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December 30, 2005
MADRID, Spain -- JAZZTEL p.l.c. ("JAZZTEL"; Nuevo Mercado in Spain: JAZ), a telecommunications and data transmission carrier, today announces that it has reached an agreement with SOCIETE GENERALE Corporate and Investment Banking ("Société Générale") related to a PACEO Financing transaction consisting of a line of financing through various share issues only activated on JAZZTEL’s request. Based on those requests, Société Générale undertakes to subscribe up to the maximum of 140 million new shares or shares having a value of up to 120 million Euros depending on the share’s market performance and volumes exchanged (i.e. 11.40% of the company’s post-operation capital) at any time over the next 18 months.
According to the agreement reached with Société Générale, JAZZTEL may issue shares having a value of up to 80 million euros at each share issue.
The transaction is based on a resolution approved by shareholders authorizing the Board of Directors to issue and allot new shares without pre-emption rights.
The total amount of capital raised will depend on the company’s financing needs over the lifetime of the PACEO Financing. Should the agreement be executed, it will enable JAZZTEL to obtain a flexible and efficient financing to adequately fund future growth opportunities. Additionally, it will strengthen its share capital and reduce its financial gearing.
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