UFS enters into supplemental agreement with bond subscribers

By Romel S. Gurky

SGX-listed United Fiber System Limited (UFS) said on Thursday it has entered into a supplemental agreement with subscribers of bonds issued in connection with the proposed S$1.88 billion acquisition of 66.9998 percent shares of IDX-listed coal miner PT Golden Energy Mines Tbk from IDX-listed PT Dian Swastatika Sentosa Tbk.

Following is the complete version of the company?s statement.

UFS refers to the announcements released by the Company on 16 July 2013 (?SPA Announcement?), 31 January 2014 and 7 July 2014 (?SPA Supplemental Announcement?) in relation to the Proposed DSS Acquisition and the announcement released by the Company on 30 August 2013, in relation to the Bonds Issue (?MCB Announcement?). Further to the SPA Supplemental Announcement, the Board wishes to announce that the Company has, on 31 July 2014, entered into a supplemental agreement (?MCB Supplemental Agreement?) with the Subscribers to amend certain terms and conditions of the Subscription Agreement as required under the SPA Supplemental Agreement.

1 Key Amendments. In view of the agreement between the Company and DSS to extend the long-stop date for the Proposed DSS Acquisition to 31 March 2015 as announced in the SPA Supplemental Announcement, the Subscribers have agreed with the Company to, inter alia, (i) extend the Cut-Off Date for the closing of the Bonds Issue, from 31 January 2014 to 31 March 2015, to correspond with the extension of the Acquisition Long-Stop Date; (ii) increase the material adverse change threshold from US$20 million to US$56 million in connection with assessing the occurrence of an event of default by the Company under the Bonds Issue; and (iii) limit the Company?s aggregate liabilities to all the Subscribers up to and including 31 March 2015 under the Subscription Agreement (including any accrued interest payable under the Mandatory Convertible Bonds) to no more than S$46.5 million (?Maximum Liabilities Limit?), which shall constitute full and final settlement of all claims against the Company by the Subscribers in respect of the Corporate Guarantees.

2 Maximum Liabilities Limit. Each Subscriber agrees to reduce, on a proportionate basis and if required, the maximum principal amount of Bonds to be issued to such Subscriber (?Maximum Principal Amount?) and the maximum amount of yield that shall accrue under the Bonds to be issued to such Subscriber (?Maximum Yield Amount?), such that the Company?s aggregate liabilities to the Subscribers up to and including 31 March 2015 under the Subscription Agreement (including any accrued interest payable under the Mandatory Convertible Bonds) shall not exceed the Maximum Liabilities Limit.

3. Conversion Shares. For illustration only, based on the revised aggregate principal amount of the Bonds of up to S$45,834,458.56, the Conversion Price, a Closing Date of 15 December 2014, the yield calculated at a rate of 5% per annum on the basis of a 365-day year and the actual number of days elapsed from 15 December 2014 up to until the Conversion Date, which is assumed to be 31 March 2015, the number of Conversion Shares to be allotted and issued by the Company assuming full conversion of the Bonds is approximately 2,447,368,421 Conversion Shares, representing approximately 63.33% of the existing issued share capital of the Company and approximately 2.14% of the enlarged share capital of the Company1. An illustration of the foregoing is set out in Appendix A to this Announcement.

A copy of the MCB Supplemental Agreement will be made available for inspection during normal business hours at the registered office of the Company for three (3) months from the date of this Announcement.

Editing by Reiner Simanjuntak