March 22, 2007 — (WEB HOST INDUSTRY REVIEW) — Colocation services provider FiberNet Telecom Group (ftgx.com) announced on Thursday it has entered into a new $25 million credit facility with CapitalSource. The initial borrowings under this facility have been used to repay in full the company’s existing indebtedness. The facility further provides additional capacity to fund expansion and working capital.
With a maturity of five years, the credit facility consists of a $14 million term loan with a floating interest rate of LIBOR plus 3.5 percent, a $6 million revolving loan and letter of credit facility with a floating interest rate of LIBOR plus 3.0 percent and a $5 million capex loan facility with a floating interest rate of LIBOR plus 3.5 percent.
“We are very pleased to have established this new lending relationship with CapitalSource,” says Jon A. DeLuca, president and CEO. “This facility provides us with long-term capital and enhanced liquidity to support the continued growth of our business.”
As of the closing, the facility’s outstanding borrowings consisted only of the $14 million term loan. The company also issued $5.7 million of letters of credit under the revolving loan and letter of credit facility to replace its existing letters of credit. The credit facility includes other terms and conditions that are customary for a financing of this type.
