Morgan & Morgan advised Banistmo, S.A. in connection with the public offering of senior secured notes for an amount of up to US$400 million issued through the ENA Master Trust
Panama, November 16, 2020. Morgan & Morgan acted as counsel to Banistmo, S.A., in connection with the issuance and placement of senior secured notes due 2048 with an interest rate of 4%, for an amount up to US$400,000,000.00, issued through the ENA Master Trust, a special trust vehicle created by Empresa Nacional de Autopistas, S.A. (ENA) to raise the funds to refinance certain obligations amongst others of ENA Sur, S.A. and ENA Este, S.A., both companies that owns the concession rights on toll roads knows as “Corredor Sur” and “Corredor Este”.
The notes were registered with the Superintendence of Markets of the Republic of Panama and listed in the Panama Stock Exchange and Luxembourg Stock Exchange, and placed in the United States of America under 144A/ Regulation S exemptions.
In this public offering, Banistmo, S.A. acted as trustee, to a special purpose trust created by Empresa Nacional de Autopista, S.A. (ENA), as settlor and servicer, and ENA Este, S.A., as settlor and ENA Sur, S.A., as settlors, known as “ENA Master Trust” that issued the bonds to raise the funds needed to refinance certain obligations amongst others of ENA Sur, S.A. and ENA Este, S.A., both companies that own concession rights on highways knows as “Corredor Sur” and “Corredor Este”.
To achieve this issuance, it was necessary to cover complex legal aspects of several jurisdictions, the modification of the existing terms of the bonds issued by ENA Sur Trust and ENA Este Trust, an early redemption of the notes issued by the ENA Sur Trust, among other aspects. The transaction at hand was a complex cross-border transaction covering aspect of several jurisdictions, which in addition required for the existing terms of the notes issued by the ENA Sur Trust and the ENA Este Trust to be amended as well as an early redemption of the notes issued by the ENA Sur Trust.
It is important to mention that we acted as wellMorgan & Morgan acted as well as counsel to Banistmo, S.A. for purposes of the relevant legal matters that arouse for the existing notes issued by the ENA Este Trust, in which Banistmo, S.A. is the trustee as well.
Partners Kharla Aizpurua Olmos, Inocencio Galindo, Ricardo Arias and Jose Carrizo, and senior associate Pablo Epifanio, participated in this transaction.
Morgan & Morgan advised Electron Investment, S.A. in the public offering of corporate bonds for a sum of up to US$ 205 million
Panama, July 15, 2020.
Morgan & Morgan represented Panamanian company Electron Investment, S.A. (the “Issuer”) in the public offering of corporate bonds for a sum of up to US$ 205,000,000 (the “Bonds”) in relation to Pando and Monte Lirio, two hydropower generating facilities that it owns and operates. For purposes of the public offering, Electron Investment, S.A. registered the Bonds with the Superintendence of the Securities Market of Panama under an abbreviated registration procedure for recurring registered issuers pursuant to Agreement 1-2019. The Bonds were successfully offered through Panama Stock Exchange, S.A. and were acquired by a group of institutional investors led by Banco General. The Issuer used the funds derived from the sale of the Bonds mainly to cancel the Series A of the corporate bonds issued under a public offering of bonds which is registered with the Superintendence of the Securities Market under Resolution No. SMV-407-15 of June 30, 2015 (the “2015 Bonds”), and to cancel a subordinated loan with Banco General.
The Issuer’s obligations derived from the Bonds are guaranteed by a guaranty trust (the “Trust”) that was constituted in 2015 by the Issuer and BG Trust, Inc., the latter in its capacity as trustee, to guarantee the Issuer’s obligations arising from the 2015 Bonds, and which was modified on May 14, 2020 pursuant to the approval of a super majority of the holders of said bonds. Such amendment was registered before the Superintendence of the Securities Market under Resolution No. SMV-212-20 of May 15, 2020, mainly for the purpose of establishing that, once the obligations arising from the 2015 Bonds have been canceled, the Trust will continue to be in full force so as to guarantee the Issuer’s obligations under the Bonds. The assets of the Trust consist mainly of revenue flows that the Issuer is entitled to receive pursuant to energy and/or power purchase agreements and transactions in the spot market. A pledge over the issued shares of the Issuer and mortgages on both movable and immovable property owned by the Issuer and related to the hydropower facilities have also been created in favor of the trustee.
Morgan & Morgan represented Electron Investment, S.A. in an arbitration process filed by Constructora Seli Panamá, S.A. before the International Chamber of Commerce
Morgan & Morgan was part of the team of lawyers that represented Electron Investment, S.A. (“EISA”), in an arbitration process filed by Constructora Seli Panamá, S.A. (“SELI”), before the International Chamber of Commerce (“ICC”).
The request for arbitration was filed by SELI following certain disputes related to the contract for the construction of the tunnels of Pando and Monte Lirio Hydroelectric Projects, a contract that had been terminated by EISA as a result of a series of breaches by SELI, mainly due to failure to meet the deadline for the completion of the works. The construction contract was an EPC (engineering, procurement and construction) using the silver book of the International Federation of Consulting Engineers (FIDIC, by its initials French), where the contractor assumes responsibility for the design and construction of the project, in this case, of the tunnels of the hydroelectric power plants.
The process was under arbitration at law, according to Panamanian law and according to the rules of procedure of the ICC, having seat in Panama City, Republic of Panama. The total sum of the claim filed by SELI amounted to US$94,065,202.00; and EISA, for its part, filed a counterclaim for an amount of US$110,000,000.00.
After the evidence was heard and the corresponding steps of procedure were concluded, the arbitral tribunal issued the final award dated January 29, 2018, communicated to the parties on February 14, 2018, accepting most of the EISA’s claims and ordering SELI to pay EISA the sum of US$22,524,862.58; that after compensating the sums recognized in favor of SELI, results in an amount in favor of EISA of US$14,653,362.12, plus costs and expenses.
SELI subsequently filed a motion for annulment of the award before the Fourth Chamber of General Businesses of the Supreme Court of Justice, which is pending resolution.
EISA is a Panamanian company whose shareholders are Aurel, S.A. (a Panamanian company owned by Grupo Eleta), Compañía Española de Financiación del Desarrollo, COFIDES, S.A. (a Spanish company whose purpose is to provide medium and long-term financing for viable private investment projects abroad in which there is Spanish interest), and Genera Avante, S.L. (a Spanish owned company of Grupo Inveravante).
EISA has two hydroelectric generation concessions that use of the waters of the Chiriqui Viejo, Pando and Monte Lirio Rivers, which together have an installed capacity of 85MW. Monte Lirio started operations in October of 2014, while Pando is still under construction due to delays in the excavation of the tunnel.
José Carrizo and Ramón Varela, partners; and the associates Mayte Sánchez, Ana Carolina Castillo Solís and Analissa Carles, participated in this process.