EarthLink, ITC^DeltaCom give early tender results for 10½% notes; remainder to be redeemed

By Jennifer Chiou

New York, May 29 - EarthLink, Inc. announced that wholly owned subsidiary ITC^DeltaCom, Inc. received tenders and consents from holders of $129,672,000 of its $292.3 million of outstanding 10½% senior secured notes due 2016 as of 5 p.m. ET on May 28.

ITC^DeltaCom is soliciting consents to eliminate most of the covenants, some events of default as well as some other provisions contained in the indenture governing the 10½% notes.

The tender offer is scheduled to expire at 11:59 p.m. ET on June 11.

Holders who tendered their notes and delivered their consents to the amendments to the indenture before the consent expiration deadline on May 28 will be eligible to receive the total consideration of $1,058.75 for each $1,000 principal amount of notes. The total consideration includes a $30.00 consent payment.

Early settlement was slated for May 29.

The company said it will redeem any outstanding notes following the offer at 105.25 plus accrued interest to the June 28 redemption date.

Holders tendering after the consent expiration will receive the tender offer consideration of $1,028.75 per $1,000 principal amount, or the total consideration less the consent payment. Settlement for these holders will occur soon after the expiration of the offer.

Holders will also receive accrued interest up to, but not including, the applicable settlement date.

Tendered notes may be withdrawn and consents may be revoked before 5 p.m. ET on the earlier of May 28 and the date a supplemental indenture effecting the proposed amendments is executed.

The tender offer is conditioned on receiving consents from holders of 66 2/3% of the outstanding principal amount of the notes and execution of the supplemental indenture.

As previously reported, the offer is also subject to completion of a senior secured debt offering, proceeds of which will be used to fund the tender offer.

Credit Suisse Securities (USA) LLC (800 820-1653 or 212 538-0083) is the dealer manager for the tender offer. D.F. King & Co., Inc. (800 967-7921) is the tender and information agent.

EarthLink is an Atlanta-based internet access and communications services provider. It began the tender offer on May 14.

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