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TELECONFERENCE ANNOUNCEMENT
Management will hold a conference call to discuss the developments noted in this press release on March 22, 1999, at 2 p.m. (EST).
Investors can participate by dialing: 888/603-7037, pass code 1102815.
Heartland Wireless Communications, Inc., a provider of wireless broadband network and multichannel subscription television services at 2.1 GHz to 2.7 GHz, today announced that the U.S. Bankruptcy Court for the District of Delaware has confirmed its prenegotiated plan of reorganization (the "Plan"), which was filed under Chapter 11 of the U.S. Bankruptcy Code on December 4, 1998.
The company noted that the Plan received the support of all classes of creditors voting on the Plan, including the holders of over 99% in principal amount of the company's senior notes. The company also announced that concurrently with its emergence from Chapter 11, it intends to change its corporate name to Nucentrix Broadband Networks, Inc. ("Nucentrix"), to more accurately reflect its new business plan focus.
As disclosed in prior public filings, the confirmed Plan provides, among other things, for the conversion of $325 million of senior and subordinated debt into approximately 100% of the outstanding common stock of the reorganized company. The company expects to emerge from Chapter 11 with approximately $12 million in net long-term debt relating to FCC spectrum licenses in over 80 markets, and available cash of at least $25 million.
On the effective date of the Plan, which the company expects to be April 1, 1999, the company will change its name to Nucentrix Broadband Networks, Inc. and restructure its business in the following four wholly owned subsidiaries: Nucentrix Internet Service, Inc. ("Nucentrix Internet"), Nucentrix Telecom Services, Inc. ("Nucentrix Telecom"), Nucentrix Spectrum Resources, Inc. ("Nucentrix Spectrum") and Heartland Cable Television, Inc. ("Heartland Cable").
Nucentrix Internet will operate the company's high-speed Internet access business. The company currently operates one high-speed Internet business in Sherman and Denison, Texas, which provides Internet access to medium-sized businesses and SOHOs at speeds of up to 1.54 Mbps. The company currently is constructing a similar system in Austin, Texas, which it expects to launch under the Nucentrix(tm) name in May 1999. The company plans to roll out similar services in other markets.
Nucentrix Telecom will be formed to test, develop and operate wireless broadband IP (Internet Protocol) telephony services, including wireless local loop voice services.
Nucentrix Spectrum will own the company's MMDS spectrum rights, including BTA (basic trading area) licenses, MMDS channel licenses and leases and WCS (wireless communications service at 2.3 GHz) spectrum rights, as well as the company's wireless transmission facilities and site leases.
Heartland Cable will operate the company's existing subscription television business, which serves approximately 158,000 subscribers in 57 markets and offers combined MMDS and DIRECTV(R) programming in 51 of the 57 markets. This business will continue to operate under the name Heartland Cable Television(tm).
Carroll D. McHenry, who will remain Chairman and CEO of Nucentrix, stated, "We are extremely pleased that our financial restructuring was confirmed by the court and overwhelmingly approved by those voting on the plan. Now we can focus our efforts on exploiting the value of our broadband spectrum with new business applications such as high-speed Internet access and, over the long term, point to multipoint wireless voice services. We believe the name change will help reflect this redirection of our focus. We want to position Nucentrix to respond quickly to what we see as significant demand for high-speed communications services that are affordable to small and medium-size businesses, and we are committed to making this happen."
The company stated that certain conditions were required to be satisfied or waived before the Plan could become effective, including filing a shelf registration statement on Form S-1 with the Securities and Exchange Commission for shares of common stock of Nucentrix to be held by persons who may be considered affiliates of the reorganized company, and filing certain information with the Federal Communications Commission relating to the transfer of MMDS channel rights to the reorganized company. The company believes that all conditions to the effectiveness of the Plan will be satisfied or waived by the anticipated effective date of the Plan.
Heartland Wireless Communications, Inc. provides wireless broadband network and multichannel subscription television services in the 2.1 GHz to 2.7 GHz range. Heartland operates a high-speed Internet access business in one market, and provides wireless subscription television service to approximately 158,000 subscribers in 57 markets. Heartland currently holds broadband wireless spectrum rights in over 80 small to mid-size markets in the central United States. DIRECTV is a trademark of DIRECTV, Inc., a unit of Hughes Electronics Corporation.
Except for any historical information contained in this press release, this press release contains forward-looking statements that involve risks and uncertainties, including the risk of not consummating the Plan, the inability to obtain financing and other risks and uncertainties described in the company's 10-K for the period ended December 31, 1998 (which the company expects to file with the SEC on or before March 31, 1999), the company's 10-Q for the period ended September 30, 1998, and other SEC reports of Heartland Wireless Communications, Inc. In particular, there can be no assurance that the company will be able to obtain the capital necessary to launch wireless broadband IP services such as Internet access services in additional markets or to test, develop and operate wireless broadband IP telephony services.
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na/da*
CONTACT: Heartland Wireless Communications, Inc., Dallas
Carroll D. McHenry, 972/633-4037
or
Marjean Henderson, 972/633-4035
KEYWORD: TEXAS DELAWARE
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED TELECOMMUNICATIONS
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