| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers U > Headlines for Urban Corp. > News item |
Urban amends euro-yen convertible bonds to make swap agreement payment
By Caroline Salls
Pittsburgh, Aug. 20 - Urban Corp. has amended the issuance of its euro-yen convertible bonds due 2010, according to a news release.
Under the amendment, the funds procured through the issuance of the convertible bonds will be used to make a payment under a swap agreement between the company and a party to which the bonds will be allotted.
Then, the proceeds from the swap agreement will be used to repay short-term debt that was borrowed by Urban to secure its financial base.
Before the amendment, the funds from the bond issuance were earmarked for repayment of the short-term debt.
According to the release, Urban entered into swap agreements with BNP Paribas SA in June and July in connection with the bond issuance, taking into account the company's significant need to raise funds and strengthen its capitalization.
Under the swap agreements, the company was scheduled to pay ¥30 billion to BNP Paribas, and BNP was to pay Urban 90% of the volume weighted average price of the company's shares multiplied by the number of the company's shares, on each business day from June 27.
In addition, on July 11, 2010, BNP was to make the final payment on ¥30 billion paid initially by Urban, minus ¥344 of the strike price for the convertible bonds multiplied by the number of the company's shares.
Urban said the payments BNP has made under the swap agreements to date have been far below what the company originally expected because the market price of Urban's stock has fallen significantly below what the company expected at the time of execution of the swap agreements.
Since the filing of its petition for civil rehabilitation triggers a termination event under the swap agreement, Urban said it is not definitely unable to apply the swap agreement payments from BNP to the repayment of its debt.
In addition, Urban said it has incurred a ¥5.8 billion non-operating loss as a result of the swap agreements.
Urban is a Hiroshima, Japan-based real estate company.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.