BG Energy Capital plc (the “Issuer”) announces separate invitations (each such invitation, a “Consent Solicitation”) to eligible holders of each series of its outstanding notes described in the table below (each a “Series”, and together the “Notes”), to consent to, among other things, certain modifications to the terms and conditions (the “Conditions”) of, and the trust deed (the “Trust Deed”) and the agency agreement (the “Agency Agreement”) for, the relevant Series to provide for (i) the substitution of Shell plc (“Shell”) in place of the Existing Guarantor (as defined below) as guarantor in respect of the relevant Series; (ii) the appointment of Deutsche Trustee Company Limited (the “Successor Trustee”) as successor trustee in respect of the relevant Series; (iii) the alignment of certain provisions of the Trust Deed for, and the Conditions of, the relevant Series with the equivalent provisions included in the documentation relating to debt securities issued under Shell’s current multi-currency debt securities programme; and (iv) certain consequential modifications to the applicable Trust Deed, the applicable Agency Agreement and the applicable global bearer note for the relevant Series in relation to items (i) to (iii) above.
This announcement does not contain the full terms and conditions of the Consent Solicitations, which are contained in the Consent Solicitation Memorandum dated 28 November 2022 (the “Consent Solicitation Memorandum”) prepared by the Issuer, and this announcement should be read in conjunction with the Consent Solicitation Memorandum. Capitalised terms used but not otherwise defined in this announcement have the meanings given in the Consent Solicitation Memorandum.
Subject to the restrictions described under “Solicitation and Distribution Restrictions” below, Eligible Noteholders (as defined below) may obtain a copy of the Consent Solicitation Memorandum from the Tabulation Agent, the contact details for which are set out below. In order to receive a copy of the Consent Solicitation Memorandum, a holder of any Notes will be required to provide confirmation as to his or her status as an Eligible Noteholder. Eligible Noteholders are advised to read carefully the Consent Solicitation Memorandum.
Background to, and rationale for, the Consent Solicitations
In the first quarter of 2016, Shell completed the acquisition of BG Group plc (the “Acquisition”). The Issuer and BG Energy Holdings Limited, the existing guarantor of the Notes (the “Existing Guarantor), were wholly owned, indirect subsidiaries of BG Group plc, and following the Acquisition the Issuer and the Existing Guarantor became wholly owned subsidiaries of Shell.
Pursuant to the Consent Solicitations, the Issuer, the Existing Guarantor and Shell are seeking to substitute Shell in place of the Existing Guarantor as guarantor in respect of each Series of the Notes, and to simplify Shell’s funding structure by aligning certain provisions in the Conditions and the Trust Deed of each Series of Notes with the equivalent provisions included in the documentation relating to debt securities issued under the current multi-currency debt securities programme of Shell and Shell International Finance B.V. (“Shell’s Programme”).
In addition, the Existing Trustee has given notice to the Issuer and the Existing Guarantor pursuant to the relevant Trust Deed of its intention to retire as Trustee for the holders of each Series of the Notes. Accordingly, pursuant to the Consent Solicitations, the Issuer is also seeking the Noteholders’ approval of the appointment of the Successor Trustee as successor trustee in respect of each Series of the Notes.
The Issuer and the Existing Guarantor are convening separate meetings to be held via teleconference (the “Meetings”) of the holders of each Series (together the “Noteholders”) for the approval by Eligible Noteholders of such Series, by a separate extraordinary resolution (each an “Extraordinary Resolution”) of such Series, of the Proposed Amendments (as defined below), as further set out in the notice convening the Meetings published by the Issuer and the Existing Guarantor on the date of this announcement (the “Notice”).
The purpose of each Consent Solicitation is to invite Eligible Noteholders of each Series to consider and, if thought fit, pass a separate Extraordinary Resolution of the relevant Series which will, among other things, approve modifications to the Conditions, the Trust Deed and the Agency Agreement relating to the relevant Series to provide for:
(a) the substitution of Shell in place of the Existing Guarantor as guarantor in respect of the relevant Series;
(b) the appointment of the Successor Trustee as successor trustee in respect of the relevant Series, in place of, and following the notice of resignation of, Royal Bank of Canada Trust Corporation Limited (the “Existing Trustee”) as existing trustee in respect of the relevant Series;
(c) the amendment of the following provisions of the Conditions to align such provisions with the equivalent provisions included in the terms and conditions of debt securities issued under Shell’s Programme:
(i) the deletion of, in the case of the 2036 Notes, Condition 4 (Negative Pledge) or, in the case of each other Series, Condition 5 (Negative Pledge); and
(ii) the alignment of the events of default in, in the case of the 2036 Notes, Condition 12 (Events of Default) or, in the case of each other Series, Condition 13 (Events of Default), with the events of default under Shell’s Programme;
(d) certain amendments to the covenants in Clause 7 of the applicable Trust Deed, including:
(i) an amendment to Clause 7.1.4 such that the current requirement that the Issuer and the Guarantor send to the Trustee copies of “every balance sheet, profit and loss account, report, circular and notice of general meeting and every other document issued or sent to its shareholders together with any of the foregoing (in the case of the Guarantor, the contents of which are material to the interests of the Noteholders)” instead refers to “its external shareholders (excluding the Guarantor or any of the Guarantor’s Subsidiaries)”;
(ii) an amendment to Clause 7.1.5 such that the current requirement that the Issuer and the Guarantor notify the Trustee “of the coming into existence of any security interest which would require any security to be given to any Series of the Notes pursuant to Condition 5 (Negative Pledge)” be deleted (on the basis that the negative pledge provision will no longer be included in the applicable Conditions); and
(iii) the deletion of Clauses 7.1.20 and 7.1.21, which require that the Guarantor give the Trustee periodic certificates listing, or notifying the Trustee of changes to, the Guarantor’s current ‘Material Subsidiaries’, ‘Project Finance Companies’ and ‘Wholly Owned Subsidiaries’ (on the basis that such terms will no longer otherwise be used in the applicable Conditions or the applicable Trust Deed), and the provision of a waiver of any technical historic breaches of such requirements by the Existing Guarantor (and of any potential consequences arising from any such historic breach); and
(e) certain consequential modifications to the applicable Trust Deed, the applicable Agency Agreement and the applicable global bearer note currently representing the relevant Series arising from the foregoing, (together the “Proposed Amendments”).
Each Consent Solicitation commences on the date of the Consent Solicitation Memorandum and expires at 4.00 p.m. (London time) on 15 December 2022 (such time and date with respect to each Series, as the same may be extended, the “Expiration Deadline”). All Consent Instructions from Eligible Noteholders wishing to vote in respect of the relevant Extraordinary Resolution must be received by the Tabulation Agent by the Expiration Deadline.
Further information in relation to the Consent Solicitations, including the Proposed Amendments and the manner in which the Proposed Amendments will be implemented, and the procedures for participating in the Consent Solicitations and at the Meetings, is set out in the Consent Solicitation Memorandum.
No consent or participation fee will be payable in connection with the Consent Solicitations.
The Consent Solicitations are only being made, and the Consent Solicitation Memorandum and any other documents or materials relating to the Consent Solicitations are only for distribution or to be made available, to each Noteholder who is (a) located and resident outside the United States and not a U.S. person (as defined in Regulation S under the Securities Act), (b) not a retail investor (as defined below) and, if applicable and acting on a non-discretionary basis, who is acting on behalf of a beneficial owner that is not a retail investor, and (c) otherwise a person to whom the relevant Consent Solicitation can be lawfully made and that may lawfully participate in the relevant Consent Solicitation (each an “Eligible Noteholder”).
For these purposes, a “retail investor” means a person who is one (or more) of: (i) a retail client, as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended (the “EUWA”), or (ii) a customer within the meaning of the provisions of the Financial Services and Markets Act 2000 (as amended, the “FSMA”) and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of United Kingdom domestic law by virtue of the EUWA.
At each Meeting, Noteholders will be invited to consider and, if thought fit, vote in favour of the Extraordinary Resolution relating to the relevant Series, as more fully described in the Consent Solicitation Memorandum and the Notice.
The implementation of each Consent Solicitation and the related Extraordinary Resolution will be conditional on:
(a) the passing of the relevant Extraordinary Resolution;
(b) the Issuer not having previously terminated the relevant Consent Solicitation in accordance with the provisions for such termination set out in the Consent Solicitation Memorandum;
(c) the quorum required for, and the requisite majority of votes cast at, the relevant Meeting being satisfied by Eligible Noteholders, irrespective of any participation at the relevant Meeting by Ineligible Noteholders (and would also have been so satisfied if any Ineligible Noteholders who provide confirmation only of their status as Ineligible Noteholders and waive their right to attend (via teleconference) and vote (or be represented (via teleconference)) at the relevant Meeting had actually participated at such Meeting), including, if applicable, the satisfaction of such condition at an adjourned Meeting as described in the Consent Solicitation Memorandum (the “Eligibility Condition”); and
(d) the passing of the relevant Extraordinary Resolution for each other Series and the Issuer not having previously terminated the Consent Solicitation relating to each such other Series in accordance with the provisions for such termination set out in the Consent Solicitation Memorandum (the “Resolution Inter-conditionality”), (together, the “Consent Conditions”).
Although the Resolution Inter-conditionality contemplates that any Extraordinary Resolution passed at the relevant Meeting will not be implemented if (i) the relevant Extraordinary Resolution in respect of each other Series is not also passed and/or (ii) the Issuer has terminated the Consent Solicitation relating to any such other Series, the Issuer reserves the right, in its sole discretion, to waive the Resolution Inter-conditionality in relation to any Series and (if the other Consent Conditions relating to such Series are satisfied) to implement the relevant Extraordinary Resolution.