Paetec Holding Corp (PAET)

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UPDATE 1-Paetec units settle billing disputes with Qwest
Thu Oct 16, 2008 4:35pm EDT
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Oct 16 (Reuters) - Telecommunications company Paetec Holding Corp (PAET.O: Quote, Profile, Research, Stock Buzz) said two of its units agreed with Qwest Corp and Qwest Communications Corp to settle all claims related to billing disputes between the companies.

Qwest has agreed to make a payment and, under specified circumstances, provide commercial credits to the two units, McLeodUSA Inc and McLeodUSA Telecommunications Services Inc, Paetec said.

Paetec believes that the amount of the payments and potential credits are immaterial to its business.

Separately, Paetec said it obtained $50 million principal amount of revolving loans by a drawdown of the maximum amount available under its current revolving credit facility.

Paetec said it plans to use the funds of the revolving loans for capital expenditures, working capital and other general corporate purposes, including potential repurchases of stock under its program to buy back up to $30 million of common stock through August 2009.

Shares of Fairport, New York-based Paetec closed up almost 11 percent at $1.54 Thursday on Nasdaq. (Reporting by Sandhya Menon in Bangalore; Editing by Pratish Narayanan)