Vermont Pure Holdings has signed a commitment letter with Bank of America to refinance its senior debt facility and expects to close the transaction by April 1, 2005.

The company said it will use a US$28m term note to refinance its current senior term debt and operating and acquisition lines of credit. In addition, it will use US$3.6m to pay down a portion of its 12% subordinated notes. The anticipated savings on interest for refinancing the sub debt is estimated to be in excess of US$200,000 annually.

"We continue to focus on reducing our high rate debt. In one year, we will have reduced our subordinated debt from US$22.6m to US$14m with a direct repayment of US$5m a year ago and now this refinancing," said Tim Fallon, CEO of Vermont Pure Holdings, Ltd.

Additionally, the company has a secured a US$7.5m acquisition line of credit and a US$6.5m working capital facility with Bank of America.