Regulatory Filings • Mar 22, 2024
Regulatory Filings
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Final Terms dated: 8 February 2024, as amended and restated on 6 March 2024
(a company incorporated in England with registered number 14259; the liability of its members is limited)
Issue of
This document constitutes the Final Terms relating to the issue of the Tranche of Notes described herein. Terms used herein shall be deemed to be defined as such for the purposes of the terms and conditions of the Notes (the "Conditions") set forth in the Base Prospectus dated 23 June 2023 in relation to the above Programme, together with each supplemental prospectus relating to the Programme published by the Issuer after 23 June 2023 but before the issue date or listing date of the Notes, whichever is later, to which these Final Terms relate which together constitute a base prospectus ("Prospectus") for the purposes of the Regulation (EU) 2017/1129) as it forms part of domestic law in the United Kingdom by virtue of the European Union (Withdrawal) Act 2018, as amended (the "UK Prospectus Regulation"). This document constitutes the Final Terms of the Notes described herein for the purposes of the Prospectus Regulation Rules sourcebook in the FCA Handbook (the "UK Prospectus Rules") and must be read in conjunction with such Prospectus. However, a summary of the issue of the Notes is annexed to these Final Terms.
Full information on the Issuer and the offer of the Notes is only available on the basis of the combination of these Final Terms and the Prospectus. The Prospectus is available for viewing during normal business hours at HSBC Bank plc, 8 Canada Square, London E14 5HQ, United Kingdom and www.hsbc.com (please follow links to 'Investors', 'Fixed income investors', 'Issuance programmes') and copies may be obtained from HSBC Bank plc, 8 Canada Square, London E14 5HQ, United Kingdom.
EU PRIIPs REGULATION - PROHIBITION OF SALES TO EEA RETAIL INVESTORS - The Notes are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the European Economic Area ("EEA"). For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, "MiFID II"); (ii) a customer within the meaning of Directive 2016/97/EU (as amended, the "Insurance Distribution Directive"), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in Regulation (EU) 2017/1129 (as amended, the "EU Prospectus Regulation"). Consequently no key information document required by Regulation (EU) No 1286/2014 (as amended, the "PRIIPs Regulation") for offering or selling the Notes or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling the Notes or otherwise making them available to any retail investor in the EEA may be unlawful under the PRIIPs Regulation.
| 1. | Issuer: | HSBC Bank plc | |
|---|---|---|---|
| 2. | Tranche Number: | 1 | |
| 3. | Settlement Currency: | British pound sterling ("GBP") | |
| 4. | Aggregate Principal Amount of Notes admitted to trading: |
||
| (i) | Series: | Up to GBP 25,000,000 | |
| (ii) | Tranche: | Up to GBP 25,000,000 |
| 5. | Issue Price: | 100 per cent. of the Aggregate Principal Amount | |
|---|---|---|---|
| 6. | (i) | Denomination(s): | GBP 1 |
| (ii) | Calculation Amount: | GBP 1 | |
| (iii) | Aggregate Outstanding Nominal Amount Rounding: |
Not Applicable | |
| 7. | (i) | Issue Date: | 22 March 2024 |
| (ii) | Trade Date: | 30 January 2024 | |
| (iii) | Interest Commencement Date: | Not Applicable | |
| 8. | Maturity Date: | 22 March 2029 adjusted in accordance with the Following Business Day Convention. |
|
| 9. | Interest basis: | Not Applicable |
| 10. | Fixed Rate Note provisions: | Not Applicable |
|---|---|---|
| 11. | Coupon Trigger Event: | Not Applicable |
| 12. | Method for determining the Final Redemption Amount of each Note: |
Autocallable Redemption | ||
|---|---|---|---|---|
| 13. | Note: | Provisions relating to the calculation of the Final Redemption Amount of each |
||
| (i) | Relevant Final Performance: | Final Index Performance of the Index | ||
| (ii) | Relevant Level: | Final Index Level | ||
| (iii) | Final Valuation Date: | 8 March 2029 | ||
| (iv) | Barrier Level: | 65 per cent. | ||
| (v) | Cap: | Not Applicable | ||
| (vi) | Final Trigger Level: | 90 per cent. | ||
| (vii) | Digital Amount: | Not Applicable | ||
| (viii) | Participation: | Not Applicable | ||
| (ix) | Protection Level: | Not Applicable | ||
| (x) | Redemption Rate: | 138.75 per cent. | ||
| (xi) | Fixed Amount Redemption Rate: |
Not Applicable | ||
(Condition 5(b) or 5(d))
(ii) Early Redemption Amount following an Event of Default: Fair Market Value
(Condition 9)
(iii) Early Redemption Amount following an Administrator/Benchmark Event: Fair Market Value
(Condition 13A)
| Automatic Early Redemption Valuation Date(s) |
Automatic Early Redemption Percentage |
Automatic Early Redemption Date(s) |
Automatic Early Redemption Rate(s) |
|---|---|---|---|
| 9 March 2026 | 100.00 per cent. | 23 March 2026 | 115.50 per cent. |
| 8 March 2027 | 100.00 per cent. | 22 March 2027 | 123.25 per cent. |
| 8 March 2028 | 90.00 per cent. | 22 March 2028 | 131.00 per cent. |
| 17. | Form of Notes: | Uncertificated Registered Notes | ||
|---|---|---|---|---|
| 18. | If issued in bearer form: | Not Applicable | ||
| 19. | Exchange Date for exchange of Temporary Global Note: |
Not Applicable | ||
| 20. | If issued in registered form (other than Uncertificated Registered Notes): |
Not Applicable | ||
| 21. | Payments: | |||
| (i) | Relevant Financial Centre Day: |
London | ||
| (ii) | Business Centre(s): | London | ||
| 22. | Redenomination: | Not Applicable |
| (i) | Index: | FTSE® 100 Index (Bloomberg Ticker: UKX) |
|---|---|---|
| (ii) | Index Sponsor(s): | FTSE International Limited |
| (iii) | Index Rules: | Not Applicable |
| (iv) | Exchange(s): | London Stock Exchange |
| (v) | Related Exchange(s): | All Exchanges |
| (vi) | Initial Index Level: | The definition in Condition 1 applies |
| (vii) | Strike Date: | 8 March 2024 |
| (viii) | Alternative Pre-nominated Index: |
Not Applicable |
| (ix) | Additional Disruption Event: | The following Additional Disruption Events apply: Change in Law, Hedging Disruption and Increased Costs of Hedging |
| (x) | Index Substitution: | Not Applicable |
(xi) Number of local banking days for the purpose of postponing Relevant Benchmark Related Payment Date pursuant to Condition 13A(c): 3
By: ........................................................................ Authorised Signatory
Date: ........................................................................
| (i) | Listing: | Application will be made to admit the Notes to listing on the Official List of the United Kingdom Financial Conduct Authority. No assurance can be given as to whether or not, or when, such application will be granted. |
|
|---|---|---|---|
| (ii) | Admission to trading: | Application will be made for the Notes to be admitted to trading on the main market of the London Stock Exchange plc. No assurance can be given as to whether or not, or when, such application will be granted. |
|
| 2. | RATINGS |
Ratings: The Notes are not rated.
| (i) | Reasons for the offer and use of proceeds: |
See the "Use of Proceeds" section of the Base Prospectus |
|---|---|---|
| (ii) | Estimated net proceeds: | Up to GBP 25,000,000 less any re-offer spread (as described below) |
| (iii) | Estimated total expenses: | GBP 5,000 |
The Notes may be on-sold by the Dealer(s) to the Plan Manager at a discount to the Issue Price of up to three per cent. Such discount (the "re-offer spread") will be retained by the Plan Manager.
Save for the re-offer spread retained by the Plan Manager, no person involved in the issue of the Notes has, so far as the Issuer is aware, an interest material to the offer. The Dealer and its affiliates have engaged, and may in the future engage, in investment banking and/or commercial banking transactions with, and may perform other services for, the Issuer and its affiliates in the ordinary course of business.
Information on the past and future performance and volatility of the Index can be obtained from the following website: www.ftserussell.com. Such information can be obtained free of charge.
| 6. | (i) | If syndicated, name and address of Dealers: |
Not Applicable |
|---|---|---|---|
| (ii) | Date of subscription agreement: |
Not Applicable | |
| (iii) | Indication of the overall amount of the underwriting commission and of the placing commission: |
Not Applicable | |
| 7. | Dealer: | If non-syndicated, name and address of | HSBC Bank plc, 8 Canada Square, London E14 5HQ |
| 8. | TEFRA Rules applicable to Bearer | TEFRA Not Applicable |
Notes:
| 19. | (i) | Principal Paying Agent/Registrar/Issue Agent/Transfer Agent: |
Computershare Investor Services PLC |
|---|---|---|---|
| (ii) | Additional Paying Agent(s) (if any): |
Not Applicable | |
| 20. | Common Depositary: | Not Applicable | |
| 21. | Calculation Agent: | HSBC Bank plc |
| 22. | Offer Price: | Issue Price |
|---|---|---|
| 23. | Total amount of the issue/offer; if the amount is not fixed, description of the arrangements and time for announcing to the public the definitive amount of |
Up to GBP 25,000,000 Notes will be issued and the criterion/condition for determining the final amount of Notes will be investor demand. |
| the offer: | A copy of these Final Terms will be filed with the FCA in the UK. On or before the Issue Date, a notice pursuant to UK Prospectus Rule 2.3.2(2) of the final aggregate principal |
amount of the Notes will be (i) filed with the FCA and (ii)
published in accordance with the method of publication set out in Prospectus Rule 3.2.4(2).
An offer of the Notes will be made other than pursuant to Article 1(4) of the UK Prospectus Regulation during the Offer
The Issuer reserves the right to withdraw the offer of the Notes for any reason and at any time prior to the end of the Offer Period. Following such withdrawal, if any application has been made by any potential investor, each such potential investor shall not be entitled to subscribe or otherwise acquire the Notes and any applications will automatically be cancelled and any purchase money will be refunded to the applicant by the Initial Authorised Offeror in accordance with the Initial Authorised Offeror's usual procedures.
The Initial Authorised Offeror is responsible for notification of any withdrawal rights applicable in relation to the offer of the Notes to potential investors.
Period.
Persons interested in purchasing Notes should contact their financial adviser. If an investor in any jurisdiction other than the United Kingdom wishes to purchase Notes, such investor should (a) be aware that sales in the relevant jurisdiction may not be permitted; and (b) contact its financial adviser, bank or financial intermediary for more information.
Any minimum or maximum amount of application will be
Prospective Noteholders will be notified by the Initial Authorised Offeror of their allocations of Notes and the settlement arrangements in respect thereof. The Notes will be issued on the Issue Date on a delivery against payment basis.
notified to investors by the Initial Authorised Offeror.
Not Applicable
The final size will be known at the end of the Offer Period. A copy of these Final Terms will be filed with the FCA in the UK. On or before the Issue Date, a notice pursuant to UK Prospectus Rule 2.3.2(2) of the final aggregate principal amount of the Notes will be (i) filed with the FCA and (ii) published in accordance with the method of publication set out in Prospectus Rule 3.2.4(2).
Not Applicable
The FTSE® 100 Index is provided by FTSE International Limited. As of the date hereof, FTSE International Limited appears in the register of administrators and benchmarks established and maintained by the FCA pursuant to Article 36 of the UK Benchmarks Regulation.
The Notes have been developed solely by the Issuer. The Notes are not in any way connected to or sponsored, endorsed, sold or promoted by the London Stock Exchange Group plc and its group undertakings (collectively, the "LSE Group"). FTSE Russell is a trading name of certain of the LSE Group companies.
All rights in the FTSE® 100 Index (the "Index") vest in the relevant LSE Group company which owns the Index. FTSE®, Russell® and FTSE Russell® are trade marks of the relevant LSE Group company and are used by any other LSE Group company under license.
The Index is calculated by or on behalf of FTSE International Limited or its affiliate, agent or partner. The LSE Group does not accept any liability whatsoever to any person arising out of (a) the use of, reliance on or any error in the Index or (b) investment in or operation of the Notes. The LSE Group makes no claim, prediction, warranty or representation either as to the results to be obtained from the Notes or the suitability of the Index for the purpose to which it is being put by the Issuer.
This summary should be read as an introduction to the prospectus for the Notes (as defined below) comprised of the base prospectus dated 23 June 2023 relating to the issuance of Index-Linked Notes and Warrants under the Programme for the Issuance of Notes and Warrants and the supplement(s) thereto (the "Base Prospectus") and the final terms in relation to the Notes (the "Final Terms" and together with the Base Prospectus, the "Prospectus" in relation to the Notes). Any decision to invest in the Notes should be based on consideration of the Prospectus as a whole by the investor. Investors could lose all or part of their invested capital. Where a claim relating to the information contained in the Prospectus is brought before a court, the plaintiff investor might, under the relevant national law, have to bear the costs of translating the Prospectus before the legal proceedings are initiated. Civil liability attaches only to those persons who have tabled this summary including any translation thereof, but only where this summary is misleading, inaccurate or inconsistent when read together with the other parts of the Prospectus or where it does not provide, when read together with the other parts of the Prospectus, key information in order to aid investors when considering whether to invest in the Notes. You are about to purchase a product that is not simple and may be difficult to understand.
The selected key financial information regarding the Issuer set out below has been extracted without material adjustment from the audited consolidated financial statements of the Issuer for the years ended 31 December 2022 and 31 December 2023. References in the accompanying footnotes to numbered pages are to the corresponding numbered pages of the Issuer's 2023 Form 20-F unless otherwise stated.
From 1 January 2023, the Issuer has adopted IFRS 17 'Insurance Contracts', which replaced IFRS 4 'Insurance Contracts'. Comparative data have been restated accordingly. In the tables that follow, the comparative data figures that have been restated are marked with an asterisk.
1 This section and the table below have been updated following the release of the Issuer's 2023 Annual Report and Accounts.
| For the period (£m) | Footnote | Year Ended | |
|---|---|---|---|
| 31 December 2022 | 31 December 2023 | ||
| Net interest income | 1,904 | 2,151 | |
| Net fee income | 1 | 1,295* | 1,229 |
| Change in expected credit losses and other credit impairment charges |
(222) | (169) | |
| Net operating income before change in expected credit losses and other credit impairment charges |
2 | 4,304* | 7,506 |
| (Loss)/profit before tax (reported basis) | (1,199)* | 2,152 | |
| Profit/(loss) attributable to the parent company | (563)* | 1,703 | |
| As at 31 December | As at 31 December | ||
| At period-end (£m) | 2022 | 2023 | |
| Total assets | 716,646* | 702,970 | |
| Senior debt | 32,771 | 38,658 | |
| Subordinated liabilities | 15,337 | 14,919 | |
| Loans and advances to customers | 72,614 | 75,491 | |
| At period-end (£m) | As at 31 December | As at 31 December | |
| 2022 | 2023 | ||
| Customer accounts | 215,948 | 222,941 | |
| Total equity | 23,233* | 24,505 | |
| Capital Ratios (%) | 3 | As at 31 December | As at 31 December |
| 2022 | 2023 | ||
| Common equity tier 1 | 16.3* | 17.9 | |
| Total capital ratio | 31.3* | 34.6 | |
| Leverage Ratio (fully phased in) | 4, 5 | 5.4* | 5.1 |
Interest income includes £16,484m (2022: £5,512m; 2021: £1,986m) of interest recognised on financial assets measured at amortised cost; £42m (2022: £422m; 2021: £659m) of negative interest recognised on financial liabilities and £1,256m (2022: £601m; 2021: £504m) of interest recognised on financial assets measured at fair value through other comprehensive income. Included within this is £117m (2022: £59m; 2021: £61m) interest recognised on impaired financial assets.
Net operating income before change in expected credit losses and other credit impairment charges is also referred to as 'revenue'.
Unless otherwise stated, regulatory capital ratios and requirements are based on the transitional arrangements of the Capital Requirements Regulation in force at the time. These include the regulatory transitional arrangements for IFRS 9 'Financial Instruments'. References to EU regulations and directives (including technical standards) should, as applicable, be read as references to the UK's version of such regulation and/or directive, as onshored into UK law under the European Union (Withdrawal) Act 2018, and as may be subsequently amended under UK law.
The leverage ratio is calculated using the end point definition of capital and the IFRS 9 regulatory transitional arrangements, in line with the UK leverage rules that were implemented on 1 January 2022, and excludes central bank claims and cash pooling netting. Comparatives for 2021 are reported based on the disclosure rules in force at that time, and include claims on central banks.
From 30 September 2022, investments in non-financial institution subsidiaries or participations have been measured on an equity accounting basis in compliance with UK regulatory requirements. Comparatives for prior periods have been represented on a consistent basis with the current year.
What are the key risks that are specific to the Issuer?
All references to "Group" refer to the Issuer and its subsidiary undertakings.
Current economic and market conditions may adversely affect the Group's results
The Group's earnings are affected by global and local economic and market conditions. In particular, the Group has faced and may continue to face the following challenges to its operations and operating model in connection with these factors: market developments may continue to depress consumer and business confidence; significant uncertainties remain in assessing the duration and impact of the ongoing the Russia-Ukraine war; the impact of the Covid-19 pandemic on global economies; the demand for borrowing from creditworthy customers may diminish during periods of recession or where economic activity slows or remains subdued and the Group's ability to borrow from other financial institutions or to engage in funding transactions may be adversely affected by market disruption. The occurrence of any of these events or circumstances could have a material adverse effect on the Group's business, financial condition, results of operations, prospects and customers.
The Group's operations are subject to potentially unfavourable political, social, environmental and economic developments in the jurisdictions in which the Group operates, which may include; coups, wars or acts of terrorism; political and/or social instability; geopolitical tensions; climate change, acts of God, including epidemics and pandemics and natural disasters; and infrastructure issues, such as transportation and power failures. Each of the above could impact credit risk-weighted assets, and the financial losses caused by any of these risk events or developments could impair asset values and the creditworthiness of customers.
These risk events or developments could also give rise to disruption to the Group's services and some could result in physical damage to its operations and/or risks to the safety of its personnel and customers. Geopolitical tensions could have significant ramifications for the Group and its customers and could have a material adverse impact on the Group's business, financial condition, results of operations, prospects, strategy and reputation, as well as on the Group's customers.
The Group's strategy has been supported by the global economic, geopolitical, legal and regulatory environment. The Group has taken into consideration global trends such as technology, customer needs and competition. The development and implementation of the Group's strategy requires difficult, subjective and complex judgements, including forecasts of economic conditions in various parts of the region. The Group may fail to correctly identify the relevant factors in making decisions as to capital deployment and cost reduction. The Group may also encounter unpredictable changes in the external environment that are unfavourable to its strategy, such as the Russia-Ukraine war. The Group's ability to execute strategic change may be limited by its operational capacity, effectiveness of its change management controls and the potential for unforeseen changes in the market and/or regulatory environment in which it operates. The European economic outlook continues to remain uncertain due to the likelihood of economic recession, heightened inflation, changes in legislation and geopolitical tensions. Therefore, there remains a risk that, in the absence of an improvement in economic conditions, the Group's cost and investment actions may not be sufficient to achieve the expected benefits. The failure to successfully deliver or achieve the expected benefits of these key strategic initiatives could have a material adverse effect on the Group's customers, business, financial condition, results of operations, prospects, operational resilience and reputation.
The Group is subject to financial and non-financial risks associated with Environmental, Social and Governance ('ESG') related matters, such as climate change, nature-related and human rights issues
ESG-related matters such as climate change, society's impact on nature and human rights issues bring risks to the Group's business, customers and wider society. If any of these risks materialise, this could have financial and non-financial impacts for the Group which could, in turn, have a material adverse effect on its business, financial condition, results of operations, reputation, prospects and strategy.
Meeting the demand to recruit, retain and develop appropriate senior management and skilled personnel remains subject to a number of challenges. If one of the Group's business units fails to staff its operations appropriately or loses one or more of their key senior executives and fails to successfully replace them in a satisfactory and timely manner, or fails to implement successfully the organisational changes required to support the Group's strategy, the Group's business, financial condition, results of operations, reputation and prospects, including control and operational risks, could be materially adversely affected.
The Group uses models for a range of purposes in managing its business, including regulatory capital calculations, stress testing, credit approvals, calculation of ECLs on an IFRS 9 basis, financial crime and fraud risk management and financial reporting. HSBC Bank plc could face adverse consequences as a result of decisions that may lead to actions by management based on models that are poorly developed, implemented or used, or as a result of the modelled outcome being misunderstood, or the use of such information for purposes for which it was not designed, or by inherent limitations arising from the uncertainty inherent in predicting or estimating future outcomes. If key capital models significantly underestimate risks or do not meet critical regulatory requirements, the Group could be required to hold additional capital. Risks arising from the use of models could have a material adverse effect on the Group's business, financial condition, results of operations, prospects and capital position and reputation.
The Group's businesses are subject to ongoing regulation, policies, voluntary codes of practice and interpretations in the UK, the EU and the other markets in which the Group operates. A number of regulatory changes impacting the Group's business have effects beyond the country in which they are enacted. In recent years, regulators and governments have focused on reforming both the prudential regulation of the financial services industry and the ways in which the business of financial services is conducted. Measures taken include enhanced capital, liquidity and funding requirements, the separation or prohibition of certain activities by banks, changes in the operation of capital markets activities, the introduction of tax levies and transaction taxes and changes in compensation practices. The Group is also seeing more detailed requirements on how business is conducted, with a focus on protecting vulnerable customers. Such regulatory changes could have a material effect on the Group's business, financial condition, results of operations, prospects, capital position, reputation and strategy.
What are the main features of the Notes?
Holders of Notes ("Noteholders") will be entitled to the following cash amounts in respect of each Note, namely:
For these purposes:
"Barrier Level" means 65 per cent.
"Final Index Performance" means, with respect to the Index and the Final Valuation Date, (x) the closing level of such Index on such date divided by (y) its Initial Index Level (expressed as a percentage), as determined by the calculation agent.
"Final Valuation Date" means 8 March 2029 (or, if such date is not a scheduled trading day, the next following scheduled trading day).
"Final Triger Level" means 90 per cent.
"Initial Index Level" means the closing level of the Index on the Strike Date.
"Redemption Rate" means 138.75 per cent.
"Strike Date" means 8 March 2024 (or, if such date is not a scheduled trading day, the next following scheduled trading day).
(ii) In addition, as "Early Redemption for Autocallable Notes" applies, the Notes may be redeemed on an Automatic Early Redemption Date if, on the relevant Automatic Early Redemption Valuation Date, the Observation Index Performance is equal to or greater than the Automatic Early Redemption Percentage specified below (an "Automatic Early Redemption Event"). In such circumstances the Noteholder would be entitled to an "Automatic Early Redemption Amount", being a cash amount equal to the denomination of the Note multiplied by the Automatic Early Redemption Rate, specified below.
For these purposes:
In respect of each "Automatic Early Redemption Valuation Date", the "Automatic Early Redemption Percentage", "Automatic Early Redemption Rate" and "Automatic Early Redemption Date" shall be as specified in relation to such Automatic Early Redemption Valuation Date in the table below.
| Automatic Early Redemption Valuation Date(s) |
Automatic Early Redemption Percentage(s) |
Automatic Early Redemption Date(s) |
Automatic Early Redemption Rate(s) |
|---|---|---|---|
| 9 March 2026 | 100.00 per cent. | 23 March 2026 | 115.50 per cent. |
| 8 March 2027 | 100.00 per cent. | 22 March 2027 | 123.25 per cent. |
|---|---|---|---|
| 8 March 2028 | 90.00 per cent. | 22 March 2028 | 131.00 per cent. |
provided that if an Automatic Early Redemption Valuation Date is not a scheduled trading day, the immediately following scheduled trading day shall be the relevant Automatic Early Redemption Valuation Date.
"Observation Index Performance" means, with respect to the Index and an Automatic Early Redemption Valuation Date (as applicable), (x) the closing level of such Index on such date divided by (y) its Initial Index Level (expressed as a percentage), as determined by the calculation agent.
Early redemption for illegality: If the calculation agent determines that the performance of the Issuer's obligations has become unlawful or impracticable in whole or in part for any reason, the Issuer may redeem all but not some only of the Notes prior to their stated maturity and pay the relevant Noteholder an amount per Note equal to the fair market value of such Note.
Early redemption for taxation reasons: If the Issuer were required under the terms and conditions of the Notes (the "Conditions") to pay additional amounts in respect of tax, the Issuer may redeem all but not some only of the Notes prior to their stated maturity and pay the relevant Noteholder an amount per Note equal to the fair market value of such Note.
Early Redemption for Additional Disruption Events, Index Cancellation or Administrator/Benchmark Event: If a change in law, hedging disruption or increased cost of hedging occurs (each an "Additional Disruption Event"), certain events occur in relation to an Index (including its suspension or cancellation) (an "Index Cancellation") or an event or circumstance which has the effect that the Issuer or the calculation agent is not, or will not be, permitted under any applicable law or regulation to use any applicable benchmark to perform its or their obligations under the Notes (an "Administrator/Benchmark Event") the Issuer may redeem all but not some only of the Notes prior to their stated maturity and pay the relevant Noteholder an amount per Note equal to the fair market value of such Note.
Events of default of the Notes: at the option of the Noteholder in the following circumstances: (i) the Issuer fails to remedy a default in the repayment of any principal due on the Notes within 14 days of notice of such default having been given to the principal paying agent or other paying agent or the registrar (as the case may be) by any Noteholder, provided that it shall not be such a default to withhold or refuse any such payment (1) if the Issuer determines, acting in good faith, that there is a material risk of the payment being contrary to any fiscal or other law or regulation or the order of any court of competent jurisdiction, or any statement, guidance, policy, recommendation or interpretation of any governmental or regulatory body (whether or not having the force of law), in each case applicable to such payment or (2) in cases of doubt as to the validity or applicability of any such law, regulation or order, in accordance with advice given at any time by independent legal advisers as to such validity or applicability; or (ii) the passing of a winding-up order in relation to the Issuer.
Modification and substitution: Modifications to the Conditions may be made without the consent of any Noteholders provided that: (i) the modification is not materially prejudicial to the interest of Noteholders; (ii) the modification is of a formal, minor or technical nature or is made to correct a manifest error or to comply with mandatory provisions of the law of the Issuer's jurisdiction of incorporation; or (iii) the modification corrects an inconsistency between the relevant final terms and the relevant termsheet relating to the Notes. The Notes permit the substitution of the Issuer with an affiliate without the consent of any Noteholders where the Issuer provides an irrevocable guarantee of the affiliate's obligations.
Meetings of Noteholders: The Conditions of the Notes contain provisions for calling meetings of Noteholders to consider matters affecting their interests generally. These provisions permit defined majorities to bind all Noteholders including Noteholders who did not attend and vote at the relevant meeting and Noteholders who voted in a manner contrary to the majority.
Taxation: All payments by the Issuer of any amount in respect of the Notes will be made without deduction of any taxes, duties and other similar charges as are imposed by or on behalf of the United Kingdom unless the Issuer is required by law to withhold or deduct any such taxes. In the event that the Issuer is so required by law to withhold or deduct, the Issuer will, subject to certain exceptions as outlined in the Conditions, pay such additional amounts as may be necessary in order that the net amounts received by the Noteholders after such withholding or deduction shall equal the respective amounts which would have been receivable in respect of the Notes in the absence of such withholding or deduction.
Governing Law: The Notes will be governed by English law.
In addition, Noteholders, by their purchase of the Notes, will be deemed to have given certain representations, warranties, undertakings, acknowledgements and agreements.
Application will be made to admit the Notes to the Official List of the United Kingdom Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange plc.
The Notes are direct, unsubordinated and unsecured obligations of the Issuer and not of any other person. If the Issuer's financial position were to deteriorate, there could be a risk that the Issuer would not be able to meet its obligations under the Notes (the Issuer's credit risk), and Noteholders would not be able to enforce security as a method of recouping payments due under the Note. In such worst-case scenario, Noteholders would lose all of their invested amount.
The Notes are not ordinary debt securities and Noteholders are exposed to the risks relating to the Index or Indices. Depending on the performance of the Index or Indices as well as certain other factors (including changes in currency exchange rates, changes in interest rates, time remaining to redemption, economic and market conditions, dividend rates on the securities underlying an Index), Noteholders, upon redemption, may receive less than the amount invested or nothing. Past performance of an Index is not indicative of its future performance.
There may be no active trading market or secondary market liquidity for the Notes and the secondary value of Notes may depend on a number of factors. It is not possible to predict whether any trading market for the Notes will develop or, if it does, the price at which Notes will trade in the secondary market or whether such market will be liquid or illiquid. The value of Notes prior to maturity is expected to depend on a number of factors including, without limitation: (i) the financial condition and funding costs of the Issuer; (ii) the value, volatility and liquidity of an Index; (iii) the time remaining to maturity; (iv) any change(s) in interest rates and dividend yields and inflation rates; (v) any change(s) in currency exchange rates; (vi) economic and market conditions and (vii) any related transaction costs. As a result of these factors the price at which a Noteholder will be able to sell Notes prior to maturity may be less than the initial amount invested. Each of these factors interrelate in complex ways (for example, one factor may offset an increase in the value of the Notes caused by another).
An investment in the Notes is not equivalent to an investment in the securities underlying an Index. Ownership of the Notes does not confer any legal or beneficial interest or any voting or dividend rights in the securities underlying an Index and the value of the Notes may not exactly correlate with the level of an Index.
Disruption Events. Upon the occurrence of certain events (including an early closure of the relevant exchange, disruption of such exchange or suspension of trading on such exchange, an Additional Disruption Event, an Index Cancellation or modification or disruption in the publication of an Index, certain events relating to the administrator(s) of an Index and/or certain events affecting the settlement currency), valuations of an Index may be subject to postponement or adjustment or the terms of the Notes may be subject to adjustment and/or (in certain circumstances) Notes may be subject to early redemption. Any such postponement, adjustment or early redemption may have an adverse effect on the value of such Notes and/or the amount payable to the Noteholder under the Notes on redemption (as applicable). As a result, Noteholders may suffer a loss of some or all of their investments.
Illegality or changes in tax law may cause the Notes to be redeemed early. In such circumstances, the Issuer may pay a sum representing the fair market value of the Notes. As a result, holders of Notes will forgo any future appreciation in the relevant Index or Indices and may suffer a loss of some or all of their investments.
Commission, cost of hedging and taxes may be borne by Noteholders. The issue price of the Notes may include fees, commission and hedging costs. Accordingly, there is a risk that, upon issue, the price of the Notes in the secondary market (if any) would be lower than the original issue price of the Notes. Payments under the Notes may be decreased to take into account the effect of taxes, duties or other similar charges and Noteholders will bear the cost of all taxes, duties or other similar charges payable in connection with the subscription, purchase or holding of such Note and any payments under the Notes (in each case including any taxes or duties imposed or increased by a change of tax law or practice).
An offer of this Tranche of Notes may be made by the Initial Authorised Offeror other than pursuant to Article 1(4) of the UK Prospectus Regulation in the United Kingdom only (the "Public Offer Jurisdiction") during the period from (and including) 12 February 2024 until (but excluding) 8 March 2024 (the "Offer Period"). The Issuer reserves the right to withdraw the offer of the Notes for any reason and at any time prior to the end of the Offer Period. The offer price of the Notes is the issue price. The amount of Notes to be issued shall be determined after the close of the Offer Period, but shall not exceed GBP 25,000,000.
Application will be made by the Issuer for the Notes to be admitted to trading on the Main Market of the London Stock Exchange. No assurance can be given as to whether or not, or when, such application will be granted. The expense of listing is GBP 5,000. Expenses in respect of the listing of Notes are not charged directly by the Issuer or Dealer(s) to the Noteholder.
Please refer to paragraph (c) of Section A entitled "Introduction" above for details of the offeror. The Issuer will apply for admission to trading.
The Prospectus has been prepared in connection with a public offer of Notes and the admission of Notes to trading on a regulated market pursuant to the UK Prospectus Regulation.
Use and Estimated Net Amount of Proceeds: The estimated net amount of proceeds from the issue of Notes will be up to GBP 25,000,000 less any re-offer spread (as described below). The net proceeds will used by the Issuer for profit making or risk hedging purposes.
Conflicts of Interest: The Issuer and/or its affiliates may enter into hedging or other transactions (i) relating to an Index or to securities underlying an Index or (ii) with issuers of securities underlying an Index. The Issuer or its affiliates may also publish research or other reports relating to an Index or securities underlying an Index. Any such activities may have a positive or negative effect on the value of Notes relating to such Index. In undertaking any such activities, neither the Issuer nor any affiliate of the Issuer is under any obligation to consider the interests of the Noteholders. In addition, the Issuer may assume roles as hedging counterparty or calculation agent under the Notes. In respect of any of these roles the Issuer may have interests that conflict with the interests of Noteholders. The Notes may be on-sold by the Dealer to the Initial Authorised Offeror at a discount to the issue price of up to three per cent. Such discount (the "re-offer spread") will be retained by the Initial Authorised Offeror.
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