SR Telecom announces the expiration of its 8.15% Debentures Exchange Offer
19 Août 2005 - 6:34PM
PR Newswire (US)
MONTREAL, Aug. 19 /PRNewswire-FirstCall/ -- SR Telecom Inc. (TSX:
SRX; Nasdaq: SRXA) announced the expiration of its offer to
exchange its outstanding CDN$71 million 8.15% debentures due August
31, 2005 (the "8.15% Debentures") and accrued interest thereon of
approximately CDN$4.8 million into new 10% Secured Convertible
Debentures due October 15, 2011 (the "10% Secured Convertible
Debentures"). The offer expired at 5:00 p.m., Eastern Time, on
August 18, 2005. The exchange offer occurred as part of the
Corporation's recapitalization plan, announced in May 2005. At that
time, SR Telecom closed an operating credit facility of USD$39.6
million with certain holders of its 8.15% Debentures, including
certain funds and accounts managed by DDJ Capital Management, LLC.
In addition, Inter-American Development Bank and Export Development
Canada agreed to restructure the terms of the loans to SR Telecom's
Chilean subsidiary, Comunicacion rurales y telefonia, and postpone
maturity for three years from the date of the implementation of the
restructuring. SR Telecom was pleased to announce that, pursuant to
the exchange offer, CDN$70.5 million in principal amount of the
8.15% Debentures were tendered, representing approximately 99.3% of
the outstanding 8.15% Debentures. In exchange, the Corporation will
issue CDN$75.3 million of 10% Secured Convertible Debentures to
those holders of 8.15% Debentures who tendered at the closing on
account of principal and interest. Funds and accounts managed by
DDJ Capital Management, LLC will hold approximately 33% of the
outstanding 10% Secured Convertible Debentures upon consummation of
the exchange offer. In addition, under the exchange offer, SR
Telecom received the required consents to amend the terms of the
8.15% Debentures to, among other things, extend the maturity
thereof to coincide with the maturity date of the 10% Secured
Convertible Debentures and remove certain covenants. Holders of
8.15% Debentures who did not tender under the exchange offer will
continue to hold such debentures. Interest on the 10% Secured
Convertible Debentures is payable in cash or in kind by the
issuance of additional 10% Secured Convertible Debentures, at the
option of SR Telecom. The 10% Secured Convertible Debentures will
be convertible into common shares at a rate of approximately 4,606
common shares per CDN$1,000 in principal amount of 10% Secured
Convertible Debentures representing a conversion price at closing
of approximately $0.217 per common share such that the outstanding
principal amount of all 10% Secured Convertible Debentures are
convertible into 95.2% of the fully diluted common shares of the
Corporation upon closing of the exchange offer. On the earlier of
the business day following the record date for a rights offering
being contemplated by the Corporation and November 30, 2005, CDN$10
million in principal amount of the 10% Secured Convertible
Debentures will be converted into approximately 46,060,892 common
shares of the Corporation, and immediately after the issuance,
those holders of 10% Secured Convertible Debentures that were
converted will hold approximately 72% of the common shares of the
Corporation on an undiluted basis. The exchange offer was launched
on July 21, 2005 and was subject to terms and conditions set forth
in a private offering memorandum and consent solicitation statement
sent to holders of 8.15% debentures. As all conditions of the
exchange offer have been met, the closing of the exchange offer is
expected to take place on or after August 22, 2005, upon completion
of all regulatory filings. This press release is not an offer of
securities for sale in the United States. Securities may not be
offered or sold in the United States in the absence of registration
or an exemption from registration. Any public offering in the
United States will be made by means of a prospectus that may be
obtained from SR Telecom, and that will contain detailed
information about the Corporation and management, as well as
financial statements. About SR Telecom SR TELECOM (TSX: SRX,
Nasdaq: SRXA) designs, manufactures and deploys versatile,
Broadband Fixed Wireless Access solutions. For over two decades,
carriers have used SR Telecom's products to provide field-proven
data and carrier-class voice services to end-users in both urban
and remote areas around the globe. SR Telecom's products have
helped to connect millions of people throughout the world. A
pioneer in the industry, SR Telecom works closely with carriers to
ensure that its broadband wireless access solutions directly
respond to evolving customer needs. Its turnkey solutions include
equipment, network planning, project management, installation and
maintenance. SR Telecom is a principal member of WiMAX Forum, a
cooperative industry initiative which promotes the deployment of
broadband wireless access networks by using a global standard and
certifying interoperability of products and technologies. About DDJ
Capital Management, LLC DDJ Capital Management, LLC is a boutique
investment manager specializing in private equity and debt
financings, as well as high yield and special situations investing.
Founded in 1996, the Wellesley, Massachusetts based investment firm
currently manages approximately $3 billion on behalf of 78
institutional clients. FORWARD-LOOKING STATEMENTS Except for
historical information provided herein, this press release may
contain information and statements of a forward- looking nature
concerning the future performance, financial condition and
financing plans of the Corporation. These statements are based on
suppositions and uncertainties as well as on management's best
possible evaluation of future events. Such factors may include,
without excluding other considerations, fluctuations in quarterly
results, evolution in customer demand for the Corporation's
products and services, the impact of price pressures exerted by
competitors, and general market trends or economic changes. As a
result, readers are advised that all of the forward-looking
statements in this news release are qualified by these cautionary
statements and actual results or developments may differ from
expected results or developments and that such differences may be
significant. The Corporation expressly disclaims any obligation to
update any forward-looking information. SR TELECOM is a trademark
of SR Telecom Inc. All rights reserved 2005. All other trademarks
are property of their owners. DATASOURCE: SR TELECOM INC. CONTACT:
Mr. William E. Aziz, Interim President and CEO, (514) 335-2429
Ext.4613
Copyright