Birch Communications, Inc. entered into an asset purchase agreement to acquire substantially all assets of Lightyear Network Solutions, Inc. (OTCPK:LYNS) for $22 million on May 10, 2013. The purchase price is subject to adjustment. As per the agreement, at closing, $2.2 million of the purchase price will be placed into escrow to serve as security for payments. Birch Communications and Lightyear Network shall pay $0.5 million as termination fee at the time of termination. LY Holdings, LLC, largest shareholder of Lightyear, has voted in favor of the transaction. The agreement will not include any of Lightyear Network's cash or cash equivalents, rights under the agreement, any contracts, all tax refunds, rebates, overpayments and other rights, all books, records, files or other documentation and written materials, all shares of capital stock of Lightyear Network, incentive compensation, bonus, deferred compensation, pension, profit sharing, savings, retirement, stock option, stock purchase, group life, health or accident insurance or other employee benefit plans.

Also in connection with the agreement, Lightyear Network and Birch Communications entered into an amendment to the terms of a note receivable with a principal amount of $1.2 million. They have agreed that any distribution otherwise payable to Lightyear Network as a shareholder would be set off on a dollar for dollar basis against Lightyear Network's obligations under the term note. The deal is subject to approval of Lightyear Network's shareholders, execution on non solicitation agreement, customary regulatory approvals and other closing conditions. The Special Committee and Board of Directors of Lightyear Network have unanimously approved the transaction. Lightyear Network Solutions will use net proceeds from the transaction to fund repayment of outstanding secured indebtedness including a promissory note outstanding to a Lightyear's Director. Lightyear Network's stockholders approved the transaction on July 26, 2013.

Robert Sartin of Frost Brown Todd acted as legal advisor to Lightyear Network Solutions, Inc. U.S. Bank N.A. acted as escrow agent in the transaction. Vik Grover of Source Capital Group, Inc. acted as financial advisor for Birch. William Rowland of Jones Day acted as legal advisor for Birch.

Birch Communications, Inc. completed the acquisition of substantially all assets of Lightyear Network Solutions, Inc. (OTCPK:LYNS) on September 27, 2013.