ECLG Ecollege Common St (MM)

CHICAGO, Oct. 31 /PRNewswire-FirstCall/ -- eCollege(R) (NASDAQ:ECLG), a leading provider of value-added information services to the post-secondary education industry, today announced that it prepaid the $20 million outstanding principal of its senior subordinated notes, which were issued in October 2003 in connection with the acquisition of the Company's Enrollment Division, Datamark, Inc. The prepayment reduces the Company's long-term debt to approximately $500 thousand. The prepayment included $20 million of principal and $215 thousand of accrued interest, and will result in a one time, non-cash interest charge of $1.9 million in the fourth quarter of 2006. The non-cash interest charge includes approximately $1.5 million related to unamortized warrants and approximately $400 thousand related to unamortized debt issuance costs previously recorded as discount on the debt. The charge will reduce fourth quarter 2006 GAAP EPS by $0.05 after taxes and will increase fourth quarter adjusted EPS by $0.03 after taxes based on the estimated 23.3 million diluted shares. The prepayment will reduce the Company's 2007 interest expense by approximately $3.7 million, of which $2.5 million is cash interest and $1.2 million is non-cash interest related to warrants and amortization of debt issuance costs. "Consistent with our original objectives, we are very pleased to pay off the senior subordinated debt ahead of schedule," said Oakleigh Thorne, chairman and CEO of eCollege. "Our ability to pay off the debt early demonstrates our strong cash flow and our commitment to further de-lever our balance sheet." This prepayment of the senior subordinated notes is consistent with the Company's previous guidance for the fourth quarter of 2006. About eCollege eCollege (NASDAQ:ECLG) is a leading provider of value-added information services to the post-secondary and K-12 education industries. The Company's eLearning Division designs, builds and supports some of the most successful, fully online degree, certificate/diploma and professional development programs in the country. The Company's Enrollment Division, Datamark, Inc., helps institutions build new enrollments and increase student retention. Customers include publicly traded for-profit institutions, community colleges, public and private universities, school districts and state departments of education. eCollege was founded in 1996 and is headquartered in Chicago, with the eLearning Division headquartered in Denver. Datamark was founded in 1987 and is headquartered in Salt Lake City. For more information, visit http://www.ecollege.com/ and http://www.datamark.com/. This news release contains statements that are not historical in nature and that may be characterized as "forward-looking statements" within the meaning of the securities laws. Examples of these forward-looking statements would include statements about the Company's future operating results, cash flows and financial condition and any other statements that are not historical facts. These statements are based on management's current expectations and are subject to a number of uncertainties and risks. Actual performance and results may differ materially from those reflected in these forward-looking statements due to general financial, economic, regulatory and political conditions affecting the Company's industries as well as the more specific risks and uncertainties facing the Company, including those identified in the Company's reports on Form 10-K, Form 10-Q and Form 8-K filed with the U.S. Securities and Exchange Commission ("SEC"), which you are encouraged to review in connection with this release. You should not place undue reliance on forward-looking statements, which are based on current expectations and speak only as of the date of this release. We are not obligated to publicly release any revisions to forward-looking statements to reflect events after the date of this release. eCollege is a registered trademark of eCollege. DATASOURCE: eCollege CONTACT: Kristi Emerson of eCollege, +1-303-873-3788, Web site: http://www.ecollege.com/

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