Skyfame enters restructuring support agreement for three groups of debt

By Marisa Wong

Los Angeles, Sept. 29 – Skyfame Realty (Holdings) Ltd.’s board of directors announced that on Sept. 29, Skyfame, Skyfame International Holdings Ltd., Rich Apex Ltd. and Waymax Investments Ltd. entered into a restructuring support agreement with some creditors and information agent D.F. King.

The parties have agreed to, among other things, support and facilitate the proposed restructuring of Skyfame’s existing debt and the proposed Bermuda and Hong Kong schemes.

Debt categories

The main terms of the term sheet set out in the RSA include outlining the three categories of existing debt to be covered under the proposed schemes:

• Category 1: $247 million 13% secured senior notes due July 8, 2022 (ISIN: XS2022224047) issued by Skyfame;

• Category 2: unsecured debt, including $292 million 13% unsecured senior notes due Dec. 16, 2023 (ISIN: XS2272702338) issued by Skyfame International and guaranteed by Skyfame; 7%, 8% and 12½% step-up coupon senior unsecured bonds issued by Skyfame due on various dates in 2023 and 2024; $20 million 14½% senior guaranteed bonds issued by Rich Apex and guaranteed by Skyfame due on various dates in December 2022 and January 2023; the unsecured portion, if any, of certain secured debt of the loan between a license bank in Hong Kong as the lender and Waymax as the borrower; and trade debt, comprising certain U.S. dollar-denominated and Hong Kong dollar-denominated non-recurring trade payables; and

• Category 3: medium-term bonds.

Scheme creditor consideration

Under the term sheet, scheme creditors’ claims will be the sum of

• The outstanding principal amount of the category 1 existing debt and the category 2 existing debt held by the scheme creditors as of the record time;

• The carrying amount of the medium-term bonds held by the scheme creditors as of the record time; and

• All accrued and unpaid interest on that existing debt up to but excluding the restructuring effective date.

On and from the restructuring effective date, upon (i) issuance of the scheme notes and (ii) the successful amendments to each series of Skyfame’s medium-term bonds, the relevant scheme creditors will fully release all claims against each relevant issuer and other obligors, in exchange for (a) the scheme consideration in accordance with the terms of the scheme documents and (b) each relevant issuer agreeing to fully release all claims against the relevant scheme creditors in connection with the existing debt.

The scheme notes are the senior notes due 2029 to be issued under the proposed schemes and U.S. dollar- and Hong Kong dollar-denominated senior notes due 2030 to be issued under the proposed schemes.

The scheme consideration for each category 1 scheme creditor will be the 2029 scheme notes in an aggregate principal amount equal to the scheme creditors’ claims of that category 1 scheme creditor.

The scheme consideration for each category 2 scheme creditor will be:

• For each scheme creditor holding U.S. dollar-denominated category 2 debt, the scheme consideration will be the U.S. dollar-denominated 2030 scheme notes in an aggregate principal amount equal to the scheme creditors’ claims of that USD category 2 scheme creditor; and

• For each scheme creditor holding Hong Kong dollar-denominated category 2 debt, the heme consideration will be the Hong Kong dollar-denominated 2030 scheme notes in an aggregate principal amount equal to the scheme creditors’ claims of that HKD category 2 scheme creditor.

The scheme consideration for each scheme creditor holding category 3 debt will be the amended medium-term bonds in an aggregate carrying amount equal to the scheme creditors’ claims of that category 3 scheme creditor.

Restructuring effective date

The restructuring effective date will be the day on which all outstanding existing debt will be canceled and all guarantees in connection with the existing debt will be released and the scheme consideration will be distributed to the scheme creditors, with the conditions precedent to the restructuring effective date having been either satisfied or waived on or prior to the restructuring effective date.

From the date of the RSA to the restructuring effective date, there is a moratorium on claims.

Early repayment

The scheme notes and amended medium-term bonds may be repaid, redeemed, settled or offset prior to their respective maturity dates through any or all of the following: debt-to-equity swap, specified assets disposal, SPV debt-to-equity swap and/or liquidated specified assets disposal.

Other details

The company is offering a consent fee to creditors that accede to the RSA by 5 a.m. ET on Nov. 8.

The information agent can be contacted at Skyfame@dfkingltd.com, +852 5803 1716 or +44 20 4578 1565.

Skyfame is a Hong Kong-based property development investment holding company.

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