Stock exchange release from Westend ICT Plc, April 9, 2010, at 12.30 Finnish
time
WESTEND ICT PLC HAS AGREED ON A SIGNIFICANT FINANCING ARRANGEMENT
Westend ICT Plc has today agreed on financing arrangements with the company's
main owners Tuomo Tilman and Jyrki Salminen that will significantly improve the
company's financial position (later referred to as “Arrangement”). The
Arrangement will consist of four separate judicial actions: (i) Loan instalment,
(ii) sale of stocks, (iii) converting a convertible bond into stocks in the
company, and (iv) a directed issue. The Arrangement's coming into force is
subject to the Arrangement's approval by an Extraordinary General Meeting that
will convene on May 4, 2010.
Primary contents of the Arrangement:
Loan instalment; the company will pay a total of EUR 501,686.20 in loan
instalments;
Sale of stocks; the company will sell 1,999,357 of Group Business Software AG's
stocks in its possession for a total price of EUR 1,199,614.20;
Conversion of convertible bonds; EUR 2,356,000 of the company's convertible
bonds will be converted into 15,078,400 of the company's new stocks, and
A directed issue; the company will hold a directed issue where a total of
32,000,000 new stocks will be offered for subscription for a total subscription
price of EUR 1,600,000.
A more detailed description of the Arrangement can be found in the company's
notice of an Extraordinary General Meeting to be released today.
Effects of the Arrangement on the company:
Effect on balance sheet
The Arrangement will fix the company's equity into positive. The company's
equity will be directly strengthened by EUR 3,956,000.00 and by EUR 319,897.12
through sales profit from the Group Business Software AG stocks via returns,
i.e. by a total of EUR 4,275,897.12 compared to the approved financial statement
of December 31, 2009. The company's (parent company) equity will rise to EUR
3,122,635.12. The equity will cover the company's share capital of EUR
2,569,854.92. The company will have the prerequisites for removing the entry
about losing share capital from the trade register.
Effect on returns
The company will mark a one-time sales profit of EUR 319,897.12 to be marked
under other business profits in the returns for Q2/2010.
The sales price for the stocks and the subscription price for the stock issue
will be paid against receivables from the company. After this, the company will
be free from debt; the company has no outstanding loans with interest or
otherwise. The removal of financing costs will have a positive effect of
approximately EUR 140,000.00 on the company's 2010 returns compared to the year
2009.
Effect on funds
In total, the Arrangement will reduce the company's funds by approximately EUR
360,000.00 in 2010. The effect on funds is comprised of the margin between the
EUR 500,000 loan instalment and the EUR 140,000 reduction in financing costs.
Effect on company ownership
As part of the Arrangement, the company will issue a total of 47,078,400 new
stocks based on the conversion of convertible bonds and a directed issue,
bringing the total number of the company's stocks to 175,571,096. After the
Arrangement, the share of Tuomo Tilman and his authorized company in the company
will be approximately 32.88% and Jyrki Salminen's share will be approximately
31.30%.
In ruling number 3/214/2010, issued on April 9, 2010, the Financial Supervisory
Authority has granted Tuomo Tilman and Jyrki Salminen exceptions from the offer
brief defined in Chapter 6, Section 10 of the Securities Markets Act, allowing
Tilman's and Salminen's ownership shares of all company share votes to exceed
3/10 without an offer brief for all other stocks of the company. The conditions
for the ruling to remain valid are that (i) the applicants will not act together
as described by the Chapter 6, Section 10 of the Securities Markets Act in order
to gain control of Westend ICT Plc and (ii) that the applicants will not acquire
or subscribe to any more Westend ICT Plc stocks or in other ways increase their
share of votes in Westend ICT Plc.
Effect on the company's business activities
The Arrangement will create a basis for developing the company's business
activities and the opportunity to take part in mergers.
Espoo, April 9, 2010
Westend ICT PLC
BOARD OF DIRECTORS
For further information:
CEO Hannu Jokela
Tel. +358 207 91 6700
hannu.jokela@westendict.com
Distribution:
NASDAQ OMX Helsinki Ltd
Main media
www.westendict.com