Obbligazione JAB Investments 1.5% ( DE000A1ZSAF4 ) in EUR

Emittente JAB Investments
Prezzo di mercato 100 EUR  ▼ 
Paese  Paesi Bassi
Codice isin  DE000A1ZSAF4 ( in EUR )
Tasso d'interesse 1.5% per anno ( pagato 1 volta l'anno)
Scadenza 24/11/2021 - Obbligazione è scaduto



Prospetto opuscolo dell'obbligazione JAB Holdings DE000A1ZSAF4 in EUR 1.5%, scaduta


Importo minimo 100 000 EUR
Importo totale 750 000 000 EUR
Descrizione dettagliata JAB Holding è una società di investimento privata tedesca con un ampio portafoglio di aziende nei settori del caffè, della moda e dei beni di lusso.

The Obbligazione issued by JAB Investments ( Netherlands ) , in EUR, with the ISIN code DE000A1ZSAF4, pays a coupon of 1.5% per year.
The coupons are paid 1 time per year and the Obbligazione maturity is 24/11/2021







Prospectus dated 20 November 2014
JAB Holdings B.V.
(incorporated as a private limited liability company with its corporate seat in Amsterdam, The Netherlands)
EUR 750,000,000 1.50 per cent. Notes due 2021
ISIN DE000A1ZSAF4, Common Code 113863889, WKN A1ZSAF
unconditionally and irrevocably guaranteed by
JAB Holding Company S.à r.l.
(incorporated as a société à responsabilité limitée with its corporate seat in Luxembourg)
Issue Price 99.598 per cent.
JAB Holdings B.V., Oudeweg 147, 2031CC Haarlem, The Netherlands (the "Issuer") will issue EUR 750,000,000 1.50 per cent.
Notes due 2021 (the "Notes") in the denomination of EUR 100,000 each on 24 November 2014 (the "Issue Date").
The Notes have the benefit of an unconditional and irrevocable guarantee (the "Guarantee") of JAB Holding Company S.à r.l.
(the "Guarantor"). The Notes and the Guarantee will be governed by the laws of the Federal Republic of Germany ("Germany").
The Issuer and the Guarantor are part of a group of holding companies (the "JAB-Group") which invest in a portfolio of
operating companies as further described under "Description of the Issuer", "Description of the Guarantor" and "Description of
the JAB-Group".
The Notes will bear interest on their outstanding amount from and including 24 November 2014 (the "Interest Commencement
Date") to but excluding the Maturity Date (as defined below) at a rate of 1.50 per cent. per annum, payable annually in arrear on
24 November of each year (each such date, an "Interest Payment Date"), commencing on 24 November 2015.
The Notes will be redeemed at their specified denomination on 24 November 2021 (the "Maturity Date"). Under certain
circumstances described in Condition 4 of the terms and conditions of the Notes (the "Terms and Conditions"), the Notes may be
subject to early redemption.
This prospectus (the "Prospectus") constitutes a prospectus for the purpose of the Luxembourg Law of 10 July 2005 on
Prospectuses for Securities, as amended. Application has been made for admission of the Notes to the official list (the "Official
List") of the Luxembourg Stock Exchange and for trading on the Euro MTF market ("Euro MTF") operated by the Luxembourg
Stock Exchange, which is a multilateral trading facility for the purposes of the Market and the Financial Instruments Directive
2004/39/EC, and therefore a non-EU-regulated market.
The Notes will initially be represented by a temporary global note in bearer form (the "Temporary Global Note"). Interests in the
Temporary Global Note will be exchangeable, in whole or in part, for interest in a permanent global note (the "Permanent Global
Note" and, together with the Temporary Global Note each a "Global Note") on or after the date 40 days after the later of the
commencement of the offering and the Issue Date (the "Exchange Date"), upon certification as to non-U.S. beneficial ownership.
The Global Notes will be deposited prior to the Issue Date with Clearstream Banking AG, Frankfurt am Main ("Clearstream
Frankfurt").
Joint Lead Managers
BNP PARIBAS
Commerzbank
HSBC
Co-Lead Managers
Landesbank Baden-Württemberg
SEB


This Prospectus is to be read in conjunction with all documents which are incorporated herein by reference
(see "Documents Incorporated by Reference" below).
No person has been authorised to give any information or to make any representation other than those
contained in this Prospectus in connection with the issue or sale of the Notes and, if given or made, such
information or representation must not be relied upon as having been authorised by the Issuer, the Guarantor
or any Manager (as defined below). Neither the delivery of this Prospectus nor any sale made in connection
herewith shall, under any circumstances, create any implication that there has been no change in the affairs
of the Issuer or the Guarantor since the date hereof or the date upon which this Prospectus has been most
recently supplemented or that there has been no adverse change in the financial position of the Issuer or the
Guarantor since the date hereof or the date upon which this Prospectus has been most recently supplemented
or that any other information supplied in connection with the Notes is correct as of any time subsequent to
the date on which it is supplied or, if different, the date indicated in the document containing the same.
The distribution of this Prospectus and the offering or sale of the Notes and the Guarantee in certain
jurisdictions may be restricted by law. Persons into whose possession this Prospectus comes are required by
the Issuer, the Guarantor and the Managers to inform themselves about and to observe any such restriction.
The Notes and the Guarantee have not been and will not be registered under the U.S. Securities Act of 1933,
as amended (the "Securities Act") or with any securities regulatory authority of any state or other
jurisdiction of the United States. The Notes will be issued in bearer form and are subject to certain U.S. tax
law requirements. Subject to certain exceptions, the Notes and the Guarantee may not be offered, sold or
delivered within the United States or to U.S. persons (as defined in Regulation S under the Securities Act
("Regulation S") and as defined in the U.S. Internal Revenue Code of 1986, as amended and regulations
thereunder). For a description of certain restrictions on offers and sales of the Notes and on distribution of
this Prospectus, see "Subscription and Sale".
This Prospectus does not constitute an offer of, or an invitation by or on behalf of the Issuer or any Manager
to subscribe for, or purchase, any Notes.
The Managers have not separately verified the information contained in this Prospectus. The Managers do
not make any representation, expressly or implied, or accept any responsibility, with respect to the accuracy
or completeness of any information contained in this Prospectus. Neither this Prospectus nor any other
financial statements are intended to provide the basis of any credit or other evaluation and should not be
considered as a recommendation by any of the Issuer, the Guarantor or the Managers that any recipient of
this Prospectus or any other financial statements should purchase the Notes. Each potential purchaser 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. The Managers do not
undertake to review the financial condition or affairs of the Issuer and the Guarantor during the life of the
arrangements contemplated by this Prospectus nor to advise any investor or potential investor in the Notes of
any information coming to the attention of any of BNP Paribas, Commerzbank Aktiengesellschaft and
HSBC Bank plc (together, the "Joint Lead Managers") and Landesbank Baden-Württemberg and
Skandinaviska Enskilda Banken AB (publ) (each a "Co-Lead Manager" and together with the Joint Lead
Managers, the "Managers"). This Prospectus may only be used for the purpose for which it has been
published.
Prospective investors should have regard to the factors described under the section headed "Risk Factors" in
this Prospectus. This Prospectus identifies in general terms certain information that a prospective investor
should consider prior to making an investment in the Notes. However, a prospective investor should conduct
its own thorough analysis (including its own accounting, legal and tax analysis) prior to deciding whether to
invest in any Notes as any evaluation of the suitability for an investor of an investment in the Notes depends
upon a prospective investor's particular financial and other circumstances, as well as on the specific terms of
the Notes and, if it does not have experience in financial, business and investment matters sufficient to
2


permit it to make such a determination, it should consult its financial adviser prior to deciding to make an
investment on the suitability of the Notes.
IN CONNECTION WITH THE ISSUE OF THE NOTES, COMMERZBANK AKTIENGESELLSCHAFT
(THE "STABILISING MANAGER") (OR A PERSON ACTING ON BEHALF OF ANY STABILISING
MANAGER) MAY OVER-ALLOT NOTES OR EFFECT TRANSACTIONS WITH A VIEW TO
SUPPORTING THE MARKET PRICE OF THE NOTES AT A LEVEL HIGHER THAN THAT WHICH
MIGHT OTHERWISE PREVAIL. HOWEVER, THERE IS NO ASSURANCE THAT THE STABILISING
MANAGER (OR A PERSON ACTING ON BEHALF OF A STABILISING MANAGER) WILL
UNDERTAKE STABILISATION ACTION. ANY STABILISATION ACTION MAY BEGIN ON OR
AFTER THE DATE ON WHICH ADEQUATE PUBLIC DISCLOSURE OF THE TERMS OF THE OFFER
OF THE NOTES IS MADE AND, IF BEGUN, MAY BE ENDED AT ANY TIME, BUT IT MUST END NO
LATER THAN THE EARLIER OF 30 CALENDAR DAYS AFTER THE ISSUE DATE OF THE NOTES
AND 60 CALENDAR DAYS AFTER THE DATE OF THE ALLOTMENT OF THE NOTES. ANY
STABILISATION ACTION OR OVER-ALLOTMENT MUST BE CONDUCTED BY THE RELEVANT
STABILISING MANAGER (OR A PERSON ACTING ON BEHALF OF ANY STABILISING
MANAGER) IN ACCORDANCE WITH ALL APPLICABLE LAWS AND RULES.
In this Prospectus, unless otherwise specified or the context otherwise requires, references to "EUR", "euro"
and "" are to the currency introduced at the third stage of the European economic and monetary union
pursuant to the Treaty establishing the European Community as amended by the Treaty on European Union.
References to "GBP" and "British pound sterling" are to the currency of the United Kingdom and references
to "US$", "USD" and "U.S. dollars" are to the currency of the United States of America.
Cautionary note regarding forward-looking statements
This Prospectus contains certain forward-looking statements, including statements using the words
"believes", "anticipates", "intends", "expects" or other similar terms. This applies in particular to statements
under the caption "General Information" and "­ Recent developments regarding the JAB-Group's divisions
after 30 June 2014" and statements elsewhere in this Prospectus relating to, among other things, the future
financial performance, plans and expectations regarding developments in the business of the JAB-Group.
These forward-looking statements are subject to a number of risks, uncertainties, assumptions and other
factors that may cause the actual results, including the financial position and profitability of the JAB-Group,
to be materially different from or worse than those expressed or implied by these forward-looking
statements. The Issuer and the Guarantor do not assume any obligation to update such forward-looking
statements and to adapt them to future events or developments.
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TABLE OF CONTENTS
Page
RISK FACTORS .............................................................................................................................................. 5
RESPONSIBILITY STATEMENT................................................................................................................. 16
TERMS AND CONDITIONS OF THE NOTES............................................................................................ 17
THE GUARANTEE....................................................................................................................................... 37
USE OF PROCEEDS ..................................................................................................................................... 41
DESCRIPTION OF THE ISSUER................................................................................................................. 42
DESCRIPTION OF THE GUARANTOR...................................................................................................... 56
DESCRIPTION OF THE JAB-GROUP......................................................................................................... 60
TAXATION .................................................................................................................................................... 65
SUBSCRIPTION AND SALE ....................................................................................................................... 73
GENERAL INFORMATION ......................................................................................................................... 75
DOCUMENTS INCORPORATED BY REFERENCE .................................................................................. 77
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RISK FACTORS
Each of the Issuer and the Guarantor believes that the following factors may affect its ability to fulfil its
obligations under the Notes or the Guarantee, respectively. All of these factors are contingencies which may
or may not occur and each of the Issuer and the Guarantor is not in a position to express a view on the
likelihood of any such contingency occurring.
Factors which the Issuer or the Guarantor believes may be material for the purpose of assessing the market
risks associated with the Notes or the Guarantee are also described below.
Each of the Issuer and the Guarantor believes that the factors described below represent the principal risks
inherent in investing in the Notes as guaranteed by the Guarantee. However, either the Issuer or the
Guarantor may be unable to pay interest, principal or other amounts on or in connection with the Notes or
the Guarantee, respectively, for other reasons and neither the Issuer nor the Guarantor represents that the
statements below regarding the risks of holding any Notes as guaranteed by the Guarantee are exhaustive.
Prospective investors should also read the detailed information set out elsewhere in this Prospectus
(including any documents deemed to be incorporated by reference herein) and reach their own views prior
to making any investment decision. Prospective investors should note that the risks relating to the Issuer and
the Guarantor, their respective industries and the Notes summarised in this section are the risks that the
Issuer and the Guarantor believe to be the most essential to an assessment by a prospective investor of
whether to consider an investment in the Notes. However, as these risks relate to events and depend on
circumstances that may or may not occur in the future, prospective investors should consider not only the
information on the key risks summarised in this section, but also, among other things, should consult their
financial, legal and tax advisers.
Risk Factors that may affect the Issuer/Guarantor's ability to fulfil its obligations under
the Notes or the Guarantee, respectively
The Issuer, the Guarantor and the JAB-Group are exposed to certain risk factors affecting their respective
abilities to fulfil their obligations under the Notes or the Guarantee, as the case may be. These risk factors
relate to the business and operations of the Issuer, the Guarantor and the JAB-Group and include matters
such as a decrease in the value of the JAB-Group's investments, a limited ability to raise capital and a failure
to integrate newly acquired businesses. The following is a summary of these risk factors:
Market risks
Exposure to prices of investment assets
The Guarantor, as holding company, holds 100% of the Issuer via an intermediate holding company, JAB
Investments S.à r.l. The Issuer is an investment company. The composition of the Issuer's investment
portfolio may vary substantially from time to time (see the structure chart of the JAB-Group and its
investments in the section "Description of the Issuer"). The market value of the portfolio directly and
indirectly held by the Issuer and the Guarantor, respectively, is subject to the market prices of the assets
comprising the portfolio. A decrease of such market prices may lead to a significantly lower market value of
the portfolio, which may affect the creditworthiness of the Issuer, the Guarantor and/or the JAB-Group.
The Issuer holds, directly and indirectly, equity interests in both listed and unlisted companies. The value of
investments in listed companies is based on the market prices of the listed companies. The value of
investments in unlisted companies is determined by employing various methods, including valuations based
on multiples for comparable listed entities and discounted cash flows analyses. Accordingly, changing
market prices and conditions may adversely affect the value of the Issuer's assets. A sustained fall in equity
and/or bond markets or changes in interest or exchange rates may reduce the Issuer's earnings significantly
and for a significant period. The Issuer's expenses may not decrease at the same rate as investment markets
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could fall and if the Issuer is not able to manage its expenses effectively, the Issuer could experience
significant and sustained losses as a consequence.
Commercial risks
Maintaining long-term ownership in holdings and a flow of investments in, and divestments into, new
investment activities involves commercial risks, such as high exposure to certain industries or individual
holdings, changing market conditions limiting attractive investment opportunities and barriers to exit from
certain holdings at the chosen time.
Dependency on investment revenues
The Issuer is an investment company without any significant operating business and the Issuer's financial
condition therefore depends upon the performance of its investment activities. The Issuer depends primarily
on the receipt of funds, distributions and dividends from its investments. The ability of the companies in
which the Issuer is invested to make such payments depends on their economic performance and financial
condition. No assurance can be given that the Issuer will receive adequate funding to maintain its financial
condition. These factors could materially and adversely affect the Issuer's ability to make payments on the
Notes.
The same is true in respect of the Guarantor which depends solely on the economic performance and
financial condition of the Issuer as its sole investment.
Cyclical business at the level of the operating companies
The complex global economic situation affects the earnings of the investment holdings of the Issuer. In
general, the sectors in which the investment holdings operate have historically been subject to highly
cyclical demand and tend to reflect the overall performance of the economy, in certain cases even amplifying
the effects of economic trends. Given the difficulty of predicting the magnitude and duration of economic
cycles, there can be no assurances as to future trends in the demand for, or supply of, products and services
sold by them in any of the markets in which they operate. Moreover, the markets in which the Issuer's
investment holdings operate are exposed to variations in energy and raw material prices or a possible
reduction in infrastructure investments. Accordingly, particular circumstances could have a material adverse
effect on the earnings, business prospects and financial position of the Issuer's investment holdings.
Local market conditions
The Issuer's and the Guarantor's earnings and financial positions and those of their respective investment
holdings are particularly influenced by the general state of the economy in the countries in which they
operate and by the variables which affect performance, including increases or decreases in gross national
product, access to credit, the level of consumer and business confidence, the cost of raw materials and the
rate of unemployment.
Strong competition
The Issuer operates via its investment holdings in businesses which are intensely competitive. The Issuer and
its holding companies compete on the basis of a number of factors, including brand recognition, fund
performance, transaction execution, products and services, innovation, reputation and price. Many of their
competitors have significant financial resources, experience and marketing strength, and may have the
ability to offer a wide range of products and services and to introduce innovative products or services, which
may enhance their competitive position.
Sector risks
The Issuer operates in consumer goods markets and intends to continue to do so in the future. Although these
markets are generally stable and usually have moderate volatility or sensitivity, prospective investors should
inform themselves about the different consumer goods markets in which the Issuer, the Guarantor and the
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JAB-Group operate via their respective investments. In addition, the Issuer is not restricted in its exercise of
discretion concerning its investment decisions and it cannot be excluded that one or more investments in
which the Issuer, the Guarantor or the JAB-Group participates will operate in other markets. Therefore, it is
possible that the Issuer will invest in other markets in the future. These markets could be more volatile or
sensitive, which could adversely affect the earnings, business prospects and financial position of the Issuer's,
the Guarantor's and the JAB-Group's investments and ultimately of the Issuer, the Guarantor and the JAB-
Group.
Liquidity Risk
The Issuer, the Guarantor and the JAB-Group mainly depend on the cash flow and returns derived from their
respective investments in the form of dividends or other distributions. The Issuer or the Guarantor may be
required to sell its respective investments in part or in whole in order to be in a position to pay interest and
principal on the Notes. Investors should note that the proceeds of any such sale may need to be applied for
mandatory prepayment of financial indebtedness other than the Notes. As a consequence, Noteholders may
be structurally subordinated in such a scenario. Furthermore, any such sale of the Issuer's or the Guarantor's
assets may be at a time where the sale proceeds from such sale are not sufficient to pay interest and principal
on the Notes. It cannot be excluded that, at the time of redemption or maturity of the Notes, no dividend will
be paid under the investments of the Issuer and the Guarantor, no sale of the respective investments is
possible and no credit facility or other financing is available. If the Issuer and/or the Guarantor do not have
sufficient liquid assets at the time of any payment, there is a significant risk that an investor in the Notes will
lose all or some of its investment.
Global Financial Crisis and Eurozone Debt Crisis
Concerns about credit risk (including that of sovereigns) and the Eurozone crisis have recently intensified.
The large sovereign debts and/or fiscal deficits of a number of European countries and the US have raised
concerns regarding the financial condition of financial institutions, insurers and other body corporates (i)
located in these countries; (ii) that have direct or indirect exposure to these countries; and/or (iii) whose
banks, counterparties, custodians, customers, service providers, sources of funding and/or suppliers have
direct or indirect exposure to these countries. The default, or a significant decline in the credit rating, of one
or more sovereigns or financial institutions could cause severe stress in the financial system generally and
could adversely affect the markets in which the issuer operates and the businesses and economic condition
and prospects of the Issuer's counterparties, customers, suppliers or creditors, directly or indirectly, in ways
that are difficult to predict.
The impact of these conditions could be detrimental to the Issuer and the Guarantor and could adversely
affect their earnings, financial position and profitability and those of their investment holdings as well as the
Guarantor's credit rating and the ability of the Issuer and the Guarantor to meet their respective obligations
under the Notes, the Guarantee and their respective debt obligations more generally.
Prospective investors should ensure that they have sufficient knowledge and awareness of the Eurozone
crisis, global financial crisis and the economic situation and outlook as they consider necessary to enable
them to make their own evaluation of the risks and merits of an investment in the Notes. In particular,
prospective investors should take into account the considerable uncertainty as to how the Eurozone crisis,
the global financial crisis and the wider economic situation will develop over time.
Financial counterparty risk
The Issuer and the Guarantor are exposed to financial institution counterparty risk and will continue to be
exposed to the risk of loss if counterparty financial institutions fail or are otherwise unable to meet their
obligations. Financial services institutions are inter-related as a result of trading, counterparty and other
relationships. The Issuer and the Guarantor have exposure to many different industries and counterparties
and routinely execute transactions with counterparties in the financial industry, including clients, financial
7


intermediaries, brokers and dealers, commercial banks and investment banks for their own account. Defaults
by, or even the perceived creditworthiness or questioning of, one or more financial services institutions or
the financial services industry generally, have led and may continue to lead to marketwide liquidity problems
and could also lead to losses or defaults. The exact nature of the risks faced by the Issuer and Guarantor is
difficult to predict and guard against in view of the severity of the global financial crisis and the fact that
many of the related risks to the business are totally, or in part, outside the control of the Issuer and the
Guarantor.
Investment risks
The Issuer, the Guarantor and the JAB-Group have made their investment decisions based on sound
financial grounds in accordance with their investment principles and have kept their leverage at a level in
line with the rating of the Notes and the rating of the Guarantor. There is no assurance, however, that any
current or future investments, if made, will not have a negative adverse impact on the Issuer's, the
Guarantor's or the JAB-Group's financial condition in the short and/or medium term and on the rating of the
Notes or the corporate credit rating of the Guarantor.
The investment portfolio of the Issuer is continuously monitored and analysed by the Issuer through constant
dialogue with the management or through direct participation through members in the management board or
supervisory board of the companies in which the Issuer, the Guarantor and the JAB-Group are invested.
However, the Issuer, the Guarantor and the JAB-Group may not be able to significantly influence the
strategy of each of their investments at all times, e.g. as result of a minority participation of other investors.
Furthermore, the Issuer, the Guarantor and the JAB-Group are not the sole investors in their respective
ultimate investments (see structure chart in the section "Description of the Issuer"). Consequently, other
investors may block any strategic decision in respect of the ultimate operating companies of the Issuer's, the
Guarantor's or the JAB-Group's investment. No assurance can be given in relation to the future performance
of the Issuer's, the Guarantor's or the JAB-Group's investment portfolio nor can it be assured that the
investment portfolio will not vary substantially from time to time or that the Issuer, the Guarantor or the
JAB-Group, given their nature as investment companies, will not dispose in whole or in part of any of their
respective investments.
No limitation on issuing further debt and guarantees or on investments
There is no restriction on the amount of debt or guarantees which the Issuer or the Guarantor may issue
ranking equal with, or senior to, the obligations under or in connection with the Notes. Such issuance of
further debt and guarantees may reduce the amount recoverable by the Noteholders upon insolvency or
winding-up of the Issuer.
Additionally, neither the Issuer nor the Guarantor is subject to a restriction on investments in other entities,
which could ultimately subordinate the Noteholders' claims to obligations of such entities towards their
respective creditors.
Strategic risks
Failure to assess future market developments and/or overall negative economic development may adversely
affect the businesses of the Issuer and the Guarantor. Corporate strategy risks can arise above all from the
erroneous assessment of future market developments. Regulatory controls and changes in public policy may
reduce the profitability of new or current business segments in which the Issuer is invested. Failure to
evaluate potential acquisition targets, to integrate newly acquired businesses or to develop successfully new
businesses may reduce the operating results of the Issuer. Significant unexpected costs for integration or
development of businesses could also harm operating results.
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Concentration risks
As of 30 June 2014, the direct and indirect principal investment holdings of the Issuer, the Guarantor and the
JAB-Group in Reckitt Benckiser Group Plc., Coty, Inc. and Acorn Holdings B.V. represented 85% of the
gross asset value of the JAB-Group's assets. Other assets (such as JAB Luxury GmbH and JAB Beech, Inc.)
represented 15% of the gross asset value of the JAB-Group's assets. Hence, there is a concentration risk
within the portfolio whereby a loss affecting a single investment may have a significant negative impact on
the overall performance of the Issuer, the Guarantor and the JAB-Group.
The results reported by the above-mentioned principal investment holdings will continue to significantly
influence the Issuer's results and any failure to achieve the objectives, or a review of these objectives by
those holdings as a consequence, inter alia, of the deterioration of the financial and economic condition and
of global market conditions, may have a prejudicial effect on the results of operations, balance sheet and
financial results, the activity, strategies and prospects of the Issuer, the Guarantor and the JAB-Group.
Currency exchange risks
Significant fluctuations in exchange rates affect the financial results of the Issuer, the Guarantor and the
JAB-Group. A significant portion of the JAB-Group's investments and related operations are outside the
Eurozone. Despite employing mechanisms to hedge against currency exchange risk, the JAB-Group cannot
preclude that fluctuations in currencies of countries outside the Eurozone, especially in U.S. dollar and
British pound sterling as of the date of this Prospectus, may materially affect the revenues of the JAB-
Group, including the Issuer and the Guarantor.
Group structure risks
The obligations of the Issuer and the Guarantor incurred under the Notes or the Guarantee, respectively, are
solely obligations of the Issuer and the Guarantor. Any other JAB-Group entity or company in which the
Issuer is invested does not have any obligation, contingent or otherwise, to pay any amounts due under the
Notes or the Guarantee or to make funds available to the Issuer or the Guarantor to pay any amounts due
under the Notes or the Guarantee. Furthermore, any claim of the Issuer in respect of its investments will rank
behind any claims in respect of indebtedness incurred, and guarantees issued, by the company in which the
Issuer is invested and claims of preference shareholders in such companies (if any). Therefore, the Notes and
the Guarantee will effectively be subordinated to creditors and preference shareholders (if any) of the
Issuer's direct and indirect investments.
Operational Risks
Insurance coverage
The JAB-Group seeks to cover foreseeable risks through insurance. Such insurance coverage comprises
management and usual liability risks. However, these insurances may not fully cover the risks to which the
JAB-Group is exposed. This may be the case for insurance covering legal and administrative claims as well
as for insurance covering other risks. For certain risks, adequate insurance coverage may not be available on
the market or may not be available with reasonable conditions. Consequently, any harm resulting from the
materialisation of these risks could result in significant capital expenditures and expenses as well as
liabilities, thereby harming business and operating results.
Key personnel risk
Success of the JAB-Group's business depends on the expertise and the dedication of the employees of the
JAB-Group. The JAB-Group continuously strives to recruit qualified staff and to foster company loyalty.
The risk of qualified employees leaving is particularly acute in key positions.
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IT-system failures
The JAB-Group is, to some degree, dependent on IT-infrastructure and IT-systems. A failure of such
infrastructure and/or systems may prevent JAB-Group from operating at its best.
Issuer's and Guarantor's financial information
The Issuer's and Guarantor's historical consolidated financial and operational performances may not be
indicative of their respective future operating and financial performances. There can be no assurance of the
Issuer's or Guarantor's continued profitability in future periods.
Investors should be aware that the Issuer is a newly merged company (the merger between the Issuer and
JAB Holdings II B.V. was effective on 21 January 2014) and the historical consolidated financial
information provided in that respect is on a pro-forma basis only without an audit having been performed by
its auditors. The historical financial information provided in respect of the Issuer and JAB Holdings II B.V.
is produced on a stand-alone basis and does not reflect the merger and the consolidated status of the Issuer as
from 21 January 2014.
Rating risks
The Issuer's/Guarantor's/JAB-Group's ability to compete successfully in the market for funding depends on
various factors, including financial stability as reflected by its operating results and credit ratings assigned
by recognised credit agencies. As a result, a downgrade in such credit ratings may impact the
Issuer's/Guarantor's/JAB-Group's ability to raise funding and this could adversely affect its business,
financial condition and results of operations.
The current rating of the Guarantor is Baa1 with a stable outlook, as assigned by Moody's Investors Services
Limited ("Moody's"), and BBB with a stable outlook, as assigned by Standard & Poor's Rating Services, a
division of The McGraw-Hill Companies Inc. ("S&P").
Credit ratings are susceptible to change at any time, and in light of the above, the Guarantor's corporate
credit rating could be downgraded at any time in accordance with the rating agencies criteria.
Please also refer to "Credit ratings may not reflect all risks of investments in the Notes" below.
Risk Factors related to the structure of the Notes
Notes may not be a suitable investment for all investors
Each potential investor in the Notes must determine the suitability of that investment in light of its own
circumstances. In particular, each potential investor should:
(i)
have sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits
and risks of investing in the Notes and the information contained or incorporated by reference in this
Prospectus or any applicable supplement;
(ii)
have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its
particular financial situation, an investment in the Notes and the impact such investment will have on
its overall investment portfolio;
(iii)
have sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes,
including where the currency for principal or interest payments is different from the potential
investor's currency;
(iv)
understand thoroughly the terms of the Notes and be familiar with the behaviour of any relevant
financial markets; and
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Document Outline