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Dialogic Announces A $39.5 Mln Debt Exchange - Quick Facts

Dialogic Inc. (DLGC: Quote) announced that it has signed securities purchase agreements with a broad group of its largest existing shareholders and their affiliates.

As per the terms of the securities purchase agreement, the purchasers have been issued convertible notes in the amount of $39.53 million in exchange for debt and term loan pre-payment premiums.

The convertible notes will be converted into common shares in Dialogic Inc. upon stockholder approval, which is expected at the June stockholder's meeting.

All debt and loan pre-payment premiums covered by the convertible notes will be exchanged at the rate of $1.00 per share of common stock with the exception of $2.96 million representing interest from the first quarter of 2012 that was not paid in cash, was added to principal and will now convert at the rate of $0.87 per share of common stock.

Upon the conversion of the convertible notes into common shares following stockholder approval, the company said that it expects to reduce the principal of its long-term debt held by Tennenbaum Capital Partners, LLC and certain of its affiliates from $92.83 million to $59.88 million, to eliminate its related party long-term debt of $5.07 million and to increase its common shares outstanding from 31.48 million to approximately 71.45 million.

The Company expects to reduce its 2012 quarterly cash interest by $2.60 million or $10.60 million annually.

by RTT Staff Writer

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