Third Parties Related Risks

TWINO’s operations depend on various third parties- including Issuers, Lenders, IT service providers and banks. Any disruption, failure, or non-compliance by these partners could impact service quality, increase costs, or negatively affect business performance.

Operational risk

TWINO faces and manages operational risk which summarizes the uncertainties that day-to-day business activities bring. This risk can result from breakdowns in internal procedures, people and systems. Operational risk is managed with help of well-developed internal processes and procedures ensuring the risk is managed accordingly in a timely manner. The main risk factors are dependency on third-party providers and information technology systems as well as legal risks that should be considered in particular. To optimize costs of business operations, TWINO uses information technology services provided by the third parties such as cloud computing providers, communication providers, IT development service providers and license providers. To be able to distribute the Security, for each of the Series, TWINO must coordinate the security issuance process with Nasdaq CSD SE. However, it should be noted that TWINO might face the risk of Security issuance interruption. If any IT system of the business operations were to fail, any or all stages of the security distribution process could be affected. There can be no assurance of possible disruptions (even short-term) to the functionality of IT systems used by TWINO and IT infrastructure. Any inability to maintain existing business relationships with banks, IT service providers and other third-party providers or the failure by these third-party providers to maintain the quality of their services or otherwise provide their services to the Distributor may have a material adverse effect on the Distributor’s business and reputation.

Legal Risks

• The TWINO operations are subject to regulation by Bank of Latvia and other state authorities, including, but not limited to, laws and regulations relating to provision of investment services, as well as to anti-money laundering laws and sanction regulations. Failure to comply with existing laws and regulations applicable to the TWINO’s operations, or adverse findings of Bank of Latvia inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Distributor from continuing substantial parts of its business activities, suspension or revocation of the licenses, or in criminal penalties being imposed on the officers. • The Issuer’s operations are subject to regulation by a variety of financial services and other state authorities, including, but not limited to, laws and regulations relating to issuance of Securities and personal data processing. Failure to comply with existing laws and regulations applicable to the Issuer’s operations, or to obtain and comply with all authorizations and permits required for the Issuer's operations, or adverse findings of governmental inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Issuer from continuing its business activities, or in criminal penalties being imposed on the Issuer’s officers. • The Loan Originator’s operations are subject to regulation by a variety of consumer protection, financial services and other state authorities, including, but not limited to, laws and regulations relating to the provision of payment services, consumer crediting and consumer rights protection, debt collection, and personal data processing. Failure to comply with existing laws and regulations applicable to the Loan Originator’s operations, or to obtain and comply with all authorizations and permits required for its operations, or adverse findings of governmental inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Loan Originator from continuing substantial parts of its business activities, suspension or revocation of the licenses, or in criminal penalties being imposed on the officers

Liquidity risk

The Securities are not admitted to any trading venue and thus, can be considered as illiquid instruments. The potential buyers and transferees are limited only to other investors on the TWINO website (www.twino.eu). Neither the Issuer, nor any other person guarantees the minimum liquidity of the Securities prior the initially agreed term has expired. The investor should consider that there may be difficulties in selling the Securities to other investors on the Platform, which might lead to selling at a discount to liquidate the investor’s position. Discount rate and premium shall be capped to maximum of 29.9 per cent (for discount) and 4.9 per cent (for premium) change from Nominal Value correspondingly.

Price risk

Securities shall be repaid for their Nominal Value; however, the fair value of the Security might significantly differ from the initial Nominal Value as price of the Security after the Issue Date may fluctuate, depending on what other investors are willing to pay for it. Neither the Issuer, nor any other person undertakes to maintain a certain price level of Securities, therefore a Securityholder may bear loss if they decide to sell the Security.

Tax risk

Tax rates and the payment procedure of taxes that are in force at the moment of the purchase of the Securities and are applicable to both tax residents and non-residents of Latvia may change over time. The Issuer will not compensate the investor for any increase in taxes to be paid by them, therefore, the inventor may receive smaller payments related to the Securities over time.

Third Parties Related Risks

TWINO’s operations depend on various third parties- including Issuers, Lenders, IT service providers and banks. Any disruption, failure, or non-compliance by these partners could impact service quality, increase costs, or negatively affect business performance.

Operational risk

TWINO faces and manages operational risk which summarizes the uncertainties that day-to-day business activities bring. This risk can result from breakdowns in internal procedures, people and systems. Operational risk is managed with help of well-developed internal processes and procedures ensuring the risk is managed accordingly in a timely manner. The main risk factors are dependency on third-party providers and information technology systems as well as legal risks that should be considered in particular. To optimize costs of business operations, TWINO uses information technology services provided by the third parties such as cloud computing providers, communication providers, IT development service providers and license providers. To be able to distribute the Security, for each of the Series, TWINO must coordinate the security issuance process with Nasdaq CSD SE. However, it should be noted that TWINO might face the risk of Security issuance interruption. If any IT system of the business operations were to fail, any or all stages of the security distribution process could be affected. There can be no assurance of possible disruptions (even short-term) to the functionality of IT systems used by TWINO and IT infrastructure. Any inability to maintain existing business relationships with banks, IT service providers and other third-party providers or the failure by these third-party providers to maintain the quality of their services or otherwise provide their services to the Distributor may have a material adverse effect on the Distributor’s business and reputation.

Legal Risks

• The TWINO operations are subject to regulation by Bank of Latvia and other state authorities, including, but not limited to, laws and regulations relating to provision of investment services, as well as to anti-money laundering laws and sanction regulations. Failure to comply with existing laws and regulations applicable to the TWINO’s operations, or adverse findings of Bank of Latvia inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Distributor from continuing substantial parts of its business activities, suspension or revocation of the licenses, or in criminal penalties being imposed on the officers. • The Issuer’s operations are subject to regulation by a variety of financial services and other state authorities, including, but not limited to, laws and regulations relating to issuance of Securities and personal data processing. Failure to comply with existing laws and regulations applicable to the Issuer’s operations, or to obtain and comply with all authorizations and permits required for the Issuer's operations, or adverse findings of governmental inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Issuer from continuing its business activities, or in criminal penalties being imposed on the Issuer’s officers. • The Loan Originator’s operations are subject to regulation by a variety of consumer protection, financial services and other state authorities, including, but not limited to, laws and regulations relating to the provision of payment services, consumer crediting and consumer rights protection, debt collection, and personal data processing. Failure to comply with existing laws and regulations applicable to the Loan Originator’s operations, or to obtain and comply with all authorizations and permits required for its operations, or adverse findings of governmental inspections, may result in the imposition of material fines or penalties or more severe sanctions, including preventing the Loan Originator from continuing substantial parts of its business activities, suspension or revocation of the licenses, or in criminal penalties being imposed on the officers

Risks related to macroeconomic developments

The results of the Loan Originator’s operations are dependent on the macroeconomic situation. In particular, the Loan Originator’s operations are affected by such factors as the rate of inflation, the unemployment rate and changes in consumer affluence levels. Any negative effect on the economy may decrease income of the Loan Originator’s customers and thus the ability to fulfil their obligations. Such effects may also result in insolvency of the Loan Originator’s business partners, which could affect the Loan Originator’s operations, as well as its financial standing. Lastly, in case of an economic downturn, the price of the Securities and the ability of the Loan Originator to acquire further financing may be adversely affected.