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EarthLink And ITC^DeltaCom Commence Tender Offer And Consent Solicitation For ITC^DeltaCom's 10.5% Senior Secured Notes Due 2016

Stocks in this article: ELNK





ATLANTA, May 14, 2013 /PRNewswire/ -- EarthLink, Inc. (NASDAQ: ELNK) today announced that it has caused ITC^DeltaCom, Inc., its wholly owned subsidiary, to commence a cash tender offer for any and all of the $292.3 million outstanding principal amount of ITC^DeltaCom's 10.5% Senior Secured Notes due 2016 (CUSIP No. 45031TAR5) (the "ITC^DeltaCom Notes"). In conjunction with the tender offer, ITC^DeltaCom is soliciting consents to eliminate most of the covenants, certain events of default applicable to the ITC^DeltaCom Notes and certain other provisions contained in the indenture governing the ITC^DeltaCom Notes and to release all of the collateral securing the ITC^DeltaCom Notes (the "Indenture"). EarthLink expects to fund the tender offer with the proceeds from a new senior secured debt offering.

The tender offer is scheduled to expire at 11:59 p.m., New York City time, on June 11, 2013, unless extended or earlier terminated (the "Expiration Time"). Holders who validly tender their ITC^DeltaCom Notes and provide their consents to the amendments to the Indenture before 5:00 p.m., New York City time, on May 28, 2013, unless extended (the "Consent Expiration"), will be eligible to receive the Total Consideration (as defined below), which includes a consent payment. The tender offer contemplates an early settlement option, so that holders whose ITC^DeltaCom Notes are validly tendered prior to the Consent Expiration and accepted for purchase could receive payment of the Total Consideration as early as May 29, 2013. Holders that validly tender their ITC^DeltaCom Notes after the Consent Expiration will receive the Tender Offer Consideration (as defined below) promptly after the Expiration Time. Tenders of ITC^DeltaCom Notes may be validly withdrawn and consents may be validly revoked until the Withdrawal Time (as defined below).

The "Total Consideration" for each $1,000 principal amount of ITC^DeltaCom Notes validly tendered and not validly withdrawn prior to the Consent Expiration is $1,058.75, which includes a consent payment of $30.00 per $1,000 principal amount of ITC^DeltaCom Notes. Holders tendering after the Consent Expiration will be eligible to receive only the "Tender Offer Consideration," which is $1,028.75 for each $1,000 principal amount of ITC^DeltaCom Notes. Holders will also receive accrued and unpaid interest from the last interest payment on the applicable ITC^DeltaCom Notes up to, but not including, the applicable settlement date for all of such ITC^DeltaCom Notes that we accept for purchase in the tender offer.

Tendered ITC^DeltaCom Notes may be withdrawn and consents may be revoked before 5:00 p.m., New York City time, on the earlier to occur of (a) May 28, 2013 or (b) the date of execution of the Supplemental Indenture (as defined below), unless extended (the "Withdrawal Time"), but generally not afterwards. Any extension, termination or amendment of the tender offer will be followed as promptly as practicable by a public announcement thereof.

The tender offer is subject to the satisfaction of certain conditions including: (1) receipt of consents to the amendments to the Indenture from holders of 66 2/3% of the principal amount of the outstanding ITC^DeltaCom Notes and execution of a supplemental indenture effecting such amendments (the "Supplemental Indenture"), (2) completion of the senior secured debt offering on satisfactory terms and (3) certain other customary conditions.  ITC^DeltaCom may waive any of the foregoing conditions in its sole discretion.

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