FairPoint in talks with lenders [Telecom]


Troubled phone company FairPoint Communications Inc. said Monday that it's in talks with some of its lenders in hopes of restructuring its debt, but still may be forced to file for bankruptcy protection.

FairPoint said that as part of those talks it has entered into a forbearance agreement with lenders that together hold more than 50 percent of the loans and commitments outstanding under its credit facility.

FairPoint has payments under the credit facility and its interest rate swap agreements totaling about $42 million due on Wednesday. The company said that it likely will fail to comply with the interest coverage ratio and leverage ratio covenants in the credit facility for the period ending the same day.

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