Highclere Holdings again seeks bondholder OK for vessel sale

By Toni Weeks

San Luis Obispo, Calif., April 9 – Highclere Holdings Ltd. is again seeking bondholder approval from holders of its senior secured callable bonds, issue 2013/2015 for a vessel sale, according to a notice from trustee Nordic Trustee ASA.

Although a sale of the same vessel was approved by 100% of bondholders present at a meeting in December, the purchaser did not complete the $12 million sale, despite paying a $1.2 million deposit and a $400,000 fee for delaying the sale date.

Since then, discussions between the issuer and the purchaser have continued, and the two parties intend to enter into a second memorandum agreement. Under the new terms, the vessel will be sold for $6.2 million instead of $12 million, and the closing date will be April 17.

The board of directors of Highclere supports the vessel sale and is seeking bondholder approval at an upcoming bondholders meeting on April 16. In addition, 75% of the company’s shareholders will also need to approve the vessel sale.

According to the notice, Highclere has discussed the vessel sale with a group of large bondholders, who together hold more than two-thirds of the outstanding bonds and 75% of the issued shares. This group has agreed to support the vessel sale and vote in favor of the proposal at the bondholders’ meeting.

Liquidation after transaction

As announced on Nov. 27, Highclere sought approval of a vessel sale from holders of the 2013/2015 bonds, which are secured by a mortgage over the vessel. In order for the vessel sale to take place, the mortgage over the vessel will need to be released upon closing of the sale, according to a previous notice.

The company noted that the vessel being sold is the only asset of the Highclere group and that once the sale goes through, there are no other sources of recovery under the bonds.

The company plans to distribute proceeds from the vessel sale and any remaining funds available, less a $50,000 holdback, through a partial repayment of the outstanding bonds.

As soon as possible after the partial repayment, the company intends to be voluntarily liquidated (on a solvent basis) in the Cayman Islands. Bondholders will need to release any outstanding bond claim they may have against the company following the partial repayment, the previous notice said.

The total principal amount of bonds issued as of April 9 was $36,395,333. Highclere issued an initial $20 million of the bonds on Feb. 25, 2013, an additional $8.25 million of the bonds on July 25, 2013 and another $8,145,333 on Dec. 2, 2013.

Under the bond agreement, the company may issue $17,604,667 of additional bonds.

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