Loans

Euro 225 million European Bank for Reconstruction and Development ("EBRD") Syndicated Loan

On July 24, 2013, Telekom Romania Mobile signed a Euro 225 million loan arranged by the EBRD. Telekom Romania Mobile received Euro 75 million directly from the EBRD and Euro 150 million through a syndicated loan from commercial banks. The loan bears an interest rate of Euribor plus margin of 5.25% p.a. and it is being repaid gradually via an amortizing schedule with final maturity in April 2018.

On August 22, 2013, Telekom Romania Mobile drew the full amount of Euro 225 million under the loan.

Up to September 30, 2017 Telekom Romania Mobile had repaid in total Euro 174.4 million under the loan. As a result, the nominal amount of the loan as of September 30, 2017 was Euro 50.6 million.

The loan includes three financial covenants tested on the Romanian mobile business consisting of the entities TELEKOM ROMANIA MOBILE, GERMANOS TELECOM ROMANIA S.A., ZAPP and SUNLIGHT ROMANIA S.R.L. FILIALA, namely: (i)The ratio of cash available for debt service over senior debt should exceed 1.25:1 for 2014, 1.20:1 for 2015 and 2016 and 1.15:1 for 2017 (2013: non-applicable), (ii) The ratio of EBITDA to net interest expense of senior debt should exceed 5:1 at all times, and (iii) The ratio of senior debt to EBITDA should not exceed 2.5:1 for 2013, 2.3:1 for 2014 and 2.0:1 for each subsequent year.

On October 25, 2017, Telekom Romania Mobile proceeded with the full repayment of the above Loan.

Euro 339 million Syndicated Loan arranged by the European Bank for Reconstruction and Development ("EBRD") and Euro 50 million parallel Loan by the Black Sea Trade and Development Bank ("BSTDB")

On September 12, 2016, OTE signed a Euro 339 million Syndicated Loan arranged by the EBRD and a Euro 50 million parallel bilateral loan with the BSTDB. Both loan facilities include same terms and conditions and specifically have a three-year tenor and will be repaid in equal semi-annual installments. Both loan facilities bear an interest rate of Euribor plus margin of 3.5% p.a.

On September 26, 2016, OTE drew the full amounts of Euro 339 million and of Euro 50 million under these loan facilities.  

Up to September 30, 2017 OTE had repaid in total Euro 113 million and Euro 16.7 respectively, under the abovementioned loans. As a result, the nominal amount of these loan facilities as of  September 30, 2017 was Euro 226 million and Euro 33.3 million respectively.

Both loans include two financial covenants tested on a semi-annual basis, namely:

(a) The ratio of consolidated operating profit before financial activities, depreciation, amortization, impairment, costs related to voluntary retirement programs and restructuring plans ("pro-forma EBITDA") to Consolidated Net Interest Expense should exceed 4.5:1 at all times, and

(b) The ratio of consolidated net debt to consolidated pro-forma EBITDA should not exceed 2.5:1 at all times.

Euro 150 million bilateral term loan with the European Investment Bank (EIB) and Euro 150 million syndicated facility arranged by the European Bank for Reconstruction and Development (EBRD)

On July 10, 2017, COSMOTE S.A. signed, with the guarantee of OTE, a Euro 150 million bilateral term loan with EIB and a Euro 150 million syndicated facility arranged by EBRD.  

On October 3, 2017, Cosmote SA proceeded with the drawdown of the full amount under the €150 million EBRD Loan.  Until the date of this posting, the EIB loan had not yet been disbursed.

The EIB bilateral loan has a tenor of up to 7 years from disbursement with semi-annual repayment schedule and bears fixed or floating interest rate which includes a margin of 2.65% p.aThe EBRD syndicated facility (structured as an A/B loan) has a maximum tenor of 3.5 years with semi-annual repayment schedule. The A Loan and B Loan bear floating interest rate which includes a margin of 2.95% p.a. and margin of 2.90% p.a. over Euribor respectively.

Both loans also include two financial covenants tested on a semi-annual basis at Group level, namely:

i.   The ratio of consolidated operating profit before financial activities, depreciation, amortization, impairment, costs related to voluntary retirement programs and restructuring plans ("pro-forma EBITDA") to Consolidated Net Interest Expense should exceed 4.5:1 at all times, and

ii.  The ratio of Consolidated Net debt to Consolidated EBITDA should not exceed 2.5:1 at all times.

The same covenants apply also at COSMOTE SA level.