FESCO obtains shareholders’ approval for Guarantee in respect of the Notes
Far-Eastern Shipping Company PLC has announced that on 20th October 2017, FESCO obtained an approval from the requisite majority of its shareholders with respect to the guarantee provided by FESCO, to the holders of the outstanding 8.00% Senior Secured Notes due 2018 and 8.75% Senior Secured Notes due 2020 on 6th September 2017, in support of the obligations under the USD Notes.
The provision of the Guarantee, with shareholder approval to be obtained as a condition subsequent, formed part of the restructuring terms agreed between FESCO and the ad hoc group of Noteholders (the “AHG”) earlier this year.
Obtaining shareholder approval of the Guarantee by 20 October 2017 was one of the key milestones under the terms of the standstill and lock-up agreement between, among others, FESCO and certain of the Noteholders (the “LUA”) dated 6th September 2017. FESCO confirms that the relevant milestone has therefore been satisfied.
The Group also confirms that all other milestones due to be fulfilled up until today’s date under the LUA have been satisfied. This includes providing the AHG’s advisors with a copy of the final term sheet of the debt financing required for implementing the restructuring; circulation of the Practice Statement Letter to Noteholders; circulation of the Explanatory Statement to Noteholders and the convening of a Scheme Meeting by the relevant milestone deadlines as set out under the LUA.
As announced on 11th October 2017, the High Court of Justice of England and Wales (the "Court"), by an order dated 11th October 2017, has directed that a scheme meeting (the “Scheme Meeting”) shall be convened of Noteholders, being scheme creditors (the “Scheme Creditors”), on 27th October 2017 for the purposes of considering and, if thought fit, approving a scheme of arrangement (the “Scheme”) to implement the restructuring of the Group’s indebtedness under the USD Notes.
The Group strongly encourages the Scheme Creditors to exercise their rights to vote at the Scheme Meeting. The Group reminds Scheme Creditors that the Voting Instruction Deadline is 5 p.m. (London time) on Wednesday, 25th October 2017, being the latest time and date for which the Information Agent must receive an Account Holder Letter and Sub-Proxy, if applicable, in order for Scheme Creditors’ voting instructions to be taken into account for the Scheme Meeting.
The Group also reminds each Noteholder who is a “Consenting Noteholder” under the LUA that it undertook, under clause 4.1 of the LUA, to vote (or cause the relevant person to vote) in favour of the Scheme to implement the restructuring.
Scheme Creditors should refer to the Explanatory Statement, and notice of the Scheme Meeting circulated on 11th October 2017 for further details on the applicable procedures and requirements in order to participate in the Scheme Meeting. Scheme Creditors are directed, in particular, to Section 6 (Summary of actions to be taken by Scheme Creditors and any Person with an Interest in the Notes) and Appendix 2 (Instructions and Guidance for Scheme Creditors and any Person with an Interest in the Notes) of the explanatory statement.
The Scheme Meeting will be held on 27th October 2017. If approved at the Scheme Meeting, the Scheme will be subject to subsequent approval of the Court at a sanction hearing that is currently scheduled to take place on 3rd November 2017.