TIDM73GD
RNS Number : 4746A
Transform Schools (N.Lanarks)FdgPLC
24 March 2017
THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF
BONDHOLDERS. IF BONDHOLDERS ARE IN ANY DOUBT AS TO THE ACTION THEY
SHOULD TAKE, THEY SHOULD CONSULT IMMEDIATELY THEIR OWN INDEPENT
PROFESSIONAL ADVISERS AUTHORISED UNDER THE FINANCIAL SERVICES AND
MARKETS ACT 2000 IF THEY ARE IN THE UNITED KINGDOM, OR OTHER
APPROPRIATELY AUTHORISED PROFESSIONAL ADVISERS.
NOTICE OF MEETING
GBP87,796,000, 2.343 per cent. Index-Linked Guaranteed Secured
Bonds due 2036 (including GBP15,000,000 in principal amount of
Variation Bonds)
(the Bonds)
(ISIN: XS0221413684)
issued by
TRANSFORM SCHOOLS (NORTH LANARKSHIRE) FUNDING PLC
(the Issuer)
Notice is hereby given that a meeting (the Meeting) of the
holders of the Bonds (the Bondholders) is convened for the purpose
of considering and, if thought fit, passing the extraordinary
resolution (the Extraordinary Resolution) described in detail
below, which will be proposed as an Extraordinary Resolution in
accordance with the Bond Trust Deed dated 8 June 2005 (the Bond
Trust Deed) between the Issuer, XL Capital Assurance (U.K.) Limited
(now Syncora Guarantee Inc. following a transfer by operation of
law pursuant to a court order dated 1 July 2015 under Part VII
(Control of Business Transfers) of the Financial Services and
Markets Act 2000 implemented on 2 July 2015 (Syncora US)) and
Prudential Trustee Company Limited (as the Bond Trustee).
The Meeting will be held at the offices of Freshfields Bruckhaus
Deringer LLP, 65 Fleet Street, London EC4Y 1HS, at 10.30 a.m.
(London time) on 25 April, 2017.
Unless defined in this Notice, words and expressions in this
Notice shall have the same meanings as given to them in the Bond
Trust Deed, the Collateral Deed dated 8 June 2005 (the Collateral
Deed) between, inter alios, the Issuer, Syncora US and the Bond
Trustee and the Master Definitions Schedule dated 8 June 2005 (the
Master Definitions Schedule) signed for the purposes of
identification by, inter alios, the Issuer, Syncora US and the Bond
Trustee.
In accordance with normal practice, the Bond Trustee (which has
not been involved in the formulation of the business to be
considered at the Meeting) makes no recommendation in connection
with this Notice and expresses no opinion on the merits (or
otherwise) of the Extraordinary Resolution, but has authorised it
to be stated that it has no objection to the Extraordinary
Resolution being submitted to the Bondholders for their
consideration.
The Issuer accepts responsibility for the information contained
in this Notice and confirms that, to the best of its knowledge
(having taken all reasonable care to ensure that such is the case),
the information contained in this Notice is in accordance with the
facts and does not omit anything likely to affect the import of
such information.
BACKGROUND TO, AND REASONS FOR, THE MEETING
Background
The Issuer is proposing that Assured Guaranty (Europe) Ltd.
(AGE) and Assured Guaranty Municipal Corp. (AGM and, together with
AGE, Assured Guaranty) provide financial guarantees in respect of
the Issuer's obligations under the Bonds, in substitution for
Syncora US's current rights and obligations, and that Syncora US be
released from its rights and obligations under the XLCA Financial
Guarantees and the other Finance Documents.
Neither S&P Global Ratings, a business unit of Standard
& Poor's Financial Services LLC (S&P), nor Moody's
Investors Service, Inc. (Moody's) currently rates Syncora US. The
underlying ratings of the Bonds are currently rated BBB by S&P.
At the date of this Notice, the financial strength of (i) AGE is
rated AA (stable outlook) by S&P and A2 (stable outlook) by
Moody's and (ii) AGM is rated AA (stable outlook) by S&P, A2
(stable outlook) by Moody's and AA+ (stable outlook) by Kroll Bond
Rating Agency, Inc. (KBRA). Thus, it is anticipated that the rating
assigned to the Bonds would be AA from S&P if the Proposed
Amendments (as defined below) are implemented. Accordingly, the
Issuer and ProjectCo are of the view that the credit quality of the
Bonds would be enhanced by the substitution of Assured Guaranty for
Syncora US and that Syncora US should be released from its rights
and obligations in respect of the Bonds and be replaced by Assured
Guaranty.
Assured Guaranty's Bond Guarantees
If the Extraordinary Resolution were approved and the Proposed
Amendments were implemented, Bondholders would receive a financial
guarantee from AGM (the AGM Bond Guarantee) and a financial
guarantee from AGE (the AGE Bond Guarantee, and together with the
AGM Financial Guarantee, the AG Bond Guarantees).
The AGE Bond Guarantee would cover 7% of the Bonds, with the
remaining 93% being covered by the AGM Bond Guarantee. Bondholders
would also benefit from a second to pay guarantee, providing that
in the event of AGE failing to pay any amount due pursuant to the
AGE Bond Guarantee, such amount would be paid by AGM under the AGM
Bond Guarantee (the Second Loss Guarantee).
Syncora US
Syncora US has confirmed to the Issuer that it is willing to be
replaced in its role on the transaction and does not object to the
Proposed Amendments.
European Investment Bank
The European Investment Bank (EIB) has not yet approved the
Proposed Amendments. The Proposed Amendments remain subject to
EIB's consent.
Conclusion
The release of Syncora US, the accession of Assured Guaranty as
the replacement Credit Provider, the anticipated increase in
S&P's ratings of the Bonds, and the implementation of the
Proposed Amendments summarised below are expected to provide
valuable credit enhancement to the Bonds for Bondholders.
RATINGS OF AGE AND AGM
At the date of this Notice, the financial strength of each of
(i) AGE is rated AA (stable outlook) by S&P and A2 (stable
outlook) by Moody's and (ii) AGM is rated AA (stable outlook) by
S&P, A2 (stable outlook) by Moody's and AA+ (stable outlook) by
KBRA. Each rating of AGE and AGM should be evaluated independently.
An explanation of the significance of the above ratings may be
obtained from the applicable rating agency. The above ratings are
not recommendations to buy, sell or hold any security, and such
ratings are subject to revision or withdrawal at any time by the
rating agencies, including withdrawal initiated at the request of
AGE or AGM in their sole discretion or by Assured Guaranty Ltd.,
their ultimate parent (together with its subsidiaries, AGL). In
addition, the rating agencies may at any time change AGE's or AGM's
long-term ratings outlook or place AGE's or AGM's ratings on a
watch list for possible downgrade in the near term. Any downward
revision or withdrawal of any of the above ratings, the assignment
of a negative outlook to such ratings or the placement of such
ratings on a negative watch list may have an adverse effect on the
market price of any security guaranteed by AGE or AGM.
AGE and AGM only guarantee scheduled principal and scheduled
interest payments payable by the issuer of bonds guaranteed by AGE
and AGM on the date(s) when such amounts were initially scheduled
to become due and payable (subject to and in accordance with the
terms of the relevant financial guarantee), and do not guarantee
the market price or liquidity of the securities that they
guarantee, nor do they guarantee that the ratings on such
securities will not be revised or withdrawn.
Current Financial Strength Ratings
On 27 July, 2016, S&P issued a credit rating report in which
it affirmed AGM's and AGE's financial strength rating of AA (stable
outlook). Neither AGM nor AGE can give any assurance as to any
further ratings action that S&P may take.
On 8 August, 2016, Moody's published a credit opinion affirming
its existing insurance financial strength rating of A2 (stable
outlook) on AGM and AGE. Neither AGM nor AGE can give any assurance
as to any further ratings action that Moody's may take.
On 14 December, 2016, KBRA issued a financial guaranty
surveillance report in which it affirmed AGM's insurance financial
strength rating of AA+ (stable outlook). AGM can give no assurance
as to any further ratings action that KBRA may take.
For more information regarding AGM's and AGE's financial
strength ratings and the risks relating thereto, see the Annual
Report of Assured Guaranty Ltd. on Form 10--K for the fiscal year
ended 31 December, 2016, which was filed with the Securities and
Exchange Commission (the SEC) on 24 February, 2017.
SUMMARY OF PROPOSED AMMENTS AND FORM OF EXTRAORDINARY
RESOLUTION
Proposed Amendments
The proposed amendments to the Bonds (the Proposed Amendments)
are as follows:
1. to release Syncora US as Credit Provider and replace it with
Assured Guaranty, as a result of which:
(a) AGE through the AGE Bond Guarantee will cover 7% of the
Bonds and AGM through the AGM Bond Guarantee will cover the
remaining 93% of the Bonds;
(b) AGM through the AGM Bond Guarantee will provide a Second
Loss Guarantee whereby AGM will pay any amounts due from but not
paid by AGE;
2. to confer Syncora US's rights and obligations as Credit Provider on Assured Guaranty;
3. to transfer Syncora US's rights and obligations under the
XLCA Guarantee and Reimbursement Agreement to Assured Guaranty
pursuant to which, inter alia, the Issuer and Transform Schools
(North Lanarkshire) Holdings Limited (HoldCo) will undertake to
reimburse Assured Guaranty for any amounts paid under the AG Bond
Guarantees (the AG Guarantee and Reimbursement Agreement); and
4. to transfer Syncora US's rights and obligations under the
XLCA Fee Letter to Assured Guaranty, with AGE and AGM assuming 7%
and 93% respectively of the rights and obligations contained
therein (the AG Fee Letter),
all as more particularly set out in the Amendment Documents (as
defined below).
In summary, therefore, the Issuer is seeking the consent of
Bondholders by way of Extraordinary Resolution for the Proposed
Amendments to be made to certain Senior Finance Documents as set
out in more detail below:
The Proposed Amendments shall be effected by way of:
(a) a supplemental bond trust deed modifying the provisions of
the Bond Trust Deed and incorporating amended and restated
Conditions of the Bonds;
(b) a Deed of Release, Transfer and Amendment by which the XLCA
Financial Guarantees, the XLCA Guarantee and Reimbursement
Agreement and the XLCA Fee Letter will be transferred to Assured
Guaranty and Syncora US will be released from all of its rights and
obligations under the Senior Finance Documents and such rights and
obligations will be assumed by Assured Guaranty;
(c) the assumption by Assured Guaranty of the rights and
obligations of Syncora US under the following documents with such
documents being amended to incorporate the Proposed Amendments (as
more particularly set out in the Extraordinary Resolution
below):
(i) the Master Definitions Schedule;
(ii) the XLCA Guarantee and Reimbursement Agreement;
(iii) the XLCA Financial Guarantees;
(iv) the Collateral Deed;
(v) the Accounts Mandate Agreement;
(vi) the Security Trust and Intercreditor Deed;
(vii) the Shareholders' Undertaking; and
(viii) the XLCA Fee Letter,
together the Amendment Documents, which amendments are proposed
to be executed following the passing of the Extraordinary
Resolution set out below (and subject to the consent of EIB).
EXTRAORDINARY RESOLUTION
of the holders of the Bonds
"THAT this Meeting (the Meeting) of the holders of those of the
GBP87,796,000 2.343 per cent. Guaranteed Secured Index--Linked
Bonds due 2036 of Transform Schools (North Lanarkshire) Funding PLC
(the Bonds and the Issuer respectively) presently outstanding
constituted by the Bond Trust Deed dated 8 June 2005 (the Bond
Trust Deed) made between the Issuer, XL Capital Assurance (U.K.)
Limited (now Syncora Guarantee Inc. following a transfer by
operation of law pursuant to a court order dated 1 July 2015 under
Part VII (Control of Business Transfers) of the Financial Services
and Markets Act 2000 implemented on 2 July 2015 (Syncora US)) and
Prudential Trustee Company Limited (as the Bond Trustee) as trustee
for the holders of the Bonds (the Bondholders) hereby:
(a) approves and assents to the following amendments set out in
this paragraph (a) (being referred to as the Proposed
Amendments):
(i) the release of Syncora US from its rights and obligations
in, to and under the XLCA Guarantee and Reimbursement Agreement,
the XLCA Bond Guarantee, the XLCA EIB Guarantee, the XLCA-NY EIB
Guarantee, the Master Definitions Schedule, the Collateral Deed,
the Accounts Mandate Agreement, the Security Trust and
Intercreditor Deed, the Shareholders' Undertaking and the XLCA Fee
Letter (the Amendment Documents) and the transfer to Assured
Guaranty (Europe) Ltd. (AGE) and Assured Guaranty Municipal Corp.
(AGM, together with AGE, Assured Guaranty) of all of Syncora US's
rights and obligations thereunder pursuant to a deed of release,
transfer and amendment to be entered into between inter alios, the
Issuer, Syncora US, AGE and AGM and the Bond Trustee following the
Meeting, if the Extraordinary Resolution is passed (the Deed of
Release, Transfer and Amendment), as a result of which, the Bonds
would have the benefit of a financial guarantee from AGM (the AGM
Bond Guarantee) and a financial guarantee from AGE (the AGE Bond
Guarantee and together with the AGM Financial Guarantee, the AG
Bond Guarantees) with the AGE Bond Guarantee covering 7% of the
Bonds, with the remaining 93% being covered by the AGM Bond
Guarantee. Bondholders would also benefit from a second to pay
guarantee, providing that in the event of AGE failing to pay any
amount due pursuant to the AGE Bond Guarantee, such amount would be
paid by AGM under the AGM Bond Guarantee (the Second Loss
Guarantee);
(ii) consequential amendments to the Amendment Documents
pursuant to the Deed of Release, Transfer and Amendment to reflect
the assumption by AGE and AGM of Syncora US's rights and
obligations under the Amendment Documents;
(iii) the accession of AGE and AGM to the Bond Trust Deed
pursuant to a Supplemental Bond Trust Deed to be entered into
between AGE, AGM, Syncora US, the Issuer and the Bond Trustee
following the Meeting if the Extraordinary Resolution is passed
(the Supplemental Bond Trust Deed) pursuant to which AGE and AGM
are to become bound by the provisions of the Bond Trust Deed (as
modified by the Supplemental Bond Trust Deed as defined below)
relating to Syncora US's rights and obligations;
(iv) the modification of the Bond Trust Deed (including the
Conditions of the Bonds set out in Schedule 4 of the Bond Trust
Deed) by way the Supplemental Bond Trust Deed;
(v) all of the modifications to Schedule 4 of the Bond Trust
Deed (which sets out the Conditions of the Bonds) pursuant to the
Supplemental Trust Deed (to be appended to the Supplemental Bond
Trust Deed), such amendments including, inter alia:
(A) the first paragraph of the Conditions of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"The issue of the GBP87,796,000 2.343% Guaranteed Secured
Index-Linked Bonds due 2036 (including up to GBP15,000,000 in
principal amount of Variation Bonds (as defined in Condition 1(d))
(the "Bonds", which expression includes any further bonds issued
pursuant to Condition 21 (Further Issues) and forming a single
series therewith) was authorised by a resolution of the Board of
Directors of Transform Schools (North Lanarkshire) Funding plc (the
"Issuer") passed on 1 June 2005. The Bonds are subject to, and have
the benefit of, a bond trust deed dated on or around 8 June 2005
(the "Issue Date") (as amended or supplemented from time to time,
the "Bond Trust Deed") between the Issuer, XL Capital Assurance
(U.K.) Limited ("XLCA"Assured Guaranty (Europe) Ltd. ("AGE"),
Assured Guaranty Municipal Corp. ("AGM", and together with AGE,
"Assured Guaranty") and Prudential Trustee Company Limited as Bond
Trustee (the "Bond Trustee", which expression includes all persons
for the time being bond trustee or bond trustees appointed under
the Bond Trust Deed). These terms and conditions include summaries
of and are subject to the detailed provisions of the Bond Trust
Deed, which includes the form of the Bonds, the Receipts and the
Coupons (as defined below) relating to them and the Security Trust
and Intercreditor Deed (as hereinafter defined) to be dated 8 June
2005 (the "Issue Date").";
(B) the second paragraph of the Conditions of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"The Bonds are unconditionally and irrevocably guaranteed as to
scheduled payments of principal and interest (but excluding Default
Interest (as defined in Condition 5(a)) and any excess above the
outstanding principal amount payable in accordance with these
Conditions in certain cases of early redemption and acceleration)
in respect of the Bonds, pursuant to a financial guarantee provided
by AGE (originally dated 8 June 2005 and amended and restated on
[--] 2017) (the "XLCA"AGE Bond Guarantee") issued by XLCA") and a
financial guarantee provided by AGM (originally dated 8 June 2005
and amended and restated on [--] 2017) (the "AGM Bond Guarantee"
and, together with the AGE Bond Guarantee, the "AG Bond
Guarantees").";
(C) the third paragraph of the Conditions of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"Payments in respect of the Bonds will be made pursuant to a
paying agency agreement the Issue Date dated 8 June 2005 (the
"Issue Date") (as amended or supplemented from time to time, the
"Paying Agency Agreement") between the Issuer, the Bond Trustee,
The Bank of New York Mellon, London Branch as principal paying
agent (the "Principal Paying Agent", which expression includes any
successor principal paying agent appointed under the Paying Agency
Agreement and together with any additional or successor paying
agent appointed in accordance with the Paying Agency Agreement, the
"Paying Agents").";
(D) the fourth paragraph of the Conditions of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"The holders of the Bonds (the "Bondholders"), the holders of
the related principal receipts (the "Receiptholders" and the
"Receipts", respectively) and the holders of the related interest
coupons (the "Couponholders" and the "Coupons", respectively) will
be entitled to the benefit of, will be bound by and are deemed to
have notice of, all the provisions of the Bond Trust Deed, the
XLCAAG Bond GuaranteeGuarantees, the Collateral Deed (as defined in
Condition 2(e)), the Security Documents (as defined in Condition
2(d)) and the Paying Agency Agreement applicable to them and the
master definitions schedule dated on or before the Issue Date and
for the purpose of identification signed by or on behalf of the
parties to the transaction and the other Finance Documents to which
the Bond Trustee or Security Trustee are party (the "Master
Definitions Schedule"). Capitalised terms used but not defined
herein shall have the meanings given to them in the Master
Definitions Schedule.";
(E) the fifth paragraph of the Conditions of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"Copies of the Bond Trust Deed, the XLCAAG Bond
GuaranteeGuarantees, the Collateral Deed, the Security Documents,
the Paying Agency Agreement and the Master Definitions Schedule are
available for inspection by Bondholders, Receiptholders and
Couponholders during normal business hours at the principal office
for the time being of the Bond Trustee being at the date hereof
Laurence Pountney Hill, London EC4R 0HH and at the specified
offices of each of the Paying Agents for the time being.";
(F) Condition 2(b) (XLCA Bond Guarantee) of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(b) XLCAAG Bond GuaranteeGuarantees
The Bonds (except any Bonds to the extent that they are then
held by or on behalf of a member of the Issuer Group (as defined
below)) have the benefit of the XLCAAG Bond Guarantee, to be dated
on or about the Issue DateGuarantees. Pursuant to the XLCAAG Bond
Guarantee, XLCAGuarantees, under which (i) AGE has unconditionally
and irrevocably guaranteedagreed to pay to the Bond Trustee 7% of
all sums due (other than Default Interest (as defined in Condition
5(a)) or any additional amounts relating to an early redemption or
acceleration) and payable but unpaid by the Issuer in respect of
scheduled principal and interest (in each case adjusted for
indexation in accordance with these Conditions) on the Bonds
(excluding those held by any Obligor or any of their Subsidiaries)
and (ii) AGM has unconditionally and irrevocably agreed to pay to
the Bond Trustee the remaining 93% of the aforementioned sums,
together with a guarantee from AGM to pay any sums due and payable
but unpaid by AGE, all as more particularly described in the XLCAAG
Bond GuaranteeGuarantees.
The terms of the XLCAAG Bond GuaranteeGuarantees provide that
amounts which become due under the Bonds on an accelerated basis
(whether by virtue of any default by the Issuer, any mandatory or
optional redemption or any other cause) will not be guaranteed by
XLCAAssured Guaranty other than on the relevant Scheduled Payment
Date (as defined in Condition 4) unless XLCAAssured Guaranty in its
sole discretion elects so to do. If no such election is made,
XLCAAssured Guaranty will continue to be liable to make payments in
respect of the Bonds pursuant to the XLCAAG Bond
GuaranteeGuarantees in such amounts and at such times as payments
would have been due had there not been any such acceleration.";
(G) Condition 2(c) (Status of XLCA Bond Guarantee) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(c) Status of XLCAAG Bond GuaranteeGuarantees
The XLCAAG Bond GuaranteeGuarantees constitute a direct,
unsecured obligation of XLCAobligations of Assured Guaranty which
will rank at least pari passu with all other unsecured obligations
of XLCAAssured Guaranty, save for such obligations as may be
preferred by provisions of law that are both mandatory and of
general application.";
(H) Condition 2(d)(i) (Security) of the Bonds being deleted and
replaced with the following provision (the modifications are shown
in blackline below):
"(i) a security trust and intercreditor deed dated on or before
the Issue Date (as amended and restated on [--] 2017 and as
amended, supplemented or replaced from time to time,) (the
"Security Trust and Intercreditor Deed") between, inter alios,
Balfour Beatty Infrastructure InvestmentsEquitix Education 2
Limited and Innisfree Nominees Limited as nominee for Innisfree PFI
Secondary Fund LP and Innisfree PFI Secondary Fund III2 LP
(together, the ("Shareholders"), the Issuer Transform Schools
(North Lanarkshire) Limited ("ProjectCo") and Transform Schools
(North Lanarkshire) Holdings Limited ("HoldCo" and, together with
the Issuer and ProjectCo, the "Obligors"), Prudential Trustee
Company Limited as security trustee (the "Security Trustee", which
expression includes all persons for the time being security trustee
or security trustees appointed under the Security Trust and
Intercreditor Deed), the Bond Trustee (for itself and on behalf of
the Bondholders), European Investment Bank ("EIB") and XL Capital
Assurance Inc. ("XLCA-NY")Assured Guaranty.;
(I) Condition 2(e) (Collateral Deed and Shareholders'
Undertaking) of the Bonds being deleted and replaced with the
following provision (the modifications are shown in blackline
below):
"(e) (Collateral Deed and Shareholders' Undertaking)
The Bond Trustee on behalf of the Bondholders has the benefit of
certain representations and covenants set out in a collateral deed
(the "Collateral Deed"), dated on or about the Issue Date8 June
2005, as amended on [--] 2017 between, inter alios, the Obligors,
XLCAAssured Guaranty, the Security Trustee, the Bond Trustee and
EIB.
The Security Trustee, as trustee for, amongst others, the
Bondholders has the benefit of certain warranties and undertakings
set out in the shareholders' undertaking amongst the Security
Trustee, the Shareholders and XLCAAssured Guaranty (the
"Shareholders' Undertaking").";
(J) The definitions of "Bond Creditor", "Credit Provider",
"Senior Creditors", "XLCA Event of Default" and "XLCA Non-Payment
Event of Default" in Condition 2(g) (Definitions) of the Bonds
being deleted and replaced with the following definitions (the
modifications are shown in blackline below):
""Bond Creditor" means, at any time, XLCAAssured Guaranty,
unless and until such time as the Security Trustee has received
notice from:
(A) the Bond Trustee that an XLCAAG Event of Default has
occurred; and/or
(B) EIB that an EIB XLCAAG Event of Default has occurred,
in which case the Bond Trustee shall be the Bond Creditor
(unless such XLCAAG Event of Default has been remedied to the
satisfaction of or waived by the Bond Trustee and/or such XLCA EIB
AG Event of Default has been cured to the satisfaction of or waived
by EIB)."
""Credit Provider" means, at any time, XLCAAssured Guaranty,
unless and until such time as the Security Trustee has received a
notice (a copy of which shall be served on XLCAAssured Guaranty)
from:
(A) the Bond Trustee that an XLCAAG Event of Default has
occurred; and/or
(B) EIB that an EIB XLCAAG Event of Default has occurred,
in which case, unless such XLCAAG Event of Default has been
remedied to the reasonable satisfaction of the Bond Trustee or
waived by the Bond Trustee and/or such EIB XLCAAG Event of Default
has been cured to the satisfaction of EIB or waived by EIB, it
means the Bond Trustee."
""XLCAAG Event of Default" means any of the following
events:
(A) XLCAAGM Non-Payment Event of Default;
(B) XLCAAGM disclaims, disaffirms, repudiates and/or challenges
the validity of any of its obligations under the XLCAAGM Bond
Guarantee or seeks to do so (in writing);
(C) (i) a court of competent jurisdiction, the New York
Department of Insurance or other competent regulatory authority
enters a final and non-appealable order, judgment or decree for the
winding-up, or (ii) the appointment of an administrator(i)
appointing a custodian, trustee, agent, or receiver (including an
administrative receiver or manager), of XLCA (or, as the case may
be, of afor AGM or for all or any material partportion of its
property or assets);(ii) authorising the taking or possession by a
custodian, trustee, agent or receiver of AGM or of all or any
material portion of its property; or;
(D) AGM (i) files a petition or commences a case or proceeding
under any provision or chapter of the United States Bankruptcy Code
or any other similar federal or state law relating to insolvency,
bankruptcy, liquidation or reorganisation, or (ii) makes a general
assignment for the benefit of its creditors, or (iii) has a final
and non--appealable order for relief entered against it under the
United States Bankruptcy Code or any other similar federal or state
law relating to insolvency, bankruptcy, liquidation or
reorganisation."
(D) XLCA:
(i) presents any petition or takes any formal steps or
proceedings for the winding-up, or the appointment of an
administrator or receiver (including an administrative receiver or
manager), of XLCA (or, as the case may be, of a material part of
its property or assets);
(ii) makes or enters into any general assignment, composition,
arrangement (including, a voluntary arrangement under Part I of the
Insolvency Act 1986) or compromise with or for the benefit of any
of its creditors;
(iii) becomes unable to pay its debts within the meaning of
section 123(2) or section 123(1)(e) of such Insolvency Act or
admits in writing its inability, or fails generally, to pay its
debts as they become due; or
(E) at any time it is or becomes unlawful for XLCA to perform or
comply with any part or all of its obligations under the XLCA EIB
Guarantee or the XLCA Bond Guarantee or any of its obligations
thereunder are not or cease to be legal, valid or binding.
""XLCAAGM Non-Payment Event of Default" means any guaranteed
amount which is due for payment andby AGM in accordance with the
terms of the AGM Bond Guarantee is not paid by XLCAAGM on the date
stipulated in the XLCAAGM Bond Guarantee.";
"Senior Creditors" means each of XLCAAssured Guaranty, EIB, the
Bond Trustee, the Bondholders, the Hedging Provider and the
Security Trustee and "Senior Creditor" means each of them.";"
"XLCA EIB AG Event of Default" has the meaning given to that
term in the Security Trust andintercreditor Intercreditor
Deed."
(K) Condition 6(b) (Issuer Optional Redemption) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(b) Issuer Optional Redemption
The Issuer may at any time, subject to the approval of
XLCAAssured Guaranty if it is the Bond Creditor, having given not
less than 30 nor more than 60 days' notice of redemption to the
Bondholders in accordance with Condition 17 (which notice shall be
irrevocable and shall oblige the Issuer to redeem the Bonds),
redeem all (but not some only) of the Bonds in whole, but not in
part, at an amount (the "Early Redemption Price") equal to the
higher of the following:
(i) the Outstanding Principal Amount of that Bond multiplied by
the Limited Index Ratio (as defined in Condition 7(a)) applicable
to the month in which the redemption takes place (the "Indexed
Outstanding Balance"); and
(ii) the Outstanding Principal Amount of that Bond on the date
of redemption multiplied by the price (as reported to the Bond
Trustee and the Issuer by the Indexation Adviser (as defined in
Condition 7(a))) expressed as a percentage and rounded up to four
decimal places at which the Gross Real Redemption Yield (as defined
below) of such Bond on the Reference Date would be equal to the
Gross Real Redemption Yield at 3.00 p.m. on such day of the
Reference Gilt;
together with:
(iii) any payment of principal and interest due but unpaid on or
prior to the Reference Date (as defined above); and
(iv) any interest (other than under (a) above) accrued up to,
but excluding the date of redemption, all adjusted for indexation
in accordance with Condition 7,
provided, however, that no such notice of redemption shall be
given pursuant to this paragraph unless the Issuer has delivered to
the Bond Trustee and XLCAAssured Guaranty, if it is then the Credit
Provider, a certificate signed by two directors of the Issuer
stating that the Issuer will have sufficient funds, not subject to
the interest of any other person, to pay the Early Redemption Price
and meet all other payment obligations outstanding on the proposed
date of redemption of the Bonds.
Such method requires the adoption of an assumed inflation rate
which shall be the rate equal to the inflation assumption specified
by the DMO Notice or, such rate as the Indexation Adviser after
taking the advice of those persons operating as index-linked gilt
market makers may determine appropriate. For the avoidance of
doubt, the assumed inflation rate shall be a long term inflation
rate for the life of the Bonds.
For the purposes of these Conditions:
"Gross Real Redemption Yield" means a yield calculated on the
basis set out by the United Kingdom Debt Management Office in the
paper "Formulae for calculating Gilt Prices from Yields" page 5,
Section One: Price/Yield Formulae "Index-linked Gilts"(published
8/6/1998 with effect from 1/11/98 and updated on 15/1/02) (as
supplemented, amended or replaced from time to time) (the "DMO
Notice"). In this paragraph "business day" means any day on which
commercial banks and foreign exchange markets are open for business
in London; and
"Reference Date" means the date which is two business days prior
to the dispatch of the notice of redemption under this Condition
6(b).";
(L) Condition 6(e) (Unscheduled Redemption for Index Reasons) of
the Bonds being deleted and replaced with the following provision
(the modifications are shown in blackline below):
"(c) Unscheduled Redemption for Index Reasons
If either:
(i) the Index Figure (as defined in Condition 7) for three
consecutive months fails to be determined on the basis of an Index
Figure previously published as provided in Condition 8(b)(ii) and
the Bond Trustee has been notified by the Principal Paying Agent
that publication of the Index (as defined in Condition 7) has
ceased; or
(ii) notice is published by Her Majesty's Treasury, or on its
behalf, following a change in relation to the Index, offering a
right of redemption to holders of the Reference Gilt,
and (in either case) no amendment or substitution of the Index
shall have been agreed or determined pursuant to Condition 8(c) and
such circumstances are continuing, having given not more than 60
nor less than 30 days' notice to Bondholders in accordance with
Condition 17, the Issuer may, subject to the consent of XLCAAssured
Guaranty so long as XCLAAssured Guaranty is the Bond Creditor,
redeem all, but not some only, of the Bonds at their Outstanding
Principal Amount so long as XLCAAssured Guaranty is the Bond
Creditor together with interest accrued up to and including the
date of redemption, the Limited Index Ratio for this purpose being
that applicable to the month in which redemption takes place.".
The Conditions numbered 6(f) (No other Redemption) and (6(h)
(Cancellation) shall be renumbered 6(d) and 6(f) respectively;
(M) Condition 6(g) (Purchase) of the Bonds being deleted and
replaced with the following provision (the modifications are shown
in blackline below):
"(e) Purchase
The Issuer may at any time purchase Bonds in the open market or
otherwise and at any price in individually negotiated transactions,
provided that all unmatured Receipts, Coupons and unexchanged
Talons appertaining thereto are purchased therewith. Any purchase
by tender by the Issuer shall be made available to all Bondholders
alike (other than any purchase by the Issuer within five Business
Days of the Issue Date). Any Bonds so purchased will not be treated
as outstanding for the purpose of, inter alia, determining quorum
or voting of meetings of Bondholders, save as provided otherwise in
the Bond Trust Deed and will not have the benefit of the XLCAAG
Bond GuaranteeGuarantees. In this Condition, "business day" means a
day on which commercial banks and foreign exchange markets are open
for business in London.";
(N) the definition of "Indexation Adviser" in Condition 7(a)
(Definitions) of the Bonds being deleted and replaced with the
following definition (the modifications are shown in blackline
below):
"Indexation Adviser" means a leading broker, primary dealer or
other expert operating in the index-linked gilt market selected by
the Issuer and XLCAAssured Guaranty (so long as XLCAAssured
Guaranty is the Bond Creditor) and approved by the Bond Trustee
(such approval not to be unreasonably withheld or delayed).";
(O) Condition 8(b) (Delay in Publication of Index) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(b) Delay in Publication of Index
If the Index Figure which is normally published in the Monthly
Digest of Statistics in the seventh month and which relates to the
eighth month (the "relevant month") before the month in which a
payment is due to be made is not published on or before the
fourteenth business day before the date (the "date for payment") on
which such payment is due, the Index Figure applicable to the month
for which the date of payment falls shall be:
(i) such substitute index figure (if any) as the Bond Trustee,
with the agreement of XLCAAssured Guaranty (so long as XLCAAssured
Guaranty is the Bond Creditor), determines to have been published
by the Bank of England or such other body designated by the UK
Government for such purpose for the purposes of indexation of
payments on the Reference Gilt or, failing such publication, on any
one or more issues of index-linked Treasury stock selected by the
Indexation Adviser (and approved by XLCAAssured Guaranty (so long
as XLCAAssured Guaranty is the Bond Creditor)); or
(ii) if no such determination or selection is made by the Bond
Trustee or (as the case may be) the Indexation Adviser within seven
days, the Index Figure last published (or, if later, the substitute
Index Figure last determined pursuant to Condition 8(a)(i)) before
the date for payment.
Where the provisions of this Condition 8(b) apply, the
determination of the Bond Trustee or (as the case may be)
Indexation Adviser as to the Index Figure applicable to the month
in which the date for payment falls shall be conclusive and
binding. If, an Index Figure having been applied pursuant to
Condition 8(b)(ii), the Index Figure relating to the relevant month
is subsequently published while a Bond is still outstanding,
then:
(A) in relation to a payment of principal or interest in respect
of such Bond other than upon final redemption of such Bond, the
principal or interest (as the case may be) next payable after the
date of such subsequent publication shall be increased or reduced
by an amount equal to (respectively) the shortfall or excess of the
amount of the relevant payment made on the basis of the Index
Figure applicable by virtue of Condition 8(b)(ii), below or above
the amount of the relevant payment that would have been due if the
Index Figure subsequently published had been published on or before
the fourteenth business day before the date for payment; and
(B) in relation to a payment of principal or interest upon final
redemption, no subsequent adjustment to amounts paid will be
made.";
(P) Condition 8(c) (Cessation of or fundamental changes to the
Index) of the Bonds being deleted and replaced with the following
provision:
"(c) Cessation of or fundamental changes to the Index
(i) If (a) the Bond Trustee has been notified by the Principal
Paying Agent that the Index has ceased to be published; or (b) any
change is made to the coverage or the basic calculation of the
Index which constitutes a fundamental change which would, in the
opinion of the Bond Trustee acting solely on the advice of the
Indexation Adviser, be materially prejudicial to the interests of
the Bondholders, the Bond Trustee will give written notice of such
occurrence to the Issuer and XLCAAssured Guaranty (so long as
XLCAAssured Guaranty is the Bond Creditor) (the "Parties"), and the
Parties and the Bond Trustee together shall seek to agree for the
purpose of the Bonds one or more adjustments to the Index or a
substitute index (with or without adjustments) with the intention
that the same should leave the Parties and the Bondholders in no
better and no worse a position than they would have been had the
Index not ceased to be published or the relevant fundamental change
not been made;
(ii) If the Parties and the Bond Trustee fail to reach agreement
as mentioned above within 20 business days following the giving of
notice as mentioned in Condition 8(c)(i) a bank or other person in
London shall be appointed by the Parties and the Bond Trustee, or,
failing agreement on and the making of such appointment within 20
business days following the expiry of the 20 business day period
referred to above, by the Bond Trustee (in either case, such bank
or other person so appointed being referred to as the "Expert"), to
determine for the purpose of the Bonds one or more adjustments to
the Index or a substitute index (with or without adjustments) with
the intention that the same should leave the Parties and the
Bondholders in no better and no worse a position than they would
have been had the Index not ceased to be published or the relevant
fundamental change not been made. Any Expert so appointed shall act
as an expert and not as an arbitrator and all fees, costs and
expenses of the Expert and of the Indexation Adviser and of either
of the Parties and the Bond Trustee in connection with such
appointment shall be borne by the Issuer. In this Condition
"business day" means any day on which commercial banks and foreign
exchange markets are open for business in London.
(iii) The Index shall be adjusted or replaced by a substitute
index as agreed by the Parties and the Bond Trustee or as
determined by the Expert pursuant to the foregoing paragraphs, as
the case may be, and references in these Conditions to the Index
and to any Index Figure shall be deemed to be amended in such
manner as the Issuer, the Bond Trustee and XLCAAssured Guaranty (so
long as XLCAAssured Guaranty is the Bond Creditor) agree, and the
Issuer notifies to the Parties, as appropriate, and to the
Bondholders in accordance with Condition 17 to give effect to such
adjustment or replacement. Such amendments shall be effective from
the date of such notification and shall be binding upon the
Parties, the Bond Trustee and the Bondholders.";
(Q) Condition 10 (Taxation) of the Bonds being deleted and
replaced with the following provision (the modifications are shown
in blackline below):
"10 (Taxation)
All payments of principal and interest in respect of the Bonds
by or on behalf of the Issuer shall be made free and clear of, and
without withholding or deduction for, any taxes, duties,
assessments or governmental charges of whatsoever nature imposed,
levied, collected, withheld or assessed by any jurisdiction or any
political subdivision or any authority thereof or therein having
power to tax, unless such withholding or deduction is required by
law. In that event, the Issuer shall account to the relevant
authorities for the amount to be withheld or deducted and shall
make such payment of principal or interest, as the case may be,
after such withholding or deduction has been made.
The Issuer shall notify the Bond Trustee and XLCAAssured
Guaranty (for so long as it is the Bond Creditor) of any such
withholding or deduction and shall take reasonable measures
available to it to avoid such obligation including the replacement
of the Principal Paying Agent, the addition, replacement or removal
of a Paying Agent or changing the specified office of any Paying
Agent. Should the Issuer still be obliged to make the withholding
or deduction, it will, on written request from any Bondholder,
provide to the Bondholder copies of any documentation or
correspondence with the tax authority regarding the deduction or
withholding as the Bondholder may reasonably require to assist it
to reclaim such deduction or withholding.
The Issuer will not be obliged to make any additional payments
to Bondholders, Receiptholders or Couponholders in respect of any
such withholding or deduction.
(R) Condition 11 (Events of Default) of the Bonds being deleted
and replaced with the following provision (the modifications are
shown in blackline below):
"11. Events of Default
(a) Except in the circumstances described in Condition 11(b) and
subject to Condition 11(e) below, if any event of default pursuant
to the terms of the Collateral Deed (an "Event of Default") occurs
and has not been waived by, or remedied to the satisfaction of, the
Credit Provider in accordance with the Collateral Deed, then:
(i) if and for so long as XLCAAssured Guaranty is the Bond
Creditor, the Bond Trustee shall, upon being (a) so directed by
XLCAAssured Guaranty (except in certain circumstances in which both
XLCAAssured Guaranty and EIB shall make such direction) in
accordance with the Security Trust and Intercreditor Deed and (b)
indemnified or furnished with security to its satisfaction, declare
by written notice to the Issuer that the Bonds are immediately due
and payable; and
(ii) if and for so long as XLCAAssured Guaranty is not the Bond
Creditor, the Bond Trustee may at any time and shall, upon being
(a) so requested in writing by the holders of at least 25 per cent.
In outstanding principal amount of the outstanding bonds or so
directed by a resolution passed at any meeting of the Bondholders
by a majority of not less than three quarters of the votes cast (an
"Extraordinary Resolution") and (b) indemnified or furnished with
security to its satisfaction, declare by written notice to the
Issuer that the Bonds are immediately due and payable,
whereupon each Bond shall become due and payable at the Default
Amount (as defined below) together with accrued interest up to and
including the date of redemption adjusted for indexation (the Index
Ratio for this purpose being that applicable to the month in which
the date on which the notice is given that the Bonds are
immediately due and payable falls), without further formality or
action.
(b) If:
(i) the project agreement (the "Project Agreement") dated on or
before the Issue Date between ProjectCo and North Lanarkshire
Council (the "Authority") is terminated as a result of any of the
Spens Acceleration Events (and the Authority does not exercise the
Instalment Option (as defined below);
(ii) an amount equal to the sum of (A) the Default Amount
together with accrued interest thereon and (B) the full termination
amount payable to EIB under the EIB Loan Agreement (as defined in
the Master Definitions Schedule) following such termination, is
paid into an account designated by the Issuer and/or the Security
Trustee which is secured in favour of the Security Trustee pursuant
to the Issuer Debenture;
(iii) the Bond Trustee receives a Sufficiency Certificate from
the Security Trustee confirming receipt of proceeds (in liquid
form, including in the form of Authorised Investments) from an
Enforcement of the Security equal to or in excess of the aggregate
of the Senior Beneficiary's Claim Certificates (each as defined in
the Master Definitions Schedule or the Security Trust and
Intercreditor Deed (as applicable)) in accordance with the terms of
the Security Trust and Intercreditor Deed; and
(iv) the Bonds have not previously been declared due and payable
pursuant to Condition 11 (a)(i) or (ii) above,
then each Bond shall become immediately due and payable by the
Issuer at the Default Amount together with accrued interest thereon
adjusted for indexation (the Limited Index Ratio being as referred
to in Condition 11(c)).
(c) For the purposes of this Condition 11, "Default Amount" means, in respect of each Bond:
(i) in the event of an Event of Default triggered by:
(A) ProjectCo terminating the Project Agreement, as a result of
a default by the Authority under the terms of the Project Agreement
pursuant to clause 35.3 (Authority Default Termination) of the
Project Agreement ("Authority Default"); or
(B) the Authority voluntarily terminating the Project Agreement
pursuant to clause 35.2.2 (Termination by the Authority) of the
Project Agreement ("Authority Voluntary Termination"); or
(C) ProjectCo or the Authority terminating the Project Agreement
pursuant to any of clauses 39 (Force Majeure), 79.2 (Termination
for Corrupt Gifts and Fraud) or 86 (Termination for Breach of the
Refinancing Provisions) and the Authority electing to pay the
termination sum payable under the Project Agreement by instalments
(the "Instalment Option") and initially satisfying the conditions
applicable to the exercise of the Instalment Option set out in the
Project Agreement and the Authority subsequently either failing to
satisfy the conditions specified in the Project Agreement in
relation to the Instalment Option or defaulting in the payment of
any such instalments or electing to discontinue paying the
termination sum by instalments,
(each, a "Spens Acceleration Event"), the Outstanding Principal
Amount of the relevant Bond multiplied by the higher of:
(1) the Limited Index Ratio applicable to the month in which the
date on which the notice is given that the Bonds are immediately
due and payable falls; and
(2) the price (as reported to the Bond Trustee and the Issuer by
a leading broker and, or primary dealer operating in the gilt-edged
market selected by the Indexation Adviser expressed as a percentage
and rounded up to four decimal places at which the Gross Real Yield
(as defined below) of such Bonds (if the Bonds were to remain
outstanding to their original maturity) on the Reference Date (as
defined below) would be equal to the Gross Real Redemption Yield
(determined by the middle-market price) at 3.00 p.m. on the
Reference Date of the Reference Gilt (as defined in Condition 1(c)
above).
For the purposes of this Condition 11, "Reference Date" means
the date which is two business days prior to dispatch of the notice
of redemption under Condition 6(b) and "Gross Real Yield" means a
yield expressed as a percentage and calculated on a basis
consistent with the basis indicated by the United Kingdom Debt
Management Office publication "Formulae for Calculating Gilt Prices
from Fields" published on 8 June 1998 with effect from 1 November
1998 and updated on 15 January 2002, page 5 or any replacement
thereof. Such method requires the adoption of an assumed inflation
rate which shall be such rate as the Indexation Adviser may
determine to be appropriate. For the avoidance of doubt, the
assumed inflation rate shall be a long term inflation rate for the
life of the Bonds; and
(ii) in all other circumstances, the Outstanding Principal
Amount of the relevant Bond multiplied by the Limited Index Ratio
applicable to the month in which the date on the notice is given
that the Bonds are immediately due and payable falls (the "Indexed
Par Amount").
(d) Following the determination of the amount payable pursuant
to this Condition 11, the Issuer shall forthwith notify or procure
the notification of the Bondholders in accordance with Condition
17, the Principal Paying Agent, the Bond Trustee, the Security
Trustee, XLCAAssured Guaranty and the Authority of such amount.
(e) In the event that the Project Agreement has been terminated
in circumstances where the Authority has exercised the Instalment
Option, then for so long as the Authority continues to make the
payments in an amount equal to scheduled principal and interest
under the Bonds pursuant to the Instalment Option and satisfies the
conditions applicable to the exercise of the Instalment Option as
set out in the Project Agreement, XLCAAssured Guaranty may only
exercise the rights under Condition 11(a) with the consent of the
Bond Trustee.";
(S) Condition 14(a) (Bond Trustee entitled to be indemnified) of
the Bonds being deleted and replaced with the following provision
(the modifications are shown in blackline below):
"(a) Bond Trustee entitled to be indemnified
Under the Bond Trust Deed, the Bond Trustee is entitled to be
indemnified and relieved from responsibility in certain
circumstances and to be paid its remuneration, costs and expenses
in priority to the claims of the Bondholders. In addition, the Bond
Trustee is entitled to enter into business transactions with the
Issuer, ProjectCo, HoldCo, XLCAAssured Guaranty, the Bondholders,
the Couponholders and any entity related to the Issuer, ProjectCo,
HoldCo, XLCAAssured Guaranty, any Bondholder or Couponholder or any
such other person without accounting for any profit.";
(T) Condition 14(b) (Bond Trustee to have regard to Bondholders
as a Class) of the Bonds being deleted and replaced with the
following provision (the modifications are shown in blackline
below):
"(b) Bond Trustee to have regard to Bondholders as a Class
In the exercise of its powers and discretions including, without
limitation, any modification, waiver, authorisation or
determination under these Conditions and any other Finance
Documents, the Bond Trustee when acting as the Credit Provider will
have regard to the interests of the Bondholders as a class and will
not have regard to the consequences of such exercise for individual
Bondholders or Couponholders (whatever their number) whether
resulting from their being resident or domiciled in, or otherwise
connected with, or subject to, any particular jurisdiction or
otherwise and the Bond Trustee shall not be entitled to require
from the Issuer, ProjectCo, HoldCo, XLCAAssured Guaranty, or the
Security Trustee, nor shall any Bondholder, Receiptholder or
Couponholder be entitled to claim from the Issuer, ProjectCo,
HoldCo, XLCAAssured Guaranty, the Bond Trustee or the Security
Trustee, any indemnification or other payment in respect of any
consequence (including without limitation, any tax consequence) for
individual Bondholders or Couponholders of any such exercise.
In connection with the exercise by the Credit Provider of any of
its rights, powers, authorities or discretions under the Finance
Documents, where the Bond Trustee is the Credit Provider, it may at
any time take such advice as it shall deem appropriate from any
person selected by it or seek instructions from the Bondholders,
whether before or after taking any action under the Finance
Documents and shall not be liable for any losses incurred by reason
of any delay in taking or refraining from taking any action under
any Finance Document by reason thereof. Any costs, expenses or
liabilities incurred in taking any such advice or seeking such
instructions or taking any other action in connection with the
Finance Documents shall be deemed to be Liabilities (as defined in
the Bond Trust Deed) incurred by the Bond Trustee for the purposes
of the Bond Trustee's rights under the Finance Documents to be
indemnified.
For so long as the Bond Trustee is the Credit Provider, it shall
not be obliged to take any such advice or seek any such
instructions or take any other action under the Finance Documents
unless and until it has been so directed by an Extraordinary
Resolution of the Bondholders and indemnified and/or secured to its
satisfaction.
Subject to the provisions of the Security Trust and
Intercreditor Deed relating to the Bond Trustee's Reserved Rights
(the "Reserved Rights"), the Bond Trustee shall not exercise any of
its powers, authorities, rights or discretions under any of the
Finance Documents and/or these Conditions unless and until it has
been directed in writing to do so by the Credit Provider and shall
only be obliged to do so upon being so directed and having been
indemnified and/or secured to its satisfaction, and shall not be
liable for any losses incurred by reason thereof.
Where XLCAAssured Guaranty is the Credit Provider, any such
direction by XLCAAssured Guaranty may be contrary to the interests
of the Bondholders and the other secured parties and the Bond
Trustee will bear no responsibility or liability by reason
thereof.
In the event that in contemplating the exercise of any of its
trusts, powers, authorities, right or discretions under these
Conditions or any Finance Document the Bond Trustee, when acting as
the Credit Provider, is of the opinion that there is a conflict
between the interests of the Bondholders on the one hand and the
interests of any other secured party on the other hand, the Bond
Trustee, insofar as it exercises any of such trusts, powers,
authorities, rights or discretions, shall have regard solely to the
interests of the Bondholders and the other secured parties shall
have no claim against the Bond Trustee for so acting.
The Bond Trustee shall not act at the direction of the Credit
Provider in relation to any matter which affects the Bond Trustee's
Entrenched Rights unless it has also been directed to do so by the
Bondholders by Extraordinary Resolution or requested in writing to
do so by the Bondholders holding at least 25 per cent. of the
Outstanding Balance of the Bonds and vice versa and in any case the
Bond Trustee has been indemnified and/or secured to its
satisfaction.
The Bond Trustee's Reserved Matters may be exercised by the Bond
Trustee without the consent or direction or control of the
Bondholders and the Bond Trustee shall not be obliged to exercise
them in any circumstances.";
(U) Condition 14(c) (Security Trustee entitled to be
indemnified) of the Bonds being deleted and replaced with the
following provision (the modifications are shown in blackline
below):
"(c) Security Trustee entitled to be indemnified
Under the Security Trust and Intercreditor Deed, the Security
Trustee is entitled to be indemnified and relieved from
responsibility in certain circumstances and to be paid its
remuneration, costs and expenses in priority to the claims of the
Bondholders. In addition, the Security Trustee is entitled to enter
into business transactions with the Issuer, ProjectCo, HoldCo,
XLCAAssured Guaranty, the Bondholders, the Receiptholders, the
Couponholders and any entity related to the Issuer, ProjectCo,
HoldCo, XLCAAssured Guaranty, any Bondholder, Receiptholder or
Couponholder or any other such person without accounting for any
profit.";
(V) Condition 14(d) (No obligation to investigate) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(d) No obligation to investigate
Neither the Bond Trustee nor the Security Trustee has
investigated, nor are either of them responsible or liable for any
loss arising as a result of any failure to investigate, the
validity, value, sufficiency or enforceability of the security
created by the Security Documents or the validity or enforceability
of any contracts over which such security is created and both the
Bond Trustee and the Security Trustee shall accept without
investigation, requisition or objection and without any
responsibility or liability for doing so such right and title as
the Issuer ProjectCo and HoldCo have to the property assets and
rights over which security is created pursuant to the Security
Documents.
Neither the Bond Trustee nor the Security Trustee has
responsibility for the validity, enforceability or sufficiency of
the XLCAAG Bond GuaranteeGuarantees against XLCAAssured Guaranty or
any permitted assignee of XLCAAssured Guaranty under the XLCAAG
Bond GuaranteeGuarantees. Nor will they be liable to Bondholders
for any loss they may suffer as a result of any vitiation of the
XLCAAG Bond GuaranteeGuarantees resulting from any act or omission
on the part of the Bond Trustee or the Security Trustee unless the
consequences of such act or omission were actually known to the
Bond Trustee prior to such act or omission occurring and the Bond
Trustee so acted or omitted to act negligently or in wilful
default.
Neither the Bond Trustee nor the Security Trustee will be
responsible for or liable for loss which results should any
deficiency arise between the amount realised in respect of the
property assets and rights over which security is given by the
Security Documents and sums due in respect of the Bonds, the
Receipts or the Coupons and, under the Bond Trust Deed including,
without limitation, because either the Security Trustee or the Bond
Trustee is liable to tax in respect of the property assets and
rights over which such security is created.
Neither the Security Trustee nor the Bond Trustee shall be
responsible for monitoring the obligations of any person owing to
the Issuer, ProjectCo, HoldCo, or any other Senior Creditor or
Junior Creditor and each of them shall, until they have actual
knowledge to the contrary, assume that all persons are duly
performing the same.
Neither the Security Trustee nor the Bond Trustee will be
obliged to take any action under the Finance Documents unless
either or each is indemnified and/or secured to its satisfaction in
respect of any personal liability or expense which it may in its
opinion thereby incur. Enforcement action and/or protection and
realisation of the security may be prevented or delayed as a result
thereof and neither the Security Trustee nor the Bond Trustee shall
be liable therefor.";
(W) Condition 14(f) (Variation or termination of appointment of
Paying Agents) of the Bonds being deleted and replaced with the
following provision (the modifications are shown in blackline
below):
"(f) Variation or termination of appointment of Paying Agents
The initial Paying Agents and their initial specified offices
are listed below. The Issuer reserves the right (with the prior
approval of the Bond Trustee), at any time to vary or terminate the
appointment of any Paying Agent and to appoint a successor
principal paying agent and additional or successor paying agents;
provided, however, that the Issuer shall at all times maintain (i)
a Principal Paying Agent, (ii) so long as the Bonds are admitted to
listing on the official list of the UK Listing Authority and to
trading on the London Stock Exchange's market for listed
securities, at least one Paying Agent with a specified office in
London, (iii) if required by the Bond Trustee, at least one Paying
Agent with a specified office outside the European Union and (iv)
if the conclusions of the ECOFIN Council meeting of 21 January 2003
are implemented, a paying agent in a member state of the European
Union that will not be obliged to withhold or deduct tax pursuant
to any European Union Directive on the taxation of savings
implementing such conclusions or any law implementing or complying
with or introduced to conform to Such Directive. Notice of any
change in any of the Paying Agents or in their specified offices
shall promptly be given by the Issuer to the Bondholders in
accordance with Condition 17.
The Issuer has covenanted in the Bond Trust Deed (i) to make
available its annual report at the specified offices of the Paying
Agents and (ii) to provide annually a written report to XLCAAssured
Guaranty (if it is then the Bond Creditor) and the Bond Trustee
(such report to be made available to Bondholders at the specified
offices of the Paying Agents and the principal office of the Bond
Trustee upon production by any such Bondholders of evidence
satisfactory to the Bond Trustee or the relevant Paying Agent, as
the case may be, as to its holding of the Bonds and its identity)
containing certain information relating to its business.";
(X) Condition 15(a) (Meetings of Bondholders) of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(a) Meetings of Bondholders
The Bond Trust Deed contains provisions for convening meetings
of Bondholders to consider matters affecting their interests,
including the modification of these Conditions, the Bond Trust
Deed, the XLCAAG Bond GuaranteeGuarantees, the Security Documents,
the Collateral Deed and the Master Definitions Schedule. Any such
modification may, subject to the prior written consent of
XLCAAssured Guaranty if it is the Credit Provider, be made if
sanctioned by an Extraordinary Resolution of the Bondholders. A
meeting of Bondholders will also have the power (exercisable by
Extraordinary Resolution) to advise or instruct the Bond Trustee in
connection with the exercise by the Bond Trustee, subject to
Condition 16(a), of any of its rights, powers and discretions under
the Finance Documents, to remove or approve the appointment of a
new Bond Trustee and to appoint any persons (whether Bondholders or
not) as a committee to represent the interests of the Bondholders
and to confer upon such committee any powers which the Bondholders
could themselves exercise by Extraordinary Resolution.
The quorum at any meeting convened to vote on an Extraordinary
Resolution will be two or more persons holding or representing 75
per cent. in outstanding principal amount of the Bonds or, at any
adjourned meeting, two or more persons being or representing
Bondholders whatever the principal amount of the Bonds held or
represented; provided, however, that certain proposals including
any proposal to:
(i) change any date fixed for payment of principal or interest
in respect of the Bonds, to reduce the amount of principal or
interest payable on any date in respect of the Bonds, to alter the
method of calculating the amount of any payment in respect of the
Bonds, Receipts or Coupons or the date for any such payment;
(ii) effect any exchange of the Bonds for, or the conversion of
the Bonds into shares, bonds or other obligations of the Issuer,
XLCAAssured Guaranty or any other person or to approve the
substitution of any person for the Issuer as principal obligor
under the Bonds or the substitution of any person for XLCAAGE as
guarantor under the XLCAAGE Bond Guarantee or AGM as guarantor
under the AGM Bond Guarantee;
(iii) to change the currency of payments under the Bonds,
Receipts or Coupons other than any change made pursuant to
Condition 18;
(iv) to modify any provisions of the XLCAAG Bond
GuaranteeGuarantees in a way which, in the opinion of the Bond
Trustee, is materially prejudicial to the Bondholders;
(v) to change the quorum required at any meeting of the
Bondholders or the majority required to pass an Extraordinary
Resolution;
(vi) to release all or part of the security (unless equivalent
replacement security is taken at the same time) unless such release
is required in accordance with the Security Documents or alter the
rights of priority and enforcement of XLCAAssured Guaranty, the
Bond Trustee or the Security Trustee or the Bondholders or the
Credit Provider under the Security Trust and Intercreditor Deed or
the Collateral Deed or the Accounts Mandate Agreement other than as
expressly contemplated in the documents constituting such security
in the form in which they are in effect as at the Issue Date;
or
(vii) to amend the definition of "Credit Provider" as defined in
the Master Definitions Schedule; or
(viii) to amend any of the above rights,
(together, the "Entrenched Rights") may only be sanctioned by an
Extraordinary Resolution passed at a meeting of Bondholders at
which two or more persons holding or representing not less than
three-quarters or, at any adjourned meeting, at least 25 per cent.
in outstanding principal amount of the Bonds form a quorum. Any
Extraordinary Resolution duly passed at any such meeting shall be
binding on all the Bondholders and Couponholders whether present or
not.
The majority required for an Extraordinary Resolution is at
least 75 per cent. of the votes cast. In addition, a resolution in
writing signed by or on behalf of all Bondholders who for the time
being are entitled to receive notice of a meeting of Bondholders
under the Bond Trust Deed will take effect as it were an
Extraordinary Resolution. Such a resolution in writing may be
contained in one document or several documents in the same form,
each signed by or on behalf of one or more Bondholders.";
(Y) Condition 15(b) (Modification and Waiver) of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(b) Modification and Waiver
Subject to the provisions of Condition 14(b) above, the Bond
Trustee may, without the consent of the Bondholders, Receiptholders
or Couponholders concur with the Issuer, ProjectCo, XLCAAssured
Guaranty (so long as it is the Bond Creditor) or any other relevant
parties in making:
(i) any modification to these Conditions or any other Finance
Document or Project Document which in the opinion of the Bond
Trustee is of a formal, minor or technical nature or is made to
correct a manifest error; and
(ii) except in the case of the Entrenched Rights, any other
modification and any waiver or authorisation of any Event of
Default, Potential Event of Default, Trigger Event, XLCAAG Event of
Default, breach or proposed breach of these Conditions or any other
Finance Document or any Project Document which is in the opinion of
the Bond Trustee not materially prejudicial to the interests of the
Bondholders (as to which the Bond Trustee may rely upon written
confirmation from the Rating Agencies that such modification,
waiver or authorisation would result in the rating of the Bonds
being reduced or withdrawn as conclusive evidence of material
prejudice to the interests of the Bondholders).
Any such modification shall be binding on all Bondholders,
Receiptholders and Couponholders and, unless the Bond Trustee
otherwise agrees, notice thereof shall be given by the Issuer to
the Bondholders as soon as practicable thereafter in accordance
with Condition 17.
Subject to always to the provisions of Condition 14(b) above,
the Bond Trustee may also determine, without the consent of the
Bondholders, the Receiptholders or the Couponholders, that any
Event of Default, Potential Event of Default, Trigger Event or
XLCAAG Event of Default shall not, or shall not subject to specific
conditions, be treated as such provided that the Bond Trustee is of
the opinion that the interests of the Bondholders will not be
materially prejudiced thereby (as to which the Bond Trustee may
rely upon written confirmation from the Rating Agencies that such
determination would result in the rating of the Bonds being reduced
or withdrawn as conclusive evidence of material prejudice to the
interests of Bondholders).
Any such determination shall be binding on all Bondholders,
Receiptholders and Couponholders and, if the Bond Trustee so
requires, notice thereof shall be given by the Issuer to the
Bondholders and XLCAAssured Guaranty (so long as it is the Credit
Provider), as soon as is practicable under Condition 17.";
(Z) Condition 16(a) (Exercise and Enforcement) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"As more particularly provided in the Collateral Deed and the
Security Trust and Intercreditor Deed, each of the Bond Trustee and
the Security Trustee will be obliged to take action to exercise or
enforce its rights under the Finance Documents or in respect of the
Bonds if required to do so by XLCAAssured Guaranty (so long as
XLCAAssured Guaranty is the Credit Provider), except in relation to
certain specified rights of the Bond Trustee (provided that the
Bond Trustee and/or the Security Trustee has been indemnified
and/or furnished with security to its satisfaction), but will not
in most circumstances be entitled to take any such action without
the prior written consent of XLCAAssured Guaranty if it is the Bond
Creditor).
Subject as aforesaid, the Bond Trustee shall not be bound as
against the Bondholders to take any such action or any action to
enforce the XLCAAG Bond GuaranteeGuarantees unless:
(i) it has been so requested in writing by the holders of at
least 25 per cent. in outstanding principal amount of the
outstanding Bonds or has been so directed by an Extraordinary
Resolution; and
(ii) it has been indemnified or provided with security to its satisfaction.
Whether or not XLCAAssured Guaranty is the Bond Creditor, the
Bond Trustee is entitled to exercise and take action in respect of
certain rights reserved for the Bond Trustee's exercise in its sole
discretion.";
(AA) Condition 16(b) (Action by Bondholders) of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(b) Action by Bondholders
No Bondholder, Receiptholder or Couponholder may take any action
against ProjectCo or any other Obligor or XLCAAssured Guaranty to
enforce its rights in respect of the Bonds or to enforce all or any
of the security constituted by the Security Documents or to enforce
the XLCAAG Bond GuaranteeGuarantees unless the Bond Trustee and/or
the Security Trustee having become bound so to proceed fails to do
so within a reasonable time and such failure is continuing.";
(BB) Condition 17 (Notices) of the Bonds being deleted and
replaced with the following provision (the modifications are shown
in blackline below):
"17. Notices
Notices to the Bondholders shall be valid if published in a
leading English language daily newspaper published in the United
Kingdom (which is expected to be the Financial Times or, if given
by some other method approved by the Bond Trustee (which may
include publication on an electronic data display screen) complying
with any requirements of any stock exchange (or any other relevant
authority) on which the Bonds are for the time being listed or by
which they have been admitted to listing). Any such published
notice shall be deemed to have been given on the date of first
publication. Receiptholders, Couponholders and holders of Talons
shall be deemed for all purposes to have notice of the contents of
any notice given to the Bondholders pursuant to this Condition 17.
A copy of every published notice to Bondholders will be supplied to
Euroclear Bank S.A./N.V. ("Euroclear") and Clearstream Banking,
société anonyme ("Clearstream, Luxembourg") for so long as the
Bonds are cleared and settled through those clearing systems or to
any additional or substitute clearing system from time to time
nominated by the Issuer or the Bond Trustee and approved by the
Bond Trustee and XLCAAssured Guaranty (so long as it is the Credit
Provider) through which the Bonds are cleared and settled.";
(CC) Condition 18(a) (Notice of Redenomination) of the Bonds
being deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(a) Notice of Redenomination
ProjectCo may, without the consent of the Bondholders and
Couponholders, on giving at least 30 days' prior notice to
XLCAAssured Guaranty (so long as it is the Credit Provider), the
Bondholders, the Bond Trustee and the Paying Agents, designate a
date (the "Redenomination Date"), being a Scheduled Payment Date
under the Bonds falling on or after the date on which the United
Kingdom becomes a Participating Member State (as defined
below).";
(DD) Condition 19(a) (Governing Law) of the Bonds being deleted
and replaced with the following provision (the modifications are
shown in blackline below):
"(a) Governing Law
The Conditions, the Bond Trust Deed, the Bonds, Receipts and the
Coupons and all matters arising from or connected with these and
any non-contractual obligation arising therefrom are governed by,
and shall be construed in accordance with, English law. The XLCAAG
Bond GuaranteeGuarantees, the Collateral Deed, the Security Trust
and Intercreditor Deed and the Paying Agency Agreement and any
non-contractual obligation arising therefrom are also governed by,
and will be construed in accordance with, English law.";
(EE) Condition 19(b) (English courts) of the Bonds being deleted
and replaced with the following provision (the modifications are
shown in blackline below):
"(b) English courts
The courts of England have exclusive jurisdiction to settle any
dispute (a "Dispute"), arising from or connected with the Bonds,
the Bond Trust Deed and the XLCAAG Bond GuaranteeGuarantees.";
(FF) Condition 19(c) (Appropriate forum) of the Bonds being
deleted and replaced with the following provision (the
modifications are shown in blackline below):
"(c) Appropriate forum
The Issuer agrees and XLCAAssured Guaranty has agreed in the
Bond Trust Deed that the courts of England are the most appropriate
and convenient courts to settle any Dispute and, accordingly, that
it will not argue to the contrary."; and
(GG) Condition 21 (Further issues) of the Bonds being deleted
and replaced with the following provision (the modifications are
shown in blackline below):
"21. Further issues
The Issuer may from time to time, without the consent of the
Bondholders, Receiptholders or Couponholders but subject to the
consent of XLCAAssured Guaranty and in accordance with the Bond
Trust Deed, create and issue further bonds having the same terms
and conditions as the Bonds in all respects (or in all respects
except for the first payment of interest) so as to form a single
series with the Bonds and be secured by the same security as that
securing the Bonds. The Issuer may from time to time, with the
consent of the Bond Trustee and the Credit Provider, create and
issue other series of bonds having the benefit of the Bond Trust
Deed.";
(vi) the amendment of the Master Definitions Schedule by way of
an amended and restated Master Definitions Schedule, in which:
(A) references to:
"XLCA" will be deleted and (save with respect to the definition
of "XLCA Information") replaced with references to "AGE", "AGM" or
"Assured Guaranty" (as the context may require);
"Guarantee and Reimbursement Agreement" will be deleted;
"Guaranteed Obligations" will be deleted;
"XLCA Bond Guarantee" will be deleted;
"XLCA Documents" will be deleted;
"XLCA EIB Guarantee" will be deleted;
"XLCA EIB Financial Guarantees" will be deleted;
"XLCA EIB Initial Guarantee Fee" will be deleted;
"XLCA EIB Ongoing Guarantee Fee" will be deleted;
"XLCA Event of Default" will be deleted;
"XLCA Fee Letter" will be deleted;
"XLCA Financial Guarantees" will be deleted;
"XLCA Initial Guarantee Fee" will be deleted;
"XLCA Initial Variation Bond Guarantee Fee" will be deleted;
"XLCA Variation Bond Ongoing Guarantee Fee" will be deleted;
"XLCA Ongoing Guarantee Fee" will be deleted;
"XLCA--NY" will be deleted;
"XLCA--NY EIB Guarantee" will be deleted;
"XLCA--NY Initial Guarantee Fee" will be deleted;
"XLCA--NY Ongoing Guarantee Fee" will be deleted; and
(B) the following new definitions will be inserted:
"AG Bond Guarantees" means the AGE Bond Guarantee and the AGM
Bond Guarantee;
"AG Documents" means the AG Bond Guarantees, the AG EIB
Guarantees, the AG EIB Financial Guarantees, the AG Guarantee and
Reimbursement Agreement and the AG Fee Letter;
"AG EIB Guarantees" means the AGE EIB Guarantee and the AGM EIB
Guarantee;
"AGE EIB Initial Guarantee Fee" has the meaning given to it in
the AG Fee Letter;
"AGM EIB Initial Guarantee Fee" has the meaning given to it in
the AG Fee Letter;
"AG Event of Default" shall have the meaning ascribed to it in
the Security Trust and Intercreditor Deed;
"AG Fee Letter" means the letter dated on or about the Issue
Date between XLCA, XLCA-NY and the Issuer, the rights and
obligations under which were transferred to and assumed by AGE and
AGM pursuant to a deed of release, transfer and amendment dated
[--] 2017;
"AG Fee" means the AGE Initial Guarantee Fee, the AGM Initial
Guarantee Fee, the AGE EIB Initial Guarantee Fee, the AGM EIB
Initial Guarantee Fee, the AGE Initial Variation Bond Guarantee
Fee, the AGM Initial Variation Bond Guarantee Fee, the AGE Ongoing
Guarantee Fee, the AGM Ongoing Guarantee Fee, the AGE EIB Ongoing
Guarantee Fee, the AGM EIB Ongoing Guarantee Fee, the AGE Variation
Bond Ongoing Guarantee Fee and the AGM Variation Bond Ongoing
Guarantee Fee payable by the Issuer to Assured Guaranty in
accordance with the terms of the AG Fee Letter;
"AG Financial Guarantees" means the AG Bond Guarantees and the
AG EIB Guarantees;
"AGE" means Assured Guaranty (Europe) Ltd.;
"AGE Bond Guarantee" means the financial guarantee and
endorsement thereto issued by XL Capital Assurance (U.K.) Limited
on 8 June 2005 in respect of the Bonds (other than Bonds held by
the Issuer Group) pursuant to the Guarantee and Reimbursement
Agreement, the obligations under which were amended and as assumed
in part by AGE pursuant to a deed of release, transfer and
amendment dated on or about [--] 2017;
"AGE EIB Guarantee" means the financial guarantee and
endorsement thereto issued by XL Capital Assurance (U.K.) Limited
on 8 June 2005 in respect of the EIB Loan pursuant to the Guarantee
and Reimbursement Agreement, the obligations under which were
amended and as assumed in part by AGE pursuant to a deed of
release, transfer and amendment dated on or about [--] 2017;
"AGE EIB Ongoing Guarantee Fee" has the meaning given to it in
the AG Fee Letter;
"AGE Financial Guarantees" means the AGE Bond Guarantee and the
AGE EIB Guarantee;
"AGE Initial Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGE Initial Variation Bond Guarantee Fee" has the meaning given
to it in the AG Fee Letter;
"AGE Ongoing Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGE Variation Bond Ongoing Guarantee Fee" has the meaning given
to it in the AG Fee Letter;
"AGM" means Assured Guaranty Municipal Corp.;
"AGM Bond Guarantee" means the financial guarantee and
endorsement thereto issued by XL Capital Assurance (U.K.) Limited
on 8 June 2005 in respect of the Bonds (other than Bonds held by
the Issuer Group) pursuant to the Guarantee and Reimbursement
Agreement, the obligations under which were amended and as assumed
by AGM pursuant to a deed of release, transfer and amendment dated
on or about [--] 2017;
"AGM EIB Guarantee" means the financial guarantee and
endorsement thereto issued by XL Capital Assurance (U.K.) Limited
on 8 June 2005 in respect of the EIB Loan pursuant to the Guarantee
and Reimbursement Agreement, the obligations under which were
amended in part and as assumed by AGM pursuant to a deed of
release, transfer and amendment dated on or about [--] 2017;
"AGM Financial Guarantees" means the AGM Bond Guarantee and the
AGM EIB Guarantee;
"AGM EIB Ongoing Guarantee Fee" has the meaning given to it in
the AG Fee Letter;
"AGM Initial Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGM Initial Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGM Initial Variation Bond Guarantee Fee" has the meaning given
to it in the AG Fee Letter;
"AGM Non Payment Event of Default" means any guaranteed amount
which is due for payment by AGM in accordance with the terms of the
AGM Bond Guarantee is not paid by AGM on the date stipulated in the
AGM Bond Guarantee;
"AGM Ongoing Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGM Ongoing Guarantee Fee" has the meaning given to it in the
AG Fee Letter;
"AGM Variation Bond Ongoing Guarantee Fee" has the meaning given
to it in the AG Fee Letter;
"Assured Guaranty" means AGE and AGM;
"Guarantee and Reimbursement Agreement" means the guarantee and
reimbursement agreement entered into on 8 June 2005, the
obligations under which were amended in part and as assumed by AGE
and AGM on or about [--] 2017; and
"Guaranteed Obligations" means the obligations of the Issuer
guaranteed by the AG EIB Guarantees and the AG Bond Guarantees,
which amended and restated Master Definitions Schedule
reflecting the above amendments shall be in or substantially in the
form made available to the Bond Trustee following the passing of
this Extraordinary Resolution (the Amended and Restated Master
Definitions Schedule);
(vii) the amendment of the Collateral Deed between, inter alios,
the Issuer, Syncora US and the Bond Trustee (the Collateral Deed)
to reflect the amendments set out in sub--paragraph (xiv) of this
Extraordinary Resolution and which shall be by way of an amended
and restated Collateral Deed in or substantially in the form made
available to the Bond Trustee following the passing of this
Extraordinary Resolution (the Amended and Restated Collateral
Deed);
(viii) the amendment of the Accounts Mandate Agreement entered
into on 8 June 2005 between the Issuer, ProjectCo, HoldCo, HSBC
Bank plc, the Security Trustee, European Investment Bank and
Syncora US (the Accounts Mandate Agreement) by way of a second
amended and restated Accounts Mandate Agreement to reflect the
amendments set out in sub--paragraph (xiv) of this Extraordinary
Resolution and which shall be in or substantially in the form made
available to the Bond Trustee following the passing of this
Extraordinary Resolution (the Amended and Restated Accounts Mandate
Agreement);
(ix) the amendment of the Shareholders' Undertaking entered into
on 8 June 2005 between the Shareholders, the Issuer, ProjectCo,
HoldCo, the Security Trustee, European Investment Bank and Syncora
US (the Shareholders' Undertaking) by way of a second amended and
restated Shareholders' Undertaking to reflect the amendments set
out in sub--paragraph (xiv) of this Extraordinary Resolution and
which shall be in or substantially in the form made available to
the Bond Trustee following the passing of this Extraordinary
Resolution (the Amended and Restated Shareholders'
Undertaking);
(x) the amendment of the Security Trust and Intercreditor Deed
by way of an amended and restated Security Trust and Intercreditor
Deed to reflect the amendments set out in sub--paragraph (xiv) of
this Extraordinary Resolution and which shall be in or
substantially in the form made available to the Bond Trustee
following the passing of this Extraordinary Resolution (the Amended
and Restated Security Trust and Intercreditor Deed);
(xi) the amendment of the XLCA Guarantee and Reimbursement
Agreement by way of an amended and restated Guarantee and
Reimbursement Agreement to reflect the amendments set out in
sub--paragraph (xiv) of this Extraordinary Resolution and which
shall be in in the form of the draft produced to this Meeting and
initialled by the chairman of this Meeting for identification
purposes (the Amended and Restated Guarantee and Reimbursement
Agreement);
(xii) the amendment of the XLCA Financial Guarantees by way of
amended and restated Financial Guarantees to reflect the amendments
set out in sub--paragraph (xiv) of this Extraordinary Resolution
and which shall be in the form of the draft produced to this
Meeting and initialled by the chairman of this Meeting for
identification purposes (the Amended and Restated Financial
Guarantees);
(xiii) the amendment of the XLCA Fee Letter by way of an amended
and restated letter to reflect the amendments set out in
sub-paragraph (xiv) of this Extraordinary Resolution and which
shall be in the form of the draft produced to this Meeting and
initialled by the chairman of this Meeting for identification
purposes (the AG Fee Letter); and
(xiv) in each document referred to in sub--paragraphs (vi) to
(xiii) above and in each Senior Finance Document, references
to:
"XLCA" will be replaced with references to "AGE", "AGM" or
"Assured Guaranty" (as the context may require);
"XLCA Bond Guarantee" will be replaced with references to the
"AGE Bond Guarantee", the "AGM Bond Guarantee" and/or the "AG Bond
Guarantees" as the context may require;
"XLCA Documents" will be replaced with references to "AG
Documents";
"XLCA Event of Default" will be replaced with references to an
"AG Event of Default";
"XLCA Fee Letter" will be replaced with references to the "AG
Fee Letter";
"XLCA Non Payment Event of Default" will be replaced with
references to an "AGM Non Payment Event of Default"; and
"XLCA-NY" will be replaced with references to "AGE", "AGM" or
"Assured Guaranty" (as the context may require),
and in each Amendment Document, references to any of the
original documents which will be amended as Amendment Documents
pursuant to this Extraordinary Resolution will be updated
accordingly;
(b) authorises, directs, requests and empowers the Bond Trustee
as soon as reasonably practicable after the passing of this
Extraordinary Resolution:
(i) to concur in and give effect to all the Proposed Amendments
referred to in this Extraordinary Resolution by entering into and
executing (x) the Amendment Documents in the form provided to the
Bond Trustee following the Meeting if the Extraordinary Resolution
is passed and (y) the Deed of Release, Transfer and Amendment and
the Supplemental Bond Trust Deed, in each case in the form of the
draft produced to this Meeting and initialled by the Chairman of
this Meeting for the purposes of identification;
(ii) to concur in, and to execute and do, all such other deeds,
instruments, acts and things as may be necessary or appropriate to
carry out and give effect to this Extraordinary Resolution and the
implementation of the Proposed Amendments;
(iii) to consent to the entry by the Issuer, ProjectCo and
HoldCo into the Amending Documents (as defined in the Deed of
Release, Transfer and Amendment) to which each is a party; and
(iv) to consent to assumption by AGE and AGM of the obligations
of Syncora US under the XLCA Financial Guarantees and provision of,
respectively, the AGE Financial Guarantees and the AGM Financial
Guarantees;
(c) authorises, directs, requests and empowers the Bond Trustee
as soon as reasonably practicable after the passing of this
Extraordinary Resolution to authorise, direct, request and empower
the Security Trustee:
(i) to concur in and give effect to all the Proposed Amendments
referred to in this Extraordinary Resolution by entering into and
executing (x) the Amendment Documents in the form provided to the
Bond Trustee following the Meeting if the Extraordinary Resolution
is passed and (y) the Deed of Release, Transfer and Amendment, in
form of the draft produced to this Meeting and initialled by the
Chairman of this Meeting for the purposes of identification;
(ii) to concur in, and to execute and do, all such other deeds,
instruments, acts and things as may be necessary or appropriate to
carry out and give effect to this Extraordinary Resolution and the
implementation of the Proposed Amendments; and
(iii) to consent to the entry by the Issuer, ProjectCo and
HoldCo into the Amendment Documents to which each is a party;
(d) discharges and exonerates the Bond Trustee and the Security
Trustee from all and any liability for which it may have become or
may become responsible or liable under the Bond Trust Deed or any
other Finance Document or the Bonds or any Project Document in
respect of any act or omission in connection with this
Extraordinary Resolution or the implementation of the Proposed
Amendments or this Extraordinary Resolution;
(e) sanctions and assents to every abrogation, amendment,
modification, compromise or arrangement in respect of the rights of
the Bondholders against the Issuer or Assured Guaranty or any other
person whether such rights shall arise under the Bond Trust Deed or
the Senior Finance Documents or otherwise involved in or resulting
from or to be effected by, this Extraordinary Resolution, the
Proposed Amendments and their implementation; and
(f) acknowledges that terms used herein but not defined shall
bear the meanings ascribed to them in the Collateral Deed and the
Master Definitions Schedule."
The attention of Bondholders is particularly drawn to the quorum
required for the Meeting and for an adjourned Meeting which is set
out in "Voting and Quorum" below.
Copies of the Bond Trust Deed (including the amended and
restated Conditions of the Bonds), the Supplemental Bond Trust
Deed, the Deed of Release, Transfer and Amendment, the AG
Guarantees, the Guarantee and Reimbursement Agreement and the AG
Fee Letter referred to in the Extraordinary Resolution set out
above will be available for inspection at the specified offices of
the Paying Agents set out further below.
In accordance with normal practice, neither the Bond Trustee,
nor the Security Trustee expresses any opinion as to the merits of
the Proposed Amendments (which it was not involved in negotiating).
It has, however, authorised it to be stated that, on the basis of
the information set out in this Notice (which it recommends
Bondholders to read carefully), it has no objection to the
Extraordinary Resolution referred to above being submitted to the
Bondholders for their consideration. Neither the Bond Trustee, nor
the Security Trustee has, however, been involved in formulating the
Extraordinary Resolution or the Proposed Amendments and neither the
Bond Trustee nor the Security Trustee makes any representation that
all relevant information has been disclosed to the Bondholders in
this Notice. Accordingly, each of the Bond Trustee and the Security
Trustee urges Bondholders who are in any doubt as to the impact of
the implementation of the Extraordinary Resolution or the Proposed
Amendments to seek their own independent financial advice.
DOCUMENTS AVAILABLE FOR INSPECTION
A Bondholder may, at any time during normal business hours on
any weekday from the date hereof up to and including no later than
48 hours before the time fixed for the Meeting, inspect copies of
the documents listed below relating to the Bonds at the specified
office of the Principal Paying Agent and at the Meeting itself. The
specified office of the Principal Paying Agent is set out at the
end of this Notice.
The documents available for inspection are:
-- the Extraordinary Resolution;
-- the Supplemental Bond Trust Deed (including the Conditions of
the Bonds showing in "blackline" the amendments to the existing
Conditions of the Bonds);
-- the Deed of Release, Transfer and Amendment;
-- the Amended and Restated AG Bond Guarantees (showing in
"blackline" the amendments to the Financial Guarantees);
-- the Amended and Restated Guarantee and Reimbursement
Agreement (showing in "blackline" the amendments to the XLCA
Guarantee and Reimbursement Agreement); and
-- the AG Fee Letter (showing in "blackline" the amendments to the XLCA Fee Letter).
VOTING AND QUORUM
Who is entitled to vote on the proposed Extraordinary
Resolution?
1. The relevant provisions governing the convening and holding
of the Meeting are set out in Schedule 5 to the Bond Trust Deed, a
copy of which is available for inspection as referred to above.
2. All of the Bonds are represented by a global note held by a
common depositary for Clearstream Banking, société anonyme
(Clearstream, Luxembourg) and/or Euroclear Bank S.A./N.V.
(Euroclear). For the purposes of the Meeting, a "Bondholder" shall
mean each person who is for the time being shown in the records of
Euroclear or Clearstream, Luxembourg as the holder of a particular
principal amount outstanding of the Bonds.
Procedures for Voting
3. A Bondholder wishing to attend the Meeting in person must
produce at the Meeting a valid Voting Certificate issued by a
Paying Agent relating to the Bonds in respect of which he wishes to
vote.
4. A Bondholder not wishing to attend and vote at the Meeting in
person may either deliver his Voting Certificate obtained to the
person whom he wishes to attend on his behalf or give a voting
instruction by giving his electronic voting instructions (in
accordance with the standard procedures of Euroclear and
Clearstream, Luxembourg) to Clearstream, Luxembourg and/or
Euroclear instructing a Paying Agent to appoint a proxy (a Proxy)
to attend and vote at the Meeting in accordance with his
instructions (Electronic Voting Instructions).
5. Following delivery by a Bondholder of Electronic Voting
Instructions, not later than 48 hours before the time appointed for
holding the Meeting, the relevant clearing system will block the
Bonds in such Bondholder's account and hold the same to the order,
or under the control, of a Paying Agent. By so doing such
Bondholder may obtain Voting Certificates or instruct the relevant
Paying Agent to issue a Block Voting Instruction (as defined in the
Trust Deed) in respect of the Meeting. Bonds so blocked will not be
released until the earlier of:
(a) in respect of Voting Certificate(s):
(i) the conclusion of the Meeting (or any adjourned meeting, as the case may be); and
(ii) the surrender of the Voting Certificate(s) to the Paying Agent; and
(b) in respect of Block Voting Instructions:
(i) the conclusion of the Meeting (or any adjourned meeting, as the case may be); and
(ii) the surrender to the relevant Paying Agent not less than 48
hours before the time fixed for the Meeting (or, if the Meeting has
been adjourned, the time fixed for its resumption), of the receipt
for the deposited Bonds so that such Bonds cease to be blocked as
described above) and notification thereof by the relevant Paying
Agent to the Issuer and the Bond Trustee.
Quorum
6. The quorum required at the Meeting is at least two Voters (as
defined in the Bond Trust Deed) (which may be satisfied by a single
Proxy since the Bonds are represented by the Permanent Global Bond)
holding or representing at least 75% of the outstanding principal
amount of the Bonds.
Adjourned Meeting
7. If within 15 minutes after the time fixed for the Meeting, a
quorum is not present at the Meeting, the Meeting will be adjourned
for a period of not fewer than 14 days and not more than 42 days
and the Extraordinary Resolution will be considered at an adjourned
Meeting (notice of which will be given to the Bondholders). The
quorum at such an adjourned Meeting will be two Voters representing
at least 25% of the Outstanding Principal Amount of the Bonds.
8. Voting Certificates and Block Voting Instructions in respect
of the Meeting (unless surrendered or, as the case may be, revoked
fewer than 48 hours prior to any adjourned meeting) shall remain
valid for such adjourned meeting.
Procedures at the Meeting
9. Every question submitted to the Meeting will be decided in
the first instance by a show of hands. Unless a poll is validly
demanded before or at the time that the result is declared, the
Chairman's declaration that on a show of hands a resolution has
been passed, passed by a particular majority, rejected or rejected
by a particular majority shall be conclusive, without proof of the
number of votes cast for, or against, the resolution.
10. A demand for a poll shall be valid if it is made by the
Chairman, the Issuer, Assured Guaranty, the Bond Trustee or one or
more Voters representing or holding not less than one fiftieth of
the aggregate outstanding principal amount of the Bonds.
11. On a show of hands every person who is either the bearer of
a Voting Certificate or being a Proxy shall have:
(a) on a show of hands, one vote;
(b) on a poll, one vote in respect of each GBP10,000 in
aggregate outstanding principal amount of the Bond(s) represented
or held by him.
To be passed, the Extraordinary Resolution requires a majority
in favour consisting of not less than three--quarters of the votes
cast. If passed, the Extraordinary Resolution will be binding upon
all the Bondholders, whether or not present at such Meeting and
whether or not voting.
12. This notice is governed by, and shall be construed in accordance with, English law.
13. Bondholders will be notified via Euroclear or Clearstream,
Luxembourg of the results of voting on the Extraordinary Resolution
within 14 days of such results being known.
Principal Paying Agent
The Bank of New York Mellon, London Branch
One Canada Square
London E14 5AL
Bond Trustee
Prudential Trustee Company Limited
Laurence Pountney Hill
London EC4R 0HH
For further information regarding the proposed amendments,
please contact:
Transform Schools (North Lanarkshire) Funding PLC
Attention: General Manager
Telephone: +44 (0)1355 585981
Email: mcneil@hcp.co.uk
Assured Guaranty
Attention: Dominic Nathan
Telephone: +44 (0)20 7562 1915
Email: dnathan@assuredguaranty.com
For further information regarding voting, please contact:
The Bank of New York Mellon, London Branch
Attention: Debt Restructuring Services
Telephone: +44 (0)1202 689644
Fax: +44 (0)207 9642728
Email: debtrestructuring@bnymellon.com
Tel: +44 (0)1202 689644
For and on behalf of
TRANSFORM SCHOOLS (NORTH LANARKSHIRE) FUNDING PLC
Date: 24 March, 2017
This information is provided by RNS
The company news service from the London Stock Exchange
END
DOCZMGZFMDNGNZM
(END) Dow Jones Newswires
March 24, 2017 07:32 ET (11:32 GMT)
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