To Nasdaq Copenhagen
For the purpose of aligning the status and ranking with any future Senior Non-Preferred Notes, DLR Kredit A/S varies the terms and conditions of the following Notes:
DKK 1,000,000,000 Floating Rate Senior Resolution Notes due June 2020 (ISIN: DK0006343280)
DKK 1,000,000,000 Floating Rate Senior Resolution Notes due June 2022 (ISIN: DK0006344767)
Reference is made to
- the base prospectus dated 15 May 2017 prepared by DLR Kredit A/S (the “2017 Base Prospectus”) and the Final Terms dated 9 June 2017 concerning the issue by DLR Kredit A/S of DKK 1,000,000,000 Floating Rate Senior Resolution Notes due June 2020 issued on 15 June 2017 with International Securities Identification Number (ISIN) DK0006343280 and Common Code 162996533 (the “June 2017 Senior Resolution Notes”); and
- the 2017 Base Prospectus and the Final Terms dated 12 September 2017 concerning the issue by DLR Kredit A/S of DKK 1,000,000,000 Floating Rate Senior Resolution Notes due June 2022 issued on 15 September 2017 with International Securities Identification Number (ISIN) DK0006344767 and Common Code 168099711 (the “September 2017 Senior Resolution Notes” and together with the June 2017 Senior Resolution Notes, the “Existing Senior Resolution Notes”).
The 2017 Base Prospectus, the Final Terms dated 19 June 2017 and the Final Terms dated 12 September 2017 can be viewed online at www.dlr.dk.
Terms defined in the terms and conditions of the Existing Senior Resolution Notes (but not herein) have the same meaning when applied in this letter.
On 29 May 2018, section 20 of Bill no. 184 published before the Danish Parliament on 14 March 2018 proposing implementation in Denmark of the changes to the creditor hierarchy as stipulated in Directive 2017/2399/EU (the “Senior Ranking Amendment Legislation”) was finally adopted. The Senior Ranking Amendment Legislation contains amendments to the Danish Recovery and Resolution Act to implement the changes to article 108 of BRRD set out in article 1 of Directive 2399/2017/EU that expressly provides for the possibility that, upon the insolvency of a Regulated Entity issuer of debt securities, the obligations under certain unsubordinated and unsecured liabilities (the “Senior Non-Preferred Obligations”) may rank below other unsubordinated and unsecured liabilities with higher priority ranking. The Senior Ranking Amendment Legislation will enter into force on 1 July 2018 (the “Senior Ranking Amendment Legislation Effective Date”).
The base prospectus dated 13 June 2018 prepared by DLR Kredit A/S (the “2018 Base Prospectus”) permits DLR Kredit A/S to issue so-called Senior Non-Preferred Notes which, as of the Senior Ranking Amendment Legislation Effective Date, will constitute and rank as Senior-Non Preferred Obligations (the “Senior Non-Preferred Notes”).
As stated in the 2018 Base Prospectus, DLR Kredit A/S has assessed that it is likely that the Existing Senior Resolution Notes will be considered to rank junior to any Senior Non-Preferred Notes that may subsequently be issued. DLR Kredit A/S has assessed that the implementation of the Senior Ranking Amendment Legislation constitutes an Alignment Event as defined in the terms and conditions of the Existing Senior Resolution Notes.
For the purpose of aligning the status and ranking of the Existing Senior Resolution Notes with the status and ranking of any Senior Non-Preferred Notes that may subsequently be issued, DLR Kredit A/S has decided to exercise its right to vary the terms and conditions of the Existing Senior Resolution Notes pursuant to its power to do so in Condition 7(h) of the section headed “Terms and Conditions of the Notes” of the 2017 Base Prospectus by reference to an Alignment Event having occurred as follows:
- In Condition 2 (Definitions) of the section headed “Terms and Conditions of the Notes” of the 2017 Base Prospectus, the existing definition of “Senior Ranking Amendment Legislation” shall be deleted and replaced by:
“Senior Ranking Amendment Legislation” means Section 20 of Bill no. 184 published before the Danish Parliament on 14 March 2018 and finally adopted on 29 May 2018, containing amendments to the Danish Recovery and Resolution Act to implement the changes to article 108 of BRRD set out in article 1 of Directive 2399/2017/EU that expressly provides for the possibility that, upon the insolvency of a Regulated Entity issuer of debt securities, the obligations under certain unsubordinated and unsecured liabilities (the “Senior Non-Preferred Obligations”) may rank below other unsubordinated and unsecured liabilities with higher priority ranking;”
- In Condition 2 (Definitions) of the section headed “Terms and Conditions of the Notes” of the 2017 Base Prospectus, the following new definition shall be inserted in alphabetical order:
“Senior Ranking Amendment Legislation Effective Date” means the date when the Senior Ranking Amendment Legislation becomes effective in Denmark, being 1 July 2018;”
- In Condition 4(a) (Status of the Notes) of the section headed “Terms and Conditions of the Notes” of the 2017 Base Prospectus, the existing text shall be deleted and replaced by:
“As of the Senior Ranking Amendment Legislation Effective Date, the Notes will constitute Senior Non-Preferred Obligations of the Issuer. Subject to Condition 6, the Notes constitute direct and unsecured debt obligations of the Issuer, and shall at all times rank:
(i) pari passu without any preference among themselves;
(ii) pari passu with any other obligations or instruments of the Issuer that rank or are expressed to rank equally with the Notes (including, as of the Senior Ranking Amendment Legislation Effective Date, any other Senior Non-Preferred Obligations of the Issuer), in each case as regards the right to receive periodic payments on a liquidation or bankruptcy of the Issuer and the right to receive repayment of capital on a liquidation or bankruptcy of the Issuer;
(iii) senior to holders of the Issuer's ordinary shares and any subordinated obligations or instruments of the Issuer that rank or are expressed to rank junior to the Notes, or any obligations pursuant to Section 98 of the Danish Bankruptcy Act, in each case as regards the right to receive periodic payments on a liquidation or bankruptcy of the Issuer and the right to receive repayment of capital on a liquidation or bankruptcy of the Issuer; and
(iv)junior to present or future claims of unsubordinated creditors of the Issuer pursuant to Section 97 of the Danish Bankruptcy Act or, as of the Senior Ranking Amendment Legislation Effective Date, any other unsubordinated creditors of the Issuer that are not creditors in respect of Senior Non-Preferred Obligations, in each case as regards the right to receive periodic payments on a liquidation or bankruptcy of the Issuer and the right to receive repayment of capital on a liquidation or bankruptcy of the Issuer.”
The variation of the terms and conditions of the Existing Senior Resolution Notes as set out above shall become effective on 1 August 2018.
An original version of this letter signed on behalf of DLR Kredit A/S’ management board can be viewed at the registered office of DLR Kredit A/S, Nyropsgade 21, DK-1780 Copenhagen V, Denmark.
Copenhagen, 25 June 2018
Jens Kr. A. Møller Michael Jensen
(Managing Director and CEO) (Managing Director)
Questions may be addressed to Head of IR & Rating, Pernille Lohmann at +45 33 42 08 74.
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