[The following table sets forth the maturity breakdown of Hungary's medium and long-term external debt by sectors (excluding SPEs) as of 31 December 2020: Table 57: Schedule of Payments on External Public Debt as of 31 December 2020
__________________]
 General Government  Other sectors


__________________
Source: NBH
The following table sets forth the aggregate amount of international debt issuances of Hungary for the periods indicated:
Table 58: International Debt Issuance
[Table 58: International Debt Issuance
__________________]

 2018 2019 2020

"":""
"For the year ended 31 December":"(EUR millions)"

International Debt Issuance .................. 1,483 0 6,498
__________________
Source: GDMA Pte Ltd.
(c) National Debt Issuances


On 27 July 2017, Hungary issued a CNY1,000,000,000 bond under Chinese law maturing in July 2020.
On 10 October 2017, Hungary issued a EUR1,000,000,000 bond maturing in October 2027 to finance the repurchase of its certain USD denominated debt as announced in a tender offer on 26 September 2017.
On 22 March 2018, Hungary issued a JPY30,000,000,000 bond under Japanese law maturing in March 2021.
On 19 December 2018, Hungary issued a CNY2,000,000,000 bond under Chinese law maturing in December 2021.


On 23 April 2020, the Government announced the issuance of euro-denominated bonds in the amount
of EUR2 billion. The two-tranche transaction consisted of the issuance of a six-year bond in the amount of EUR1 billion, and the issuance of a 12-year bond in the amount of EUR1 billion. The settlement took place on 28 April 2020.


On 2 June 2020, the Hungary announced the issuance of its inaugural euro-denominated green bond in the amount of EUR1.5 billion. The green bond was issued under Hungary’s Green Bond Framework published in May 2020. The settlement took place on 5 June 2020.


On 11 September 2020, the Government announced the issuance of Japanese yen denominated bonds in the amount of JPY62.7 billion. The four-tranche transaction consisted of the issuance of a 3-year Samurai bond in the amount of JPY22.7 billion, the issuance of a 5-year Samurai bond in the amount of JPY20.0 billion, and Hungary’s first and second Green Samurai bonds in the amounts of JPY15.5 billion and JPY4.5 billion and with maturities of 7 and 10 years, respectively.


The settlement of the bonds took place on 18 September 2020. Hungary became the first sovereign to issue green bonds in the domestic capital market of Japan.
On 17 November 2020, the Government issued Euro denominated bonds in the amount of EUR2.5 billion. The two-tranche transaction consisted of the issuance of a bond series maturing in 2030 in the amount of EUR1.25 billion, and a bond series maturing in 2050 in the amount of EUR1.25 billion. The settlement took place on 17 November 2020.


The debut issuance of the first Hungarian local currency denominated green government bond took place in April 2021. The maturity of the green bond is 30 years and the bid-to-cover rate exceeded 7 on the first auction. Subsequently, the second auction of the green bond took place in July. Beginning with the 2021 reserve period, the central bank decided to fully or partially cancel the capital requirement for certain green investments.


On 13 September 2021, the Government announced the issuance of dual currency (EUR and USD) and multi tranche bonds in the total amount of up to EUR4.5 billion. Finally, the triple-tranche transaction consisted of the issuance of a 10-year and a 30-year bonds in the amount of USD2.25 billion and USD2 billion respectively, and the issuance of a 7-year bond in the amount of EUR1 billion. The settlement took place on 21 September 2021.
(d) Internal Public Debt


Total internal short-term debt with an original maturity of one year or less consists of Interest-bearing T-bills with half and one year maturity, Treasury Savings Bills with one year maturity and Discount T-bills. The outstanding amount of Interest-bearing T-bills, Treasury Savings Bills with one year maturity and Discount T-bills was HUF1,008.3 billion, HUF212.6 billion and HUF658.2 billion, respectively as of 31 December 2020.


As of 31 December 2020, Hungary’s total internal public debt, including the social security and extra-budgetary funds, was HUF29,237.3 billion. As of 31 December 2020, almost all of the Government’s internal debt represented government securities (with 4.0% of the Government’s internal debt consisting of loans from EIB and CEB).


Within the total HUF-denominated government debt, publicly issued government securities have been playing a predominant role. Raising public funds on the domestic market depends to a large degree upon the issuance of government bonds. Of the total amount of outstanding publicly issued HUF-denominated government securities, government bonds accounted for 64.9% as of 31 December 2020.


Hungary’s policy is to finance budget deficits primarily with internal debt and partly by accessing the international markets. The type of financing is determined based on a benchmark for the debt portfolio composition. The average maturity of internal debt was 3.56 years at the end of 2018, 4.15 years at the end of 2019 and 4.69 years at the end of 2020.


On 31 August 2017, the Government announced that the state would partially assume the mortgage debt of families who have at least three children beginning 1 January 2018. The assumed debt would be a maximum of HUF1 million per family. According to the estimate of the MNE, the budgetary effect of the mortgage debt-assumption measure was expected to range between HUF10 billion and
HUF20 billion annually.


The Government has also guaranteed certain Hungarian indebtedness. As of 31 December 2020, these guarantees totaled EUR14.4 billion. According to GFS methodology, guarantees are not included in the governmental debt and only affect the central governmental deficit if and when the Government is obligated to make a payment under the guarantee.
(e) Government Obligations to the NBH


The following table shows the Government’s obligations to the NBH, as of December 31 for the years indicated and as of 31 August 2021:
Table 59: Government Obligations to the NBH
[Table 59: Government Obligations to the NBH
__________________ Source: NBH]

 2018 2019 2020 2021

  (HUF billions)

Total ................... 39.2 39.2 1,113.6 3,057.0
__________________ Source: NBH
(2) Gross External Debt


The following table sets forth the distribution and maturity of gross external debt of Hungary as of 31 December 2020:
Table 60: Gross External Debt (1)
[Table 60: Gross External Debt (1)
__________________]
 Amount of Debt %Medium and Long
 (EUR millions) (%)
Obligor


(2) External debt as defined in External Debt Statistics: Guide for Compilers and Users (IMF 2003). Financial derivatives are not included.
(3) Direct investment debt liabilities included.
Table 61: Selected Annual Debt Service Indicators of Hungary (BOP basis excluding SPEs)
[Table 61: Selected Annual Debt Service Indicators of Hungary (BOP basis excluding SPEs)
-o/w: General government and Central	15.3	13.6	19.6


Net external debt (excl. direct investment debt instruments)/GDP ................................	8.8	7.8	8.2


Net external debt denominated in foreign currencies (excl. direct investment debt instruments)/GDP ........................................	-5.9	-6.2	-6.4


Net external debt (incl. direct investment debt instruments)/GDP ................................	9.3	7.1	10.0
2. Debt service indicators


Total Debt Service denominated in foreign currencies (TDS) (excl. direct investment	9.6	7.7	10.1


debt instruments (2) /GDP............................... Total Debt Service denominated in foreign	11.5	9.5	12.6


debt instruments (2) /XGS............................... Gross interest expenditures (excl. direct	0.9	0.8	0.7


investment debt instruments) /GDP............. Net interest expenditures (excl. direct	0.5	0.4	0.3
investment debt instruments) /GDP............. Memoradum:


[	2018	2019	2020
1. Debt indicator (1)
Gross debt indicators
Gross external debt (excl. direct investment	55.4	52.1	59.0
debt instruments)/GDP ................................ -o/w: General government and Central bank (S.13+S.121) .................................	28.7	26.7	34.4
Gross external debt denominated in foreign currencies (excl. direct investment debt instruments)/GDP ........................................	38.0	35.1	41.3
__________________]


"-o/w: General government and Central":"Net external debt (excl. direct investment debt instruments)/GDP ................................"
"15.3":"8.8"
"13.6":"7.8"
"19.6":"8.2"


"-o/w: General government and Central":"Net external debt denominated in foreign currencies (excl. direct investment debt instruments)/GDP ........................................"
"15.3":"-5.9"
"13.6":"-6.2"
"19.6":"-6.4"


"-o/w: General government and Central":"Net external debt (incl. direct investment debt instruments)/GDP ................................"
"15.3":"9.3"
"13.6":"7.1"
"19.6":"10.0"


"-o/w: General government and Central":"2. Debt service indicators"
"15.3":""
"13.6":""
"19.6":""


"-o/w: General government and Central":"Total Debt Service denominated in foreign currencies (TDS) (excl. direct investment"
"15.3":"9.6"
"13.6":"7.7"
"19.6":"10.1"


"-o/w: General government and Central":"debt instruments (2) /GDP............................... Total Debt Service denominated in foreign"
"15.3":"11.5"
"13.6":"9.5"
"19.6":"12.6"


"-o/w: General government and Central":"debt instruments (2) /XGS............................... Gross interest expenditures (excl. direct"
"15.3":"0.9"
"13.6":"0.8"
"19.6":"0.7"


"-o/w: General government and Central":"investment debt instruments) /GDP............. Net interest expenditures (excl. direct"
"15.3":"0.5"
"13.6":"0.4"
"19.6":"0.3"
investment debt instruments) /GDP............. Memoradum:


"-o/w: General government and Central":"Net external financing capacity (CA and"
"15.3":"2.4"
"13.6":"1.2"
"19.6":"0.4"


"-o/w: General government and Central":"International reserves (RES) (Euro millions)"
"15.3":"27,403"
"13.6":"28,385"
"19.6":"33,677"
__________________
Source: NBH
Notes:
(1) External debt as defined in External Debt Statistics: Guide for Compilers and Users: equity and financial derivative instruments are excluded.
(2) (TDS) Long-term debt amortisation and gross interest expenditures.
(3) Data of CSO. (Updated on 20 September 2021).
6. Tables and Supplementary Information


Table 62: NBH External Funded Convertible Currency Debt: USD Debt (as of 31 December 2020)
[Table 62: NBH External Funded Convertible Currency Debt: USD Debt (as of 31 December 2020)
EUR/USD ....................................	5.75	2015		2023	—	(500,000,00


[	Interest Rate	Year	Original Amount Contracted	Principal Amount Outstanding
	(%)	Issue	Maturity(1)	(Credit)/Debit


					USD
A. NATIONAL BANK OF
HUNGARY
1. U.S. Dollar Debt
a. Swap Arrangements


__________________ Source: NBH
Table 64: Hungary External Funded Convertible Currency Debt: USD Debt (as of 31 December 2020)
[Table 64: Hungary External Funded Convertible Currency Debt: USD Debt (as of 31 December 2020)
USD/EUR..................	5.75	2013	2023	USD	(1,000,000,000)	USD	(1,00


[	Interest Rate	Year	Original Amount	Principal Amount Outstanding
	(%)	Issue	Maturity		Contracted	(Credit)/Debit


Total ..........................						USD	(8,182,402,000)
Total U.S. Dollar Debt						USD	24,000,000.00
__________________
Source: GDMA Pte Ltd.
Table 65: Hungary External Funded Convertible Currency Debt: EUR Debt (EIB & Bonds) (as of 31 December 2020)


[Table 65: Hungary External Funded Convertible Currency Debt: EUR Debt (EIB & Bonds) (as of 31 December 2020)
__________________ Source: GDMA Pte Ltd.]
(%) Issue Maturity  Contracted (Credit)/Debit
2. Euro Debt
a. EIB ....................................
Health Sector Development... 3.965 2011 2027 EUR 45,000,000 EUR 15,000,000


[Table 66: Hungary External Funded Convertible Currency Debt: EUR Debt (Other Loans & Swap Agreements) (as of 31 December 2020)
Corporation “VEB.RF”
European Union ............	0.00	2020	2035	EUR	504,330,000	EUR	200,000,000
Total ...........................						EUR	646,979,125
d. Other loans assumed


[	Interest Rate (%)	Year	Original Amount	Principal Amount Outstanding
	Issue	Maturity		Contracted		(Credit)/Debit
c. Other loans raised
Council of Europe
Development ...............	Various	2011-20	2021-26	EUR	474,000,000	EUR	374,256,725
State Development	3.95	2019	2046	EUR	142,200,000	EUR	72,722,400
__________________ Source: GDMA Pte Ltd.]
European Union ............ 0.00 2020 2035 EUR 504,330,000 EUR 200,000,000
Total ...........................      EUR 646,979,125
"Corporation “VEB.RF”":"d. Other loans assumed"


[Table 67: Hungary External Funded Convertible Currency Debt: JPY Debt & Swap Arrangements (as of 31 December 2020)
Total Japanese Yen Debt]
 (%) Issue Maturity  Contracted (Credit)/Debit
5. Japanese Yen
a. Bonds


JPY/EUR ......................... 1.29 2020 2027 JPY (15,500,000,000) JPY (15,500,000,000)
Total ............................      JPY (92,700,000,000)
Total Japanese Yen Debt
JPY 0.00
U.S. dollar equivalent .....
USD 0.00 __________________ Source: GDMA Pte Ltd.
Table 68: Hungary External Funded Convertible Currency Debt: CNY Debt & Swap Arrangements (as of 31 December 2020)


[Table 68: Hungary External Funded Convertible Currency Debt: CNY Debt & Swap Arrangements (as of 31 December 2020)
__________________ Source: GDMA Pte Ltd.]
(%) Issue Maturity (Credit)/Debit
6. Chinese Renminbi Debt
a. Bonds


7. Internally Raised Debt of Hungary
Table 69: Hungary Internal Debt (as of 31 December 2020)


"":""
"Interest Rate":"(%)"
"Year":"Issue"
"Original Amount Contracted":"Maturity"
"Principal Amount Outstanding":"(Credit)/Debit"


"":""
"Interest Rate":""
"Year":""
"Original Amount Contracted":""
"Principal Amount Outstanding":"(millions) (millions)"
1. HUF Debt
a. Loans Fixed,


(i) 1998-20 Central Budget............. Fixed, Floating 1998-2020 2021-41   HUF 25,968,985.73
(ii) Securitization of non-interest bearing debt outstanding to the


[	Interest Rate	Year	Original Amount Contracted	Principal Amount Outstanding
	(%)	Issue	Maturity	(Credit)/Debit


b. Hungarian Government Bonds for the purpose of:
(i) 1998-20 Central Budget.............	Fixed, Floating	1998-2020	2021-41			HUF	25,968,985.73


Total Hungarian Government Bonds ...						HUF	26,008,163.45
						USD	87,463.56
c. Hungarian Treasury Bills


2. EUR Debt
a. Hungarian Treasury Bonds for the purpose of:
(i) 2017-19 Central Budget (P€MAK) ......	Floating	2017-20	2021-25			EUR	533.24


HUNGARY’S TOTAL INTERNAL
DEBT.....................................................					USD	100,158.56
__________________
Source: GDMA Pte Ltd.
Note:
(1) All totals calculated on the basis of exchange rates as on 31 December 2020. The HUF/USD and the HUF/EUR exchange rates were 297.36 and 365.13 respectively on 31 December 2020.
8. Guarantees Provided by Hungary
Table 70: Guarantees Provided by Hungary (as of 31 December 2020)


[Table 70: Guarantees Provided by Hungary (as of 31 December 2020)
__________________]
Hungary Guaranteed Debt in Foreign Currency (expressed in USD equivalents) (1)


Loans raised from international financial institutions....................... USD 31.41


Total Guarantees in Foreign Currency............................................ USD 6,638.92
Hungary Guaranteed Debt in HUF


GUARANTEES................................................................................ USD 17,757.64
__________________
Source: Hungarian State Treasury
Note: The data are audited.
(1) Calculated on the basis of exchange rates of the Hungarian National Bank as of 31 December 2020. The exchange rate was 297.36 HUF/USD on 31 December 2020.
SECTION 8: USE OF PROCEEDS


The net proceeds from the offering of this Series of the Bonds will be remitted offshore and converted into Euro to be consolidated into the Issuer’s green funding and will be used for Eligible Green Expenditures under Hungary’s Green Bond Framework, intended to finance or refinance expenditures within Hungary’s central government budget contributing the transition to a low carbon, climate-resilient and environmentally sustainable economy.
For the purposes of this section:


“Eligible Green Expenditure” means expenditure within Hungary’s central government budget contributing to Hungary’s transition to a low carbon, climate-resilient and environmentally sustainable economy, as further described in the Green Bond Framework; and


“Green Bond Framework” means the framework for the issuance of green bonds published by Hungary, available at https://akk.hu/green-bond. The Green Bond Framework has been subjected to external review by CICERO and the Second Party Opinion is available at https://akk.hu/green-bond. Additionally, for the purpose of this Series of the Bonds, a Third Party Certification Report is also available at https://akk.


hu/green-bond and at the address referred to in Section 18 “Documents Available for Inspection” of this Offering Circular. Please also refer to Section 9 “The Issuer’s Green Bond Framework and Certification” for more information on the Green Bond Framework, the Second Party Opinion and the Third Party Certification Report.


None of the Green Bond Framework, the Second Party Opinion, the Third Party Certification Report and any of the reports, opinions or contents thereof available at the Issuer’s website is incorporated in or form part of this Offering Circular.


So long any of this Series of the Bonds remains outstanding, Hungary is expected to issue a report on (i) the portfolio to which proceeds of this Series of the Bonds have been allocated and the amounts allocated on an annual basis (“Allocation Reporting”) until full allocation, and (ii) the expected environmental impact of the Eligible Green Expenditure after the full allocation or more frequently as Hungary deems necessary. The Allocation Reporting will be reviewed by a third party consultant.


Please also refer to Section 14 “Disclosure Arrangements” of this Offering Circular for more information.
SECTION 9: THE ISSUER’S GREEN BOND FRAMEWORK AND CERTIFICATION


This Section contains a summary of the Issuer’s Green Bond Framework, the Second Party Opinion and the Third Party Certification Report. The summary does not contain all of the information in, and thus is qualified in its entirety by, the Issuer’s Green Bond Framework, the Second Party Opinion and the Third Party Certification Report, respectively, available at the address referred to in Section 18 “Documents Available for Inspection” of this Offering Circular.


1. Summary of the Issuer’s Green Bond Framework
The Green Bond Framework of Hungary released in May 2020 (the “Framework”) is in line with the voluntary guidelines of the Green Bond Principles (2018 edition) published by the International Capital Markets Association (“ICMA”) and intends to align with the most recent market practices, in particular the proposed EU Green Bond Standard by the EU TEG 4 .


The Guidelines on Green Note of Non-Financial Enterprise published by the NAFMII 5 and the Japanese Ministry of Environment Green Bond Guidelines 6 are also taken into consideration when developing the Framework.


For the governance of Hungary’s Green Bond Framework, the Ministry of Finance of Hungary in cooperation with ÁKK has set-up a Steering Committee and an Inter-Governmental Working Group (“IWG”) composed by senior officials and representatives respectively of the following Ministries of Hungary:
(a) Ministry of Finance (Chair);
(b) Ministry of Innovation and Technology, responsible in particular for energy and transport policies;
(c) Ministry of Agriculture;
(d) Ministry of Interior; and
(e) ÁKK.


(1) Use of Proceeds
An amount equal to the net proceeds of Hungary’s issuances under the Framework is intended to finance or refinance expenditures within Hungary’s central government budget contributing the transition to a low carbon, climate-resilient and environmentally sustainable economy (“Eligible Green Expenditures”).


Eligible Green Expenditures might include investment expenditures, intervention expenditures, tax expenditures and selected operating expenditures. Eligible Green Expenditures may also include expenditures towards government agencies and other public sector entities, providing that these entities do not raise any green funding themselves. Furthermore, budget expenditures which already obtain dedicated funding (e.g.


a dedicated tax, proceeds from sale of the European Emissions Trading System allowances or EU funding) are excluded.
Eligible Green Expenditures should fall within the definition of one of the six green sectors below (the “Green Sectors”):
(a) renewable energy;
(b) energy efficiency;
(c) land use and living natural resources;
(d) waste & water management;
(e) clean transportation; and


4 5 6 https://ec.europa.eu/info/files/190618-sustainable-finance-teg-report-green-bond-standard_en http://www.nafmii.org.cn/english/lawsandregulations/selfregulatory_e/201801/t20180110_67080.html http://www.env.go.jp/policy/guidelines_bond_version.pdf
(f) adaptation.
For the definition of each of the above Green Sectors, please see the Framework available at the address referred to in Section 18 “Documents Available for Inspection” of this Offering Circular.


Any expenditure related to the following activities will be excluded from Green Eligible Expenditures:
(a) nuclear power;
(b) armament and defence sector; and
(c) fossil fuel production and power generation.
(2) Process for Expenditure Evaluation and Selection
The evaluation and selection of Eligible Green Expenditures is performed on an annual basis by the IWG. See below the process for Eligible Green Expenditures evaluation and selection:


[The evaluation and selection of Eligible Green Expenditures is performed on an annual basis by the IWG. See below the process for Eligible Green Expenditures evaluation and selection:
(3) Management of Proceeds]


Steering Committee and IWG chairmanship coordination of identification process Ministry of Finance


Identification of Potential Green Budget Expenses Each relevant ministry, and in particular:  Ministry of Finance  Ministry of Innovation and Technology  Ministry of Agriculture  Ministry of Interior
Evaluation and selection of potential green expenditures IWG
Approval of Eligible Green Expenditures Steering Committee
(3) Management of Proceeds


The Ministry of Finance is in charge of green bonds proceeds management, which will be performed annually on a notional basis. See below the process for management of proceeds:


[The Ministry of Finance is in charge of green bonds proceeds management, which will be performed annually on a notional basis. See below the process for management of proceeds:
(4) Reporting]

Data collection and monitoring of Eligible Green Expenditures IWG

Approval of proceeds allocation Steering Committee

Keeping record of unallocated green bonds funding Ministry of Finance
(4) Reporting
Hungary is committed to provide investors with transparent reporting:


(a) on the allocation of proceeds towards Eligible Green Expenditures on an annual basis (the “Allocation Reporting”); and
(b) on the environmental impact of those expenditures after the full allocation of the bond proceeds
or more frequently as Hungary deems necessary (the “Impact Reporting”).
See below the process for green bond reporting:


[See below the process for green bond reporting:
External review 7	CICERO
Final validation	Steering Committee
]

Coordination of reporting process Ministry of Finance

Data collection and green bond report drafting Each relevant ministry, and in particular:  Ministry of Finance  Ministry of Innovation and Technology  Ministry of Agriculture  Ministry of Interior

Review and pre-validation IWG


[Process for green bond reporting
Coordination of reporting process	Ministry of Finance
Data collection and green bond report drafting	Each relevant ministry, and in particular:  Ministry of Finance  Ministry of Innovation and Technology  Ministry of Agriculture  Ministry of Interior
Review and pre-validation	IWG


In addition to basic information (e.g. ISIN references, reporting period, frequency of reporting and name of the external providers), the Allocation Reporting will include information on the green bonds, such as the total proceeds raised, the amount allocated to Eligible Green Expenditures as of the end of the reporting period and its breakdown by Green Sectors.]
"External review 7":"Final validation"
"CICERO":"Steering Committee"


In addition to basic information (e.g. ISIN references, reporting period, frequency of reporting and name of the external providers), the Allocation Reporting will include information on the green bonds, such as the total proceeds raised, the amount allocated to Eligible Green Expenditures as of the end of the reporting period and its breakdown by Green Sectors.


The Impact Reporting will provide information on the Eligible Green Expenditures, based on existing publicly available data and subject to the availability of the relevant information. The approach to Impact Reporting may be updated over time to align with emerging reporting standards and depending on Hungary’s own information reporting and collection system.


The Impact Reporting aims to provide information on output indicators, such as the contribution to EU Environment Objectives and others indicators indicated in the Green Bond Framework. Environmental impact indicators are expected to focus on carbon impact metrics (GHG emissions avoidance) where it can be quantified.
(5) External Review


Hungary is providing pre-issuance verification and will seek to provide post-issuance review. Hungary will also consider to engage external reviewer(s) as deemed necessary to fulfil local issuance requirements.
(a) Green Bond Framework pre-issuance verification
Hungary has engaged CICERO to provide an independent Second Party Opinion on the Green Bond Framework. Second Party Opinion documents are publicly available, and updated as the case may be, on the Green Bond section of ÁKK’s website.


(b) Allocation Reporting post-issuance review
Hungary will engage an independent third party to provide assurance on the Allocation Reporting and its conformity with the Green Bond Framework. The initial Allocation Reporting is provided by CICERO. This process will be made on an annual basis until full allocation.


For more information on the Issuer’s Green Bond Framework, please refer to the full text thereof disclosed together with this Offering Circular through the Designated Disclosure Methods or on the Green Bond section of ÁKK’s website (https://akk.hu/green-bond).
2. Summary of the Second Party Opinion


On 25 May 2020, CICERO Shades of Green AS (“CICERO”) issued a Second Party Opinion on Hungary’s Green Bond Framework. The Second Party Opinion remains relevant to all green bonds and/or loans issued under the Framework for the duration of three years from publication of this Second Party Opinion, as long as the Framework remains unchanged.


CICERO’s second opinions are graded dark green, medium green or light green, reflecting a broad, qualitative review of the climate and environmental risks and ambitions. The shading methodology aims to provide transparency to investors that seek to understand and act upon potential exposure to climate risks and impacts. Investments in all shades of green projects are necessary in order to successfully implement the ambition of the Paris agreement.


Sound governance and transparency processes facilitate delivery of an issuer’s climate and environmental ambitions laid out in its green bond framework. Hence, the governance aspects are carefully considered and reflected in the overall shading of the green bond framework. CICERO considers four factors in its review of an issuer’s governance processes: 1) the policies and goals of relevance to its green bond framework;


2) the selection process used to identify and approve eligible projects under such framework, 3) the management of proceeds and 4) the reporting on the projects to investors. Based on these factors, CICERO assigns an overall governance grade: Fair, Good or
7 See part (5) “External Review”.
Excellent.


Based on an assessment of the Issuer’s Green Bond Framework’s alignment with the Green Bond Principles, the project categories and Hungary’s governance, Hungary’s Green Bond Framework receives the overall CICERO Medium Green shading and a governance score of Good.


This shading reflects the Framework’s strength focusing on electric railway expenditures, but also Light Green elements such as improved fossil fuel related assets and investments without clearly defined eligibility criteria or thresholds.
For more information on the Second Party Opinion, please refer to the full text thereof disclosed together with this Offering Circular through the Designated Disclosure Methods or on the Green Bond section of ÁKK’s website (https://akk.hu/green-bond).


3. Summary of the Third Party Certification Report
On 18 October 2021, the Third Party Certification Institution issued the Third Party Certification Report for the purpose of this Series of the Bonds.
(1) Scope of Certification


The Third Party Certification Institution was engaged by the Issuer to provide an independent pre-issuance certification for the issuance of this Series of the Bonds. This certification is to provide a professional evaluation of the compliance of this Series of the Bonds, excluding any financial indicators and any value judgments regarding bond investments.
(2) Contents of the Certification
The Third Party Certification Report covers the following aspects of this Series of the Bonds:


• Use of Proceeds;
• Process for Expenditure Evaluation and Selection;
• Management of Proceeds; and
• Reporting.
(3) Certification Standards
• Guidelines for Green Bond Evaluation and Certification (Interim)(PBOC, CSRC [2017] No.20) (《绿色债券评估认证行为指引（暂行）》（中国人民银行、证监会公告[2017]第 20号）)；
• Relevant self-regulatory rules of NAFMII；
• Green Bond Endorsed Projects Catalogue (2021 Edition) (《绿色债券支持项目目录（2021年 版）》)；
• Green Bond Principles(June 2021) (《绿色债券原则》（2021年 6月版）)；


• United Nations Sustainable Development Goals (《联合国可持续发展目标》).
(4) Conclusions


The Third Party Certification Institution reviewed the relevant documents, including but not limited to this Offering Circular, the Issuer’s Green Bond Framework and the Second Party Opinion. Combined with its due diligence exercise, the Third Party Certification Institution evaluated the relevant work undertaken by Hungary in its use of proceeds, process for expenditure evaluation and selection, management of proceeds and reporting.


It is determined that all the proceeds from this Series of the Bonds are allocated to the green industries in compliance with the relevant requirements of the Green Bond Endorsed Projects Catalogue (2021 Edition), the Green Bond Principles (June 2021), the Sustainable Development Goals, and the relevant self-regulatory rules of NAFMII.
For more information on the Third Party Certification Report, please refer to the full text thereof


disclosed together with this Offering Circular through the Designated Disclosure Methods or on the Green Bond section of ÁKK’s website (https://akk.hu/green-bond).
SECTION 10: SELLING RESTRICTIONS
1. General
The distribution of this Offering Circular or any other offering materials relating to this Series of the Bonds and the issue, sale and delivery of this Series of the Bonds must comply with the rules and limitations of any selling restrictions of the relevant jurisdictions.


Accordingly, each reader of this Offering Circular or any other offering documents relating to this Series of the Bonds shall consult with its own legal advisors with regard to selling restrictions and is advised to observe such selling restrictions. This Offering Circular does not constitute an offer or an invitation to subscribe for or purchase any Bonds without authorization.


This Series of the Bonds will be offered only on the Interbank Market. Except for the registration with NAFMII, no actions have been taken or will be taken in relation to a public offering of this Series of the Bonds, nor in respect of listing on the Shanghai Stock Exchange or the Shenzhen Stock Exchange or in any other countries or jurisdictions.
2. PRC


This Series of the Bonds will only be offered or distributed to institutional investors of the Interbank Market (other than purchasers prohibited under PRC laws, regulations and these distribution restriction provisions) and this Series of the Bonds will be only traded among institutional investors of the Interbank Market (other than purchasers prohibited from the PRC laws, regulations and these distribution restriction provisions).


Offshore investors participating in the subscription of this Series of the Bonds through the “Bond Connect” regime should, in connection with the registration, custody, clearing, settlement of this Series of the Bonds and remittance and conversion of funds, comply with applicable laws and regulations, including the Interim Measures for the Connection and Cooperation between the Mainland and the Hong Kong Bond Market published by PBOC, as well as rules of other relevant parties and service providers


.
3. Hong Kong
This Series of the Bonds have not been and will not be offered or sold in Hong Kong by means of any document other than: (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance; or (b) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap.


32) of Hong Kong or which do not constitute an offer to the public within the meaning of that Ordinance.


No advertisement, invitation or document relating to this Series of the Bonds has been or will be issued (whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to this Series of the Bonds which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance and any rules made under that Ordinance


.
4. Singapore
Notification under Section 309B(1)(c) of the Securities and Futures Act (Chapter 289) of Singapore (the “SFA”): In connection with Section 309B of the SFA and the Securities and Futures


(Capital Markets Products) Regulations 2018 of Singapore (the “CMP Regulations 2018”), the Issuer has determined the classification of this Series of the Bonds as prescribed capital markets products (as defined in the CMP Regulations 2018) and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).
5. United States


This Series of the Bonds have not been and will not be registered under the U.S. 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. The Lead Underwriter has represented, warranted and undertaken that it has not offered or sold, and will not offer or sell, any Bonds within the United States except in accordance with Rule 903 of Regulation S under the U.S.


Securities Act and, accordingly, that neither it nor any of its affiliates (including any person acting on behalf of the Lead Underwriter or any of its affiliates) has engaged or will engage in any directed selling efforts with respect to this Series of the Bonds. Terms used in this paragraph have the same meanings assigned to them in Regulation S under the U.S. Securities Act.


In addition, until 40 days after the commencement of the offering of this Series of the Bonds, an offer or sale of Bonds within the United States by any dealer (whether or not participating in the offering) may violate the registration requirements of the U.S. Securities Act.
6. Hungary


Neither this Offering Circular nor any of the disclosure documents in connection with this Series of the Bonds has been or will be submitted to the National Bank of Hungary acting as the financial supervisory authority of Hungary and this Series of the Bonds will not be offered in Hungary in a public offer or a private placement as defined in the Act No. CXX of 2001 on the Capital Markets.


The Lead Underwriter confirms its awareness of the above and represents that it has not offered or sold, and undertakes that it will not offer or sell, this Series of the Bonds in Hungary in a public offer or a private placement and will not offer this Series of the Bonds for sale to the general public in Hungary.
SECTION 11: TAXATION RELATING TO THIS SERIES OF THE BONDS


The following summary of certain tax consequences of the purchase, ownership and disposition of this Series of the Bonds is based upon applicable laws, regulations, rulings and decisions in effect as at the date of this Offering Circular, all of which are subject to change (possibly with retroactive effect).


This summary is not intended to be a comprehensive description of all the tax considerations that may be relevant to a decision to purchase, own or dispose of this Series of the Bonds and is not intended to deal with consequences applicable to all categories of prospective investors, some of which may be subject to special rules.


Each prospective investor considering the purchase of this Series of the Bonds should consult its own tax advisors concerning the possible tax consequences relating to this Series of the Bonds.
1. PRC Taxation
(1) Value-added tax (“VAT”) and local surcharge and levies
(a) Domestic PRC investors
The Public Notice on Comprehensive Roll-out of the Pilot Programme for Transforming Business Tax to VAT issued by the Ministry of Finance and the State Administration of Taxation (Caishui [2016] No.


36) (“Circular 36”), which became effective on 1 May 2016, provides that, provision of services within the PRC (such term contemplating that the provider or recipient of such services is located within the PRC, except for leasing of real properties) is subject to VAT, and income derived from the usage and borrowing of funds, including interest income derived during the holding (including maturity) of financial products, is subject to VAT.


VAT applies to lending services where the taxable turnover is the gross amount of the interest income and any income in the nature of interest. The transfer of financial products, including transfer of the ownership of marketable securities, is subject to VAT on the taxable turnover which is the balance of the sales price less the purchase price.


With respect to a general VAT taxpayer, output VAT shall be calculated at 6% of the taxable turnover on the difference between output VAT and input VAT on the taxable items mentioned above. In the case of a small-scale VAT taxpayer, VAT shall be calculated at 3% of the taxable turnover on the taxable items mentioned above, without any credit for input VAT.


A VAT taxpayer is also subject to urban maintenance and construction tax at 7%, education surcharge at 3%, local education surcharge at 2% and potential applicable other local surcharges. Therefore, domestic PRC investors’ interest income and gains from transferring or selling this Series of the Bonds are subject to VAT and the relevant surcharges.
(b) Foreign investors


Pursuant to Circular 36, it is possible that the revenues of foreign entities and individuals generated from their provision of services to foreign entities or individuals are not deemed as the provision of services within the PRC and therefore not subject to VAT.


As a result, if the interest income on this Series of the Bonds received by foreign investors is regarded as providing lending services to foreign issuer of bonds, such services are not categorized as provision of services in the PRC, thus interest income on this Series of the Bonds received by foreign investors is not subject to VAT.


Furthermore, pursuant to the Circular on Renewal of Enterprise Income Tax and Value-added Tax in relation to Investments in PRC Bond Markets by Overseas Institutional Investors issued by the Ministry of Finance and the State Administration of Taxation of the PRC, during period from 7 November 2021 to 31 December 2025, interest income received by overseas institutional investors from investing in the PRC bond markets is exempt from VAT.


In addition, Circular 36 categorizes transfers of financial products as the provision of financial services. Pursuant to the Supplemental Circular on VAT Policies Relating to Transactions between Financial Institutions issued by the Ministry of Finance and the State Administration of Taxation (Caishui [2016] No.70), the income of foreign investors that are


approved by PBOC from investing in the interbank bond market is exempt from VAT. Therefore, if the gains of foreign investors on the transfer or sale of this Series of the Bonds are recognized as such income, such gains are exempt from VAT and the relevant surcharges.
(2) Enterprise Income Tax (“EIT”)
(a) EIT for PRC Tax Residents


This Series of the Bonds and any interest thereon are not exempt from taxation under PRC law. According to the Enterprise Income Tax Law of the PRC and its Implementation Rules, investors of this Series of the Bonds who are PRC resident enterprises shall be subject to income tax for the interest income received from this Series of the Bonds held by them and for gains received from the transfer or sale of this Series of the Bonds.


Such income shall be included in such investors’ revenues recognized in the respective period, income tax on which is generally assessed at the rate of 25%.
(b) EIT for Non-PRC Tax Residents


The Enterprise Income Tax Law of the PRC and its Implementation Rules provides that a non-resident enterprise that has no business establishment or place in the PRC, or has business establishment or place in the PRC but the income derived is not effectively connected with such business establishment or place, is subject to EIT on the income sourced from the PRC.


The source of income for interest is determined on the basis of the location of the enterprise or entity that bears or pays such income; for income derived from transfer of movable property, the source of income is determined on the basis of the location of the enterprise or entity that transfers such property.


If an investor of this Series of the Bonds is a non-resident enterprise that has no business establishment or place in the PRC or that has a business establishment or place in the PRC but the income derived is not effectively connected with such business establishment or place, and the interest arising from this Series of the Bonds is borne and paid by a foreign bond issuer, such interest income shall be regarded as income sourced from outside of the PRC and the investor shall not be subject to EIT on such interest income


. Additionally, if an investor is a non-resident enterprise located outside the PRC, the gain derived by such Bondholder from transferring or selling this Series of the Bonds shall be regarded as the income sourced from outside the PRC and thus shall not be subject to EIT.


Furthermore, pursuant to the Circular on Renewal of Enterprise Income Tax and Value-added Tax in relation to Investments in PRC Bond Markets by Overseas Institutional Investors issued by the Ministry of Finance and the State Administration of Taxation of the PRC, during the period from 7 November 2021 to 31 December 2025, interest income received by overseas institutional investors from investing in the PRC bond markets that are not derived from, nor associated with, any entities or establishments of such overseas institution in the PRC is exempt from EIT


.
(3) Stamp Duty
Pursuant to the Provisional Rules of the PRC on Stamp Duty (the “Stamp Duty Rules”) and its implementation rules, persons or entities who conclude or receive documents of transfer of property title or other taxable vouchers within the PRC shall pay stamp duty.


Pursuant to the Stamp Duty Law of the PRC (the “Stamp Duty Law”), to be implemented on 1 July 2022, persons or entities who conclude taxable vouchers or conduct securities transactions within the PRC shall be taxpayers of stamp duty and pay stamp duty. Currently the transfer of the Bonds is not subject to stamp duty under the Stamp Duty Rules, its implementation rules and the Stamp Duty Law.
2. Hungary Taxation


The following is a general discussion of certain Hungarian tax consequences of the acquisition, ownership and disposition of this Series of the Bonds by the holders. It does not purport to be a comprehensive description of all tax considerations, and, in particular, does not consider any specific facts or circumstances that may apply to a particular holder. This summary is based on the laws of Hungary currently in force and as applied on the date of this Offering Circular which are subject to


change, possibly with retroactive effect.
Prospective holders are advised to consult their own tax advisers as to the tax consequences of the acquisition, ownership and disposition of this Series of the Bonds, including the effect of any state or local taxes, under the tax laws of Hungary and each country of which they are residents.
(1) Non-Hungarian Tax Residents


Holders other than individuals. Non-Hungarian tax resident holders other than individuals are not subject to tax in Hungary with respect to any income resulting from the acquisition, ownership and disposition of this Series of the Bonds.


Individual holders. Individual non-Hungarian tax resident holders can only be subject to tax in Hungary with respect to their Hungarian source income. Interest paid by Hungary with respect to this Series of the Bonds is regarded as Hungarian source income and is subject to a 15% capital gain and interest income tax (a specific withholding tax).


If the disburser of the interest (proceeds) is tax resident in Hungary, it is obliged to assess, withhold, pay and report this tax liability to the Hungarian Tax Authority, if any. Such disburser is required to provide information to the authorities on the beneficial owner and the interest paid with respect to recipients who are residents of member states of the EU.


Recipients who are subject to the provisions of any applicable tax treaty to which Hungary is a party can be exempt from tax or subject to a reduced tax rate as set by the treaty.
Individual recipients who are not tax exempt have to file a tax return and, if the tax has not been withheld by the disburser or the interest is paid by a payer not qualified to be a disburser, pay the tax to the Hungarian Tax Authority directly by May 20th of the year following the year of the receipt of the interest.


Individuals claiming exemption or reduction of tax on the basis of any applicable tax treaty shall be required to furnish the disburser with the prescribed tax residence certificate and a certificate of beneficial ownership. If more tax is withheld than prescribed by the law, the recipient may apply for a refund at the Hungarian Tax Authority, which will also require a certificate of tax residence and beneficial ownership.


If the interest is paid by a foreign tax resident disburser, it is not subject to any withholding obligation.
Those individuals which are subject to the above described income tax and (i) are resident in an EEA member state and exercise their right of free movement in Hungary (exceeding three months) and (ii) have a registered home in Hungary shall be subject to a 6% health care contribution 8 in addition to the 15% tax.
(2) Transfer Tax


Other than receipt by way of contract on inheritance (which refers to a special type of contract between individuals in order to receive inheritance exchange for support, life annuity or care to the testator or to a third person appointed by the testator), the sale or other disposition of this Series of the Bonds, as well as the purchase or receipt of this Series of the Bonds, are not subject to transfer taxes or stamp duties in Hungary.


The receipt of this Series of the Bonds may only subject holders to Hungarian transfer tax when this Series of the Bonds are transferred gratuitously (by way of gift or otherwise for no consideration) and are delivered within Hungary. Effective from 1 January 2009, inheritance of debt securities issued by Hungary is exempt from inheritance tax.
(3) Hungarian Tax Residents


Non-individual Hungarian tax residents are corporate organizations incorporated (established) under Hungarian laws or those having their place of management in Hungary. Individual Hungarian tax residents are persons: (i) who are citizens of Hungary, (ii) whose stay in Hungary exceeds 183 days within a calendar year, (iii) who have a home permanently available solely in Hungary, (iv) whose center of vital interests is in Hungary, if they do not have a permanent home in Hungary or have such place both in Hungary and in other jurisdictions, or (v) whose habitual residence is in Hungary, if they do not have a permanent home and heir center of vital interests is not determinative


8 As of 1 January 2017, health care contribution levied on interest income had been abolished.


If the holders of this Series of the Bonds are Hungarian Tax Residents, interest and capital gains earned with respect to this Series of the Bonds are subject to Hungarian corporate and personal income tax and the health care contribution 9 in general. Preferential tax rate or tax exemption is available for long-term investments and notes issued for the market of retail investors by the Hungarian state, subject to specific conditions laid down by the applicable laws.


9 As of 1 January 2017, health care contribution levied on interest income had been abolished.
SECTION 12: CREDIT RATINGS
1. Summary of the Rating
The Credit Rating Agency, China Lianhe Credit Rating Co., Ltd., has assigned a long-term issuer credit rating (national scale) of AAA to Hungary and an issue rating of AAA to this Series of the Bonds, with a stable rating outlook.


The Credit Rating Agency is of the view that Hungary has a well-established institutional framework, with governance capacity remaining relatively strong in recent years. As an open economy with relatively strong competitiveness worldwide, Hungary maintained positive economic growth between 2016 and 2019, but suffered a deep economic recession caused by the COVID-19 in 2020, with unemployment rate slightly elevated while inflation remaining at a healthy level.


Hungary’ economic and industrial structure keeps stable in recent years, and risks related to the banking sector remains at a manageable level. Hungary’s government deficit is manageable and the government debt is well covered by stable government revenue in recent years. However, the Government announced some fiscal protection schemes in 2020, leading to widened fiscal deficit and increased government debt levels.


Although Hungary’s external debt level is relatively high, its capacity to repay external debt remains strong in recent years. Additionally, the Credit Rating Agency also factors in the enhanced economic relations between Hungary and China as well as the renewed currency swap agreement signed by the two sides.


Looking forward, the Hungary’ economic and fiscal performances are expected to recover in 2021 and 2022 on the back of gradually easing pandemic and economic protection scheme of the Government.
2. Strengths


 Continuous support from the EU funds will facilitate the recovery of Hungarian economy;  With external debt on a downward trend in recent years, the Hungary’s capacity to repay external debt remains strong;  The governance capacity of Hungary is relatively strong;  Hungarian banking sector remains healthy in recent years, with asset quality continuously improving;  Principal and interests of this Series of the Bonds will be repaid from the actual annual budget


of the government, which is a stable and reliable source of repayment.
3. Concerns
 The COVID-19 pandemic had adverse effects on Hungary’s economy growth, fiscal and external condition in 2020;  Government’s economic protection schemes widened the fiscal deficit and increased


government debt, with the Government’s capacity to repay debt slightly weakened in 2020;  Hungary’s growth potential might be constrained by ageing population and labor shortage in the medium term;  High degree of dependence on foreign trade makes Hungary vulnerable to external shocks.
4. Surveillance Arrangements for this Series of the Bonds


In accordance with applicable rules and compliance requirements, the Credit Rating Agency will perform regular or ad hoc surveillances on the credit status of the Issuer and this Series of the Bonds during the tenor of this Series of the Bonds. The Issuer shall provide the Credit Rating Agency with the information required for surveillances at the Credit Rating Agency’s request.


The Credit Rating Agency will perform surveillances at least once a year and issue surveillance reports before July 31st every year during the tenor of the Bonds. In case of major changes of the Issuer or this Series of the Bonds, or emergencies that may materially affect the credit status of the Issuer or this Series of the Bonds, the Issuer shall inform the Credit Rating Agency in a timely manner and


provide the Credit Rating Agency with relevant information. The Credit Rating Agency will keep an eye on the economic trend and fiscal stance of the Issuer as well as relevant information about this Series of the Bonds. In case of major changes of the Issuer or emergencies that may materially affect the credit status of the Issuer or this Series of the Bonds, the Credit Rating Agency may affirm or adjust the credit ratings based on its research and analysis on such events.


If the Issuer fails to provide the Credit Rating Agency with the relevant information required for surveillances in a timely manner, the Credit Rating Agency may withdraw the credit ratings based on the relevant situation. The Credit Rating Agency will assign a designated person to contact with the issuer, and release surveillance reports in a timely manner according to regulatory requirements.


The Credit Rating Agency will inform regulatory authorities and disclose relevant information at the same time.
SECTION 13: CREDIT ENHANCEMENT
This Series of the Bonds are not secured, and the interest on and principal of this Series of the Bonds will be paid on the Issuer’s credit.
SECTION 14: DISCLOSURE ARRANGEMENTS


The Issuer shall make accurate, truthful, complete and timely disclose of the information related to this Series of the Bonds in accordance with the requirements of NAFMII. During the offering process of this Series of the Bonds and during the period in which they remain outstanding, the Issuer will disclose the relevant information through the Designated Disclosure Methods, on the Interbank Market in accordance with the requirements of NAFMII.
1. Documents Relating to this Series of the Bonds


The Issuer will, by no later than two (2) Business Days before the Bookbuilding Date of this Series of the Bonds, disclose the following documents through the Designated Disclosure Methods:
(1) the Offering Circular and any supplement thereto (where applicable) in relation to this Series of the Bonds;
(2) a copy of the legal opinion of Dr. Zsolt Szita Law Office in relation to the issuance of this Series of the Bonds (English version with Chinese translation);


(3) a copy of the legal opinion of Fangda Partners in relation to the issuance of this Series of the Bonds;
(4) a copy of the Green Bond Framework of the Issuer (English version with Chinese translation);
(5) a copy of the Second Party Opinion (English version with Chinese translation);
(6) a copy of the Third Party Certification Report;
(7) a copy of the credit rating report issued by the Credit Rating Agency for this Series of the Bonds; and
(8) principal economic data of the Issuer.


2. Regular Reports
During the period in which any of this Series of the Bonds remains outstanding, the Issuer will disclose through the Designated Disclosure Methods:
(1) the updated principal economic data of the Issuer for the previous fiscal year in English no
later than October 20 of each year, and a Chinese translation thereof within 45 days after the English version is disclosed;
(2) the annual Allocation Reporting for green bonds and the external review of such report in


English no later than the end of each year, and a Chinese translation thereof within 45 days after the respective English version is disclosed; and
(3) the Impact Reporting in English on the environmental impact of the Eligible Green
Expenditure as soon as reasonably practicable after such disclosure is disclosed on the Green Bond section of ÁKK’s website and a Chinese translation thereof within 45 days after such English report is disclosed.
3. Disclosure of Material Events


During the period in which any of this Series of the Bonds remains outstanding, upon the occurrence of any Material Events (as listed below) affecting the Issuer’s ability to perform its obligations to pay the interest or principal of this Series of the Bonds, the Issuer will disclose such Material Events in Chinese or English (in the latter case, with a Chinese summary to be published within seven Business Days upon the publication of the English version) through the Designated Disclosure Methods as soon as reasonably practicable


.
“Material Events” include:  any changes in laws, regulations, treaties, conventions, approvals or authorizations of the
Issuer (or its home country or region) that may have a material impact on this Series of the
Bonds;  any Event of Default under, or acceleration or debt restructuring of, any external indebtedness of the Issuer;  any change in the rights of Bondholders, including, but not limited to, any change in the


terms and conditions of the Issuer’s other debt obligations that indirectly alters the rights of the holders of this Series of the Bonds; and  any other events that may have a material adverse effect on the Issuer’s ability to perform its
obligations (including, but not limited to, the obligation to make full payment of the principal and interest on this Series of the Bonds when due) under this Series of the Bonds.
4. Payments of Interest and Repayment of Principal


The Issuer will, on the fifth Business Day prior to the payment date of the interest of this Series of the Bonds, publish an Interest Payment Announcement through the Designated Disclosure Methods in accordance with applicable regulatory requirements.


The Issuer will, on the fifth Business Day prior to the payment date of the principal of this Series of the Bonds, publish a Final Redemption Announcement through the Designated Disclosure Methods in accordance with applicable regulatory requirements.
5. Downgrades of Credit Rating


The Issuer will disclose to investors through the Designated Disclosure Methods any downgrades of credit rating on this Series of the Bonds by the Credit Rating Agency (or any other PRC rating agency substituted for the Credit Rating Agency at the direction by the Issuer) within five (5) Business Days after such credit rating report is issued.
6. Others


If the Issuer makes any disclosure to any overseas markets (such as the U.S. or Europe) that may affect the decisions of the investors of this Series of the Bonds, the Issuer will, simultaneously or as soon as reasonably practicable thereafter, make the same disclosure in the PRC in accordance with applicable regulatory requirements through the Designated Disclosure Methods.
SECTION 15: LEGAL OPINIONS RELATING TO THIS SERIES OF THE BONDS


Fangda Partners and Dr. Zsolt Szita Law Office have, at the request of the Issuer, each issued a legal opinion in relation to this Series of the Bonds under the laws of the PRC and Hungary, respectively. The below summary does not contain all of the information in, and thus is qualified in its entirety by, each of Fangda Partners and Dr. Zsolt Szita Law Office, respectively. Investors should review the legal opinions of Fangda Partners and of Dr.


Zsolt Szita Law Office at the address referred to in Section 18 “Documents Available for Inspection” of this Offering Circular.
1. Legal Opinion of Fangda Partners
The Issuer has engaged Fangda Partners to act as its PRC legal adviser and to issue a PRC legal opinion. Such PRC legal opinion is issued on the basis that the legal adviser has conducted reasonable due diligence and relied on confirmations from the Issuer and subject to the qualifications and assumptions set forth therein.


Such legal opinion opines on the following: the Issuer has completed the registration of the Programme with NAFMII and, subject to the requirements of the Notice of Acceptance of Registration, may issue the Bonds in accordance with the Interim Measures, the Guidelines and the relevant regulations and self-regulatory rules of NAFMII; the key terms of this Series of the Bonds do not contravene any mandatory provisions of PRC laws;


upon the due authorisation, issuance and delivery by the Issuer of this Series of the Bonds, and upon the payment in full of the subscription monies therefor, this Series of the Bonds will constitute legal, valid and binding obligations of the Issuer under PRC law; the use of proceeds from the offering of this Series of the Bonds does not contravene any mandatory provisions of PRC laws;


the governing law of this Series of the Bonds is PRC law, and any dispute arising out of or in connection with this Series of the Bonds shall be submitted to CIETAC for arbitration which shall be conducted in Beijing in accordance with the CIETAC arbitration rules in effect at the time of the submission of the dispute for arbitration, such choice of law and dispute resolution mechanism of this Series of the Bonds do not contravene any mandatory provisions of PRC laws.


2. Legal Opinion of Dr. Zsolt Szita Law Office
Dr. Zsolt Szita Law Office has, with respect to the Programme and this Series of the Bonds (including with respect to the capacity and due authorization of the Issuer) issued a Hungarian legal opinion.


Such opinion is subject to certain assumptions, qualifications and reservations set forth therein, and includes the following opinions: power and capacity of the Issuer to establish the Programme and to create and issue this Series of the Bonds, the legal validity of this Series of the Bonds, the legal nature (pari passu ranking) of this Series of the Bonds, the validity of choice of law provisions of this Series of the Bonds and the capacity of the Issuer of submitting to binding arbitration and waiving immunity


.
SECTION 16: INVESTOR PROTECTIONMECHANISM
1. Post-issuance Manager and Related Responsibilities


As the Issuer of this Series of the Bonds, the Issuer assumes on-going obligations in certain aspects relating to this Series of the Bonds. The Lead Underwriter will monitor the Issuer to perform its on-going obligations under this Series of the Bonds, and has agreed to take a leading role to act as the post-issuance manager (“Post-issuance Manager”) of the Issuer, with respect to such on-going obligations of the Issuer under this Series of the Bonds. The responsibilities of the Lead Underwriter include:


(1) prompting, guiding and assisting the Issuer in a timely manner to disclose all the
information that should be disclosed in a true, accurate, and complete manner (see Section 4 “Disclosure Arrangements”);
(2) prompting, guiding and assisting the Issuer in a timely manner to specify the interest rate on


this Series of the Bonds in the Announcement on the Results of the Offering (see Term (16) under the heading “1. Terms of this Series of the Bonds” in Section 5 “Terms of this Series of the Bonds and Offering Arrangements” of this Offering Circular);
(3) (i) reminding the Issuer at least twenty (20) Business Days prior to each relevant date of the


payment of the interest or principal of this Series of the Bonds and (ii) prompting, guiding and assisting the Issuer in a timely manner to publish information in relation to the payment of the interest on and principal of this Series of the Bonds through the Designated Disclosure Methods to fulfil the Issuer’s disclosure obligations under PRC law;
(4) prompting and assisting the Issuer in a timely manner to disclose, through the Designated


Disclosure Methods, the documents as specified in the “Regular Reports” under the Section
14 “Disclosure Arrangements” of this Offering Circular in accordance with the respective timeline set forth therein;
(5) convening meetings of the holders of this Series of the Bonds and prompting, guiding and


assisting the Issuer in a timely manner to manage the holding of such meeting of this Series of the Bonds (see Term (36) under the heading “1. Terms of this Series of the Bonds” in Section 5 “Terms of this Series of the Bonds and Offering Arrangements” of this Offering Circular); and
(6) prompting and assisting the Issuer in a timely manner to timely report any material events


potentially affecting the repayment ability of the Issuer to the competent authorities of China and assisting the Issuer to make an announcement to fulfil the Issuer’s disclosure obligations under PRC law (see below as well as Term (35) under the heading “1. Terms of this Series of the Bonds” in Section 5 “Terms of this Series of the Bonds and Offering Arrangements” of this Offering Circular).
2. Event of Default; Event of Acceleration
If any of the following event occurs and is continuing:


(a) Event of Default:
(i) Non-payment: the Issuer fails to pay the interest and/or principal on any of this Series of
the Bonds within 14 days of the due date for payment thereof; or
(ii) Breach of other obligations: the Issuer defaults in the performance or observance of any


of its other obligations under or in respect of this Series of the Bonds and such default remains unremedied for 30 days after written notice thereof, addressed to the Issuer by any Bondholder, has been delivered to the Issuer; or
(b) Event of Acceleration:
(i) Failure to take action: any action, condition or thing at any time required to be taken, fulfilled or done in order: (A) to enable the Issuer lawfully to enter into, exercise its rights


and perform and comply with its obligations under and in respect of this Series of the Bonds, (B) to ensure that those obligations are legal, valid, binding and enforceable, and
(C) subject to their official translation into the Hungarian language, to make this Series of the Bonds admissible in evidence in the courts of the Issuer, is not taken, fulfilled or done within 14 days of receipt by the Issuer of written notice thereof; or


(ii) Unlawfulness: it is or will become unlawful for the Issuer to perform or comply with any
of its obligations under this Series of the Bonds, and such unlawfulness is not remedied by the Issuer within 14 days’ written notice thereof;


then, in the case of any event mentioned in either (a) or (b) above, all of this Series of the Bonds may, by written notice addressed and delivered to the Issuer by the holders of at least 25% of the aggregate principal amount of this Series of the Bonds then outstanding, be declared immediately due and payable, whereupon, unless prior to such date the Issuer shall have cured or otherwise rectified the relevant Event of Default or Event of Acceleration for all of this Series of the Bonds, all of this Series of the Bonds shall become immediately due and payable at their principal amount together with accrued interest


. The Issuer shall ensure that it will use all reasonable endeavors to give prompt notice of any such declaration to all Bondholders.
However, it shall not be an Event of Default to withhold any such payment if failure of payment is solely due to administrative errors caused by the Issuer, agency of the Custody Institution or relevant banks making transfers to such agency, except for when such failure lasts beyond three Business Days after the Bondholder’s giving a notice of no payment.


In addition, none of a failure by the Issuer to allocate the proceeds of this Series of the Bonds to Eligible Green Expenditure or to report on the use of proceeds or Eligible Green Expenditure as anticipated or a failure of a third party to issue (or to withdraw) an opinion, report or certification in connection with this Series of the Bonds or the failure of this Series of the Bonds to meet investors’ expectations requirements regarding any “green” or similar labels, for whatever reason, will constitute an Event of Default or breach of contract with respect to this Series of the Bonds


.
(c) Rescission of the Declaration of Acceleration:


If the Issuer or the Post-issuance Manager receive notice in writing from holders of at least 50% in aggregate principal amount of this Series of the Bonds then outstanding and/or a resolution is passed at a meeting of Bondholders duly convened and held in accordance with the terms and conditions set forth in this Offering Circular to the effect that the Event(s) of Default and/or Event(s) of Acceleration giving rise to a declaration of acceleration made pursuant to paragraph (i) or (ii) above is or are cured or is or are waived by them following any such declaration and that such holders approves the rescission of the relevant declaration, the Issuer shall give notice to the Bondholders of the rescission of the relevant declaration whereupon it shall be rescinded and shall have no further effect


. No such rescission shall affect any other or any subsequent Event of Default and/or Event of Acceleration or any right of any Bondholder in relation thereto. The responsibilities of the Post-issuance Manager with respect to such meeting and disclosure of information are set forth in paragraphs (5) and (6) under the heading “1. Post-issuance Manager and Related Responsibilities” in Section 16 “Investor Protection Mechanism” of this Offering Circular.
(d) Outstanding Bonds:


Please see paragraph (i)(Bonds controlled by the Issuer) of Term (36) (Meetings of Bondholders) under the heading “1. Terms of this Series of the Bonds” in Section 5 “Terms of this Series of the Bonds and Offering Arrangements” of this Offering Circular for the determination of those of this Series of the Bonds that are not deemed “outstanding” for purposes of this provision “Event of Default; Event of Acceleration”.
3. Meetings of Bondholders
(a) Definition


“24 hours” means a period of 24 hours including all or part of a day which is a Business Day (disregarding for this purpose the day upon which such meeting is to be held) and such period shall be extended by one period or, to the extent necessary, more periods of 24 hours until there is included as aforesaid all or part of a day which is a Business Day; and “48 hours” means two consecutive periods of 24 hours.


“Debt securities” means any bonds (including the Bonds), notes, debentures or other debt securities issued by the Issuer in one or more series with an original stated maturity of more than one year.


“Debt Securities Capable of Aggregation” means those debt securities which include or incorporate by reference Term (36)(a) (Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written Resolutions) and Term (36)(j) (Aggregation Agent; Aggregation Procedures) or provisions substantially in these terms providing for the debt securities which include such provisions to be capable of being aggregated for voting purposes with other series of debt securities.


An “Extraordinary Resolution” means any of a Single Series Extraordinary Resolution, and/or a Multiple Series Two Limb Extraordinary Resolution, as the case may be.


A “record date” in relation to any proposed modification or action means the date fixed by the Issuer for determining the Bondholders and, in the case of a multiple series aggregation, the holders of debt securities of each other affected series that are entitled to vote on a Multiple Series Two Limb Extraordinary Resolution, or to sign a Multiple Series Two Limb Written Resolution.
A “Reserved Matter” means any proposal to:


(i) change any date, or the method of determining the date, fixed for payment of principal or
interest in respect of this Series of the Bonds, to reduce or cancel the amount of principal or interest payable on any date in respect of this Series of the Bonds, or to alter the method of calculating the amount of any payment in respect of this Series of the Bonds on redemption or maturity or the date for any such payment;


(ii) to exchange or substitute this Series of the Bonds for, or convert this Series of the Bonds


into, other obligations or securities of the Issuer or any other person, or to modify any provision of the Terms in connection with any exchange or substitution of this Series of the Bonds for, or the conversion of this Series of the Bonds into, any other obligations or securities of the Issuer or any other person, which would result in the terms and conditions of this Series of the Bonds as so modified being less favorable to the Bondholders than:


(A) the provisions of the other obligations or debt securities of the Issuer or any other
person resulting from the relevant exchange or substitution or conversion; or
(B) if more than one series of other obligations or debt securities result from the relevant
exchange or substitution or conversion, the provisions of the resulting series of debt securities having the largest aggregate principal amount;
(iii) to change the definition of “debt securities” or “Debt Securities Capable of Aggregation”;


(iv) to change the currency in which any amount due in respect of this Series of the Bonds is
payable or the place of payment in which any payment in respect of this Series of the Bonds is to be made;
(v) amend the status of this Series of the Bonds under Term (6) (Status of this Series of the
Bonds);
(vi) amend the obligation of the Issuer to pay additional amounts under Term (30) (Taxation
Considerations);
(vii) to change any provision of this Series of the Bonds describing circumstances in which


this Series of the Bonds may be declared due and payable prior to their scheduled maturity date, as set out in Term (35) (Events of Default; Events of Acceleration);
(viii) amend the law governing this Series of the Bonds, the arbitral tribunal of the jurisdiction


to which the Issuer has submitted in connection with this Series of the Bonds, or the Issuer’s waiver of immunity, in respect of actions or proceedings brought by any Bondholder as set out in Term (33) (Governing Law) and Term (34) (Dispute Resolution);
(ix) to change the majority required to pass an Extraordinary Resolution, a Written Resolution


or any other resolution of holders of Debt Securities Capable of Aggregation or the number of percentage of votes required to be cast, or the number or percentage of debt securities required to be held, in connection with the taking of any decision or action by or on behalf of the holders of Debt Securities Capable of Aggregation or any of them;
(x) to impose any condition on or otherwise change the Issuer’s obligation to make payments


of principal, interest or any other amount in respect of this Series of the Bonds, including by way of the addition of a call option;
(xi) change the definition of “Extraordinary Resolution”, or “Single Series Extraordinary
Resolution”, or “Multiple Series Two Limb Extraordinary Resolution”, or “Written Resolution”, or “Single Series Written Resolution”, or “Multiple Series Two Limb Written Resolution” in this Term (36);


(xii) change the definition of “outstanding” or modify Term (36)(i) (Bonds controlled by the
Issuer);
(xiii) instruct any Bondholder or committee appointed on behalf of all Bondholders pursuant to
Term (36)(d), to withdraw, settle or compromise any proceeding or claim being asserted pursuant to Term (35) (Events of Default; Events of Acceleration);
(xiv) confer upon any committee appointed pursuant to Term (36)(h) (Representative


Committee of the Bondholders) any powers or discretions which the Bondholders could themselves exercise by Extraordinary Resolution;
(xv) amend this definition of “Reserved Matter”.
A “Written Resolution” means any of a Single Series Written Resolution and/or a Multiple Series Two Limb Written Resolution, as the case may be.
(b) Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written
Resolutions:


The Issuer may convene a meeting of the Bondholders at any time in respect of this Series of the Bonds in accordance with Term (36). The Issuer will determine the time, place and purpose of the meeting not less than 21 and not more than 45 days before the meeting.


The following provisions set forth the conditions and procedures for convening meetings of Bondholders to consider matters relating to this Series of the Bonds, including, without limitation, the modification of any provision of the Terms. Any such modification may be made if, having been approved in writing by the Issuer, it is sanctioned by an Extraordinary Resolution.


If Term (36) does not include such procedures, or additional procedures are required, the Issuer and the Post-issuance Manager will agree such procedures as are customary in the market and in such a manner as to facilitate any multiple series aggregation, if in relation to a Reserved Matter the Issuer proposes any modification to the terms and conditions of, or action with respect to, two or more series of debt securities issued by it.


The meeting of Bondholders shall be convened by the Post-issuance Manager upon the request (addressed to the Post-issuance Manager or to the Issuer, with a copy to the other, and setting


out the purpose of the requested meeting) in writing of the Bondholders holding not less than 10% of the aggregate principal amount of the outstanding Bonds (as defined in Term (36)(i) (Bonds controlled by the Issuer)). The Post-issuance Manager will agree the time and place of the meeting with the Issuer promptly.


The Issuer or the Post-issuance Manager, as the case may be, will notify the Bondholders within 10 days of receipt of such written request of the time and place of the meeting, which shall take place no less than 21 and no more than 45 days (exclusive of the day on which the notice is given and of the day on which the relevant meeting is held) after the date on which such notification is given.
The notice convening any meeting will specify, inter alia;


(A) the date, time and location of the meeting;
(B) the agenda and the text of any Extraordinary Resolution to be proposed for adoption at the meeting;
(C) the record date for the meeting, which shall be no more than 5 Business Days before the date of the meeting;
(D) the documentation required to be produced by a Bondholder in order to be entitled to
participate at the meeting or to appoint a proxy to act on the Bondholder’s behalf at the meeting;


(E) any time deadline and procedures required by the Custody Institution designated by
PBOC;
(F) whether Term (36)(b) (Modification of this Series of the Bonds only), or Term (36)(c)
(Multiple Series Aggregation – Two limb voting) shall apply and, if relevant, in relation to which other series of debt securities it applies;
(G) if the proposed modification or action relates to two or more series of debt securities


issued by it and contemplates such series of debt securities being aggregated in more than one group of debt securities, a description of the proposed treatment of each such group of debt securities;
(H) such information that is required to be provided by the Issuer in accordance with Term
(36)(e) (Information);
(I) the identity of the Aggregation Agent and the Calculation Agent, if any, for any proposed


modification or action to be voted on at the meeting, and the details of any applicable methodology referred to in Term(36)(f) (Claims Valuation); and
(J) any additional procedures which may be necessary and, if applicable, the conditions
under which a multiple series aggregation will be deemed to have been satisfied if it is approved as to some but not all of the affected series of debt securities.


All information to be provided pursuant to Term (36)(a) (Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written Resolutions) shall also be provided, mutatis mutandis, in respect of Written Resolutions.
(c) Modification of this Series of the Bonds only:


Any modification of any provision of, or any action in respect of, the Terms of this Series of the Bonds may be made or taken if approved by a Single Series Extraordinary Resolution or a Single Series Written Resolution as set out below.


A “Single Series Extraordinary Resolution” means a resolution passed at a meeting of Bondholders duly convened and held in accordance with the procedures prescribed by the Issuer and the Post-issuance Manager pursuant to Term (36)(a) (Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written Resolutions) by a majority of:
(A) in the case of a Reserved Matter, at least 75% of the aggregate principal amount of this
Series of the Bonds then outstanding; or


(B) in the case of a matter other than a Reserved Matter, more than 50% of the aggregate
principal amount of this Series of the Bonds then outstanding.
A “Single Series Written Resolution” means a resolution in writing signed or confirmed in writing by or on behalf of the holders of:
(A) in the case of a Reserved Matter, at least 75% of the aggregate principal amount of this
Series of the Bonds then outstanding; or


(B) in the case of a matter other than a Reserved Matter, more than 50% of the aggregate
principal amount of this Series of the Bonds then outstanding.
Any Single Series Written Resolution may be contained in one document or in several documents in the same form, each signed or confirmed in writing by or on behalf of one or more Bondholders.


Any Single Series Extraordinary Resolution duly passed or Single Series Written Resolution approved shall be binding on all Bondholders, whether or not they attended any meeting, whether or not they voted in favor thereof and whether or not they signed or confirmed in writing any such Single Series Written Resolution, as the case may be.
(d) Multiple Series Aggregation – Two limb voting
(i) In relation to a proposal that includes a Reserved Matter, any modification to the terms


and conditions of, or any action with respect to, two or more series of Debt Securities Capable of Aggregation may be made or taken if approved by a Multiple Series Two Limb Extraordinary Resolution or by a Multiple Series Two Limb Written Resolution as set out below.
(ii) A “Multiple Series Two Limb Extraordinary Resolution” means a resolution


considered at separate meetings of the holders of each affected series of Debt Securities Capable of Aggregation, duly convened and held in accordance with the procedures prescribed in Term (36)(a) (Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written Resolutions) or similar provisions in the applicable bond documentation, as supplemented if necessary, which is passed by a majority of:


(A) at least 66.67% of the aggregate principal amount of the outstanding debt securities
of affected series of Debt Securities Capable of Aggregation (taken in aggregate); and
(B) more than 50% of the aggregate principal amount of the outstanding debt securities
in each affected series of Debt Securities Capable of Aggregation (taken individually).
(iii) A “Multiple Series Two Limb Written Resolution” means each resolution in writing


(with a separate resolution in writing or multiple separate resolutions in writing distributed to the holders of each affected series of Debt Securities Capable of Aggregation, in accordance with the applicable bond documentation) which, when taken together, has been signed or confirmed in writing by or on behalf of the holders of:
(A) at least 66.67% of the aggregate principal amount of the outstanding debt securities


of all the affected series of Debt Securities Capable of Aggregation (taken in aggregate); and
(B) more than 50% of the aggregate principal amount of the outstanding debt securities
in each affected series of Debt Securities Capable of Aggregation (taken individually).


Any Multiple Series Two Limb Written Resolution may be contained in one document or several documents in substantially the same form, each signed or confirmed in writing by or on behalf of one or more Bondholders or one or more holders of each affected series of Debt Securities Capable of Aggregation.
(iv) Any Multiple Series Two Limb Extraordinary Resolution duly passed or Multiple Series


Two Limb Written Resolution approved shall be binding on all Bondholders and holders of each other affected series of Debt Securities Capable of Aggregation, whether or not they attended any meeting, whether or not they voted in favor thereof, whether or not any other holder or holders of the same series voted in favor thereof and whether or not they signed or confirmed in writing any such Multiple Series Two Limb Written Resolution, as the case may be.


(v) Any modification or action proposed under Term (36)(c)(i) may be made in respect of
certain series only of the Debt Securities Capable of Aggregation and, for the avoidance of doubt, the provisions described in Term (36)(c) may be used for different groups of two or more series of Debt Securities Capable of Aggregation simultaneously.
(e) Information


Prior to or on the date that the Issuer proposes any Extraordinary Resolution or Written Resolution pursuant to Term (36)(b) (Modification of this Series of the Bonds only), Term
(36)(c) (Multiple Series Aggregation – Two limb voting), the Issuer shall publish in accordance with Term (36)(j) (Aggregation Agent; Aggregation Procedures), and provide the Post-issuance Manager with, the following information:
(i) a description of the Issuer’s economic and financial circumstances which are, in the


Issuer’s opinion, relevant to the request for any potential modification or action, a description of the Issuer’s existing debts and a description of its broad policy reform programme and provisional macroeconomic outlook;
(ii) if the Issuer shall at the time have entered into an arrangement for financial assistance


with multilateral and/or other major creditors or creditor groups and/or an agreement with any such creditors regarding debt relief, a description of any such arrangement or agreement, and where permitted under the information disclosure policies of the multilateral or such other creditors, as applicable, copies of the arrangement or agreement shall be provided;
(iii) a description of the Issuer’s proposed treatment of securities representing External


Indebtedness that fall outside the scope of any multiple series aggregation and its intentions with respect to any other debt securities and its other major creditor groups; and
(iv) if any proposed modification or action contemplates debt securities being aggregated in
more than one group of debt securities, a description of the proposed treatment of each such group, as required for a notice convening a meeting of the Bondholders in Term


(36)(a) (Convening Meetings of Bondholders; Conduct of meetings of Bondholders; Written Resolutions).
(f) Chairman


An individual (who may, but need not, be a Bondholder) nominated in writing by the Issuer may take the chair at any meeting of Bondholders. If no such nomination is made or if the individual nominated is not present within 15 minutes after the time fixed for the meeting, Bondholders present or their proxies at the meeting shall elect one of themselves to take the chair, upon the failure of which the Issuer may appoint a chairman.


The chairman of an adjourned meeting need not be the same person as the chairman of the original meeting.
(g) Adjourned Meeting
The chairman may, with the consent of (and shall if directed by) any meeting, adjourn such meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting except business which might lawfully have been transacted at the meeting from which the adjournment took place.
(h) Notice Following Adjournment


The Post-issuance Manager will, no less than 10 days (exclusive of the day on which the notice is given and of the day on which the relevant meeting is held) prior to the date affixed for the resumed meeting, notify the Bondholders of the date, time and place of the resumed meeting
(i) Participation on Meeting of Bondholders
The following persons may attend and speak at a meeting:
(i) Bondholders and their proxies;
(ii) representatives of the Issuer and the Post-issuance Manager;


(iii) the financial advisers of the Issuer;
(iv) the legal counsel to the Issuer and to the Post-issuance Manager; and
(v) any other person approved by the meeting.
(j) Show of Hands


Every question submitted to a meeting of the Bondholders shall be decided in the first instance by a show of hands. Unless a poll is validly demanded before or at the time that the result is declared, the chairman’s declaration that on a show of hands a resolution has been passed, passed by a particular majority, rejected or rejected by a particular majority shall be conclusive, without proof of the number of votes cast for, or against, the resolution.
(k) Poll


A demand for a poll shall be valid if it is made by the chairman, the Issuer or one or more persons holding or representing no less than 2% the aggregate principal amount of this Series of the Bonds then outstanding (or, in case of a Meeting of Bondholders of Multiple Series, 2% of the aggregate principal amount of each affected series of Debt Securities Capable of Aggregation).


The poll may be taken immediately or after such adjournment as the chairman directs, but any poll demanded on the election of the chairman or on any question of adjournment shall be taken at the meeting without adjournment. A valid demand for a poll shall not prevent the continuation of the relevant meeting for any other business as the chairman directs.


At any meeting on a poll every person whose name appears in the Bondholders Record or who is a proxy or representative so present shall have one vote in respect of each Bond (face value of RMB100).
(l) Bondholders Record
The Issuer shall confirm who are the Bondholders on the Record Date who are entitled to attend the meeting of Bondholders, but the Record Date shall not be more than 10 calendar days before the meeting of the Bondholders.


The Issuer shall be responsible for obtaining the record of the Bondholders as at the Record Date (the “Bondholders Record”) from the Custodian designated by the PBOC or assisting the Post-issuance Manager (when the Post-issuance Manager convened the meeting of Bondholders) to obtain such Bondholders Record at least 48 hours before the meeting of the Bondholders.


The Bondholders registered on the Bondholders Record shall for all purposes in connection with the relevant meeting or adjourned meeting of Bondholders be deemed to be entitled to attend the meeting of Bondholders.


Any person who is a holder of a Bond on the Record Date for a proposed modification, and any person duly appointed as a proxy by a holder of an outstanding Bond on the Record Date for a proposed modification, will be entitled to vote on the proposed modification at a meeting of Bondholders and to sign a written resolution with respect to the proposed modification.


Without prejudice to the obligations of the proxies named in any form of proxy, any person entitled to more than one vote need not use all his votes or cast all the votes to which he is
entitled in the same way.
(m) Proxy
(i) Appointment: Any holder of this Series of the Bonds may appoint a proxy to vote on a


meeting of Bondholders. An appointment of proxy may be revoked if the Post-issuance Manager has been notified in writing of such revocation by the time which is 48 hours before the time fixed for such meeting.
(ii) Adjourned meetings: Unless revoked, any appointment of a proxy in relation to a meeting
of Bondholders shall remain in force in relation to any resumption of such meeting following an adjournment.


(iii) Any vote by a proxy in accordance with the relevant instruction shall be valid even if
such instruction has been amended or revoked, provided that no Post-issuance Manager has been notified in writing of such amendment or revocation by 24 hours prior to the time fixed for the relevant meeting.
(n) Minutes


Minutes shall be made of all resolutions and proceedings at each meeting of the Bondholders. The chairman shall sign the minutes, which shall be prima facie evidence of the proceedings recorded therein. Unless and until the contrary is proved, every such meeting in respect of the proceedings of which minutes have been summarized and signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings transacted at it to have been duly passed and transacted.


(o) Claims Valuation
For the purpose of calculating the face value of this Series of the Bonds and any affected series of debt securities which are to be aggregated with this Series of the Bonds in accordance with Term (36)(c) (Multiple Series Aggregation – Two limb voting), the Issuer may appoint a Calculation Agent.


The Issuer shall, with the approval of the Aggregation Agent and any appointed Calculation Agent, promulgate the methodology in accordance with which the face value of this Series of the Bonds and such affected series of debt securities will be calculated.


In any such case where a Calculation Agent is appointed, the same person will be appointed as the Calculation Agent for this Series of the Bonds and each other affected series of debt securities for these purposes, and the same methodology will be promulgated for each affected series of debt securities.
(p) Manifest Error, etc.:
This Series of the Bonds and these Terms may, subject to the prior written approval of the Issuer, be amended without the consent of the Bondholders if:


(i) such amendment or modification increases undertakings of the Issuer;
(ii) the Issuer waives any of its rights and power;
(iii) such amendment or modification provides guarantee or collateral on this Series of the
Bonds;
(iv) the amendment or modification of this Series of the Bonds is of a formal, minor or
technical nature or is made to correct a manifest error;
(v) the amendment or modification is made to comply with mandatory provisions of PRC law to correct a manifest error; or


(vi) in the reasonable belief of the Issuer, the amendment or modification does not prejudice the interest of the Bondholders.
(q) Representative Committee of the Bondholders:
(i) Appointment: The Bondholders may, by a resolution passed at a meeting of the


Bondholders duly convened and held in accordance with Term (36) by a majority of more than 50% in aggregate principal amount of this Series of the Bonds then outstanding, or by notice in writing to the Post-issuance Manager signed by or on behalf of the Bondholders holding more than 50% in aggregate principal amount of this Series of the Bonds then outstanding, appoint any person(s) as a committee to represent the interests of the Bondholders if any of the following events occurs:


(a) an Event of Default or an Event of Acceleration;
(b) any event or circumstance which would, with the giving of notice, lapse of time, the
issuing of a certificate and/or fulfilment of any other requirement provided for in Term (35) (Events of Default; Events of Acceleration) become an Event of Default or an Event of Acceleration;
(c) any public announcement by the Issuer, to the effect that the Issuer is seeking or


intends to seek a rescheduling or restructuring of this Series of the Bonds or any other debt securities (whether by amendment, exchange offer or otherwise); or
(d) with the agreement of the Issuer, at a time when the Issuer has reasonably reached
the conclusion that its debt may no longer be sustainable whilst this Series of the Bonds or any other debt securities are outstanding.
(ii) Upon receipt of a written notice that a committee has been appointed in accordance with


Term (36)(h)(i), and a certificate delivered pursuant to Term (36)(h)(vi) (Certification), the Issuer shall give notice of the appointment of such a committee to:
(A) all Bondholders in accordance with Term (36)(j)(vii) (Manner of publication); and
(B) the holders of each affected series of debt securities in accordance with the terms and conditions of such affected series of debt securities, as soon as practicable after such written notice and such certificate are delivered to the Issuer.


(iii) Powers: Such committee in its discretion may, among other things, (i) engage legal


advisers and financial advisers to assist it in representing the interests of the Bondholders, (ii) adopt such rules as it considers appropriate regarding its proceedings, (iii) enter into discussions with the Issuer and/or other creditors of the Issuer, (iv) designate one or more members of the committee to act as the main point(s) of contact with the Issuer and provide all relevant contact details to the Issuer.


The Issuer shall pay any reasonably incurred fees and expenses of any such committee as may be agreed with it (including, without limitation, the fees and expenses of the committee’s legal advisers and financial advisers, if any) within 30 days of the delivery to the Issuer of a reasonably detailed invoice and supporting documentation.


Except to the extent provided in Term (36)(i)(iii), such committee shall not have the ability to exercise any powers or discretions which the Bondholders could themselves exercise.
(iv) Engagement with the committee and provision of information
The Issuer shall:
(A) subject to Term (36)(h)(v), engage with the committee in good faith;
(B) provide the committee with information equivalent to that required under paragraph


(e) (Information) of Term (36) (Meetings of Bondholders) and related proposals, if any, in each case as the same become available, subject to any applicable information disclosure policies, rules and regulations; and
(v) If more than one committee has been appointed by the Bondholders and the affected
series of debt securities in accordance with the provisions of Term (36)(h) (Representative Committee of the Bondholders) and/or equivalent provisions set out in the


terms and conditions of any affected series of debt securities, the Issuer shall not be obliged to engage with such committees separately. Such committees may appoint a single steering group (to be comprised of representatives from such committees), whereupon the Issuer shall engage with such steering group.
(vi) Certification