$120 Million in Cash

Although Paetec’s common stock price has declined significantly, they firmly believe that their financial position is solid, and they have an outstanding value proposition. Paetec has worked very hard for many years to achieve that position and they are positioned to continue to do so. In this kind of environment, there are a few points every customer should know. Specifically:
  • Paetec continues to have the cash needed to run the business and to continue to provide unmatched service to their customers. They have generated positive free cash flow, measured as adjusted EBITDA* less capital expenditures, for 22 consecutive quarters through the second quarter of fiscal 2008. Paetec is very focused on continuing this performance.
  • They have had no problem servicing their debt and meeting their other obligations from the cash that they generate and from cash on hand.
  • They have substantial cash on hand. They have more than $120 million of cash on hand after giving effect to their drawdown on October 15, 2008 of $50 million in cash under their existing revolving credit facility.
  • They refinanced their credit facility debt in February 2007, and sold all of their outstanding 9.5% senior notes in July 2007, in each case, on terms that they believe provide significant financial and operating flexibility. The term and revolving loans under their credit facility and the notes represent substantially all of their long-term debt, and they believe they are positioned to continue to service these obligations