Subex seeks holder approval to extend maturity of 2% convertibles

By Jennifer Chiou

New York, June 13 - Subex Ltd. announced a July 5 meeting in Singapore at which it will ask holders of its $39 million of outstanding 2% convertible bonds to prolong the maturity date by five years to March 9, 2017.

Other changes to be voted upon include, among other things, amending the definition of the conversion period in the trust deed to extend that period to Jan. 29, 2017.

In addition, the proposed modifications state that the bonds will continue to pay 2% interest, but they will be redeemed at 136.04% of par at maturity.

Further, holders will be asked to agree to Subex's incurrence of new debt and to waive any and all existing events of default under the trust deed.

According to a company filing with the London Stock Exchange, one condition to the second supplemental trust deed is for confirmation to have been received from the Bank of New York Mellon as trustee for Subex's $98.7 million of 5% convertible unsecured bonds due 2012 that holders have also passed an extraordinary resolution.

In March, the company received approval to extend the maturity date of the 2% bonds to July 9, 2012 from March 9, 2012.

On Feb. 27, Subex said it was working on a complete restructuring of the convertibles with the existing bondholders. The plan was expected to be completed in three to four months in two steps. The first step was the extension of the maturity date. The second step is expected to result in some of the bonds being converted to equity.

The filing stated that Subex's restructuring plan provides an incentive for holders of the 2% and 5% bonds to exchange their securities for new bonds with a lower conversion price.

A quorum will be met if two or more of holders of at least 75% of the 2% bonds are present at the meeting.

Subex provides business support systems for communications service providers and is based in Bangalore, India. It originally issued $180 million of the 2% convertibles.

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