This is a rough translation of Law
4050/2012 that introduced the CAC in the Greek Bonds. The law was passed on the
23 Feb 2012. Please do not rely on this
translation for any decision as it is not official and may contain many errors,
mistakes and misunderstandings. Only article 1 and 3 is translated.
The President of the Hellenic Republic
We publish the
following law which the Greek parliament approved.
Article 1.
1. For the implementation of the
provisions of the present article we define the meaning of the following terms:
a)
“title”
means a bond, a bond loan or any other loan title, in registered or book entry
form which is under Greek law and
1.Issuer or
guarantor is the Greek state
2.The original duration at the time of issuance was
more than12 months
3.The issuing date preceded the 31st
December 2011
b)
“eligible title” means any title that is
defined by a decision of the council of ministers and in the invitation of the
Greek state as defined in paragraph (2).
c)
“outstanding
principal” means the amount of the eligible titles which has not redeemed
according to the terms of the eligible title on the day which is defined by the
invitation and “aggregate outstanding
principal” means the sum of the outstanding principals of all the eligible
titles which are defined in the relevant decision of the council of ministers
and in the corresponding invitation of the Greek state, as provided in
paragraph (2) with no regard to the series, maturity, coupon or any other
characteristics of the eligible titles.
d)
“amendment”
means the change or the addition of terms in one or more of the eligible titles
or the exchange of one or more of the eligible titles with one or more new
titles.
e)
“new
title” means a bond or bond loan, or any other loan title or guarantee or
financial instrument in registered or book entry form or other equivalent of
the above which is exchanged with one or more eligible titles that are amended.
If the new title is a financial instrument, it is allowed to have its return
linked to the GDP.
f)
“bondholder”
means anyone registered in the System for Monitoring transactions in Book-entry
securities (the “System” or BOGS) of paragraph 1 of article 6 pursuant to Law
2198/1994 (A 43), where the eligible titles are registered as defined in the
paragraph 2 of the invitation.
For the titles
which are not in the System, “bondholder” means (aa) for a bond loan in bearer
form and in accordance with paragraph 5 of article 1 of Law 3156/2003 the
holder of the titles at the date as defined in the invitation, (bb) for the
bond loan with registered bonds as defined in paragraph 5 of article 1 of Law
3156/2003 the owner who is written in the title and (cc) for the bond loan in
book entry form those on which in his behalf there exists proof in accordance
to paragraph 6 of article 1 of Law 3156/2003 on the date of the invitation.
g)
“Process
Manager” means the Bank of Greece.
h)
“investor”
means (aa) for titles registered in the System, the investor who is the
beneficial owner of the title according to paragraph (2) and (4) of article 7
and 8 of pursuant to Law 2198/1994 and (bb) for title not registered in the
system the bondholder.
i)
“Participation”
in the decision process as in paragraph (4) means exclusively the positive or
negative vote of the bondholder who owns outstanding principal of a eligible
titles. Paragraph (2) of the invitation determines the conditions ofand the
ways one can participate, which can also be done by proxy.
j)
The
ministerial council, following the proposal of the Minister of Finance, decides
the commencement of the process of amendment of the eligible titles by the
bondholders, determines the eligible titles and on the exchange it defines the
capital or nominal amount, the coupon or yield, the maturity, the English or
other law that will cover the new titles who are going to be issued by the
Greek state and appoint PDMA (Public Debt Management Agent ΟΔΔΗΧ) to issue
one or more invitation on behalf of the Greek state.
The
invitation calls the bondholders of the eligible titles that are defined in the
invitation to decide within a certain timeframe to decide if they accept the
amendment of the eligible titles as it is proposed by the Greek state and in
accordance with the present article.
The
invitation defines among others: a) the eligible titles, b)the terms which are
to be amended c) the content of the new terms, d) new terms added, e) on the
exchange of the eligible titles, the terms of the new titles, as determined by
a decision of the council of ministers and in addition terms like minimum
denomination, the grace period, the currency, the means of payment, buyback,
events of default, negative pledges, the rights and obligation of the trustees,
the collective action clauses of the new titles etc., f) the timeframe in which
the bondholders of the eligible titles need to decide, g)special terms and the
process of participation and decision making process.
2. The invitation is published on
the internet as determined therein. The time frame which is determined for the
decision making process cannot be less than 10 day from the date of publication
of the invitation.
3. Bondholder can participate in the
process with some or all of the eligible titles that they own. For the
amendment of the eligible titles a quorum of 50% of the aggregate outstanding
capital of all the eligible titles that are defined in the invitation
(“participating Notional”) is demanded and a supermajority of 2/3 of the
participating notional.
4. The part of the outstanding
notional of the eligible titles in which investor is the Greek state or in the
case of eligible titles that are guaranteed by the Greek State and the part of
the outstanding notional of eligible titles to which investor is the issuer or
guarantor, is not taking into account in the calculation of the quorum or in
the calculation of the supermajority that is defined in paragraph ()
5. Eligible titles that have been
issued in a currency other than the Euro are transformed in Euro using the
exchange rate that the ECB has published on the date of the invitation.
6. The participation of a bondholder
in the decision making process as regards the present article is considered by
the process manager, the Greek state, PDMA and its appointees to be in
accordance with the direction and the consent of the investor. The above
mentioned are not responsible towards the bondholder or any third party if the
bondholder participated in the process without the consent of the investor or
in defiance of his orders.
7. The decision of the bondholder is
approved by the process manager and is published in the same way as the
invitation and is approved by the council of ministers and published in the
official government gazette.
8. From the publication of the
approval of the decision by the council of ministers in the official government
gazette the decision of the bondholders as verified by the process manager is
valid against anyone and bounds the whole of the bondholders and investors in
the eligible titles and supersedes any law general or special or executive
decision or agreement that goes against it. In the case of exchange of the
eligible titles and the registration in book entry form of the new titles in
the system, the eligible titles are automatically cancelled and any right or
liability that emanated including all rights and liabilities that were part of
them is cancelled.
9. The issuance of the new titles is
done with a decision of the minister of finance that is published in the
official government gazette. A decision of the minister of Finance that is
published in the official government gazette may further regulate any
technicality that is necessary in the implementation of the present article.
10. The contents of the present
article are of the highest public interest and belong to the class of
overriding mandatory provisions and are of immediate implementation and
supersede any law, general or special, executive decision or agreement
including Law 3156/2003 (A 157) that opposes it and the implementation does not
generate or activate any conventional from the law liability against the issuer
or the guarantor of the titles, apart from those that are explicitly referred
in the present article.
Article 3
The
validity of the present law commences from the publication in the official
government gazette unless it is determined otherwise in parts of their clauses.
