Prospectus dated 25 May 2018

Transcription

1 Prospectus dated 25 May 2018 SOCIETE FONCIERE LYONNAISE 500,000, per cent. Notes due 29 May 2025 Issue Price: per cent. This document constitutes a prospectus (the Prospectus) for the purposes of Article 5.3 of Directive 2003/71/EC of the European Parliament and the Council dated 4 November 2003, as amended (the Prospectus Directive). Application has been made to the Autorité des marchés financiers (AMF) for approval of this Prospectus in its capacity as competent authority pursuant to Article of its Règlement Général which implements the Prospectus Directive. The 500,000, per cent. notes of Société Foncière Lyonnaise (the Issuer) maturing 29 May 2025 (the Notes) will be issued on 29 May Interest on the Notes will accrue from, and including, 29 May 2018 at the rate of per cent. per annum, payable annually in arrear on 29 May in each year, and for the first time on 29 May 2019 for the period from, and including, 29 May 2018 to, but excluding, 29 May Unless previously redeemed or purchased and cancelled, in accordance with the terms and conditions of the Notes, the Notes will be redeemed at par on 29 May 2025 (the Maturity Date). The Issuer may, at its option (i) from and including 29 February 2025 to but excluding the Maturity Date, redeem the Notes outstanding, in whole or in part, at par plus accrued interest, in accordance with the provisions set out in Condition 6(d) of the Terms and Conditions of the Notes "Residual Maturity Call Option by the Issuer"; (ii) redeem the Notes, in whole or in part, at any time or from time to time, prior to their Maturity Date, in accordance with the provisions set out in Condition 6(c) of the Terms and Conditions of the Notes "Make Whole Redemption by the Issuer" and (iii) redeem the Notes, in whole but not in part, at any time prior to their Maturity Date, if 80 per cent. of the Notes have been redeemed or purchased and cancelled, in accordance with the provisions set out in Condition 6(e) of the Terms and Conditions of the Notes Clean-Up Call Option". The Notes may also, and in certain circumstances shall, be redeemed before the Maturity Date, in whole only but not in part, at par, together with, if applicable, accrued interest, notably in the event of any change in taxation as described under Condition 8 of the Terms and Conditions of the Notes "Taxation" or if any event occurs as described under Condition 10 of the Terms and Conditions of the Notes "Events of default". In addition, in the event of the occurrence of a Restructuring Event, Noteholders will be entitled to request the Issuer to redeem their Notes at their principal amount together with, as the case may be, any accrual interest, all as defined and in accordance with Condition 6(f) of the Terms and Conditions of the Notes "Redemption at the option of the Noteholders". The Notes will be issued in dematerialised bearer form in the denomination of 100,000. Title to the Notes will be evidenced by book entries in accordance with Articles L et seq. and R of the French Code monétaire et financier. No physical document of title (including certificats représentatifs pursuant to Article R of the French Code monétaire et financier) will be issued in respect of the Notes. The Notes will, upon issue, be inscribed on 29 May 2018 in the books of Euroclear France which shall credit the accounts of the Account Holders. Account Holders shall mean any intermediary institution entitled to hold, directly or indirectly, accounts on behalf of its customers with Euroclear France, Clearstream Banking S.A. and Euroclear Bank S.A./N.V. Application will be made for the Notes to be admitted to trading on the regulated market (within the meaning of directive 2014/65/EU as amended) of Euronext Paris S.A (Euronext Paris). The Notes have been rated BBB+ by Standard & Poor's Rating Services, a division of the McGraw-Hill Companies, Inc. At the date of this Prospectus, the long-term corporate rating of the Issuer assigned by Standard & Poor s Rating Services, a division of the McGraw- Hill Companies, Inc. is BBB+ with a stable outlook. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, change or withdrawal at any time by the assigning rating agency. At the date of this Prospectus, Standard & Poor s Rating Services is established in the European Union, registered under Regulation (EC) No. 1060/2009 of the European Parliament and of the Council dated 16 September 2009, as amended (the CRA Regulation) and included in the list of registered credit rating agencies published by the European Securities and Markets Authority on its website ( in accordance with CRA Regulation. See the "Risk Factors" section for a description of certain factors which should be considered by potential investors in connection with any investment in the Notes. This Prospectus is available free of charge on the websites of the Issuer ( and of the AMF ( BNP Paribas Joint Bookrunners Crédit Agricole CIB HSBC Natixis Société Générale Corporate & Investment Banking 1

2 The Issuer, having made all reasonable enquiries, confirms that, to the best of its knowledge, this Prospectus contains or otherwise incorporates by reference all information with respect to the Issuer, the Issuer and its consolidated subsidiaries taken as a whole (the Group) as well as the Notes which is relevant in the context of the issue and offering of the Notes, that such information is in accordance with the facts and contains no omission likely to affect its import. The Issuer accepts responsibility accordingly. None of BNP Paribas, Crédit Agricole Corporate and Investment Bank, HSBC Bank plc, Natixis and Société Générale (together, the Joint Bookrunners or the Managers) have separately verified the information contained or incorporated by reference in this Prospectus. The Managers do not make any representation, express or implied, or accept any responsibility, with respect to the accuracy or completeness of any of the information contained or incorporated by reference in this Prospectus. Neither this Prospectus nor any other information supplied in connection with the offering of the Notes is intended to provide the basis of any credit or other evaluation and should not be considered as a recommendation by any of the Issuer or the Managers that any recipient of this Prospectus or any other financial statements should purchase the Notes. Neither this Prospectus nor any other information supplied in connection with the offering of the Notes constitutes an offer of, or an invitation by (or on behalf of), any of the Issuer or the Managers to subscribe or purchase any of the Notes. No person is authorised to give any information or to make any representation related to the issue or to the sale of the Notes not contained in this Prospectus. Any information or representation not so contained herein must not be relied upon as having been authorised by or on behalf of the Issuer or the Managers. The delivery of this Prospectus or any sale of Notes at any time does not imply (i) that there has been no change with respect to the Issuer or the Group since the date hereof and (ii) that the information contained or incorporated by reference in it is correct as at any time subsequent to its date. The Prospectus and any other information relating to the Issuer or the Notes are not intended to constitute any credit or other evaluation of the financial position of the Issuer or of the Notes and should not be considered as a recommendation by any of the Issuer or the Managers to purchase the Notes. Each prospective investor of Notes should determine for itself the relevance of the information contained in this Prospectus and its purchase of Notes should be based upon such investigation as it deems necessary. None of the Managers undertakes to review the financial or general condition of the Issuer during the life of the arrangements contemplated by this Prospectus nor to advise any investor or prospective investor in the Notes of any information coming to its attention. Investors should review, inter alia, the documents incorporated by reference into this Prospectus when deciding whether or not to subscribe for or to purchase the Notes. Investors should in particular conduct their own analysis and evaluation of risks relating to the Issuer, its business, its financial condition and the issued Notes and consult their own financial or legal advisers about risks associated with investing in the Notes and the suitability of investing in the Notes in light of their particular circumstances. Potential investors should read carefully the section entitled "Risk Factors" set out in this Prospectus before making a decision to invest in the Notes. The distribution of this Prospectus and the offering or the sale of the Notes in certain jurisdictions may be restricted by law or regulation. The Issuer and the Managers do not represent that this Prospectus may be lawfully distributed, or that any Notes may be lawfully offered, in compliance with any applicable registration or other requirements in any such jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for facilitating any such distribution or offering. In particular, no action has been taken by the Issuer or any of the Managers which is intended to permit a public offering of any Notes or distribution of this Prospectus in any jurisdiction where action for that purpose is required. Accordingly, no Note may be offered or sold, directly or indirectly, and neither this Prospectus nor any offering material may be distributed or published in any jurisdiction, except under circumstances that will result in compliance with any applicable laws and regulations. Persons into whose possession this Prospectus comes are required by the Issuer and the Managers to inform themselves about and to observe any such restrictions. For a further description of certain restrictions on offers and sales of Notes and distribution of this Prospectus and of any other offering material relating to the Notes, see section "Subscription and Sale" below. The Notes have not been and will not be registered under the U.S. Securities Act of 1933 as amended (the Securities Act). In accordance with U.S. laws, and subject to certain exceptions, the Notes may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S. Persons, both as defined in Regulation S under the Securities Act (the Regulation S). This Prospectus is for distribution only to persons who (i) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2

3 2005 (as amended, the Financial Promotion Order), (ii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Financial Promotion Order, (iii) are outside the United Kingdom, or (iv) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as relevant persons). This Prospectus is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this Prospectus relates is available only to relevant persons and will be engaged in only with relevant persons. 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); or (ii) a customer within the meaning of Directive 2002/92/EC, as amended, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II. 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. MIFID II PRODUCT GOVERNANCE / PROFESSIONAL INVESTORS AND ELIGIBLE COUNTERPARTIES ONLY TARGET MARKET Solely for the purposes of each manufacturer s product approval process, the target market assessment in respect of the Notes, taking into account the five categories referred to in item 18 of the Guidelines on MiFID II product governance requirements published by ESMA dated 5 February 2018, has led to the conclusion that: (i) the target market for the Notes is eligible counterparties and professional clients only, each as defined in MiFID II; and (ii) all channels for distribution of the Notes to eligible counterparties and professional clients are appropriate. Any person subsequently offering, selling or recommending the Notes (a Distributor) should take into consideration the manufacturers target market assessment; however, a Distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the Notes (by either adopting or refining the manufacturers target market assessment) and determining appropriate distribution channels. In this Prospectus, references to, EURO, EUR or to euro are to the lawful currency of the member states of the European Union that adopt the single currency in accordance with the Treaty establishing the European Community (signed in Rome on 25 March 1957), as amended by the Treaty on European Union (signed in Maastricht on 7 February 1992) and as amended by the Treaty of Amsterdam (signed in Amsterdam on 2 October 1997). 3

4 TABLE OF CONTENTS Page RISK FACTORS... 5 DOCUMENTS INCORPORATED BY REFERENCE TERMS AND CONDITIONS OF THE NOTES USE OF PROCEEDS DESCRIPTION OF THE ISSUER RECENT DEVELOPMENTS TAXATION SUBSCRIPTION AND SALE GENERAL INFORMATION PERSON RESPONSIBLE FOR THE INFORMATION CONTAINED IN THE PROSPECTUS

5 RISK FACTORS The following are certain risk factors relating to the offering of the Notes of which prospective investors should be aware. Prior to making an investment decision, prospective investors should consider carefully all the information set out in this Prospectus, including in particular the risk factors detailed below, and consult with their own financial and legal advisors as to the risks entailed by an investment in the Notes. The following statements are not exhaustive. In addition, investors should be aware that the risks described may be combined and thus interrelated with one another. Prospective investors should make their own independent evaluations of all investment considerations and should also read the detailed information set out elsewhere in this Prospectus. Terms defined in the section "Terms and Conditions of the Notes" of this Prospectus shall have the same meaning where used below. 1. Risks relating to the Issuer Risks factors linked to Société Foncière Lyonnaise as Issuer, include: liquidity risk, counterparty risk, currency risk, interest rate risk, risk relating to changes in the economic environment and the property market, asset valuation risks, risk associated with a highly competitive property investment market, risks associated with tenants, risks associated with the availability and cost of financing, risk associated with the loss of key personnel, risks associated with subcontractors and other service providers, risks associated with the regulatory environment, risks associated with government-related procedures, risks associated with neighbour complaints, risks associated with the majority shareholder, risks associated with the SIIC tax regime, and financial risks linked to the effects of climate change. Risks factors linked to the Issuer and its activity are described in pages 12 to 17 of the 2017 Reference Document of the Issuer which are incorporated by reference herein. 2. Risks linked to the Notes (a) Investors Potential investors should: be experienced with respect to transactions on capital markets and notes and should understand the risks of transactions involving the Notes; 5

6 reach an investment decision only after careful consideration of the information set forth in this Prospectus and general information relating to Notes; ensure that they have sufficient financial resources to bear the risks of purchase of the Notes; have sufficient knowledge of the nature of Notes, the merits and risks of investing in the relevant Notes and verify the suitability of such investment in light of their particular financial situation; and make their own assessment of the legal, tax, accounting and regulatory aspects of purchasing the Notes. Each potential investor should consult its legal advisers on legal, tax and related aspects of investment in the Notes. A prospective investor may not rely on the Issuer or the Managers or any of their respective affiliates in connection with its determination as to the legality and suitability of its acquisition of the Notes or as to the other matters referred to above. Potential investors should be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for economic and other factors that may affect their investment and their ability to bear the applicable risks. Some potential investors are subject to restricting investment regulations. These potential investors should consult their legal counsel in order to determine whether investment in the Notes is authorised by law, whether such investment is compatible with their other borrowings and whether other selling restrictions are applicable to them. Legality of Purchase Neither the Issuer, the Managers nor any of their respective affiliates has or assumes responsibility for the lawfulness of the subscription or acquisition of the Notes by a prospective investor in the Notes, whether under the laws of the jurisdiction of its incorporation or the jurisdiction in which it operates (if different), or for compliance by that prospective investor with any law, regulation or regulatory policy applicable to it. (b) Risks related to the Notes generally The Notes may be redeemed prior to maturity In the event that the Issuer would be obliged to pay additional amounts in respect of any Notes due to any withholding as provided in Condition 8 of the Terms and Conditions of the Notes "Taxation", the Issuer may and, in certain circumstances shall, redeem all of the Notes then outstanding in accordance with such Condition. In addition, the Issuer may, at its option (i) from and including 29 February 2025 to but excluding the Maturity Date, redeem the Notes outstanding, in whole or in part, at par plus accrued interest, as provided in Condition 6(d) of the Terms and Conditions of the Notes, (ii) redeem, in whole or in part, the then outstanding Notes at any time prior to the Maturity Date, at the relevant make whole redemption amount, as provided in Condition 6(c) of the Terms and Conditions of the Notes and (iii) redeem the Notes, in whole but not in part, at any time prior to their Maturity Date, if 80 per cent. of the Notes have been redeemed or purchased and cancelled, in accordance with the provisions set out in Condition 6(e) of the Terms and Conditions of the Notes (the Clean-Up call Option). In connection with the Clean-Up Call Option, there is no obligation under the Terms and Conditions of the Notes for the Issuer to inform investors if and when this percentage has been reached or is about to be reached, and the Issuer s right to redeem will exist notwithstanding that immediately prior to the serving of a notice in respect of the exercise of this option, the Notes may have been trading significantly above par, thus potentially resulting in a loss of capital invested. Moreover, the Issuer may choose to redeem the Notes at times when prevailing interest rates may be relatively low. In such circumstances an investor may not be able to reinvest the redemption proceeds in a comparable security at an effective interest rate as high as that of the relevant Notes. The price at which a Noteholder will be able to sell the Notes prior to maturity may be at a discount, which could be substantial, from the issue price or the purchase price paid by such purchaser. 6

7 Both the Make Whole Redemption by the Issuer and the Residual Maturity Call Option by the Issuer are exercisable in whole or in part and exercise of the Make Whole Redemption by the Issuer and the Residual Maturity Call Option by the Issuer in respect of certain Notes may affect the liquidity of the Notes in respect of which such option is not exercised Both the Make Whole Redemption by the Issuer provided in Condition 6(c) of the Terms and Conditions of the Notes and the Residual Maturity Call Option by the Issuer provided in Condition 6(d) of the Terms and Conditions of the Notes are exercisable in whole or in part. If the Issuer decides to redeem the Notes in part, such partial redemption may be effected, at the option of the Issuer, either by (i) reducing the nominal amount of all such Notes in proportion to the aggregate nominal amount redeemed or (ii) redeeming in full only some of the Notes or (iii) any other means permitted by applicable laws. Depending on the proportion of the principal amount of all of the Notes so reduced or the number of Notes redeemed, any trading market in respect of those Notes in respect of which such option is not exercised may become illiquid. Modification of the Terms and Conditions of the Notes and Waivers The Terms and Conditions of the Notes contain provisions for collective decisions to consider matters affecting their interests generally to be adopted either through a general meeting (the General Meeting) or by consent following a consultation in writing (the Consultation in Writing). These provisions permit in certain cases defined majorities to bind all Noteholders including Noteholders who did not participate in the relevant General Meeting or Consultation in Writing and Noteholders who voted in a manner contrary to the majority. General Meetings or Consultations in Writing may deliberate on any proposal relating to the modification of the conditions of the Notes subject to the limitation provided by French law. Purchases by the Issuer in the open market or otherwise (including by tender offer) in respect of certain Notes may affect the liquidity of the Notes which have not been so purchased Depending on the number of Notes purchased by the Issuer as provided in Condition 6(h) of the Terms and Conditions of the Notes, any trading market in respect of the Notes that have not been so purchased may become illiquid. A Noteholder s actual yield on the Notes may be reduced from the stated yield by transaction costs When Notes are purchased or sold, several types of incidental costs (including transaction fees and commissions) are incurred in addition to the current price of the security. These incidental costs may significantly reduce or even exclude the profit potential of the Notes. For instance, credit institutions as a rule charge their clients for own commissions which are either fixed minimum commissions or pro-rata commissions depending on the order value. To the extent that additional domestic or foreign parties are involved in the execution of an order, including but not limited to domestic dealers or brokers in foreign markets, Noteholders must take into account that they may also be charged for the brokerage fees, commissions and other fees and expenses of such parties (third party costs). In addition to such costs directly related to the purchase of securities (direct costs), Noteholders must also take into account any follow-up costs (such as custody fees). Investors should inform themselves about any additional costs incurred in connection with the purchase, custody or sale of the Notes before investing in the Notes. Credit Risk of the Issuer The value of the Notes will depend on the creditworthiness of the Issuer. If such creditworthiness deteriorates, the value of the Notes may decrease and investors may then lose all or part of their investment. Change of Control In the event of the occurrence of a Restructuring Event and pursuant to the occurrence of certain events (as more fully described in Condition 6(f) of the Terms and Conditions of the Notes "Redemption at the option of the Noteholders"), each Noteholder will have the right to request the Issuer to redeem the Notes held by him at their principal amount together with any accrued interest. In such case, any trading market in respect of those Notes in respect of which such redemption right is not exercised may become illiquid. In addition, investors may not be able to reinvest the moneys they receive upon such early redemption in securities with the same yield as the redeemed Notes. Change of law The Terms and Conditions of the Notes are based on French law in effect as at the date of this Prospectus. No assurance can be given as to the impact of any possible judicial or administrative decision or change to the laws of France or 7

8 administrative practice or the official application or interpretation of French law after the date of this Prospectus. Furthermore, the Issuer operates in a heavily regulated environment and has to comply with extensive regulations in France and elsewhere. No assurance can be given as to the impact of any possible judicial decision or change to laws or administrative practices after the date of this Prospectus. Taxation Potential purchasers and sellers of the Notes should be aware that they may be required to pay taxes or documentary charges or duties in accordance with the laws and practices of the jurisdiction where the Notes are transferred or other jurisdictions. In some jurisdictions, no official statements of the tax authorities or court decisions may be available for financial notes such as the Notes. Potential investors are advised not to rely upon the tax overview contained in this Prospectus but to ask for their own tax adviser's advice on their individual taxation with respect to the acquisition, holding, disposal and redemption of the Notes. Only these advisors are in a position to duly consider the specific situation of the potential investor. This investment consideration has to be read in connection with the taxation sections of this Prospectus. The proposed financial transaction tax (the FTT) On 14 February 2013, the European Commission published a proposal (the Commission s Proposal) for a Directive for a common FTT in Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia (the participating Member States). In March 2016, Estonia indicated its withdrawal from the enhanced cooperation. The Commission s Proposal has very broad scope and could, if introduced, apply to certain dealings in the Notes (including secondary market transactions) in certain circumstances. Under the Commission s Proposal the FTT could apply in certain circumstances to persons both within and outside of the participating Member States. Generally, it would apply to certain dealings in the Notes where at least one party is a financial institution, and at least one party is established in a participating Member State. A financial institution may be, or be deemed to be, "established" in a participating Member State in a broad range of circumstances, including (a) by transacting with a person established in a participating Member State or (b) where the financial instrument which is subject to the dealings is issued in a participating Member State. However, the FTT proposal remains subject to negotiation between the participating Member States. It may therefore be altered prior to any implementation, the timing of which remains unclear. Additional EU Member States may decide to participate and/or participating Member States may decide to withdraw. Prospective holders of the Notes are advised to seek their own professional advice in relation to the FTT. French Insolvency Law The Issuer is incorporated under the laws of France. Accordingly, any insolvency proceedings with respect to the Issuer or its French subsidiaries would likely be carried out under the laws of France, including Article of the French Code civil and laws relating to conciliation procedure (procédure de conciliation) and safeguard procedure, accelerated financial safeguard procedure, accelerated safeguard procedure, judicial reorganization or liquidation proceedings (procédure de sauvegarde, procédure de sauvegarde financière accélérée, procédure de sauvegarde accélérée, redressement or liquidation judiciaire). Certain provisions of insolvency laws in France are less favourable to creditors than are the bankruptcy laws of other countries. In general, French reorganization or liquidation legislation favours the continuation of a business and protection of employment over the payment of creditors. Pursuant to Article of the French Code civil, French courts may, in a civil proceeding involving a debtor, defer or otherwise reschedule over a maximum period of two years the payment dates of payment obligations. In addition, pursuant to Article of the French Code civil, French courts may decide that any amounts, the payment date of which is thus deferred or rescheduled, will bear interest at a rate which is lower than the contractual rate (but not lower than the legal rate) or that payments made shall first be allocated to repayment of the principal. As a general rule, creditors whose debts arose prior to the commencement of bankruptcy proceedings must file a claim with the creditors representative within certain periods (which may depend on the domicile of the creditor) of the publication of the court order commencing bankruptcy proceedings (safeguard procedure, accelerated financial safeguard procedure, judicial reorganization or liquidation proceeding). Creditors who have not submitted their claims 8

9 during this period are barred from receiving distributions made in connection with the bankruptcy proceedings and their unasserted claims will be unenforceable against the debtor both during and following the implementation of the continuation plan, provided the debtor has complied with the plan s terms. French courts may order that the date on which the company became unable to pay its debts as they came due be deemed to be an earlier date of up to eighteen (18) months prior to the order commencing bankruptcy proceedings (report de la date de cessation des paiements). This date marks the beginning of a suspect period (période suspecte) during which certain transactions that are entered into may be voided. In addition, from the date of the court order commencing bankruptcy proceedings, the debtor is prohibited from paying debts outstanding prior to the court order, subject to limited exceptions. Contractual provisions that would accelerate the payment of the debtor s obligations upon the occurrence of certain bankruptcy events, such as those contained in the Terms and Conditions of the Notes, may be subject to an automatic stay of payment under French law applicable to debts outstanding at the time of commencement of bankruptcy proceedings. Under French insolvency law, holders of debt securities are automatically grouped into a single assembly of holders (the Assembly) in order to defend their common interests if a safeguard procedure (procédure de sauvegarde), an accelerated financial safeguard procedure (procédure de sauvegarde financière accélérée), an accelerated safeguard procedure (procédure de sauvegarde accélérée) or a judicial reorganisation procedure (procédure de redressement judiciaire) is opened in France with respect to the Issuer. The Assembly comprises holders of all debt securities issued by the Issuer (including the Notes), whether or not under a debt issuance programme and regardless of their governing law. The Assembly deliberates on the proposed safeguard plan (projet de plan de sauvegarde), accelerated financial safeguard plan (plan de sauvegarde financière accélérée), accelerated safeguard plan (plan de sauvegarde accélérée) or judicial reorganisation plan (projet de plan de redressement judiciaire) applicable to the Issuer and may further agree to: increase the liabilities (charges) of holders of debt securities (including the Noteholders) by rescheduling payments which are due and/or partially or totally writing-off debts; establish an unequal treatment between holders of debt securities (including the Noteholders) as appropriate under the circumstances; and/or decide to convert debt securities (including the Notes) into securities that give or may give right to share capital. Decisions of the Assembly will be taken by a two-third (2/3rd) majority (calculated as a proportion of the debt securities held by the holders casting a vote at the Assembly). No quorum is required to hold the Assembly. The procedures, as described above or as they will or may be amended, could have an adverse impact on holders of the Notes seeking repayment in the event that the Issuer or its subsidiaries were to become insolvent. For the avoidance of doubt, the provisions relating to the Representation of the Noteholders described in the Terms and Conditions of the Notes set out in this Prospectus will not be applicable to the extent they conflict with compulsory insolvency law provisions that apply in these circumstances. Credit Rating may not reflect all risks The Notes are rated BBB+ by Standard & Poor's Rating Services, a division of the McGraw-Hill Companies, Inc.. The rating may not reflect the potential impact of all risks related to structure, market, additional factors discussed above, and other factors that may affect the value of the Notes. At the date of this Prospectus, the long-term corporate rating of the Issuer assigned by Standard & Poor s Rating Services, a division of the McGraw-Hill Companies, Inc. is BBB+ with a stable outlook. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, change or withdrawal at any time by the assigning rating agency. At the date of this Prospectus, Standard & Poor s Rating Services is established in the European Union, registered under Regulation (EU) No. 1060/2009 of the European Parliament and of the Council dated 16 September 2009, as amended (the CRA Regulation) and included in the list of registered credit rating agencies published by the European Securities and Markets Authority on its website ( in accordance with CRA Regulation. 9

10 (c) Risks related to the market generally Market value of the Notes The market value of the Notes will be affected by the creditworthiness of the Issuer and a number of additional factors, including market interest and yield rates. The value of the Notes depends on a number of interrelated factors, including economic, financial and political events in France or elsewhere, including factors affecting capital markets generally and the stock exchange on which the Notes are traded. The price at which a Noteholder will be able to sell the Notes may be at a discount, which could be substantial, from the issue price or the purchase price paid by such purchaser. No active secondary market for the Notes An investment in the Notes should be considered primarily with a view to holding them until their maturity. Notes may have no established trading market when issued, and one may never develop. If a market does develop, it may not be liquid. Therefore, investors may not be able to sell their Notes easily or at prices that provide them with a yield comparable to similar investments that have a developed secondary market. Illiquidity may have an adverse effect on the market value of Notes. Exchange rate risks and exchange controls The Issuer will pay principal and interest on the Notes in Euro. This presents certain risks relating to currency conversions if an investor's financial activities are denominated principally in a currency or currency unit other than Euro. These include the risk that exchange rates may significantly change (including changes due to devaluation of Euro or revaluation of the investor's currency) and the risk that authorities with jurisdiction over the investor's currency may impose or modify exchange controls. As a result, investors may receive less interest or principal than expected. Government and monetary authorities may impose (as some have done in the past) exchange controls that could adversely affect an applicable exchange rate. As a result, investors may receive less interest or principal than expected, or no interest or principal. Interest rate risks The Notes bearing interest at a fixed rate, investment in the Notes involves the risk that subsequent changes in market interest rates may adversely affect the value of the Notes. Potential Conflicts of Interest Certain of the Managers (as defined in section Subscription and Sale ) and their affiliates have engaged, and may in the future engage, in investment banking and/or commercial banking transactions with, and may perform services for, the Issuer and its affiliates in the ordinary course of business. In addition, in the ordinary course of their business activities, the Managers and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments of the Issuer or Issuer s affiliates. Certain of the Managers or their affiliates that have a lending relationship with the Issuer routinely hedge their credit exposure to the Issuer consistent with their customary risk management policies. Typically, such Managers and their affiliates would hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or the creation of short positions in securities, including potentially the Notes to be issued hereunder. Any such short positions could adversely affect future trading prices of Notes to be issued hereunder. The Managers and their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments. 10

11 DOCUMENTS INCORPORATED BY REFERENCE This Prospectus shall be read and construed in conjunction with: the French language 2017 annual report of the Issuer (the 2017 Annual Report), including the 2017 reference document of the Issuer (also entitled financial and legal report) dated 29 March 2018 filed with the Autorité des marchés financiers (the AMF) under number D (the 2017 Reference Document), the French language 2016 annual report of the Issuer (the 2016 Annual Report), including the 2016 reference document of the Issuer (also entitled financial and legal report) dated 5 April 2017 filed with the Autorité des marchés financiers (the AMF) under number D (the 2016 Reference Document), and which are incorporated by reference in, and shall be deemed to form part of, this Prospectus, except for the third paragraph of the "attestation du responsable du document de référence" respectively on pages 192 and 206 of the 2017 Reference Document and 2016 Reference Document. A free non binding English translation of the 2017 Reference Document and the 2016 Reference Document, for information purposes only, is available on the website of the Issuer ( Copies of the documents incorporated by reference are available without charge (i) on the Issuer's website ( and (ii) upon request at the principal office of the Issuer or of the Paying Agent during normal business hours so long as any of the Notes is outstanding, as described in "General Information" below. The 2017 Reference Document and the 2016 Reference Document are available without charge on the website of the AMF ( The information incorporated by reference in this Prospectus shall be read in connection with the cross reference list below. Any information not listed in the following cross-reference list but included in the documents incorporated by reference in this Prospectus is given for information purposes only. Prospectus Regulation Annex IX A9.2 STATUTORY AUDITORS A9.2.1 Names and addresses of the issuer s auditors for the period covered by the historical financial information (together with their membership in a professional body). A9.2.2 If auditors have resigned, been removed or not been reappointed during the period covered by the historical financial information, details if material. A9.3 RISK FACTORS A9.3.1 Prominent disclosure of risk factors that may affect the issuer s ability to fulfil its obligations under the securities to investors in a section headed "Risk Factors". A9.4 INFORMATION ABOUT THE ISSUER A9.4.1 History and development of the Issuer: 2017 Reference Document Page 193 Pages 12 to Reference Document A the legal and commercial name of the Issuer; Page 194 A the place of registration of the Issuer and its registration number; A the date of incorporation and the length of fife of the Issuer, except where indefinite; and A the domicile and legal form of the issuer, the legislation under which the issuer operates, its country of incorporation, and the address and telephone number of its registered office (or principal place of business if different from its registered office. A9.5 BUSINESS OVERVIEW Page 194 Page 194 Page

12 A9.5.1 Principal activities: Prospectus Regulation Annex IX A A brief description of the issuer s principal activities stating the main categories of products sold and/or services performed; and A The basis for any statements in the registration document made by the issuer regarding its competitive position. A9.6 ORGANISATIONAL STRUCTURE 2017 Reference Document Page 7 Pages Reference Document A9.6.1 If the issuer is part of a group, a brief description of the group and of the issuer's position within it. Pages 11 and 196 A9.9 ADMINISTRATIVE, MANAGEMENT, AND SUPERVISORY BODIES A9.9.1 Names, business addresses and functions in the issuer of the following persons, and an indication of the principal activities performed by them outside the issuer where these are significant with respect to that issuer: (a) members of the administrative, management or supervisory bodies; (b) partners with unlimited liability, in the case of a limited partnership with a share capital. A9.9.2 Administrative, Management, and Supervisory bodies conflicts of interests Potential conflicts of interests between any duties to the issuing entity of the persons referred to in item 9.1 and their private interests and or other duties must be clearly stated. In the event that there are no such conflicts, make a statement to that effect. Pages 85 to 98 N/A Pages 87, 88 and 100 A9.10 MAJOR SHAREHOLDERS A To the extent known to the issuer, state whether the issuer is directly or indirectly owned or controlled and by whom and describe the nature of such control, and describe the measures in place to ensure that such control is not abused. A A description of any arrangements, known to the issuer, the operation of which may at a subsequent date result in a change in control of the issuer. A9.11 FINANCIAL INFORMATION CONCERNING THE ISSUER'S ASSETS AND LIABILITIES, FINANCIAL POSITION AND PROFITS AND LOSSES A Historical Financial Information Audited historical financial information covering the latest 2 financial years (or such shorter period that the issuer has been in operation), and the audit report in respect of each year. Pages 15, 25 and 26 N/A Pages 134 to 160 Pages 152 to 177 (a) balance sheet; Page 134 Page 152 (b) income statement; Page 135 Page 153 (c) cash flow statement; and Page 137 Page 155 (d) accounting policies and explanatory notes Pages 138 to 160 Pages 156to 177 A Auditing of historical annual financial information Pages 182 to 184 Page 198 A Legal and arbitration proceedings Page 17 12

13 Prospectus Regulation Annex IX Information on any governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the issuer is aware), during a period covering at least the previous 12 months which may have, or have had in the recent past, significant effects on the issuer and/or group's financial position or profitability, or provide an appropriate negative statement. A9.12 MATERIAL CONTRACTS A9.12 A brief summary of all material contracts that are not entered into in the ordinary course of the issuer s business, which could result in any group member being under an obligation or entitlement that is material to the issuer s ability to meet its obligation to security holders in respect of the securities being issued Reference Document Page Reference Document 13

14 TERMS AND CONDITIONS OF THE NOTES The terms and conditions of the Notes (the Conditions), subject to completion and amendment, will be as follows: The issue of the 500,000, per cent. Notes maturing on 29 May 2025 (the Notes) by Société Foncière Lyonnaise (the Issuer) was authorised pursuant to a resolution of the board of directors of the Issuer dated 17 November The Notes are issued with the benefit of a fiscal agency agreement dated 25 May 2018 (the Fiscal Agency Agreement) between the Issuer and BNP Paribas Securities Services, as fiscal agent (the Fiscal Agent which expression shall, where the context so admits, include any successor for the time being as fiscal agent), calculation agent (the Calculation Agent) and paying agent (the Paying Agent which expression shall, where the context so admits, include any successor for the time being as paying agent). References below to the Noteholders are to the holders of the Notes. References below to Conditions are to the numbered paragraphs below. 1. Form, denomination and title The Notes will be issued on 29 May 2018 (the Issue Date) in dematerialised bearer form in the denomination of 100,000 each. Title to the Notes will be evidenced in accordance with Articles L et seq. and R of the French Code monétaire et financier by book-entries (inscription en compte). No physical document of title (including certificats représentatifs pursuant to Article R of the French Code monétaire et financier) will be issued in respect of the Notes. The Notes will, upon issue, be inscribed in book entry form in the books of Euroclear France (Euroclear France) which shall credit the accounts of the Account Holders. For the purpose of these Conditions, Account Holders shall mean any intermediary institution entitled to hold, directly or indirectly, accounts on behalf of its customers with Euroclear France, Clearstream Banking S.A. (Clearstream) and Euroclear Bank S.A./N.V. (Euroclear). Title to the Notes shall be evidenced by entries in the books of Account Holders and will pass upon, and transfer of Notes may only be effected through, registration of the transfer in such books. 2. Status of the Notes The Notes constitute direct, unconditional, unsubordinated and unsecured obligations of the Issuer and rank and will rank pari passu without any preference among themselves and (subject to such exceptions as are mandatory under French law) equally and rateably with all other present or future unsecured and unsubordinated obligations of the Issuer. 3. Negative Pledge So long as any of the Notes remains outstanding (as defined below), the Issuer undertakes that it will, and ensures that its Material Subsidiaries will, not create or permit to subsist any mortgage, lien, charge, pledge or other form of security interest upon any of their respective assets or revenues, present or future, to secure any Bond Indebtedness (as defined below) incurred by it or one of its Material Subsidiaries (as defined below) or any guarantee or indemnity assumed or granted by it or one of its Material Subsidiaries (as defined below) in respect of any Bond Indebtedness, unless at the same time or prior thereto, the Issuer's obligations under the Notes are equally and rateably secured therewith. For the purposes of the Conditions: Bond Indebtedness means any present or future indebtedness for borrowed money, which is represented by bonds, notes or other securities (including titres de créances négociables) which are for the time being, or are capable of being quoted, listed or ordinarily dealt in on any stock exchange, over-the-counter market or other securities market; Contributory Revalued Assets Value means the product of the Relevant Revalued Assets Value of the relevant Subsidiary and the rate of direct or indirect detention of the Issuer in the relevant Subsidiary; outstanding means, in relation to the Notes, all the Notes issued other than: (i) those which have been redeemed in accordance with the Conditions; (ii) those in respect of which the date for redemption in accordance with the Conditions has occurred and the redemption moneys (including all interest accrued on such Notes to the date for such 14