HOLMDEL, N.J., April 25, 2008 /PRNewswire-FirstCall via COMTEX News Network/
-- Vonage Holdings Corp. (NYSE: VG), a leading provider of broadband telephone
services, announced today that it has signed a non-binding letter of intent with
a third party financing source to provide $215 million in a private debt
financing. The Company expects that approximately two-thirds of the financing
will be provided through a senior secured credit facility and approximately
one-third will be provided through issuance of convertible secured notes. The
letter of intent is a proposal that will be used as a basis for financing and
does not constitute a commitment.
The Company intends to use the net proceeds from this financing, plus cash on
hand, to repay, tender for or redeem its existing convertible notes, which can
be put to the Company on December 16, 2008 and have a principal amount due of
approximately $253 million. As of March 31, 2008, the Company had approximately
$190 million in cash and cash equivalents of which $42 million was restricted
and $148 million was unrestricted.
John S. Rego, Vonage Chief Financial Officer said, "We are pleased with our
progress at this stage of our refinancing efforts, particularly during this
extremely challenging time for the credit markets."
The Company expects to provide an update on the status of its refinancing
efforts when it reports first quarter 2008 earnings on May 8, 2008. Additional
information regarding the non-binding letter of intent is included in a Form 8-K
filed today by the Company with the Securities and Exchange Commission.
About Vonage
Vonage (NYSE: VG) is a leading provider of broadband telephone services with
2.6 million subscriber lines. Our award-winning technology enables anyone to
make and receive phone calls with a touch tone telephone almost anywhere a
broadband Internet connection is available. We offer feature-rich and
cost-effective communication services that offer users an experience similar to
traditional telephone services.
Our Residential Premium Unlimited and Small Business Unlimited calling plans
offer consumers unlimited local and long distance calling, and popular features
like call waiting, call forwarding and voicemail -- for one low, flat monthly
rate. Vonage's service is sold on the web and through national retailers
including Best Buy, Circuit City, Wal-Mart Stores Inc. and Target and is
available to customers in the U.S., Canada and the United Kingdom. For more
information about Vonage's products and services, please visit
http://www.vonage.com.
Vonage Holdings Corp. is headquartered in Holmdel, New Jersey. Vonage(R) is a
registered trademark of Vonage Marketing Inc., a subsidiary of Vonage Holdings
Corp.
Safe Harbor Statement
This press release contains forward-looking statements regarding the
Company's proposed financing. The forward-looking statements in this release are
based on information available at the time the statements are made and/or
management's belief as of that time with respect to future events and involve
risks and uncertainties that could cause actual results and outcomes to be
materially different. These factors include the Company's ability to consummate
the financing arrangement, which is subject to numerous uncertainties, including
but not limited to completion of due diligence review by the financing party,
successful negotiation among the Company and the financing party of a commitment
for the financing arrangement and successful negotiation of definitive
documentation for the financing arrangement. The consummation of the
transactions may also be impacted by the other risks and uncertainties detailed
in the Company's filings with the Securities and Exchange Commission. While the
Company may elect to update forward-looking statements at some point in the
future, it specifically disclaims any obligation to do so, and therefore, you
should not rely on these forward- looking statements as representing our views
as of any date subsequent to today.
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