SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report:
September 1, 1999
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(Date of earliest event reported)
Electric Lightwave, Inc.
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(Exact name of Registrant as specified in charter)
Delaware 0-23393 93-1035711
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
4400 NE 77th Avenue, Vancouver, WA 98662
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(Address of principal executive offices) (Zip Code)
(360)816-3000
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(Registrant's telephone number, including area code)
No change since last report
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(Former name or address, if changed since last report)
Item 5. Other Events.
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This report is being filed to make available the following press release dated
September 1, 1999.
For Immediate Release News Release
Contacts:
Investors: Media: Media:
Fletcher Chamberlin Enid Lamey Jack Hardy
Electric Lightwave Inc. Electric Lightwave Inc. Electric Lightwave Inc.
(360) 816-3996 (360) 816-4682 voice (360) 816-3602 voice
fletcher_chamberlin@eli.net (800) 368-9102 pager (800) 391-3267 pager
www.eli.net enid_lamey@eli.net jack_hardy@eli.net
www.eli.net www.eli.net
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Electric Lightwave Enlarges Internet Backbone Capacity
and Consolidates National Retail Sales in Dallas
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VANCOUVER, Wash. - September 1, 1999 - Electric Lightwave Inc. (Nasdaq:
ELIX), a leading integrated communications provider, today announced a
significant upgrade to its premier Internet backbone along with a realignment of
its national retail data sales channel. The company plans to invest over $9
million in the next six months to upgrade the capacity of its Internet backbone.
Along with 14 Cisco GSR 12012 gigabit routers, which have a throughput
capacity three times that of Electric Lightwave's existing Cisco 7500 routers,
additional OC3s will be installed from Salt Lake City to Chicago; from Chicago
to Washington D.C.; from Washington D.C. to Dallas; and from Dallas to Palo
Alto, Calif. New OC3s will also link Palo Alto to Sacramento, Portland, Ore.,
and Seattle; and from Seattle and Sacramento back to Salt Lake City. This
significant network upgrade will boost the company's robust Internet
architecture, which was recently recognized by Boardwatch Magazine as one of the
top five Internet backbone providers in the country.
"We are upgrading the capacity of our Internet backbone because of our
recent rapid growth and the significant additional revenue opportunity that
exists in providing Internet backbone services," said Dave Sharkey, president
and chief operating officer of Electric Lightwave. "In the first half of 1999,
our Internet revenue was 132 percent higher than the first half of 1998. We
continue to see significant demand from a broad range of retail and wholesale
customers."
Electric Lightwave will continue to use its expanded national Internet
backbone to serve wholesale customers across the country as well as terminate
traffic from customers on its 6,000 miles of fiber in the western U.S.
Meanwhile, the company plans to consolidate its retail sales operations in
Dallas and will close six retail sales offices in the eastern U.S. by October 8.
These include Cleveland, Chicago, Atlanta, Washington D.C., New York and
Philadelphia. Electric Lightwave will maintain its data points-of-presence
(POPS) in each of these cities. The company will also maintain wholesale sales
offices focused on other telecommunications carrier customers in Atlanta, Kansas
City, Kan., Houston, Dallas and San Antonio, Texas.
"Our national data strategy has always been designed to increase the
traffic on our core fiber base in the West," added Sharkey, "and that continues
with our revised sales structure. We have attracted strategic national customers
and have determined that we can serve those customers and our core Western
customers on a national basis without the expense of local retail sales offices.
Going forward, we expect that this will improve our revenue to expense ratios,
focus our resources where we can get the best returns and help drive us toward
our goal of reaching Electric Lightwave's first quarter of positive EBITDA
(earnings before interest taxes, depreciation and amortization) in the second
half of next year."
The consolidation of the six retail sales offices will eliminate the
positions of 39 employees by September 10. The affected employees will be given
the opportunity to apply for open positions within the company or will be
eligible for a severance package. The company continues to grow, adding 392
employees within the last year to its current roster of 1,233 employees
nationwide.
About Electric Lightwave
Electric Lightwave Inc. (NASDAQ: ELIX) is a leading integrated
communications provider of enhanced data services, frame relay, ATM and Internet
access solutions to bandwidth intensive businesses and the growing e-commerce
market. The company provides long distance, Internet and data services
nationwide, with data points-of-presence in Atlanta, Chicago, Cleveland, Dallas,
Denver, Houston, Las Vegas, Los Angeles, New York, Palo Alto, Calif.;
Philadelphia, San Diego, San Francisco, San Jose, Calif.; and Washington, D.C.
As a full-service provider, the company offers businesses local and long
distance telephone service and high-speed broadband transport that interconnects
major markets in the West, including Seattle, Sacramento, Calif.; Salt Lake
City, Phoenix, Boise, Idaho; Spokane, Wash.; and Portland, Ore.
Headquartered in Vancouver, Wash., the company employs 1,233 and generated
revenues of $101 million in 1998, up 65 percent from 1997. Additional
information about Electric Lightwave Inc. is located on the World Wide Web at
www.eli.net.
Forward-looking statements
This press release contains forward-looking statements that are subject to
risks and uncertainties which could cause actual results to differ materially
from those expressed or implied in the statements. All forward-looking
statements are only predictions or statements of current plans, which are
constantly under review by Electric Lightwave (the Company). All forward-looking
statements may differ from actual future results due to, but not limited to,
changes in the demand for Internet backbone services, the company's ability to
reduce expenses as planned, changes in the local and overall economy, the nature
and pace of technological changes, the number and effectiveness of competitors
in the Company's markets, success in overall strategy, changes in legal and
regulatory policy, relations with Incumbent Local Exchange Carriers (ILECs) and
their ability to provide delivery of services including interoffice trunking,
implementation of back office service delivery systems, maintenance of exclusive
use of fiber on performance-based leases, the Company's ability to identify
future markets and successfully expand existing ones and the mix of products and
services offered in the Company's target markets. Readers should consider these
important factors in evaluating any statement contained herein and/or made by
the Company or on its behalf. The Company has no obligation to update or revise
forward-looking statements to reflect the occurrence of future events or
circumstances.
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Electric Lightwave, Inc.
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Registrant
By: /s/ Kerry D. Rea
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Vice President and Controller
Date: September 9, 1999