SuperGroup Regulatory News (SGP)

10 Jan 2006 11:45

Sanctuary Group PLC10 January 2006 10 January 2006 The Sanctuary Group plc (the "Company") Amendments to £30,000,000 Convertible Unsecured Loan Notes due 2008 (the "LoanNotes"), certain facilities made available to the Company by its bankers andcertain warrants to subscribe for ordinary shares issued by the Company. The Company, Highbridge and the Governor and Company of the Bank of Scotland ("BoS") have today entered into a heads of terms (the "Heads of Terms") governingtheir relationship and amending the terms and conditions of the Loan Notes(which are constituted by a Convertible Loan Note Instrument dated 28 November2003 entered into by the Company, as amended from time to time (the "Loan NoteInstrument")): Subject to Impact Day occurring (being the day on which, the prospectus for theproposed fundraising on behalf of the Company by Evolution Securities Limited ("Evolution") of up to £130,000,000 (gross) (the "Evolution Placing") having beenapproved by the UK Listing Authority, the fundraising is announced and theprospectus is filed at Companies House and posted to shareholders), to allow anyincrease in Indebtedness (as defined in the Loan Note Instrument) of £12 millionas may be required by the Company as from Impact Day up to the date being 10days following the date of admission to trading on the London Stock Exchange ofthe shares to be issued pursuant to the Evolution Placing ("Completion") or, ifearlier, the date being the second business day after the Company receives theproceeds of its issue of new shares pursuant to the Evolution Placing (the "Receipt Date") even if such additional Indebtedness causes the Company to exceedthe limits set out in the definition of Permitted Senior and Pari PassuIndebtedness in the Loan Note Instrument. A similar change will be made to thefacilities made available to the Company and certain of its subsidiaries by BoSpursuant to (a) a 7th supplemental agreement dated 22 August 2005, amending andrestating a facility agreement dated 26 October 1998 as amended and restatedfrom time to time; (b) the Multi-option Facility Agreement dated 19 August 2005;(c) the Additional Revolving Credit facility dated 28 November 2005 by BoS asamended by the Supplemental Facility Agreement dated 9 January 2006 (the "Facilities") to allow for such increased indebtedness (subject to BoS's usualcredit approval procedures). It is provided in the Heads of Terms that BoS will endeavour to provide newfacilities to the Company which are to be made available at Completion subjectto the Lender's usual credit approval procedures ("New Facilities"). At the Receipt Date, the definition of Permitted Senior and Pari PassuIndebtedness in the Loan Note Instrument will be reset to £20 million above themaximum available facilities under the New Facilities, up to a maximum borrowinglimit of £100 million. Should Evolution require greater headroom for workingcapital purposes, the Holder of the Loan Notes will concede to Evolution'srequirements. In the event that Completion takes place, the conversion price of the Loan Notesand the exercise price of the warrants to subscribe for up to 8,919,722 ordinaryshares in the capital of the Company issued in connection with the issue of theLoan Notes (the "Warrants") will with immediate effect be reset at four (4)times the issue price of the shares issued in the Evolution Placing. The numberof shares which are the subject of the Warrants will also be adjusted asprovided in paragraph 2 (q) of the warrant conditions, such that the totalexercise price payable by the holder of the Warrants on exercise thereof will bethe same after such alteration to the exercise price as before. These amendments will be the only adjustments that will be made to the rightsattaching to the Loan Notes and/or the Warrants in relation to and in order toreflect the Evolution Placing. Prior to and/or at Completion, the Holder of the Loan Notes (and/or sharesissued on their conversion or exercise of the Warrants) will give all suchapprovals and make any votes required in favour of the Evolution Placing and thematters dealt with in the Heads of Terms. BoS, subject to agreement of the NewFacilities and its credit approval procedures, to give all such approvals andmake any votes required in favour of the Evolution Placing and the matters dealtwith in the Heads of Terms. The Holder of the Loan Notes and the lender underthe Facilities, will only sell Warrants or Loan Notes or assign or otherwisedispose of interests in the Facilities on the basis that such Warrants, LoanNotes and interests are bound by the Heads of Terms and are voted in favour ofthe Evolution Placing and the other matters dealt with in the Heads of Terms;and Prior to Impact Day, the Holder of the Loan Notes and the lender under theFacilities, will give a waiver of any existing breaches or defaults or anypotential breaches or defaults arising prior to the Receipt Date (in each casewhether known or unknown and whether under the Loan Notes, the Warrants, theFacilities or otherwise), such waiver to be conditional on Completion occurring,but the waiver shall not affect the position after the Receipt Date in so far asany matter constituting a breach or default may occur or continue after suchdate. The Company has represented and warranted that as at the date of the Headsof Terms it is not aware of any existing breach or default that amounts to anevent of default under the Loan Note Instrument or the Warrants and which is notreferred to in the Supplemental Agreement dated 9 January 200 between theCompany and Highbridge (which was the subject of a separate announcement by theCompany earlier today). On the Receipt Date, £4.7 million of the proceeds of the Transaction will bepaid by the Company to the Holder in payment of an equal principal amount of theInitial Loan Notes and the Additional Loan Notes (as defined in the Loan NoteInstrument) to be allocated between them pro-rata to the proportion which theprincipal amount of Initial Loan Notes and Additional Loan Notes respectivelybears to the aggregate principal amount of both sets of Loan Notes, leaving atotal of £25.3 million outstanding Loan Notes. Following Completion, the net proceeds of the Transaction, less £4.7 million,will be used to repay outstanding amounts under the Facilities (includingoutstanding fees, interest and principal). No early prepayment or redemption fees will be payable on any repayments of sumsdue pursuant to the Loan Note Instrument other than accrued interest on the£4.7m of Loan Notes repaid. Such accrued interest on the repaid Loan Notesprepaid will be paid, within 14 days of the Receipt Date. If: (a) Impact Day does not occur on or before 31st January 2006; or (b)Completion does not occur on or before 28 February 2006; the Heads of Termsshall terminate and be of no further effect. Save as amended above, the Loan Note Instrument shall continue in full force andeffect in accordance with its terms. The Sanctuary Group plc Philip Ranger, Director, Corporate & Investor Relations 07768 534641 020 7300 1323 Merlin Paul Downes/Rebecca Penney 020 7653 6620 This information is provided by RNS The company news service from the London Stock Exchange