RCN Gets Another Extension3/15/2004 8:52 AM Eastern
RCN Corp. said Monday that talks with its senior secured lenders and others on a consensual financial restructuring have been extended until April 1, from the original deadline of Monday.
RCN had said in a statement Feb. 14 that it would not make interest payments on its 10.125% senior notes, which could have triggered defaults on all of its debt -- about $1.1 billion in bond obligations and $520 million in bank facilities.
But the company reached a forbearance agreement with lenders and bondholders, who agreed not to declare an event of default until at least March 1. That date was pushed to March 15 and, now, April 1.
The interest payment on the 10.125% notes was due Jan. 15 and, at that time, RCN said it was negotiating with bondholders concerning payment -- a move that many observers saw as a tactic to get bondholders to accept a debt-for-equity swap.
The operator has said that it expects any financial restructuring to be implemented through a reorganization under Chapter 11.
It has set up a Web site (rcntomorrow.com) to provide updates on its restructuring process.