GTS Bank Waiver Extended; Delays Annual Shareholders' Meeting; Elects not to Pay Interest on
Publicly-traded Bonds
LONDON, Aug 15, 2001 (BUSINESS WIRE) -- Global TeleSystems, Inc. ("GTS") (OTC:GTLS; NASDAQ
EUROPE:GTSG; Frankfurt:GTS) announced today that Deutsche Bank, Dresdner Bank and Bank of America (the
"Bank Group"), which are providing financing to GTS' Global TeleSystems Europe Holdings B.V. subsidiary, have
agreed to further extend the waiver of any defaults under their facility caused by GTS' election to not make interest
payments on GTS Europe's publicly-traded debt while the company works toward a debt restructuring plan with
bondholders. The current waiver has now been extended until August 31, 2001. GTS and the Bank Group continue their
discussions, aimed at replacing the current financing agreement with a longer-term financing facility.
GTS also announced that it has postponed its Annual Shareholders' Meeting from September 5, 2001 due to its ongoing
restructuring. The company will advise the public when a new date for the annual meeting is established.
Consistent with its previously announced restructuring, GTS advised that it has decided not to make the cash interest
payment, due 15 August 2001 on its 9 7/8% US$105 million Senior Notes due 2005 and that its subsidiary Global
TeleSystems Europe B.V has decided not to make the cash interest payment due on its 11 1/2% US$265 million Senior
Notes due 2007. The non-payment of cash interest on these bonds will not constitute events of default under the
indentures governing these securities unless interest is not paid by September 14, 2001. GTS also announced that neither
it nor Global TeleSystems Europe BV anticipate making any further interest payments on their publicly-traded debt and
(in the case of GTS) preferred stock, pending the conclusion of their discussions with bondholders, aimed at a consensual
restructuring of the obligations under such securities.
This press release may include forward-looking statements that involve risk and uncertainty. Although the company
believes its expectations and projections reflected in such forward-looking statements are based on reasonable
assumptions, no assurance can be given that such projections or expectations, including, without limitation, those relating
to its future funding needs, will be fulfilled. Any such forward-looking statement must be considered along with
knowledge that actual events or results may vary materially from such predictions due to, among other things, political,
economic or legal changes in the markets in which GTS or GTS Europe do business, competitive developments or risks
inherent in the companies' business plan. Readers are referred to the documents filed by GTS and GTS Europe with the
U.S. Securities and Exchange Commission, specifically the most recent reports filed under the Securities Exchange Act of
1934 and registration statements filed pursuant to the Securities Act of 1933, which identify important risk factors. |
