Empresa Generadora de Electricidad Itabo, S.A. Commences Solicitation of Consents Relating to a Proposed Waiver of certain requirements under the Indenture governing its 7.95% Senior Notes due 2026

SANTO DOMINGO, Dominican Republic, Aug. 13, 2020 /PRNewswire/ -- Empresa Generadora de Electricidad Itabo, S.A. ("Itabo") announced today that it has commenced a solicitation (the "Solicitation") of consents ("Consents" or, singular, "Consent") of holders ("Holders") of notes units in an aggregate principal amount of US$370,000,000 (collectively, the "Notes Units") consisting of (i) US$99,900,000 aggregate principal amount of 7.950% Senior Notes due 2026 issued by Itabo (the "Itabo Notes") and (ii) US$270,100,000 aggregate principal amount of 7.950% Senior Notes due 2026 co-issued jointly and severally by AES Andres B.V. and Dominican Power Partners, and unconditionally and irrevocably guaranteed by AES Andres DR, S.A. (the "Andres-DPP Notes"), upon the terms and subject to the conditions set forth in a Consent Solicitation Statement (as it may be amended or supplemented from time to time, the "Consent Solicitation Statement"), dated as of August 13, 2020, to a proposed waiver (the "Proposed Waiver") of certain requirements under the indenture, dated as of May 11, 2016 (the "Itabo Indenture"), by and among Itabo, as issuer, Citibank N.A., as trustee, principal paying agent, registrar and transfer agent (the "Trustee"), and Banque Internationale à Luxembourg SA, as special paying agent and transfer agent in Luxembourg, governing the Itabo Notes. Capitalized terms used in this announcement that are not otherwise defined herein have the meanings set forth in the Consent Solicitation Statement or the Itabo Indenture.

The Notes Units are identified by CUSIP No. 00809Y AB4, ISIN No. US00809YAB48 (144A)/ CUSIP No. N01008 AB2, ISIN No. USN01008AB2 (REGS) and each US$200,000 aggregate principal amount of Notes Units consist of (i) US$54,000 in aggregate principal amount of Itabo Notes and (ii) US$146,000 in aggregate principal amount of Andres-DPP Notes.

Itabo is soliciting Consents from the Holders of the Notes Units to the Proposed Waiver to waive the requirement under the Itabo Indenture for Itabo to commence an Offer to Purchase and make a Change of Control Payment in connection with the sale of 100% of the equity of Coastal Itabo Ltd. (the owner of 100% of Itabo's class B shares, which represent 50% of the total number of Itabo's subscribed and paid in shares) to Inversiones  Radiante S.R.L. ("Inversiones Radiante"), a member of Grupo Linda (the "Sale"), as further described in the Consent Solicitation Statement.  The Sale represents a transfer of all of The AES Corporation's 43% indirect ownership of Itabo.

Subject to the terms of the share purchase agreement and related agreements, AES Dominicana will continue to operate and manage Itabo for at least a three-year period following the consummation of the Sale with an automatic renewal clause. This will ensure that the same standards, policies and level of service will be maintained at Itabo.  Upon consummation of the Sale, Grupo Linda will indirectly control Itabo through Inversiones Radiante, which will own 50% of Itabo's capital stock, the Dominican government will continue to own 49.97% and 0.03% will be continue to be owned by former employees of the Dominican Corporation of State Electricity Companies (Corporación Dominicana de Empresas Eléctricas Estatales).

The Solicitation will expire at 5:00 p.m., New York City time, on August 21, 2020, or such later time and date to which the Solicitation is extended (such time and date, the "Consent Date"), unless earlier terminated.  The Solicitation is subject to customary conditions, including, among other things, the receipt of valid Consents with respect to a majority in aggregate principal amount of the outstanding Notes Units (the "Requisite Consents") prior to the Consent Date (which Consents are not revoked on or prior to the effectiveness of the Proposed Waiver). The payment of the Consent Fee (as defined below) is conditioned to the consummation of the change of control transaction described in the Consent Solicitation Statement. The Proposed Waiver will become effective with respect to the Itabo Notes upon receipt by Itabo of the Requisite Consents which have not been revoked and the execution and delivery of a supplemental indenture (the "Supplemental Indenture") by Itabo and the Trustee (which may occur prior to the Consent Date if the Requisite Consents are received before that date, the "Effective Time").  After the Proposed Waiver becomes effective, all current Holders of Itabo Notes, including non-consenting Holders and all subsequent Holders, will be bound by the Proposed Waiver. However, the Supplemental Indenture, and the Proposed Waiver contained therein, will not become operative and the Consent Fee will not become payable unless all conditions to the Solicitation and the payment of the Consent Fee described in the Consent Solicitation Statement are satisfied or, where possible, waived, including the consummation of the change of control transaction. If the Requisite Consents are not received prior to the Consent Date, the Supplemental Indenture will not be executed, the Proposed Waiver will not become operative and the Consent Fee (defined below) will not be paid.

In the event that each of the conditions to the Solicitation described in the Consent Solicitation Statement are satisfied, including, but not limited to, the receipt of the Requisite Consents and the consummation of the change of control transaction, Itabo will, within five business days following the consummation of the change of control transaction described in the Consent Solicitation Statement, pay to each Holder  from whom a Consent is properly received and unrevoked by the Consent Date a fee (the "Consent Fee") equal to US$5.00 in cash for each US$1,000 principal amount of Notes Units. For the avoidance of doubt, since the Itabo Notes trade as part of Notes Units, the Consent Fee shall be calculated in respect of the aggregate principal amount of the Notes Units outstanding.

Holders of Notes Units who deliver Consents but validly revoke their Consent in accordance with the Consent Solicitation Statement prior to the earlier of the Effective Time and the Consent Date, or who deliver Consents after the Consent Date, will not receive a Consent Fee.  Subject to applicable law, the Solicitation may be abandoned or terminated for any reason at any time, including after the Consent Date and prior to the Proposed Waiver becoming effective, as described above, whether or not the Requisite Consents have been received, in which case any Consents received will be voided and no Consent Fee will be paid to any Holders.

Itabo has engaged Citigroup Global Markets Inc. to act as Solicitation Agent and Global Bondholder Services Corporation to act as Information and Tabulation Agent for the Solicitation.  Questions regarding the Solicitation may be directed to Citigroup Global Markets Inc. 388 Greenwich Street, 7th Floor New York, New York 10013 or at U.S. Toll Free:  (800) 558-3745/Collect:  (212) 723-6106.  Requests for documents relating to the Solicitation may be directed to Global Bondholder Services Corporation at (866) 470-4500 (toll-free), (212) 430-3774 (banks and brokers) or by email to [email protected].

This press release is for informational purposes only and the Solicitation is only being made pursuant to the terms of, and subject to the conditions specified in, the Consent Solicitation Statement.  The Solicitation is not being made to, and Consents are not being solicited from, Holders of Notes Units in any jurisdiction in which it is unlawful to make such Solicitation or grant such Consent. None of Itabo, the Trustee, the Solicitation Agent or the Information and Tabulation Agent makes any recommendation as to whether or not Holders should deliver Consents.  Each Holder must make its own decision as to whether or not to deliver Consents.  This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities.  The securities described herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws, and they may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act.

About Empresa Generadora De Electricidad Itabo, S.A.

Empresa Generadora de Electricidad Itabo, S.A. is a corporation (sociedad anónima) organized under the laws of the Dominican Republic. It is indirectly controlled by The AES Corporation, which, through its subsidiary AES Grand Dominicana, indirectly owns 100% of Itabo's class B shares, which represent 50% of the total number of Itabo's subscribed and paid in shares. As of December 31, 2019, Itabo's total current assets were US$122.6 million. In 2019, Itabo reported operating income of US$64.8 million and net comprehensive income of US$43.7 million.

Forward-Looking Statements

This press release may contain forward-looking information and statements regarding Itabo and the Solicitation. Any statements included in this press release that address activities, events or developments that Itabo will or may occur in the future are forward looking statements, these include among others, statements as to: (i) the Proposed Waiver, and (ii) the expected payment of the Consent Fee.  Actual results may differ materially due to a variety of important factors, such factors might include: changed market conditions, the participation of and level of participation by the Holders in the Solicitation and other factors listed in the Consent Solicitation Statement under "Forward-Looking Statements." Except as required by law, Itabo undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change.  Do not place undue reliance on forward-looking information.

SOURCE Empresa Generadora de Electricidad Itabo, S.A.