TIDM68VY
RNS Number : 0904F
Equity Release Funding (No.4) PLC
13 July 2021
NOTICE OF MEETINGS AND EXTRAORDINARY RESOLUTIONS
THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF
NOTEHOLDERS. IF ANY NOTEHOLDER IS IN ANY DOUBT AS TO THE ACTION IT
SHOULD TAKE OR IS UNSURE OF THE IMPACT OF THE IMPLEMENTATION OF ANY
EXTRAORDINARY RESOLUTION TO BE PROPOSED AT A MEETING, IT SHOULD
SEEK ITS OWN FINANCIAL AND LEGAL ADVICE, INCLUDING AS TO ANY TAX
CONSEQUENCES, IMMEDIATELY FROM ITS STOCKBROKER, BANK MANAGER,
SOLICITOR, ACCOUNTANT OR OTHER INDEPENT FINANCIAL OR LEGAL
ADVISER.
EQUITY RELEASE FUNDING (NO.4) PLC
(incorporated in England and Wales with limited liability under
registered number 4986587)
(the "Issuer")
NOTICE OF SEPARATE MEETINGS
of the holders of the outstanding Notes of the Issuer listed
below
Current Rate
Aggregate of Interest
Description Principal (per cent.
of Notes ISIN Common Code Amount Outstanding per annum)
------------------- ------------- ------------ -------------------- --------------
GBP215,000,000 XS0197423345 19742334 GBP215,000,000 Three month
Class A2 Mortgage Sterling
Backed Floating LIBOR + 0.70
Rate Notes due per cent.
2039 (the "Class Floating
A2 Notes") Rate
GBP61,000,000 XS0197423774 19742377 GBP61,000,000 Three month
Class B Mortgage Sterling
Backed Floating LIBOR + 1.50
Rate Notes due per cent.
2049 (the "Class Floating
B Notes") Rate
GBP16,500,000 XS0197424236 19742423 GBP16,500,000 Three month
Class C Mortgage Sterling
Backed Deferrable LIBOR + 3.30
Interest Floating per cent.
Rate Notes due Floating
2049 (the "Class Rate
C Notes")
GBP1,000,000 XS0197424400 19742440 GBP1,000,000 Three month
Class D Mortgage Sterling
Backed Deferrable LIBOR + 3.90
Interest Floating per cent.
Rate Notes due Floating
2049 (the "Class Rate
D Notes")
(each a "Series" and together the "Notes")
NOTICE IS HEREBY GIVEN that separate meetings (each a "Meeting"
and together the "Meetings") of the holders of each Series (the
"Noteholders") convened by the Issuer will be held via
teleconference on 4 August 2021 for the purpose of considering and,
if thought fit, passing the applicable resolutions set out below
which will, in respect of each Series, be proposed as an
Extraordinary Resolution in accordance with the provisions of the
trust deed dated 30 July 2004, as modified, supplemented and/or
restated from time to time, made between, inter alios, the Issuer
and Citicorp Trustee Company Limited (the "Trustee") as trustee for
the Noteholders, and constituting the Notes of each Series (the
"Trust Deed").
The initial Meeting (in respect of the Class A2 Notes) will
commence at 10.00 a.m. (London Time). Subsequent Meetings in
respect of each other Series (in the order set out in the table
above) will be held after the completion of the preceding
Meeting.
Unless the context requires otherwise, capitalised terms used
but not defined in this Notice have the meanings given to them in
the Trust Deed, the terms and conditions of the relevant Notes (the
"Conditions") or the Consent Solicitation Memorandum (as defined
below).
EXTRAORDINARY RESOLUTION
IN RESPECT OF THE CLASS A2 NOTES DUE 2039 (XS0197423345)
"THAT this meeting of the holders of the outstanding
GBP215,000,000 Notes due 2039 of Equity Release Funding (No.4) PLC
(the "Class A2 Notes" and the "Issuer" respectively) constituted by
the trust deed dated 30 July 2004, as modified, supplemented and/or
restated from time to time (the "Trust Deed"), made between, inter
alios, the Issuer and Citicorp Trustee Company Limited (the
"Trustee") as trustee for the holders of the Series Class A2 Notes
(the "Noteholders"), hereby:
1. (subject to paragraph 8 of this Extraordinary Resolution)
assents to the modification of: (A) the terms and conditions of the
Class A2 Notes (the "Conditions") to provide for the replacement of
LIBOR with SONIA as the reference rate for calculating interest in
respect of the Class A2 Notes and certain other related amendments
so that the relevant provisions of the Conditions will be in the
form set out in "Annex C - Form of Amended Conditions" of the
Consent Solicitation Memorandum; and (B) the terms of the ERF4
Relevant Documents pursuant to the Amendment Deed to reflect the
change to the interest rate basis of the Notes;
2. (subject to paragraph 8 of this Extraordinary Resolution)
authorises, directs, requests and empowers the Issuer and the
Trustee to: (a) consent to and execute: (i) a Supplemental Trust
Deed substantially in the form set out in "Annex B - Form of
Supplemental Trust Deed" of the Consent Solicitation Memorandum and
(ii) the Amendment Deed substantially in the form set out in "Annex
D - Form of Amendment Deed" of the Consent Solicitation Memorandum,
in each case to give effect to the changes referred to in paragraph
1 of this Extraordinary Resolution and such other changes as may be
necessary, desirable or expedient in its sole opinion, and (b)
execute and do all such other deeds, instruments, acts and things
as may be necessary, desirable or expedient in its sole opinion to
carry out and to give effect to this Extraordinary Resolution and
the implementation of the modifications referred to in this
Extraordinary Resolution;
3. (subject to paragraph 8 of this Extraordinary Resolution)
sanctions and assents to every abrogation, modification or
compromise of, or arrangement in respect of, the rights of the
Noteholders against the Issuer appertaining to the Class A2 Notes
and the ERF4 Relevant Documents, whether or not such rights arise
under the Conditions, the Trust Deed or any other transaction
documents, involved in or resulting from or to be effected by, the
modifications referred to in paragraphs 1 and 2 of this
Extraordinary Resolution and their implementation;
4. agrees that capitalised terms in this Extraordinary
Resolution where not defined herein shall have the meanings given
to them in the Consent Solicitation Memorandum (a copy of which is
available for inspection by Eligible Noteholders as referred to in
the Notice);
5. (a) discharges and exonerates the Trustee from, and
indemnifies the Trustee against, any and all liability for which it
may have become or may become responsible under the Trust Deed or
the Class A2 Notes in respect of any act or omission in connection
with this Extraordinary Resolution or its implementation and/or the
modifications; and (b) irrevocably waives any claim against the
Issuer or the Trustee which arises as a result of any loss or
damage to the holders of the Notes suffered or incurred as a result
of the Issuer or the Trustee following the terms of this
Extraordinary Resolution (including for the avoidance of doubt, the
directions and/or instructions contained herein), even though it
may subsequently be found that there is a defect in this
Extraordinary Resolution or that for any reason this Extraordinary
Resolution is not valid or binding upon the holders of the
Notes;
6. agrees that the Trustee is not responsible for the accuracy,
completeness, validity or correctness of the statements made and
documents referred to in this Extraordinary Resolution and the
Consent Solicitation Memorandum or any omissions from this
Extraordinary Resolution or the Consent Solicitation
Memorandum;
7. confirms that the Trustee is hereby authorised and instructed
not to obtain any legal opinions in relation to, or to enquire into
the power and capacity of any person to enter into, the Amendment
Deed or the Supplemental Trust Deed or the due execution and
delivery thereof by any party thereto or the validity or
enforceability thereof and they shall not be liable for any
consequences resulting from this instruction;
8. declares that the implementation of this Extraordinary
Resolution shall be conditional on:
(a) the relevant Consent Solicitation (as defined below) not having been terminated;
(b) the passing of this Extraordinary Resolution;
(c) the quorum required for, and the requisite majority of votes
cast at, this Meeting being satisfied by Eligible Noteholders,
irrespective of any participation at this Meeting by Ineligible
Noteholders and that, if the Extraordinary Resolution is passed at
this Meeting but such condition is not satisfied, the chairman of
this Meeting and the Trustee are hereby authorised, directed,
requested and empowered to adjourn this Meeting for such period
being not less than 14 days nor more than 42 days, to be held via
teleconference, for the purpose of reconsidering Resolutions 1 to 9
of this Extraordinary Resolution with the exception of this
resolution 8(c) of this Extraordinary Resolution. At any such
adjournment of this Meeting, one or more persons present holding or
representing not less than one quarter of the aggregate principal
amount of the Class A2 Notes for the time being outstanding shall
form a quorum and shall have the power to pass the Extraordinary
Resolution, and this condition set out in this paragraph 8(c) will
be satisfied if the quorum required for, and the requisite majority
of votes cast at, such adjourned Meeting are satisfied by Eligible
Noteholders irrespective of any participation at the adjourned
Meeting by Ineligible Noteholders; and
9. acknowledges that the following terms, as used in this
Extraordinary Resolution, shall have the following meanings given
below:
"Consent Solicitation" means the invitation by the Issuer to
Noteholders to consent to the modification of the Conditions
relating to the Class A2 Notes and other related documents, as
described in the Consent Solicitation Memorandum and as the same
may be amended in accordance with its terms;
"Consent Solicitation Memorandum" means the consent solicitation
memorandum dated 13 July 2021 prepared by the Issuer in relation to
the Consent Solicitation;
"Eligible Noteholders" means a Noteholder who is (a) located and
resident outside the United States and is not a U.S. person (as
defined in Regulation S under the U.S. Securities Act of 1933, as
amended), (b) an eligible counterparty or a professional client
(each as defined in Directive 2014/65/EU) and, if applicable, who
is acting on behalf of a beneficial owner that is also an eligible
counterparty or a professional client, in each case in respect of
the Class A2 Notes and (c) otherwise a person to whom the Consent
Solicitation can be lawfully made and that may lawfully participate
in the Consent Solicitation;
"ERF4 Relevant Documents" has the meaning given in the Consent Solicitation Memorandum; and
"Ineligible Noteholders" means a Noteholder that is not an
Eligible Noteholder."
EXTRAORDINARY RESOLUTION
IN RESPECT OF THE CLASS B NOTES DUE 2049 (XS0197423774)
"THAT this meeting of the holders of the outstanding
GBP61,000,000 Notes due 2049 of Equity Release Funding (No.4) PLC
(the "Class B Notes" and the "Issuer" respectively) constituted by
the trust deed dated 30 July 2004, as modified, supplemented and/or
restated from time to time (the "Trust Deed"), made between, inter
alios, the Issuer and Citicorp Trustee Company Limited (the
"Trustee") as trustee for the holders of the Class B Notes (the
"Noteholders"), hereby:
1. (subject to paragraph 8 of this Extraordinary Resolution)
assents to the modification of: (A) the terms and conditions of the
Class B Notes (the "Conditions") to provide for the replacement of
LIBOR with SONIA as the reference rate for calculating interest in
respect of the Class B Notes and certain other related amendments
so that the relevant provisions of the Conditions will be in the
form set out in "Annex C - Form of Amended Conditions" of the
Consent Solicitation Memorandum; and (B) the terms of the ERF4
Relevant Documents pursuant to the Amendment Deed to reflect the
change to the interest rate basis of the Notes;
2. (subject to paragraph 8 of this Extraordinary Resolution)
authorises, directs, requests and empowers the Issuer and the
Trustee to: (a) consent to and execute: (i) a Supplemental Trust
Deed substantially in the form set out in "Annex B - Form of
Supplemental Trust Deed" of the Consent Solicitation Memorandum and
(ii) the Amendment Deed substantially in the form set out in "Annex
D - Form of Amendment Deed" of the Consent Solicitation Memorandum,
in each case to give effect to the changes referred to in paragraph
1 of this Extraordinary Resolution and such other changes as may be
necessary, desirable or expedient in its sole opinion, and (b)
execute and do all such other deeds, instruments, acts and things
as may be necessary, desirable or expedient in its sole opinion to
carry out and to give effect to this Extraordinary Resolution and
the implementation of the modifications referred to in this
Extraordinary Resolution;
3. (subject to paragraph 8 of this Extraordinary Resolution)
sanctions and assents to every abrogation, modification or
compromise of, or arrangement in respect of, the rights of the
Noteholders against the Issuer appertaining to the Class B Notes
and the ERF4 Relevant Documents, whether or not such rights arise
under the Conditions, the Trust Deed or any other transaction
documents, involved in or resulting from or to be effected by, the
modifications referred to in paragraphs 1 and 2 of this
Extraordinary Resolution and their implementation;
4. agrees that capitalised terms in this Extraordinary
Resolution where not defined herein shall have the meanings given
to them in the Consent Solicitation Memorandum (a copy of which is
available for inspection by Eligible Noteholders as referred to in
the Notice);
5. (a) discharges and exonerates the Trustee from, and
indemnifies the Trustee against, any and all liability for which it
may have become or may become responsible under the Trust Deed or
the Class B Notes in respect of any act or omission in connection
with this Extraordinary Resolution or its implementation and/or the
modifications; and (b) irrevocably waives any claim against the
Issuer or the Trustee which arises as a result of any loss or
damage to the holders of the Notes suffered or incurred as a result
of the Issuer or the Trustee following the terms of this
Extraordinary Resolution (including for the avoidance of doubt, the
directions and/or instructions contained herein), even though it
may subsequently be found that there is a defect in this
Extraordinary Resolution or that for any reason this Extraordinary
Resolution is not valid or binding upon the holders of the
Notes;
6. agrees that the Trustee is not responsible for the accuracy,
completeness, validity or correctness of the statements made and
documents referred to in this Extraordinary Resolution and the
Consent Solicitation Memorandum or any omissions from this
Extraordinary Resolution or the Consent Solicitation
Memorandum;
7. confirms that the Trustee is hereby authorised and instructed
not to obtain any legal opinions in relation to, or to enquire into
the power and capacity of any person to enter into, the Amendment
Deed or the Supplemental Trust Deed or the due execution and
delivery thereof by any party thereto or the validity or
enforceability thereof and they shall not be liable for any
consequences resulting from this instruction;
8. declares that the implementation of this Extraordinary
Resolution shall be conditional on:
(a) the relevant Consent Solicitation (as defined below) not having been terminated;
(b) the passing of this Extraordinary Resolution;
(c) the quorum required for, and the requisite majority of votes
cast at, this Meeting being satisfied by Eligible Noteholders,
irrespective of any participation at this Meeting by Ineligible
Noteholders and that, if the Extraordinary Resolution is passed at
this Meeting but such condition is not satisfied, the chairman of
this Meeting and the Trustee are hereby authorised, directed,
requested and empowered to adjourn this Meeting for such period
being not less than 14 days nor more than 42 days, to be held via
teleconference, for the purpose of reconsidering Resolutions 1 to 9
of this Extraordinary Resolution with the exception of this
resolution 8(c) of this Extraordinary Resolution. At any such
adjournment of this Meeting, one or more persons present holding or
representing not less than one quarter of the aggregate principal
amount of the Class B Notes for the time being outstanding shall
form a quorum and shall have the power to pass the Extraordinary
Resolution, and this condition set out in this paragraph 8(c) will
be satisfied if the quorum required for, and the requisite majority
of votes cast at, such adjourned Meeting are satisfied by Eligible
Noteholders irrespective of any participation at the adjourned
Meeting by Ineligible Noteholders; and
9. acknowledges that the following terms, as used in this
Extraordinary Resolution, shall have the following meanings given
below:
"Consent Solicitation" means the invitation by the Issuer to
Noteholders to consent to the modification of the Conditions
relating to the Class B Notes and other related documents, as
described in the Consent Solicitation Memorandum and as the same
may be amended in accordance with its terms;
"Consent Solicitation Memorandum" means the consent solicitation
memorandum dated 13 July 2021 prepared by the Issuer in relation to
the Consent Solicitation;
"Eligible Noteholders" means a Noteholder who is (a) located and
resident outside the United States and is not a U.S. person (as
defined in Regulation S under the U.S. Securities Act of 1933, as
amended), (b) an eligible counterparty or a professional client
(each as defined in Directive 2014/65/EU) and, if applicable, who
is acting on behalf of a beneficial owner that is also an eligible
counterparty or a professional client, in each case in respect of
the Class B Notes and (c) otherwise a person to whom the Consent
Solicitation can be lawfully made and that may lawfully participate
in the Consent Solicitation;
"ERF4 Relevant Documents" has the meaning given in the Consent Solicitation Memorandum; and
"Ineligible Noteholders" means a Noteholder that is not an
Eligible Noteholder."
EXTRAORDINARY RESOLUTION
IN RESPECT OF THE CLASS C NOTES DUE 2049 (XS0197424236)
"THAT this meeting of the holders of the outstanding
GBP16,500,000 Notes due 2049 of Equity Release Funding (No.4) PLC
(the "Class C Notes" and the "Issuer" respectively) constituted by
the trust deed dated 30 July 2004, as modified, supplemented and/or
restated from time to time (the "Trust Deed"), made between, inter
alios, the Issuer and Citicorp Trustee Company Limited (the
"Trustee") as trustee for the holders of the Class C Notes (the
"Noteholders"), hereby:
1. (subject to paragraph 8 of this Extraordinary Resolution)
assents to the modification of: (A) the terms and conditions of the
Class C Notes (the "Conditions") to provide for the replacement of
LIBOR with SONIA as the reference rate for calculating interest in
respect of the Class C Notes and certain other related amendments
so that the relevant provisions of the Conditions will be in the
form set out in "Annex C - Form of Amended Conditions" of the
Consent Solicitation Memorandum; and (B) the terms of the ERF4
Relevant Documents pursuant to the Amendment Deed to reflect the
change to the interest rate basis of the Notes;
2. (subject to paragraph 8 of this Extraordinary Resolution)
authorises, directs, requests and empowers the Issuer and the
Trustee to: (a) consent to and execute: (i) a Supplemental Trust
Deed substantially in the form set out in "Annex B - Form of
Supplemental Trust Deed" of the Consent Solicitation Memorandum and
(ii) the Amendment Deed substantially in the form set out in "Annex
D - Form of Amendment Deed" of the Consent Solicitation Memorandum,
in each case to give effect to the changes referred to in paragraph
1 of this Extraordinary Resolution and such other changes as may be
necessary, desirable or expedient in its sole opinion, and (b)
execute and do all such other deeds, instruments, acts and things
as may be necessary, desirable or expedient in its sole opinion to
carry out and to give effect to this Extraordinary Resolution and
the implementation of the modifications referred to in this
Extraordinary Resolution;
3. (subject to paragraph 8 of this Extraordinary Resolution)
sanctions and assents to every abrogation, modification or
compromise of, or arrangement in respect of, the rights of the
Noteholders against the Issuer appertaining to the Class C Notes
and the ERF4 Relevant Documents, whether or not such rights arise
under the Conditions, the Trust Deed or any other transaction
documents, involved in or resulting from or to be effected by, the
modifications referred to in paragraphs 1 and 2 of this
Extraordinary Resolution and their implementation;
4. agrees that capitalised terms in this Extraordinary
Resolution where not defined herein shall have the meanings given
to them in the Consent Solicitation Memorandum (a copy of which is
available for inspection by Eligible Noteholders as referred to in
the Notice);
5. (a) discharges and exonerates the Trustee from, and
indemnifies the Trustee against, any and all liability for which it
may have become or may become responsible under the Trust Deed or
the Class C Notes in respect of any act or omission in connection
with this Extraordinary Resolution or its implementation and/or the
modifications; and (b) irrevocably waives any claim against the
Issuer or the Trustee which arises as a result of any loss or
damage to the holders of the Notes suffered or incurred as a result
of the Issuer or the Trustee following the terms of this
Extraordinary Resolution (including for the avoidance of doubt, the
directions and/or instructions contained herein), even though it
may subsequently be found that there is a defect in this
Extraordinary Resolution or that for any reason this Extraordinary
Resolution is not valid or binding upon the holders of the
Notes;
6. agrees that the Trustee is not responsible for the accuracy,
completeness, validity or correctness of the statements made and
documents referred to in this Extraordinary Resolution and the
Consent Solicitation Memorandum or any omissions from this
Extraordinary Resolution or the Consent Solicitation
Memorandum;
7. confirms that the Trustee is hereby authorised and instructed
not to obtain any legal opinions in relation to, or to enquire into
the power and capacity of any person to enter into, the Amendment
Deed or the Supplemental Trust Deed or the due execution and
delivery thereof by any party thereto or the validity or
enforceability thereof and they shall not be liable for any
consequences resulting from this instruction;
8. declares that the implementation of this Extraordinary
Resolution shall be conditional on:
(a) the relevant Consent Solicitation (as defined below) not having been terminated;
(b) the passing of this Extraordinary Resolution;
(c) the quorum required for, and the requisite majority of votes
cast at, this Meeting being satisfied by Eligible Noteholders,
irrespective of any participation at this Meeting by Ineligible
Noteholders and that, if the Extraordinary Resolution is passed at
this Meeting but such condition is not satisfied, the chairman of
this Meeting and the Trustee are hereby authorised, directed,
requested and empowered to adjourn this Meeting for such period
being not less than 14 days nor more than 42 days, to be held via
teleconference, for the purpose of reconsidering Resolutions 1 to 9
of this Extraordinary Resolution with the exception of this
resolution 8(c) of this Extraordinary Resolution. At any such
adjournment of this Meeting, one or more persons present holding or
representing not less than one quarter of the aggregate principal
amount of the Class C Notes for the time being outstanding shall
form a quorum and shall have the power to pass the Extraordinary
Resolution, and this condition set out in this paragraph 8(c) will
be satisfied if the quorum required for, and the requisite majority
of votes cast at, such adjourned Meeting are satisfied by Eligible
Noteholders irrespective of any participation at the adjourned
Meeting by Ineligible Noteholders; and
9. acknowledges that the following terms, as used in this
Extraordinary Resolution, shall have the following meanings given
below:
"Consent Solicitation" means the invitation by the Issuer to
Noteholders to consent to the modification of the Conditions
relating to the Class C Notes and other related documents, as
described in the Consent Solicitation Memorandum and as the same
may be amended in accordance with its terms;
"Consent Solicitation Memorandum" means the consent solicitation
memorandum dated 13 July 2021 prepared by the Issuer in relation to
the Consent Solicitation;
"Eligible Noteholders" means a Noteholder who is (a) located and
resident outside the United States and is not a U.S. person (as
defined in Regulation S under the U.S. Securities Act of 1933, as
amended), (b) an eligible counterparty or a professional client
(each as defined in Directive 2014/65/EU) and, if applicable, who
is acting on behalf of a beneficial owner that is also an eligible
counterparty or a professional client, in each case in respect of
the Class C Notes and (c) otherwise a person to whom the Consent
Solicitation can be lawfully made and that may lawfully participate
in the Consent Solicitation;
"ERF4 Relevant Documents" has the meaning given in the Consent Solicitation Memorandum; and
"Ineligible Noteholders" means a Noteholder that is not an
Eligible Noteholder."
EXTRAORDINARY RESOLUTION
IN RESPECT OF THE CLASS D NOTES DUE 2049 (XS0197424400)
"THAT this meeting of the holders of the outstanding
GBP1,000,000 Notes due 2049 of Equity Release Funding (No.4) PLC
(the "Class D Notes" and the "Issuer" respectively) constituted by
the trust deed dated 30 July 2004, as modified, supplemented and/or
restated from time to time (the "Trust Deed"), made between, inter
alios, the Issuer and Citicorp Trustee Company Limited (the
"Trustee") as trustee for the holders of the Class D Notes (the
"Noteholders"), hereby:
1. (subject to paragraph 8 of this Extraordinary Resolution)
assents to the modification of: (A) the terms and conditions of the
Class D Notes (the "Conditions") to provide for the replacement of
LIBOR with SONIA as the reference rate for calculating interest in
respect of the Class D Notes and certain other related amendments
so that the relevant provisions of the Conditions will be in the
form set out in "Annex C - Form of Amended Conditions" of the
Consent Solicitation Memorandum; and (B) the terms of the ERF4
Relevant Documents pursuant to the Amendment Deed to reflect the
change to the interest rate basis of the Notes;
2. (subject to paragraph 8 of this Extraordinary Resolution)
authorises, directs, requests and empowers the Issuer and the
Trustee to: (a) consent to and execute: (i) a Supplemental Trust
Deed substantially in the form set out in "Annex B - Form of
Supplemental Trust Deed" of the Consent Solicitation Memorandum and
(ii) the Amendment Deed substantially in the form set out in "Annex
D - Form of Amendment Deed" of the Consent Solicitation Memorandum,
in each case to give effect to the changes referred to in paragraph
1 of this Extraordinary Resolution and such other changes as may be
necessary, desirable or expedient in its sole opinion, and (b)
execute and do all such other deeds, instruments, acts and things
as may be necessary, desirable or expedient in its sole opinion to
carry out and to give effect to this Extraordinary Resolution and
the implementation of the modifications referred to in this
Extraordinary Resolution;
3. (subject to paragraph 8 of this Extraordinary Resolution)
sanctions and assents to every abrogation, modification or
compromise of, or arrangement in respect of, the rights of the
Noteholders against the Issuer appertaining to the Class D Notes
and the ERF4 Relevant Documents, whether or not such rights arise
under the Conditions, the Trust Deed or any other transaction
documents, involved in or resulting from or to be effected by, the
modifications referred to in paragraphs 1 and 2 of this
Extraordinary Resolution and their implementation;
4. agrees that capitalised terms in this Extraordinary
Resolution where not defined herein shall have the meanings given
to them in the Consent Solicitation Memorandum (a copy of which is
available for inspection by Eligible Noteholders as referred to in
the Notice);
5. (a) discharges and exonerates the Trustee from, and
indemnifies the Trustee against, any and all liability for which it
may have become or may become responsible under the Trust Deed or
the Class D Notes in respect of any act or omission in connection
with this Extraordinary Resolution or its implementation and/or the
modifications; and (b) irrevocably waives any claim against the
Issuer or the Trustee which arises as a result of any loss or
damage to the holders of the Notes suffered or incurred as a result
of the Issuer or the Trustee following the terms of this
Extraordinary Resolution (including for the avoidance of doubt, the
directions and/or instructions contained herein), even though it
may subsequently be found that there is a defect in this
Extraordinary Resolution or that for any reason this Extraordinary
Resolution is not valid or binding upon the holders of the
Notes;
6. agrees that the Trustee is not responsible for the accuracy,
completeness, validity or correctness of the statements made and
documents referred to in this Extraordinary Resolution and the
Consent Solicitation Memorandum or any omissions from this
Extraordinary Resolution or the Consent Solicitation
Memorandum;
7. confirms that the Trustee is hereby authorised and instructed
not to obtain any legal opinions in relation to, or to enquire into
the power and capacity of any person to enter into, the Amendment
Deed or the Supplemental Trust Deed or the due execution and
delivery thereof by any party thereto or the validity or
enforceability thereof and they shall not be liable for any
consequences resulting from this instruction;
8. declares that the implementation of this Extraordinary
Resolution shall be conditional on:
(a) the relevant Consent Solicitation (as defined below) not having been terminated;
(b) the passing of this Extraordinary Resolution;
(c) the quorum required for, and the requisite majority of votes
cast at, this Meeting being satisfied by Eligible Noteholders,
irrespective of any participation at this Meeting by Ineligible
Noteholders and that, if the Extraordinary Resolution is passed at
this Meeting but such condition is not satisfied, the chairman of
this Meeting and the Trustee are hereby authorised, directed,
requested and empowered to adjourn this Meeting for such period
being not less than 14 days nor more than 42 days, to be held via
teleconference, for the purpose of reconsidering Resolutions 1 to 9
of this Extraordinary Resolution with the exception of this
resolution 8(c) of this Extraordinary Resolution. At any such
adjournment of this Meeting, one or more persons present holding or
representing not less than one quarter of the aggregate principal
amount of the Class D Notes for the time being outstanding shall
form a quorum and shall have the power to pass the Extraordinary
Resolution, and this condition set out in this paragraph 8(c) will
be satisfied if the quorum required for, and the requisite majority
of votes cast at, such adjourned Meeting are satisfied by Eligible
Noteholders irrespective of any participation at the adjourned
Meeting by Ineligible Noteholders; and
9. acknowledges that the following terms, as used in this
Extraordinary Resolution, shall have the following meanings given
below:
"Consent Solicitation" means the invitation by the Issuer to
Noteholders to consent to the modification of the Conditions
relating to the Class D Notes and other related documents, as
described in the Consent Solicitation Memorandum and as the same
may be amended in accordance with its terms;
"Consent Solicitation Memorandum" means the consent solicitation
memorandum dated 13 July 2021 prepared by the Issuer in relation to
the Consent Solicitation;
"Eligible Noteholders" means a Noteholder who is (a) located and
resident outside the United States and is not a U.S. person (as
defined in Regulation S under the U.S. Securities Act of 1933, as
amended), (b) an eligible counterparty or a professional client
(each as defined in Directive 2014/65/EU) and, if applicable, who
is acting on behalf of a beneficial owner that is also an eligible
counterparty or a professional client, in each case in respect of
the Class D Notes and (c) otherwise a person to whom the Consent
Solicitation can be lawfully made and that may lawfully participate
in the Consent Solicitation;
"ERF4 Relevant Documents" has the meaning given in the Consent Solicitation Memorandum; and
"Ineligible Noteholders" means a Noteholder that is not an
Eligible Noteholder."
Background
The Issuer has convened the Meetings for the purpose of enabling
Noteholders of each Series to consider and resolve, if they think
fit, to pass the Extraordinary Resolution proposed in relation to
the Notes of the relevant Series.
On 5 March 2021 (the "LIBOR Announcement Date"), the UK
Financial Conduct Authority (the "FCA") confirmed that all Sterling
LIBOR settings will either cease to be provided by any
administrator or no longer be representative of their underlying
market immediately after 31 December 2021 (the "LIBOR
Announcement"). The FCA has also made a number of previous
announcements regarding the proposed cessation of LIBOR). In
relation to 3-month Sterling LIBOR in particular (as the interest
rate benchmark currently applicable to the Notes), the LIBOR
Announcement provided that immediately after 31 December 2021, such
LIBOR setting would no longer be representative of the underlying
market and economic reality and that such representativeness will
not be restored. For additional background to the LIBOR
Announcement, we refer to:
(a) the speech of Andrew Bailey, the Chief Executive of the FCA,
on 27 July 2017 entitled "The Future of LIBOR";
(b) the statement of the FCA entitled "FCA Statement on LIBOR
panels" dated 24 November 2017;
(c) the speech of Andrew Bailey, the Chief Executive of the FCA,
on 12 July 2017 entitled "Interest rate benchmark reform -
transition to a world without LIBOR";
(d) the "Dear CEO Letter" sent by the FCA and the Prudential
Regulation Authority to major banks and insurers and published on
the FCA website, dated 19 September 2018, relating to the need to
transition from LIBOR to alternative benchmarks;
(e) the speech of Andrew Bailey, the Chief Executive of the FCA,
on 15 July 2019 entitled "The Future of LIBOR";
(f) the statement of the FCA entitled "Transition from LIBOR"
dated 4 September 2019; and
(g) the open letter from The Investment Association to issuers
entitled "INVESTORS CALL ON COMPANIES TO TAKE URGENT ACTION AND
TRANSITION THEIR LIBOR-LINKED BONDS" dated 3 February 2021.
(a) to (f) of the above is available from the website of the FCA
at www.fca.org.uk and (g) is available at
https://www.theia.org/media/press-releases/investors-call-companies-take-urgent-action-and-transition-their-libor-linked.
In 2017, the Bank of England (the "BoE") and the FCA announced
that they had mandated a working group (the "Working Group") to
implement a broad-based transition to the Sterling Overnight Index
Average ("SONIA") across sterling bond, loan and derivative
markets, so that SONIA is established as the primary sterling
interest rate benchmark by the end of 2021. Therefore, Sterling
LIBOR will not continue on the current basis after 2021, and
regulators have urged market participants to take active steps to
implement the transition to SONIA and other risk-free rates ahead
of this deadline.
On the basis that the final maturity date of each Series of
Notes falls after 2021, the Issuer has convened the Meetings for
the purpose of enabling the Noteholders of each Series of Notes to
consider and resolve, if they think fit, to approve the Proposals
by way of an Extraordinary Resolution in relation to each Series of
Notes, implementing respective changes in the interest basis
specified in the Conditions from LIBOR to SONIA, and corresponding
and/or consequential amendments (if any) to the ERF4 Relevant
Documents.
The formula for calculating interest on each Series of Notes
shall be as set out in Annex 1 to the Notice of Meetings. Due to
the differences in the nature of LIBOR and SONIA, the replacement
of LIBOR as the reference rate for each Series of Notes requires a
corresponding credit adjustment spread to the existing Relevant
Margin payable in respect of each Series of Notes. The Proposals
use the "5-year historical median" methodology agreed by ISDA for
determining this credit adjustment spread and recommended by the
Working Group for use in cash products such as the Notes. It
involves taking the median of the daily difference between 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 as of the date of
this Consent Solicitation Memorandum.
The Trustee has not been involved in the formulation of the
Extraordinary Resolutions and the Trustee expresses no opinion on
the merits of any Extraordinary Resolution or on whether
Noteholders would be acting in their best interests in approving
the Extraordinary Resolutions, and nothing in this Notice should be
construed as a recommendation to Noteholders from the Trustee to
vote in favour of, or against, any Extraordinary Resolution.
Noteholders should take their own independent financial, accounting
and legal advice on the merits and on the consequences of voting in
favour of, or against, the relevant Extraordinary Resolution(s),
including as to any tax consequences. The Trustee has not reviewed,
nor will it be reviewing, any documents relating to the Consent
Solicitations, except those to which it will be a party and this
Notice of Meetings. On the basis of the information set out in this
Notice of Meetings (other than Annex 2 (Margin Adjustment) of the
Notice of Meetings which it has not reviewed) and the Consent
Solicitation Memorandum, the Trustee has authorised it to be stated
that it has no objection to the Extraordinary Resolutions being put
to Noteholders for their consideration.
Consent Solicitations
The Issuer has invited holders of the Notes of each Series (each
such invitation a "Consent Solicitation") to consent to the
approval, by Extraordinary Resolution at the relevant Meeting, of
the modification of the Conditions relating to the relevant Series
and related documents as described in the relevant Extraordinary
Resolution as set out above, all as further described in the
Consent Solicitation Memorandum (as defined in the relevant
Extraordinary Resolution set out above).
The Consent Solicitation Memorandum and any other documents or
materials relating to the Consent Solicitation are only for
distribution or to be made available to persons who are Eligible
Noteholders (as defined in the Extraordinary Resolution above).
Subject to the restrictions described in the previous paragraph,
Noteholders may obtain, from the date of this Notice, a copy of the
Consent Solicitation Memorandum from the Tabulation Agent, the
contact details for which are set out below.
General
Eligible Noteholders may obtain, from the date of this Notice, a
copy of the Consent Solicitation Memorandum from the Tabulation
Agent, the contact details for which are set out below. A
Noteholder will be required to produce evidence satisfactory to the
Tabulation Agent as to his or her status as an Eligible Noteholder
and that he or she is a person to whom it is lawful to send the
Consent Solicitation Memorandum and to make an invitation to
participate in the Consent Solicitations under applicable laws
before being sent a copy of the Consent Solicitation
Memorandum.
Copies of (i) the Trust Deed, (ii) this Notice of Meetings and
(iii) the current drafts of the Supplemental Trust Deed and the
Amendment Deed as referred to in the relevant Extraordinary
Resolutions, are also available for inspection by Noteholders on
and from the date of this Notice of Meetings up to and including
the date of the Meetings, at the specified offices of the
Tabulation Agent during normal business hours on any weekday
(Saturdays, Sundays and public holidays excepted) up to and
including the date of the Meetings and (b) at the Meetings. Any
revised versions of the drafts of the Supplemental Trust Deed and
the Amendment Deed made available as described above and marked to
indicate changes to the draft made available on the date of this
Notice of Meetings will supersede the previous drafts of the
Supplemental Trust Deed and the Amendment Deed, and Noteholders
will be deemed to have notice of any such changes.
The attention of Noteholders is particularly drawn to the
procedures for voting, quorum and other requirements for the
passing of the Extraordinary Resolutions at the Meetings or any
meeting held following any adjournment of any Meeting, which are
set out in the second paragraph of "Voting and Quorum" below.
Having regard to such requirements, Noteholders are strongly urged
either to attend the relevant Meeting(s) (via teleconference) or to
take steps to be represented at the relevant Meeting(s) (including
by way of submitting Electronic Voting Instructions in favour of
the relevant Proposal (all such terms as defined in the Consent
Solicitation Memorandum)) as soon as possible.
In light of the ongoing developments in relation to coronavirus
(COVID-19), it may be impossible or inadvisable to hold the
Meetings at a physical location. Therefore, in accordance with the
provisions of the Trust Deed, the Issuer has requested that the
Trustee prescribe appropriate regulations regarding the holding of
the Meetings via teleconference, as further described below. Any
Noteholders who have a Voting Certificate and indicate to the
Tabulation Agent (the contact details for which are set out below)
that they wish to attend the Meetings (via teleconference) will be
provided with further details about attending the Meetings.
Noteholders who do not indicate to the Tabulation Agent prior to
the Meetings that they wish to attend the Meetings will not be
provided with details about attending the meeting and will not be
able to attend the Meetings whether or not they hold a Voting
Certificate.
Noteholders who have submitted Electronic Voting Instructions
(and thereby requested that their votes are included in a form of
proxy appointing one or more representatives of the Tabulation
Agent as its proxy to attend the Meetings (and any adjourned
Meeting) and to vote in the manner specified or identified in such
Electronic Voting Instruction) will be unaffected by these
alternative regulations and will not be requested to take any
further action. The Issuer will take appropriate steps to ensure
that only those who would otherwise be entitled to attend and vote
at a physical meeting will be entitled to attend the
teleconference.
Voting and Quorum
Noteholders who have submitted and not revoked (in the limited
circumstances in which revocation is permitted) a valid Electronic
Voting Instruction in respect of the relevant Extraordinary
Resolution, by which they will have given instructions for the
appointment of one or more representatives of the Tabulation Agent
by Principal Paying Agent as their proxy to attend and vote (as
specified in the relevant Electronic Vote Instruction) in respect
of the relevant Extraordinary Resolution at the relevant Meeting
and any meeting held following any adjournment of the relevant
Meeting, need take no further action to be represented at the
relevant Meeting or any such adjourned meeting. Further details on
how to submit an Electronic Voting Instruction are set out
below.
Noteholders who have not submitted or have submitted and
subsequently revoked (in the limited circumstances in which such
revocation is permitted) an Electronic Voting Instruction in
respect of the relevant Extraordinary Resolution should take note
of the relevant provisions set out below detailing how such
Noteholders can attend or take steps to be represented at the
relevant Meeting (references to which, for the purpose of such
provisions, include, unless the context otherwise requires, any
meeting held following any adjournment of the relevant
Meeting).
1. Subject as set out below, the provisions governing the
convening and holding of a meeting of the Noteholders are set out
in Schedule 4 to the Trust Deed, a copy of which is available for
inspection by the Noteholders as referred to above.
Each person (a beneficial owner) who is the owner of a
particular aggregate principal amount of the Notes through
Euroclear, Clearstream, Luxembourg or a person who is shown in the
records of Euroclear or Clearstream, Luxembourg as a holder of the
Notes (a "Direct Participant"), should note that a beneficial owner
will only be entitled to attend and vote at the relevant Meeting in
accordance with the procedures set out below and where a beneficial
owner is not a Direct Participant it will need to make the
necessary arrangements, either directly or with the intermediary
through which it holds its Notes, for the Direct Participant to
complete these procedures on its behalf.
A Noteholder who wishes to attend and vote at the relevant
Meeting and any adjourned such Meeting in person must have obtained
a valid Voting Certificate issued by the Principal Paying
Agent.
A Noteholder may obtain a Voting Certificate in respect of its
Notes from the Tabulation Agent by arranging for its Notes to be
blocked in an account with Euroclear or Clearstream, Luxembourg
(unless the Note is the subject of a block voting instruction which
has been issued and is outstanding in respect of the relevant
Meeting or any adjourned such Meeting) not less than 48 hours
before the time fixed for the Meeting (or, if applicable, any
adjourned such Meeting) and within the relevant time limit
specified by Euroclear or Clearstream, Luxembourg, as the case may
be, upon terms that the Notes will not cease to be so blocked until
the first to occur of the conclusion of the relevant Meeting or any
adjourned such Meeting and the surrender of the Voting Certificate
to the Tabulation Agent and notification by the Tabulation Agent to
Euroclear or Clearstream, Luxembourg, as the case may be, of such
surrender or the compliance in such other manner with the rules of
Euroclear or Clearstream, Luxembourg, as the case may be.
The Issuer notes that in accordance with advice issued by the
U.K. government following the COVID- 19 outbreak, non-essential
meetings continue to be discouraged under the guidance and that
there continue to be restrictions on the number of people that can
meet indoors. The Issuer is therefore convening the Meetings by way
of teleconference as opposed to holding a physical meeting. Details
of the teleconference will be provided to Noteholders requesting
Voting Certificates.
A Noteholder not wishing to attend and vote at the relevant
Meeting may either deliver the Voting Certificate to the person
whom it wishes to attend on its behalf or give a voting instruction
(in the form of an electronic voting instruction (an "Electronic
Voting Instruction") in accordance with the standard procedures of
Euroclear and/or Clearstream, Luxembourg) to, and require the
Principal Paying Agent to, include the votes attributable to its
Notes in a block voting instruction issued by the Principal Paying
Agent for the relevant Meeting or any adjourned such Meeting, in
which case the Principal Paying Agent shall appoint a proxy to
attend and vote at such Meeting in accordance with such
Noteholder's instructions.
If a Noteholder wishes the votes attributable to its Notes to be
included in a block voting instruction for the relevant Meeting or
any adjourned such Meeting, then (i) the Noteholder must arrange
for its Notes to be blocked in an account with Euroclear or
Clearstream, Luxembourg for that purpose and (ii) the Noteholder or
a duly authorised person on its behalf must direct the Principal
Paying Agent as to how those votes are to be cast by way of an
Electronic Voting Instruction, not less than 48 hours before the
time fixed for the relevant Meeting (or, if applicable, any
adjourned such Meeting) and within the time limit specified by
Euroclear or Clearstream, Luxembourg, as the case may be, upon
terms that the Notes will not cease to be so blocked until the
first to occur of (i) the conclusion of the relevant Meeting or any
adjourned such Meeting and (ii) not less than 24 hours before the
time for which the relevant Meeting is convened, the notification
in writing of any revocation of a Noteholder's previous
instructions to the Principal Paying Agent and the same then being
notified in writing by the Principal Paying Agent to the Issuer and
the Trustee and such Notes ceasing in accordance with the
procedures of Euroclear or Clearstream, Luxembourg, as the case may
be, and with the agreement of the Principal Paying Agent to be held
to its order or under its control.
Each Noteholder which arranges for an Electronic Voting
Instruction to be submitted must also confirm in such Electronic
Voting Instruction whether it is an Eligible Noteholder or an
Ineligible Noteholder. Noteholders voting pursuant to forms of
proxy will also be required to confirm whether they are an Eligible
Noteholder or an Ineligible Noteholder.
For the above purposes, instructions given by Direct
Participants to the Tabulation Agent through Euroclear or
Clearstream, Luxembourg will be deemed to be instructions given to
the Principal Paying Agent.
2. As the proposed amendment is a Basic Terms Modification (as
defined in the Trust Deed), the quorum required for each
Extraordinary Resolution to be considered at the relevant Meeting
is one or more persons present (including by teleconference) and
holding or representing in the aggregate not less than
three-quarters of the aggregate principal amount of the Notes of
the relevant Series for the time being outstanding.
In the event such quorum is not present (including by
teleconference) within 30 minutes from the time initially fixed for
a Meeting, such Meeting shall be adjourned until such date, not
less than 14 nor more than 42 days later, to be held via
teleconference. At any such adjourned Meeting one or more persons
present (including by teleconference) and holding or representing
in the aggregate not less than one-quarter of the aggregate
principal amount of the Notes of the relevant Series for the time
being outstanding will form a quorum.
Voting Certificates obtained and Electronic Voting Instructions
given in respect of any Meeting (unless revoked in accordance with
the terms of the Trust Deed and, in the case of Electronic Voting
Instructions, in accordance with the procedures of the Euroclear or
Clearstream, Luxembourg, as the case may be) shall remain valid for
any such adjourned Meeting.
Noteholders should note these quorum requirements and should be
aware that, if the Noteholders either present (including by
teleconference) or appropriately represented at the relevant
Meeting are insufficient to form a quorum for the relevant
Extraordinary Resolution, such Extraordinary Resolution cannot be
formally considered at such Meeting. Noteholders are therefore
encouraged either to attend the relevant Meeting (via
teleconference) or to arrange to be represented at the relevant
Meeting as soon as possible.
3. Every question submitted to a Meeting shall be decided in the
first instance by a show of hands and in case of equality of votes
the chairman of the relevant Meeting shall both on a show of hands
and on a poll have a casting vote in addition to the vote or votes
(if any) to which he may be entitled as a holder of a Voting
Certificate or as a proxy or as a representative.
Unless a poll is (before, or on the declaration of the result
of, the show of hands) demanded by the chairman of the relevant
Meeting, the Issuer, the Trustee or any person present holding or
representing not less than 2 per cent. of the principal amount
outstanding of the Notes of the relevant Series then outstanding, a
declaration by the chairman of the relevant Meeting that a
resolution has been carried or carried by a particular majority or
lost or not carried by a particular majority shall be conclusive
evidence of the fact without proof of the number or proportion of
the votes recorded in favour or against such resolution.
On a show of hands every person who is present and is a holder
of Notes or is a proxy or representative shall have one vote. On a
poll every such person shall have one vote in respect of each
GBP1,000 (or such other amount as the Trustee may, in its
discretion, stipulate) in aggregate principal amount outstanding of
the Notes of the relevant Series in respect of which he or she is a
holder, proxy or representative.
4. To be passed at the relevant Meeting, an Extraordinary
Resolution requires a majority of at least three-fourths of the
votes cast in respect of such Extraordinary Resolution. If passed,
an Extraordinary Resolution shall be binding on all Noteholders of
the relevant Series, whether or not present at the Meeting at which
it is passed and whether or not voting.
This Notice is given by Equity Release Funding (No.4) PLC.
Noteholders should contact the following for further
information:
The Solicitation Agent
NatWest Markets Plc
250 Bishopsgate
London EC2M 4AA
United Kingdom
Telephone: +44 20 7678 5222
Attention: Liability Management
Email: liabilitymanagement@natwestmarkets.com
The Tabulation Agent
Lucid Issuer Services Limited
Tankerton Works
12 Argyle Walk
London WC1H 8HA
United Kingdom
Telephone: +44 20 7704 0880
Attention: Owen Morris
Email: aviva@lucid-is.com
Dated: 13 July 2021
ANNEX 1 - COMPOUNDED DAILY SONIA
"Compounded Daily SONIA", means the rate of return of a daily
compound interest investment (with the daily Sterling overnight
reference rate as reference rate for the calculation of interest)
with respect to an Interest Period, will be calculated by the Agent
Bank on the relevant Interest Determination Date in accordance with
the following formula, and the resulting percentage will be
rounded, if necessary, to the fourth decimal place, with 0.00005%
being rounded upwards:
where:
"d" means, for any Interest Period, the number of calendar days
in such Interest Period;
"d o " means, for any Interest Period, the number of London
Banking Days in such Interest Period;
"i" means, for any Interest Period, a series of whole numbers
from one to "do", each representing the relevant London Banking Day
in chronological order from, and including, the first London
Banking Day in such Interest Period to, and including, the last
London Banking Day in such Interest Period;
"Interest Determination Date" means, in respect of any Interest
Period, the date falling 5 London Banking Days prior to the
Interest Payment Date for such Interest Period (or the date falling
5 London Banking Days prior to such earlier date, if any, on which
the Notes are due and payable);
"London Banking Day" or "LBD" means any day on which commercial
banks are open for general business (including dealing in foreign
exchange and foreign currency deposits) in London;
"n i " for any London Banking Day "i", in the relevant Interest
Period, the number of calendar days from, and including, such
London Banking Day "i" up to, but excluding, the following London
Banking Day;
"p" means 5 London Banking Days;
"Relevant Period" means, in respect of an Interest Period, the
period from, and including, the date falling 5 London Banking Days
prior to the first day of such Interest Period and ending on, but
excluding, the date which is "p" (5 London Banking Days) prior to
the Interest Payment Date for such Interest Period (or the date
falling "p" (5 London Banking Days) prior to such earlier date, if
any, on which the Notes become due and payable);
"SONIA Reference Rate" means, in respect of any London Banking
Day, a reference rate equal to the daily Sterling Overnight Index
Average ("SONIA") rate expressed as a percentage for such London
Banking Day as provided by the administrator of SONIA to authorised
distributors and as then published on Refinitiv Screen SONIA Page
(or if that page is unavailable, as otherwise is published by such
authorised distributors) (the "Screen Page") on the London Banking
Day immediately following such London Banking Day; and
"SONIA i-pLBD " means, in respect of any London Banking Day "i"
falling in the relevant Interest Period, the SONIA Reference Rate
for the London Banking Day falling "p" (5 London Banking Days)
prior to the relevant London Banking Day "i".
If, in respect of any London Banking Day in the applicable
Relevant Period, the Agent Bank determines that the SONIA Reference
Rate is not available on Refinitiv Screen SONIA Page or has not
otherwise been published by the relevant authorised distributors,
such SONIA Reference Rate shall be: (i) the Bank of England's Bank
Rate (the "Bank Rate") prevailing at close of business on the
relevant London Banking Day; plus (ii) the mean of the spread of
the SONIA Reference Rate to the Bank Rate over the previous five
London Banking Days on which a SONIA Reference Rate has been
published, excluding the highest spread (or, if there is more than
one highest spread, one only of those highest spreads) and lowest
spread (or, if there is more than one lowest spread, one only of
those lowest spreads) to the Bank.
Notwithstanding the paragraph above, in the event the Bank of
England (or working group thereof) publishes guidance as to (i) how
the SONIA Reference Rate is to be determined; or (ii) any rate that
is to replace the SONIA Reference Rate, the agent bank (or such
other party responsible for the calculation of the rate of
interest, as specified in the applicable final terms) shall,
subject to receiving written instructions from the Issuer to the
extent that it is reasonably practicable, follow such guidance in
order to determine SONIA (including any credit spread adjustment in
order to reduce or eliminate, to the extent reasonably practicable,
any transfer of economic value to or from the Issuer as a result of
the replacement or adjustment of SONIA) for the purpose of the
relevant calculation for so long as the SONIA Reference Rate is not
available or has not been published by the authorised
distributors.
If the Rate of Interest cannot be determined in accordance with
the foregoing provisions in relation to any Interest Period, the
Rate of Interest applicable to the Notes during such Interest
Period shall be that determined as at the last preceding Interest
Determination Date.
If the relevant Series of Notes become due and payable in
accordance with Conditions 9 (Events of Default) or 10 (Enforcement
of Notes), the final Interest Determination Date shall,
notwithstanding the definition specified above, be deemed to be the
date on which such Notes became due and payable and the Rate of
Interest on such Notes shall, for so long as any such Note remains
outstanding, be the rate determined on such date.
ANNEX 2 - MARGIN ADJUSTMENT
Rationale for the Noteholder Proposal
The formula for calculating interest on each Series of Notes
shall be as set out in Annex 1 to the Notice of Meetings. Due to
the differences in the nature of LIBOR and SONIA, the replacement
of LIBOR as the reference rate for each Series of Notes requires a
corresponding credit adjustment spread to the existing Relevant
Margin payable in respect of each Series of Notes. The Proposals
use the "5-year historical median" methodology agreed by the
International Swaps and Derivatives Association ("ISDA") for
determining this credit adjustment spread and recommended by the
Working Group for use in cash products such as the Notes. It
involves taking the median of the daily difference between 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 as of the date of
this Consent Solicitation Memorandum.
For the avoidance of doubt, the interest basis applicable to
each Series of Notes up to but excluding the Effective Date will
continue to be Sterling LIBOR, and interest payments made on the
Effective Date will not be affected by the pricing methodology
proposed in this Consent Solicitation Memorandum.
If, in respect of a Series of Notes, the Extraordinary
Resolution is passed at the adjourned Meeting and the Eligibility
Condition is satisfied, the modifications with respect to such
Series described in the Consent Solicitation Memorandum may be
implemented on the Implementation Date with effect from the
relevant Effective Date.
The Margin Adjustment
In respect of a Series of Notes, the Rate of Interest that will
be effective from the relevant Effective Date will be equal to
Compounded Daily SONIA plus the New Margin.
New Margin means:
A. the Current Margin; plus
B. the Relevant Credit Adjustment Spread,
where:
A. Current Margin means (i) in the case of the Class A2 Notes,
0.70 per cent., (ii) in the case of the Class B Notes, 1.50 per
cent., (iii) in the case of the Class C Notes, 3.30 per cent. and
(iv) in the case of the Class D Notes, 3.90 per cent.
B. Relevant Credit Adjustment Spread means 0.1193 per cent.
The detailed provisions relating to the calculation of
Compounded Daily SONIA are set out in the Supplemental Trust
Deed.
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END
MSCBBGDRRGBDGBX
(END) Dow Jones Newswires
July 13, 2021 07:09 ET (11:09 GMT)
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