|By Business Wire||
|February 1, 2013 06:00 AM EST||
Otelco Inc. (NASDAQ: OTT) (TSX: OTT.un), a wireline telecommunication services provider in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont and West Virginia, today announced a restructuring transaction, which will strengthen the Company by deleveraging its balance sheet and reducing its overall indebtedness by approximately $135 million. Otelco has reached an agreement with its senior lenders to amend and extend the terms of its current senior financing through April 2016. In addition, our IDS units will be cancelled and the existing senior subordinated debt will be converted into equity. The vast bulk of our subordinated debt is held in the IDS units, and, as such, our IDS unit holders will continue to be significant shareholders of the Company as they are today. These efforts will better position the Company to compete in the 21st century telecommunications marketplace, solve the near-term maturity of the Company’s senior secured financing, and significantly reduce the Company’s debt burden. The Company currently has over $32 million in cash and sufficient liquidity to consummate this transaction.
In April 2012, Otelco announced the loss of a material contract to provide services to Time Warner Cable (TWC). The Time Warner contract expired on December 31, 2012 and TWC elected to begin performing services in-house rather than renewing the contract with Otelco. In addition to the loss of the TWC contract, recent rulings by the FCC will also continue to negatively impact the Company’s revenues. After consulting with advisors, the Board of Directors and senior management have concluded that reducing the Company’s debt and improving its capital structure will be best implemented through a “pre-packaged” chapter 11 filing, which has the support of the Company’s senior lenders.
Before making its chapter 11 filing, Otelco will seek the support of holders of record on February 8, 2013, of its senior subordinated notes (including notes held in the form of IDSs) for the proposed plan through a solicitation process that will occur in February, 2013. The voting process will take approximately 35 days. After that period, Otelco intends to voluntarily file its reorganization plan with the U.S. Bankruptcy Court in Delaware.
The chapter 11 process is designed to allow a company to continue its operations both during and after the filing. Thus, neither the solicitation nor the actual filing is expected to impact Otelco’s day-to-day operations. Otelco will continue to provide its customers with the quality services they have come to expect. “This filing will have no impact on our operations,” stated Michael Weaver, CEO of Otelco. “Our offices are open, all our employees are working and we’re still providing excellent service to all our customers. We hope to be in chapter 11 for a brief period of time. We have significant liquidity and it’s business as usual for us.” In addition, Otelco is, and intends to remain, current with all of its vendors.
“Our proposed plan, with the extension of the existing senior credit facility, will reduce total debt, simplify our capital structure and strengthen our balance sheet. I am confident that this restructuring represents the best possible outcome for the Company and our IDS unit holders, and I highly encourage the IDS holders to support it with a ‘yes’ vote during the solicitation,” continued Weaver.
The Company will hold a conference call to discuss the planned chapter 11 filing with investors on Friday, February 1, 2013, at 1:00 p.m. (Eastern Time). To listen to the call, participants should dial 719-325-4858 approximately 10 minutes prior to the start of the call. A telephonic replay will be available from 3:00 p.m. (Eastern Time) on February 1, 2013 through midnight on March 31, 2013 by dialing (719) 457-0820 and entering Confirmation Code 3741326. The live broadcast of Otelco’s conference call will be available online at www.OtelcoInc.com on February 1, 2013, beginning at 1:00 p.m. (Eastern Time). The online replay will be available at approximately 3:00 p.m. (Eastern Time) and continue for 60 days. A transcript of the call will also be available on the Company’s website on Monday, February 4, 2013 by the close of business.
FORWARD LOOKING STATEMENTS
Statements in this press release that are not statements of historical or current fact constitute forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties, and other unknown factors that could impact the Company’s restructuring plans or cause the actual results of the Company to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements which explicitly describe such risks and uncertainties, readers are urged to consider statements labeled with the terms “believes,” “belief,” “expects,” “intends,” “anticipates,” “plans,” or similar terms to be uncertain and forward-looking. There can be no assurance that the restructuring transaction described herein will be consummated. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company’s filings with the Securities and Exchange Commission.
Otelco Inc. provides wireline telecommunications services in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont and West Virginia. The Company’s services include local and long distance telephone, network access, transport, digital high-speed data lines and dial-up internet access, cable television and other telephone related services. With approximately 99,000 voice and data access lines, which are collectively referred to as access line equivalents, Otelco is among the top 25 largest local exchange carriers in the United States based on number of access lines. Otelco operates ten incumbent telephone companies serving rural markets, or rural local exchange carriers. It also provides competitive retail and wholesale communications services through several subsidiaries. For more information, visit the Company’s website at www.OtelcoInc.com.
Consumer IoT applications provide data about the user that just doesn’t exist in traditional PC or mobile web applications. This rich data, or “context,” enables the highly personalized consumer experiences that characterize many consumer IoT apps. This same data is also providing brands with unprecedented insight into how their connected products are being used, while, at the same time, powering highly targeted engagement and marketing opportunities. In his session at @ThingsExpo, Nathan Trel...
Sep. 4, 2015 07:00 AM EDT Reads: 293
Puppet Labs is pleased to share the findings from our 2015 State of DevOps Survey. We have deepened our understanding of how DevOps enables IT performance and organizational performance, based on responses from more than 20,000 technical professionals we’ve surveyed over the past four years. The 2015 State of DevOps Report reveals high-performing IT organizations deploy 30x more frequently with 200x shorter lead times. They have 60x fewer failures and recover 168x faster
Sep. 4, 2015 07:00 AM EDT Reads: 126
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.
Sep. 4, 2015 06:00 AM EDT Reads: 504
Through WebRTC, audio and video communications are being embedded more easily than ever into applications, helping carriers, enterprises and independent software vendors deliver greater functionality to their end users. With today’s business world increasingly focused on outcomes, users’ growing calls for ease of use, and businesses craving smarter, tighter integration, what’s the next step in delivering a richer, more immersive experience? That richer, more fully integrated experience comes ab...
Sep. 4, 2015 06:00 AM EDT Reads: 750
WebRTC services have already permeated corporate communications in the form of videoconferencing solutions. However, WebRTC has the potential of going beyond and catalyzing a new class of services providing more than calls with capabilities such as mass-scale real-time media broadcasting, enriched and augmented video, person-to-machine and machine-to-machine communications. In his session at @ThingsExpo, Luis Lopez, CEO of Kurento, will introduce the technologies required for implementing thes...
Sep. 4, 2015 05:00 AM EDT Reads: 127
The 5th International DevOps Summit, co-located with 17th International Cloud Expo – being held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the ...
Sep. 4, 2015 05:00 AM EDT Reads: 1,666
The 17th International Cloud Expo has announced that its Call for Papers is open. 17th International Cloud Expo, to be held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, APM, APIs, Microservices, Security, Big Data, Internet of Things, DevOps and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding bu...
Sep. 4, 2015 04:30 AM EDT Reads: 1,704
ElasticBox, the agile application delivery manager, announced freely available public boxes for the DevOps community. ElasticBox works with enterprises to help them deploy any application to any cloud. Public boxes are curated reference boxes that represent some of the most popular applications and tools for orchestrating deployments at scale. Boxes are an adaptive way to represent reusable infrastructure as components of code. Boxes contain scripts, variables, and metadata to automate proces...
Sep. 4, 2015 02:15 AM EDT Reads: 130
To support developers and operations professionals in their push to implement DevOps principles for their infrastructure environments, ProfitBricks, a provider of cloud infrastructure, is adding support for DevOps tools Ansible and Chef. Ansible is a platform for configuring and managing data center infrastructure that combines multi-node software deployment, ad hoc task execution, and configuration management, and is used by DevOps professionals as they use its playbooks functionality to autom...
Sep. 4, 2015 02:00 AM EDT Reads: 126
In his session at @ThingsExpo, Lee Williams, a producer of the first smartphones and tablets, will talk about how he is now applying his experience in mobile technology to the design and development of the next generation of Environmental and Sustainability Services at ETwater. He will explain how M2M controllers work through wirelessly connected remote controls; and specifically delve into a retrofit option that reverse-engineers control codes of existing conventional controller systems so the...
Sep. 4, 2015 02:00 AM EDT Reads: 270
The 3rd International WebRTC Summit, to be held Nov. 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 15th International Cloud Expo, 6th International Big Data Expo, 3rd International DevOps Summit and 2nd Internet of @ThingsExpo. WebRTC (Web-based Real-Time Com...
Sep. 4, 2015 01:15 AM EDT Reads: 1,629
It’s been proven time and time again that in tech, diversity drives greater innovation, better team productivity and greater profits and market share. So what can we do in our DevOps teams to embrace diversity and help transform the culture of development and operations into a true “DevOps” team? In her session at DevOps Summit, Stefana Muller, Director, Product Management – Continuous Delivery at CA Technologies, answered that question citing examples, showing how to create opportunities for ...
Sep. 4, 2015 01:00 AM EDT Reads: 540
Puppet Labs has announced the next major update to its flagship product: Puppet Enterprise 2015.2. This release includes new features providing DevOps teams with clarity, simplicity and additional management capabilities, including an all-new user interface, an interactive graph for visualizing infrastructure code, a new unified agent and broader infrastructure support.
Sep. 4, 2015 12:45 AM EDT Reads: 587
Skeuomorphism usually means retaining existing design cues in something new that doesn’t actually need them. However, the concept of skeuomorphism can be thought of as relating more broadly to applying existing patterns to new technologies that, in fact, cry out for new approaches. In his session at DevOps Summit, Gordon Haff, Senior Cloud Strategy Marketing and Evangelism Manager at Red Hat, discussed why containers should be paired with new architectural practices such as microservices rathe...
Sep. 4, 2015 12:00 AM EDT Reads: 448
IBM’s Blue Box Cloud, powered by OpenStack, is now available in any of IBM’s globally integrated cloud data centers running SoftLayer infrastructure. Less than 90 days after its acquisition of Blue Box, IBM has integrated its Blue Box Cloud Dedicated private-cloud-as-a-service into its broader portfolio of OpenStack® based solutions. The announcement, made today at the OpenStack Silicon Valley event, further highlights IBM’s continued support to deliver OpenStack solutions across all cloud depl...
Sep. 4, 2015 12:00 AM EDT Reads: 315