Rights Issue
Given the lag in revenue performance of the Company over the period, and the resulting interim loss for the first half of the 2007 year, the Board has taken the prudent step of resolving to undertake a non-renounceable Rights Issue to raise a maximum of $2.4 million (GBP 0.967 million) (the "Rights Issue") on the basis of 1 New Ordinary Share at a price of 28 cents per New Ordinary Share and one bonus New Ordinary Share for every 20 Existing Ordinary Shares held at the record date. The Rights Issue Price of 28 cents per New Ordinary Share represents a premium of approximately 44 per cent. to the closing price per Existing Ordinary Share of 19.5 cents on 27 February 2007, the last business day before the announcement of the Rights Issue.
An underwriting agreement has been entered into with UXC Limited, a substantial shareholder of the Company. UXC Limited have agreed to underwrite the Rights Issue up to $2.05 million (GBP 0.826 million) and will hold 17.3% of the ordinary issued shares of the Company should no subscriptions be received. An underwriting fee of 5% of the amount raised under the Rights Issue is payable to UXC Limited on completion. The underwriting agreement contains a loan facility whereby the Company is able to draw down on an advance of up to $1.2m of the rights proceeds at 12% interest per annum until completion of the rights issue.
The directors intend to use the net proceeds of the rights issue for working capital purposes.
The proposed timetable for the Rights Issue is as follows:
"Ex" date to be advised
Record date for determining rights under Rights Issue to be advised
Lodgement Date - Prospectus lodged with ASIC by 30 May 2007
Opening Date 15 June 2007
Closing Date 16 July 2007
Shortfall Notification Date 20 July 2007
Shortfall Settlement Date 24 July 2007
Issue Date 25 July 2007
Shares admitted to trading on AIM 31 July 2007
The above dates may vary provided that the Lodgement Date is no later than 30 May 2007.
The Board of IT&e wishes to advise that it has considered the costs of complying with the relevant legal and regulatory requirements to extend the Rights Issue outside of Australia and New Zealand (in particular, to existing shareholders in the United Kingdom) and regrets to advise that it is unable to extend the Rights Issue to shareholders outside of Australia and New Zealand at reasonable cost having regard to the number of shareholders outside of Australia and New Zealand, the number and value of the securities to be offered to shareholders outside of Australia and New Zealand; and the cost of complying with the legal requirements and requirements of regulatory authorities in the overseas jurisdictions.
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