Odebrecht Finance Ltd. Announces Commencement Of A Consent Solicitation For Its 7.00% Senior Notes Due 2020
SAO PAULO, July 16, 2012 /PRNewswire/ -- Odebrecht Finance Ltd. ("Odebrecht Finance"), a financing subsidiary of Odebrecht S.A., announced today that it is soliciting consents (the "Consents"), pursuant to a consent solicitation (the "Consent Solicitation") from the holders of its 7.00% Senior Notes due 2020 (the "Notes") (CUSIP Nos. 675758AC0 and G6710EAD2), of which U.S.$500.0 million in aggregate principal amount is outstanding, to certain proposed amendments (the "Proposed Amendments") to the indenture governing the Notes (the "Indenture").
The Proposed Amendments include, but are not limited to: (1) deleting the covenants and related definitions with respect to (x) limitation on debt, (y) limitation on agreements restricting dividend payments and (z) limitation on transactions with affiliates (the "Non-Investment Grade Covenants"); (2) amending the limitation on liens covenant, certain events of default and related definitions to exclude non-significant subsidiaries and certain future "project" subsidiaries of Construtora Norberto Odebrecht S.A. ("CNO"); (3) amending the events of default relating to final judgment and cross acceleration by increasing the thresholds set forth therein from U.S.$50.0 million to U.S.$100.0 million; and (4) including a "Substitution of Issuer" provision and related definitions that would allow Odebrecht Finance to be substituted as issuer by (i) CNO or (ii) any wholly-owned subsidiary of CNO. Pursuant to the terms of the Indenture, the Non-Investment Grade Covenants are currently suspended and therefore do not currently restrict CNO and its subsidiaries because the Notes have attained investment grade ratings from two rating agencies. The Proposed Amendments would permanently delete the Non-Investment Grade Covenants so that such covenants would not be reinstated in the event that the Notes failed to maintain such investment grade ratings.
The provisions in the Proposed Amendments conform to the corresponding provisions set forth in: (1) the indenture, dated as of June 26, 2012, pursuant to which Odebrecht Finance's U.S.$600.0 million in aggregate principal amount of 5.125% Notes due 2022 were issued; and (2) the indenture, dated as of June 26, 2012, pursuant to which Odebrecht Finance's U.S.$400.0 million in aggregate principal amount of 7.125% Notes due 2042 were issued.
Holders of Notes should refer to the consent solicitation statement, dated July 16, 2012, and the related consent letter (together, the "Consent Documents"), for the detailed terms and conditions of the Consent Solicitation. The Consent Solicitation was commenced today and will expire at 5:00 p.m. (New York City time) on July 23, 2012, unless extended by Odebrecht Finance (such date and time, as the same may be extended by Odebrecht Finance, is referred to as the "Expiration Time"). The Consent Solicitation is made solely by means of the Consent Documents. These materials contain important information that holders of Notes should carefully read before any decision is made with respect to the Consent Solicitation.
Only holders of the Notes as of 5:00 p.m. (New York City time) on July 13, 2012 (such date and time, including as such date and time may be changed by Odebrecht Finance, the "Record Date") are entitled to consent to the Proposed Amendments. In order to implement the Proposed Amendments, Odebrecht Finance and the trustee will enter into a supplemental indenture to the Indenture (the "Supplemental Indenture") if the Required Consents (as defined below) are obtained. If the Supplemental Indenture is executed and the other terms and conditions set forth in the Consent Documents are satisfied or waived, then holders of Notes as of the Record Date will receive a cash payment equal to U.S.$2.50 per U.S.$1,000 principal amount of Notes in respect of which consent letters and Consents to the Proposed Amendments have been validly delivered prior to the Expiration Time. Holders will not be permitted to revoke Consents at any time. A Holder cannot consent to only a portion of the Proposed Amendments. The delivery by a Holder of a consent letter will constitute a Consent by such Holder to all of the Proposed Amendments.
In order to execute and deliver the Supplemental Indenture as contemplated by the Proposed Amendments, Odebrecht Finance must receive Consents from holders as of the Record Date representing at least a majority of the aggregate principal amount of the Notes (not including any Notes that are owned by Odebrecht Finance or any of its affiliates) (the "Required Consents").
Odebrecht Finance reserves the right, in its sole discretion, to modify the Consent Documents and the terms and conditions of the Consent Solicitation or to terminate the Consent Solicitation at any time.
The Information Agent for the Consent Solicitation is:
D.F. King & Co., Inc.
Banks and Brokers call: +1 (212) 269-5550 (collect)
All others call toll-free: +1 (800) 488-8035
E-mail: [email protected]
Any questions or requests for assistance or for copies of the Consent Documents may be directed to the Information Agent at its telephone number set forth above. A holder as of the Record Date also may contact either Solicitation Agent at the following telephone numbers: Deutsche Bank Securities Inc. at +1 (212) 250-2955 (collect) or +1 (866) 627-0391 (toll-free); and Goldman, Sachs & Co. at +1 (212) 902-5183 (collect) or +1 (800) 828-3182 (toll-free); or such holder's broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Consent Solicitation.
THIS PRESS RELEASE IS NEITHER AN OFFER TO SELL NOR THE SOLICITATION OF AN OFFER TO BUY ANY NOTE. THIS ANNOUNCEMENT IS ALSO NOT A SOLICITATION OF CONSENTS TO THE PROPOSED AMENDMENTS. NO RECOMMENDATION IS MADE AS TO WHETHER HOLDERS OF THE NOTES SHOULD CONSENT TO THE PROPOSED AMENDMENTS.
SOURCE Odebrecht Finance Ltd.
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