Investors, including Chairman Richard Aab, have invested $5 million in US LEC as part of the telecommunication company’s refinancing efforts.

Aab is one of 13 investors who put up the additional cash, according to a company spokesperson. US LEC would not breakdown the amount invested by each but did say “no one invested more than Mr. Aab.”

In conjunction with the effort, US LEC said it struck agreements with its lenders to restructure debt payments due in 2003. The deal will free up cash flow and help US LEC focus on market growth, says chief financial officer Michael Robinson.

The company is expected to close the books on 2002 with well over $20 million in cash and equivalents onhand.

US LEC will defer $30 million in term loan principal from 2003-04 to 2005-06 and will defer $25 million in principal payments on its revolving credit facility. An $8 million principal payment was made to its lenders when the $5 million in investment closed.

In exchange for the investment, which is subordinated debt, the investors received notes at 11 percent interest which mature in 2007. The deal includes warrants to purchase 2.6 million shares of common stock at $1.90 a share.

US LEC (Nasdaq: CLEC) stock closed at $2.18 on Thursday, down 7 cents.