BLUESTAR COMMUNICATIONS GROUP, INC.

Case Highlights

• Coordinated customer migration with minimal interruption of service
• Negotiated funding mechanism to permit continued short-term operations

Case Narrative

BlueStar Communications Group, Inc., was a provider of broadband communications and Internet services to small and medium sized businesses in Tier II and Tier III markets.   Upon becoming insolvent, BlueStar effectuated an Assignment for the Benefit of Creditors in Nashville, Tennessee, and DSI was retained to assist with the liquidation of assets. In an effort to maximize value for creditors and minimize the interruption of service for customers, DSI negotiated with BlueStar’s parent to sell to it the right to migrate customers back on to its own networks.  As part of the deal, and in order to effectuate a migration, DSI worked with the Assignee and BlueStar’s parent to prepare a funding mechanism so that the operations could remain intact for a period of one month.  As part of this process, DSI worked with the ILECs, the FCC and the customers so as to promote as smooth a transition as possible.  During the period, DSI also worked closely with the Assignee to liquidate the remaining assets of the company.