Guaranteed Convertible Bonds
Xstrata Capital Corporation A.V.V.3 March 2009
Xstrata Capital Corporation A.V.V.
US$375,000,000 4.00 per cent. guaranteed convertible bonds due 2017 (the “Bonds”) guaranteed by Xstrata plc and convertible into 4.00 per cent. exchangeable redeemable preference shares of Xstrata Capital Corporation A.V.V. which are guaranteed by, and will be exchangeable immediately upon issuance for, ordinary shares in Xstrata plc
Notice of adjustment of Exchange Price
Adjustment Events
In respect of its 2006 financial year, Xstrata plc paid dividends totalling US$0.43 per Ordinary Share of which US$0.14008 per Ordinary Share constituted a Capital Distribution (the “2006 Capital Distribution”).
In respect of its 2007 financial year, Xstrata plc paid dividends totalling US$0.50 per Ordinary Share of which US$0.19266 per Ordinary Share constituted a Capital Distribution (the “2007 Capital Distribution” and together with the 2006 Capital Distribution, the “Capital Distributions”).
On 29 January 2009, Xstrata plc announced a proposed rights issue (the “Rights Issue”) of up to 1,982,508,352 new Ordinary Shares (“New Shares”), at a price per New Share of 210 pence, which is less than 95 per cent. of the Current Market Price per Ordinary Share. The Rights Issue was conditional on, amongst other things, Shareholders’ approval of an increase in the Xstrata plc’s share capital to create sufficient Ordinary Shares for the Rights Issue, the granting of authority to the directors of Xstrata plc to allot and issue the New Shares and to disapply pre‑emption rights. Following satisfaction of the conditions to the Rights Issue, Xstrata plc now announces an adjusted Exchange Price for the Bonds. The actual number of New Shares being offered pursuant to the Rights Issue is 1,955,341,080.
Adjustment of Conversion Terms
As described in Condition 7 of the Terms and Conditions of the Bonds (as constituted by a trust deed dated 13 October 2006 between Xstrata Capital Corporation A.V.V., Xstrata plc and Law Debenture Trustees Limited as trustee for the holders of the Bonds (the “Trust Deed”)) each US$1,000 principal amount of a Bond is convertible into one Preference Share with a paid‑up value of US$1,000. Preference Shares issued on conversion of Bonds will be allotted to the relevant Bondholders and immediately transferred to Xstrata plc in consideration for Xstrata plc delivering to the relevant Bondholders such number of Ordinary Shares as is determined by dividing the paid‑up value of each Preference Share (translated into pounds sterling at the fixed exchange rate of US$1.809 = £1.00) by the Exchange Price in effect on the Conversion Date (rounded down to the nearest whole number of Ordinary Shares). The current Exchange Price is 1527 pence per Ordinary Share converted into US dollars at the fixed exchange rate of US$1.809 = £1.00.
The terms of the Preference Shares as set out in the Articles of the Issuer and the Issuer Board Resolution (which are summarised in Condition 7(B) of the Terms and Conditions of the Bonds as set out in the listing particulars published by Xstrata Capital Corporation A.V.V. and Xstrata plc on 12 October 2006 (the “Listing Particulars”)) require an adjustment to be made to the Exchange Price if:
- Xstrata plc pays or makes a Capital Distribution to Shareholders as further described in the Articles of the Issuer and the Issuer Board Resolution and summarised in Condition 7(B)(iii) of the Terms and Conditions of the Bonds as set out in the Listing Particulars; and
- Xstrata plc issues Ordinary Shares to Shareholders as a class by way of rights at a price per Ordinary Share that is less than 95 per cent. of the Current Market Price per Ordinary Share as further described in the Articles of the Issuer and the Issuer Board Resolution and summarised in Condition 7(B)(iv) of the Terms and Conditions of the Bonds as set out in the Listing Particulars.
As the adjustments to the Exchange Price required as a consequence of the payment of the Capital Distributions in aggregate would have resulted in an adjustment of less than one per cent. of the Exchange Price, no adjustment was required to be made to the Exchange Price as permitted by the terms of the Preference Shares as set out in the Articles of the Issuer and the Issuer Board Resolution (which are summarised in Condition 7(B) of the Terms and Conditions of the Bonds as set out in the Listing Particulars). These adjustments were carried forward but will now be taken into account together with the adjustment being made in respect of the Rights Issue.
From and including the date of this announcement, being the first date on which the Ordinary Shares traded “ex‑rights” on the London Stock Exchange, the Exchange Price was adjusted to 817 pence per Ordinary Share converted into US dollars at the fixed exchange rate of US$1.809 = £1.00. All other Terms and Conditions of the Bonds remain unchanged.
The Exchange Price as adjusted applies to all Bonds for which the Conversion Date occurs on or after the date of this announcement.
Defined Terms
All words and terms that are capitalised herein shall have the same meaning as set out in the Terms and Conditions of the Bonds.
| Trustee Law Debenture Trustees Limited Fifth Floor, 100 Wood Street London EC2V 7EX United Kingdom |
| Principal Paying, Transfer, Conversion and Exchange Agent | Registrar and Paying, Transfer, Conversion and Exchange Agent |
| Citibank, N.A. Citigroup Centre Canary Wharf London E14 5LB United Kingdom | Citigroup Global Markets Deutschland AG & Co. KgaA Reuterweg 16 60323 Frankfurt am Main Germany |
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Xstrata contacts | ||||
| Claire Divver | Richard Elliston | |||
| Telephone | +44 20 7968 2871 | Telephone | +44 20 7968 2885 | |
| Mobile | +44 7785 964 340 | Mobile | +44 7759 924 576 | |
| cdivver@xstrata.com | relliston@xstrata.com | |||