Beijing, China
December 30, 2009
Origin Agritech Limited (NASDAQ: SEED) (“Origin” or the “Company”) today announced that it completed its Second Notes Repurchase Agreement (the “Agreement”) as of December 30, 2009 with Citadel Equity Fund Ltd. (“Citadel”) of the remaining portion of the Company’s outstanding 1% Guaranteed Senior Secured Convertible Notes due 2012 (the “Notes”) by full repayment in cash of the agreed upon purchase price due to Citadel.
Liang Yuan, Chief Executive Officer of Origin Agritech, stated, “Origin has never been in a stronger position strategically, technologically, and, most appropriately, financially, in this situation. We are repurchasing our notes based on this strength. Our current cash receipts from this FY 2010 selling season are again the highest in our history, and this should continue to be evident in the first quarters on our balance sheet. We repaid our debt to eliminate any possible dilution and demonstrate our upcoming confidence in the near term future.”
The Company issued the Notes to Citadel in an aggregate principle amount of US$40 million in June 2007, and repurchased $23.4 million in principle of those notes in July 2008 and January 2009. This composes the last tranche of the aggregate principle amount of the remaining US$16.6 million, for a repurchase price of US$104,000 for each principal amount of US$100,000 of such Notes. These repurchased notes have been cancelled.
This Note repurchase provides the Company with the opportunity to eliminate expensive debt on our balance sheet, receive favorable financial terms, and limits company liability going forward in light the current global capital market conditions, which should provide the company with significant flexibility for future growth and capital opportunities.
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