5th Dec 2008 09:00
HBOS plc
5 December 2008
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
Modification to Preference Scheme
On 14 November 2008, HBOS published a Preference Scheme Circular which sets out the proposals which the Lloyds TSB Board wishes to put forward to HBOS Preference Shareholders and ADS holders (the "Preference Scheme"). Capitalised terms used in this announcement shall have the same meaning as defined terms used in the Preference Scheme Circular.
A letter has today been posted by HBOS to holders of HBOS 9¼% Preference Shares and HBOS 9¾% Preference Shares (the "Relevant Preference Shares") confirming that, if the Preference Scheme becomes effective in relation to either or both classes of Relevant Preference Shares, Lloyds TSB will make a payment to the holders of either or both classes of the Relevant Preference Shares (as applicable) of 0.375% of the aggregate nominal amount of such shares held by them (the "Additional Consideration"), in addition to the New Lloyds TSB Preference Shares to be issued to them pursuant to the Preference Scheme. The letter constitutes a modification to the Preference Scheme in accordance with paragraph 9 thereof.
Under the terms of the modified Preference Scheme, the Additional Consideration will be paid only to holders of the Relevant Preference Shares and not to holders of any other class or classes of preference shares.
The Lloyds TSB Board has advised HBOS that the Additional Consideration is being offered in recognition of the fact that, unlike the existing HBOS 9¼% Preference Shares and the HBOS 9¾% Preference Shares which contain a requirement that all dividends are to be declared and paid in cash, subject only to the availability of sufficient distributable reserves and distributable profits and compliance with the capital adequacy requirements of the FSA, the terms of the relevant New Lloyds TSB Preference Shares contain a discretion for the board of Lloyds TSB to resolve that no dividend be declared or that a dividend be paid in part only.
The Lloyds TSB Board has also advised HBOS that the modified Preference Scheme has been considered by a special committee (the "Special Committee") of the Association of British Insurers (the "ABI"). The members of the Special Committee together hold approximately 33.9 per cent. of the outstanding Sterling-denominated HBOS Preference Shares. The members of the Special Committee have examined the modified Preference Scheme and informed Lloyds TSB that they find the modified Preference Scheme acceptable, that they intend to vote in favour of the resolutions in respect of their holdings and that they invite other members of the ABI to consider a similar course of action.
Copies of the modified Preference Scheme will be available for inspection during normal business hours on any Business Day at the offices of HBOS plc, The Mound, Edinburgh, EH1 1YZ, United Kingdom and at the offices of Allen & Overy LLP, One Bishops Square, London, E1 6AD up to and including the Effective Date (or, if applicable, the date the Preference Scheme lapses or is withdrawn).
The Preference Scheme Circular is available on the HBOS website
(www.hbosplc.com/investors/default.asp).
The prospectus relating to Lloyds TSB and the preference shares to be issued by Lloyds TSB under the Preference Scheme is available on the Lloyds TSB website
(www.investorrelations.lloydstsb.com/ir/homepage.asp).
Contacts
Investor Relations:
Charles Wycks
Director of Investor Relations
+44 (0)20 7905 9600
Press Office:
Shane O'Riordain
General Manager, Group Communications
+44 (0)131 243 7195
+44 (0)7770 544585 (mobile)
shaneo'[email protected]
Related Shares:
Lloyds