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TZ LIMITED — Capital/Financing Update 2010
Dec 23, 2010
65975_rns_2010-12-23_8e2d5ac8-d29b-443f-b2b1-6a2e78c02cad.pdf
Capital/Financing Update
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TZ Limited ABN 26 073 979 272
==> picture [134 x 56] intentionally omitted <==
24 December 2010
Lodged by ASX Online
The Manager Company Announcements Office ASX Ltd. Level 4, 20 Bridge Street Sydney, NSW 2000
Dear Sir/Madam
ISSUE OF SERIES IIIB CONVERTIBLE NOTES AND OPTIONS
Issue of Series IIIB Convertible Notes
TZ Limited (the "Company" ) advises that it has today issued a total of 4,275 secured convertible notes (the "Series IIIB Convertible Notes" ), each with a face value of $1,000, to QVT Fund LP and Quintessence Fund L.P. ( "QVT Funds" ), as follows:
-
3,847 Series IIIB Convertible Notes to QVT Fund LP; and
-
428 Series IIIB Convertible Notes to Quintessence Fund L.P..
The issue of the Series IIIB Convertible Notes was approved by the Company's shareholders under resolution 5 passed at the 2010 annual general meeting of the Company held on 17 November 2010 (the "2010 AGM" ). The Series IIIB Convertible Notes were issued in repayment of all outstanding principal and interest owing under the loan facility (the "Loan Facility" ) between the QVT Funds, the Company and the Company's wholly owned subsidiary, Telezygology Inc. ( "TZ Inc" ) pursuant to which the QVT Funds lent US$4,100,000 to TZ Inc. Accordingly, TZ Inc's obligation to repay all principal and interest owing under the Loan Facility has been fully satisfied by the issue of the Series IIIB Convertible Notes.
The Series IIIB Convertible Notes are secured by the first ranking fixed and floating charge dated 13 July 2010 granted by the Company over all of the assets of the Company (other than the Company's shares in its subsidiaries Product Design Technologies Inc. and PDT Holdings Inc.).
The key terms of the Series IIIB Convertible Notes are as follows:
o The face value of each Series IIIB Convertible Note is $1,000.
Chicago (Operational Headquarters) ASX: TZL 520 West Erie Street, Suite 100 Web: www.tz.net Chicago, IL 60654 United States Email: [email protected]
Sydney (Registered Office) Level 11, 1 Chifley Square Sydney, NSW 2000 Australia
ASX Announcement
==> picture [33 x 38] intentionally omitted <==
-
Interest accrues on each Series IIIB Convertible Note at 10% per annum, calculated on the outstanding principal amount and payable annually in arrears on 31 December each year.
-
The Series IIIB Convertible Notes must be repaid on 24 December 2015 (the “Series IIIB Maturity Date” ), unless converted into ordinary fully paid shares in the Company ( "Shares" ).
-
The Series IIIB Convertible Notes may be converted during the period commencing on the date of their issue up to and including the Maturity Date (the “Series IIIB Conversion Period” ).
-
The conversion price (the “Series IIIB Conversion Price” ) for each Series IIIB Convertible Note is the lesser of 42 cents and the lowest price at which Shares may be subsequently issued by the Company while the Series IIIB Convertible Notes remain on issue.
-
The QVT Funds may elect to convert any of the Series IIIB Convertible Notes into Shares during the Series IIIB Conversion Period by giving an irrevocable conversion notice. The Company is required to convert each Series IIIB Convertible Note into a specified number of Shares ( “Share Equivalent” ) determined under the formula for calculating the Share Equivalent as set out below. Additionally, the Series IIIB Convertible Notes may be converted into the Share Equivalent on the occurrence of customary events of default (including insolvency events, default by the Company, change of control and certain material adverse events).
-
The Share Equivalent is equal to the number of Shares calculated in accordance with the following formula:
Number of Shares = VN + I CP where: VN = Face Value of the outstanding Series IIIB Convertible Notes I = Interest accrued but unpaid on the outstanding Convertible Notes CP = Series IIIB Conversion Price (which at the date of issue is $0.42)
Page 2 of 4
ASX Announcement
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Issue of Options
The Company further advises that it has today issued 3,000,000 options to subscribe for Shares at an exercise price of $0.42 (the "Options" ) as follows:
-
2,704,625 Options to QVT Fund LP; and
-
295,375 Options to Quintessence Fund L.P..
The issue of the Options to the QVT Funds was approved by the shareholders of the Company under resolution 6 passed at the 2010 AGM.
The key terms of the Options are as follows:
-
Each Option entitles the holder, when exercised, to subscribe for one Share, subject to adjustment as set out below.
-
The exercise price to convert each Option into Shares is $0.42 (the “Option Price” ).
-
The Options expire on 19 February 2013 ( "Expiry Date" ).
-
The Options are exercisable at any time during the period from their date of issue to the Expiry Date in multiples of one thousand Options by the QVT Funds completing an exercise notice and paying the Option Price.
-
The Options will not be listed on the Australian Securities Exchange.
-
All Shares issued upon exercise of the Options will rank pari passu with all other Shares in all respects.
-
There are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to shareholders in the Company prior to the Options being exercised through its ownership of the Options other than pursuant to any applicable anti-dilution provision applying to the Options.
-
If the Company makes a pro rata issue (except a bonus issue) to the holders of Shares, the Option Price will be reduced in accordance with the formula contained in Listing Rule 6.22.2 and 6.22.2A of the ASX Listing Rules.
-
If the Company makes a bonus issue to the holders of Shares, the number of Shares over which each Option is exercisable will be increased in accordance with Listing Rule 6.22.3 of the ASX Listing Rules.
Page 3 of 4
ASX Announcement
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- If the Company reorganises its capital (including by consolidation, sub-division, reduction, cancellation or return) the Options will be reorganised and the Company’s rights will change to the extent necessary to comply with the ASX Listing Rules applying to a reorganisation of capital at the time of the reorganisation.
Appendix 3B
An Appendix 3B is attached in respect of the Series IIIB Convertible Notes and the Options.
Yours faithfully, TZ LIMITED
==> picture [83 x 52] intentionally omitted <==
Kenneth Ting
Executive Director and Company Secretary
Page 4 of 4
Rule
2.7,
3.10.3,
3.10.4,
3.10.5
**Appendix
3B**
**New
issue
announcement, application
for
quotation
of
additional
securities and
agreement**
Information
or
documents
not
available
now
must
be
given
to
ASX
as
soon
as
available.
Information
and documents
given
to
ASX
become
ASX’s
property
and
may
be
made
public.
Introduced
1/7/96.
Origin:
Appendix
5.
Amended
1/7/98,
1/9/99,
1/7/2000,
30/9/2001,
11/3/2002,
1/1/2003,
24/10/2005.
Name
of
entity
TZ
LIMITED
ABN 26
073
979
272
We
(the
entity)
give
ASX
the
following
information.
**Part
1
-
All
issues**
You
must
complete
the
relevant
sections
(attach
sheets
if
there
is
not
enough
space).
-
1 +Class
of +securities
issued
or
to be
issued 1. Convertible
notes 2. Unlisted
options -
2 Number
of[+] securities
issued
or
to be
issued
(if
known)
or
maximum 1. 4,275
convertible
notes
issued
on
24 number
which
may
be
issued December
2010 2. 3,000,000
unlisted
options
issued
on 24
December
2010 -
3 Principal
terms
of
the[+] securities 1. Convertible Notes (eg,
if
options,
exercise
price
and expiry
+securities,
date; if
the
partly
amount
paid • The
convertible
notes
bear
interest
at
10% per
annum,
payable
on
31
December
each -
outstanding
and
due
dates
for + year. -
payment; if convertible • The
convertible
notes
must
be
repaid
on
the -
securities,
the
conversion
price fifth
anniversary
of
the
date
of
their
issue -
and
dates
for
conversion) unless
converted
into
ordinary
shares. -
• Subject to any required shareholder approval
being
obtained,
conversion
of
each convertible
note
into
ordinary
shares occurs
at
a
conversation
rate
per
share equal
to
$0.42. -
• The
convertible
notes
may
be
converted into
ordinary
shares
during
the period- commencing
on
the
date
of
issue
and expiring
on
24
December -
• The
convertible
notes
are
secured
by
a
fixed and
floating
charge
over
all
of
the Company's
assets
other
than
the
Company's shares
in
Product
Design
Technologies,
Inc. and
PDT
Holdings
Inc. 2. Options • The
exercise
price
is
$0.42. -
• The
options
expire
on
13
February 2013
and
may
be
exercised
at
any time
from
the
date
of
issue
to
the date
of
expiry,
in
multiples
of
1,000 options.
- commencing
-
4 Do
the[+] securities
rank
equally
in 1. Not
applicable all
respects
from
the
date
of 2. Not
applicable allotment
with
an
existing[+] class of
quoted[+] securities? If
the
additional
securities
do
not rank
equally,
please
state: -
the
date
from
which
they
do -
• the
extent
to
which
they participate for the next dividend,
(in
the
case
of
a
trust, distribution) or interest payment -
the
extent
to
which
they
do
not rank
equally,
other
than
in relation
to
the
next
dividend, distribution or interest payment -
5 Issue
price
or
consideration 1. $1,000
per
convertible
note 2. Nil -
6 Purpose
of
the
issue 1. Issued
in
repayment
of
principal
and (If
issued
as
consideration
for
the interest
due
under
a
US$4,100,000 acquisition of assets, clearly loan
facility
between
QVT
Fund
LP identify
those
assets) and
Quintessence
Fund
L.P.,
TZ Limited
and
Telezygology,
Inc.. -
- Not
applicable
- Not
-
See
chapter
19
for
defined
terms. Appendix
3B
Page
2
1/1/2003
| 7 Dates of entering+securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in clause 2 if applicable) 9 Number and +class of all +securities not quoted on ASX (including the securities in clause 2 if applicable) |
24 December 2010 |
|
|---|---|---|
| Number | +Class | |
114,322,669 |
Ordinary fully paid shares |
|
| Number | +Class | |
| 100,000 195,000 149,000 452,375 180,000 75,000 116,666 1,045,000 |
Options exercisable at $3.75 and expiring on 18 January 2011 Options exercisable at $3.75 and expiring on 19 January 2011 Options exercisable at $3.00 and expiring on 20 January 2011 Options exercisable at $6,00 and expiring on 31 December 2010 Options exercisable at $6.00 and expiring on 30 January 2011 Options exercisable at $6.00 and expiring on 7 Feb 2011 Options exercisable at $6.00 and expiring on 25 August 2011 Options exercisable at $2.50 and expiring on 24 October 2011. |
| 3,000,000 3,000,000 13,714 4,275 150,000 1,400,000 1,750,000 1,750,000 1,750,000 |
CB Options exercisable at $4.00 and expiring on 19 February 2013 Options exercisable at $0.42 and expiring on 19 February 2013. Convertible notes at an issue price of $1,000 per convertible note Secured convertible notes at an issue price of $1,000 per convertible note Options exercisable at $1.00 expiring on 29 March 2011. Rights under the Company’s Director and Executive Equity Plan Directors options exercisable at $1.00 and expiring on 30 June 2016. Directors options exercisable at $2.00 and expiring on 30 June 2017. Directors options exercisable at $3.00 and expiring on 30 June 2018. |
|
|---|---|---|
10 Dividend
policy
(in
the
case
of
a Not
applicable trust,
distribution
policy)
on
the increased
capital
(interests)
**Part
2
-
Bonus
issue
or
pro
rata
issue**
11 Is security holder approval Not
applicable required?
- See
chapter
19
for
defined
terms.
Appendix
3B
Page
4
1/1/2003
12 Is the issue renounceable or non- renounceable? 13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has+security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of+security holders 25 If the issue is contingent on +security holders’ approval, the date of the meeting |
|
|---|---|
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable. |
|
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| 26 Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do+security holders sell their entitlements_in full_through a broker? 31 How do+security holders sell_part_ of their entitlements through a broker and accept for the balance? 32 How do+security holders dispose of their entitlements (except by sale through a broker)? 33 +Despatch date |
Not applicable |
|---|---|
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable | |
| Not applicable |
**Part
3
-
Quotation
of
securities**
You
need
only
complete
this
section
if
you
are
applying
for
quotation
of
securities
-
34 Type
of
securities ( tick
one ) -
(a) Securities
described
in
Part
1
(b) All
other
securities Example:
restricted
securities
at
the
end
of
the
escrowed
period,
partly
paid
securities
that
become
fully
paid, employee
incentive
share
securities
when
restriction
ends,
securities
issued
on
expiry
or
conversion
of
convertible securities
**Entities
that
have
ticked
box
34(a)**
Additional
securities
forming
a
new
class
of
securities
- See
chapter
19
for
defined
terms. Appendix
3B
Page
6
1/1/2003
Tick
to
indicate
you
are
providing
the
information
or documents
35 If
the[+] securities
are[+] equity
securities,
the
names
of
the
20
largest
holders
of
the additional[+] securities,
and
the
number
and
percentage
of
additional[+] securities held
by
those
holders
36 If
the[+] securities
are[+] equity
securities,
a
distribution
schedule
of
the
additional +securities
setting
out
the
number
of
holders
in
the
categories 1
-‐
1,000 1,001
-‐
5,000 5,001
-‐
10,000 10,001
-‐
100,000 100,001
and
over
37 A
copy
of
any
trust
deed
for
the
additional[+] securities
**Entities
that
have
ticked
box
34(b)**
38 Number
of
securities
for
which N/A +quotation
is
sought 39 Class
of +securities
for
which N/A quotation
is
sought 40 Do
the[+] securities
rank
equally
in N/A all
respects
from
the
date
of allotment
with
an
existing[+] class of
quoted[+] securities? If
the
additional
securities
do
not rank
equally,
please
state: • the
date
from
which
they
do • the
extent
to
which
they participate for the next dividend,
(in
the
case
of
a
trust, distribution) or interest payment • the
extent
to
which
they
do
not rank
equally,
other
than
in relation
to
the
next
dividend, distribution or interest payment
41 Reason
for
request
for
quotation now Example:
In
the
case
of
restricted
securities,
end of
restriction
period (if
issued
upon
conversion
of another
security,
clearly
identify that
other
security)
N/A
Number +Class 42 Number and +class of all N/A +securities quoted on ASX ( including the
securities
in
clause 38)
- See
chapter
19
for
defined
terms.
Appendix
3B
Page
8
1/1/2003
**Quotation
agreement**
- 1 +Quotation
of
our
additional +securities
is
in
ASX’s
absolute
discretion.
ASX may
quote
the[+] securities
on
any
conditions
it
decides.
-
2 We
warrant
the
following
to
ASX. -
The
issue
of
the[+] securities
to
be
quoted
complies
with
the
law
and
is not
for
an
illegal
purpose. -
There
is
no
reason
why
those[+] securities
should
not
be
granted + quotation. -
An
offer
of
the[+] securities
for
sale
within
12
months
after
their
issue will
not
require
disclosure
under
section
707(3)
or
section
1012C(6)
of the
Corporations
Act.
Note:
An
entity
may
need
to
obtain
appropriate
warranties
from
subscribers
for
the
securities
in
order
to
be
able to
give
this
warranty
-
Section
724
or
section
1016E
of
the
Corporations
Act
does
not
apply
to any
applications
received
by
us
in
relation
to
any[+] securities
to
be quoted
and
that
no-‐one
has
any
right
to
return
any[+] securities
to
be quoted
under
sections
737,
738
or
1016F
of
the
Corporations
Act
at
the time
that
we
request
that
the[+] securities
be
quoted. -
If
we
are
a
trust,
we
warrant
that
no
person
has
the
right
to
return
the +securities
to
be
quoted
under
section
1019B
of
the
Corporations
Act
at the
time
that
we
request
that
the[+] securities
be
quoted. -
3 We
will
indemnify
ASX
to
the
fullest
extent
permitted
by
law
in
respect
of
any claim,
action
or
expense
arising
from
or
connected
with
any
breach
of
the warranties
in
this
agreement. -
4 We
give
ASX
the
information
and
documents
required
by
this
form.
If
any information
or
document
not
available
now,
will
give
it
to
ASX
before +quotation
of
the
+securities
begins.
We
acknowledge
that
ASX
is
relying
on
the information
and
documents.
We
warrant
that
they
are
(will
be)
true
and complete.
Sign
here: ............................................................
Date: Director/Company
secretary
Print
name:
==
==
==
==
==
- See
chapter
19
for
defined
terms.
24/10/2005
Appendix
3B
Page
9