DFDS Dover Pitch Deck
Risk Factors
Risks related to the bonds (continued)
The Company may not be able to finance a put option redemption
The Bond Terms will require the Company to make an offer to repurchase the Bonds at 100% of their aggregate principal amount plus accrued interest if the Company experiences certain change of control event (a bondholder put option). The
Company's failure to effect a put option when required would constitute an event of default under the Bond Terms. In addition, the Company's ability to repurchase the Company's as may be required by the Bond Terms will depend on the Group's
access to funds at such time. It cannot be assured that there will be sufficient funds available to make these repayments and repurchases of tendered Bonds.
An active trading market may not develop for the Bonds, in which case bondholders may not be able to resell the Bonds
There is no existing trading market for the Bonds and the Company cannot assure that an active or liquid trading market will develop for the Bonds. No market-making agreement has been made for the Bonds. Future liquidity will depend, among
other things, on the number of bondholders, the Group's financial performance, the market for similar securities and the interest of securities dealers in making a market in the Bonds. In addition, changes in the overall market for debt securities and
changes in the Group's financial performance or in the markets where it operates may adversely affect the liquidity of the trading market in the Bonds and the market price quoted for the Bonds. As a result, the Company cannot assure that an
active trading market will actually develop for the Bonds. The market for the Bonds may further be subject to disruptions that can cause substantial volatility in their prices. Any disruptions may have an adverse effect on the holders of the Bonds.
The Company's credit rating and the Bonds expected credit rating, may not reflect all risks, is not a recommendation to buy or hold securities and may be subject to revision, suspension or withdrawal at any time
One or more independent credit rating agencies may assign credit ratings to the Bonds. The ratings may not reflect the potential impact of all risks related to the structure, market, additional risk factors discussed herein and other factors that may
affect the value of the Bonds. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal by the rating agency at any time. No assurance can be given that a credit rating will
remain constant for any given period of time or that a credit rating will not be lowered or withdrawn entirely by the credit rating agency if, in its judgment, circumstances in the future so warrant. A suspension, reduction or withdrawal at any time
of the credit rating assigned to the Bonds by one or more of the credit rating agencies may adversely affect the Group's access to capital, the cost and terms and conditions of its financings and the value and trading of the Bonds, which could have
a material adverse effect on the Group's business, financial condition and results of operations.
Risks related to amendments of the Bond Terms and remedies afforded to the bondholders
The Bond Terms will contain provisions for calling meetings of bondholders to consider matters affecting their interests generally. These provisions permit defined majorities to bind all bondholders, including bondholders who did not attend nor
vote at the relevant meeting and bondholders who voted in a manner contrary to the majority. The bond trustee may agree, without the consent of the bondholders, to certain modifications to the Bond Terms and other bond finance documents.
Pursuant to the Bond Terms, remedies afforded to the bondholders are vested with the bond trustee, thus preventing individual bondholders from taking separate action. The Bond Trustee will be required to act in accordance with instruction given
by a relevant majority of bondholders, but is also vested with discretionary powers.
Further, remedies available to the bond trustee may be limited by laws relating to liquidation, administration, reconstruction, insolvency or other laws or procedures generally affecting the enforcement of creditors' rights, as well as any provisions
generally applicable under applicable law.
Risks related to the interest on the Bonds
The bonds can be subject to a floating interest rate. The coupon payments, which depend on the NIBOR interest rate and the applicable margin, will vary in accordance with variability of the NIBOR interest rate. The interest rate risks related to part
of the Bond issues will be limited since the coupon rate, where applicable, will be adjusted quarterly according to the change in reference interest rate (NIBOR 3 months). The primary risk for a floating bond issue will be related to the market view
of the correct trading level for the credit spread related to a bond issue at a certain time during the tenor, compared with the credit margin which that bond is carrying. A possible increase in the credit spread trading level relative to the coupon
defined credit margin may relate to general changes in the market conditions and/or Group specific circumstances. However, under normal circumstances the anticipated tradable credit spread will fall as the duration of a bond issue becomes
shorter. In general, the price of bonds will fall when the credit spreads in the market increase, and conversely the bond price will increase when market spreads decrease.
Reference rate benchmarks such as NIBOR may be discontinued over time. In case NIBOR is discontinued while the bonds remain outstanding, the bond trustee for the Bonds will adjust the interest rate in respect of the bonds for the remaining term
of the bonds. The bonds may accordingly pay an interest rate after any such discontinuation and adjustment which may be higher or lower than in case such discontinuation and adjustment had not happened.
An investment in bonds which pay a fixed rate of interest involves the risk that if the market interest rates subsequently increase above the fixed rate paid on such bonds, this will adversely affect the value of such bonds.
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