PROMISE-A-2000-1 plc - KfW

The Notes are subject to the terms and conditions of a trust agreement (the "Trust Agreement") to be
dated on or about 22 December 2000 (the "Closing Date") between, inter alios, the Issuer and KPMG
Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft (the "Trustee").
Concurrently with the issue of the Notes, the Issuer, as protection seller, will enter into a credit swap
agreement with a proposed initial notional amount of €147,000,000 (the "Credit Swap Agreement")
with KfW as protection buyer (the "Credit Swap Counterparty"). Pursuant to the Credit Swap
Agreement, in the event of the satisfaction of the Conditions to Payment (as defined in "MAIN
PROVISIONS OF THE CREDIT SWAP AGREEMENT") with respect to Impaired Reference
Obligations (as defined in "SUMMARY – Principal Reductions"), the Issuer will be obliged to make
Issuer Payments (as defined in "SUMMARY – Principal Reductions") to the Credit Swap Counterparty.
On each date on which an Issuer Payment is made, the Outstanding Principal Amount of the Notes shall
be reduced by an amount equal to that Issuer Payment. Any such reduction will be applied to reduce the
Outstanding Principal Amount of first, the Class G Notes, second, the Class F Notes, third, the Class E
Notes, fourth, the Class D Notes, fifth, the Class C Notes, sixth, the Class B Notes and seventh, the Class
A Notes (the "Reverse Order of Seniority"), in each case, pari passu on a pro rata basis within any
Class of Notes, until the Outstanding Principal Amount of each such Class of Notes is reduced to zero.
Also concurrently with the issue of the Notes, KfW as protection buyer will enter into a credit swap
agreement (the "Senior Credit Swap Agreement") with an OECD bank as protection seller. KfW, as
protection seller will also enter into two credit swap agreements (the "Primary Credit Swap
Agreements") with HVB as protection buyer (the "Primary Credit Swap Counterparty") and the
allocation of amounts equal to any Issuer Payments to the Notes shall not be affected by the Primary
Credit Swap Agreements, the Senior Credit Swap Agreement or the Credit Swap Agreement provided
that while any amounts are due from the Issuer to the Credit Swap Counterparty under the Credit Swap
Agreement, the Trustee is required to have regard first, to the interests of the Credit Swap Counterparty,
second, to the interests of the Noteholders and finally, to the interests of the Trustee and if there is, at any
time, a conflict between the interests of a Class of Noteholders and any other Class or Classes of
Noteholders, the Trustee shall have regard first, to the interests of the Class A Noteholders, second, to the
interests of the Class B Noteholders, third, to the interests of the Class C Noteholders, fourth, to the
interests of the Class D Noteholders, fifth, to the interests of the Class E Noteholders, sixth, to the
interests of the Class F Noteholders and seventh, to the interests of the Class G Noteholders, in each case,
as one Class. See "THE TRUST AGREEMENT".
Interest on the Notes will be payable on 28 May 2001 and, thereafter, quarterly in arrear on the 28 th day of
February, May, August and November in each year, subject to adjustment for non-Business Days as
further described herein (each such date, an "Interest Payment Date"). Interest will accrue on the Note
Outstanding Principal Amount (as defined in "SUMMARY – Outstanding Principal Amount"), in respect
of the first Interest Payment Date, from, and including, 22 December 2000 (the "Issue Date") and to, but
excluding, the first Interest Payment Date and, in respect of any subsequent Interest Payment Date, from,
and including, the immediately preceding Interest Payment Date and to, but excluding, such Interest
Payment Date at a rate equal to EURIBOR as determined on each Interest Determination Date (each as
defined in "TERMS AND CONDITIONS OF THE NOTES – Condition 5 Interest") plus, in respect of
the Class A Notes, 0.32 per cent. per annum, in respect of the Class B Notes, 0.50 per cent. per annum, in
respect of the Class C Notes, 0.70 per cent. per annum, in respect of the Class D Notes 1.45 per cent. per
annum, in respect of the Class E Notes, 3.70 per cent. per annum, in respect of the Class F Notes, 7.00 per
cent. per annum and, in respect of the Class G Notes, 10.00 per cent. per annum.
Unless redeemed earlier or reduced to zero as described herein, the Notes will be redeemed on the Interest
Payment Date falling in February 2009 (the "Scheduled Maturity Date") provided that if any Impaired
Reference Obligations are in their Determination Period (each as defined herein) as at such date, the
Notes may remain outstanding until the Interest Payment Date falling in February 2011 and payments of
principal will be made on such Notes on each Interest Payment Date after the Scheduled Maturity Date up
(ii)