Tiscali 2009 Annual Report Download - page 27

Tiscali Group: Annual Report 2009
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e) Third increase: increase in share capital for a maximum amount of EUR 25 million, delegated to
the Board of Directors, whose subscription was also to be guaranteed by Senior Lenders, to be
carried out within three years from the resolution, in one or more tranches, aimed at repaying
another portion of Senior Debt, upon the occurrence of given conditions.
4) Finally, contractual terms were renegotiated regarding financing of the Sale and Lease Back of the
Cagliari registered office building.
The Framework Agreement approved by the Board of Directors was subject to the occurrence of certain
conditions, including:
• the resolution by the Shareholders’ Meeting of the above-mentioned share capital increases together
with subscription agreements from Senior Lenders;
• Consob certification of the exemption from execution of the obligatory Public Offer (so-called exemption
from bail-out) provided under article 49, paragraph 1, letters b) and d) of Consob regulation no.
11971/99 (Issuers Regulation) in relation to the restructuring of debt and the execution of the above-
mentioned share capital increases;
• verification of a restructuring plan by an independent expert pursuant to article 67, paragraph 3, letter
d) of Royal Decree no. 267 of 16 March 1942;
• the completion of the sale of Tiscali UK to the Carphone Warehouse Group, with prior receipt of
authorisation from the EURpean Antitrust Authority.
•
Activities carried out at the date of preparation of the 2009 Financial Statements, as part of
implementation of the Restructuring Plan and the Framework Agreement
1) On 26 May, Tiscali completed the sale of the Ti Net Group, IP transit service provider, to the BS private
equity fund. The transaction valued Ti Net at an Enterprise Value of roughly EUR 47 million, including a
potential earn out of around EUR 7 million. The Equity Value, net of debt, was approximately EUR 35 million.
Based on the Group’s debt restructuring agreements, net revenue from the sale of Ti Net was retained in the
company’s cash balance to service working capital requirements, also through recapitalisation of the Italian
subsidiary.
2) On 30 June 2009 the Extraordinary Shareholders’ Meeting, in third call, approved the following
provisions:
• Elimination of the nominal value of shares and reverse split of said shares at a ratio of 1 share for every
10 existing shares, to be carried out with the prior resolution of the company’s Board of Directors;
• Reduction of share capital for losses, pursuant to article 2446 of the Italian Civil Code. Following said
resolution, share capital fell to roughly EUR 156.1 million;
• The share capital increase through payment pursuant to article 2441, paragraph 1 of the Italian Civil
Code up to a maximum of EUR 190 million through the issue of ordinary no-par value shares, with
warrants allocated free of charge, at a price of EUR 0.01 (EUR 0.1 post-reverse split) per share (First
increase);
• The share capital increase pursuant to article 2441, paragraph 1 of the Italian Civil Code up to a
maximum amount of EUR 46.5 million through the issue of ordinary no-par value shares, at a price of
EUR 0.01 (EUR 0.1 post-reverse split) per share (Second increase);
• Delegation to the Board of Directors pursuant to article 2443, paragraph 2 of the Italian Civil Code, to
increase share capital through payment in accordance with article 2441, paragraph 1 of the Italian
Civil Code, in one or more tranches, for a maximum period of three years from the delegation decision,
up to a maximum amount of EUR 25 million, through the issue of ordinary no-par value shares (Third
increase).