TIDM99XB
RNS Number : 6961T
Income Contingent Student Loans 1
26 March 2021
THIS NOTICE CONTAINS IMPORTANT INFORMATION OF INTEREST TO THE
REGISTERED AND BENEFICIAL OWNERS OF THE NOTES (AS DEFINED BELOW).
IF APPLICABLE, ALL DEPOSITARIES, CUSTODIANS AND OTHER
INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUESTED TO PASS THIS
NOTICE TO SUCH BENEFICIAL OWNERS IN A TIMELY MANNER.
If you are in any doubt as to the action you should take, you
are recommended to seek your own financial advice immediately from
your stockbroker, bank manager, solicitor, accountant or other
financial adviser authorised under the Financial Services and
Markets Act 2000 (if you are in the United Kingdom), or from
another appropriately authorised independent financial adviser and
such other professional advice from your own professional advisors
as you deem necessary.
This Notice is addressed only to holders of the Notes (as
defined below) and persons to whom it may otherwise be lawful to
distribute it ("relevant persons"). It is directed only at relevant
persons and must not be acted on or relied on by persons who are
not relevant persons. Any investment or investment activity to
which this Notice relates is available only to relevant persons and
will be engaged in only with relevant persons.
If you have recently sold or otherwise transferred your entire
holding(s) of Notes referred to below, you should immediately
forward this document to the purchaser or transferee or to the
stockbroker, bank or other agent through whom the sale or transfer
was effected for transmission to the purchaser or transferee.
THIS NOTICE DOES NOT CONSTITUTE OR FORM PART OF, AND SHOULD NOT
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 IN ANY
JURISDICTION.
In accordance with normal practice, none of the Issuer, the
Solicitation Agent, the Note Trustee, the Security Trustee, the
Agents or their affiliates (or their respective directors,
employees, officers, consultants or agents) expresses any view or
opinion whatsoever as to the Proposed Base Rate Modification, the
Proposed Amendments, the Amended Documents (each as defined below)
or the information set out in this Notice; and none of the
Solicitation Agent, the Note Trustee nor the Security Trustee makes
any representation or recommendation whatsoever as to any action to
be taken or not taken by Noteholders in relation to the Proposed
Base Rate Modification, the Proposed Amendments, the Amended
Documents or this Notice, or any document prepared in connection
with any of them. Accordingly, the Issuer, the Solicitation Agent,
the Note Trustee and the Security Trustee urge Noteholders who are
in doubt as to the impact of the implementation of the Proposed
Base Rate Modification, the Proposed Amendments, the Amended
Documents or this Notice or any document prepared in connection
with any of them (including any tax or other consequences), to seek
their own independent financial, tax and legal advice. Each of the
Issuer, the Note Trustee, the Security Trustee and the Solicitation
Agent has not made, nor will they make, any assessment of the
merits of the Proposed Base Rate Modification, the Proposed
Amendments, the Amended Documents or this Notice or of the impact
of the Proposed Base Rate Modification, the Proposed Amendments,
the Amended Documents or this Notice on the interests of the
Noteholders either as a class or as individuals.
Income Contingent Student Loans 1 (2002-2006) PLC
(Registered Number: 10596240)
1 Bartholomew Lane
London, United Kingdom, EC2N 2AX
(the "Issuer")
NOTICE OF BASE RATE MODIFICATION
to the holders of the following notes of the Issuer presently
outstanding
GBP336,606,941.92 Class A1 Asset-Backed Floating Rate Notes due
2056 (ISIN: XS1722900518), GBP602,954,305.00 Class A2 Asset-Backed
Fixed Rate Notes due 2056 (ISIN: XS1722900864), GBP120,610,000
Class B Notes due 2056 (ISIN: XS1722900948) and GBP1,919,125,000
Class X Notes due 2056
(the "Noteholders" and the "Notes", respectively)
THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF
NOTEHOLDERS.
NOTICE IS HEREBY GIVEN by the Issuer to the Noteholders in
accordance with Condition 16 (Notices to Noteholders) that the
Issuer intends to amend the base rate component of the Interest
Rate applicable to the Class A1 Notes on or around 6 May 2021, by
amending the documents specified in this notice in order to effect
the Proposed Amendments (as defined below).
1. We refer to the note trust deed dated 13 December 2017
between the Issuer and Citicorp Trustee Company Limited as note
trustee (as amended, supplemented and restated from time to time,
the "Note Trust Deed"), including the terms and conditions of the
Notes set out at Schedule 6 thereto (the "Conditions"), pursuant to
which the Notes were constituted on the terms and subject to the
conditions contained therein.
2. Subject as otherwise provided in this notice and unless there
is anything in the subject or context inconsistent therewith, all
words and expressions defined in the Note Trust Deed shall have the
same meanings in this notice.
3. Pursuant to Clause 9.2(g) of the Note Trust Deed and
Condition 14.3(g) (Additional modification rights), the Note
Trustee is obliged, without the consent or sanction of the
Noteholders or any other Secured Creditor, to concur with the
Issuer in making any modifications to the Notes, the Deed of
Charge, the Note Trust Deed or any other Transaction Documents as
are necessary or advisable in the reasonable judgement of the
Issuer in order to enable the Issuer to amend the Applicable Base
Rate to an Alternative Base Rate provided that (i) such
modification is undertaken due to the circumstances set out in
Clause 9.2 of the Note Trust Deed and Condition 14.3, (ii) the
Alternative Base Rate is a rate that satisfies the requirements of
Clause 9.2 of the Note Trust Deed and Condition 14.3 and (iii) the
other procedural formalities of Clauses 9.2 of the Note Trust Deed
and Condition 14.3 have been met.
4. The Issuer proposes to amend the Conditions (by supplementing
the Note Trust Deed) and the Master Definitions and Construction
Agreement (the Note Trust Deed and the Master Definitions and
Construction Agreement being the "Amended Documents") as described
below to:
(a) remove references to "LIBOR";
(b) change the Applicable Base Rate to refer to a "SONIA" based rate;
(c) change the interest rate calculation provisions in relation
to the Applicable Base Rate to refer to a "SONIA" based rate;
and
(d) change the margin payable on the Class A1 Notes in order to,
so far as reasonably and commercially practicable, preserve what
would have been the expected Interest Rate applicable to the Class
A1 Notes had no Base Rate Modification been effected,
(such amendments together the "Proposed Base Rate
Modification").
The Amended Documents can be viewed at the following link
https://www.sf.citidirect.com, and the changes set out therein
being the "Proposed Amendments".
5. The Proposed Base Rate Modification is being undertaken due to:
(a) a public statement by the Financial Conduct Authority of the
UK (the "FCA") as supervisor of the administrator of LIBOR (which
is the Applicable Base Rate) that LIBOR will be permanently or
indefinitely discontinued with effect from a date no later than six
months after the proposed effective date of such Base Rate
Modification; and
(b) a public statement by the FCA as supervisor of the
administrator of LIBOR (which is the Applicable Base Rate) that
means LIBOR might no longer be used and that its usage is subject
to restrictions or adverse consequences with effect from a date no
later than six months after the proposed effective date of such
Base Rate Modification,
where the proposed effective date is 25 July 2022 (being the
first Distribution Date falling after the occurrence of the events
set out in paragraph (a) and/or (b) above).
6. In connection with the Proposed Base Rate Modification, an
adjustment to the margin payable on the Class A1 Notes will be
made. The proposed method of calculation and intended date of
calculation is set out in Appendix 1 (Note Rate Maintenance
Adjustment) hereto. This adjustment is necessary, in the opinion of
the Issuer, in order to, so far as reasonably and commercially
practicable, preserve what would have been the expected Interest
Rate applicable to the Class A1 Notes had no Base Rate Modification
been effected.
7. Pursuant to Clause 9.2 of the Note Trust Deed and Condition
14.3 (Additional modification rights) the Note Trustee is required
to concur with the Issuer in making the Proposed Base Rate
Modification if:
(a) the Issuer has certified in writing to the Note Trustee that
it has not been notified that Noteholders representing at least 10
per cent. of the aggregate Note Principal Amount of either the
Class A1 Notes or the Class A2 Notes then Outstanding do not
consent to the Proposed Base Rate Modification; and
(b) all other conditions set out in Condition 14.3 (Additional
modification rights) have been satisfied.
8. Copies of the Note Trust Deed, drafts of the Amended
Documents and related documents may be inspected in electronic or
physical form during usual business hours at the registered office
of the Issuer or the Principal Paying Agent. Capitalised terms used
but not otherwise defined herein shall have the meanings given to
them in the documents specified in this notice, as applicable.
9. Pursuant to Clause 9.2 of the Note Trust Deed and Condition
14.3, the Issuer has provided each of the Rating Agencies with
notice in writing of the Proposed Base Rate Modification.
10. Noteholders holding Class A1 Notes or Class A2 Notes as at 6
April 2021 (the "Base Rate Modification Record Date") who wish to
notify the Issuer that they object to the Proposed Amendments must
do so by 4 p.m. (London time) on 26 April 2021 (the "Deadline"). No
physical meetings of Noteholders will be held.
11. NO ACTION IS REQUIRED TO BE TAKEN BY ANY NOTEHOLDER WHO DOES
NOT WISH TO OBJECT TO THE PROPOSED BASE RATE MODIFICATION.
12. Each Noteholder holding Class A1 Notes or Class A2 Notes
that wishes to vote to object to the Proposed Amendments must
ensure that it gives electronic voting instructions to the relevant
clearing system (in accordance with that clearing system's
procedures):
(a) TO REJECT the Proposed Amendments; and
(b) specifying the full name of the direct participant
submitting the voting instruction and the account number(s) for the
party making the voting submission(s),
such that the Tabulation Agent will receive that Noteholder's
voting instructions on or before the Deadline.
13. Any beneficial owner of Class A1 Notes or Class A2 Notes who
is not a direct participant in the clearing systems must contact
its broker, dealer, bank, custodian, trust company or other nominee
to arrange for the accountholder in Euroclear or Clearstream as the
case may be, through which it holds Class A1 Notes or Class A2
Notes to deliver an electronic voting instruction in accordance
with the requirements of the relevant clearing system.
14. By providing instructions as described above, each
beneficial owner of the Notes authorises the clearing systems at
which their account is maintained to disclose to the Tabulation
Agent, the Principal Paying Agent, the Note Trustee and the Issuer,
confirmation that they are the beneficial owner of such Class A1
Notes or Class A2 Notes and the Note Principal Amount of such Class
A1 Notes or Class A2 Notes.
15. If "No" votes are received from Noteholders equal to at
least 10 per cent. of the aggregate Note Principal Amount of either
the Class A1 Notes or the Class A2 Notes then Outstanding by the
Deadline, the Issuer will not be entitled to enter into the
Proposed Amendments unless an Extraordinary Resolution of the
Noteholders of the Senior Class then Outstanding is subsequently
passed approving the Proposed Amendments. Following expiry of the
Deadline, the Tabulation Agent will calculate the number of
objection instructions received and notify each of the Issuer, the
Note Trustee and the Security Trustee. If the 10 per cent.
threshold is not reached, the Issuer, the Note Trustee, the
Security Trustee and the other parties to the Amended Documents
will, provided all other necessary conditions have been satisfied
in accordance with the Transaction Documents and the Conditions,
enter into the Amended Documents on or around 6 May 2021 and
Noteholders will be bound by such Proposed Amendments. Votes
delivered in favour of the Proposed Amendments, votes submitted by
Noteholders holding Notes other than the Class A1 Notes and Class
A2 Notes and votes submitted by Noteholders who were not
Noteholders as at the Base Rate Modification Record Date will not
be counted.
16. Additional notifications will be made to Noteholders in
accordance with Condition 16 (Notices to Noteholders) as soon as
reasonably practicable following the Deadline, notifying
Noteholders of the voting results.
17. Noteholders with queries concerning the content of this
Notice are kindly requested to contact the Issuer, the Secretary of
State for Education in its capacity as the Master Servicer, HSBC
Bank plc in its capacity as the solicitation agent (the
"Solicitation Agent") or Lucid Issuer Services Limited as
tabulation agent (the "Tabulation Agent") using the details set out
below.
Contact Details:
Issuer: Income Contingent Student Loans 1 (2002-2006)
PLC
1 Bartholomew Lane
London, United Kingdom, EC2N 2AX
Facsimile: +44(0) 207 398 6325
Email: directors-uk@intertrustgroup.com
Attention: the Directors
Master Servicer: The Secretary of State for Education
Sanctuary Buildings
20 Great Smith Street
London
SW1P 3BT
Email: Master.Servicer@education.gov.uk
Attention: Sinead O'Sullivan, Susan Acland-Hood,
Ailsa Harris
Solicitation HSBC Bank plc
Agent: 8 Canada Square
London
E14 5HQ
Tel: +44 (0) 20 79926237
Email: LM_EMEA@hsbc.com
Attention: Liability Management Group
Tabulation Agent: Lucid Issuer Services Limited
Tankerton Works
12 Argyle Street
London
WC1H 8HA
Tel: +44 (0 )20 7704 0880
Email: icsl@lucid-is.com
Attention: Owen Morris / David Shilson
This Notice is given by
Income Contingent Student Loans 1 (2002-2006) PLC
as Issuer
Dated 26 March 2021
Appendix 1
Note Rate Maintenance Adjustment
The Proposal
Conversion of the base rate component of the Interest Rate
applicable to the Class A1 Asset-Backed Floating Rate Notes due
2056 (XS1722900518) issued by Income Contingent Student Loans 1
(2002-2006) PLC (the "Notes") from LIBOR to SONIA, with a
consequential adjustment to the current margin applicable to the
Interest Rate payable on the Class A1 Notes.
Rationale for the Proposal
The margin applicable to the Interest Rate in relation to the
Class A1 Notes on conversion of the base rate component of the
Interest Rate applicable to the Class A1 Notes from LIBOR to SONIA
will be amended to a margin which is equal to (a) the original
Class A1 Note margin plus (b) the Rate Adjustment (as such term is
defined below).
The Issuer, the Note Trustee, the Security Trustee and the other
parties to the Amended Documents will enter into the Amended
Documents on or around 6 May 2021 and Noteholders will be bound by
such Proposed Amendments. The Distribution Date on which the change
in reference rate from LIBOR to SONIA is proposed to occur will be
the Distribution Date falling in July 2022, being 25 July 2022 (the
"Effective Date").
For the avoidance of doubt, the reference rate applicable to the
Notes up to but excluding the Effective Date will continue to be
LIBOR and the interest payment made on the Effective Date will not
be affected by the pricing methodology described herein.
The Margin Adjustment
The Interest Rate applicable to the Class A1 Notes will, with
effect from the Effective Date, be an amount equal to the
Compounded Daily SONIA plus:
A. 1.00 per cent.; plus
B. the Rate Adjustment,
(the "Adjusted Class A1 Margin").
Where "Rate Adjustment" means 0.4644%, being the Spread
Adjustment (as defined in Supplement number 70 to the 2006 ISDA
Definitions (the "ISDA IBORs Fallback Supplement")) for 12 month
Sterling LIBOR, as specified on Bloomberg screen "SBP0012M Index",
or any successor page, as calculated by Bloomberg Index Services
Limited (or a successor provider as approved and/or appointed by
ISDA from time to time) in relation to 12 month Sterling LIBOR.
The method of calculation specified for the purposes of
calculating the Adjusted Class A1 Margin above accords with the
methodology for such adjustments contained in the ISDA IBORs
Fallback Supplement found at
http://assets.isda.org/media/3062e7b4/23aa1658-pdf/.
The detailed provisions relating to the calculation of
Compounded Daily SONIA are set out in the Amended Documents.
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END
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