TIDM40XV
RNS Number : 7758X
Paragon Mortgages (No.12) PLC
07 January 2022
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION: (A) IN OR INTO OR
TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS
TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN
ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA
ISLANDS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF
COLUMBIA) (THE "UNITED STATES") OR TO ANY U.S. PERSON (AS DEFINED
BELOW) OR (B) IN OR INTO ANY OTHER JURISDICTION WHERE IT IS
UNLAWFUL TO RELEASE, PUBLISH, OR DISTRIBUTE THIS DOCUMENT.
PARAGON MORTGAGES (NO.12) PLC
(Incorporated in England and Wales with limited liability under
registered number 5386924) (the "Issuer")
announces invitations to all the holders (the "Noteholders")
of its outstanding
U.S.$1,500,000,000 Class A1 Notes due 2038 (ISIN: XS0261644941,
the "Class A1 Notes")
GBP145,000,000 Class A2a Notes due 2038 (ISIN: XS0261646136, the
"Class A2a Notes")
EUR245,000,000 Class A2b Notes due 2038 (ISIN: XS0261646565, the
"Class A2b Notes")
U.S.$311,000,000 Class A2c Notes due 2038 (Rule 144A Note CUSIP:
US69913BAB27, Reg S Note ISIN: XS0261647027, the "Class A2c
Notes")
GBP25,000,000 Class B1a Notes due 2038 (ISIN: XS0261647886, the
"Class B1a Notes")
EUR126,000,000 Class B1b Notes due 2038 (ISIN: XS0261648850, the
"Class B1b Notes")
GBP17,000,000 Class C1a Notes due 2038 (ISIN: XS0261650161, the
"Class C1a Notes")
EUR106,000,000 Class C1b Notes due 2038 (ISIN: XS0261650674, the
"Class C1b Notes")
(together, the "Notes", and each a "Class" of Notes).
7 January 2022.
The Issuer today announces invitations (the "Consent
Solicitation") to the Noteholders to consent to the modification of
the terms and conditions of the Class A1 Notes, the Class A2a
Notes, the Class B1a Notes and the Class C1a Notes (together, the
"Sterling Notes") and consequential or related amendments to
certain transaction documents relating to the Notes such that the
existing Sterling LIBOR interest basis is replaced by a Compounded
Daily SONIA interest basis and new fallbacks are included to
address the non-availability of SONIA or the replacement of SONIA,
as proposed by the Issuer (the "Proposal") for approval by
extraordinary resolution of the Noteholders of each Class (each an
"Extraordinary Resolution" and together, the "Extraordinary
Resolutions").
Unless otherwise indicated, capitalised terms used but not
otherwise defined in this announcement have the meanings given in
the Consent Solicitation Memorandum.
The Proposal constitutes a Basic Terms Modification under the
terms and conditions of the Sterling Notes, and therefore the
holders of each Class are invited to approve the Proposal, even
though the interest rate applicable to the Sterling Notes (and no
other Notes) will be amended if the Proposal is implemented
(although the sterling amounts payable by the Issuer under the
cross-currency swaps in respect of the Notes that are not Sterling
Notes (together, the "Non-Sterling Notes") will also be amended if
the Proposal is implemented). If an Extraordinary Resolution in
respect of any Class is not successfully passed or (in the case of
any Class of the Sterling Notes) the related Eligibility Condition
is not satisfied, then the Issuer will not implement the Proposal
and no Class of the Sterling Notes will be amended (irrespective of
whether or not the relevant Extraordinary Resolution(s) for any of
the other Classes passes and/or any related Eligibility
Condition(s) is satisfied).
The Issuer has convened the Meetings for the purpose of enabling
the Noteholders to consider and resolve, if they think fit, to
approve the Proposal by way of a separate Extraordinary Resolution
in relation to each Class, implementing:
(i) respective changes in the interest basis specified in the
Conditions of the Sterling Notes from Sterling LIBOR to SONIA and
inclusion of new fallbacks to address the non-availability of SONIA
or the replacement of SONIA by means of a supplemental trust deed,
such that on the Interest Payment Date (as defined in the
Conditions) falling in May 2022, the Rate of Interest payable in
respect of the Sterling Notes will be the sum of:
(a) the Current Margin for the relevant Class of Notes (which
are detailed in Annex 2 (Margin Adjustment) to the relevant Notice
of Meeting and in the Summary of Principal Changes to the
Conditions of the Sterling Notes in the Consent Solicitation
Memorandum);
(b) the Margin Adjustment (which is fixed at 0.1193 per cent.); and
(c) the Compounded Daily SONIA rate for the relevant Interest
Period (the detailed provisions relating to the calculation of
which are set out in the Supplemental Trust Deed);
(ii) respective changes in the floating rate options specified
in the Swap Transactions hedging the Non-Sterling Notes from
Sterling LIBOR to SONIA (including corresponding and/or
consequential amendments) by means of swap amended and restated
confirmations;
(iii) corresponding and/or consequential amendments to the
Administration Agreement, Subordinated Loan Agreement, Substitute
Administrator Agreement and Substitute Administrator Facilitator
Agreement by means of an amendment agreement to the Administration
Agreement, Subordinated Loan Agreement, Substitute Administrator
Agreement and Substitute Administrator Facilitator Agreement,
all as further disclosed in the consent solicitation memorandum
prepared by the Issuer dated 7 January 2022 (the "Consent
Solicitation Memorandum").
This announcement does not contain the full terms and conditions
of the Consent Solicitation which are contained in the Consent
Solicitation Memorandum. The Consent Solicitation and Proposal are
being made on the terms and subject to the conditions contained in
the Consent Solicitation Memorandum.
The Solicitation Agent is Lloyds Bank Corporate Markets plc and
the Information and Tabulation Agent is Citibank, N.A., London
Branch.
This announcement should be read in conjunction with the Consent
Solicitation Memorandum which is available from the Information and
Tabulation Agent (including on its website via the link (
https://debtxportal.issuerservices.citigroup.com ) ).
Margin Adjustment
Due to the differences in the nature of Sterling LIBOR and
SONIA, the replacement of Sterling LIBOR as the reference rate for
the Sterling Notes requires a corresponding credit adjustment
spread to the existing Notes Interest Rate Margin payable in
respect of the relevant Class of Sterling Notes. The Proposal uses
the "5-year historical median" methodology agreed by the
International Swaps and Derivatives Association for determining
this credit adjustment spread and recommended by the Working Group
for use in cash products such as the Sterling Notes. It involves
taking the median of the daily difference between Sterling LIBOR
and SONIA in the 5 years leading up to the LIBOR Announcement Date.
Using this methodology, the credit adjustment spread for 3-month
Sterling LIBOR is 0.1193 per cent., as calculated and published by
Bloomberg Index Services Limited on the LIBOR Announcement Date and
as referenced on Bloomberg screen SBP0003M Index on the date of the
Consent Solicitation Memorandum. The credit adjustment spread for
3-month Sterling LIBOR of 0.1193 per cent. will also be applied to
the sterling amounts payable by the Issuer under the cross-currency
swaps in respect of the Non-Sterling Notes.
Notices of Meeting in respect of the Noteholders
Notices convening meetings (the "Meetings") of Noteholders, to
be held via teleconference on 31 January 2022, have been given to
the Noteholders in accordance with the Conditions on the date of
this announcement, including by way of an announcement on the
Regulatory News Service of the London Stock Exchange plc.
In light of the ongoing developments in relation to coronavirus
(COVID-19), it may be impossible or inadvisable to hold the
Meetings (and any adjourned Meetings) at a physical location.
Therefore, in accordance with the provisions of the Trust Deed,
further regulations regarding the holding of the Meetings (and any
adjourned Meetings) will be prescribed to facilitate the Meetings
(and any adjourned Meetings) being held via teleconference. The
Meetings will not be convened at a physical location. The Trustee
has agreed with the Issuer to exercise its powers under paragraph
22 of Schedule 3 (Provisions for the Meetings of Noteholders) to
the Trust Deed to prescribe further regulations regarding the
holding of meetings of the Noteholders and attendance and voting
threat. The procedures regarding the Meetings and the means of
voting on the Extraordinary Resolutions reflected in the Consent
Solicitation Memorandum and the Notices of Meeting reflect those
regulations and have been agreed by the Issuer.
Eligible Noteholders
The Issuer is convening the Meetings to consider and, if thought
fit, approve by way of an Extraordinary Resolution of each Class of
Notes the modifications of the Conditions (and the other
consequential and related modifications described in this
announcement and the Consent Solicitation Memorandum).
When submitting an Electronic Voting Instruction or otherwise
participating at the relevant Meeting in respect of the Sterling
Notes of the relevant Class, an Eligible Noteholder is a Noteholder
who is (a) located and resident outside the United States and not a
U.S. person (as defined in Regulation S under the Securities Act)
and (b) otherwise a person to whom the Consent Solicitation can be
lawfully made and that may lawfully participate in the Consent
Solicitation.
The implementation of the Proposal will be conditional on:
(a) the Consent Solicitation not having been terminated;
(b) the passing of the Extraordinary Resolution in relation to each Class; and
(c) in respect of each Extraordinary Resolution in respect of
each Class of the Sterling Notes, that the quorum required for, and
the requisite majority of votes cast at, the Meetings (including
any adjournment thereof) in respect of any Class of the Sterling
Notes will need to be satisfied by Eligible Noteholders of such
class, irrespective of any participation at the relevant Meeting by
Ineligible Noteholders (such condition in respect of each Class of
the Sterling Notes, the "Eligibility Condition").
Timetable
The indicative timetable is summarised below:
Date Action
---------------------------------------------------------- ----------------------------------------------------------
7 January 2022 Announcement of Consent Solicitation
Notices of Meeting published via RNS and delivered to
Clearing Systems for communication to
Direct Participants and to the Trustee by the Issuer.
Copies of the Consent Solicitation Memorandum and the
current drafts of the Supplemental Trust
Deed and the Amendment Agreements available from the
Consent Website.
10 January 2022 DTC Record Date
Record date for the Omnibus Proxy of DTC
5:00 p.m., Expiration Deadline
London time, 26 January 2022 Deadline for receipt by the Information and Tabulation
Agent of all valid Electronic Voting
Instructions or Forms of DTC Sub-Proxy in order for
Noteholders to be able to participate in the Consent
Solicitation.
Deadline for making any other arrangements to attend or
be represented (via teleconference)
at the relevant Meeting.
From 10.00 a.m., London time, 31 January 2022 Meetings
Meetings in respect of each Class of Notes to be held via
teleconference.
As soon as reasonably practicable after the Meetings (and Announcement of the results of each Meeting and, if
in any event within 14 days of such applicable, satisfaction of related Eligibility
result being known) Condition
Announcement of the results of each Meeting and, if the
relevant Extraordinary Resolution
is passed in respect of a Class of the Sterling Notes,
whether the related Eligibility Condition
has been satisfied.
Such announcement to be published via RNS and delivered
to Clearing Systems for communication
to Direct Participants.
As soon as reasonably practicable after the announcement Implementation Date
of the result of the Meetings If the Extraordinary Resolutions are all passed and the
related Eligibility Condition is satisfied
in respect of each Class of the Sterling Notes, the
Supplemental Trust Deed and the Amendment
Agreements (as applicable), are expected to be executed
as soon as reasonably practicable
after the announcement of the result of the Meetings,
with the changes coming into effect
from the Effective Date.
The Interest Payment Date for the Sterling Notes falling Effective Date
in February 2022 Date on which the relevant changes in the Supplemental
Trust Deed and the Amendment Agreements
(as applicable) will come into effect. For the avoidance
of doubt, the first Interest Payment
Date on which the amounts of interest payable on the
Sterling Notes will be determined by
reference to Compounded Daily SONIA rather than LIBOR
will be the Interest Payment Date falling
in May 2022 in respect of the Interest Period from (and
including) the Interest Payment Date
falling in February 2022 up to (but excluding) the
Interest Payment Date falling in May 2022.
If any Meeting is not quorate on the date stated above, such
Meeting will stand adjourned for such period being not less than 14
days nor more than 42 days, to be held via teleconference, and
notice of any adjourned meeting will be given in the same manner as
notice of the initial Meeting, save that 10 clear days' notice
(containing the information required for the notice of the initial
Meeting) will be given.
Unless stated otherwise, announcements in connection with the
Consent Solicitation will be made via RNS and by the delivery of
notices to the Clearing Systems for communication to Direct
Participants. Copies of all such announcements, press releases and
notices can also be obtained from the Consent Website or by
contacting the Information and Tabulation Agent, the contact
details for whom are below.
Noteholders are advised to check with any bank, securities
broker or other intermediary through which they hold Notes when
such intermediary would require to receive instructions from a
Noteholder in order for that Noteholder to be able to participate
in, or revoke their instruction to participate in, the Consent
Solicitation before the deadlines specified above. The deadlines
set by any such intermediary and each Clearing System for the
submission of Electronic Voting Instructions or Forms of DTC
Sub-Proxy will be earlier than the relevant deadlines specified
above.
No consent or participation fee will be payable in connection
with the Consent Solicitation.
Further information relating to the Proposal can be obtained
from the Solicitation Agent:
Lloyds Bank Corporate Markets plc
10 Gresham Street
London EC2V 7AE
Telephone: +44 20 7158 1719/1726
Attention: Liability Management Team, Commercial Banking
Email: liability.management@lloydsbanking.com
Requests for documentation and information in relation to the
procedures for delivering Consent Instructions should be directed
to the Information and Tabulation Agent at:
Citibank, N.A., London Branch
Citigroup Centre
Canada Square
London E14 5LB
Telephone: +44 (0)20 7508 3867
Attention: Exchange Team
Email: citiexchanges@citi.com
Consent Website:
https://debtxportal.issuerservices.citigroup.com
DISCLAIMER: This announcement must be read in conjunction with
the Consent Solicitation Memorandum. The Consent Solicitation
Memorandum contains important information which should be read
carefully before any decision is made with respect to the Consent
Solicitation. If any Noteholder is in any doubt as to the action it
should take or is unsure of the impact of the implementation of the
Consent Solicitation or the Proposal, it is recommended to seek its
own financial and legal advice, including in respect of any tax
consequences, immediately from its broker, bank manager, solicitor,
accountant or other independent financial, tax or legal adviser.
Any individual or company whose Notes are held on its behalf by a
broker, dealer, bank, custodian, trust company or other nominee or
intermediary must contact such entity if it wishes to participate
in the Consent Solicitation or otherwise participate at any meeting
(including any adjourned meeting) at which an Extraordinary
Resolution referred to above is to be considered.
None of the Issuer, the Administrators, the Solicitation Agent,
the Information and Tabulation Agent, the Trustee, the Principal
Paying Agent, the Reference Agent or the Registrar, makes any
recommendation whether Noteholders should participate in the
Consent Solicitation or otherwise participate at any Meeting.
Nothing in this announcement or the Consent Solicitation
Memorandum constitutes or contemplates an offer of, an offer to
purchase, or the solicitation of an offer to purchase or sell, any
security in any jurisdiction. The distribution of this announcement
and the Consent Solicitation Memorandum in certain jurisdictions
may be restricted by law, and persons into whose possession this
announcement or the Consent Solicitation Memorandum comes are
requested to inform themselves about, and to observe, any such
restrictions.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
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For further information about how RNS and the London Stock Exchange
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END
MSCBKOBPCBKKODK
(END) Dow Jones Newswires
January 07, 2022 05:20 ET (10:20 GMT)
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