DST Update 18/08/2009

DST Update 18/08/2009

The DAG nominees to the KSFIOM Creditors' Committee ("CC") have recently concluded the negotiations with PwC on the form of confidentiality undertaking ("CU") relating to the disclosures to be made to the CC, and the form of this CU is being uploaded to the site for your reference.

A confidentiality undertaking of some sort is common practice for creditors' committees generally and DST accepted that some form of CU was required to protect the interests of all creditors.

The form that was originally proposed by PwC was far too restrictive, one-sided and unaccountable. Apparently not all non-retail members of the CC agreed with DST's approach. Nevertheless, DST made the decision to appoint and fund legal advice on the matter on behalf of all four retail depositors on the CC. Having engaged Jonathan Smalley on the IOM to advise, and after long negotiations with PwC, we have reached what we view as an acceptable compromise that benefits all the members of the CC and their constituent creditors.

DAG members should note that the terms of the CU make disclosed matters generally confidential and that therefore some sensitive things will not be capable of discussion by CC members.

However, to mitigate this, the CU provides that updates following CC meetings will be posted by PwC on the KSFIOM site, and that PwC will seek to agree exclusions from those updates with the CC. If agreement cannot be reached with the majority of the CC, the ultimate recourse will be to the court to determine whether or not something should be disclosed.

This CU does not prevent DST raising legitimate issues and queries with CC members for airing at CC meetings.

The first CC meeting is tomorrow (19 August). The DST CC nominees look forward to working with PwC to maximise the recovery from the KSFIOM assets and to work towards a 100% recovery for all creditors.

To view the original form with marked changes in order to see the amendments achieved click this link: http://www.ksfiomdepositors.org/public-page/nda-final-agreed-version-mark


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