PentaStar Commun Gets Waiver Of Defaults, Loan Extension
Dow Jones Newswires
DENVER -- PentaStar Communications Inc. (PNTA) received
a waiver of defaults from Well Fargo Bank West, National
Association, and an extension of the loan maturity until
Sept. 30.
The communications services company defaulted on the loans earlier this month, and has been in negotiations with the unit of Wells Fargo & Co. (WFC) since.
In a press release Friday, PentaStar said the extension will allow continued negotiations on restructuring its debt.
The company said it faced "abnormally high" levels of order cancellations and deferrals in the second quarter, when it reported a loss of $1.3 million, or 22 cents a share. The company lost $718,000, or 14 cents a share, the year before.
Although the waiver from Wells Fargo does not allow for additional borrowing, PentaStar expects cash flow to be enough to fund operations.
PentaStar has also launched a cost reduction program that it plans to fully implement by Sept. 30. The cuts will have a "positive impact" on third quarter results, the company said.
A company spokesman was not immediately available to offer details of the cuts.
Shares of PentaStar closed Thursday on the Nasdaq Market at $14.53, down 47 cents, or 3.1%.
Company Web site: pentastarcom.com
-Bill Platt; Dow Jones Newswires; 201-938-5400 |
