Green Bond Framework

Transcription

1 Green Bond Framework MEP Werke GmbH / Strasser Capital GmbH

2 Green Bond Framework I. Introduction Under the Solaris Financing Program, MEP periodically issues Green Loans or Green Bonds and is committed to using the proceeds of these loans or bonds for the refinancing of green assets. All eligible assets under the Solaris Financing Program are residential rooftop PV systems that are installed and operational and which have been leased over a 20 year term to homeowners throughout Germany by a designated Asset SPV. The PV systems are initially funded through a senior warehouse facility provided to a Funding SPV by NIBC Bank Deutschland AG (the Senior Lender) and subordinated capital provided to the Asset SPV by the solar sprint closed-ended fund series (the Junior Lender). These initial sources of funding are refinanced by way of issuance of long term loans or bonds. The loans or bonds are structured as senior secured fixed rate loans and are subscribed by either one institutional investor on a stand-alone basis or on a syndicated-basis by two or more investors. Any assets nominated for financing under the Solaris Financing Program are owned by the Asset SPV for the entire term of the Loan or bond and full security over the assets is transferred to the security trustee on behalf of the issuer. II. Green Bond Programm The MEP Solar Lease enables private households in Germany to produce their own 100 percent green electricity and sustainability is thus at the core of the MEP business model. In December 2015, MEP signed a Senior Warehouse Facility Loan Agreement with NIBC Bank Deutschland to finance the origination of solar lease contracts through a designated Asset SPV. This Warehouse Facility was refinanced by way of a Green Loan issuance subscribed by Dutch institutional investor Delta Lloyd Levensverzering N.V. in December 2016, the first Certified Green Loan in Europe. After conclusion of the financing contracts, further asset financing

3 for the MEP solar lease business model was secured and using the identical refinancing structure, MEP will periodically issue Green Loans or Green Bonds and is continuously aiming for diversification in its investor base to enable further growth of the solar lease portfolio. The Solaris Financing Program is thus pivotal to the success of the MEP business model and will continue to make investments into the private energy transition available to institutional investors. III. Green Bond Principle 1. Use of Proceeds: The proceeds of each loan or bond issue under the Solaris Financing Program are used exclusively to refinance the existing indebtedness of a designated Funding SPV incurred by the Borrower in aggregating a portfolio of fully installed and operational residential rooftop PV systems. From a sustainability point of view, the assets financed by the Solaris Financing Program are positive as they contribute towards a transition to a low carbon economy. The gross proceeds of each loan or bond issued are determined by calculating the present value of the net lease income of the pool of underlying lease contracts. 2. Process for Evaluation and Selection: All nominated assets are fully operational PV systems and the lease receivables from the underlying lease contracts. All MEP clients, the underlying lease contracts and the underlying lease receivables must meet the stringent and bank approved MEP Underwriting and Eligibility Criteria prior to acceptance into the pool of nominated assets. The assets are owned by the asset SPV over the whole term of the lease contract and pledged to a Security Trustee and a security transfer of title is performed under the loan agreement on behalf of the lender. 3. Management of Proceeds: Each loan issued under the Solaris Financing Program is issued by a separate bankruptcy remote SPV which is administered by an independent Trust Agency and NIBC Bank N.V. as Funding SPV Administrator. All accounts of the issuer are therefore administered by the initial Senior Lender ensuring appropriate usage of funds in line with the Loan Agreement. The Borrower establishes accounts both assigned and pledged to a Security Trustee on behalf of the Issuer. The Issuer and its administrator have viewing rights or administration rights over the Borrower s accounts.

4 4. Reporting: The Issuer provides the Investor with a quarterly Servicer Report detailing the financial performance of the Loan or Bond. In addition, the issuer prepares an annual report on the structural composition and environmental performance of the pool of underlying solar lease contracts which is presented to the Investor and the Climate Bonds Initiative Secretariat. This includes the number of PV systems by system size, aggregate electricity production and avoided CO 2 emissions (over the reporting period as well as over the entire term of the loan or bond). IV. External Review MEP has appointed Oekom Research AG (Oekom) to verify the sustainability of the first tranche of the Solaris Financing Program. The results are documented in the Oekom s Verification Report which is available on the MEP s company website. Through the envisaged inclusion in the CBI Programmatic Certification Program for regular issuers, this verification refers to the entire Solaris Financing Program and includes every security that is issued under it. Oekom or any other party appointed by MEP as a successor for Oekom in the future will issue a report verifying the compliance of all issued loans or bonds with the criteria documented in this program on an annual basis. These reports will show the results of the assessment of the sustainability performance of the Program and the issued Green Bonds or Loans and will be published on MEP s company website.

5 MEP Werke GmbH Mies-van-der-Rohe-Str. 6 D München Tel.: +49 (0) 89 / Fax: +49 (0) 89 / info@mep-werke.de Web: MEP Werke GmbH / All rights reserved.