INTERNATIONAL TELECHARGE, INC. ANNOUNCES NEW ACCOUNTS-RECEIVABLE FINANCING
INTERNATIONAL TELECHARGE, INC. ANNOUNCES NEW
DALLAS, Jan. 2 /PRNewswire/ -- International Telecharge, Inc. (AMEX: ITI) today announced that the company has entered into an agreement with Pittsburgh National Bank (PNB) and EDS Financial Corporation, a division of Electronic Data Systems, Inc., for accounts- receivable financing for the combined ITI and former Telesphere accounts. Under the PNB facility, the maximum amount of receivables that the company may finance at any time is equal to the lesser of $62.5 million or a specified percentage of the company's eligible accounts receivable. The company has drawn down the total $21.4 million current availability under the new facility. The term of the facility is through April 22, 1992. The company is currently seeking longer-term financing and EDS has agreed to use its best efforts to arrange for such financing that is satisfactory to the company.
This facility replaces the previously announced interim financing arrangement between ITI and Ronald J. Haan, the company's chairman and chief executive officer. Under that arrangement, R. Haan Ventures, Inc. (RHVI) purchased from the company's former receivables lender ITI's loan and assumed from that lender the company's loan agreement, security interest and related documents.
In connection with the PNB financing arrangement, Haan pledged $5 million to PNB as additional security for the new facility, which pledge was required by PNB as a condition to entering into the financing arrangement. RHVI will maintain a second priority security interest, subordinated to PNB, in the company's accounts receivable securing ITI's royalty obligation to RHVI arising from the purchase by ITI from RHVI of certain Telesphere assets.
As a result of the new accounts receivable financing and as consideration for the security pledge by Haan, ITI agreed to make immediate payment of the previously agreed upon one-time royalty prepayment to RHVI (in the amount of $17.4 million) and, further, agreed that payments to RHVI under the current royalty arrangement will be at a rate of no less than $500,000 per month.
International Telecharge, Inc. is a national telecommunications supplier of network-based operator and information services, primarily to hotels, payphone owners and other interexchange carriers.
/CONTACT: Phil Sawyer of ITI, 214-653-1265, or Roslyn Dawson of Hartenstein/Communications, 214-871-1949, for ITI/
(ITI) CO: International Telecharge, Inc.; Pittsburgh National Bank; EDS
Financial Corporation ST: Texas IN: TLS SU: FNC SM -- NY068 -- 6305 01/02/92 17:12 EST