For each US$1,000.00 stated face value of Old Notes, tendering holders of Old Notes will, on the settlement date for the Exchange Offer, receive New Notes with a principal amount equal to US$1,038.542 plus an additional principal amount (the "Additional Principal Amount") representing the amount of interest accrued on such Old Notes, at a rate of 12.5% per annum, from and including December 14, 2016 to, but not including, the settlement date.
No other payments, including in respect of principal, interest (including accrued or default interest other than the Additional Principal Amount as described above) or additional amounts (if any), will be required to be paid to Holders.
The principal objective of the Exchange Offer is to refinance the Old Notes and avoid a potential concurso mercantil proceeding in Mexico. The Company does not have the means to repay the amounts that are payable under the Old Notes. The Company believes that it is currently not likely to find a material source of financing to fund the interest and principal payments on the Old Notes and that the completion of the Exchange Offer is critical to resolving its constrained liquidity and ensuring its continued viability. The Company also believes that the Exchange Offer would benefit both Holders and the Company by helping the Company to avoid contentious litigation that could cause business disruptions or damage to the overall value of its business. In addition, the terms of the New Notes provide that the Company will not, and will not permit any of its subsidiaries to, directly or indirectly make any payment of principal, interest or otherwise in respect of the Old Notes unless the holder of such Old Notes obtains a final non-appealable judgment in its favor.
The Company reserves the right, subject to applicable law and to a restructuring support agreement entered into with certain holders of Old Notes, to extend or terminate the Exchange Offer, or otherwise amend the terms of the Exchange Offer. If any tendered Old Notes are not accepted for exchange, such Old Notes will be returned without expense to the tendering holder.
The consummation of the Exchange Offer is subject to the conditions set forth in the Information Memorandum, which the Company may assert or waive in full or in part subject to certain limitations, including the condition that at least 95% in aggregate outstanding principal amount of the Old Notes (including any Old Notes which are owned by the Company or its affiliates) be validly tendered and not validly withdrawn on or prior to the Expiration Time.
Interest on the New Notes will accrue at the rate of 11.5% per annum (or, in the case of interest that is elected to be capitalized pursuant to the PIK Option (defined below), 12.5%) and will be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, commencing on March 31, 2017 (each, an "Interest Payment Date"). The Company may elect to exercise its option to pay a portion of the interest on the New Notes due on each Interest Payment Date by capitalizing such interest and adding it to the principal amount of the New Notes (the "PIK Option") for interest periods ending on or prior to June 30, 2019. The principal of the New Notes will be amortized in 8 installments on March 31, June 30, September 30 and December 31 of each year, commencing on September 30, 2019.
The complete terms and conditions of the Exchange Offer are described in the Information Memorandum, copies of which may be obtained by eligible holders by contacting Epiq Corporate Restructuring, the information and exchange agent for the Exchange Offer, via email at email@example.com (please reference "Arendal" in the subject line).
This press release is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell any securities. The Exchange Offer is being made and the New Notes are being offered only to "qualified institutional buyers," holders that are not "U.S. persons" and certain institutional investors that are "accredited investors" as such terms are defined under the Securities Act. The New Notes have not been registered under the Securities Act or under any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act, and, accordingly, are subject to significant restrictions on transfer and resale as more fully described in the Information Memorandum. The Exchange Offer is subject to the terms and conditions set forth in the Information Memorandum.
Arendal is a procurement and construction company operating in Mexico. Arendal provides a full range of procurement and construction services, including feasibility studies, acquisition of rights of way, conceptual design, engineering, procurement, project and construction management, construction, maintenance, technical site evaluations and other consulting services.
This release contains certain forward-looking statements regarding the future events or the future financial performance of Arendal. These statements reflect management's current views with respect to future events or financial performance, and are based on management's current assumptions and information currently available and are not guarantees of the Company's future performance. The timing of certain events and actual results could differ materially from those projected or contemplated by the forward-looking statements due to a number of factors including, but not limited to those inherent to operating in a highly regulated industry, strong competition, commercial and financial execution and economic conditions, among others.
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