Primus, holders enter agreement for potential 13%, 14¼% note exchange

By Jennifer Chiou

New York, May 17 - Primus Telecommunications Group, Inc. along with its subsidiaries entered into a support agreement with a group of investors holding roughly 70% of its 13% senior secured notes due 2016, according to an 8-K filing with the Securities and Exchange Commission.

The subsidiaries include Primus Telecommunications Holding, Inc., the issuer of the notes, Primus Telecommunications IHC, Inc. and Primus Telecommunications Canada Inc.

The agreement mulls the start of potential offers to exchange the 13% notes as well as the company's 14¼% senior subordinated secured notes due 2013 for new 10% senior secured notes due 2017.

Primus will potentially issue $1,170 principal amount of new notes for each $1,000 principal amount of 13% notes and $1,012.50 of the new notes for each $1,000 of the 14.25% notes.

The company is also considering a solicitation of consents from holders of the 13% notes to amend the indenture and release the collateral.

Holders under the agreement have agreed to tender their notes for exchange.

Also under the support agreement, Primus Telecommunications IHC said that it would call for redemption all 14.25% notes that are not tendered in the exchange offers. Certain holders agreed to purchase up to an aggregate of $15 million of the new exchange notes in connection with the redemption.

The agreement can be terminated if the offers are not completed on or prior to Aug. 1, holders of less than 66 2/3% of the 13% notes and holders of less than 75% of the 14.25% notes have tendered their securities, or if there are not tenders in an amount sufficient to redeem all 14.25% notes that are not tendered and accepted in the exchange.

Primus is a communication solutions provider based in Mclean, Va.

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