Dear Ron,
As promised, we are writing again to provide an update on recent
progress made in our restructuring. We understand that the key
question facing XO customers relating to the restructuring is
whether we will continue to provide the quality and service that
our customers have come to expect. On that point, we are pleased
to confirm that since our parent company, XO Communications,
Inc., made its Chapter 11 filing on June 17, XO customers have
continued to experience "business as usual" with respect to their
XO service. In fact, over the past few months we've had a number
of positive developments with our business and our services.
* During our most recently reported earnings period, we reported
that we had increased our year-over-year revenue by more than 20
percent.
* We expect to move to positive operating cash flow when we
report our next quarter results.
* We have enhanced and improved our customer care organization
moving dedicated customer care professionals to a greater number
of XO accounts. We believe this will add to an already strong XO
customer satisfaction rating that now sees more than 82 percent
of XO customers satisfied or highly satisfied with their service.
* American's Network Magazine (May 15, 2002) recently named XO
the best overall ISP and the most reliable DSL service provider.
* Boardwatch Magazine (May 2002) and Keynote Systems recently
ranked XO in the top two in its testing of the 30 largest network
backbone providers in the United States (ahead of WorldCom,
Sprint, Cable & Wireless, Qwest, Level 3, Genuity and a host of
others).
And while we know that getting the same innovative services and
quality service is your primary concern, we wanted to keep you up
to date on recent developments in the restructuring process.
Since we last communicated, a number of important and positive
developments have occurred in connection with our restructuring
efforts. We believe that each of these important developments
sets the stage for a successful restructuring of our parent
company's balance sheet, which as the Wall Street Journal
recently reported, is "bringing the company one step closer to
reorganization." Specifically, these developments include:
* XO obtaining the support of representatives of our two most
significant creditor constituencies (the banks and bondholders)
for both of the restructuring alternatives provided for in our
plan of reorganization. We believe this support from our two
leading creditor groups will make it more likely that XO's
restructuring will be successfully completed in a reasonably
expedited fashion.
* The Bankruptcy Court approving XO's Disclosure Statement and
related creditor solicitation materials, permitting XO to move
ahead with the solicitation of its creditors to obtain the
approvals needed to confirm the plan of reorganization. This
solicitation began around July 26th.
* The Court setting an August 26th hearing date to consider
confirmation of the proposed plan of reorganization, a critical
step in the process of completing the restructuring and our
parent company's successful emergence from the Chapter 11
process.
To read about our recent progress in detail, we invite you to
read our July 22nd press release available at
xo.com . You're also welcome to visit our
Financial Restructuring Update available from our homepage at
xo.com .
In the meantime, we thank you for your continued support as an XO
customer and look forward to updating you on our progress again
in the near future.
Sincerely,
Nate Davis,
President and Chief Operating Officer
XO Communications, Inc. |
