Decision on early repayment of outstanding installment obligations resulting from Netia’s arrangement proceedings
WARSAW, Poland – November 8, 2004 – Netia SA (“Netia” or the “Company”) (WSE: NET), Poland’s largest alternative provider of fixed-line telecommunications services, announced that its Management and Supervisory Boards resolved today on the early repayment of all of the Company’s outstanding installment obligations resulting from the arrangements approved in 2002 in the arrangement proceedings for Netia Holdings S.A., Netia Telekom S.A., and Netia South Sp. z o.o. (ref: XVII Ukł 27/02, XVII Ukł 28/02 and XVII Ukł 52/02, respectively, in the proceedings conducted by the District Court for the City of Warsaw in Warsaw, XVII Commercial Division), having a total value of PLN 11,872,036 (“Installment Obligations”), on or before the end of the second quarter of 2005, i.e. prior to the maturity of the Installment Obligations set for until 2012. Repayment of all the Installment Obligations will permit completion of the above referenced arrangement proceedings.
The Company anticipates that the Installment Obligations will be repaid as follows:
- through cash payments to the accounts designated by those Company creditors who can prove that they are entitled to the Installment Obligations (the “Entitled Creditors”);
- the Entitled Creditors shall also be able to exchange their Installment Obligations for new Company shares (the “Shares”) which will be issued at the price of PLN 1.0826241 per share, i.e. for the price equal to the issue price of the series H shares issued in relation to the Company’s financial restructuring in 2002; the Company plans to issue a total of no more than 18,373,785 Shares; the Shares will be issued on the basis of paragraph 5a of the Company statute (authorised capital) and subscription for the Shares will end on 12 March 2005;
- a cash amount equivalent to the Installment Obligations due to those Entitled Creditors who do not request the Company to satisfy the Installment Obligations pursuant to either point (i) or (ii) above, shall be deposited with the court depository.
By December 31, 2004, the Management Board will announce detailed information relating to the terms and conditions of repayment of the Installment Obligations. Detailed information on the exchange of Installment Obligations for Shares shall be announced in the first quarter of 2005 after the Company publishes a prospectus, in accordance with the relevant provisions of Polish law.