5th Jan 2016 08:04
LONDON (Alliance News) - Motive Television PLC on Tuesday said it has agreed a deal with the largest investor in its convertible loan notes, in a move designed to get the company's balance sheet in order.
The deal means Motive Television will buy convertible loan notes with a face value of GBP1.4 million from the investor for GBP100,000, plus a five-year warrant that allows the holder to acquire 5.0% of the company. Completion of the acquisition is expected no later than January 15.
"The agreement to acquire the CLN's represent a significant improvement in the company's balance sheet. With the drive toward near term profitability based on the company's success in winning new contracts and success with our technology, the financial restructuring represents a balance sheet reset and hopefully a new beginning for Motive," Chairman Michael Pilsworth said.
The company originally issued about GBP6.6 million of fixed interest convertible loan notes in October 2010 to fund the acquisition of Motive Television SL. The outstanding, unredeemed convertible loan notes, which have a face value of roughly GBP3.0 million, were due to mature or December 31, 2015, not including the notes owned by the company's Motive Investments Ltd subsidiary with a face value of GBP1.1 million.
Talks with other holders of the loan notes continue, with the aim of extending their maturity or acquiring the instruments from their current owners.
Any acquired convertible loan notes are to be held in MTV Investments Ltd. Following the acquisition, MTV Investments will hold about 61% of the outstanding notes.
Meanwhile, Motive Television said its working capital continues to be "tightly managed", and that it relies on the support of its creditors, staff and of its directors.
"To assist in the drive toward monthly cash positive operations during the first half of 2016, the directors and senior management of Motive will continue to be compensated at the rate of half salary in cash and half in ordinary shares from January until the company reaches monthly cash profitability," the company said.
By Samuel Agini; [email protected]; @samuelagini
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