Australia's Evans & Tate obtains waiver after breaching convertibles covenant

By Jennifer Chiou

New York, June 14 - Evans & Tate Ltd. said its request for a waiver for its 8.25% convertibles notes passed "overwhelmingly," according to a company news release.

The company said 98.81% of noteholders voted to allow it to waive its non-compliance with the covenant for liabilities as a percentage of assets.

The Wembley, Western Australia-based winemaker said on March 7 it had "become aware" that it failed to meet the covenant requirement that total liabilities not exceed 80% of total assets.

At Dec. 31, the ratio was 86%, based on the company's unaudited accounts.

Evans & Tate previously said the problem is primarily due to a drawdown of A$10 million on its bank facility in the second half of 2005 in response to "difficult wine market conditions, particularly in the U.K."

Evans & Tate said it continued to make payments on the convertibles when due.

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