RCS - DTEK Renew. Fin B.V. - DTEK Renewables Consent Solicitation

Bank Of New York MellonAnnouncement

15/09/2022 17:45

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RNS Number : 6574Z  DTEK Renewables Finance B.V.  15 September 2022

THIS ANNOUNCEMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. NOT FOR
RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY
JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS
OR REGULATIONS OF THAT JURISDICTION.

 

15 September 2022

DTEK RENEWABLES FINANCE B.V. ANNOUNCES A CONSENT SOLICITATION

 

DTEK RENEWABLES FINANCE B.V.

(a private company with limited liability (besloten vennootschap met beperkte
aansprakelijkheid) incorporated under the laws of The Netherlands, with
registered office at Strawinskylaan 1531, Tower B, Level 15, grid
TB-15-046/089, 1077XX, Amsterdam, The Netherlands, and registered with the
Dutch Trade Register of the Chamber of Commerce under number 34389118)

 

 

Solicitation of Consents

under the trust deed dated 12 November 2019 (as amended and supplemented by
the supplemental trust deed dated 12 May 2022) in relation to the

€325,000,000 8.50% Senior Notes due 2024 issued by DTEK Renewables Finance B.V.

(ISIN XS2069980246/ XS2070013250) (the "Notes")

 

DTEK Renewables Finance B.V. (the "Issuer") today announces a consent
solicitation to seek the consent of holders (the "Noteholders") of the
outstanding Notes to certain Proposals (such solicitation, as may be amended
from time to time, the "Consent Solicitation").

 

The Consent Solicitation is being made on the terms, and subject to the
conditions, contained in the consent solicitation memorandum dated 15
September 2022 (the "Consent Solicitation Memorandum"). Capitalized terms used
but not defined in this announcement have the same meaning ascribed to them in
the Consent Solicitation Memorandum. Copies of the Consent Solicitation
Memorandum can be obtained (subject to eligibility) via the following website:
https://renewables.dtek.com/en/ir/bonds-reporting/
(https://renewables.dtek.com/en/ir/bonds-reporting/) .
(https://renewables.dtek.com/en/ir/bonds-reporting/)

 

Background to the Proposals

 

On 24 February 2022, Russian forces commenced a military operation across
the Ukrainian state, in response to which the Government of Ukraine declared
martial law and the National Bank of Ukraine imposed a moratorium on
cross-border payments. On 28 February 2022, the Chamber of Commerce and
Industry of Ukraine confirmed that the ongoing hostilities had resulted in the
occurrence of a force majeure situation in Ukraine. As a result, the Group has
experienced a number of significant challenges and disruptions, including, but
not limited to:

 

·      The Group's electricity production decreased by approximately 64%
during the five month period from March 2022 to August 2022 compared to the
same period in 2021, from 954 GWh to 343 GWh.

 

·      On 24 February 2022, Ukrenergo instructed all Ukrainian
renewable energy producers to cease production in order to ensure conditions
for the stability and balancing of the Ukrainian energy sector. Such
restrictions were lifted on 2 March 2022, but only the Group's solar power
plants have since been able to recommence operations. The Group's wind power
assets, which represent approximately 50% of the Group's total generation
capacity, are not currently operating, either because the local electricity
grid has been damaged or because operations have been temporarily suspended
due to the proximity of the military activity. Generation at Trifanovskaya SPP
has been low since May 2022 due to damage caused to the local distribution
network and regular shelling in the area. The Group intends  to  file  an
application to the European Court of Human Rights, and is considering
the submission of additional claims, against the Russian Federation in
respect of losses suffered.

 

·      The level of settlements from the Guaranteed Buyer was 90% for
2021, 94% for the first two months of 2022, 17% for March through May 2022 and
reached 25%, 33% and 50% in June 2022, July 2022 and August 2022,
respectively. The Guaranteed Buyer owed €46.9 million to the Group as of 1
September 2022, of which €20.5 million relates to electricity purchased in
2021. Moreover, the exchange rate for calculation of the FiT was fixed by the
regulator at the level of the daily average exchange rate for December 2021.

 

·      The volume of curtailment services requested by Ukrenergo from
the Group for the period from February 2022 to September 2022 has
significantly increased compared to the same period last year. However, only
21% of the cost of such services provided by the Group has been paid.

 

·      The Group temporarily suspended the construction of the
Tiligulskaya Project at the beginning of the war. Nevertheless, as at the date
of this Memorandum, the Group has managed to launch five turbines at
Tiligulskaya WPP and intends to continue construction in due course.

 

In response to such challenges and disruptions, the Issuer solicited consents
from Noteholders  to various amendments to the Trust Deed (the "Amendments")
pursuant to a consent solicitation memorandum dated 27 April 2022 (the "April
2022 Consent Solicitation"). The Issuer obtained sufficient consents from
Noteholders in the April 2022 Consent Solicitation, and a Supplemental Trust
Deed dated 12 May 2022 amending and supplementing the Trust Deed in the form
of the Amendments was executed, whereupon the Amendments became effective.
Among other matters, pursuant to the Amendments, during the period from 12 May
2022 to the date falling not later than 11 November 2022 (the "Support
Period"), the Issuer is not required to maintain sufficient funds in the
Interest Reserve Account to pay interest due on the next Interest Payment Date
in accordance with Condition 4.2. To ensure the economically equitable
treatment as between the Noteholders and the Project Finance Lenders, the
Group also used funds held in the debt service reserve accounts in respect of
Project Finance Debt to make the next scheduled payments of interest and
principal under the Project Finance Debt.

 

Despite some positive dynamics in the Ukrainian energy market in recent weeks,
the Group continues to face significant risks and impediments, including
limited payment discipline from the Guaranteed Buyer. In this environment it
remains critical that the Group continues to conserve sufficient liquidity in
order to enable it to protect its assets, operations and employees.
Accordingly, while the Issuer intends to pay the interest coupon due on the
Notes on 12 November 2022 in full, pursuant to the Consent Solicitation, it is
requesting the consent of Noteholders to waive any Event of Default that may
occur and be existing under the Notes as a result of any failure by it to
maintain sufficient funds in the Interest Reserve Account at any time while
martial law is in effect in Ukraine. Further, given the ongoing threats to the
Group's assets and operations, pursuant to the Consent Solicitation, the
Issuer is also requesting the consent of Noteholders to waive certain
additional Events of Default that may occur and be existing under the Notes.

 

The Proposals
 

Accordingly, the Group has launched the Consent Solicitation in order to
solicit Consents to waive any Event of Default:

 

1.  that may occur and be existing at any time during the Waiver Period under
Condition 11.1.2 as a result of any failure by the Issuer to maintain in the
Interest Reserve Account an amount in euro at least equal to the amount of
interest due to be paid on the Notes on the next upcoming Interest Payment
Date in accordance with Condition 4.2;

 

2.  that may occur and be existing at any time during (i) the Waiver Period,
or (ii) the Remedy Period, in each case, under Condition 11.1.3 as a result of
any failure by the Issuer or any Guarantor to comply with its obligations
under Condition 5.10 as a result of the occurrence of military operations on
the territory of Ukraine, unless the Issuer is unable to pay any amount of
principal or interest on the Notes when due as a result thereof;

 

3.  that may occur and be existing at any time under Condition 11.1.4 as a
result of any payment default under or the acceleration of any Indebtedness
for money borrowed of, or the payment of which is guaranteed by, any Material
Subsidiary that is not a Guarantor, unless the Issuer is unable to pay any
amount of principal or interest on the Notes when due as a result thereof;

 

4.  that may occur and be existing at any time under Condition 11.1.5 as a
result of any distress, attachment, execution or other similar legal process
being levied, enforced or sued on or against substantially all of the assets
or revenues of any Material Subsidiary that is not a Guarantor, unless the
Issuer is unable to pay any amount of principal or interest on the Notes when
due as a result thereof;

 

5.  that may occur and be existing at any time under Condition 11.1.6 as a
result of any encumbrancer taking possession of or selling or otherwise
enforcing, or the levying of any expropriation or sequestration against
substantially all of the assets or revenues of any Material Subsidiary that is
not a Guarantor, unless the Issuer is unable to pay any amount of principal or
interest on the Notes when due as a result thereof;

 

6.  that may occur and be existing at any time under Condition 11.1.7 as a
result of any final, non-appealable judgment or order being made against any
Material Subsidiary that is not a Guarantor, unless the Issuer is unable to
pay any amount of principal or interest on the Notes when due as a result
thereof;

 

7.  that may occur and be existing at any time under Condition 11.1.8(B)(1)
as a result of the Nationalisation of all or substantially all of the assets
of any Guarantor or Material Subsidiary, unless the Issuer is unable to pay
any amount of principal or interest on the Notes when due as a result thereof;

 

8.  that may occur and be existing at any time under Condition 11.1.9(B) as a
result of any Material Subsidiary or Guarantor ceasing to carry on all or
substantially all of its business or operations as a result of military
operations being conducted on the territory of Ukraine, unless the Issuer is
unable to pay any amount of principal or interest on the Notes when due as a
result thereof;

 

9.  that may occur and be existing at any time under Condition 11.1.10 as a
result of the Nationalisation of all or a material part of the assets of the
Parent and its Material Subsidiaries, taken as a whole, by the Russian
Federation, unless the Issuer is unable to pay any amount of principal or
interest on the Notes when due as a result thereof;

 

10.       that may occur and be existing at any time under Condition
11.1.11 as a result of military operations being conducted on the territory of
Ukraine, unless the Issuer is unable to pay any amount of principal or
interest on the Notes when due as a result thereof; and

 

11.       that may occur and be existing at any time under Condition
11.1.17 to the extent the relevant event has an analogous effect to any of the
events waived under paragraphs (1) to (10) above,

 

paragraphs (1) through (11) above, collectively, the "Waivers".

 

By giving its Consent, each Noteholder also irrevocably authorises and
instructs the Tabulation Agent to promptly (and in any event, on the same
Business Day as the Requisite Consents are obtained) execute and deliver the
Waiver Confirmation Notice to the Issuer and the Trustee in accordance with
Clause 9.2 of the Trust Deed and Condition 11.2. The Waivers shall become
effective once the Requisite Consents (being Consents from Noteholders holding
at least a majority in aggregate principal amount of the Notes then
outstanding) have been received and the Waiver Confirmation Notice has been
executed and delivered by the Tabulation Agent to the Issuer and the Trustee.
For the avoidance of doubt, the Waiver Confirmation Notice may be delivered
after the Consent Deadline.

Indicative Timetable for the Consent Solicitation

Noteholders should take note of the times and dates set out below in
connection with the Consent Solicitation. The times and dates are indicative
only and are subject to change in accordance with the terms of the Consent
Solicitation. Accordingly, the actual timetable may differ from the expected
timetable set out below.

 

 

 Event                                                                            Time and Date
 Commencement of the Consent Solicitation                                         15 September 2022

 The Consent Solicitation is announced.

 Memorandum becomes available on the Consent Solicitation Website.
 Effective Time                                                                   The time at which the Requisite Consents have been obtained (which, for the

                                                                                avoidance of doubt, may be at or prior to the Consent Deadline) and the Waiver
 The Tabulation Agent shall, promptly upon receipt of the Requisite Consents      Confirmation Notice has been delivered to the Issuer and the Trustee.
 (and in any event, on the same Business Day as the Requisite Consents are
 obtained) at or prior to the Consent Deadline, deliver the Waiver Confirmation
 Notice to the Issuer and the Trustee.
 Consent Results Announcement                                                     As soon as reasonably practicable after the Effective Time.

 Announcement that the Requisite Consents have been obtained and the Waiver
 Confirmation Notice has been delivered to the Issuer and the Trustee.
 Consent Deadline                                                                 26 September 2022 (4:00 p.m. (London time))

 The final deadline for the Noteholders to submit their Consent Instructions.

 The Consent Solicitation will expire on the Consent Deadline, provided that,
 if the Requisite Consents have not been achieved at or prior to the Consent
 Deadline, as soon as reasonably practicable after such Consent Deadline, the
 Issuer will announce whether it will terminate, extend or re-open the Consent
 Solicitation (in each case, subject to applicable law and the provisions of
 the Trust Deed).

 

The above times and dates are subject to the right of the Issuer to extend,
re-open, amend and/or terminate the Consent Solicitation (subject to
applicable law, the provisions of the Trust Deed and as provided in the
Consent Solicitation Memorandum). Noteholders are advised to check with any
bank, securities broker, custodian or other intermediary through which they
hold Notes whether such intermediary needs to receive instructions from a
Noteholder before the deadlines set out above in order for that Noteholder to
be able to participate in, or (in the limited circumstances in which
revocation is permitted) revoke their instruction to participate in, the
Consent Solicitation. The deadlines for the delivery of a Consent Instruction
set by any such intermediary and each Clearing System through which Notes are
held may be earlier than the deadlines above.

Further Information

 

A complete description of the procedures in relation to the terms of the
Consent Solicitation are set out in the Consent Solicitation Memorandum.

Holders are advised to read the Consent Solicitation Memorandum carefully for
full details and information on the procedures for participating in the
Consent Solicitation. The Bank of New York Mellon, London Branch is acting as
Tabulation Agent.

Requests for all information in relation to the Consent Solicitation should be
directed to:

 

The Tabulation Agent

 

The Bank of New York Mellon, London Branch

160 Queen Victoria Street

London

EC4V 4LA

United Kingdom

 

Email: debtrestructuring@bnymellon.com

Telephone: +44 (0) 1202 689644

 

 

Copies of the Consent Solicitation Memorandum are available to eligible
persons upon request from the Tabulation Agent free of charge.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

This announcement has been prepared by the Issuer exclusively for information
purposes. It does not constitute or include any advice or recommendation by
the Issuer (or any other person) regarding the securities of the Issuer or as
to the merits of any transaction or the making of any investment decision. It
does not constitute or include any confirmation or commitment by the Issuer
(or any other person) regarding the present or future value of the business of
the Group, its securities, its affiliates or any of the Group's or their
assets.

 

Neither this announcement nor the Consent Solicitation Memorandum constitutes
or forms part of, and should not be construed as, an offer for sale or
subscription of, or a solicitation of any offer to buy or subscribe for, any
securities of the Issuer or any other entity in any jurisdiction.

 

The distribution of this announcement and the Consent Solicitation Memorandum
in certain jurisdictions may be restricted by law. Persons into whose
possession this announcement or the Consent Solicitation Memorandum comes are
required by the Issuer and the Tabulation Agent to inform themselves about,
and to observe, any such restrictions. This announcement and any materials
relating to the Consent Solicitation do not constitute, and may not be used in
connection with, any form of offer or solicitation in any place where such
offers or solicitations are not permitted by law.

 

This announcement may include "forward-looking" statements within the meaning
of applicable securities laws. Any such statements reflect the current views
of the Group about further events and performance. No assurances can be given
that such events or performance will occur as projected and actual results may
differ materially from these projections.

 

 

Please address any questions or concerns to: Oksana Nersesova

+442039806598

ir@dtek.com (mailto:ir@dtek.com)

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