CREDITO VALTELLINESE CONVERTIBLE SUBORDINATE BOND ISSUE IN EURO
In the 90th year since the bank foundation, Credito Valtellinese's Board of Directors is submitting the following suggestions to the General meeting, called on April next:
share nominal value conversion from 5,000 lire to 3 Euro, through the revenue reserves utilization. The conversion is subject to Italy's joining the third phase of the European Monetary Union. The operation is involving a change in art. 7 of Credito Valtellinese's Articles of association and will enter into effect as from February 1 1999.
Subordinate, partially convertible bond issue cum warrants involving issue of one bond, worth 1,000 Euro, every 300 outstanding shares for a maximum amount of 143,418,000 Euro. Repayment will be annual, deferred and index-linked. The index-linking parameters will be fixed on February 1 1999, when bonds are issued, taking into account the market conditions.
Each bond will be combined with eighty warrants, forty of which can be exercised (a warrant each new share at six Euro) from February 1 2000 to May 1 2000, and the other forty from February 1 2001 to May 1 2001.
The bond issue will last five years and will be repaid by three instalments, which falls due respectively three, four and five years after the issue.
At each due date (300 Euro for the first and the second instalment; 400 Euro for the third instalment), the bondholders can convert half the bonds that fall due into 24, 23 and 29 new shares (for the first, second and third instalment respectively) and be repaid the other half. Otherwise, they can ask for repayment of all of the bonds.
A capital increase through issue of 22,373,208 new shares will be suggested to support the bond issue cum warrants.
The above-mentioned transaction is subject to the Bank of Italy's permit.
