1. What is a convertible in PA Resources?
PA Resources convertible 2008/2014 is a loan from the holder of the convertible to PA Resources amounting to 16 SEK per convertible. PA Resources pays an annual interest rate of 11 percent for this loan. Each year during the period 1-30 September in the years 2009-2013 you may according to the terms for the convertible (terms of PA Resources’ convertibles 2008/2014) request to convert your convertibles to shares at a conversion call rate of SEK 3,245 (adjusted in June 2010 and January 2013 due to rights issues and then adjusted following the reverse share split in April 2013). If no conversion is made before September 30, 2013, which is the last day for conversion, PA Resources will repay the loan (the nominal amount of 16 SEK per convertible), including accrued interest, to the holder of the convertible as per January 15, 2014.
2. When is the convertible’s interest paid?
The convertible has an annual interest of 11%, which is based on the convertibles nominal amount of SEK 16. The interest is calculated on the basis of a year consisting of 360 days – 12 months with 30 days each. The interest is paid annually on 15 January unless conversion has already taken place before this date. The distribution of interest in 2013 takes place on 15th January.
3. How is the interest paid?
The interest for the current year is distributed on 15th January 2013 to persons registered as holders of the convertible bonds in the Company's register at Euroclear Sweden AB (“Euroclear”) in Sweden on the record date 8th January 2012. If the holding is registered at VPS ASA (“VPS”) in Norway, the interest payment is made to those who are registered as holders of the convertibles in VPS on the 31 December 2011, due to administrative routines.
If the convertible bonds are registered in a VPC account with Euroclear or a VPS account with VPS, Euroclear and DNB Bank will manage the interest payment to the bank account connected to the VPC account or the VPS account. If such a bank account is not specified, the interest payment will be sent to the address specified in the register with Euroclear or VPS. If the holding is registered in the name of a nominee with a bank or brokerage firm, the interest payment will be made in accordance with each nominee’s routines and practices. Please contact your bank or nominee for more information.
4. How was the convertible affected by the rights issue in June 2010 and in January 2013 and the reverse share split in April 2013?
Due to the issues in 2010 and 2013, the conversion price for the convertible bond has been adjusted in accordance with a formula, specified in the Prospectus for the convertible on page 74. The former conversion price of SEK 16.00 was adjusted to SEK 8.52 due to the new issue of shares in 2010 and in conjunction with the rights issue in 2013 the conversion price was readjusted to SEK 6.49. Following the reverse share split in late April the conversion price was adjusted to SEK 3,245. At conversion, the number of shares to recieve will be rounded down to the closest whole number of shares.
5. How do I do if i would like to convert the convertibles to shares in September?
The holders of PA Resources convertible have the right to claim conversion into new shares during the period 1-30 September. The next conversion period takes place in September 2013 which is the last conversion period. For more practical details se the heading Conversion.
6. How many shares will I hold if I decide to convert?
The conversion price has been adjusted following share issues carried in 2010 and 2013, and following the reverse share split in April 2013. The conversion price is SEK 3,245 per share. That means that you, if you for example have convertible bonds with a nominal value of SEK 8,000, will receive 2 shares (8,000/3,245) at the time of the conversion.
Please note that the nominal amount required to be converted must be evenly divisible by 3,245 SEK. Any balance is left on the respective holder's account until the due date of the convertible bonds in February 2014. The remaining amount will be paid.
7. Is there any cost associated with the conversion into shares?
No, there is no cost for the conversion.
8. Do I have to convert my convertible bonds to shares in September?
You can choose to convert the convertible bonds into shares in the month of September each year 2012 and 2013, or you can keep your convertibles and continue to receive 11 percent interest in January each year until January 15, 2014 when the convertible loan matures. PA Resources will then repay the loan including accrued interest to the holders of the convertible at maturity date.
9. What if I do not convert into shares in September 2013 at the latest?
The nominal amount of the convertible bonds will be repaid on 15 January 2014 together with accrued interest unless conversion or repayment has occured prior to this date.
10. What is the practical conversion procedure if I would like to convert to shares?
The holders of PA Resources convertible have the right to claim conversion into new shares during the period 1-30 September every year, the last time in 2013. In due time before each conversion period, you will be able to find detailed instructions on this web site for how you should do the conversion into shares.
11. How are convertibles in a pledged deposit handled?
Pledged convertibles require the pledge’s signature on the application form.
12. Is the convertible listed and traded?
Yes, you can trade the convertible on NASDAQ OMX Nordic in Stockholm (PAR KV1).
13. If I buy or sell convertibles how is the accrued interest calculated?
If you buy convertibles you have to pay the accrued interest and if you sell you will receive accrued interest. The accrued interest is calculated on a nominal amount from 15 January the current year until the day of settlement and specified separately on the transaction note. The accrued interest is not included in the convertible’s price.
14. If the convertible increases in value will I receive more shares?
No, you will not receive the value increase in shares. The nominal amount and the number of shares are indifferent to the amount and number you bought. You can favor from the value increase by 1) trading your convertibles or 2) converting into shares and thereafter sell your shares.
15. What affects the convertibles price?
The convertible’s price is just like the share price affected by a number of factor. The price is mainly influenced by the share price since the conversion price (SEK 3,245 from April 2013) is set in advance. In addition the convertible’s price is also affected by the convertible’s interest rate compared with the current interest level.
16. What happens if a takeover bid is made on PA Resources?
After the company gives notice of a change in the ownership structure the claimant has the right to claim conversion in accordance with the terms for the convertible bond. For additional information see § 4 (g) and § 5 (a) - Terms and conditions for PA Resources convertible bond 2008/2014.