Windstream 2014 Annual Report Download - page 130
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F-14
(b) Other (expense) income, net during 2013, primarily consisted of costs incurred in connection with the Holding Company
Formation.
(Loss) Gain on Extinguishment of Debt
During the third quarter of 2013, Windstream Corp. retired all $500.0 million of the outstanding 7.000 percent notes due March 15,
2019 (“2019 Notes”) using proceeds from the private placement of $500.0 million in aggregate principal amount of 7.750 percent
senior unsecured notes due October 1, 2021 (“2021 Notes”). During 2013 , Windstream Corp. also retired all $650.0 million of
the outstanding 8.875 percent PAETEC Notes due June 30, 2017 (“PAETEC 2017 Notes”). The PAETEC 2017 Notes were
repurchased using proceeds from the issuance of $700.0 million of 6.375 percent notes due August 1, 2023 (“2023 Notes”).
Windstream Corp. also amended its senior secured credit facility including issuance of Tranche B4, the proceeds of which were
used to repay Tranche A2, Tranche B and Tranche B2 during the first quarter of 2013. The retirements and a portion of the credit
facility amendment were accounted for under the extinguishment method of accounting, and, as a result, Windstream Corp.
recognized losses due to the extinguishment of the aforementioned debt obligations.
In 2012, Windstream Corp. retired all $300.0 million of the outstanding 9.500 percent notes due July 15, 2015 (“PAETEC 2015
Notes”). The PAETEC 2015 Notes were purchased using borrowings under the revolving line of credit. The retirement was
accounted for under the extinguishment method, and, as a result, Windstream Corp. recognized a gain on extinguishment of debt
of $1.9 million during 2012.
The (loss) gain on extinguishment of debt was as follows for the years ended December 31:
(Millions) 2013 2012
2019 Notes:
Premium on early redemption $(13.6)$ —
Third-party fees for early redemption (0.5)—
Unamortized debt issuance costs on original issuance (0.6)—
Loss on early extinguishment for 2019 Notes (14.7)—
Senior secured credit facility:
Unamortized debt issuance costs on original issuance (2.5)—
Loss on early extinguishment for senior secured credit facility (2.5)—
PAETEC 2017 Notes:
Premium on early redemption (51.5)—
Third-party fees for early redemption (1.0)—
Unamortized premium on original issuance 41.2 —
Loss on early extinguishment for PAETEC 2017 Notes (11.3)—
PAETEC 2015 Notes:
Premium on early redemption —(14.3)
Unamortized premium on original issuance —16.2
Gain on early extinguishment for PAETEC 2015 Notes —1.9
Total (loss) gain on early extinguishment of debt $ (28.5)$ 1.9