Bond Bertelsman 2.625% ( XS0811690550 ) in EUR

Bertelsman

100 % ▼

Germany

XS0811690550 ( in EUR )

2.625% per year ( payment 1 time a year)

02/08/2022 - Bond has expired

Prospectus brochure of the bond Bertelsmann XS0811690550 in EUR 2.625%, expired

100 000 EUR

750 000 000 EUR

Bertelsmann is a German multinational media, services, and education company with a diversified portfolio including book publishing, magazine publishing, television production, and education.

The Bond issued by Bertelsman ( Germany ) , in EUR, with the ISIN code XS0811690550, pays a coupon of 2.625% per year.
The coupons are paid 1 time per year and the Bond maturity is 02/08/2022

Debt Issuance Programme Prospectus 4 April 2012
This document constitutes the base prospectus for the purpose of 5.4 of Directive 2003/71/EC (the "Prospectus
Directive") of Bertelsmann AG in respect of non-equity securities within the meaning of Art. 22 No. 6 (4) of the
Commission Regulation (EC) No. 809/2004 of 29 April 2004 ("Non-Equity Securities") (the "Debt Issuance
Programme Prospectus" or the "Prospectus").

Bertelsmann AG
(Gütersloh, Federal Republic of Germany)
as Issuer
EUR 4,000,000,000
Debt Issuance Programme
(the "Programme")
Application has been made to the Luxembourg Commission de Surveillance du Secteur Financier (the
"Commission"), which is the Luxembourg competent authority for the purpose of the Prospectus Directive, for
its approval of this Prospectus.
Application has been made to list Notes to be issued under the Programme on the official list of the Luxembourg
Stock Exchange and to trade Notes on the regulated market "Bourse de Luxembourg". The Luxembourg Stock
Exchange's regulated market is a regulated market for the purposes of the Markets in Financial Instruments
Directive 2004/39/EC (the "Regulated Market"). Notes issued under the Programme may also be listed on an
alternative stock exchange or may not be listed at all.
The Issuer has requested the Commission in its capacity as competent authority under the Luxembourg act
relating to prospectuses for securities (Loi relative aux prospectus pour valeurs mobilières) which implements
the Prospectus Directive into Luxembourg law to provide the competent authorities in the Federal Republic of
Germany, the Republic of Austria, the United Kingdom of Great Britain and Northern Ireland, the Republic of
Ireland and the Netherlands with a certificate of approval attesting that the Prospectus has been drawn up in
accordance with the Loi relative aux prospectus pour valeurs mobilières ("Notification"). The Issuer may
request the Commission to provide competent authorities in additional Member States within the European
Economic Area with a Notification. By approving a prospectus, the CSSF shall give no undertaking as to the
economic and financial soundness of the operation or the quality or solvency of the issuer.
The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended
(the "Securities Act") and may not be offered or sold within the United States except pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the Securities Act.

Arranger
Deutsche Bank

Dealers
Barclays
BNP PARIBAS
BofA Merrill Lynch
Citigroup
Commerzbank
Deutsche Bank
Société Générale Corporate
J.P. Morgan
& Investment Banking
The Royal Bank of Scotland

This Prospectus will be published in electronic form on the website of the Luxembourg Stock Exchange
(www.bourse.lu) and on the website of Bertelsmann AG (www.bertelsmann.de). This Prospectus is valid for a
period of twelve months from its date of publication. It replaces the Prospectus dated 8 April 2011.

RESPONSIBILITY STATEMENT
Bertelsmann AG ("Bertelsmann AG" or the "Issuer" together with its consolidated group companies, the
"Bertelsmann Group" or "Bertelsmann") with its registered office in Gütersloh, Germany accepts
responsibility for the information given in this Prospectus including the documents incorporated by
reference herein.
The Issuer hereby declares that, having taken all reasonable care to ensure that such is the case, the
information contained in this Prospectus for which it is responsible is, to the best of its knowledge and
belief, in accordance with the facts and contains no omission likely to affect its import.
NOTICE
This Prospectus should be read and understood in conjunction with any supplement hereto and with any
other documents incorporated herein by reference. Full information on the Issuer and any tranche of Notes
is only available on the basis of the combination of the Prospectus and the relevant Final Terms (as
defined herein).
The Dealers (as defined herein) have not independently verified the information contained herein.
Accordingly, no representation, warranty or undertaking, express or implied, is made and no responsibility
or liability is accepted by the Dealers as to the accuracy or completeness of the information contained in
this Prospectus or any other information provided by the Issuer in connection with the Programme or the
Notes or their distribution. No Dealer accepts any liability in relation to the information contained or
incorporated by reference in this Prospectus or any information provided by the Issuer in connection with
the Programme or the Notes. The Dealers expressly do not undertake to review the financial condition or
affairs of the Issuer during the life of the Programme or to advise any investor in the Notes of any
information coming to their attention.
The Issuer has confirmed to the Dealers that this Prospectus contains all information which 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 and the rights attaching to the Notes which is material in the context of
the Programme; that the information contained herein with respect to the Issuer and the Notes is accurate
and complete in all material respects and is not misleading; that any opinions and intentions expressed
herein are honestly held and based on reasonable assumptions; that there are no other facts with respect
to the Issuer or the Notes, the omission of which would make this Prospectus as a whole or any of such
information or the expression of any such opinions or intentions misleading; that the Issuer has made all
reasonable enquiries to ascertain all facts material for the purposes aforesaid.
The Issuer has undertaken with the Dealers (i) to supplement this Prospectus or publish a new Prospectus
in the event of any significant new factor, material mistake or inaccuracy relating to the information
included in this Prospectus in respect of Notes issued on the basis of this Prospectus which is capable of
affecting the assessment of the Notes and which arises or is noted between the time when this Prospectus
has been approved and the final closing of any tranche of Notes offered to the public or, as the case may
be, when trading of any tranche of Notes on a regulated market begins, and (ii) where approval of the
Commission of any such document is required, to have such document approved by the Commission.
Subject as provided in the applicable Final Terms, the only persons authorised to use this Prospectus in
connection with an offer of Notes are the persons named in the applicable Final Terms as the relevant
Dealer or the Manager(s), as the case may be.
No person has been authorised to give any information which is not contained in or not consistent with this
Prospectus or any other document entered into in relation to the Programme or any information supplied
by the Issuer or any other information in the public domain and, if given or made, such information must
not be relied upon as having been authorised by the Issuer, the Dealers or any of them.
Neither the Arranger nor any Dealer nor any other person mentioned in this Prospectus, excluding the
Issuer, is responsible for the information contained in this Prospectus or any supplement hereto, or any
Final Terms or any document incorporated herein by reference, and accordingly, and to the extent
permitted by the laws of any relevant jurisdiction, none of these persons accepts any responsibility for the
accuracy and completeness of the information contained in any of these documents. This Prospectus is
valid for 12 months following its date of publication and this Prospectus and any supplement hereto as well
as any Final Terms reflect the status as of their respective dates of issue. The delivery of this Prospectus
or any Final Terms and the offering, sale or delivery of any Notes may not be taken as an implication that
the information contained in such documents is accurate and complete subsequent to their respective
dates of issue or that there has been no adverse change in the financial situation of the Issuer since such
date or that any other information supplied in connection with the Programme is accurate at any time
2

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 Prospectus and any Final Terms and the offering, sale and delivery of Notes in
certain jurisdictions may be restricted by law. Persons into whose possession this Prospectus or any Final
Terms come are required to inform themselves about and observe any such restrictions. For a description
of the restrictions applicable in the United States of America, the European Economic Area in general, the
United Kingdom, the Netherlands and Japan see "Selling Restrictions". In particular, the Notes have not
been and will not be registered under the Securities Act and are subject to tax law requirements of the
United States and may not be offered or sold within the United States except pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the Securities Act.
The language of the Prospectus is English. Any part of this Prospectus in the German language
constitutes a translation. In respect of the issue of any Tranche of Notes under the Programme, the
German text of the Terms and Conditions may be controlling and binding if so specified in the relevant
Final Terms.
This Prospectus may be used for subsequent offers by the Dealers and/or further financial intermediaries
only insofar if and for the period so specified in the Final Terms for the relevant Tranche of Notes.
This Prospectus may only be used for the purpose for which it has been published.
This Prospectus and any Final Terms may not be used for the purpose of an offer or solicitation by
anyone in any jurisdiction in which such offer or solicitation is not authorised or to any person to
whom it is unlawful to make such an offer or solicitation.
This Prospectus and any Final Terms do not constitute an offer or an invitation to subscribe for or
purchase any Notes and should not be considered as a recommendation by the Issuer, the Dealers
or any of them that any recipient of the Prospectus or any Final Terms should subscribe or
purchase any Notes. Each recipient of the Prospectus or any Final Terms shall be taken to have
made its own investigation and appraisal of the condition (financial and otherwise) of the Issuer.
In connection with the issue of any Tranche of Notes under the Programme, the Dealer or Dealers
(if any) named as Stabilising Manager(s) in the applicable Final Terms (or persons acting on behalf
of a Stabilising Manager) may over-allot Notes or effect transactions with a view to supporting the
price of the Notes at a level higher than that which might otherwise prevail. However, there is no
assurance that such Stabilising Manager(s) (or persons acting on behalf of a Stabilising Manager)
will undertake stabilisation action. Any stabilisation action may begin at any time after the
adequate public disclosure of the terms of the offer of the relevant Tranche of the Notes and, if
begun, may be ended at any time, but it must end no later than the earlier of 30 days after the Issue
Date of the relevant Tranche of Notes and 60 days after the date of the allotment of the relevant
Tranche of Notes. Any stabilisation action or over-allotment must be conducted by the relevant
Stabilising Manager(s) (or person(s) acting on behalf of any Stabilising Manager(s)) in accordance
with all applicable laws and rules.
FORWARD-LOOKING STATEMENTS
This Prospectus contains certain forward-looking statements. A forward-looking statement is a statement
that does not relate to historical facts and events. They are based on analyses or forecasts of future
results and estimates of amounts not yet determinable or foreseeable. These forward-looking statements
are identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect",
"intend", "may", "plan", "predict", "project", "will" and similar terms and phrases, including references and
assumptions. This applies, in particular, to statements in this Prospectus containing information on future
earning capacity, plans and expectations regarding Bertelsmann Group's business and management, its
growth and profitability, and general economic and regulatory conditions and other factors that affect it.
Forward-looking statements in this Prospectus are based on current estimates and assumptions that the
Issuer make to the best of their present knowledge. These forward-looking statements are subject to risks,
uncertainties and other factors which could cause actual results, including Bertelsmann Group's financial
condition and results of operations, to differ materially from and be worse than results that have expressly
or implicitly been assumed or described in these forward-looking statements. Bertelsmann Group's
business is also subject to a number of risks and uncertainties that could cause a forward-looking
statement, estimate or prediction in this Prospectus to become inaccurate. Accordingly, investors are
strongly advised to read the following sections of this Prospectus: "Summary", "Risk Factors" and "General
Information about Bertelsmann AG and Bertelsmann Group". These sections include more detailed
3

descriptions of factors that might have an impact on Bertelsmann Group's business and the markets in
which it operates.
In light of these risks, uncertainties and assumptions, future events described in this Prospectus may not
occur. In addition, neither the Issuer nor the Dealers assume any obligation, except as required by law, to
update any forward-looking statement or to conform these forward-looking statements to actual events or
developments.

4

TABLE OF CONTENTS
Page
General Description of the Programme ................................................................................................. 6
General .................................................................................................................................................. 6
Issue Procedures ................................................................................................................................... 6
Summary................................................................................................................................................ 8
Summary regarding the Notes............................................................................................................... 8
Summary regarding Risk Factors ........................................................................................................ 11
Summary regarding Bertelsmann AG and Bertelsmann Group .......................................................... 14
German Translation of the Summary................................................................................................... 17
Risk Factors ......................................................................................................................................... 27
Risk Factors regarding Bertelsmann AG and Bertelsmann Group...................................................... 27
Risk Factors regarding the Notes ........................................................................................................ 30
General Information about Bertelsmann AG and Bertelsmann Group ................................................ 34
Terms and Conditions.......................................................................................................................... 49
Description of Rules Regarding Resolutions of Holders...................................................................... 93
Form of Final Terms............................................................................................................................. 95
Use of Proceeds ................................................................................................................................ 116
Taxation ............................................................................................................................................. 117
Selling Restrictions ............................................................................................................................ 121
General Information ........................................................................................................................... 125
Interests of Natural and Legal Persons involved in the Issue/Offer .................................................. 125
Authorisation ...................................................................................................................................... 125
Post Issuance Information ................................................................................................................. 125
Listing and Admission to Trading....................................................................................................... 125
Clearing Systems............................................................................................................................... 125
Documents on Display....................................................................................................................... 125
Documents Incorporated by Reference ............................................................................................. 127
Comparative Table of Documents incorporated by Reference.......................................................... 127
Availability of Incorporated Documents ............................................................................................. 127
Names and Addresses....................................................................................................................... 129

5

GENERAL DESCRIPTION OF THE PROGRAMME
I. General
Under this Programme, Bertelsmann may from time to time issue notes (the "Notes") to one or more of the
following dealers: Barclays Bank PLC, BNP PARIBAS, Citigroup Global Markets Limited, Commerzbank
Aktiengesellschaft, Deutsche Bank Aktiengesellschaft, J.P. Morgan Securities Ltd., Merrill Lynch
International, Société Générale, The Royal Bank of Scotland plc and any additional Dealer appointed
under the Programme from time to time by the Issuer, which appointment may be for a specific issue or on
an ongoing basis (each a "Dealer", and together, the "Dealers").
Deutsche Bank acts as arranger in respect of the Programme (the "Arranger").
The maximum aggregate principal amount of the Notes outstanding at any one time under the Programme
will not exceed EUR 4,000,000,000 (or its equivalent in any other currency). The Issuer may increase the
amount of the Programme in accordance with the terms of the Dealer Agreement from time to time.
Notes may be issued on a continuing basis to one or more of the Dealers. Notes may be distributed by
way of public offer or private placements and, in each case, on a syndicated or non-syndicated basis. The
method of distribution of each tranche ("Tranche") will be stated in the relevant final terms (the "Final
Terms").
Notes will be issued in Tranches, each Tranche in itself consisting of Notes which are identical in all
respects. One or more Tranches, which are expressed to be consolidated and forming a single series and
identical in all respects, but having different issue dates, interest commencement dates, issue prices and
dates for first interest payments may form a series ("Series") of Notes. Further Notes may be issued as
part of existing Series. The specific terms of each Tranche (which will be supplemented, where necessary,
with supplemental terms and conditions) will be set forth in the applicable Final Terms.
Notes will be issued in such denominations as may be agreed between the Issuer and the relevant
Dealer(s) and as indicated in the applicable Final Terms save that the minimum denomination of the Notes
will be, if in euro, EUR 1,000, and, if in any currency other than euro, an amount in such other currency
nearly equivalent to EUR 1,000 at the time of the issue of Notes.
Notes will be issued with a maturity of twelve months or more.
Notes may be issued at an issue price which is at par or at a discount to, or premium over, par, as stated
in the relevant Final Terms.
Application has been made to the Commission, which is the Luxembourg competent authority for the
purpose of the Prospectus Directive for its approval of this Prospectus.
Application has been made to the Luxembourg Stock Exchange for Notes issued under this Prospectus to
be admitted to trading on the Regulated Market of the Luxembourg Stock Exchange and to be listed on the
official list of the Luxembourg Stock Exchange. The Programme provides that Notes may be listed on
other or further stock exchanges, as may be agreed between the Issuer and the relevant Dealer(s) in
relation to each issue. Notes may further be issued under the Programme which will not be listed on any
stock exchange.
Notes will be accepted for clearing through one or more Clearing Systems as specified in the applicable
Final Terms. These systems will include those operated by Clearstream Banking AG, Clearstream
Banking, société anonyme and Euroclear Bank SA/NV.
Deutsche Bank Luxembourg S. A. will act as Luxembourg Listing Agent (the "Listing Agent") and
Deutsche Bank Aktiengesellschaft will act as fiscal agent (the "Fiscal Agent").
Deutsche Bank Luxembourg S. A. and other institutions, all as indicated in the applicable Final Terms, will
act as paying agents (the "Paying Agents") under the Programme.
II. Issue Procedures
General
The Issuer and the relevant Dealer(s) will agree on the terms and conditions applicable to each particular
Tranche of Notes (the "Conditions"). The Conditions will be constituted by the terms and conditions of the
Notes set forth below (the "Terms and Conditions") as completed, modified, supplemented or replaced
6

by the provisions of the Final Terms (the "Final Terms"). The Final Terms relating to each Tranche of
Notes will specify:
whether the Conditions are to be Long-Form Conditions or Integrated Conditions (each as
described below); and
whether the Conditions will be in the German language or the English language or both (and, if both,
whether the German language version or the English language version is controlling).
As to whether the Conditions are documented as Long-Form Conditions or Integrated Conditions, the
following applies:
Integrated Conditions will be required where the Notes are to be publicly offered, in whole or in part,
or are to be initially distributed, in whole or in part, to non-qualified investors.
In all other cases the Issuer may elect to use Long-Form Conditions or Integrated Conditions.
As to the controlling language of the respective Conditions, the Issuer anticipates that, in general, subject
to any stock exchange or legal requirements applicable from time to time, and unless otherwise agreed
between the Issuer and the relevant Dealer,

in the case of Notes publicly offered, in whole or in part, in the Federal Republic of Germany
("Germany"), or distributed, in whole or in part, to non-qualified investors in Germany, German will be
the controlling language. If, in the event of such public offer or distribution to non-qualified investors,
however, English is chosen as the controlling language, a German language translation of the
Conditions will be available from the principal offices of the Fiscal Agent and Bertelsmann AG, as
specified on the back cover of this Prospectus.
Long-Form Conditions
If the Final Terms specify that Long-Form Conditions are to apply to the Notes, the provisions of the
applicable Final Terms and the Terms and Conditions, taken together, shall constitute the Conditions.
Such Conditions will be constituted as follows:
the blanks in the provisions of the Terms and Conditions which are applicable to the Notes will be
deemed to be completed by the information contained in the Final Terms as if such information were
inserted in the blanks of such provisions;
the Terms and Conditions will be modified, supplemented or replaced by the text of any provisions of
the Final Terms modifying, supplementing or replacing, in whole or in part, the provisions of the Terms
and Conditions;
alternative or optional provisions of the Terms and Conditions as to which the corresponding provisions
of the Final Terms are not completed or are deleted will be deemed to be deleted from the Conditions;
and
all instructions and explanatory notes set out in square brackets in the Terms and Conditions and any
footnotes and explanatory text in the Final Terms will be deemed to be deleted from the Conditions.
Where Long-Form Conditions apply, each global note representing the Notes of the relevant Series will
have the Final Terms and the Terms and Conditions attached.
Integrated Conditions
If the Final Terms specify that Integrated Conditions are to apply to the Notes, the Conditions in respect
of such Notes will be constituted as follows:
all of the blanks in all applicable provisions of the Terms and Conditions will be completed according to
the information contained in the Final Terms and all non-applicable provisions of the Terms and
Conditions (including the instructions and explanatory notes set out in square brackets) will be deleted;
and/or
the Terms and Conditions will be otherwise modified, supplemented or replaced, in whole or in part,
according to the information set forth in the Final Terms.
Where Integrated Conditions apply, the Integrated Conditions alone will constitute the Conditions. The
Integrated Conditions will be attached to each global note representing Notes of the relevant Series.

7

SUMMARY
The following constitutes the summary (the "Summary") of the essential characteristics and risks
associated with the Issuer and the Notes to be issued under the Programme. This Summary should be
read as an introduction to this Prospectus. Any decision by an investor to invest in any Tranche of Notes
should be based on consideration of this Prospectus as a whole, including any supplement thereto, the
documents incorporated by reference and the relevant Final Terms. Where a claim relating to the
information contained in this Prospectus, any supplements thereto, the documents incorporated by
reference and the relevant Final Terms is brought before a court, the plaintiff investor might, under the
national legislation of such court, have to bear the costs of translating the Prospectus, any supplement
thereto, the documents incorporated by reference and the relevant Final Terms before the legal
proceedings are initiated. Civil liability attaches to the Issuer which has tabled this Summary including any
translation thereof, and applied for its notification, but only if this Summary is misleading, inaccurate or
inconsistent when read together with the other parts of this Prospectus.
The following Summary does not purport to be complete and is taken from and qualified in its entirety by
the remainder of this Prospectus and, in relation to the terms and conditions of any particular Tranche of
Notes, the applicable Final Terms.
SUMMARY REGARDING THE NOTES
Issuer
Bertelsmann AG
Arranger
Deutsche Bank Aktiengesellschaft
Dealers
Barclays Bank PLC, BNP PARIBAS, Citigroup Global Markets Limited,
Commerzbank Aktiengesellschaft, Deutsche Bank Aktiengesellschaft, J.P.
Morgan Securities Ltd., Merrill Lynch International, Société Générale, The
Royal Bank of Scotland plc
Fiscal Agent
Deutsche Bank Aktiengesellschaft
Paying Agents
Deutsche Bank Luxembourg S.A. and other institutions, all as indicated in
the applicable Final Terms.
Listing Agent
Deutsche Bank Luxembourg S.A.
Specified Currencies
Subject to any applicable legal or regulatory restrictions, and requirements
of relevant central banks, Notes may be issued in euro or any other currency
agreed by the Issuer and the relevant Dealer(s).
Denominations of Notes Notes will be issued in such denominations as may be agreed between the
Issuer and the relevant Dealer(s) and as indicated in the applicable Final

Terms save that the minimum denomination of the Notes will be, if in euro,
EUR 1,000, and, if in any currency other than euro, an amount in such other
currency nearly equivalent to EUR 1,000 at the time of the issue of the
Notes.
Maturities
Notes will have such maturities of twelve months or more as may be
agreed between the Issuer and the relevant Dealer(s) and as indicated in
the applicable Final Terms, subject to such minimum or maximum maturities
as may be allowed or required from time to time by the relevant central bank
(or equivalent body) or any laws or regulations applicable to the Issuer or
the relevant Specified Currency.
Form of Notes
Notes will be issued in bearer form only.
Types of Notes
Notes may be either interest bearing at fixed or variable rates or non-interest
bearing, with principal repayable at a fixed amount or by reference to a

formula as may be agreed between the Issuer and the relevant Dealer(s) as
specified in the applicable Final Terms.
Fixed Rate Notes
Fixed Rate Notes bear a fixed interest income throughout the entire term of
the Notes. Fixed interest will be payable on such basis as may be agreed

between the Issuer and the relevant Dealer(s), as specified in the applicable
Final Terms.
8

Floating Rate Notes
Floating Rate Notes will bear interest at a rate determined (and as adjusted
for any applicable margin):

on the same basis as the floating rate under a notional interest rate
swap transaction in the relevant specified currency governed by an
agreement incorporating either the 2000 ISDA Definitions or the 2006
ISDA Definitions (each as published by the International Swaps and
Derivatives Association, Inc., and each as amended and updated as at
the date on which the first tranche of the Notes of the relevant Series is
issued),

on the basis of a reference rate appearing on the agreed screen page
of a commercial quotation service, or

on such other basis as indicated in the applicable Final Terms.
The margin (if any) relating to such floating rate will be indicated in the
applicable Final Terms for each Series of Floating Rate Notes.
Interest periods for Floating Rate Notes will be one, two, three, six or twelve
months or such other period(s) as may be agreed between the Issuer and
the relevant Dealer(s) (as specified in the applicable Final Terms).
Structured Floating Rate Floating Rate Notes may include multipliers or other leverage factors, or
Notes
caps or floors, or any combination of those features or other similar related
features.

Inverse Floating Rate
Inverse Floating Rate Notes (also called Reverse Floating Rate Notes) have
Notes
an interest rate which is determined as the difference between a fixed
interest rate and a floating rate reference rate such as the Euro Interbank

Offered Rate (EURIBOR) or the London Interbank Offered Rate (LIBOR).
Fixed to Floating Rate
Fixed to Floating Rate Notes may bear interest at a rate that the Issuer may
Notes
elect to convert from a fixed rate to a floating rate, or from a floating rate to a
fixed rate.

Instalment Notes
Instalment Notes are Notes, where payment of principal is made in
instalments. Instalment will be made as the Issuer and the relevant

Dealer(s) may agree (as indicated in the applicable Final Terms).
Index Linked Notes
Index Linked Notes may be issued as Index Linked Interest Notes or Index
Linked Redemption Notes or a combination of both.

Index Linked Interest
Payments of interest in respect of Index Linked Interest Notes will be made
Notes
by reference to a single index or other factors (including changes in the price
of securities and commodities or movements in exchange rates) and/or such

formula as may be specified by the Issuer and the relevant Dealer (as
indicated in the applicable Final Terms).
Index Linked
Payments of principal in respect of Index Linked Redemption Notes will be
Redemption Notes
calculated by reference to a single index or other factors (including changes
in the price of securities and commodities or movements in exchange rates)

and/or such formula as may be specified by the Issuer and the relevant
Dealer(s) (as indicated in the applicable Final Terms). Each principal
amount of Notes equal to the lowest specified denomination specified in the
applicable Final Terms will be redeemed by payment of the redemption
amount specified in or as determined pursuant to provisions in the
applicable Final Terms.
Other provisions in
Floating Rate Notes and Index Linked Interest Notes may also have a
relation to Floating Rate
maximum interest rate, a minimum interest rate or both.
Notes and Index Linked
Interest Notes
Interest on Floating Rate Notes and Index Linked Interest Notes in respect
of each Interest Period, as selected prior to issue by the Issuer and the

relevant Dealer(s), will be payable on such Interest Payment Dates specified
in, or determined pursuant to, the applicable Final Terms and will be
calculated as specified in the applicable Final Terms.
9

Dual Currency Notes
Dual Currency Notes are Notes, where payment of principal and payment of
interest can be made in different currencies. Payments (whether in respect

of principal or interest and whether at maturity or otherwise) in respect of
Dual Currency Notes will be made in such currencies, and based on such
rates of exchange, as the Issuer and the relevant Dealer(s) may agree, (as
indicated in the applicable Final Terms).
Zero Coupon Notes
Zero Coupon Notes will be offered and sold either at a discount to their
principal amounts or on an accumulated basis, in each case without periodic

payments of interest.
Other Notes
Except for equity linked Notes, Notes may be of any other type of Non-
Equity Security or may have any other structure, all upon terms provided in

the applicable Final Terms.
Redemption
The applicable Final Terms will indicate either that the Notes cannot be
redeemed prior to their stated maturity (except for taxation reasons or upon
the occurrence of an Event of Default) or that such Notes will be redeemable
at the option of the Issuer and/or the Holders upon giving notice within the
notice period (if any) specified in the applicable Final Terms to the Holders
or the Issuer, as the case may be, on a date or dates specified prior to such
stated maturity and at a price or prices and on such terms as indicated in the
applicable Final Terms.
Taxation
Principal and interest shall be payable without withholding or deduction for
or on account of any present or future taxes, duties of whatever nature
imposed, levied or collected by or on behalf of the Federal Republic of
Germany or by or on behalf of any political subdivision or authority thereof or
therein having power to tax (the "Withholding Taxes"), unless such
withholding or deduction is required by law. In such event, the Issuer will,
subject to the exceptions set out in the Terms and Conditions, pay such
additional amounts as shall be necessary in order that the net amounts
received by the Holders of the Notes after such withholding or deduction
shall equal the respective amounts of principal and interest which would
otherwise have been receivable in respect of the Notes in the absence of
such withholding or deduction.
Early Redemption for
Early Redemption of the Notes for reasons of taxation will be permitted, if as
Taxation Reasons
a result of any change in, or amendment to the laws or regulations (including
any amendment to, or change in, an official interpretation or application of

such laws or regulations), of the Federal Republic of Germany or any
political subdivision or taxing authority thereto or therein affecting taxation or
the obligation to pay duties of any kind, the Issuer will become obligated to
pay additional amounts on the Notes, all as more fully set out in the Terms
and Conditions.
Status of the Notes
The Notes will constitute unsecured and unsubordinated obligations of the
Issuer ranking pari passu among themselves and pari passu with all other
unsecured and unsubordinated obligations of the Issuer, unless such
obligations are accorded priority under mandatory provisions of statutory
law.
Negative Pledge
The Notes will contain a negative pledge provision as further described in
the Terms and Conditions.

Events of Default
The Notes will provide for events of default entitling Holders to demand
immediate redemption of the Notes, all as fully set out in the Terms and

Conditions.
Cross Default
The Notes will provide for a cross default as fully set out in the Terms and
Conditions.

Change of Control-
The Terms and Conditions will provide for a change of control as fully set
Clause
out in the Terms and Conditions.
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