Results of Consent Solicitation
7 December 2009 - Evraz Group S.A. (LSE:EVR) ("Evraz" or the "Company") formally announces today that it has successfully concluded its consent solicitation ("Consent Solicitation") with respect to its 2013 Notes, 2015 Notes and 2018 Notes (the "Notes").
The Company launched the Consent Solicitation on 12 November 2009 to seek the consent of the holders of the Notes to amend the terms of certain covenants in the Notes (the "Proposals") as set out in a solicitation memorandum dated 12 November 2009 (the "Solicitation Memorandum").
At duly convened and quorate meetings of the holders of the Notes held today, the extraordinary resolutions proposed at such meetings, adopting the Proposals, were each duly passed.
The Proposals are briefly summarized as follows:
(a) in the case of the 2015 Notes to provide that the covenant requiring the Company to maintain a net debt to EBITDA ratio (as defined in the 2015 Notes) of 3:1 or lower shall not apply for the period when the ratio is required to be determined using consolidated financial statements of the Company for the measurement period ending 31 December 2009 and an amendment to such covenant such that the ratio is only tested at the end of each measurement period (on 30 June and 31 December of each year, commencing on 30 June 2010) and the ratio is changed to (i) 6.5:1 or lower for the measurement periods ending 30 June 2010 and 31 December 2010, (ii) 5.5:1 or lower for the measurement period ending 30 June 2011 and (iii) 3.5:1 or lower for the measurement periods ending 31 December 2011 and thereafter;
(b) in the case of the 2013 Notes, the 2015 Notes and 2018 Notes, insertion of customary exceptions to the covenant requiring the Company to not incur, and to not permit its subsidiaries to incur, Indebtedness (as defined in the Notes) other than where the leverage ratio is 3:1 or lower. The principal exceptions are:
(i) Inter-company Indebtedness incurred amongst the Company and its subsidiaries;
(ii) Indebtedness incurred to refinance certain permitted Indebtedness;
(iii) Indebtedness in an aggregate principal amount up to U.S.$75 million, provided that if an item of Indebtedness incurred pursuant to this section can subsequently be incurred within the 3:1 leverage ratio such Indebtedness shall be deemed not have been incurred under this exception; and
(iv) Indebtedness of an acquired person or in connection with an acquisition of assets (which Indebtedness was not incurred in contemplation of the acquisition) provided that after giving pro forma effect to such acquisition either (i) the Company would have been able to incur U.S.$1.00 of additional Indebtedness pursuant to leverage ratio or (ii) the leverage ratio is less than it was immediately prior to giving effect to such acquisition or other transaction;
(c) in the case of the 2015 Notes, excluding from the definition of Indebtedness such Indebtedness borrowed from a bank or trust company that cash collateralised in an amount substantially similar to the Indebtedness. This provision is already included in the 2013 Notes and the 2018 Notes.
The holders that voted in favour of the Proposals prior to the late instruction deadline, in accordance with the provisions of the Solicitation Memorandum, will be eligible to receive the applicable instruction fee by 11 December 2009, if they held notes via Euroclear or Clearstream, Luxembourg, or by 28 December 2009, if they held notes via DTC.
With respect to the Consent solicitation, J.P. Morgan Securities Ltd. have acted as Global Coordinator and Joint Solicitation Agent, Barclays Bank PLC, Deutsche Bank AG, London Branch, The Royal Bank of Scotland plc have each acted as Joint Solicitation Agents and The Bank of New York Mellon, London Branch has acted as Tabulation Agent. Lazard & Co., Limited have acted as financial adviser to the Company with respect to the Consent Solicitation.
For further information
VP, Public Relations
+7 985 122 4822
Director, Investor Relations
+7 495 232 1370
J.P. Morgan Securities Ltd., Barclays Bank PLC, Deutsche Bank AG, London Branch, The Royal Bank of Scotland plc, Lazard & Co., Limited and The Bank of New York Mellon, London Branch are acting exclusively for Evraz and no one else in connection with the Consent Solicitation. They will not regard any other person (whether or not a recipient of this announcement) as their respective clients and will not be responsible to anyone other than Evraz for providing the protections afforded to their respective clients nor for giving advice in relation to the Consent Solicitation, the contents of this announcement or any transaction or arrangement referred to herein.