Agreement with Broadband & Wireless Pty Ltd 3/12/02 4:52:00 PM
NEW TEL LIMITED 2002-12-03 ASX-SIGNAL-G
HOMEX - Perth
+++++++++++++++++++++++++ New Tel Limited (New Tel or Company) is pleased to announce that it has entered into an agreement with Broadband & Wireless Pty Limited (BWPL) pursuant to which BWPL has agreed to the terms upon which the Company will repay to BWPL approximately $22,000,000 of debt which is to be acquired by BWPL from Telstra and Optus (BWPL Agreement).
HISTORY
On 15 November 2002, BWPL entered into an agreement with Optus Networks Pty Ltd and Optus Mobile Pty Ltd (together, Optus) pursuant to which Optus agreed to assign to BWPL the aggregate current balance of debts owing by New Tel to Optus, totalling $11,284,967.13.
On 21 November 2002, Broadband & Wireless Limited (BWL) entered into an agreement with Telstra Corporation Limited (Telstra) pursuant to which Telstra agreed in principle to assign all debts owed to Telstra by New Tel, totalling approximately $11,000,000.
BWPL is a wholly owned subsidiary of BWL. It is intended that BWPL will, as BWL's nominee, enter into a formal binding agreement with Telstra pursuant to which BWPL will be assigned the Telstra Debt (Telstra Agreement).
BWPL AGREEMENT
The material terms of the BWPL Agreement are as follows:
1. During the 90 days following the date of the BWPL Agreement, New Tel must progressively make payments to BWPL up to an aggregate sum of $10,000,000 (Repayment Amount) - BWPL has agreed to accept the Repayment Amount in full and final satisfaction of all but $3,218,046.39 of the total debt outstanding to BWPL (Total Debt).
2. The balance of the Total Debt, being $3,218,046.39 (Debt Balance), will be repaid by BWPL applying the Debt Balance in subscription for fully paid ordinary shares in the capital of the Company (Shares) at an issue price of $0.01 per Share, subject to the approval of New Tel shareholders in the general meeting.
The Repayment Amount will be funded by New Tel as follows:
(a) approximately $7,000,000 of the Repayment Amount will be funded from New Tel's current receivables; and
(b) approximately $3,000,000 of the Repayment Amount will be funded pursuant to loans made to New Tel by certain third party investors (Investors). The terms of the loans from the Investors provide that the funds advanced to New Tel will be converted into Shares at an issue price of $0.01 per Share, subject to the approval of New Tel shareholders.
PROPOSED RIGHTS ISSUE
In order to allow all New Tel shareholders to participate in a capital raising by the Company at the same price at which BWPL and the Investors will be issued Shares on conversion of their respective debts, the Board of New Tel is pleased to announce that the Company intends to proceed with a one (1) for one (1) non-renounceable pro rata rights issue ofShares at a issue price of $0.01 per Share (Rights Issue). It is anticipated that a prospectus for the Rights Issue will be lodged with the ASIC towards the end of January 2003, with the record date for the Rights Issue to occur 7 business days later.
BWPL and the Investors will not participate in the Rights Issue.
A proforma capital structure of the Company on completion of the transactions set out above is attached to this announcement.
ADDITIONAL MATTERS
The transactions contemplated by the BWPL Agreement are subject to and conditional upon:
(a) New Tel and BWPL obtaining all required approvals to enter into the BWPL Agreement and complying in all respects with all relevant laws and regulations; and
(b) within 21 days of the date of the BWL Agreement, BWPL entering into the Telstra Agreement with Telstra.
Further details in relation to the transactions with BWPL and the Investors will be set out in the notice of meeting and explanatory statement to be sent to shareholders for the purposes of obtaining approval to convert the debts outstanding to BWPL and the Investors into Shares.
New Tel has been advised by Australian Stock Exchange Limited (ASX) that the Company's securities will not be reinstated to trading on ASX until such time as:
(a) the Company's audited accounts have been lodged with the ASIC and ASX; and
(b) shareholder approval has been obtained for the conversion of the debts owed to BWPL and the Investors into Shares.
Tbe Board is confident that each of the matters referred to above will be completed prior to 28 February 2003.
P Malone CHIEF EXECUTIVE OFFICER
CAPITAL STRUCTURE OF NEW TEL
SHARES OPTIONS
Current 297,637,187 271,088,737
Maximum Shares to be issued 297,637,187 - pursuant to Rights Issue
Issued to BWPL* 321,804,639 -
Issued to Investors* 300,000,000 -
MAXIMUM TOTAL AFTER 1,217,079,013 271,088,737 RIGHTS ISSUE
