap to hedge the interest rate risk exposure of the Issuer in relation to its floating rate interestobligations under the Notes.

Pursuant to the Interest Rate Cap Agreement to be entered into on or around the Issue Date between theIssuer, the Hedging Counterparty and the Representative of the Noteholders, the Issuer will hedge againstpotential exposure arising from fluctuations in Euribor which may cause its floating interest rate obligationsunder the Rated Notes to exceed the rate of return generated by the Loans comprised in the Portfolio.Pursuant to the Corporate Services Agreement to be entered into on or about the Issue Date between theIssuer, the Corporate Servicer and the Representative of the Noteholders, the Corporate Servicer shall agreeto provide certain corporate administration and management services to the Issuer.

Pursuant to the Intercreditor Agreement to be entered into on or about the Issue Date, between, inter alia, theIssuer, the Originator, the Representative of the Noteholders (for itself and as representative of theNoteholders) and the Other Issuer Secured Creditors, the parties thereto shall agree the cash flow allocationof the proceeds in respect of the Portfolio, the rights of the Representative of the Noteholders to exercise theIssuer Security and the Representative of the Noteholders shall be granted certain rights in relation to thePortfolio. Under the terms of the Intercreditor Agreement, the Issuer shall, among other things grant amandate to the Representative of the Noteholders, pursuant to which, inter alia, following service of anIssuer Enforcement Notice or the occurrence of a Specified Event, the Representative of the Noteholdersshall be authorised under Article 1723, second paragraph, of the Italian Civil Code, to exercise, in the nameof the Issuer but in the interest and for the benefit of the Noteholders and the Other Issuer Secured Creditors,all the Issuer’s contractual rights arising out of the Transaction Documents to which the Issuer is a party andin respect of the Portfolio, including the right to sell it in whole or in part, in the interest of the Noteholdersand the Issuer Secured Creditors.

On the Issue Date, the Issuer shall credit an amount equal to the Cash Reserve Amount into the Cash ReserveAccount. If, on any Calculation Date, the Income Available Funds (with the exception of items (b), (c) and(d) thereof), are not sufficient to enable the Issuer to make payment for items (a) to (t) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated on such Calculation Date), the Issuer shall beentitled, on the immediately following Cash Reserve Drawdown Date, to draw on the Cash Reserve in anamount equal to the Cash Reserve Drawing Amount for application in accordance with the Pre-EnforcementInterest Priority of Payments to cover such shortfall.

Pursuant to the Liquidity Facility Agreement to be entered into on or about the Issue Date between theIssuer, the Liquidity Provider and the Representative of the Noteholders, the Liquidity Provider will providea 364 day committed facility in a maximum aggregate principal amount of the Liquidity Facility Amountwhich will be available to be drawn by the Issuer if, on any Calculation Date prior to the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event, the Income Available Funds (with theexception of items (c) and (d) thereof), are not sufficient to enable the Issuer to make payment for items (a)to (j) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated on such relevantCalculation Date).

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Pursuant to the Quotaholder and Undertakings Agreement between the Issuer and the Quotaholder, theQuotaholder (i) will assume certain undertakings with respect to, inter alia, the exercise of its voting rights inthe Issuer, and (ii) will undertake not to dispose of its interest in the Issuer.

Pursuant to the Italian-law governed Pledge Agreement to be entered into by the Issuer on or about the IssueDate, the Issuer shall, inter alia, pledge in favour of the Representative of the Noteholders for itself and forthe benefit of the Noteholders and the Other Issuer Secured Creditors all its rights (with the exclusion of itsrights in respect of the Portfolio and the relevant Collections) in respect of all monetary claims and rights andall the amounts payable from time to time to the Issuer pursuant to the Master Transfer Agreement and eachPurchase Agreement, the Subscription Agreements, the Servicing Agreement, the Intercreditor Agreement,the Corporate Services Agreement, the Liquidity Facility Agreement, the Quotaholder and UndertakingsAgreement, the Cash Management Agreement and the Agency Agreement.

Pursuant to the English law governed Deed of Charge executed by the Issuer on or about the Issue Date, theIssuer shall charge in favour of the Representative of the Noteholders to hold on trust for the benefit of itself,the Noteholders and the Other Issuer Secured Creditors all of the Issuer’s rights under the Interest Rate SwapAgreement and all sums of money standing to the credit of the Issuer English Accounts.

Subject to and in accordance with the provisions of the Cash Management Agreement and the IntercreditorAgreement, the Issuer has established and shall maintain (i) with the Transaction Account Bank, the IssuerEnglish Accounts, and (ii) with the Italian Account Bank, the Italian Issuer Accounts. The Issuer Accountsshall be operated subject to and in accordance with the provisions of the Cash Management Agreement andthe Intercreditor Agreement.

Copies of the Transaction Documents are available for inspection at the registered office of the CorporateServicer, Representative of the Noteholders and the Paying Agents.

The statements in these Conditions relating to the Notes include summaries of, and are subject to, thedetailed provisions of the Transaction Documents. No amendment of the provisions of these Conditions shallconstitute a novation (novazione) of the Notes within the meaning of Article 1230 of the Italian Civil Code.

The Noteholders are entitled to the benefit of, are bound by, and are deemed to have notice of all theprovisions of the Transaction Documents applicable to them. In particular, each Noteholder, by reason ofholding one or more Notes recognises the Representative of the Noteholders as its representative, acting inits name and on its behalf, and agrees to be bound by the terms of the Transaction Documents to which theRepresentative of the Noteholders is a party as if such Noteholder was itself a signatory thereto.

Unless the context otherwise requires, any reference in these Conditions to (a) any agreement or otherdocument shall be construed as a reference to the relevant agreement or document as the same may havebeen, or may from time to time be, replaced, extended, amended, varied, novated or assigned (ceduti),supplemented or superseded, (b) any law, statutory provision or legislative enactment shall be deemed also torefer to any re-enactment, modification or replacement thereof and any statutory instrument, order orregulation made thereunder or under any such re-enactment and (c) a person acting in a specified capacityshall include references to that person’s successors, permitted assignees, permitted transferees and anyfurther or other person and all persons deriving title under or through it and/or for the time being acting insuch capacity.

Headings used in these Conditions are for ease of reference only and shall not affect their interpretation.

1. DEFINITIONS

For the purposes of these Conditions, capitalised terms not otherwise defined herein shall, unless the contextotherwise requires, have the meanings given to them in the Glossary of Terms.

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2. FORM, DENOMINATION, TITLE

(a) The Notes are issued in denominations of Euro 50,000.

(b) The Notes are issued in dematerialised form (emesse in forma dematerializzata) on the terms of andsubject to these Conditions and will be held in such form on behalf of the Noteholders, untilredemption or cancellation thereof, by Monte Titoli for the account of the relevant Monte TitoliAccount Holders in accordance with Decree 213/98 and Resolution No. 11768. Monte Titoli shallact as depository for Clearstream and Euroclear.

(c) Except as ordered by a court of competent jurisdiction or as required by law, the Issuer, theRepresentative of the Noteholders and each of the Paying Agents shall (to the fullest extentpermitted by applicable laws) be entitled to treat the Monte Titoli Account Holder, whose account isat the relevant time credited with a Note, as the absolute owner of such Note for all purposes(whether or not such Note shall be overdue and notwithstanding any notice to the contrary, anynotice of ownership or writing thereon or notice of any previous loss or theft thereof or any interesttherein) and shall not be liable for doing so.

(d) Title to the Notes will at all times be evidenced by book-entries in accordance with the provisions ofDecree 213/98 and Resolution No. 11768. No certificate or physical document of title will be issuedin respect of the Notes. However, the Notes may be deemed for certain regulatory and fiscalpurposes to constitute “bearer” (al portatore) and not “registered” (nominativi) securities.

(e) The rights arising from the Security Documents in favour of the Noteholders which are incorporatedin each of the Notes are transferred together with the transfer of any Note at the time of transfer ofsuch Note. Each holder of any of the Notes from time to time will have the benefit of such rights.

(f) Ownership of the Notes by a United States person may be subject to United States tax lawrestrictions. Any United States person who holds this obligation will be subject to limitations underUnited States income tax laws, including the limitations provided in sections 165(j) and 1287(a) ofthe U.S. Internal Revenue Code.

3. STATUS, SEGREGATION AND SECURITY

(a) The Notes constitute direct and limited recourse obligations of the Issuer, giving rise to rights of theNoteholders that are (i) preferred over the proceeds of certain segregated assets of the Issuer relatingto the Securitisation (as set forth in more detail in paragraph (b) of this Condition 3), and (ii) securedover certain other assets of the Issuer relating to the Securitisation. Payments of interest, principaland any other amounts under the Notes will be funded solely from the proceeds of the Portfolio,together with such other amounts as the Issuer may derive from and in accordance with theTransaction Documents (together, the “Securitisation Assets”).

(b) By operation of the Italian Securitisation Law, the Portfolio and the Collections, when received bythe Issuer, are segregated (segregato) under Italian law from all other assets of the Issuer and willonly be available to satisfy the obligations of the Issuer to the Noteholders, the Issuer SecuredCreditors and Connected Third Party Creditors in the order of priority set out in these Conditions,subject to the terms of the Intercreditor Agreement. In addition, the rights of the Noteholders and theOther Issuer Secured Creditors are secured over certain other assets of the Issuer relating to theSecuritisation pursuant to the Security Documents.

(c) The Notes of each Class will at all times rank pari passu without preference or priority amongstthemselves.

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The rights of the Noteholders in respect of priority of payment of interest and principal are set out inCondition 5 (Order of Priority) and are subject to the provisions of the Intercreditor Agreement.Payments in respect of the Notes are subordinated to certain prior ranking amounts due from theIssuer as set out in Condition 5 (Order of Priority) and are subject to the provisions of theIntercreditor Agreement.

If prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent the Pro rata Amortisation Conditions are not met in respect of repayment of principal: (i) theClass A Notes will rank pari passu and pro rata without any preference or priority amongthemselves and in priority to the Class B Notes, the Class C Notes, the Class D Notes, the Class ENotes and the Class Z Notes; (ii) the Class B Notes will rank pari passu and pro rata without anypreference or priority among themselves and in priority to the Class C Notes, the Class D Notes, theClass E Notes and the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class C Noteswill rank pari passu and pro rata without any preference or priority among themselves and inpriority to the Class D Notes, the Class E Notes and the Class Z Notes, but subordinated to the ClassA Notes and the Class B Notes; (iv) the Class D Notes will rank pari passu and pro rata without anypreference or priority among themselves and in priority to the Class E Note and the Class Z Notes,but subordinated to the Class A Notes, the Class B Notes, the Class C Notes; (v) the Class E Noteswill rank pari passu and pro rata without any preference or priority among themselves and inpriority to the Class Z Notes, but subordinated to the Class A Notes, the Class B Notes, the Class CNotes and the Class D Notes; (vi) the Class Z Notes will rank pari passu and pro rata without anypreference or priority among themselves and subordinated to the Class A Notes, the Class B Notes,the Class C Notes, the Class D Notes and the Class E Notes.

If prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent the Pro rata Amortisation Conditions are met on any Calculation Date, then on theimmediately following Payment Date, the Class A Notes, the Class B Notes, the Class C Notes, theClass D Notes and the Class E Notes will rank pari passu and pro rata without any preference orpriority among themselves in respect of repayment of principal under the terms set out inCondition 5.2, whilst the Class Z Notes will rank pari passu and pro rata without preference ofpriority among themselves and subordinated in respect of repayment of principal to the Rated Notesof all Classes (Order of Priority – Pre-Enforcement Principal Priority of Payments).

In respect of the obligation of the Issuer to pay interest on the Notes, prior to the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event, (i) the Class A Notes will rankpari passu and pro rata among themselves and in priority to the Class B Notes, the Class C Notes,the Class D Notes, the Class E Notes and the Class Z Notes; (ii) the Class B Notes will rank paripassu and pro rata among themselves and in priority to the Class C Notes, the Class D Notes, theClass E Notes and the Class Z Notes, but subordinated to the Class A Notes; (iii) the Class C Noteswill rank pari passu and pro rata among themselves and in priority to the Class D Notes, the Class ENotes and the Class Z Notes, but subordinated to the Class A Notes and the Class B Notes; (iv) theClass D Notes will rank pari passu and pro rata among themselves and in priority to the Class ENotes and the Class Z Notes, but subordinated to the Class A Notes, the Class B Notes and the ClassC Notes; (v) the Class E Notes will rank pari passu and pro rata among themselves and in priority tothe Class Z Notes, but subordinated to the Class A Notes, the Class B Notes, the Class C Notes andthe Class D Notes; (vi) the Class Z Notes will rank pari passu and pro rata among themselves butsubordinated to the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes under the terms set out in Condition 5.1 (Order of Priority – Pre-Enforcement InterestPriority of Payments).

Following the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent, (i) the Class A Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal and in priority to

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the Class B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes forall purposes; (ii) the Class B Notes will rank pari passu and pro rata without any preference orpriority among themselves in respect of payments of interest and of repayment of principal and inpriority to the Class C Notes, the Class D Notes, the Class E Notes and the Class Z Notes for allpurposes, but subordinated to the Class A Notes; (iii) the Class C Notes will rank pari passu and prorata without any preference or priority among themselves in respect of payments of interest and ofrepayment of principal and in priority to the Class D Notes, the Class E Notes and the Class Z Notesfor all purposes, but subordinated to the Class A Notes and the Class B Notes; (iv) the Class D Noteswill rank pari passu and pro rata without any preference or priority among themselves in respect ofpayments of interest and of repayment of principal and in priority to the Class E Notes and the ClassZ Notes for all purposes, but subordinated to the Class A Notes, the Class B Notes, the Class CNotes; (v) the Class E Notes will rank pari passu and pro rata without any preference or priorityamong themselves in respect of payments of interest and of repayment of principal in priority to theClass Z Notes for all purposes, but subordinated to the Class A Notes, the Class B Notes, the Class CNotes and the Class D Notes; (vi) the Class Z Notes will rank pari passu and pro rata without anypreference or priority among themselves for all purposes and subordinated to the Class A Notes, theClass B Notes, the Class C Notes, the Class D Notes and the Class E Notes, under the terms set outin Condition 5.5 (Order of Priority –Enforcement Priority of Payments).

(d) The Representative of the Noteholders may, in its absolute discretion, at any time and withoutprejudice to Condition 13(a)(D) (Meetings of Noteholders – General), or Condition 14 (a)(Representative of the Noteholders) and having regard to the particular circumstances thenapplicable, convene a Meeting or Meetings of a specific Class or Classes of Noteholders.

(e) The rights, claims and remedies of the Noteholders of each Class and of each Other Issuer SecuredCreditor in respect of the obligations owed by the Issuer to the Noteholders of such Class and eachsuch Other Issuer Secured Creditor, as the case may be, in respect of the Issuer Security, thePortfolio and any other Securitisation Assets shall at all times (whether before or after the service ofan Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event) be subordinated tothe rights, claims and remedies of all the Noteholders, all Other Issuer Secured Creditors and allConnected Third Party Creditors whose rights, claims and remedies in respect of (i) the obligationsowed by the Issuer to such creditor(s) and/or (ii) the Issuer Security and/or (iii) the Portfolio and/or(iv) the other Securitisation Assets rank by operation of law or are expressed pursuant to theseConditions or the Intercreditor Agreement to rank in priority to the rights, claims and remedies of theNoteholders of such Class and/or of such Other Issuer Secured Creditor, as the case may be.Furthermore, each Noteholder and each Other Issuer Secured Creditor agrees and acknowledges thatuntil all sums required by these Conditions and the terms of the Intercreditor Agreement to be paid inpriority thereto have been paid or discharged in full (and then if and only to the extent that the Issuershall have funds available to pay such amounts and shall be permitted to pay such amounts inaccordance with these Conditions and the terms of the Intercreditor Agreement together with allother amounts payable pari passu therewith), no amount payable by the Issuer to any Noteholder orany Other Issuer Secured Creditor under these Conditions or under any other Transaction Documentshall be capable of becoming payable, nor shall it be paid or discharged to it.

4. COVENANTS

Subject to the proviso below and without prejudice to Condition 7(d) (Redemption, Purchase andCancellation – Early redemption by the Issuer), for so long as any amount remains outstanding in respect ofthe Notes of any Class, the Issuer, save with the prior written consent of the Representative of theNoteholders, or as expressly provided in these Conditions or in any of the Transaction Documents, shall not(to the extent permitted by Italian law), nor shall cause or permit quotaholders’ meetings to be convened inorder to:

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(a) Negative pledge and non-disposal

create or permit to subsist any Security Interest of any kind (unless arising by operation of law) overany of the Issuer Security, the Portfolio, or the other Securitisation Assets or any other of its rightsunder the Transaction Documents or sell, lend, or otherwise dispose of all or any part of the IssuerSecurity, the Portfolio or the other Securitisation Assets or any other of its rights under theTransaction Documents;

(b) Use of property

use, invest, sell, transfer, exchange, factor, assign, lease, hire out, lend or dispose of, or otherwisedeal with, any of the Issuer Security, the Portfolio, or the other Securitisation Assets or any other ofits rights under the Transaction Documents or any interest, right or benefit in respect of any thereofor grant any option or right to acquire the same or agree or attempt or purport to do any of the same;

(c) Restrictions on activities

(i) without prejudice to the proviso below, engage in any activity whatsoever which is notincidental to or necessary in connection with any of the activities which the TransactionDocuments (or the transaction documents in relation to any subsequent issue of debtsecurities by it and/or the terms and conditions relating thereto) provide for, or envisage thatthe Issuer may engage in, or any other activity necessary in connection therewith orincidental thereto;

(ii) have any subsidiary or affiliate (società controllata or società collegata within the meaningof Article 2359 of the Italian Civil Code) participations in other companies, or undertakingsof any other nature or have any employees or premises; or

(iii) at any time approve or agree or consent to any act or thing whatsoever which in the opinionof the Representative of the Noteholders would be reasonably likely to materially prejudicethe interests of the Noteholders or any Class thereof under the Notes or the TransactionDocuments or do, or permit to be done, any act or thing in relation thereto which in theopinion of the Representative of the Noteholders would be reasonably likely to materiallyprejudice the interests of the Noteholders or any Class under the Transaction Documents;

(d) Dividends and distributions

pay any dividend or make any other distribution or repayment to its Quotaholder, issue any furtherquotas or otherwise increase its equity capital other than when so required by applicable law;

(e) Borrowings

without prejudice to the proviso below, create, incur or permit to subsist any Indebtednesswhatsoever in respect of borrowed money whatsoever or give any guarantee or indemnity or becomeobliged in respect of Indebtedness or of any obligation of any person;

(f) Merger

amalgamate, consolidate or merge with any other person or convey or transfer its properties or assetssubstantially or in their entirety to any other person;

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(g) No variation or waiver

permit (i) any of the Transaction Documents to which it is a party to become invalid or ineffective;(ii) the priority of the Issuer Security to be amended, released, postponed or discharged or consent toany variation of, or exercise any powers of consent or waiver pursuant to the terms of, any suchTransaction Documents; or (iii) any party to any of such Transaction Documents or any other personwhose obligations form part of the Issuer Security to be released from its obligations;

(h) Bank accounts

without prejudice to the proviso below, have an interest in any bank account other than the IssuerAccounts and, if opened, the Liquidity Reserve Account, unless that account or interest is charged byway of security on terms acceptable to the Representative of the Noteholders (or the Representativeof the Noteholders has waived such requirement);

(i) Statutory documents

amend, supplement or otherwise modify its deed of incorporation (atto costitutivo) and/or by-laws(statuto) other than when so required by applicable law or by any regulatory authority havingjurisdiction over it;

(j) Separateness

permit or consent to any of the following occurring:

(i) its books and records relating to the Securitisation being maintained with or co-mingled withthose of any other person or entity;

(ii) its bank accounts relating to the Securitisation and the debts represented thereby being co-mingled with those of any other person or entity;

(iii) its assets or revenues relating to the Securitisation being co-mingled with those of any otherperson or entity; or

(iv) its business being conducted other than in its own name;

and, in addition and without limitation to the above, the Issuer shall or shall procure that, withrespect to itself:

(A) separate financial statements in relation to its financial affairs and the Securitisation aremaintained;

(B) all corporate formalities with respect to its affairs are observed in compliance with theItalian Securitisation Law;

(C) separate stationery, invoices and cheques are used in respect of the Securitisation;

(D) it always holds itself out as a separate entity; and

(E) any known misunderstandings regarding its separate identity;

(k) Compliance with applicable law

cease to comply with any applicable law or any necessary corporate formality;

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(l) Residency and centre of main interests

become resident, including without limitation for tax purposes, in any country outside Italy or ceaseto be managed and administered in Italy or cease to have its centre of main interests in Italy,

provided that nothing in this Condition 4 (Covenants) shall prevent or restrict the Issuer from:

(i) carrying out any activity which is incidental to maintaining its corporate existence andcomplying with laws and regulations applicable to it;

(ii) entering into Further Securitisations comprising, specifically, issuing further debt securities(“Further Notes”), acquiring further receivables or portfolios of receivables of any kindpursuant to the Securitisation Law (including by granting loans pursuant to Article 7 thereof)(“Further Portfolios” the securitisation of which being a “Further Securitisations”) andentering into agreements and transactions relating thereto, including the opening or operatingof bank accounts in connection therewith (“Further Transactions”) financed or to befinanced by the issue of Further Notes and in respect of which security may be granted oversuch Further Portfolios and/or any right, benefit, agreement, instrument, document or otherasset of the Issuer relating thereto or to such Further Transactions to secure such FurtherNotes and/or the rights of any person in connection with such Further Transactions(“Further Security”), provided that:

(A) the Issuer confirms in writing to the Representative of the Noteholders that such FurtherSecurity (if any) is constituted separately from the security constituted by the IssuerSecurity and does not include or comprise any asset over or in respect of which securityis constituted by the Issuer Security Documents or otherwise relating to theSecuritisation;

(B) the Issuer confirms in writing to the Representative of the Noteholders that the termsand conditions of such Further Notes contain provisions to the effect that theobligations of the Issuer whether in respect of interest, principal, premium or otheramounts in respect of such Further Notes, are limited recourse obligations of the Issuer,limited to some or all of the assets of the Issuer comprised within the relevant FurtherPortfolio and/or secured by the relevant Further Security (if any) and/or relating to theFurther Transaction and that the terms and conditions of such Further Notes containlimitations on the right of the holders of such Further Notes to take action against theIssuer, including in respect of Insolvency Proceedings relating to the Issuer, comparable(although not necessarily identical) to those contained in the Intercreditor Agreementand these Conditions;

(C) the Issuer confirms in writing to the Representative of the Noteholders that each personwhich is a party to any transaction document in connection with such FurtherTransaction has agreed that the obligations of the Issuer to such party are limitedrecourse obligations, limited to some or all of the assets of the Issuer comprised withinthe relevant Further Portfolio and/or secured by the relevant Further Security (if any)and/or relating to the Further Transaction and has agreed to limitations on its right totake action against the Issuer, including in respect of insolvency proceedings relating tothe Issuer comparable (although not necessarily identical) to those contained in theIntercreditor Agreement; and

(D) (i) the Rating Agencies have been informed of such Further Securitisation and haveconfirmed to the Representative of the Noteholders that any such Further Securitisationwould not adversely affect the then current rating of the Rated Notes of any Class, and(ii) the Noteholders of the Most Senior Class of Notes have been informed of such

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Further Securitisation and have given their prior written consent to the implementationthereof.

5. ORDER OF PRIORITY

5.1 Pre-Enforcement Interest Priority of Payments

Prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, andsubject to Condition 5.4 (Order of Priority – Payments to Connected Third Party Creditors) andCondition 5.5 (Order of Priority – Application of Funds – Enforcement Priority of Payments), the Issuershall, on each Payment Date and, in the case of item (e) below, on the Swap Payment Date and Interest RateCap Payment Date immediately preceding such Payment Date and on the basis of computations to be madeby the Calculation Agent on the immediately preceding Calculation Date, apply or procure the application ofthe Income Available Funds in the following order of priority, in each case, only if and to the extent thatpayments (or retentions of sums) of a higher priority have been made in full:

(a) first, in or towards satisfaction, pari passu and pro rata according to the respective amounts thereof,of (A) payment of the Quarterly Maintenance Amount then to be paid by the Issuer into theExpenses Account; (B) any costs, expenses, fees, taxes or other amounts incurred by the Issuer inconnection with the Securitisation and required to preserve the Issuer’s corporate existence andmaintain it in good standing or to be paid by any applicable law to any Connected Third PartyCreditor (together with any interest and any VAT thereon), to the extent that any such cost orexpense cannot be met from the amounts standing to the credit of the Expenses Account; and (C) anyand all outstanding fees, costs, expenses and taxes required to be paid in connection with the listing,deposit or ratings of the Notes, or any notice to be given to the Noteholders or any other party to aTransaction Document (together with any interest and any VAT thereon as provided for therein);

(b) second, in or towards satisfaction of the fees, costs and expenses of, and all other amounts due andpayable to, the Representative of the Noteholders for its own account accrued in respect of theCalculation Period immediately preceding such Payment Date;

(c) third, pari passu and pro rata according to the respective amounts thereof, in or towards satisfaction,of the fees, costs and expenses of, and all other amounts due and payable pursuant to the TransactionDocuments (together with any interest and any VAT thereon as provided for therein) to any of (A)the Paying Agents; (B) the Transaction Account Bank, the Italian Account Bank, the CalculationAgent and the Cash Manager; (C) the Corporate Servicer and the Sole Director, accrued in respect ofthe Calculation Period immediately preceding such Payment Date; and (D) the Servicer and theSpecial Servicer (if appointed) accrued in respect of the Collection Period immediately precedingsuch Payment Date;

(d) fourth, in or towards payment of all amounts due and payable to the Liquidity Provider pursuant tothe Liquidity Facility Agreement (other than the Liquidity Subordinated Amount);

(e) fifth, pari passu and pro rata in or towards satisfaction of the amounts (other than any HedgingDefault Termination Amount) due and payable to the Hedging Counterparty under the HedgingAgreements;

(f) sixth, pari passu and pro rata according to the respective amounts thereof, in or towards satisfactionof all interest due and payable on the Class A Notes as at such Payment Date;

(g) seventh, provided that a Class B Credit Trigger Event has not occurred, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class B Notes as at such Payment Date;

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(h) eighth, provided that a Class C Credit Trigger Event has not occurred, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class C Notes as at such Payment Date;

(i) ninth, provided that a Class D Credit Trigger Event has not occurred, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class D Notes as at such Payment Date;

(j) tenth, provided that a Class E Credit Trigger Event has not occurred, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class E Notes as at such Payment Date;

(k) eleventh, to transfer to the Investment Account an amount equal to the amount (if any) required toreduce to zero the debit balance (if any) of the Class A Principal Deficiency Sub-Ledger as at theCalculation Date immediately preceding such Payment Date;

(l) twelfth, to transfer to the Investment Account an amount equal to the amount (if any) required toreduce to zero the debit balance (if any) of the Class B Principal Deficiency Sub-Ledger as at theCalculation Date immediately preceding such Payment Date;

(m) thirteenth, to transfer to the Investment Account an amount equal to the amount (if any) required toreduce to zero the debit balance (if any) of the Class C Principal Deficiency Sub-Ledger as at theCalculation Date immediately preceding such Payment Date;

(n) fourteenth, to transfer to the Investment Account an amount equal to the amount (if any) required toreduce to zero the debit balance (if any) of the Class D Principal Deficiency Sub-Ledger as at theCalculation Date immediately preceding such Payment Date;

(o) fifteenth, to transfer to the Investment Account an amount equal to the amount (if any) required toreduce to zero the debit balance (if any) of the Class E Principal Deficiency Sub-Ledger as at theCalculation Date immediately preceding such Payment Date;

(p) sixteenth, in or towards increasing the Principal Available Funds in an amount equal to the InterestShortfall Amount (if any) covered by using the Principal Available Funds on the preceding PaymentDate(s);

(q) seventeenth, following the occurrence of a Class B Credit Trigger Event, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class B Notes as at such Payment Date;

(r) eighteenth, following the occurrence of a Class C Credit Trigger Event, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class C Notes as at such Payment Date;

(s) nineteenth, following the occurrence of a Class D Credit Trigger Event, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class D Notes as at such Payment Date;

(t) twentieth, following the occurrence of a Class E Credit Trigger Event, pari passu and pro rataaccording to the respective amounts thereof, in or towards satisfaction of all interest due and payableon the Class E Notes as at such Payment Date;

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(u) twenty-first, for so long as any Rated Note remains outstanding, to transfer to the Cash ReserveAccount an amount equal to the amount (if any) by which the Cash Reserve Required Amountexceeds the Cash Reserve Balance;

(v) twenty-second, on any Payment Date which occurs before the expiry of the Initial Period, to credit anamount equal to 50% of the remaining Income Available Funds to the Class E Notes PrincipalAccumulation Account;

(w) twenty-third, to pay on the First Amortisation Payment Date and any other Payment Date fallingafter the expiry of the Initial Period, pari passu and pro rata, the principal amount outstanding inrespect of the Class E Notes by using an amount equal to 50% of the remaining Income AvailableFunds;

(z) twenty-fourth, to pay (i) any Liquidity Subordinated Amount, and (ii) pari passu and pro rataaccording to their respective amounts, in or towards satisfaction, of any amount due and payable toany party to a Transaction Document to the extent such amount is not satisfied pursuant to an itemranking higher in priority hereto;

(aa) twenty-fifth, pari passu and pro rata in or towards satisfaction of any Hedging Default TerminationAmounts due and payable to the Hedging Counterparty under any of the Hedging Agreements;

(bb) twenty-sixth, to pay pari passu and pro rata according to the respective amounts thereof, in ortowards satisfaction of all interest due and payable on the Class Z Notes as at such Payment Date;and

(cc) twenty-seventh, to pay the Variable Return due and payable on the Class Z Notes as at such PaymentDate.

5.2 Pre-Enforcement Principal Priority of Payments and use of the Class E Notes PrincipalAccumulation Funds

Subject to Condition 5.4 (Order of Priority – Payments to Connected Third Party Creditors) andCondition 5.5 (Order of Priority – Application of Funds – Enforcement Priority of Payments) and on thebasis of computations to be made by the Calculation Agent on the immediately preceding Calculation Date,the Issuer shall:

(A) on the First Amortisation Payment Date, apply or procure the application of the Class E NotesPrincipal Accumulated Funds towards repayment of the Principal Amount Outstanding of the ClassE Notes; and

(B) on each Payment Date, apply or procure the application of the Principal Available Funds against thefollowing payments (if due on such date) or against retention of the following sums, in the followingorder of priority, in each case, only if and to the extent that payments (or retentions of sums) of ahigher priority have been made in full:

(a) first, in or towards increasing the Income Available Funds in an amount equal to cover theInterest Shortfall Amount (if any) on such Payment Date;

(b) second, on any Payment Date which occurs during the Revolving Period:

(A) if an Additional Pool was purchased by the Issuer from the Originator on theimmediately preceding Transfer Date:

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(i) in the event that the Payment Conditions in respect of such Additional Pooloccurred on or prior to such Payment Date, in or towards payment on suchPayment Date of the Purchase Price payable in respect of such Additional Pooland further retention of the remaining Principal Available Funds in the PrincipalReserve Account; or

(ii) in the event that the Payment Conditions in respect of such Additional Pool havenot occurred as of such Payment Date, in or towards retention in the InvestmentAccount of an amount equal to the Purchase Price payable for such AdditionalPool, to be applied on the next following date on which such PaymentConditions will be satisfied, and further retention of the remaining PrincipalAvailable Funds in the Principal Reserve Account; and

(B) if no Additional Pool was purchased by the Issuer, in or towards the retention of thePrincipal Available Funds in the Principal Reserve Account;

(c) third, on the First Amortisation Payment Date and any other Payment Date falling after theexpiry of the Initial Period, if the Pro rata Amortisation Conditions are satisfied on theimmediately preceding Calculation Date, to pay, pari passu and pro rata according to thePrincipal Amount Outstanding of each Class of Notes on such Payment Date, all amountsoutstanding in respect of principal on (i) the Class A Notes, (ii) the Class B Notes, (iii) theClass C Notes, (iv) the Class D Notes, and (v) the Class E Notes;

(d) fourth, if the Pro rata Amortisation Conditions are not satisfied on the immediatelypreceding Calculation Date, to pay, pari passu and pro rata, all amounts outstanding inrespect of principal on the Class A Notes until the Class A Notes are redeemed in full;

(d) fifth, if the Pro rata Amortisation Conditions are not satisfied on the immediately precedingCalculation Date, to pay, pari passu and pro rata, all amounts outstanding in respect ofprincipal on the Class B Notes, until the Class B Notes are redeemed in full;

(e) sixth, if the Pro rata Amortisation Conditions are not satisfied on the immediately precedingCalculation Date, to pay, pari passu and pro rata, all amounts outstanding in respect ofprincipal on the Class C Notes, until the Class C Notes are redeemed in full;

(f) seventh, if the Pro rata Amortisation Conditions are not satisfied on the immediatelypreceding Calculation Date, to pay, pari passu and pro rata, all amounts outstanding inrespect of principal on the Class D Notes, until the Class D Notes are redeemed in full;

(g) eighth, if the Pro rata Amortisation Conditions are not satisfied on the immediatelypreceding Calculation Date, to pay, pari passu and pro rata, all amounts outstanding inrespect of principal on the Class E Notes, until the Class E Notes are redeemed in full;

(h) ninth, once the Rated Notes have been redeemed in full, pari passu and pro rata, all amountsoutstanding in respect of principal on the Class Z Notes, up to euro 10,000;

(i) tenth, to apply pursuant to the Pre-Enforcement Interest Priority of Payment any remainingamount of the Principal Available Funds after all the above items having been paid in full;and

(j) eleventh, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the remaining portion of the Principal Amount Outstandingof the Class Z Notes.

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5.3 Pre-Enforcement Principal Deficiency Sub-Ledger

On each Calculation Date the Issuer shall enter, or procure to be entered as a debit, the principal amount ofeach Loan Receivable in the Portfolio arising from Loans which have been classified as Defaulted LoanReceivables during the immediately preceding Collection Period:

(a) up to the then aggregate Principal Amount Outstanding of the Class E Notes, on the Class EPrincipal Deficiency Sub-Ledger; and/or

(b) thereafter, up to the then aggregate Principal Amount Outstanding of the Class D Notes, on the ClassD Principal Deficiency Sub-Ledger; and/or

(c) thereafter, up to the then aggregate Principal Amount Outstanding of the Class C Notes, on the ClassC Principal Deficiency Sub-Ledger; and/or

(d) thereafter, up to the then Principal Amount Outstanding of the Class B Notes, on the Class BPrincipal Deficiency Sub-Ledger; and/or

(e) thereafter, up to the then Principal Amount Outstanding of the Class A Notes, on the Class APrincipal Deficiency Sub-Ledger,

as the case may be, in each case taking into account any amount previously entered as a debit on the relevantPrincipal Deficiency Sub-Ledger and in respect of which funds have not yet been allocated in accordancewith the Pre-Enforcement Interest Priority of Payments.

5.4 Payments to Connected Third Party Creditors

Notwithstanding the obligation of the Issuer to apply the Available Funds to pay and/or provide for the itemsset out in the applicable Priority of Payments in the order of priority and on the dates set out therein, theIssuer (or, as the case may be, the Calculation Agent acting on its behalf) may at any time apply the amountsstanding to the credit of the Issuer Collection Account in priority to, or pari passu with, any item set out inthe Pre-Enforcement Interest Priority of Payments in order to pay, when required by applicable law, anyamount payable (but not provided for) under item (a)(B) of the Pre-Enforcement Interest Priority ofPayments.

To the extent that on any date on which the Issuer is required to pay any such amounts, the funds available tothe Issuer would otherwise be insufficient for such purpose, the Cash Manager may liquidate the EligibleInvestments held in the Securities Account (purchased with amounts originally standing to the credit of theInvestment Account), and/or apply any Principal Receipts, and/or the amounts standing to the credit of theInvestment Account in priority to, or pari passu with, any item set out in the Pre-Enforcement PrincipalPriority of Payments to pay the amount of the shortfall.

5.5 Enforcement Priority of Payments

Following service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event or in theevent of the early redemption of the Notes in accordance with Conditions 7(d) (Redemption, Purchase andCancellation – Early redemption by the Issuer) or 7(e) (Redemption of the Notes at the option of Put OptionNoteholders), the Issuer shall, on the first Business Day of each calendar month or on the relevant PaymentDate or Put Date, as applicable, apply or procure the application of all amounts received or recovered by itand/or the Representative of the Noteholders in respect of the Portfolio and/or the Issuer Security and/or theother Securitisation Assets or the Available Funds or Redemption Funds, as the case may be, as follows, ineach case, only if and to the extent that payments of a higher priority have been made in full:

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(a) first, pari passu and pro rata according to the respective amounts thereof, in or towards satisfaction,of (A) any winding-up costs due but unpaid (together with any VAT thereon); (B) any costs,expenses, fees, taxes or other amounts incurred by the Issuer in connection with the Securitisationand required to be paid by any applicable law to any Connected Third Party Creditor (together withany interest and any VAT thereon), to the extent any such cost or expense cannot be met from theamounts standing to the credit of the Expenses Account; and (C) any and all outstanding fees, costs,expenses and taxes required to be paid in connection with the listing, deposit or ratings of the Notes,or any notice to be given to the Noteholders or any other party to a Transaction Document (togetherwith any interest and any VAT thereon as provided for therein);

(b) second, in or towards satisfaction of the fees, costs and expenses of, and all other amounts due butunpaid to, the Representative of the Noteholders for its own account at such date;

(c) third, pari passu and pro rata according to the respective amounts thereof, in or towards satisfaction,of the fees, costs and expenses of, and all other amounts due but unpaid pursuant to the TransactionDocuments (together with any interest and any VAT thereon as provided for therein) to any of (A)the Paying Agents; (B) the Transaction Account Bank, the Italian Account Bank, the CalculationAgent and the Cash Manager; (C) the Corporate Servicer and the Sole Director; and (D) the Servicerand the Special Servicer (if appointed), in each case, at such date;

(d) fourth, in or towards payment of all amounts due but unpaid to the Liquidity Provider pursuant to theLiquidity Facility Agreement (other than the Liquidity Subordinated Amount);

(e) fifth, pari passu and pro rata, in or towards payment of all amounts due but unpaid to the HedgingCounterparty (other than any Hedging Default Termination Amount) under any of the HedgingAgreements at such date;

(f) sixth, pari passu and pro rata according to the respective amounts thereof, in or towards satisfactionof all interest due but unpaid on the Class A Notes;

(g) seventh, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the Principal Amount Outstanding of the Class A Notes at such dateuntil the Class A Notes are redeemed in full (or, on a Put Date, at their Redemption Value);

(h) eighth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of all interest due but unpaid on the Class B Notes as at such date;

(i) ninth, pari passu and pro rata according to the respective amounts thereof, in or towards satisfactionof the repayment of the Principal Amount Outstanding of the Class B Notes at such date until theClass B Notes are redeemed in full (or, on a Put Date, at their Redemption Value);

(j) tenth, pari passu and pro rata according to the respective amounts thereof, in or towards satisfactionof all interest due but unpaid on the Class C Notes as at such date;

(k) eleventh, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the Principal Amount Outstanding of the Class C Notes at such dateuntil the Class C Notes are redeemed in full (or, on a Put Date, at their Redemption Value);

(l) twelfth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of all interest due but unpaid on the Class D Notes as at such date;

(m) thirteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the Principal Amount Outstanding of the Class D Notes at such dateuntil the Class D Notes are redeemed in full (or, on a Put Date, at their Redemption Value);

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(n) fourteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of all interest due but unpaid on the Class E Notes as at such date;

(o) fifteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the Principal Amount Outstanding of the Class E Notes at such dateuntil the Class E Notes are redeemed in full (or, on a Put Date, at their Redemption Value);

(p) sixteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction, of all amounts due but unpaid to the Lead Manager and the Arranger in connection withthe Subscription Agreements;

(q) seventeenth, pari passu and pro rata according to their respective amounts, in or towards satisfactionof the remaining balance of any amount due but unpaid in respect of any amount set out at item (z)of the Pre-Enforcement Interest Priority of Payments;

(r) eighteenth, pari passu and pro rata, in or towards satisfaction of any Hedging Default TerminationAmount due but unpaid to the Hedging Counterparty under any of the Hedging Agreements;

(s) eighteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of all interest due but unpaid on the Class Z Notes at such date;

(t) nineteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of all amounts outstanding in respect of principal on the Class Z Notes,up to euro 10,000;

(u) twelfth, to pay the Variable Return on the Class Z Notes at such date; and

(v) thirteenth, pari passu and pro rata according to the respective amounts thereof, in or towardssatisfaction of the repayment of the remaining portion of the Principal Amount Outstanding of theClass Z Notes.

5.6 Deferral under the applicable Priority of Payments

Without prejudice to the provisions contained in these Conditions relating to payments in respect of theNotes (including Clause 6(g) (Right to Interest – Interest Deferral)), in the event and to the extent that theaggregate funds available to the Issuer in accordance with the provisions of the applicable Priority ofPayments are insufficient to pay any amount due and payable on any Payment Date in accordance with suchPriority of Payments, such shortfall will not be payable on that Payment Date but will be deferred andbecome payable on the next succeeding Payment Date if and to the extent that the aggregate funds thenavailable to the Issuer in accordance with the applicable Priority of Payments are sufficient to pay suchamount. No interest will be payable on any amount so deferred.

6. RIGHT TO INTEREST

(a) Right to interest, Payment Dates and Interest Periods

Each Note bears interest on its Principal Amount Outstanding (as defined in Condition 7(b)(Redemption, Purchase and Cancellation – Mandatory pro rata redemption in whole or in part))from (and including) the Issue Date. Subject as provided in Condition 6(g) (Right to Interest –Interest Deferral), interest in respect of each Note shall fall due and be payable (subject towithholding for or on account of tax (if any)) in Euro in arrear on each Payment Date in an amountequal to the Interest Payment Amount (as defined in Condition 6(c)(ii) (Right to Interest –Determination of Rates of Interest and calculation of Interest Payment Amount)). The first PaymentDate shall be the Payment Date falling in May 2008 in respect of the first Interest Period.

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Interest in respect of any Interest Period or any other period will be calculated on the basis of theactual number of days elapsed and a 360-day year.

Interest shall only cease to accrue on any part of the Principal Amount Outstanding of any of theNotes of each Class from (and including) the due date for redemption of such part unless payment ofprincipal due and payable but unpaid is improperly withheld or refused, whereupon, subject only toCondition 7(a) (Redemption, Purchase and Cancellation – Final Redemption), interest shall continueto accrue on such principal (after as well as before judgment) at the rate from time to time applicableto the Note of the relevant Class until the moneys in respect thereof have been received by the ItalianPaying Agent on behalf of the relevant Noteholders and notice to that effect is given in accordancewith Condition 16 (Notice to Noteholders).

(b) Rate of Interest

The rate of interest payable from time to time in respect of the Notes (the “Rate of Interest”) will bedetermined by the Calculation Agent two Business Days prior to each Payment Date in respect of theInterest Period commencing on that date (save in respect of the first Interest Period, where the Rateof Interest will be determined by the Calculation Agent two TARGET Settlement Days immediatelyprior to the Issue Date) subject to the Modified Following Business Day Convention (each an“Interest Determination Date”).

With respect to each Interest Period, the Rate of Interest applicable to each Class of Rated Notesshall be the aggregate of the Relevant Margin for such Class of Notes; and “Euribor”, being:

(i) the arithmetic mean of the offered quotations to leading banks (rounded to four decimalplaces with the mid-point rounded up) for 3 (three) month Euro deposits (or, in the case ofthe first Interest Period, the linear interpolation of the arithmetic mean between 4-month and5-month Euro deposits) in the Euro-zone Inter-bank market which appears on Reuters page“EURIBOR01” (or (aa) such other page as may replace that page, or (bb) if that serviceceases to display such information, such page as displays such information on an equivalentservice, in each case, the “Screen Rate”) at or about 11.00 a.m. (Central European Time) onthe relevant Interest Determination Date; or

(ii) if the Screen Rate is unavailable at such time for 3 (three) month Euro deposits, then the ratefor the relevant Interest Period shall be the arithmetic mean (rounded to four decimal placeswith the mid-point rounded up) of the rates notified to the Calculation Agent at its request byeach of the Reference Banks as the rate at which 3 (three) month Euro deposits in arepresentative amount are offered by that Reference Bank to leading banks in the Euro-zoneinter-bank market at or about 11.00 a.m. (Central European Time) on the relevant InterestDetermination Date. If on any such Interest Determination Date at least, two only of theReference Banks provide such offered quotations to the Cash Manger the relevant rate shallbe determined, as aforesaid, on the basis of the offered quotations of those Reference Banksproviding such quotations. If, on any such Interest Determination Date, only one of theReference Banks provides the Calculation Agent with such an offered quotation, theCalculation Agent shall forthwith consult with the Representative of the Noteholders and theIssuer for the purposes of agreeing one additional bank to provide such a quotation orquotations to the Calculation Agent (which bank is in the opinion of the Representative ofthe Noteholders suitable for such purpose) and the rate for the Interest Period in questionshall be determined, as aforesaid, on the basis of the offered quotations of such banks as areso agreed. If no such bank or banks is or are so agreed or such bank or banks as so agreeddoes or do not provide such a quotation or quotations, then the rate for the relevant InterestPeriod shall be the rate in effect for the last preceding Interest Period to which sub-paragraph (A) of this Condition 6(b) (Right to Interests – Rate of Interest) shall haveapplied.

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For the purpose of these Conditions, the “Relevant Margin” shall be:

(i) in respect of the Class A Notes, 0.60 per cent. per annum;

(ii) in respect of the Class B Notes, 0.90 per cent. per annum;

(iii) in respect of the Class C Notes, 1.35 per cent. per annum;

(iv) in respect of the Class D Notes, 3.25 per cent. per annum; and

(v) in respect of the Class E Notes, 3.75 per cent. per annum;

To the extent permitted by law, there shall be no maximum or minimum Rate of Interest in respect ofthe Rated Notes.

With respect to each Interest Period, the Rate of Interest applicable to the Class Z Notes shall be 2per cent. per annum.

(c) Determination of Rates of Interest and calculation of Interest Payment Amount

The Calculation Agent shall, on each Interest Determination Date, determine:

(i) the Rate of Interest applicable to the Interest Period beginning on the Payment Dateimmediately following such Interest Determination Date (or in the case of the first InterestPeriod, beginning on and including the Issue Date) in respect of each Class of Rated Notes;

(ii) the amount of interest in euros payable on each Note of each Class (the “Interest PaymentAmount”) and on the aggregate number of Notes of each Class (the “Aggregate InterestPayment Amount”) in each case, in respect of such Interest Period. The Interest PaymentAmount payable on each such Note in respect of any Interest Period shall be calculated by(A) applying the relevant Rate of Interest to the Principal Amount Outstanding of that Noteon the relevant Payment Date (or, in the case of the first Interest Period, the Issue Date) atthe commencement of such Interest Period (after deducting therefrom any Principal Paymentdue on that Payment Date (whether or not paid)); (B) multiplying the product of suchcalculation by the actual number of days in the relevant Interest Period; (C) dividing thatamount by 360; and (D) rounding the resulting amount downward to the nearest cent. TheAggregate Interest Payment Amount shall be calculated by multiplying the Interest PaymentAmount of each Note of each such Class by the actual number of Notes of that Class.

(d) Publication of the Rate of Interest, Interest Payment Amount, Aggregate Interest PaymentAmount and Payment Date

The Calculation Agent will cause (A) the Rate of Interest; (B) the Interest Payment Amount; (C) theAggregate Interest Payment Amount; and (D) the relevant Payment Date to be notified promptlyafter determination thereof (and in any event by no later than the first day of the relevant InterestPeriod), to the Issuer, the Representative of the Noteholders, the Cash Manager, the Paying Agents,the Hedging Counterparty, the Hedging Calculation Agent, Liquidity Provider, Monte Titoli, and, forso long as that Class of Rated Notes are listed on the Irish Stock Exchange will cause the same to bepublished in accordance with Condition 16 (Notice to Noteholders) on or as soon as possible afterthe relevant Interest Determination Date. The Interest Payment Amount, Aggregate Interest PaymentAmount and Payment Date so published may subsequently be amended (or appropriate alternativearrangements made by way of adjustment) without notice in the event of an extension or shorteningof the Interest Period or in the event of manifest error.

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(e) Determination or calculation by Representative of the Noteholders

If the Calculation Agent or the Issuer, as the case may be, does not at any time for any reasondetermine the Rate of Interest and/or calculate the Interest Payment Amount or Aggregate InterestPayment Amount for one or more Classes of Notes in accordance with the foregoing provisions ofthis Condition 6 (Right to Interest), the Representative of the Noteholders shall:

(i) determine the Rate of Interest for the relevant Class of Notes at such rate as (having regardto the procedure described above) it shall consider fair and reasonable pursuant to Article1349, first paragraph, of the Italian Civil Code in all the circumstances; and

(ii) calculate the Interest Payment Amount for the relevant Class of Notes in the mannerspecified in Condition 6(c) (Right to Interest – Determination of Rates of Interest andcalculation of Interest Payment Amount) and publish, as required, the amounts specified inaccordance with Condition 6(d) Right to Interest – Publication of the Rate of Interest,Interest Payment Amount, Aggregate Interest Payment Amount and Payment Date).

Any such determination and/or calculation shall be deemed to have been made by the CalculationAgent or the Issuer, as the case may be.

(f) Reference Banks and Calculation Agent

The Issuer shall ensure that, so long as any of the Notes remains outstanding, there shall at all timesbe three “Reference Banks” and a Calculation Agent. The initial Reference Banks shall be theprincipal London office of each of Barclays Bank plc, Lloyds TSB Bank, HSBC Bank plc. In theevent of the principal London office of any such bank being unable or unwilling to continue to act asa Reference Bank, the Issuer shall appoint such other bank as may have been previously approved inwriting by the Representative of the Noteholders to act as such in its place. The Calculation Agentmay resign by giving 90 days’ written notice to the Issuer in accordance with the Cash ManagementAgreement. The Issuer shall be obliged to appoint a relevant replacement prior to such resignationbecoming effective. The appointment of any replacement shall be subject to the prior approval of theRepresentative of the Noteholders. The Issuer shall procure that any change in the identity of theCalculation Agent will be published as soon as reasonably practicable in accordance withCondition 16 (Notice to Noteholders).

(g) Interest deferral

Payments of interest on the Class or Classes of Notes other than the Most Senior Class of Notes thenoutstanding will be subject to deferral (i) to the extent that there are insufficient Issuer AvailableFunds on any Payment Date in accordance with the relevant Priority of Payments to pay in full theamount of interest which would otherwise be payable on the Class or Classes of Notes other than theMost Senior Class of Notes then outstanding or (ii) following a Credit Trigger Event. The amount bywhich the aggregate amount of interest paid on each Class of Notes on any Payment Date inaccordance with this Condition 6 (Right to Interests) falls short of the aggregate amount of interestwhich otherwise would be payable on the relevant Notes on that date shall be aggregated with theamount of, and treated for the purposes of, this Condition 6 (Right to Interests) as if it were interestdue on each such Class of Notes and, subject as provided below, payable on the next succeedingPayment Date.

If, on the Maturity Date (or on any earlier redemption of the relevant Class of Notes in full), thereremains any such shortfall, the amount of such shortfall will become due and payable on theMaturity Date (or, in the case of any earlier redemption of the relevant Class of Notes in full, on thedate of such earlier redemption) subject in each case to the amounts of Available Funds.

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(h) Variable Return

Subject to the provisions of these Conditions, each holder of a Class Z Note shall be entitled on eachPayment Date to a pro rata share of the aggregate amount (if any) available under the applicablePriority of Payments to be paid as Variable Return, calculated by multiplying such aggregate amountby a fraction, the numerator of which is the then Principal Amount Outstanding of each such Class ZNote held by such Noteholder and the denominator of which is the then aggregate Principal AmountOutstanding of all the Class Z Notes (and rounding the result down to the nearest Euro centaccording to the rules of Monte Titoli).

7. REDEMPTION, PURCHASE AND CANCELLATION

(a) Final redemption

Unless previously redeemed in full as provided in this Condition 7 (Redemption, Purchase andCancellation), the Issuer shall (subject to and in accordance with the relevant Priority of Paymentsand Condition 7(h) (Redemption, Purchase and Cancellation – Cancellation) according to the rulesof Monte Titoli) redeem the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes,the Class E Notes and the Class Z Notes at their Principal Amount Outstanding on the Payment Datefalling in November 2054 (the “Maturity Date”). All Notes will, immediately following theMaturity Date, be deemed to be discharged in full and any amount in respect of principal, interest orother amounts due and payable in respect of the Notes will (unless payment of any such amounts isimproperly withheld or refused) be finally and definitively cancelled.

The Issuer may not redeem the Notes of any Class in whole or in part prior to the Maturity Dateexcept as provided below in Conditions 7(b) (Redemption, Purchase and Cancellation – Mandatorypro rata redemption in whole or in part), 7(c) (Redemption, Purchase and Cancellation –Redemption for Tax or Regulatory Event), or 7(d) (Redemption, Purchase and Cancellation – Earlyredemption by the Issuer), but this shall be without prejudice to Condition 12 (Enforcement).

(b) Mandatory pro rata redemption in whole or in part

(i) If, on any Payment Date following expiry of the Initial Period, the Issuer has AvailableFunds that are available for the purpose, it shall apply the same on such date in accordancewith Condition 5.1 (Order of Priority – Pre-Enforcement Interest Priority of Payments) orCondition 5.2 (Order of Priority – Pre-Enforcement Principal Priority of Payments),respectively.

(ii) Except following the service of an Issuer Enforcement Notice or the occurrence of an IssuerInsolvency Event, prior to the expiry of the Initial Period, no Available Funds will beapplied by the Issuer in redeeming the Notes. During the Initial Period, on each PaymentDate, however, the Issuer shall transfer or cause to be transferred to the Principal ReserveAccount – subject to payments of items (A) and (B) (included) of Condition 5.2 (Order ofPriority – Pre-Enforcement Principal Priority of Payments) (if any) – the PrincipalAvailable Funds (taking into account all the amounts credited for such purpose on theprevious Payment Dates and not applied as above) (the “Potential Capital Funds”).

On each Calculation Date during the Initial Period, in the event that an Interest ShortfallAmount is envisaged to occur on the immediately following Payment Date, the CalculationAgent, on behalf of the Issuer and under the terms set out in the Intercreditor Agreement,shall apply all or part of the Potential Capital Funds to pay such Interest Shortfall Amountby using a corresponding amount standing to the credit of the Investment Account.

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(iii) The Issuer shall give or cause to be given, not less than 2 (two) Business Days prior to therelevant Payment Date, notice of any redemption under Condition 7(b)(i) (Redemption,Purchase and Cancellation – Mandatory pro rata redemption in whole or in part) above andthe pro rata amount thereof to the Representative of the Noteholders and the Noteholders inaccordance with Condition 16 (Notice to Noteholders).

(iv) The principal amount redeemable on any Payment Date under Condition 7(b)(i)(Redemption, Purchase and Cancellation – Mandatory pro rata redemption in whole or inpart) above in respect of each Note of each Class (the “Principal Payment”) shall be a prorata share of the Available Capital Funds of the relevant Class of Notes on such date,calculated by multiplying the Available Capital Funds of the relevant Class of Notes on suchdate by a fraction, the numerator of which is the then Principal Amount Outstanding of eachNote of such Class of Notes and the denominator of which is the then aggregate PrincipalAmount Outstanding of all the Notes of the same Class of Notes (and rounding the resultdown to the nearest cent), provided always that no such Principal Payment may exceed thePrincipal Amount Outstanding of the relevant Note. The “Principal Amount Outstanding”of a Note on any date shall be the principal amount of such Note upon issue less theaggregate amount of all repayments of principal that have been made prior to such date inrespect of that Note.

(c) Redemption for Tax or Regulatory Event

(i) Subject as provided in this Condition 7(c) (Redemption, Purchase and Cancellation –Redemption for Tax or Regulatory Event), prior to the service of an Issuer EnforcementNotice or the occurrence of an Issuer Insolvency Event, the Issuer shall redeem at its optionall, but not some only of, the Notes (or the Rated Notes, as applicable) at their PrincipalAmount Outstanding (plus any accrued but unpaid interest) in accordance with theEnforcement Priority of Payments and subject to the Issuer having sufficient funds toredeem either (i) all the Notes and to make all payments ranking in priority thereto, or paripassu therewith, or (ii) the Rated Notes and to make all payments ranking in priority thereto,or pari passu therewith, but not the Class Z Notes, and the Class Z Noteholders haveconsented to such redemption if, by reason of a change in the laws of the Republic of Italy orthe interpretation or administrative practice in respect thereof since the Issue Date:

(A) the patrimonio separato of the Issuer in respect of the Securitisation becomes subject totaxes, duties, assessments or governmental charges of whatever nature imposed, levied,collected, withheld or assessed by the Republic of Italy or any political sub-divisionthereof or any authority thereof or therein or any applicable taxing authority havingjurisdiction;

(B) either the Issuer or any Paying Agent appointed in respect of the Notes or any custodianof the Notes is required to deduct or withhold any amount (other than in respect of aLaw 239 Withholding) in respect of any Class of Notes, from any payment of principalor interest on such Payment Date for or on account of any present or future taxes,duties, assessments or governmental charges of whatever nature imposed, levied,collected, withheld or assessed by the Republic of Italy or any political sub-divisionthereof or any authority thereof or therein or any other applicable taxing authorityhaving jurisdiction and provided that such deduction or withholding may not beavoided by appointing a replacement Paying Agent or custodian in respect of the Notesbefore the Payment Date following the change in law or the interpretation oradministration thereof; or

(C) any amounts of interest payable on the Loans to the Issuer are required to be deductedor withheld from the Issuer for or on account of any present or future taxes, duties,

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assessments or governmental charges of whatever nature imposed, levied, collected,withheld or assessed by the Republic of Italy or any political sub-division thereof orany authority thereof or therein or any other applicable taxing authority havingjurisdiction;

(D) it is or will become unlawful for the Issuer to perform any of its material obligationsunder or in respect of the Notes or any of the Transaction Documents to which it is aparty,

each such event, a “Tax or Regulatory Event”.

(ii) The Issuer’s right to redeem in the manner described above shall be subject to:

(A) it giving not more than 60 nor less than 30 days’ written notice (which notice shall beirrevocable) to the Representative of the Noteholders and the Noteholders, pursuant toCondition 16 (Notice to Noteholders), of its intention to redeem all, but not some only,of the Notes (or the Rated Notes, but not the Class Z Notes, and the Class ZNoteholders have consented to such redemption) on the next succeeding Payment Dateat their Principal Amount Outstanding together with interest accrued to but excludingthe date of such redemption; and

(B) it providing to the Representative of the Noteholders:

(1) a legal opinion (in form and substance satisfactory to the Representative of theNoteholders) from a firm of lawyers of international reputation (approved inwriting by the Representative of the Noteholders) opining on the relevant changein, or amendment to, the laws or regulations or the relevant change in the officialinterpretation of the laws or regulations thereof;

(2) a certificate from the chairman of the board of directors or the sole director of theIssuer (as applicable) stating that the obligation to make such deduction orwithholding or the suffering by the Issuer of such deduction or withholding cannotbe avoided or, as the case may be, the events under Condition 7(c)(i)(A) or (D)above (Redemption, Purchase and Cancellation – Redemption for Tax orRegulatory Event) will apply on the next Payment Date and cannot be avoided bythe Issuer taking reasonable measures available to it; and

(3) a certificate from the chairman of the board of directors or the sole director of theIssuer (as applicable) to the effect that it will have the funds on such Payment Dateto discharge its obligations under: (i) the Notes and any obligations ranking inpriority thereto, or pari passu therewith, together with any additional taxes payableby the Issuer by reason of such early redemption of the Notes; or (ii) the RatedNotes and any obligations ranking in priority thereto, or pari passu therewith, butnot the Class Z Notes, and the Class Z Noteholders have consented to suchredemption;

(4) it (i) having obtained from the purchaser of the Portfolio a certificate of goodstanding from the competent companies’ register, a solvency certificate and acertificate confirming the absence of insolvency proceedings from the bankruptcycourt or equivalent jurisdictional body in the country of incorporation of thepurchaser, and (ii) having obtained, or otherwise having used its best efforts toobtain, a certificate confirming that the sale price of the Portfolio corresponds tothe then market value thereof.

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(iii) The Issuer (and the Representative of the Noteholders acting in the name and on behalf ofthe Issuer) is entitled, pursuant to the Intercreditor Agreement, to dispose of the Portfolio inorder to finance the redemption of the Notes (or the Rated Notes only, provided that theClass Z Noteholders have consented to such redemption) in the circumstances describedabove. The Issuer shall apply the proceeds of the sale of the Portfolio and all other AvailableFunds in or towards redeeming the Notes (or the Rated Notes, as applicable) together withall interest accrued thereon subject to and in accordance with Condition 5.5 (Order ofPriority – Enforcement Priority of Payments).

(d) Early redemption by the Issuer

Prior to the delivery of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent, at any time after the later of the expiry of the Initial Period and the Payment Date on whichthe aggregate principal amount outstanding of the Portfolio is equal to or less than 10% of the InitialPrincipal Amount of the Portfolio, the Issuer may redeem all, but not some only of, the Notes (or theRated Notes in full and the Class Z Notes as applicable, provided that the Class Z Noteholders haveconsented to such redemption) at their Principal Amount Outstanding (plus any accrued but unpaidinterest) in accordance with the Enforcement Priority of Payments, provided that:

(i) the net amount to be received by the Issuer from the sale of the Portfolio (i) is not subject toany Security Interest (other than Issuer Security); and (ii) (together with the AvailableFunds) is at least sufficient to redeem in full (i) all the Notes and to make all paymentsranking in priority thereto, or pari passu therewith, or (ii) the Rated Notes and to make allpayments ranking in priority thereto, or pari passu therewith, but not the Class Z Notes, andthe Class Z Noteholders have consented to such redemption, on the next succeedingPayment Date following the exercise of the repurchase obligation;

(ii) the Issuer shall have certified and produced evidence acceptable to the Representative of theNoteholders as to the sufficiency of the net proceeds of sale of the Portfolio for the purposesof paragraph (i) above; and, in each case:

(iii) the Issuer (i) has obtained from the purchaser of the Portfolio a certificate of good standingfrom the competent companies’ register, a solvency certificate and a certificate confirmingthe absence of insolvency proceedings from the bankruptcy court or equivalent jurisdictionalbody in the country of incorporation of the purchaser, and (ii) has obtained an independentthird party’s appraisal certifying that the sale price of the Portfolio corresponds to the thenmarket value thereof.

The Issuer shall apply the proceeds of such sale of the Portfolio in or towards redemption of all theNotes (or the Rated Notes, as applicable) and give not more than 60 nor less than 30 days’ priornotice in writing to the Representative of the Noteholders and to the Noteholders in accordance withCondition 16 (Notice to Noteholders) of the redemption of the Notes of each relevant Class subjectto and in accordance with Condition 5.5 (Order of Priority – Enforcement Priority of Payments).

(e) Redemption of the Notes at the option of Put Option Noteholders

(i) Prior to the service of an Issuer Enforcement Notice or the occurrence of an IssuerInsolvency Event and provided that the Class A Sub-Ledger Condition was satisfied as at theCalculation Date immediately preceding the most recent Payment Date, each Put OptionNoteholder shall have the option (a “Put Option”) to offer all (but not only part of) the PutOption Notes held by it to the Issuer for redemption at their Redemption Value on thePayment Date falling in February 2015 (the “First Put Date”) and each Payment Datethereafter (such Payment Date and the First Put Date, each being a “Put Date”) in

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accordance with the following provisions. The Class E Noteholders and the Class ZNoteholders will not have the right to exercise the Put Option.

(ii) If the Class A Sub-Ledger Condition was satisfied as at the Calculation Date immediatelypreceding the most recent Payment Date and the Put Option has been validly exercised inaccordance with paragraph (iv) below, then the Issuer will be obliged, subject to theavailability of sufficient Redemption Funds, to redeem the Notes at their Redemption Valueon the next following Put Date(as applicable) (subject to the conditions being set out inparagraph (viii) below being satisfied).

(iii) On or before the seventy-fifth (75th) day prior to each Put Date (as applicable), the Issuershall notify the Put Option Noteholders and the Representative of the Noteholders inaccordance with Condition 16 (Notice to Noteholders), by sending a notice containing thefollowing information (the “Put Option Information Notice”):

(A) whether the Class A Sub-Ledger Condition was met as at the Calculation Dateimmediately preceding the most recent Payment Date;

(B) the assumed remaining average life of each Class of Put Option Notes if the PutOption is not exercised, re-calculated as at such date;

(C) provided that the Class A Sub-Ledger Condition was met as at the Calculation Dateimmediately preceding the most recent Payment Date, the right of each Put OptionNoteholder to exercise the Put Option under the terms set out in the Conditions;

(D) the requirement to give a Put Option Exercise Notice (as defined below) no laterthan by close of business on the sixtieth (60th) day prior to such Put Date (unlesssuch day is not a Business Day, in which case the immediately preceding BusinessDay) if the Put Option Noteholder wishes to exercise the Put Option; and

(E) the circumstance that, if a Put Option Quorum has sent one or more Put OptionExercise Notices in accordance with paragraph (D) above, the Issuer, subject to theavailability of sufficient Redemption Funds, will redeem the Notes at theirRedemption Value on such Put Date(as the case may be).

(iv) The Put Option shall be deemed to have been exercised by each Put Option Noteholder on aPut Date if (A) the Class A Sub-Ledger Condition was met as at the Calculation Dateimmediately preceding the most recent Payment Date, and (B) a Put Option Quorum hasdelivered to the Issuer, with copy to the Representative of the Noteholders and theCalculation Agent, at any time during normal business hours of the Issuer within a period ofnot less than sixty (60) days (unless such sixtieth (60th) day is not a Business Day, in whichcase the immediately preceding day) and not more than seventy-five (75) days prior to suchPut Date (the “Put Notice Period”), a duly signed notice (bearing attached a certificate ofthe custodian of such Put Option Note(s) evidencing the title of such Put Option Noteholderto the relevant Put Option Note(s)) stating that it wishes to exercise the Put Option (the “PutOption Exercise Notice”).

(v) Any Put Option Exercise Notice given by any Put Option Noteholder shall be irrevocable. Ifprior to a Put Date an Event of Default or an Issuer Insolvency Event shall have occurredand be continuing, all Put Option Noteholders shall be deemed not to have delivered one ormore Put Option Exercise Notices pursuant to paragraph (iv) and the Notes shall forthwithbecome due and payable pursuant to Condition 5.5 (Order of Priority – EnforcementPriority of Payments).

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(vi) Within 5 (five) Business Days from the expiry of the Put Notice Period, the Issuer, or theCalculation Agent on its behalf, will notify the Noteholders, the Representative of theNoteholders and the Paying Agents in accordance with Condition 16 (Notice to theNoteholders) whether it has received one or more Put Option Exercise Notices from a PutOption Quorum and consequently whether the Put Option has been or is deemed to havebeen validly exercised by the Put Option Noteholders (the “Put Option Outcome Notice”).

(vii) If (A) the Class A Sub-Ledger Condition was not met as at the Calculation Date immediatelypreceding the most recent Payment Date, or (B) the Put Option Quorum has not sent one ormore Put Option Exercise Notices in accordance with paragraph (iv) above, no Put OptionSale Procedure (as defined below) will take place, the Notes will not be redeemed at theirRedemption Value on a Put Date and payments on the Notes will continue to be made inaccordance with the Priority of Payments.

(viii) If, in respect of a Put Date (A) the Class A Sub-Ledger Condition was met as at theCalculation Date immediately preceding the most recent Payment Date, and (B) the PutOption Quorum has sent one or more Put Option Exercise Notices in accordance withparagraph (iv) above, then the Put Option will be deemed to have been validly exercised byall Put Option Noteholders in accordance with paragraph (iv) above, the Issuer shall use itsendeavours to sell the Portfolio pursuant to a Put Option Sale Procedure under the terms setout in paragraph (ix) below, and subject to the following conditions being met:

(A) the Redemption Funds being at least sufficient to redeem the Notes at their RedemptionValue and to make all payments ranking in priority thereto, or pari passu therewith, onsuch Put Date in accordance with Condition 5.5 (Order of Priority – EnforcementPriority of Payments); and

(B) the Issuer having certified and produced evidence acceptable to the Representative ofthe Noteholders as to the sufficiency of the Redemption Funds for the purposes ofparagraph (A) above; and

(C) the Issuer having obtained from the purchaser(s) of the Portfolio (or any portionthereof) a certificate of good standing from the competent companies’ register, asolvency certificate and a certificate confirming the absence of insolvency proceedingsfrom the bankruptcy court or equivalent jurisdictional body in the country ofincorporation of the purchaser,

the Notes will be redeemed at their respective Redemption Value on such Put Date, and theIssuer shall apply the Redemption Funds in or towards redeeming the Notes together with allinterest accrued thereon subject to and in accordance with Condition 5.5 (Order of Priority –Enforcement Priority of Payments).

(ix) In the period commencing on the date of delivery of a Put Option Outcome Noticeconfirming the valid exercise of the Put Option and ending on the Calculation Dateimmediately preceding the relevant Put Date, both excluded (the “Put Option SalePeriod”), the Issuer shall use its best endeavours to dispose (in the manner and pursuant tothe procedure it deems fit) of the Portfolio to one or more third parties (other than theOriginator and companies belonging to the Deutsche Bank S.p.A. banking group(collectively, the “DB S.p.A. Group Entities”)) in accordance with paragraph (x) below(the “Put Option Sale Procedure”), in order to finance the redemption of the Notes at theRedemption Value on the relevant Put Date, pursuant to the terms set out in thisCondition 7(e) (Redemption of the Notes at the option of Put Option Noteholders). TheIssuer will only transfer title to the Portfolio or any part thereof against both receipt from the

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relevant purchaser of the purchase price therefor and following satisfaction of the conditionsreferred to in paragraph (viii) above.

(x) The Issuer shall be entitled to sell (i) the Loan Receivables comprised in the Portfolio whichare not Defaulted Loan Receivables at a price not lower than the aggregate of their thenprincipal amount outstanding and the interest accrued thereon at the rate set out in therelevant Loan Agreements, and (ii) the Defaulted Loan Receivables then comprised in thePortfolio (if any) at a price not lower than the market value thereof, as determined andcertified in writing to the Issuer and the Representative of the Noteholders by a financialinstitution or auditing firm with considerable experience in the Italian non-performing loansmarket – being independent from the Originator, the Originator’s group, each Other IssuerSecured Creditor and the Deutsche Bank AG group – selected by the Issuer subject to theconsent of the Representative of the Noteholders. Deutsche Bank A.G., either directly orthrough a different entity appointed by it (other than the DB S.p.A. Group Entities) shall ineach case have a pre-emption right in connection with each sale of the Portfolio or anyportion thereof. Deutsche Bank A.G. will be entitled to exercise such pre-emption rightwithin fifteen (15) Business Days from the commencement of the Put Option Sale Period.

(xi) In the event that, as a result of the failure to dispose of the Portfolio during the Put OptionSale Period or because any of the conditions set out in paragraph (viii) above would not besatisfied, the Issuer does not have sufficient Redemption Funds to redeem the Notes at theirRedemption Value on a Put Date, this will not constitute an Event of Default. In such case,payments on the Notes will continue to be made in accordance with the Priority of Paymentsas if no Put Option had been exercised. The Issuer shall be entitled to carry out one or morefurther Put Option Sale Procedures before any subsequent Put Date until the Issuer receivesnet proceeds of such Put Option Sale Procedure such to enable it to redeem the Notes at theirRedemption Value on the subsequent Put Option Date in accordance with this Condition 5.5(Order of Priority – Enforcement Priority of Payments).

(xii) By purchasing the relevant Notes, each Noteholder expressly acknowledges and agrees that,notwithstanding any other provision of these Conditions, the principal amount payable onredemption of each Note on a Put Date following the exercise of the Put Option shall belimited to the relevant Redemption Value as at such date. If the Redemption Value of a Noteof any Class on a Put Date is less than the then Principal Amount Outstanding of such Note,the balance of the Principal Amount Outstanding in respect of the that Note shall cease to bedue and payable and shall be definitively cancelled and the holder of that Note shall have nofurther claim against the Issuer for the excess.

(f) Available Funds, Principal Payments, Principal Amount Outstanding

On each Calculation Date, the Issuer shall determine or shall cause to be determined by theCalculation Agent the amounts to be calculated in respect of the Notes under these Conditions,including:

(i) the amount of Potential Capital Funds and Available Capital Funds (as the case may be);

(ii) the Principal Payment (if any) due on the next following Payment Date in respect of eachNote of each Class;

(iii) the Principal Amount Outstanding of each Note of each Class on the next followingPayment Date (after deducting any Principal Payment due to be made on that PaymentDate); and

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(iv) in case of exercise of the Put Option in accordance with Condition 7(e) (Redemption of theNotes at the option of the Put Option Noteholders), if the Put Option Quorum has beenreached and the amount of the Redemption Value and of the Redemption Funds.

Each determination by or on behalf of the Issuer in respect of the amount of Available CapitalFunds, any Principal Payment and the Principal Amount Outstanding shall in each case (in theabsence of manifest error) be final and binding on all persons.

The Issuer will, on each Calculation Date beginning with the Calculation Date which occursimmediately prior to the First Amortisation Payment Date, cause each determination of a PrincipalPayment (if any) and the Principal Amount Outstanding to be notified forthwith by the CalculationAgent to the Representative of the Noteholders, the Paying Agents and (for so long as the RatedNotes of any Class are listed on the Irish Stock Exchange) the Irish Stock Exchange and will causenotice of each determination of a Principal Payment and the Principal Amount Outstanding to begiven in accordance with Condition 16 (Notice to Noteholders). If no Principal Payment is due to bemade on any Class of Notes on any Payment Date following the First Amortisation Payment Date, anotice to this effect will be given by the Issuer to the Noteholders of the relevant Class in accordancewith Condition 16 (Notice to Noteholders).

If the Issuer or the Calculation Agent does not at any time for any reason determine the AvailableCapital Funds, a Principal Payment or the Principal Amount Outstanding in respect of any Class ofNotes in accordance with the preceding provisions of this paragraph, such Available Capital Funds,Principal Payment and/or Principal Amount Outstanding shall be determined by the Representativeof the Noteholders (or, without prejudice to the Representative of the Noteholders’ obligation tomake such determination, such other person as it may instruct for this purpose) in accordance withthis paragraph and each such determination or calculation shall be deemed to have been made by theIssuer and shall in each case (in the absence of manifest error) be final and binding on all persons.

(g) Notice of redemption

Any such notice as is referred to in Conditions 7(b) (Redemption, Purchase and Cancellation –Mandatory pro rata redemption in whole or in part), 7(c) (Redemption, Purchase and Cancellation– Redemption for Tax or Regulatory Event), 7(d) (Redemption, Purchase and Cancellation – Earlyredemption by the Issuer) or 7(e) (Redemption of the Notes at the option of Put Option Noteholders)above shall (i) be published in accordance with Condition 16 (Notice to Noteholders) and (ii) beirrevocable and, upon the expiration of such notice, the Issuer shall be bound to redeem the Notes ofthe relevant Class at amounts specified in this Condition 7 (Redemption, Purchase andCancellation).

(h) No purchase by Issuer

The Issuer may not purchase any of the Notes.

(i) Cancellation

All Notes redeemed in full will be cancelled upon redemption and may not be resold or re-issued.

8. PAYMENTS

(a) Payment of principal and interest in respect of the Notes will be credited, according to theinstructions of Monte Titoli, by the Italian Paying Agent on behalf of the Issuer to an account in thename of Monte Titoli who will then credit the accounts of those Monte Titoli Account Holderswhose accounts with Monte Titoli are credited with those Notes and thereafter credited by suchMonte Titoli Account Holders to the accounts of the beneficial owners of those Notes or through

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Euroclear and Clearstream to the accounts with Euroclear and Clearstream of the beneficial ownersof those Notes, in accordance with the rules and procedures of Monte Titoli, Euroclear orClearstream, as the case may be. The Issuer shall be deemed to have discharged its paymentobligations in respect of the Notes pro tanto to the extent of payments made by it or on its behalf inaccordance with the instructions of Monte Titoli to an account in the name of Monte Titoli.

(b) Payments of principal and interest in respect of the Notes are subject in all cases to any fiscal orother laws and regulations applicable thereto. The Issuer undertakes, in the event any lawimplementing or complying with, or introduced in order to conform to, Council Directive2003/48/EC of 3 June 2003, relating to the taxation of savings income in the form of interestpayments (the “Directive”) is adopted in the Member State of the European Union where the interestpayments arise, to ensure that it maintains an agent in such a Member State that will not be obligedto withhold or deduct tax pursuant to such Directive or law.

(c) Payments under the Notes may or may not be subject to withholding for or on account of tax, inaccordance with Law 239. Upon the occurrence of any withholding for or on account of tax fromany payments under the Notes, neither the Issuer nor any other person shall have any obligation topay any additional amount(s) to any holder of a Note of any Class.

(d) If the due date for payment of any amount of interest or principal in respect of any Note is not a localbusiness day in a relevant jurisdiction, then the relevant Noteholder will not be entitled to paymentuntil the immediately succeeding local business day and no further payments of additional amountsby way of interest, principal or otherwise shall be due in respect of such Note.

In this Condition 8 (Payments), the expression “local business day” means a day (other than a Saturday or aSunday or a public holiday) (i) on which banks are generally open for business to the public in the placewhere the Specified Office of any Monte Titoli Account Holder is located and, in the case of payment bytransfer to an account maintained by the payee in a different place, in such place; and (ii) which is a BusinessDay.

9. TAXATION

All payments in respect of the Notes will be made without withholding or deduction for or on account of anytaxes of whatsoever nature other than a Law 239 Withholding or any other withholding or deduction that theIssuer or any of the other parties to the Transaction Documents is required to make by applicable law. If anywithholding or deduction is required by law to be withheld or deducted, (including without limitation a Law239 Withholding), the Issuer or the relevant Monte Titoli Account Holder (as the case may be) shallwithhold or deduct the required amount and account to the proper authorities for the amount withheld ordeducted. Neither the Issuer nor any Paying Agent shall be obliged to pay any additional amount to anyNoteholder on account of such withholding or deduction.

10. STATUTE OF LIMITATIONS

Claims against the Issuer for payments in respect of the Notes shall be prescribed and become void unlessmade within 10 years (in the case of principal) or 5 years (in the case of interest) from the appropriateRelevant Date. In this Condition 10 (Statute of Limitations), “Relevant Date” in respect of a Note is the dateon which a payment in respect thereof first becomes due.

11. EVENTS OF DEFAULT – ISSUER INSOLVENCY EVENTS

(a) The occurrence of any of the following events shall constitute an “Event of Default”:

(i) Non-payment: default is made in respect of any repayment of principal (when due andpayable) on its due date or any payment of Interest Payment Amount on the Most Senior

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Class of Notes on the relevant Payment Date which default or non-payment shall havecontinued unremedied for a period of three days, in the case of any payment of interest, orfive days, in the case of repayment of principal (except if such default or non-paymentoccurs on the Maturity Date); or

(ii) Breach of other obligations: default is made by the Issuer in the performance or observanceof any obligation binding upon it under the Notes or any of them or any other TransactionDocument to which it is a party (other than in respect of the obligation to pay principal andinterest on the Most Senior Class of Notes pursuant to (i) above) and (except where theRepresentative of the Noteholders certifies that, in its reasonable opinion, such default isincapable of remedy, when no notice (pursuant to this item (ii) will be required) such defaultshall have continued unremedied for a period of 30 days following the service by theRepresentative of the Noteholders on the Issuer of notice requiring the same to be remedied;or

(iii) Misrepresentation: the Issuer breaches in any material respect any representation orwarranty made by it pursuant to the Notes or any other Transaction Document to which it isa party or which is contained in any certificate, document or financial or other statementfurnished at any time under or in connection with a Transaction Document to which it is aparty and, in any case (except where the Representative of the Noteholders certifies that, inits reasonable opinion, the circumstances giving rise to such breach are incapable of remedywhen no notice will be required) the circumstances giving rise to such breach shall havecontinued unremedied for a period of 30 days following the service by the Representative ofthe Noteholders on the Issuer of notice requiring the same to be remedied; or

(iv) Winding-up: an order is made or an effective resolution is passed for the winding up of theIssuer or any of the events under Article 2484 of the Italian Civil Code occurs; or

(v) Insolvency Proceedings: the Issuer institutes or has instituted against it InsolvencyProceedings relating to the Issuer under applicable laws and such proceedings are not, in theopinion of the Representative of the Noteholders, being disputed in good faith with areasonable prospect of success; or

(vi) Arrangement of debts: the Issuer takes any action for a readjustment or deferment of any ofits obligations or makes a general assignment or an arrangement or composition with, or forthe benefit of, its creditors (other than the Issuer Secured Creditors and any secured creditorof the Issuer in respect of any Further Securitisation) or is granted by a competent court amoratorium in respect of, any of its Indebtedness or any guarantee of any Indebtedness givenby it, or it applies for or consents to the suspension of payments or an administrator,administrative receiver or liquidator or other similar official of the Issuer being appointedover or in respect of the whole or any part of the undertaking, assets and/or revenues of theIssuer or an encumbrancer taking possession of the whole or, in the reasonable opinion ofthe Representative of the Noteholders, any substantial part of the undertaking or assets of theIssuer; or

(vii) Unlawfulness: it is or will become unlawful for the Issuer (by reason of a change in law orthe interpretation or administration thereof since the Issue Date) to perform or comply withany of its obligations under or in respect of the Notes or any of the Transaction Documentsto which it is a party, or any obligation of the Issuer under any of the Transaction Documentsceases to be legal, valid, binding and enforceable or any Transaction Document or anyobligation contained or purported to be contained therein is not effective or is alleged by theIssuer to be ineffective for any reason, or any of the Issuer’s rights under the Notes or any ofthe Transaction Documents are or will (by reason of a change in law or the interpretation oradministration thereof since the Issue Date) be materially adversely affected; or

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(viii) Ineffective Security: any Security Interest purported to be created under the Issuer Securitypursuant to the Security Documents becomes invalid or ineffective,

provided that, in the case of each of the events described in paragraph (a)(vii) (Unlawfulness) of thisCondition 11 (Events of Default – Issuer Insolvency Events), no Event of Default shall occur unlessthe Representative of the Noteholders shall have certified to the Issuer that such event is, in itsopinion, materially prejudicial to the interest of the holders of the Most Senior Class of Notes; and(b) in the case of the event described in paragraphs (a)(ii) (Breach of other obligations),(a)(iii)(Misrepresentation) and (a)(vi) (Arrangement of debts) of this Condition 11 (Events of Default– Issuer Insolvency Events), no Event of Default shall occur unless sanctioned by an ExtraordinaryResolution of the Most Senior Class of Noteholders.

(b) If an Event of Default occurs, and the Representative of the Noteholders is notified of such event, theRepresentative of the Noteholders at its discretion may, and, if so directed by an ExtraordinaryResolution of the holders of the Most Senior Class of Notes or if so requested in writing by theholders of at least 75 per cent. of the aggregate of the Principal Amount Outstanding of the MostSenior Class of Notes, shall, give notice (an “Issuer Enforcement Notice”) to the Issuer that theNotes shall forthwith become immediately due and repayable at their Principal Amount Outstandingand all other amounts owed by the Issuer pursuant to the other Transaction Documents shall becomeimmediately due and payable in accordance with their terms, in each case together with accruedinterest (if any).

(c) Upon the Representative of the Noteholders delivering an Issuer Enforcement Notice to the Issuerdeclaring the Notes to be due and repayable, or upon the Issuer becoming subject to any InsolvencyProceedings (each an “Issuer Insolvency Event”), the Notes shall (subject to Condition 19 (NonPetition and Limited Recourse)) become immediately due and repayable at their Principal AmountOutstanding and all other amounts owed by the Issuer pursuant to the other Transaction Documentsshall become immediately due and payable in accordance with their terms, in each case together withaccrued interest (if any).

(d) The Noteholders hereby irrevocably appoint, as from the date hereof and with effect on the date onwhich the Notes shall become due and payable following the service of an Issuer EnforcementNotice or the occurrence of an Issuer Insolvency Event, the Representative of the Noteholders astheir exclusive agent (mandatario esclusivo) to receive on their behalf from the Issuer any and allmonies payable by the Issuer to the Noteholders and the other Issuer Secured Creditors from andincluding the date on which the Notes shall become due and payable, such monies to be applied inaccordance with the Enforcement Priority of Payments.

12. ENFORCEMENT

(a) At any time after the Notes have become due and repayable following the service of an IssuerEnforcement Notice or the occurrence of an Issuer Insolvency Event and without prejudice to theRepresentative of the Noteholders’ right to enforce the Security Documents and the relevant IssuerSecurity:

(i) the Representative of the Noteholders may, at its discretion and without further notice, takesuch steps and/or institute such proceedings against the Issuer as it thinks fit to direct theIssuer to take any action in relation to the Portfolio and to enforce the Issuer Security and toenforce repayment of the Notes and payment of accrued interest thereon and any otheramounts owed but unpaid by the Issuer, but it shall not be bound to take any suchproceedings or steps unless it shall have been directed by an Extraordinary Resolution of theholders of the Most Senior Class of Notes or so requested in writing by the holders of atleast 75 per cent. of the aggregate of the Principal Amount Outstanding of Most Senior Class

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of Notes and, in all cases, it shall have been indemnified and/or secured to its satisfaction;and

(ii) the Representative of the Noteholders shall become entitled, pursuant to the Mandate, todispose of the Portfolio in whole or in part.

(b) Each Noteholder, by acquiring title to a Note, and each Other Issuer Secured Creditor, by executingthe Transaction Documents to which it is expressed to be a party, is deemed to agree andacknowledge that:

(i) the Representative of the Noteholders has entered into the Security Documents for itself andas agent in the name of and on behalf of each Noteholder from time to time and each of theOther Issuer Secured Creditors thereunder;

(ii) by virtue of the transfer to it of the relevant Note, each Noteholder, and by virtue of theexecution of each Transaction Document to which it is respectively a party, each TransactionParty, shall be deemed to have granted to the Representative of the Noteholders, as its agent,the right (a) to exercise in such manner as the Representative of the Noteholders in its soleopinion deems appropriate, on behalf of such Noteholder (or Transaction Party, as the casemay be), all of that Noteholder’s (or such Transaction Party’s) rights under the ItalianSecuritisation Law in respect of the Portfolio and all amounts and/or other assets of theIssuer arising from the Portfolio and the Transaction Documents not subject to the IssuerSecurity and (b) to enforce its rights as an Issuer Secured Creditor for and on its behalf underthe Security Documents and in relation to the Issuer Security;

(iii) the Representative of the Noteholders, in its capacity as agent in the name of and on behalfof the Noteholders of each Class and of each Other Issuer Secured Creditor, shall be the onlyperson entitled under these Conditions and under the Transaction Documents to instituteproceedings against the Issuer and/or to enforce or to exercise any rights in connection withthe Issuer Security or to take any steps against the Issuer or any of the other parties to theTransaction Documents for the purposes of enforcing the rights of the Noteholders under theNotes of each Class and/or of the Other Issuer Secured Creditors with respect to the otherTransaction Documents and recovering any amounts owing under the Notes or under theTransaction Documents;

(iv) the Representative of the Noteholders shall have exclusive rights under the SecurityDocuments to make demands, give notices, exercise or refrain from exercising any rightsand to take or refrain from taking any action (including, without limitation, the release orsubstitution of security) in respect of the Issuer Security;

(v) without prejudice to Condition 19 (Non Petition and Limited Recourse) no Noteholder orOther Issuer Secured Creditor shall be entitled to proceed directly against the Issuer nor takeany steps or pursue any action whatsoever for the purpose of recovering any debts due orowing to it by the Issuer or take, or join in taking, steps for the purpose of obtaining paymentof any amount expressed to be payable by the Issuer or the performance of any of theIssuer’s obligations under these Conditions and/or the Transaction Documents or petition foror procure the commencement of Insolvency Proceedings or the winding-up, insolvency,extraordinary administration or compulsory administrative liquidation of the Issuer or theappointment of any kind of insolvency official, administrator, liquidator, trustee, custodian,receiver or other similar official in respect of the Issuer for any, all, or substantially all theassets of the Issuer or in connection with any reorganisation or arrangement or compositionin respect of the Issuer, pursuant to the Italian Banking Act or otherwise until the expiry ofone year and one day following redemption or cancellation of all Notes and any FurtherNotes (if any),

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unless

(A) (in each case under (ii), (iii), (iv) and (v) above) an Issuer Enforcement Notice shallhave been served or an Issuer Insolvency Event shall have occurred and theRepresentative of the Noteholders, having become bound so to do, fails to do so withina reasonable period and such failure shall be continuing (provided that any such failureshall not be conclusive per se of a default or breach of duty by the Representative of theNoteholders); or

(B) the Representative of Noteholders declines to serve an Issuer Enforcement Notice orotherwise act or exercise any of its rights, powers, authorities or discretions under theNotes or the Transaction Documents by reason of it not being indemnified and/orsecured to its satisfaction after being directed by or requested by the Noteholders to doso,

PROVIDED THAT the Noteholder may then only exercise any of its rights, powers, authoritiesand/or discretions subject to the provisions of these Conditions, PROVIDED HOWEVER thatnothing in this Condition 12 shall prevent the Issuer Secured Creditors from taking any stepsagainst the Issuer which do not amount to the commencement or to the threat ofcommencement of legal proceedings against the Issuer or to procuring the appointment of anadministrative receiver for or to the making of an administration order against or to thewinding up or liquidation of the Issuer or its submission to Insolvency Proceedings andPROVIDED FURTHER THAT this Condition 12 shall not prejudice the right of any IssuerSecured Creditor to prove a claim in the insolvency of the Issuer where such insolvencyfollows the institution of Insolvency Proceedings by a third party;

(vi) (without prejudice to the provisions of the Interest Rate Swap Agreement) no Noteholder orany Other Issuer Secured Creditor shall at any time exercise any right of netting, set-off orcounterclaim in respect of its rights against the Issuer such rights being expressly waived orexercise any right of claim of the Issuer by way of a subrogation action (azionesurrogatoria) pursuant to Article 2900 of the Italian Civil Code; and

(vii) the provisions of this Condition 12 shall survive and shall not be extinguished by theredemption (in whole or in part) and/or cancellation of the Notes and, subject to theforegoing provisions, waives to the greatest extent permitted by law any rights directly toenforce its rights against the Issuer.

13. MEETINGS OF NOTEHOLDERS

(a) General

(i) The Noteholders shall resolve by resolution and meet in accordance with this Condition 13(Meetings of the Noteholders).

(ii) Subject to the provisions of these Conditions, joint meetings of the Noteholders of eachClass may be held to consider the same resolution and/or, as the case may be, the sameExtraordinary Resolution (other than an Extraordinary Resolution relating to a Basic TermsModification) and the provisions of these Conditions shall apply mutatis mutandis thereto.

(iii) The following provisions shall apply where outstanding Notes belong to more than oneClass:

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(A) matters which in the reasonable opinion of the Representative of the Noteholders affectonly one Class of Notes shall be transacted at a separate Meeting of the Noteholders ofsuch Class;

(B) matters which in the reasonable opinion of the Representative of the Noteholders affectmore than one Class of Notes but do not give rise to an actual or potential conflict ofinterest between the Noteholders of one such Class of Notes and the Noteholders of anyother Class of Notes shall be transacted either at separate Meetings of the Noteholdersof each such Class of Notes or at a single Meeting of the Noteholders of all suchClasses of Notes as the Representative of the Noteholders shall reasonably determine inits absolute discretion;

(C) matters which in the reasonable opinion of the Representative of the Noteholders affectthe Noteholders of more than one Class of Notes and give rise to an actual or potentialconflict of interest between the Noteholders of one such Class of Notes and theNoteholders of any other Class of Notes shall be transacted at a separate Meeting of theNoteholders of each such Class; and

(D) matters which in the reasonable opinion of the Representative of the Noteholders relateto a Basic Terms Modification and which give rise or may give rise to a conflictbetween the interests of the Class A Noteholders and any other Class of Noteholdersshall be required to be transacted by way of each of them passing an ExtraordinaryResolution.

In this paragraph “matters” includes (without limitation) the passing or rejection of anyresolution, and references to “Notes” and “Noteholders” shall be deemed to be to the Notesof the relevant Class and to the holders thereof, respectively.

(iv) Subject to all other provisions contained in these Conditions, the Representative of theNoteholders may without the consent of the Issuer or the Noteholders prescribe such furtherregulations regarding the holding of the Meetings of Noteholders and attendance and votingat them as the Representative of the Noteholders may reasonably determine.

(b) Convening a Meeting

The Representative of the Noteholders or the Issuer may at any time convene a Meeting and eachmust do so upon a request in writing of Noteholders holding not less than ten per cent. of theaggregate Principal Amount Outstanding of the Notes of the relevant Class then outstanding.Whenever the Issuer intends to convene any Meeting it shall forthwith give notice in writing to theRepresentative of the Noteholders of the day, time and place thereof and of the nature of the businessto be transacted thereat. Every Meeting shall be held at such place as the Representative of theNoteholders may appoint or approve, provided that it is in an EU Member State.

(c) Notice

(i) At least 21 days’ notice (exclusive of the day on which the notice is given and the day onwhich the relevant Meeting is to be held) specifying the day, time, place and agenda of theMeeting shall be given by the Issuer to the relevant Class of Noteholders in the mannerprovided by Condition 16 (Notice to Noteholders). The notice may also set the day for asecond call, being not less than 14 clear days and no more than 42 clear days after the datefixed for the first call. The notice shall be copied to the Issuer if the Meeting is convened bythe Representative of the Noteholders and shall be copied to the Representative of theNoteholders if it is convened by the Issuer;

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(ii) such notice shall set out the full terms of any resolutions to be proposed at such Meetingunless the Representative of the Noteholders determines (in its absolute discretion) that thenotice shall instead specify the nature of the resolutions to be proposed at such Meetingwithout specifying the full text; and

(iii) in respect of any Meeting adjourned for want of a quorum and which is resumed after suchadjournment, 10 days’ notice (exclusive of the day on which the notice is given and of thedate on which the Meeting is to be resumed) shall be given by the Issuer to the relevantClass of Noteholders, unless the notice of the original Meeting set the date for a second call,in which case no such notice shall be necessary. Such notice shall specify the quorum whichwill apply at such adjourned Meeting, unless the notice of the original Meeting specifiedsuch quorum or such quorum is as set out in (h) (Quorum) below, in which case no suchspecification is required. Subject as aforesaid, it shall not be necessary to give notice of anadjourned Meeting.

(d) Participation

The following may attend and speak at a Meeting:

(i) voters having the right to vote at such Meeting;

(ii) the Issuer or its representatives;

(iii) the financial advisers to the Issuer;

(iv) the legal counsel(s) to the Issuer and to the Representative of the Noteholders;

(v) the Representative of the Noteholders; and

(vi) such other person as may be resolved by the Meeting or decided by the Representative of theNoteholders.

(e) Admission

Any bearer of a valid Certificate of Admission or any Proxy named in a Block Voting Instructioncan attend and vote at any Meeting relating to the Notes in respect of which the Certificate ofAdmission or Block Voting Instruction has been issued.

(f) Proxies and validity of Block Voting Instruction

(a) Each Block Voting Instruction and each Certificate of Admission shall be deposited at theregistered office of the Issuer, or at such other place as the Representative of the Noteholdersshall designate or approve not less than 2 (two) Business Days before the time appointed forholding the Meeting or adjourned Meeting at which the Proxies named in the Block VotingInstruction propose to vote and in default the Block Voting Instruction shall not be treated asvalid unless the chairman of the Meeting decides otherwise before such meeting oradjourned Meeting proceeds to business.

(b) Any vote given in accordance with the terms of a Block Voting Instruction or by a personentitled to vote by virtue of a Certificate of Admission shall be valid notwithstanding theprevious revocation or amendment of the Block Voting Instruction or Certificate ofAdmission, as the case may be, or of any of the instructions of each Class of Noteholderspursuant to which it was executed, provided that no intimation in writing of such revocationor amendment shall have been received by or on behalf of the Representative of the

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Noteholders at its registered office or by the chairman of the Meeting, in each case at anytime more than 48 hours prior to the time fixed for the commencement of the Meeting oradjourned Meeting at which the Block Voting Instruction or Certificate of Admission, as thecase may be, is intended to be used.

(c) Without prejudice to the obligations of the Proxies named in any Block Voting Instruction,form of Proxy, or persons voting pursuant to a Certificate of Admission, any person entitledto more than one vote need not use every vote or cast all such votes in the same way.

(g) Chairman

An individual (who may, but need not, be a Noteholder) nominated in writing by the Representativeof the Noteholders shall be entitled to take the chair at every such Meeting but if no such nominationis made or if at any Meeting the person nominated is not present within 15 minutes after the timeappointed for the holding of such Meeting, those present shall choose one of their members to bechairman and, failing such choice, the Issuer may appoint a chairman (who may, but need not, be aNoteholder).

(h) Quorum

The quorum for conducting business at any Meeting for passing a resolution shall be as follows:

(i) for all business other than voting on an Extraordinary Resolution, one or more personsholding or representing not less than 10 per cent. of the aggregate Principal AmountOutstanding of the Notes of the relevant Class then outstanding;

(ii) where the business of such Meeting includes voting on any Extraordinary Resolution otherthan a Basic Terms Modification, one or more persons holding or representing not less than50 per cent. of the aggregate Principal Amount Outstanding of the Notes of the relevantClass then outstanding;

(iii) where the business of such Meeting includes an Extraordinary Resolution proposing a BasicTerms Modification, one or more persons holding or representing not less than 75 per cent.of the aggregate Principal Amount Outstanding of the Notes of the relevant Class thenoutstanding,

PROVIDED THAT in the case of any Meeting which has resumed for a second call afteradjournment for want of a quorum, the quorum shall be as follows:

(iv) subject to paragraph (v), one or more persons being or representing the relevant Class of theNoteholders, whatever the aggregate Principal Amount Outstanding of the relevant Class ofthe Notes so held or represented;

(v) where the business of the adjourned Meeting includes an Extraordinary Resolution relatingto Basic Terms Modification, the necessary quorum for passing a resolution shall be two ormore persons holding or representing not less than 25 per cent., of the aggregate PrincipalAmount Outstanding of the Notes of the relevant Class then outstanding.

No business (other than the choosing of a chairman) shall be transacted at any meeting unless therequisite quorum be present at the commencement of business. In respect of any meeting convenedto consider a resolution pursuant to Condition 12 (Enforcement), the Notes of the relevant Classwhich are held by the Originator or on its behalf, or by any person or entity controlled by it or withwhich it is under common control, shall be excluded from the quorum and the Noteholders may notvote on such resolution.

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(i) Adjournment

If, within half an hour from the time appointed for any Meeting, a quorum is not present, theMeeting shall, (i) if convened upon the requisition of Noteholders, be dissolved; and (ii) in the caseof any other Meeting, it shall be adjourned for such period not being less than 14 days nor more than42 days, and to such place as may be determined by the chairman. Each adjourned Meeting, subjectto paragraph (h) (Quorum), shall have the power to pass any resolution and to decide upon allmatters which could properly have been dealt with at the Meeting adjourned for want of a quorumhad a quorum been present at such Meeting. No Meeting may be adjourned more than once for wantof a quorum.

(j) Votes

(i) On a show of hands, every Voter entitled to Vote at the Meeting shall have one vote.

(ii) On a poll every Voter present in person shall have one vote in respect of each Euro 1 of thePrincipal Amount Outstanding of Notes represented or held by such Voter.

(iii) In the case of an equality of votes either on a poll or a show of hands the chairman shall havea casting vote in addition to any other vote or votes to which he may be entitled as Voter.

(k) Show of hands and poll

(i) Every question submitted to a Meeting shall be decided in the first instance by a show ofhands and any resolution, other than an Extraordinary Resolution, may be passed by asimple majority. In the case of equality of votes, the chairman shall, both on a show of handsand on a poll, have a casting vote in addition to any other vote or votes to which thechairman is entitled as Noteholder and/or as a proxy.

(ii) At any Meeting, unless a poll is demanded, a declaration by the chairman that a resolutionhas been carried or carried by a particular majority or lost or not carried by any particularmajority shall be conclusive evidence of the fact without proof of the number or proportionof the votes recorded in favour of or against such resolution.

(iii) At any Meeting a poll may be demanded, before or after the declaration of the result of ashow of hands, by the chairman, by the Issuer or by one or more Voters representing orbeing in the aggregate the holders of not less than 2 (two) per cent. of the Principal AmountOutstanding of the Notes of the relevant Class or Classes then outstanding.

(iv) If at any Meeting a poll is so demanded, it shall be taken in such manner and (subject ashereinafter provided) either at once or after such adjournment as the chairman directs, andthe result of such poll shall be deemed to be the resolution of the Meeting at which the pollwas demanded as at the date of the taking of the poll. Notwithstanding the foregoing, thedemand for a poll shall not prevent the continuance of the Meeting for the transaction of anybusiness other than the question on which the poll has been demanded.

(v) Any poll demanded at any Meeting on the election of a chairman or on any question ofadjournment shall be taken at the meeting without adjournment.

(vi) Notice of the result of the voting on any resolution duly considered by the Noteholders shallbe published in accordance with Condition 16 (Notice to Noteholders).

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(l) Written Resolution

A Written Resolution shall take effect as an Extraordinary Resolution.

(m) Exclusive powers of the Meetings

Subject to paragraphs (n) (Powers exercisable only by Extraordinary Resolution), (o) (Bindingnature of Resolution) and (p) (Limitations on Resolutions as between Classes of Notes) of thisCondition 13, the Meeting of the Noteholders of any Class shall have exclusive powers in relation tothe following matters:

(i) to instruct the Representative of the Noteholders to take any action or make anydetermination as it is entitled to make in accordance with the terms of these Conditions ofthe relevant Class of Notes and/or the other Transaction Documents (including, withoutlimitation, to serve an Issuer Enforcement Notice following the occurrence of an Event ofDefault or to enforce the Issuer Security or to dispose of the Portfolio);

(ii) to approve or consent to any proposal or matter for which the approval or consent of theNoteholders of the relevant Class is required in accordance with the terms of theseConditions of the relevant Class of Notes and/or the other Transaction Documents(including, without limitation, any matter which, in the opinion of the Representative of theNoteholders, is materially prejudicial to the interests of the Noteholders of that Class) and toapprove the substitution of any person for the Issuer (or any previous substitute) as principalobligor under the Notes;

(iii) to make any determination of any matter for which the determination of the Noteholders ofthe relevant Class is required in accordance with the terms of these Conditions of therelevant Class of Notes and/or the other Transaction Documents;

(iv) to authorise any person or Noteholders of that Class (other than the Representative of theNoteholders or its permitted agents and employees) to take any action on behalf of orseparately from the Noteholders of that Class with respect to the Issuer, its assets, thePortfolio, the Issuer Security, the Transaction Documents or any party thereto;

(v) to sanction, as required, a resolution passed at a meeting of any other Class of Noteholders;

(vi) to approve any proposal by the Representative of the Noteholders for any modification,abrogation, variation or compromise of any of these Conditions or any arrangement inrespect of the obligations of the Issuer under or in respect of the Notes;

(vii) to appoint and to remove the Representative of the Noteholders; and

(viii) to approve any Basic Terms Modification.

(n) Powers exercisable only by Extraordinary Resolution

A Meeting of the Noteholders of any Class of Notes may not validly resolve nor have the power todo any of the following unless such resolution is an Extraordinary Resolution:

(i) to approve the making of a Basic Terms Modification;

(ii) to approve any matter which, in the reasonable opinion of the Representative of theNoteholders, is materially prejudicial to the interests of the Noteholders of that Class;

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(iii) to permit the obligations of the Issuer to redeem the Principal Amount Outstanding under theNotes of that Class or to pay any amount of interest thereunder to be discharged in anymanner other than in accordance with their terms;

(iv) to sanction any proposal by the Issuer for any alteration, abrogation, variation orcompromise of, or arrangement in respect of, the rights of the Noteholders against the Issueror against any of its property or against any other person whether such rights shall ariseunder these Conditions, the Notes or otherwise;

(v) to assent to any alteration of the provisions contained in these Conditions, the Notes or anyClass of Notes or the Transaction Documents which shall be proposed by the Representativeof the Noteholders or any other party thereto;

(vi) to discharge or to exonerate the Representative of the Noteholders from any liability inrespect of any act or omission for which the Representative of the Noteholders may havebecome responsible (other than in the case of fraud or wilful default) under or in relation tothese Conditions of any Class of the Notes or any other Transaction Documents;

(vii) to approve, authorise, or give any direction which under the provisions of these Conditionsof the relevant Class of Notes is required to be given by Extraordinary Resolution;

(viii) to approve the terms of any settlement of a dispute or litigation in which the Noteholders ofthat Class are involved as Noteholders of that Class;

(ix) to grant any person a release or authority to derogate from the requirement to obtain theconsent of the Noteholders of that Class under these Conditions;

(x) to approve a sale of the Portfolio following the service of an Issuer Enforcement Notice orthe occurrence of an Issuer Insolvency Event; and

(xi) to sanction, as required, an Extraordinary Resolution by any other Class of Noteholders.

(o) Binding nature of resolution

Subject to paragraph (m) (Exclusive powers of the Meetings) a resolution passed at any meeting ofthe relevant Class of Noteholders duly convened and held in accordance with these Conditions shallbe binding on all Noteholders of the relevant Class whether or not they are present at the meeting.Any resolution passed at a meeting of the Most Senior Class of Notes or any Written Resolution bythe holders of the Most Senior Class of Notes shall without prejudice to paragraph (p) below also bebinding upon all the other Classes of Notes.

(p) Limitations on Resolutions as between Classes of Notes

(i) No Extraordinary Resolution involving a Basic Terms Modification passed by theNoteholders of any Class shall be effective unless it is sanctioned by an ExtraordinaryResolution of the Noteholders of all other outstanding Classes of Notes.

(ii) No direction of the Noteholders of any Class to the Representative of the Noteholders to takeany action and no resolution passed at any meeting of a Class of Notes shall be effective forany purpose unless and until either (A) all the Noteholders of senior ranking Classes of theNotes (in respect of payments of principal) under the Enforcement Priority of Payments notredeemed in full (each an “Outstanding Senior Class”) have sanctioned such direction orresolution; or (B) the Representative of the Noteholders is of the opinion that the

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implementation of such direction or resolution would not be materially prejudicial to theinterests of the holders of each such Outstanding Senior Class of Notes.

(iii) Where it is specified in these Conditions or the Transaction Documents that only theExtraordinary Resolution or resolution of a particular Class of Notes is required, suchExtraordinary Resolution or resolution shall be effective for all purposes without thesanction of any other Class of Noteholders.

(q) Minutes

Minutes shall be made of all resolutions and proceedings at each Meeting. The chairman shall signthe minutes, which shall be prima facie evidence of the proceedings recorded therein. Unless anduntil the contrary is proved, every such Meeting in respect of the proceedings of which minutes havebeen signed shall be deemed to have been duly convened and held, and all resolutions passed orproceedings transacted at it shall be deemed to have been duly passed and transacted.

(r) Challenge of resolution

Each Noteholder of the relevant Class who was absent from and/or dissenting at any Meeting canchallenge resolutions which are not passed in accordance with the provisions of the relevantConditions.

(s) Individual actions and remedies

(i) Without prejudice to the other provisions of these Conditions (and subject, in particular, tothe provisions in Condition 12(b)(iv) (Enforcement)) the right of each Noteholder of therelevant Class to bring individual actions or take individual remedies to enforce his/herrights under the relevant Class of the Notes will be subject to a Meeting not passing aresolution objecting to such individual action or other remedy on the grounds that is notconvenient at the time when the Meeting is held, having regard to the interests of theNoteholders of the relevant Class. In this respect, the following provisions shall apply:

(A) the Noteholder of the relevant Class intending to enforce his/her rights under therelevant Notes will notify the Representative of the Noteholders of his/her intention;

(B) the Representative of the Noteholders will, without delay, convene a Meeting, inaccordance with the relevant Conditions;

(C) if the Meeting passes a resolution objecting to the enforcement of the individual actionor remedy, the Noteholder of the relevant Class will be prevented from taking suchaction or remedy (provided that the same matter can be submitted again to a furthermeeting of the Noteholders of the relevant Class after a reasonable period of time haselapsed); and

(D) if the Meeting of the Noteholders of the relevant Class does not object to theenforcement of individual action or remedy, or no resolution is taken by the Meeting forwant of quorum, the Noteholder will not be prohibited from taking such individualaction or remedy.

(ii) No individual action or remedy can be taken by a Noteholder to enforce his/her rights underthe relevant Notes unless a meeting of the Noteholders of the relevant Class has been held toresolve on such action or remedy and in accordance with the provisions of this paragraph;and

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(iii) The provisions of Condition 12(b) (Enforcement) and the Intercreditor Agreement governthe right of the Noteholders to institute against, or join any other person in institutingagainst, the Issuer any bankruptcy, insolvency or compulsory liquidation or similarproceedings.

For the purposes of this Condition 13 (Meetings of the Noteholders):

“Basic Terms Modification” means, with respect to the Notes of all Series in any Class:

(i) a modification of the date fixed for final maturity of the relevant Class of the Notes;

(ii) any modification which would have the effect of (A) reducing or cancelling of the principalamount payable on the relevant Class of the Notes or the priority of redemption of therelevant Class of the Notes, (B) altering the amount of interest and other amounts, if any,payable on the relevant Class of the Notes, (C) altering the method of calculating the amountof interest or such other amounts payable on the relevant Class of the Notes, (D) altering thedate of payment of any interest or such other amount payable of the relevant Class of theNotes, (E) altering the currency in which payments are made under the relevant Class of theNotes, (F) altering the majority required to pass a resolution at any Meeting, the manner inwhich such majority is constituted at any Meeting or an alteration of the quorum required toconvene such a Meeting, (G) altering the authorisation or consent by the Noteholders, asIssuer Secured Creditors, to the application of funds as provided for in the TransactionDocuments;

(iii) removing or replacing the Representative of the Noteholders; or

(iv) amending (A) this definition, (B) the majority required to effect a Basic Terms Modificationor (C) the majority required to pass an Extraordinary Resolution.

“Block Voting Instruction” means, in relation to any Meeting, a document:

(i) certifying that certain specified Notes have been blocked in an account with a clearingsystem or the depository Monte Titoli Account Holders (under the Monte Titoli systempursuant to Resolution No. 11768), as the case may be, and that such Notes will not bereleased until the conclusion of the Meeting specified in such document or, if applicable, anyadjournment of such Meeting;

(ii) certifying that each holder of such Notes has instructed the relevant Proxy (as definedbelow) that the vote(s) attributable to such blocked Note(s) are to be cast in a particular wayin relation to the resolution or resolutions to be put to such Meeting or any adjournment ofsuch Meeting and that, during the period commencing 2 (two) Business Days prior to thetime fixed for the Meeting, such instruction may not be amended or revoked;

(iii) specifying the aggregate principal amount of the Notes so blocked, distinguishing withregard to each resolution between those in respect of which instructions have been given asaforesaid that the votes attributable thereto should be cast in favour of the resolution andthose in respect of which instructions have been so given that the votes attributable theretoshould be cast against the resolution; and

(iv) authorising and instructing one or more individuals (who need not be Noteholders) named insuch document (each a “Proxy”) to vote in accordance with such instructions.

“Certificate of Admission” means a certificate issued by the Monte Titoli Account Holders underthe Monte Titoli system pursuant to Resolution No. 11768.

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“Extraordinary Resolution” means a resolution passed at a meeting duly convened and held inaccordance with the provisions contained in the relevant Conditions by a majority consisting of notless than 75 per cent. of the votes cast.

“Meeting” means a meeting means a meeting of the Noteholders or of any Class thereof (whetheroriginally convened or resumed following an adjournment).

“Proxy” means, in relation to any Meeting, a person appointed to vote under a Block VotingInstruction other than:

(i) any such person whose appointment has been revoked and in relation to whom theRepresentative of the Noteholders has been notified in writing of such revocation by the timewhich is 48 hours before the time fixed for such Meeting; and

(ii) any such person appointed to vote at a Meeting which has been adjourned for want of aquorum and who has not been re-appointed to vote at the Meeting when it is resumed;

“Voter” means any person as described in Condition 15(e) (Meeting of Noteholders – Admission).

“Written Resolution” means a resolution in writing executed by or on behalf of all the Noteholdersof the relevant Class and may consist of several instruments in like form each executed by or onbehalf of one or more of such holders.

14. REPRESENTATIVE OF THE NOTEHOLDERS

(a) Each of the Noteholders acknowledges and agrees that the holding of the Notes constitutes full andunconditional acceptance of the appointment of the Representative of the Noteholders upon theterms of its appointment for the time being, subject to the relevant Conditions, and that theRepresentative of the Noteholders is the legal representative of the Noteholders. Pursuant to theseConditions, for as long as any Note is outstanding, there shall at all times be a Representative of theNoteholders. The appointment of the Representative of the Noteholders shall be made by theNoteholders subject to and in accordance with these Conditions, except for the initial Representativeof the Noteholders appointed at the time of issue of the Notes, who is appointed by the initialsubscribers of the Rated Notes and the Class Z Notes. Each Noteholder is deemed to accept suchappointment. Each of the Noteholders acknowledges and agrees that the Representative of theNoteholders shall (subject to being indemnified and/or secured against costs, losses or liabilities)implement the resolutions taken by the Noteholders and generally, when required to act under theTransaction Documents or to make any determination with respect to the transactions contemplatedtherein, protect the interests of the Noteholders generally, provided that, in the event of a conflict ofinterest, the interests of the holders of the Most Senior Class of Notes shall prevail. Each of theNoteholders acknowledges and agrees that the Representative of the Noteholders has been, and eachsuccessor Representative of the Noteholders shall be, appointed for an unlimited term and can beremoved by the Noteholders at any time as specified below. The Representative of the Noteholdersis entitled to enter into business transactions with the Issuer and any agent of the Issuer withoutaccounting for any profit resulting therefrom. To the extent that the Rated Notes are outstanding, theRepresentative of the Noteholders will be entitled to assume, for the purposes of exercising anypower, trust, authority, duty or discretion under or in relation to these Conditions and the TransactionDocuments that such exercise will not be prejudicial to the interest of any of the Noteholders if theRating Agencies have confirmed that the then current ratings of the Rated Notes would not beadversely affected by such exercise.

(b) The Representative of the Noteholders can be removed by the Noteholders at any time, provided thata successor Representative of the Noteholders is appointed which shall be:

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(i) a bank incorporated in any jurisdiction of the European Union or a bank incorporated in anyother jurisdiction acting through an Italian branch; or

(ii) a financial institution registered under Article 106 of the Italian Banking Act; or

(iii) a company incorporated in any jurisdiction of the European Union offering in suchjurisdiction agency and trust services similar to those to be carried out by the Representativeof the Noteholders pursuant to the Transaction Documents and belonging to a primarybanking group; or

(iv) any other entity which may be permitted by any specific provisions of Italian law applicableto the securitisation of monetary rights and/or by any regulations, instructions, guidelinesand/or specific approvals issued by the competent Italian supervising authorities.

It is further understood and agreed that directors, auditors, employees of the Issuer and those whofall in any of the conditions set out in Article 2399 of the Italian Civil Code cannot be appointed asthe Representative of the Noteholders. For so long as any Class of Rated Notes is listed on the IrishStock Exchange and the rules of that exchange so require, notice of the appointment of any successorRepresentative of the Noteholders as described in this paragraph (b) and in paragraph (c) below shallbe published in a newspaper having general circulation in Ireland.

(c) With the exception of the appointment of the first Representative of the Noteholders which wasmade pursuant to the terms of the Subscription Agreements, the appointment of any newRepresentative of the Noteholders or the removal of any Representative of the Noteholders shall beapproved by a resolution of each Class of Noteholders. The Representative of the Noteholders mayresign at any time upon giving not less than three calendar months’ prior written notice to the Issuerwithout giving any reason therefore and without being responsible for any costs incurred as a resultof such resignation. The removal and/or resignation of any Representative of the Noteholders shallnot become effective unless and until a new Representative of the Noteholders has been appointed inaccordance with these Conditions and has accepted appointment. The appointment of such newRepresentative of the Noteholders shall not be effective until such time as the Issuer and the OtherIssuer Secured Creditors have granted to such new Representative of the Noteholders a mandate inthe same form as the Mandate and any other powers of attorney (mandati) granted to the previousRepresentative of the Noteholders under the Intercreditor Agreement and the other TransactionDocuments. If, after the resignation of a Representative of the Noteholders, a new Representative ofthe Noteholders is not appointed at the meeting of the Noteholders within sixty days of receipt by theIssuer of the notice of resignation, the resigning Representative of the Noteholders will be entitled toappoint its own successor, provided that (i) any successor shall satisfy the condition set out above;and (ii) the Rating Agencies (other than Moody’s) have confirmed in writing that such appointmentshall not adversely affect the rating of the Rated Notes. Each holder of the Rated Notes, by reason ofholding the Rated Notes, will recognise the power of the Representative of the Noteholders, herebygranted, to appoint its own successor and recognise the Representative of the Noteholders soappointed as its representative.

(d) Each of the Noteholders acknowledges and agrees that the Representative of the Noteholders shallimplement the resolutions taken by the Noteholders and, when required to act under the TransactionDocuments or to make any determination with respect to the transactions contemplated therein,protect the interests of the Noteholders generally, but, in the case of a conflict of interest, theinterests of the holders of the Most Senior Class of Notes. The Representative of the Noteholdersshall ensure that any resolution of any meeting of the Noteholders passed is duly implemented andshall ensure protection of the Noteholders’ interest with respect to the Issuer.

(e) The Representative of Noteholders is entitled to have regard, in the exercise of its powers, trusts,authorities, duties and discretions: (i) to the general interests of the Noteholders as a class and shall

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not have regard to any interests arising from circumstances particular to individual Noteholders(whatever their number) and, in particular but without limitation, shall not have regard to theconsequences of any such exercise for individual Noteholders (whatever their number) resultingfrom their being for any purpose domiciled or resident in, or otherwise connected with, or subject tothe jurisdiction of, any particular territory or any political sub-division thereof and theRepresentative of the Noteholders shall not be entitled to require, nor shall any Noteholder beentitled to claim, from the Issuer, the Representative of the Noteholders or any other person anyindemnification or payment in respect of any tax consequence of any such exercise upon individualNoteholders (ii) to the interests of the Noteholders of each Class (except where expressly providedotherwise), but if, in the Representative of the Noteholders’ opinion, there is a conflict between theinterests of the Noteholders of any Class, it shall have regard only to the interest of the holders of theMost Senior Class of Notes; and (ii) to the interests of the Issuer Secured Creditors and, in any suchcase, to have regard only (except where specifically provided otherwise) to: (A) the interest of theholders of the Most Senior Class of Notes if, in the Representative of the Noteholders’ opinion, thereis a conflict between the interests of the Noteholders of any Class, as the case may be, and theinterests of any Other Issuer Secured Creditor (or any combination of them); and (B) subject to (A)above, the Issuer Secured Creditor to whom any amounts are owed appearing highest in theEnforcement Priority of Payments.

(f) The Representative of the Noteholders shall be the agent to act in the name and on behalf of theNoteholders for all legal purposes and shall be entitled to exercise in their name and on their behalfall the rights granted by the Issuer in favour of the Noteholders under the Security Documents. TheRepresentative of the Noteholders may, in the execution and exercise of all its functions or powers,act through authorised representatives or an authorised representative. The Representative of theNoteholders may also whenever he/it thinks it expedient in the interests of the Noteholders whetherby special power of attorney or otherwise delegate to any person or persons all his/its powers. Thisdelegation may be made upon such terms and subject to such regulations (including power to sub-delegate) as the Representative of the Noteholders may think fit in the interests of the Noteholders.The Representative of the Noteholders shall not be under any obligation to supervise the proceedingsor acts of any such delegate or sub-delegate or be in any way responsible for any Liability incurredby reason of any misconduct or default on the part of any such delegate or sub-delegate. TheRepresentative of the Noteholders shall, as soon as reasonably practicable, give notice to the Issuerof the appointment, renewal, extension and termination of any delegation and shall procure that anydelegate shall also as soon as reasonably practicable, give notice to the Issuer of any sub-delegate.

(g) Any consent or approval given by the Representative of the Noteholders for the purpose of theseConditions and of the Transaction Documents may be given on such terms and subject to suchconditions (if any) as the Representative of the Noteholders thinks fit and notwithstanding anythingto the contrary in these Conditions and Transaction Documents may be given retrospectively. TheRepresentative of the Noteholders may give any consent or approval, exercise any power, authorityor discretion or take any similar action (whether or not such consent, approval, power, authority,discretion or action is specifically referred to in these Conditions and in the Transaction Documents)if it is satisfied that the interests of the Noteholders will not be materially prejudiced thereby. For theavoidance of doubt, the Representative of the Noteholders shall not have any duty to the Noteholdersin relation to such matters other than that which is contained in the preceding sentence.

(h) The Representative of the Noteholders as between itself and the Noteholders may determine allquestions and doubts arising in relation to any of the provisions of these Conditions and theTransaction Documents. Every such determination, whether or not relating in whole or in part to theacts or proceedings of the Representative of the Noteholders, shall be conclusive and shall bind theRepresentative of the Noteholders and the Noteholders.

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(i) The Representative of the Noteholders shall be authorised to represent the Noteholders in judicialproceedings, including enforcement proceedings and Insolvency Proceedings against the Issuer in sofar as they relate to the Notes and the other Transaction Documents.

(j) The Representative of the Noteholders shall not assume and shall not be liable for any obligationsother than those expressly provided in the Transaction Documents and in these Conditions. Inparticular:

(i) under the terms of the Intercreditor Agreement, the Issuer Secured Creditors have agreedthat the Representative of the Noteholders shall not be liable vis-à-vis the Issuer SecuredCreditors for damages suffered by the Issuer Secured Creditors arising from any activitycarried out by the Representative of the Noteholders acting in its capacity as representativeof the Noteholders and of Issuer Secured Creditors save in circumstances where theRepresentative of the Noteholders acts with gross negligence (colpa grave) and/or wilfuldefault and/or fraud (dolo); and

(ii) the Representative of the Noteholders shall not be liable vis-à-vis the Noteholders fordamages suffered by the Noteholders arising from any activity carried out by theRepresentative of the Noteholders acting in its capacity as representative of the Noteholders,save in circumstances where the Representative of the Noteholders acted with grossnegligence (colpa grave) and/or wilful default and/or fraud (dolo).

(k) Without limiting the generality of the foregoing, the Representative of the Noteholders:

(i) shall be entitled to act on the advice, certificate or opinion of or on any information obtainedfrom any lawyer, accountant, banker, Rating Agency or other expert whether obtained by theIssuer, the Representative of the Noteholders or otherwise, provided that, where such lawyer,accountant, banker, Rating Agency or other expert is appointed by the Representative of theNoteholders, such appointment is made with due care, and, subject to the aforesaid, theRepresentative of the Noteholders shall not, in the absence of gross negligence (colpagrave), wilful default or fraud (dolo), be liable for any Liabilities incurred by any party as aresult of the Representative of the Noteholders so acting. Any such advice, certificate oropinion may be obtained by letter, fax or e-mail and the Representative of the Noteholders,in the absence of gross negligence (colpa grave), wilful default or fraud (dolo), shall not beliable for acting on any such letter, fax or e-mail notwithstanding any error contained thereinor non-authenticity of the same;

(ii) save as expressly otherwise provided for in these Conditions and in any other TransactionDocuments, shall have absolute and uncontrolled discretion as to the exercise or nonexercise of any right, power or discretion vested in the Representative of the Noteholders bythese Conditions, the Transaction Documents or by operation of law and shall not beresponsible for any Liabilities that may result from the exercise or non-exercise thereofinsofar as the same are not incurred as a result of its gross negligence (colpa grave), wilfuldefault or fraud (dolo);

(iii) shall be entitled to accept as sufficient evidence of any fact or matter or effectiveness of anytransaction, unless any of its officers in charge of the administration of these Conditions orany Transaction Document are aware or have express notice to the contrary, a certificateduly signed by the Issuer, and the Representative of the Noteholders shall not be bound inany such case to call for further evidence or be responsible for any loss that may beoccasioned by the Representative of the Noteholders, acting on such certificate;

(iv) in relation to the matters in respect of which the Representative of the Noteholders is entitledto exercise any of its rights and discretions hereunder, the Representative of the Noteholders

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is entitled to convene a meeting of the Noteholders of each Class in order to obtain fromthem instructions upon how the Representative of the Noteholders should exercise such rightor discretion. Prior to undertaking such action, the Representative of the Noteholders shallbe entitled to request at the meeting an indemnity and/or security, subject to its approval, inrespect of all actions, proceedings, claims and demands to which it may render itself liableand all costs, charges, damages, expenses and liabilities which it may incur by taking suchaction;

(v) in relation to the matters in respect of which the Noteholders are entitled to direct theRepresentative of the Noteholders, the Representative of the Noteholders shall not be liablefor acting upon any resolution purporting to have been passed at any Meeting of theNoteholders of the relevant Class of Notes in respect whereof minutes have been made andsigned even if, after its service, it emerges that there was some defect in the constitution ofthe Meeting or the passing of the resolution or that for any reason the resolution was notvalid or binding upon such Noteholders;

(vi) may call for, and shall be at liberty to accept and place full reliance on, as suitable evidenceof the facts stated therein, a certificate or letter of confirmation as true and accurate andsigned on behalf of any Monte Titoli Account Holder or common depository, as the casemay be, as the Representative of the Noteholders considers reasonably appropriate, or anyform of record made by any of them to the effect that at any particular time, or throughoutany particular period, any party hereto is, was or will be shown in its records as entitled to adetermined number of Notes;

(vii) may determine whether or not an Event of Default is in its reasonable opinion materiallyprejudicial to the interests of the Noteholders of any Class and any such determination shallbe conclusive and binding upon the Issuer, the Noteholders, the Other Issuer SecuredCreditors and any other party to any of the Transaction Documents;

(viii) may determine whether or not a default in the performance by the Issuer of any obligationunder the provisions of these Conditions or contained in the Notes or any other TransactionDocuments is capable of remedy and, if the Representative of the Noteholders certifies thatany such default is not capable of remedy, such certificate shall be conclusive and bindingupon the Issuer, the Noteholders, the Other Issuer Secured Creditors and any other partyhereto;

(ix) shall be entitled to request and rely upon any certificate or letter of confirmation orexplanation reasonably believed by it to be genuine of any party to the IntercreditorAgreement or any Other Issuer Secured Creditor or any Rating Agency in respect of everymatter and circumstance for which a certificate is expressly provided for hereunder orpursuant to any other Transaction Document or in respect of the rating of the Rated Notesand it shall not be bound in any such case, to call for further evidence, or be responsible forany loss, liability, costs, damages, expenses or inconvenience that may be incurred by itsfailure to do so; and

(x) may, in determining whether any event, matter or thing will not be materially prejudicial tothe interest of the Noteholders and/or the Other Issuer Secured Creditors, have regard, alongwith any other relevant factors, to whether the Rating Agencies (other than Moody’s) haveconfirmed that such event, matter or thing will not result in the withdrawal or reduction of,or entail any other adverse action with respect to, the then current rating of the Rated Notes.

(l) No provision of these Conditions or any Transaction Document shall oblige the Representative ofthe Noteholders to carry out any action which may be illegal or contrary to applicable law orregulations or to act at risk of its own funds or otherwise incur to any financial liability in the

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performance of any of its duties, or in the exercise of any of its rights or powers, if it believes thatreimbursement of such funds is not assured. Therefore, the Representative of the Noteholders mayrefrain from taking or performing any action under these Conditions or any other TransactionDocument if it has grounds to believe that it will not be reimbursed for any funds or indemnified orsecured to its satisfaction by the Noteholders or the Issuer against any Liability which it may incur asa result of such action.

(m) Each of the Noteholders expressly acknowledges and agrees that the Representative of theNoteholders shall not be:

(i) under any obligation to take any steps to ascertain whether an Event of Default, IssuerInsolvency Event or any other event, condition or act, the occurrence of which would causea right or remedy to become exercisable by the Representative of the Noteholders underthese Conditions or any other Transaction Document, has occurred and until it has expressknowledge to the contrary, the Representative of the Noteholders is entitled to assume thatno such event has occurred;

(ii) required to monitor or supervise the performance by the Issuer nor any other party to theTransaction Documents of their obligations and, until it has actual knowledge or receivesexplicit notice to the contrary, the Representative of the Noteholders may assume that nobreach has occurred;

(iii) liable for nor shall it be required to assess the legality, validity, adequacy, effectiveness andenforceability of these Conditions or any other Transaction Document or any otherdocument or obligation or rights created or purported to be created thereby and pursuantthereto and the obligations assumed by the Issuer and any other party to the TransactionDocuments thereunder are legally valid and binding and enforceable against them inaccordance with the respective terms nor shall it be required to assess any breach or allegedbreach by the Issuer or any other party to the Transaction Documents of any of therepresentations, warranties and covenants given or undertaken by them in these Conditionsor any other Transaction Documents;

(iv) deemed to be a person responsible for the collection, cash and payment services for thepurposes of Article 2.6 of the Italian Securitisation Law and the Implementing Regulations;

(v) under any obligation to consider the effect of any amendment of these Conditions or any ofthe Transaction Documents on the financial condition of individual Noteholders or any otherparty to the Transaction Documents;

(vi) under any obligation to disclose (unless and to the extent so required under these Conditions,the terms of any Transaction Documents or by applicable law) to any Noteholder or OtherIssuer Secured Creditors or any other party, any information (including, without limitationinformation of a confidential, financial or price sensitive nature) made available to theRepresentative of the Noteholders by the Issuer or any other person in respect of thePortfolio or, more generally, of the Securitisation and no Noteholder shall be entitled to takeany action to obtain from the Representative of the Noteholders any such information;

(vii) responsible for the receipt or application by the Issuer of any proceeds in relation to theNotes or the distribution of such proceeds to the persons entitled thereto;

(viii) responsible for the maintenance of any rating of the Notes by any rating agencies;

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(ix) responsible for, or for investigating, any matter which is the subject of any recitals,warranties or representations of any party other than the Representative of the Noteholdercontained herein or in any other Transaction Document;

(x) responsible for the adequacy, suitability, or sufficiency of the structure of the Securitisation(legally or otherwise) nor for any collection or recovery procedures operated by the Servicerin respect of the Portfolio and the relevant connected rights; and

(xi) liable for any failure, omission or error in filing or registering any rights, interests or title inand under these Conditions or the Transaction Documents whether such failure or error isdiscovered prior to or on or after issuing the Notes and irrespective of whether such failureor omission can be remedied nor for the failure by the Issuer to obtain or comply with anyauthorisation, licence or consent in connection with the purchase and administration of thePortfolio.

(n) The Issuer shall pay to the Representative of the Noteholders a fee for its services as Representativeof the Noteholders as from the Issue Date. Such fee shall be payable in arrear on each Payment Datein the appropriate proportion in accordance with the relevant Priority of Payments set out in theseConditions and in the Intercreditor Agreement. In the event of the Representative of the Noteholdersconsidering it necessary or being requested by the Issuer to undertake duties which theRepresentative of the Noteholders and the Issuer agree to be of an exceptional nature or otherwiseoutside the duties of the Representative of the Noteholders set out in these Conditions, the Issuershall pay to the Representative of the Noteholders such additional remuneration as shall be agreedbetween them.

(o) The Issuer hereby undertakes to indemnify the Representative of the Noteholders in respect of allproceedings (including claims and liabilities in respect of taxes, other than on its own overall netincome), claims and demands and all costs, charges, expenses, and liabilities to which theRepresentative of the Noteholders (or any person appointed by it, to whom any rights, power,authority or discretion may be delegated by it in the execution or purported execution of the rights,powers, authorities or discretions vested in it by or pursuant to these Conditions, any of theTransaction Documents to which the Representative of the Noteholders is a party, or the Notes) maybe or become liable or which may be incurred by the Representative of the Noteholders (or any suchperson as aforesaid) in respect of any matter or thing done, purported or omitted to be done in anyway relating to these Conditions and any of the other Transaction Documents to which theRepresentative of the Noteholders is a party or the Notes, including but not limited to, properlyincurred legal expenses, reasonable travelling expenses and any attorney’s fees, stamp, issue,registration, documentary and other taxes or duties due to be paid by the Representative of theNoteholders in connection with any action and/or legal proceedings brought against or contemplatedby the Representative of the Noteholders pursuant to the Transaction Documents, or against theIssuer or any other person for enforcing any obligations under the Notes or any other of theTransaction Documents, other than as a result of the Representative of the Noteholders’ grossnegligence (colpa grave), and/or wilful default and/or fraud (dolo).

(p) Upon service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, theRepresentative of the Noteholders shall, pursuant to the terms of the Intercreditor Agreement and theMandate, be entitled, in its capacity as representative of the Noteholders, also in the interest and forthe benefits of the Other Issuer Secured Creditors, pursuant to Articles 1411 and 1723, secondparagraph of the Italian Civil Code, to exercise certain rights in relation to the Portfolio pursuant tothe Transaction Documents and in particular, to dispose of the Portfolio in accordance with theseConditions. Therefore, the Representative of the Noteholders will be authorised, pursuant to theterms of the Intercreditor Agreement and the Mandate therein, to exercise, in the name and on behalfof the Issuer and as mandatario in rem propriam of the Issuer, all and any of the Issuer’s rights,

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including the right to give directions and instructions to the relevant parties to the TransactionDocuments.

(q) The Issuer covenants with, and undertakes to the Representative of the Noteholders, that it will:

(i) from time to time, upon reasonable demand, execute, at its own cost, any document or doany act or thing which the Representative of the Noteholders may specify with a view to:

(a) perfect or improve or otherwise protect any charge or security created or intended to becreated by any Issuer Security Document, including, without limitation, such additionalor related security document in such form as the Representative of the Noteholders mayspecify; and/or

(b) upon an Issuer Enforcement Notice being served upon the Issuer, facilitate the exercise,or the proposed exercise, of any of the powers of the Representative of the Noteholders(including, without limitation, any proxy which may be necessary for the sale of thePortfolio or disposal of any other asset of the Issuer by or on behalf of theRepresentative of the Noteholders or pursuant to the security created or purported to becreated by any Issuer Security Document);

(ii) from time to time, upon demand, give or join in giving or procure the giving of such noticesand intimations to such persons, and all in such form, as the Representative of theNoteholders may require, at the cost of the Issuer;

(iii) appoint a firm of independent auditors prior to the Issue Date;

(iv) at all times keep, or procure the keeping of, proper corporate books and books of accountand records, and to permit the Representative of the Noteholders access to such books ofaccount and such records at all times,

PROVIDED THAT if the Issuer for any reason fails to observe or punctually perform any of itsobligations under these Conditions, the Transaction Documents or otherwise, the Representative ofthe Noteholders shall have the power (but not the obligation), in the name and on behalf of theIssuer, or otherwise, to perform any such obligation and to take any steps which the Representativeof the Noteholders may, in its absolute discretion, consider appropriate with a view to remedying, ormitigating the consequences of, such failure.

15. LISTING

Application has been made to list the Rated Notes on the Irish Stock Exchange. The Class Z Notes shall notbe listed on any stock exchange.

16. NOTICE TO NOTEHOLDERS

(a) Any notice regarding the Notes of any Class to the Noteholders of any Class shall be deemed to bevalidly given, unless provided otherwise by law, by being published through the Monte Titoli systemand (for so long as the Rated Notes of any Class are listed on the Irish Stock Exchange and the rulesof that exchange so require) in the Company Announcement Office of the Irish Stock Exchangeand/or in a leading newspaper having general circulation in Ireland (which is expected to be the IrishTimes).

(b) Any notice specifying a Payment Date, a Rate of Interest, an Interest Payment Amount, a PrincipalPayment, a Principal Amount Outstanding or that an Issuer Enforcement Notice has been served oran Issuer Insolvency Event has occurred shall also appear on a Reuters Screen Page or such other

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medium for the electronic display of data as may be approved by the Representative of theNoteholders.

(c) The Representative of the Noteholders shall be at liberty to sanction some other method of givingnotice to the Noteholders of any Class if, in its opinion, such other method is reasonable havingregard to market practice then prevailing and to the rules of the stock exchange on which the RatedNotes or any Class of them are then listed and provided that notice of such other method is given tothe Noteholders in such manner as the Representative of the Noteholders shall require.

(d) A copy of each notice given in accordance with this Condition 16 (Notice to the Noteholders) shallbe provided to Monte Titoli, the Rating Agencies and, for so long as the Notes are listed on the StockExchange and the rules of that exchange so require, the Stock Exchange. Notice to Monte Titoli shallbe delivered by the Issuer in accordance with the provisions of Resolution No. 11768.

(e) Any such notice shall be deemed to have been given on the date of such publication (or on the dateof delivery to Monte Titoli in accordance with Resolution No. 11768) or, if published or deliveredmore than once or on different dates on the first date on which publication (or delivery to MonteTitoli) is made.

(f) The Issuer shall provide the Representative of the Noteholders, the Italian Paying Agent and theAdditional Paying Agent with four copies of:

(i) as soon as they become publicly available, its audited annual financial reports (includingbalance sheet, profit and loss and cash flow statements) together with the related auditors’report; and

(ii) no later than ten Business Days following each Payment Date, the Quarterly InvestorsReport (unless it has not been already sent by the Calculation Agent).

The audited annual financial statements (together with the related auditors’ report) and the QuarterlyInvestors Report shall be available for inspection by the Noteholders on any Business Day at thespecified office for the time being of the Paying Agents.

17. AMENDMENTS, WAIVERS AND CONSENTS

(a) The Representative of the Noteholders, without the consent of the Noteholders of any Class, mayagree to any modification or amendment of these Conditions, or any of the Transaction Documentswhich in the Representative of the Noteholders’ opinion (except for a Basic Terms Modification): (i)is to correct a manifest error, or if such modification or amendment is of a formal, minor or technicalnature; or (ii) is not materially prejudicial to the interests of the Noteholders of any Class, providedthat the Representative of the Noteholders may not agree to any such modification which may bematerially prejudicial to the interests of the Other Issuer Secured Creditors, without their priorwritten consent.

(b) The Representative of the Noteholders, without the consent of the Noteholders of any Class, mayagree to: (i) the waiver or authorisation of any Event of Default, any breach or proposed breach; or(ii) as required, the exercise of any discretion or giving of any consent by the Issuer, in each caseunder (i) and (ii), in relation to such of these Conditions as are governing the interests of the relevantClass of Noteholders, or any of the Transaction Documents, provided that in the sole opinion of theRepresentative of the Noteholders, such waiver or authorisation or exercise of discretion or giving ofconsent is not materially prejudicial to the interests of the Noteholders of the relevant Class.

(c) Any amendment, modification, waiver, authorisation, exercise of discretion or giving of consentmade pursuant to (a) or (b) above shall be binding on the Noteholders of each Class and, unless the

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Representative of the Noteholders agrees otherwise, shall be notified to the Noteholders of eachrelevant Class in accordance with Condition 16 (Notice to Noteholders) and to the Rating Agenciesas soon as practicable thereafter.

(d) In the event that, for the purposes of this Condition 17 (Amendments, Waivers and Consents), theRepresentative of the Noteholders is of the opinion that any matter is materially prejudicial to theinterests of the Noteholders of any Class, only the consent of the Noteholders of the relevant Classshall be required thereto. The Representative of the Noteholders may, in determining whether anyevent, matter or thing will not be materially prejudicial to the interest of the Noteholders and/or theOther Issuer Secured Creditors, have regard, along with any other relevant factors, to whether theRating Agencies (other than Moody’s) have confirmed that such event, matter or thing will not resultin the withdrawal or reduction of, or entail any other adverse action with respect to, the then currentrating of the Rated Notes.

(e) Any consent or approval given by the Representative of the Noteholders under these Conditions andany other Transaction Document may be given on such terms and subject to such conditions (if any)as the Representative of the Noteholders determines necessary and notwithstanding anything to thecontrary contained herein, or in such other Transaction Document, such consent or approval may begiven with retrospective effect.

(f) Subject as provided above:

(i) no modification of any Transaction Document shall be valid unless: (i) it is in writing andsigned by or on behalf of each of the parties to the relevant Transaction Document; and(ii) prior notification is made to the Rating Agencies of such modification.

(ii) unless expressly agreed otherwise, no amendment, modification or variation shall constitutea general waiver of any provisions of these Conditions or any Transaction Document, norshall it affect any rights or obligations under or pursuant to these Conditions or anyTransaction Document which have already accrued up to the date of variation, and the rightsand obligations of the Noteholders and/or the Transaction Parties under or pursuant to theseConditions and/or such Transaction Document shall remain in full force and effect, exceptand only to the extent that they are so varied.

18. DETERMINATIONS CONCLUSIVE

All notifications, opinions, determinations, certificates, calculations, quotations and decisions given,expressed, made or obtained for the purposes of these Conditions, whether by the Reference Banks (or any ofthem), the Cash Manager, the Calculation Agent, the Issuer, the Paying Agents or the Representative of theNoteholders shall, in the absence of manifest error, be binding on the Reference Banks (or any of them), theCash Manager, the Calculation Agent, the Issuer, the Paying Agents or the Representative of the Noteholdersand on all the Noteholders and the Other Issuer Secured Creditors and (in the absence of wilful default orfraud (dolo) or gross negligence (colpa grave)) no liability to the Noteholders shall attach to such ReferenceBank(s), the Cash Manager, the Calculation Agent, the Issuer, the Paying Agents or the Representative of theNoteholders in connection with the exercise or non-exercise by them or any of them of their powers, dutiesand discretions hereunder.

19. NON-PETITION AND LIMITED RECOURSE

(a) Without prejudice to (i) the right of the Representative of the Noteholders to enforce the IssuerSecurity or to exercise any of its other rights or remedies under the Transaction Documents, and (ii)the rights of the individual Noteholders under Condition 12 (Enforcement), none of the Noteholdersshall be entitled to institute against the Issuer, or join any other person in instituting against theIssuer, any reorganisation, liquidation, bankruptcy, Insolvency Proceedings or similar proceedings

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until one year and one day has elapsed since the day on which the Notes and the Further Notes (ifany) have been paid (or cancelled) in full.

(b) None of the Noteholders or any Other Issuer Secured Creditor will have any right or entitlement tothe Issuer’s assets other than such of the proceeds of the Issuer Security and the Portfolio and theother Securitisation Assets as are available to the Issuer for this purpose in accordance with theseConditions and the Transaction Documents. Each Noteholder and each Other Issuer SecuredCreditor further acknowledges that the limited recourse nature of the Notes produces the effect underItalian law of a “contratto aleatorio” and accepts the consequences thereof, including theconsequences of Article 1469 of the Italian Civil Code.

(c) If:

(i) following the service of an Issuer Enforcement Notice or the occurrence of an IssuerInsolvency Event and following the enforcement of the Issuer Security and the exercise bythe Representative of the Noteholders or any other person so entitled to direct the Issuerand/or to take any action in respect of the Portfolio and any asset or amount derivedtherefrom; or

(ii) on the Maturity Date no Issuer Enforcement Notice has been served or Issuer InsolvencyEvent has occurred,

the aggregate funds available to the Issuer in accordance with the provisions of the relevant Priorityof Payments for application in or towards any payment obligation (for the purposes of thisCondition 19 (Non-Petition and Limited Recourse), the “Relevant Obligation”) on the Notes withinany Class (for the purposes of this Condition 19 (Non-Petition and Limited Recourse), the “RelevantNotes”) or in respect of any obligation owed to any Transaction Party under any TransactionDocument (for the purposes of this Condition 19 (Non-Petition and Limited Recourse), the“Relevant Document”) which, but for the operation of this Condition 19 (Non-Petition and LimitedRecourse), would be due and payable, are not sufficient to pay in full the aggregate amount which,but for the operation of this Condition 19 (Non-Petition and Limited Recourse), would be due andpayable on the Relevant Notes or under the Relevant Document in respect of the RelevantObligations on the relevant date, then, notwithstanding any other provision in these Conditions or ofany Transaction Document, only a pro rata share of the funds which are available to make paymentsin respect of the Relevant Obligation on the Relevant Notes or under the Relevant Document, as thecase may be, shall be due and payable on any Relevant Note or under the Relevant Document,respectively, on the relevant date subject to and in accordance with the applicable Priority ofPayments and the balance of the amount outstanding in respect of the Relevant Obligation on theRelevant Notes or under the Relevant Document which, but for the operation of this Condition 19(Non-Petition and Limited Recourse), would be due and payable, shall cease to be due and payableand shall be definitively cancelled.

(d) The pro rata amount due and payable in respect of any Relevant Obligation under the RelevantNotes shall be calculated by multiplying the amounts available to make payments in respect of theRelevant Obligation on the Relevant Note by a fraction, the numerator of which is the PrincipalAmount Outstanding of such Relevant Note and the denominator of which is the aggregate PrincipalAmount Outstanding of all the Relevant Notes of the relevant Class, rounding down the resultantfigure to the nearest Euro cent.

20. GOVERNING LAW

(a) The Notes and, except as specified in (b) below, all the Transaction Documents are governed by, andshall be construed in accordance with, Italian law.

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(b) The Hedging Agreements and the Deed of Charge are governed by, and shall be construed inaccordance with, English law.

21. JURISDICTION

(a) For any disputes regarding the Notes and, except as specified in (b) below, all the TransactionDocuments, the Italian courts shall have exclusive jurisdiction.

(b) For disputes regarding the Interest Rate Swap Agreement and the Deed of Charge, the English courtsshall have jurisdiction.

22. MISCELLANEOUS

The holding of a Note by any person constitutes the full acceptance by such person of all the provisions setout in, referred to and/or incorporated by reference in these Conditions including, without limitation, theMandate.

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EXPECTED MATURITY AND EXPECTED AVERAGE LIFE OF THE RATED NOTES

The weighted average life of the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes, theClass E Notes and the Class Z Notes cannot be predicted, as the actual rate at which the Loans will be repaidand a number of other relevant factors are unknown (see Risk Factors).

The model used in this document for the Loan Receivables comprised in the Portfolio represents an assumedconstant per annum rate of prepayment (“CPR”) each month relative to the then outstanding PortfolioPrincipal Balance of such Loans. CPR does not purport to be either a historical description of the prepaymentexperience of any pool of mortgage loans or a prediction of the expected rate of prepayment of mortgageloans, including the Loans included in the Portfolio.

The table below shows the expected weighted average life of the Class A Notes, the Class B Notes, the ClassC Notes, the Class D Notes and the Class E Notes, in each case, in years, based, among other things, on thefollowing assumptions:

(i) the Issuer will redeem all, but not some only of, the Notes at their Redemption Value in accordancewith the Enforcement Priority of Payments on the First Put Date, subject as provided inter alia inCondition 7(e) (Redemption of the Notes at the option of Put Option Noteholders);

(ii) redemption of the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes will start on the First Amortisation Payment Date;

(iii) at the time the aggregate Principal Amount Outstanding of the Class B Notes and the Class C Notes,the Class D Notes and the Class E Notes as a percentage of the aggregate Principal AmountOutstanding of the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes and theClass E Notes is at least twice of such percentage as calculated on the Issue Date, all the other Prorata Amortisation Conditions will be satisfied;

(v) there will be no Defaulted Loan Receivables nor Delinquent Instalments;

(vi) the Issue Date will fall on 21 December 2007.

The actual characteristics and performance of the Loans are likely to differ from the assumptions used inconstructing the table set forth below, which is hypothetical in nature and is provided only to give a generalsense of how the cash flows might behave under varying prepayment scenarios. For example, it is notexpected that the Loans will prepay at a constant rate until maturity, that all of the Loans will prepay at thesame rate or that there will be no defaults or delinquencies on the Loans. Indeed, as at the date of thisdocument, certain of the Loans in the Portfolio may be in arrears. Any difference between such assumptionsand the actual characteristics and performance of the Loans will cause the weighted average life of the Notesto differ (which difference could be material) from the corresponding information in the tables for eachindicated percentage of CPR.

Expected Weighted Average Life of the Rated Notes

0%CPR

3%CPR

6%CPR

9%CPR

12%CPR

Class A Notes 6.90 6.38 5.90 5.46 5.05

Class B Notes 7.23 7.23 7.23 7.23 7.23

Class C Notes 7.23 7.23 7.23 7.23 7.23

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0%CPR

3%CPR

6%CPR

9%CPR

12%CPR

Class D Notes 7.23 7.23 7.23 7.23 7.23

Class E Notes 3.13 3.30 3.52 3.76 3.98

The expected average life of the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes andthe Class E Notes is subject to factors largely outside the control of the Issuer and consequently no assurancecan be given that the assumptions and estimates above will prove in any way to be realistic and they musttherefore be viewed with caution.

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TAXATION

The following is a general description of current Italian tax law and ministerial practice relating to the Notesconcerning to the purchase, ownership and disposition of the Notes. It does not purport to be a completeanalysis of all tax considerations that may be relevant to a decision to purchase, own or dispose of the Notesand does not purport to deal with the tax consequences applicable to all categories of prospective beneficialowners of Notes, some of which may be subject to special rules. In particular, this summary does not discussthe treatment of Notes that are held in connection with a permanent establishment or fixed base establishedin Italy through which a non-Italian resident beneficial owner carries on business or performs professionalservices in Italy.

This summary is based upon Italian tax laws and ministerial practice in effect as at the date of thisProspectus, which may be subject to change, potentially with retroactive effect. The Issuer will not updatethis summary to reflect changes in law, as well as any other change in any tax regulation and/or practise and,if any such change occurs, the information in this summary could become invalid.

The Italian Government may in the near future be authorised by Italian Parliament to introduce a generalreform of the tax regime of the financial income, that may impact on the current tax regime in respect of theNotes, as summarized below. In particular, the Italian government may, inter alia, raise the rate applicable towithholding tax on interest payments as well as the rate of Italian substitute tax (imposta sostitutiva) to 20per cent in lieu of the two existing of withholding rates of 12,5 per cent and 27 per cent. However, bill ofdelegation law (disegno di legge delega) No. 1762 (the Bill) has not been approved yet by the ItalianParliament and there are no precise indications at present as to whether and how the Bill will be finallyapproved. Therefore, we cannot anticipate for the time being the possible impact of the pending draftlegislation of the tax regime as described here below.

Prospective Noteholders should consult their tax advisers as to the consequences under Italian tax law, underthe tax laws of the country in which they are resident for tax purposes and of any other potentially relevantjurisdiction of acquiring, holding and disposing of Notes and receiving payments of interest, principal and/orother amounts under the Notes, including in particular the effect of any state, regional or local tax laws.

INTEREST, PREMIA AND OTHER PROCEEDS PAYABLE ON THE NOTES

Italian Resident Noteholders

Pursuant to the Law 239 dated a substitute tax (imposta sostitutiva) levied at the rate of 12.5 per cent. iscurrently applicable to interest, premia and any other proceeds in respect of the Notes (the “Interest”) ifreceived by an Italian resident beneficial owner of the Notes which is (i) an individual not engaged in abusiness activity to which the Notes are effectively connected (unless such individual has entrusted themanagement of his financial assets, including the Notes, to an authorised intermediary and has opted for theso-called Risparmio Gestito regime according to article 7 of Legislative Decree No. 461 of 21 November,1997 as amended (“Decree 461 – The Asset Management Option”), (ii) a partnership (other than a societàin nome collettivo or società in accomandita semplice or similar partnership) or a de facto partnership notcarrying out commercial activities or professional associations, (iii) a non-commercial private or publicinstitution, or (iv) an investor exempt from corporate income tax. The imposta sostitutiva is a final tax anddischarges any other Italian income tax liabilities in respect of the Interest. If the Noteholders describedunder (i) and (iii) above are engaged in an entrepreneurial activity to which the Notes are connected, impostasostitutiva applies as a provisional tax.

Pursuant to Law 239, imposta sostitutiva is applied by banks, società di intermediazione mobiliare (“SIMs”),società di gestione del risparmio (“SGR”), fiduciary companies, agenti di cambio (exchange agents) andother qualified entities identified by the relevant decrees of the Ministry of Finance (the “Intermediaries”and each an “Intermediary”). For the Intermediaries to be entitled to apply the imposta sostitutiva, theymust (i) be (a) resident in Italy or (b) resident outside Italy, with a permanent establishment in Italy or (c)

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organisations and companies non-resident in Italy, acting through a system of centralised administration ofsecurities and directly connected with the Department of Revenue of the Ministry of Finance (which includeEuroclear and Clearstream) having appointed an Italian representative for the purposes of Law 239; and (ii)be involved, in any way, in the collection of interest or in the transfer of the Notes. For the purpose of theapplication of imposta sostitutiva, a transfer of Notes includes any assignment or any other act, either with orwithout consideration, which results in a change of the ownership of the relevant Notes or in a change of theIntermediary with which the Notes are deposited.

Italian resident individuals holding Notes not in connection with entrepreneurial activity who have opted forthe Asset Management Option are subject to a 12.5 per cent annual substitutive tax on the increase in valueof the managed assets accrued at the end of each tax year (which increase would include any interest andother proceeds accrued on the Notes). The above 12.5 per cent substitute tax is applied on behalf of thetaxpayer by the managing authorised intermediary. In case the resident holders of the Notes described aboveunder (i) and (iii) are engaged in an entrepreneurial activity to which the Notes are connected, impostasostitutiva applies as an advance income tax and may be deducted from the final income tax.

No imposta sostitutiva is applicable on Interest payable to Italian resident corporate entities or to permanentestablishments in Italy of foreign corporations holding the Notes, provided that the Notes are deposited withan authorised financial intermediary. Interest on the Notes must be included, on an accrual basis, in theaggregate taxable income of the Noteholders for corporation tax purposes (“IRES”, levied at the rate of 33per cent.). Where the investor is a bank or other financial entity subject to Article 6 of the Decree dated 15December 1997 No 446, Interest accrued on the Notes must also be included in the net value of productionsubject to regional tax on productive activities (“IRAP”, generally levied at the rate of 4.25 per cent., eventhough regional surcharges may apply).

No imposta sostitutiva is applicable on Interest payable to Italian pension funds (subject to the regimeprovided by Article 17, paragraph 1 of Legislative Decree No. 252 of 5 December 2005) and to Italiancollective investment funds, provided that the Notes are deposited with an authorised financial intermediary.Interest on the Notes must be included in the calculation of the management result of the fund accrued atyear end, which is subject to a substitute tax at the rate of 11 per cent. (the latter being the “Pension FundTax”) in case of pension funds or to a substitute tax at the rate of 12.5 per cent. in case of Italian collectiveinvestment funds (the latter being the “Mutual Fund Tax”).

No imposta sostitutiva is applicable on Interest payable to Italian real estate investment funds to which theprovisions of Law Decree No. 351 of 25 September 2001, as subsequently amended, apply, provided that theNotes are deposited with an authorised financial intermediary. The income of such real estate investmentfunds (which includes the Interest on the Notes) is in principle taxed in the hands of the participants to thefund on a cash basis (i.e. upon collection of the proceeds derived from the investment).

Where the Notes are not deposited with an Intermediary, the imposta sostitutiva is applied and withheld byany entity paying Interest to a Noteholder.

Non-Italian Resident Noteholders

An exemption from imposta sostitutiva applies with respect to certain beneficial owners of the Notes residentoutside of Italy. In particular, pursuant to Law 239, as amended, the aforesaid exemption will apply to anybeneficial owner of a payment of any Interest in favour of a Noteholder relating to the Notes who (i) isresident, for fiscal purposes, in a country which allows for an adequate exchange of information, (ii) is aninternational entity or organization set up in accordance with international agreements ratified in Italy, (iii) isthe Central Bank or an entity also authorised to manage the official reserves of a State, or (iv) is a foreigninstitutional investor which is established in a country which allows for a satisfactory exchange ofinformation, even if it is not a taxpayer in its own country of establishment. According to rulings No. 20/Edated 27 March 2003 and No. 23/E dated 1 March 2002, Luxembourg holding companies regulated byLuxembourg Law 31 July 1929, (as amended from time to time), do not qualify as institutional investors.

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Countries which recognise the Italian tax authorities’ right to an adequate exchange of information, are, interalia, those included in the list provided by Ministerial Decree dated 4 September 1996 (as subsequentlyamended). Such decree includes, amongst others, all members of the European Union, Australia, Brazil,Canada, Japan and the United States of America, but excludes, amongst others, Switzerland and Cyprus.

The exemption procedure for Noteholders, who are non-resident in Italy but resident in qualifying countries,identifies two categories of intermediaries:

(i) an Italian bank or financial institution, or a permanent establishment in Italy of a non-resident bankor financial institution (there is no requirement for the bank or financial institution to be EU resident)(the “First Level Bank”), acting as intermediary in the deposit of the Notes held, directly orindirectly, by the Noteholder with a Second Level Bank (as defined below); and

(ii) an Italian resident bank or SIM, or a permanent establishment in Italy of a non-resident bank or SIM,acting as depositary or sub-depositary of the Notes, appointed to maintain direct relationships, viatelematic link, with the Italian fiscal authorities (the “Second Level Bank”). Organisations andcompanies that are non-resident in Italy, acting through a system of centralised administration ofsecurities and directly connected with the Department of Revenue of the Ministry of Finance (whichinclude Euroclear and Clearstream) are treated as Second Level Banks, provided that they appoint anItalian representative (an Italian resident bank or SIM, a permanent establishment in Italy of a non-resident bank or SIM, or a company which provides for the centralised management of securities incompliance with Art. 80 of Decree dated 24 February 1998 No. 58) for the purposes of theapplication of Law 239.

In the event that a non-Italian resident Noteholder deposits the Notes directly with a Second Level Bank, thelatter shall be treated both as a First Level Bank and a Second Level Bank.

The exemption from the imposta sostitutiva of non Italian resident Noteholders with no permanentestablishment in Italy to which the Notes are effectively connected, applies, provided that non Italian residentinvestors indicated above:

(i) are the beneficial owners of payments of Interest on the Notes:

(ii) timely deposit the Notes, either directly or indirectly, with an institution which qualifies as a SecondLevel Bank; and

(iii) timely submit to the First Level Bank or the Second Level Bank a self-declaration(autocertificazione) of the relevant Noteholder, valid until revocation, required by Law 239 and inwhich it declares, inter alia, that he or she is resident, for tax purposes, in a country whichrecognises the Italian fiscal authorities’ right to an adequate exchange of information. Suchstatement must comply with the requirements set forth by a Ministerial Decree dated 12 December2001. This certificate is not required for non-Italian investors that are international entities andorganization set up in accordance with international agreements ratified in Italy and Central Banks orentities which manage, inter alia, the official reserves of a foreign state.

Failure of a non-resident Noteholder to timely comply with the procedures set forth in Law 239 and in therelevant implementation rules will result in the application of imposta sostitutiva on Interest payments to anon-resident Noteholder. The 12.5 per cent imposta sostitutiva may be reduced (generally to 10 per cent)under certain applicable double tax treaties entered into by Italy, if more favourable, provided that certaindocumentation formalities are complied with.

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CAPITAL GAINS ON THE DISPOSAL OR REDEMPTION OF THE NOTES

Italian Resident Noteholders

Pursuant to Decree 461, a 12.5 per cent substitute tax (referred to as capital gain tax) is applicable to capitalgains realised by Italian resident individuals not engaged in entrepreneurial activities to which the Notesissued by the Issuer are connected, on any sale or transfer for consideration of the Notes or redemptionthereof.

In respect of the application of this capital gain tax, taxpayers may opt for one of the three regimes describedbelow.

Under the tax declaration regime (regime della dichiarazione), which is the default regime for the taxation ofcapital gains realised by Italian resident individuals not engaged in an entrepreneurial activity, the 12,5 percent capital gain tax on capital gains will be chargeable, on a yearly cumulative basis, on all capital gains, netof any incurred capital losses, realised by the Italian resident individual Noteholder, holding Notes not inconnection with an entrepreneurial activity, in any sale or redemption of the Notes which occurs during anygiven tax year. Italian resident individuals holding the Notes not in connection with an entrepreneurialactivity must indicate the overall capital gains realised in any tax year, net of any relevant incurred capitallosses, in the annual tax return and pay capital gain tax on such gains together with any balance due inrespect of income tax due for such year. Capital losses in excess of capital gains may be carried forwardagainst capital gains of the same kind realised in any of the four succeeding tax years.

As an alternative to the tax declaration regime, Italian resident individual Noteholders holding the Notes notin connection with an entrepreneurial activity may elect to pay the capital gain tax separately on capital gainsrealised on each sale or redemption of the Notes (the risparmio amministrato regime provided for by article6 of Decree 461). Such separate taxation of capital gains is allowed subject to:

(i) the Notes being deposited with Italian banks, società di intermediazione mobiliare (SIM) or certainauthorised financial intermediaries; and

(ii) an express election for the risparmio amministrato regime being made in writing in due time by therelevant Noteholder.

The intermediary is responsible for accounting for capital gain tax in respect of capital gains realised on eachsale or redemption of the Notes (as well as in respect of capital gains realised upon the revocation of itsmandate), net of any incurred capital losses, and is required to pay the relevant amount to the Italian taxauthorities on behalf of the taxpayer, deducting a corresponding amount from the proceeds to be credited tothe Noteholder or using funds provided by the Noteholder for this purpose. Under the risparmioamministrato regime, where a sale or redemption of the Notes results in a capital loss, such loss may bededucted from capital gains of the same kind subsequently realised, within the same relationship of deposit,in the same tax year or in the four succeeding tax years. Under the risparmio amministrato regime, theNoteholder is not required to declare the capital gains in its annual tax return and the Noteholder remainsanonymous.

Any capital gains realised by Italian resident individuals holding the Notes not in connection with anentrepreneurial activity who have opted for the Asset Management Option will be included in thecomputation of the annual increase in value of the managed assets accrued, even if not realised, at year end,subject to a 12.5 per cent. capital gain tax, to be paid by the managing authorised intermediary. Under theAsset Management Option, any depreciation of the managed assets accrued at year end may be carriedforward against increase in value of the managed assets accrued in any of the four succeeding tax years. Alsounder the Asset Management Option, the Noteholder is not required to declare the capital gains realised in itsannual tax return and the Noteholder remains anonymous.

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Any capital gain realised upon the sale or redemption of the Notes would be treated as part of the taxablebusiness income (and, in certain circumstances, depending on the “status” of the Noteholder, also as part ofthe net value of the production for IRAP purposes) subject to tax in Italy according to the relevant taxprovisions if derived by an Italian company or a similar commercial entity (including an Italian permanentestablishment of a foreign entity to which the Notes are effectively connected) or Italian resident individualsengaged in an entrepreneurial activity, as to any capital gains realised within the scope of the commercialactivity carried out.

Any capital gains realised by a Noteholder which is an Italian collective investment fund or a SICAV will beincluded in the result of the relevant portfolio accrued at the end of the tax period and will be subject to theMutual Fund Tax.

Capital gains on the Notes held by real estate investment funds to which the provisions of Law Decree No.351 of 25 September 2001, as subsequently amended, apply, are not subject to capital gain tax: no tax islevied on the aggregate income of the real estate fund.

Any capital gains realised by a Noteholder which is an Italian pension fund (subject to the regime providedfor by for by article 17, paragraph 1 of Legislative Decree No. 252 of 5 December 2005) will be included inthe results of the relevant portfolio accrued at the end of the tax period and will be subject to Pension FundTax.

Non-Italian Resident Noteholders

The 12.5 per cent capital gain tax may in certain circumstances be payable on any capital gains realised uponsale, transfer or redemption of the Notes by non-Italian resident individuals and corporations without apermanent establishment in Italy to which the Notes are effectively connected, if the Notes are held in Italy.

However, pursuant to Article 23 of Presidential Decree No. 917 of 22 December 1986, as amended fromtime to time, any capital gains realised by non-Italian residents without a permanent establishment in Italy towhich the Notes are effectively connected through the sale for consideration or redemption of the Notes areexempt from taxation in Italy to the extent that the Notes are listed on a regulated market in Italy or abroad,and in certain cases subject to timely filing of required documentation (in the form of a self-declaration ofnon-residence in Italy) with Italian qualified intermediaries (or permanent establishments in Italy of foreignintermediaries) with which the Notes are deposited, even if the Notes are held in Italy and regardless of theprovisions set forth by any applicable double tax treaty.

If the Notes are not listed on a regulated market in Italy or abroad:

(i) capital gains realised upon sale for consideration or redemption of the Notes by non-Italian residentbeneficial owners of the Notes with no permanent establishment in Italy to which the Notes areeffectively connected are exempt from the capital gain tax in the Republic of Italy if they areresident, for tax purposes, in a country which recognises the Italian tax authorities right to anadequate exchange of information. Under this circumstance, if the non-Italian resident beneficialowners without a permanent establishment in Italy to which the Notes are effectively connected fallunder the risparmio amministrato regime or the Asset Management Option, the exemption from thecapital gain tax will apply on the condition that they file in time an appropriate self-declarationwithin the relevant time limit with the authorised financial intermediary stating that they are residentin a country which allows an adequate exchange of information; and.

(ii) in any event, non-Italian resident persons or entities without a permanent establishment in Italy towhich the Notes are effectively connected that may benefit from a double taxation treaty with theRepublic of Italy, providing that capital gains realised upon the sale or redemption of the Notes areto be taxed only in the country of tax residence of the recipient, will not be subject to the capital gaintax in the Republic of Italy on any capital gains realised upon sale for consideration or redemption of

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Notes. In such a case, if the non-Italian resident persons or entities without a permanentestablishment in Italy to which the Notes are effectively connected fall under the risparmioamministrato regime or the Asset Management Option, the exemption from Italian capital gains taxwill apply on the condition that they file the appropriate documents within the relevant time limitwith the authorised financial intermediary which include, inter alia, a statement from the competenttax authorities of the country of residence of the non-Italian residents.

EARLY REDEMPTION OF THE NOTES

Without prejudice to the above provisions, in the event that the Notes, having an original maturity ofeighteen months or more, are subject to early redemption in whole or in part, within eighteen months fromthe Issue Date, the Issuer will be will be required to pay an additional amount equal to 20 per cent. in respectof the Interest accrued on the early redeemed Notes up to the time of the early redemption, in accordancewith the provisions of Article 26 of Decree No. 600 dated 29 September 1973. In accordance with oneinterpretation of Italian tax law, also in the event of purchase of Notes by the Issuer with subsequentcancellation thereof prior to eighteen months from the date of issue, the Issuer may be required to pay theabove 20 per cent additional amount.

Transfer Tax on the Sale of the Notes (Tassa sui contratti di borsa)

Pursuant to Law Decree no. 435 dated 21 November 1997 and Ministerial Circular no. 106/E dated 21December 2001, any sale of the Notes executed in Italy may trigger the application of Italian transfer taxeither (i) at the rate of € 0.0083 for each € 51.65 of the purchase price (or fraction thereof) or (ii) if a bank oran entity authorised to carry on investment services in accordance with Italian laws intervenes in the saletransaction, at the rate of € 0.00465 for each € 51.65 of the purchase price (or fraction thereof) provided that,in the latter case, the amount of the transfer tax due in a sale transaction will not exceed € 929.62 per salecontract.

In general, transfer tax is not levied, inter alia, in the following cases:

(i) contracts relating to listed securities entered into on regulated markets (e.g. the Irish StockExchange);

(ii) contracts relating to securities which are admitted to listing on regulated markets and finalisedoutside such markets and entered into:

(a) between banks or SIMs or other professional intermediaries authorised to performinvestment services, pursuant to Legislative Decree No. 415 of 23 July 1996, as supersededby Legislative Decree No. 58 of 24 February 1998, or stockbrokers among themselves;

(b) between authorised intermediaries as referred to in paragraph (a) above and non-Italianresidents;

(c) between authorised intermediaries as referred to in paragraph (a) above, also non-Italianresident, and undertakings for collective investment of saving income;

(iii) contracts relating to public sale offers for the admission to listing on regulated markets or relating tofinancial instruments already admitted to listing on said markets;

(iv) contracts for a consideration of less than €206.58; and

(v) contracts regarding securities not listed on a regulated market entered into between authorisedintermediaries as referred to in (ii)(a) above, on the one hand, and non-Italian residents, on the otherhand.

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For transfer tax purposes, transfers of the Notes to or by Italian residents are deemed to be executed in Italyby presumption of law. Moreover, contracts of transfer of Notes executed outside Italy between non-Italianresidents will have juridical effect (efficacia giuridica) in Italy to the extent that transfer tax is paid.

INHERITANCE AND GIFT TAX

Pursuant to Law Decree No. 262 of 3 October 2006 (converted into law by Law No. 286 of 24 November2006), the transfer of any asset of value (including shares, bonds or other securities) as a result of death ordonation are taxed as follows:

(i) transfers in favour of spouses and direct descendants are subject to an inheritance and gift taxapplied at a rate of 4 per cent. to the extent that the value of the inheritance or gift exceeds€1,000,000;

(ii) transfers in favour of relatives up to the fourth degree and relatives-in-law to the third degree aresubject to an inheritance and gift tax applied at a rate of 6 per cent. on the entire value of theinheritance or gift; and

(iii) any other transfer is subject to an inheritance and gift tax applied at a rate of 8 per cent. on the entirevalue of the inheritance or gift.

EU SAVINGS TAX DIRECTIVE

On 3 June 2003, the Council of the European Union adopted a Directive (Council Directive 2003/48/EC,published in the Official Journal of the European Union dated 26 June 2003) on the taxation of savingsincome under which Member States will generally be required to provide the tax authorities of anotherMember State with details of payments of interest or other similar income paid by a person within itsjurisdiction to an individual resident in that other Member State. Exceptionally, unless they elect otherwise(and for a transitional period only, which will end after an agreement on the exchange of information isreached between the European Union and certain non-European Union states), each of Belgium,Luxembourg and Austria will instead be required to collect a specific tax from such payments unless theNoteholder within its jurisdiction authorises the person making the payment to report the payment orpresents a certificate from the relevant tax authority establishing exemption therefrom. Italy has implementedthe EU Savings Directive through Legislative Decree No. 84 of 18 April, 2005 (“Decree No. 84”). UnderDecree No. 84, subject to a number of important conditions being met, in the case of interest paid startingfrom 1 July, 2005 to individuals which qualify as beneficial owners of the interest payment and are residentfor tax purposes in another Member State, Italian qualified paying agents report to the Italian Tax Authoritiesdetails of the relevant payments and personal information on the individual beneficial owner. Suchinformation is transmitted by the Italian Tax Authorities to the competent foreign tax authorities of the Stateof residence of the beneficial owner.

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SUBSCRIPTION AND SALE

Deutsche Bank AG (the “Lead Manager”) has, pursuant to a subscription agreement dated on or prior to theIssue Date between the Lead Manager, the Arranger, the Representative of the Noteholders, the Issuer andthe Originator in respect of the Rated Notes (the “Rated Notes Subscription Agreement”), agreed tosubscribe and pay the Issuer for the Rated Notes at the issue price of 100 per cent. of their principal amount.

Pursuant to a subscription agreement (the “Class Z Notes Subscription Agreement” and, together with theRated Notes Subscription Agreement, the “Subscription Agreements”) dated on or prior to the Issue Datebetween the Originator, the Representative of the Noteholders and the Issuer, the Originator (the “Class ZNotes Subscriber”) has agreed to subscribe and pay the Issuer for the Class Z Notes at the issue price of 100per cent. of their principal amount.

The Issuer will pay the Lead Manager an underwriting commission as set out in the Rated NotesSubscription Agreement.

The Rated Notes Subscription Agreement is subject to a number of conditions and may be terminated by theLead Manager in certain circumstances prior to payment for the Rated Notes to the Issuer. Each of the Issuerand the Originator have given certain representations and warranties to the Lead Manager and have agreed toindemnify the Lead Manager against certain liabilities in connection with the issue of the Rated Notes.

In addition, pursuant to the Subscription Agreements, the Lead Manager and the Class Z Notes Subscriber intheir capacity as holders of the Rated Notes and Class Z Notes respectively, will appoint Deutsche TrusteeCompany Limited as representative of the holders of each Class of Notes. Under the terms of theSubscription Agreements, the Representative of the Noteholders shall be appointed for a period lasting fromthe Issue Date to the date on which the last of the holders of any of the Notes has been paid in full and allamounts due to it from the Issuer by reason of its holding the Notes are duly paid or the Notes have beencancelled in accordance with the Conditions.

Set out below is a summary of the principal restrictions on the offer and sale of the Rated Notes and thedistribution of documents relating to the Rated Notes. Similar restrictions apply to the offer and sale of theClass Z Notes and the distribution of documents relating to the Class Z Notes.

EEA STANDARD SELLING RESTRICTION

In relation to each Member State of the European Economic Area which has implemented the ProspectusDirective (each, a “Relevant Member State”), the Lead Manager has represented and agreed that with effectfrom and including the date on which the Prospectus Directive is implemented in that Relevant MemberState (the “Relevant Implementation Date”) it has not made and will not make an offer of Rated Notes tothe public in that Relevant Member State prior to the publication of a prospectus in relation to the RatedNotes which has been approved by the competent authority in that Relevant Member State or, whereappropriate, approved in another Relevant Member State and notified to the competent authority in thatRelevant Member State, all in accordance with the Prospectus Directive, except that it may, with effect fromand including the Relevant Implementation Date, make an offer of Rated Notes to the public in that RelevantMember State at any time:

(a) to legal entities which are authorised or regulated to operate in the financial markets or, if not soauthorised or regulated, whose corporate purpose is solely to invest in securities;

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the lastfinancial year; (2) a total balance sheet of more than Euro 43,000,000 and (3) an annual net turnoverof more than Euro 50,000,000, as shown in its last annual or consolidated accounts; or

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(c) in any other circumstances which do not require the publication by the Issuer of a prospectuspursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer of Notes to the public” in relation to any RatedNotes in any Relevant Member State means the communication in any form and by any means of sufficientinformation on the terms of the offer and the Rated Notes to be offered so as to enable an investor to decideto purchase or subscribe the Rated Notes, as the same may be varied in that Member State by any measureimplementing the Prospectus Directive in that Member State and the expression “Prospectus Directive”means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant MemberState.

United States of America

The Rated Notes have not been and will not be registered under the United States Securities Act of 1933, asamended (the “Securities Act”) or any U.S. State securities laws and may not be offered or sold within theUnited States or to, or for the account or benefit of, U.S. persons except in accordance with Regulation Sunder the Securities Act or pursuant to an exemption from the registration requirements of the Securities Act(as defined by Regulation S under the Securities Act).

The Rated Notes are in bearer form, are subject to U.S. tax law requirements and may not be offered, sold ordelivered within the United States or its possessions or to a United States person, except in certaintransactions permitted by U.S. tax regulations. Terms used in this paragraph have the meanings given tothem by the U.S. Internal Revenue Code and regulations thereunder. Any United States person who holds theRated Notes will be subject to limitations under the United States income tax laws, including the limitationsprovided in sections 165(j) and 1287(a) of the Internal Revenue Code.

The Lead Manager, under the Rated Notes Subscription Agreement, has represented and agreed that it hasnot offered and sold the Rated Notes and will not offer, sell or deliver Rated Notes, (i) as part of itsdistribution at any time or (ii) otherwise until 40 days after the later of the date of commencement of theoffering of the Rated Notes and the Issue Date (the “Distribution Compliance Period”), within the UnitedStates or to, or for the account or benefit of, a U.S. person except in accordance with Rule 903 of RegulationS under the Securities Act and, accordingly, that nor the Lead Manager and its affiliates, nor any personacting on its or their behalf has engaged or will engage in any directed selling efforts with respect to theRated Notes and it and its affiliates and any person acting on its behalf has complied with and will complywith the offering restriction requirements of Regulation S under the Securities Act to the extent applicable.The Lead Manager under the Rated Notes Subscription Agreement has also agreed that, at or prior toconfirmation of sales of any Rated Notes, it will have sent to each distributor, dealer or person receiving aselling concession, fee or other remuneration that purchases Rated Notes from it during the DistributionCompliance Period a confirmation or notice setting forth the restrictions on offers and sales of the RatedNotes within the United States or to, or for the account or benefit, of U.S. persons substantially to thefollowing effect:

“The Notes covered hereby have not been registered under the U.S. Securities Act of 1933, as amended (the“Securities Act”), and may not be offered or sold within the United States or to, or for the account or benefitof, U.S. persons (i) as part of their distribution at any time and (ii) otherwise until 40 days after the later ofthe commencement of the offering or the closing date, in either case only in accordance with Regulation Sunder the Securities Act. Terms used above have the meanings given to them by Regulation S under theSecurities Act.”

In addition, until the end of the Distribution Compliance Period, an offer or sale of the Rated Notes withinthe United States by a dealer (whether or not participating in this offering) may violate the registrationrequirements of the Securities Act.

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United Kingdom

The Lead Manager has represented to and agreed, inter alia, with the Issuer that:

(a) it has complied and will comply with all applicable provision of the Financial Services and MarketsAct 2000 (the “FSMA”) with respect to anything done by it in relation to the Rated Notes in, from orotherwise involving the United Kingdom; and

(b) it has only communicated or caused to be communicated and will only communicate or cause to becommunicated any invitation or inducement to engage in investment activity (within the meaning ofsection 21 of FSMA) received by it in connection with the issue or sale of any Rated Notes incircumstances in which section 21(1) of FSMA does not apply to the Issuer.

Italy

Each of the Lead Manager and the Class Z Subscriber has acknowledged that no application has been or willbe made by any person to obtain an authorisation from CONSOB for the public offering (offerta al pubblico)of the Notes in the Republic of Italy. Accordingly, each of the Lead Manager and the Class Z Subscriberunder each Subscription Agreement has represented and agreed that it has not offered, sold or delivered, andwill not offer, sell or deliver, and has not distributed and will not distribute and has not made and will notmake available in the Republic of Italy any Notes, the relevant Prospetto Informativo or any other offeringmaterial relating to the Notes other than:

(a) to qualified investors (investitori qualificati), including individuals and small and medium sizeenterprises, as they shall be defined by CONSOB by regulation (con regolamento) on the basis of therelevant criteria set out by Directive 2003/71/EC of the European Parliament and of the Council of 4November 2003, pursuant to art. 100, paragraph 1, lett. a) of D.Lgs. no. 58 of 24 February 1998, asamended (the Financial Laws Consolidated Act); or

(b) in any other circumstances where an express exemption from compliance with the rules relating topublic offers of financial products (offerta al pubblico di prodotti finanziari) provided for by theFinancial Laws Consolidated Act and the relevant implementing regulations (including CONSOBRegulation no. 11971 of 14 May 1999, as amended) applies.

Any offer, sale or delivery of the Notes or any offering material relating to the Notes in the circumstancesdescribed in the preceding paragraphs (a) and (b) shall be made:

(i) only by banks, investment firms (imprese di investimento) or financial companies enrolledon the special register provided for in art. 107 of Legislative Decree no. 385 of 1 September1993, as amended (the Italian Banking Act), in each case to the extent duly authorised toengage in the placement and/or underwriting (sottoscrizione e/o collocamento) of financialinstruments (strumenti finanziari) in Italy in accordance with the Italian Banking Act, theFinancial Laws Consolidated Act and the relevant implementing regulations;

(ii) until CONSOB has defined by regulation (con regolamento) the category of qualifiedinvestors (investitori qualificati) as set out above, only to entities which qualify asprofessional clients (investitori professionali) and market operators (controparti qualificate)as defined in CONSOB Regulation no. 16190 of 29 October 2007; and

(iii) in accordance with all applicable Italian laws and regulations.

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France

The Lead Manager has represented and agreed that it has not (a) offered, sold or transferred and will notoffer, sell or otherwise transfer, directly or indirectly, any Notes to the public in the Republic of France; or(b) subject to the provisions set out below, distributed or caused to be distributed and will not distribute orcause to be distributed in the Republic of France this Prospectus or any other offering material relating to theNotes. Such offers, sales, distributions and other transfers have been and shall only be made in the Republicof France to “qualified investors” (investisseurs qualifiés) and/or to a “restricted circle of investors” (cerclerestreint d’investisseurs), provided that such investors are acting for their own account and/or “personsproviding portfolio management financial services” (personnes fournissant le service d’investissement degestion de portefeuille pour compte de tiers), all as defined in and in accordance with Articles L. 411-1, L.411–2 and D. 411-1 to D.411-4 of the French Monetary and Financial Code (Code monétaire et financier).

The Notes may only be issued, directly or indirectly, to the public in France in accordance with Article L.411–2 of the French Monetary and Financial Code (Code monétaire et financier). Persons in whosepossession offering material comes must inform themselves about and observe any such restrictions. TheProspectus or any offering material relating to the Notes are not and will not be subject to any approval by orregistration (visa) with the French Autorité des Marchés Financiers.

Ireland

The Lead Manager has represented and agreed that it has complied and will comply with all applicableprovisions of the Investment Intermediaries Act, 1995 of Ireland (as amended) with respect to anything doneby it in relation to the Rated Notes or operating in, otherwise involving an offer of the notes to the public inIreland including, without limitation section 9 and 23 thereof and any codes of conduct rules made undersection 37 thereof.

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GLOSSARY OF TERMS

These and other terms used in this Prospectus are subject to, and in some cases are summaries of, thedefinitions of such terms set out in the Transaction Documents, as they may be amended from time to time.

“Acceptance” means an acceptance to purchase an Additional Pool given by the Issuer to the Originatorpursuant to the terms set out in the Master Transfer Agreement in the form set out in Schedule 5 thereto.

“Account Banks” means the Transaction Account Bank and the Italian Account Bank.

“Additional Criteria” means the criteria on the basis of which Loan Receivables comprised in anAdditional Pool are capable of being identified as a “block” pursuant to Articles 1 and 4 of the ItalianSecuritisation Law (pluralità di crediti pecuniari individuabili in blocco) such to ensure the legal andeconomic homogeneity of the Loan Receivables comprised in the Portfolio. The Additional Criteria willconsist of:

(a) the Initial Criteria to be applied with reference to the Cut-Off Date of such Additional Pool(provided that the figure, the date and the percentages set out in items 14, 23(iii) and 25(iii) thereofmay vary based on the features of such Additional Pool); and

(b) the specific criteria integrating the Initial Criteria selected from time to time by Originator (the“Specific Criteria”) if necessary to ensure that:

(i) the Loan Receivables comprised in such Additional Pool comply with the Additional PoolRequirements; and

(ii) the Purchase Price payable by the Issuer in respect of such Additional Pool on theimmediately following Payment Date does not exceed the amounts of Principal AvailableFunds which the Issuer may apply to this end in accordance with the Priority of Payments.

The Additional Criteria shall be attached to the relevant Purchase Offer.

“Additional Paying Agent” means the entity appointed from time to time as additional paying agent by theIssuer pursuant to the Agency Agreement, being, as at the Issue Date, Deutsche Bank AG, London Branch.

“Additional Pool Requirements” means, in respect of an Additional Pool offered for sale on an Offer Date,the occurrence of the following conditions relating to the Portfolio (consisting of the Initial Pool, anyAdditional Pool purchased by the Issuer from the Originator up to such Offer Date and such Additional Pool)as calculated by the Calculation Agent as at the Cut-Off Date immediately preceding such Offer Date:

(a) the sale of such Additional Pool does not result in the product of the weighted average foreclosurefrequency (‘WAFF’) for the weighted average loss severity (‘WALS’) after such purchase,calculated in the same way as for the Initial Pool, exceeding by more than 0.50% the product of theWAFF and WALS for the Initial Pool calculated on the Issue Date;

(b) Loan Receivables secured by commercial mortgages not higher than 2.02% of the Portfolio;

(c) Second Home Loans not higher than 2.21%;

(d) Loan Receivables secured by residential mortgages with an LTV lower than 50% not lower than24.2%;

(e) Weighted Average LTV not higher than 69.2%;

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(f) Loan Receivables secured by residential mortgages with an LTV comprised between 80% and 90%not higher than 12.74%;

(g) Loan Receivables secured by residential mortgages with an LTV comprised between 90.1% and95% not higher than 6.17%;

(h) Loan Receivables secured by residential mortgages with an LTV comprised between 95.1% and100% not higher than 12.88%;

(i) Self employed Borrowers not higher than 31.07%;

(j) Minimum concentration towards Borrowers domiciled in Northern Italy 49.80%;

(k) Maximum concentration towards Borrowers domiciled in Central Italy 25.35%;

(l) Maximum concentration towards Borrowers domiciled in Southern Italy 24.85%;

(m) the principal amount outstanding of the Loan Receivables comprised in such Additional Pool due bythe largest twenty Borrowers (the Top 20 Borrowers) with reference to the principal amountsoutstanding due under the relevant Loan Receivable, does not exceed 4.49% of the principaloutstanding amount of the Loan Receivables comprised in such Additional Pool, both calculated asat the relevant Cut-Off Date;

(n) the principal amount outstanding of the Loan Receivables comprised in such Additional Pool due bythe largest ten Borrowers (the Top 10 Borrowers) with reference to the principal amountsoutstanding due under the relevant Loan Receivable, does not exceed 2.54% of the principaloutstanding amount of the Loan Receivables comprised in such Additional Pool, both calculated asat the relevant Cut-Off Date;

(o) Minimum weighted average margin of the Pool over three months Euribor on the Variable RateLoans equal to 2.27%;

(p) the principal amount of the Loan Receivables comprised in such Portfolio arising from Fixed RateLoan does not exceed 3.07% of the principal outstanding amount of the Loan Receivables comprisedin the Portfolio;

(q) All Loan Receivables will have had their first instalment paid;

(r) All Loan Receivables will have a margin over Euribor of at least 1.0%;

(s) All Loan Receivables arising from the Fixed Rate Loans comprised in such Additional Pool have anaverage minimum margin over relevant index (i.e. the swap rate at origination for the maturity of theLoan) equal to 2.30%;

(t) the minimum remaining maturity of the Loan Receivables comprised in the Pool is equal to 120months; and

(u) the percentage of the Loan Receivables having at the relevant Cut-Off Date a principal amountoutstanding in excess of Euro 380,000 (the Large Loans) comprised in each Additional Pool(calculated in respect of the Initial Principal Amount of the relevant Additional Pool) does notexceed the percentage that the Large Loans comprised in the Initial Pool bore with respect to theInitial Principal Amount of the Portfolio.

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No Modular Loan shall be included in the Additional Pools.

“Additional Pool” means any Pool other than the Initial Pool which the Issuer shall purchase from theOriginator subject to the terms and conditions set out in the Master Transfer Agreement and which shall beidentified as a pool (blocco) on the basis of the relevant Additional Criteria.

“Additional Rate” means, in respect of a Loan Receivable as of a relevant determination date, the portionexpressed as a percentage equal to the positive difference between (a) the interest accrued on such LoanReceivable; and (b) (i) the portion of the transaction costs attributable to such Loan Receivable; and (ii) theIssuer’s weighted average cost of funding.

“Adverse Claim” means any Security Interest, attachment, seizure of property or restriction existing for thebenefit of, or any right granted to, any party other than the Issuer or the Originator but in this case only in sofar as such benefit has been transferred to the Issuer.

“Affected Loan Receivable” means a Loan Receivable in respect of which one of the circumstances set outin Clause 13.1 of the Master Transfer Agreement has occurred;

“Agency Agreement” means the agency agreement to be entered into on or prior to the Issue Date betweenthe Issuer, the Representative of the Noteholders, the Italian Paying Agent and the Additional Paying Agent.

“Aggregate Interest Payment Amount” has the meaning ascribed thereto in Condition 6(c)(ii) (Right toInterest – Determination of Rates of Interest and Calculation of Interest Payment Amount).

“Arranger” means Deutsche Bank AG.

“Arrears Ratio” means, in respect of the Loan Receivables comprised in the Portfolio, the ratio between (i)the principal amounts outstanding of the Loan Receivables which are overdue over a period of 90 calendardays or more from the relevant due date, and (ii) the principal amount outstanding of the Loan Receivablescomprised in the Portfolio.

“Auditing Firm” means the auditing firm appointed from time to time to carry out auditing activities inrespect of the Issuer, being at the date hereof PKF Italia S.p.A., with registered office at Viale Veneto 10,20124 Milan;

“Available Capital Funds” means, in respect of each Class of Notes on any Calculation Date, the amount, ifany, which may be applied by the Issuer to repay the Principal Amount Outstanding of the Notes on theimmediately succeeding Payment Date.

“Available Funds” means the aggregate of the Income Available Funds and the Principal Available Funds.

“Awarded Amount Due Date” has the meaning ascribed to it in Clause 12.4(d) of the Master TransferAgreement.

“Bank of Italy Instructions” means the Istruzioni di Vigilanza per le Banche, the Manuale per la Matricedei Conti and, more generally, any other regulation from time to time issued by the Bank of Italy andapplicable to banks.

“Basic Terms Modification” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“Block Voting Instruction” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“Bookrunner” means Deutsche Bank AG.

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“Borrowers” means, in relation to each Loan Receivable, each person owing such Loan Receivable.

“Business Day” means any day (other than a Saturday or a Sunday) on which banks and foreign exchangemarkets are open for business in Milan, Dublin and London and on which the Trans-European AutomatedReal Time Gross Settlement Express Transfer (TARGET) System (or any successor thereto) is open forbusiness.

“Calculation Agent” means the entity appointed from time to time as calculating and reporting agent by theIssuer pursuant to the Cash Management Agreement, being, as at the Issue Date, Deutsche Bank AG,London Branch.

“Calculation Date” means the 4th Business Day prior to each Payment Date.

“Calculation Period” means each period of 3 (three) months commencing on (and including) a CalculationDate and ending on (but excluding) the next succeeding Calculation Date, provided that the first CalculationPeriod shall commence on (and include) the relevant Cut-Off Date and end on (but exclude) the firstCalculation Date.

“Cash Management Agreement” means the cash management agreement entered into on or prior to theIssue Date between the Issuer, the Representative of the Noteholders, the Calculation Agent, the CashManager, DB Mutui and the Account Banks.

“Cash Manager” means the entity appointed from time to time as cash manager by the Issuer pursuant tothe Cash Management Agreement, being, as at the Issue Date, Deutsche Bank AG, London Branch.

“Cash Reserve” means the cash reserve established by the Issuer pursuant to the Cash ManagementAgreement.

“Cash Reserve Account” means the Euro-denominated account in the name of the Issuer designated as suchand held with the Transaction Account Bank the operation of which is set out at Schedule 5 to the CashManagement Agreement, and any replacement thereof.

“Cash Reserve Amount” means the amount of Euro 3,853,500.

“Cash Reserve Balance” means the credit balance (if any) from time to time of the Cash Reserve Account,or, if the amounts standing to the credit of the Cash Reserve Account have been invested in EligibleInvestments, the corresponding amount to be liquidated 2 Business Days prior to the immediately followingPayment Date.

“Cash Reserve Drawdown Date” means 2 (two) Business Days prior to the relevant Payment Date.

“Cash Reserve Drawing Amount” means, as at a Calculation Date, the lower of:

(a) the Cash Reserve Balance, as at such Calculation Date; and

(b) the amount by which the aggregate of the payments and provisions required for items (a) to (t)(included) of the Pre-Enforcement Interest Priority of Payments (as calculated on such CalculationDate) on the immediately following Payment Date, exceeds the actual amount of Income AvailableFunds (with the exception of items (b), (c) and (d) thereof) available to pay or provide for such itemsof the Pre-Enforcement Interest Priority of Payments.

“Cash Reserve Release Amount” means, on any Calculation Date, the positive difference between the CashReserve Balance and the Cash Reserve Required Amount.

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“Cash Reserve Required Amount” means euro 3,853,500, being 1.5 per cent. of the aggregate PrincipalAmount Outstanding of the Notes on the Issue Date provided that, on each Payment Date falling on or afterthe first Payment Date on which the Cash Reserve is equal to or greater than 3.0 per cent. of the aggregatePrincipal Amount Outstanding of the Notes (each a “Cash Reserve Determination Date”) and if:

(a) all balances on each of the Principal Deficiency Sub-Ledgers are zero;

(b) no amount has been drawn down and is outstanding under the Liquidity Facility Agreement;

(c) the amount in the Cash Reserve is equal to or greater than the Cash Reserve Required Amount as ofthe relevant Cash Reserve Determination Date;

(d) the Arrears Ratio does not exceed 5 per cent. of the total balance of all the Loan Receivablescomprised in the Portfolio;

(e) the result produced by the fraction (B+C+D+E)/(A+B+C+D+E) is greater than or equal to twice theresult produced by that fraction as at the Issue Date; and

(f) the Unpaid Principal Deficiency is lower than 3.0 per cent.,

then the Cash Reserve Required Amount will be reduced to an amount equal, on such Cash ReserveDetermination Date, to the greater of euro 1,926,750 and 3.0 per cent. of the then Principal AmountOutstanding of the Notes.

For the purposes of this definition as at any date:






“Central Italy” means any of the following Regions in Italy: Lazio, Marche, Tuscany and Umbria.

“Certificate of Admission” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“Class” means, in respect of Notes or Noteholders, the Class A Notes, the Class B Notes, the Class C Notes,the Class D Notes, the Class E Notes or the Class Z Notes, as the case may be, or the respective holdersthereof, as the context may require.

“Class A Noteholders” means the holders of the Class A Notes from time to time or any of them.

“Class A Notes” means the Euro 211,950,000 Class A Mortgage Backed Floating Rate Notes due November2054 issued by the Issuer on the Issue Date.

“Class A Sub-Ledger Condition” means, on a Calculation Date, the circumstance that the balance of theClass A Principal Deficiency Sub-Ledger is equal to zero.

“Class A Principal Deficiency Sub-Ledger” means the ledger established and maintained by or on behalfof the Issuer in order to record the principal amount of each Loan Receivable comprised in the Portfolio

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which has been classified as a Defaulted Loan Receivable during the immediately preceding CollectionPeriod, insofar as any such amount is imputed to the Class A Notes in accordance with Condition 5.3(e)(Order of Priority – Pre-Enforcement – Principal Deficiency Sub-Ledgers).

“Class B Credit Trigger Event” means, as at any Calculation Date, the Unpaid Principal Deficiency iscalculated to exceed at the immediately succeeding Payment Date 23.75 per cent.

“Class B Noteholders” means the holders of the Class B Notes from time to time or any of them.

“Class B Notes” means the Euro 15,900,000 Class B Mortgage Backed Floating Rate Notes due November2054 issued by the Issuer on the Issue Date.

“Class B Principal Deficiency Sub-Ledger” means the ledger established and maintained by or on behalf ofthe Issuer in order to record the principal amount of each Loan Receivable comprised in the Portfolio whichhas been classified as a Defaulted Loan Receivable during the immediately preceding Collection Period,insofar as any such amount is imputed to the Class B Notes in accordance with Condition 5.3(d) (Order ofPriority – Pre-Enforcement – Principal Deficiency Sub-Ledgers).

“Class C Credit Trigger Event” means, as at any Calculation Date, the Unpaid Principal Deficiency iscalculated to exceed at the immediately succeeding Payment Date 19.5 per cent.

“Class C Noteholders” means the holders of the Class C Notes from time to time or any of them.

“Class C Notes” means the Euro 11,550,000 Class C Mortgage Backed Floating Rate Notes due November2054 issued by the Issuer on the Issue Date.

“Class C Principal Deficiency Sub-Ledger” means the ledger established and maintained by or on behalfof the Issuer in order to record the principal amount of each Loan Receivable comprised in the Portfoliowhich has been classified as a Defaulted Loan Receivable during the immediately preceding CollectionPeriod, insofar as any such amount is imputed to the Class C Notes in accordance with Condition 5.3(c)(Order of Priority – Pre-Enforcement – Principal Deficiency Sub-Ledgers).

“Class D Credit Trigger Event” means, as at any Calculation Date, the Unpaid Principal Deficiency iscalculated to exceed at the immediately succeeding Payment Date 13.50 per cent.

“Class D Noteholders” means the holders of the Class D Notes from time to time or any of them.

“Class D Notes” means the Euro 7,200,000 Class D Mortgage Backed Floating Rate Notes due November2054 issued by the Issuer on the Issue Date.

“Class D Principal Deficiency Sub-Ledger” means the ledger established and maintained by or on behalfof the Issuer in order to record the principal amount of each Loan Receivable comprised in the Portfoliowhich has been classified as a Defaulted Loan Receivable during the immediately preceding CollectionPeriod, insofar as any such amount is imputed to the Class D Notes in accordance with Condition 5.3(b)(Order of Priority – Pre-Enforcement – Principal Deficiency Sub-Ledgers).

“Class E Credit Trigger Event” means, as at any Calculation Date, the Unpaid Principal Deficiency iscalculated to exceed at the immediately succeeding Payment Date 4.0 per cent.

“Class E Noteholders” means the holders of the Class E Notes from time to time or any of them.

“Class E Notes” means the Euro 10,300,000 Class E Mortgage Backed Floating Rate Notes due November2054 issued by the Issuer on the Issue Date.

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“Class E Notes Principal Accumulated Funds” means on the First Amortisation Payment Date the creditbalance of the Class E Notes Principal Accumulation Account at such date.

“Class E Notes Principal Accumulation Account” means the Euro-denominated account in the name of theIssuer designated as such and held with the Transaction Account Bank on which on each Payment Dateduring the Initial Period a portion of the Income Available Funds will be credited in accordance with item (v)of the Pre-Enforcement Interest Priority of Payments, the operation of which is set out at Schedule 5 to theCash Management Agreement, and any replacement thereof.

“Class E Principal Deficiency Sub-Ledger” means the ledger established and maintained by or on behalf ofthe Issuer in order to record the principal amount of each Loan Receivable comprised in the Portfolio whichhas been classified as a Defaulted Loan Receivable during the immediately preceding Collection Period,insofar as any such amount is imputed to the Class E Notes in accordance with Condition 5.3(a) (Order ofPriority – Pre-Enforcement – Principal Deficiency Sub-Ledgers).

“Class Z Noteholders” means the holders of the Class Z Notes from time to time or any of them.

“Class Z Notes” means the Euro 3,950,000 Class Z Mortgage Backed Fixed Rate and Variable Return Notesdue November 2054 issued by the Issuer on the Issue Date.

“Class Z Notes Subscriber” means Deutsche Bank AG, London Branch.

“Class Z Notes Subscription Agreement” means the subscription agreement in respect of the Class Z Notesentered into on or prior to the Issue Date between the Issuer, the Representative of the Noteholders and theClass Z Notes Subscriber.

“Clearstream” means Clearstream Banking S.A. or such additional or alternative clearing system approvedby the Issuer and the Representative of the Noteholders in relation to the Notes.

“Collection Date” means the 7th (seventh) Business Day of January, April, July and October in eachcalendar year, subject to the Modified Following Business Day Convention.

“Collection Fee” means the fee payable to the Servicer for the collection activities (attività di riscossione)carried out by the Servicer pursuant to the terms of the Servicing Agreement.

“Collection Period” means each period commencing on (but excluding) a Collection Date and ending on(and including) the next succeeding Collection Date (a “Collection Period End Date”), provided that thefirst Collection Period shall commence on the Initial Cut-Off Date (excluded) and end on (and included) the7th January 2008.

“Collection Policy” means the collection policy described under Schedule 3 of the Servicing Agreement, asamended from time to time.

“Collections” means all amounts received or recovered by or on behalf of the Issuer in relation to the LoanReceivables and the Related Security comprised in the Portfolio or amounts collected by the Servicer inrelation thereto.

“Conditions” means the terms and conditions of the Notes and reference to a “Condition” shall mean areference to the relevant provision of the Conditions.

“Connected Third Party Creditor” means any third party creditor of the Issuer including, withoutlimitation, and any tax authority, listing agent, stock exchange or Rating Agency whose claims relate to theSecuritisation, other than the Noteholders and the Other Issuer Secured Creditors.

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“Corporate Servicer” means any person appointed from time to time as a corporate servicer by the Issuerpursuant to the Corporate Services Agreement being, as at the Issue Date, KPMG Fides Services S.p.A..

“Corporate Services Agreement” means the corporate services agreement entered into on or prior to theIssue Date between the Issuer, the Corporate Servicer and the Representative of the Noteholders relating tothe provision of certain corporate administration services to the Issuer.

“Credit Trigger Events” means the Class B Credit Trigger Event, the Class C Credit Trigger Event, and theClass D Credit Trigger Event and the Class E Credit Trigger Event as calculated by the Calculation Agent oneach Calculation Date and set out in the relevant Payments Report;

“Criteria” means in respect of the Initial Pool, the Initial Criteria and in respect of any Additional Pool, theAdditional Criteria attached to the relevant Purchase Offer.

“Cut-Off Date” means the date from which all rights, title and interest in a Pool accrue to the Issuerpursuant to the Master Transfer Agreement and the relevant Purchase Agreement, being:

(a) in respect of the Initial Pool, the Initial Cut-Off Date; and

(b) in respect of an Additional Pool during the Revolving Period, a Collection Period End Date.

“DB Mutui” means Deutsche Bank Mutui S.p.A., a bank organised as a joint stock company (società perazioni) under the laws of the Republic of Italy, having its registered office at Via Santa Sofia 10, 20122,Milan, Italy, fiscal code and registration with the companies’ register of Milan number 08226630153,registered with the register of banks held by Bank of Italy pursuant to Article 13 of the Italian Banking Act.

“Decree 213/98” means the Italian Legislative Decree No. 213 of June 1998, as amended and supplementedfrom time to time.

“Deed of Charge” means the deed of charge entered into on or prior to the Issue Date between the Issuerand the Representative of the Noteholders for itself and as representative of the Noteholders and the OtherIssuer Secured Creditors.

“Defaulted Loan Receivable” means a Loan Receivable classified as defaulted (credito in sofferenza) inaccordance with the Bank of Italy Instructions or under which there are twelve or more consecutive or non-consecutive delinquent monthly instalments, notwithstanding and without taking into account any loanmodification, extension or forgiveness of debt or other amendment agreed from time to time between theServicer or the Originator and the relevant Borrower.

“Directive” has the meaning ascribed thereto in Condition 8(b) (Payments).

“Documentation” means all the data, documents, records and information that the Servicer has in anyformat concerning:

(a) the Loan Receivables, the Loan and the Related Securities;

(b) the Judicial Proceedings, and

(c) the Collections.

“Early Redemption Tax” means a tax payable by the Issuer in the event of an early redemption of anyNotes (as at the date of this Prospectus equal to 20 per cent. of interest and premium (if any) accrued up tothe time of such early redemption) pursuant to Article 26(1) of the Presidential Decree No. 600 of 29

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September 1973, as amended and supplemented from time to time.

“Eligible Institution” means any depository institution, organised under the laws of any state which is amember of the European Union or of the United States, the short-term unsecured, unsubordinated andunguaranteed debt obligations of which are rated, at least “A-1” by S&P and “P-1” by Moody’s (or suchother rating as may be agreed from time to time with the relevant Rating Agency), provided that DeutscheBank S.p.A. (acting in any capacity in the context of the Securitisation) shall be considered as being anEligible Institution for so long as:

(a) the short-term, unsecured and unsubordinated debt obligations of Deutsche Bank AG, as itscontrolling parent company, are rated at least “A-1” by S&P and “P-1” by Moody’s, and its long-term, unsecured and unsubordinated debt obligations are rated at least “A1” by Moody’s;

(b) the shareholding held by Deutsche Bank AG, as its controlling parent company, does not fall below90 per cent;

(c) there are no material changes in the ownership structure of Deutsche Bank AG, as its controllingparent company, which would result in the downgrading of any of the Rated Notes; and

(d) the words “Deutsche Bank” are contained in its legal name and, in any case, only until such datewhen any of the Rating Agencies notifies the Issuer that Deutsche Bank S.p.A. no longer qualifies asan Eligible Institution.

“Eligible Investment” means:

(a) euro denominated money-market funds which have:

(i) a long-term rating of “Aaa” and a short-term rating of “MR1+” from Moody’s and permitdaily liquidation of investments or have a maturity date falling before the immediatelyfollowing Payment Date, provided that they are disposable without penalty; and

(ii) a rating of “AAAm” or a rating of “AAAm-G” from S&P, and

(b) euro-denominated senior (unsubordinated) debt securities or other debt instruments providingreimbursement in full of the principal at maturity, or repurchase transactions between the Issuer andthe Transaction Account Bank in respect of debt securities or other debt instruments provided that, inall cases:

(i) such investments are immediately repayable on demand in an amount which shall be at leastequal to the relevant invested amount, disposable without penalty or have a maturity datefalling on or before the next following Payment Date and

(ii) the debt securities or other debt instruments, or in the case of repurchase transactions, thedebt securities or other debt instruments underlying the repurchase transactions, are issuedby, or fully and unconditionally guaranteed on an unsubordinated basis by, an institutionwhose unsecured and unsubordinated debt obligations are rated:

(A) at least “P-1” by Moody’s and “A-1” by S&P in respect of short-term debt if they havea maturity of less than one month; or

(B) at least “P-1” by Moody’s and “A-1+” by S&P in respect of short-term debt, if theyhave a maturity between one and three months.

“Enforcement Priority of Payments” means the priority of payments set out in Condition 5.5 (Order of

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Priority – Enforcement Priority of Payments).

“Enforcement Proceedings” means any judicial proceeding or any proceeding aimed at recovering anyReceivables, including the enforcement of the Related Security.

“English Issuer Security” means the Security Interest created under the Deed of Charge in favour of theRepresentative of the Noteholders.

“Equity Capital Account” means the bank account held by the Issuer with the Italian Account Bank, wherethe share capital of the Issuer is credited.

“Euribor” means the rate determined in accordance with Condition 6(b) (Right to Interest – Rate ofInterest).

“Euro, €, euro or EUR” means the currency introduced at the start of the third stage of economic andmonetary union pursuant to the treaty establishing the European Community as amended from time to time.

“Euroclear” means Euroclear Bank S.A./N.V., as operator of the Euroclear System or such additional oralternative clearing system approved by the Issuer and the Representative of the Noteholders in relation tothe Notes.

“Euro-zone” means the region comprised of member states of the European Union that adopted the singlecurrency in accordance with the Treaty establishing the European Community (signed in Rome on 25 March,1957) as amended by the Treaty on European Union (signed in Maastricht on 7 February, 1992).

“Event of Default” has the meaning ascribed thereto in Condition 11 (Events of Default – Issuer InsolvencyEvents).

“Excluded Loan Receivable” means each Loan Receivable which, although arising from a Loan Agreementlisted in a Relevant List does not satisfy the relevant Criteria.

“Execution Date” means the date of execution of the Master Transfer Agreement.

“Expenses Account” means the Euro-denominated account in the name of the Issuer designated as such andheld with the Italian Account Bank the operation of which is set out at Schedule 5 to the Cash ManagementAgreement, and any replacement thereof.

“Extraordinary Resolution” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“Facility Drawings” means any drawing made by the Issuer under the Liquidity Facility Agreement, or if aStandby Drawing has been made, any withdrawn from the Liquidity Reserve Account.

“First Amortisation Payment Date” means the Payment Date falling in August 2009.

“First Put Date” means the Payment Date falling in February 2015;

“Fixed Rate Loan” means a Loan which accrue interest at a certain fixed rate pursuant to the terms set outin the relevant Loan Agreement.

“Foreclosure Proceedings” means any court proceedings brought against an Obligor of a Loan Receivablefor the amounts outstanding under the relevant Loan, together with the relevant interest and expenses.

“Further Notes” has the meaning given to it in Condition 4 (Covenants).

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“Further Portfolio” has the meaning given to it in Condition 4 (Covenants).

“Further Securitisation” has the meaning given to it in Condition 4 (Covenants).

“Further Security” has the meaning given to it in Condition 4 (Covenants).

“Further Transaction” has the meaning given to it in Condition 4 (Covenants).

“Guarantor” means each person who has granted a Related Security or which assumed the obligations of aBorrower arising from a Loan Agreement.

“Hedging Agreements” means the ISDA Master Agreement, schedule and confirmation(s), includingrelevant credit support annex, constituting the Interest Rate Cap Agreement and the Interest Rate SwapAgreement.

“Hedging Calculation Agent” means the person acting as calculation agent from time to time under each ofthe Hedging Agreement with the Issuer being, at the Issue Date, Deutsche Bank AG London Branch.

“Hedging Counterparty” means, at the Issue Date, Deutsche Bank AG London Branch or its permittedsuccessors or assigns from time to time in its capacity as (i) provider of the Interest Rate Cap Agreement and(ii) swap counterparty under the Interest Rate Swap Agreement.

“Hedging Default Termination Amount” means the amount (if any) payable by the Issuer under any of theHedging Agreements upon termination of the same where (A) the Hedging Counterparty is the “DefaultingParty” or “Affected Party” (as defined in the Hedging Agreement) or (B) the Issuer elects to terminate theswap or the interest rate cap following the occurrence of an Additional Termination Event (as defined in theHedging Agreement).

“Implementing Regulations” means any rules, regulations and guidelines issued by the Bank of Italy or anyother public authority and which implement the Italian Securitisation Law, as amended, supplemented andintegrated from time to time.

“Included Loan Receivable” means each Loan Receivable which, although arising from a Loan Agreementand satisfying the relevant Criteria, is not listed in the Relevant List.

“Income Available Funds” means, as at each Calculation Date:

(a) the aggregate of the Income Receipts received in respect of the immediately preceding CollectionPeriod,

(b) (i) any Cash Reserve Drawing Amounts (if any) which will be used on the immediately followingPayment Date, and (ii) until the Rated Notes are redeemed in accordance with the Conditions, theamount equal to the Cash Reserve Release Amount as at such Calculation Date and (iii) followingthe service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event, theCash Reserve Balance;

(c) if the Income Available Funds (with the exception of items (c) and (d) thereof), are not sufficient toenable the Issuer to make payment for items (a) to (j) (inclusive)(except for items (d) and (e) thereof)of the Pre-Enforcement Interest Priority of Payments (as calculated on such Calculation Date) on theimmediately following Payment Date, the amounts available as Facility Drawings under theLiquidity Facility Agreement which will be drawn down on the immediately following PaymentDate to cover such shortfall; and

(d) if the Income Available Funds (with the exception of item (d) thereof), are not sufficient to enable

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the Issuer to make payment for items (a) to (j) (inclusive) of the Pre-Enforcement Interest Priority ofPayments (as calculated on such Calculation Date) on the immediately following Payment Date, anamount of Principal Available Fund (if any) which will be allocated to cover such shortfall pursuantto item (a) of the Pre-Enforcement Principal Priority of Payments on the immediately followingPayment Date,

provided that the Limited Recourse Loan Available Funds shall not constitute Income Available Funds.

“Income Collections” means the aggregate of all payments of interest under the Loan Agreements and allother amounts collected by the Servicer or the Issuer (without double-counting) in connection with thePortfolio other than (i) repayments of principal (rimborso in linea capitale); and (ii) the Limited RecourseLoan Available Funds.

“Income Receipts” means the following amounts upon their being credited to the Investment Account:

(a) in respect of Loan Receivables except Defaulted Loan Receivables (but including, for the avoidanceof doubt, in respect of Regulatory Delinquent Loan Receivables), all Income Collections collectedby the Servicer;

(b) in respect of Defaulted Loan Receivables, all Collections;

(c) amounts deriving from the Securities Account in excess of the original principal amount invested inthe relevant securities, including, for the avoidance of doubt, interest and premia received in respectthereof;

(d) all amounts of net interest accrued on and credited to the Issuer Accounts (with the exception ofinterest on amounts standing to the credit of the Equity Capital Account and the Class E NotesPrincipal Accumulation Account);

(e) the amount (if any) to be received by the Issuer pursuant to the Hedging Agreements on the SwapPayment Date and Interest Rate Cap Payment Date;

(f) all other items and payments received by the Issuer qualifying as “income” (reddito) (with theexception of interest on amounts standing to the credit of the Equity Capital Account).

“Indebtedness” means any indebtedness of any person for or in respect of:

(a) moneys borrowed;

(b) any amount raised by acceptance under any acceptance credit facility;

(c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures,loan stock or any similar instrument;

(d) the amount of any liability in respect of any lease or hire purchase contract which would, inaccordance with GAAP, be treated as a finance or capital lease;

(e) receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);

(f) any amount raised under any other transaction (including any forward sale or purchase agreement)having the commercial effect of a borrowing;

(g) any derivative transaction entered into in connection with protection against or benefit from

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fluctuation in any rate or price (and, when calculating the value of any derivative transaction, onlythe marked to market value shall be taken into account);

(h) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby ordocumentary letter of credit or any other instrument issued by a bank or financial institution; and

(i) the amount of any liability in respect of any guarantee or indemnity for any of the items referred toin paragraphs (a) to (h) above.

“Individual Purchase Price” means, in respect of each Loan Receivable, an amount equal to the principalamount outstanding of such Loan Receivable as at close of business on the relevant Cut-Off Date, as set outin respect of the Initial Pool in the Schedule 3 of the Master Transfer Agreement.

“Initial Criteria” means the criteria set out in Schedule 2 (Criteri di Identificazione dei Crediti Iniziali) ofthe Master Transfer Agreement, in accordance with which the Initial Pool has been identified as a separatepool (blocco) in accordance with the Italian Securitisation Law.

“Initial Cut-Off Date” means 19 November 2007.

“Initial Period” means the period commencing on (and including) the Issue Date and ending on (butexcluding) the date falling 18 (eighteen) calendar months after the Issue Date.

“Initial Pool” means the pool of Loan Receivables transferred by the Originator to the Issuer on theExecution Date and identified as such by the Initial Criteria.

“Initial Principal Amount of the Additional Pools” means an amount equal to the sum of the principalamount of each Additional Pool as at the relevant Cut-Off Date.

“Initial Principal Amount of the Portfolio” means the principal amount of the Initial Pool as at the InitialCut-Off Date.

“Insolvency Proceedings” means bankruptcy (fallimento) or any other insolvency (procedura concorsuale)in Italy or analogous proceedings in any jurisdiction (as the case may be), including, but not limited to, anyreorganisation measure (procedura di risanamento) or winding-up proceedings (procedura di liquidazione),of any nature, court settlement with creditors in pre-bankruptcy proceedings (concordato preventivo), out-of-court settlements with creditors (accordi di ristrutturazione dei debiti), extraordinary administration(amministrazione straordinaria, including amministrazione straordinaria delle grandi imprese in crisi),compulsory administrative liquidation (liquidazione coatta amministrativa) or similar proceedings.

“Insurance Company” means any insurance company with which an Insurance Policy has been enteredinto.

“Insurance Policies” means any insurance policy entered into by the Originator, a Borrower and/ or aGuarantor in relation to a Real Estate Asset, whose relevant indemnity is destined to the repayment of a LoanReceivable under the terms set out thereunder.

“Intercreditor Agreement” means the intercreditor agreement entered into on or prior to the Issue Datebetween the Issuer, the Representative of the Noteholders and the Other Issuer Secured Creditors.

“Interest Determination Date” has the meaning ascribed thereto in Condition 6(b) (Right to Interest –Rateof Interest).

“Interest Payment Amount” has the meaning ascribed thereto in Condition 6(c)(ii) (Right to Interest –

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Determination of Rates of Interest and Calculation of Interest Payment Amount).

“Interest Period” means each period from (and including) a Payment Date to (but excluding) the nextfollowing Payment Date, provided that the first Interest Period shall begin on (and include) the Issue Dateand end on (but exclude) the next succeeding Payment Date.

“Interest Rate Cap” means the interest rate cap purchased by the Issuer from the Hedging Counterpartypursuant to the Interest Rate Cap Agreement.

“Interest Rate Cap Agreement” means the interest rate cap agreement between the Issuer and the HedgingCounterparty pursuant to which the Issuer purchased the Interest Rate Cap from the Hedging Counterpartyon or about the Issue Date.

“Interest Rate Cap Payment Date” means 2 (two) Business Days prior to each Payment Date falling priorto February 2016.

“Interest Rate Cap Strike Rate” means 7 per cent..

“Interest Rate Swap Agreement” means the interest rate swap agreement entered into on or about the IssueDate between the Issuer, the Hedging Counterparty and the Representative of the Noteholders and “InterestRate Swap” is the swap transaction entered into pursuant thereto.

“Interest Shortfall Amount” means the amount by which (A) the aggregate of the payments and provisionsrequired for items (a) to (j) (inclusive) of the Pre-Enforcement Interest Priority of Payments (as calculated onthe relevant Calculation Date) exceeds (B) the actual amount of Income Available Funds (with the exceptionof item (d) thereof) available in accordance with the Pre-Enforcement Interest Priority of Payments to pay orprovide for such items on that date.

“Investment Account” means the Euro-denominated account in the name of the Issuer designated as suchand held with the Transaction Account Bank the operation of which is set out at Schedule 5 to the CashManagement Agreement, and any replacement thereof.

“Issue Date” means on or about 21 December 2007 as the date of the issuance of the Notes.

“Issuer” means Eurohome (Italy) Mortgages S.r.l..

“Issuer Accounts” means the Issuer English Accounts and the Issuer Italian Accounts.

“Issuer Charged Property” has the meaning given to it under clause 3.1 of the Deed of Charge.

“Issuer Collection Account” means the Euro-denominated account in the name of the Issuer designated assuch and held with the Italian Account Bank the operation of which is set out at Schedule 5 to the CashManagement Agreement, and any replacement thereof.

“Issuer Enforcement Notice” has the meaning ascribed thereto in Condition 11(b) (Events of Default –Issuer Insolvency Events).

“Issuer English Accounts” means the Investment Account, the Cash Reserve Account, the Class E NotesPrincipal Accumulation Account and the Securities Account.

“Issuer Insolvency Event” has the meaning ascribed thereto in Condition 11(c) (Events of Default – IssuerInsolvency Events).

“Issuer Italian Accounts” means the Issuer Collection Account, the Payments Account, the Principal

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Reserve Account, the Equity Capital Account and the Expenses Account.

“Issuer Secured Creditors” means the Noteholders, the Representative of the Noteholders, each of thePaying Agents, the Servicer, each of the Account Banks, the Calculation Agent, the Cash Manager, theCorporate Servicer, the Hedging Counterparty, the Originator, the Lead Manager, the Arranger, the LiquidityProvider and the Class Z Notes Subscriber.

“Issuer Security” means the Italian Issuer Security and the English Issuer Security and any guarantee orSecurity Interest from time to time granted to the Representative of the Noteholders (as agent of the IssuerSecured Creditors) as security for or guaranteeing any obligations of the Issuer under the TransactionDocuments.

“Italian Account Bank” means at the Issue Date, Deutsche Bank S.p.A. with whom the Issuer CollectionAccount, the Expenses Account, the Equity Capital Account, the Principal Reserve Account and thePayments Account are held, or the Eligible Institution with whom such accounts may be held pursuant to theCash Management Agreement.

“Italian Banking Act” means Italian Legislative Decree No. 385 of 1 September 1993, as amended andsupplemented from time to time.

“Italian Bankruptcy Act” means Italian Royal Decree No. 267 of 16 March, 1942, as amended andsupplemented from time to time.

“Italian Civil Code” means Italian Royal Decree No. 262 of 16 March 1942, as amended and supplementedfrom time to time.

“Italian Code of Civil Procedure” means Royal Decree No. 1443 of 28 October 1940.

“Italian Issuer Security” means the Security Interests created under the Pledge Agreement in favour of theIssuer Secured Creditors.

“Italian Official Gazette” means the official gazette of the Republic of Italy (Gazzetta Ufficiale).

“Italian Paying Agent” means the entity appointed from time to time as Italian paying agent by the Issuerpursuant to the Agency Agreement, being, as at the Issue Date, Deutsche Bank S.p.A..

“Italian Securitisation Law” means Law No. 130 of 30 April 1999 as published in the Italian OfficialGazette No. 111 of 14 May 1999 (legge sulla cartolarizzazione dei crediti) and the relevant ImplementingRegulations, as amended and supplemented from time to time.

“Judicial Proceeding” means any possible legal proceedings (procedura giudiziale) against a Borrowerand/or a Guarantor in respect of a Loan Receivable or related Loan, including any Foreclosure Proceeding,Enforcement Proceeding and Insolvency Proceeding.

“Law 239” means Legislative Decree No. 239 of 1 April 1996, as amended and supplemented from time totime.

“Law 239 Withholding” means any withholding or deduction for or on account of “imposta sostitutiva”under Law 239.

“Law Decree 269” means Law Decree No. 269 of 30 September 2003.

“Lead Manager” means Deutsche Bank AG.

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“Liability” means any loss, damage, cost, charge, claim, demand, expense, judgment, action, proceeding orother liability whatsoever (including, without limitation, in respect of taxes, duties, levies, imposts and othercharges) and including any value added tax or similar tax charged or chargeable in respect thereof and legalfees and expenses on a full indemnity basis.

“Limited Recourse Loan Amount” has the meaning ascribed to it in Clause 13.1 of the Master TransferAgreement.

“Limited Recourse Loan Available Funds” means any amount of collections and recoveries received bythe Issuer in respect of a Loan Receivable in Breach or an Affected Loan Receivable (including any amountarising from the sale thereof) for which a Limited Recourse Loan was granted by DB Mutui to the Issuerpursuant to the terms of the Master Transfer Agreement, to be applied by the Issuer to repay in full or in partsuch Limited Recourse Loan.

“Limited Recourse Loans” means any non-interest bearing limited recourse loan (finanziamento nonproduttivo di interessi a ricorso limitato) granted by the Originator to the Issuer pursuant to Clause 11 of theTransfer Agreement in respect of an Loan Receivable in Breach or an Affected Loan Receivable, to be repaidby the Issuer on each Payment Date solely by applying the corresponding Limited Recourse Loan AvailableFunds.

“Liquidity Facility” means the Euro 8,991,500 364-day revolving loan facility provided to the Issuer by theLiquidity Provider pursuant to the Liquidity Facility Agreement;

“Liquidity Facility Agreement” means the liquidity facility agreement dated on or about the Issue Datebetween the Issuer and the Liquidity Provider;

“Liquidity Provider” means, as at the Issue Date, Deutsche Bank S.p.A., with registered office at Piazza delCalendario 3, 20126 Milan, Italy and enrolled in the register of banks held by Bank of Italy pursuant toArticle 13 of the Italian Banking Act;

“Liquidity Reserve Account” means the Euro denominated account to be opened in the name of the Issuerwith an Eligible Institution (being at the date hereof the Transaction Account Bank) when required under theterms of the Liquidity Facility Agreement for the deposit of a Standby Drawings (if any);

“Liquidity Shortfall” means the amount by which (A) the aggregate of the payments and provisionsrequired for items (a) to (j) (inclusive) (save for items (d) and (e) thereof) of the Pre-Enforcement InterestPriority of Payments (as calculated on the relevant Calculation Date) exceeds (B) the actual amount ofIncome Available Funds (with the exception of items (c) and (d) thereof) available in accordance with thePre-Enforcement Interest Priority of Payments to pay or provide for such items on that date.

“Liquidity Subordinated Amount” means all amounts payable by the Issuer pursuant to the LiquidityFacility Agreement with the exception of interest (including default interest), principal (including anyadvance made or to be made by the Liquidity Provider under the Liquidity Facility Agreement), costs,expenses, fees and indemnities.

“Loan Agreement” means each loan agreement comprised in the Portfolio from which a Loan Receivablearises;

“Loan Receivable” means, in respect of any Loan Agreement identified on the basis of the relevant Criteria,all rights and claims of DB Mutui then existing or arising at any time in the future, under or in connectionwith such Loan Agreement accruing from (but excluding) the relevant Cut-Off Date, including, withoutlimitation:

(a) all rights and claims in relation to the repayment and prepayment of principal outstanding as at close

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of business on the relevant Cut-Off Date;

(b) all rights and claims in relation to the payment of all interest (including default interest) accruingfrom (but excluding) the relevant Cut-Off Date;

(c) all rights and claims in relation to the payment of any amount or indemnity in respect of damagessuffered and costs, expenses, taxes and ancillary amounts;

(d) all rights and claims in relation to payment of any other amount or sum due for any reason(excluding those relating to operational costs and correspondence);

(e) all DB Mutui’s rights, title and interest in and to any Mortgage or Related Security relating to suchLoan Agreement

(f) all indemnity amounts and claims under and in respect of the Insurance Policy; and

(g) all privileges and priority rights (cause di prelazione) supporting the aforesaid rights and claims, aswell as any right and claim in relation to the reimbursement of legal and judicial expenses incurredafter the relevant Cut-Off Date in relation to the recovery of amounts due in respect of the LoanAgreements and, in particular, in relation to Judicial Proceedings, together with any and all otherrights, claims and actions (including any action for damages), substantial and procedural actions anddefences inherent or otherwise ancillary to the aforesaid rights and claims including, to the greaterextent permitted by any applicable law and in particular by the Italian Securitisation Law, andwithout limitation, the remedy of rescission (risoluzione) and the right to accelerate any obligation(dichiarare la decadenza dal beneficio del termine).

“Loan Receivables in Breach” has the meaning ascribed to it in Clause 13.1 of the Master TransferAgreement.

“Loan to Value” or “LTV”, means, in respect of each Loan, the ratio, expressed as a percentage, betweenthe principal amount of that Loan and the value of the Real Estate Asset securing such Loan, calculated as atthe date on which such Loan was drawn.

“Loans” means a loan arising from a Loan Agreement.

“Management Fee” means the fee payable to the Servicer for the management and monitoring activities inrelation to the Portfolio to be carried out by the Servicer pursuant to the terms of the Servicing Agreement.

“Mandate” means the irrevocable mandate (mandato con rappresentanza) granted by the Issuer to theRepresentative of the Noteholders pursuant to the Intercreditor Agreement.

“Master Definitions and Construction Agreement” means the master definitions and constructionagreement to be entered into on or prior to the Issue Date between the Issuer and the other parties to theTransaction Documents.

“Master Transfer Agreement” means the Master Transfer Agreement entered into on the Execution Datebetween the Issuer and the Originator.

“Maturity Date” means the Payment Date falling on November 2054 in accordance with Condition 7(a)(Final Redemption).

“Meeting” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“Modified Following Business Day Convention” means the business day convention under which, where a

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relevant date falls on a day which is not a Business Day, that date will be adjusted so that it falls on the firstfollowing day that is a Business Day, unless the first following Business Day falls in the next calendarmonth, in which case that date will fall on the first preceding day that is a Business Day.

“Modular Loan” means a Loan pursuant to which the relevant Borrower has the option to change theinterest rate payable from a floating rate to a fixed rate based on prevailing market rates on and from thethird anniversary of taking out such Loan and the relevant Borrower may then opt to alternate between fixedand floating rate products at three yearly intervals thereafter.

“Monte Titoli” means Monte Titoli S.p.A..

“Monte Titoli Account Holders” means any authorised financial intermediary institution entitled to holdaccounts on behalf of its customers with Monte Titoli.

“Moody’s” means Moody’s Investors Service, Inc..

“Mortgage” means any mortgage (ipoteca) created on the Real Estate Assets as real security interests (dirittireali di garanzia) to secure the payment or repayment of any amounts payable in respect of a LoanAgreement.

“Most Senior Class of Notes” means:

(a) if any Class A Notes are outstanding, the Class A Notes;

(b) if any Class B Notes are outstanding and no Class A Notes are outstanding, the Class B Notes;

(c) if any Class C Notes are outstanding and no Class A Notes and no Class B Notes are outstanding, theClass C Notes; and

(d) if any Class D Notes are outstanding and no Class A Notes, no Class B Notes and no Class C Notesare outstanding, the Class D Notes;

(e) if any Class E Notes are outstanding and no Class A Notes, no Class B Notes, no Class C Notes andno Class D Notes are outstanding, the Class E Notes;

(f) if any Class Z Notes are outstanding and no Rated Notes are outstanding, the Class Z Notes.

“Northern Italy” means any of the following Regions in Italy: Liguria, Lombardia, Piemonte, EmiliaRomagna, Friuli Venezia Giulia, Trentino Alto Adige, Valle d’Aosta and Veneto.

“Noteholders” means the Class A Noteholders, the Class B Noteholders, the Class C Noteholders, the ClassD Noteholders, the Class E Noteholders and the Class Z Noteholders.

“Notes” means the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes, the Class ENotes and the Class Z Notes.

“Obligor” means any Borrower and/or Guarantor.

“Offer Date” means each date occurring two Business Days after the Servicer Report Date, being each ofthe relevant dates on which the Originator may propose to the Issuer to purchase an Additional Pool.

“Origination Policies” means the policies in accordance to which each Loan has been originated andgranted.

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“Originator” means DB Mutui.

“Originator Collection Account” means the Euro-denominated account in the name of the Originator heldwith the Italian Account Bank.

“Other Issuer Secured Creditors” means the Issuer Secured Creditors with the exception of theNoteholders.

“Out-of-Court Settlement” means any settlement or debt rescheduling of any Loan contractually agreedwith the relevant Obligor.

“Outstanding Senior Class” has the meaning ascribed thereto in Condition 13(p)(ii) (Meetings ofNoteholders).

“Paying Agents” means the Italian Paying Agent, the Additional Paying Agent and any other paying agentappointed by the Issuer from time to time under the Agency Agreement and “Paying Agent” means each ofthem.

“Payment Conditions” means, in respect of an Additional Pool, the perfection of (A) (i) the publication inthe Italian Official Gazette, and (ii) the deposit or registration (iscrizione) with the competent Companies’Register (Registro delle Imprese) of a notice of the assignment of the relevant Pool in accordance with theItalian Securitisation Law, and (B) the occurrence of the other conditions to payment of the Purchase Pricedue in respect of such Additional Pool set out in Clause 10.4 of the Master Transfer Agreement.

“Payment Date” means (i) prior to the service of an Issuer Enforcement Notice or the occurrence of anIssuer Insolvency Event, the 2nd (second) Business Day of February, May, August and November in eachyear; (ii) following the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent the dates provided for under Condition 5.5 (Order of Priority – Enforcement Priority of Payments),and (iii) and in the case of the first Payment Date, means February 2008.

“Payments Account” means the Euro-denominated account in the name of the Issuer designated as such andheld with the Italian Account Bank the operation of which is set out at Schedule 5 to the Cash ManagementAgreement, and any replacement thereof.

“Payments Report” means the report prepared and delivered by the Calculation Agent in the form ofSchedule 2 (Form of Payments Report) to the Cash Management Agreement on or prior to each CalculationDate, setting out the allocation of the Available Funds on each Payment Date immediately succeeding therelevant Calculation Date in accordance with the applicable Priority of Payments.

“Period of Effectiveness” means the period starting on the Execution Date and ending on the ServicerTermination Date.

“Pledge Agreement” means the pledge agreement entered into on or prior the Issue Date between the Issuerand the Representative of the Noteholders.

“Pool” means each of the Initial Pool and the Additional Pools.

“Portfolio” means the Initial Pool and any Additional Pool.

“Potential Capital Funds” has the meaning ascribed thereto in Condition 7(b)(ii) (Redemption, Purchaseand Cancellation – Mandatory pro rata redemption in whole or in part).

“Potential Termination Event” means any event which with the giving of notice, lapse of time, making of

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any determination or any combination of those things, would constitute a Termination Event.

“Pre-Enforcement Interest Priority of Payments” means the priority of payments set out in Condition 5.1(Order of Priority – Pre-Enforcement Interest Priority of Payments).

“Pre-Enforcement Principal Priority of Payment” means the priority of payment set out in Condition 5.2(Order of Priority – Pre-Enforcement Principal Priority of Payments);

“Pre-Enforcement Priority of Payment” means the Pre-Enforcement Principal Priority of Payment and thePre-Enforcement Interest Priority of Payment;

“Principal Amount Outstanding” has the meaning ascribed thereto in Condition 7(b)(iv) (Redemption,Purchase and Cancellation – Mandatory pro rata redemption in whole or in part);

“Principal Available Funds” means, as at each Calculation Date, the aggregate of the Principal Receiptsreceived in respect of the immediately preceding Collection Period, together with:

(a) any Income Receipts re-allocated to principal by application of the Principal Deficiency Sub-Ledgers;

(b) upon redemption of the Rated Notes in accordance with the Conditions, the Cash Reserve Balance;

(c) any Income Receipts equal to the Interest Shortfall Amount re-allocated to Principal Available Fundsin accordance with item (p) of the Pre-Enforcement Interest Priority of Payment,

provided that the Limited Recourse Loan Available Funds shall not constitute Principal Available Funds.

“Principal Collections” means the amounts collected by the Servicer or the Issuer in connection with thePortfolio as repayments of principal (rimborso in linea capitale), provided that, for avoidance of doubt, theLimited Recourse Loan Available Funds shall not constitute Principal Collections.

“Principal Deficiency Ledger Sub-Ledgers” means the Class A Principal Deficiency Sub-Ledger and/orClass B Principal Deficiency Sub-Ledger and/or the Class C Principal Deficiency Sub-Ledger and/or ClassD Principal Deficiency Sub-Ledger and/or the Class E Principal Deficiency Sub-Ledger, as the case may be,and “Principal Deficiency Sub-Ledger” means each of them.

“Principal Payment” has the meaning ascribed thereto in Condition 7(b)(iv) (Redemption, Purchase andCancellation – Mandatory pro rata redemption in whole or in part).

“Principal Receipts” means the following amounts upon their being credited to the Investment Account:

(a) all Principal Collections collected by the Servicer (other than the Limited Recourse Loan AvailableFunds);

(b) the amount of (i) any warranty or indemnity claim paid by the Originator pursuant to the MasterTransfer Agreement and the other Transaction Documents, and (ii) any indemnity claim paid by anyother Transaction Party to the Issuer pursuant to any Transaction Document;

(c) the amount of any Limited Recourse Loan granted by the Originator pursuant to the Master TransferAgreement;

(d) the proceeds of disposal of the Portfolio or any part thereof (if any);

(e) amounts deriving from the Securities Account as original principal amount invested in the relevant

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securities (other than interest and premia received in respect thereof, to be considered as IncomeReceipt); and

(f) except for Income Receipts, all other items and payments received by the Issuer and not qualifyingas “income” (reddito) in the hands of the Issuer.

“Principal Reserve Account” means the Euro-denominated account in the name of the Issuer designated assuch and held with the Italian Account Bank the operation of which is set out at Schedule 5 to the CashManagement Agreement, and any replacement thereof.

“Priority of Payments” means each of the Pre-Enforcement Priority of Payments and the EnforcementPriority of Payments, as applicable.

“Privacy Law” means Legislative Decree n. 196 of 30 June 2003.

“Pro rata Amortisation Conditions” means the conditions following the occurrence of which repayment ofprincipal on the Rated Notes will be made pari passu and pro rata according to the Principal AmountOutstanding of each Class of the Rated Notes. The Pro rata Amortisation Conditions are satisfied on anyCalculation Date if all of the following events occur:

(a) the result produced by the fraction (B+C+D+E)/(A+B+C+D+E) is greater than or equal to twice theresult produced by that fraction as at the Issue Date;

(b) all balances on each of the Principal Deficiency Sub-Ledgers are zero;

(c) the Cash Reserve Balance is at least equal to the Cash Reserve Required Amount;

(d) no amount has been drawn down and is outstanding under the Liquidity Facility Agreement;

(e) the Arrears Ratio does not exceed 5%;

(f) the total balance of all Loan Receivables comprised in the Portfolio which are 90 days or more inarrears does not exceed 5 per cent. of the total balance of all the Loan Receivables comprised in thePortfolio;

(g) the Unpaid Principal Deficiency is lower than 6%; and

(h) no Event of Default has occurred or is outstanding.







“Proceeding” means:

(a) any judicial or extrajudicial proceeding, enforcement action and insolvency proceeding against a

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Borrower and/or a Guarantor aimed at obtaining the reimbursement of the principal and/or thepayment of interest accrued and/or any expenses and/or any other costs related to the LoanReceivables;

(b) any judicial and extrajudicial composition with creditors and the entering into agreements related tothe restructuring and reorganization of debt, the delay of payments and/or the transfer of the LoanReceivables to third parties;

(c) any write-off, waiver and/or quittances relating to the whole or part of the Loan Receivables; and

(d) any act aimed at maintaining and/or collecting the Loan Receivables.

“Prospectus” means this prospectus.

“Purchase Agreement” means each purchase agreement entered into between the Originator and the Issuerby way of exchange of a Purchase Offer and a corresponding Acceptance to effect the transfer of anAdditional Pool in accordance with the terms of this Agreement.

“Purchase Offer” means an offer to purchase an Additional Pool made by the Originator to the Issuerpursuant to the terms set out in the Master Transfer Agreement in the form set out in Schedule 4 thereto.

“Purchase Price” means, in respect of each Pool, an amount equal to the principal amount outstanding ofthe Loan Receivables listed in the Relevant List relating to such Pool as of the relevant Cut-Off Date,payable by the Issuer to the Originator pursuant to the Master Transfer Agreement, it being agreed that thePurchase Price for the Initial Pool shall be euro 256,931,734.94.

“Put Date” has the meaning give to it in Condition 7(e) (Redemption of the Notes at the option of Put OptionNoteholders).

“Put Notice Period” has the meaning give to it in Condition 7(e) (Redemption of the Notes at the option ofPut Option Noteholders).

“Put Option” means the right of each Put Option Noteholder to offer the Rated Notes for redemption at theirRedemption Value on a Put Date in accordance with Condition 7(e) (Redemption of the Notes at the optionof Put Option Noteholders).

“Put Option Exercise Notice” has the meaning give to it in Condition 7(e) (Redemption of the Notes at theoption of Put Option Noteholders).

“Put Option Information Notice” has the meaning give to it in Condition 7(e) (Redemption of the Notes atthe option of Put Option Noteholders).

“Put Option Noteholders” means, collectively, the Class A Noteholders, Class B Noteholders, the Class CNoteholders and the Class D Noteholders.

“Put Option Notes” means, collectively, the Class A Notes, the Class B Notes, the Class C Notes and theClass D Notes.

“Put Option Outcome Notice” has the meaning give to it in Condition 7(e) (Redemption of the Notes at theoption of Put Option Noteholders).

“Put Option Quorum” means holders of Rated Notes representing more than 75% of the aggregatePrincipal Amount Outstanding of the Rated Notes, calculated as at the Calculation Date immediately

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preceding the date of delivery of the Put Option Information Notice.

“Put Option Sale Period” has the meaning give to it in Condition 7(e) (Redemption of the Notes at theoption of Put Option Noteholders).

“Put Option Sale Procedure” has the meaning give to it in Condition 7(e) (Redemption of the Notes at theoption of Put Option Noteholders).

“Quarterly Investors Report” means the report which the Calculation Agent is required to deliver on orprior to each Calculation Date pursuant to the Cash Management Agreement.

“Quarterly Maintenance Amount” means euro 30,000.

“Quotaholder” means Stichting.

“Quotaholder and Undertakings Agreement” means the quotaholder’s agreement entered into on or aboutthe Issue Date between the Issuer, the Quotaholder and the Representative of the Noteholders.

“Rate of Interest” has the meaning ascribed thereto in Condition 6(b) (Right to Interest –Rate of Interest).

“Rated Notes” means the Class A Notes, the Class B Notes, the Class C Notes, and the Class D Notes andthe Class E Notes.

“Rated Notes Subscription Agreement” means a subscription agreement in respect of the Rated Notesdated on or about the Issue Date between the Issuer, the Representative of the Noteholders and the LeadManager.

“Rating Agencies” means Moody’s and S&P.

“Real Estate Assets” means each real estate asset that has been mortgaged to secure the payment and/orrepayment of any Loan Receivable.

“Receiver” has the meaning given to it under clause 10 of the Deed of Charge.

“Recovery Fee” means the fee payable to the Servicer for the enforcement activities (attività di recupero) tobe carried out by the Servicer pursuant to the terms of the Servicing Agreement.

“Redemption Funds” means, on the First Put Date or subsequent Put Date following the exercise of the PutOption, the aggregate of (i) the net proceeds received by the Issuer from the sale of the Portfolio as a resultof a Put Option Sale Procedure, such amounts to be credited on the Investment Account at least one BusinessDay prior to the First Put Date or such subsequent Put Date, and (ii) the Available Funds, in each case to theextent such amounts are not subject to any Security Interest (other than Issuer Security).

“Redemption Value” means on a Put Option Date:

(a) in respect of the Class A Notes, their Principal Amount Outstanding as at the immediately precedingCalculation Date;

(b) in respect of the Class B Notes, the Class C Notes, the Class D Notes and Class E Notes, theirPrincipal Amount Outstanding less the Principal Deficiency Sub-Ledger of the relevant Class as atthe immediately preceding Calculation Date; and

(c) in respect of the Class Z Notes, an amount equal to the Available Capital Funds which may beapplied to redeem the Class Z Notes in accordance with Condition 5.5 (Order of Priority –

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Enforcement Priority of Payments) and which may not be lower than Euro 10,000.

“Reference Banks” has the meaning ascribed thereto in Condition 6(f) (Right to Interest –Reference Banksand Cash Manager).

“Regulatory Delinquent Loan Receivable” means a Loan Receivable classified by the Originator pursuantto the Bank of Italy Instructions as delinquent (ad incaglio) or under which there are 7 (seven) overduemonthly instalments, whether such instalments are consecutive or not.

“Related Security” means any guarantee or security (garanzia personale o reale) (including the Mortgagesand the Insurance Policies), granted or existing in any other way, for the benefit of DB Mutui, but excluding“fideiussioni omnibus”, in order to secure or guarantee:

(a) the reimbursement of the Loan Receivables; and

(b) the obligations arising under the Loan Agreements.

“Relevant Document” has the meaning ascribed thereto in Condition 19 (Limited Recourse).

“Relevant List” means (i) in respect of the Initial Pool, Schedule 3 of the Master Transfer Agreement, and(ii) in respect of any Additional Pool, the list of the Loan Receivables comprised in such Pool to be attachedto the relevant Purchase Offer.

“Relevant Margin” has the meaning ascribed thereto in Condition 6(b) (Right to Interest –Rate of Interest).

“Relevant Notes” has the meaning ascribed thereto in Condition 19 (Limited Recourse).

“Relevant Obligation” has the meaning ascribed thereto in Condition 19 (Limited Recourse).

“Representative of the Noteholders” means the entity appointed from time to time as representative of theNoteholders, being, as at the Issue Date, Deutsche Trustee Company Limited.

“Resolution No. 11768” means CONSOB Resolution No. 11768 of 23 December, 1998 as amended andsupplemented from time to time.

“Revolving Period” means the period commencing on (and including) the Execution Date and ending on(but excluding) the earlier of (i) the date on which a Termination Event occurs, or (ii) the date falling 18(eighteen) calendar months after the Issue Date (or such other period during which repayment of the Notesmay not occur without triggering an obligation to pay Early Redemption Tax).

“Revolving Termination Date” means the date on which the Revolving Period expires in accordance withClause 3 of the Master Transfer Agreement.

“S&P” means Standard and Poor’s Rating Services, a division of the McGraw Hill Companies.

“Screen Rate” has the meaning ascribed thereto in Condition 6(b)(A) (Right to Interest –Rate of Interest).

“Second Home Loans” means any Loan granted to a Borrower for purposes other than the purchase of hisprimary personal residence.

“Secured Obligations” means the aggregate of all moneys and other liabilities which from time to timebecome due, owing or payable by the Issuer to each of the Issuer Secured Creditors in their respectivecapacities under or in respect of the Notes and the other Transaction Documents on any account whatsoever,

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as principal or surety and whether or not directly or with another, in the manner provided therein.

“Securities Account” means the account in the name of the Issuer which is held with the TransactionAccount Bank and into which will be deposited all Eligible Investments (if any), represented by securitiesfrom time to time bought by or on behalf of the Issuer and any debt securities or debt instruments underlyingany repurchase transaction constituting an Eligible Investment.

“Securitisation” means the securitisation of the Portfolio effected by the Issuer through the issuance of theNotes.

“Securitisation Assets” has the meaning ascribed thereto in Condition 3(a) (Status, Segregation andSecurity).

“Security Documents” means the Pledge Agreement and the Deed of Charge.

“Security Interest” means any mortgage, charge, pledge, lien, encumbrance, right of set-off, specialprivilege (privilegio speciale), assignment by way of security, retention of title or any other security interestwhatsoever or any other agreement or arrangement having the effect of conferring security and including,without limitation, anything analogous to any of the foregoing under the laws of any jurisdiction.

“Senior Expenses” means the expenses paid or payable by the Issuer which, in the Order of Priority, willrank prior to principal payable in respect of the Rated Notes (including fees payable to the Representative ofthe Noteholders, to the Rating Agencies and to the other person which shall act, in any capacity, in theSecuritisation, but excluding interest accrued on the Rated Notes).

“Senior Expenses Proportion” means, in respect of any of the circumstances set out in Clause 8.1 or Clause13 of the Master Transfer Agreement (each a Payment Event), the percentage of the Senior Expenses paidor payable by the Issuer up to (and including) (i) if a Payment Event has occurred during the Initial Period,the first Payment Date after the expiry of the Initial Period, or (ii) if a Payment Event has occurred further tothe expiry of the Initial Period, the Payment Date immediately following the date on which such PaymentEvent has occurred, equal to the proportion that the relevant Excluded Loan Receivables or LoanReceivables in Breach or Affected Loan Receivables, as appropriate, bears to the then outstanding balance ofthe Portfolio as of the relevant Cut-Off Date (excluded).

“Servicer” means the person appointed from time to time as servicer by the Issuer under the terms of theServicing Agreement being, as at the Issue Date, DB Mutui.

“Servicer Report” means the report to be drafted and delivered by the Servicer to the Issuer having the formand contents described in Schedule 4 of the Servicing Agreement.

“Servicer Report Date” means the 9th Business Day following any Collection Period End Date, subject tothe Modified Following Business Day Convention.

“Servicer Termination Date” means the earlier of (i) the date on which the Notes have been repaid orcancelled in full and (ii) the date on which the cessation of the appointment of the Servicer has becomeeffective in accordance with Clause 12 of the Servicing Agreement.

“Servicer Termination Event” means any of the events listed under Schedule 10 of the ServicingAgreement as set out in section “Servicing of the Portfolio”.

“Servicing Agreement” means the servicing agreement entered into on the Execution Date between theIssuer and the Servicer as subsequently amended and restated by the Amendment and RestatementAgreement to the Servicing Agreement.

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“Servicing Fee” means the fees that shall be paid to the Servicer in accordance with Clause 13.1 (ServicingFee) and Schedule 5 of the Servicing Agreement and comprising the Management Fee, the Collection Feeand the Recovery Fee.

“Settlement Date” means, in respect of an Additional Pool, the date on which the Purchase Price due forsuch Additional Pool is payable, being (i) in the event that the Payment Conditions in respect of suchAdditional Pool have occurred on or prior to the Payment Date falling after the immediately preceding OfferDate, such Payment Date, or (ii) in the event that the Payment Conditions have not occurred as of suchPayment Date, the following date on which such Payment Conditions will be satisfied.

“Sole Director” means, on the Issue Date, Mr. Burrows Gordon Edwin Charles, born on 16 August 1938,resident in Rome, in Via Cassia n. 1170, Tax Code BRR GDN 38M16 Z114F, British citizen, in his capacityas sole director of the Issuer, and any other person to be appointed from time to time as sole director of theIssuer.

“Southern Italy” means any of the following Regions in Italy: Abruzzo, Basilicata, Calabria, Campania,Puglia, Molise, Sicily and Sardinia.

“Special Servicer” means the entity which may be appointed by the Servicer pursuant to the terms of theServicing Agreement to carry out in the interest of the Issuer the recovery activities in respect of thePortfolio.

“Specific Criteria” has meaning given to in paragraph (b) of the definition of Additional Criteria.

“Specified Event” means with respect to the rights of the Issuer under a Transaction Document, thecombination of:

(a) the Issuer’s failure to exercise or enforce any of the rights, entitlements or remedies, to exercise anyauthorities or powers, to give any direction or make any determination which may be available to theIssuer under such Transaction Document; and

(b) the expiry of 15 (fifteen) Business Days after the date on which the Representative of theNoteholders shall have given notice to the Issuer requiring the Issuer to exercise or enforce any suchrights, entitlements or remedies, to exercise any such authorities or powers, to give any suchdirection or to make any such determination.

“Specified Office” means, in respect of each Paying Agent, the office specified for such Paying Agent fromtime to time pursuant to the Agency Agreement.

“Standby Drawing” means any drawing made by the Issuer pursuant to the terms set out in the LiquidityFacility Agreement credited to the Liquidity Reserve Account.

“Stichting Muidenburg” means Stichting Muidenburg, a Dutch foundation having its registered office atAmsteldijk 166, 1079 LH, Amsterdam, The Netherlands.

“Subscription Agreements” means the Rated Notes Subscription Agreement and the Class Z NotesSubscription Agreement and “Subscription Agreement” means each of them.

“Subscription Price” means the subscription price at which the Notes shall be purchased on the Issue Date.

“Swap Payment Date” means 2 Business Days prior to each Payment Date.

“TARGET Settlement Day” means any day on which the Trans-European Automated Real Time GrossSettlement Express Transfer (TARGET) System (or any successor thereto) is open for business in Milan,

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London and Dublin.

“Tax or Regulatory Event” has the meaning ascribed thereto in Condition 7(c)(i) (Redemption, Purchaseand Cancellation – Redemption for Tax or Regulatory Event).

“Termination Event” means any of the events listed under Schedule 11 of the Master Transfer Agreementas set out in section “Purchase of the Portfolio”.

“Transaction Account Bank” means the Eligible Institution with whom the Investment Account, the CashReserve Account, the Securities Account and the Class E Notes Principal Accumulation Account are heldbeing, at the Issue Date, Deutsche Bank AG, London Branch.

“Transaction Documents” means the Master Transfer Agreement, any Purchase Agreement, the ServicingAgreement, the Hedging Agreements, the Corporate Services Agreement, the Subscription Agreements, theCash Management Agreement, the Security Documents, the Agency Agreement, the IntercreditorAgreement, the Quotaholder and Undertakings Agreement, the Master Definitions and ConstructionAgreement, the Liquidity Facility Agreement and any other agreement which the Issuer and theRepresentative of the Noteholders determine shall constitute a Transaction Document from time to time.

“Transaction Party” means any party to a Transaction Document.

“Transfer Date” means any Offer Date on which the Issuer has purchased an Additional Pool from theOriginator under the terms of the Master Transfer Agreement by sending a relevant Acceptance to therelevant Purchase Offer, it being understood that the Transfer Date in respect of the Initial Pool shall be theExecution Date.

“Unpaid Principal Deficiency” means, as at the Calculation Date immediately preceding any Payment Date,the ratio, expressed as a percentage, between (i) the cumulative amount of the outstanding principal of theDefaulted Loan Receivables (calculated as at the date on which each of such Loan Receivables wasclassified as a Defaulted Loan Receivable) and (ii) the Initial Principal Amount of the Portfolio and theInitial Principal Amount of the Additional Pools.

“Variable Rate Loan” means a Loan which accrue interest based on a 3-month Euribor rate pursuant to theterms set out in the relevant Loan Agreement.

“Variable Return” means, in respect of the Class Z Notes on any Payment Date:

(a) prior to the service of an Issuer Enforcement Notice or the occurrence of an Issuer Insolvency Event,the amount of all Available Funds (if any) after payment or provision for all items except item (dd)in the Pre-Enforcement Interest Priority of Payments; and

(b) following the service of an Issuer Enforcement Notice or the occurrence of an Issuer InsolvencyEvent, all amounts received or recovered by or on behalf of the Issuer and/or the Representative ofthe Noteholders in respect of the Portfolio and/or the Issuer Security and/or the other SecuritisationAssets after payment or provision for all items except items (u) and (v) of the Enforcement Priorityof Payments.

“Voter” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

“WAFF (Weighted Average Foreclosure Frequency)” means the factor indicating the proportion of theprincipal balance of the Loan Receivables that will default over the life of the Securitisation, to be calculatedin accordance with publication headed “Criteria for Calculating Italian Residential Mortgage-BackedSecurities” issued by S&P on 16 July 2002.

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“WALS (Weighted Average Loss Severity)” means the factor providing the loss severity experienced onthe defaulted principal amount of the Loan Receivables, to be calculated in accordance with publicationheaded “Criteria for Calculating Italian Residential Mortgage-Backed Securities” issued by S&P on 16 July2002.

“Weighted Average LTV” means, in respect of each Pool, the average (weighted in respect of the principalamount outstanding of each Loan comprised in such Pool) of the LTV of each Loan included in such Pool.

“Win-Win Loan” means a Loan having a variable maturity whereby the original maturity date of the Loanmay be extended for up to a maximum of ten years so as to maintain the instalment payments constant overthe life of the Loan should the three months Euribor increase. The maturity date of the loan may shortenfollowing a subsequent decrease in three months Euribor but may not be lower than the original maturitydate.

“Written Resolution” has the meaning ascribed thereto in Condition 13 (Meetings of Noteholders).

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GENERAL INFORMATION

1. On the Issue Date, the Issuer will have obtained all necessary consents, approvals and authorisationsin connection with the issue and performance of the Notes, including the authorisation of theQuotaholder by a quotaholders’ meeting.

2. Application has been made to the Irish Financial Services Authority, as competent authority underDirective 2003/71/EC, for the Prospectus to be approved. Application has been made to the IrishStock Exchange for the Rated Notes to be admitted to the Official List. The listing of the RatedNotes is expected to be granted on or prior to the Issue Date.

3. The Rated Notes have been accepted for clearance through Monte Titoli, Euroclear and Clearstreamwith the following ISINs and Common Codes:

ISIN COMMON CODE

Class A Notes ........................................................................... IT0004304710 033716664

Class B Notes ........................................................................... IT0004304769 033717539

Class C Notes ........................................................................... IT0004304785 033717598

Class D Notes ........................................................................... IT0004304819 033717687

Class E Notes ........................................................................... IT0004304827 033717709

4. The Class Z Notes have been accepted for clearance through Monte Titoli and the ISIN isIT0004304843.

5. Since 31 December 2006 (being the date of its latest audited accounts) and save as disclosed in thisProspectus, there has been no material adverse change in the financial position or prospects of theIssuer and no significant change in the trading or financial position of the Issuer.

6. Statutory accounts within the meaning of Article 2423 and following of the Italian Civil Code havebeen prepared for the Issuer in respect of the each financial year ending on 31 December as from thedate of its incorporation.

7. The Issuer is not involved in any governmental, legal or arbitration proceedings which may have, orhave had during the twelve months preceding the date of this Prospectus, a significant effect on theIssuer’s financial position nor, so far as the Issuer is aware, are any such proceedings pending orthreatened.

8. Save as disclosed in this Prospectus, as at the date of this Prospectus, the Issuer has no outstandingloan capital, borrowings, Indebtedness or contingent liabilities, nor has the Issuer created anymortgages or charges or given any guarantees.

9. The information set out in the sections entitled “The Portfolio”, “The Originator”, “Loan Servicingand Collection Policy” has been compiled by reference to information provided by the DB Mutui.

10. The information regarding Deutsche Bank AG, London Branch set out in the section headed “TheHedging Counterparty” has been compiled by reference to information provided by Deutsche BankAG, London Branch.

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11. The information regarding Deutsche Bank S.p.A. set out in the section headed “The LiquidityProvider” has been compiled by reference to information provided by Deutsche Bank S.p.A..

12. The estimated annual fees and expenses payable by the Issuer in connection with (i) the transactiondescribed herein amount to approximately € 80,000, and, in particular, (ii) the admission of theNotes to trading amount to approximately € 1,500.

13. Copies of the following documents will be available, in physical form, for inspection, and in the caseof the reports referred to in paragraphs (b), (c), (e), (f) and (g) below for collection, during usualoffice hours on any weekday at the principal office of the Corporate Servicer, until the MaturityDate:

(a) the by-laws (statuto) and the deed of incorporation (atto costitutivo) of the Issuer;

(b) the annual audited financial statements of the Issuer for the fiscal years ending on 31December 2006. The financial statements for the year ending on 31 December 2007 will beavailable no later than the end of April 2008. No interim financial reports will be producedby the Issuer;

(c) the auditors’ report in respect of the Issuer’s annual audited financial statements for thefiscal years ending on 31 December 2006;

(d) copies of the following documents:

(i) the Agency Agreement;

(ii) the Cash Management Agreement;

(iii) the Class Z Notes Subscription Agreement;

(iv) the Corporate Services Agreement;

(v) the Deed of Charge;

(vi) the Intercreditor Agreement;

(vii) the Interest Rate Swap Agreement;

(viii) the Interest Rate Cap Agreement;

(ix) the Master Definitions and Construction Agreement;

(x) the Pledge Agreement;

(xi) the Quotaholder and Undertakings Agreement;

(xii) the Rated Notes Subscription Agreement;

(xiii) the Servicing Agreement;

(xiv) the Master Transfer Agreement;

(xv) the Servicing Agreement Amendment Agreement; and

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(xvi) the Master Transfer Agreement Amendment Agreement;

(e) copies of each Servicer Report, the first of which will be available no later than April 18th2008;

(f) copies of each Quarterly Investors Report, the first of which will be available no later thanMay 16th 2008 (the Quarterly Investors Report shall constitute post-issuance transactioninformation regarding the Notes).

14. Any website (or the contents thereof) referred to in this Prospectus does not form part of thisProspectus as approved by the Stock Exchange.

15. Italian company law combined with the holding structure of the Issuer, covenants made by the Issuerand the Quotaholder in the Transaction Documents and the role of the Representative of theNoteholders are together intended to prevent any abuse of control of the Issuer.

16. There are no restrictions on the Lead Manager acquiring the Notes and/or providing financing to orfor third parties. Consequently, conflicts of interest may exist or may arise as a result of the LeadManager having different roles in this transaction and/or carrying out the other transactions for thirdparties.

17. Any foreign language text not in English language included within this Prospectus is forconvenience purposes only and does not form part of this Prospectus.

18. Deutsche Bank Luxembourg Société Anonyme is acting solely in its capacity as listing agent for theIssuer in connection with the Rated Notes and is not itself seeking an admission of the Rated Notesto the Official List of the Irish Stock Exchange or to trading on the Irish Stock Exchange for thepurposes of Directive 2004/39/EC.

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APPENDIX 1

FINANCIAL STATEMENTS OF THE ISSUER - AUDITOR’S REPORT

EUROHOME (ITALY) MORTGAGES SRLRegistered office in Via Eleonora Duse, 53 Rome (Italy)

Tax Code and Rome Companies' Register number 09218951003Share capital Euro 10.000,00 - fully paid-up

Registered at no 39050 in the general register held by the Ufficio Italiano dei Cambi pursuant to Art. 106 of Legislative Decree 385/1993Registered with the Special Register held with the Bank of Italy pursuant to Art. 107 of Legislative Decree 385/1993

FINANCIAL STATEMENTS20 DECEMBER 2007

COMPANY'S OFFICERS

Sole DirectorGordon Edwin Charles Burrows

ITA80503 216

BALANCE SHEET (amounts in Euro)

Assets 20 December 2007 31 December 200660 Accounts receivable 10.000 2.500

Total assets 10.000 2.500

Liabilities 20 December 2007 31 December 2006

120 Share capital 10.000 2.500

170 Income (loss) of current management 0 0

Total liabilities 10.000 2.500

PROFIT AND LOSS ACCOUNT (amounts in Euro)

Cost - Revenues 20 December 2007 31 December 2006

Operating result 0 0

Income (loss) of current management, before taxes 0 0

Income of the year 0 0

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THE ISSUER

Eurohome (Italy) Mortgages S.r.l.via Eleonora Duse, 53

00197 RomeItaly

THE ORIGINATOR

Deutsche Bank Mutui S.p.A. via Santa Sofia, 10

20122 MilanItaly

REPRESENTATIVE OF THE NOTEHOLDERS

Deutsche Trustee Company LimitedWinchester House,

1, Great Winchester StreetLondon EC2N 2DB

United Kingdom

CASH MANAGER,TRANSACTION ACCOUNT BANK,

ADDITIONAL PAYING AGENTAND CALCULATION AGENT

LIQUIDITY PROVIDER ANDITALIAN PAYING AGENT

Deutsche Bank AG, London BranchWinchester House

1, Great Winchester StreetLondon EC2N 2DB United Kingdom

Deutsche Bank S.p.A.Piazza del Calendario, 3

20126 MilanItaly

CORPORATE SERVICER HEDGING COUNTERPARTY

KPMG Fides Servizi Di Amministrazione S.p.A.via Vittor Pisani, 27

20124 Milan Italy

Deutsche Bank AG, London BranchWinchester House

1, Great Winchester StreetLondon EC2N 2DB United Kingdom

LEGAL ADVISERS

to the Arranger andthe Lead Manager

Freshfields Bruckhaus Deringervia dei Giardini, 7

20121 MilanItaly

to the Representative of the Noteholders

Allen & Overyvia Manzoni, 41

20121 MilanItaly