Wireline telecommunications company Otelco Inc. (OTT,OTT_UN.TO) said Friday it has emerged from bankruptcy and completed its balance sheet restructuring process, including an extension of its senior credit facility.
"Today, we completed the actions necessary to implement the final steps of our restructuring Plan," said Chief Executive Mike Weaver, President and Chief Executive Officer of Otelco.
The company repaid $28.7 million on its senior credit facility and extended its maturity through April 2016. The remaining balance of $133.3 million will have quarterly principal payments of 1.25% of the new loan amount plus interest on the outstanding balance at 6.5%.
In addition, the company will utilize 75% of its quarterly free cash flow to further reduce the outstanding balance on the loan each quarter. The facility includes a $5.0 million revolver which was undrawn at closing.
These actions, along with the actions described below, complete the requirements of the company's pre-packaged Plan and allow Otelco to exit bankruptcy today.
Otelco's existing Class A stock and the majority of its subordinated debt traded together as an IDS on both the NASDAQ Global Market and the Toronto Stock Exchange. Today will be the last trading day for its IDSs.
The company noted that its old Class A shares were part of the IDS and will be extinguished. Five of the subordinated debt bonds, including the bonds that were part of the IDS, will be exchanged for one new Class A share which will trade under the symbol OTEL on the NASDAQ Global Market beginning after the Memorial Day holiday.
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