Interliant Completes Public Exchange Offer of 7% Convertible Notes

📅 December 16, 2001 - Web hosting firm and Application Service Provider Interliant (interliant.com) said Friday it had successfully completed a public exchange offer to holders of its outstanding 7% Convertible Subordinated Notes issued February. The exchange offer resulted in the tender by holders and the acceptance by Interliant of $37.5 million in principal amount of the notes. Under the public exchange, the company offered to issue $270.00 principal amount of senior notes convertible into 270 shares of common stock, warrants to purchase 67.50 shares of its common stock at an exercise price of $0.60 per share, and pay $70.00 in cash in exchange for each $1,000 principal amount of Subordinated Notes that were tendered.

Interliant had previously announced in October that it had entered into an agreement with holders of $126.8 million in principal amount of the Subordinated Notes to exchange their notes in a private transaction on the same terms as offered in the public exchange. The combined public exchange and private transaction yielded a 99.6% participation rate among all the holders of the Subordinated Notes. The Company expects to close the private transaction by December 31, 2001. The closing of the public exchange and the private transaction will result in a reduction of $120 million in principal amount of the Company's outstanding notes.
``The successful execution of this exchange offer and the expected closing of the private transaction later this month will dramatically improve our balance sheet,'' said Frank Alfano, Interliant's Chief Financial Officer. ``This is a big step toward financial stability for Interliant, and I believe it will positively impact our core business growth through EBITDA breakeven.''