ZTE sunk another $2.7 million into Enablence Technologies, an extension of a $10 million financing announced last July.
ZTE will receive 18 million shares of newly-issued Enablence stock (15 cents a share).
Enablence is a long-time supplier to ZTE, providing optical components and subsystems for access, metro and long-haul markets. The vendor has been struggling for years to remain afloat.
The company also said it has entered into a continuing Business Cooperation Agreement with ZTE that outlines existing and future research and development and product supply collaboration between the two companies.
Products covered under the agreement include Enablence’s advanced TOSA / ROSA products (transmit optical sub-assembly and receive optical sub-assembly, respectively) which are based on Enablence’s hybrid integration technology. Enablence’s TOSA multiplexes ten 10G transmitters to reach an aggregate 100G rate.
Enablence said ZTE’s demand for these products is expected to increase significantly during the next 12- to 24 months. Enablence is obligated to meet specific milestones in connection with the agreement with ZTE.
The shares ZTE is receiving are subject to a four month hold period pursuant to applicable securities laws, the companies said.
Enablence said the proceeds from the financing are expected to meet certain obligations including the repayment of certain bridge and short term loans and provide working capital.
