Dublin (pta001/20.04.2022/00:45) - THIS NOTICE IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
THIS NOTICE CONTAINS IMPORTANT INFORMATION OF INTEREST TO THE OWNERS OF THE NOTES. IF APPLICABLE, ALL DEPOSITARIES, CUSTODIANS AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUESTED TO PASS THIS NOTICE TO SUCH OWNERS IN A TIMELY MANNER.
If you are in any doubt as to the action you should take, you are recommended to seek your own financial, legal or other advice immediately from your stockbroker, bank manager, solicitor, accountant or other appropriately authorised independent financial adviser.
If you have recently sold or otherwise transferred your entire holding(s) of the Notes referred to below, you should immediately forward this document to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.
NOTICE FROM THE ISSUER TO NOTEHOLDERS HFMX Designated Activity Company (the "Issuer")
Costamare (Series 231) Notes due 2020
ISIN: XS1887321518 COMMON CODE: 188732151
(the "Notes" or the "Series" and the holders thereof the "Noteholders")
Capitalised terms used but not otherwise defined in this notice shall have the meanings ascribed to them in the Series Memorandum dated 3 October 2018 as supplemented on 24 April 2020 and the Conditions of the Notes as the same may be amended and / or supplemented from time to time.
The Issuer used the entire net proceeds of the Notes make a loan (the "Loan") to Boulevard Costa Sur S.A. (the "Borrower").
The Notes originally had a Maturity Date of 2 October 2020. Pursuant to an Extraordinary Resolution of the Noteholders dated 8 April 2020, the Noteholders approved an extended maturity date of 30 April 2021 ("First Extended Maturity Date"); and pursuant to an Extraordinary Resolution of the Noteholders dated 29 June 2021, the Noteholders approved an extended maturity date of 15 April 2022 ("Second Extended Maturity Date").
Special Condition 5.3 (Redemption Amount) provides that, unless previously redeemed or purchased, the Notes will be redeemed by a payment in respect of each Note of the Redemption Amount on the Final Maturity Payment Date save where Notes are redeemed pursuant to Condition 2.4.6. The Redemption Amount is defined as an amount equal to the greater of (i) zero and (ii) the Net Proceeds. The Special Condition also provides that no interest or other amount shall accrue or be payable in respect of the Notes in respect of the period from and including the Extended Maturity Date, to and including the Final Maturity Payment Date.
The calculation of the Net Proceeds is dependent on the determination of the Realisable Value. The Realisable Value is defined as an amount determined by the Calculation Agent being the proceeds of sale or other means of realisation of the Charged Assets less any costs, expenses, taxes and duties incurred in connection with the disposal or transfer of the Charged Assets by the Charged Assets Realisation Agent.
Subject to the Conditions, the Final Maturity Payment Date is defined as the date falling five (5) Business Days following the day that the Issuer receives the aggregate Realisable Value pursuant to Special Condition 5.3 (Redemption Amount). It is also stipulated that the Final Maturity Payment Date may be significantly later than the Extended Maturity Date (as was disclosed in the "Risk Factors – Payments" in the Series Memorandum). Special Condition 5.11 (Events of Default) provides that an Event of Default under Condition 4.1.1 shall occur if the Final Maturity Payment Date does not occur within 90 days of the Maturity Date or Extended Maturity Date, as applicable.
Pursuant to the Secured Term Loan Agreement, as amended and restated on 15 July 2021, the Borrower became obliged to repay the entire unpaid Loan principal and all accrued and unpaid interest thereon on 31 March 2022 (the "Loan Maturity Date"). In connection with the foregoing, on 21 March 2022, the Borrower served written notice (the "Borrower Notice" attached hereto as Appendix I) on the Issuer informing it that the Borrower will not be able to fulfill its obligation to pay in full accrued but unpaid interest and outstanding principal under the Secured Term Loan Agreement on the Loan Maturity Date (being the same date as the Second Extended Maturity Date) and that its operations and commercial efforts continue to be negatively affected as a result of the COVID-19 pandemic. The Borrower Notice further provides that: (i) the Borrower is in ongoing negotiations with potential third parties with the objective of securing financing for partial, or complete, refinancing of the Loan; and (ii) if successful, the negotiations would provide funds for a partial, or complete, payment of the Borrower's obligations under the Secured Term Loan Agreement. However, the Borrower Notice also provides that the success of such negotiations is not guaranteed and that even if successful, the procurement of funds allowing the Borrower to meet its payment obligations under the Loan may exceed the 30 day Cure Period with respect to the Loan Payment Failure (as defined below). Accordingly, the Borrower would be required to consult with Noteholders for a new extension of the Loan and /or modifications to the Secured Term Loan Agreement.
The Cure Period under Section 5.02 of the Loan commences from the earlier of (i) the Lender notifying the Borrower of the relevant breach (in this case the Loan Payment failure, as defined below) and (ii) the Borrower acquiring knowledge of said breach. The Borrower Notice evidences the Borrower's knowledge of the relevant breach and so the Cure Period commenced on the date that the Loan Payment Failure, as defined below, occurred.
The Issuer hereby gives notice to the Noteholders that the Borrower failed to make the scheduled payment of the entire principal amount outstanding under the Loan, together with accrued but unpaid interest, due on 31 March 2022 (the "Loan Payment Failure").
The Issuer hereby provides notice that:
1. The Notes will mature on the Second Extended Maturity Date of 15 April 2022.
2. The provisions of Special Condition 5.3 (Redemption Amount) apply so that the Redemption Amount of the Notes will be paid on the Final Maturity Payment Date, which may be significantly later than the Second Extended Maturity Date. However, if the Final Maturity Payment Date does not occur within 90 days of the Second Extended Maturity Date, it will be an Event of Default of the Notes.
3. As a result of the Borrower Notice, the Arranger will coordinate with the Issuer and Borrower, in respect of the preparation of an Extraordinary Resolution of the Noteholders to extend the term of the Loan and the Notes.
This Notice has not been formulated by the Trustee who expresses no view on it and the Trustee expresses no opinion as to the actions (if any) the Noteholders may take in respect of this Notice. The information contained herein has not been independently verified by the Trustee and the Trustee makes no representation that all relevant information has been disclosed to Noteholders in or pursuant to this Notice. In accordance with normal practice, the Trustee expresses no view as to the truth, veracity, accuracy or completeness of the contents of this Notice. Accordingly, the Trustee recommends that Noteholders consider seeking their own financial, tax, accounting, investment and legal advice in respect of this Notice.
No responsibility or liability is or will be accepted by the Trustee in relation to the accuracy or completeness of this Notice or any other written or oral information made available to any person receiving this Notice or its advisers and any such liability is expressly disclaimed. This Notice is made without prejudice to any and all of the Trustee's rights under the Conditions of the Notes and the transaction documents relating to the Notes, all of which are expressly reserved.
Other than as disclosed above, the Issuer proposes no further course of action at this time. This notice is for informational purposes only.
For further information with regards to your investment in the Notes, please contact the Issuer at: IEfirstname.lastname@example.org.(end)