The Danish Financial Supervisory Authority Nasdaq Copenhagen A/S Vestjysk Bank A/S Torvet 4-5 7620 Lemvig, Denmark Tel. +45 96 63 20 00 31 July 2017 Vestjysk Bank announces a resolution on rights offering Vestjysk Bank has resolved to initiate an offering of new shares with pre-emptive rights for existing shareholders comprising up to 744,973,396 new shares of a nominal value of DKK 1. The offering of shares will be completed with pre-emptive rights for Vestjysk Bank s existing shareholders and at a subscription price of DKK 1 per share of a nominal value of DKK 1. The gross proceeds from the offering, if fully subscribed, will amount to DKK 744,973,396. The new shares will be offered, and may be subscribed for, during a period of 10 trading days after publication of a concerning the offering, which is expected to be published on 6 September 2017. Qualified investors will, however, on certain specific conditions, also be able to subscribe for shares prior to this period. The investor consortium behind the recently completed tender offer has issued investment undertakings on which basis Vestjysk Bank expects that the consortium members will exercise their subscription rights to subscribe for shares for approx. DKK 607 million in connection with the offering. Furthermore, certain members of the consortium have issued guarantee undertakings to subscribe for up to DKK 140 million of any remaining shares that are unsubscribed for by other shareholders or investors. A share of the proceeds equal to approx. DKK 316 million will be allocated to redemption of state hybrid core capital. Today, the board of directors of Vestjysk Bank has resolved to exercise the authorisation granted in the bank s articles of association, article 9.14, to increase the bank s share capital by up to 744,973,396 shares (the New Shares ) with pre-emptive rights for Vestjysk Bank s existing shareholders at a price of DKK 1 per share of a nominal value of DKK 1 (the Rights Offering ). The New Shares will be offered, and may be subscribed for, during a period of 10 trading days after publication of a that is expected to be published on 6 September 2017. Subscription is effected by exercising subscription rights allocated through VP Securities A/S after the. A total of 74 subscription rights are allocated for each existing share, and 15 subscription rights are required for the subscription of each new share. Until the allocation of subscription rights through VP Securities A/S has taken place, the Vestjysk Bank share (ISIN VJBA DK0010304500) will trade inclusive of subscription rights. Shareholders that meet the requirements for being a qualified investor within the meaning of section 2 of Executive Order no. 1257 of 6 November 2015 1 ( Qualified Investors ) will 1 Executive Order on Prospectuses for Securities Admitted to Trading on a Regulated Market and for Public Offerings of Securities exceeding EUR 5 million. Page 1
be able to exercise their pre-emptive right before the is published by entering into a separate subscription agreement with the bank (see further details below). Reasons for the Rights Offering The Rights Offering is effected as part of an overall solution described in Vestjysk Bank s company announcement of 12 June 2017, which encompasses the following elements: Voluntary public offer to the shareholders in Vestjysk Bank. On 18 July 2017, a voluntary public offer was completed by a group of investors to the shareholders in Vestjysk Bank, whereby the group of investors acquired, inter alia, the shareholding of the Danish State. The group of investors consists of Aktieselskabet Arbejdernes Landsbank, AP Pension Livsforsikringsaktieselskab, C.L. Davids Fond og Samling, ISP Pension, Fondsmæglerselskabet Maj Invest A/S as representative of various investors, Novo A/S, Nykredit Realkredit A/S and Vestjylland Forsikring gs (the Group of Investors ). The Rights Offering. The completion of an offering of shares with pre-emptive rights, which the bank now initiates by way of this announcement. Redemption of subordinated debt. Redemption of approx. DKK 666 million existing subordinated capital, including approx. DKK 287.6 million state capital, which, according to the terms of the loan, must be redeemed at a price of 110, corresponding to approx. DKK 316 million. Issue of new subordinated debt. The issue is expected to be completed prior to the of the Rights Offering by raising debt in the form of hybrid core capital in the amount of approx. DKK 155 million and supplementary Tier 2 capital in the amount of DKK 175-225 million. Use of proceeds Upon completion of the Rights Offering, the gross proceeds will constitute up to DKK 744,973,396. The estimated net proceeds (gross proceeds less estimated costs for Vestjysk Bank incidental to the Rights Offering) are expected to amount to between DKK 727 million and 730 million. The net proceeds are expected to be applied towards the redemption of approx. DKK 666 million existing subordinated capital, including state hybrid core capital of approx. DKK 287.6 million to be redeemed at a price of 110, corresponding to approx. DKK 316 million. The remaining part of the net proceeds will form part of Vestjysk Bank s liquidity contingency and be included in the base and core capital and thereby support Vestjysk Bank s operations and increase the bank s surplus solvency. Terms of the Rights Offering The Offering The Rights Offering comprises up to 744,973,396 shares of nominally DKK 1 each with pre-emptive rights for the bank s existing shareholders. Offer price The New Shares will be subscribed for at a price corresponding to DKK 1 for each share of nominally DKK 1. Subscription ratio The Rights Offering is completed at the ratio of 74:15 which means that the bank s existing shareholders are allocated 74 subscription rights for each existing share, and that the subscription of each New Share requires the exercise of 15 subscription rights. Page 2
Subscription rights will be allocated through VP Securities A/S on the 3rd trading day after the bank has prepared and published a, which is expected to take place on 6 September 2017. Until this date, the Vestjysk Bank share will trade inclusive of subscription rights in the permanent ISIN code admitted to trading on Nasdaq Copenhagen (ISIN VJBA DK0010304500). Subscription period The New Shares will be offered, and may be subscribed for by exercising allocated subscription rights, during a period of 10 trading days after allocation of subscription rights through VP Securities A/S, which is expected to take place on 11 September 2017. Exercise of subscription rights Shareholders wishing to exercise the allocated subscription rights will be able to do so after the through their account-holding bank or other financial provider in accordance with the rules of the bank or financial provider in question. Subscription rights that remain unexercised before the expiry of the subscription period will lose their validity and value, and holders of such subscription rights will not be entitled to compensation. Subscription of remaining shares New Shares, which after expiry of the subscription period remain unsubscribed by the bank s shareholders through the exercise of subscription rights or by other investors according to acquired subscription rights, may without compensation to the holders of any unexercised subscription rights - be subscribed for by the bank s other shareholders and investors, who, within the subscription period mentioned above, have given an undertaking to the bank to subscribe for the remaining shares at the subscription price. The form of undertaking will be included in the. If the binding undertakings for subscription exceed the number of remaining shares, an allocation will be made applying allocation criteria determined by the board of directors. Trading in subscription rights Subscription rights are expected to be admitted to trading on Nasdaq Copenhagen A/S for 10 (ten) trading days from and including the 2 nd trading day after for the Rights Offering. Until allocation of the subscription rights through VP Securities A/S has taken place, the Vestjysk Bank share (ISIN VJBA DK0010304500) will trade inclusive of subscription rights. Subscription rights cannot be separately traded at Nasdaq Copenhagen A/S prior to. Payment and delivery Upon exercise of subscription rights, the holder must pay DKK 1 for each New Share subscribed for. Payment for the New Shares is made in Danish Kroner on the date of subscription, however, no later than at expiry of the subscription period. The New Shares will obtain rights in the bank as from the time of the bank s acceptance of the subscription. Qualified Investors possibility of subscribing prior to Qualified Investors may exercise their subscription rights prior to the by subscribing for New Shares under a separate subscription agreement with the bank. The subscription agreement can be obtained by contacting the bank by email (kh@vestjyskbank.dk) provided that due documentation of its status as a Qualified Investor is submitted. Payment and settlement will be effected as stipulated in the subscription agreement. Qualified Investors having exercised their subscription rights in Page 3
this manner will receive no further allocation of subscription rights in respect of the relevant existing shares. Such existing shares will in connection with the subscription be transferred to a separate temporary ISIN code (ISIN DK0060905750), which will subsequently represent shares i Vestjysk Bank with no attaching subscription rights. The temporary ISIN code will not be admitted to trading and official listing on Nasdaq Copenhagen A/S. Immediately after and allocation through VP Securities A/S of subscription rights to the bank s other existing shares, the shares in the unlisted temporary ISIN code will be transferred to the permanent ISIN code for the bank s existing shares (ISIN VJBA DK0010304500), which is admitted to trading on Nasdaq Copenhagen A/S. Trading and official listing of New Shares Documentation for subscription of New Shares will be registered in a temporary unlisted ISIN code (ISIN DK0060905834). The New Shares will, after completion of the Rights Offering, be registered with the Danish Business Authority, and the temporary ISIN code will as soon as possible thereafter be merged with the permanent ISIN code for the bank s existing shares (ISIN VJBA DK0010304500). Cancellation or withdrawal of the Rights Offering Vestjysk Bank may at any time withdraw the Rights Offering before the capital increase relating to the New Shares is registered with the Danish Business Authority. If the Rights Offering should be withdrawn, an announcement will be made as soon as possible through Nasdaq Copenhagen A/S. Any trading in New Shares, in existing shares in the temporary ISIN code, and in subscription rights before completion of the Rights Offering and admission to trading and official listing on Nasdaq Copenhagen A/S will be at the holder s own risk and expense. If the Rights Offering is not finally completed, which is expected to take place on the 17 th trading day after, no New Shares will be issued. However, any trading in New Shares or subscription rights effected prior to the time of withdrawal will not be affected, and the subscription rights will be invalid and without value to both shareholders and investors that may have acquired such rights. Investors having made such acquisitions may therefore suffer losses. The Group of Investors' participation in the Rights Offering As described in the announcement of 12 June 2017, the Group of Investors has made an undertaking towards the State to complete an offering of shares with pre-emptive rights in the bank with proceeds of approx. DKK 745 million. In continuation thereof, the Group of Investors has issued investment undertakings on which basis Vestjysk Bank expects that the Group of Investors will exercise their subscription rights to subscribe for shares for approx. DKK 607 million in connection with the offering. Furthermore, certain members of the Investor Group have issued guarantee undertakings to subscribe (on certain terms and conditions) for an amount up to DKK 140 million of any remaining shares that are not subscribed for through the exercise of subscription rights or otherwise by investors on the basis of binding undertakings provided prior to expiry of the subscription period. Expected timetable: 1 August 2017 Qualified Investors may subscribe for shares according to a separate subscription agreement with the bank 6 September 2017 (expected) Publication of Page 4
1 st day of trading after 2 nd day of trading after 2 nd day of trading after 3 rd day of trading after 4 th day of trading after 5 th day of trading after 11 th day of trading after 13 th day of trading after 15 th day of trading after 17 th day of trading after 18 th day of trading after 19 th day of trading after The last day of trading in Vestjysk Bank s shares in the permanent ISIN code, including subscription rights (assuming trading with ordinary value-dating of two trading days) The first day of trading in Vestjysk Bank s shares in the permanent ISIN code, excluding subscription rights (assuming trading with ordinary value-dating of two trading days) The trading period for subscription rights begins Date for allocation of subscription rights to existing shareholders in the permanent ISIN code Subscription after is initiated Merger of the ISIN codes for existing shares transferred to the temporary ISIN code for Qualified Investors with the permanent ISIN code The trading period for subscription rights ends Subscription after ends Allocation of any remaining shares and result of the Rights Offering Settlement and registration with the Danish Business Authority of New Shares in Vestjysk Bank The first day of trading for New Shares Merger of the temporary ISIN code for New Shares with the permanent ISIN code for shares in Vestjysk Bank The Bank will issue an updated timetable in connection with the. Page 5
Please direct any queries concerning this company announcement to Jan Ulsø Madsen, CEO, at tel. +45 96 63 21 04. Vestjysk Bank A/S Vagn Thorsager Chairman of the board of directors This announcement does not constitute a public offering of, or an offer to buy or sell, securities in Vestjysk Bank A/S ( Securities ), and it is not a solicitation to make an offer to buy or sell Securities. The issuer of the Securities has not registered, and does not intend to register, the Securities or any portion thereof in the United States, Canada, Australia or Japan or in any other jurisdiction and does not intend to make a public offering of the Securities in the United States, Canada, Australia or Japan or in any other jurisdiction except from Denmark and Greenland. This announcement does not constitute a, and no has been approved in respect of the Rights Offering in any jurisdiction. The subscription rights and the New Shares is not, and is not expected to be, approved by regulatory authorities in any jurisdiction outside Denmark and Greenland. This announcement must not be distributed in or otherwise made available, the Offer Shares must not be offered or sold, directly or indirectly, and the subscription rights must not be exercised or otherwise offered or sold, directly or indirectly, in the United States, Canada, Australia or Japan or any jurisdiction outside Denmark and Greenland, unless such distribution, offering, sale or exercise is permitted under applicable laws in the relevant jurisdiction, and Vestjysk Bank A/S has received satisfactory documentation to that effect. The Rights Offering, the subscription rights and the New Shares have not been approved, disapproved or recommended by the U.S. Securities and Exchange Commission or any other U.S. regulatory authority. The subscription rights and the New Shares are not, and will not be, registered under the US Securities Act of 1933 as amended ( Securities Act ) or any state or securities laws in the United States. Any transfer of subscription rights and any offer and/or sale of the New Shares are not permitted except by offer and sale in accordance with Regulation S under the Securities Act. Page 6