Exhibit (5)(A)
FORM OF FISCAL AGENCY AGREEMENT
REPUBLIC OF HUNGARY
FISCAL AGENCY AGREEMENT (the "Agreement") dated as of February 3,
2005, between the Republic of Hungary (the "Republic"), Citibank, N.A., London
(the "Fiscal Agent" or "Registrar"), and Deutsche Bank Luxembourg S.A. (the
"Luxembourg Paying Agent" or "Transfer Agent" and, together with the Fiscal
Agent, the "Agents").
1. The Debt Securities The Republic is issuing and selling, pursuant
to an Underwriting Agreement described in Schedule I hereto (the "Underwriting
Agreement"), the debt securities as described in Schedule I and substantially in
the form of Exhibit I attached hereto (each a "Debt Security", and collectively,
the "Debt Securities"). The Debt Securities may be issued in the form and in the
denominations specified in Schedule I hereto and integral multiples thereof.
The Debt Securities may have such letters, numbers or other marks of
identification or endorsements not referred to herein placed thereon as may be
required to comply with any law or with any rules made pursuant thereto or with
the rules of any securities exchange or governmental agency or as may,
consistently herewith, be determined by the authorized signatory of the Republic
specified in Schedule I hereto (the "Republic Authorized Signatory"), as
conclusively evidenced by his execution of the Debt Securities.
The Debt Securities will be issued in the form of one or more fully
registered global debt securities (the "Global Debt Securities") which will be
deposited with, or on behalf of, The Depository Trust Company, New York, New
York (the "Depository" or "DTC") and registered in the name of Cede & Co., the
Depository's nominee. Beneficial interests in the Global Debt Securities will be
represented through book-entry accounts of financial institutions acting on
behalf of beneficial owners as direct and indirect participants in the
Depository ("participants"). Investors may elect to hold interests in the Global
Debt Securities through either the Depository (in the United States) or
Euroclear Bank S.A./N.V., Brussels Office, as operator of the Euroclear System
("Euroclear") or Clearstream Banking, societe anonyme ("Clearstream,
Luxembourg") (in Europe), if they are participants of such systems, or
indirectly through organizations which are participants in such systems.
Euroclear and Clearstream, Luxembourg will hold interests on behalf of their
participants through customers' securities accounts in Euroclear's and
Clearstream, Luxembourg's names on the books of their respective depositaries,
which in turn will hold such interests in customers' securities accounts in such
depositaries' names on the books of the Depository. Except as set forth in
Condition 8 of the Debt Securities, the Global Debt Securities may be
transferred, in whole and not in part, only to another nominee of the Depository
or to a successor of the Depository or its nominee.
So long as the Depository or its nominee is the registered owner of
the Global Debt Securities, the Depository or such nominee, as the case may be,
will be considered the sole owner or holder or the Debt Securities represented
by the Global Debt Securities for all purposes
under this Agreement. Except as provided in Condition 8 of the Debt Securities,
owners of beneficial interests in the Global Debt Securities will not be
entitled to have Debt Securities represented by the Global Debt Securities
registered in their names, will not receive or be entitled to receive physical
delivery of Debt Securities in definitive form and will not be considered the
owners or holders thereof under this Agreement.
Interest will be payable semi-annually on each "Interest Payment
Date", as defined in the Debt Securities, to holders of record on each "Record
Date", as defined in the Debt Securities. Notwithstanding anything to the
contrary provided herein, any payment of principal or interest or additional
amounts, if any, falling due on a day which is not a Business Day will be
payable on the next succeeding Business Day and no interest shall accrue for
such intervening period, provided however that if that next succeeding Business
Day falls in the next calendar month, such payment of principal or interest will
be payable on the first preceding Business Day. Except as otherwise provided
below, interest will be paid by check mailed to each holder of record on the
relevant Record Date at the address of such person as shown on the Debt Security
register. Any record holder of Debt Securities, the aggregate principal amount
of which equals or exceeds U.S. $1,000,000, may, by written notice to the Fiscal
Agent no later than the Record Date therefor, elect to receive, and the Fiscal
Agent shall pay, the interest payment in respect of such Debt Securities by wire
transfer in same-day funds to a bank account maintained by such holder in the
United States. For the purposes of this Agreement, "Business Day" shall mean a
day on which commercial banks and foreign exchange markets are open for business
and settle payments both in London and New York.
2. Appointment as Agent. The Republic hereby appoints the Fiscal Agent
as its Paying Agent and Registrar and the Luxembourg Paying Agent as Paying
Agent and Transfer Agent in Luxembourg for the Debt Securities to perform such
duties as are hereinafter set forth. The obligations of the Agents are several
and not joint.
3. Duties as Paying Agent. The Republic hereby authorizes and directs
the Fiscal Agent, and the Fiscal Agent hereby agrees, to make payments of the
principal of and interest, and additional amounts, if any, on the Global Debt
Securities in the manner provided in the Global Debt Securities and in
accordance with the regular procedures established by the Depository for the
Global Debt Securities specified in Schedule I hereto. If the Debt Securities
are issued in definitive form, the Republic hereby authorizes and directs the
Fiscal Agent, and the Fiscal Agent hereby agrees, to make payments on behalf of
the Republic in the City and State of New York or London, and hereby authorizes
and directs the Luxembourg Paying Agent, and the Luxembourg Paying Agent agrees,
to make payments on behalf of the Republic in Luxembourg, in each case, of
principal of and interest and additional amounts, if any, on the Debt Securities
in the manner provided in the Debt Securities. The Republic will ensure that, no
later than 10:00 a.m. (New York time) on the second Business Day prior to each
date on which any payment in respect of the Debt Securities becomes payable by
the Republic under this Section, the Fiscal Agent shall receive from the bank
paying on behalf of the Republic an irrevocable payment confirmation that such
payment will be made to the Fiscal Agent. The Republic shall deposit with the
Fiscal Agent at its bank in The City of New York at 10:00 a.m. New York time on
the payment date in U.S. dollar denominated Federal funds sums sufficient for
such payments of principal of and interest and additional amounts, if any, on
the Debt Securities. However, unless and until the full amount of any such
payment has been made to the Fiscal Agent or unless and until the Fiscal Agent
is satisfied that such payment will be made, neither it nor the Luxembourg
Paying Agent shall be bound to make payments in respect of the
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Debt Securities as aforesaid. If an Agent makes any such payment on behalf of
the Republic under this Section 3, the Republic shall be liable on demand by the
Agent to pay to the Agent the amount so paid out, together with interest thereon
at such a rate as the Agent may certify as the aggregate of 1% per annum and the
cost of funding any such payment made by it (as reasonably determined by the
Agent).
The Fiscal Agent shall not be liable for any interest on any such
monies held by it under this Agreement and any money held by it need not be
segregated except as required by law.
In the event that any holder of Debt Securities shall deliver to the
Republic written notice of a default and/or an event of acceleration, as
provided in the Debt Securities, the Republic shall, by telefax, relay such
notice to the Fiscal Agent. Such notice shall be confirmed in writing by the
Republic, as promptly as possible, to the Fiscal Agent. In the event that any
holder of Debt Securities shall deliver to the Fiscal Agent notice of a default
and/or an event of acceleration, the Fiscal Agent shall relay such notice to the
Republic as promptly as possible by telefax and post pursuant to Section 10
hereof.
So long as the Debt Securities are listed on the Luxembourg Stock
Exchange, the rules of the Luxembourg Stock Exchange require so, and the Debt
Securities are issued in definitive form, the holders of the Debt Securities
will be able to receive payments thereon at the offices of the Luxembourg Paying
Agent. If the Debt Securities are issued in definitive form the Republic shall
appoint a paying agent in the City and State of New York.
The Agents shall, at the request of any holder of the Debt Securities,
issue Voting Certificates and Block Voting Instructions in a form and manner
which comply with the provisions of Schedule II (Provisions for Meetings of the
Holders of the Debt Securities) hereto (except that it shall not be required to
issue the same less than 48 hours before the time fixed for any Meeting provided
for therein). Each Agent shall keep a full record of Voting Certificates and
Block Voting Instructions issued by it and shall give to the Republic, not less
than 24 hours before the time appointed for any Meeting, full particulars of all
Voting Certificates and Block Voting Instructions issued by it in respect of
such Meeting.
The Fiscal Agent shall promptly forward to the Republic a copy of any
notice or communication addressed to the Republic by any holder of the Debt
Securities which is received by the Fiscal Agent.
The Fiscal Agent shall, upon and in accordance with instructions of
the Republic received at least 10 days before the proposed publication date,
arrange for the publication at the expense of the Republic of any notice which
is to be given to the holders of the Debt Securities and shall supply a copy
thereof to each Euroclear, Clearstream, Luxembourg and any stock exchange on
which the Debt Securities may be listed.
With respect to the Debt Securities in definitive form, upon request
by the Republic, as soon as practicable (and in any event within three months)
after each Interest Payment Date, the Fiscal Agent shall notify the Republic (on
the basis of the information available to it) of the number of any Debt
Securities in definitive form against surrender of which
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payment has been made and of the number of any Debt Securities in definitive
form which have not yet been surrendered for payment.
The Agents shall also perform any other duties of the Paying Agents
specified in the Debt Securities.
The Debt Securities shall not be amended to change or increase the
duties of the Agents without the Fiscal Agent's prior written consent, which
consent may not be unreasonably withheld.
The Fiscal Agent shall comply with all United States backup
withholding tax and information reporting requirements under the Internal
Revenue Code of 1986, as amended, and the Treasury Regulations issued thereunder
applicable to payments under, or with respect to, the Debt Securities in
definitive form (including the collection of Internal Revenue Service Forms W-8
or W-9 and the filing of Forms 1096 and 1099 with respect to such payments).
4. Duties as Registrar, Transfer Agent, and Fiscal Agent. The Fiscal
Agent, as Registrar, shall keep at its office in London a register of the names
and addresses of the holders of Debt Securities and nominal value of the Debt
Securities held by them and in which transfers of Debt Securities shall be
registered.
The Debt Securities shall be executed on behalf of the Republic
manually or by the facsimile signature of the Republic Authorized Signatory and
shall bear the facsimile of the written, printed or stamped name of the Republic
thereon imprinted. The Fiscal Agent may rely, in good faith, on Debt Securities
bearing the signature of an individual who was at any time the Republic
Authorized Signatory which signature shall bind the Republic, notwithstanding
that such individual shall have ceased to hold such office prior to the
authentication and delivery of such Debt Securities. The Republic will deliver
to the Fiscal Agent a certificate of authorization for the Republic Authorized
Signatory.
The Fiscal Agent shall authenticate and deliver on original issuance
the aggregate principal amount of the Debt Securities to or upon the order of
the Republic Authorized Signatory, registered in the name of Cede & Co. and in
the denominations as requested by the Underwriters named in the Underwriting
Agreement (the "Underwriters"). The Debt Securities shall be dated the date of
their authentication by the Fiscal Agent. Thereafter, the Fiscal Agent is
authorized from time to time to authenticate and deliver Debt Securities upon
transfers or exchanges thereof or in exchange for mutilated Debt Securities or
in lieu of destroyed, stolen or lost Debt Securities.
Transfers of the Debt Securities shall be effected in compliance with
Condition 8 of the Debt Securities.
In the event that a Global Debt Security is exchanged for certificated
Securities in definitive registered form, pursuant to Condition 8 of the Debt
Security, such Debt Securities may be exchanged or transferred for one another
only in accordance with such procedures as may be, from time to time, adopted by
the Republic so as to comply with the Securities Act and the rules and
regulations promulgated thereunder.
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So long as the Debt Securities are listed on the Luxembourg Stock
Exchange, the rules of the Luxembourg Stock Exchange require so, and the Debt
Securities are issued in definitive form, the Luxembourg Paying Agent will act
as Transfer Agent in Luxembourg and the holders of the Debt Securities will be
able to effect transfers thereof at the offices of the Luxembourg Paying Agent.
If the Debt Securities are issued in definitive form the Republic shall appoint
a transfer agent in the City and State of New York.
The Republic may from time to time deliver to the Fiscal Agent Debt
Securities in definitive form for cancellation, whereupon the Fiscal Agent shall
cancel such Debt Securities in definitive form. In addition, the Republic may
from time to time procure the delivery to the Fiscal Agent of a Global Debt
Security with instructions to cancel a specified aggregate principal amount of
Debt Securities represented by it (which instructions shall be accompanied by
confirmation from Euroclear or Clearstream, Luxembourg that Debt Securities
having such aggregate principal amount may be cancelled), whereupon the Fiscal
Agent shall procure that there is noted on the schedule to such Global Debt
Security the aggregate principal amount of Debt Securities so cancelled and the
remaining principal amount of such Global Debt Security (which shall be the
previous principal amount thereof less the aggregate principal amount of the
Debt Securities so cancelled) and shall procure the signature of such notation
on its behalf.
The Fiscal Agent shall also perform any other duties of Registrar
specified in the Debt Securities.
The Debt Securities shall not be amended to change or increase the
duties of the Fiscal Agent as Registrar or the Luxembourg Paying Agent as
Transfer Agent without such Agent's prior written consent. Such consent shall
not be unreasonably withheld.
5. Terms of Acceptance of Appointments. The Fiscal Agent hereby
accepts its appointments as Paying Agent and Registrar under this Agreement and
the Luxembourg Paying Agent accepts its appointment as Paying Agent and Transfer
Agent under this Agreement upon the further terms and conditions hereinafter set
forth:
(a) the Agents undertake to perform only such duties as are
specifically set forth in this Agreement or are incorporated into this
Agreement by reference to the Debt Securities;
(b) no provisions of this Agreement shall relieve the Agents from
liability for their own respective negligent action or willful default, or
their own respective willful misconduct except that:
(1) the duties of the Agents shall be limited as provided in
paragraph (a) of this Section; and
(2) in the absence of bad faith on the part of the Agents, the
Agents may conclusively rely upon and be protected in acting or
refraining from acting upon certificates or opinions conforming to the
requirements of this Agreement as to the truth of the statements and
the correctness of opinions expressed therein;
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(c) the Agents may rely in good faith and shall be protected in acting
on any instruction, resolution, certificate, opinion, notice, request,
order, appraisal, report, information, Debt Security or other paper or
document reasonably believed by them to be genuine and to have been signed
by the authorized party or parties;
(d) the Agents may consult with counsel or other professional advisers
selected by them (who may be counsel for the Republic) and an opinion of
such counsel or adviser shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by them
hereunder in good faith and in accordance with such opinion;
(e) the Agents, in their individual or any other capacity, may become
the owner or pledgee of Debt Securities with the same rights they would
have if they were not Paying Agent, Transfer Agent and/or Registrar and may
engage or be interested in any financial or other transaction with the
Republic, and may act on, or as depository, trustee or agent for, any
committee or body of holders of Debt Securities or other obligations of the
Republic, as freely as if they were not an Agent or such aforementioned
person;
(f) in acting under this Agreement, the Agents are acting solely as
agents of the Republic, do not assume any obligation or relationship of
agency or trust for or with any of the owners or holders of the Debt
Securities and do not assume any responsibility for the correctness of the
recitals in the Debt Securities, except that (i) all funds held by an Agent
as Paying Agent for payment of principal of or interest on the Debt
Securities shall be held in trust for the benefit of the holders of Debt
Securities entitled thereto subject to the provisions of the following
paragraph (g) and (ii) the provisions of Section 6 hereof are for the
benefit of the holders of Debt Securities;
(g) any moneys deposited with the Fiscal Agent or Luxembourg Paying
Agent, as Paying Agent, for the payment of the principal of and interest
and additional amounts, if any, on any Debt Security remaining unclaimed
for two years after such principal of or interest on or additional amounts
on such Debt Security shall have become due and payable shall be repaid,
and notice of the existence of such funds shall be given to the Republic by
the Fiscal Agent, and the holder of such Debt Security shall thereafter, as
an unsecured general creditor, look only to the Republic for any payment to
which such holder may be entitled;
(h) all Debt Securities (i) surrendered to the Fiscal Agent or the
Luxembourg Paying Agent, as Registrar or Transfer Agent, respectively, for
exchange or transfer or (ii) paid by the Fiscal Agent or Luxembourg Paying
Agent, as Paying Agent, shall be canceled by the Fiscal Agent and kept by
the Fiscal Agent in accordance with its customary procedures, and, upon
request of the Republic, evidence of such cancellation (and any subsequent
destruction) shall be promptly forwarded by the Fiscal Agent to the
Republic, and the registered owner thereof shall be stricken from the
register of Debt Securities held by the Fiscal Agent;
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(i) notwithstanding any other provision of this Agreement to the
contrary, under no circumstances shall the Agents be liable to the Republic
or any other party to this Agreement for any consequential loss (being loss
of business, goodwill or opportunity or profit) even if advised of the
possibility of such loss or damage.
(j) whenever in the administration of this Agreement, an Agent shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, such Agent (unless other
evidence be herein specifically prescribed) may rely in good faith upon a
certificate signed by a Republic Authorized Signatory and delivered to the
Agent; and
(k) the duties and obligations of the Agents shall be determined
solely by the express provisions of this Agreement, and the Agents shall be
liable only for the performance of such duties and obligations as are
specifically set forth in this Agreement, and no implied covenants or
obligations shall be read into this Agreement with respect to such Agents.
6. Resignation and Removal; Appointment of Successor. An Agent may
resign at any time by giving written notice to the Republic of its resignation,
specifying the date on which its resignation shall become effective (which shall
not be less than 60 days after the date on which notice is received, unless the
Republic shall agree in writing to a shorter period); and the Republic may
remove an Agent at any time by giving at least 60 days' notice pursuant to
Section 10 hereof to the Fiscal Agent or Luxembourg Paying Agent, as the case
may be, specifying the date on which such removal shall become effective, but in
each case only in accordance with the following provisions:
(a) any resignation or removal of an Agent shall be effective only
upon appointment by the Republic of a qualified successor paying agent and
registrar and the latter's acceptance thereof;
(b) if an Agent shall resign, be removed or become incapable of acting
as Paying Agent, Transfer Agent and/or Registrar for any cause, the
Republic shall promptly appoint a successor paying agent, transfer agent
and/or registrar;
(c) any successor paying agent and registrar appointed by the Republic
shall be a reputable financial institution legally qualified to act as such
successor and having an established place of business in London, the City
and State of New York, and/or Luxembourg, as the case may be;
(d) every successor paying agent, transfer agent and/or registrar
appointed hereunder shall execute and deliver to the Republic and to the
retiring paying agent, transfer agent and/or registrar an instrument
accepting such appointment, which shall set forth its agreement to be bound
by the terms hereof, and thereupon the resignation or removal of the
retiring paying agent, transfer agent and/or registrar shall become
effective and the successor, without further act or deed, shall become
vested with all the rights, powers, trusts and duties of the retiring
paying agent, transfer agent and/or registrar. Such retiring paying agent,
transfer agent and/or registrar shall, at the direction
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of the Republic and upon payment of its compensation and expenses then
unpaid, promptly deliver to its successor all sums held hereunder together
with all records, unissued Debt Security certificates and other documents
necessary or appropriate in connection with the performance of the duties
of the successor paying agent, transfer agent and/or registrar under this
Agreement;
(e) The Republic shall give, or cause to be given, notice of each
resignation and each removal of a paying agent, transfer agent and/or
registrar and each appointment of a successor paying agent, transfer agent
and/or registrar by publishing such notice in English in London in the
Financial Times, in New York in The Wall Street Journal (U.S. Edition), and
in Luxembourg in the Luxembourger Wort for so long as the Debt Securities
are listed on the Luxembourg Stock Exchange. If at any time publication in
any such newspaper is not practicable, notices will be valid if published
in an English language newspaper with general circulation in the respective
market regions as the Republic shall determine. Any such notice shall be
deemed to have been given on the date of such publication or, if published
more than once on different dates, on the first date on which publication
is made; and
(f) The Republic agrees with the Fiscal Agent that, if on the day
falling 30 days before the expiry of any notice given under Section 6, the
Republic has not appointed a replacement Agent, then the relevant Agent
shall be entitled, on behalf of the Republic, to appoint in its place a
reputable financial institution and the Republic shall not unreasonably
object to such appointment, and if the Republic objects to such
appointment, the Fiscal Agent may petition a court of competent
jurisdiction to make such appointment.
7. Merger, Consolidation and Sale of Fiscal Agent. In the event of any
merger or consolidation of the Fiscal Agent into another corporation or the sale
of all or substantially all the Fiscal Agent's corporate trust business, the
corporation resulting from such merger or consolidation, or the transferee in
the case of any such sale, shall be the paying agent and registrar hereunder
without further act or deed; provided, however, that such corporation shall be
otherwise qualified and eligible under this Agreement.
8. Compensation and Indemnification. The Republic agrees (1) to pay
the Fiscal Agent reasonable compensation for its services as Paying Agent and
Registrar and for services of the Luxembourg Paying Agent under this Agreement,
and to reimburse it upon its request in writing for all reasonable costs and
expenses incurred by the Agents in accordance with any provision of this
Agreement, such compensation and the further terms of such reimbursement to be
mutually agreed upon from time to time by separate written agreements, and (2)
to indemnify the Agents for, and to hold them harmless against any loss,
liability or expense incurred by them without negligence, willful misconduct or
bad faith on their respective part, arising out of or in connection with the
acceptance or acting pursuant to this Agreement or the Debt Securities,
including the reasonable costs and expenses (including counsel fees) of
defending themselves against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder or under the
Debt Securities. The obligations of the Republic under this Section 8 shall
survive payment of all of the Debt Securities or the resignation or removal of
the Agents or the termination or expiry of this
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Agreement. None of the provisions contained in this Agreement shall require any
Agent to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties.
9. Appointment of Agent for Service. The Republic hereby appoints the
Embassy of the Republic of Hungary, Office of the Trade Commissioner, 000 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, as its authorized agent (the
"Authorized Agent") upon which process may be served in any action arising out
of or based on this Agreement or the Debt Securities which may be instituted in
any State or Federal court in New York, New York by the holder of a Debt
Security of which the Fiscal Agent is acting as fiscal agent hereunder, and the
Republic expressly accepts the jurisdiction of any such court in respect of any
such action. Such appointment shall be irrevocable so long as any Debt
Securities remain outstanding unless and until a successor agent shall have been
appointed as the Republic's Authorized Agent and such successor Authorized Agent
shall have accepted such appointment. The Republic will take any and all action,
including the filing of any and all documents and instruments, that may be
necessary to continue such appointment or appointments in full force and effect
as aforesaid. Service of process upon the Authorized Agent at the address
indicated in this Section 9, or at such other address in the Borough of
Manhattan, The City of New York, as may be the address of the Authorized Agent
at the time of such service, and written notice of such service to the Republic
(mailed or delivered to the Republic at the address set forth in Section 10
hereof) shall be deemed, in every respect, effective service of process upon the
Republic. Upon receipt of such service of process, the Authorized Agent shall
advise the Republic promptly in writing by telefax of its receipt thereof, but
the failure to so advise shall have no effect on the validity or timeliness of
any such service. Notwithstanding the foregoing, any action against the Republic
arising out of or based on the Debt Securities may also be instituted by the
holder of a Debt Security in any competent court in the Republic of Hungary. The
Republic hereby waives irrevocably, to the fullest extent permitted by law, any
immunity from jurisdiction to which it might otherwise be entitled in any action
arising out of or based on this Agreement or the Debt Securities which may be
instituted as provided in this Section in any State or Federal court in New
York, New York, or in any competent court in the Republic of Hungary. Such
waiver constitutes only a limited and specific waiver for the purposes of this
Agreement and the Debt Securities and under no circumstances shall it be
interpreted as a general waiver by the Republic or a waiver with respect to
proceedings not arising out of or based on this Agreement or the Debt
Securities. Neither such appointment nor such waiver shall be interpreted to
include the waiver of any immunity with respect to: (i) actions brought against
the Republic under U.S. State or Federal securities laws; (ii) present or future
"premises of the mission" as defined in the Vienna Convention on Diplomatic
Relations signed in 1961; (iii) "Consular premises" as defined in the Vienna
Convention on Consular Relations signed in 1963; (iv) any other property or
assets used solely or mainly for official state purposes in the Republic or
elsewhere; or (v) military property or military assets or property or assets of
the Republic related thereto.
10. Notices. Any notice given pursuant to any of the provisions of
this Agreement shall be made in the English language or shall be accompanied by
a certified English translation and shall be delivered:
(a) to the Republic at:
Government Debt Management Agency Ltd.
Csalogany u. 9-11
X-0000 Xxxxxxxx
Xxxxxxx
Attention: Xx. Xxxxxx Xxxxx
Telephone: x00-0-000-0000
Telecopier: x00-0-000-0000
(b) to the Fiscal Agent or the Luxembourg Paying Agent at the address
specified in Schedule I hereto, or at such other address as may be
specified in writing to the other party.
11. Governing Law and Counterparts. This Agreement shall be construed
in accordance with the laws of the State of New York, without regard to the
conflicts of law principles of such State (other than Section 5-1401 of the
General Obligation Law of the State of New York), except with respect to its
authorization and execution by the Republic, which shall be governed by the laws
of the Republic of Hungary. This Agreement may be executed in any number of
counterparts each of which will be considered to be an original.
12. Amendments. This Agreement may be amended by written agreement of
the parties hereto, without the consent of the registered holders of the Debt
Securities, for the purpose of curing any ambiguity, or of curing, correcting or
supplementing any defective provision contained herein, or in regard to matters
or questions arising under this Agreement as such parties may deem necessary or
desirable and that shall not be inconsistent with the Debt Securities and shall
not, as solely determined by the Republic, adversely affect the interests of the
holders of Debt Securities.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date specified in Schedule I hereto.
On behalf of the Republic of Hungary
By:
---------------------------------
Name: Xxxxxx Xxxxxxx
Title: Chief Executive Officer of the
Government Debt Management Agency
Ltd. of the Republic of Hungary as
attorney for the Republic of
Hungary represented by its Minister
of Finance
Citibank, N.A., London
By:
---------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
Deutsche Bank Luxembourg S.A.
By:
---------------------------------
Name:
Title:
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SCHEDULE I
Date of Agreement: February 3, 2005
Name of Fiscal Agent: Citibank, N.A.
Address for Notices: 0 Xxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attn: Bond Agency
Fax: (x00) 00 0000 0000
Tel: (x00) 00 0000 0000
Name of Luxembourg Paying
Agent: Deutsche Bank Luxembourg S.A.
Address for Notices: 0 Xxxxxxxxx Xxxxxx Xxxxxxxx
0000 Xxxxxxxxxx
Attn: Coupon Paying Department
Fax: (+352) 473 136
Tel: (+352) 421 221
Republic Authorized Signatory: Xx. Xxxxxx Xxxxxxx
Description of Debt
Securities:
Aggregate principal amount: U.S.$ 1,500,000,000
Form of Debt Securities: Fully registered global bonds
Depository: Depository Trust Company, New York, New York
Denominations: U.S. $1,000 and integral multiples thereof
Interest rate: 4.75%
Currency of payment of
interest: U.S. Dollars
Maturity: February 3, 2015
Description of Underwriting
Agreement:
Date of Underwriting
Agreement: January 27, 2005
Names of parties: The Republic and the several Underwriters
named in Schedule I thereto
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SCHEDULE II
PROVISIONS FOR MEETINGS OF THE HOLDERS OF THE DEBT SECURITIES
1. Definitions
In this Agreement and the Conditions of the Debt Securities, the following
expressions have the following meanings:
"Block Voting Instruction" means, in relation to any Meeting, a document in
the English language issued by an Agent:
(a) certifying that certain specified Debt Securities (the "deposited Debt
Securities") have been deposited with such Agent (or to its order at a
bank or other depositary) or blocked in an account with a clearing
system and will not be released until the earlier of:
(i) the conclusion of the Meeting; and
(ii) the surrender to such Agent, not less than 48 hours before the
time fixed for the Meeting (or, if the Meeting has been
adjourned, the time fixed for its resumption), of the receipt for
the deposited or blocked Debt Securities and notification thereof
by such Agent to the Republic;
(b) certifying that the depositor of each deposited Debt Security or a
duly authorized person on its behalf has instructed the relevant Agent
that the votes attributable to such deposited Debt Security are to be
cast in a particular way on each resolution to be put to the Meeting
and that, during the period of 48 hours before the time fixed for the
Meeting, such instructions may not be amended or revoked;
(c) listing the total number and (if in definitive form) the certificate
numbers of the deposited Debt Securities, distinguishing for each
resolution between those in respect of which instructions have been
given to vote for, or against, the resolution; and
(d) authorizing a named individual or individuals to vote in respect of
the deposited Debt Securities in accordance with such instructions;
"Chairman" means, in relation to any Meeting, the individual who takes the
chair in accordance with paragraph 7 (Chairman);
"Conditions" mean the terms and conditions of the Debt Securities,
substantially in the form of Exhibit I and as modified from time to time in
accordance with their terms, and any reference to a numbered "Condition" is
to the correspondingly numbered provision thereof;
"Extraordinary Resolution" means:
(a) in relation to any Reserved Matter:
13
(i) a resolution passed at a Meeting duly convened and held in
accordance with this Schedule by a majority consisting of not
less than 75% of the aggregate principal amount of all
outstanding Debt Securities; or
(ii) a resolution in writing signed by or on behalf of holders of not
less than 75% of the aggregate principal amount of all
outstanding Debt Securities; and
(b) in relation to any other matter:
(i) a resolution passed at a Meeting duly convened and held in
accordance with this Schedule by a majority consisting of not
less than 66.67% of the aggregate principal amount of the
outstanding Debt Securities which are represented at that
Meeting; or
(ii) a resolution in writing signed by or on behalf of holders of not
less than 66.67% of the aggregate principal amount of all
outstanding Debt Securities;
"Meeting" means a meeting of holders of the Debt Securities (whether
originally convened or resumed following an adjournment);
"Proxy" means, in relation to any Meeting, a person appointed to vote under
a Block Voting Instruction other than:
(a) any such person whose appointment has been revoked and in relation to
whom the Fiscal Agent has been notified in writing of such revocation
by the time which is 48 hours before the time fixed for such Meeting;
and
(b) any such person appointed to vote at a Meeting which has been
adjourned for want of a quorum and who has not been re-appointed to
vote at the Meeting when it is resumed;
"Relevant Fraction" means:
(a) for all business other than voting on an Extraordinary Resolution, one
tenth;
(b) for voting on any Extraordinary Resolution other than one relating to
a Reserved Matter, one more than half; and
(c) for voting on any Extraordinary Resolution relating to a Reserved
Matter, three quarters;
provided, however, that, in the case of a Meeting which has resumed after
adjournment for want of a quorum it means:
(a) for all business other than voting on an Extraordinary Resolution
relating to a Reserved Matter, the fraction of the aggregate principal
amount of the outstanding
14
Debt Securities represented or held by the Voters actually present at the
Meeting; and
(b) for voting on any Extraordinary Resolution relating to a Reserved
Matter, one quarter;
"Reserved Matter" means any proposal to:
(a) change any date, or the method for determining the date, fixed for
payment of principal or interest in respect of the Debt Securities, to
reduce the amount of principal or interest payable on any date in
respect of the Debt Securities or to alter the method of calculating
the amount of any payment in respect of the Debt Securities on
redemption or maturity or the date for any such payment;
(b) effect the exchange or substitution of the Debt Securities for, or the
conversion of the Debt Securities into, shares, bonds or other
obligations or securities of the Republic or any other person or body
corporate formed or to be formed;
(c) reduce or cancel the principal amount of the Debt Securities;
(d) vary the currency or place of payment in which any payment in respect
of the Debt Securities is to be made;
(e) amend the status of the Debt Securities;
(f) amend the obligation of the Republic to pay additional amounts under
Condition 2;
(g) amend the Events of Default or the Events of Acceleration set out in
Condition 4;
(h) amend the law governing the Debt Securities, the courts to the
jurisdiction to which the Republic has submitted in the Debt
Securities, the Republic's obligation to maintain an agent for service
of process in the United States or the Republic's waiver of immunity,
in respect of actions or proceedings brought by any holder of the Debt
Securities set out in Condition 6 and 7;
(i) modify the provisions contained in this Schedule concerning the quorum
required at any Meeting or any adjournment thereof or concerning the
majority required to pass an Extraordinary Resolution or the
percentage of votes required for the taking of any action;
(j) change the definition of "Extraordinary Resolution" or "outstanding"
in the conditions of the Debt Securities and/or in this Schedule.
(k) instruct any holder of the Debt Securities or committee appointed on
behalf of all holders of the Debt Securities pursuant to paragraph 17
of this Schedule to withdraw, settle or compromise any proceeding or
claim being asserted pursuant to Condition 4;
15
(l) confer upon any committee appointed pursuant to paragraph 17 of this
Schedule any powers or discretions which the holder of the Debt
Securities could themselves exercise by Extraordinary Resolution; or
(m) amend this definition;
"Voter" means, in relation to any Meeting, the bearer of a Voting
Certificate, a Proxy or the bearer of a Debt Security in definitive form
who produces such Debt Security in definitive form at the Meeting;
"Voting Certificate" means, in relation to any Meeting, a certificate in
the English language issued by an Agent and dated in which it is stated:
(a) that certain specified Debt Securities (the "deposited Debt
securities") have been deposited with such Agent (or to its order at a
bank or other depositary) or blocked in an account with a clearing
system and will not be released until the earlier of:
(i) the conclusion of the Meeting; and
(ii) the surrender of such certificate to such Agent; and
(b) that the bearer of such certificate is entitled to attend and vote at
the Meeting in respect of the deposited Debt Securities;
"24 hours" means a period of 24 hours including all or part of a day upon
which banks are open for business in both of the places where the relevant
Meeting is to be held and in each of the places where the Agents have their
addresses, as specified in Schedule I, (disregarding for this purpose the
day upon which such Meeting is to be held) and such period shall be
extended by one period or, to the extent necessary, more periods of 24
hours until there is included as aforesaid all or part of a day upon which
banks are open for business as aforesaid; and
"48 hours" means 2 consecutive periods of 24 hours.
2. Issue Of Voting Certificates And Block Voting Instructions
The holder of a Debt Security may obtain a Voting Certificate from any
Agent or require any Agent to issue a Block Voting Instruction by
depositing such Debt Security with such Agent or arranging for such Debt
Security to be (to its satisfaction) held to its order or under its control
or blocked in an account with a clearing system not later than 48 hours
before the time fixed for the relevant Meeting. A Voting Certificate or
Block Voting Instruction shall be valid until the release of the deposited
Debt Securities to which it relates. So long as a Voting Certificate or
Block Voting Instruction is valid, the bearer thereof (in the case of a
Voting Certificate) or any Proxy named therein (in the case of a Block
Voting Instruction) shall be deemed to be the holder of the Debt Securities
to which it relates for all purposes in connection with the Meeting. A
Voting Certificate and
16
a Block Voting Instruction cannot be outstanding simultaneously in respect
of the same Debt Security.
3. References To Deposit/Release Of Debt Securities
Where Debt Securities are represented by the Global Debt Securities or are
held in definitive form within a clearing system, references to the
deposit, or release, of Debt Securities shall be construed in accordance
with the usual practices (including blocking the relevant account) of such
clearing system.
4. Validity Of Block Voting Instructions
A Block Voting Instruction shall be valid only if it is deposited at the
address of the Fiscal Agent, as specified in Schedule I, or at some other
place approved by the Fiscal Agent, at least 24 hours before the time fixed
for the relevant Meeting or the Chairman decides otherwise before the
Meeting proceeds to business. If the Fiscal Agent requires, a notarised
copy of each Block Voting Instruction and satisfactory proof of the
identity of each Proxy named therein shall be produced at the Meeting, but
the Fiscal Agent shall not be obliged to investigate the validity of any
Block Voting Instruction or the authority of any Proxy.
5. Convening Of Meeting
The Republic may convene a Meeting at any time, and shall be obliged to do
so upon the request in writing of holders of the Debt Securities holding
not less than one tenth of the aggregate principal amount of the
outstanding Debt Securities delivered at the address of the Fiscal Agent,
as specified in Schedule I.
6. Notice
At least 21 days' notice (exclusive of the day on which the notice is given
and of the day on which the relevant Meeting is to be held) specifying the
date, time and place of the Meeting shall be given to the holders of the
Debt Securities and the Agents (with a copy to the Republic). The notice
shall set out the full text of any resolutions to be proposed and shall
state that the Debt Securities may be deposited with, or to the order of,
any Agent for the purpose of obtaining Voting Certificates or appointing
Proxies not later than 48 hours before the time fixed for the Meeting.
7. Chairman
An individual (who may, but need not, be a holder of the Debt Securities)
nominated in writing by the Republic may take the chair at any Meeting but,
if no such nomination is made or if the individual nominated is not present
within 15 minutes after the time fixed for the Meeting, those present shall
elect one of themselves to take the chair, failing which the Republic may
appoint a Chairman. The Chairman of an adjourned Meeting need not be the
same person as was the Chairman of the original Meeting.
17
8. Quorum
The quorum at any Meeting shall be at least two Voters representing or
holding not less than the Relevant Fraction of the aggregate principal
amount of the outstanding Debt Securities; provided, however, that, so long
as at least the Relevant Fraction of the aggregate principal amount of the
outstanding Debt Securities is represented by the Global Debt Security, a
single Proxy representing the holder thereof shall be deemed to be two
Voters for the purpose of forming a quorum.
9. Adjournment For Want Of Quorum
If within 15 minutes after the time fixed for any Meeting a quorum is not
present, then:
(a) in the case of a Meeting requested by holder of the Debt Securities,
it shall be dissolved; and
(b) in the case of any other Meeting, it shall be adjourned for such
period (which shall be not less than 14 days and not more than 42
days) and to such place as the Chairman determines; provided, however,
that:
(i) the Meeting shall be dissolved if the Republic so decides; and
(ii) no Meeting may be adjourned more than once for want of a quorum.
10. Adjourned Meeting
The Chairman may, with the consent of (and shall if directed by) any
Meeting, adjourn such Meeting from time to time and from place to place,
but no business shall be transacted at any adjourned Meeting except
business which might lawfully have been transacted at the Meeting from
which the adjournment took place.
11. Notice Following Adjournment
Paragraph 6 (Notice) shall apply to any Meeting which is to be resumed
after adjournment for want of a quorum save that:
(a) 10 days' notice (exclusive of the day on which the notice is given and
of the day on which the Meeting is to be resumed) shall be sufficient;
and
(b) the notice shall specifically set out the quorum requirements which
will apply when the Meeting resumes.
It shall not be necessary to give notice of the resumption of a Meeting
which has been adjourned for any other reason.
12. Participation
The following may attend and speak at a Meeting:
18
(a) Voters;
(b) representatives of the Republic and the Fiscal Agent;
(c) the financial advisers of the Republic;
(d) the legal counsel to the Republic and the Fiscal Agent; and
(e) any other person approved by the Meeting.
13. Show Of Hands
Except where the proviso to paragraph 8 (Quorum) applies, every question
submitted to a Meeting shall be decided in the first instance by a show of
hands. Unless a poll is validly demanded before or at the time that the
result is declared, the Chairman's declaration that on a show of hands a
resolution has been passed, passed by a particular majority, rejected or
rejected by a particular majority shall be conclusive, without proof of the
number of votes cast for, or against, the resolution.
14. Poll
A demand for a poll shall be valid if it is made by the Chairman, the
Republic or one or more Voters representing or holding not less than one
fiftieth of the aggregate principal amount of the outstanding Debt
Securities. The poll may be taken immediately or after such adjournment as
the Chairman directs, but any poll demanded on the election of the Chairman
or on any question of adjournment shall be taken at the Meeting without
adjournment. A valid demand for a poll shall not prevent the continuation
of the relevant Meeting for any other business as the Chairman directs.
15. Votes
Every Voter shall have:
(a) on a show of hands, one vote; and
(b) on a poll, one vote in respect of each U.S. dollars 1,000 in aggregate
face amount of the outstanding Debt Securities represented or held by
him.
In the case of a voting tie the Chairman shall have a casting vote.
Unless the terms of any Block Voting Instruction state otherwise, a Voter
shall not be obliged to exercise all the votes to which he is entitled or
to cast all the votes which he exercises in the same way.
16. Validity Of Votes By Proxies
Any vote by a Proxy in accordance with the relevant Block Voting
Instruction shall be valid even if such Block Voting Instruction or any
instruction pursuant to which it was given has been amended or revoked,
provided that the Fiscal Agent has not been notified
19
in writing of such amendment or revocation by the time which is 24 hours
before the time fixed for the relevant Meeting. Unless revoked, any
appointment of a Proxy under a Block Voting Instruction in relation to a
Meeting shall remain in force in relation to any resumption of such Meeting
following an adjournment; provided, however, that no such appointment of a
Proxy in relation to a Meeting originally convened which has been adjourned
for want of a quorum shall remain in force in relation to such Meeting when
it is resumed. Any person appointed to vote at such a Meeting must be
re-appointed under a Block Voting Instruction Proxy to vote at the Meeting
when it is resumed.
17. Powers
A Meeting shall have power (exercisable by Extraordinary Resolution),
without prejudice to any other powers conferred on it or any other person:
(a) to approve any Reserved Matter;
(b) to approve any proposal by the Republic for any modification,
abrogation, variation or compromise of any of the Conditions or any
arrangement in respect of the obligations of the Republic under or in
respect of the Debt Securities;
(c) to approve the substitution of any person for the Republic (or any
previous substitute) as principal obligor under the Debt Securities;
(d) to waive any breach or authorize any proposed breach by the Republic
of its obligations under or in respect of the Debt Securities or any
act or omission which might otherwise constitute an event of default
under the Debt Securities;
(e) to authorize the Fiscal Agent or any other person to execute all
documents and do all things necessary to give effect to any
Extraordinary Resolution;
(f) to give any other authorization or approval which is required to be
given by Extraordinary Resolution; and
(g) to appoint any person or persons (whether holder of the Debt
Securities or not) as a committee or committees to represent the
interests of the holder of the Debt Securities (in any discussions
with the Republic or any other creditors of the Republic in connection
with any Event of Default, Event of Acceleration, any proposed
restructuring of the Debt Securities or other indebtedness of the
Republic or otherwise) and to confer upon a committee or committees
(appointed pursuant to this paragraph or Condition 5) any powers or
discretions which the holder of the Debt Securities could themselves
exercise by Extraordinary Resolution.
18. Extraordinary Resolution Binds All Holders
An Extraordinary Resolution shall be binding upon all holders of the Debt
Securities whether or not present at such Meeting and each of the holder of
the Debt Securities shall be bound to give effect to it accordingly. Notice
of the result of every vote on an
20
Extraordinary Resolution shall be given to the holder of the Debt
Securities and the Agents (with a copy to the Republic) within 14 days of
the conclusion of the Meeting.
19. Minutes
Minutes shall be made of all resolutions and proceedings at each Meeting.
The Chairman shall sign the minutes, which shall be prima facie evidence of
the proceedings recorded therein. Unless and until the contrary is proved,
every such Meeting in respect of the proceedings of which minutes have been
summarized and signed shall be deemed to have been duly convened and held
and all resolutions passed or proceedings transacted at it to have been
duly passed and transacted.
20. Outstanding Debt Securities
For the purposes of (i) ascertaining the right to attend and vote at any
Meeting, and (ii) Conditions 4 and 5, those Debt Securities (if any) which
are for the time being held by any person (including but not limited to the
Republic) for the benefit of the Republic or by any public body owned or
controlled, directly or indirectly, by the Republic shall (unless and until
ceasing to be so held) be deemed not to remain outstanding.
21
EXHIBIT I
FORM OF NOTE
REPUBLIC OF HUNGARY
4.75% NOTES DUE 2015
This Debt Security is a Global Debt Security within the meaning of the Fiscal
Agency Agreement and is registered in the name of Cede & Co., as the nominee of
The Depository Trust Company, a New York Corporation ("DTC"). This Debt Security
may not be exchanged in whole or in part for a debt security registered, and no
transfer of this Debt Security in whole or in part may be registered, in the
name of any person other than DTC or a nominee thereof, except in the limited
circumstances described in the Conditions referred to within this Debt Security.
Unless this certificate is presented by an authorized representative of DTC, to
the Republic of Hungary or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede & Co., or
in such other name as is requested by an authorized representative of DTC (and
any payment is made to Cede & Co., or to such other entity as is requested by an
authorized representative of DTC), any transfer, pledge or other use hereof for
value or otherwise by or to any person is wrongful inasmuch as the registered
owner hereof, Cede & Co. has an interest herein.
PAYABLE AS TO PRINCIPAL AND INTEREST IN LAWFUL MONEY OF
THE UNITED STATES OF AMERICA
FULLY REGISTERED NOTES
***500,000,000.00***
CUSIP No. 000000XX0
COMMON CODE No. 021182273
REGISTERED No. ___
REGISTERED HOLDER: Cede & Co., or its registered assigns
PRINCIPAL SUM OF FIVE HUNDRED MILLION DOLLARS
00
XXX XXXXXXXX XX XXXXXXX (the "Republic"), for value received, hereby promises to
pay to the registered owner specified above or registered assigns on the 3rd day
of February, 2015, upon presentation and surrender of this Global Debt Security,
the principal sum specified above in lawful money of the United States of
America at the office of Citibank, N.A. in London or The City of New York, New
York, and to pay interest thereon in like money in the manner provided in the
Conditions endorsed hereon from February 3, 2005, or from the most recent
interest payment date to which interest has been paid, or duly provided for,
such interest to be payable semi-annually at the rate of four and three-quarters
per centum (4.75%) per annum on the 3rd day of February and on the 3rd day of
August in each year (each an "Interest Payment Date") until the principal of
this Global Debt Security shall have been paid, the first of such payments of
interest to become due and payable on the 3rd day of August, 2005.
Notwithstanding anything to the contrary provided herein, any payment of
principal or interest falling due on a day which is not a Business Day (as
defined in the Fiscal Agency Agreement among the Republic, Citibank, N.A.,
London, and Deutsche Bank Luxembourg S.A., dated as of February 3, 2005) will be
payable on the next succeeding Business Day and no interest shall accrue for the
intervening period, provided however that if that next succeeding Business Day
falls in the next calendar month, such payment of principal or interest will be
payable on the first preceding Business Day. The interest so payable on any such
Interest Payment Date will be paid to the person in whose name this Global Debt
Security is registered at the close of business on the fifteenth day (whether or
not such day is a Business Day) preceding such Interest Payment Date (each a
"Record Date").
This Global Debt Security is a direct, unconditional, unsecured and
general obligation of the Republic. This Global Debt Security ranks and will
rank at least equally in right of payment with all other unsecured and
unsubordinated payment obligations of the Republic outstanding at the date of
issue of this Global Debt Security or issued thereafter, except for such
obligations as may be preferred by mandatory provisions of applicable law. This
Global Debt Security will be backed by the full faith and credit of the
Republic. The Republic will give no preference to one obligation over another on
the basis of priority of issue date or currency of payment.
This Global Debt Security is not redeemable prior to maturity at the
option of the Republic or of the registered holders thereof.
This Global Debt Security is subject to the Conditions endorsed on the
reverse hereof and shall not be valid or enforceable for any purpose unless
authenticated by the manual signature of the Fiscal Agent (as defined in the
Fiscal Agency Agreement). This Global Debt Security shall be dated the date of
its authentication by the Fiscal Agent.
23
IN WITNESS WHEREOF, the Republic has caused this Global Debt Security
to be duly executed by the facsimile signature of Xx. Xxxxxx Xxxxxxx and a
facsimile of the written, printed or stamped name of the Republic to be hereon
imprinted.
On behalf of the Republic of Hungary
By:
-----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Chief Executive Officer of the
Government Debt Management Agency
Ltd. of the Republic of Hungary as
attorney for the Republic of
Hungary represented by its Minister
of Finance
FISCAL AGENT'S CERTIFICATE
OF AUTHENTICATION
This is a permanent global debt security evidencing
the Debt Securities
referred to in the aforementioned
Fiscal Agency Agreement
Citibank, N.A.
By:
-----------------------------------
AUTHORIZED SIGNATURE
DATED:
--------------------------------------------------------------------------------
24
THE CONDITIONS WITHIN REFERRED TO
1. This Global Debt Security is one of the permanent global securities
evidencing a duly authorized issue of 4.75% Notes due 2015 of the Republic (each
a "Debt Security" and, collectively and including this Global Debt Security, the
"Debt Securities"), limited in aggregate principal amount to U.S. $1,500,000,000
and issued under the Fiscal Agency Agreement dated as of February 3, 2005 (as
the same may be amended, supplemented or otherwise modified from time to time,
the "Fiscal Agency Agreement"), among the Republic, Citibank, N.A., London, as
fiscal agent (the "Fiscal Agent" or "Registrar"), and Deutsche Bank Luxembourg
S.A., as Luxembourg paying agent (the "Luxembourg Paying Agent" or "Transfer
Agent" and together with the Fiscal Agent, the "Agents"), to which Fiscal Agency
Agreement reference is hereby made for a statement of the respective rights,
duties, limitations of rights, obligations and immunities thereunder of the
Republic, the Agents and the holders of the Debt Securities. The Debt Securities
are issuable as fully registered Debt Securities without coupons in
denominations of $1,000 and integral multiples of $1,000 in lawful money of the
United States of America.
The Republic may from time to time, without the consent of the holders
of the Debt Securities, create and issue further debt securities having the same
terms and conditions as the Debt Securities in all respects (or in all respects
except for the first payment of interest) so as to form a single series with the
Debt Securities.
2. All payments made in respect of this Global Debt Security,
including payments of principal and interest, to a holder that is not a resident
of the Republic, shall be made by the Republic without withholding or deduction
for or on account of any present or future taxes, duties, levies or other
governmental charges of whatever nature, imposed or levied by the Republic or by
any political subdivision or taxing authority therein or thereof ("Taxes"). If
the Republic is required by law to deduct or withhold any such amounts, it will
pay such additional amounts (including any deduction or withholding with respect
to additional amounts) to the holder hereof who is not a resident of Hungary as
may be necessary so that every net payment of the principal of and interest on
this Global Debt Security paid to such holder after making all such deductions
and withholdings shall equal the amount provided for in this Global Debt
Security to be then due and payable, except that there will be no additional
amounts paid with respect to this Global Debt Security to the holder hereof if
such Taxes:
(i) would not have been imposed but for some present or former
connection (or a connection of a fiduciary, shareholder or
other related party) of the holder with the Republic, including
the holder being or having been a citizen or resident of the
Republic or being or having been engaged in a trade or business
or present in the Republic or having, or having had, a
permanent establishment in the Republic;
(ii) are imposed on a payment to an individual and is required to be
made pursuant to the European Council Directive 2003/48/EC or
any other directive implementing the conclusions of the EU
Council of Finance Ministers meeting of November 26 and 27,
2000 on the taxation of
25
savings income or any law implementing or complying with, or
introduced in order to conform to, such Directive;
(iii) are imposed because the holder presents a Debt Security in
definitive form for payment more than thirty (30) days after
the date on which the payment became due and payable;
(iv) constitute an estate, inheritance, gift, sales, transfer or
personal property tax or any similar tax, assessment or
governmental charge;
(v) are payable other than by withholding;
(vi) would not have been imposed but for the failure to comply with
certification, information or other reporting requirements
concerning the holder's nationality, residence or identity (or
the nationality, residence or identity of the beneficial owner
of this Global Debt Security), if such holder's compliance is
required by the laws of the Republic or of any political
subdivision or taxing authority of the Republic to avoid or
reduce such tax and if such compliance is not materially more
onerous (in form, in procedure and in the substance of
information disclosed) than comparable information or other
reporting requirements imposed under United States tax law;
(vii) are required to be withheld by any paying agent from a payment
on this Global Debt Security if such payment can be made
without such withholding by another paying agent; or
(viii) are imposed as a result of any combination of the items listed
above.
Furthermore, no additional amounts shall be paid with respect to any
Debt Security to a holder who is a fiduciary or partnership or other than the
sole beneficial owner of such payment to the extent that the settlors with
respect to such fiduciary, partner or beneficial owner, as the case may be,
would not have been entitled to payment of such additional amounts if they held
this Global Debt Security themselves.
In the event that the Republic is required to deduct or withhold Taxes
with respect to a holder, the Republic will make such deduction or withholding
and remit the full amount deducted or withheld to the relevant authority in
accordance with applicable law. The Republic will furnish such holder, upon
request, within a reasonable period of time after the date of the payment of any
Taxes due pursuant to applicable law, certified copies of tax receipts
evidencing such payment by the Republic.
3. As long as any Debt Security remains outstanding, the Republic will
not allow any Security Interest to be established on any of the Republic's or
the National Bank of Hungary's assets or revenues, present or future, in order
to secure (i) any Public External Indebtedness of the Republic having an
original maturity of at least one year; or (ii) any Public
26
External Indebtedness of the National Bank of Hungary having an original
maturity of at least one year and incurred on or prior to December 31, 1998,
unless the debt securities are secured equally and rateably to this external
indebtedness.
For these purposes:
"External Indebtedness" means any obligation in respect of existing or
future Indebtedness denominated or payable, or at the option of the holder
thereof payable, in a currency other than the lawful currency of the Republic of
Hungary. If at any time the lawful currency of the Republic of Hungary becomes
the Euro, then External Indebtedness shall also include Indebtedness expressed
in or payable or optionally payable in Euro, if (i) such Indebtedness was issued
after the date on which the Euro became the lawful currency of the Republic of
Hungary, and (ii) more than 50% of the aggregate principal amount of such
Indebtedness was initially placed outside the Republic of Hungary.
"Public External Indebtedness" means External Indebtedness which: (i)
is in the form of, or represented by, bonds, notes or other similar securities;
and (ii) is, or may be, quoted, listed or ordinarily purchased and sold on any
stock exchange, automated trading system or over-the-counter or other securities
market.
"Indebtedness" means any indebtedness of any Person (whether incurred
as principal or surety) for money borrowed.
"Person" means any individual, company, corporation, firm,
partnership, joint venture, association, organization, state or agency of a
state or other entity, whether or not having separate legal personality.
"Security Interest" means any lien, pledge hypothecation, mortgage,
security interest, charge or other encumbrance or arrangement which has a
similar legal and economic effect, and, without limitation, anything analogous
to any of the foregoing under the laws of any jurisdiction.
4. An "Event of Default" means any of the following:
(i) the Republic fails to pay the principal of or interest on any of
the Debt Securities for more than 30 days after payment is due;
or
(ii) the Republic does not perform any of its other covenants under
any of the Debt Securities for more than 60 days after the holder
of the Debt Security has given written notice of the breach to
the Republic at the Fiscal Agent's corporate trust office.
An "Event of Acceleration" means any of the following:
(i) any action, condition or any other thing which at any time is
required to be taken, fulfilled or done in order: (A) to enable
the Republic lawfully to enter into, exercise its rights and
perform and comply with its obligations under and in respect of
the Debt Securities, (B) to ensure that those
27
obligations are legal, valid, binding and enforceable and (C)
subject to their official translation into the Hungarian
language, to make the Debt Securities admissible in evidence in
the courts of the Republic of Hungary, is not taken, fulfilled or
done within 30 days of receipt by the Republic of written notice
thereof; or
(ii) it becomes illegal for the Republic to perform any of its
obligations under the Debt Securities or if these obligations
become invalid and not remedied by the Republic within 30 days'
written notice thereof.
If an Event of Default or an Event of Acceleration occurs, all of the
Debt Securities may, by written notice addressed and delivered by the holders of
at least 25% of the aggregate principal amount of the outstanding Debt
Securities to the Republic at the office of the Fiscal Agent, be declared to be
immediately due and payable, unless prior to such date the Republic shall have
remedied the Event of Default or Event of Acceleration for all the Debt
Securities.
If the Fiscal Agent receives notice in writing from holders of at
least 50% in aggregate principal amount of the outstanding Debt Securities
and/or a resolution is passed at a meeting of the holders of the Debt
Securities, duly convened and held in accordance with the Fiscal Agency
Agreement, to the effect that the Event(s) of Default and/or Event(s) of
Acceleration giving rise to a declaration of acceleration made pursuant to the
conditions above is or are cured or is or are waived by them following any such
declaration and that such holders request the Fiscal Agent to rescind the
relevant declaration, the Fiscal Agent shall, by notice in writing to the
Republic and the holders, rescind the relevant declaration whereupon it shall be
rescinded and shall have no further effect.
The Republic is not obliged to provide investors with periodic
evidence that there are no Events of Default and/or Events of Acceleration.
Please also note that the Fiscal Agency Agreement does not provide for the
holders to be notified of the existence of an Event of Default or an Event of
Acceleration or for any right to examine the Debt Securities register.
5. The Fiscal Agency Agreement contains provisions for convening
meetings of holders of the Debt Securities to consider matters relating to the
Debt Securities, including, without limitation, the modification of any
provision of the terms of the Debt Securities. Any such modification may be made
if, having been approved in writing by the Republic, it is sanctioned by an
Extraordinary Resolution. Such a meeting may be convened by the Republic and
shall be convened by the Fiscal Agent upon the request in writing of holders
holding not less than 10% of the aggregate principal amount of the outstanding
Debt Securities. The quorum at any meeting of holders convened to vote on an
Extraordinary Resolution will be two or more persons holding or representing not
less than 50% of the aggregate principal amount of the outstanding Debt
Securities or, at any adjourned meeting of holders, two or more persons being or
representing holders, whatever the aggregate principal amount of the outstanding
Debt Securities held or represented; provided, however, that any proposals
relating to a Reserved Matter may only be sanctioned by an Extraordinary
Resolution passed at a meeting of holders at which two or more persons holding
or representing not less than 75% of the aggregate principal amount of the
outstanding Debt Securities or, at any adjourned meeting, 25% of the aggregate
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principal amount of the outstanding Debt Securities form a quorum. Any
Extraordinary Resolution duly passed at any such meeting shall be binding on all
the holders of the Debt Securities, whether present or not.
If a resolution is brought in writing, such a resolution in writing
may be contained in one document or several documents in the same form, each
signed by or on behalf of one or more holders.
For these purposes:
"Extraordinary Resolution" means:
(i) in relation to any Reserved Matter:
(x) a resolution passed at a meeting of holders duly convened
and held in accordance with the Fiscal Agency Agreement by a
majority consisting of not less than 75% of the aggregate
principal amount of all outstanding Debt Securities; or
(y) a resolution in writing signed by or on behalf of holders of
not less than 75% of the aggregate principal amount of all
outstanding Debt Securities; and
(ii) in relation to any other matter:
(x) a resolution passed at a meeting of holders duly convened
and held in accordance with the Fiscal Agency Agreement by a
majority consisting of not less than 66.67% of the aggregate
principal amount of the outstanding Debt Securities which
are represented at that meeting; or
(y) a resolution in writing signed by or on behalf of holders of
not less than 66.67% of the aggregate principal amount of
all outstanding Debt Securities.
"Reserved Matter" means any proposal to:
(i) change any date, or the method for determining the date, fixed
for payment of principal or interest in respect of the Debt
Securities, to reduce the amount of principal or interest
payable on any date in respect of the Debt Securities or to
alter the method of calculating the amount of any payment in
respect of the Debt Securities on redemption or maturity or the
date for any such payment;
(ii) effect the exchange or substitution of the Debt Securities for,
or the conversion of the Debt Securities into, shares, bonds or
other obligations or securities of the Republic or any other
person or body corporate formed or to be formed;
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(iii) reduce or cancel the principal amount of the Debt Securities;
(iv) vary the currency or place of payment in which any payment in
respect of the Debt Securities is to be made;
(v) amend the status of the Debt Securities;
(vi) amend the obligation of the Republic to pay additional amounts
under Condition 2;
(vii) amend the Events of Default or the Events of Acceleration set
out in Condition 4;
(viii) amend the law governing the Debt Securities, the courts to the
jurisdiction to which the Republic has submitted in the Debt
Securities, the Republic's obligation to maintain an agent for
service of process in the United States or the Republic's
waiver of immunity, in respect of actions or proceedings
brought by any holder of the Debt Securities set out in
Conditions 6 and 7;
(ix) modify the provisions contained in this Schedule concerning the
quorum required at any meeting of holders of the Debt
Securities or any adjournment thereof or concerning the
majority required to pass an Extraordinary Resolution or the
percentage of votes required for the taking of any action;
(x) change the definition of "Extraordinary Resolution" or
"outstanding" in these conditions of the Debt Securities and/or
in the Fiscal Agency Agreement;
(xi) instruct any holder of the Debt Securities or committee
appointed on behalf of all holders of the Debt Securities
pursuant to the Fiscal Agency Agreement to withdraw, settle or
compromise any proceeding or claim being asserted pursuant to
Condition 4;
(xii) confer upon any committee appointed pursuant to the Fiscal
Agency Agreement any powers or discretions which the holder of
the Debt Securities could themselves exercise by Extraordinary
Resolution; or
(xiii) amend this definition.
The holders of the Debt Securities may, by a resolution passed at a
meeting of holders duly convened and held in accordance with the Fiscal Agency
Agreement by a majority of at least 50% in aggregate principal amount of the
Debt Securities then outstanding, or by notice in writing to the Fiscal Agent
signed by or on behalf of the holders of at least 50% in aggregate principal
amount of the Debt Securities then outstanding, appoint any persons as a
committee to represent the interests of the holders if any of the following
events shall have occurred:
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(i) an Event of Default or an Event of Acceleration;
(ii) any event or circumstance which would, with the giving of
notice, lapse of time, the issuing of a certificate and/or
fulfillment of any other requirement provided for in Condition 4
become an Event of Default or an Event of Acceleration; or
(iii) any public announcement by the Republic, to the effect that the
Republic is seeking or intends to seek a restructuring of the
Debt Securities (whether by amendment, exchange offer or
otherwise).
Such committee in its discretion may, among other things, (i) engage
legal advisers and financial advisers to assist it in representing the interests
of the holders of the Debt Securities, (ii) adopt such rules as it considers
appropriate regarding its proceedings and (iii) enter into discussions with the
Republic and/or other creditors of the Republic. The Republic shall pay any
reasonably incurred fees and expenses of any such committee (including, without
limitation, the fees and expenses of the committee's legal advisers and
financial advisers, if any) within 30 days of the delivery to the Republic of a
reasonably detailed invoice and supporting documentation.
For the purposes of (i) ascertaining the right to attend and vote at
any meeting of the holders of the Debt Securities and (ii) Conditions 4 and 5,
those Debt Securities (if any) which are for the time being held by any person
(including but not limited to the Republic) for the benefit of the Republic or
by any public body owned or controlled, directly or indirectly, by the Republic
shall (unless and until ceasing to be so held) be deemed not to remain
outstanding.
6. As more fully set forth in the Fiscal Agency Agreement, the
Republic has appointed the Embassy of the Republic of Hungary, Office at the
Trade Commissioner, 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
as its authorized agent upon which process may be served in any action arising
out of or based on the Debt Securities which may be instituted in any Federal or
State court in New York, New York by the holder of any Debt Security, and the
Republic hereby expressly accepts the jurisdiction of any such court in respect
of any such action. Such appointment shall be irrevocable so long as any of the
Debt Securities remain outstanding, unless and until a successor shall have been
appointed by the Republic as its authorized agent for such purpose and such
successor authorized agent shall have accepted such appointment. Notwithstanding
the foregoing, any action arising out of or based on the Debt Securities may be
instituted by the holder of any Debt Security in any competent court in the
Republic of Hungary. The Republic hereby waives irrevocably, to the fullest
extent permitted by law, any immunity from jurisdiction to which it might
otherwise be entitled in any such action which may be instituted by the holder
of any Debt Security in Federal or State court in New York, New York or in any
competent court in the Republic of Hungary. This waiver is intended to be
effective upon execution of this Global Debt Security without further act by the
Republic before any such court, and introduction of this Global Debt Security
into evidence shall be final and conclusive evidence of such waiver. Such waiver
constitutes only a limited and specific waiver for the purposes of the Debt
Securities and under no circumstances shall it be interpreted as a general
waiver by the Republic or a waiver with respect to proceedings unrelated to the
Debt Securities. Neither such appointment nor such waiver shall be interpreted
to include the waiver
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of any immunity with respect to: (i) actions brought against the Republic under
U.S. State or Federal securities laws; (ii) present or future "premises of the
mission" as defined in the Vienna Convention on Diplomatic Relations signed in
1961; (iii) "Consular premises" as defined in the Vienna Convention on Consular
Relations signed in 1963; (iv) any other property or assets used solely or
mainly for official state purposes in the Republic or elsewhere; or (v) military
property or military assets or property or assets of the Republic related
thereto.
7. This Global Debt Security shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflicts of law principles of such State (other than Section 5-1401 of the
General Obligation Law of the State of New York), except with respect to its
authorization and execution by the Republic, which shall be governed by the laws
of the Republic of Hungary.
8. Except as set forth in this Condition 8, the Debt Securities are
issuable only as fully registered global securities, without coupons, each
registered in the name of DTC, a nominee thereof or a successor to DTC or a
nominee thereof, and
(i) no Global Debt Security may be transferred, except in whole and
not in part, and only to DTC, one or more nominees of DTC or one
or more respective successors of DTC and its nominees; and
(ii) no Global Debt Security may be exchanged for any Debt Security
other than another Global Debt Security.
Notwithstanding any other provisions of the Fiscal Agency Agreement or
this Global Debt Security, a Global Debt Security may be transferred to, or
exchanged for registered Debt Securities registered in the name of, a person
other than DTC, a nominee of DTC or a successor of DTC or its nominee if:
(i) DTC (a) notifies the Republic that it is unwilling or unable to
continue as depository for such Global Debt Security or (b)
ceases to be a clearing agency registered under the Securities
Exchange Act of 1934 at a time when it is required to be, and in
either such case (a) or (b) a successor depository is not
appointed by the Republic within 90 days after receiving such
notice or becoming aware that DTC is no longer so registered;
(ii) the Republic, in its sole discretion, instructs the Agents in
writing that a Global Debt Security shall be so transferable and
exchangeable; or
(iii) there shall have occurred and be continuing an Event of Default
and/or Event of Acceleration with respect to the Debt Securities
evidenced by this Global Debt Security.
Registered Debt Securities issued in exchange for this Global Debt
Security will be registered in such names, and issued in such denominations (of
$1,000 and integral multiples thereof), as an authorized representative of DTC
shall request.
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9. The Republic will maintain for the Debt Securities (i) a Paying
Agent and Registrar in the City of London, England or The City and State of New
York, and (ii) for so long as the Debt Securities are listed on the Luxembourg
Stock Exchange and the rules of the Luxembourg Stock Exchange so require, a
Paying Agent and Transfer Agent in Luxembourg for the Debt Securities, and (iii)
if the Debt Securities are issued in definitive form, a transfer agent and
paying agent in The City and State of New York. The Republic will cause the
Registrar to maintain a register in which shall be entered the names and
addresses of the holders of the Debt Securities of this issue and the
particulars of the Debt Securities held by them respectively and in which,
subject to Condition 8 above, transfers of the Debt Securities shall be
registered. Such Paying Agent and Registrar in England shall be Citibank, N.A.,
London, and such Paying Agent and Transfer Agent in Luxembourg shall be Deutsche
Bank Luxembourg S.A., unless and until the Republic appoints a different Paying
Agent, Transfer Agent and/or Registrar (as applicable) in the same city. The
Republic will appoint a transfer agent and paying agent as or when required in
The City and State of New York. The holders of the Debt Securities may serve
notices and demands with respect to the Debt Securities at the office of any
Paying Agent, Transfer Agent, and Registrar maintained pursuant to this
Condition. In addition, all notices of the Republic will be published in English
in London in the Financial Times, in New York in The Wall Street Journal (U.S.
Edition), and in Luxembourg in the Luxembourger Wort for so long as the Debt
Securities are listed on the Luxembourg Stock Exchange. If at any time
publication in any such newspaper is not practicable, notices will be valid if
published in such English language newspaper with general circulation in the
respective market regions as the Republic shall determine. Any such notice shall
be deemed to have been given on the date of such publication or, if published
more than once on different dates, on the first date on which publication is
made.
10. Subject to Condition 8 above, this Global Debt Security is
transferable upon presentation for such purpose at the office of the Registrar
or the Transfer Agent referred to in Condition 9, accompanied by a written
instrument of transfer in form approved by the Republic executed by the
registered holder hereof or by his duly authorized attorney, whereupon this
Global Debt Security will be canceled and one or more Debt Securities of this
issue for an equal aggregate principal amount will be delivered to the
transferee.
11. Subject to Condition 8 above, Debt Securities of this issue upon
presentation for such purpose at the office of the Registrar or the Transfer
Agent referred to in Condition 9, accompanied by a written instrument of
transfer in form approved by the Republic executed by the registered holder or
by his duly authorized attorney, may be exchanged for an equal aggregate
principal amount of other fully registered Debt Securities of this issue in
other authorized denominations.
12. Subject to Condition 8 above, the Republic will make transfers and
exchanges of Debt Securities of this issue as aforesaid upon compliance by the
holders of the Debt Securities with such reasonable regulations as may be
prescribed by the Republic, and the Republic shall not be entitled to make any
charge in respect to transfers and exchanges of Debt Securities of this issue,
other than in respect of transfer taxes, if any. Each Debt Security issued upon
any such transfer or exchange shall be dated the date of its authentication by
the Fiscal Agent.
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13. Interest on the Debt Securities of this issue shall be computed on
the basis of a 360-day year of twelve 30-day months. Unless other arrangements
are made, payments of interest on this Global Debt Security will be made by
check drawn on a bank or trust company in The City and State of New York payable
to the order of the registered holder, or, in the case of joint holders, to the
order of all such joint holders or to such person as the joint holders may
request in writing, provided that payment of principal will be made only upon
prior presentation and surrender of this Global Debt Security at the office of a
Paying Agent of the Republic referred to in Condition 9. Such check shall be
mailed to the address of the registered holder as such address shall appear on
the register maintained by the Registrar pursuant to Condition 9 hereof, or, in
the case of joint holders, to such registered address of that joint holder who
is first named in the register as one of such joint holders or to such address
specified in the aforementioned request of such joint holders. The registered
holder hereof or his legal personal representatives will be regarded as
exclusively entitled to the principal moneys hereby secured, and in the case of
joint registered holders of this Global Debt Security the said principal monies
shall be deemed to be owing to them on joint account. Any holder of Debt
Securities, the aggregate principal amount of which equals or exceeds U.S.
$1,000,000, may, by written notice to the Paying Agent no later than the Record
Date therefor, elect to receive the interest payment in respect of such Debt
Securities by wire transfer in same-day funds to a bank account maintained by
such holder in the United States. The Debt Securities do not have the benefit of
any sinking fund obligations.
14. Claims for payment of the principal amount of this Debt Security
shall become void ten years after such principal amount became due and payable.
Claims for payment of interest on this Debt Security shall become void five
years after relevant interest payment date on which the interest became due and
payable.
15. In case any Debt Security shall at any time become mutilated or
destroyed or stolen or lost, and such Debt Security, or evidence of the loss,
theft or destruction thereof (together with the indemnity hereinafter referred
to and such other documents or proof as may be required in the premises) shall
be delivered to the Registrar or the Transfer Agent referred to in Condition 9
above, a new Debt Security of like tenor and date will be issued by the Republic
in exchange for the Debt Security so mutilated, or in lieu of the Debt Security
so destroyed or stolen or lost, but, in the case of any destroyed or stolen or
lost Debt Security, only upon receipt of evidence satisfactory to the Republic
that such Debt Security was destroyed or stolen or lost, and, upon receipt also
of indemnity satisfactory to the Republic. All expenses and reasonable charges
associated with procuring such indemnity and with the preparation,
authentication and delivery of a new Debt Security shall be borne by the owner
of the Debt Security mutilated, destroyed, stolen or lost.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-as tenants in UNIF GIFT MIN ACT-______Custodian_______
common (Cust) (Minor)
TEN ENT-as tenants by Under Uniform Gifts to Minors Act________
the entireties (State)
JT TEN-as joint tenants with right of survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list
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TRANSFER
For Value Received the undersigned hereby sells, assigns and transfers unto
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[name and address including zip code and social security number or other
identifying number of assignee] the within Debt Security, hereby irrevocably
constituting and appointing
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--------------------------------------------------------------------------------
Attorney to transfer the Debt Security on the register kept at the office of the
Registrar of the Republic for such purpose in the Borough of Manhattan, The City
of New York and State of New York, United States of America or London, with full
power of substitution
dated this _______ day of __________, ____. ______________________
Signature
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Debt Security in every particular without
alteration or enlargement or any change whatsoever and must be guaranteed by a
commercial bank or trust company having its principal office or correspondent in
The City of New York or by a member of the New York Stock Exchange.
35
