Non-Standard Finance plc

('Non-Standard Finance', 'NSF' or the 'Company')

Update on scheme of arrangement ('Scheme')

(28 April 2023): Further to its announcement dated 17 March 2023 regarding the launch of the Scheme and Proposed Recapitalisation (the "17 March RNS"), Non-Standard Finance announces that the convening hearing in relation to the Scheme was held earlier today, at which the Court granted an order that Everyday Lending Limited ("ELL") can convene a meeting of the Scheme Creditors to consider and vote on the Scheme.

The creditors' meeting is currently scheduled to be held on 12 June 2023. If Scheme Creditors approve the Scheme, the Court sanction hearing is expected to be held on 22 June 2023. Once sanctioned, the effectiveness of the Scheme will then be conditional upon the Scheme Fund being funded through the proceeds of the Proposed Recapitalisation or, if the conditions to the Proposed Recapitalisation are not satisfied, the Alternative Transaction. Under the Scheme, based on the Group's current calculations, Scheme Creditors are now estimated to receive between 24% and 31% recovery.

The FCA's current views in relation to the Scheme are set out in a letter it sent the Company on 25 April 2023. The FCA's stated position is that it does not, at this stage, anticipate that it will oppose the Scheme from being sanctioned should the requisite majorities of Scheme Creditors vote in favour of the Scheme. The FCA does, however, fully reserve its position in respect of the Scheme and its right to object to the Scheme in due course, if the FCA considers it appropriate to do so.

The Group reminds shareholders that in the event the Scheme is sanctioned and the Proposed Recapitalisation takes place, although the Proposed Recapitalisation will ensure the future of the Group and the Everyday Loans business, it will materially dilute the interests of NSF's existing shareholders, most likely to negligible value, unless they choose to participate in the equity raise.

The Group also reminds shareholders that in the event that the Scheme is not sanctioned by the Court, or the Scheme is sanctioned but the Proposed Recapitalisation is unsuccessful, then the Alternative Transaction will be pursued involving a transfer of the ownership of the Group's business to the Group's secured lenders in exchange for the release of a portion of their secured debt and the provision of a new lending facility, resulting in no return for current shareholders. In the event that the Scheme is not sanctioned by the Court, or the Scheme is sanctioned but the Proposed Recapitalisation and Alternative Transaction both fail, then the Group would remain insolvent and the most likely outcome would be a Group-wide insolvency (most likely administration), also resulting in no return for current shareholders.

Unless otherwise defined, capitalised terms within this announcement shall have the same meaning as those contained within the 17 March RNS.

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