FTE Consents to Foreclosure on Benchmark Builders Reduces $80 Million in Debt & Considers New Business Combination
October 15 2019 - 8:30AM
FTE Networks, Inc. (NYSE American: FTNW) (“FTE” or the “Company”),
announced that senior lender Lateral Investment Management LLC
(“Lateral”) took possession and ownership of FTE’s principal
subsidiary Benchmark Builders by means of a strict foreclosure
citing certain events of default caused by certain judgements
entered into by convertible note holders.
As more fully described in the Company’s Form
8-K filed with the Securities and Exchange Commission (the “SEC”)
on October 11, 2019, the Company consented to this foreclosure
proposal which provided for total debt relief equal to in aggregate
more than $80 million. This debt relief was an instrumental part of
the Company’s decision to agree to the proposed foreclosure terms
as the Company was determined to be over leveraged.
The Company has also received a term sheet
concerning a proposed business combination transaction
contemplating the contribution of a multi-billion dollar real
estate asset portfolio in exchange for a combination of securities
issued by the Company to be agreed upon by the asset contribution
party. The Company has also been in discussions as to additional
real estate assets to be contributed prior to the close of the
business combination transaction or after. As part of the proposed
transaction, the Company would also acquire a public non-traded
REIT with a portfolio of commercial development assets, further to
its strategy to both incorporate a REIT structure into the Company
and to enter into the independent broker dealer channel alternative
asset sector. In addition to the contribution of assets, the
proposing company intends to bring an experienced management team
to the Company.
The total debt relief under the foreclosure
proposal would increase to more than $108 million if the proposed
business combination is not consummated prior to December 31,
2019.
The Company is in discussions with board
candidates to replace three board members who resigned following
the foreclosure proposal. As discussed in the Company’s shareholder
letter dated September 12, 2019, the Company has been
expending significant efforts on many fronts to explore
various strategic alternatives that would improve the Company's
long-term financial health and operational effectiveness.
About FTE Networks, Inc.
FTE Networks, Inc. (“FTE”) through its
subsidiaries Crosslayer and Juscom divisions provide technology
solutions for smart building platforms, edge computing and network
infrastructure solutions for residential and commercial
properties. We create transformative smart platforms and
buildings. FTE’s services are predicated on smart design and
consistent standards that reduce deployment costs and accelerate
delivery of leading edge projects and services. The Company works
with Fortune 100/500 companies, including some of the world’s
leading Telecommunications and IT Services Providers as well as
REITs and Media Providers.
Forward-Looking Statements
This release may contain “forward-looking
statements” within the meaning of the safe harbor provisions of the
United States Private Securities Litigation Reform Act of 1995.
Generally, forward‐looking statements can be identified by the use
of forward‐looking terminology such as “believe,” “will,”
“intends,” “expects,” and may include statements regarding matters
that involve known or unknown risks, uncertainties and other
factors that may cause our results, levels of activity, performance
or achievements to differ materially from results expressed or
implied by this release. Forward-looking statements are
neither historical facts nor assurances of future
performance. Instead, they are based only on our current
beliefs, expectations, and assumptions regarding the future of our
business, future plans and strategies, projections, anticipated
events and market trends, the economy and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent uncertainties, risks and
changes in circumstances that are difficult to predict and many of
which are outside of our control. These risk factors and
others are included from time to time in documents we file with the
Securities and Exchange Commission, including but not limited to,
our Form 10-K’s, Form 10-Q’s and Form 8-K’s. Our actual
results and financial condition may differ materially from those
indicated in the forward-looking statements. Accordingly, you
should not place undue reliance on these forward-looking
statements. Any forward-looking statement made by us in this
release is based only on information currently available to us and
speaks only as of the date on which it is made. We undertake no
obligation to publicly update any forward-looking statement,
whether as a result of new information, future developments or
otherwise.
For more information, please contact:
Corporate Contact:FTE Networks,
Inc.237 W. 35th Street, Suite 601New York, NY
10001(877) 850-4308ir@ftenet.comNYSE American: FTNW
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