- 17 January 2006 -

Bookham extends Nortel supply agreement and pays off $65 million in debt

Optical component, module and subsystem supplier Bookham Inc has paid off about $65 million in long-term debt by entering into financing transactions that will result in the retirement of $45.9 million of secured notes and $19.4 million of the $25.5 million in outstanding convertible debentures (converted into about 3.9 million shares of Bookham stock).

Bookham used $20.0 million of cash to repay a portion of the debt, plans to issue about 10.3 million shares (plus new warrants to purchase about 1.1 million shares) to institutional investors who have taken on some of the debt in return, and will use $2.2 million in cash to prepay interest that would have accrued in future under the terms of the debentures.

Bookham has also agreed an amendment to a supply agreement due to expire on 29 April 2006 that will see Nortel Networks purchase at least $72 million of products through 2006. As part of the transactions, Bookham paid Nortel $20 million in cash plus accrued interest to retire $20 million in secured notes due in November 2007. Nortel has also entered into a Lock-up Agreement through 1 July 2006 for the 4.0 million shares of Bookham common stock that Nortel currently owns.

Finally, Bookham has reiterated its previous revenue guidance of November that it expects revenue for fiscal Q2/2006 (to end-December 2005) of $58-61 million.

Web: http://www.bookham.com