Windstream 2011 Annual Report Download - page 164

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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F-56
maximum leverage ratio, with the most restrictive being 4.75 to 1.0. As of December 31, 2011, we were in compliance with all
of our covenants.
On August 11, 2011, in connection with our acquisition of PAETEC, we amended our senior secured credit agreement to,
among other things, (i) permit the issuance of bridge loans, (ii) permit the issuance and repayment of escrow notes, (iii) waive
guaranty and security requirements with regard to PAETEC and its subsidiaries, (iv) delete the capital expenditures covenant
and (v) waive any breach due to the change of control provisions under PAETEC's outstanding notes. In addition, we amended
the security agreement to, among other things, waive the obligation to grant security on accounts relating to escrow notes and
the proceeds of notes held in such accounts.
In addition, certain of our debt agreements contain various covenants and restrictions specific to the subsidiary that is the legal
counterparty to the agreement. Under our long-term debt agreements, acceleration of principal payments would occur upon
payment default, violation of debt covenants not cured within 30 days, a change in control including a person or group
obtaining 50 percent or more of our outstanding voting stock, or breach of certain other conditions set forth in the borrowing
agreements. We were in compliance with these covenants as of December 31, 2011.
Maturities for debt outstanding as of December 31, 2011 for each of the twelve month periods ended December 31, 2012, 2013,
2014, 2015 and 2016 were $193.9 million, $1,254.0 million, $10.9 million, $2,091.5 million and $0.1 million, respectively.
Loss on Extinguishment of Debt
During 2011, we purchased all $1,746 million of our 2016 Notes and all $400.0 million of our Valor Notes. We financed these
transactions with proceeds from the issuance of the 2020 Notes, the 2021 Notes, the 2023 Notes and borrowings from our
revolving line of credit. These transactions allowed us to extend our existing debt maturities and lower our interest rates. The
retirements were accounted for under the extinguishment method, and as a result we recognized a loss on extinguishment of
debt of $136.1 million during 2011.
The loss on extinguishment of debt is shown as follows for the twelve months ended December 31, 2011:
(Millions)
2016 Notes:
Premium on early redemption
Unamortized discount on original issuance
Third-party fees for early redemption
Unamortized debt issuance costs on original issuance
Loss on early extinguishment for 2016 Notes
Valor Notes:
Premium on early redemption
Third-party fees for early redemption
Unamortized premium on original issuance
Loss on early extinguishment for Valor Notes
Total loss on early extinguishment of debt
Twelve
Months Ended
$ 101.2
26.6
3.0
1.1
131.9
10.3
0.4
(6.5)
4.2
$ 136.1