Fusion Connect eyes approval of Zayo dark fiber services settlement

By Caroline Salls

Pittsburgh, Nov. 26 – Fusion Connect, Inc. requested court approval of a dark fiber lease master service agreement settlement reached with Zayo Group LLC, according to a motion filed Monday with the U.S. Bankruptcy Court for the Southern District of New York.

Fusion debtors Fusion Communications, LLC, Fusion Cloud Co. LLC, Fusion LLC and Fusion Cloud Services, LLC are also parties to the agreement.

Under the master services agreements, Zayo provides Fusion Communications with leased fiber services. In addition, some of the Fusion debtors and Zayo are party to a number of other pre-bankruptcy agreements under which Zayo provides telecommunications and related infrastructure services, including colocation and interconnect services.

The proposed settlement includes the Fusion debtors’ rejection of specified services ordered under the master service agreements, the rejection of some customer service contracts, the transfer of equipment and spare parts related to the dark fiber services being terminated that are used to support end-user customers at 624 locations, the assumption and assignment of building access agreements, the entry by some of the Fusion debtors into new service order forms with Zayo and mutual releases among the parties.

In addition, the company said the settlement resolves $2.8 million owed to Zayo by the debtors under the master services agreements for services provided.

In full satisfaction of the claims filed by Zayo, the Fusion debtors will pay $350,000 to Zayo. The debtors will also turn over any balance owed to Zayo under the master services agreements through the settlement effective date.

Zayo will also be allowed to submit an up to $5 million unsecured claim on account of any damages associated with the rejection of the dark fiber services.

A hearing is scheduled for Dec. 17.

Fusion is a New York-based cloud services provider. The company filed bankruptcy on June 3 under Chapter 11 case number 19-11811.

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