WESTBOROUGH, Mass.-Arch Communications Inc. amended the bank facility of its wholly owned subsidiary, Arch Paging Inc.
Terms of the new credit facility, which will become effective upon closing of the Paging Network Inc. merger, provide for an increase to $1.3 billion to accommodate PageNet’s outstanding bank debt.
Arch also reached agreement with Resurgence Asset Management L.L.C. to exchange shares of Arch’s series D convertible preferred stock for about $90 million accreted value of 10.875-percent senior discount notes due 2008. Based on the conversion ratio of the series D stock and the exchange ratio of the senior discount notes for shares of series D stock, the effective exchange rate will be 66.1 shares of Arch common stock per $1,000 of maturity value of the discount notes.
In addition, Resurgence has agreed to sell $48.4 million accreted value of 10.875-percent senior discount notes to a third party that will exchange the notes for 3.5 million shares of common stock at an exchange ratio of 66.1 shares per $1,000 note.
Arch noted the transaction will further reduce the company’s leverage ratio and result in an annual interest saving of more the $15 million.
