The Schahin Group Announces Information Regarding Lancer Finance Co. Ltd.'s 5.85% Senior Notes Due 2016
SAO PAULO, Sept. 2, 2015 /PRNewswire/ -- The Schahin Group (the "Company") announced today that it had previously engaged in negotiations with certain holders of, or managers of entities holding beneficial interests in, the above-captioned notes (the "Notes," and such holders of the Notes, together with the managers of entities holding beneficial interests in the Notes, the "Noteholders") of which approximately US$42 million in principal amount plus accrued interest is outstanding, following the draw down on certain letters of credit, and the foreclosure upon certain cash and the proceeds of such letter of credit, all of which had collateralized the Notes, and the application of the proceeds of the foregoing collateral to the outstanding principal and accrued interest on the Notes.
Prior to the date hereof, the Company executed confidentiality agreements (the "Confidentiality Agreements") with certain of the Noteholders to facilitate discussions concerning the Company's potential alternatives for a possible transaction (a "Transaction") regarding the S.C. Lancer vessel (the "Vessel") and certain related obligations. While negotiations between the Noteholders and the Company may continue in the future, there can be no assurance that negotiations will continue, or, if they do continue, that they will result in an agreement regarding the terms of a Transaction.
Pursuant to the Confidentiality Agreements, upon the expiration of a period set forth in the Confidentiality Agreements, any Noteholder may request that the Company disclose certain confidential information that the Company has provided to the Noteholders (the "Qualified Confidential Information"). Therefore, upon the formal request of the Noteholders, the Company hereby agreed to disclose publicly the information included in this press release, which is being attached and furnished to satisfy the Company's public disclosure obligations of all material and certain other Qualified Confidential Information under the Confidentiality Agreement. The Company also agreed to disclose publicly certain other information provided to certain of the Noteholders (the "Other Information"), which Other Information the Company previously confirmed is not restricted by the Confidentiality Agreements.
Qualified Confidential Information
Representatives of the Company and the Company's financial and legal advisors (the "Company Representatives") provided to the representatives of certain of the Noteholders and the Noteholders' financial and legal advisors (the "Noteholder Representatives") the following financial and operational information regarding the Vessel:
- A budget dated of June 10, 2015 of the monthly costs to maintain the Vessel in good condition and operating with safety crew for the upcoming periods in two different scenarios: navigating in deep waters (as is currently the case) and anchored.
- A third-party valuation of the Vessel performed in December 2014;
- The authorization issued by the Brazilian Maritime Authority for the Vessel to remain in Brazilian Jurisdictional Waters until August 28, 2015;
- The documents evidencing the importation of the Vessel to Brazil;
- Trading certificates for the Vessel;
- A written term sheet sent on June 8, 2015 representing the terms of a potential transaction, by which the Company was willing to consensually transfer control of the Vessel to the Noteholders; and
- Documentation regarding authority to keep the Vessel in Brazilian jurisdictional waters.
Other Information
- The Company's insurance policy, a recent endorsement to such policy that separated the payment obligation for each vessel operated by the Schahin group, a schedule of the insurance premiums relating to the Vessel and communications regarding the Company's insurance premium obligations, all of which were provided in connection with the Company's request that the Noteholders assume the obligation to fund the Company's insurance premium obligations with respect to the Vessel.
In addition to the disclaimers and qualifiers set forth in the materials themselves, all statements made in the Qualified Confidential Information or the Other Information were in the nature of settlement discussions and compromise, are not intended to be and do not constitute representations of any fact or admissions of any liability, and were for the purpose of attempting to reach a consensual compromise and settlement. Nothing contained in the Qualified Confidential Information or the Other Information is intended to or shall be construed to be an admission or a waiver of any rights, remedies, claims, or causes of action or defenses. The information contained in the Qualified Confidential Information or the Other Information is for discussion purposes only and shall not constitute a commitment to vote for or consummate any transaction described therein. The Noteholders have informed the Company that none of the Noteholders is a temporary insider or fiduciary of the Company or any of its subsidiaries or affiliates or any creditor or equity owner of the Company or any of its subsidiaries or affiliates, and each of the Noteholders expressly disclaims any purported fiduciary duty to any such parties.
SOURCE Schahin Engenharia S/A
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