Continuation Proposals

Inland ZDP PLC

 Continuation proposals in relation to Zero Dividend Preference Shares

ZDP Shares continuation proposals

Inland ZDP PLC (the 'Company') has issued 12,444,200 Zero Dividend Preference Shares ('ZDP Shares') which fall due for redemption on 10 April 2019. As announced on 8 May 2018, Inland Homes plc (the holding company of Inland ZDP PLC) consulted major ZDP Shareholders in relation to refinancing options, which include the possibility of a deferral of the redemption date of the existing ZDP Shares (with an appropriate increase in the Final Capital Entitlement), certain possible changes to the terms of the Loan Note, Contribution Agreement and related security documentation and an opportunity for those ZDP Shareholders who wish to realise their investment in ZDP Shares to do so.

Based on feedback from the major ZDP Shareholders, the Board and its advisers have formulated preliminary continuation proposals ahead of the ZDP Share redemption date in relation to a possible extension of the life of the ZDP Shares, for which holders of approximately 54 per cent. of the ZDP Shares in issue have indicated their support.

The preliminary proposals are currently being presented to other ZDP Shareholders and potential placees and are expected to include:

- extension of the life of the ZDP Shares for a further five years to 10 April 2024;

- tender offer for the existing issued ZDP Shares (with extended life as mentioned above), subject to scaling down (the "Tender Offer");

- new ZDP Final Capital Entitlement commensurate with the proposed new Gross Redemption Yield of 5.25 per cent. for the additional five year period;

- removal of the gearing covenant, retaining and enhancing the cover ratio covenant;

- variations to certain terms of the loan arrangements between the Company and Inland Homes PLC and the Company's articles of association; and

- placing of ZDP Shares tendered under the Tender Offer and placing of new ZDP Shares (up to a maximum number which is just under 20 per cent. of the ZDP Shares currently in issue) to raise cash for the Inland Group, subject to demand.

A further announcement is expected to be made in the next few weeks. Should the Company decide to proceed with the continuation and finalise its terms, a circular would be published and the proposals put to a General Meeting of the Company, a class meeting of the Ordinary Shareholder and a class meeting of ZDP Shareholders with a view to their coming into effect in August 2018, subject to the passing of the necessary resolutions.

Background

The Company was incorporated on 22 November 2012 as a wholly owned subsidiary of Inland Homes plc ('Inland').

The Company was formed especially for the issuing of ZDP Shares. It raised £8,500,000 before expenses on 20 December 2012 by a placing of 8,500,000 ZDP Shares, which are listed on the UK Official List and admitted to trading on the London Stock Exchange. Further issues in each subsequent year have increased the number of ZDP Shares in issue to 12,444,200.

The Company has lent the proceeds received from all the ZDP Share issues to Inland, subject to the terms of Loan Notes and security documentation. The loan is non-interest bearing and is repayable on 10 April 2019 or, if required by the Company, at any time prior to that date in order to repay the ZDP Share entitlement. The funds raised form part of the Inland Group's financing arrangements for its property development business.

The proposed variations to the Loan Notes primarily comprise the removal of a gearing covenant and the enhancement of the protections afforded to the Company under the Cover Test. These changes arise from the evolution of the Inland Group's business which now includes additional housebuilding with a shorter working capital cycle than the time it takes to obtain planning consents and effect the remediation of brownfield land. No change is proposed to the security arrangements whereby the Company has the benefit of first charges over tangible assets with a book value of 120 per cent. of the accrued liability to ZDP Shareholders.

A contribution agreement between the Company and Inland has also been made whereby Inland undertakes to contribute such funds as would ensure that the Company will have in aggregate sufficient assets on 10 April 2019 to satisfy the final capital entitlement of the ZDP Shares.

MAR

This announcement contains inside information for the purposes of Article 7 of the Regulation (EU) No 596/2014 on Market Abuse. Upon the publication of this announcement this information is considered to be in the public domain.

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