Windstream 2013 Annual Report Download - page 192

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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5. Long-term Debt and Capital Lease Obligations, Continued:
Senior Secured Credit Facilities
On December 6, 2013, Windstream Corp. incurred new borrowings of $590.0 million under Tranche B5 of the senior secured
credit facility due August 8, 2019. The proceeds along with available cash on hand were used to repay $592.5 million of
borrowings, plus accrued interest, that were outstanding under Tranche B3 of the senior secured credit facility, which were also
due on August 8, 2019. Debt issuance costs associated with the new borrowings were $4.6 million which were charged to
interest expense in the fourth quarter of 2013 in accordance with debt modification accounting.
On January 23, 2013, Windstream Corp. incurred new borrowings of $1,345.0 million under Tranche B4 of the senior secured
credit facility due January 23, 2020; the proceeds of which were used to repay $19.5 million of Tranche A2 and $280.9 million
of Tranche B due in July 2013 and $1,042.9 million of Tranche B2 of the senior secured credit facility due in December 2015,
plus accrued interest. Debt issuance costs associated with the new borrowings were $11.9 million. Of this amount, $5.7 million
was recorded in other assets in the consolidated balance sheet and will be amortized into interest expense over the life of the
borrowings. The remaining $6.2 million of debt issuance costs were charged to interest expense in the first quarter of 2013 in
accordance with debt modification accounting.
Effective August 8, 2012, Windstream Corp. incurred new borrowings of $300.0 million of Tranche A4 senior secured credit
facilities due August 8, 2017 and $600.0 million of Tranche B3 senior secured credit facilities due August 8, 2019. The
additional term loan proceeds were used to repay Windstream Corp.'s revolver borrowings and for general corporate purposes,
thereby creating sufficient liquidity to repay the 2013 debt maturities. Debt issuance costs associated with the new borrowings
were $16.6 million, which were recorded in other assets in the accompanying consolidated balance sheet and will be amortized
into interest expense over the life of the borrowings.
Effective February 23, 2012, Windstream Corp. amended and restated $150.4 million of the Tranche A2 senior secured credit
facilities outstanding to Tranche A3 and extended the maturity to December 30, 2016. In addition, Windstream Corp. incurred
new borrowings of $280.0 million of Tranche A3 senior secured credit facilities, which will also be due December 30, 2016.
Debt issuance costs associated with the new borrowings were $1.8 million and were recorded in other assets in the
accompanying consolidated balance sheet and will be amortized into interest expense over the life of the borrowings.
Revolving line of credit - Windstream Corp. borrowed $1,770.0 million under the revolving line of credit in Windstream
Corp.'s senior secured credit facility and later repaid $1,180.0 million during 2013. Letters of credit are deducted in
determining the total amount available for borrowing under the revolving line of credit. Accordingly, the total amount
outstanding under the letters of credit and the indebtedness incurred under the revolving line of credit may not exceed $1,250.0
million. Considering letters of credit of $16.8 million, the amount available for borrowing under the revolving line of credit
was $643.2 million at December 31, 2013.
The variable interest rate on the revolving line of credit ranged from 2.42 percent to 4.50 percent, and the weighted average rate
on amounts outstanding was 2.60 percent during 2013, as compared to variable interest rates during 2012 which ranged from
2.47 percent to 4.50 percent with a weighted average rate on amounts outstanding of 2.53 percent. The revolving line of credit
will expire December 17, 2015.
Debentures and Notes Issued in 2013
2021 Notes - On August 26, 2013, Windstream Corp. completed the private placement of $500.0 million in aggregate principal
amount of 7.750 percent senior unsecured notes due October 1, 2021, at an issue price of 103.500 percent to yield 7.171
percent ("the 2021 Notes"). Interest is paid semi-annually. The notes had terms substantially identical to the terms of the
existing 7.750 percent senior notes due 2021, but were issued under a separate indenture. During the fourth quarter of 2013
pursuant to a registration rights agreement, the notes were exchanged for additional 7.750 percent senior notes due 2021 issued
under the indenture governing the existing notes. For financial reporting purposes, both the newly issued and existing 7.750
percent senior notes due 2021 are collectively referred to as the "2021 Notes". Debt issuance costs associated with the new
borrowings were $10.1 million, which were recorded in other assets in the accompanying consolidated balance sheet and will
be amortized into interest expense over the life of the borrowings.