Republic of Congo in $2.3 Billion London Club Debt Restructuring

December 7, 2007

Cleary Gottlieb represented the Republic of Congo in its exchange, which closed on December 7, of $2.3 billion London Club bank claims for $477,790,000 fixed-rate Eurobonds due 2029. The bonds will be listed on the Euro MTF market of the Luxembourg Stock Exchange. With a participation rate of over 92%, the Republic’s exchange offer was favorably received by the London Club creditors.

The Republic’s exchange offer targeted all outstanding external bank claims, including $300 million in principal and $2 billion in interest arrears accumulated since 1984. The restructuring plan consisted of exchanging the principal amount and interest of the eligible debt for U.S. dollar-denominated bonds issued by the Republic.

The Eurobonds offering is the Republic’s first bond issuance, issued in two contemporaneous offerings, one within the United States under an exemption from registration under the Securities Act and one outside the United States in reliance on Regulation S. In Europe, the bonds were offered to qualified investors only, thus qualifying for an exemption from the Prospectus Directive prospectus requirement.

The bonds provide for a first amortization at the time of issuance in the amount of 5% of the principal. The remaining principal will be reimbursed in 34 semi-annual graduated payments beginning on December 31, 2012. The bonds provide for concessionary interest rates starting at 2.5% for the first year and growing to 6% in the tenth year. The bonds also include collective action clauses and collective enforcement clauses designed to promote expeditious and orderly workout procedures for sovereign debtors.