AAi.FosterGrant near agreement on restructuring debt

New York, Jan. 18 - AAi.FosterGrant, Inc. said it is in the final stages of negotiating a restructuring of its debt.

The Smithfield, R.I. optical products and costume jewelry company said is talking with a majority of its bondholders and its principal stockholder on a recapitalization that would exchange some of its debt for equity and see a significant additional equity investment.

AAi.FosterGrant said it has been holding discussions with an informal committee of bondholders representing 69% of the company's $51.85 million outstanding 10¾% senior notes due 2006.

The restructuring will cut the company's debt to $26 million from $78 million, reducing interest expense by $6 million a year to $2 million, and include a $4 million additional equity infusion by the company's principal investor.

"This recapitalization is built on the foundation of the profitability and operational improvements we have already made," said John Ranelli, president and chief executive officer, in a news release.

AAi.FosterGrant said it hired Affiliated Management Services of Atlanta to advise it in the restructuring negotiations.

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