APPLICABLE FINAL TERMS Dated 6 July 2012
SOCIÉTÉ GÉNÉRALE EFFEKTEN GMBH
acting in its own name but for the account of Société Générale Issue of up to EUR 50,000,000 Notes
Series DE3889/12.8, Tranche 1
Unconditionally and irrevocably guaranteed by Société Générale under the € 30,000,000,000 Debt Issuance Programme
PART A – CONTRACTUAL TERMS
The Notes are offered to the public in Germany and Austria for subscription from and including 10 July 2012 to and including 23 August 2012 (12:00 CET), save in the case of early ending or prolongation, as the case may be.
Unless stated otherwise herein, capitalised terms used herein shall be deemed to be defined as such for the purposes of the Terms and Conditions set forth under the heading “Terms and Conditions of the Notes” (the “Conditions”) in the Base Prospectus dated 19 June 2012 (the Base Prospectus) (which (as supplemented by the supplement dated 27 June 2012 (the Supplement)) constitutes a base prospectus for the purposes of the Prospectus Directive (Directive 2003/71/EC) (the Prospectus Directive) as amended (which includes the amendments made by Directive 2010/73/EU (the 2010 PD Amending Directive) to the extent that such amendments have been implemented in a Member State)). This document constitutes the final terms (the Final Terms) of the Notes (the Notes) described herein for the purposes of Article 5.4 of the Prospectus Directive and must be read in conjunction with this Base Prospectus and any Supplement; provided, however, that to the extent such Supplement (i) is published after these Final Terms have been signed and (ii) provides for any change(s) to the Conditions as set out under the heading “Terms and Conditions of the Notes”, such change(s) shall have no effect with respect to the Conditions of the Notes to which these Final Terms relate. Full information on the Issuer, the Guarantor and the offer of the Notes is only available on the basis of the combination of these Final Terms and the Base Prospectus. Prior to acquiring an interest in the Notes described herein, prospective investors should read and understand the information provided in the Base Prospectus and any Supplement(s) and be aware of the restrictions applicable to the offer and sale of such Notes in the United States or to, or for the account or benefit of, U.S. persons. The Base Prospectus, any Supplement(s) and these Final Terms are available for viewing at Société Générale, Frankfurt am Main branch, Neue Mainzer Strasse 46-50, 60311 Frankfurt am Main, Germany and http://prospectus.socgen.com and copies may be obtained free of charge from this address.
The provisions of the Technical Annex apply to these Final Terms and such documents shall be read together. In the event of any inconsistency between the Technical Annex and these Final Terms, these Final Terms shall prevail. The Conditions of the Notes set out in the Base Prospectus shall be amended by incorporating the terms of these Final Terms, and by deleting all provisions not applicable to this Series of Notes. The Consolidated Conditions shall replace the Conditions in their entirety (the Consolidated Conditions). If and to the extent the Consolidated Conditions deviate from the terms of these Final Terms, the Consolidated Conditions shall prevail.
Application will be made to list the Notes on the unregulated market (Open Market, Freiverkehr) of the Frankfurt Stock Exchange.
The information included herein with respect to indices and/or formulas comprising, based on or referring to variations in the prices of one or more share(s) in companies, any other equity or non-equity securities, indices, currencies or currency exchange rates, interest rates, dividends, credit risks, fund units, shares in investment companies, term
units) or the occurrence or not of certain events not linked to the Issuer or the Guarantor or a basket thereof or any combination thereof to which the Notes are linked (the Underlyings) consists only of extracts from, or summaries of, publicly available information. The Issuer and the Guarantor accept responsibility that such information has been correctly extracted or summarised. No further or other responsibility in respect of such information is accepted by the Issuer and the Guarantor. In particular, the Issuer and the Guarantor and the Dealer accept no responsibility in respect of the accuracy or completeness of the information set forth herein concerning the Underlyings of the Notes or that there has not occurred any event which would affect the accuracy or completeness of such information. No person has been authorised to give any information or to make any representation other than those contained in these Final Terms in connection with the issue or sale of the Notes and, if given or made, such information or representation must not be relied upon as having been authorised by or on behalf of the Issuer or the Guarantor. The delivery of these Final Terms at any time does not imply that the information in it is correct as any time subsequent to this date.
The purchase of the Notes issued under the Debt Issuance Programme is associated with certain risks. Each prospective investor in Notes must ensure that the complexity and risks inherent in the Notes are suitable for its investment objectives and are appropriate for itself or the size, nature and condition of its business, as the case may be. No person should deal in the Notes unless that person understands the nature of the relevant transaction and the extent of that person's exposure to potential loss. Each prospective purchaser of Notes should consider carefully whether the Notes are suitable for it in the light of its circumstances and financial position.
The investor should only invest in the Notes if it is able to understand the Conditions. All investors should be versed in respect of the Notes and should particularly understand and comprehend the yield of the Notes (Leistungsversprechen) promised by the Issuer and the Guarantor in its entirety. If this is not the case, an investment in the Notes is not advised.
Prospective investors in Notes should consult their own legal, tax, accountancy and other professional advisers to assist them in determining the suitability of the Notes for them as an investment.
Form of Conditions Consolidated
1. (i) Issuer Société Générale Effekten GmbH
(ii) Guarantor Société Générale
2. (i) Series Number DE3889/12.8
(ii) Tranche Number 1
3. Specified Currency or Currencies Euro (“EUR”) 4. Aggregate Nominal Amount
(i) Tranche Up to EUR 50,000,000*
(ii) Series Up to EUR 50,000,000*
* The actual Aggregate Nominal Amount depends on the number of orders received by Société Générale – but is subject to a size increase or a (partial) repurchase of Notes during their lifetime – limited to the Aggregate Nominal Amount mentioned here. On the basis of this Aggregate Nominal Amount, there cannot be drawn any conclusions in respect of the liquidity of the Notes on the secondary market.
5. Issue Price 100 per cent. of the Aggregate Nominal Amount
6. Specified Denomination(s) EUR 1000
7. (i) Issue Date 30 August 2012
(ii) Interest Commencement Date
if different from the Issue Date Not Applicable
8. Maturity Date 30 August 2018
9. Interest Basis See paragraphs 15 to 18 below
10. Redemption/Payment Basis See paragraphs 20 to 25 below 11. Change of Interest Basis or
Redemption/Payment Basis See paragraphs 15 to 25 below
12. Call/Put Options See paragraph(s) 21 and/or 22 below
13. Status of the Notes Unsubordinated
PROVISIONS RELATING TO INTEREST (IF ANY) PAYABLE
15. Fixed Rate Note Provisions Not Applicable 16. Floating Rate Note Provisions Not Applicable 17. Zero Coupon Note Provisions Not Applicable 18. Structured Note Provisions Not Applicable 19. Dual Currency Note Provisions Not Applicable
PROVISIONS RELATING TO PHYSICAL DELIVERY
20. Physical Delivery Note Provisions Not Applicable PROVISIONS RELATING TO REDEMPTION
21. Redemption at the option of the Issuer (other than for Tax Reasons, if applicable)
Not Applicable 22. Redemption at the option of the
Noteholders Not Applicable
23. Final Redemption Amount Index Linked
(i) Index / Formula See the Schedule
(ii) Calculation Agent responsible for calculating the Final Redemption Amount
(if not the Agent) As provided in the Technical Annex (iii) Provisions for determining the
redemption amount where calculation by reference to Index and/or Formula is
impossible or impracticable As provided in the Technical Annex and as the case may be in the Schedule
24. Maturity Date See paragraph 8 above
25. Early Redemption Amount(s) payable on redemption due to Tax Reasons or due to an Event of Default and/or the method of calculating the same (if required or if different from that set
out in the Conditions) Market Value
26. Credit Linked Note Provisions Not Applicable PROVISIONS RELATING TO KNOCK-IN/-OUT EVENTS
27. Knock-In/-Out Event(s) Not Applicable
GENERAL PROVISIONS APPLICABLE TO THE NOTES
28. Form of Notes Permanent Global Note
29. Payments on Temporary Global Notes
Restricted Not Applicable
30. "Payment Business Day" election Following Payment Business Day 31. Financial Centre(s) As specified in Condition 4(e) 32. Details relating to Partly Paid Notes Not Applicable
33. Details relating to Instalment Notes Not Applicable
34. Redenomination Not Applicable
OTHER FINAL TERMS
35. Other final terms As specified in the Schedule
NOTICES
36. Means of publication Germany: Börsen-Zeitung and Financial Times Deutschland (Financial Times Deutschland only if publication date is a Monday) or http://prospectus.socgen.com
Austria: Amtsblatt zur Wiener Zeitung or http://prospectus.socgen.com
PLAN OF DISTRIBUTION AND ALLOTMENT 38. Notification Process for allotted
amount Not Applicable
39. Tranche reserved to one of the
countries where the Offer is made Not Applicable PLACING AND UNDERWRITING
40. (i) If syndicated, names of
Managers Not Applicable
(ii) Date of Subscription
Agreement Not Applicable
(iii) Stabilising Manager (if any) Not Applicable 41. If non-syndicated, name and address
of the relevant Dealer Société Générale
Tours Société Générale 17, Cours Valmy
92987 Paris-La Défense Cedex 7
42. Total commission and concession There is no commission and/or concession paid by the Issuer to the Dealer or the Managers
Société Générale shall pay to the person(s) mentioned below (each an "Interested Party") the following remunerations for the services provided by such Interested Party to Société Générale in the capacity set out below:
to each relevant distributor, an upfront remuneration of up to 2.00% of the nominal amount of Notes effectively placed on the Issue Date.
43. Whether TEFRA D or TEFRA C rules applicable or TEFRA rules not
applicable Not Applicable
44. Additional selling restrictions Not Applicable
GOVERNING LAW
46. Governing Law The Notes and any non-contractual obligations
arising out of or in connection with the Notes will be governed by, and shall be construed in accordance with, German law.
The Guarantee and any non-contractual obligations arising out of or in connection with the Guarantee will be governed by, and shall be construed in accordance with, French law.
PURPOSE OF FINAL TERMS
These Final Terms comprise the final terms required for the issue of the Notes and public offer in Germany and Austria and listing on the unregulated market (Open Market, Freiverkehr) of the Frankfurt Stock Exchange described herein by Société Générale Effekten GmbH pursuant to its € 30,000,000,000 Debt Issuance Programme for which purpose they are hereby submitted.
RESPONSIBILITY
The Issuer and the Guarantor accept responsibility for the information contained in these Final Terms under § 5 Sec. (4) German Securities Prospectus Act (Wertpapierprospektgesetz).
Information or summaries of information included herein with respect to the Underlying(s) has been extracted or obtained, as the case may be, from general databases released publicly or by any other available information. The Issuer and the Guarantor declare that, to the best of their knowledge, the information contained in these Final Terms is accurate and does not contain any material omissions.
Signed on behalf of the Issuer: Signed on behalf of the Guarantor:
By: Günter HAPP By: Günter HAPP
Duly authorised Duly authorised
By: Achim OSWALD By: Achim OSWALD
PART B – OTHER INFORMATION
1. LISTING AND ADMISSION TO TRADING
(i) Listing Application will be made to list the Notes on the unregulated market (Open Market, Freiverkehr) of the Frankfurt Stock Exchange
(ii) Admission to trading Not Applicable
2. RATINGS
Ratings The Notes to be issued have not been rated.
3. NOTIFICATION AND AUTHORISATION
The Bundesanstalt für Finanzdienstleistungsaufsicht (The BaFin), Germany, has provided the
Austrian Finanzmarktaufsichtsbehörde (FMA), Austria, with a certificate of approval attesting
that the Base Prospectus and the Supplement have been drawn up in accordance with the Prospectus Directive.
The Issuer and the Guarantor have authorised the use of these Final Terms and the Base Prospectus dated 19 June 2012 by the Dealer/Managers and the entities in charge of the distribution of the Notes (the Distributor[s] and, together with the Dealer/Managers, the Financial Intermediaries) in connection with offers of the Notes to the public in Germany and Austria for the period set out in paragraph 14 below ; being specified that names and addresses of the Distributor[s] , if any, are available upon request to the Dealer (specified above in the item 41 of the Part A).
4. INTERESTS OF NATURAL AND LEGAL PERSONS INVOLVED IN THE ISSUE
Save for any fees payable to the Dealer so far as the Issuer is aware, no person involved in the issue of the Notes has an interest material to the offer.
The Issuer and Société Générale expect to enter into hedging transactions in order to hedge the Issuer's obligations under the Notes. Should any conflicts of interest arise between (i) the responsibilities of Société Générale as Calculation Agent for the Notes and (ii) the responsibilities of Société Générale as counterparty to the above mentioned hedging transactions, the Issuer and Société Générale hereby represent that such conflicts of interest will be resolved in a manner which respects the interests of the Noteholders.
5. REASONS FOR THE OFFER, ESTIMATED NET PROCEEDS AND TOTAL EXPENSES (i) Reasons for the offer See “Use of Proceeds” wording in the Base
Prospectus (ii) Estimated net proceeds Not Applicable (iii) Estimated total expenses Not Applicable
(iv) Taxes and other expenses Taxes charged in connection with the subscription, transfer, purchase or holding of the Notes must be paid by the Noteholders and neither the Issuer nor the Guarantor shall have any obligation in relation thereto; in that respect, Noteholders shall consult professional tax advisers to determine the tax regime applicable to their own situation. Other expenses that may be charged to the Noteholders, inter alia by Distributors, in relation to the subscription, transfer, purchase or holding of the Notes, cannot be assessed or influenced by the Issuer or the Guarantor and are usually based on the relevant intermediary's business conditions.
6. YIELD (Fixed Rate Notes only)
Indication of yield Not Applicable 7. HISTORIC INTEREST RATES (Floating Rate Notes only)
Not Applicable
8. PERFORMANCE OF UNDERLYING, EXPLANATION OF EFFECT ON VALUE OF
INVESTMENT AND ASSOCIATED RISKS AND OTHER INFORMATION CONCERNING THE UNDERLYING
Under these Notes, the Noteholders will not receive any coupons during the term of the Notes. At maturity, the Noteholders are entitled to receive at least 100% of the Specified Denomination (the « Minimum Redemption Amount »).
The return under these Notes is totally linked to the performance of the Underlying(s). The return of these Notes is linked to the performances of the Underlying(s) as calculated on pre-determined Valuation Dates, and regardless of the level of such Underlying(s) between these dates. As a result, the Closing Price of the Underlying(s) on these dates will affect the value of the Notes more than any other single factor.
The Notes are different from conventional debt securities in that there will be no periodic payment of interest on the Notes, and the effective yield to maturity of the Notes based on the Minimum Redemption Amount may be less than that which would be payable on such a conventional debt security. Noteholders should realize that the return of only the Minimum Redemption Amount at maturity will not compensate for any opportunity cost implied by inflation and other factors relating to the time value of money.
9. PERFORMANCE OF RATE[S] OF EXCHANGE AND EXPLANATION OF EFFECT ON VALUE OF INVESTMENT (Dual Currency Notes only)
10. OPERATIONAL INFORMATION
(i) ISIN code DE000SG3A403
(ii) Common code Available upon request, as needed
(iii) WKN (Wertpapier Kenn Nummer) SG3A40
(iv) Mnemonic code Not Applicable
(v) Clearing System(s) Clearstream Banking AG, Mergenthalerallee 61, 65760 Eschborn, Germany
11. Delivery Delivery against payment
12. Name(s) and address(es) of Additional Paying Agent(s) and Settlement Agent
(if any) Not Applicable
13. Address and contact details of Société Générale for all administrative
communications relating to the Notes Société Générale Tours Société Générale 17, cours Valmy
92987 Paris La Défense Cedex France Telephone: +33 1 42 13 86 92 (Hotline) Facsimile: +33 1 42 13 75 01
Attention: Equity Derivatives - Client Services Mail: [email protected]
14. PUBLIC OFFERS
This paragraph applies only in respect of any offer of Notes made in any Member State of the European Economic Area (EEA) which has implemented the Prospectus Directive (each, a Relevant Member State), where such offer is not made pursuant to an exemption under the Prospectus Directive, as implemented in that Relevant Member State, from the requirement to publish a prospectus for offers of Notes.
(i) Offer Period From and including 10 July 2012 to and including 23 August 2012 (12:00 CET) in Germany and Austria.
(ii) Offer Price The Notes will be offered at the Issue Price increased by fees, if any, as mentioned below.
(iii) Conditions to which the Offer is subject
Offers of the Notes are conditional on their issue and on any additional conditions set out in the standard terms of business of the Financial Intermediaries, notified to investors by such relevant Financial Intermediaries.
(iv) Description of the application process
Any application for subscription of the Notes shall be sent to Société Générale (see paragraph 13 of Part B above) or any Financial Intermediary.
(v) Details of the minimum and/or
maximum amount of application Minimum subscription amount per investor: EUR 1000
Maximum subscription amount per investor: EUR 50,000,000
(vi) Description of possibility to reduce subscriptions and manner for refunding excess amount paid by
applicants Not Applicable
(vii) Details of the method and time limits for paying up and delivering
the Notes The Notes will be issued on the Issue Date against payment to the Issuer of the net subscription moneys. The settlement of the net subscription moneys and the delivery of the Notes will be executed through the Dealer mentioned above. Investors will be notified by the relevant Financial Intermediary of their allocations of Notes and the settlement arrangements in respect thereof.
(viii) Manner and date in which results
of the Offer are to be made public Not Applicable (ix) Procedure for exercise of any right
of preemption, negotiability of subscription rights and treatment
(x) Categories of potential investors to
which the Notes are offered Offers may be made by the Financial Intermediaries in Germany and Austria to any person. In other EEA countries, offers will only be made pursuant to an exemption from the obligation to publish a prospectus under the Prospectus Directive as implemented in such countries.
(xi) Process for notification to applicants of the amount allotted and the indication whether dealing may begin before notification is
made Notification is made by Société Générale (see
paragraph 13 of Part B above). No dealings in the Notes on a regulated market for the purposes of the Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on Markets in Financial Instruments may take place prior to the Issue Date.
(xii) Amount of any expenses and taxes specifically charged to the
subscriber or purchaser Taxes charged in connection with the subscription, transfer, purchase or holding of the Notes must be paid by the Noteholders and neither the Issuer nor the Guarantor shall have any obligation in relation thereto; in that respect, Noteholders shall consult professional tax advisors to determine the tax regime applicable to their own situation. The Noteholders shall also consult the Taxation section in the Base Prospectus.
Additional subscription fees or purchase fees: 2% of the Specified Denomination per Note being specified that the Distributor[s] can waive such fees.
Post-issuance information: The Issuer does not intend to provide any post-issuance information in relation to any assets underlying issues of Notes constituting derivative securities.
SCHEDULE
(This Schedule forms part of the Final Terms to which it is attached)
Part 1:
1. (i) Issuer Société Générale Effekten GmbH
(ii) Guarantor Société Générale
3. Specified Currency or Currencies Euro (“EUR”) 4. Aggregate Nominal Amount
(i) Tranche Up to EUR 50,000,000*
(ii) Series Up to EUR 50,000,000*
* The actual Aggregate Nominal Amount depends on the number of orders received by Société Générale – but is subject to a size increase or a (partial) repurchase of Notes during their lifetime – limited to the Aggregate Nominal Amount mentioned here. On the basis of this Aggregate Nominal Amount, there cannot be drawn any conclusions in respect of the liquidity of the Notes on the secondary market.
5. Issue Price 100 per cent. of the Aggregate Nominal Amount
6. Specified Denomination(s) EUR 1000
7. (i) Issue Date 30 August 2012
8. Maturity Date 30 August 2018
1.(i) Part B
Listing Application will be made to list the Notes on the unregulated market (Open Market, Freiverkehr) of the Frankfurt Stock Exchange
23. Final Redemption Amount Index Linked
(i) Index/Formula The Issuer shall redeem the Notes on the Maturity Date in accordance with the following formula in respect of each Note: Specified Denomination × [ 100% + 100% x Min (40%; Max ( 0%;Performance(1) ) ) ]
Terms used in the formulae above are described in this Part 2.
Valuation Date(0) 30 August 2012 Valuation Date(1) 23 August 2018
Underlying The following Index as defined below:
Index Name Bloomberg
Ticker
Index
Sponsor Exchange Web Site*
Dow Jones-UBS Commodity IndexSM 3 Month Forward DJUBSF3 Index
Dow Jones Not applicable www.djindexes.com
*The information relating to the past and future performances of the Underlying is available on the website of the Index Sponsor and the volatility can be obtained, upon request, at the specified office of Société Générale (see in address and contact details of Société Générale for all administrative communications relating to the Notes).
Closing Price As defined in Part 1 of the Commodities Technical Annex
S(i) (i from 0 to 1) Closing Price of the Underlying on the Valuation Date(i)
Performance(1) S(1)/S(0)-1
Part 3: Information relating to the Underlying(s)
Information or summaries of information included herein with respect to the Underlying(s) has been extracted or obtained, as the case may be, from general databases released publicly or by any other available information. The Issuer and the Guarantor confirm that such information has been accurately reproduced and that, so far as they are aware and are able to ascertain from information published, no facts have been omitted which would render the reproduced information, inaccurate or misleading.
The index referred to herein (the "Index") is not sponsored, approved or sold by Société Générale. Société Générale shall not assume any responsibility in this respect.The Dow Jones-UBS Commodity IndexesSM are a joint product of S&P/Dow Jones Indices LLC and UBS Securities LLC (“UBS Securities”), and have been licensed for use. “Dow Jones®”, “DJ”, “Dow Jones Indexes”, “UBS”, “Dow Jones-UBS Commodity Index 3 Month ForwardSM”, and “DJUBSF3” are service marks of Dow Jones Trademark Holdings, LLC (“Dow Jones”) and UBS AG (“UBS AG”), as the case may be, have been licensed to S&P/Dow Jones Indices LLC and have been [sub]licensed for use for certain purposes by the Licensee.
The Products are not sponsored, endorsed, sold or promoted by S&P/Dow Jones Indices, LLC, Dow Jones, UBS AG, UBS Securities or any of their subsidiaries or affiliates (the “Index Licensors”). None of the Index Licensors makes any representation or warranty, express or implied, to the owners of or counterparts to the Product(s) or any member of the public regarding the advisability of investing in securities or commodities generally or in the Product(s)
particularly. The only relationship of the Index Licensors with respect to the Dow Jones-UBS Commodity Index 3 Month Forward to the Licensee is the licensing of certain trademarks, trade names and service marks and of the DJUBSF3SM, which is determined, composed and calculated by S&P/Dow Jones Indices, LLC in conjunction with UBS Securities without regard to the Licensee or the Product(s). The Index Licensors have no obligation to take the needs of the Licensee or the owners of the Product(s) into consideration in determining, composing or calculating DJUBSF3SM. None of the Index Licensors is responsible for or has participated in the determination of the timing of, prices at, or quantities of the Product(s) to be issued or in the determination or calculation of the equation by which the Product(s) are to be converted into cash. None of the Index Licensors shall have any obligation or liability, including, without limitation, to Products customers, in connection with the administration, marketing or trading of the Product(s). Notwithstanding the foregoing, UBS AG, UBS Securities, CME Group Inc. and their respective subsidiaries and affiliates may independently issue and/or sponsor financial products unrelated to the Products currently being issued by Licensee, but which may be similar to and competitive with the Products. In addition, UBS AG, UBS Securities, CME Group Inc. and their subsidiaries and affiliates actively trade commodities, commodity indexes and commodity futures (including the Dow Jones-UBS Commodity IndexSM and Dow Jones-UBS Commodity Index Total ReturnSM), as well as swaps, options and derivatives which are linked to the performance of such commodities, commodity indexes and commodity futures. It is possible that this trading activity will affect the value of the Dow Jones-UBS Commodity IndexSM and Products.
The final terms relates only to Products and does not relate to the exchange-traded physical commodities underlying any of the Dow Jones-UBS Commodity IndexSM components. Purchasers of the Products should not conclude that the inclusion of a futures contract in the Dow Jones-UBS Commodity IndexSM is any form of investment recommendation of the futures contract or the underlying exchange-traded physical commodity by the Index Licensors. The information in the final terms regarding the Dow Jones-UBS Commodity IndexSM components has been derived solely from publicly available documents. None of the Index Licensors has made any due diligence inquiries with respect to the Dow Jones-UBS Commodity IndexSM components in connection with Products. None of the Index Licensors makes any representation that these publicly available documents or any other publicly available information regarding the Dow Jones-UBS Commodity IndexSM components, including without limitation a
description of factors that affect the prices of such components, are accurate or complete.
NONE OF THE INDEX LICENSORS GUARANTEES THE ACCURACY AND/OR THE COMPLETENESS OF THE DOW JONESUBS COMMODITY INDEXSM OR ANY DATA RELATED THERETO AND NONE OF THE INDEX LICENSORS SHALL HAVE ANY LIABILITY FOR ANY ERRORS, OMISSIONS OR INTERRUPTIONS THEREIN. NONE OF DOW JONES, UBS AG, UBS SECURITIES, CME INDEXES OR ANY OF THEIR SUBSIDIARIES OR AFFILIATES THE INDEX LICENSORS MAKES ANY WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE LICENSEE, OWNERS OF THE PRODUCT(S) OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE DOW JONES-UBS COMMODITY INDEXSM OR ANY DATA RELATED THERETO. NONE OF THE INDEX LICENSORS MAKES ANY EXPRESS OR IMPLIED WARRANTIES AND EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE DOW JONES-UBS COMMODITY INDEXSM OR ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE INDEX LICENSORS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOSSES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS AMONG UBS SECURITIES, S&P/DOW JONES INDICES LLC AND [THE LICENSEE], OTHER THAN UBS AG AND THE LICENSORS OF S&P DOW JONES INDICES LLC.
Part 4: Additional information
AUSTRIAN TAXATION
Amending and replacing what is included on pages 388 ff of the Debt Issuance Programme Prospectus dated 19 June 2012 (and any supplement thereto), the following applies with regard to the Notes according to Austrian law and practice by the tax authorities when drawing up these Final Terms.
Risk of re-qualification of Notes as investment fund units
Notes with a final redemption amount linked to the performance of a basket of shares may be re-qualified by the tax authorities as foreign investment fund units under certain conditions. Pursuant to Sec 188 of the Austrian Investment Fund Act 2011, a portfolio of assets which is subject to the laws of a foreign country and which is invested according to the principle of
risk-Austrian residents
Income derived from the Notes by individuals with a domicile (Wohnsitz) or their habitual abode (gewöhnlicher Aufenthalt) in Austria or by corporate investors with their corporate seat or place of management in Austria ("residents") is taxable pursuant to the Austrian Income Tax Act (Einkommensteuergesetz) or the Austrian Corporate Income Tax Act (Körperschaftsteuergesetz). Generally for Notes held as private assets, income arising from the Notes qualifies as investment income (Einkünfte aus
Kapitalvermögen). Notes with a final redemption amount linked to the performance of a commodity futures index, even if
capital-guaranteed, are treated as derivatives under the new Austrian income tax law. Income from the Notes (“derivatives” under the income tax laws (Einkünfte aus Derivaten)) comprises in particular realised capital gains, i.e. the difference amounts between acquisition costs and sale or redemption or other settlement proceeds of the Notes.
Hence, any realized capital gains and other income from the Notes will, irrespective of the period of time the Notes have been held for, qualify as investment income (Einkünfte aus Kapitalvermögen) and be subject to income tax at a special rate of 25% provided that the realisation of capital gains or of income from derivatives does not form a focus of a business investor’s activities. Investment income will, inter alia, include income derived from the sale, redemption or other pay-off of the Notes. The tax base is, in general, the difference amount between the sale proceeds or the redemption or other pay-off amount and the acquisition costs. Expenses which are directly connected with income subject to the special tax rate of 25% shall be non-deductible. For Notes held as private assets, the acquisition costs shall not include incidental acquisition costs. For the calculation of the acquisition costs of Notes held within the same Notes account and having the same Notes identification number which are acquired at different points in time, an average price shall apply.
If an Austrian securities account keeping agent or an Austrian paying agent is involved and settles the realization of the capital gain, the income tax will be deducted by applying a 25% withholding tax. The 25% withholding tax deduction will result in a final income taxation for private investors (holding the Notes as private assets) provided that the investor has evidenced the factual acquisition costs of the Notes to the securities account keeping agent.
Withdrawals (Entnahmen) and other transfers of Notes from the securities account (including Notes acquired before April 01, 2012) will be treated as disposals (sales), unless specified exemptions will be fulfilled like the transfer of the Notes to a securities account owned by the same taxpayer (i) with the same Austrian bank, (ii) with another Austrian bank if the account holder has instructed the transferring bank to disclose the acquisition costs to the receiving bank or (iii) with a non-Austrian bank, if the account holder has instructed the transferring bank to transmit the pertaining information to the competent tax office or has himself notified the competent Austrian tax office within a month; or like the transfer without consideration to a securities account held by another taxpayer, if the fact that the transfer has been made without consideration has been evidenced to the securities account keeping agent or the agent has been instructed to inform the Austrian tax office thereof or if the taxpayer has himself notified the competent Austrian tax office within a month.
To the extent that no withholding tax deduction will be effected due to the lacking of an Austrian paying agent and of an Austrian securities account keeping agent, the investment income derived from the Notes will have to be included into the income tax return in line with the provisions of the Austrian Income Tax Act.
Taxpayers, whose regular personal income tax is lower than 25% may opt for taxation of the income derived from the Notes at such regular personal income tax rate. Such application for opting into taxation at the regular personal income tax rate must, however, include all income subject to the special 25% tax rate. Expenses in connection with income subject to final taxation or to the special 25% income tax rate and incurred by the investor are also not deductible for persons having opted for taxation at the regular personal income tax rate.
Losses from Notes held as private assets may only be set off with other investment income (excluding, inter alia, interest income from bank deposits and other claims against banks) and must not be set off with any other income. The Austrian Budget Supplement Act 2012 provides for a mandatory set-off of losses applied as of 1 January 2013 by the Austrian securities account keeping agent to investment income achieved in all securities accounts at the same agent qualifying as private assets. Also losses accrued in private assets between 1 April 2012 and 31 December 2012 will have to be set off by 30 April 2013 by the Austrian securities account keeping agents. A carry-forward of such losses is not permitted.
Income (including capital gains) derived from the Notes which are held as business assets will also be subject to the special tax rate of 25% deducted by way of a withholding tax provided that the realisation of capital gains or of income from derivatives does not form a focus of a business investor’s activities. However, capital gains have to be included in the tax return. Write-downs to the going-concern value and losses derived from the sale, redemption or other pay-off of Notes held as business assets must primarily be set off against positive income from realized capital gains of financial instruments and only half of the
remaining loss may be set off or carried forward against any other income. This applies with effect of April 01, 2012 also to Notes acquired before such date.
For income derived from the Notes which have upon issue not been offered to the public as referred to by the Austrian Income Tax Act, the general income tax rate (as opposed to the 25% special tax rate) will apply.
The formerly applicable provisions on the taxation of speculative transactions do not apply to any Notes acquired against consideration on or after April 01, 2012.
Further, with effect of April 01, 2012, amended exit tax rules have entered into force. Non-residents
Income derived from the Notes by individuals who do not have a domicile or their habitual abode in Austria or by corporate investors who do not have their corporate seat or their place of management in Austria ("non-residents") and who do not have a permanent establishment or permanent agent in Austria is (apart from EU-Withholding tax in specified cases, see below) not taxable in Austria. Thus, non-resident investors – in case they receive income from the Notes through a paying agent or a securities account keeping agent located in Austria - may avoid the application of the 25 per cent. Austrian withholding tax if they keep the Notes in an Austrian deposit account and evidence their non resident-status vis-à-vis the Austrian entity obliged to deduct the Austrian withholding tax . The provision of evidence that the investor is not subject to Austrian withholding tax is the responsibility of the investor.
If Austrian withholding tax has been deducted by the agent, the tax withheld shall be credited or refunded to the non-resident investor upon his/her application, which has to be filed with the competent Austrian tax authority within five calendar years following the date of the imposition of the withholding tax.
Where non-residents receive income from the Notes as part of business income taxable in Austria, they will be subject to the same tax treatment as resident investors.
EU Directive on Taxation of Savings Income
The EU Council Directive 2003/48/EC on taxation of savings income in the form of interest payments applies with effect from 1 July 2005. This directive requires EU Member States to implement an exchange of information between their competent authorities regarding interest payments made in one Member State to beneficial owners who are individuals and resident for tax purposes in another Member State. During a transitional period Austria, - instead of being required to provide information to the authorities of the other Member States – levies an EU Withholding Tax on interest payments by Austrian coupon paying agents to individuals who are beneficial owners of the received payments and who are resident for tax purposes in another EU Member State at a rate of 35 %. In Austria, the deduction of such tax takes place upon payment or deemed payment of interest, sale, refund or redemption of the debt claims, transfers of securities from one securities account to another, physical delivery of securities from securities accounts, changes to the EU Withholding Tax status of the individual and changes of the individual’s residence state. According to an information published by the Austrian Federal Ministry of Finance on August 1, 2005, the Austrian tax authorities will, relating to the Notes, levy EU Withholding Tax as follows: Non-guaranteed difference amounts (difference amounts between issue price and redemption price respectively sale price) will be treated as follows: If a commodity futures index is referred to as underlying, the difference amounts received on the Notes will not be subject to EU Withholding Tax. Under certain circumstances the directive enables investors to avoid such withholding tax if the beneficial owner (investor) submits a particular certificate issued by the competent authority of his Member State of residence to the paying agent aiming at confirming the due declaration of the interest payments in his Member State of residence.
The summary above does not claim to fully describe all tax consequences of a decision to invest in the Notes. It does not take into account or discuss the tax laws of any country other than Austria nor does it take into account specific double taxation treaties nor the investors individual circumstances, financial situation or investment objectives. Prospective investors are advised to consult their own professional advisors with regard to their particular circumstances.
All statements above on tax treatment are based on the assumption that the Austrian tax authorities will not re-characterize the Notes as foreign investment fund units within the meaning of the Austrian Investment Fund Act or as foreign real estate investment fund units within the meaning of the Austrian Real Estate Investment Fund Act (as their practice to date does not indicate).
Austrian law as in force upon having the Final Terms filed and published. The Austrian tax laws have changed due to the entry into force of provisions included in the Austrian Federal Budget Supplement Act 2011, Federal Legal Gazette I 2010/111, in the Austrian Tax Amendment Act 2011, Federal Legal Gazette I 2011/76 and in the Austrian Budget Supplement Act 2012, Federal Legal Gazette I 2011/112 and in the Austrian First Stability Act 2012, Federal Legal Gazette I 2012/22, on 01 April 2012. The Austrian Federal Ministry of Finance has moreover issued and published Guidelines on the Taxation of Investment Income dated 7 March 2012 relating to the application of the new tax laws. Relating to the new tax laws there is currently neither case law nor a secure practice applied by the paying agents and/or securities account keeping agents so that deviations may result from the factual implementation and practice as compared to the legal situation described herein. Prospective investors are therefore explicitly advised to consult their own professional advisers to obtain further information about the tax consequences of the acquisition, ownership, disposition, exchange, exercise, settlement or redemption of the Notes.
The above information is provided with a focus on tax liability by the investor only. The likely performance of deduction of “Kapitalertragsteuer” or of EU Withholding Tax by an Austrian paying agent or securities account keeping agent was described above. However, due to differing factual performances by Austrian paying agents or securities account keeping agents and due to tax rules and tax guidelines leaving discretion to some extent, and in particular with regard to innovative or structured financial instruments, to Austrian entities obliged to deduct withholding tax, no guarantee can be assumed that “Kapitalertragsteuer” or EU Withholding Tax will be deducted in exactly the way described above. The investor is therefore advised to consult with representatives of his Austrian paying agent or securities account keeping agent as to the factual deduction of “Kapitalertragsteuer” or EU Withholding Tax which he may have to face with regard to redemption or other settlement amounts or with regard to sale proceed payments.
Part 5: Additional risk Factors
Further to the risk factors relating to the Issuer, the Group, the Guarantor and the Trust Structure included on pages 55ff of the Base Prospectus dated 19 June 2012, relating to Notes generally included on page 67 of the Base Prospectus, relating to Structured Notes and Dual Currency Notes included on page 75 of the Base Prospectus, relating to Capital Protected Notes included on page 76 of the Base Prospectus, relating to Structured Notes included on pages 84f of the Base Prospectus, relating to Structured Notes based on indices included on pages 85f of the Base Prospectus, relating to Commodity Linked Notes included on page 88 of the Base Prospectus, specific to Notes linked to Futures on Commodities or to Commodity Future Index included on page 88 of the Base Prospectus, relating to General, Market and Other Risks included on pages 67ff of the Base Prospectus and relating to Revenues and Profitability due to Financial Markets Crises included on page 74 of the Base Prospectus, the following particular risk factors apply to the present capital guaranteed and capped commodity futures index linked Notes without interest payments:
Structured Notes
The payment of the Final Redemption Amount under the Notes is determined by reference to a commodity future index. Potential investors should be aware that (i) the market price of such Note may be volatile; (ii) payment of principal may occur at a different time than expected; (iii) upon early redemption by the Issuer, investors may lose all or a substantial portion of the investment; (iv) the price of the commodity futures index may be subject to significant fluctuations that may not correlate with changes in interest rates, currencies or indices; (v) the timing of changes in the price of the commodity futures index may affect the actual yield to investors, even if the average level is consistent with their expectations. In general, the earlier the change of Relevant Factor, the greater the effect on yield.
Capital Protected Notes
If and to the extent that a certain amount has been declared protected in the relevant Final Terms (here 100% of the Specified Denomination), such protection does not necessarily lead to a protection of the invested capital at any given time during the life of the Notes and such protection may only apply on certain dates and subject to certain conditions. The payment of any guaranteed amounts may be affected by the condition (financial or otherwise) of the Issuer and of the Guarantor and an insolvency or inability to pay of the Issuer and/or the Guarantor may cause a total loss of the capital invested by the investor.
Index Disruptions, Adjustments, Extraordinary Events, Hedging Disruption Events and Changes in Law, in each case relating to the Index
The Terms and Conditions of the Notes include provisions under which upon the occurrence of certain Index Disruptions the settlement price of a relevant futures contract or the level of the Index shall be determined alternatively and calculated alternatively or certain modifications shall be made to the terms of the Notes. Furthermore, the Terms and Conditions of the Notes include provisions under which, upon the occurrence of certain Adjustment or Extraordinary Events (non-calculation or non-announcement, replacement, material formula modifications, cancellation, in each case of the Index), of Hedging Disruption
Conditions and/or a substitution of the Index by another Index and/or an early termination of the Notes by the Issuer may occur. In such case the capital guarantee relating to the Final Redemption Amount will not apply and the Maturity Date may be changed.
Final Redemption Amount is capped at 140 per Cent of the Specified Denomination
The Notes reference a formula for the Final Redemption Amount due on the Maturity Date which results in a maximum Final Redemption Amount of 140 per Cent of the Specified Denomination. Potential investors should ensure that they understand that they will not participate in the performance of the underlying commodity futures index above this limited yield.
Performance of the Notes during the lifetime of the Notes
Attention should be paid to the fact that the performance of the Notes during their lifetime may not represent exactly the performance of the Index and may therefore deviate materially from the redemption scenario at maturity as described in the Terms and Conditions. This may mainly affect Notes which are represented by financial instruments for the purpose of hedging by the Issuer or an affiliated company of the Issuer. In addition to the performance of the Index the volatility, interest or other parameters might have a material effect on the performance of the Notes during their lifetime. Only at maturity the investor can claim the redemption amount which is provided by the Terms and Conditions of the Notes in respect to the value of the Index.
Early termination for tax reasons
The Terms and Conditions of the Notes include provisions which upon the occurrence of a Gross-up Event or a law preventing payment by the Issuer or Guarantor to the Noteholders, both relating to the tax laws of Germany or France (the Tax Jurisdictions) may result in an early termination of the Notes by the Issuer. In such case, the provisions relating to the Final Redemption Amount and the Maturity Date will not apply.
Hedging strategies and other actions to be taken by the Issuer
The Issuer and/or any of his affiliates may carry out activities that minimize its and/or their risks related to the Notes, including effecting transactions for their own account or for the account of their costumers and hold long or short positions in the underlying of a Note whether for risk reduction purposes or otherwise. In addition, in connection with the offering of any Notes, the issuer and/or any of its affiliates may enter into one or more hedging transactions with respect to the underlying of a Note. In connection with such hedging or market making activities or with respect to proprietary or other trading activities by the Issuer and/or any of its affiliates, the Issuer and/or any of its affiliates may enter into transactions in the underlying of a Note which may affect the market price, liquidity or value of such underlying and/or of the Notes and which could be deemed to be adverse to the interests of the Noteholders. Further, it is possible that the advisory services which the Issuer and/or its affiliates provide in the ordinary course of its/their business could lead to an adverse impact on the value of the underlying of a Note.
Additional risk factor relating to capital guaranteed index linked Notes
The Issuer and/or any of its affiliates cannot exclude due to restrictions linked to hedging strategies relating to the underlying index that the Final Redemption Amount will not participate in the performance of the underlying index. This may further, in the case of the redemption amount, be due to the occurrence of an Early Redemption Event or of an Adjustment or Extraordinary Event, of an Index Disruption or Hedging Disruption Event or Change in Law relating to the Index or to the repayment of the Final Redemption Amount at 100% of the Specified Denomination.
Risk relating to the underlying Commodity Future Index
Due to the term structure of future prices of commodities, also included in a Commodity Future Index, the price of the Notes might be influenced in a negative way for the Noteholders, depending on any difference between the price of the Future on Commodities to be substituted and the price of the Future on Commodities following such substitution. In particular, as the future contracts (as component of a Commodity Future Index) come to expiration, they are replaced by contracts that have a later expiration. Thus, for example, a contract purchased and held in May may specify a July expiration. As time passes, the contract expiring in July is replaced by a contract with a later expiry, for example, August. This is accomplished by selling the July contract and purchasing the August contract. This process is referred to as “rolling”. If the market for these contracts is (putting aside other considerations) in “backwardation”, where the prices are lower in the distant expiry months than in the nearer expiry months, the sale of the July contract would take place at a price that is higher than the price of the August contract, thereby creating a “roll yield”. If, on the contrary, the market for future contracts is in “contango” the prices of contracts are higher in the
The Index does not reflect the returns of a fully collateralized investment in the Index including the returns on cash collateral invested in U.S. treasury bills. This is due to the fact that the underlying index is calculated on an excess return basis only, i.e. reflects the return of underlying commodity futures price movements only, and does not take into account the return on fully collateralized positions in the underlying commodity futures (the Index is no total return index).
The obligations under the Notes constitute direct, unconditional, unsubordinated and, subject to the Guarantee unsecured limited recourse obligations of the Issuer and shall at all times rank pari passu and without preference among themselves. The Issuer and the Guarantor have entered into a trust agreement (the "Trust Agreement") pursuant to which the Issuer shall, inter alia, (i) issue and redeem the Notes on a fiduciary basis (treuhänderisch) in its own name but for the account of the Guarantor; (ii) collect any proceeds resulting from the issuance of the Notes and forward them to the Guarantor; and (iii) use only the funds made available to it by the Guarantor under the Trust Agreement (which funds shall equal the amount of any payments owed by the Issuer under the Notes as and when such payment obligations fall due and in a manner that allows the Issuer to fulfil its payment obligations in a timely manner) for payments owed under the Notes as and when they fall due and to make such payments on a fiduciary basis in its own name but for the account of the Guarantor. The Issuer’s ability to satisfy its payment obligations under the Notes in full is therefore dependent upon it receiving in full the amounts payable to it by the Guarantor under the Trust Agreement.
Due to this trust structure, the Noteholders directly depend on the credit risk of the Guarantor (see "Creditworthiness of the Guarantor" on page 65 of the Base Prospectus dated 19 June 2012) rather than that of the Issuer. Any payment obligations of the Issuer under the Notes are limited to the funds received from the Guarantor under the Trust Agreement. To the extent the funds to be received from the Guarantor under the Trust Agreement prove ultimately insufficient to satisfy the claims of all Noteholders in full, then any shortfall arising therefrom will be extinguished and no Noteholder has any further claims against the Issuer (subject, however, to the right to exercise any termination or early redemption rights). This applies irrespective of whether the Issuer would be able to make such payments out of other funds available to it.
TERMS AND CONDITIONS OF THE NOTES
The following, together with the Technical Annex (if applicable), are the Terms and Conditions (the Conditions) of the Notes to be issued under German law. The applicable Final Terms in relation to any Tranche of Notes may specify other terms and conditions which shall, to the extent so specified or to the extent inconsistent with the following Conditions, complete the following and meet the purpose of such Notes.
The blanks in these Conditions which are applicable to the Notes shall be deemed to be completed by the information contained in the applicable Final Terms as if such information were inserted in the blanks of such provisions; any provisions of the Final Terms completing, in whole or in part, the provisions of these Conditions shall be deemed to so complete the provisions of these Conditions; alternative or optional provisions of these Conditions as to which the corresponding provisions of the applicable Final Terms are not completed or are deleted shall be deemed to be deleted from these Conditions; and all provisions of these Conditions which are inapplicable to the Notes (including instructions, explanatory notes and text set out in square brackets) shall be deemed to be deleted from these Conditions, as required to give effect to the terms of the applicable Final Terms.
This Note is one of a Series (as defined below) of Notes. Reference herein to the Issuer shall be references to Société Générale Effekten GmbH, as specified in the applicable Final Terms (as defined below) and in the case of any substitution of the Issuer in accordance with Condition 11, the Substitute Debtor as defined in Condition 11). References herein to the Notes shall be references to the Notes of this Series and shall mean (i) in relation to any Note(s) represented by a global Note, units of each Specified Denomination in the Specified Currency of issue and (ii) any global Note in bearer form (a Global Note).
References herein to Noteholder in relation to any Notes shall mean the holders of the Notes and shall, in relation to any Notes represented by a Global Note, be construed as provided below.
References herein to “Clearing System“ (as defined below) shall, whenever the context so permits, be deemed to include a reference to any additional or alternative clearing system specified in the applicable Final Terms and approved by the Issuer, the Guarantor, the Agent, and in the case of Notes listed in a stock exchange, such stock exchange.
The final terms for this Note (or other relevant provisions thereof) are set out in Part A of the Final Terms that are endorsed on, attached to, incorporated by reference in, this Note and which complete these terms and conditions (the Conditions). The applicable final terms (or other relevant provisions thereof) complete these Conditions and may specify other terms and conditions which shall, to the extent so specified or to the extent inconsistent with these Conditions, replace or modify these Conditions for the purposes of this Note.
References herein to the applicable Final Terms are to Part A of the Final Terms (or other relevant provisions thereof) and, if applicable, the schedule to the applicable Final Terms (the Schedule), which applicable Final Terms are endorsed on, attached to, incorporated by reference in, this Note.
References herein to Tranche shall mean Notes which are identical in all respects and references herein to Series shall mean a Tranche of Notes together with any further Tranche or Tranches of Notes which are (a) expressed to be consolidated and form a single Series and (b) identical in all respects except for their respective Issue Date and/or Issue Price.
References herein to Physical Delivery Notes shall mean any Series of Notes specified as such in the applicable Final Terms in respect of which an amount of principal and/or interest is payable and/or (by reference to any
Guarantee (as defined in Condition 2(b)) in respect of any Notes issued by the Issuer. Accordingly, references herein to the Guarantor are applicable only in the context of such Notes.
BASIC TERMS
CONDITION 1 - FORM, DENOMINATION, TITLE AND REDENOMINATION
The Notes are issued in bearer form in EUR (the Specified Currency) in the aggregate nominal amount of up to EUR 50,000,000 (the Aggregate Nominal Amount), divided into Notes in the specified denomination of EUR 1,000 (the Specified Denomination) each.
The Notes are represented by a permanent global bearer Note (a Permanent Global Note) without interest coupons. The Permanent Global Note shall bear the manual or facsimile signatures of two duly authorised officers of the Issuer.
The right of the Noteholders to require the issue and delivery of definitive Notes is excluded.
The Permanent Global Note will be held in custody by or on behalf of Clearstream Banking AG, Frankfurt (Clearstream Banking, Frankfurt or CBF) (the Clearing System) until all obligations of the Issuer under the Notes have been satisfied.
The Issuer may (if so specified in the applicable Final Terms), on any Interest Payment Date as specified in the applicable Final Terms, without the consent of the Noteholders, in accordance with Condition 12, and on or after the date on which the European Member State in whose national currency the Notes are denominated has become a participating Member State in the third stage of the European Economic and Monetary Union (as provided in the Treaty on the Functioning of the European Union (the EU), as amended from time to time (the Treaty)) or events have occurred which have substantially the same effects (in either case, EMU), redenominate all, but not only some, of the Notes of any Series into Euro and adjust the Aggregate Nominal Amount and the Specified Denomination(s) set out hereon accordingly, as described above. The date on which such redenomination becomes effective shall be referred to in these Terms and Conditions as the Redenomination Date.
The redenomination of the Notes pursuant to the above paragraph shall be made by converting the principal amount of each Note from the relevant national currency into Euro using the fixed relevant national currency Euro conversion rate established by the Council of the European Union pursuant to Article 140 of the Treaty and rounding the resultant figure to the nearest 0.01 Euro (with 0.005 Euro being rounded upwards), provided that, if the Issuer determines, with the agreement of the Agent that the then market practice in respect of the redenomination in euro of internationally offered securities is different from the provisions specified above, such provisions shall be deemed to be amended so as to comply with such market practice and the Issuer shall promptly notify the Noteholders, the stock exchange (if any) on which the Notes may be listed and the Paying Agents of such deemed amendments. If the Issuer so elects, the figure resulting from conversion of the principal amount of each Note using the fixed relevant national currency Euro conversion rate shall be rounded down to the nearest Euro. The Euro denominations of the Notes so determined shall be notified to Noteholders in accordance with Condition 12. Any balance remaining from the redenomination with a denomination higher than 0.01 Euro shall be paid by way of cash adjustment rounded to the nearest 0.01 Euro (with 0.005 Euro being rounded upwards). Such cash adjustment will be payable in Euros on the Redenomination Date in the manner notified to Noteholders by the Issuer.
Upon redenomination of the Notes, any reference hereon to the relevant national currency shall be construed as a reference to Euro.
desirable to give effect to the provisions of this Condition or Condition 16 (including, without limitation, any change to any applicable business day definition, business day convention, principal financial centre of the country of the Specified Currency, interest accrual basis or benchmark), taking into account market practice in respect of redenominated euromarket debt obligations and which it believes are not prejudicial to the interests of the Noteholders. Any such changes or additions shall, in the absence of manifest error, be binding on and shall be notified to Noteholders in accordance with Condition 16 as soon as practicable thereafter.
Neither the Issuer nor any Paying Agent shall be liable to any Noteholder or other person for any commissions, costs, losses or expenses in relation to or resulting from the credit or transfer of Euro or any currency conversion or rounding effected in connection therewith.
CONDITION 2 - STATUS OF THE NOTES AND THE GUARANTEE
(a) Status of the Notes
The obligations under the Notes constitute direct, unconditional, unsubordinated and, subject to the Guarantee, unsecured limited recourse obligations of the Issuer and shall at all times rank pari passu and without any preference or priority among themselves.
The payment obligations of the Issuer under the Notes (save for certain obligations preferred by mandatory provisions of statutory law) shall rank pari passu with all other unsecured obligations (other than subordinated obligations, if any) of the Issuer from time to time outstanding.
(b) Guarantee
The Guarantor has given an unconditional and irrevocable guarantee dated 19 June 2012 (the Guarantee) for the due and punctual payment of principal of, and interest on, and any other amounts expressed to be payable under the Notes and/or the due and punctual physical delivery of securities deliverable under or in respect of the Notes for the benefit of the Noteholders.
CONDITION 3 - INTEREST
Not Applicable.
CONDITION 4 - PAYMENTS
For the purposes of this Condition 4, references to payment or repayment (as the case may be) of principal and/or interest and other similar expressions will, where the context so admits, be deemed also to refer to delivery of the Underlying Asset(s) with respect to any Physical Delivery Amount(s).
(a) Payment of Principal
Payment of principal in respect of the Notes shall be made, subject to subparagraph (c) below, to the Clearing System or to its order for credit to the accounts of the relevant account holders of the Clearing System.
(b) Payment of Interest
Payment of interest on Notes shall be made, subject to subparagraph (c) below, to the Clearing System or to its order for credit to the accounts of the relevant account holders of the Clearing System.
