End of Life Proposals
28 Mars 2008 - 6:06PM
UK Regulatory
US SPECIAL OPPORTUNITIES TRUST PLC - End of life proposals
28 March 2008
Further to the announcement made on 6 March 2008, the Board has been
considering the terms of proposals to put to shareholders in advance of the
scheduled wind up date of the Company of 30 May 2008.
The proposals have been formulated following a detailed review by the Board of
the current portfolio. The managers believe certain investments in the
portfolio will require a longer period of time to deliver potential value than
the 30 May 2008 wind up date will allow. Generally, the portfolio faces
significant liquidity constraints; several investments have very poor liquidity
whilst some only trade on a matched bargain basis. The Board is also concerned
that current market conditions do not offer the best backdrop against which to
make realisations.
The proposals currently being considered are as follows:
* Zero Dividend Preference Shareholders (save for certain overseas
shareholders) will be entitled to be repaid an amount equal to their final
capital entitlement per ZDP Share in cash on or shortly after the current
wind up date of 30 May 2008 via a tender offer;
* the life of the Company will be extended until 31 May 2010 and the existing
classes of Income Shares and Capital Shares will be retained;
* the investment objective and policy of the Company will be amended and the
portfolio will be managed with the aim of maximizing the returns to
Shareholders over the extended life of the Company. This may include an
element of gearing if appropriate;
* a tender offer will be made to Income Shareholders (save for certain
overseas shareholders) at 100p per share (irrespective of the actual asset
values of the shares), so as to provide a cash exit on or around 30 May 2008
for a basic entitlement of 50 per cent of their shareholding with the
opportunity to elect for a greater percentage should other Income Shareholders
elect for less than their basic entitlement;
* the rights of the Income Shares will be amended so as to provide Income
Shareholders with a revised and increased final capital entitlement per
Income Share on 31 May 2010: the proposal is that, on a winding-up or
return of capital, and subject to sufficiency of assets, the remaining
Income Shareholders will be entitled to a final capital entitlement on 31
May 2010 of �1.1344 per Income Share;
* The Capital Shareholders will continue to be entitled to all surplus assets
of the Company available for distribution on a winding-up;
* The voting rights of the Income Shares and the Capital Shares will be
adjusted following the tender offer to protect the class rights of the
Income Shares;
* an interim dividend will be paid on or shortly after the current wind up
date of 30 May 2008 to Income Shareholders equal to an amount of the
revenue reserves and accrued income to the record date less certain costs;
* Income Shareholders will continue to enjoy such dividends as may be
generated from surplus income from the portfolio although the managers will
not have a yield objective; and
* The terms of the existing management agreement will be amended to include a
lower base management fee and an appropriate performance fee.
A circular in relation to these proposals is expected to be published in early
May for approval at separate class meetings of Income Shareholders, Capital
Shareholders and ZDP Shareholders and an Extraordinary General Meeting of the
Company to be convened on 30 May 2008. If the proposals are not approved by
Shareholders, a resolution will be proposed at a Second Extraordinary General
Meeting convened for the same day at which a resolution to wind up the Company
voluntarily will be put. Weighted voting rights under the Articles mean that
this resolution will be passed if put.
Enquiries:
Cenkos Securities plc- William Rogers/Dion Di Miceli 0207 3971920/1921
Duncan Abbot, Chairman Tel: 07702 776320
END
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