REC to issue new convertible bond loan and offe...

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES

Sandvika, August 12, 2013:  Renewable Energy Company ASA (the "Company" or "REC ASA") proposes to improve its debt maturity profile through issuing a new convertible bond loan maturing in 2018, offer partial repurchase and exchange of the existing 2014 convertible bond as well as offer partial repurchase of the 2014, 2016 and 2018 bond loans.

REC ASA has mandated Arctic Securities ASA (the "Manager") to explore the potential issuance of up to USD 110 million (NOK 643 million) in principal amount of convertible bonds (the "New Convertible Bond Loan") with maturity on September 13, 2018.

In conjunction with the issue of the New Convertible Bond Loan, REC ASA will offer to repurchase and exchange bonds in the Company's Subordinated Unsecured Convertible Bond Issue 2009/2014 (the "Existing Convertible Bond Loan") for a principal amount of up to EUR 112 million (NOK 876 million), including accrued interest since the July 4, 2013 interest payment date (the "CB Repurchase and Exchange Offer").

Separately, REC ASA intends to launch voluntary offers for partial repurchase of the Company's bond loans REC01 maturing in 2014, REC02 maturing in 2016, and REC03 maturing in 2018, (jointly the "Bonds") which will be launched on the condition that the offering in REC Solar ASA is completed as outlined in the proposal announced on July 18, 2013 (the "Conditional Bond Repurchase Offers").

Following completion of the proposed equity offering in REC Solar ASA of NOK 800 million, the issue of the New Convertible Bond Loan, the CB Repurchase and Exchange Offer and the Conditional Bond Repurchase Offers, REC ASA will improve its debt maturity profile, with pro-forma Q2 2013 cash exceeding 2014 repayments, and reduce interest cost considerably. Holders of the Existing Convertible Bond Loan are offered partial redemption combined with equity exposure in REC ASA through a significant reduced strike price whilst holders of the Bonds will be offered a substantial redemption.

A brief presentation summarizing the New Convertible Bond Loan, CB Repurchase and Exchange Offer and Bond Repurchase Offers has been included as an attachment to this release

The CB Repurchase and Exchange Offer is independent of the Bond Repurchase Offers. Hence, the CB Repurchase and Exchange Offer is neither dependent on the acceptance by senior bondholders and completion of the Bond Repurchase Offers nor the completion of the contemplated separation of the Company's Silicon and Solar divisions as described in the Company's press release on July 18, 2013.

New Convertible Bond Loan
The status of the New Convertible Bond Loan will be Senior Unsecured, and rank pari passu with other Senior Unsecured debt in the company. The strike price will be NOK 3.60, representing a premium of around 24 percent to the spot price of NOK 2.91 on August 9, 2013.

The New Convertible Bond Loan will be denominated in USD and have quarterly coupon payments of 6.5% p.a.

In case of oversubscription of the New Convertible Bond Loan, holders of the Existing Convertible Bond Loan tendering in the CB Repurchase and Exchange Offer will receive preferred allocation in the Convertible Bond Issue in accordance with the amount being issued through the CB Repurchase and Exchange Offer. Allocation criteria for the remaining amount of the New Convertible Bond Loan will be based on, inter alia, timeliness of the order and investor quality. Subscription is possible for investors who currently are not holders of the Convertible Bond Loan. The minimum subscription amount is USD 200,000.

For additional details please refer to the term sheet for the New Convertible Bond Loan available at Arctic Securities Fixed Income (see below for contact details).

CB Repurchase and Exchange Offer
Each bond unit under the Existing Convertible Bond Loan has a nominal value of EUR 50,000 (each such bond a "Convertible Bond Unit") and the minimum application for convertible bondholders who wish to tender their Convertible Bond Units under the CB Repurchase and Exchange Offer is 5 Convertible Bond Units, which equals a minimum application amount of EUR 250,000.

The CB Repurchase and Exchange Offer for a principal amount of up to EUR 112 million (NOK 876 million) will be settled through a combined cash and exchange settlement at the following allocation and settlement terms:

(i)        Approximately 30 percent of the CB Repurchase and Exchange Offer will be settled in cash to the accepting Convertible Bondholders, which equals a cash settlement of up to approximately NOK 263 million;

(ii)       Approximately 70 percent of the CB Repurchase and Exchange Offer will be settled through subscription in the New Convertible Bond Loan.

The above figures are based on a EUR:NOK exchange rate of 7.82, and a USD:NOK exchange rate of 5.85 as of August 9, 2013, which will be the fixed rate for the CB Repurchase and Exchange Offer.

The acceptance period for the CB Repurchase and Exchange Offer and the Convertible Bond Issue commences at 09:00 CET on August 12, 2013 and expires at 16:30 CET on August 15, 2013, unless the acceptance period is extended, amended or terminated earlier at the sole discretion of the Manager. If the acceptance period is shortened or extended, the other dates referred to herein may be amended accordingly.

In case of oversubscription of the CB Repurchase and Exchange Offer, allocation will be made on a pro-rata basis.

Timeline for the Convertible Bond Issue and the CB Repurchase and Exchange Offer
The result of the CB Repurchase and Exchange Offer and the issue of the New Convertible Bond Loan will be announced no later than 09.00 am CET on August 16, 2013. The completion of the CB Repurchase and Exchange Offer and the New Convertible Bond Loan is conditional upon approval by an extraordinary general meeting which is expected on or about September 6, 2013. A voting undertaking has been signed by the Company's largest shareholder, UMOE AS (representing 15.5% of the shares), and companies controlled by the board members Øystein Stray Spetalen (2.9%) and Jan Christian Opsahl (0.6%). In addition, certain other shareholders, representing 11.9% of the Company, have signed the voting undertaking. The settlement date for the CB Repurchase and Exchange Offer is expected on or about September 13, 2013.

Subject to applicable law and as provided in the CB Repurchase and Exchange Offer and the issue of the New Convertible Bond Loan, the Company may, at its sole discretion, extend, re-open, amend, waive any condition of or terminate the CB Repurchase and Exchange Offer and the issue of the New Convertible Bond Loan at any time. Details of any such changes will be announced as soon as reasonably practicable. The Company will have no obligation to repurchase tendered Convertible Bond Units until the Company communicates an unconditional completion notice through the Oslo Stock Exchange.

Investors who wish more information about the New Convertible Bond Issue and bondholders who wish more information or wish to accept the CB Repurchase and Exchange Offer should contact:

Arctic Securities Fixed Income Sales at [phone]

The Conditional Bond Repurchase Offers
The Bond Repurchase Offers will be settled at the following allocation and settlement terms on the condition that the offering in REC Solar ASA is completed as outlined in the proposal announced on July 18, 2013:

(i)        REC01: Redemption of up to approximately NOK 390 million (equivalent to approximately 60% of the principal value of REC01), corresponding to a cash payment of approximately NOK 402 million (equivalent to 103% of par)
(ii)        REC02: Cash payment of up to approximately NOK 285 million at par (equivalent to approximately 40% of the principal value of REC02);
(iii)       REC03: Cash payment of up to approximately NOK 365 million at par (equivalent to approximately 40% of the principal value of REC03).

The minimum application and allocation for each of the Conditional Bond Repurchase Offers will be in the amount of NOK 500,000 (principal value).

In case of oversubscription, allocation will be made on a pro-rata basis. The acceptance period for the Bond Repurchase Offers will be for up to 3 trading days and commence no later than 5 trading days following the first trading day of REC Solar ASA. The settlement date for the Bond Repurchase Offer will be shortly after announcement of the results of the Bond Repurchase Offers.

As described in the REC ASA's press release on July 18, 2013, the completion of the contemplated separation of the Company's Silicon and Solar divisions is conditional upon approvals by (i) the extraordinary general meeting of the Company and (ii) the bondholders' meetings in REC01, REC02 and REC03.

Summons to bondholders' meetings in the REC01, REC02 and REC03 bonds is expected to be distributed on or about August 14, 2013.

For further information, please contact:

Mikkel Tørud,
SVP Investor Relations & Business Development, REC
Telephone: [phone]
Email: [e-mail]

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This press release does not constitute or form part of an offer or solicitation to sell, purchase or subscribe for securities in the United States. The securities referred to herein may not be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended. The Company does not intend to register any portion of the offering of any securities in the United States or to conduct a public offering of any securities in the United States. Copies of this announcement are not being made and may not be distributed or sent into the Australia, Canada, Japan or the United States.

Certain statements contained herein that are not statements of historical fact, may constitute forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results or events concerning the Company to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. Although the Company has attempted to identify important factors that could cause actual events or results to differ from those described in forward-looking statements contained herein, there can be no assurance that the forward-looking statements will prove to be accurate as actual future events could differ materially from those anticipated in such statements. Except as may be required by applicable law or stock exchange regulation, the Company undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.  

About REC

REC is a leading global provider of solar electricity solutions. With nearly two decades of expertise, we offer sustainable, high-performing products, services and investment opportunities for the solar and electronics industries. Together with our partners, we create value by providing solutions that better meet the world's growing electricity needs. Our 2,200 employees worldwide generated revenues of more than NOK 7 billion in 2012, approximately EUR 1 billion or USD 1.3 billion.

To see more of what REC can offer, visit www.recgroup.com

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

Bond Refinancing Presentation

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Source: Renewable Energy Corporation ASA via Thomson Reuters ONE

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