This no­tice was is­sued by Trinidad Ce­ment Ltd to its share­hold­ers on Oc­to­ber 3, 2011:

TCL Group debt re­struc­tur­ing

As share­hold­ers would be aware, dis­cus­sions had been ini­ti­at­ed with the group's lenders re­gard­ing a re-pro­fil­ing of its debt port­fo­lio con­se­quent up­on the on­set of the glob­al fi­nan­cial and eco­nom­ic cri­sis. The dis­cus­sions and ne­go­ti­a­tions have been tak­ing place with a steer­ing com­mit­tee com­pris­ing lenders who hold a ma­jor­i­ty of the group's out­stand­ing debt.

Cur­rent sta­tus

Agree­ment has now been reached with the steer­ing com­mit­tee on the terms and con­di­tions of the debt re-pro­fil­ing, sub­ject to fi­nal ap­proval by the lenders' cred­it com­mit­tees and by TCL's bond­hold­ers. All of the group's short- and long-term debt, with the ex­cep­tion of those of Readymix (West In­dies) Ltd and TCL Pack­ag­ing Ltd, will ef­fec­tive­ly be con­vert­ed in­to an eight-year fa­cil­i­ty with quar­ter­ly pay­ments of prin­ci­pal recom­menc­ing from March 2013, re­sult­ing in a prin­ci­pal bul­let pay­ment of 46 per cent due in 2018. In­ter­est pay­ments would recom­mence in De­cem­ber 2012 and in­ter­est rates will be in­cre­ment­ed by 200 ba­sis points ef­fec­tive Jan­u­ary 14, 2011, with in­ter­est in­crease penal­ties from 2016 if cer­tain per­for­mance met­rics are not met. A two per cent ac­cep­tance fee is payable to lenders which to­geth­er with un­paid in­ter­est will be added to the debt to be ser­viced.

The group is re­quired to pro­vide new se­cu­ri­ty to the cur­rent­ly un­se­cured lenders, as well as cur­rent­ly se­cured lenders, and main­tain spe­cif­ic fi­nan­cial ra­tios and ex­pen­di­ture lim­its dur­ing the life of the re-pro­filed debt. For suc­ces­sive quar­ters, TCL has record­ed bad per­for­mance. Its fi­nan­cial state­ments gave the de­tails. TCL's fi­nan­cial state­ment for the nine-month pe­ri­od end­ing Sep­tem­ber 30, 2011, re­vealed low­er rev­enue and a deep­er af­ter-tax loss that moved from $29.2 mil­lion in 2010 to $132 mil­lion in 2011. In the first quar­ter of 2011, the group con­tin­ued to be chal­lenged by weak de­mand as crit­i­cal do­mes­tic vol­umes de­clined by 13 per cent, whilst ex­port vol­umes were mar­gin­al­ly above the pri­or year com­par­i­son by one per cent. Ac­cord­ing­ly, rev­enue de­clined by $47 mil­lion or 11 per cent. As a con­se­quence of a high fixed cost as­so­ci­at­ed with our plants, set against re­duced rev­enue, the group is re­port­ing loss­es at­trib­ut­able to the par­ent of $23 mil­lion com­pared with a prof­it of $31 mil­lion for 2010. This trans­lates to loss­es per share of nine cents com­pared with earn­ings per share of 13 cents in 2010. In Jan­u­ary 2011, it was re­port­ed that TCL-which has sub­sidiaries in Ja­maica and Bar­ba­dos-was work­ing on elim­i­nat­ing its $260 mil­lion debt.

About half of that debt was ac­cu­mu­lat­ed from the mod­erni­sa­tion of its Carib Ce­ment plant in Kingston, Ja­maica.

The group an­nounced a debt re­struc­tur­ing ex­er­cise fol­low­ing a $55 mil­lion net loss to group share­hold­ers in its third quar­ter in Sep­tem­ber 2010. The board stat­ed then that the debt re­struc­tur­ing ex­er­cise was un­der­tak­en to al­low op­er­a­tions from the low­er in­come streams re­sult­ing from the "se­vere ef­fect of the cur­rent eco­nom­ic de­cline in all our mar­kets." In Ju­ly 2005, the In­ter­na­tion­al Fi­nance Cor­po­ra­tion, the pri­vate sec­tor arm of the World Bank Group, fa­cil­i­tat­ed TCL in struc­tur­ing and ar­rang­ing a US$105 mil­lion equiv­a­lent fi­nanc­ing pack­age to help TCL ex­pand and mod­ernise its Ja­maican sub­sidiary, Carib Ce­ment, while re­duc­ing car­bon emis­sions and im­prov­ing en­vi­ron­men­tal stan­dards.

IFC re­cent­ly signed an agree­ment with TCL to pro­vide US$35 mil­lion in se­nior and sub­or­di­nat­ed loans. In ad­di­tion, IFC helped TCL raise fi­nanc­ing to­talling US$70 mil­lion equiv­a­lent from re­gion­al banks, which in­clud­ed a US$20 mil­lion loan and a US$50 mil­lion equiv­a­lent bond is­sue.