UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 17, 2003
Mpower Holding Corporation
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(Exact names of registrants as specified in their charters)
Delaware 33339884-01 52-2232143
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
175 Sully's Trail, Pittsford, NY 14534
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(Address of principal executive offices) (Zip Code)
Registrants' telephone number, including area code: (585) 218-6550
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N/A
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(Former name or former address, if changed since last report.)
ITEM 9. REGULATION FD DISCLOSURE.
The following information is being furnished under Item 9 of Form 8-K
pursuant to Regulation FD under the Securities Act of 1933, as amended, and
shall not be incorporated by referenced into any of Mpower Holding Corporation's
reports or other filings made with the Securities Exchange Commission. The
following information was provided to one of Mpower's investors pursuant to a
confidentiality and standstill agreement which is scheduled to expire on Monday,
January 20, 2002.
Set forth below is selected pro forma financial data regarding Mpower
for the first quarter of 2003 after giving pro-forma effect to the sale of its
assets in Georgia, Florida, Texas, Michigan and Ohio as announced in its press
release on January 8, 2003 set forth below (the "Asset Sales"), as if the Asset
Sales had occurred as of December 31, 2002. Completion of the Asset Sales is
subject to a number of closing conditions and contingencies and there is no
guarantee that all or any of the Asset Sales will occur. This pro forma
financial data does not purport to represent what Mpower's operations or
financial position actually would have been if the Asset Sales had occurred as
of December 31, 2002 or what Mpower's operations or financial position will be
for future periods.
Pro Forma Monthly Revenue: $11.5 million to $12.0 million
Pro Forma Gross Margin: 40% to 45% of revenue
Employee Headcount: 850 to 950
Monthly EBITDA(1): ($1.5) million to ($0.5) million
Collocations: 294
Lines in Service: 269,684 (year ended 2002)
The Asset Sales are expected to generate net proceeds to Mpower of $17
million to $20 million over the next 6 months (excluding any proceeds from any
receivables financing also mentioned in the press release). Mpower is not
issuing any change to its prior guidance regarding its funding status.
(1) EBITDA is defined as earnings before interest, taxes, stock-based
compensation, depreciation and amortization. Network optimization
costs and reorganization costs are also excluded from this measure.
EBITDA is a measure commonly used in the communications industry to
analyze operating performance, leverage and liquidity, however it is
not a measure of performance calculated in accordance with generally
accepted accounting principles, or GAAP, and should not be considered
in isolation or as a substitute for operating income, net income or
cash flow from operating activities as reflected in Mpower's
consolidated financial statements in its reports that it files with
the SEC. Mpower's definition of EBITDA may not be comparable to
similarly titled measures reported by other companies.
Forward-Looking Statements: Under the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, Mpower cautions investors that the pro
forma information and data set forth above constitute forward-looking
statements. Mpower's management wishes to caution the reader these
forward-looking statements are not historical facts and are only estimates or
predictions. Actual results may differ materially from those projected as a
result of risks and uncertainties including, but not limited to, the
consummation of all or any of the Asset Sales, anticipated cost reductions,
market acceptance of our product offerings, our ability to secure adequate
financing or equity capital to fund our operations, our ability to maintain a
high level of customer service, the performance of our network and equipment,
our ability to enter into strategic alliances or transactions, the cooperation
of incumbent local exchange carriers in provisioning lines and interconnecting
our equipment, regulatory approval processes, changes in technology, price
competition and other market conditions and risks detailed from time to time in
our filings with the Securities and Exchange Commission. The company undertakes
no obligation to update publicly any forward-looking statements, whether as a
result of future events, new information, or otherwise.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Mpower Holding Corporation has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
Date: January 17, 2003 MPOWER HOLDING CORPORATION
By: /s/ S. Gregory Clevenger
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Name: S. Gregory Clevenger
Title: Executive Vice President and Chief
Financial Officer
EXHIBIT INDEX
Exhibit No. Description of Document
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99.1 Press Release issued by Mpower Holding Corporation on January
8, 2003.