SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
REPORT
OF FOREIGN PRIVATE ISSUER
PURSUANT
TO RULE 13a-16 OR 15a-16 OF
THE
SECURITIES EXCHANGE ACT OF 1934
Report on Form 6-K dated January 6, 2010
Partner
Communications Company Ltd.
(Translation
of Registrant’s Name Into English)
8 Amal
Street
Afeq
Industrial Park
Rosh
Ha’ayin 48103
Israel
(Address
of Principal Executive Offices)
(Indicate
by check mark whether the registrant files or will file annual
reports
under
cover of Form 20-F or Form 40-F.)
Form
20-F x Form 40-F
o
(Indicate
by check mark whether the registrant by furnishing the
information
contained in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes
o No x
(If “Yes”
is marked, indicate below the file number assigned to the
registrant
in connection with Rule 12g3-2(b): 82-
)
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Enclosure:
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Partner
Communications announces Recent Developments during the Third and Fourth
Quarters of 2009
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PARTNER
COMMUNICATIONS ANNOUNCES RECENT
DEVELOPMENTS
DURING THE THIRD AND FOURTH
QUARTERS
OF 2009
ROSH HA'AYIN,
Israel, January 6, 2010 - Partner Communications Company Ltd.
("Partner" or "the Company") (NASDAQ and TASE: PTNR), a leading Israeli mobile
communications operator, announces the following
recent developments during the third and fourth quarters of 2009 and reports the
following additional information:
Site
Licensing
Following
the previously reported recommendations of the inter-ministry committee
regarding the appropriateness of future application of the exemption from
obtaining building permits for radio access devices, currently relied upon by
cellular operators, the Attorney General instructed the Ministry of Interior (in
consultation with the Ministry of Communications) to prepare regulations setting
conditions that would limit the exemption to extraordinary
circumstances.
Regulation
The
Ministry of Communications has recently commenced examination of the
interconnect tariffs in Israel following an August 2008 government resolution
regarding this matter.
In
addition, subsequent to the hearings being conducted by the Ministry of
Communications regarding a draft mobile virtual network operator ("MVNO")
license and regulations, and following a hearing conducted by the Ministry of
Communications in November 2009 regarding the prohibition of the existing
cellular operators from operating as MVNO operators, the Ministry of
Communications conveyed the regulations to the Ministry of Justice for
approval.
A tender
committee that was appointed by the Minister of Communications to allocate UMTS
frequency for an additional cellular operator recently published general
principles for the tender, which are not yet final. According to the principles
published, the tender will include additional UMTS spectrum for two additional
operators; participation will be allowed for new operators and MIRS
Communications Ltd, (other existing cellular operators will not be allowed to
participate) and the winner shall be awarded various benefits and leniencies
such as rebates on spectrum and license fees and exemptions from royalty
payments. In addition, the winner will be allowed gradual geographic deployment
of the infrastructure over a number of years.
The
tender committee will examine the possibility of allowing the winner to pay
interconnect tariffs in accordance with the lowest rate that will be set forth
in the regulations, from the beginning of its operation as a cellular
operator. Lastly, the Minister of Communications will consider allowing the
winner to provide mobile radio telephone services by using telecommunication
infrastructure of existing domestic cellular operators (for example through site
sharing and national roaming).
Financing
Following
the Company's press release, dated December 28, 2009, regarding the engagement
of the Company with leading banks in Israel, the Company hereby notifies that
during the months of September through December 2009, it had signed four credit
agreements with three Israeli leading banks, which are among the five leading
banks in Israel, and which shall be referred hereto as "Bank A", "Bank B" and "Bank C".
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A.
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Credit
agreements with Bank A and Bank B
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(a)
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The
Company had signed two separate credit framework agreements with Bank A
and an additional credit framework agreement with Bank B. A framework
agreement dated October 1, 2009 had been signed with Bank A for the
receipt by the Company of a credit framework in a principal sum of NIS 250
Million (hereinafter the "October Agreement"). A
framework agreement dated November 24, 2009 had been signed with Bank B
for the receipt by the Company of a credit framework in a principal sum of
NIS 700 Million (hereinafter the "November Agreement"). A
framework agreement dated December 2, 2009 had been signed with Bank A for
the receipt by the Company of a credit framework in a principal sum of NIS
250 Million ("December
Agreement" and collectively with the October Agreement and the
November Agreement, the "Framework Agreements").
The main terms and conditions contained in such credit Framework
Agreements are identical, except for specific changes which will be
detailed below.
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(b)
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The
nature of the loans - the Framework
Agreements provide the Company with an option to draw down two kinds of
loans - short terms loans (a maximum duration of one year) and On Call
loans. The minimal draw-down amount available under the October Agreement
and the December Agreement is NIS 100,000. The minimal draw-down amount
under the December Agreement is NIS 100,000 for short term loans and NIS
600,000 for On Call loans. The credit framework of the October Agreement
is for a term of five years effective as of October 1, 2009 and until
September 30, 2014. The credit framework of the November Agreement is for
a term of three years effective as of January 1, 2010 and. until December 31,
2012. The credit framework of the December Agreement is effective as of
January 1, 2010 until December 31,
2012.
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(c)
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Interest
- the interest rate chargeable under the October Agreement and the
December Agreement is the interest rate generally used by Bank A for its
customers for similar types of loans in NIS and for similar durations
(before margin) as apply under the October Agreement and the December
Agreement, plus an annual interest of 0.85%. The current interest rate
applicable under the October Agreement and the December Agreement is
therefore 2.2%. The interest rate chargeable under the November Agreement
is the interest rate generally used by Bank B for its customers for
similar types of loans in NIS and for similar durations (before margin),
as apply under the November Agreement, plus an annual interest of 0.85%.
The current interest rate applicable under the November Agreement is
therefore 2.25%.
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(d)
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Commitment
Fee - the Company is obliged to pay a commitment fee at a rate of
0.4% per annum regarding the average of the undrawn portion of the
credits. The commitment fee shall be payable on a quarterly
basis.
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(e)
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Collaterals
- the loans are not secured by any kind of
collaterals.
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(f)
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Covenants
- the main covenants set under the Framework Agreements are as
follows:
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| (1) | The Company is required to comply with the following financial ratios: (i) Total Debt1 to EBTIDA2 less Capital Expenditure shall not exceed 6.53; and (ii) Total Debt to EBTIDA shall not exceed 44. |
1Total Debt is defined as the aggregate of the amounts from time to time of any indebtedness appearing in the financial statements in respect of: (a) monies borrowed or debit balances at banks and other financial institutions; (b) any debenture, bond, note, long stock or other security, including, and without derogating from the above mentioned, any bank guarantee, issued to any third party, per request of the Company; (c) receivables sold or discounted (otherwise than on a non-recourse basis) to the extent only that any claim has been made against the Company with respect to such receivables; (d) the acquisition costs of any assets to the extent payable more than 365 days after the time of acquisition or possession by the party liable where the deferred payment is arranged primarily as a method of raising finance or financing the acquisition of that asset; and (e) any amount raised under any transaction other than those listed in paragraphs (a)-(d) above, having the commercial effect of a borrowing or raising of money. Provided that in computing the abovementioned amounts: any item following within paragraph (e) shall be included only to the extent the same is required by GP to be quantified in the financial statements. Any securitization transaction by the Company recognized as a "True Sale" in its financial statements, shall not constitute a part of the total debt
2EBITDA
is defined as follows: in respect of any ratio periods, the sum of the
following, all as appearing in the Company's financial statements, applicable
for such ratio periods: (a) the net income of the Company before extraordinary
items; (b) the amount of taxes set against the net profits of the Company in the
financial statements and (without double counting) any provision by the Company
for taxes; (c) any amortization and depreciation reflected in such financial
statements; and (d) any Net Financial Expenses. For the purpose of the
foregoing: "Net Financial Expenses" means, for any ratio period, financial
expenses, net for such ratio period, as appearing in the financial
statements
3This ratio was
1.3 as of September 30, 2009
4This
ratio was 0.86 as of September 30, 2009
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A
negative pledge covenant which restricts the Company from creating any
kind of security interest, except for the following: (i) any security
interest arising by law; (ii) security interests over goods and documents
of title to goods arising in the ordinary course of business, and in
respect of letter of credit transactions entered into in the ordinary
course of trade; (iii) any security interest on any asset or rights that
existed at the time of acquisition provided that the
acquisition was in the ordinary course of business on arms length terms,
where such security interest was not created in contemplation of or in
connection with the acquisition; (iv) any security interest arising from
operating or financial lease agreements ; (v) any security interest
arising from the netting of bank account balances; (vi) any security
interest arising by way of any retention of title of goods supplied where
such retention is done in the ordinary course of its business; (vii) any
specific security interest created pursuant to section 169(d) of the
Israeli Companies Ordinance, for the benefit of the entity who provided
the funding for the purchase of such asset; (viii) any other security
interests in favor of third parties (that are not floating security
interests) securing an aggregate obligation in a sum not higher than NIS
100,000 (in addition to the security interests detailed in sections (i) to
(vii) above).
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| (3) | Restriction to enter into a merger transaction, as a result thereof the Company will not be the surviving entity. |
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(g)
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Decrease
of Credit Framework - The Company may choose to decrease the credit
frameworks set under the Framework Agreements, subject to a fee
payment.
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(h)
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Events
of Default - The Framework Agreements contain customary events of
default which allow the lenders to accelerate the loans and demand
immediate repayment, such as in respect of a breach of obligations or
inaccurate representations under the Framework Agreements, receivership,
Company liquidation, appointment of a liquidator or other
winding up events of the Company, legal proceedings and attachments for
material amounts, ceasing of operations by the Company for certain
periods, cross default events in material amounts and any
affect on the Company's license,
etc.
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B.
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Credit
agreements with Bank C dated December 27,
2009
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(a)
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Nature
of the Loan - NIS dominated
Bullet1
loan, not linked to the CPI, in a principle amount of NIS 300 Million. The
principle amount of the loan had been drawn by the Company on December 28,
2009 and is due on December 27, 2013.
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(b)
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Interest
- an annual interest at the Prime rate minus 0.35%. Interest payments are
due at the end of every 3 months following the draw-down date of the
loan.
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(c)
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Collaterals
- the loan is
not secured by any kind of
collaterals.
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(d)
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Main
Covenants - (i) submission of financial reports; (ii)
restrictions to provide loans and guarantees, not in the ordinary course
of the Company's business and in fair market value; (iii) restriction to
enter into a merger transaction, as a result thereof the Company will not
be the surviving entity; and restrictions to perform any split or credit
arrangement6; (iv) Financial
ratios as follows (X) Total Debt7 to EBTIDA8 less Capital
Expenditure shall not exceed 6.59; and (Y) Total
Debt to EBTIDA shall not exceed 410; (Z) Principal
amount not to exceed 20% of the total obligations of the Company towards
the banks; (iv) A negative pledge covenant which restricts the
Company from creating any kind of security interest with exemptions
similar to the exemptions set under the October Agreement, the November
Agreement and the December Agreement with Bank A and Bank B, as
applicable.
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(e)
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Early
Repayment - The Company may make early repayments of the loan,
subject to an early repayment penalty, except for certain circumstances,
as set under the loan agreement.
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(f)
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Event
of Defaults - The agreement
contain customary events of default which allow the lenders to accelerate
the loans and demand immediate repayment similar to the
events of default under the October Agreement, the November Agreement and
the December Agreement with Bank A and Bank B, as applicable.
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C.
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Additional loans – the
Company's Board of Directors has approved taking additional short term
loans in an aggregated sum of NIS 200 Million, without a framework
agreement.
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Forward-Looking
Statements
This
press release includes forward-looking statements within the meaning of Section
27A of the US Securities Act of 1933, as amended, Section 21E of the US
Securities Exchange Act of 1934, as amended, and the safe harbor provisions of
the US Private Securities Litigation Reform Act of 1995. Words such as
"believe", "anticipate", "expect", "intend", "seek", "will", "plan", "could",
"may", "project", "goal", "target" and similar expressions often identify
forward-looking statements but are not the only way we identify these
statements. All statements other than statements of historical fact included in
this press release regarding our future performance, plans to increase revenues
or margins or preserve or expand market share in existing or new markets, reduce
expenses and any statements regarding other future events or our future
prospects, are forward-looking statements.
We have
based these forward-looking statements on our current knowledge and our present
beliefs and expectations regarding possible future events. These forward-looking
statements are subject to risks, uncertainties and assumptions about Partner,
consumer habits and preferences in cellular telephone usage, trends in the
Israeli telecommunications industry in general, the impact of current global
economic conditions and possible regulatory and legal developments. For a
description of some of the risks we face, see "Item 3D. Key Information - Risk
Factors", "Item 4. - Information on the Company", "Item 5. - Operating and
Financial Review and Prospects", "Item 8A. - Consolidated Financial Statements
and Other Financial Information - Legal and Administrative Proceedings" and
"Item 11. Quantitative and Qualitative Disclosures about Market Risk" in the
form 20-F filed with the SEC on April 27, 2009. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed in this
press release might not occur, and actual results may differ materially from the
results anticipated. We undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
About Partner
Communications
Partner
Communications Company Ltd. ("Partner") is a leading Israeli provider of
telecommunications services (cellular, fixed-line telephony and internet
services) under the orange™ brand. The Company provides mobile communications
services to over 3 million subscribers in Israel (as of September 30, 2009).
Partner’s ADSs are quoted on the NASDAQ Global Select Market™ and its shares are
traded on the Tel Aviv Stock Exchange (NASDAQ and TASE: PTNR).
Partner
is an approximately 45%-owned subsidiary of Scailex Corporation Ltd.
("Scailex"). Scailex's shares are traded on the Tel Aviv Stock Exchange under
the symbol SCIX and are quoted on "Pink Quote" under the symbol SCIXF.PK.
Scailex currently operates in three major domains of activity: 1) the sole
import, distribution and maintenance of Samsung mobile handset and accessories
products primarily to the three major cellular operators in Israel; 2)
distribution and sale of various manufacturers' mobile handsets, accessories and
provision of maintenance services, through a chain of retail stores and booths
("Dynamic"), to end customers of Cellcom (as part of the acquisition of the
controlling stake in Partner, Scailex announced to Cellcom the termination of
the distribution agreement through Dynamic, effective July 1, 2010) and; (3)
management of its financial assets.
For more
information about Scailex, see http://www.scailex.com.
For more
information about Partner, see http://www.orange.co.il/investor_site.
Contacts:
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Mr.
Emanuel Avner
Chief
Financial Officer
Tel: +972-54-7814951
Fax: +972-54-7815961
E-mail:
emanuel.avner@orange.co.il
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Mr.
Oded Degany
V.
P. Corporate Development, Strategy and IR
Tel: +972-54-7814151
Fax: +972-54-7814161
E-mail:
oded.degany@orange.co.il
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SIGNATURES
Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this Current Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
| Partner Communications Company Ltd. | |||
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By:
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/s/ Emanuel Avner | |
| Name: Emanuel Avner | |||
| Title: Chief Financial Officer | |||
Dated: January 6,
2010