FairPoint draws on delayed-draw term loan and revolver

By Sara Rosenberg

New York, Sept. 15 - FairPoint Communications Inc. borrowed the remaining $100 million available under its $200 million delayed-draw term loan and $100 million under its $200 million revolving credit facility, according to a news release.

The borrowings were made late last week due to uncertainty in the financial markets and the Lehman Brothers situation.

"The company believes that these actions were necessary to preserve its availability to capital due to Lehman Brothers' level of participation in the company's debt facilities and the uncertainty surrounding both that firm and the financial markets in general," the release said.

Lehman accounts for 30% of the commitments under the delayed-draw term loan and the revolver.

The delayed-draw borrowings are expected to be used over the next several months to help complete the company's transition to its newly designed state-of-the-art systems and to continue to execute on its network expansion plans for the recently acquired operations in the northern New England states.

The revolver borrowings will be held on FairPoint's balance sheet until the financial markets stabilize.

These additional borrowings are not expected to have a material impact on the company's compliance with debt covenants for the quarter ended Sept. 30.

FairPoint is a Basking Ridge, N.J.-based provider of communications services.

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