SUBORDINATED LOAN
RCL Group Limited (ASX:RLG) provides the following update to the market in respect to the rollover of the Babcock & Brown International Pty Limited (Babcock & Brown) subordinated corporate loan.
In ASX releases dated 2 August 2010 and 30 August 2010, RLG advised that it had received a letter of confirmation from Babcock & Brown that it was prepared to rollover its subordinated corporate debt until December 2012 on the same terms and conditions that are currently in place. However, RLG has received notification from Babcock & Brown?s legal advisors, purporting to withdraw this letter of confirmation on the basis of alleged breaches by RLG of its loan arrangements with Babcock & Brown which allegedly arise as a result of the arrangements to extend RLG?s maturing senior corporate and project debt facilities being entered into on 2 August 2010. RLG rejects these allegations and is consulting with its legal advisers in relation to this matter.
RLG confirms that the Babcock & Brown corporate loan is fully subordinated to the senior corporate loan and cannot be called for repayment without the consent of the senior corporate lender. In addition, the loan does not provide for the charging of a default rate of interest.
RLG will ensure that the market is properly informed as this matter progresses.link in rlg annoucements
BNB
babcock & brown limited
