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Bank of Scotland Plc (63GF)

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Wednesday 29 July, 2015

Bank of Scotland Plc

Notice of an Adjourned Meeting

RNS Number : 4578U
Bank of Scotland Plc
29 July 2015
 



NOTICE OF AN ADJOURNED MEETING

THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF COVERED BONDHOLDERS.

If Covered Bondholders are in any doubt about any aspect of the proposals in this notice and/or the action they should take, they are recommended to seek their own financial advice immediately from their stockbroker, bank manager, solicitor, accountant or other financial adviser authorised under the Financial Services and Markets Act 2000 (if they are in the United Kingdom) or from another appropriately authorised independent financial adviser and such other professional advisor from their own professional advisors as they deem necessary.

FURTHER INFORMATION REGARDING THE MATTERS REFERRED TO IN THIS ANNOUNCEMENT IS AVAILABLE IN THE CONSENT SOLICITATION MEMORANDUM (THE "CONSENT SOLICITATION MEMORANDUM") ISSUED BY THE ISSUER DATED 7 JULY 2015, AND COVERED BONDHOLDERS ARE ENCOURAGED TO READ THIS ANNOUNCEMENT IN CONJUNCTION WITH THE SAME.

BANK OF SCOTLAND PLC

(the Issuer)

(Incorporated with limited liability in Scotland with registered number SC 327000)

NOTICE OF COVERED BONDHOLDER MEETING

to each of the holders of the

EUR 1,250,000,000 Series 22 Covered Bonds due 2017 (ISIN: XS0304458721)

EUR 1,250,000,000 Series 4 Covered Bonds due 2019 (ISIN: XS0193640629)

(each a Series and together the Covered Bonds, and the holders thereof, the Covered Bondholders) of the Issuer presently outstanding.

NOTICE IS HEREBY GIVEN that separate adjourned meetings (each a Meeting and together the Meetings) of the Covered Bondholders of each Series will be convened by the Issuer held at the offices of Allen & Overy LLP, One Bishops Square, London E1 6AD on 12 August 2015.  The meetings will be held at 10 a.m. (London time)/11a.m. (CET) for the purpose of considering and, if thought fit, passing the applicable resolution set out below which will be proposed as an Extraordinary Resolution in accordance with the provisions of the Trust Deed dated 18 July 2003 as amended, restated, modified and/or supplemented from time to time (the Trust Deed) made between the Issuer, the Group Guarantor, the LLP and Citicorp Trustee Company Limited (the Bond Trustee and Security Trustee) as bond trustee and security trustee for the Covered Bondholders and constituting the Covered Bonds.  The initial Meeting (in respect of the EUR 1,250,000,000 4.625 per cent.  Series 22 Covered Bonds due 2017) will commence at 10 a.m. (London time) (11 a.m. (CET)), with subsequent Meetings in respect of each other Series (in chronological order of scheduled maturity date) being held at 15 minute intervals thereafter or after the completion of the preceding Meeting (whichever is later).

Capitalised terms used in this notice and not otherwise defined herein shall have the meanings given to them in the Consent Solicitation Memorandum dated 7 July 2015 (the Consent Solicitation Memorandum), which is available upon request from the Tabulation Agent and in the Data Room (see "Documents Available for Inspection" below).  In accordance with normal practice, each of the Bond Trustee, the Security Trustee, the Tabulation Agent, the Solicitation Agents, the Principal Paying Agent, the Paying Agent, the Bond Registrar, the LLP and the Group Guarantor have not been involved in the formulation of, express no opinion on, and make no representations as to the merits of, the Covered Bondholder Proposal set out in the Consent Solicitation Memorandum, the relevant Extraordinary Resolution, the proposed amendments referred to in the relevant Extraordinary Resolution set out below.  None of the Bond Trustee, the Security Trustee, the Tabulation Agent, the Solicitation Agents, the Principal Paying Agent, the Paying Agent, the Bond Registrar, the LLP or the Group Guarantor makes any representation that all relevant information has been disclosed to Covered Bondholders in or pursuant to this Notice, the Consent Solicitation Memorandum or otherwise.  None of the Bond Trustee, the Security Trustee, the Tabulation Agent, the Solicitation Agents, the Principal Paying Agent, the Paying Agent, the Bond Registrar, the LLP or the Group Guarantor have approved the draft amended Documents referred to in the Extraordinary Resolution set out below and the Bond Trustee recommends that Covered Bondholders arrange to inspect and review such draft amended Documents as provided below in this Notice.  Accordingly, Covered Bondholders of the relevant Series should take own independent legal, financial, tax or other advice on the merits and the consequences of voting in favour of the relevant Extraordinary Resolution, including any tax consequences, and on the impact of the implementation of the relevant Extraordinary Resolution.

None of the Bond Trustee the Security Trustee, nor any of the Tabulation Agent, the Solicitation Agents, the Principal Paying Agent, the Paying Agent, the Bond Registrar, the LLP or the Group Guarantor are responsible for the accuracy, completeness, validity or correctness of the statements made in the Consent Solicitation Memorandum or omissions therefrom.

Neither this Notice nor the Consent Solicitation Memorandum constitute or form part of, and should be construed as, an offer for sale, exchange or subscription of, or a solicitation of any offer to buy, exchange or subscribe for, any securities of the Issuer or any other entity.  The distribution of the Consent Solicitation Memorandum may nonetheless be restricted by law in certain jurisdictions.  Persons into whose possession the Consent Solicitation Memorandum comes are required to inform themselves about, and to observe, any such restrictions.

BACKGROUND

The Bank of Scotland plc's EUR 60 billion covered bond programme (the Programme) was established in the United Kingdom, in 2003.  Bank of Scotland plc was registered as a regulated covered bond issuer in 2008, and all covered bonds issued under this Programme are regulated covered bonds as per the Regulated Covered Bond Regulations (the RCB Regulations).

The Programme previously only permitted Hard Bullet Covered Bonds to be issued.  Hard Bullet Covered Bonds require all amounts representing the Final Maturity Amount to be repaid on the Final Maturity Date.  Failure to make payments results in an HBOS Event of Default and an LLP Event of Default.

Given the inefficiencies of Hard Bullet Covered Bonds, more recently established covered bond programmes have included the option for a "soft bullet" maturity structure (as described below). In line with this and as part of the Issuer's on-going balance sheet management, the Issuer, acting pursuant to an Extraordinary Resolution approved by a single meeting of all Covered Bondholders in December 2012, has updated its Programme to include the soft bullet maturity structure and the Conditions and the Transaction Documents were accordingly amended and restated to incorporate the relevant amendments to include this feature to apply in respect of any Covered Bonds that specified the soft bullet maturity structure in their Final Terms.

In the case of soft bullet Covered Bonds, if the Issuer fails to pay the Final Redemption Amount of the relevant Series of Covered Bonds on the Final Maturity Date (subject to the applicable grace period), payments of principal representing the Final Redemption Amounts to be made on the Final Maturity Date may be deferred one year later until an extended final maturity date (the Extended Due for Payment Date).  On the Final Maturity Date a notice to pay (a Notice to Pay) is served on the LLP by the Bond Trustee and if the Guaranteed Amounts equal to the Final Redemption Amount of the relevant Series of Covered Bonds are not paid in full by the Final Maturity Date (for example because, following service of a Notice to Pay, the LLP has insufficient moneys available in accordance with the priority of payments to pay in full such amounts), then an HBOS Event of Default will occur and payment of the unpaid portion of the Final Redemption Amount pursuant to the Covered Bond Guarantee shall be automatically deferred (without an LLP Event of Default occurring as a result of such non-payment) or acceleration of the Covered Bonds.

The unpaid portion of the Final Redemption Amount shall be due and repayable one year later on the Extended Due for Payment Date (subject to the applicable grace period) and the LLP shall, to the extent it has the funds available to it during such extension period (subject to amounts being applied in the Guarantee Priority of Payments) pay such unpaid portion of the Final Redemption Amount in whole or in part only on any Original Due for Payment Date up until the Extended Due for Payment Date. Interest will continue to accrue and be payable on the unpaid portion of the Final Redemption Amount in accordance with the Conditions at a floating rate as specified in the applicable Final Terms. The LLP will pay the Guaranteed Amounts constituting Scheduled Interest on each Original Due for Payment Date and on the Extended Due for Payment Date. A failure to pay the Guaranteed Amounts equal to the Final Redemption Amount on the Extended Due for Payment Date (subject to the applicable grace period) will constitute an LLP Event of Default.

The Proposed Amendments incorporate the inclusion in the applicable Final Terms of the Extended Due for Payment Date and related provisions to allow for soft bullet maturity structure which shall then be applicable in relation to a Series of Covered Bonds. Copies of each draft Amended and Restated Final Terms, the Swap Amendment Agreement and the draft Supplemental Trust Deed (together the Documents), as referred to in the Extraordinary Resolutions above, have been reviewed by each of Fitch Ratings Limited (Fitch), Standard and Poor's Financial Services (S&P) and Moody's Investors Service Limited (Moody's). Fitch, S&P and Moody's have, based on the information provided to them, raised no comments in respect of the draft Documents, and each of Fitch, S&P and Moody's has published a press release confirming that entry into the Documents will not, in and of themselves and at this time, result in the downgrade or withdrawal of the credit ratings assigned by it to the Covered Bonds.

COVERED BONDHOLDER PROPOSAL

Pursuant to the above, the Issuer has convened separate Meetings by the above notice to request that Covered Bondholders of each Series consider and agree by Extraordinary Resolution to the matters contained in the relevant Extraordinary Resolutions set out below.

Each Extraordinary Resolution, if passed, constitutes (amongst others) a direction by the Covered Bondholders of each Series to the Bond Trustee and the Security Trustee to consent to and to concur with the following amendments to the Final Terms and the Trust Deed to implement relevant changes in respect of the relevant Series to create "soft bullet" bonds (instead of Hard Bullet Covered Bonds) with (i) an Extended Due for Payment Date of the specified Interest Payment Date falling on or nearest to the date which is twelve (12) calendar months after the Final Maturity Date for such Series and (ii) interest payable in respect of the relevant Covered Bonds from (and including) the Extension Date in respect of the relevant Series (if applicable) to (but excluding) the Extended Due for Payment Date (or, if earlier, the date on which the Final Redemption Amount, as defined in the Conditions, is paid in full) monthly in arrears and determined by reference to the sum of one-month EURIBOR or one month CIBOR, as applicable and a Margin, all as more fully set out in the Amended and Restated Final Terms, together with such consequential amendments and documents (including amendments to the related Covered Bond Swap) as may be necessary to give effect thereto, the Covered Bondholder Proposal.

The Covered Bondholder Proposal is being put to Covered Bondholders for the reasons set out in the Consent Solicitation Memorandum.

Covered Bondholders are referred to the Consent Solicitation Memorandum which provides further background to the Covered Bond Proposals and the reasons therefor.

 

CONSENT SOLICITATIONS

Covered Bondholders are further given notice that the Issuer has invited  holders of the Covered Bonds of each Series (each such invitation a Consent Solicitation) to consent to the approval, by Extraordinary Resolution at the relevant Meeting, of the modification of the Conditions relating to the relevant Series as described in paragraph 1 of the relevant Extraordinary Resolution as set out below, all as further described in the Consent Solicitation Memorandum (as defined in paragraph 8 of the Extraordinary Resolutions set out below).

The Consent Solicitation Memorandum and any other documents or materials relating to the Consent Solicitations are only for distribution or to be made available to persons located and resident outside the United States and who are not U.S. persons (as defined in Regulation S under the Securities Act) (all such persons Eligible Covered Bondholders).

Subject to the restrictions described in the previous paragraph, Covered Bondholders may obtain from the date of this Notice a copy of the Consent Solicitation Memorandum from the Tabulation Agent, the contact details for which are set out below. In order to receive a copy of the Consent Solicitation Memorandum, a Covered Bondholder will be required to provide confirmation as to his or her status as an Eligible Covered Bondholder.

Pursuant to each Consent Solicitation, each Eligible Covered Bondholder from whom a valid Consent Instruction (as defined in the Consent Solicitation Memorandum) in favour of the relevant Extraordinary Resolution is received by the Tabulation Agent by the Early Instruction Deadline specified in the Consent Solicitation Memorandum will, subject to the conditions set out in the Consent Solicitation Memorandum, be eligible to receive payment of an amount equal to 0.05 per cent. of the principal amount of the Covered Bonds that are the subject of such Consent Instruction (the Early Participation Fee), all as more fully described in the Consent Solicitation Memorandum.

EXTRAORDINARY RESOLUTION
IN RESPECT OF THE EUR 1,250,000,000 4.625 PER CENT.
SERIES 22 COVERED BONDS DUE 2017

"THAT this Meeting of the holders (together, the Series 22 Covered Bondholders) of the presently outstanding EUR 1,250,000,000 4.625 per cent. Covered Bonds due 2017 (the Series 22 Covered Bonds) of Bank of Scotland plc (the Issuer), constituted by the trust deed dated 18 July 2003 as amended, restated, modified and/or supplemented from time to time (the Trust Deed) made between the Issuer, the Group Guarantor, the LLP and Citicorp Trustee Company Limited (the Bond Trustee and the Security Trustee) as bond trustee and security trustee for, inter alios, the Series 22 Covered Bondholders:

1.         (subject to paragraph 7 of this Extraordinary Resolution) assents to the modification of the terms and conditions of the Series 22 Covered Bonds (the Conditions), as set out in Schedule 1 to the Trust Deed and as completed by the Final Terms applicable to the Series 22 Covered Bonds dated 6 June 2007, as any of the same may from time to time be modified in accordance with the Trust Deed, to provide that, instead of being "Hard Bullet" Covered Bonds, the Series 22 Covered Bonds will instead become "soft bullet" Covered Bonds with (i) an Extended Due for Payment Date of the specified Interest Payment Date falling on or nearest to 8 June 2018 and (ii) interest payable in respect of the Series 22 Covered Bonds from (and including) the Extension Date in respect of the Series 22 Covered Bonds (if applicable) to (but excluding) the Extended Due for Payment Date (or, if earlier, the date on which the Final Redemption Amount, as defined in the Conditions, is paid in full) monthly in arrears and determined by reference to the sum of one-month EURIBOR and a Margin, all as more fully set out in the Amended and Restated Final Terms (as defined in paragraph 2 below);

2.         (subject to paragraph 7 of this Extraordinary Resolution) authorises, directs, requests and empowers:

(a)        (i) the Issuer, the Group Guarantor and the LLP to execute an amended and restated final terms in respect of the Series 22 Covered Bonds (the Amended and Restated Final Terms);

(ii)        the Issuer, the Group Guarantor, the LLP, the Bond Trustee and the Security Trustee to execute a deed supplemental to the Trust Deed which annexes the form of the Amended and Restated Final Terms thereto (the Supplemental Trust Deed); and

(iii)       the LLP, the Covered Bond Swap Provider and the Security Trustee to execute the amendment agreement which amends and restates each of the confirmations in respect of each relevant Series (the Swap Amendment Agreement),

in each case to effect the modifications referred to in paragraph 1 of this Extraordinary Resolution, in the form or substantially in the form of the drafts produced to this Meeting and for the purpose of identification signed by the chairman thereof, with such amendments thereto (if any) as the Bond Trustee shall require or agree to; and

(b)        the Issuer, the Bond Trustee and the Security Trustee to execute and to do all such deeds, instruments, acts and things as may be necessary, desirable or expedient in its sole opinion to carry out and to give effect to this Extraordinary Resolution and the implementation of the modifications referred to in paragraph 1 of this Extraordinary Resolution;

3.         discharges and exonerates each of the Bond Trustee and the Security Trustee from all liability for which they may have become or may become responsible under the Trust Deed or the Series 22 Covered Bonds in respect of any act or omission in connection with this Extraordinary Resolution or its implementation, the modifications referred to in paragraph 1 of this Extraordinary Resolution or the implementation of those modifications;

4.         (subject to paragraph 7 of this Extraordinary Resolution) sanctions and assents to every abrogation, modification, compromise or arrangement in respect of the rights of the Series 22 Covered Bondholders appertaining to the Series 22 Covered Bonds against the Issuer, whether or not such rights arise under the Conditions, involved in, resulting from or to be effected by the amendments referred to in paragraph 1 of this Extraordinary Resolution and their implementation;

5.         waives any and all requirements, restrictions and conditions precedent set forth in the Transaction Documents on any person, in implementing the Amended and Restated Final Terms, the Supplemental Trust Deed, the Swap Amendment Agreement, this Extraordinary Resolution and the Covered Bond Proposal;

6.         discharges and exonerates each of the Issuer, the LLP and the Group Guarantor from all liability for which it may have become or may become responsible under the Trust Deed, the Series 22 Covered Bonds or any Transaction Document or any document related thereto in respect of any act or omission in connection with the passing of this Extraordinary Resolution or the executing of any deeds, agreements, documents or instructions, the performance of any acts, matters or things to be done to carry out and give effect to the matters contemplated in the Amended and Restated Final Terms, the Supplemental Trust Deed, the Swap Amendment Agreement, the Notice or this Extraordinary Resolution;

7.         declares that the implementation of this Extraordinary Resolution shall be conditional on:

(a)        the passing of this Extraordinary Resolution; and

(b)        the quorum required for, and the requisite majority of votes cast at, this Meeting being satisfied by Eligible Series 22 Covered Bondholders, irrespective of any participation at this Meeting by Ineligible Series 22 Covered Bondholders and that, in the event that the Extraordinary Resolution is passed at this Meeting but such condition is not satisfied, the chairman of this Meeting and the Bond Trustee are hereby authorised, directed, requested and empowered to adjourn this Meeting for such period being not less than 13 clear days nor more than 42 clear days, and to such place as may be appointed by the chairman of this Meeting and approved by the Bond Trustee, for the purpose of reconsidering resolutions 1 to 9 of this Extraordinary Resolution with the exception of resolution 7(b) of this Extraordinary Resolution.  At any such adjournment of this Meeting, one or more persons present holding Definitive Covered Bonds or voting certificates or being proxies or representatives and holding or representing in aggregate not less than one-third of the aggregate Principal Amount Outstanding of the Series 22 Covered Bonds shall form a quorum and shall have the power to pass such Extraordinary Resolution, and this condition set out in this paragraph 7(b) will be satisfied if the quorum required for, and the requisite majority of votes cast at, such adjourned Meeting are satisfied by Eligible Series 22 Covered Bondholders irrespective of any participation at the adjourned Meeting by Ineligible Series 22 Covered Bondholders; and

8.         acknowledges that the following terms, as used in this Extraordinary Resolution, shall have the meanings given below:

Consent Solicitation means the invitation by the Issuer to all Eligible Series 22 Covered Bondholders to consent to the modification of the Conditions relating to the Series 22 Covered Bonds as described in the Consent Solicitation Memorandum and as the same may be amended in accordance with its terms;

Consent Solicitation Memorandum means the consent solicitation memorandum dated 7 July 2015 prepared by the Issuer in relation to the Consent Solicitation;

Eligible Series 22 Covered Bondholder means each Series 22 Covered Bondholder who is (a) located and resident outside the United States and not a U.S. person (as defined in Regulation S under the Securities Act) and (b) otherwise a person to whom the Consent Solicitation can be lawfully made and that may lawfully participate in the Consent Solicitation;

Ineligible Series 22 Covered Bondholder means each Series 22 Covered Bondholder who is not a person to whom the Consent Solicitation is being made, on the basis that such Series 22 Covered Bondholder is either (i) a U.S. person and/or located or resident in the United States and/or (ii) a person to whom the Consent Solicitation cannot otherwise be lawfully made; and

Securities Act means the U.S. Securities Act of 1933, as amended.

9.         agrees that capitalised terms in this document where not defined herein shall have the meanings given to them in the Consent Solicitation Memorandum dated 7 July 2015 (a copy of which is available for inspection as referred to in the Notice)."

EXTRAORDINARY RESOLUTION
IN RESPECT OF THE EUR 1,250,000,000 4.875 PER CENT.
SERIES 4 COVERED BONDS DUE 2019

"THAT this Meeting of the holders (together, the Series 4 Covered Bondholders) of the presently outstanding EUR 1,250,000,000 4.875 per cent. Series 4 Covered Bonds due 2019 (the Series 4 Covered Bonds) of Bank of Scotland plc (the Issuer), constituted by the trust deed dated 18 July 2003 as amended, restated, modified and/or supplemented from time to time (the Trust Deed) made between the Issuer, the Group Guarantor, the LLP and Citicorp Trustee Company Limited (the Bond Trustee and the Security Trustee) as bond trustee and security trustee for, inter alios, the Series 4 Covered Bondholders:

1.         (subject to paragraph 7 of this Extraordinary Resolution) assents to the modification of the terms and conditions of the Series 4 Covered Bonds (the Conditions), as set out in Schedule 1 to the Trust Deed and as completed by the Final Terms applicable to the Series 4 Covered Bonds dated 2 June 2004, as any of the same may from time to time be modified in accordance with the Trust Deed, to provide that, instead of being Hard Bullet Covered Bonds, the Series 4 Covered Bonds will instead become "soft bullet" Covered Bonds with (i) an Extended Due for Payment Date of the specified Interest Payment Date falling on or nearest to 4 June 2020 and (ii) interest payable in respect of the Series 4 Covered Bonds from (and including) the Extension Date in respect of the Series 4 Covered Bonds (if applicable) to (but excluding) the Extended Due for Payment Date (or, if earlier, the date on which the Final Redemption Amount, as defined in the Conditions, is paid in full) monthly in arrears and determined by reference to the sum of one-month EURIBOR and a Margin, all as more fully set out in the Amended and Restated Final Terms (as defined in paragraph 2 below);

2.         (subject to paragraph 7 of this Extraordinary Resolution) authorises, directs, requests and empowers:

(a)        (i) the Issuer, the Group Guarantor and the LLP to execute an amended and restated final terms in respect of the Series 4 Covered Bonds (the Amended and Restated Final Terms);

(ii)        the Issuer, the Group Guarantor, the LLP, the Bond Trustee and the Security Trustee to execute a deed supplemental to the Trust Deed which annexes the form of the Amended and Restated Final Terms thereto (the Supplemental Trust Deed); and

(iii)       the LLP, the Covered Bond Swap Provider and the Security Trustee to execute the amendment agreement which amends and restates each of the confirmations in respect of each relevant Series (the Swap Amendment Agreement),

in each case to effect the modifications referred to in paragraph 1 of this Extraordinary Resolution, in the form or substantially in the form of the drafts produced to this Meeting and for the purpose of identification signed by the chairman thereof, with such amendments thereto (if any) as the Bond Trustee shall require or agree to; and

(b)        the Issuer, the Bond Trustee and the Security Trustee to execute and to do all such deeds, instruments, acts and things as may be necessary, desirable or expedient in its sole opinion to carry out and to give effect to this Extraordinary Resolution and the implementation of the modifications referred to in paragraph 1 of this Extraordinary Resolution;

3.         discharges and exonerates each of the Bond Trustee and the Security Trustee from all liability for which they may have become or may become responsible under the Trust Deed or the Series 4 Covered Bonds in respect of any act or omission in connection with this Extraordinary Resolution or its implementation, the modifications referred to in paragraph 1 of this Extraordinary Resolution or the implementation of those modifications;

4.         (subject to paragraph 7 of this Extraordinary Resolution) sanctions and assents to every abrogation, modification, compromise or arrangement in respect of the rights of the Series 4 Covered Bondholders appertaining to the Series 4 Covered Bonds against the Issuer, whether or not such rights arise under the Conditions, involved in, resulting from or to be effected by the amendments referred to in paragraph 1 of this Extraordinary Resolution and their implementation;

5.         waives any and all requirements, restrictions and conditions precedent set forth in the Transaction Documents on any person, in implementing the Amended and Restated Final Terms, the Supplemental Trust Deed, the Swap Amendment Agreement, this Extraordinary Resolution and the Covered Bond Proposal;

6.         discharges and exonerates each of the Issuer, the LLP and the Group Guarantor from all liability for which it may have become or may become responsible under the Trust Deed, the Series 4 Covered Bonds or any Transaction Document or any document related thereto in respect of any act or omission in connection with the passing of this Extraordinary Resolution or the executing of any deeds, agreements, documents or instructions, the performance of any acts, matters or things to be done to carry out and give effect to the matters contemplated in the Amended and Restated Final Terms, the Supplemental Trust Deed, the Swap Amendment Agreement, the Notice or this Extraordinary Resolution;

7.     declares that the implementation of this Extraordinary Resolution shall be conditional on:

(a)        the passing of this Extraordinary Resolution; and

(b)        the quorum required for, and the requisite majority of votes cast at, this Meeting being satisfied by Eligible Series 4 Covered Bondholders, irrespective of any participation at this Meeting by Ineligible Series 4 Covered Bondholders and that, in the event that the Extraordinary Resolution is passed at this Meeting but such condition is not satisfied, the chairman of this Meeting and the Bond Trustee are hereby authorised, directed, requested and empowered to adjourn this Meeting for such period being not less than 13 clear days nor more than 42 clear days, and to such place as may be appointed by the chairman of this Meeting and approved by the Bond Trustee, for the purpose of reconsidering resolutions 1 to 9 of this Extraordinary Resolution with the exception of resolution 7(b) of this Extraordinary Resolution.  At any such adjournment of this Meeting, one or more persons present holding Definitive Covered Bonds or voting certificates or being proxies or representatives and holding or representing in aggregate not less than one-third of the aggregate Principal Amount Outstanding of the Series 4 Covered Bonds shall form a quorum and shall have the power to pass such Extraordinary Resolution, and this condition set out in this paragraph 7(b) will be satisfied if the quorum required for, and the requisite majority of votes cast at, such adjourned Meeting are satisfied by Eligible Series 4 Covered Bondholders irrespective of any participation at the adjourned Meeting by Ineligible Series 4 Covered Bondholders; and

8.     acknowledges that the following terms, as used in this Extraordinary Resolution, shall have the meanings given below:

Consent Solicitation means the invitation by the Issuer to all Eligible Series 4 Covered Bondholders to consent to the modification of the Conditions relating to the Series 4 Covered Bonds as described in the Consent Solicitation Memorandum and as the same may be amended in accordance with its terms;

Consent Solicitation Memorandum means the consent solicitation memorandum dated 7 July 2015 prepared by the Issuer in relation to the Consent Solicitation;

Eligible Series 4 Covered Bondholder means each Series 4 Covered Bondholder who is (a) located and resident outside the United States and not a U.S. person (as defined in Regulation S under the Securities Act) and (b) otherwise a person to whom the Consent Solicitation can be lawfully made and that may lawfully participate in the Consent Solicitation;

Ineligible Series 4 Covered Bondholder means each Series 4 Covered Bondholder who is not a person to whom the Consent Solicitation is being made, on the basis that such Series 4 Covered Bondholder is either (i) a U.S. person and/or located or resident in the United States and/or (ii) a person to whom the Consent Solicitation cannot otherwise be lawfully made; and

Securities Act means the U.S. Securities Act of 1933, as amended.

9.         agrees that capitalised terms in this document where not defined herein shall have the meanings given to them in the Consent Solicitation Memorandum dated 7 July 2015 (a copy of which is available for inspection as referred to in the Notice)."

INELIGIBLE HOLDER PAYMENT

Ineligible Holder Payment

Any Covered Bondholder who is either (i) a U.S. person and/or located or resident in the United States and/or (ii) a person to whom the relevant Consent Solicitation cannot otherwise be lawfully made (each an Ineligible Covered Bondholder) may be eligible, to the extent permitted by applicable laws and regulations, to receive an equivalent amount to any applicable Early Participation Fee (which is an amount equal to 0.05 per cent. of the principal amount of the Covered Bonds that are the subject of the relevant Ineligible Holder Instruction (as defined below)) (the Ineligible Holder Payment).

To be eligible for the Ineligible Holder Payment, an Ineligible Covered Bondholder must deliver, or arrange to have delivered on its behalf, a valid Ineligible Holder Instruction that is received by the Tabulation Agent by 4 p.m. (London time) (5 p.m. (CET)) on 21 July 2015 (the Ineligible Instruction Deadline) and is not subsequently revoked.

Only Ineligible Covered Bondholders may submit Ineligible Holder Instruction(s) and be eligible to receive the Ineligible Holder Payment. By delivering, or arranging for the delivery on its behalf, of an Ineligible Holder Instruction in accordance with the procedures described below, a Covered Bondholder shall be deemed to agree, acknowledge and represent to the Issuer, the Tabulation Agent and the Solicitation Agents that it is an Ineligible Covered Bondholder. Eligibility for the Ineligible Holder Payment is subject in each case to the relevant Extraordinary Resolution being passed at the relevant Meeting (or any adjourned such Meeting) and subsequently implemented by the Issuer.

Where payable, Ineligible Holder Payments are expected to be paid by the Issuer to the relevant Ineligible Covered Bondholders no later than the third Business Day from the Implementation Date following the applicable Meeting at which the Extraordinary Resolution is passed and the Eligibility Condition is satisfied for the relevant Series (unless any adjourned Meeting is required, in which case such payments are expected to be made on or around the third business day following the Implementation Date following the relevant adjourned Meeting at which the Extraordinary Resolution is passed and the Eligibility Condition is satisfied for the relevant Series).

By submitting an Ineligible Holder Instruction by the Ineligible Instruction Deadline, an Ineligible Covered Bondholder will instruct the Principal Paying Agent to appoint one or more representatives of the Tabulation Agent as their proxy to attend the relevant Meeting (and any adjourned such Meeting) and vote in the manner specified or identified in such Ineligible Holder Instruction in respect of the relevant Extraordinary Resolution.

Submission of Ineligible Holder Instruction(s)

In respect of any Covered Bonds held through Euroclear Bank SA/NV (Euroclear) or Clearstream Banking, société anonyme (Clearstream, Luxembourg), the submission of Ineligible Holder Instruction(s) will be deemed to have occurred upon receipt by the Tabulation Agent from Euroclear or Clearstream, Luxembourg, as applicable, of a valid instruction (an Ineligible Holder Instruction) submitted in accordance with the requirements of Euroclear or Clearstream, Luxembourg, as applicable. Each such Ineligible Holder Instruction must specify, among other things, the aggregate principal amount of the Covered Bonds of the relevant Series to which such Ineligible Holder Instruction relates, the securities account number at Euroclear or Clearstream, Luxembourg, as applicable, in which the relevant Covered Bonds are held and whether the Ineligible Covered Bondholder wishes to instruct the Principal Paying Agent to appoint one or more representatives of the Tabulation Agent to attend the relevant Meeting (and any adjourned such Meeting) and vote in favour of or against the relevant Extraordinary Resolution. The receipt of such Ineligible Holder Instruction by Euroclear or Clearstream, Luxembourg, as applicable, will be acknowledged in accordance with the standard practices of Euroclear or Clearstream, Luxembourg, as applicable, and will result in the blocking of the relevant Covered Bonds in the relevant Ineligible Covered Bondholder's account with Euroclear or Clearstream, Luxembourg, as applicable, so that no transfers may be effected in relation to such Covered Bonds until the earlier of (i) the date on which the relevant Ineligible Holder Instruction is validly revoked (including their automatic revocation on the termination of the related Consent Solicitation) and (ii) the conclusion of the relevant Meeting (or, if applicable, any adjourned such Meeting).

Only Direct Participants (as defined under "Voting and Quorum" below) may submit Ineligible Holder Instruction(s).  Each beneficial owner of Covered Bonds who is an Ineligible Covered Bondholder and is not a Direct Participant, must arrange for the Direct Participant through which such beneficial owner of Covered Bonds who is an Ineligible Covered Bondholder holds its Covered Bonds to submit an Ineligible Holder Instruction on its behalf to Euroclear or Clearstream, Luxembourg, as applicable, before the deadlines specified by the relevant clearing system.

REQUIREMENTS OF U.S. SECURITIES LAWS

If an Extraordinary Resolution is passed and implemented in respect of any Series, the Amended and Restated Final Terms relating to the relevant Series will contain a statement that, until the expiry of the period of 40 days after the date of the Amended and Restated Final Terms, sales of the relevant Covered Bonds may not be made in the United States or to U.S. persons unless made outside the United States pursuant to Rules 903 and 904 of Regulation S.



 

Covered Bondholders who have submitted and not revoked (in the limited circumstances in which revocation is permitted) a valid Consent Instruction or Ineligible Holder Instruction in respect of the relevant Extraordinary Resolution by 4 p.m. (London time) (5 p.m. (CET)) on 24 July 2015 (the Expiration Deadline), by which they will have given instructions for the appointment of one or more representatives of the Tabulation Agent by the Principal Paying Agent as their proxy to vote in favour of or against (as specified in the relevant Consent Instruction or Ineligible Holder Instruction) the relevant Extraordinary Resolution at the relevant Meeting (or any adjourned such Meeting), need take no further action to be represented at the relevant Meeting (or any such adjourned such Meeting).

 

GENERAL INFORMATION

The attention of Covered Bondholders is particularly drawn to the quorum required for the Covered Bondholders Meetings and for any adjourned Meeting which is set out in paragraphs 1, 2, 3, 4 and 5 of "Voting and Quorum" below.  Having regard to such requirements, Covered Bondholders are strongly urged either to attend the Meeting or to take steps to be represented at the Meeting, as referred to below, as soon as possible.

VOTING AND QUORUM

1.         The provisions governing the convening and holding of the Meeting are set out in the fourth schedule to the Trust Deed, a copy of which is available for inspection by the Covered Bondholders during normal business hours at the specified offices of the Principal Paying Agent on any weekday (public holidays excepted) and in the Data Room up to and including the date of the Meeting and at the Meeting.

All of the Covered Bonds are represented by a global Covered Bond and are either: (i) held by a common depositary or common safekeeper for Euroclear Bank S.A./N.V. (Euroclear) and Clearstream Banking, société anonyme (Clearstream, Luxembourg) or (ii) held in custody by Danske Bank A/S as a depositary, and registered in VP Securities A/S (VPS).  For the purpose of the Meetings, a Covered Bondholder shall mean each person who is for the time being shown in the records of VPS or Euroclear or Clearstream, Luxembourg as the holder of a particular Principal Amount Outstanding of the Covered Bonds.

A Covered Bondholder wishing to attend the Meeting in person must produce at the Meeting a valid voting certificate issued by the Principal Paying Agent relating to the Covered Bond(s) in respect of which it wishes to vote. A Covered Bondholder who wishes to attend the relevant Meeting in person will not be Eligible to receive the Early Participation Fee.

Any Covered Bondholder who wishes to vote in respect of the relevant Extraordinary Resolution but does not wish to attend the relevant Meeting in person should: (i) in the case of a beneficial owner whose Covered Bonds are held in book-entry form by a custodian, request such beneficial owner's custodian to vote on the relevant Extraordinary Resolution in accordance with the procedures set out in Section 4 - Procedures in connection with the Consent Solicitations of the Consent Solicitation Memorandum, or (ii) in the case of a Covered Bondholder whose Covered Bonds are held in book-entry form directly in the relevant Clearing System, vote on the relevant Extraordinary Resolution in accordance with the procedures set out in Section 4 - Procedures in connection with the Consent Solicitation of the Consent Solicitation Memorandum.

Covered Bondholders should note that the timings and procedures set out below reflect the requirements for Covered Bondholders' meetings set out in the Trust Deed, but that the Clearing Systems and the relevant intermediaries may have their own additional requirements as to timings and procedures for voting on the relevant Extraordinary Resolution.  Accordingly, Covered Bondholders wishing to vote in respect of the relevant Extraordinary Resolution are strongly urged either to contact their custodian (in the case of a beneficial owner whose Covered Bonds are held in book-entry form by a custodian) or the relevant Clearing System (in the case of a Covered Bondholder whose Covered Bonds are held in book-entry form directly in the relevant Clearing System), as soon as possible.

2.         The quorum at any Meeting for passing an Extraordinary Resolution which constitutes a Series Reserved Matter shall (subject as provided below) be one or more persons present holding or representing Covered Bonds or voting certificates or being proxies or representatives and holding or representing in aggregate not less than two-thirds of the aggregate Principal Amount Outstanding of the relevant Series of Covered Bonds for the time being outstanding.  If a quorum is not present within 15 minutes (or such longer period not exceeding 30 minutes as the chairman may decide) after the time fixed for a Meeting, the Meeting will be adjourned for such period being not less than 13 clear days nor more than 42 clear days, and to such place as may be appointed by the chairman of the meeting and approved by the Bond Trustee.  In addition, in the event that the quorum required for, and the requisite majority of votes cast at, the relevant Meeting is satisfied but the Eligibility Condition in respect of such Meeting is not satisfied, the chairman of the relevant Meeting and the Bond Trustee will adjourn the relevant Meeting for such period being not less than 13 clear days nor more than 42 clear days, and to such place as may be appointed by the chairman of the Meeting and approved by the Bond Trustee.  The Extraordinary Resolution will be considered at an adjourned Meeting (notice of which will be given to the Covered Bondholders of the relevant Series of Covered Bonds).  At any adjourned Meeting, one or more persons present holding Definitive Covered Bonds or voting certificates or being proxies or representatives and holding or representing in aggregate not less than one-third of the aggregate Principal Amount Outstanding of the relevant Series of Covered Bonds shall (subject as provided below) form a quorum and shall have the power to pass the Extraordinary Resolution.

3.         To be passed at the relevant Meeting, the Extraordinary Resolution requires (a) a majority in favour consisting of not less than three-fourths of the persons voting thereat upon a show of hands or if a poll is duly demanded by a majority consisting of not less than three-fourths of the votes cast on such poll; or (b) a resolution in writing signed by or on behalf of Covered Bondholders holding not less than fifty per cent. in Principal Amount Outstanding of the relevant Series of Covered Bonds, which resolution in writing may be contained in one document or in several documents in like form each signed by or on behalf of one or more of the relevant Series of Covered Bondholders.  The question submitted to the Meeting shall be decided in the first instance by a show of hands unless a poll is (before, or on the declaration of, the result of the show of hands) demanded by the chairman of the Meeting, the Issuer, the Guarantors, the Bond Trustee or any person present holding a Definitive Covered Bond or a voting certificate or being a proxy or representative (whatever the Principal Amount Outstanding of the relevant Series of Covered Bonds so held or represented by him) a declaration by the chairman that a resolution has been carried or carried by a particular majority or lost or not carried by a particular majority shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against such resolution. In respect of the outstanding Covered Bonds of the relevant Series which are not denominated in Sterling, the Principal Amount Outstanding of such Covered Bonds shall be the equivalent in Sterling at the relevant Covered Bond Swap Rate. In such circumstances, on any poll each person present shall have one vote for each £1 (or such other Sterling amount as the Bond Trustee may in its absolute discretion stipulate) of the Principal Amount Outstanding of the Covered Bonds of the relevant Series (converted as above) which it holds or represents.

4.         The implementation of each Consent Solicitation and the related Extraordinary Resolution will be conditional on:

(a)        the passing of the relevant Extraordinary Resolution; and

(b)        the quorum required for, and the requisite majority of votes cast at, the relevant Meeting being satisfied by Eligible Covered Bondholders, irrespective of any participation at the relevant Meeting by Ineligible Covered Bondholders (including the satisfaction of such condition at an adjourned Meeting) (the Eligibility Condition),

(together, the Consent Conditions).

5.         If passed, the Extraordinary Resolution passed at the Meeting will be binding upon all the Covered Bondholders of the relevant Series and upon all Receiptholders and Couponholders of the relevant Series whether or not present or voting at the Meeting.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of items (a) to (c) below (together, the Covered Bondholder Information) will be available (1) from the date of this Notice, for inspection by existing Covered Bondholders at the specified office of the Principal Paying Agent and (2) from 7 July 2015, for inspection in an on-line data room accessible to existing Covered Bondholders at https://live.irooms.net/Site/Security/Login.aspx (the Data Room).  Access to the Covered Bondholder Information in the Data Room will be provided to existing Covered Bondholders on request to the Tabulation Agent and the production of evidence satisfactory to the Tabulation Agent of an entity's status as an existing Covered Bondholder and, in the case of a corporation, that the individual is a duly authorised representative of an existing Covered Bondholder.

(a)        this Notice;

(b)        the Transaction Documents;

(c)        the current drafts of each Amended and Restated Final Terms, the Supplemental Trust Deed and the Swap Amendment Agreement, as referred to in each Extraordinary Resolution set out above (the Amendment Documents); and

(d)        such other ancillary documents as may be approved by the Bond Trustee and/or such other relevant party as are necessary or desirable to give effect to the Covered Bondholder Proposal in full.

This Notice should be read in conjunction with the Covered Bondholder Information.

The Covered Bondholder Information may be supplemented from time to time.  Existing Covered Bondholders should note that the Amendment Documents may be subject to amendment where such amendments are in line with the Proposed Amendments up until 7 days prior to the date fixed for the Meeting.  Should such amendments be made, blacklined copies (showing the changes from the originally available Amendment Documents) and clean versions will be available for inspection, at the specified office of the Principal Paying Agent and in the Data Room. The blackline copies of the Amendment Documents will contain certain other additional minor amendments which are not the subject of this Consent Solicitation Memorandum, or the Covered Bond Proposal, being separately agreed with the Bond Trustee.

Existing Covered Bondholders will be informed of amendments to the Amendment Documents by announcements released on the information services of the London Stock Exchange, the Luxembourg Stock Exchange and the OMX Nordic Exchange Copenhagen A/S, and/or (where they have previously accessed the Data Room) by e-mail.

Existing Covered Bondholders may access the Data Room or inspect the Amendment Documents at the specified office of the Principal Paying Agent one or more times prior to and on the date that Covered Bondholder Meetings are held. 

Existing Covered Bondholders who request access to the Data Room will be deemed to have authorised the Tabulation Agent to pass their details on to Bank of Scotland plc, Deutsche Bank AG, London Branch, Lloyds Bank plc and their respective advisers.

 



CONTACT INFORMATION

Further information relating to the Proposed Amendments can be obtained from the Solicitation Agents directly:

 

Deutsche Bank AG, London Branch

Winchester House

1 Great Winchester Street

London EC2N 2DB

United Kingdom

 

Telephone number: +44 207 545 8011

Attention: Liability Management Group

Email: [email protected]

Lloyds Bank plc

10 Gresham Street

London EC2V 7AE

United Kingdom

 

Telephone number: +44 20 7158 2720

Attention: Liability Management Group

Email: [email protected]

The address of the Principal Paying Agent, the Tabulation Agent, the Security Trustee and the Bond Trustee are set out below:

Bond Trustee and Security Trustee

Tabulation Agent

Citicorp Trustee Company Limited

Citigroup Centre

Canada Square, Canary Wharf

London E14 5LB

United Kingdom

 

Fax:                +44 (0)20 7500 5857
Attention:       Agency and Trust

Lucid Issuer Services Limited
Leroy House
436 Essex Road
London N1 3QP

United Kingdom

Telephone number: +44 20 7704 0880
Email: [email protected]

Principal Paying Agent

 

Citibank, N.A., London Branch

21st Floor, Citigroup Centre

Canada Square

Canary Wharf

London E14 5LB

United Kingdom

 

Telephone:        +44 20 7508 3830/3835

Telefax:            +44 20 7508 3875/3876

Attention:          Agency and Trust

 

 

Covered Bondholders whose Covered Bonds are held by Euroclear or Clearstream, Luxembourg should contact the Tabulation Agent at the address details above for further information on how to vote at the Meeting.

ANNOUNCEMENTS

If the Issuer is required to make an announcement relating to matters set out in this Notice, any such announcement will be made in accordance with all applicable rules and regulations via (i) notices to the Clearing Systems for communication to Covered Bondholders, (ii) an announcement released on the information services of the London Stock Exchange, the Luxembourg Stock Exchange and the OMX Nordic Exchange Copenhagen A/S and/or (iii) a notice published on Bloomberg.

This Notice is given by:

BANK OF SCOTLAND PLC

Dated 29 July 2015

 

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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