New Zealand markets open in 1 hour 11 minutes
  • NZX 50

    13,333.43
    +221.23 (+1.69%)
     
  • NZD/USD

    0.7189
    -0.0031 (-0.43%)
     
  • ALL ORDS

    7,078.90
    -28.20 (-0.40%)
     
  • OIL

    51.98
    -1.15 (-2.16%)
     
  • GOLD

    1,855.50
    -10.40 (-0.56%)
     

Edmonton Regional Airports Authority Commences Bond Consent Solicitation Process

·6-min read

Edmonton Regional Airports Authority ("Edmonton Airports") announced today that it has commenced a process to amend and temporarily waive certain provisions under its trust indenture (the "Indenture") governing all outstanding series of its bonds (the "Bonds"). Edmonton Airports has called for a meeting (the "Meeting") of holders of all outstanding Bonds ("Bondholders") and has commenced the solicitation of consents and proxies in respect of the proposed amendments to the Indenture (the "Proposed Amendments").

The Proposed Amendments, which are described in detail in an information circular and consent solicitation statement (the "Circular") that will be delivered to Bondholders, will relieve Edmonton Airports of its obligations to meet or satisfy various debt service coverage ratio requirements in the Indenture and its obligations to fund an operating and maintenance contingency fund. Edmonton Airports, along with the rest of the global aviation industry, is facing a severe and abrupt drop in air traffic as a result of the COVID-19 pandemic and the travel restrictions imposed in many countries around the world. Though Edmonton Airports is forecasting a significant cash flow reduction in its upcoming fiscal years, Edmonton Airports expects to meet its payment obligations under the Bonds as they come due. Edmonton Airports is seeking the Proposed Amendments out of an abundance of caution. Significant cost-saving measures have been undertaken by Edmonton Airports to help mitigate the impacts of the COVID-19 pandemic. These measures include reductions in operating expenses including downsizing its workforce, deferring planned capital expenditures to later years, and reducing the terminal footprint. The Authority has also secured an expanded credit facility to provide additional liquidity to the organization.

To address public health measures arising from the impact of COVID-19 and to limit and mitigate risks to the health and safety of communities, the Meeting will be held in a teleconference-only format at 10:00 a.m. (Edmonton time) on December 22, 2020. The record date for determining Bondholders entitled to vote and consent is November 20, 2020. To be passed at the Meeting, the extraordinary resolution in respect of the Proposed Amendments (the "Resolution") must be approved by: (i) the affirmative vote of Bondholders representing at least 66⅔% of the principal amount of outstanding Bonds present or represented by proxy at the Meeting, voting together as a class (the "Class Approval") and the affirmative vote or written consent of Bondholders holding at least 66⅔% of the principal amount of all outstanding Bonds of each series of Bonds; or (ii) the written consent of Bondholders holding at least 66⅔% of the principal amount of all outstanding Bonds and the written consent of Bondholders holding at least 66⅔% of the principal amount of each series of Bonds (the "Series Approval"). The Indenture also provides that the Resolution, in respect of the Class Approval, may be passed by the written consent of Bondholders holding at least 66⅔% of the principal amount of all outstanding Bonds. If: (i) Bondholders, together as a class, representing not less than 66⅔% of the principal amount of all outstanding Bonds as of the Record Date; and (ii) Bondholders of each series, representing not less than 66⅔% of the principal amount of all outstanding Bonds of such series as of the Record Date, have delivered valid proxy and consent forms in favour of the Resolution by 10:00 a.m. (Edmonton time) on December 18, 2020 (the "Cut-Off Time") (and have not validly revoked such proxy and consent forms), the Resolution will be passed by the written consent of the Bondholders and the Meeting will be cancelled. As more fully set out in the Circular, holders of the Series A Bonds of Edmonton Airports (the "Series A Bonds") who submit a valid proxy and consent form prior to the Cut-Off Time or vote by proxy at the Meeting (if a Meeting is held at all) will receive a voting fee subject to certain conditions being satisfied.

The holder of the Series B Pledged Bonds of Edmonton Airports (the "Series B Pledged Bonds") has entered into a support agreement pursuant to which it has agreed, subject to the terms contained therein, to vote and consent in favour of the Proposed Amendments. The holder of the Series C Pledged Bonds of Edmonton Airports (the "Series C Pledged Bonds") has delivered a resolution, subject to the terms contained therein, approving the Proposed Amendments. Holders of the Series B Pledged Bonds and the Series C Pledged Bonds have waived, and will not receive, any voting fee.

During the applicable period in respect of which the Proposed Amendments are effective, Edmonton Airports also intends to, as part of its quarterly reporting to the Trustee (on behalf of Bondholders), notify the Trustee if Edmonton Airports’ borrowing availability under its operating and revolving credit facilities (excluding availability under its Alberta Capital Finance Authority credit facility 2, which is available for purposes of redeeming or purchasing for cancellation the Series A Bonds and the Series B Pledged Bonds) at the end of such fiscal quarter is below $70 million.

McCarthy Tétrault LLP is acting as legal advisor to Edmonton Airports. D.F. King Canada is acting as solicitation agent and Computershare Trust Company of Canada is acting as tabulation and paying agent in connection with the Meeting and consent solicitation. Bondholders are urged to carefully read the Circular and related materials for additional information with respect to the Proposed Amendments, as well as further instructions and deadlines.

About Edmonton International Airport
Edmonton International Airport ("EIA") is a self-funded, not-for-profit corporation whose mandate is to drive economic prosperity for the Edmonton Metropolitan Region. EIA is Canada’s fifth-busiest airport by passenger traffic and the largest major Canadian airport by land area. EIA offers non-stop connections to destinations across Canada, the US, Mexico, the Caribbean and Europe. EIA is a major economic driver, with an economic output of over $3.2 billion, supporting over 26,000 jobs. EIA’s Airport City propels new jobs, tourism and economic diversification – and creates a destination in and around EIA, featuring entertainment, e-commerce, retail, hospitality, cargo/logistics, biopharma, light manufacturing, and many other industries. EIA is focused on digital strategy to ensure it becomes the airport of the future.

Forward-Looking Information
This news release contains forward-looking information. Forward-looking information relates to statements concerning current expectations or beliefs and can be identified by words such as "may," "will," "should," "expect," "plan," "anticipate," "believe" and "intend". Although Edmonton Airports believes that the expectations and assumptions on which such forward-looking information are based are reasonable, undue reliance should not be placed on the forward-looking information because Edmonton Airports can give no assurance that they will prove to be correct. Forward-looking statements are subject to various risks and uncertainties which could cause actual results to differ materially from the anticipated results or expectations expressed in this news release. Bondholders are urged to carefully read the Circular for additional information with respect to forward-looking information, including the uncertainties and risk related there to.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201202005747/en/

Contacts

Contact for Bondholders
Bondholders who have questions or need assistance should contact D.F. King Canada by phone at 1-800-243-5194 (toll free North America) or 1-416-682-3825 (collect outside North America) or by email at inquiries@dfking.com.

Darrell Winwood
communications@flyeia.com