Bond CADESIA 1.875% ( FR0010941732 ) in USD

CADESIA

100 % ▼

France

FR0010941732 ( in USD )

1.875% per year ( payment 2 times a year)

15/09/2015 - Bond has expired

Prospectus brochure of the bond Cades FR0010941732 in USD 1.875%, expired

1 000 USD

1 500 000 000 USD

CADES (CMS Advanced Electronic Signatures) is a standard for digitally signing electronic documents, offering various signature levels with varying degrees of security and trust.

The Bond issued by CADESIA ( France ) , in USD, with the ISIN code FR0010941732, pays a coupon of 1.875% per year.
The coupons are paid 2 times per year and the Bond maturity is 15/09/2015

BASE PROSPECTUS
28 May 2010

CAISSE D'AMORTISSEMENT DE LA DETTE SOCIALE
Établissement public national administratif (French national public entity)
(Established in Paris, France)
EURO 75,000,000,000
DEBT ISSUANCE PROGRAMME

Under the Debt Issuance Programme (the "Programme"), described in this base prospectus (the "Base
Prospectus"), Caisse d'amortissement de la dette sociale (the "Issuer" or "CADES"), subject to compliance with
all relevant laws, regulations and directives, may from time to time issue debt instruments (the "Notes"). The
aggregate nominal amount of Notes outstanding will not at any time exceed euro 75,000,000,000 (or the equivalent
in other currencies) unless the amount of the Programme is increased following the date hereof.
Notes issued under the Programme may be admitted to trading on and/or quotation by such stock exchanges, listing
authorities and/or quotation systems as may be agreed between the Issuer and the relevant Dealer(s), or may be
unlisted, in each case as specified in the relevant Final Terms. This Base Prospectus has been submitted to the
Autorité des Marchés Financiers (the "AMF") and has received from AMF visa n°10-156 on 28 May 2010.
Notes shall be governed by French law and may be issued either in dematerialised form ("Dematerialised Notes")
or in materialised form ("Materialised Notes") as more fully described herein. Dematerialised Notes will at all
times be in book entry form in compliance with Article L.211-3 of the French Code monétaire et financier. No
physical document of title will be issued in respect of the Dematerialised Notes.
Notes issued under the Programme have, at the request of the Issuer, been rated Aaa and P-1 by Moody's Investors
Service, AAA and A-1+ by Standard & Poor's Ratings Services, a Division of the McGraw Hill Companies,
Inc. and AAA and F1+ by Fitch Ratings, in respect of the Issuer's long-term and short-term debt, respectively.
Tranches of Notes (as defined in "Summary of the Programme") issued under the Programme may be rated or
unrated. Where a Tranche of Notes is rated, such rating will not necessarily be the same as the ratings assigned to
the Notes. A security rating is not a recommendation to buy, sell or hold securities and may be subject to
suspension, reduction or withdrawal at any time by the assigning rating agency. Furthermore, the Issuer may at
any time reduce the number of rating agencies from which it requests ratings.
The price and the amount of the relevant Notes to be issued under the Programme will be determined by the Issuer
and the relevant Dealer based on their prevailing market conditions at the time of the issue of such Notes and will
be set out in the relevant Final Terms.
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This Base Prospectus (together with any Supplements hereto (each a "Supplement" and together the
"Supplements") comprises a prospectus for the purposes of Article 5.4 of Directive 2003/71/EC (the "Prospectus
Directive") and for the purpose of giving information with regard to CADES and the Notes which, according to
the particular nature of the Issuer and the Notes, is necessary to enable investors to make an informed assessment
of the assets and liabilities, financial position, profit and losses and prospects of the Issuer.
The Issuer having taken all reasonable care to ensure that such is the case, confirms that the information contained
in this Base Prospectus with respect to it and the Notes in the context of the issue and offering of such Notes, is, to
the best of its knowledge, in accordance with the facts and contains no omission likely to affect its import. The
Issuer accepts responsibility for the information contained in this Base Prospectus accordingly.
No person has been authorised to give any information or to make any representation other than those contained in
this Base Prospectus in connection with the issue or offering of the Notes and, if given or made, such information
or representation must not be relied upon as having been authorised by the Issuer or any of the Dealers (as defined
in "Summary of the Programme"). Neither the delivery of this Base Prospectus nor any sale made in connection
herewith shall, under any circumstances, create any implication that there has been no change in the affairs of the
Issuer since the date hereof or the date upon which this Base Prospectus has been most recently amended or
supplemented or that there has been no adverse change in the financial position of the Issuer since the date hereof
or the date upon which this Base Prospectus has been most recently amended or supplemented or that any other
information supplied in connection with the Programme is correct as of any time subsequent to the date on which it
is supplied or, if different, the date indicated in the document containing the same.
The distribution of this Base Prospectus and the offering or sale of the Notes in certain jurisdictions may be
restricted by law. Persons into whose possession this Base Prospectus comes are required by the Issuer, the Dealers
and the Arrangers to inform themselves about and to observe any such restriction. The Notes have not been and
will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") or with
any securities regulatory authority of any state or other jurisdiction of the United States and the Notes may include
Materialised Notes in bearer form that are subject to U.S. tax law requirements. Subject to certain exceptions,
Notes may not be offered, sold or, in the case of Materialised Notes in bearer form, delivered within the United
States. For a description of certain restrictions on offers and sales of Notes and on distribution of this Base
Prospectus, see "Subscription and Sale".
The Notes have not been registered under the U.S. Securities Act of 1933 or under any other applicable securities
laws and may include Materialised Notes in bearer form that are subject to U.S. tax law requirements. Therefore,
the Notes may not be offered or sold within the United States or to, or for the account or benefit of, any U.S.
person unless the offer or sale would qualify for registration exemption from the U.S. Securities Act of 1933 and
the securities laws of any other applicable jurisdiction. Accordingly, the Notes may only be offered outside the
United States in reliance on Regulation S under the U.S. Securities Act of 1933. Prospective purchasers are
hereby notified that the seller of the Notes will be relying on the exemptions from provisions of Section 5 of the
U.S. Securities Act of 1933 provided by Regulation S.
This Base Prospectus is being provided for informational use in connection with consideration of a purchase of the
Notes to qualified purchasers in offshore transactions complying with Rule 903 or Rule 904 of Regulation S under
the U.S. Securities Act. Its use for any other purpose is not authorised. In the United States this Base Prospectus
is confidential, and may not be distributed or copies made of it without the Issuer's prior written consent other than
to people whom investors may have retained to advise them in connection with any offering.
Neither the U.S. Securities and Exchange Commission (the "SEC") nor any other securities commission,
governmental agency or regulatory authority, has approved or disapproved of the Notes or determined if this Base
Prospectus is truthful or complete. Any representation to the contrary is a criminal offence
Neither this Base Prospectus nor any Final Terms constitute, and neither this Base Prospectus nor any Final Terms
may be used for the purposes of, an offer, invitation or solicitation by anyone in any jurisdiction or in any
circumstances in which such offer, invitation or solicitation is not authorised or to any person to whom it is
unlawful to make such offer, invitation or solicitation and no action is being taken to permit an offering of the
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Notes or the distribution of this Base Prospectus or any Final Terms in any jurisdiction where such action is
required.
No Dealer has separately verified the information contained in this Base Prospectus. No Dealer makes any
representation, express or implied, or accepts any responsibility or liability, with respect to the accuracy or
completeness at any time of any of the information in this Base Prospectus or any Final Terms. Neither this Base
Prospectus nor any Final Terms nor any other financial statements are intended to provide the basis of any credit or
other evaluation and neither this Base Prospectus, nor any Final Terms nor any other financial statements should be
considered as a recommendation by the Issuer or any Dealer that any recipient of this Base Prospectus and/or any
Final Terms and/or any such other financial statements should purchase the Notes. Each potential purchaser of
Notes should determine for itself the relevance of the information contained in this Base Prospectus and/or any
Final Terms and its purchase of Notes should be based upon such investigation, as it deems necessary. No Dealer
undertakes to review the financial condition or affairs of the Issuer during the life of the arrangements
contemplated by this Base Prospectus nor to advise any investor or potential investor in the Notes of any
information coming to the attention of any Dealer.
In connection with the issue of any Tranche, and unless otherwise agreed between the Issuer and the Relevant
Dealer(s), the Relevant Dealer or, in the case of a Syndicated Issue, the Lead Manager shall act as a stabilising
manager (the "Stabilising Manager"); provided that a different Stabilising Manager may not act upon the issue of
a further Tranche of an existing Series until all previous stabilisation activity in respect of that Series has
terminated. The Stabilising Manager may, to the extent permitted by applicable laws and directives, over-allot
Notes or effect transactions with a view to supporting the market price of the Notes at a level higher than that
which might otherwise prevail, but in doing so the Stabilising Manager shall not act as agent of the Issuer and any
loss resulting from over-allotment and stabilisation shall be borne, and any profit arising from them shall be
beneficially retained, by the Stabilising Manager or, as the case may be, the Relevant Dealers in the manner agreed
between them. Any stabilisation action may begin on or after the date on which adequate public disclosure of the
final terms of the offer of the relevant Tranche is made and, if begun, may be ended at any time, but it must end no
later than the earlier of (i) 30 days after the issue date of the relevant Tranche and (ii) 60 days after the date of the
allotment of the relevant Tranche. Such stabilisation shall be carried out in accordance with applicable laws and
regulations and the Issuer shall not be liable in respect thereof.
In this Base Prospectus, unless otherwise specified or the context otherwise requires, references to "U.S.$",
"USD" and "U.S. dollars" are to the currency of the United States of America, and references to "euro", "EUR"
or "" are to the single currency of the participating Member States of the European Union.

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NOTICE TO NEW HAMPSHIRE RESIDENTS
Neither the fact that a registration statement or an application for a license has been filed under Chapter 421-B of
the New Hampshire Revised Statutes Annotated 1995, as amended (the "RSA"), with the State of New Hampshire
nor the fact that a security is effectively registered or a person is licensed in the State of New Hampshire
constitutes a finding by the secretary of state of New Hampshire that any document filed under RSA 421-B is true,
complete and not misleading. Neither any such fact nor the fact that an exemption or exception is available for a
security or a transaction means that the secretary of state of New Hampshire has passed in any way upon the merits
or qualifications of, or recommended or given approval to, any person security or transaction. It is unlawful to
make, or cause to be made, to any prospective investor, customer or client any representation inconsistent with the
provision of this paragraph.

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TABLE OF CONTENTS
SUMMARY (ENGLISH VERSION) .............................................................................................. 6
TRADUCTION EN FRANCAIS DU RÉSUMÉ ............................................................................... 13
RISK FACTORS ..................................................................................................................... 20
GENERAL DESCRIPTION OF THE PROGRAMME ....................................................................... 24
TERMS AND CONDITIONS OF THE NOTES ............................................................................... 30
TEMPORARY GLOBAL CERTIFICATES ISSUED IN RESPECT OF MATERIALISED NOTES ................ 49
USE OF PROCEEDS ............................................................................................................... 50
DESCRIPTION OF CADES ....................................................................................................... 51
ANNUAL STATEMENTS 2008 .................................................................................................. 59
ANNUAL STATEMENTS 2009 ................................................................................................ 115
SUBSCRIPTION AND SALE ................................................................................................... 165
PRO FORMA FINAL TERMS .................................................................................................. 169
GENERAL INFORMATION .................................................................................................... 192

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SUMMARY (ENGLISH VERSION)
This summary (the "Summary") is provided for the purposes of the issue of Notes of a denomination of less than
Euro 50,000 (or its equivalent in other currencies). Investors in Notes of a denomination equal to or greater than
Euro 50,000 should not rely on this summary in any way and the Issuer accepts no liability to such investors. This
summary must be read as an introduction to this Base Prospectus. Any decision to invest in any transactions or
financial instruments should be based on a consideration of this Base Prospectus. Where a claim relating to
information contained in the Base Prospectus is brought before a court, the plaintiff may, under the national
legislation of the European Economic Area State (an "EEA State"), be required to bear the costs of translating this
Base Prospectus before the legal proceedings are initiated. Persons who have tabled the summary, including its
translation if any, and who have requested its modification further to article 212-42 of the AMF General
Regulations, would be subject to civil liability if such summary is misleading, inaccurate or inconsistent when read
together with theo ther parts of the Base Prospecuts.
The following summary is qualified in its entirety by the remainder of this Base Prospectus.
Words and expressions defined in "Terms and Conditions of the Notes" below shall have the same meanings in this
summary.
Essential characteristics and risks associated with the Issuer
The Issuer
In December 1995 law No 95-1348 was adopted authorising the French government to take a series of measures by
way of legislation by ordinances over the subsequent four month period to reform the social benefits system. One
such measure was to define the conditions for consolidating and paying off the debts accumulated by the general
social security system.
Accordingly, the Caisse d'amortissement de la dette sociale (CADES) was created with effect from 1 January 1996
by ordinance No 96-50 of 24 January 1996 and by decree No 96-353 of 24 April 1996 as amended by the law No
97-1164 of 19 December 1997 (the "Ordinance") as an national administrative public agency (établissement public
national à caractère administratif) under the control of the minister in charge of economy and finance and the
minister in charge of social security. Initially CADES had a duration of thirteen years and one month that was
extended to eighteen years and one month by law No 97-1164 of 19 December 1997. Law No 2004-810 of
13 August 2004 extended CADES' duration until it has fulfilled its purpose.
The purpose of CADES is:
-
to pay off the cumulative debt of the central social security administration (the Agence centrale des
organismes de sécurité sociale) to the Caisse des dépôts et consignations, of an aggregate amount of euro
34.15 billion (FRF 224 billion), corresponding to the financing of the deficits for the fiscal years 1994 to
1998;
-
to pay euro 1.9 billion (FRF 12.5 billion) to the French state every year from 1996 to 2008 (now modified
to 4 annual payments of euro 3 billion every year from 2002 to 2005) in connection with the transfer to
CADES of the repayment debt of the social security system in the amount of euro 16.8 billion assumed by
the French state in January 1994 and previously assumed by the National Fund for the Elderly Fonds de
Solidarité Vieillesse ("FSV"); and
-
in addition, to pay during 1996 only, an aggregate amount of Euro 0.45 billion (FRF 3 billion) to the
National fund for health insurance of non-wage earning persons in non-agricultural professions (Caisse
Nationale d'Assurance Maladie et Maternité des Travailleurs Non-Salariés des Professions Non-Agricoles).
The Budget bills for the Social Benefits System per fiscal year 2003 and 2004 provide for an exceptional payment
of Euro 1.28 billion in 2003 and Euro 1.1 billion in 2004 to various social security funds.
Other laws concerning CADES are as follows:
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Under a law of 13 August 2004, the transferred debt of the French health insurance system has increased
by a maximum of Euro 50 billion and the taxable base for CRDS is enlarged from 95% to 97% of the
gross wage. The assumed debt in 2004 was Euro 35 billion and Euro 6.6 billion in 2005; the estimated
assumed debt for 2006 is Euro 6.7 billion. Any future surpluses of the French health insurance system
shall be allocated to CADES;
-
Under the Social Security Organic Act 2005, all subsequent transfers of debt to CADES must be
accompanied by a concomitant rise in tax revenue;
-
Under Law 2005-842, life insurance policies stated in Euros are now allowed to be transformed into unit-
linked contracts which may impact on the social taxes collected;
-
Under the Social Security Financing Act 2006 (dated 19 December 2005), CADES has been assigned an
annual amortisation target. In addition, home savings contracts that are in force for more than ten years
will now become subject to social taxation; and
-
By the Finance Act 2006 (dated 30 December 2005), the government order of 1996 has been modified so
as to authorise the finance minister to issue on behalf of CADES, subject to the enactment of a decree
specifying the technical conditions of application. As at 30 April 2009, no such decree has been enacted.
On 6 October 2006 CADES has received the last transfer of debt from the French health insurance system
which was Euro 5.7 billion. The total debt transferred reaches Euro 47.3 billion: Euro 35 billion in 2004,
Euro 6.6 billion in 2005 and Euro 5.7 billion in 2006.
-
Under the Social Security Financing Act 2009 (dated 17 December 2008), Law 2008-1330, the cumulative
deficits on 31 December 2008 of the French Health insurance system are secured by transfers from
CADES to ACOSS during 2009 for a maximal amount of Euro 27bn. In accordance with the organic law
N°2005-881 of 2 August 2005 on social security, in addition to the CRDS it already receives, CADES
gets additional resources of 0,2% of CSG (contribution sociale généralisée). This new resource level as of
1 January 2009 enables CADES to amortize its total debt in the same time frame as before.
-
Decree N°2008-1375 defines the schedule of this transfer in three payments to ACOSS, the first before
5 January 2009 for 10bn, the second before 6 February 2009 for 10bn, and the balance before 6 March
2009.
Essential risks associated with the Issuer
Payment risks
Credit risk in relation to CADES is limited, because of the fact that the State is ultimately responsible for the
solvency of CADES and because of the allocation of resources to CADES by the government.
Market risks
CADES faces interest rate risks, exchange rate risks and counterparty risks. These risks are hedged by the limits
fixed by the board of directors that bring the exchange rate risks to a residual level. Otherwise, CADES does not
face any liquidity risk as a result its status as administrative public agency (établissement public national à
caractère administratif).
Other debt instruments
Similar listed debt instruments to the Notes, which could be issued under this Base Prospectus, are currently listed
on the Paris Stock Exchange and the Luxembourg Stock Exchange.
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Legal risks
CADES is subject to all laws and regulations governing public agencies and in particular to the law on public
procurements (Code des marchés publics). CADES appoints specialised law firms for drafting its issuance
programmes.
Essential characteristics of the Programme and the Notes and risks associated with the Notes
The Programme and the Notes
Description:
Debt Issuance Programme
Programme Size:
Up to euro 75,000,000,000 aggregate principal amount of Notes outstanding at any
one time (or the equivalent in other currencies calculated as set out below). The
euro equivalent of the aggregate principal amount of Notes outstanding at any one
time and denominated in a currency other than euro (which, in the case of Dual
Currency Notes, shall be the currency in which the subscription moneys are
received by the Issuer) shall be determined on the basis of the official rate of
exchange published by the European Central Bank of euro for the relevant currency
at any time selected by the Issuer during the five-day period ending on the date of
agreement to issue such Notes.
Dealers:
There are no Dealers appointed permanently in respect of the Programme. The
Issuer may from time to time appoint one or more dealers in respect of any Tranches
of Notes. References in this Base Prospectus to "Dealers" are to all persons
appointed as a dealer in respect of any Tranches.
Only credit institutions and investment firms incorporated in a member state of the
European Union and which are authorised to lead-manage bond issues in such
member state may act as Dealers in respect of non-syndicated issues of Notes
denominated in euro and as lead manager of syndicated issues of Notes denominated
in euro.
Method of Issue:
The Notes will be issued on a syndicated or non-syndicated basis. The Notes will be
issued in series (each a "Series") having one or more issue dates and on terms
otherwise identical (or identical other than in respect of the first payment of
interest), the Notes of each Series being intended to be interchangeable with all other
Notes of that Series. Each Series may be issued in tranches (each a "Tranche") on
the same or different issue dates with no minimum issue size. The specific terms of
each Tranche (which will be supplemented, where necessary, with supplemental
terms and conditions and, save in respect of the issue date, issue price, first payment
of interest and nominal amount of the Tranche, will be identical to the terms of other
Tranches of the same Series) will be set out in the final terms to this Base
Prospectus (the "Final Terms").
Form of Notes:
Notes may be issued as Dematerialised Notes or Materialised Notes.
Dematerialised Notes will at all times be in book entry form in compliance with
Article L.211-3 of the Code monétaire et financier.
Dematerialised Notes may, at the option of the Issuer, be issued either (i) in bearer
dematerialised form (au porteur) inscribed as from the issue date in the books of
Euroclear France which shall credit the accounts of Account Holders including
Euroclear Bank S.A./N.V., as operator of the Euroclear System ("Euroclear") and
the depository bank for Clearstream Banking, société anonyme ("Clearstream
Luxembourg") or (ii) in registered dematerialised form (au nominatif) and, in such
case, at the option of the relevant Noteholder, in either au nominatif pur or au
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nominatif administré form. No physical documents of title will be issued in respect
of Dematerialised Notes.
Materialised Notes will be in bearer materialised form only. A Temporary Global
Certificate will be issued initially in respect of each Tranche of Materialised Notes.
Such Temporary Global Certificate will be exchanged for Definitive Materialised
Notes with, where applicable, coupons for interest attached on a date expected to be
on or after the 40th day after the issue date of the Notes (subject to postponement)
upon certification as to non-US beneficial ownership as more fully described herein.

Temporary Global Certificates will (a) in the case of a Tranche intended to be
cleared through Euroclear and/or Clearstream, Luxembourg, be deposited on the
issue date with a common depositary on behalf of Euroclear and/or Clearstream,
Luxembourg and (b) in the case of a Tranche intended to be cleared through a
clearing system other than or in addition to Euroclear and/or Clearstream,
Luxembourg or delivered outside a clearing system, be deposited as agreed between
the Issuer and the relevant Dealer. Materialised Notes may only be issued outside
France.
Indexation
The Notes may be linked to any Fixed or Floating Rate, any Index, Commodity
price, or formula or any structure which itself contain Fixed or Floating Rate,
Index, Commodity price or any formula.
Clearing Systems:
Euroclear France as central depositary in relation to Dematerialised Notes and, in
relation to Materialised Notes, Clearstream, Luxembourg and Euroclear or any
other clearing system that may be agreed between the Issuer, the Fiscal Agent and
the relevant Dealer.
Currencies:
Subject to compliance with all relevant laws, regulations and directives, Notes may
be issued, without limitation, in Australian dollars, Canadian dollars, Danish krone,
euro, Hong Kong dollars, Japanese yen, New Zealand dollars, Norwegian krone,
pounds sterling, South African rand, Swedish krone, Swiss francs, U.S. dollars and
in any other currency as may be agreed between the Issuer and the relevant Dealers.
Denomination:
Definitive Notes will be in such denominations as may be agreed between the Issuer
and the relevant Dealer and specified in the relevant Final Terms, to the extent
permitted by then current laws, regulations and directives.
Status of Notes:
The Notes will constitute direct, unconditional, unsubordinated and unsecured
obligations of the Issuer and will rank pari passu among themselves all as described
in "Terms and Conditions of the Notes Status".
Negative Pledge:
The terms and conditions of the Notes will contain a negative pledge provision as
described in "Terms and Conditions of the Notes Negative Pledge".
Cross-Default:
The terms and conditions of the Notes will not contain a cross-default provision.
Ratings:
Notes issued under the Programme have, at the request of the Issuer, been rated Aaa
and P-1 by Moody's Investors Service, AAA and A-1+ by Standard & Poor's
Ratings Services, a Division of the McGraw Hill Companies, Inc. and AAA and
F1+ by Fitch Ratings in respect of the Issuer's long-term and short-term debt,
respectively. Tranches of Notes (as defined in "Summary of the Programme") issued
under the Programme may be rated or unrated. Where a Tranche of Notes is rated,
such rating will not necessarily be the same as the ratings assigned to the Notes. A
security rating is not a recommendation to buy, sell or hold securities and may be
subject to suspension, reduction or withdrawal at any time by the assigning rating
agency. Furthermore, the Issuer may at any time reduce the number of rating
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agencies from which it requests ratings.
Withholding Tax:
1. All payments of principal and interest by or on behalf of the Issuer in respect of
the Notes shall be made free and clear of, and without withholding or deduction for,
any taxes, duties, assessments or governmental charges of whatever nature imposed,
levied, collected, withheld or assessed by or within France or any authority therein
or thereof having power to tax, unless such withholding or deduction is required by
law.
2. Notes issued on or after 1 March 2010 (except Notes that are issued on or after 1
March 2010 and which are to be assimilated (assimilées) and form a single Series
with Notes issued before 1 March 2010 having the benefit of Article 131 quater of
the French General Tax Code (the "French General Tax Code")) fall under the
new French withholding tax regime pursuant to the French loi de finances
rectificative pour 2009 no. 3 (n°2009-1674 dated 30 December 2009), applicable as
from 1 March 2010 (the "Law"). Payments of interest and other revenues made by
the Issuer on such Notes will not be subject to the withholding tax set out under
Article 125 A III of the French General Tax Code unless such payments are made
outside France in a noncooperative State or territory (Etat ou territoire non
coopératif) within the meaning of Article 238-0 A of the French General Tax Code
(a "Non-Cooperative State"). If such payments under the Notes are made in a Non-
Cooperative State, a 50% withholding tax will be applicable (subject to certain
exceptions described below and the more favourable provisions of any applicable
double tax treaty) by virtue of Article 125 A III of the French General Tax Code.
Furthermore, interest and other revenues on such Notes will no longer be deductible
from the Issuer's taxable income, as from the fiscal years starting on or after 1
January 2011, if they are paid or accrued to persons established in a Non-
Cooperative State or paid in such a Non-Cooperative State. Under certain
conditions, any such non-deductible interest and other revenues may be
recharacterised as constructive dividends pursuant to Article 109 of the French
General Tax Code, in which case such non-deductible interest and other revenues
may be subject to the withholding tax set out under Article 119 bis of the French
General Tax Code, at a rate of 25% or 50%.
Notwithstanding the foregoing, the Law provides that neither the 50% withholding
tax nor the non-deductibility will apply in respect of a particular issue of Notes if the
Issuer can prove that the principal purpose and effect of such issue of Notes was not
that of allowing the payments of interest or other revenues to be made in a Non-
Cooperative State (the "Exception"). Pursuant to the ruling (rescrit) No. 2010/11
(FP et FE) of the Direction générale des impôts published on 22 February 2010, an
issue of Notes will benefit from the Exception without the Issuer having to provide
any proof of the purpose and effect of such issue of Notes, if such Notes are:
(i) offered by means of a public offer within the meaning of Article L.411-1 of the
French Code monétaire et financier or pursuant to an equivalent offer in a State
other than a Non-Cooperative State. For this purpose, an "equivalent offer" means
any offer requiring the registration or submission of an offer document by or with a
foreign securities market authority; or
(ii) admitted to trading on a regulated market or on a French or foreign multilateral
securities trading system provided that such market or system is not located in a
Non-Cooperative State, and the operation of such market is carried out by a market
operator or an investment services provider, or by such other similar foreign entity,
provided further that such market operator, investment services provider or entity is
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