26 Aug 2010 14:30
26 August 2010
DIGNITY ANNOUNCES THE LAUNCH OF ITS CONSENT SOLICITATION
Consent Solicitation
Dignity Finance plc (the "Company") has today announced that it is seeking the approval, by Extraordinary Resolution, of the holders of the £155,550,000 Class A Secured 6.310 per cent. Notes due 2023 (ISIN: XS0165707612) (the "Class A Notes"):
·; to certain amendments of the Issuer/Borrower Loan Agreement, the Tax Deed of Covenant, the Issuer Cash Administration and Account Bank Agreement, the Obligor Cash Administration and Account Bank Agreement, the Debenture, the Deed of Security over Shares of D2002 and the Deed of Security over Shares of D2008;
·; for certain waivers and consents to amendments under the Issuer/Borrower Loan Agreement and the Subordination Deed; and
·; in respect of the other matters described in the Extraordinary Resolution (the "Consent Solicitation").
The Consent Solicitation has been made on the terms and subject to the conditions contained in the consent solicitation document dated 26 August 2010 (the "Consent Solicitation Document"). This announcement should be read by the holders of the Class A Notes in conjunction with the Consent Solicitation Document.
If the Extraordinary Resolution is passed, holders of the Class A Notes will have the opportunity to receive an Early Instruction Fee of 0.25 per cent and a Late Instruction Fee of 0.10 per cent. following the implementation of the proposals (subject, in each case, to the detailed terms set out more fully in the Consent Solicitation Document) and indirectly benefit from the increased flexibility that the Dignity Group would then have to optimise the opportunities available to it to expand its business, manage its administration more efficiently and manage the respective businesses of its members in a more effective manner.
The meeting of the holders of the Class A Notes will take place at 10.00 a.m. on 17 September 2010.
The matters relating to the Consent Solicitation can be broadly categorised in three categories:
·; amendments to documents referred to above to permit, among other things, certain members of the Dignity Group to make certain acquisitions and/or carry out developments, hold and acquire certain assets, transfer certain excess funds and perform or undertake certain other specified activities, as more fully described in the Consent Solicitation Document (as defined above) (the "Structural Amendments");
·; amendments to documents referred to above of a mechanical and administrative nature which, if adopted, would allow the Dignity Group to operate even more efficiently (the "Administrative Amendments"); and
·; certain waivers and consents to amendments under the Issuer/Borrower Loan Agreement and the Subordination Deed to permit the Company, should it choose to proceed with the tap issue of further Class A Notes and Class B Notes (as defined below) referred to below, to use part of the proceeds of such further issuance to fund a distribution to the shareholders of Dignity plc (the "Return of Value Consent Matters").
The Extraordinary Resolution will be put to the Class A Noteholders as an Extraordinary Resolution under the terms of the trust deed constituting the Class A Notes and the £132,500,000 Class B Secured 8.151 per cent. Notes due 2031 (the "Class B Notes" and together with the Class A Notes, the "Notes") (the "Trust Deed"). Under the terms of the Trust Deed such an Extraordinary Resolution, if passed by the Class A Noteholders, will also be binding on the Class B Noteholders.
In the event that the Extraordinary Resolution is passed the Company also intends, subject to prevailing market conditions, to launch a tap issue of further Class A Notes and Class B Notes (the "Further Notes"). While some of the proceeds from the issuance of any such Further Notes may be retained in the Dignity Group to fund acquisitions and development growth in the future, it is anticipated that the majority of the proceeds will be applied to fund a distribution to the shareholders of Dignity plc which is expected to be effected through a combination of intra-group capital reductions, bonus share issues, dividend payments, dividends in specie, loan advances, the issue and redemption of B shares, the issue of irredeemable C shares, the buy back by Dignity plc of C shares and any payments made under the rights attaching to these shares (including payments effected pursuant to a buy back of such shares by Dignity plc) (together, the "Return of Value").
Indicative Timetable
| Date/Time | Event |
| ·; 8 September 2010 (4.00 p.m. London time) | Early Instruction Deadline (as defined in the Consent Solicitation Document) |
| ·; 15 September 2010 (10.00 a.m. London time) | Late Instruction Deadline (as defined in the Consent Solicitation Document) |
| ·; 17 September 2010 (10.00 a.m. London time) | Date and time of meeting |
ABI Special Committee
The Company has discussed the Consent Solicitation with a special committee (the "Special Committee") of the Association of British Insurers ("ABI") which represents 50.8 per cent. of the amount outstanding of the Class A Notes. The members of the Special Committee have examined the Consent Solicitation and have informed the Company that they find the Consent Solicitation acceptable and that they intend to vote in favour of the Consent Solicitation in respect of all of their holdings of the Class A Notes.
For further information in relation to the Consent Solicitation contact:
THE COMPANY
Dignity Finance PLC Plantsbrook House 94 The Parade Sutton Coldfield West Midlands B72 1PH United Kingdom
THE CONSENT SOLICITATION AGENT
The Royal Bank of Scotland plc 135 Bishopsgate London EC2M 3RU Telephone: +44 20 7085 9178/8056 Email: liabilitymanagement@rbs.com Attention: Tom Sermon or Andrew Burton
THE TABULATION AGENT
The Bank of New York Mellon, London Branch One Canada Square London E14 5AL United Kingdom Telephone: +44 20 7964 4958 Email: eventsadmin@bnymellon.com Facsimile: +44 20 7964 2536 Attention: CT Events Administration