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Individual Guarantees for Bonds

Individual Guarantees for Bonds

What are the benefits?

INVEGA provides guarantees that facilitate or enable the issuer of bonds (a private limited company or a public limited company) to publicly or privately distribute (sell) a new bond issue aimed at financing investments and/or supplementing working capital.

All electronically signed documents with the completed application for the provision of guarantee and later with the completed request for payment are to be sent to INVEGA via email at info@invega.lt.

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List of documents to be submitted when applying for a guarantee:

  1. Application for a bond guarantee; one copy is to be submitted.
  2.  SME status declaration.
  3. Declaration of a ‘Single Enterprise’.
  4. Detailed form (to be submitted also in Excel format).
  5. Notification regarding the processing of personal data.*
  6. Financial reporting documents: balance sheet and profit (loss) statement.
  7.  A civil (service) contract with the trustee of the bond holders; to be submitted when required by the Law on the Protection of Interests of Bondholders of Public and Private Limited Companies.
  8. Decision of the bond issuer's shareholder(s) to issue bonds.
  9. Prospectus or other information document about the intended bond issue.

Documents submitted for amendment to the terms of the guaranteed bond issue:

  1. Application on amendment of the terms and conditions of the guaranteed bond issue.

Notes:

  • Allndocumet forms must be presented in Lithuanian language.
  • All documents must be submitted by the issuer.
  • Documents must be signed electronically.
  • Requests for guarantees, requests for amendments to the terms of the guarantee and contracts are to be sent by email info@invega.lt.
  • The guarantee application will be processed only upon receipt of all documents.
  • INVEGA has the right to request that documents submitted in a language other than Lithuanian be translated into Lithuanian.

* Notifications regarding the processing of personal data by the issuer’s manager and Lithuanian citizens or holders of a permanent residence permit in Lithuania who hold a controlling stake in shares/units/other equity parts, when collecting data from any state and non-state institutions, companies, and organisations for credit risk assessment purposes, are provided in the following cases.

More detailed information is provided in the Lithuanian version.

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What is the maximum amount?

The maximum amount of the guarantee is EUR 5,000,000.

The intensity of the guarantee is 50% of the nominal value of the bond for each specific bond issue.

Guarantees are not provided

INVEGA’S guarantee is not provided in the following circumstances.

1. If the bond issuer operates in the following areas:

  • Financial and insurance services (activity codes according to the Classification of Economic Activities approved by the order of the Director General of the State Data Agency (NACE Rev. 2) division 64–66); 
  • Wholesale trade of distilled alcoholic beverages;
  • Specialised retail trade services of arms and ammunition (activity code according to NACE Rev. 2, class 47.78.30);
  • Manufacture and/or wholesale trade of tobacco products (all activity codes according to NACE Rev. 2 chapter 12 and class 46.35);
  • Organisation of gambling or betting (all activity codes according to NACE Rev. 2, section 92);
  • Purchase, sale, rental and operation of own or leased real estate, real estate transactions (all activity codes according to NACE Rev. 2, groups 68.1 to 68.3);
  • Primary production of fishery and aquaculture products, primary production of agricultural products, and/or export-related activities in third countries or Member States, as specified in Article 1 of Regulation (EU) 2023/2831.

If the bond issuer operates in the areas listed above, as well as other activities, they must ensure that the funds obtained from the issuance of guaranteed bonds will not be used to finance the activities listed in this section. The guarantee is not provided in the event that the bond issuer cannot ensure (segregate) that the funds obtained from the issuance of guaranteed bonds will not be used to finance the activities listed in this section.

2. When a bond issue is issued, the funds obtained from the bond issue may not be used for the following.

  • Acquisition of financial assets, other than the acquisition of shares, for the purpose of expanding the business of the issuer of the bonds. Acquisition of shares in companies controlled by the issuer of the bonds shall not be considered as business development.
  • Capital formation, as well as for repurchasing own shares or for making other payments out of capital to shareholders, members, participants, stakeholders or other entities participating in the capital of the bond issuer.
  • Restructuring of the bond issuer or any other entity engaged in economic activity that is considered as a single enterprise with the bond issuer.
  • Purchase and/or construction of real estate and/or investments in the improvement of real estate with a view to sell, lease, or otherwise transfer it to other natural or legal persons who are not considered a single enterprise with the bond issuer, instead of using it in the bond issuer’s and its participants’ activities. Using real estate in a person’s activities means use when at least 60% of the acquired, constructed or improved real estate is intended to be used for the bond issuer’s economic activities, except for activities according to NACE Rev. 2, groups 68.1–68.3. The leasing restriction does not apply when the bond issuer engages in hotel and/or other short-term accommodation services (all activity codes according to NACE Rev. 2, group 55) or leases of workspaces under workspace rental contracts, or engages in storage activities (activity code according to NACE Rev. 2 group 52.1 and class 52.10).
  • Financing the acquisition of assets which would be used for activities other than those of the bond issuer.
  • Financing of investments made outside the territory of the Republic of Lithuania, except for investments made in Ukraine.
  • Making payments to the participants of a bond issuer out of the profits of the bond issuer.
  • Re-lending the funds received from the bond issuance to other natural or legal persons.
  • Acquisition of agricultural land.
  • Refinancing of a previous outstanding bond issuance of the issuer.

3. INVEGA’s guarantee is also not provided for the following.

  • If the bond issuer is involved in money laundering, terrorist financing and tax evasion, in accordance with the requirements of the Law on the prevention of Money Laundering and Terrorist Financing and Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018. This is on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU. It repeals Regulation (EU, Euratom) No 966/2012 as amended by Regulation (EU, Euratom) 2022/2434 of the European Parliament and the Council of 6 December 2022.
  • If the bond issuer does not meet the minimum criteria for a reliable taxpayer set forth in Article 401 of the Republic of Lithuania Law on Tax Administration. Compliance with this requirement is assessed based on publicly disclosed information from the State Tax Inspectorate under the Ministry of Finance of the Republic of Lithuania, available on its website: https://www.vmi.lt/evmi/mokesciu-moketoju-informacija.
  • If the bond issuer has not submitted the annual financial statement set for the previous financial year to the state enterprise Centre of Registers, when such an obligation is established by the laws applicable to its activities.
  • If the bond issuer has or hasn’t terminated commercial obligations with the Russian Federation, the Republic of Belarus, annexed Crimea, the non-government-controlled territory of Transnistria in the Republic of Moldova, and the non-government-controlled territories of Abkhazia and South Ossetia in Georgia until 31 August 2022.
  • If the bond issuer maintains business relationships with legal entities registered in jurisdictions that do not cooperate with the EU in the field of internationally agreed tax application, or conducts or intends to conduct transactions with legal entities registered in the targeted territories (the list of target territories is approved by Order No 344 of the Minister of Finance of the Republic of Lithuania of 22 December 2001 ‘On approval of the list of target territories’).
Guarantee fee

The bond issuer should pay a one-time guarantee fee, which must be paid before the issuance of the guarantee.

The guarantee fee is based on the guarantee amount and  the guarantee maturity, i.e. a fixed base rate is applied for the first year (1-12 months) and an annual premium will be charged for each subsequent year.

The fixed base is 1%, and the annual premium will be 0.9% for each subsequent year.

uzklausos@invega.lt +3705 210 7510
+370 5 210 7510
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