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Mainsail II Ltd (73WC)


Friday 22 August, 2008

Mainsail II Ltd

Restructuring Agreement/Portf

RNS Number : 8539B
Mainsail II Ltd
21 August 2008


                                                                                                                                21 August 2008

          Company Announcement - Restructuring Agreement and Portfolio Sales Agreement


          US$112,000,000 CAPITAL NOTE PROGRAMME

The joint receivers of the Company, being Kris Beighton of KPMG in the Cayman Islands and Richard Heis and Mick McLoughlin each of KPMG LLP in the UK (the 'Receivers')have today announced that the Company and the Receivers have entered into a restructuring agreement (the 'Restructuring Agreement') and a portfolio sale agreement (the 'Portfolio Sale Agreement), each with Goldman Sachs International ('GSI').

Capitalised terms not otherwise defined in this announcement shall have the meanings given to them in the Master Definitions Agreement dated 6 July 2006, as amended and restated on 13 July 2007 between, amongst others, the Company and The Bank of New York Mellon (as Security Trustee).

Sales of Portfolio Securities

Under the terms of the Restructuring Agreement, the Company has agreed, on specified terms and subject to certain conditions, to sell a portion of debt securities held by the Company (the 'Portfolio Securities') pursuant to an auction process (the 'Auction Process'involving certain market participants (the 'Cash Bidders') who will be invited to submit bids for the purchase of that portion of the Portfolio Securities.


Under the Portfolio Sale Agreement, the Company has agreed to sell the remaining Portfolio Securities (which are not being sold to the Cash Bidders) to GSI, subject to the satisfaction of certain conditions precedent.

Following completion of the sales of the Portfolio Securities to the Cash Bidders and GSI (the
'Portfolio Sales'), the Receivers will distribute the net cash proceeds received from the Portfolio
Sales in accordance with the terms of the Amended Collateral and Security Trust Agreement
dated 13 July 2007 (the 'CSTA'). The Receivers do not anticipate that such net cash proceeds
will be sufficient to allow any payment to be made to the holders of the Mezzanine Notes or the

Capital Notes or to any other party which is subordinate to the Senior Secured Parties in the

applicable Priority of Payments set out in the CSTA.    

The Receivers expect the Portfolio Sales to occur during the course of September 2008 with settlement due to take place shortly thereafter, although such Portfolio Sales may be delayed or cancelled in whole or in part in certain circumstances (including, without limitation, as a result of adverse market conditions or the Company (acting by the Receivers) determining that the price for the Portfolio Securities obtained through the Auction Process is not acceptable).

Potential Investments  for Senior Secured Parties    

Certain potential investments will be made available to eligible holders of the Commercial Paper and the Hedge Providers (together, the 'Eligible Creditors')A Letter will shortly be circulated to Senior Secured Parties by the Receivers, which will provide further details on these potential investment options.

This notice does not constitute an offer to purchase or sell or the solicitation of an offer to 
purchase or sell any securities. The potential investments, if offered, will be offered, as applicable, pursuant to a registration statement filed with the U.S. Securities and Exchange Commission under the Securities Act of 1933, as amended (the 'Securities Act'), or pursuant to applicable exemptions from registration thereunder, only to Senior Secured Parties that have certified certain matters, including as applicable, as to their status as 'qualified institutional buyers' (or other institutional investors approved as eligible in relation to such potential investments) or non 'US Persons' located in certain specified countries as such terms are defined in accordance with Rule 144A and Regulation S under the Securities Act and, in addition, their status as 'qualified purchasers' for purposes of the Investment Company Act of 1940, as amended.

The potential investments referred to above do not affect the existing rights of the Senior Secured Parties. A Senior Secured Party that does not wish to participate in the potential investments need not take any action, and each non-participating Senior Secured Party will simply receive those cash amounts which it is entitled to in accordance with the terms of the CSTA.

The potential investments are not part of the receivership of the Company.  None of the Company, Mainsail II LLC or the Receivers (a) have any role whatsoever in, and are not connected or in any way affiliated to the issuers of any potential investments, (b) are in any way responsible for any potential investments, (c) have approved, endorsed, recommended, structured or otherwise taken responsibility for the potential investments or (d) are providing any Senior Secured Party with any legal, accounting, business, tax or other advice in connection with the potential investments.


Further information

Should you have any queries concerning this announcement you may contact the Receivers as follows:


Cayman Islands:       KPMG                                UK:      KPMG LLP
                               PO Box 493, 2nd Floor                    8 Salisbury Square
                               Century Yard Building                     London
                               Grand Cayman                               EC4Y 8BB
                               Cayman Islands                              England
                               KY1 -1106


Attn:                      Kris Beighton                                   Richard Heis/Mick McLoughlin
Telephone:             + 1 345 914 4392                             + 44 20 7694 3429
Facsimile:             + 1 345 949 7614                              + 44 20 7694 3011
e-mail:                   [email protected]


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