Corral Petroleum Holdings AB (publ) Business Update ... - Preem

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(v)for the financial year ending December 31, 2015, SEK 894 million.Any unutilized balance of permitted capital expenditure in any financial year may be carried forward for onefinancial year only.The New Credit Facility also contains other restrictions and prohibitions that prevent Preem from making anydistribution, or declaring or paying any dividend other than as described below.In addition, the New Credit Facility also requires Preem to provide a hedging policy with respect to the price risk inits inventory norm position by the later of 30 days following the Closing Date and 30 September 2011. Such policy must beimplemented by Preem by no later than 28 February 2012.Restrictions on Upstreaming of CashPreem may not make any distribution or declare or pay any dividend whatsoever unless permitted pursuant to theterms of the New Credit Facility.At any time, Preem is permitted to make group tax contributions (Sw: Koncernbidrag) to the Issuer by way ofdividend, provided that such amount is funded by way of equity contribution or a subordinated loan and that it is effected byaccounting entries only and not by movement of cash. Preem is also permitted to pay administrative costs of the Issuer up toa maximum amount of $500,000 in any calendar year.At any time following payment of all arrangement fees under the New Credit Facility, subject to minimum liquidityrequirements of $100 million and provided that no event of default is outstanding under the New Credit Facility, Preem ispermitted to make a distribution, dividend or payment to Corral Petroleum Holdings to allow for the payment of cash-payinterest on any new notes issued in a refinancing up to a maximum of 4% per annum.At any time following payment of all arrangement fees under the New Credit Facility, subject to minimum liquidityrequirements of $200 million and provided that (i) the term loan facility has been repaid in full (ii) all fees due under the NewCredit Facility have been paid (iii) the Total Net Debt (as defined in the New Credit Facility) to consolidated EBITDA ratiohas been equal or below 4.0x for two successive quarters and would not be breached on a pro forma last twelve months basisafter making the payment and (iv) no event of default is outstanding, Preem is permitted to make a distribution, dividend orpayment to the Issuer for any purpose.The aggregate of dividends, payments or other distributions out of Preem to the Issuer from the Closing Date to thematurity date of the New Credit Facility (other than with respect to group tax contributions) shall not exceed 100% of the netincome of Preem arising after the Closing Date.Requirement to Prepay New Credit FacilityIn addition to mandatory prepayment upon a change of control, sale of assets, receipt of insurance proceeds orillegality, which are typical provisions in an agreement of this nature, subject to minimum liquidity requirements of $200million (after making the payment) and for so long as amounts remain outstanding under the term loan facility, Preem mustprepay credits under the New Credit Facility with a certain percentage of its excess cash flow for each financial year asfollows: (i) 100% until $90 million has been applied in prepayment of the facilities pursuant to the cash sweep provisions; (ii)75% until an amount no greater than $400 million is outstanding under the term loan facility and (iii) 50% at any timethereafter. Preem is also required to prepay credits under the New Credit Facility, in order to remedy any breach of certainborrowing base limitations.Events of DefaultThe New Credit Facility contains various standard events of default (subject to customary materiality thresholds andin certain cases, remedy periods), including, without limitation, for non-payment, for any breach of the financial or othercovenants, misrepresentation, nationalization, material litigation, cross default to other indebtedness and any amendments toany new notes issued in a refinancing such that they would fail to comply with certain agreed parameters as well as upon anychange of control of Preem, the Issuer or its parent company Moroncha Holdings Limited.SecurityThe New Credit Facility will be secured by the following security package:(i)(ii)a pledge granted by the Issuer in respect of the shares in Preem;a pledge in respect of Preem’s receivables arising from goods and services supplied by Preem in the58
ordinary course of its business;(iii)(iv)an English law security agreement in respect of Preem’s receivables arising from goods and servicessupplied by Preem and which Preem at any time may have against or which may be due to Preem from anyGerman debtor;a mortgage agreement pursuant to which Preem grants a business mortgage (Sw: företagshypotek) overPreem’s business, evidenced by first ranking mortgage certificates (Sw: företagsinteckningar) in an amountof SEK 8,000,000,000;(v) a mortgage agreement pursuant to which Preem grants a real estate mortgage (Sw: fastighetspant) over thereal estate properties on which Preem’s refinery premises in Gothenburg are located, evidenced by first rankingmortgage certificates (Sw: pantbrev) in the properties Göteborg Syrhåla 2:1 and 2:2 in an aggregate amount ofSEK 1,000,000,000;(vi)a mortgage agreement pursuant to which Preem grants a real estate mortgage (Sw: fastighetspant) over thereal estate properties on which Preem’s refinery premises in Lysekil are located, evidenced by first rankingmortgage certificates (Sw: pantbrev) in the property Lysekil Sjöbol 2:5 in an amount ofSEK 3,000,000,000;(vi)(vii)a pledge or assignment of Preem’s insurance proceeds; anda pledge in respect of Preem’s bills of lading physically delivered to the Agent.59
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Corral Petroleum Holdings AB (publ)
Page 4 and 5:
RISK FACTORSThis Business Update al
Page 6 and 7:
the availability and worldwide inve
Page 8 and 9: on greenhouse gas emissions. Withou
Page 10 and 11: foreign currency risk. We engage in
Page 12 and 13: SELECTED CONSOLIDATED FINANCIAL DAT
Page 14 and 15: MANAGEMENT’S DISCUSSION AND ANALY
Page 16 and 17: changes in technology; andthe impac
Page 18 and 19: goods sold.Indebtedness. As of June
Page 20 and 21: Results of OperationsSummaryThe fol
Page 22 and 23: Income taxes. Income taxes for the
Page 24 and 25: Operating income. Operating income
Page 26 and 27: Cash flow from operating activities
Page 28 and 29: the 2008 Credit Facility with proce
Page 30 and 31: priced, but not delivered. When the
Page 32 and 33: The table below presents, as of Dec
Page 34 and 35: TotalValue (1)% ofTotalLong-TermDeb
Page 36 and 37: June 30, 2010 and SEK 9,299 million
Page 38 and 39: ended June 30, 2011 and 2010, respe
Page 40 and 41: performance of the refinery. This i
Page 42 and 43: us to produce biofuel diesel.After
Page 44 and 45: have used and will seek to use deri
Page 46 and 47: CompetitionOur supply and refining
Page 48 and 49: MANAGEMENTThe following tables set
Page 50 and 51: Magnus Heimburg has been Executive
Page 52 and 53: OWNERSHIP OF COMMON STOCKCorral Pet
Page 54 and 55: Mohammed H Al Amoudi, the Chairman
Page 56 and 57: StructureThe New Credit Facility pr
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Corral Petroleum Holdings AB (publ) Business Update ... - Preem

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