Covad Communications Announces $215 Million Senior Note Offering.

SANTA CLARA, Calif.--(BUSINESS WIRE)--Feb. 12, 1999--Covad Communications Group, Inc. (Nasdaq:COVD) announces that it has agreed to sell 12 1/2% Senior Notes due 2009 (the "Notes") in the aggregate principal amount of $215 million.

The Notes will be sold to qualified institutional buyers in a private placement under Rule 144A under the Securities Act of 1933, as amended (the "Securities Act").

The company intends to use the net proceeds of the offering to primarily fund capital expenditures to be incurred in the deployment of the company's networks in existing and new regions, for expenses associated with continued development and sales and marketing activities, to fund operating losses, to provide working capital and for general corporate purposes, in addition, a portion of the net proceeds from the offering will be reserved to fund interest payments on the Notes for the next three years.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities. The securities will not be registered under the Securities Act or applicable state securities laws, and may not be offered or sold in the United States absent registration under the Securities Act and applicable state securities laws or available exemptions from such registration requirements.