News: Senior Debt Financing -- ConnectSouth

ConnectSouth Communications, Inc., a leading provider of high-speed connectivity and Internet business tools for businesses in traditionally underserved communities across the Southern United States, announced today that it has raised an additional $125 million in Senior Debt Financing from Morgan Stanley Dean Witter, First Union, Bank of America and CIT. The financing will allow the company to fully fund the completion of their aggressive network deployment and provision of application services to 41 markets by the end of this year.

This round of financing is in addition to an initial $100 million in equity funding secured in October 1999 from Morgan Stanley Dean Witter Private Equity, Fleet Equity Partners and Waller-Sutton Media Partners.

"The ability to secure $125 million in Senior Debt funding validates the strength of ConnectSouth’s business model in equipping customers with the solutions necessary to compete in an increasingly Internet-centric environment," said Helen Chan, an analyst at the Yankee Group. "They offer high-speed DSL access coupled with web-hosting and other applications to small and medium-sized businesses in Tier 2 to Tier 4 markets, which have not had access to such services in the past."

Jeff Mucci, ConnectSouth Chairman and CEO stated, "This second financing is another important step and vote of confidence in our business development and ability to execute our business plan." Mr. Mucci went on to say, "We continue to exceed our forecasts for customer acquisition and in the build-out of our network. With $225 million of total funding, ConnectSouth is well positioned to be the leading integrated communications provider in the Sun Belt region."

ConnectSouth was founded in 1999 to bridge the digital divide that has prevented smaller businesses outside of major metropolitan areas from taking full advantage of the Internet. ConnectSouth service is currently available to more than 200,000 businesses in select cities in Texas, Oklahoma, Louisiana, Mississippi and Alabama. By the end of 2000, ConnectSouth will reach 41 markets as the company expands to cities in all five states of the Southwestern Bell territory and in 9 of 12 states in Bell South territory.

	PRESS RELEASES ConnectSouth Announces $125 Million of Senior Debt Financing. Second Round of Financing Fully Funds Initial Forty-One Market Business Plan.

		June 13, 2000

		ConnectSouth Communications, Inc., a leading provider of high-speed connectivity and Internet business tools for businesses in traditionally underserved communities across the Southern United States, announced today that it has raised an additional $125 million in Senior Debt Financing from Morgan Stanley Dean Witter, First Union, Bank of America and CIT. The financing will allow the company to fully fund the completion of their aggressive network deployment and provision of application services to 41 markets by the end of this year. This round of financing is in addition to an initial $100 million in equity funding secured in October 1999 from Morgan Stanley Dean Witter Private Equity, Fleet Equity Partners and Waller-Sutton Media Partners. "The ability to secure $125 million in Senior Debt funding validates the strength of ConnectSouth’s business model in equipping customers with the solutions necessary to compete in an increasingly Internet-centric environment," said Helen Chan, an analyst at the Yankee Group. "They offer high-speed DSL access coupled with web-hosting and other applications to small and medium-sized businesses in Tier 2 to Tier 4 markets, which have not had access to such services in the past." Jeff Mucci, ConnectSouth Chairman and CEO stated, "This second financing is another important step and vote of confidence in our business development and ability to execute our business plan." Mr. Mucci went on to say, "We continue to exceed our forecasts for customer acquisition and in the build-out of our network. With $225 million of total funding, ConnectSouth is well positioned to be the leading integrated communications provider in the Sun Belt region." ConnectSouth was founded in 1999 to bridge the digital divide that has prevented smaller businesses outside of major metropolitan areas from taking full advantage of the Internet. ConnectSouth service is currently available to more than 200,000 businesses in select cities in Texas, Oklahoma, Louisiana, Mississippi and Alabama. By the end of 2000, ConnectSouth will reach 41 markets as the company expands to cities in all five states of the Southwestern Bell territory and in 9 of 12 states in Bell South territory. About ConnectSouth

	ConnectSouth Communications, Inc., headquartered in Austin, Texas, is an "e-enabler," providing a full range of high-speed connectivity and Internet business application tools for small- and medium-sized businesses in traditionally underserved cities and towns in the Southern Region of the United States.