SuperGroup Regulatory News (SGP)

3 Feb 2006 12:18

Sanctuary Group PLC03 February 2006 3 February 2006 The Sanctuary Group plc (the "Company") Amendments to £30,000,000 Convertible Unsecured Loan Notes due 2008 (the "Loan Notes") The Loan Notes are constituted by a Convertible Loan Note Instrument dated 28November 2003 entered into by the Company and amended by supplementalinstruments dated 27 October 2004, 22 August 2005, 9 January 2006 and 27 January2006 each between (1) the Company and (2) Highbridge International LLC (the"Loan Note Instrument"). The Loan Note Instrument was entered into pursuant to a subscription agreementdated 6 November 2003 between (1) the Company and (2) Highbridge InternationalLLC and Merrill Lynch International (the "Subscription Agreement"), as amendedby a supplemental subscription agreement dated 31 March 2005 between (1) theCompany and (2) Highbridge International LLC (the "Supplemental SubscriptionAgreement"), the Loan Note Instrument, the Subscription Agreement and theSupplemental Subscription Agreement together referred to as the "Instruments". It has been agreed with Highbridge International LLC ("Highbridge"), the holderof the Loan Notes, by way of a Supplemental Instrument between the Company andHighbridge dated 2 February 2006 (the "Supplemental Instrument"), that: 1. with effect from the time at which the BoS Facility Letter (as defined below) comes into effect, the definition of "BoS Facility Letter" in Section 1.1 of the Loan Note Instrument shall be deleted and replaced by the following: ""BoS Facility Letter" the facility letter to be dated on or before the date of the Prospectus between BoS and the Company (a draft of which has been delivered to the Majority Holder);" and the definition of "Additional Revolving Credit Facility Agreement" in Section 1.1 of the Loan Note Instrument shall be deleted. The Company has confirmed that the BoS Facility Letter shall be in the form and terms of the draft annexed to the Supplemental Instrument subject to any changes thereto which Highbridge may approve in writing; 2. with effect from Completion (being the date of Admission as defined in the prospectus to be issued by the Company in relation to, amongst other things, a sub-division of the existing ordinary shares in the Company, a share consolidation, a placing and open offer of new ordinary shares of 2p each in the Company and amendments to the Company's borrowing powers (the "Prospectus")), the definition of "Ordinary Shares" in Section 1.1 of the Loan Note Instrument and in the definitions in the Warrants shall be deleted and replaced by the following: ""Ordinary Shares" the ordinary shares of 2 pence each in the capital of the Company, and "Ordinary Shareholders" shall be construed accordingly;"; 3. with effect from the Receipt Date (defined as the date being 10 days following Completion or, if earlier, the date being the second business day after the Company receives the proceeds of its issue of new shares pursuant to the Placing and Open Offer (as described in the Prospectus)), the definition of "Permitted Senior and Pari Passu Indebtedness" in Section 1.1 of the Loan Note Instrument shall be deleted and replaced with the following: "an aggregate amount of Indebtedness that may be senior or pari passu in right of payment to the Loan Notes which in respect of the Group taken as a whole does not at any time exceed £85,000,000"; 4. notwithstanding any existing provision of the Instruments: 4.1 the Conversion Price applicable to the Loan Notes immediately following Completion shall be 200p or, if lower, such amount as is equal to four times the issue price for the purposes of the Placing and Open Offer; 4.2 the Exercise Price per Warrant Share under the Warrants immediately following Completion shall be 200p or, if lower, such amount as is equal to four times the issue price for the purposes of the Placing and Open Offer; 4.3 the maximum number of Ordinary Shares of 2p each in the Company issuable upon exercise in full of the Warrants immediately following Completion shall be 2,452,924 or, if higher, the figure derived by dividing 4,905,847.10 by the revised exercise price stipulated in paragraph 4.2 above, such exercise price for these purposes being expressed as an amount in pounds as opposed to pence; 4.4 no other adjustment to the Conversion Price of the Loan Notes, the Exercise Price of the Warrants or the number of Ordinary Shares issuable upon exercise of the Warrants shall be made by reason of or by reference to the Placing and Open Offer, the Sub-Division (as described in the Prospectus), the Consolidation (as described in the press announcement issued today regarding the proposed Placing and Open Offer (the "Press Announcement")) and/or the matters set out in the Resolutions (being the resolutions set out in notice of EGM contained in the Prospectus); 4.5 the Holders of the Loan Notes and/or Warrants shall not participate in the open offer described in the Prospectus and no such open offer or any equivalent offer or like issue need be made to such Holders; provided always that, in relation to anything occurring after the Receipt Date other than in connection with the Placing and Open Offer, the Sub-Division, the Consolidation and/or the matters set out in the Resolutions, this clause shall be without prejudice to the adjustment provisions under clause 4 of the Loan Note Instrument and clause 2 of the Warrants; 5. notwithstanding any existing provision of the Instruments: 5.1 if prior to the EGM any shares in the Company are issued to Highbridge on any conversion of Loan Notes or exercise of Warrants, Highbridge for itself and as the Holder of all the Loan Notes and Warrants shall exercise all voting rights attaching to them in favour of the Resolutions; 5.2 Highbridge for itself and as the Holder of all the Loan Notes and Warrants shall ensure that prior to the EGM no Loan Notes or Warrants shall be transferred unless the transferee: 5.2.1 irrevocably undertakes to the Company in writing in a form reasonably satisfactory to the Company that in relation to all shares issued on any conversion of such Loan Notes or exercise of such Warrants, the transferee shall exercise any voting rights in favour of the Resolutions; and 5.2.2 irrevocably covenants to the Company in writing in a form reasonably satisfactory to the Company to be bound by the terms of this Supplemental Instrument and the Deed of Compromise (being the deed entered into between (1) the Company, (2) BoS and (3) Highbridge pursuant to which BoS and Highbridge agree to compromise a portion of the debt owed by the Company to each of them in order to facilitate the Placing and Open Offer); 5.3 subject to Admission, the Company shall pay to the Holders, not later than close of business on the Receipt Date, £4,700,000 from the proceeds of the Placing and Open Offer in redemption of an equal principal amount of the Subsequent Loan Notes and Additional Loan Notes, to be allocated between them pro-rata to the proportion which the principal amount of Subsequent Loan Notes and Additional Loan Notes respectively bears to the aggregate principal amount of both sets of Loan Notes, so that following completion of the Deed of Compromise the total amount of Loan Notes outstanding shall be £7,300,000, and no early prepayment or redemption fees will be payable on such repayment other than accrued interest on such £4,700,000 of Loan Notes repaid (such accrued interest on the Loan Notes repaid to be paid not later than 14 days following the Receipt Date and so that for the purposes of the Loan Note Instrument the Company's failure to pay such interest within the said period shall constitute an Event of Default); 5.4 the definition of "Permitted Liens" in Section 1.1 of the Loan Note Instrument shall be deleted and replaced by the text set out in Appendix A to the Supplemental Instrument; 5.5 the obligations of the Company under clause 8 of the Supplemental Instrument dated 9 January 2006 and paragraphs (a) and (b) of clause 9 of such Supplemental Instrument shall cease and determine with effect from Impact Day (being the date on which the Prospectus is posted to shareholders of the Company); 6. notwithstanding any existing provision of the Instruments, the Holder of the Loan Notes and the Warrants irrevocably waives all and any existing and/or previous breaches or defaults or any potential breaches or defaults arising prior to the Receipt Date (in each case whether known or unknown and whether under the Loan Notes, the Warrants or under any other document or instrument) excluding any breaches or defaults by the Company of or in respect of this Supplemental Instrument or the Deed of Compromise, but such waiver shall not affect the position after the Receipt Date in so far as any matter constituting a breach or default may occur or continue after such date; 7. to the extent that BoS has not waived the existing breaches or defaults or any potential breaches or defaults under the Debt Facilities (as defined in the Deed of Compromise) to which it is a party, or at any time becomes entitled to take enforcement action in respect of the same, the waiver in paragraph 6 above shall terminate; 8. the Company represents and warrants to the Holder of the Loan Notes and the Warrants that as at the date of the Supplemental Instrument it is not aware of any existing breach or default that amounts to an Event of Default under the Loan Note Instrument or of any existing breach or default of the Warrants and which is not referred to in the Instruments and/or the Supplemental Instrument; 9. notwithstanding any existing provision of the Instruments: 9.1 the Company may from time to time and at any time after the issue of the Press Announcement up to and including the Receipt Date incur, excluding up to £16,000,000 of borrowings owing to BoS incurred pursuant to the Additional Revolving Credit Facility Agreement, an aggregate amount of borrowings that may be senior or pari passu in right of payment to the Loan Notes which in respect of the Group taken as a whole does not at any time exceed £135,000,000 provided that (i) the indebtedness due under the BoS Facility Letter does not exceed £120,000,000; and (ii) the limits of £135,000,000 and £120,000,000 referred to above shall (unless the Majority Holder otherwise agrees in writing) be reduced at such time and to such extent as any permanent reduction is made in the facilities available under the BoS Facility Letter as varied from time to time by agreement between the Bank and the Borrower; 9.2 the Holder (including for the avoidance of doubt the Majority Holder) and the Investors acknowledge and agree that: 9.2.1 the transactions described in the Prospectus do not constitute or give rise to a Major Transaction, Organic Change, Liquidity Event and/or Event of Default within the meaning of the Instruments and/or the Warrants; 9.2.2 it will not prior to or following Completion claim that that any matter constituting a Major Transaction, Organic Change, Liquidity Event and/or Event of Default has occurred prior to Completion (but excluding any Event of Default which may occur prior to Completion and continues thereafter, but this exclusion is without prejudice to the terms of any express waiver by the Holder or the Investors in the Instruments); 9.2.3 it shall not declare all or any portion of the Loan Notes and/or the Warrants to be due and payable, redeemable and/or exerciseable on the grounds of an Event of Default or pursuant to any other provision of the Instruments and/or the Warrants by virtue of: 9.2.3.1 the issue of the Prospectus and/or the Placing and Open Offer, the Sub-Division, the Consolidation and/or the matters set out in the Resolution; or 9.2.3.2 the Company having, pending Completion, insufficient authorised and unissued share capital to satisfy its obligations pursuant to the Loan Notes and/or the Warrants; 10. save for the provisions referred to in paragraph 5.4 above, which shall continue in full force and effect from the date of the Supplemental Instrument, the Supplemental Instrument shall cease to have effect if: 10.1 less than £100,000,000 of net proceeds are raised pursuant to the Placing and Open Offer; or 10.2 Admission does not take place on or before 31 March 2006. Save as amended above, the Loan Note Instrument and the Warrants shall continuein full force and effect in accordance with their terms. Ends For further information please contact: The Sanctuary Group plc Philip Ranger, Director, Corporate & Investor 07768 534 641Relations 020 7300 1323 MerlinPaul Downes/Rebecca Penney 020 7653 6620 This information is provided by RNS The company news service from the London Stock Exchange