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2023 Securities:
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HSBC
Securities (USA) Inc. (the "2023
Securities Sole Structuring Adviser and Book Running
Manager")
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ABN
AMRO Securities (USA) LLC
BBVA
Securities Inc.
CIBC
World Markets Corp.
Commerz
Markets LLC
Danske
Markets Inc.
Imperial
Capital, LLC
ING
Financial Markets LLC
Merrill
Lynch, Pierce, Fenner & Smith Incorporated
Morgan
Stanley & Co. LLC
Natixis
Securities Americas LLC
Santander
Investment Securities Inc.
UniCredit
Capital Markets LLC
(together
with the 2023 Securities Sole Structuring Adviser and Book Running
Manager, the "2023 Securities
Managers")
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2028 Securities:
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HSBC
Securities (USA) Inc. (the "2028
Securities Sole Structuring Adviser and Book Running
Manager", and together with
the 2023 Securities Sole Structuring Adviser and Book Running
Manager, the "Securities Sole
Structuring Adviser and Book-Running Manager")
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ABN
AMRO Securities (USA) LLC
BBVA
Securities Inc.
CIBC
World Markets Corp.
Commerz
Markets LLC
Danske
Markets Inc.
Imperial
Capital, LLC
ING
Financial Markets LLC
KBC
Securities USA LLC
Merrill
Lynch, Pierce, Fenner & Smith Incorporated
Morgan
Stanley & Co. LLC
Natixis
Securities Americas LLC
Santander
Investment Securities Inc.
UniCredit
Capital Markets LLC
(together
with the 2028 Securities Sole Structuring Adviser and Book Running
Manager, the "2028 Securities
Managers", and together with the 2023 Securities Manager,
the "Securities
Managers")
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The
Securities Managers' obligations to purchase and pay for the
Securities on the Issue Date are subject to the satisfaction of a
number of conditions as of the time of payment of the Securities
(the "Closing Time"),
including:
(a) the
absence of any stop order suspending the effectiveness of the
Company's registration statement on Form F-3 (or pending or
contemplated proceeding for such purpose);
(b) the
absence of any material adverse change in the financial condition,
earnings or general affairs of the Company and its
subsidiaries;
(c) the
Company's compliance in all material respects with all agreements,
and satisfaction of all conditions, pursuant to the Securities
Terms Agreement and the Securities Indentures;
(d) the
accuracy in all material respects of the representations and
warranties of the Company contained in the Securities Terms
Agreement as of the Closing Time;
(e) the
absence of a downgrade in the rating accorded to the Securities by
certain rating agencies;
(f) the
absence of any change in United States ("US") or United Kingdom ("UK") taxation directly and materially
adversely affecting US purchasers of the Securities or the
imposition of exchange controls by the US or the UK directly and
materially affecting the Company's ability to pay interest or
dividends in US dollars; and
(g) the
timely filing of certain required disclosure documents with the
SEC.
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Issuer
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The
Company
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Aggregate principal amount
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US$2,250,000,000
(or up to US$2,475,000,000 if the Securities Managers'
over-allotment option is exercised in full), with respect to the
2023 Securities.
US$1,750,000,000
(or up to US$1,925,000,000 if the Securities Managers'
over-allotment option is exercised in full), with respect to the
2028 Securities.
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Maturity date
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Perpetual
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Issue price
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100% of
the aggregate principal amount
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Interest
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Interest
on the 2023 Securities will be a rate per annum equal to (i)
6.250%, from (and including) the Issue Date to (but excluding) 23
March 2023 and (ii) the sum of the applicable Mid-Market Swap Rate
on the relevant Reset Determination Date and 3.453%, from (and
including) each 2023 Securities Reset Date to (but excluding) the
next following 2023 Securities Reset Date.
Interest
on the 2028 Securities will be a rate per annum equal to (i)
6.500%, from (and including) the Issue Date to (but excluding) 23
March 2028 and (ii) the sum of the applicable Mid-Market Swap Rate
on the relevant Reset Determination Date and 3.606%, from (and
including) each 2028 Securities Reset Date to (but excluding) the
next following 2028 Securities Reset Date.
The
"Mid-Market Swap Rate" means
the Mid-Market Swap Rate Quotation that appears on Bloomberg page
"ISDA 01" (or such other page as may replace such page on Bloomberg
or such other information service, in each case, as may be
nominated by the person providing or sponsoring the information
appearing on such page for purposes of displaying comparable rates)
(the "relevant screen page")
as of approximately 11:00 am (New York time) on the relevant Reset
Determination Date, all as determined by the calculation
agent.
If no
such rate appears on the relevant screen page for a five-year term,
then the Mid-Market Swap Rate will be determined through the use of
straight-line interpolation by reference to two rates, one of which
will be determined in accordance with the above provisions, but as
if the relevant Reset Period were the period of time for which
rates are available next shorter than the length of the actual
Reset Period and the other of which will be determined in
accordance with the above provisions, but as if the relevant Reset
Period were the period of time for which rates are available next
longer than the length of the actual Reset Period.
If on
any Reset Determination Date the relevant screen page is not
available or the Mid-Market Swap Rate does not appear on the
relevant screen page, the calculation agent will request the
principal office in New York of four major banks in the swap,
money, securities or other market most closely connected with the
relevant Mid-Market Swap Rate (as selected by the Company on the
advice of an investment bank of international repute) (the
"Reference Banks") to
provide it with its Mid-Market Swap Rate Quotation as of
approximately 11:00 a.m. (New York time) on the relevant Reset
Determination Date. If two or more of the Reference Banks provide
the calculation agent with Mid-Market Swap Rate Quotations, the
interest rate for the relevant Reset Period will be the sum of
3.453%, with respect to the 2023 Securities, or 3.606%, with
respect to the 2028 Securities, and the arithmetic mean (rounded,
if necessary, to the nearest 0.001% (0.0005% being rounded
upwards)) of the relevant Mid-Market Swap Rate Quotations, as
determined by the calculation agent. If only one or none of the
Reference Banks provides the calculation agent with a Mid-Market
Swap Rate Quotation, the interest will be determined to be the rate
of interest as of the last preceding Reset Date or, in the case of
the initial Reset Determination Date, 6.250%, with respect to the
2023 Securities, or 6.500%, with respect to the 2028
Securities.
The
"Mid-Market Swap Rate
Quotation" means a quotation (expressed as a
percentage rate per annum) for the mean of the bid and offered
rates for the fixed leg payable semi-annually (calculated on the
basis of twelve 30-day months or, in the case of an incomplete
month, the actual number of days elapsed, in each case assuming a
360-day year) of a fixed-for-floating interest rate swap
transaction in US dollars which transaction (i) has a five-year
term commencing on the relevant Reset Date, (ii) is in an amount
that is representative for a single transaction in the US dollar
swap rate market at 11:00 a.m. (New York time) with an acknowledged
dealer of good credit in the swap market and (iii) has a floating
leg based on six-month LIBOR (calculated on the basis of twelve
30-day months or, in the case of an incomplete month, the actual
number of days elapsed, in each case assuming a 360-day year);
provided that if (a) the Company determines that LIBOR has ceased
to be calculated or administered and (b) the Independent Financial
Adviser, or, if the Company is unable to appoint the Independent
Financial Adviser, the Company (acting in good faith and a
commercially reasonable manner), determines that another rate has
replaced LIBOR in customary market usage for setting rates
comparable to the Mid-Market Swap Rate (the "Alternative Base Rate"), then the
Mid-Market Swap Rate Quotation will be the quotation for the mean
of bid and offered rates determined as provided above but as if the
reference to LIBOR was a reference to the Alternative Base Rate and
with such adjustments (if any) as may in the Company's
determination (after consultation with the Independent Financial
Adviser if appointed as provided for above) be necessary to take
account of any adjustment factor to make such rates comparable to
rates quoted on the basis of LIBOR; provided further that if the
determination of the Alternative Base Rate occurs less than five
business days prior to the relevant Reset Determination Date, the
rate of interest will be as of the last preceding Reset Date or, in
the case of the initial Reset Determination Date, 6.250%, with
respect to the 2023 Securities, or 6.500%, with respect to the 2028
Securities.
The
Company will promptly give notice of the determination of the
Alternative Base Rate and any adjustment factors to the trustee,
the paying agent, the calculation agent and the
securityholders.
By its
acquisition of the Securities, each securityholder (which, for
these purposes, includes each beneficial owner) will acknowledge,
accept, consent and agree to be bound by the Independent Financial
Adviser's or the Company's determination of the Alternative Base
Rate and any adjustment factors applied thereto, including as may
occur without any prior notice from the Company and without the
need for the Company to obtain any further consent from such
securityholder.
"LIBOR"
means the interest rate benchmark known as the London interbank
offered rate, which is calculated and published by a designated
distributor (currently Thomson Reuters) in accordance with the
requirements from time to time of ICE Benchmark Administration
Limited (or any other person which takes over the administration of
that rate) based on estimated interbank borrowing rate for US
dollars that is provided by a panel of contributor
banks.
An
"Independent Financial
Adviser" means an independent financial institution of
international repute or other independent financial adviser
experienced in the international capital markets, in each case
appointed by the Company at its own expense.
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Reset date, reset determination date & reset
period
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With
respect to the 2023 Securities, 23 March 2023, and each fifth
anniversary date thereafter (each, a "2023 Securities Reset
Date").
With
respect to the 2028 Securities, 23 March 2028, and each fifth
anniversary date thereafter (each, a "2028 Securities Reset
Date").
The
"Reset Determination Dates"
shall be the second business day immediately preceding a Reset
Date.
Each
period from (and including) a Reset Date to (but excluding) the
following Reset Date shall be a "Reset Period".
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Interest payment dates
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With
respect to the 2023 Securities, semi-annual on each 23 March and 23
September, commencing 23 September 2018, subject to cancellation or
deemed cancellation as described in the Prospectus
Supplement.
With
respect to the 2028 Securities, semi-annual on each 23 March and 23
September, commencing 23 September 2018, subject to cancellation or
deemed cancellation as described in the Prospectus
Supplement.
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Interest cancellation
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The
Company will have sole and absolute discretion at all times and for
any reason to cancel (in whole or in part) any interest payment
that would otherwise be payable on any interest payment date. In
addition, the terms of the Securities restrict the Company from
making interest payments in certain circumstances, including where
the Company's distributable items or the maximum distributable
amount is exceeded or the Company would not be solvent at the time
of such interest payment or the Relevant Regulator orders the
Company to cancel (in whole or in part) the interest otherwise
payable on such interest payment date, in which case the interest
payment will be deemed to have been cancelled.
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Automatic conversion
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If a
Capital Adequacy Trigger Event occurs, then an Automatic Conversion
will occur without delay (but no later than one month following the
date on which it is determined such Capital Adequacy Trigger Event
has occurred).
An
"Automatic Conversion" is
the irrevocable and automatic release of all of the Company's
obligations under the Securities in consideration of the Company's
issuance of the Conversion Shares to the Conversion Shares
Depository (or to the relevant recipient in accordance with the
terms of the Securities) (on behalf of the securityholders) on the
date on which the Automatic Conversion will take place, or has
taken place, as applicable (such date, the "Conversion Date"), all in accordance
with the terms of the 2023 Securities and the 2023 Securities
Indenture, or the 2028 Securities and the 2028 Securities
Indenture, as applicable.
After a
Capital Adequacy Trigger Event, subject to certain conditions, the
Company expects the Conversion Shares Depository to deliver to the
securityholders on the settlement date (as determined pursuant to
the terms of the Securities Indenture) either (i) Conversion Shares
or (ii) if the Company elects, in its sole and absolute discretion,
that a Conversion Shares Offer be made, the Conversion Shares Offer
Consideration.
"Conversion
Shares Depository" means a financial institution, trust
company, depository entity, nominee entity or similar entity to be
appointed by the Company on or prior to any date when a function
ascribed to the Conversion Shares Depository in the Securities
Indenture, is required to be performed, to perform such functions
and which, as a condition of such appointment, such entity will be
required to undertake, for the benefit of the securityholders, to
hold the Conversion Shares (and any Conversion Shares Offer
Consideration) on behalf of such securityholders in one or more
segregated accounts, unless otherwise required for the purposes of
the Conversion Shares Offer and, in any event, on terms consistent
with the Securities Indenture.
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Conversion shares & conversion price
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"Conversion
Shares" means the Company's ordinary shares (the
"Ordinary Shares") to be
issued to the Conversion Shares Depository (or to the relevant
recipient in accordance with the terms of the Securities) following
an Automatic Conversion, which Ordinary Shares will be in such
number as is determined by dividing the aggregate principal amount
of the Securities outstanding immediately prior to the Conversion
Date by the Conversion Price rounded down, if necessary, to the
nearest whole number of Ordinary Shares.
The
"Conversion Price" is fixed
initially at US$3.7881 and is subject to certain
anti-dilution adjustments as described below.
Assuming
that there is no adjustment to the Conversion Price, the maximum
number of Ordinary Shares that may be issued upon an Automatic
Conversion of the 2023 Securities is 593,965,312 (or up to 653,361,843 Ordinary
Shares if the Securities Managers' over-allotment option is
exercised in full).
Assuming
that there is no adjustment to the Conversion Price, the maximum
number of Ordinary Shares that may be issued upon an Automatic
Conversion of the 2028 Securities is 461,973,020 (or up to 508,170,322 Ordinary
Shares if the Securities Managers' over-allotment option is
exercised in full).
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Ranking of conversion shares:
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The
Conversion Shares issued following an Automatic Conversion will in
all respects rank pari
passu with the fully paid Ordinary Shares in issue on the
Conversion Date, except in any such case for any right excluded by
mandatory provisions of applicable law, and except that the
Conversion Shares so issued will not rank for (or, as the case may
be, the relevant securityholder will not be entitled to receive)
any rights, distributions or payments, the entitlement to which
falls prior to the Conversion Date.
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Capital adequacy trigger event
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A
"Capital Adequacy Trigger
Event" will occur if at any time the End-point CET1 Ratio is
less than 7.0%. Whether a Capital Adequacy Trigger Event has
occurred at any time will be determined by the Company, the
Relevant Regulator or any agent of the Relevant Regulator appointed
for such purpose by the Relevant Regulator.
"End-point
CET1 Ratio" means, as of any date, the ratio of CET1 Capital
to the Risk Weighted Assets, in each case as of such date,
expressed as a percentage.
"CET1
Capital" means, as of any date, the sum, expressed in US
dollars, of all amounts that constitute common equity tier 1
capital of the Company together with its subsidiary undertakings
(the "HSBC Group") as of
such date, less any deductions from common equity tier 1 capital
required to be made as of such date, in each case as calculated by
the Company on a consolidated basis and without applying the
transitional provisions set out in Part Ten of the CRR (or in any
successor provisions thereto or any equivalent provisions of the
Relevant Rules which replace or supersede such provisions) in
accordance with the Relevant Rules applicable to the Company as of
such date (which calculation will be binding on the trustee, the
paying agent and the securityholders). For the purposes of this
definition, the term "common equity tier 1 capital" will have the
meaning assigned to such term in CRD IV (as the same may be amended
or replaced from time to time) as interpreted and applied in
accordance with the Relevant Rules then applicable to the HSBC
Group or by the PRA (or any successor entity primarily responsible
for the Company's prudential supervision (the "Relevant Regulator").
"Risk
Weighted Assets" means, as of any date, the aggregate
amount, expressed in US dollars, of the risk weighted assets of the
HSBC Group as of such date, as calculated by the Company on a
consolidated basis and without applying the transitional provisions
set out in Part Ten of the CRR (or in any successor provisions
thereto or any equivalent provisions of the Relevant Rules which
replace or supersede such provisions) in accordance with the
Relevant Rules applicable to the Company as of such date (which
calculation will be binding on the trustee, the paying agent and
the securityholders). For the purposes of this definition, the term
"risk weighted assets" means the risk weighted assets or total risk
exposure amount, as calculated by the Company in accordance with
the Relevant Rules.
"CRD
IV" means, taken together, (i) the CRR, (ii) the
CRD and (iii) the Capital Instruments
Regulations.
"CRR"
means regulation (EU) No 575/2013 of the European Parliament and of
the Council of June 26, 2013 on prudential requirements for
credit institutions and investment firms and amending regulation
(EU) No 648/2012, as amended, supplemented or replaced from
time to time and (where relevant) any applicable successor EU or UK
legislation.
"CRD"
means Directive 2013/36/EU of the European Parliament and of the
Council of June 26, 2013 on access to the activity of credit
institutions and the prudential supervision of credit institutions
and investment firms, amending Directive 2002/87/EC and repealing
Directives 2006/48/EC and 2006/49/EC as amended, supplemented or
replaced from time to time, and (where relevant) any applicable
successor EU or UK legislation.
"Capital
Instruments Regulations" means any regulatory capital rules,
regulations or standards which are applicable at any time to the
Company (on a solo or consolidated basis and including any
implementation thereof or supplement thereto by the UK Prudential
Regulation Authority (or any successor entity) (the "PRA") from time to time) and which lay
down the requirements to be fulfilled by financial instruments for
inclusion in the Company's regulatory capital (on a solo or
consolidated basis) as may be required by (i) the CRR and/or
(ii) the CRD, including (for the avoidance of doubt) any
delegated acts and implementing acts made by the European
Commission (such as regulatory technical standards and implementing
technical standards) and European Banking Authority guidelines all
as amended from time to time and as implemented in the
UK.
"Relevant
Rules" means, at any time, the laws, regulations,
requirements, guidelines and policies relating to capital adequacy
(including, without limitation, as to leverage) then in effect in
the UK including, without limitation to the generality of the
foregoing, as may be required by CRD IV or Directive 2014/59/EU
establishing a framework for the recovery and resolution of credit
institutions and investment firms, as amended, supplemented or
replaced from time to time ("BRRD"), or any applicable successor
legislation, or any delegated or implementing acts (such as
regulatory technical standards) adopted by the European Commission
and applicable to the Company from time to time and any
regulations, requirements, guidelines and policies relating to
capital adequacy adopted by the Relevant Regulator from time to
time (whether or not such requirements, guidelines or policies are
applied generally or specifically to the Company or to the Company
and any of the Company's holding or subsidiary companies or any
subsidiary of any such holding company).
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Conversion shares offer
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The
Company may elect, at its sole and absolute discretion, that the
Conversion Shares Depository make an offer of all or some of the
Conversion Shares issued in connection with the 2023 Securities or
the 2028 Securities, as applicable, to all or some of the
Company's ordinary shareholders at a cash price per Conversion
Share equal to the Conversion Shares Offer Price, subject to
certain conditions.
The
"Conversion Shares Offer
Price" is fixed initially at £2.70 and is subject to
certain anti-dilution adjustments as described below.
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Conversion shares offer consideration
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"Conversion
Shares Offer Consideration" means in respect of each
Security (i) if all the Conversion Shares are sold in the
Conversion Shares Offer, the pro
rata share of the cash proceeds from such sale attributable
to such Security converted from sterling (or any such other
currency in which the Ordinary Shares are denominated) into US
dollars at the prevailing rate (as calculated pursuant to the
Securities Indenture) as of the date that is three Depository
Business Days prior to the relevant settlement date as determined
by the Conversion Shares Depository (less the pro rata share of any
foreign exchange transaction costs) (the "pro rata cash component"), (ii) if some
but not all of the Conversion Shares are sold in the Conversion
Shares Offer, (x) the pro rata cash component and (y) the pro rata
share of the Conversion Shares not sold pursuant to the Conversion
Shares Offer attributable to such Security rounded down to the
nearest whole number of Conversion Shares, and (iii) if no
Conversion Shares are sold in a Conversion Shares Offer, the
relevant Conversion Shares attributable to such Security rounded
down to the nearest whole number of Conversion Shares, subject in
the case of (i) and (ii)(x) above to deduction from any such cash
proceeds of an amount equal to the pro rata share of any stamp
duty, stamp duty reserve tax, or any other capital, issue,
transfer, registration, financial transaction or documentary tax
that may arise or be paid as a consequence of the transfer of any
interest in the Conversion Shares to the Conversion Shares
Depository (or the relevant recipient in accordance with the terms
of the Securities) in order for the Conversion Shares Depository
(or the relevant recipient in accordance with the terms of the
Securities) to conduct the Conversion Shares Offer.
"Depository
Business Day" means a day on which the Conversion Shares
Depository is open for general business.
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Adjustments to the conversion price and the conversion shares offer
price
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The
Conversion Price and Conversion Shares Offer Price will be adjusted
upon the occurrence of the following events: (i) a consolidation,
reclassification or subdivision of the Ordinary Shares, (ii) an
issuance of Ordinary Shares in certain circumstances by way of
capitalisation of profits or reserves, (iii) certain issues of
rights for the Ordinary Shares, (iv) an Extraordinary Dividend or
(v) a Qualifying Takeover Event, in each case only in the
situations and to the extent provided in the Securities
Indenture.
Adjustments
are not required for every corporate or other event that may affect
the market price of the Conversion Shares and an Independent
Financial Adviser may make modifications as it determines to be
appropriate.
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Optional redemption
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The
Securities will not be redeemable at the option of the
securityholders at any time. The Securities may be redeemed in
whole (but not in part) at the option of the Company in its sole discretion on any
Reset Date at a redemption price equal to 100% of the principal
amount plus any accrued and unpaid interest to (but excluding) the
date of redemption (which interest will exclude any interest that
is cancelled or deemed to have been cancelled), subject to certain
conditions described in the Securities
Indenture.
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Special event redemption
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The
Securities may be redeemed in whole (but not in part) at the option
of the Company upon the
occurrence of a Tax Event or a Capital Disqualification Event,
subject to certain conditions described in the Securities
Indenture. In each case, the redemption price will be equal to 100%
of the principal amount plus any accrued and unpaid interest to
(but excluding) the date of redemption (which interest will exclude
any interest that is cancelled or deemed to have been
cancelled).
A
"Tax Event" will be deemed
to have occurred if at any time the Company determines that certain
detrimental tax events have occurred (as specified in the
Securities Indenture) as a result of a change in, or amendment to,
the laws of the UK or any political subdivision or taxing authority
thereof or therein that has the power to tax, including any treaty
to which the relevant taxing jurisdiction is a party, or a change
in an official application or interpretation of those laws or
regulations on or after the Issue Date, including a decision of any
court or tribunal that becomes effective on or after the Issue
Date.
A
"Capital Disqualification
Event" will be deemed to have occurred if the Company
determines, at any time after the Issue Date, there is a change in
the regulatory classification of the Securities that results or
will result in either their (i) exclusion in whole or in part from
the HSBC Group's regulatory capital (other than as a consequence of
an Automatic Conversion); or (ii) reclassification in whole or in
part as a form of the HSBC Group's regulatory capital that is lower
than additional tier 1 capital.
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Agreement with respect to the exercise of UK bail-in
power
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By its
acquisition of the Securities, each securityholder (which, for
these purposes, includes each beneficial owner) will acknowledge,
accept, consent and agree, notwithstanding any other term of the
Securities, the Securities Indenture, or any other agreements,
arrangements or understandings between the Company and any
securityholder, to be bound by (a) the effect of the exercise of
any UK bail-in power by the relevant UK resolution authority that
may include and result in any of the following, or some combination
thereof: (i) the reduction of all, or a portion, of the Amounts
Due; (ii) the conversion of all, or a portion, of the Amounts Due
into the Company's or another person's ordinary shares, other
securities or other obligations (and the issue to, or conferral on,
the securityholder of such ordinary shares, other securities or
other obligations), including by means of an amendment,
modification or variation of the terms of the Securities or the
Securities Indenture; (iii) the cancellation of the Securities;
and/or (iv) the amendment or alteration of the redemption date of
the Securities or amendment of the amount of interest payable on
the Securities, or the interest payment dates, including by
suspending payment for a temporary period; and (b) the variation of
the terms of the Securities or the Indenture, if necessary, to give
effect to the exercise of any UK bail-in power by the relevant UK
resolution authority. No repayment or payment of Amounts Due will
become due and payable or be paid after the exercise of any UK
bail-in power by the relevant UK resolution authority if and to the
extent such amounts have been reduced, converted, cancelled,
amended or altered as a result of such exercise. Moreover, each
securityholder (which, for these purposes, includes each beneficial
owner) will consent to the exercise of any UK bail-in power as it
may be imposed without any prior notice by the relevant UK
resolution authority of its decision to exercise such power with
respect to the Securities.
For
these purposes, (a) "Amounts
Due" are the principal amount of, and any accrued but unpaid
interest, including any Additional Amounts (as defined in the
Prospectus Supplement), on, the Securities. References to such
amounts will include amounts that have become due and payable, but
which have not been paid, prior to the exercise of any UK bail-in
power by the relevant UK resolution authority; (b) a "UK bail-in power" is any write-down,
conversion, transfer, modification, or suspension power existing
from time to time under, and exercised in compliance with, any
laws, regulations, rules or requirements in effect in the UK,
relating to the transposition of the BRRD or otherwise, including
but not limited to the UK Banking Act 2009 and the instruments,
rules and standards created thereunder, pursuant to which (i) any
obligation of a regulated entity (or other affiliate of such
regulated entity) can be reduced, cancelled, modified, or converted
into shares, other securities, or other obligations of such
regulated entity or any other person (or suspended for a temporary
period); and (ii) any right in a contract governing an obligation
of a regulated entity may be deemed to have been exercised. A
reference to a "regulated entity" is to any BRRD Undertaking as
such term is defined under the PRA Rulebook promulgated by the PRA,
as amended from time to time, which includes certain credit
institutions, investment firms, and certain of their parent or
holding companies, or any comparable future definition intended to
designate entities within the scope of the UK recovery and
resolution regime; and (c) the "relevant UK resolution authority" is any
authority with the ability to exercise a UK bail-in
power.
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Transfers after Suspension Date
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On the
"Suspension Date" (as
determined pursuant to the terms of the Securities Indenture
and which will be no later than 38 business days after the delivery
of the Company's notice to DTC specifying whether to conduct the
Conversion Shares Offer), the Depository Trust Company
("DTC") will block all
positions relating to the Securities, which will suspend all
clearance and settlement of transactions in the Securities through
DTC. As a result, the securityholders will not be able to settle
the transfer of any Securities through DTC following the Suspension
Date, and any sale or other transfer of the Securities that a
securityholder may have initiated prior to the Suspension Date that
is scheduled to settle after the Suspension Date will be rejected
by DTC and will not be settled through DTC. Moreover, the
Securities may cease to be admitted to the Irish Stock Exchange's
Official List and to be traded on the GEM after the Suspension
Date.
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Form & denominations
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The
Securities will be issued in the form of one or more global
securities registered in the name of the nominee for, and deposited
with, DTC.
The
denominations of the Securities will be US$200,000 and integral
multiples of US$1,000 in excess thereof.
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Status
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The
Securities will constitute the Company's direct, unsecured and
subordinated obligations, ranking equally without any preference
among themselves. The Securities will be subordinated to the claims
of Senior Creditors.
"Senior
Creditors" means the Company's creditors (i) who are
unsubordinated creditors; (ii) whose claims are, or are expressed
to be, subordinated to the claims of the Company's unsubordinated
creditors but not further or otherwise; or (iii) whose claims are,
or are expressed to be, junior to the claims of the Company's other
creditors, whether subordinated or unsubordinated, other than those
whose claims rank, or are expressed to rank, pari passu with, or junior to, the
claims of the securityholders in a winding-up occurring prior to a
Capital Adequacy Trigger Event. For the avoidance of doubt, holders
of any of the Company's existing or future Tier 2 capital
instruments will be Senior Creditors. For the avoidance of doubt,
as of the Issue Date, the 2023 Securities and the 2028 Securities
will rank pari passu
with one another.
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Listing
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Application
is expected to be made to the Irish Stock Exchange for the
Securities to be admitted to the Official List and to trading on
the GEM.
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As at 15 March 2018
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(a) Assuming the Securities (excluding the Over-allotment
Securities) are fully converted into Ordinary Shares at the
initial Conversion Price
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(b) Assuming the Securities (including all Over-allotment
Securities) are fully converted into Ordinary Shares
at
the initial Conversion
Price
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|||||
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Name of
Shareholders
|
Number of Ordinary
Shares
|
% of total issued
Ordinary
Shares
|
Number of Ordinary
Shares
|
% of the enlarged issued Ordinary Shares
|
Number of Ordinary
Shares
|
% of the enlarged issued Ordinary Shares
|
|
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|
|
|
|
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|
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|
|
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Ping An
Asset Management Co., Ltd. Note 1
|
1,253,254,972
|
6.25
|
1,253,254,972
|
5.94
|
1,253,254,972
|
5.91
|
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BlackRock,
Inc. Note
2
|
1,388,990,917
|
6.93
|
1,388,990,917
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6.58
|
1,388,990,917
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6.55
|
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Subscribers
of the Securities
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0
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0
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1,055,938,332
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5.00
|
1,161,532,165
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5.48
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Other
public Shareholders
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17,410,539,331
|
86.82
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17,410,539,331
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82.48
|
17,410,539,331
|
82.07
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Total Issued Ordinary Shares
|
20,052,785,220
|
100
|
21,108,723,552
|
100
|
21,214,317,385
|
100.00
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Investor enquiries to:
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UK -
Greg Case
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Tel: +44 (0) 20 7992 3825
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Hong
Kong - Hugh Pye
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Tel: +852 2822 4908
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Media enquiries to:
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UK -
Heidi Ashley
|
Tel:
+44 (0) 20 7992 2045
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HK -
Gareth Hewett
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Tel:
+852 2822 4929
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HSBC
Holdings plc
|
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By:
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Name:
Ben J S Mathews
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Title:
Group Company Secretary
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Date:
20 March 2018
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