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China’s Founder fails to make short-term commercial paper payment
By Sarah Lizee
Olympia, Wash., Dec. 5 – Founder Information (Hong Kong) Ltd. said that it failed to pay the principal amount and interest of the super short-term commercial paper due on Dec. 2 due to a liquidity issue.
There is a 15-day grade period, and therefore the nonpayment has not triggered any cross-default under the $490 million of 6¼% bonds due 2020 or $310 million of floating-rate bonds due 2021 issued by Kunzhi Ltd.
If the payment is made in full within the grace period, the delay in repayment will not result in a cross-default under the bonds.
Founder said it is “actively raising funds through various channels and strengthening its business operation” in order to make the payment within the grace period.
Founder Information is the guarantor of the bonds. Peking University Founder Group Co. Ltd. provides a keepwell deed and a deed of equity interest purchase undertaking for the bonds.
Founder is a technology conglomerate based in Beijing.
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