January 8, 2002 -- Covad Communications (OTCBB:COVD), a national broadband services provider utilizing digital subscriber line (DSL) technology, bought substantially all of the assets of InternetConnect in an auction supervised by the US Bankruptcy Court for the Central District of California. According to Covad, this purchase assures all InternetConnect customers on the Covad DSL network will be offered virtually uninterrupted broadband service for their business and residential use.

The purchase price for the assets of InternetConnect, a Torrance, Calif.-based Internet Service Provider (ISP) which has been in bankruptcy since May 2001, was $7.35 million. Covad did not assume any liabilities or obligations of InternetConnect but will fund any shortfall in operating revenue during the period in which customers will be transitioned to Covad. Assets include accounts receivable, cash, equipment and other assets and approximately 9,250 lines, which include digital subscriber line and T1 broadband connections, along with virtual private network (VPN) customers. The majority of these lines are currently on Covad's network. There will be a 90-day transition period for all assets to come under Covad's control.

The end users on the Internet Connect lines will be offered similar Covad services and should experience minimal service disruption. It is expected that customers will be able to maintain their email address and other services offered by Internet Connect during the transition period and beyond. Communications to customers telling them about the easy integration process will be sent by mid-January. Approximately 60 percent of Internet Connect customers are in the Los Angeles, San Diego, San Francisco, Chicago, Boston and Washington, D.C. areas.

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