SuperGroup Regulatory News (SGP)

10 Jan 2006 07:03

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"). The Loan Notes are constituted by a Convertible Loan Note Instrument dated 28November 2003 entered into by the Company, as amended from time to time (the "Loan Note Instrument"). 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 9 January 2006 (the "Supplemental Instrument"), that: 1. the following definition will be added to Section 1.1 of the Loan NoteInstrument: "Additional Revolving Credit Facility" the additional revolvingcredit facility agreement dated 29 November 2005 between BoS and the Company (acopy of which has been delivered to the Majority Holder) as amended and restatedby the "Supplemental Facility Agreement" being an agreement to be enteredinto between BoS and the Company which amends and restates the foregoingagreement in the form and terms of the draft annexed to the SupplementalInstrument as Exhibit A (but for the avoidance of doubt excluding any amendmentor addition to the foregoing documents which may at any time be agreed betweenBoS and the Company without the prior written consent of the Majority Holdersave that any waiver which BoS may grant in respect of any obligations of theCompany under the Additional Revolving Credit Facility shall not constitute anamendment or addition for this purpose);"; 2. the definition of "Permitted Senior and Pari Passu Indebtedness" inSection 1.1 of the Loan Note Instrument shall be amended by inserting at thebeginning of such definition the words "up to £8,000,000 of Indebtedness owingto BoS incurred pursuant to the Additional Revolving Credit Facility Agreementand"; 3. the Company has represented and warranted to the Majority Holder that(i) as of the date of the Supplemental Instrument, the Group has borrowed nomore than £126,125,000 in aggregate principal amount from the Governor andCompany of the Bank of Scotland ("BoS"), £120,000,000 of which being under theBoS Facility Letter (as defined in the Loan Note Instrument) and (ii) may notdraw down more than up to an additional £8,000,000 pursuant to the AdditionalRevolving Credit Facility Agreement; 4. Section 16.1 (j) (v) of the Loan Note Instrument shall be amended by thedeletion of the words " as and when they fall due" in the second line thereof; 5. the holder (including for the avoidance of doubt the Majority Holder asdefined in the Loan Note Instrument) shall not seek to declare all or anyportion of the Loan Notes to be due and payable pursuant to Section 16.2 of theLoan Note Instrument on the grounds that an Event of Default has arisen or shallhave arisen as set out in Section 16.1(j)(v) by virtue of the fact that at anytime on or prior to 29 September 2006 (i) the value of the assets of the Companyor any Material Subsidiaries (as defined in the Loan Note Instrument) may fall,or may have fallen, to less than the amount of its liabilities (taking intoaccount its contingent and prospective liabilities) or (ii) that the Company orany Material Subsidiary has become or is deemed unable to pay its debts withinthe meaning of section 123(1)(a) of the Insolvency Act 1986 save that thisprovision shall cease to have effect (A) if Impact Day (being the day on which,the prospectus for the proposed fundraising on behalf of the Company byEvolution Securities Limited of up to £130,000,000 (gross) (the "EvolutionPlacing") having been approved by the UK Listing Authority, the fundraising isannounced and the prospectus is filed at Companies House and posted toshareholders) has not occurred by 31 January 2006 and (B) to the extent that theBoS at any time has the right (and has not waived such right) to requirerepayment of all or part of the funds which it has loaned or shall loan to theCompany or any other member of the Group in the circumstances set out in (i) or(ii). The Company has undertaken to inform the Majority Holder as soon as isreasonably practicable upon BoS acquiring (and not waiving) any such right as isreferred to in (B) in the previous sentence. For the avoidance of doubt, theforegoing provision (i) shall not prevent the Holders or any of them declaringall or any portion of the Loan Notes to be due and payable pursuant to Section16.2 of the Loan Note Instrument on the grounds that an Event of Default as setout in Section 16.1(j)(v) has arisen by virtue of the fact that the Company orany Material Subsidiary has become or is deemed unable to pay its debts withinthe meaning of section 123(1) subsections (b),(c),(d) and (e) of the InsolvencyAct 1986 and (ii) not prevent the Holders or Investors or any of them declaringall or any portion of the Loan Notes to be due and payable pursuant to Section16.2 of the Loan Note Instrument on the grounds that an Event of Default as setout in Section 16.1(j)(v) has arisen in so far as the value of the assets ofthe Company or any Material Subsidiary is after 29 September 2006 less than theamount of its liabilities (taking into account its contingent and prospectiveliabilities) irrespective of whether the values of such assets fell below theamount of such liabilities before, on or after such date or in so far as theCompany or any Material Subsidiary is after such date deemed unable to pay itsdebts within the meaning of section 123(1) (a) of the Insolvency Act 1986 or inso far as the Company or any Material Subsidiary remains after such date sounable to pay its debts by reason of there being a written demand as referred toin such section outstanding after such date relating to a sum due which theCompany or relevant Material Subsidiary shall not have paid in full or securedon or before such date or for which the Company or relevant Material Subsidiaryshall not have compounded to the reasonable satisfaction of the relevantcreditor on or before such date. The Company shall promptly supply to theMajority Holder on request made by notice in writing on or before 29 September2006 with copies of all documents entered into by the Company and/or any memberof the Group and BoS after the date of this Supplemental Instrument setting outthe terms on which BoS from time to time loans money to the Group or any memberthereof, subject to the Majority Holder entering into a confidentialityundertaking with the Company in a form reasonably satisfactory to the Company inrespect thereof;. 6. the Company has represented and warranted to Highbridge that (i) thedraft annexed to the Supplemental Instrument constitutes the AdditionalRevolving Credit Facility Agreement and (ii) the Additional Revolving CreditFacility Agreement is the only agreement between the Group and BoS pursuant towhich BoS is under an obligation to provide further funds to the Company whichhave not been provided on or before the date of the Supplemental Instrument(save in respect of advances under revolving credit facilities in the BoSFacility Letter which may be repaid and redrawn or be available to be redrawnpursuant to the terms thereof or funds made available under the multi-optionfacility letter dated 19 August 2005 between BoS, the Company and certain of itssubsidiaries (the "Overdraft") which may continue to be made available up to thelimits set out therein as at the date of the Supplemental Instrument) and (iii)BoS is not entitled to receive any fee (or other payment or right or benefit ofany kind in the nature of a fee) from any member of the Group save as expresslyset out in the BoS Facility Letter and the Overdraft (but excluding for theavoidance of doubt any addition or other amendment to the BoS Facility Letter orthe Overdraft since the dates of execution thereof), the Additional RevolvingCredit Facility Agreement, the existing security documents entered or to beentered into by the Company and/or other members of the Group pursuant to theBoS Facility Letter, the Overdraft and/or the Additional Revolving CreditFacility Agreement (the "Security Documents") or as otherwise specificallydisclosed in writing to Highbridge prior to the execution of the SupplementalInstrument. The Company has further undertaken that (i) it shall enter into theSupplemental Facility Agreement with BoS in the form and terms of the draftsupplied to Highbridge prior to the execution of the Supplemental Instrument and(ii) on or prior to Impact Day it and each member of the Group shall not makeany payment or provide or grant any fee or other payment or right or benefit ofany kind to BoS otherwise than pursuant to the BoS Facility Letter, theOverdraft, the Security Documents or the Additional Revolving Credit FacilityAgreement or as disclosed in writing to the holders; 7. the Company has undertaken to (a) provide to the Majority Holder at thesame time as to BoS the items which the Company has undertaken to deliver to BoSunder clauses 1.4 and 2.7 of the Additional Revolving Credit Facility Agreement,(b) to include in the copy of the weekly updates under clause 2.7 of theAdditional Revolving Credit Facility Agreement which are provided to theMajority Holder confirmation of the status of the working capital report beingprepared by Ernst & Young LLP (or other relevant accountants) in connectionwith the Evolution Placing and of the status of preparation and finalisation ofthe Group's audited accounts for the year ended 30 September 2005 and (c) offerto provide to the Majority Holder a copy of the Group's management accounts(being a profit and loss account and balance sheet) for each month starting withDecember 2005 (such offer to be made as soon as is reasonably practicablefollowing the production of such accounts) subject to the Majority Holderentering into a confidentiality undertaking with the Company in a formreasonably satisfactory to the Company in respect of the information and/ordocuments provided under (a), (b) or (c) above where the Majority Holder has notalready given such a confidentiality undertaking (and, if Highbridge acceptssuch offer, provide the relevant copy to Highbridge subject as aforesaid as soonas reasonably practicable following such acceptance) save that the obligation tomake the offer to Highbridge under (c) shall terminate as from Impact Day.Section 16.1 (c) of the Loan Note Instrument shall be amended by inserting afterthe words "set out in Article 15" the words "or clause 8 or 9 of the instrumentsupplemental hereto dated 9 January 2006" and after the words "for a period ofthirty (30) days" the words "in the case of a breach of Article 15 and for aperiod of five (5) days in the case of a breach of clause 8 or 9 of the saidsupplemental instrument. Section 16.1 (d) of the Loan Note Instrument shall beamended by inserting at the beginning "subject and without prejudice toparagraph (c) of this Section"; by inserting after the words "any of itsrepresentations or warranties contained" in the first line the words "in thisInstrument as amended from time to time and"; and by inserting after the words"any obligation, condition or provision expressed to be binding on it" in thethird line the words "under this Instrument as amended from time to time and". Save as amended above, the Loan Note Instrument shall continue in full force andeffect in accordance with its terms. Ends For further information please contact: 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