Southern Pacific Financing seeks holder consent for floating-rate notes

By Jennifer Chiou

New York, Oct. 24 – Southern Pacific Financing 06-A plc and Southern Pacific Financing 05-B plc announced the start of their consent solicitations to amend the liquidity facility agreement for various classes of their mortgage-backed floating-rate notes.

The following Southern Pacific Financing 06-A notes are affected:

• £372.96 million of class A mortgage-backed floating-rate notes due 2044;

• £14.7 million of class B mortgage-backed floating-rate notes due 2044;

• £19.11 million of class C mortgage-backed floating-rate notes due 2044;

• £9.45 million of class D1 mortgage-backed floating-rate notes due 2044; and

• £3.78 million of class E mortgage-backed floating-rate notes due 2044.

The following Southern Pacific Financing 05-B notes are affected:

• £397.44 million of class A mortgage-backed floating-rate notes due 2043;

• £34.56 million of class B mortgage-backed floating-rate notes due 2043;

• £19.2 million of class C mortgage-backed floating-rate notes due 2043;

• £21.6 million of class D mortgage-backed floating-rate notes due 2043; and

• £7.2 million of class E mortgage-backed floating-rate notes due 2043.

According to a filing with the London Stock Exchange, Lloyds Bank plc, which is the liquidity facility provider, is requesting that Southern Pacific Financing obtain holder authorization for certain amendments at the cost of Lloyds Bank.

The proposed changes include, among other things, a reduction to the costs currently paid to the issuers by Lloyds.

The first extraordinary resolution for holders of the Southern Pacific Financing 06-A notes involves reducing the size of the commitment under the liquidity facility, while the second extraordinary resolution for the same noteholders involves amending the rating trigger for any stand-by drawing to reflect the current published criteria of the rating agencies.

The extraordinary resolution for holders of the Southern Pacific Financing 05-B notes involves, among other things, reducing the size of the commitment under the liquidity facility.

For the Southern Pacific Financing 06-A notes and for holders of the other series delivering consent for the first extraordinary resolution, Lloyds is offering a consent fee at varying rate for each class multiplied by the outstanding principal amount of notes held by a consenting noteholder. The rate is 0.2% for the class A notes, 0.3% for the class B notes, 0.4% for the class A notes, 0.5% for the class A notes and 0.6% for the class A notes.

For the Southern Pacific Financing 05-B notes, the fee rate is a flat 0.1% per amount held for the second extraordinary resolution.

The final voting deadline is set for Nov. 17. Noteholder meetings are to be held in London on Nov. 19.

The principal paying agent is the Bank of New York Mellon, London Branch (attn: Corporate Trust Administration, Structured Finance; fax 44 20 7964 6399).

The tabulation agent is Lucid Issuer Services Ltd. (attn: Victor Parzyjagla; 44 20 7704 0880; spf@lucid-is.com).

The issuers are based in London.

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