French Plan

Seems it is contingent upon the rating agencies not downgrading Greek debt and Papandreou maneuvering austerity through the gauntlet a second time.

Schaeuble sees a French proposal to roll over Greek debt as a “good basis” for talks, Asmussen said.
Under the French plan, private investors would receive new Greek 30-year bonds worth 70 percent of their original holdings through June 2014, with the remaining 30 percent paid in cash on maturity. Greece would use 50 percent of the original amount to pay down its debt, with 20 percent invested in zero-coupon bonds through a special purpose vehicle that will be used as collateral to insure the banks get repaid.
Banks that roll over their debt under the French plan would receive 30-year bonds with a coupon of about 5.5 percent, which could be increased by as much as 2.5 percentage points based on the pace of Greek economic growth, the people said.
In a second option, investors would reinvest at least 90 percent of their redemptions into five-year Greek government debt with a coupon of 5.5 percent, according to the proposal.
Some German lenders may favor the first option, while others with shorter-term Greek debt may prefer the second.
The plan depends upon credit-rating firms not cutting their grade on Greece and existing or newly issued government securities to default, according to the French draft proposal.
The French plan to roll over Greek sovereign debt has the backing of most of France’s banks and insurers, and it’s now up to investors in Germany and elsewhere in Europe to agree to a strategy, according to two people familiar with the matter.