Cencorp - Company Announcement

CENCORP ISSUES A CONVERTIBLE CAPITAL BOND

Cencorp Corporation                         Stock Exchange Release 17.5.2013 at
14.30 



CENCORP ISSUES A CONVERTIBLE CAPITAL BOND





In order to secure the financing required to strengthen Cencorp's capital
structure, the company issues convertible bond with the maximum amount of EUR
2,100,000 and simultaneously issues stock options with maximum amount of
30,000,000 free of charge. One (1) stock option is issued per each subscribed
loan capital amount of EUR 0.07. 



The convertible bond is issued in deviation from the shareholders' pre-emptive
subscription rights to those current Cencorp shareholders who directly on the
record day of 16 May 2013 own at least one million (1,000,000) Cencorp's shares
or who otherwise are approved by the Board of Directors. Convertible bond can
also be subscribed against a loan receivable from Cencorp, undisbuted on the
record day, by converting the loan's capital and/or interest into convertible
bond according to the terms of the convertible bond. 



The loan period starts as of the payment of a loan to the company and ends on 2
June 2015 when the convertible bond will be due in its entirety pursuant to the
loan terms. 



The loan is a capital loan.



The shareholders' pre-emptive subscription rights are being deviated from as
the stock options are issued to secure financing required to strengthen
Cencorp's capital structure cost effectively and considering the size of the
financing. Thus, there is, from the company's point of view, a weighty
financial reason to issue the stock options. 



An annual interest of eight (8) % will be paid on the convertible bond from the
withdrawal of the bond. A holder of the bond has a right to subscribe an amount
of shares, equivalent to the bondholders hareholding percentage at the time, in
Cencorp's possible future share issues with subscription period ending latest
by 2 June 2015, at a subscription price that is 10 % lower than the
subscription price in the share issue in question. 



The holder of the bond is entitled to convert the promissory note into the
shares of the Company. One (1) stock option pursuant to the promissory note
entitles the bond holder to subscribe for one (1) new share of the company.
Based on the subscriptions made pursuant to the stock options, the Company
shall issue a maximum amount of 30,000,000 new company shares. The company has
one (1) class of shares. 



The terms of the convertible bond are, without the technical appendices,
attached to this release as Attachment 1. 



Successful issuance of the convertible bond involves risks. It is not sure
whether the company will be able to collect EUR 2.1 million with the
convertible bond to strengthen its capital structure. 





In Mikkeli, 17 May 2013



CENCORP OYJ



BOARD OF DIRECTORS







For more information, please contact:



Cencorp: Iikka Savisalo, President and CEO, tel. +358 40 521 6082,

iikka.savisalo@savcor.com





Distribution:

NASDAQ OMX, Helsinki

Main media

www.cencorp.com





Cencorp Corporation is a leading provider of industrial automation solutions.
The equipment included in the product portfolio designed for depaneling,
odd-form assembly, testing and laser materials processing substantially
improves the efficiency of customers' production. The product range also
includes EMI shielding solutions, RFID antennas, other flexible circuits
including for example conductive back sheets used in photovoltaic modules and
mobile phone antennas. Cencorp's customers are manufacturers of automotive
electronics, mobile phone antennas and photovoltaic modules as well as
manufacturers operating in telecommunications and in industrial automation.
Cencorp's head office is located in Mikkeli, Finland. The company is part of
the Finnish Savcor Group. 







Attachment 1.





The Board of Directors of Cencorp Corporation (hereinafter the “Company”) has,
based on the authorization granted to it on January 30, 2012, resolved to take
loan (Convertible Bond I/2013) so that the Company issues stock options to the
lenders of the loan so that the lenders shall have the right to subscribe for
the Company's shares based on the respective stock options and that the lenders
shall have the right to pay the subscription price of the shares by setting it
off against the loan receivable referred to in this document (hereinafter the
“Convertible Bond”) in accordance with the following terms: 



I TERMS OF THE CONVERTIBLE BOND



1. Principal of the Convertible Bond



The total principal amount of the Convertible Bond is two million one hundred
thousand euro (EUR 2,100,000.00) (the Convertible Bond). 



2. Subscription Right for the Convertible Bond and Stock Options



The Company shall take the loan referred to in this Convertible Bond and shall
issue simultaneously against the loan a maximum number of 30,000,000 stock
options free of charge. The number of stock options to be issued shall be one
(1) stock option against each subscribed loan capital amount of 0,07 euro. 



The Convertible Bond is issued for subscription, in deviation from the
shareholders' pre-emptive subscription rights, to such shareholders who on May
16, 2103 (hereinafter the “Record Date of the Convertible Bond”) own directly
at least one million (1.000.000) Company shares or to other parties separately
approved by the Board of Directors. The Convertible Bond can also be subscribed
against the undisbuted loan receivable from the Company as per the Record Date
of the Convertible Bond by converting the loan capital and/or interest
receivable into the Convertible Bond in accordance with the terms of this
Convertible Bond. 



The minimum subscription amount of the Convertible Bond shall be ten thousand
(10.000,00) euro. 



The shareholders' pre-emptive subscription rights are deviated from as the
stock options are issued to secure financing required to strengthen the capital
structure of the Company cost effectively and considering the size of the
financing. Thus, there is from the Company's point of view a weighty financial
reason to issue the stock options. 



3. Subscription Period and Venue for Subscription of the Convertible Bond



Such shareholders who are interested in subscribing for the Convertible Bond
and who meet the conditions mentioned above in Section I.2 on the Record Date
of the Convertible Bond are asked to sign and submit the subscription form
attached as Appendix 1 to this Convertible Bond by May 24, 2013 at 6:00 p.m. to
the Company in accordance with the instructions included in the form. The
subscription shall take place when the Company receives the above mentioned
form by 6:00 p.m. on May 24, 2013. 



In the event the Convertible Bond and the related stock options are
oversubscribed, the Board of Directors of the Company shall resolve on the
allocation between the subscribers so that for each subscriber a minimum of a
percentual share of the Convertible Bond and related stock options shall be
allocated corresponding to the share ownership amount of the subscriber on the
Record Date of the Convertible Bond. 





4. Loan Period of the Convertible Bond and Repayment



The Convertible Bond shall be paid to the Company's bank account Nordea Bank
Finland Plc IBAN: FI21 2185 1800 1271 11, BIC: NDEAFIHH at the latest on May
24, 2013. The loan period shall commence on the payment date and expire on June
2, 2015 (hereinafter the “Maturity Date”) on which date the Convertible Bond
shall expire to be repayable in its entirety in accordance with these terms of
the loan. 



The Company shall be entitled pursuant to the resolution of the Board of
Directors of the Company to repay the Convertible Loan or a part of it to the
holder of the Promissory Note signed in accordance with Section I.6 below also
at any time prior to the Maturity Date. 



The Company shall inform the holder of the Promissory Note on the repayment 30
(thirty) days prior to the contemplated repayment. The holder of the Promissory
Note shall then have the possibility to inform the Board of Directors of the
Company within that 30 (thirty) days time period whether the holder uses
his/her/its right to subscribe for the Company's shares in accordance with
Section II prior to the repayment provided that the subscription shall take
place within the subscription period of the shares defined under Section II.2. 



The repayment of the Convertible Bond shall take place against the assignment
of the Promissory Note and in the event of a partly repayment, against a note
to be entered to the Promissory Note. 



Additionally the terms defined in Section I.9 are applicable to the repayment
of the Convertible Bond. 



5. Interest of the Convertible Bond



As of the date of withdrawal an annual interest of eight (8) percent shall be
paid to the capital of the Convertible Bond. The interest shall be paid
annually afterwards on June 30. 



The last interest period shall end on the date on which the Convertible Bond
shall be repaid in its entirety. The interest shall be calculated based on the
real interest days divided with 365 days. 



Upon the due date of the Convertible Bond on June 2, 2015, all the unpaid
interests from the loan period shall also fall due on June 2, 2015. 



In the event the date of interest payment is not a banking day, the interest
shall be paid on the following banking day. 



6. Promissory Note of the Convertible Bond



The Company shall issue to the subscriber of the Convertible Bond (hereinafter
the “Promissory Note Holder”) a promissory note (hereinafter the “Promissory
Note”)  referred to in Appendix 2, which simultaneously serves as the stock
option certificate of the stock options referred to in Section I.2. The
Promissory Noted shall not, however, be issued prior to the date when the stock
options related to the Convertible Bond have been registered with the Companies
Register. 



The Company commits to notify the Companies Register on the issue of the stock
options related to the Convertible Bond within one month from the date on which
the Company has resolved on the issue of the stock options related to the
Convertible Bond. 



7. Transferability of the Promissory Note and Stock Options



The Promissory Note and related stock options and other rights and
responsibilities cannot be transferred without consent of the Company. The
stock options related to the Convertible Bond are not transferable unless the
loan based on the Promissory Note is also transferred simultaneously. 



8. Right to Participate in the Forthcoming Share Issues by Discounted
Subscription Price 



A Promissory Note Holder shall be entitled to participate, by at least with the
amount corresponding to his/her/its percentual shareholding of the Company's
shares at that time, in potential future share issues arranged by the Company
in which the subscription period shall terminate at the latest on June 2, 2015
by subscribing the shares at the subscription price that is 10 per cent lower
compared to the subscription price offered in the respective share issues. 



9. Capital Loan



The Convertible Bond is a capital loan, pursuant to the Finnish Companies Act,
Chapter 12, Section 1, and will be recorded as a separate item in the Company's
balance sheet. A capital loan and an interest on the capital loan can only be
repaid pursuant to the rules regarding the capital loans in the effective
Finnish Companies Act. A Company or its subsidiary cannot deposit a security on
the payment of the capital loan principal or interest. 



10. Other



For the delivery of the notifications based on this Convertible Bond, the
Promissory Note Holder shall inform the Company of his/her/its postal address
as from time to time. 



The Promissory Note Holder shall, as per request of the Company, submit to the
Company all necessary information with regard to the Promissory Note and its
administration. 



II TERMS FOR SHARE SUBSCRIPTION AND CONVERSION RIGHT



1. Conversion Right and Conversion Ratio



The Promissory Note Holder is entitled to convert the Promissory Note into the
shares of the Company in accordance with the terms described below. One (1)
stock option pursuant to the Promissory Note entitles the Promissory Note
Holder to subscribe for one (1) new share of the Company. Based on the
subscriptions made pursuant to the stock options the Company shall issue a
maximum number of 30,000,000 new Company shares. The Company has one (1) class
of shares. 



The subscription price of one (1) new share of the Company shall be 0,07 euro
per share. The subscription price has been set at the level which can be
considered fair from the point of view of the Company's shareholders given the
Company's share price during the past three months and the need to secure the
successful issuance of the Convertible Bond. 



Upon using the conversion right a portion corresponding to the subscription
price of the shares shall be set off against the unpaid capital of the
Convertible Bond and, subject to the consideration of the Board of Directors,
against the unpaid interest of the Convertible Bond. The subscription price of
the shares shall be entered in entirety into the reserve for invested
unrestricted equity. 



2. Conversion Period and Process Regarding Use of the Conversion Right



The Promissory Note Holder shall have the right to convert the Promissory Note
into the Company's shares during the conversion period (subscription period of
the shares) which commences on June 1, 2013 and which terminates on June 2,
2015. 



The conversion of the Promissory Note into the shares shall take place pursuant
to the subscription rules in accordance with the Finnish Companies Act. The
Promissory Note Holder shall present to the Board of Directors of the Company
the written conversion request as attached in Appendix 3 which shall constitute
the subscription of new shares. The Convertible Bond may be converted into
shares only in its entirety. 



When the Board of Directors has received the conversion request and the
Promissory Note Holder has assigned the Promissory Note to the Company, the
Board of Directors shall approve the subscription of new shares in accordance
with the Convertible Bond. Within 30 (thirty) days from the presentation of the
conversion request the Company shall file with the Companies Register
notification with regard to entering the new shares to the Companies Register.
In addition, the Company commits to take care that the new shares entered into
the Companies Register shall be entered into public trading within 30 (thirty)
days from entering them to the Companies Register. 



3. Shareholder Rights



The new shares of the Company, which have been subscribed for by using the
conversion right of the Convertible Bond, shall have the similar rights with
the Company's shares issued previously from the moment the new shares have been
entered into the Companies Register. 



4. The Rights of the Promissory Note Holder in Certain Special Cases



If the Company during the loan period issues new shares in the share issue
against the payment or issues new stock options or other special rights
entitling to the shares referred to in Chapter 10 of the Finnish Companies Act
so that the shareholders shall have the pre-emptive subscription right, the
Promissory Note Holder shall have the same or equal right as a shareholder.
Equality is reached by the means resolved by the Board of Directors of the
Company by giving to the Promissory Note Holder the same priority for the
subscription of share and/or convertible bond and/or stock option, and/or the
exchange ratio of the Convertible Bond will be adjusted and/or the Promissory
Note Holder is given the right to convert the Promissory Note to the shares
during the other time period than referred to in Section II.2, or by combining
the means referred to above. 



If the Company during the loan period issues new shares free of charge, the
exchange ratio of the Convertible Bond shall be adjusted so that the percentual
share of the shares to be converted by the Convertible Bond compared to all
shares shall remain unaltered except for the part that the new number of shares
to be converted by the Promissory Note would be a fraction. In the event that
the above mentioned division would not be even, the highest round figure that
will fulfill the division to the whole shares will be applied. 



If the Company during the loan period resolves to acquire or redeem its own
shares or stock options or other special rights entitling to the shares
pursuant to the Chapter 10 of the Finnish Companies Act through an offer
directed to all shareholders or holders of the above mentioned rights, an equal
offer shall be made to the holder of the Promissory Note. The redemption or
acquisition of the shares and stock options or other special rights entitling
to the shares referred to in Chapter 10 of the Finnish Companies Act shall thus
be directed to the conversion rights of the Promissory Note pursuant to the
resolution of the Board of Directors. Otherwise acquisition or redemption of
own shares and stock options and other special rights entitling to the shares
referred to under Chapter 10 of the Finnish Companies Act shall not require any
actions from the Company with regard to the Promissory Note. 



If the Company during the loan period distributes its funds by other means than
what has been referred to in the previous section, the Promissory Note Holder
shall not be entitled to participate in the distribution of the funds and the
distribution of the funds shall not require any actions from the Company with
regard to the Promissory Note. 



If the Company is placed into liquidation during the loan period, the
Convertible Bond shall fall due for payment at the moment when placing the
liquidation has been entered into the Companies Register. 



If the Company during the loan period resolves on the merger or division, the
Promissory Note Holders shall be reserved a right, during the time period set
by the Board of Directors of the Company prior to resolution on the merger or
division, to convert the Promissory Note into shares. Alternatively the
Promissory Note Holders shall be given the right to subscribe for the
convertible bond issued by similar terms by the receiving company so that the
subscription can be made on equal rights compared to the shares of the
receiving company which have been issued to the shareholders pursuant to what
has been resolved on the matter in the merger plan or division plan. After the
above-mentioned time period reserved for the use of the conversion right or
after the end of the subscription period of the new convertible bond, no
conversion right shall exist anymore. 



If a redemption right or redemption obligation of the minority shareholders
referred to under Chapter 18 of the Finnish Companies Act arises, after Company
has received notification on the basis of the redemption right or redemption
obligation, the right to convert the Promissory Note into shares during the
time period resolved by the Board of Directors shall without undue delay be
reserved for the Promissory Note Holders. After the above-mentioned time period
reserved for the use of the conversion right, no conversion right shall exist
anymore. 



5. Disputes



Disputes arising out of this Convertible Bond shall be settled by arbitration
consisting of one arbitrator in accordance with the Rules of the Arbitration
Institute of the Finland Chamber of Commerce. In the event the parties to the
dispute cannot agree on the arbitrator, the Finland Chamber of Commerce shall
appoint the arbitrator. The place of the arbitration shall be Helsinki,
Finland. 



6. Other Issues



The Board of Directors shall be entitled to resolve on any other matters
related to the Convertible Bond and the use of the conversion right.
Notifications to the Promissory Note Holders shall be submitted by letters to
the postal addresses notified to the Company by each of the Promissory Note
Holder. A notification is deemed to have been delivered on the working day
following the date of sending the notification. 



III OTHER MATTERS



1. Other Issues



These terms and conditions have been drafted in Finnish and in English. In the
case of any discrepancy between the Finnish and English terms and conditions,
the Finnish terms and conditions shall prevail.