Did everyone miss this in the 10-k? I was just reviewing it:
From page 45 of the 10-K/405A
NOTE 14. SUBSEQUENT EVENTS
a) On February 15, 1999, Inversiones communicated to the Company that it had
incurred an Event of Default as a result of its failure to repay a US$ 20.3
million short-term Working Capital Loan plus interest accrued thereon granted on
June 24, 1998 (Note 8) and noncompliance with certain loan covenants. At the
time of granting the loan, Inversiones subscribed to a capital increase and
reserved its right to capitalize the loan, an option that, in addition to other
potential actions to obtain repayment, is still open.
Similarly, on February 15, 1999, Leap Wireless International, Inc. informed both
the Company and Telex-Chile S.A. that the former has incurred an Event of
Default with respect to the Deferred Payment Agreement, as a result of which the
amount of US$ 14.7 million plus interest accrued thereon is due and payable.
Telex-Chile S.A. is guarantor of 50% of this amount. As in the previous case,
the creditor has an option to capitalize this debt or to pursue payment through
other means.
b) Subsequently on March 2, 1999, Leap Wireless International, Inc. and
Inversiones indicated their withdrawal of the above-mentioned communications
reserving the right to notify the defaults again in the future. On March 16,
1999, Leap Wireless International, Inc. and Inversiones communicated defaults on
the short-term Working Capital Loan of US$ 20.3 million plus interest accrued
thereon and the Deferred Payment Agreement of US$ 14.7 million plus interest
accrued thereon on the same terms as expressed above.
In the report, wording has LWIN taking over Chilean assets in the event of a loan default. (See Previous post)
Jeff Vayda |
