e.spire Continues Restructuring

e.spire Communications announced that it has a viable term sheet from an undisclosed lender for exit financing, and hopes to file a plan for emerging from Chapter 11 withing 60 days.

by Roy Mark of www.internetnews.com [December 27, 2001]

With a ring of optimism, e.spire Communications' (OTCBB:ESPIQ) Chairman George F. Schmitt announced his company's Board of Directors has authorized negotiations with creditors on a term sheet received from an undisclosed lender for exit financing.

"With a viable term sheet on the table, we are a step closer to emerging from Chapter 11," he said. The Herndon-based company filed for Chapter 11 protection with the U.S. Bankruptcy Court for the District of Delaware on March 22. The term sheet will allow the company to begin final negotiations with its creditors and make it possible to put in place a corporate reorganization.

The company said it expects to sign a term sheet and file its reorganization plan with the Bankruptcy Court within 60 days.

Earlier this month, Schmitt announced that he had recieved permission from the board to buy e.spire's Florida-based Internet subsidiary, CyberGate, Inc. for $15.5 million in cash. CyberGate operates ValueWeb, a manager of Web hosting, co-location, and related managed services.

Also adding to the company's cash position was a December 17 ruling by the Maryland Public Service Commission which ordered Verizon Communications to pay the company $1.5 million in overdue reciprocal compensation bills immediately.

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