VTSS News Vitesse Initiates Consent Solicitation With Holders of Debentures
CAMARILLO, Calif.--(BUSINESS WIRE)--Vitesse Semiconductor Corporation (Pink Sheets:VTSS) today announced
that it is soliciting consents from the holders of the Company’s
$96.7 million aggregate principal amount of 1.5% Convertible
Subordinated Debentures due 2024.
If the necessary consents are received, the holders of the Debentures
and the Trustee under the indenture would agree that, for 18 months
after the date the proposed amendments are effective, the Trustee will
forbear from taking any action to exercise any rights or remedies that
relate to the filing of reports required under the Securities Exchange
Act of 1934. The Company will also agree not to repay the Debentures
pursuant to the purported acceleration request sent by the Trustee to
the Company during the last six months of the forbearance period.
In addition, the indenture for the Debentures would be amended so that
the conversion price of the Debentures will be permanently decreased
from $3.92 per share of the Company’s Common
Stock to $2.546 per share of Common Stock, subject to further adjustment
as set forth in the indenture.
As part of the consents, the repurchase price with respect to the
repurchase right, exercisable on October 1, 2009 only, would be
increased from 100 percent to 113.76 percent of the principal amount of
the Debentures to be purchased, plus accrued and unpaid interest. The
repurchase price with respect to the repurchase rights on October 1,
2014, and 2019 would not be changed.
Vitesse does not make any recommendation as to whether or not holders
should deliver consents. The solicitation will expire at 5:00 p.m.
Eastern time on November 3, 2006, unless extended by Vitesse.
About Vitesse
Vitesse designs, develops and markets a diverse portfolio of
high-performance, cost-competitive semiconductor solutions for
communications and storage networks worldwide. Engineering excellence
and dedicated customer service distinguish Vitesse as an industry leader
in Gigabit Ethernet LAN, Ethernet-over-SONET, Fibre Channel, Serial
Attached SCSI, Optical Transport, and other applications. Vitesse
innovation empowers customers to deliver superior products for
Enterprise, Access, Metro, and Core applications. Additional company and
product information is available at www.vitesse.com.
Safe Harbor
Statements made in this release that are not historical facts are
"forward-looking" statements (as defined in the Private Securities
Litigation Reform Act of 1995) that involve risks and uncertainties and
are subject to change at any time. These forward-looking statements may
include, but are not limited to, statements containing words such as
"anticipate," "believe," "plan," "estimate," "expect," "hope," "intend,"
and similar expressions. Factors that could cause actual results to
differ are identified in the public filings made by Vitesse with the
Securities and Exchange Commission and include the fact that we have
disclosed that you should not rely upon our published financial
statements and the fact that we have not filed all of our reports
required by the Securities Exchange Act of 1934. More information on
factors that could affect our business and financial results are
included in our public filings made with the Securities and Exchange
Commission, which are available on the web site of the Securities and
Exchange Commission, www.sec.gov.
The forward-looking statements involve known and unknown risks,
uncertainties and other factors that are, in some cases, beyond our
control. We caution investors that any forward-looking statements made
by us are not guarantees of future performance. We disclaim any
obligation to update any such factors or to announce publicly the
results of any revisions to any of the forward-looking statements to
reflect future events or developments.
