| Item 2.03. | Creation of a Direct Financial Obligation of a Registrant or an Obligation under anOff-Balance Sheet Arrangement of a Registrant. |
On September 13, 2018, Discover Bank (the “Bank”), a wholly-owned subsidiary of Discover Financial Services (the “Company”), issued and sold $900,000,000 aggregate principal amount of its 4.650% Notes due 2028 (the “Notes”). The Notes were issued pursuant to a Fiscal and Paying Agency Agreement, dated September 13, 2018 (the “FPAA”), between the Bank, as issuer of the Notes, and U.S. Bank National Association, as fiscal and paying agent. The Notes were issued pursuant to an exemption from registration provided by Section 3(a)(2) of the Securities Act of 1933, as amended.
The Notes are direct, unconditional and unsecured general obligations of the Bank and rankpari passu among themselves and all other unsecured and unsubordinated indebtedness of the Bank, except deposit liabilities and other obligations that are entitled to any priorities or preferences. The Notes are solely the obligations of the Bank and are neither obligations of, nor guaranteed by, the Company (which is the sole shareholder of the Bank) or any of the Bank’s other affiliates.
The Notes mature on September 13, 2028. The Notes are subject to redemption at the option of the Bank, at any time on or after June 13, 2028, in whole or in part on no less than 10 nor more than 60 days’ prior notice delivered to the holders. The Notes will bear interest at the rate of 4.650% per annum from September 13, 2018, until the principal of the Notes has been paid in full or a sum sufficient to pay the principal of the Notes has been made available for payment. Interest on the Notes will be payable semi-annually in arrears on March 13 and September 13 of each year, commencing on March 13, 2019, and on the date of maturity or redemption (each, an “Interest Payment Date”). Payments will include interest accrued to (but excluding) the relevant Interest Payment Date. Interest on the Notes will be calculated on the basis of a360-day year of twelve30-day months.
A copy of the FPAA, which includes the form of Note as an exhibit thereto, is filed with this Current Report on Form8-K as Exhibit 4.1 and is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
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Exhibit No. | | Description |
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| 4.1 | | Fiscal and Paying Agency Agreement, dated September 13, 2018 between Discover Bank, as issuer, and U.S. Bank National Association, as fiscal and paying agent. |
