CBEY Cbeyond, Inc. (MM)

NOTICE OF ANNUAL MEETING

TO BE HELD JULY 9, 2014

The 2014 annual meeting of stockholders of Cbeyond will be held on Wednesday, July 9, 2014, at 9:30 a.m., local time, at the Hyatt House, 3595 Cumberland Boulevard Southeast, Atlanta, Georgia 30339, for the following purposes:

1. To consider and vote on a proposal to adopt the Agreement and Plan of Merger, dated as of April 19, 2014, as it may be amended from time to time (the “Merger Agreement”), by and among Cbeyond, Birch Communications, Inc., a Georgia corporation (“Birch”), and Hawks Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Birch (“Merger Sub”) and approve the Merger and other transactions contemplated by the Merger Agreement;

2. To approve, on an advisory non-binding basis, the compensation that may be paid or become payable to the named executive officers of Cbeyond in connection with the Merger;

3. To approve the adjournment of the annual meeting, if necessary or appropriate, including to solicit additional votes in favor of the proposal to adopt the Merger Agreement if there are insufficient votes at the time of the annual meeting to approve the proposal to adopt the Merger Agreement;

4. To elect two Class III directors to hold office until the effective time of the Merger or, if the Merger is not completed, until the 2017 Annual Meeting of Stockholders (or until such time as their respective successors are elected and qualified or their earlier resignation, death, or removal from office);

5. To ratify the appointment by the Audit Committee of Ernst & Young LLP as Cbeyond’s independent registered public accounting firm for the fiscal year ending December 31, 2014;

6. To approve, on an advisory non-binding basis, the compensation that was paid to Cbeyond’s named executive officers; and

7. To transact such other business as may properly come before the Annual Meeting and any adjournment or postponement thereof.

The foregoing matters are described in more detail in the enclosed proxy statement.

The Board of Directors has fixed June 2, 2014 as the record date for determining stockholders entitled to vote at the annual meeting or any adjournments thereof.

You are cordially invited to attend the annual meeting in person. Your participation in these matters is important, regardless of the number of shares you own. Whether or not you expect to attend in person, we urge you to vote your shares online or by mail by completing and returning the accompanying proxy card as promptly as possible to ensure your shares are voted at the meeting. If you choose to attend the meeting you may then vote in person if you so desire, even though you may have executed and returned the proxy. Any stockholder who executes such a proxy may revoke it at any time before it is exercised. A proxy may be revoked at any time before it is exercised by delivering written notice of revocation to Cbeyond, Attention: William Weber, General Counsel; by delivering a duly executed proxy bearing a later date to Cbeyond; or by attending the annual meeting and voting in person.

By Order of the Board of Directors,

J. Robert Fugate, Chief Financial Officer

June 5, 2014

Atlanta, Georgia

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND THE MERGER

The following questions and answers briefly address some commonly asked questions about the annual meeting, the Merger Agreement and the Merger. These questions and answers do not contain all of the details that may be important to you as a stockholder of Cbeyond. Therefore, Cbeyond encourages you to carefully read this entire proxy statement, its annexes and the documents referred to or incorporated by reference in this proxy statement. You may obtain the information incorporated by reference without charge by following the instructions under “Where You Can Find More Information” on page 127 of this proxy statement. In this proxy statement, unless the context requires otherwise, the term “Cbeyond” refers to Cbeyond, Inc., a Delaware corporation, and its subsidiaries. The term “Birch” refers to Birch Communications, Inc., a Georgia corporation, and the term “Merger Sub” refers to Hawks Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Birch. The term “Merger Agreement” refers to the Agreement and Plan of Merger, dated as of April 19, 2014, as it may be amended from time to time, by and among Cbeyond, Birch and Merger Sub. Unless the context requires otherwise, the terms “you” and the “Cbeyond stockholders” refer to holders of Cbeyond’s common stock, par value $0.01 per share.

Q. Why is Cbeyond sending this proxy statement and proxy card?

A. On April 19, 2014, Cbeyond entered into the Merger Agreement providing for the merger of Merger Sub with and into Cbeyond, with Cbeyond surviving as a privately-held, wholly-owned subsidiary of Birch (the “Merger”). Cbeyond’s Board of Directors, which we refer to as the “Board of Directors” or the “Board”, is soliciting the vote of the Cbeyond Stockholders to approve the proposal to adopt the Merger Agreement and approve the Merger and other transactions contemplated by the Merger Agreement and the other matters to be voted on at the annual meeting. The Merger cannot occur without the required approval of the Cbeyond Stockholders.

Q. When and where is the annual meeting?

A. The annual meeting will take place on Wednesday, July 9, 2014 at 9:30 a.m., local time. The location of the annual meeting is the Hyatt House, 3595 Cumberland Boulevard Southeast, Atlanta, Georgia 30339.

Q. Who may attend and vote at the annual meeting?

A. All holders of Cbeyond’s common stock as of the record date for the annual meeting, which is June 2, 2014, are entitled to receive notice of, attend the annual meeting or any adjournment or postponement thereof and vote at the annual meeting.

You are entitled to attend the annual meeting only if you were a Cbeyond stockholder as of the close of business on June 2, 2014 or hold a valid proxy for the annual meeting. For directions to the annual meeting, please call Cbeyond’s Investor Relations at (678) 424-2400.

Q. What matters will be voted on at the annual meeting?

A. At the annual meeting, holders of Cbeyond’s common stock present in person or represented by proxy and entitled to vote will be asked:

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If the Cbeyond stockholders approve the proposal to adopt the Merger Agreement and the Merger is completed, Cbeyond will become a wholly-owned subsidiary of Birch at the effective time of the Merger.

Q. Why am I being asked to cast a non-binding advisory vote to approve the compensation that may be paid or become payable to the named executive officers of Cbeyond in connection with the Merger?

A. Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires Cbeyond to conduct a non-binding advisory vote with respect to certain “golden parachute” compensation that may be paid or become payable to Cbeyond’s named executive officers in connection with the Merger, including the agreements and understandings with Cbeyond pursuant to which such compensation may be paid or become payable.

Q. If the Merger is completed, what will I be entitled to receive for my shares, my restricted stock or my options?

A. If the Merger is completed, holders of Cbeyond’s common stock at the effective time of the Merger will be entitled to receive $10.00 in cash (the “Per Share Merger Consideration”) for each share of common stock they own, subject to potential reduction to an amount expected to be no less than $9.97 based on the actual number of shares of Cbeyond common stock (including Cbeyond restricted stock) and Cbeyond stock options outstanding at the effective time of the Merger and the maximum amount of aggregate consideration that Birch has agreed to pay pursuant to the Merger Agreement. The Per Share Merger Consideration will be payable in cash, without interest, and subject to any withholding taxes required by applicable law. The parties have agreed that the aggregate consideration to be paid by Birch with respect to Cbeyond’s common stock, restricted stock and stock options (the “Aggregate Merger Consideration”) will not exceed the sum of (i) $323,426,610, plus (ii) the aggregate of the exercise prices of any Cbeyond stock options exercised after April 17, 2014, net of applicable withholding taxes, and prior to the closing date, plus (iii) any Per Share Merger Consideration to be paid for shares of Cbeyond restricted stock issued to non-employee directors after April 19, 2014, in the ordinary course of Cbeyond’s business (the “Merger Consideration Cap”). Accordingly, if a Per Share Merger Consideration equal to $10.00 would result in Birch paying Aggregate Merger Consideration of more than the Merger Consideration Cap, then the Per Share Merger Consideration will be reduced (rounded down to the nearest cent) to the highest amount possible which results in Aggregate Merger Consideration amount equal to or less than the Merger Consideration Cap.

If a Per Share Merger Consideration of $10.00 would result in the Aggregate Merger Consideration exceeding the Merger Consideration Cap, the actual Per Share Merger Consideration payable by Birch will be calculated as follows: (i) sum of (A)  $323,426,610 plus (B) the aggregate exercise prices of Cbeyond stock options outstanding immediately prior to the effective time of the Merger, divided by (ii) the sum of (A) the number of shares of Cbeyond common stock (excluding shares of Cbeyond restricted stock) outstanding immediately prior to the effective time of the Merger, plus (B) the number of shares of Cbeyond restricted stock subject to time-based vesting outstanding immediately prior to the effective time of the Merger, plus (C) the number of shares of Cbeyond restricted stock subject to performance-based vesting for which the performance

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goals (measured as of the effective time of the Merger) are met, plus (D) the number of shares of Cbeyond common stock issuable upon the exercise of any Cbeyond stock option outstanding immediately prior to the effective time of the Merger. As of June 2, 2014, the record date, there are 30,984,631 shares of Cbeyond common stock (excluding shares of Cbeyond restricted stock) outstanding, 1,154,293 shares of Cbeyond restricted stock subject to time-based vesting, 203,500 shares of Cbeyond restricted stock subject to performance-based vesting (based on a “target” level of achievement), 308,400 shares of Cbeyond common stock issuable upon the exercise of outstanding “in-the-money” Cbeyond stock options and the aggregate exercise price of such “in-the-money” Cbeyond stock options is $2,367,848. Cbeyond expects to issue an aggregate amount of 90,000 shares of Cbeyond restricted stock to non-employee directors on June 7, 2014, which shares of Cbeyond restricted stock will vest on the first anniversary of the date of grant, provided that, in the event of the closing of the Merger, a pro-rated portion of the awards will vest and any remaining restricted shares subject to these awards will be forfeited to Cbeyond immediately prior to the closing of the Merger.

Based on the information available as of June 2, 2014, the record date, Cbeyond believes that the Per Share Merger Consideration will be no less than $9.97.

All outstanding and unexercised stock options (as of immediately prior to the effective time of the Merger) will become fully vested immediately prior to the effective time of the Merger, will be cancelled in the Merger in exchange for the right to receive in cash an amount equal to the product of (i) the total number of shares of Cbeyond common stock subject to the stock option multiplied by (ii) the excess, if any, of the Per Share Merger Consideration over the exercise price of the option, less any applicable withholding taxes.

The Merger Agreement provides that, to the extent subject to time-based vesting, each share of Cbeyond restricted stock outstanding and unvested immediately prior to the effective time of the Merger will become fully vested, and the holders of such outstanding shares will receive the same Per Share Merger Consideration in the Merger as other holders of Cbeyond’s common stock, less any applicable withholding taxes. The Merger Agreement also provides that, to the extent subject to performance-based vesting, each share of Cbeyond restricted stock outstanding and unvested immediately prior to the effective time of the Merger will become fully vested, the applicable performance goals will be measured as of the effective time of the Merger and, to the extent such goals are met, the holders of such outstanding shares will receive the same Per Share Merger Consideration in the Merger as other holders of Cbeyond’s common stock, less any applicable withholding taxes.

Stockholders that are entitled to and properly perfect their appraisal rights under Delaware law will be entitled to an appraisal by the Delaware Court of Chancery of the fair value of their shares of common stock in lieu of the Per Share Merger Consideration that such stockholders would otherwise be entitled to receive pursuant to the Merger Agreement.

Q. Will the Merger be a taxable transaction to me?

A. Yes. If you are a U.S. holder, the exchange of shares of Cbeyond’s common stock for cash pursuant to the Merger will generally be taxable for U.S. federal income tax purposes. If you are a U.S. holder, other than a U.S. holder who received shares of Cbeyond’s common stock in a compensatory arrangement, and your shares of Cbeyond’s common stock are converted into the right to receive cash in the Merger, you will generally recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received with respect to such shares (determined before deduction of any applicable withholding taxes) and your adjusted tax basis in such shares. The exchange of shares of Cbeyond’s common stock for cash pursuant to the Merger will generally not result in a non-U.S. holder being subject to U.S. federal income tax unless the non-U.S. holder has certain connections to the United States, but may be a taxable transaction under foreign tax laws. You should read “The Merger—Material U.S. Federal Income Tax Consequences” beginning on page 64 of this Proxy Statement for a more detailed discussion of the U.S. federal income tax consequences of the Merger to U.S. holders and non-U.S. holders. You should also consult your tax advisor for a complete analysis of the effect of the Merger on your U.S. federal, state and local and/or non-U.S. taxes, particularly if you received shares in a compensatory arrangement.

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Q. What tax consequences will there be on my options and restricted stock?

A. If your outstanding restricted stock vests immediately prior to the effective time of the Merger, then you will generally recognize taxable income equal to the cash payment you receive for your stock. This will be treated as ordinary compensation income for income tax purposes and subject to income and other payroll tax withholding. Unvested restricted stock that is terminated or forfeited prior to closing (pursuant to termination of employment or otherwise) will not be entitled to any consideration at the close of the Merger.

If you already recognized ordinary income on your restricted stock at the time the stock vested, then you will generally recognize a capital gain or loss equal to the difference between the income you previously recognized and the amount paid for the stock in the Merger. The capital gain or loss will be long term if more than one year has expired between the time you recognized the income and the Merger. Holders of such vested restricted stock generally will not be subject to income or other payroll tax withholding on any such capital gain.

If you have not exercised your unexpired stock options prior to the Merger, then the payment you receive in the Merger for your options (whether or not the options were previously vested) will be ordinary compensation income for income tax purposes and subject to income and other payroll tax withholding. Unvested stock options that expire prior to the Merger (pursuant to termination of employment or otherwise) will not be entitled to any consideration at the close of the Merger.

If you have previously exercised your options, you recognized ordinary income at the time of exercise equal to the difference between the value of Cbeyond stock at such time and the exercise price. If you still hold the shares acquired upon the option exercise, generally, the difference between the amount paid for your stock in the Merger and the value of Cbeyond stock at the time you previously exercised the option will be a capital gain or loss and will be long term if more than one year has expired between the date you exercised the option and the date of closing. Holders of stock received pursuant to an option exercise generally will not be subject to income or other payroll tax withholding on any such capital gain.

Q. What effect will the Merger have on Cbeyond and its common stock?

A. Cbeyond’s common stock is currently registered under the Exchange Act and is quoted on the NASDAQ Global Select Market (“NASDAQ”) under the symbol “CBEY”. As a result of the Merger, Cbeyond will become a privately-held, wholly-owned subsidiary of Birch. As a private company following the completion of the Merger, the registration of Cbeyond’s common stock and Cbeyond’s obligation to file reports and make other public disclosures with the Securities and Exchange Commission (the “SEC”) under the Exchange Act will be terminated, and Cbeyond’s common stock will no longer be listed on NASDAQ.

Q. How does Cbeyond’s Board of Directors recommend that I vote on the proposals?

A. After careful consideration, Cbeyond’s Board of Directors determined that that the Merger and the transactions contemplated by the Merger Agreement are advisable, substantively and procedurally fair to, and in the best interests of Cbeyond and its stockholders and has unanimously authorized, accepted, approved and adopted the Merger Agreement and the transactions contemplated therein, including the Merger.

Accordingly, Cbeyond’s Board of Directors recommends that you vote:

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In addition, the Board of Directors, based on recommendations from its Audit, Corporate Governance and Nominating and Compensation Committees, recommends that you vote:

To review the Board’s reasons for recommending the Merger, see the section entitled “The Merger—Reasons for the Merger and Recommendation of Cbeyond’s Board of Directors” beginning on page 44 of this proxy statement.

Q. Do any of Cbeyond’s directors and executive officers have interests in the Merger that may differ from or be in addition to my interests as a stockholder?

A. Yes. In considering the recommendation of Cbeyond’s Board of Directors with respect to the proposal to adopt the Merger Agreement and approve the Merger and other transactions contemplated by the Merger Agreement, you should be aware that Cbeyond’s directors and executive officers have interests in the Merger that are different from, or in addition to, the interests of Cbeyond’s stockholders generally. Cbeyond’s Board of Directors was aware of and considered these interests, among other matters, in evaluating and negotiating the Merger Agreement and the Merger, and in recommending that the Merger Agreement be adopted by the stockholders of Cbeyond. See the section entitled “The Merger—Interests of Cbeyond’s Directors and Executive Officers in the Merger” beginning on page 57 of this proxy statement.

Q. What vote is required for the proposals?

A. The affirmative vote by holders of at least a majority of the outstanding shares of Cbeyond’s common stock is required for the adoption of the Merger Agreement (Proposal No. 1).

Proposal Nos. 2, 3, 5 and 6 require the affirmative vote of at least a majority of the shares of Cbeyond’s common stock, present in person or represented by proxy and entitled to vote at the annual meeting.

Nominees for election to the Cbeyond Board of Directors (Proposal No. 4) shall be elected by a plurality of the votes cast by holders of Cbeyond’s common stock present in person or by proxy at the Annual Meeting.

As of June 2, 2014, there were 32,444,174 shares of Cbeyond common stock outstanding.

Q. What is a quorum?

A. In accordance with Cbeyond’s bylaws, in order for any matter to be considered at the annual meeting, there must be a quorum present. The presence of the holders of a majority of the voting power of the outstanding shares of Cbeyond entitled to vote generally in the election of directors represented in person or by proxy, shall constitute a quorum at a meeting of stockholders, except that when specified business is to be voted on by a class or series voting separately as a class or series, the holders of a majority of the voting power of the shares of such class or series shall constitute a quorum for the transaction of such business. The chairman of the meeting or a majority of the shares of outstanding common stock so represented may adjourn the meeting from time to time, whether or not there is such a quorum (or, in the case of specified business to be voted on by a class or series, the chairman or a majority of the shares of such class or series so represented may adjourn the meeting with respect

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to such specified business). No notice of the time and place of adjourned meetings need be given except as required by law. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

Q. What is the difference between holding shares as a stockholder of record and as a beneficial owner?

A. If your shares are registered directly in your name with Cbeyond’s transfer agent, American Stock Transfer & Trust Company, you are considered, with respect to those shares, the “stockholder of record.” The proxy materials have been sent to you directly by Cbeyond.

If your shares are held in a stock brokerage account or by a broker, bank or other nominee, you are considered the “beneficial owner” of shares held in “street name.” The proxy materials have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank or other nominee on how to vote your shares by following the voting instructions on the form that you receive from your broker, bank or other nominee.

Q. How do I vote?

A. If you are a stockholder of record, you may vote your shares of common stock:

If your shares are held in street name through a brokerage account, bank or other nominee, you must provide your voting instructions in accordance with the voting instruction form provided by your broker, bank or other nominee. The availability of Internet voting will depend on your broker’s, bank’s or other nominee’s voting process.

Stockholders of record may vote in person at the annual meeting, either by attending the meeting yourself or authorizing a representative to attend the meeting on your behalf. If you are designating a representative, you must execute a proper proxy designating that person. If you are a beneficial owner of shares, in order to be able to vote in person at the annual meeting you must obtain a legal proxy from your broker, bank or other nominee naming you as the proxy holder and present it to the inspector of election with your ballot when you vote at the annual meeting.

Q. If my shares are held in “street name” by my broker, bank or other nominee, will my broker, bank or other nominee vote my shares for me?

A. Other than for Proposal No. 5, your broker, bank or other nominee will only be permitted to vote your shares if you instruct your broker, bank or other nominee how to vote. You should follow the procedures provided by your broker, bank or other nominee regarding the voting of your shares. If you do not instruct your broker, bank or other nominee to vote your shares, your shares will not be voted, which will be treated as a vote against the proposal to adopt the Merger Agreement.

Q. How are votes counted?

A. For each of Proposal Nos. 1, 2, 3, 5 and 6 you may vote “FOR,” “AGAINST” or “ABSTAIN.” For Proposal No. 4, you may vote “FOR” one or more specified nominees or you may “WITHHOLD” your vote for all nominees.

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As noted above, shares held by stockholders attending the annual meeting but not voting, shares represented by proxies that reflect abstentions as to a particular proposal and broker non-votes will be counted as present for purposes of determining a quorum.

If the Cbeyond stockholders of record neither submit a vote by proxy nor vote in person at the annual meeting, their shares will not be voted. If a Cbeyond stockholder holds shares beneficially in street name and does not return the voting instruction form received from their broker, bank or other nominee, the holder’s broker may not vote uninstructed shares on Proposal Nos. 1, 2, 3, 4 or 6, but may vote, in its discretion, on Proposal No. 5. When a broker is not permitted to vote a client’s uninstructed shares on some but not all of the proposals at a meeting, the missing votes are referred to as “broker non-votes.” Broker non-votes will have no effect on Proposal Nos. 2, 3, 4 or 6, but will have the effect of a vote “AGAINST” Proposal No. 1.

Abstentions will have the same effect as a vote “AGAINST” Proposal Nos. 1, 2, 3, 5 and 6. “WITHHOLD” votes will have no effect on the result of the votes on the election of directors for Proposal No. 4.

Q. What if I don’t vote for a proposal on the proxy I submit?

A. Unless you give other instructions on your proxy that you submit, or unless you give other instructions when you submit your proxy by Internet, the persons named as proxies will vote your shares:

If any other business properly comes before the meeting or any adjournments or postponements thereof, the persons named as proxies will vote your shares in accordance with the recommendations of Cbeyond’s Board of Directors.

If you are the beneficial owner of shares and do not give voting instructions to your broker, bank or other nominee on a proposal, your shares will not be voted on any proposal other than Proposal No. 5.

Q. When should I send in my proxy or voting instructions?

A. You should send in your proxy card via mail, or submit your proxy over the Internet as soon as possible so that your shares will be voted at the annual meeting.

If your shares are held in the name of a broker, bank or other nominee, you should submit your voting instructions to your broker, bank or other nominee as soon as possible so that your shares will be voted at the annual meeting.

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Q. May I revoke my proxy or voting instructions?

A. Yes. You may revoke your proxy at any time before the annual meeting by any of the following methods. First, you can send a written, dated notice to the Secretary of Cbeyond, at Cbeyond, Inc., 320 Interstate North Parkway, Suite 500, Atlanta, Georgia 30339, Attention: Secretary, stating that you revoke your proxy. Second, you can complete and submit a new, later-dated proxy by mail or over the Internet. Third, you can attend the meeting and vote in person. Your attendance at the annual meeting alone will not revoke your proxy. If you have instructed a broker, bank or other nominee to vote your shares, the procedures for changing your voting instructions described above will not apply and you must instead follow the directions received from your broker, bank or other nominee to change those instructions.

Q. What does it mean if I receive more than one proxy card or set of proxy materials?

A. If you own stock in more than one brokerage account or stock that is registered under different names, you may receive more than one proxy card and more than one set of proxy materials. For example, a stockholder may own some shares directly as a stockholder of record and other shares through a broker, bank or other nominee or through more than one broker, bank or other nominee. In these situations, the stockholder will receive multiple sets of proxy materials. The Cbeyond stockholders must vote, sign and return all of the proxy cards or follow the instructions for the submission of proxies by Internet on each of the proxy cards that the stockholder receives in order to vote all of the shares. Each proxy card a Cbeyond stockholders receives comes with its own postage pre-paid return envelope. When returning multiple proxy cards by mail, each proxy card should be returned separately in the return envelope that accompanies that proxy card.

Q. What happens if the meeting is postponed or adjourned?

A. Unless a new record date is fixed, your proxy will still be valid and may be voted at the postponed or adjourned meeting. You will still be able to change or revoke your proxy at any time until it is voted.

Q. Am I entitled to appraisal rights?

A. The Cbeyond stockholders who do not vote in favor of the proposal to adopt the Merger Agreement are entitled to appraisal rights under Delaware law in connection with the Merger, provided such rights are properly perfected. Stockholders must comply with the requirements of Section 262 of the Delaware General Corporation Law, as amended, which is referred to in this proxy statement as the DGCL, in order to be entitled to have the “fair value” (as described in Section 262 of the DGCL) of their shares of common stock determined by the Court of Chancery of the State of Delaware and to receive payment based on that valuation instead of receiving the Per Share Merger Consideration. The ultimate amount stockholders would receive in an appraisal proceeding may be more than, the same as or less than the Per Share Merger Consideration. To exercise appraisal rights, stockholders must comply with the requirements of the DGCL. See the section entitled “The Annual Meeting—Appraisal Rights” beginning on page 25 of this proxy statement and the text of the Delaware appraisal rights statute, Section 262 of the DGCL, which is reproduced in its entirety as Annex C to this proxy statement.

Q. Is the Merger subject to the satisfaction of any conditions?

A. Yes. In addition to the approval of the proposal to adopt the Merger Agreement by the Cbeyond stockholders, the Merger is subject to the satisfaction of various conditions. For a description of these conditions, please see the section entitled “Proposal No. 1—The Merger Agreement—Conditions to the Merger” beginning on page 77 of this proxy statement.

Q. When is the Merger expected to be completed?

A. The parties to the Merger Agreement are working to complete the Merger as quickly as possible. In order to complete the Merger, Cbeyond must obtain the approval of the Cbeyond stockholders to adopt the Merger Agreement as described in this proxy statement, and the other closing conditions under the Merger Agreement

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must be satisfied, including the receipt of applicable regulatory approvals. Cbeyond currently expects to complete the Merger in the third quarter of 2014. Cbeyond cannot assure you that the Merger will be completed by any particular date.

Q. What happens if the Merger is not completed?

A. If the proposal to adopt the Merger Agreement is not approved by the Cbeyond stockholders, or if the Merger is not consummated for any other reason, Cbeyond’s stockholders will not receive any payment for their shares in connection with the Merger. Instead, Cbeyond will remain a public company and its shares of common stock will continue to be listed and traded on NASDAQ. In addition, under certain circumstances specified in the Merger Agreement, Cbeyond may be obligated to pay Birch a termination fee of $8,085,665 or Birch may be obligated to pay Cbeyond a termination fee of $16,166,830.

Q. Should I send in my Cbeyond stock certificates or other evidence of ownership now?

A. No. After the Merger is completed, the paying agent to be engaged by Birch in connection with the Merger will send to each of Cbeyond’s stockholders written, detailed instructions for exchanging your stock certificates for the Per Share Merger Consideration. You must return your stock certificates as described in the instructions. If your shares are held in “street name” by your broker, bank or other nominee, you may receive instructions from the broker, bank or other nominee as to what action, if any, you need to take to effect the exchange of your “street name” shares for the Per Share Merger Consideration. Please do not send in any certificates now.

Q. Will I be entitled to receive dividends for any period prior to the effective time of the Merger?

A. While you are still entitled to receive dividends for periods prior to the effective time of the Merger, Cbeyond has never paid or declared any dividends on its common stock and does not anticipate paying any dividends. In addition, Cbeyond has agreed not to pay or declare any dividends prior to the effective time of the Merger, without Birch’s consent.

Q. What happens to my vote if I sell my shares before the annual meeting?

A. The record date for stockholders entitled to vote at the annual meeting is earlier than both the date of the annual meeting and the consummation of the Merger. If you transfer your shares after the record date but before the annual meeting, unless special arrangements (such as provision of a proxy) are made between you and the person to whom you transfer your shares and each of you notifies Cbeyond in writing of such special arrangements, you will retain your right to vote such shares at the annual meeting but will transfer the right to receive the Per Share Merger Consideration to the person to whom you transfer your shares.

Q. What should I do if I have questions?

A. If you have more questions about the annual meeting, the Merger or this proxy statement, or would like additional copies of this proxy statement, you should contact MacKenzie Partners, Inc., Cbeyond’s proxy solicitor, at (800) 322-2885.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement and the documents which Cbeyond incorporates by reference into this proxy statement, as well as the other documents Cbeyond files with the SEC, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Section Exchange Act of 1934, as amended, that are based on current expectations, estimates, forecasts and projections about Cbeyond’s future performance, business and beliefs, and management’s assumptions. These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made, and Cbeyond undertakes no obligation to update any of them publicly in light of new information or future events. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: (1) Cbeyond may be unable to obtain stockholder approval as required for the Merger; (2) conditions to the closing of the Merger may not be satisfied and required regulatory approvals may not be obtained; (3) the Merger may involve unexpected costs, liabilities or delays; (4) the business of Cbeyond may suffer as a result of uncertainty surrounding the Merger; (5) the outcome of any legal proceedings related to the Merger; (6) Cbeyond may be adversely affected by other economic, business, and/or competitive factors; (7) the occurrence of any event, change or other circumstances that could give rise to the termination of the Agreement; (8) risks that the Merger disrupts current plans and operations and the potential difficulties in employee retention as a result of the Merger; and (9) other risks to consummation of the Merger, including the risk that the Merger may not be consummated within the expected time period or at all. If the Merger is consummated, Cbeyond stockholders will cease to have any equity interest in Cbeyond and will have no right to participate in its earnings and future growth. Additional factors that may affect the future results of Cbeyond are set forth in its filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2013 and its quarterly report for the three months ended March 31, 2014, which are available on the SEC’s website at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof.

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THE ANNUAL MEETING

Date, Time, Place and Purpose of the Annual Meeting

This proxy statement is being furnished to Cbeyond’s stockholders in connection with the solicitation of proxies by Cbeyond’s Board of Directors for use at the annual meeting to be held at Hyatt House, 3595 Cumberland Boulevard Southeast, Atlanta, Georgia 30339 on Wednesday, July 9, 2014 beginning at 9:30 a.m., local time, or at any adjournment or postponement thereof. At the annual meeting, holders of Cbeyond common stock present in person or represented by proxy and entitled to vote will be asked:

A copy of the Merger Agreement is included as Annex A to this proxy statement. This proxy statement and the enclosed form of proxy are first being mailed to stockholders on or about June  5, 2014.

Recommendation of Cbeyond’s Board of Directors

After careful consideration, Cbeyond’s Board of Directors determined that that the Merger and the transactions contemplated by the Merger Agreement are advisable, substantively and procedurally fair to, and in the best interests of, Cbeyond and its stockholders and has unanimously authorized, accepted, approved and adopted the Merger Agreement and the transactions contemplated therein, including the Merger.

Accordingly, Cbeyond’s Board of Directors recommends that you vote:

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In addition, the Board of Directors, based on recommendations from its Audit, Corporate Governance and Nominating, and Compensation Committees, recommends that you vote:

Record Date

Holders of record of Cbeyond common stock at the close of business on June 2, 2014, the record date, are entitled to notice of, and to vote at, the annual meeting or any adjournment or postponement thereof. As of the close of business on June 2, 2014, there were 32,444,174 shares of Cbeyond common stock outstanding and entitled to vote at the annual meeting, held by approximately 48 holders of record.

Required Vote and Quorum

The affirmative vote by holders of at least a majority of the outstanding shares of Cbeyond’s common stock is required for the adoption of the Merger Agreement (Proposal No. 1). Abstentions or the failure to vote your shares will have the same effect as a vote against the Merger.

Proposal Nos. 2, 3, 5 and 6 require the affirmative vote of at least a majority of the shares of Cbeyond’s common stock, present in person or represented by proxy and entitled to vote at the annual meeting.

Nominees for election to the Cbeyond Board of Directors (Proposal No. 4) shall be elected by a plurality of the votes cast by holders of Cbeyond’s common stock present in person or by proxy at the Annual Meeting.

The presence of the holders of a majority of the voting power of the outstanding shares of Cbeyond entitled to vote generally in the election of directors represented in person or by proxy, shall constitute a quorum at a meeting of stockholders, except that when specified business is to be voted on by a class or series voting separately as a class or series, the holders of a majority of the voting power of the shares of such class or series shall constitute a quorum for the transaction of such business.

Voting

Attendance

All holders of shares of Cbeyond common stock as of the close of business on the record date, including stockholders of record and beneficial owners of common stock registered in the “street name” of a bank, broker or other nominee, are invited to attend the annual meeting. For directions to the annual meeting, please call Cbeyond’s Investor Relations at (678)  486-8023.

Voting in Person

The Cbeyond stockholders of record as of the record date will be able to vote in person at the annual meeting. If you are not a stockholder of record, but instead hold your shares in “street name” through a bank, broker or other nominee, you must provide a proxy executed in your favor from your bank, broker or other nominee in order to be able to vote in person at the annual meeting.

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Providing Voting Instructions by Proxy

To ensure that your shares are represented at the annual meeting, Cbeyond recommends that you provide voting instructions promptly by proxy, even if you plan to attend the annual meeting in person.

If you are a Cbeyond stockholder of record as of the record date, you may provide voting instructions by proxy by completing, signing, dating and returning the enclosed proxy card. You may alternatively follow the instructions on the enclosed proxy card for Internet proxy submissions. Proxy cards submitted by mail must be received before July 8, 2014 to be voted at the annual meeting. If you submit your proxy through the Internet, it must be received by 11:59 p.m., Eastern time, July 8, 2014.

If you sign, date and return your proxy without indicating how you wish to vote, your proxy will be voted “ FOR ” each of the proposals being presented at the annual meeting. If you fail to return your proxy, the effect will be that your shares will not be counted for purposes of determining whether a quorum is present at the annual meeting (unless you are a record holder as of the record date and attend the annual meeting in person) and will have the same effect as a vote “ AGAINST ” of Proposal No. 1.

For each of Proposal Nos. 1, 2, 3, 5 and 6 you may vote “ FOR ,” “ AGAINST ” or “ ABSTAIN .” And for Proposal 4, you may vote “ FOR ” one or more specified nominees or you may “ WITHHOLD ” your vote for all nominees.

If your shares are held by a bank, broker or other nominee on your behalf in “street name,” your bank, broker or other nominee will send you instructions as to how to provide voting instructions for your shares by proxy. Many banks and brokerage firms have a process for their customers to provide voting instructions by telephone or via the Internet, in addition to providing voting instructions by proxy card.

In accordance with the rules of NASDAQ, banks, brokers and other nominees who hold shares of common stock in “street name” for their customers do not have discretionary authority to vote the shares with respect to the approval of Proposal Nos. 1, 2, 3, 4 or 6. Accordingly, if banks, brokers or other nominees do not receive specific voting instructions from the beneficial owner of such shares they may not vote such shares with respect to the approval of the Merger Agreement and a “broker non-vote” will arise. Broker non-votes, if any, will be counted for purposes of determining whether a quorum is present at the annual meeting. For shares of Cbeyond common stock held in “street name,” only such shares affirmatively voted “ FOR ” Proposal No. 1 will be counted as favorable votes for such proposal. Broker non-votes on Proposal No. 1 will have the same effect as votes “ AGAINST ” Proposal No. 1. Broker non-votes will not have any effect on Proposal Nos. 2, 3, 4 and 6. Brokers may vote in their discretion on Proposal No. 5.

Abstentions will be included in the calculation of the number of shares of Cbeyond common stock represented at the annual meeting for purposes of determining whether a quorum has been achieved. Abstaining from voting will have the same effect as a vote “ AGAINST ” each of Proposal Nos. 1, 2, 3, 5 and 6.

A “ WITHHOLD ” vote on Proposal No. 4 will be included in the calculation of the number of shares of common stock represented at the annual meeting for purposes of determining whether a quorum has been achieved, but will have no effect on the election of directors.

Revocation of Proxies

Your proxy is revocable. If you are a holder of record of Cbeyond common stock as of the record date, you may revoke your proxy at any time before the vote is taken at the annual meeting by:

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Attending the annual meeting in person without taking one of the actions described above will not in itself revoke a previously submitted proxy. Please note that if you want to revoke your proxy by mailing a new proxy card to Cbeyond or by sending a written notice of revocation to Cbeyond, you should ensure that you send your new proxy card or written notice of revocation in sufficient time for it to be received by Cbeyond before the day of the annual meeting.

If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee in order to revoke your proxy or submit new voting instructions.

Postponements and Adjournments

Although it is not currently expected, the annual meeting may be postponed or adjourned. A postponement or adjournment may occur, with the consent of Birch (such consent not to be unreasonably withheld or delayed), whether prior to or after conducting those portions of the meeting pertaining to the election of directors and ratification of auditors under any of the methods described below:

No postponement, recess or adjournment shall exceed thirty days in the aggregate.

Appraisal Rights

Holders of shares of Cbeyond common stock who do not vote in favor of the proposal to adopt the Merger Agreement and who properly perfect appraisal of their shares will be entitled to appraisal rights in connection with the Merger under Section 262 of the DGCL.

The following discussion is not a complete statement of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262 of the DGCL which is attached to this proxy statement as Annex C. The following summary does not constitute any legal or other advice nor does it constitute a recommendation that stockholders exercise their appraisal rights under Section 262 of the DGCL.

Under the DGCL, record holders of Cbeyond common stock who do not wish to accept the Per Share Merger Consideration have the right to seek appraisal of their shares of Cbeyond common stock and to receive payment for the fair value of their shares of Cbeyond common stock, exclusive of any element of value arising from the accomplishment or expectation of the Merger, as determined by the Delaware Court of Chancery, together with interest, if any, to be paid upon the amount determined to be fair value. The “fair value” of shares of Cbeyond common stock as determined by the Delaware Court of Chancery may be more than, less than, or

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equal to the Per Share Merger Consideration that holders are otherwise entitled to receive under the terms of the Merger Agreement. These rights are known as appraisal rights. Cbeyond stockholders who do not vote in favor of the proposal to adopt the Merger Agreement, who properly demand appraisal for their shares of Cbeyond common stock in compliance with the provisions of Section 262 of the DGCL, which is referred to in this proxy statement as Section 262, and who hold of record shares of Cbeyond common stock continuously through the effective time of the Merger and do not otherwise withdraw or lose the right to appraisal under Delaware law will be entitled to appraisal rights. Strict compliance with the statutory procedures in Section 262 is required. Failure to follow precisely any of the statutory requirements will result in the loss of appraisal rights.

Under Section 262, when a merger agreement is to be submitted for adoption at a meeting of stockholders, the company submitting the matter to a vote of stockholders must notify the stockholders, who were stockholders on the record date for notice of the meeting with respect to shares for which appraisal rights are available, that appraisal rights will be available not less than twenty days before the meeting to vote on the transaction. A copy of Section 262 must be included with such notice. This proxy statement constitutes Cbeyond’s notice to its stockholders that appraisal rights are available in connection with the Merger and the full text of Section 262 is attached to this proxy statement as Annex C, in compliance with the requirements of Section 262. Holders of shares of Cbeyond common stock who wish to consider exercising appraisal rights should carefully review the text of Section 262 contained in Annex C. Failure to comply timely and properly with the requirements of Section 262 will result in the loss of appraisal rights under the DGCL. Moreover, because of the complexity of the procedures for exercising the right to seek appraisal of shares of Cbeyond common stock, Cbeyond believes that a stockholder who is considering exercising such rights should seek the advice of legal counsel.

Holders of shares of Cbeyond common stock who wish to demand appraisal of their shares must deliver to Cbeyond a written demand for appraisal of the holder’s shares of Cbeyond common stock before the vote is taken to approve the proposal to adopt the Merger Agreement. The demand must reasonably inform Cbeyond of the identity of the holder of record of shares of Cbeyond common stock who intends to demand appraisal of his, her or its shares of Cbeyond common stock and that such holder intends to demand the appraisal of his, her or its shares. A stockholder seeking appraisal of his or her shares may not vote in favor of the proposal to adopt the Merger Agreement. In addition, a holder of shares of Cbeyond common stock wishing to exercise appraisal rights must hold of record the shares of Cbeyond common stock on the date the written demand for appraisal is made and must continue to hold such shares of Cbeyond common stock of record through the effective time of the Merger.

A proxy that is submitted and does not contain voting instructions will, unless revoked, be voted in favor of the proposal to adopt the Merger Agreement, and it will constitute a waiver of the stockholder’s right of appraisal and will nullify any previously delivered written demand for appraisal. Therefore, a stockholder who submits a proxy and who wishes to exercise appraisal rights must either submit a proxy containing instructions to vote against the proposal to adopt the Merger Agreement or abstain from voting on the proposal to adopt the Merger Agreement. Voting against or failing to vote for the proposal to adopt the Merger Agreement by itself does not constitute a demand for appraisal within the meaning of Section 262. The written demand for appraisal must be in addition to and separate from any proxy or vote on the proposal to adopt the Merger Agreement.

All demands for appraisal should be addressed to Cbeyond’s General Counsel, William Weber, and must be delivered before the vote is taken to approve the proposal to adopt the Merger Agreement at the Cbeyond annual meeting. The demand must reasonably inform Cbeyond of the identity of the stockholder and the intention of the stockholder to demand appraisal of the “fair value” of his, her or its shares of Cbeyond common stock. A stockholder’s failure to deliver the written demand to Cbeyond prior to the taking of the vote on the adoption of the Merger Agreement at the annual meeting of Cbeyond stockholders will constitute a waiver of appraisal rights.

Only a holder of record of shares of Cbeyond common stock is entitled to demand an appraisal of the shares registered in that holder’s name. Accordingly, to be effective, a demand for appraisal by a stockholder of

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Cbeyond common stock must be made by, or in the name of, the record stockholder. The demand must set forth fully and correctly the record stockholder’s name as it appears on the stockholder’s stock certificate(s) or in the transfer agent’s records, in the case of uncertificated shares, should specify the stockholder’s mailing address and the number of shares registered in the stockholder’s name, and must state that the person intends thereby to demand appraisal of the stockholder’s shares in connection with the Merger. The demand cannot be made by the beneficial owner if he or she does not also hold the shares of Cbeyond common stock of record. The beneficial holder must, in such cases, have the registered owner, such as a broker, bank or other nominee, submit the required demand with respect to those shares of Cbeyond common stock. If a stockholder holds shares of Cbeyond common stock through a broker or bank who in turn holds the shares through a central securities depository nominee such as the Depository Trust & Clearing Corporation, a demand for appraisal of such shares must be made by or on behalf of the depository nominee and must identify the depository nominee as record holder. If you hold your shares of Cbeyond common stock through a broker, bank or other nominee and you wish to exercise appraisal rights, you should consult with your broker, bank or other nominee to determine the appropriate procedures for the making of a demand for appraisal by the nominee.

If shares of Cbeyond common stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, execution of a demand for appraisal must be made in that capacity. If the shares of Cbeyond common stock are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand must be executed by or for all joint owners. An authorized agent, including an authorized agent for two or more joint owners, may execute the demand for appraisal for a stockholder of record; however, the agent must identify the record owner or owners and expressly disclose the fact that, in executing the demand, he or she is acting as agent for the record owner. A record owner, such as a broker, bank or other nominee, who holds shares of Cbeyond common stock as a nominee for others, may exercise his or her right of appraisal with respect to the shares of Cbeyond common stock held for one or more beneficial owners, while not exercising this right for other beneficial owners. In that case, the written demand should state the number of shares of Cbeyond common stock as to which appraisal is sought. Where no number of shares of Cbeyond common stock is expressly mentioned, the demand will be presumed to cover all shares of Cbeyond common stock held in the name of the record owner.

Within ten days after the effective time of the Merger, the surviving corporation in the Merger must give written notice of the effective date of the Merger to each stockholder of Cbeyond who has complied with Section 262 and who did not vote in favor of the proposal to adopt the Merger Agreement. At any time within sixty days after the effective time of the Merger, any stockholder who has not commenced an appraisal proceeding or joined a proceeding as a named party may withdraw the demand and accept the consideration specified by the Merger Agreement for that stockholder’s shares of Cbeyond common stock by delivering to the surviving corporation a written withdrawal of the demand for appraisal. However, any such attempt to withdraw the demand made more than sixty days after the effective time of the Merger will require written approval of the surviving corporation.

Except with respect to a demand for appraisal that is properly withdrawn by the stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party within sixty days after the effective date of the Merger, no appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval of the Delaware Court of Chancery, with such approval conditioned upon such terms as the court deems just.

Within 120 days after the effective time of the Merger, but not thereafter, either the surviving corporation or any stockholder who has complied with the requirements of Section 262 and is entitled to appraisal rights under Section 262 may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares of Cbeyond common stock held by all such stockholders. Upon the filing of the petition by a stockholder, service of a copy of such petition shall be made upon the surviving corporation. The surviving corporation has no obligation to file such petition and has no present intention to file a petition and holders should not assume that the surviving corporation will file a

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petition. In the event that the surviving corporation does not file such petition, it is the obligation of the holders of Cbeyond common stock to initiate all necessary action to perfect their appraisal rights with respect to shares of Cbeyond common stock within the time prescribed in Section 262. The failure of a stockholder to file such a petition within the period specified in Section 262 could nullify the stockholder’s previous written demand for appraisal. In addition, within 120 days after the effective time of the Merger, any stockholder who has properly filed a written demand for appraisal and who did not vote in favor of the Merger Agreement, will be entitled to receive from the surviving corporation, upon written request, a statement setting forth the aggregate number of shares of Cbeyond common stock not voted in favor of the Merger Agreement and with respect to which demands for appraisal have been received and the aggregate number of holders of such shares. The statement must be mailed within ten days after such written request has been received by the surviving corporation or within ten days after the expiration of the period for delivery of demands for appraisal, whichever is later. A person who is the beneficial owner of shares of Cbeyond common stock held either in a voting trust or by a nominee on behalf of such person may, in such person’s own name, file a petition for appraisal or request from the surviving corporation such statement.

If a petition for appraisal is filed by a stockholder, service of a copy of the petition must be delivered to the surviving corporation. The surviving corporation will then be obligated, within twenty days after receiving service of a copy of the petition, to file with the Delaware Register in Chancery a duly verified list containing the names and addresses of all stockholders who have demanded payment for their shares of Cbeyond common stock and with whom agreements as to the value of their shares of Cbeyond common stock have not been reached. After notice to stockholders who have demanded appraisal, if such notice is ordered by the Delaware Court of Chancery, the Delaware Court of Chancery will conduct a hearing upon the petition and to determine those stockholders who have complied with Section 262 and who have become entitled to the appraisal rights provided by Section 262. The Delaware Court of Chancery may require stockholders who have demanded an appraisal for their shares of Cbeyond common stock, and who hold shares represented by certificates, to submit their stock certificates to the Register in Chancery for notation thereon of the pendency of the appraisal proceedings; and if any stockholder fails to comply with that direction, the Delaware Court of Chancery may dismiss the proceedings as to that stockholder.

After determination of the stockholders entitled to appraisal of their shares of Cbeyond common stock, the Delaware Court of Chancery will appraise the shares of Cbeyond common stock, determining their fair value by taking into account all relevant factors exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any, to be paid upon the amount determined to be the fair value. When the fair value has been determined, the Delaware Court of Chancery will direct the payment of such value upon surrender by those stockholders of the certificates representing their shares of Cbeyond common stock (in the case of holders of uncertificated shares, the payment will be made forthwith). Unless the Court in its discretion determines otherwise for good cause shown, interest from the effective date of the Merger through the date of payment of the judgment will be compounded quarterly and will accrue at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during the period between the effective time of the Merger and the date of payment of the judgment.

Neither Cbeyond nor Birch anticipates offering more than the Per Share Merger Consideration to any stockholder exercising appraisal rights and they reserve the right to assert, in any appraisal proceeding, that, for purposes of Section 262, the “fair value” of a share of Cbeyond common stock is less than the Per Share Merger Consideration. In determining “fair value,” the court is required to take into account all relevant factors. In Weinberger v. UOP, Inc. , 457 A.2d 701 (Del. 1983), the Delaware Supreme Court discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that “proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court” should be considered and that “[f]air price obviously requires consideration of all relevant factors involving the value of a company.” The Delaware Supreme Court has stated that in making this determination of fair value, the court must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise and any other facts that could be ascertained as of the date of the merger that throw any

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light on future prospects of the merged corporation. Section 262 provides that fair value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc. , 684 A.2d 284 (Del. 1996), the Delaware Supreme Court stated that such exclusion is a “narrow exclusion [that] does not encompass known elements of value,” but which rather applies only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger , the Delaware Supreme Court also stated that “elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.”

Costs of the appraisal proceeding may be determined by the Delaware Court of Chancery and imposed upon the surviving corporation and the stockholders participating in the appraisal proceeding by the Delaware Court of Chancery, as it deems equitable in the circumstances. Upon the application of a stockholder, the Delaware Court of Chancery may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts used in the appraisal proceeding, to be charged pro rata against the value of all shares of Cbeyond common stock entitled to appraisal. Any stockholder who demanded appraisal rights will not, after the effective time of the Merger, be entitled to vote shares of Cbeyond common stock subject to that demand for any purpose or to receive payments of dividends or any other distribution with respect to those shares of Cbeyond common stock, other than with respect to payment as of a record date prior to the effective time of the Merger. If no petition for appraisal is filed within 120 days after the effective time of the Merger or if a stockholder successfully withdraws such holder’s right to appraisal, then the right of that stockholder to appraisal will cease and that stockholder’s shares of Cbeyond common stock will be deemed to have been converted at the effective time of the Merger into the right to receive the Merger consideration pursuant to the Merger Agreement. In addition, in the circumstances described above, a stockholder may withdraw his, her or its demand for appraisal in accordance with Section 262 and accept the Merger consideration offered pursuant to the Merger Agreement.

Failure to comply strictly with all of the procedures set forth in Section 262 of the DGCL will result in the loss of a stockholder’s statutory appraisal rights. In view of the complexity of Section 262 of the DGCL, Cbeyond stockholders who may wish to pursue appraisal rights should consult their legal and financial advisors.

Solicitation of Proxies

All expenses for soliciting proxies will be paid by Cbeyond, which has retained MacKenzie Partners, Inc. to aid in the solicitation of proxies, for fees of approximately $40,000, plus reasonable out-of-pocket expenses. Proxies may be solicited by personal interview, mail and telephone. MacKenzie Partners, Inc. has contacted brokerage houses, other custodians and nominees to ask whether other persons are the beneficial owners of the shares they hold in street name and, if that is the case, will supply additional copies of the proxy materials for distribution to such beneficial owners. Cbeyond will reimburse such parties for their reasonable expenses for sending proxy materials to the beneficial owners of the shares. In addition, solicitation of proxies may be supplemented by telephone, facsimile, electronic mail or personal solicitation by Cbeyond’s directors, officers or employees. No additional compensation will be paid to directors, officers or employees for such services. Cbeyond may commence solicitation of proxies on or after June 6, 2014 and will continue to solicit proxies until the annual meeting. Only the Cbeyond Stockholders of record as of the record date are entitled to vote at the annual meeting.

Additional Assistance

If you have more questions about the Merger, or require assistance in submitting your proxy or voting your shares or need additional copies of the proxy statement or the enclosed proxy card, please contact MacKenzie Partners, Inc. at (800) 322-2885, which is acting as Cbeyond’s proxy solicitation agent and information agent in connection with the Merger.

If your broker, bank or other nominee holds your shares, you should also call your broker, bank or other nominee for additional information.

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Other Business

Cbeyond’s Board of Directors does not expect to bring any other matter before the annual meeting and is not aware of any other matter that may be considered at the meeting. However, if any other matter does properly come before the meeting, the proxy holders will vote the proxies in accordance with the recommendations of Cbeyond’s Board of Directors.

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THE MERGER

This discussion of the Merger is qualified by reference to the Merger Agreement, which is attached to this proxy statement as Annex A. You should read the entire Merger Agreement carefully as it is the legal document that governs the Merger.

Background of the Merger

Cbeyond first launched service offerings focused primarily at small and medium-sized businesses (“SMBs”) in Atlanta in April 2001 and expanded its on-net network and service offerings into 13 additional metropolitan markets. Cbeyond’s initial offerings consisted primarily of bundled voice and data services delivered over T1 lines, and its strategy focused on deploying an asset-light but efficient network.

Following the recession of 2008 and the entry into Cbeyond’s markets of price-based competition from cable service providers and other competitive telecom providers, Cbeyond began experiencing pressure on its average revenue per customer, its customer retention rates and its operating margins. In response to the changing competitive landscape, Cbeyond began expanding its service capabilities to include IT service applications and certain cloud-based services, such as virtual servers, physical servers and cloud PBX services. As part of this product expansion, Cbeyond completed the acquisition of two small cloud infrastructure companies in 2010. Cbeyond also began to invest in Metro Ethernet capabilities in order to reduce operating costs and offer higher bandwidth to its customers. During 2011 Cbeyond identified an opportunity to shift its marketing focus more toward small and mid-sized businesses that are dependent on technology and have complex IT needs. Cbeyond defined certain of these technology-dependent customers as “Cbeyond 2.0” customers and focused on selling the newer, higher value-added bandwidth, cloud and IT services to this customer set, as well as to multi-location accounts, which use Cbeyond’s multiprotocol label switching service.

In early 2012, Cbeyond announced a new strategic initiative centered around accelerating the growth of its Cbeyond 2.0 customer base. This was primarily focused on a realignment of Cbeyond’s sales strategy and organization, including the creation of a new direct sales group dedicated to managing both existing and new technology-dependent customers, a reduction in its legacy direct sales force, and the addition of a dedicated inside sales team focused on cloud services. During this time, Cbeyond also improved its service offering portfolio by expanding its higher bandwidth offerings to customers. This was accomplished through targeted investment in both Cbeyond’s owned and partner-provided Ethernet-over-copper and fiber circuits.

Cbeyond’s operating and financial results in 2012 and 2013 demonstrated meaningful progress in evolving its revenue mix towards Cbeyond 2.0-based revenue. However, Cbeyond was not able to transition its sales force to selling Cbeyond 2.0 services at a pace quick enough to generate the Cbeyond 2.0 sales volumes that it had sought. Although sales productivity was improving gradually throughout 2013, the amount of new revenue being generated remained below management’s expectations. In addition, Cbeyond experienced increasing price pressure in the market on its legacy voice and data services, resulting in a higher customer churn rate for its legacy customer base.

Despite the progress made by Cbeyond on its Cbeyond 2.0 transformation strategy, the market price of Cbeyond’s common stock decreased throughout 2013. Management and the Board were therefore not satisfied that stockholder value was being created.

As part of its ongoing evaluation of Cbeyond’s business, Cbeyond’s senior management and Board periodically review, consider and assess Cbeyond’s operations, financial performance and industry conditions as they may affect Cbeyond’s long-term strategic goals and plans, including the consideration of potential opportunities for business combinations, acquisitions and other financial and strategic alternatives.

Against this background, the Board set as a specific agenda item for its October 23, 2013 meeting a discussion of whether Cbeyond should conduct a thorough review of its strategic alternatives at that time. In connection with that topic, management invited an investment bank (“Investment Bank A”) to present a

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preliminary review of potential strategic alternatives that the Board might consider based on discussions between Investment Bank A and management. The presentation included specific companies that might be suitable partners, acquirers or acquisitions for Cbeyond.

The Board meeting was attended in person by all members of the Board, representatives of Investment Bank A and a representative of Cbeyond’s long-standing outside legal counsel, Latham & Watkins LLP (“Latham & Watkins”). Investment Bank A’s presentation noted that Cbeyond’s 2.0 goals remained an attractive means for transforming Cbeyond but that progress towards those goals had been slower than anticipated. Investment Bank A advised the Board with respect to a broad range of strategic alternatives, including: (1) capital markets transactions, such as stock buybacks, which Investment Bank A advised are beneficial for mature companies with a high level of cash flow, but given the then-current circumstances of Cbeyond would be a challenging way to increasing stockholder value; (2) accelerating Cbeyond’s transition to 2.0 through small acquisitions, including specific potential acquisitions listed by Investment Bank A; and (3) a sale of Cbeyond. Investment Bank A advised that Cbeyond could potentially be attractive to a number of other companies involved in the telecommunications industry (“Strategic Acquirers”), which it listed, but would likely only be attractive to financial sponsors such as private equity firms (“Financial Sponsors”) that already held complementary portfolio companies where operating synergies would be possible. Investment Bank A provided a variety of metrics to value Cbeyond in a change of control transaction, including based on premiums paid, Cbeyond’s operating metrics and the prices at which comparable publicly held companies were trading.

Following Investment Bank A’s presentation and questions from the members of the Board, Investment Bank A left the meeting. Latham & Watkins reviewed the Board’s fiduciary duties, including potential conflicts of interest, in connection with a possible review of strategic alternatives. Each director gave his or her views as to whether it would be appropriate to conduct a review of strategic alternatives at that time. Following such discussion, the Board unanimously determined that Cbeyond should commence a review of strategic alternatives.

The Board also determined to form a temporary committee (the “Strategy Committee”) to provide advice and assistance to management during the process of reviewing strategic alternatives. The Board’s decision to form the Strategy Committee was based entirely on considerations of efficiency and the Board reserved, for the entire Board, the power to approve all decisions as to any specific strategic alternative or transaction. The Board appointed independent directors Jonathan Crane, David Rogan and Marvin Wheeler to serve on the Strategy Committee after determining that none of them had any conflicting relationship with any of the companies described on Investment Bank A’s list of potential transaction partners with Cbeyond. The Board also established that Strategy Committee meetings would be open to all members of the Board and invited James Geiger, Cbeyond’s founder, chairman and chief executive officer, and Robert Fugate, Cbeyond’s chief financial officer, and other members of senior management to attend meetings of the Strategy Committee as necessary to increase efficiency of communication and implementation of the process for reviewing strategic alternatives.

The Board determined that it would assist Cbeyond’s review of strategic alternatives for Cbeyond to engage a financial advisor. The Board discussed potential financial advisors with the directors focusing on the potential financial advisors’ experience in the telecommunications business and, to a lesser extent, familiarity with Cbeyond. Based on these criteria, the Board directed the Strategy Committee to interview four investment banks for a role as financial advisor to Cbeyond in connection with the review of strategic alternatives including Investment Bank A, UBS Securities LLC (“UBS”) and two other investment banks (collectively, the “Investment Bank Candidates”). The Board asked Latham & Watkins to contact the potential financial advisors to set up the interviews, emphasizing that the potential role was to assist with a true analysis of all strategic alternatives and that the use of the terminology “review of strategic alternatives” was not a code name for Cbeyond’s sale. The Board authorized management and the Strategy Committee to engage their choice for a financial advisor following the interviews on behalf of Cbeyond. Latham & Watkins contacted the four Investment Bank Candidates on October 23, 2013 and October 24, 2013.

The Board also asked Latham & Watkins to review Cbeyond’s corporate documents and the directors’ and officers’ indemnification agreements to evaluate whether modifications were necessary or appropriate.

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On November 1, 2013, the Strategy Committee, Messrs. Geiger and Fugate, and a representative of Latham & Watkins interviewed the Investment Bank Candidates at the offices of Latham & Watkins in New York City. Following the interviews, the participants discussed the merits of each of the Investment Bank Candidates based on their expertise in the telecommunications industry, knowledge of Cbeyond and presentations at the meeting. The Strategy Committee and Messrs. Geiger and Fugate unanimously determined that Latham & Watkins should speak with Investment Bank A and UBS to determine whether a satisfactory engagement letter could be negotiated.

On November 3, 2013, the Board held a telephonic meeting to discuss the Strategy Committee’s activities to date, which was attended by all directors, Mr. Fugate and Latham & Watkins. At that meeting the Board delegated to the Strategy Committee of authority to choose between Investment Bank A and UBS and engage the selected investment bank on behalf of the Board. Management noted that Cbeyond was scheduled to issue a press release reporting financial results for the quarter ended September 30, 2013 on November 6, 2014 and raised the question of whether the Board’s decision to conduct a review of strategic alternatives and the formation of the Strategy Committee should be announced. The Board unanimously determined to announce the review of strategic alternatives and the formation of the Strategy Committee in the press release but not to announce the engagement of a financial advisor pending discussion with the financial advisor hired as to the best timing for announcement.

On November 5, 2013, Messrs. Geiger, Fugate and Crane, along with Robert Clancy, Cbeyond’s Senior Vice-President, Finance met with representatives of UBS to further discuss the potential engagement and Cbeyond’s business. On November 5, 2013, the closing price of Cbeyond’s common stock on NASDAQ was $6.36.

On the morning of November 6, 2013, Cbeyond issued a press release, which included the following statement:

Cbeyond’s Board of Directors has formed a Strategy Committee to explore ways to accelerate Cbeyond 2.0 growth and explore strategic alternatives to enhance stockholder value more quickly than by pursuing the Company’s organic growth and transformation. The alternatives reviewed will include acquisitions designed to accelerate our 2.0 transformation and visibility of our cloud services, joint venture and other financing and strategic arrangements, and a business combination or sale of the Company. The review may take an extended period and there is no assurance that any action or transaction will arise from the review. The Company will remain focused on its transition to Cbeyond 2.0. Cbeyond will not comment further or provide updates on the review except as it deems appropriate.

On November 11, 2013, the Strategy Committee held a telephonic meeting that was also attended by Messrs. Geiger and Fugate and a representative of Latham & Watkins. At that meeting, Messrs. Geiger and Fugate and the representative of Latham & Watkins described the status of proposed terms for engagement as financial advisor with each of Investment Bank A and UBS. Messrs. Geiger and Fugate noted their personal opinion that both Investment Bank A and UBS had the expertise and experience to serve as Cbeyond’s financial advisor but that UBS’ terms, particularly non-financial terms such as those relating to conflicts, were superior. Following a discussion, the Strategy Committee unanimously approved the engagement of UBS on the terms described at the meeting. Cbeyond executed the engagement letter with UBS on November 11, 2013. Under the terms of the engagement letter, Cbeyond agreed to pay UBS for its financial advisory services in connection with the Merger a fee based, in part, on the aggregate value of any sale or acquisition transaction. In addition, Cbeyond agreed to reimburse UBS for its reasonable expenses, including fees, disbursements and other charges of counsel, and to indemnify UBS and related parties against liabilities, including liabilities under federal securities laws, relating to, or arising out of, its engagement.

On November 18, 2013, the Strategy Committee held a telephonic meeting that also was attended by directors Martin Mucci and Bonnie Wurzbacher, Mr. Fugate, representatives of UBS and a representative of

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Latham & Watkins. At the meeting, UBS reviewed with the directors an overview of: (1) the process for reviewing strategic alternatives; (2) potential purchasers of Cbeyond; and (3) potential acquisition targets. The Strategy Committee directed Latham & Watkins to discuss with UBS any potential conflicts of interest between UBS and any of the companies identified by UBS for potential involvement in a strategic transaction with Cbeyond. Latham & Watkins did so and determined that conflicts were not a concern.

On November 21, 2013, UBS met with Cbeyond’s senior executives at Cbeyond’s headquarters in order to improve UBS’ understanding of Cbeyond’s current business plan and discuss potential strategic partners.

On November 25, 2013, the Strategy Committee held a telephonic meeting that was also attended by Messrs. Geiger and Fugate, representatives of UBS and a representative of Latham & Watkins. UBS discussed with the attendees its meeting with senior executives of Cbeyond and potential Strategic Acquirers, as well as potential acquisition targets.

On December 3, 2013, the Strategy Committee held a telephonic meeting that was also attended by Messrs. Geiger and Fugate, representatives of UBS and a representative of Latham & Watkins. UBS described a potential timeline for calls to four potential Strategic Acquirers in December 2013 prior to a broader approach to potential acquirers after the year-end holidays and reviewed a preliminary analysis of certain potential strategic alternatives available to Cbeyond. The Strategy Committee authorized UBS to proceed with such outreach.

During December 2013, at the Board’s direction, UBS contacted three potential Strategic Acquirers and five potential acquisition targets to assess their level of interest in pursuing discussions with Cbeyond. One Strategic Acquirer indicated it was not interested in pursuing discussions because Cbeyond was not a strategic priority and two others expressed interest. One potential acquisition target (“Company A”) also expressed interest in discussing a transaction but indicated it would only be interested in a transaction that implied a multiple of Cbeyond’s common stock that was higher than the multiple at which Cbeyond’s common stock was then trading and, for that reason, it would prefer a cash transaction.

On December 16, 2013, the Strategy Committee held a telephonic meeting that was also attended by Messrs. Geiger and Fugate, representatives of UBS and a representative of Latham & Watkins. UBS discussed with the directors its discussions to date with both potential strategic acquirers and acquisition targets. With respect to its discussions with potential acquisition targets, UBS discussed with the directors that acquisition targets focused on a cloud-based business model underscored the challenges of acquiring businesses trading at significant multiples and that, at the type of valuation required to incentivize the owners of such companies to sell outside an auction process, Cbeyond would likely need to give up a meaningful ownership stake in the form of stock-based payment for the acquisition.

On January 6, 2014, the Strategy Committee held a meeting that was attended by Messrs. Wheeler and Rogan; Messrs. Geiger, Fugate, and Clancy; directors Mr. Costello and Ms. Wurzbacher; representatives of UBS and a representative of Latham & Watkins. At the meeting, UBS reviewed with the Board its December 2013 contacts with the eight parties and informed the Strategy Committee that two potential Strategic Acquirers had begun limited due diligence. UBS also discussed with the Board an expected timeline for the first quarter of 2014, including the launch of a formal process to approach potential strategic transaction partners. UBS noted that it had reviewed an information packet for potential Strategic Acquirers prepared by management. UBS also presented, for the Strategy Committee’s review, the components of a letter UBS expected to provide to parties as part of the strategic alternatives process. Following discussion, the Strategy Committee unanimously authorized management and UBS to proceed as outlined at the meeting.

At this meeting, the Strategy Committee discussed the question of whether to contact Financial Sponsors as well as potential Strategic Acquirers and discussed with Cbeyond’s advisors that the economics of Cbeyond’s 2.0 strategy were unlikely to lend themselves to a highly leveraged transaction without the economies of scale and synergies that could exist for a Strategic Acquirer, including, in some cases, Strategic Acquirers backed by a

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Financial Sponsor. UBS also discussed with the Board that Cbeyond had publicly announced its review of strategic alternatives so any Financial Sponsor that was interested in considering an acquisition or other transaction with Cbeyond would be on notice to contact Cbeyond. For these reasons, following a discussion, the Strategy Committee, after considering, among other things, information, advice and recommendations received from its financial and other advisors, determined not to contact Financial Sponsors but that Cbeyond be open to in-bound calls from Financial Sponsors. The Strategy Committee then directed UBS to focus outbound inquiries on Strategic Acquirers in connection with a potential sale of Cbeyond and potential acquisition targets for Cbeyond.

Commencing January 8, 2014, at the Strategy Committee’s direction, UBS contacted a total of 58 companies, including 50 Strategic Acquirers and 8 potential acquisition targets. UBS also received unsolicited inquiries from 14 parties, including 8 Financial Sponsors and Birch Communications, Inc. (“Birch”). Ultimately, twenty parties executed confidentiality and standstill agreements, which included don’t ask, don’t waive standstill provisions (“Non-Disclosure Agreements”), with Cbeyond and received an information package prepared by management of Cbeyond and reviewed by UBS.

On January 13, 2014, the Strategy Committee held a meeting attended by Messrs. Wheeler and Rogan; Mr. Mucci; Messrs. Geiger, Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. At the meeting, UBS reported that Company A also planned to engage in a review of strategic alternatives and planned to include a potential acquisition by Cbeyond in that review. UBS indicated that, as of that time, two companies had already executed Non-Disclosure Agreements, 10 companies had expressed interest and were negotiating Non-Disclosure Agreements and 6 companies had declined to participate in the process for various reasons, including lack of strategic fit and the geographic scope of Cbeyond’s business. In addition, UBS listed the 8 Financial Sponsors that had contacted UBS or Cbeyond to express interest in light of the press release that disclosed Cbeyond’s review of strategic alternatives.

On January 16, 2014, at the direction of the Strategy Committee, UBS sent a letter to each of the remaining Strategic Acquirers and Financial Sponsors in the strategic alternatives process requesting the submission of indications of interest by February 3, 2014 from participants who wished to continue discussing a potential acquisition of Cbeyond. Proposals were to include a proposed price, the form of consideration proposed, financing required and further due diligence requirements. The letter noted that Cbeyond’s management would be available to make presentations to interested participants during the intervening period prior to February 3, 2014.

On January 20, 2014, the Strategy Committee held a meeting attended by all members; Mr. Mucci; Messrs. Geiger and Clancy; representatives of UBS and a representative of Latham & Watkins. With respect to the potential acquisition of Company A, UBS reported that it expected to receive preliminary due diligence materials from Company A’s financial advisor later that day and that Cbeyond should expect to review those materials and come to a preliminary assessment of Company A’s value and Cbeyond’s ability to finance that acquisition within approximately two weeks. UBS also reported that it had been in touch with 44 potential Strategic Acquirers, including four potential Strategic Acquirers that had approached UBS or Cbeyond in response to Cbeyond’s press release indicating that Cbeyond was exploring strategic alternatives and seven Financial Sponsors. UBS reported that 13 parties had executed Non-Disclosure Agreements and received information packages, seven parties were negotiating Non-Disclosure Agreements and 18 parties had declined to participate in the process for reasons including a lack of strategic fit, the geographic scope of Cbeyond’s business, Cbeyond’s focus on SMBs and the inability to do an acquisition at that time. UBS noted that, pursuant to earlier discussions with the Strategy Committee, the process letters called for potential acquirers to provide a preliminary indication of interest by February 3, 2014 for review at Cbeyond’s Board meeting on February 5, 2014.

On January 27, 2014, the Strategy Committee held a meeting attended by Mr. Crane; Ms. Wurzbacher; Messrs. Geiger, Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. UBS reported that it had now been in contact with 46 potential Strategic Acquirers and eight Financial Sponsors, that a

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total of 18 information packages and process letters had been sent, four Non-Disclosure Agreements were being negotiated and a total of 20 parties had declined to participate in the process. UBS reported that, with respect to the potential acquisition of Company A, Cbeyond and UBS had received preliminary information and there was to be a call among Cbeyond management, Company A and their financial advisors scheduled for later that week. Management indicated that it and UBS intended to provide an overview of Company A’s business, initial valuation considerations and potential synergies at the Board’s meeting on February 5, 2014.

On February 3, 2014, Lazard Freres & Co, LLC (“Lazard”) contacted UBS to indicate that Lazard was Birch’s financial advisor and that Birch wished to be considered as a potential acquirer of Cbeyond and participate in Cbeyond’s process. Following this contact by Lazard, UBS discussed Birch’s interest with management, and management agreed to allow Birch to participate in the strategic alternatives process, but noted that Birch would need to move quickly given that others were well into their evaluation of Cbeyond. After further consultation with management and Latham & Watkins, UBS informed Lazard on February 4, 2014 that Birch could be included in Cbeyond’s process but that Birch was late entering the process and would need to move quickly.

On February 3, 2014, UBS received indications of interest from seven potential acquirers of Cbeyond.

On February 4, 2014, Birch executed a Non-Disclosure Agreement and UBS delivered Cbeyond’s information package to Lazard.

On February 5, 2014, the Board held a meeting attended by all directors, Messrs. Fugate and Clancy, representatives of UBS and a representative of Latham & Watkins. At the meeting, UBS discussed with the Board the status of Cbeyond’s consideration of the acquisition of Company A as well as the potential sale of Cbeyond.

With respect to a potential acquisition of Company A, UBS and management discussed with the Board preliminary views on Company A’s business, illustrative potential synergies arising from an acquisition of Company A, a preliminary view of value of Company A to Cbeyond, an illustrative transaction and the potential effect of such a transaction on Cbeyond’s stockholder value. As part of that report UBS and management noted that management had engaged in a due diligence call with Company A, had (in consultation with UBS) developed sensitivity analyses of Company A’s projections for future performance and preliminarily analyzed potential financial leverage that could be employed by Cbeyond in an acquisition of Company A.

With respect to the potential sale of Cbeyond, UBS reported that on February 3, 2014, seven parties, including one potential strategic acquirer that would ultimately submit a subsequent proposal and with which Cbeyond would continue negotiations (“Company B”), three other Strategic Acquirers (some of which were backed by Financial Sponsors) and three Financial Sponsors, had provided preliminary indications of interest in acquiring Cbeyond at enterprise values ranging from $230 to $275 million. UBS gave a summary analysis of each indication of interest. UBS also noted that Birch had expressed interest in participating in the process and had been advised that, while participation would be allowed, Birch was behind in its participation and would need to move quickly to be considered as a potential acquirer.

UBS recommended that Cbeyond provide additional due diligence and management presentations to interested parties over the succeeding several weeks and authorize Latham & Watkins to draft a form of acquisition agreement for interested parties to address in connection with more definitive bids, which were recommended to occur within the following three weeks.

Following discussion, the Board authorized management, UBS and Latham & Watkins to continue to explore both the acquisition of Company A and a potential sale of Cbeyond consistent with the general timeline outlined at the meeting.

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On February 10, 2014, the Strategy Committee held a meeting attended by Messrs. Crane and Wheeler; Messrs. Geiger, Fugate and Clancy; Messrs. Costello and Mucci and Ms. Wurzbacher; representatives of UBS and a representative of Latham & Watkins. The participants discussed the status of due diligence by participants in the sale process and Cbeyond’s review of the potential acquisition of Company A.

Following the Strategy Committee meeting on February 10, 2014, UBS received a written indication of interest from Birch to purchase Cbeyond at an enterprise value of between $290 and $320 million in cash, exceeding the range submitted by any of the previous bidders. The indication of interest stated that Birch would finance the transaction with third party debt and had engaged in preliminary discussions with financing institutions. Following consultation with management and Latham & Watkins, UBS informed Birch that it would be allowed to continue to participate in Cbeyond’s sale process.

From February 10, 2014 through March 30, 2014, the remaining Strategic Acquirers and Financial Sponsors involved in Cbeyond’s strategic alternatives process continued to perform due diligence, including participation in management presentations. In sum, management made presentations to 7 potential acquirers. Management presentations with Birch took place on February 25, 2014.

On February 20, 2014, UBS received an updated indication of interest from a Strategic Acquirer providing for a purchase of Cbeyond at an enterprise value of $255 million.

On February 26, 2014, the Strategy Committee held a meeting attended by all members; Messrs. Costello and Mucci; Ms. Wurzbacher; Messrs. Geiger, Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. With respect to the potential sale of Cbeyond, UBS reported on the status of each of the eight remaining participants’ due diligence activities. UBS noted that management presentations to these potential acquirers had been taking place and were scheduled to continue through March 3, 2014. UBS noted that, based on scheduling difficulties and the complexity of Cbeyond’s business, the process likely would require an extended due diligence period. Following a discussion, the Strategy Committee, after considering, among other things, information, advice and recommendations received from its financial and other advisors, requested that final bids by potential acquirers be targeted for near the end of March 2014. The Strategy Committee, after considering the recommendations of its financial and other advisors, among other things, determined that a form of merger agreement prepared by Latham & Watkins be made available for review by potential acquirers with a request for comments prior to final bids so that Cbeyond, UBS and Latham & Watkins could provide feedback on potential contractual issues prior to final bids.

With respect to Cbeyond’s potential acquisition of Company A, UBS noted that Company A had itself launched a formal sale process and that it would be unlikely that Cbeyond could pre-empt Company A’s process by making a proposal at that time. For that reason, the Board discussed with UBS and management that Cbeyond would likely have to wait until Company A called for preliminary indications of interest from all participants in its process before Cbeyond’s potential acquisition of Company A could move forward significantly. Management and UBS indicated that their view of Company A’s business had not changed significantly. Management further informed the Strategy Committee that Cbeyond had hired the firm of Altman Vilandrie & Co. (“Altman Vilandrie”) on February 7, 2014, as consultants to Cbeyond with respect to the potential acquisition of Company A. Management noted that Altman Vilandrie had previously served as a consultant to Cbeyond when Cbeyond explored another acquisition in 2013.

Following discussion, the Strategy Committee directed management and UBS to continue to pursue both the potential acquisition and the sale process in accordance with the timelines discussed at the meeting.

On March 4, 2014, UBS sent a letter to the remaining participants interested in acquiring Cbeyond stating that formal bids would be due on March 31, 2014. The letter indicated that Latham & Watkins would make available a draft form of merger agreement and that participants should provide written comments and proposed

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modifications to the form by March 21, 2014 in order that Cbeyond and Latham & Watkins could provide feedback prior to the participant’s formal bid on March 31, 2014. That form of merger agreement was made available to all participants in the sale process on March 14, 2014.

On March 13, 2014, Cbeyond released its financial results for the fourth quarter of 2013 and the full year 2013. The press release confirmed that Cbeyond’s review of strategic alternatives was continuing.

On March 14, 2014, the Board held a meeting attended by Messrs. Geiger, Costello, Crane, Rogan, Mucci and Ms. Wurzbacher; Mr. Fugate, Henry Lyon, Cbeyond’s chief accounting officer, William Weber, Cbeyond’s general counsel, Andy Christiansen, Cbeyond’s director of financial reporting, and a representative of Latham & Watkins. The representative of Latham & Watkins described the new form of indemnity agreement that had previously been distributed to the Board, including the changes from the existing form. The Board unanimously approved the modified form of indemnity agreement, and all parties to indemnity agreements in this form executed their new agreements on March 14, 2014.

On March 17, 2014, the Strategy Committee held a meeting attended by all members, Messrs. Costello, Mucci and Ms. Wurzbacher; Messrs. Geiger, Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. Management and UBS reported on their ongoing evaluation of the potential acquisition of Company A and their intention to provide a report to the Board on these activities at the Board’s April 2, 2014 meeting. UBS reviewed the status of discussions with potential acquirers and reviewed the terms and timeline of the process letter that had been sent to remaining potential acquirers on March 4, 2014. The representative of Latham & Watkins recommended the adoption of a management neutrality policy with respect to Cbeyond’s consideration of a potential sale. The representative of Latham & Watkins indicated that the purpose of the policy was to ensure that, in considering a potential sale, the interests of management relating to continued employment, compensation by any acquirer and equity of any acquirer would not influence Cbeyond’s decisions. Following discussion, the Strategy Committee directed Latham & Watkins to prepare a management neutrality policy for submission to the Board.

On March 21, 2014, Latham & Watkins received proposed modifications to the form of merger agreement from Jones Day (“Jones Day”), counsel to Birch. Management and Latham & Watkins, determined that the revised draft was commercially reasonable in most respects. However, they also noted that the proposed modifications from Birch with respect to the financing of the transaction did not provide sufficient certainty of closing. Moreover, in the event Birch did not close the proposed transaction because Birch did not receive required financing, Cbeyond’s sole remedy would be a cash payment to Cbeyond (a “reverse break-up fee”) equal to only 2.5% of the aggregate purchase price. UBS advised Lazard of Cbeyond’s concerns on March 27, 2014, and Latham & Watkins also advised Jones Day of the same concerns. Both UBS and Latham & Watkins indicated to their respective counterparts that failure to improve the financing provisions in connection with final proposals on March 31, 2014 would put Birch at a disadvantage compared to a potential acquirer which did not require financing to consummate the acquisition.

On March 24, 2014, Messrs. Geiger and Fugate, together with representatives of UBS met with Company A at Company A’s headquarters to receive management presentations and perform due diligence. At the meeting, management informed Company A that Cbeyond would require at least a week to review due diligence and make a revised proposal to acquire Company A.

On March 27, 2014, the Strategy Committee held a meeting attended by all members, Messrs. Costello, Mucci and Ms. Wurzbacher; Messrs. Geiger, Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. UBS reported on the status of the potential acquirers’ due diligence and, based on conversations with potential acquirers, its expectations as to which potential acquirers would submit a final proposal on March 31, 2014. UBS noted that three potential acquirers had dropped out of the process due to a variety of concerns, including a determination not to enter the SMB market, resource constraints and Cbeyond’s exposure to the SMB sector. UBS predicted that one Financial Sponsor would submit a term sheet rather than a complete proposal.

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UBS also reported on the status of the potential acquisition of Company A. UBS noted that management and UBS had visited Company A’s headquarters for management meetings and due diligence. During that visit, Company A had indicated that it would also consider selling a portion of Company A’s assets to Cbeyond and that Cbeyond indicated to Company A that Cbeyond would need at least a week to review due diligence and make any proposal to Company A.

On March 28, 2014, Cbeyond sent a revised form of indemnity agreement for the directors and certain officers together with a memorandum from Latham & Watkins and Cbeyond’s Delaware counsel, Abrams & Bayliss, LLP, which firms had drafted the revised form, outlining the proposed changes from the form of indemnity agreement then in place.

On March 31, 2014, UBS received three submissions from potential acquirers. Birch submitted a complete proposal, including proposed financing commitments and financing fee letter, as well as additional proposed modifications to the merger agreement, at a price of $9.00 per share (which was effectively a proposal at $9.16 per share based on Cbeyond’s then expected capitalization at the closing of any transaction). Birch confirmed that it required no further due diligence and anticipated that it could execute a definitive merger agreement within one to two weeks. Company B submitted an indication of interest at a price of $8.96 (which was effectively a proposal at $9.13 per share based on Cbeyond’s then expected capitalization at the closing of any transaction) but provided no proposed modifications to the form of merger agreement and no evidence of Company B’s ability to obtain the financing for the transaction that it stated would be required to complete an acquisition. Company B indicated that it would require a four-week period for conducting additional due diligence, obtaining financing for the acquisition and negotiating the definitive merger agreement. A Financial Sponsor submitted a letter of intent for a transaction at a price of $6.96 (which was effectively a proposal at $7.09 per share based on Cbeyond’s then expected capitalization at the closing of any transaction).

On April 2, 2014, the Board held a meeting attended by all of the directors, Messrs. Fugate and Clancy, representatives of UBS and a representative of Latham & Watkins. For the portion of the meeting dealing with the potential acquisition of Company A, the meeting was also attended by representatives of Altman Vilandrie.

As an initial matter, a representative of Latham & Watkins gave a report on a form of management neutrality policy that had previously been delivered to the Board, indicated that the purpose of the policy was to ensure that, in considering a potential sale, the interests of management relating to continued employment, compensation by any acquirer and equity of any acquirer would not influence Cbeyond’s decisions and recommended that the Board adopt the policy. The Board unanimously adopted the policy and each senior officer of Cbeyond executed the management neutrality policy on or before March 29, 2014.

With respect to the potential acquisition of Cbeyond, the participants discussed remaining issues that needed to be addressed in Birch’s proposal including an increase in the purchase price, improvements in the terms and conditions to Birch’s financing, a significantly increased reverse break-up fee in the event that Birch was unable to consummate its financing following execution of a definitive merger agreement, removal of a proposed condition to consummation of the merger that Cbeyond retain $29 million of cash, payment to Cbeyond’s employees of bonuses accrued prior to consummation of the merger and relaxation of proposed requirements as to Cbeyond’s conduct of the business pending consummation of the merger. The participants discussed the fact that, while Company B’s proposal had a similar price to Birch’s proposal, Company B had no preliminary commitments for financing, had not addressed the form of merger agreement and required four weeks before Company B might be in a position to sign a merger agreement. Finally the participants discussed that the per-share acquisition price proposed by the Financial Sponsor’s letter of intent was 22% and 23% lower than the per-share acquisition prices proposed by Company B and Birch, respectively, and that the Financial Sponsor had not addressed the form of merger agreement.

The participants also discussed the status of Cbeyond’s investigation of a potential acquisition of Company A. Representatives from Altman Vilandrie presented a report on the potential acquisition including a revised

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potential business plan for Company A based on its analysis and potential cost and revenue synergies. UBS discussed with the Board a preliminary analysis of a potential business plan derived from projections from Cbeyond’s management, a pro forma growth profile, a valuation matrix based on various assumptions, potential sources and uses of funds in an acquisition of Company A and an analysis of potential liquidity for Cbeyond following an acquisition of Company A. UBS discussed with the Board that an increase in Cbeyond stockholder value arising from an acquisition of Company A would likely be delayed absent a positive change in the metric multiples at which Cbeyond’s common stock had been trading. UBS also discussed certain considerations for the Board in comparing an acquisition of Company A to Cbeyond’s value as a stand-alone company based on management’s Updated Base Case Projections. UBS then reviewed with the Board certain potential benefits from an acquisition of Company A, including increased scale, an expanded network, an expanded number of customers and potential growth in EBITDA and EBITDA margin. UBS also reviewed certain potential considerations of an acquisition of Company A, including a significant increase in leverage for Cbeyond’s balance sheet, risks of integration, a “doubling down” of the risks of legacy Cbeyond 1.0 business and significant delays in the combined companies’ ability to generate meaningful cash flow. Following such discussion, management indicated that it could not presently recommend an acquisition of Company A at Company A’s desired price, but believed that an acquisition of Company A at a lower price or an acquisition of a portion of Company A’s business might be a viable alternative to a sale of Cbeyond, particularly if Cbeyond provided equity to the holders of Company A’s stock as part of the consideration in an acquisition. UBS noted that Company A was seeking a more “developed” bid from Cbeyond in the next several days.

Following discussion, the Board unanimously directed that management, UBS and Latham & Watkins pursue improvement of Birch’s proposal consistent with the matters discussed at the meeting, that management and UBS continue to work with Company B and inform Company B that, while its price was competitive, Company B needed to complete due diligence and secure financing for the acquisition quickly, and that UBS inform the Financial Sponsor that the Financial Sponsor’s bid was not competitive and the Financial Sponsor would be dropped from the process. The Board also directed management and UBS to continue to pursue opportunities to acquire Company A or the portion of Company A desired by Cbeyond.

Between April 2, 2014 and April 5, 2014, UBS conveyed the Board’s position to each of the remaining participants in the sale and acquisition processes. In addition, on April 4, 2014, Lazard contacted UBS to request guidance regarding the transaction values that may be attractive to Cbeyond.

On April 5, 2015, the Board held a meeting attended by all directors, Messrs. Fugate and Clancy; representatives of UBS and a representative of Latham & Watkins. The representative of Latham & Watkins advised the directors as to their fiduciary duties based on a written presentation from Latham & Watkins that had been distributed to the directors on April 1, 2014. UBS described conversations with Lazard on behalf of Birch in which Lazard indicated Birch’s desire to move quickly to reach an agreement and Birch’s potential willingness to increase the proposed purchase price. UBS also described conversations with Company B in which UBS urged Company B to move forward promptly with its due diligence and obtain commitments for the financing that would be required for an acquisition.

UBS also described its conversations with Company A’s financial advisor in which UBS reiterated Cbeyond’s valuation of Company A and indicated that Cbeyond might be willing to pay some portion of the consideration for Company A in the form of Cbeyond’s common stock. UBS noted that Company A’s financial advisor had indicated that Company A would require a written proposal from Cbeyond before additional interaction between the companies could take place. Mr. Geiger asked the Board to consider providing an indication of interest to Company A that would provide for a lower price but that would include a component of Cbeyond common stock.

UBS discussed with the Board certain preliminary analyses of Cbeyond’s position in both the sale and acquisition processes, including Cbeyond’s historical trading prices, premiums and other metrics at various

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acquisition prices, a preliminary discounted cash flow analysis of Cbeyond’s value as a stand-alone company under Cbeyond’s business plan based on the Updated Base Case Projections, an analysis of potential financing leverage for Birch under its proposed transaction and projections for leverage and value creation in an acquisition by Cbeyond of Company A.

The representative of Latham & Watkins asked each member of the Board to express his or her opinion as to appropriate goals and next steps for the sale and acquisition processes. Following discussion, the Board unanimously determined that Cbeyond should continue both processes. With respect to Birch, the Board directed UBS to inform Lazard on behalf of Birch that Birch needed to improve both its proposed price to $323 million, or $10 per share based on Cbeyond’s then expected capitalization at closing, and the provisions proposed by Birch in the merger agreement relating to Birch’s financing commitments and reverse break-up fee. With respect to Company B, the Board instructed UBS to continue to press Company B to complete its due diligence and to obtain firm financing commitments. With respect to the potential acquisition of Company A, the Board instructed UBS to convey to Company A’s financial advisor that Cbeyond required additional due diligence pending any revised proposal.

On April 6, 2014, UBS spoke to Lazard on behalf of Birch to transmit the message described at the April 5, 2014 Board meeting. Lazard indicated that it expected Birch to respond quickly and that Lazard believed that the financing issues could also be resolved quickly.

On April 7, 2014, Birch delivered a letter to UBS containing a revised proposal at $10.00 per share of Cbeyond’s common stock based on the assumption that there would be 32.3 million shares of Cbeyond common stock outstanding at the closing of a transaction, indicating that this was Birch’s best and final proposal. On the same day, Company B’s financial advisor delivered to UBS a written request for substantial additional due diligence materials.

In addition, on April 7, 2014, the financial advisor to Company A called UBS to convey Company A’s reaction to Cbeyond’s latest proposal, in which the financial advisor indicated verbally that at the valuation Cbeyond had proposed, that Company A would prefer to take less consideration in cash and more in Cbeyond stock and that certain aspects of Company A’s capital structure limiting stock consideration could be addressed.

Following these activities on April 7, 2014, the Board held a telephonic meeting attended by all directors, Messrs. Fugate and Clancy, representatives of UBS and representatives of Latham & Watkins, including the Latham & Watkins representative reviewing the financing aspects of Birch’s proposal. UBS updated the Board on the activities described above occurring earlier on April 7, 2014. Latham & Watkins requested that each director give his or her views as to next steps in the sale and acquisition processes. Following discussion, the Board directed that Latham & Watkins should prepare a revised merger agreement addressing the remaining concerns to be delivered by UBS to Lazard on behalf of Birch with commentary that the Board had considered Birch’s revised price proposal constructive. The Board directed UBS to continue encouraging Company B to complete its due diligence and to provide Cbeyond with a firm financing proposal. The Board also directed management and UBS to continue work on a proposal for the acquisition of Company A with a mixture of cash and common stock at a reduced price.

On April 8, 2014, Latham & Watkins delivered a revised draft of the merger agreement to Jones Day. Latham & Watkins continued to exchange drafts of the merger agreement with Jones Day until April 18, 2014.

On April 9, 2014, UBS spoke with Company B’s financial advisor to discuss Company B’s due diligence request and the implications for the timing of agreeing on definitive documents for a transaction. UBS indicated to Company B’s financial advisor that, at Company B’s present stage of due diligence and financing, there was no actionable transaction for the Board to consider.

On April 10, 2014, at Cbeyond’s direction, UBS spoke to Lazard. UBS conveyed that, following Jones Day’s response to Latham & Watkins revised form of merger agreement delivered to Jones Day on April 8, 2014,

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there remained a number of significant issues, including financing provisions and reverse break-up fee, restrictions on operation of Cbeyond’s business between execution and closing of the merger agreement and treatment of continuing employees of Cbeyond both from execution to closing of the merger agreement and post-closing. UBS informed Lazard that the parties were not, therefore, close to execution of a merger agreement.

On the same date, at Cbeyond’s direction, UBS spoke to the financial advisor to Company A indicating that Cbeyond would need to perform additional analysis before Cbeyond could respond to Company A’s proposal that the consideration for the acquisition of Company A include Cbeyond’s common stock as well as cash and that to perform that, Cbeyond would need to perform additional due diligence. Mr. Geiger reinforced these requests and discussed potential transactions with Company A’s financial advisor and Company A’s chief executive officer in telephone conversations on April 14, 2014.

Latham & Watkins and Jones Day continued to negotiate open items in the merger agreement in drafts exchanged during the period April 8 through April 13, 2014, but were unable to make substantial process. Specifically, on April 9, 2014, Jones Day delivered a revised draft merger agreement to Latham & Watkins and then delivered a further revised draft to Latham & Watkins on April 11, 2014. Later in the day on April 11, 2014, Latham & Watkins delivered a revised draft of the merger agreement to Jones Day. On April 12, 2014, Jones Day delivered a revised draft of the merger agreement to Latham & Watkins.

On April 13, 2014, Latham & Watkins and Jones Day discussed the remaining open issues. Latham & Watkins suggested that Birch and Cbeyond meet in person regarding certain of the open issues. On April 13, 2014, Messrs. Fugate and Clancy met in person with Vincent Oddo, president and chief executive officer of Birch, and Edward James, chief financial officer of Birch, to discuss the open issues. Following those discussions, Messrs. Fugate and James exchanged emails to summarize their discussions on April 13, 2014 and April 14, 2014.

On April 14, 2014, at Cbeyond’s direction, UBS discussed with Lazard the unresolved issues in the merger agreement. UBS indicated that Birch’s failure to move on a number of these issues could prevent the parties from reaching agreement on a transaction. Latham & Watkins and Jones Day also participated in a telephone call to discuss open issues on the financing provisions in the merger agreement. Later that evening, Latham & Watkins delivered a revised draft of the merger agreement to Jones Day. Latham & Watkins reiterated to Jones Day that the Board had a regularly scheduled Board meeting on April 16, 2014 and that if Birch desired to have the Board approve the merger agreement for execution following that meeting, the proposed definitive agreement would need to be ready by 3:00 p.m. EDT on April 15, 2014 in order to give the Board adequate time to review the merger agreement.

On April 15, 2014, management and Company B had a due diligence call.

At approximately 1:30 p.m. on April 15, 2014, Jones Day delivered comments on the merger agreement to Latham & Watkins. Management, UBS and Latham & Watkins discussed the new comments, which included several significant changes relating to pricing, operation of Cbeyond’s business and an increase in the reverse break-up fee, raising it from 2.5% to 4%. Following discussion, at Cbeyond’s direction, UBS informed Lazard, and Latham & Watkins informed Jones Day, that the changes proposed were significant and therefore the Board would not be in a position to make any decision on the merger agreement at its Board meeting on April 16, 2014. In addition, at Cbeyond’s direction, each of UBS and Latham & Watkins conveyed to their counterparts at Lazard and Jones Day, respectively, that the parties were sufficiently far apart that Cbeyond felt that, in order to assess whether a transaction was possible, the parties should meet in person in Atlanta after conclusion of the Board meeting on April 16, 2014 to see whether terms could be reached. Later that day, Lazard and Jones Day confirmed that Birch was agreeable to such a meeting.

On April 16, 2014, the Board held a meeting attended by all directors; Messrs. Fugate and Clancy; representatives of UBS and representatives of Latham & Watkins. At the Board meeting, UBS updated the Board

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on the status of discussions with Company B. In addition, UBS presented an updated preliminary analysis of the potential acquisition of Company A, based in part on analysis and due diligence performed by Altman Vilandrie and Cbeyond; revenue mixtures between Cbeyond 1.0 and Cbeyond 2.0 revenue; potential synergies; a potential transaction overview with consideration including cash and Cbeyond common stock; a pro forma liquidity analysis and illustrative stockholder value creation.

With respect to a potential acquisition of Cbeyond by Birch, Latham & Watkins described the open issues in the merger agreement, including (1) the calculation of the purchase price and Cbeyond’s desire for a fixed price based on Cbeyond’s estimate that 32,285,620 shares of common stock and 57,041 options (assuming a net exercise) to purchase common stock would be outstanding at a closing of a merger with Birch, (2) Cbeyond’s ability to pay a bonus to its employees in accordance with its existing plan metrics with respect to the period prior to closing of the merger, (3) an increased reverse break-up fee, (4) the ability to provide Board members with their regular grant of restricted stock in June 2014 (such stock to vest on a daily basis until closing of the merger), (5) Cbeyond’s ability to incur additional capital leases relating to its fiber construction and (6) the removal, as a closing condition, of the regulatory approvals necessary in connection with Birch’s financing in states where Cbeyond does not operate. Latham & Watkins, management and UBS outlined the parties’ positions and asked the Board to authorize them to propose Cbeyond’s positions at the meeting scheduled with Birch following the Board meeting. A Latham & Watkins representative asked each director to express his or her opinion as to next steps in the sale and acquisition processes. The Board unanimously directed management, UBS and Latham & Watkins to take the recommended positions with Birch, but maintain flexibility in light of the status of discussions with Companies A and B. The Board also directed management, UBS and Latham & Watkins to continue to work with Companies A and B until it was clear that a satisfactory merger agreement could be executed with Birch.

At 2:30 p.m. on April 16, 2014, Messrs. Geiger, Fugate, Clancy and Weber, a representative of UBS and representatives of Latham & Watkins met with Messrs. Oddo and James, a member of the board of directors of Birch (who participated telephonically), representatives of Lazard and representatives of Jones Day in Atlanta. At the meeting, the parties discussed the outstanding issues outlined in the preceding paragraph. Following discussion, Birch and Cbeyond reached mutual agreement on each of the open issues. The parties also discussed timing for a meeting of the Board and execution of a definitive merger agreement. Specifically, Cbeyond described the travel schedule of the directors, recognized the upcoming “Good Friday” holiday and identified Cbeyond’s desire to provide the Board with sufficient time to review the final merger agreement prior to a Board meeting. The parties then instructed Latham & Watkins and Jones Day to revise the draft merger agreement so that the merger agreement could be delivered to members of the Board by April 18, 2014 in preparation for a Board meeting on April 19, 2014. After this meeting, on April 16, 2014, Latham & Watkins delivered a revised draft of the merger agreement to Jones Day.

On April 17, 2014, Cbeyond discovered that, due to an omission of certain shares of Cbeyond restricted stock in a report provided by the agent that administers Cbeyond’s employee stock plan, Cbeyond’s assessment of the number of shares of common stock that would be outstanding at the closing of a merger with Birch was approximately 86,800 shares higher than what Cbeyond had previously presented to Birch. Following conversations among management and Latham & Watkins, Cbeyond determined that Cbeyond would not seek to change the fixed aggregate consideration to be paid by Birch which had been discussed at the in-person meeting between the parties on April 16, 2014. On April 17, 2014, Jones Day delivered a revised draft of the merger agreement to Latham & Watkins.

On April 18, 2014, Latham & Watkins and Jones Day completed the form of merger agreement. The merger agreement contained a number of provisions favorable to Cbeyond, including broad fiduciary outs in the event of a superior proposal, a modest termination fee of 2.5% of the implied enterprise value in the Merger and a reverse break-up fee of 5%. On the same date, Cbeyond sent materials to the Board that included the proposed form of merger agreement and Cbeyond disclosure letter, materials previously delivered concerning the Board’s fiduciary duties, a presentation by UBS, a summary of the proposed merger agreement prepared by Latham & Watkins and the form of resolutions to be adopted at the Board meeting.

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On April 19, 2014, the Board held a meeting attended by all directors; Messrs. Fugate, Clancy and Weber; representatives of UBS and representatives of Latham & Watkins. Messrs. Geiger and Fugate, together with representatives of UBS and Latham & Watkins gave a report on the meeting between the representatives of Cbeyond and Birch and their respective advisors that occurred on the afternoon of April 16, 2014. A representative of Latham & Watkins informed the Board of its fiduciary duties in the context of the proposed merger agreement. UBS reviewed with the Board a summary of Cbeyond’s activities during Cbeyond’s review of strategic alternatives, a summary of the proposed transaction, selected transaction data relating to premiums and multiples of EBITDA, the stock price performance of Cbeyond’s common stock, summary historical and projected financials, an analysis of the value of Cbeyond’s common stock based on management’s projections on a discounted cash flow basis, illustrative comparable company analysis and illustrative selected transactions analysis. UBS then provided to the Board its oral opinion, which opinion was subsequently confirmed by delivery of a written opinion, that, as of April 19, 2014 and based on and subject to various assumptions made, matters considered and limitations described in its written opinion, that the Per Share Merger Consideration to be received by the holders of shares of Cbeyond common stock was fair, from a financial point of view, to such stockholders. Latham & Watkins provided a presentation outlining the terms of the merger agreement and discussed the resolutions to be adopted by the Board if the Board determined to approve entering into the merger agreement. Each member of the Board was given the opportunity to ask questions of management, UBS and Latham & Watkins. Latham & Watkins also asked for each Board member’s individual opinion as to whether Cbeyond should enter into the merger agreement. During the discussion, the Board members noted that neither the potential acquisition of Company A nor the proposed purchase of Cbeyond by Company B were near to actionable, that both would require significant additional time and negotiation and that the merger agreement with Birch would provide superior consideration to stockholders in the next several years as compared to a “stand-alone” strategy for Cbeyond. Following discussion, the Board unanimously adopted the resolutions presented at the meeting including resolutions that (i) the Merger and the transactions contemplated by the Merger Agreement be, and are hereby approved (including for purposes of Section 203 of the DGCL), adopted and declared to be advisable, substantively and procedurally fair to, and in the best interests of, Cbeyond and its stockholders, (ii) authorizing, accepting, approving and adopting the Merger Agreement, and the terms and conditions set forth therein and (iii) recommending that the stockholders of Cbeyond adopt the Merger Agreement and approve the Merger and the other transactions contemplated thereby.

Following the Board meeting, the merger agreement was executed by each of the parties to the merger agreement. Cbeyond and Birch then drafted a joint press release announcing the transaction, which was issued before the opening of the stock market on April 21, 2014.

Reasons for the Merger and Recommendation of Cbeyond’s Board of Directors

Cbeyond’s Board of Directors, at a meeting duly called, determined that the Merger and the transactions contemplated by the Merger Agreement are advisable, substantively and procedurally fair to, and in the best interests of, Cbeyond and its stockholders, unanimously authorized, accepted, approved and adopted the Merger Agreement and the transactions contemplated therein, including the Merger, and recommended that Cbeyond’s stockholders vote “FOR” the proposal to adopt the Merger Agreement and approve the Merger and other transactions contemplated by the Merger Agreement. In the course of reaching its decision to recommend that Cbeyond’s stockholders vote “FOR” the proposal to adopt the Merger Agreement and approve the Merger and other transactions contemplated by the Merger Agreement, Cbeyond’s Board of Directors retained and consulted with its financial advisors, reviewed a significant amount of information and considered a number of reasons, including the following:

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In the course of its deliberations, the Board of Directors also considered a variety of risks and other countervailing factors concerning the Merger Agreement and the Merger, including the following:

The foregoing discussion of the reasons and factors considered by the Board of Directors is not intended to be exhaustive, but does set forth the principal factors considered by them. The members of the Board of Directors collectively reached the conclusion to recommend the approval of the proposal to adopt the Merger Agreement in light of the various reasons and factors described above and other reasons and factors that each member of the Board of Directors believed were appropriate. In view of the wide variety of factors considered by the Board of Directors in connection with its evaluation of the Merger and the complexity of these matters, the Board of Directors did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision and did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to its ultimate determination. Rather, the Board of Directors made its recommendation based on the totality of information presented to it and the investigation conducted by it. In considering the reasons and factors discussed above, individual directors may have given different weights to different reasons and factors.

After evaluating these reasons and factors, Cbeyond’s Board of Directors determined that the Merger and the transactions contemplated by the Merger Agreement are advisable, substantially and procedurally fair to, and in the best interests of Cbeyond and its stockholders and unanimously authorized, accepted, approved and adopted the Merger Agreement and the transactions contemplated therein, including the Merger. Accordingly, Cbeyond’s Board of Directors approved the Merger Agreement and recommends that Cbeyond’s stockholders approve the proposal to adopt the Merger Agreement.

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The Board of Directors recommends that the stockholders of Cbeyond vote “FOR” the proposal to adopt the Merger Agreement and approve the Merger and other transactions contemplated by the Merger Agreement.

Opinion of UBS as Financial Advisor to Cbeyond

Cbeyond retained UBS to act as financial advisor to Cbeyond’s Board of Directors and, if requested, to render to Cbeyond’s Board of Directors an opinion as to the fairness, from a financial point of view, of the Per Share Merger Consideration to be received by the holders of Cbeyond common stock. On April 19, 2014, at a meeting of Cbeyond’s Board of Directors held to evaluate the proposed merger, UBS delivered to Cbeyond’s Board of Directors an oral opinion, which opinion was confirmed by delivery of a written opinion, dated April 19, 2014, to the effect that, as of that date and based on and subject to various assumptions made, matters considered and limitations described in its opinion, the Per Share Merger Consideration to be received by the holders of Cbeyond common stock was fair, from a financial point of view, to such holders.

The full text of UBS’ opinion to Cbeyond’s Board of Directors describes the assumptions made, procedures followed, matters considered and limitations on the review undertaken by UBS. This opinion is attached to this proxy statement as Annex B and is incorporated herein by reference. Holders of Cbeyond common stock are encouraged to read UBS’ opinion carefully in its entirety. UBS’ opinion was provided for the benefit of Cbeyond’s Board of Directors (in its capacity as such) in connection with, and for the purpose of, its evaluation of the Per Share Merger Consideration, from a financial point of view, and does not address any other aspect of the Merger or any related transaction. UBS’ opinion does not address the relative merits of the Merger or any related transaction as compared to other business strategies or transactions that might be available with respect to Cbeyond or Cbeyond’s underlying business decision to effect the Merger. UBS’ opinion does not constitute a recommendation to any stockholder as to how such stockholder should vote or act with respect to the Merger or any related transaction. The following summary of UBS’ opinion is qualified in its entirety by reference to the full text of UBS’ opinion.

In arriving at its opinion, UBS, among other things:

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In connection with its review, with the consent of Cbeyond’s Board of Directors, UBS assumed and relied upon, without independent verification, the accuracy and completeness in all material respects of the information provided to or reviewed by UBS for the purpose of its opinion. In addition, with the consent of Cbeyond’s Board of Directors, UBS did not make any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Cbeyond, nor was UBS furnished with any such evaluation or appraisal. With respect to the financial forecasts and estimates referred to above, UBS assumed, at the direction of Cbeyond’s Board of Directors, that they were reasonably prepared in good faith on a basis reflecting the best currently available estimates and judgments of the management of Cbeyond as to the future financial performance of Cbeyond. UBS further relied upon and assumed at the direction of Cbeyond’s Board of Directors, without independent verification, that there has been no change in the business, asset, liabilities, financial condition, results of operations, cash flows or prospects of Cbeyond since the respective dates of the most recent financial statements and other information, financial or otherwise, provided to UBS, except for such changes as would not be material to UBS’ analysis or opinion and that there is no information or any facts that would make any of the information discussed with or reviewed by UBS incomplete or misleading. UBS’ opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information available to it as of, the date of its opinion.

At the request of Cbeyond’s Board of Directors, UBS contacted third parties to solicit indications of interest in a possible transaction with Cbeyond and held discussions with certain of these parties prior to the date of its opinion. At the direction of Cbeyond’s Board of Directors, UBS was not asked to, nor did UBS, offer any opinion as to the terms, other than the Per Share Merger Consideration to the extent expressly specified in UBS’ opinion, of the Merger Agreement or any related documents or the form of the Merger or any related transaction. In addition, UBS expressed no opinion as to the fairness of the amount or nature of any compensation to be received by any officers, directors or employees of any parties to the Merger, or any class of such persons, relative to the Per Share Merger Consideration. In rendering its opinion, UBS assumed, with the consent of Cbeyond’s Board of Directors, that (i) the parties to the Merger Agreement would comply with all material terms of the Merger Agreement, (ii) the Merger would be consummated in accordance with the terms of the Merger Agreement without any adverse waiver or amendment of any material term or condition thereof, and (iii) the adjustment (if any) to the Per Share Merger Consideration will not be material in any respect to UBS’ analyses or opinion. UBS also assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the Merger would be obtained without any material adverse effect on Cbeyond, Birch or the Merger. The issuance of UBS’ opinion was approved by an authorized committee of UBS.

In connection with rendering its opinion to Cbeyond’s Board of Directors, UBS performed a variety of financial and comparative analyses which are summarized below. The following summary is not a complete description of all analyses performed and factors considered by UBS in connection with its opinion. The preparation of a financial opinion is a complex process involving subjective judgments and is not necessarily susceptible to partial analysis or summary description. With respect to the selected companies analysis and the selected transactions analysis summarized below, no company or transaction used as a comparison was identical to Cbeyond or the Merger. These analyses necessarily involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the public trading or acquisition values of the companies concerned.

UBS believes that its analyses and the summary contained in this proxy statement must be considered as a whole and that selecting portions of its analyses and factors or focusing on information presented in tabular format, without considering all analyses and factors or the narrative description of the analyses, could create a misleading or incomplete view of the processes underlying UBS’ analyses and opinion. UBS did not draw, in isolation, conclusions from or with regard to any one factor or method of analysis for purposes of its opinion, but rather arrived at its ultimate opinion based on the results of all analyses undertaken by it and assessed as a whole.

The estimates of the future performance of Cbeyond underlying UBS’ analyses are not necessarily indicative of actual future results or values, which may be significantly more or less favorable than those

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estimates. These estimates are necessarily subject to uncertainty because, among other things, they are based upon numerous factors and events beyond the control of the parties or their respective advisors. In performing its analyses, UBS considered industry performance, general business and economic conditions and other matters, many of which were beyond the control of Cbeyond. Estimates of the financial value of companies do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold or acquired.

The Per Share Merger Consideration was determined through negotiation between Cbeyond and Birch and the decision by Cbeyond to enter into the Merger was solely that of Cbeyond’s Board of Directors. UBS’ opinion and financial analyses were only one of many factors considered by Cbeyond’s Board of Directors in its evaluation of the Merger and should not be viewed as determinative of the views of Cbeyond’s Board of Directors or management of Cbeyond with respect to the Merger or the Per Share Merger Consideration. While UBS provided advice to Cbeyond’s Board of Directors during Cbeyond’s negotiation with Birch, Cbeyond’s Board of Directors determined the Per Share Merger Consideration and UBS did not recommend any specific amount or type of merger consideration.

The following is a brief summary of the material financial analyses performed by UBS and reviewed with Cbeyond’s Board of Directors on April 19, 2014 in connection with UBS’ opinion. The financial analyses summarized below include information presented in tabular format. In order for UBS’ financial analyses to be fully understood, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of UBS’ financial analyses.

Discounted Cash Flow Analysis

UBS performed a discounted cash flow analysis utilizing financial forecasts and estimates prepared by Cbeyond’s management. UBS calculated a range of implied present values (as of December 31, 2013) of the standalone unlevered, after-tax, free cash flows that Cbeyond was forecasted to generate from calendar year 2014 through calendar year 2018 and of terminal values for Cbeyond, plus the present value of the cash tax savings from Cbeyond’s federal and state net operating loss carryforwards, estimated by Cbeyond’s management, referred to as NOLs. In performing its discounted cash flow analysis, UBS utilized the Updated Base Case Projections created by Cbeyond’s management. See the section entitled “The Merger—Financial Information Forecasts” beginning on page 52 for more information. Implied terminal values were derived by applying to Cbeyond’s calendar year 2018 estimated EBITDA, a range of last 12 months, referred to as LTM, estimated EBITDA multiples of 4.0x to 6.0x. Present values of cash flows and terminal values were calculated using discount rates ranging from 10.0% to 12.0%, which range was selected based on the weighted average cost of capital of Cbeyond, and the present value of Cbeyond’s NOLs was calculated using a discount rate of 11%, the mid-point of the range based on Cbeyond’s weighted average cost of capital.

The discounted cash flow analysis resulted in a range of implied present values of approximately $4.07 to $7.63 per share of Cbeyond common stock, as compared to the Per Share Merger Consideration.

Selected Public Companies Analysis

UBS compared selected financial and stock market data of Cbeyond with corresponding data of certain publicly traded telecommunications companies. Based upon its professional judgment and expertise, UBS deemed EarthLink Holdings Corp. to be the most relevant comparable public company because it has the most similar business profile, product set, asset intensity, growth, margin and cash flow profile to Cbeyond. UBS also reviewed, for informational purposes, financial and stock market data for the four other large telecommunications companies listed in the table below, although UBS deemed such companies less relevant for purposes of

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comparison to Cbeyond due to their financial and operational characteristics. UBS reviewed, among other things, the enterprise values, calculated as equity market value based on closing stock prices on April 17, 2014, plus debt, less cash, of the selected companies as a multiple of calendar year 2014 and 2015 estimated EBITDA. Estimated EBITDA represented I/B/E/S consensus estimates as of April 17, 2014. I/B/E/S is a database owned and operated by Thomson Financial, which contains estimated earnings, cash flows, dividends and other data based on published reports by equity research analysts for companies in the U.S. and foreign markets. UBS then compared the multiples derived for the selected companies with corresponding multiples implied for Cbeyond based on the closing price of Cbeyond common stock on April 17, 2014 and the Per Share Merger Consideration. This analysis indicated the following implied multiples for the selected companies, as compared to corresponding multiples implied for Cbeyond:

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UBS reviewed, among other things, transaction values in the selected transactions, calculated as the purchase price paid for the target company’s equity, plus debt, less cash as a multiple of the LTM EBITDA and estimated EBITDA for the current unreported fiscal year, referred to as FY+1. UBS then compared these multiples derived for the selected transactions with corresponding multiples implied for Cbeyond based on the closing price of Cbeyond common stock on April 17, 2014 and the Per Share Merger Consideration. Financial data regarding the selected transactions were based on publicly available information, MergerMarket and Wall Street research as of the time of announcement of the relevant transaction. This analysis indicated the following implied high, mean, median and low multiples for the selected transactions, as compared to corresponding multiples implied for Cbeyond:

Other Factors

In rendering its opinion, UBS also reviewed, for informational purposes:

Miscellaneous

Under the terms of UBS’ engagement, Cbeyond agreed to pay UBS for its financial advisory services in connection with the Merger an aggregate fee currently estimated to be approximately $3.2 million, a portion of which has been paid in connection with UBS’ opinion and approximately $2.5 million of which is contingent upon consummation of the Merger. In addition, under the terms of UBS’ engagement, in the event of an acquisition transaction by Cbeyond, UBS would have been compensated in a similar manner, although with a reduced minimum payment amount. In addition, Cbeyond agreed to reimburse UBS for its reasonable expenses, including fees, disbursements and other charges of counsel, and to indemnify UBS and related parties against

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liabilities, including liabilities under federal securities laws, relating to, or arising out of, its engagement. In the ordinary course of business, UBS and its affiliates may hold or trade, for their own accounts and the accounts of their customers, securities of Cbeyond and accordingly, may at any time hold a long or short position in such securities.

Cbeyond selected UBS as its financial advisor in connection with the Merger because UBS is an internationally recognized investment banking firm with substantial experience in similar transactions. UBS is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, leveraged buyouts, negotiated underwritings, competitive bids, secondary distributions of listed and unlisted securities and private placements.