Kawasaki Kisen Kaisha, Ltd. (“K” LINE) announced that it has decided to raise funds through subordinated loan (the “Subordinated Loan”) as detailed below.
1. Objective and Significance of the Subordinated Loan
In addition to the business structural reforms set forth in the announcement dated March 7, 2019, the
“K” LINE group has been developing its core businesses through the ongoing rebuilding portfolio
strategy, with an aim to expand the stable income business and achieve a sustainable growth. As one
of the measures to accomplish the goal, the group has decided to raise funds through the Subordinated
Loan, which is a financing method that enhances financial foundation while maintaining capital
efficiency.
2. Overview of the Subordinated Loan
“K” LINE is planning to raise funds through the Subordinated Loan with the following conditions.
Total Loan Amount: JPY45 billion
Date of Agreement: March 29, 2019
Loan Execution Date: April 5, 2019
Use of Loan: Proceeds Repayment of interest-bearing debts and capital expenditures mainly for vessels
Maturity Date: March 31, 2054 However, “K” LINE may, at its own discretion, make early repayment of all or part of the principal of the Subordinated Loan on March 31, 2024 or any interest payment date thereafter or upon occurrence of any predefined early repayment events.
Replacement Restrictions: There is no contractual provision on replacement restrictions. However, if “K” LINE repays the Subordinated Loan early, the company intends to replace the Subordinated Loan with other Company Name: Kawasaki Kisen Kaisha, Ltd. Representative: Eizo Murakami, President and CEO (Code Number 9107, listed on the 1st sections of the Tokyo and Nagoya Stock Exchanges and the Fukuoka Stock Exchange) Contact: Yu Kurimoto, General Manager, Finance Group (Phone: +81-(0)3-3595-5608） financial instruments that have obtained an equal or higher equity credit from the credit rating agency (Note).
Interest Deferral Clause: “K” LINE may defer interest payments at its own discretion.
Subordination Clause: The creditors of the Subordinated Loan shall have a claim subordinated to that of other senior debt creditors in the company’s liquidation, bankruptcy, corporate reorganization or civil rehabilitation proceedings or any equivalent proceedings under any laws other than Japanese Laws. Any provisions stipulated in the Subordinated Loan agreement shall not be amended in any manner which would create disadvantages for any “K” LINE’s creditors other than the creditors of the Subordinated Loan.
Lenders: Mizuho Bank, Ltd., Development Bank of Japan Inc., Sumitomo Mitsui Trust Bank, Limited
Evaluation of Equity Credit (expected): Middle Level, 50% (Japan Credit Rating Agency, Ltd.)
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