Consent solicitation with Noteholders

Dignity plc
("Dignity", the "Company" or the "Group")

CONSENT SOLICITATION WITH NOTEHOLDERS

Proposal offers additional financial flexibility and deleveraging for the Group

Dignity, the UK's leading provider of funeral plans and end of life services, notes the announcement made today by Dignity Finance PLC ("Dignity Finance"), a Group subsidiary, of the launch of a consent solicitation with its Noteholders in relation to a deleveraging proposal ("Consent Proposal").

As stated in the Group's 2021 annual results, following the award of a temporary covenant waiver by the Class A Noteholders, the Company has continued to work on a long term solution to improve the Group's capital structure. As part of implementing this strategy, Dignity is now seeking certain consents from Noteholders for a potential transaction involving the realisation of value from selected crematoria assets, with the proceeds of such a transaction being applied in a partial redemption of the Class A Notes, as required by the current documentation. These consents, if approved, will apply for 12 months following approval by the Class A Noteholders.

As part of the Consent Proposal, Dignity is also seeking a series of amendments to provisions within the financing documents in order to provide operational flexibilities and to bring the Dignity financing structure more in line with recent securitisation structures.

As a condition to this Consent Proposal, Dignity will be required to inject a minimum of £70 million into the securitisation group companies to partially repay some of the Class A Notes outstanding (including the payment of a redemption premium) in consideration for assets leaving the securitisation group, if a potential transaction in relation to the crematoria assets becomes unconditional within 12 months of the Class A Noteholders' approval referred to above. This will result in a deleveraging of the Group and a positive impact on the underlying financial ratios.

The assets which are subject to the proposals are seven crematoria where the freehold and leasehold properties are owned by companies outside of the securitisation group and leased to Dignity Funerals Limited (a company in the financing ringfence). The portfolio is expected to generate a total of £6.7m EBITDA (2022 Budget) for the Group. As part of any potential transaction involving these crematoria assets, Dignity may enter into an agreement to continue to operate these assets (e.g. a master services agreement).

Dignity Finance has accordingly launched a Consent Proposal with its Class A Noteholders. Further information on the Consent Proposal can be found within the announcement made by Dignity Finance.

The Consent Proposal has been considered by a special committee (the "Special Committee") consisting of Noteholders and convened by The Investment Association at the request of Dignity Finance. The members of the Special Committee, who hold in aggregate approximately 61 per cent of the current principal amount outstanding of the Class A Notes have examined the proposal and have informed Dignity Finance that they find it acceptable.

Kate Davidson, Chief Executive of Dignity, commented: "The proposal announced today marks a key milestone in ensuring the Company's capital structure supports our new strategic goals and vision for the Group. If Noteholder consent is provided, it would enhance operational flexibilities in alignment with recent securitisation terms and unlock greater investment into our properties, facilities and people, to grow and strengthen Dignity."

For further information please contact:

Forward-looking statements

This announcement and the Dignity plc investor website may contain certain 'forward-looking statements' with respect to Dignity plc ('the Company') and the Group's financial condition, results of its operations and business, and certain plans, strategy, objectives, goals and expectations with respect to these items and the economies and markets in which the Group operates.

Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as 'anticipates', 'aims', 'due', 'could', 'may', 'should', 'will', 'would', 'expects', 'believes', 'intends', 'plans', 'targets', 'goal' or 'estimates' or, in each case, their negative or other variations or comparable terminology. Forward-looking statements are not guarantees of future performance. By their very nature forward-looking statements are inherently unpredictable, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. The forward-looking statements in this announcement are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, management's examination of historical operating trends, data contained in the Company's records and other data available from third parties. Many of these assumptions, risks and uncertainties relate to factors that are beyond the Group's ability to control or estimate precisely. There are a number of such factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, changes in the economies and markets in which the Group operates; changes in the legal, regulatory and competition frameworks in which the Group operates; changes in the markets from which the Group raises finance; the strength of competitors; the impact of legal or other proceedings against or which affect the Group; future plans and potential for future growth; changes in accounting practices and interpretation of accounting standards under IFRS, and changes in interest and exchange rates. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, and the Company may not achieve or accomplish these expectations, beliefs or projections. Neither the Company, nor any of its members, directors, officers, agents, employees or advisers intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this announcement.

Any forward-looking statements made in this announcement or the Dignity plc investor website, or made subsequently, which are attributable to the Company or any other member of the Group, or persons acting on their behalf, are expressly qualified in their entirety by the factors referred to above. Each forward-looking statement speaks only as of the date it is made. Except as required by its legal or statutory obligations, the Company does not intend to update any forward-looking statements.

Nothing in this announcement or on the Dignity plc investor website should be construed as a profit forecast or an invitation to deal in the securities of the Company.

Legal Entity Identifier number:

Dignity plc - 21380049687CNAYKV483