LOUISVILLE, Ky.--(BUSINESS WIRE)--Lightyear Network Solutions, Inc. (the “Company”) (OTCBB: LYNS), an established provider of data, voice and wireless telecommunication services to business and residential customers throughout North America, today announced that it has completed a transaction to redeem all of its outstanding shares of convertible preferred stock.
In the transaction, the Company redeemed 9.5 million shares of convertible preferred stock held by LY Holdings, LLC (“LYH”), plus the preferred stockholders surrendered their rights to accrued dividends of approximately $2.2 million, in exchange for receivables due to the Company totaling approximately $12.9 million. The convertible preferred stock redemption is expected to result in a fourth quarter, one-time, non-cash deemed preferred stock dividend of approximately $10.7 million, which will be presented in the statement of operations as a deduction to arrive at the loss attributable to common stockholders.
“We are pleased to announce the redemption of our convertible preferred stock,” said Stephen M. Lochmueller, Lightyear’s Chief Executive Officer. “Since I became CEO, a key objective was to minimize the dividend obligations and preferential position of our convertible preferred stockholders and to strengthen the position of the Company’s common stockholders.”
As a result of the transaction, the Company’s common stock is the only class of capital stock that is issued or outstanding. As of September 30, 2011, 22,089,888 of common shares were issued and outstanding.
“We believe that the redemption of our convertible preferred stock will have an immediate impact on how our stock is viewed,” said Randy Ammon, Lightyear’s President and Chief Operating Officer. “The net loss per share attributable to the common stockholders would have been reduced by nearly $0.02 per share during the first six months of 2011 primarily by the elimination of the convertible preferred stock dividend had this transaction been recorded as of January 1, 2011.”
Mr. Lochmueller added, “By eliminating our convertible preferred stock, we believe this helps improve the attractiveness of Lightyear’s common stock and shows management’s commitment to our common stockholders.”
Additional information regarding this transaction may be found in the Company’s Form 8-K dated November 7, 2011, as filed with the Securities and Exchange Commission.
About Lightyear Network Solutions, Inc.
Through its wholly owned subsidiaries, Lightyear Network Solutions, Inc. provides telecommunication services to large, medium and small businesses and to residential consumers throughout North America. Lightyear’s product offerings include local PRI and digital T1, enhanced Internet services, MPLS, Ethernet, Voice over Internet Protocol (VoIP), local and long distance service, and conferencing. Lightyear also offers wireless services to customers in the U.S. through wholesale contracts with multiple wireless providers. Lightyear built its own VoIP network in 2004 to enhance its product offerings and has partnered with some of the most prominent names in telecom including: Sprint, Verizon, AT&T, Level 3, Windstream, CenturyLink, tw telecom, XO Communications, Cisco and ADTRAN. Lightyear Network Solutions is headquartered in Louisville, Ky. Additional information can be found at: www.lightyear.net.
Forward-Looking Statements
This press release contains “forward-looking statements” for purposes of the Securities and Exchange Commission’s “safe harbor” provisions under the Private Securities Litigation Reform Act of 1995 and Rule 3b-6 under the Securities Exchange Act of 1934. These forward-looking statements are subject to various risks and uncertainties that could cause Lightyear’s actual results to differ materially from those currently anticipated. These forward-looking statements may include, without limitation, statements about our marketing and acquisition opportunities, business strategies, competition, expected activities and expenditures as we pursue our business plan. Although we believe that the expectations reflected in any forward-looking statements are reasonable, the risks and uncertainties which could cause our actual results to differ materially from those currently anticipated includes changes in market conditions, our ability to integrate acquired operations, the ability to obtain additional financing on satisfactory terms, customer acceptance of products, regulatory issues, competitive factors, or other business circumstances and risk factors described in our filings with the Securities and Exchange Commission. Lightyear undertakes no obligation to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this press release.