Nortel Inversora S.A. Announces Redemption of Notes.
BUENOS AIRES, Argentina--(BUSINESS WIRE)--March 22, 2000
Nortel Inversora S.A. ("Nortel") (NYSE: NRT), announced today that it will redeem its 10% Mandatorily Exchangeable Debt Securities due 2000 (the "MEDS") on April 16, 2000. The MEDS were issued pursuant to an indenture dated as of April 2, 1996 among the Company and First Trust of New York, National Association, as successor Trustee to Morgan Guaranty Trust Company of New York.
Each MEDS will be redeemable for 1.7392 ADSs, or 8.696 Class B Shares of Telecom Argentina STET-France Telecom S.A. ("Telecom"). This amount represents the Exchange Ratio set forth in the indenture governing the MEDS, adjusted to reflect the change in Telecom's ADS ratio from 10 Class B Shares per ADS to five Class B Shares per ADS, effective August 28, 1997.
The Paying Agent for the MEDS is U.S. Bank Trust, National Association.
A copy of the form of notice of early redemption, which is being mailed to holders of MEDS today, is attached hereto.
NOTICE OF EARLY REDEMPTION
NORTEL INVERSORA S.A.
10% Mandatorily Exchangeable Debt Securities due 2000
CUSIP No.: 656567302
Nortel Inversora S.A. (the "Company") hereby notifies holders of the Company's 10% Mandatorily Exchangeable Debt Securities due 2000 (the "MEDS") issued pursuant to an indenture dated as of April 2, 1996 among the Company and First Trust of New York, National Association, as successor Trustee to Morgan Guaranty Trust Company of New York thereunder (the "Indenture"), of its election to redeem all of the outstanding MEDS. Any capitalized terms used but not defined in this notice shall have the meanings assigned in the Indenture.
The Redemption Date will be April 16, 2000.
Each MEDS will be redeemable for 1.7392 ADSs, or 8.696 Class B Shares, of Telecom Argentina STET-France Telecom S.A. ("Telecom"). The amount of accrued and unpaid interest to be paid on each MEDS to be redeemed is US$0.01167.
A Holder may elect to receive Class B Shares instead of ADSs by sending a written election notice to the Company within five Business Days following the date of this notice.
On the Redemption Date, for each MEDS redeemed, Holders of the MEDS are entitled to receive a number of ADSs equal to the greater of (1) the Exchange Ratio and (2) the applicable Call Price divided by the Current Market Price as of the second Trading Day immediately preceding the Notice Date. The Exchange Ratio (adjusted to reflect the change in Telecom's ADS ratio from 10 Class B Shares per ADS to five Class B Shares per ADS, effective August 28, 1997) is 1.7392 ADSs or 8.696 Class B Shares per MEDS. The Call Price is $43.06167 per MEDS, which represents the sum of (i) US$42.00 plus a redemption premium equal to US$1.050, and (ii) US$0.01167, representing all accrued and unpaid interest per MEDS up to but not including April 16, 2000. The Current Market Price is $81.75 per Telecom ADS, representing the closing sale price per ADS on March 3, 2000. The MEDS must be surrendered to the Paying Agent to collect the interest and the ADSs and Class B Shares due thereon.
Unless the Company defaults in making the redemption payment of interest and ADSs and Class B Shares deliverable upon call for redemption in accordance with the Indenture, interest on the MEDS called for redemption will cease to accrue on and after the Redemption Date, and the only remaining right of the Holders of such MEDS is to receive payment of accrued interest to the Redemption Date and the number of ADSs and Class B Shares per MEDS described herein upon surrender to the Paying Agent of the MEDS redeemed.
The Paying Agent for the MEDS is U.S. Bank Trust, National Association. Interest and ADSs due on the MEDS called for redemption will become due and payable on the Redemption Date upon presentation and surrender thereof in the following manner:
If by Mail: (REGISTERED BONDS) U.S. Bank Trust National Association Corporate Trust Services P.O. Box 64111 St. Paul, MN 55164B0111 (612) 973-5800
If by Hand or Overnight Mail: U.S. Bank Trust National Association
180 East Fifth Street 4th Floor - Bond Drop Window
St. Paul, MN 55101 (612) 973-5800
By FIRST TRUST NEW YORK NATIONAL ASSOCIATION
Notice Date: March 7, 2000
IMPORTANT TAX INFORMATION
A holder of MEDS who receives cash in lieu of fractional shares of ADSs or Class B shares may be subject, under certain circumstances, to backup withholding at a 31% rate with respect to such cash received unless the Holder provides proof of an applicable exemption or a correct taxpayer identification number and otherwise complies with the applicable requirements of the backup withholding rules. Any amounts withheld under the backup withholding rules are not an additional tax and may be refunded or credited against a Holders United States Federal Income Tax liability, provided the required information is furnished to the IRS.
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|Date:||Mar 22, 2000|
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