8-K

UNITED STATES

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 (Date of earliest event reported): November 9, 2009

ITC^DeltaCom, Inc.

(Exact name of registrant as specified in its charter)

Delaware	0-23253	58-2301135
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

7037 Old Madison Pike Huntsville, Alabama	35806
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (256) 382-5900

Not applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2-(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.    Results of Operations and Financial Condition

On November 9, 2009, ITC^DeltaCom, Inc. (the “Company”) issued a news release announcing certain consolidated financial and operating results for the quarter ended September 30, 2009. A copy of the news release is furnished as Exhibit 99 to this Current Report on Form 8-K and incorporated herein by reference.

The information in this Current Report on Form 8-K, including Exhibit 99 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.

Item 9.01.    Financial Statements and Exhibits

(d) Exhibits

The Company herewith furnishes the following exhibit:

Exhibit Number	Description of Exhibit
99	News release dated November 9, 2009

2

SIGNATURE

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.

	ITC^DELTACOM, INC.
Date: November 12, 2009	/s/    J. THOMAS MULLIS
	J. Thomas Mullis Senior Vice President-Legal and Regulatory (Duly Authorized Officer)

3

INDEX EXHIBIT

Exhibit Number	Description of Exhibit
99	News release dated November 9, 2009

EX-99

Exhibit 99

Investor Contact:

Richard E. Fish

Chief Financial Officer

256-382-3827

Richard.fish@deltacom.com

FOR IMMEDIATE RELEASE

ITC^DELTACOM ANNOUNCES THIRD QUARTER 2009 RESULTS

Huntsville, Ala.—(November 9, 2009)— ITC^DeltaCom, Inc. (OTC: ITCD.OB), a leading provider of integrated communications services to customers in the southeastern United States, today announced its operating and financial results for the quarter ended September 30, 2009. For the 2009 third quarter, ITC^DeltaCom reported total operating revenues of $116.4 million, a net loss of $(2.1) million, and adjusted EBITDA* of $23.1 million.

“Since late 2008, the Company’s emphasis has been on adjusted EBITDA growth, increased cash flow, and cost containment, resulting in record adjusted EBITDA in successive quarters, despite the worsening economic downturn,” said Randall E. Curran, ITC^DeltaCom’s Chief Executive Officer. “We have also continued to invest in our network at the highest levels in this decade and are now emphasizing investments that position the Company for future revenue growth.”

Among its operating results for the third quarter of 2009, ITC^DeltaCom:

• recorded operating income of $5.3 million compared to operating income of $2.4 million for the third quarter of 2008 and a net loss of ($2.1) million compared to a net loss of ($5.3) million for the third quarter of 2008 and ($2.7) million for the second quarter of 2009;

• increased adjusted EBITDA, as defined by us, by 4.4% over the third quarter of 2008 and 7.0% over the second quarter of 2009 to $23.1 million;

• experienced a decrease in total operating revenues of $8.3 million, or 6.7%, from the third quarter of 2008 and $2.2 million, or 1.9%, from the second quarter of 2009;

• experienced a decrease in business local, data and Internet revenues of $3.9 million, or 4.5%, from the third quarter of 2008 and $2.2 million, or 2.6%, from the second quarter of 2009;

• ended the quarter with approximately 423,200 retail voice lines in service, of which 87.4% were provided on our own network, which represented an increase from 84.8% provided on our own network at the end of the third quarter of 2008;

• increased our core, facilities-based business retail voice lines in service by approximately 1,000 lines over the third quarter of 2008, while experiencing a decrease in total retail business voice lines in service of approximately 11,800 lines from the third quarter of 2008 due to a decline in resale and commercial agreement lines;

- 1 -

• continued to derive benefit from investments in process redesign and other efficiency gains, resulting in selling, operations and administration expense equal to 35.5% of total operating revenues compared to 36.0% of total operating revenues for the third quarter of 2008;

• generated $14.6 million in net cash provided by operating activities, which represented a decrease of $6.6 million from the third quarter of 2008 and a decrease of $6.8 million from the second quarter of 2009; and

• generated $12.8 million of adjusted unlevered free cash flow**, as defined by us, which represented a decrease of 9.2% from the third quarter of 2008, and an increase of 38.4% over the second quarter of 2009.

“We continue to reduce costs through network optimization and process improvements that will strengthen our business and enhance our customers’ experience,” said Richard E. Fish, ITC^DeltaCom’s Chief Financial Officer. “We’ve generated over $36 million of adjusted unleveraged free cash flow in the first nine months of 2009 and ended the quarter with cash and cash equivalents of $77.5 million.”

Additional information about ITC^DeltaCom’s business and operating results is contained in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2009 filed with the Securities and Exchange Commission.

* Adjusted EBITDA is defined by ITC^DeltaCom as net income (loss) before interest income and expense, net, provision for income taxes, depreciation and amortization, stock-based compensation, non-cash loss on extinguishment of debt, debt issue cost write-off, prepayment penalties on debt, equity commitment fees, restructuring expenses, merger-related expenses, asset impairment loss and other income or loss, all as disclosed in the consolidated statements of operations and comprehensive loss. Adjusted EBITDA is not a measurement of financial performance under generally accepted accounting principles. For a quantitative reconciliation of adjusted EBITDA to net loss, as net loss is calculated in accordance with generally accepted accounting principles, see the accompanying table captioned “Adjusted EBITDA Reconciliation.”

** Adjusted unlevered free cash flow is defined by ITC^DeltaCom as adjusted EBITDA (as defined above) less capital expenditures (including equipment purchased through capital leases) and changes in accounts payable – construction, all as disclosed in the consolidated statements of cash flows. Adjusted unlevered free cash flow is not a measurement of financial performance under generally accepted accounting principles. For a quantitative reconciliation of adjusted unlevered free cash flow to net cash provided by operating activities, as net cash provided by operating activities is calculated in accordance with generally accepted accounting principles, see the accompanying table captioned “Adjusted Unlevered Free Cash Flow Reconciliation.”

ABOUT ITC^DELTACOM, INC.

ITC^DeltaCom, Inc., headquartered in Huntsville, Alabama, provides, through its operating subsidiaries, integrated telecommunications and technology services to businesses and other communications providers in the southeastern United States. ITC^DeltaCom has a fiber optic network spanning 15,965 route miles, including more than 12,020 route miles of owned fiber, and offers a comprehensive suite of voice and data communications services, including local, long distance, broadband data, Internet connectivity, wireless voice and data services, and customer premise equipment. ITC^DeltaCom is one of the largest competitive telecommunications providers in its primary eight-state region. For more information about ITC^DeltaCom, visit ITC^DeltaCom’s web site at http://www.deltacom.com.

- 2 -

FORWARD-LOOKING STATEMENTS

Except for the historical and present factual information contained herein, this release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. When used in this release, the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan” and similar expressions as they relate to ITC^DeltaCom, Inc. or its management are intended to identify these forward-looking statements. All statements by the Company regarding its expected financial position, revenues, liquidity, cash flow and other operating results, balance sheet improvement, business strategy, financing plans, forecasted trends related to the markets in which it operates, legal proceedings and similar matters are forward-looking statements. The Company’s actual results could be materially different from its expectations because of various risks. These risks, some of which are discussed under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, and in the Company’s subsequent SEC reports, include the Company’s dependence on new product development, rapid technological and market changes, the Company’s dependence upon rights of way and other third-party agreements, debt service and other cash requirements, liquidity constraints and risks related to future growth and rapid expansion. Other important risk factors that could cause actual events or results to differ from those contained or implied in the forward-looking statements include, without limitation, customer attrition, delays or difficulties in deployment and implementation of colocation arrangements and facilities, appeals of or failures by third parties to comply with rulings of governmental entities, inability to meet installation schedules, general economic and business conditions, failure to maintain underlying service/vendor arrangements, competition, adverse changes in the regulatory or legislative environment, and various other factors beyond the Company’s control. ITC^DeltaCom disclaims any responsibility to update these forward-looking statements, whether as a result of new information, future developments or otherwise.

- 3 -

ITC^DeltaCom, Inc.

Financial Highlights

(Unaudited)

(In thousands, except share and per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2009			2008			2009			2008
OPERATING REVENUES:
Integrated communications services	$	97,668		$	103,398		$	299,797		$	311,224
Wholesale services		14,564			16,502			44,807			49,566
Equipment sales and related services		4,167			4,817			12,373			14,258
TOTAL OPERATING REVENUES		116,399			124,717			356,977			375,048
COSTS AND EXPENSES:
Cost of services and equipment, excluding depreciation and amortization		52,627			58,246			163,731			174,075
Selling, operations and administration		41,378			44,893			126,865			137,965
Depreciation and amortization		17,110			19,218			51,245			56,479
Total operating expenses		111,115			122,357			341,841			368,519
OPERATING INCOME		5,284			2,360			15,136			6,529
OTHER (EXPENSE) INCOME:
Interest expense		(7,453	)		(7,901	)		(22,544	)		(24,087	)
Interest income		9			273			38			1,149
Other income (expense)		43			(68	)		(89	)		360
Total other expense, net		(7,401	)		(7,696	)		(22,595	)		(22,578	)
LOSS BEFORE INCOME TAXES		(2,117	)		(5,336	)		(7,459	)		(16,049	)
INCOME TAX EXPENSE		—			—			—			—
NET LOSS		(2,117	)		(5,336	)		(7,459	)		(16,049	)
PREFERRED STOCK DIVIDENDS AND ACCRETION		—			—			—			(7,073	)
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS	$	(2,117	)	$	(5,336	)	$	(7,459	)	$	(23,122	)
BASIC AND DILUTED NET LOSS PER SHARE APPLICABLE TO COMMON STOCKHOLDERS	$	(0.03	)	$	(0.07	)	$	(0.09	)	$	(0.29	)
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		81,136,456			80,748,659			80,987,101			79,300,183
COMPREHENSIVE INCOME (LOSS)
NET LOSS	$	(2,117	)	$	(5,336	)	$	(7,459	)	$	(16,049	)
OTHER COMPREHENSIVE INCOME (LOSS)
Change in unrealized gains on derivative instrument designated as cash flow hedging instrument, net of tax		2,275			1,187			5,610			774
COMPREHENSIVE INCOME (LOSS)	$	158		$	(4,149	)	$	(1,849	)	$	(15,275	)

- 4 -

ITC^DeltaCom, Inc.

Quarterly Highlights

(Unaudited)

(In thousands)

	Three Months Ended
	Sept. 30, 2009		June 30, 2009		March 31, 2009		Dec. 31, 2008		Sept. 30, 2008
Integrated communications services revenues:
Long distance and access	$	15,375	$	15,529	$	16,021	$	16,312	$	17,229
Business local, data and internet		82,293		84,524		86,055		86,445		86,169
Total integrated communications services revenues		97,668		100,053		102,076		102,757		103,398
Wholesale services revenues:
Broadband transport		12,284		12,237		12,664		12,983		13,046
Local interconnection		181		308		740		1,034		1,193
Directory assistance and operator services		986		1,019		1,029		1,093		1,146
Other		1,113		1,061		1,185		1,122		1,117
Total wholesale services revenues		14,564		14,625		15,618		16,232		16,502
Equipment sales and related services revenues		4,167		3,925		4,281		3,826		4,817
Total operating revenues		116,399		118,603		121,975		122,815		124,717
COSTS AND EXPENSES:
Cost of services and equipment, excluding depreciation and amortization		52,627		54,627		56,477		58,824		58,246
Selling, operations and administration expense		41,378		41,817		43,670		45,158		44,893
Depreciation and amortization		17,110		17,216		16,919		17,035		19,218
Total operating expenses		111,115		113,660		117,066		121,017		122,357
OPERATING INCOME	$	5,284	$	4,943	$	4,909	$	1,798	$	2,360

- 5 -

ITC^DeltaCom, Inc.

Quarterly Highlights (continued)

(Unaudited)

	Sept. 30, 2009		June 30, 2009		March 31, 2009		Dec. 31, 2008		Sept. 30, 2008
Retail business voice lines in service(1)
UNE-T and other UNE lines(2)	369,752		372,413		369,787		369,496		368,724
Increase (decrease) from previous quarter	(0.7	)%	0.7	%	0.1	%	0.2	%	1.8	%
Resale and commercial agreement lines(3)	53,456		56,022		59,017		62,629		66,300
Decrease from previous quarter	(4.6	)%	(5.1	)%	(5.8	)%	(5.5	)%	(5.5	)%
Total retail business voice lines in service	423,208		428,435		428,804		432,125		435,024
Wholesale voice lines in service(4)	6,969		8,625		12,489		26,151		38,203
Decrease from previous quarter	(19.2	)%	(30.9	)%	(52.2	)%	(31.5	)%	(5.9	)%
Total business voice lines in service (5)	430,177		437,060		441,293		458,276		473,227
Number of employees (6)	1,437		1,452		1,511		1,565		1,615

(1) Lines in service include only voice lines in service. Conversion of data services provided to customers to a voice line equivalent is not included.

(2) Facilities-based service offering in which ITC^DeltaCom provides local service through its owned and operated switching facilities.

(3) Represent voice lines for local and mobile services provided under commercial agreements and by reselling incumbent local exchange carrier tariff offerings.

(4) Represents primary rate interface circuits provided as part of ITC^DeltaCom’s local interconnection services for Internet service providers.

(5) Reported net of lines disconnected or canceled.

(6) Includes full-time and part-time employees.

- 6 -

ITC^DeltaCom, Inc.

Balance Sheet and Other Financial Highlights

(In thousands)

Balance Sheet Data (at period end):	Sept. 30, 2009			December 31, 2008
	(Unaudited)
Cash and cash equivalents (unrestricted)	$	77,463		$	56,683
Working capital		51,172			33,902
Total assets		372,736			382,661
Long-term liabilities		305,064			307,880
Stockholders’ deficit		(12,568	)		(12,401	)
Total liabilities and stockholders’ deficit		372,736			382,661

	Three Months Ended
Other Financial Data:	Sept. 30, 2009			June 30, 2009			March 31, 2009			Dec. 31, 2008			Sept. 30, 2008
	(Unaudited)
Capital expenditures(1)	$	10,315		$	13,465		$	8,329		$	29,843		$	8,005
Cash flows (used in) provided by:
Operating activities		14,622			21,430			17,271			10,685			21,267
Investing activities		(10,385	)		(12,795	)		(6,792	)		(9,593	)		(33,257	)
Financing activities		(576	)		(581	)		(1,414	)		2,918			4,417
Adjusted EBITDA(2)		23,094			22,697			22,357			19,269			22,131
Adjusted unlevered free cash flow(3)		12,779			9,232			14,028			(10,574	)		14,126

- 7 -

ITC^DeltaCom, Inc.

Balance Sheet and Other Financial Highlights (continued)

(In thousands)

Notes:

(1) Includes equipment purchased through capital leases and changes in accrued capital related costs.

(2) Adjusted EBITDA is defined by ITC^DeltaCom as net income (loss) before interest income and expense, net, provision for income taxes, depreciation and amortization, stock-based compensation, non-cash loss on extinguishment of debt, debt issue cost write-off, prepayment penalties on debt, equity commitment fees, restructuring expenses, merger-related expenses, asset impairment loss and other income or loss, all as disclosed in the condensed consolidated statements of operations and comprehensive loss. Adjusted EBITDA is not a measurement of financial performance under generally accepted accounting principles. For a quantitative reconciliation of adjusted EBITDA to net loss, as net loss is calculated in accordance with generally accepted accounting principles, see the accompanying table captioned “Adjusted EBITDA Reconciliation.”

(3) Adjusted unlevered free cash flow is defined by ITC^DeltaCom as adjusted EBITDA, as defined above in Note (2), less capital expenditures (including equipment purchased through capital leases) and changes in accounts payable–construction, all as disclosed in the condensed consolidated statements of cash flows. Adjusted unlevered free cash flow is not a measurement of financial performance under generally accepted accounting principles. For a quantitative reconciliation of adjusted unlevered free cash flow to net cash provided by operating activities, as net cash provided by operating activities is calculated in accordance with generally accepted accounting principles, see the accompanying table captioned “Adjusted Unlevered Free Cash Flow Reconciliation.”

- 8 -

ITC^DeltaCom, Inc.

Adjusted EBITDA Reconciliation

(In thousands)

(Unaudited)

Adjusted EBITDA is defined by ITC^DeltaCom as net income (loss) before interest income and expense, net, provision for income taxes, depreciation and amortization, stock-based compensation, non-cash loss on extinguishment of debt, debt issue cost write-off, prepayment penalties on debt, equity commitment fees, restructuring expenses, merger-related expenses, asset impairment loss and other income or loss, all as disclosed in the condensed consolidated statements of operations and comprehensive loss. Not all of these adjustments are applicable in every period. Adjusted EBITDA is not a financial measurement under generally accepted accounting principles (“GAAP”). ITC^DeltaCom’s management uses adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as revenue, to assess ITC^DeltaCom’s historical and prospective operating performance. Management uses adjusted EBITDA to enhance its understanding of ITC^DeltaCom’s core operating performance, which represents management’s views concerning ITC^DeltaCom’s performance in the ordinary, ongoing and customary course of its operations. ITC^DeltaCom’s management also uses adjusted EBITDA to evaluate ITC^DeltaCom’s core operating performance relative to that of its competitors. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Adjusted EBITDA” in ITC^DeltaCom’s Annual Report on Form 10-K for its 2008 fiscal year for additional information regarding management’s reasons for including adjusted EBITDA data and for material limitations with respect to the usefulness of this measure. The following tables present adjusted EBITDA amounts for the fiscal quarters indicated and also sets forth a quantitative reconciliation of adjusted EBITDA to net loss, as net loss is calculated in accordance with GAAP (in thousands):

	Three Months Ended
	Sept.30, 2009			June 30, 2009			March 31, 2009			Dec. 31, 2008			Sept. 30, 2008
	(Unaudited)
Net loss	$	(2,117	)	$	(2,746	)	$	(2,596	)	$	(6,848	)	$	(5,336	)
Add: non-EBITDA items included in net loss:
Interest income and expense, net		7,444			7,538			7,524			8,367			7,628
Depreciation and amortization		17,110			17,216			16,919			17,035			19,218
Stock-based compensation		700			538			529			436			553
Other (income) loss		(43	)		151			(19	)		279			68
Adjusted EBITDA	$	23,094		$	22,697		$	22,357		$	19,269		$	22,131

- 9 -

ITC^DeltaCom, Inc.

Adjusted Unlevered Free Cash Flow Reconciliation

(In thousands)

(Unaudited)

Adjusted unlevered free cash flow is defined by ITC^DeltaCom as adjusted EBITDA (as defined above) less capital expenditures (including equipment purchased through capital leases) and changes in accounts payable–construction, all as disclosed in the condensed consolidated statements of cash flows. Adjusted unlevered free cash flow is not a measurement of financial performance under GAAP. ITC^DeltaCom has included data with respect to adjusted unlevered free cash flow because its management considers adjusted unlevered free cash flow to be a useful, supplemental indicator of its operating performance. When measured over time, adjusted unlevered free cash flow provides supplemental information to investors concerning the growth rate in ITC^DeltaCom’s operating results and its ability to generate cash flows to satisfy mandatory debt service requirements and make other mandatory, non-discretionary expenditures. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Adjusted Unlevered Free Cash Flow” in ITC^DeltaCom’s Annual Report on Form 10-K for its 2008 fiscal year for additional information regarding management’s reasons for including adjusted unlevered free cash flow data and for material limitations with respect to the usefulness of this measure. The following tables present adjusted unlevered free cash flow amounts for the fiscal quarters indicated and also sets forth a quantitative reconciliation of adjusted unlevered free cash flow to net cash provided by operating activities, as net cash provided by operating activities is calculated in accordance with GAAP (in thousands):

	Three Months Ended
	Sept. 30, 2009			June 30, 2009			March 31, 2009			Dec. 31, 2008			Sept. 30, 2008
	(Unaudited)
Net cash provided by operating activities	$	14,622		$	21,430		$	17,271		$	10,685		$	21,267
Adjustments to reconcile adjusted unlevered free cash flow to net cash provided by operating activities
Elements included in net cash provided by (used in) operating activities not included in adjusted unlevered free cash flow:
Total changes in current operating assets and liabilities		2,858			(4,671	)		(154	)		2,025			(5,204	)
Provision for doubtful accounts		(1,225	)		(1,050	)		(1,680	)		(1,200	)		(950	)
Interest expense excluding amortization of debt issuance costs and debt discount, net of interest income		6,839			6,932			6,917			7,759			7,018
Other loss		—			56			3			—			—
Adjusted EBITDA		23,094			22,697			22,357			19,269			22,131
Less:
Capital expenditures		(10,437	)		(12,490	)		(10,096	)		(22,063	)		(15,486	)
Change in accounts payable – construction		122			(975	)		1,767			(7,780	)		7,481
Adjusted unlevered free cash flow	$	12,779		$	9,232		$	14,028		$	(10,574	)	$	14,126

- 10 -