JZ Capital Ptnrs Ltd Smaller Related Party Transaction

 
TIDMJZCP TIDMJZCN 
 
JZ CAPITAL PARTNERS LIMITED (the "Company" or "JZCP") 
(a closed-end collective investment scheme incorporated with limited liability 
           under the laws of Guernsey with registered number 48761) 
 
                           LEI: 549300TZCK08Q16HHU44 
 
                    REDUCTION OF COMMITMENTS TO ORANGEWOOD 
                       Smaller Related Party Transaction 
 
17 September 2020 
 
On 15 July 2020, the Company announced that David W. Zalaznick and John (Jay) 
Jordan II (together, being the "JZAI Founders", who are the founders and 
principals of the Company's investment adviser, Jordan/Zalaznick Advisers, Inc. 
("JZAI")) had agreed in principle to relieve the Company of certain of its 
commitments to Orangewood Partners II-A, L.P. (the "Orangewood Fund") by each 
of them assuming the obligation of approximately US$2 million of those 
commitments. 
 
Further to that announcement, the Company is now pleased to report that it has 
yesterday entered into an agreement with the JZAI Founders (or their respective 
affiliates) for the reduction of the Company's commitments to its investments 
in the Orangewood Fund in the amount of US$4.25 million (the "Orangewood 
Transaction"). The Orangewood Transaction is considered to be a smaller related 
party transaction of the Company pursuant to chapter 11 of the listing rules 
made by the Financial Conduct Authority pursuant to section 73A of the 
Financial Services and Markets Act 2000, as amended (the "Listing Rules") 
(insofar as they apply to the Company by virtue of its voluntary compliance 
with the same). 
 
Prior to the Orangewood Transaction, the Company had capital commitments to the 
Orangewood Fund of US$23.25 million, of which approximately US$7.85 million had 
been funded (the "JZCP Funded Commitments") and approximately US$15.40 million 
remained as being unfunded (the "JZCP Unfunded Commitments"). 
 
Consistent with the Company's previously announced desire to reduce its 
commitments and future subscription obligations in accordance with its recently 
amended investment policy, the Company has therefore reduced its commitments to 
the Orangewood Fund by US$4.25 million pursuant to the Orangewood Transaction, 
with such commitments being taken over by the JZAI Founders (or their 
respective affiliates). Specifically, the reduction in the Company's 
commitments to the Orangewood Fund has been effected by the JZAI Founders (or 
their respective affiliates) having: 
 
 a. sold, transferred and assigned to them approximately US$1.43 million of the 
    JZCP Funded Commitments (the "Transferred JZCP Funded Commitments"); and 
 b. assumed approximately US$2.82 million of the commitments, liabilities, 
    duties, responsibilities and obligations in respect of the JZCP Unfunded 
    Commitments (the "Transferred JZCP Unfunded Commitments"). 
 
The price payable by the JZAI Founders (or their respective affiliates) to the 
Company for the transfer of their commitments is approximately US$1.51 million, 
which is equivalent to the Transferred JZCP Funded Commitments of US$1.43 
million plus interest accrued thereon at a rate of 8 per cent. per annum from 
the date such commitments were funded to 15 September 2020. The Company intends 
to utilise the proceeds received in connection with the Orangewood Transaction 
in accordance with the Company's recently revised investment policy. 
 
The resultant effect of the Orangewood Transaction is that the Company has had 
its commitments to the Orangewood Fund reduced by US$4.25 million, with the 
Company receiving an amount of approximately US$1.51 million in cash, less 
expenses associated with the Orangewood Transaction. In addition, the Company 
is being relieved of its obligations to fund in cash commitments of 
approximately US$2.82 million relating to the Transferred JZCP Unfunded 
Commitments. 
 
JZAI is the Company's investment adviser pursuant to an investment advisory and 
management agreement dated 23 December 2010 between the Company and JZAI, as 
amended from time to time, and, under the Listing Rules, would therefore be 
considered a "Related Party" of the Company (as defined in the Listing Rules 
insofar as they apply to the Company by virtue of its voluntary compliance with 
the same). As founders and principals of JZAI, the JZAI Founders are associates 
of JZAI and would also be considered Related Parties of the Company. In 
addition, each of the JZAI Founders are substantial shareholders of the Company 
as they are each entitled to exercise or to control the exercise of 10 per 
cent. or more of the votes able to be casted at a general meeting of the 
Company. As such, each of the JZAI Founders are considered to be Related 
Parties of the Company on this basis as well. The Orangewood Transaction, which 
involves the JZAI Founders as Related Parties of the Company, would be 
considered to involve arrangements between the Company and its Related Parties. 
The Orangewood Transaction does however fall within Listing Rule 11.1.10 R and 
is a smaller related party transaction under the Listing Rules (insofar as they 
apply to the Company by virtue of its voluntary compliance with the same). The 
Company has obtained written confirmation from J.P. Morgan Securities plc 
(which conducts its UK investment banking business as J.P. Morgan Cazenove) 
that the terms of the Orangewood Transaction are fair and reasonable as far as 
the shareholders of the Company are concerned. This announcement is made in 
accordance with Listing Rule 11.1.10 R (c). 
 
In addition to the Orangewood Transaction, the Company is pleased to announce 
that it intends to enter into an agreement with a third party institutional 
investor to effect a further reduction of the Company's commitments to its 
investments in the Orangewood Fund in the amount of US$5 million. Pursuant to 
this agreement, if entered into and completed, the Company would reduce its 
commitments to the Orangewood Fund by a further US$5 million, of which 
approximately US$1.69 million would represent funded commitments and 
approximately US$3.31 million would represent unfunded commitments to the 
Orangewood Fund. The price that would be payable by the relevant third party 
institutional investor to the Company for the transfer of these commitments 
would be approximately US$1.78 million, which is equivalent to the funded 
commitments of US$1.69 million plus interest accrued thereon at a rate of 8 per 
cent. per annum from the date such commitments were funded to the date of 
closing. This agreement would be subject to certain conditions to closing and 
upon being entered into would be expected to close and become effective on or 
about 21 September 2020. 
 
Following completion of the Orangewood Transaction and this other agreement 
with the third party investor (assuming it is entered into and completed on the 
terms described above), the Company's remaining commitments to the Orangewood 
Fund would amount to US$14 million, of which approximately US$4.72 million 
would represent funded commitments and approximately US$9.28 million would 
represent unfunded commitments. The Company's intention with respect to any 
remaining commitments to the Orangewood Fund is still, as previously announced, 
to further reduce them such that the balance of its commitments are if and to 
the extent possible transferred in full. 
 
For further information: 
 
Ed Berry                                +44 (0) 20 3727 1046 
FTI Consulting 
 
David Zalaznick                         +1 (212) 485 9410 
Jordan/Zalaznick Advisers, Inc. 
 
Sam Walden                              +44 (0) 1481 745385 
Northern Trust International Fund 
Administration Services (Guernsey) 
Limited 
 
 
 
END
(END) Dow Jones Newswires
September 17, 2020 02:00 ET (06:00 GMT)
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