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RCN filed for Chapter 11 bankruptcy protection yesterday. Looks like the bondholders get converted to new equity as expected.

RCN’s stock is effectively worthless under the plan as proposed. Holders of RCN’s existing preferred stock and common stock will receive, on a basis to be determined, equity warrants that are exercisable into two percent of reorganized RCN’s common stock (before giving effect to any management incentive plan), with a two-year term beginning on the consummation of a plan of reorganization, and set at a strike price equivalent to an enterprise valuation of $1.66 billion.

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