U.S.J. - Açúcar e Álcool S.A. Announces Extension And Amendment Of The Exchange Offer And Consent Solicitation For Any And All Of Its (i) 9.875% Senior Notes Due 2019 And (ii) 9.875%/12.00% Senior Secured PIK Toggle Notes Due 2021

SÃO PAULO, May 8, 2019 /PRNewswire/ -- U.S.J. – Açúcar e Álcool S.A. (the "Company") announced today that it has extended and amended its previously announced private offer to exchange (the "Exchange Offer") any and all of its outstanding (i) 9.875% Senior Notes due 2019 (the "2019 Notes") and (ii) 9.875%/12.00% Senior Secured PIK Toggle Notes due 2021 (the "2021 Notes" and, together with the 2019 Notes, the "Existing Notes") for its newly issued 9.875%/10.500% Senior Secured PIK Notes Due 2023 (the "New Notes") and, in the case of 2019 Notes only, New Notes and cash, and its concurrent solicitation of consents (the "Consent Solicitation" and, together with the Exchange Offer, the "Exchange Offer and Consent Solicitation") to (i) certain proposed amendments to the indenture governing the 2021 Notes, which would eliminate substantially all of the restrictive covenants and certain events of default and related provisions under such indenture and (ii) termination of the security agreements and release the security interests in the collateral securing the 2021 Notes (collectively, the "Proposed Amendments").  

The Exchange Offer and Consent Solicitation are being extended and will now expire at 11:59 p.m., New York City time, on May 21, 2019, unless further extended by the Company (such time and date, as the same may be extended, the "Expiration Date"). The Exchange Offer and Consent Solicitation were previously scheduled to expire at 11:59 p.m., New York City time, on May 14, 2019. As of 11:59 p.m., New York City time, on May 6, 2019, Eligible Holders (as defined below) had validly tendered and delivered consents with respect to (i) U.S.$4,406,000.00 in aggregate principal amount of the 2019 Notes, representing 15.14% in aggregate principal amount of the outstanding 2019 Notes; and (ii) U.S.$39,760,836.00 in aggregate principal amount of the 2021 Notes, representing 16.02% in aggregate principal amount of the outstanding 2021 Notes.  

Eligible Holders who now validly tender their Existing Notes and deliver their consents at or prior to the Expiration Date, will receive the "Exchange Consideration" of (i) in the case of the 2019 Notes, for each U.S.$1,000 principal amount of Existing Notes accepted for exchange, cash in an amount equal to U.S.$333 plus New Notes in an amount equal to U.S.$667, and (ii) in the case of the 2021 Notes, for each U.S.$1,000 principal amount of Existing Notes accepted for exchange, U.S.$1,000 principal amount of New Notes.

Holders who tender 2021 Notes must also consent to the Proposed Amendments.  Holders of 2021 Notes may not deliver consents to the Proposed Amendments without validly tendering the 2021 Notes in the Exchange Offer for the New Notes and may not revoke their consents without withdrawing the previously tendered 2021 Notes to which they relate. The Proposed Amendments will be set forth in a supplemental indenture relating to the 2021 Notes and are described in more detail in the Exchange Offer Memorandum. Adoption of the Proposed Amendments requires the delivery of consents by holders of 2021 Notes of at least 66-2/3% of the aggregate outstanding principal amount of 2021 Notes.

2019 Notes tendered may be withdrawn at any time prior to the Expiration Date, but not thereafter, unless required by applicable law. 2021 Notes tendered may be withdrawn and consents for the Proposed Amendments delivered may be revoked at any time prior to the execution of the supplemental indenture, but not thereafter, unless required by applicable law.

The Exchange Consideration will include accrued and unpaid interest on Existing Notes accepted for exchange, at a rate of 10.500% per annum instead of the applicable rate under the Existing Notes, from the last interest payment date of the Existing Notes up to but excluding the settlement date, which will be added to the principal amount of the New Notes. 

The consummation of the Exchange Offer and Consent Solicitation are conditioned upon the valid tender, without subsequent withdrawal, of at least 60% of the aggregate principal amount of the outstanding 2019 Notes and at least 90% of the aggregate principal amount of the outstanding 2021 Notes.  The consummation of the Exchange Offer and Consent Solicitation are also subject to the filing for registration with the competent registries in Brazil of the instruments for Release of the collateral securing the 2021 Notes and of the instruments establishing the fiduciary assignment and pledge of the collateral securing the New Notes, and the satisfaction or waiver of certain other conditions. In addition, the Company has the right to terminate or withdraw the Exchange Offer and Consent Solicitation and extend the Expiration Date in its sole discretion, subject to applicable law.

The amended terms and conditions of the Company's offer to Eligible Holders (as defined below), including amendments to the terms of the New Notes, are set forth in the Company's Exchange Offer Memorandum and Consent Solicitation Statement, dated March 25, 2019, as supplemented by the offering memorandum supplement dated May 1, 2019 (the "Supplement No. 1") and the offering memorandum supplement dated May 8, 2019 (the "Supplement No. 2").

The Exchange Offer and Consent Solicitation is being made, and the New Notes are being offered and will be issued, only:

(a) in the United States, to holders of Existing Notes who are "Qualified Institutional Buyers" (as defined in Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"));

(b) outside the United States, subject to items (c) and (d) below, to holders of Existing Notes who are persons other than "U.S. Persons" (as defined in Regulation S under the Securities Act);

(c) in the EEA, to holders of Existing Notes who are (i) persons other than U.S. Persons, and (ii) who are not retail investors. For the purposes hereof, the expression retail investor means a person who is (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, "MiFID II"); (ii) a customer within the meaning of Directive 2002/92/EC (as amended, the "Insurance Mediation Directive"), where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) "Qualified Investors" as defined in Directive 2003/71/EC (as amended, the "Prospectus Directive");

(d) in the UK, to holders of Existing Notes who are persons other than U.S. Persons, and who are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); (ii) persons who are within Article 43(2) of the Order; or (iii) high net worth companies, and other persons, falling within Article 49(2)(a) to (d) of the Order.

The holders of Existing Notes who have certified to the Company that they are eligible to participate in the Exchange Offer and Consent Solicitation pursuant to at least one of the foregoing conditions are referred to as "Eligible Holders."

The Exchange Offer and the New Notes have not been, and will not be, registered with the Brazilian Comissão de Valores Mobiliários (CVM). The Exchange Offer and the New Notes are not offered or sold in Brazil, except in circumstances that do not constitute a public offering or unauthorized distribution under Brazilian laws and regulations.

The New Notes have not been registered under the Securities Act or any state securities laws.  Accordingly, the New Notes will be subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and other applicable securities laws, pursuant to registration or exemption therefrom.

This press release is neither an offer to sell nor the solicitation of an offer to buy any security. This press release is also not a solicitation of any consent to the Proposed Amendments. The Exchange Offer and Consent Solicitation is being made solely pursuant to the Exchange Offer Memorandum, the Supplement No. 1 and the Supplement No. 2. No recommendation is made as to whether the holders of Existing Notes should tender their Existing Notes for exchange and deliver their consents in the Exchange Offer and Consent Solicitation.

D.F. King & Co., Inc. has been appointed as the information agent and the exchange agent for the Offer. Holders may contact the information agent to request the eligibility letter at (212) 269-5550 or toll free at (877) 283-0318.

NOTICE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains statements that are forward-looking within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company that may cause the actual results to be materially different from any future results expressed or implied in such forward-looking statements. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to the Company's management, the Company cannot guarantee future results or events. The Company expressly disclaims a duty to update any of the forward-looking statements.

SOURCE U.S.J. - Açúcar e Álcool S.A.