Havila Ariel seeks holder consent to amend 2024 bonds, waive defaults

By Marisa Wong

Los Angeles, Dec. 21 – Havila Ariel AS is seeking to amend its NOK 400 million floating-rate senior secured bonds, issue 2021/2024 (ISIN: NO0011159485), according to a notice.

Bond trustee Nordic Trustee AS issued a summons on Thursday for a written bondholders’ resolution.

The issuer is seeking bondholder consent to a waiver of events of default. The issuer is also requesting that bondholders accept an amendment to the bond terms to improve the cash sweep mechanism. Lastly, the issuer wants bondholders to accept a parent loan as permitted financial support.

Background

Some events of default had occurred due to Havila Ariel’s failure to deliver the interim accounts for the quarter ended March 31, 2023, the annual financial statements for 2022 and compliance certificates for those periods within the deadlines required under the bond terms.

The issuer has subsequently delivered compliance certificates showing non-compliance with the interest cover ratio for the periods ending on March 31, 2023, June 30 and Sept. 30.

In addition, the issuer has informed the bond trustee that after those periods, it still does not satisfy the interest cover ratio, which constitutes an event of default.

To remedy this situation going forward, the issuer is proposing to include Havila Hotels AS wholly owned subsidiary Geiranger Fjord Hotels AS as a new group company, which will become an obligor, additional guarantor and security provider under the bonds.

According to pro forma calculations, if the new group company had been a group company for the period ended Sept. 30, the interest cover ratio for that period would have been 1.33x, which would have satisfied the bond terms.

Proposals

The issuer is asking bondholders to adopt the following proposals, subject to the effective date occurring before Dec. 29:

• Permanently waive the events of default from the date of the summons to the effective date set out in the amendment and restatement agreement for the bonds;

• Approve entry into the transactions set out in the amendment and restatement agreement;

• Authorize the bond trustee to extend the deadline for the effective date with up to five business days after Dec. 29; and

• Authorize the bond trustee to take all action necessary to give full effect to the proposals.

An informal ad hoc group of bondholders representing 50% of the bonds has indicated support for the proposals.

Written resolution

No bondholders’ meeting will be held with respect to the proposals.

The proposals will be passed if holders representing at least a two-thirds majority of the total number of voting bonds vote in favor of the proposals prior to the expiry of the voting period.

The voting period expires at 10 a.m. ET on Jan. 9.

Voting forms may be submitted to the bond trustee at mail@nordictrustee.com.

If no resolution is passed by the expiration time, the number of votes will be calculated at that time and a decision will be made based on the quorum and majority requirements set out under the bond terms.

Questions may be directed to the issuer (Vegard Saevik; +47 90 658 417; vegard@havila.no) or bond trustee (Jorgen Andersen; +47 90 843 033).

Havila Ariel is a Fosnavag, Norway-based real estate company that invests in larger commercial and office buildings.

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