MUMBAI: Worldspace satellite radio has secured a $40 million financing facility from Yenura Pte.

The company secured a waiver of certain pre-payment obligations owed to the holders of its existing debt.

The facility supports the company's preparations for the launch of its European mobile service in the Italian market and business development activities in selected markets. However, Worldspace will continue to seek to secure additional financing from a variety of sources, including existing and new investors.
Under the terms of the agreement, Worldspace must draw down the money on or before 31 January.

For every draw down, Worldspace will issue a subordinated convertible note with an eight per cent annual interest rate. The interest will be paid in arrears as additional principal, not cash.

The notes will have a five-year maturity period from the issuance date of the first note, but can be converted into Worldspace's Class A common share at $4.25 a share.

Yenura is a special-purpose entity created to invest in Worldspace. It is controlled by Noah Samara, the chairman and chief executive of Worldspace.