FairPoint Communications 2004 Annual Report Download - page 51


Credit Facility
Our credit facility consists of a credit agreement among the Company and certain financial institutions, with Deutsche Bank Trust
Company Americas, as administrative agent. The Company is the borrower under the credit facility and each of the Company's direct
subsidiaries is a guarantor of the Company's obligations.
The credit facility consists of:
•a revolving facility, or the revolver, in a total principal amount of up to $100.0 million; and
•a term loan facility, or the term loan, in a total principal amount of $588.5 million (including a $22.5 million delayed draw
facility).
The revolver has a swingline subfacility in an amount of $5.0 million and a letter of credit subfacility in an amount of $10.0 million,
which will allow issuances of standby letters of credit for our account. The credit facility also permits interest rate and currency exchange
swaps and similar arrangements that we may enter into with the lenders under the credit facility and/or their affiliates.
We expect to borrow under the revolver from time to time to provide for working capital and general corporate needs, including to finance
permitted acquisitions. The delayed draw facility was not drawn at the closing of the offering but may be drawn for a period of one year
following the closing of the offering to redeem or repurchase any 12 1/2% notes or 117/8% notes not purchased in the tender offers for such
notes, subject to the terms and conditions of the credit facility.
The term loan matures in February 2012 and the revolver matures in February 2011.
Features of the credit facility include:
 Borrowings bear interest, at our option, for the revolver and for the term loan at either (a) the Eurodollar rate
plus an applicable margin or (b) a base rate, as such term is defined in the credit agreement, plus an applicable margin.
The Eurodollar rate applicable margin and the base rate applicable margin for loans under our credit facility are 2.0% and 1.0%,
respectively. Interest on swing line loans bear interest at the base rate plus the base rate applicable margin. Interest with respect to base rate
loans is payable quarterly in arrears and interest with respect to Eurodollar loans is payable at the end of the applicable interest period and
every three months in the case of interest periods in excess of three months.
The credit facility provides for payment to the lenders of a commitment fee on any unused commitments equal to 0.5% per annum,
payable quarterly in arrears, as well as other fees.
We entered into three interest rate swap agreements which fixed the interest rate on approximately $130.0 million of the floating rate
borrowings under the term loan at 6.11% until December 31, 2009, fixed the interest rate on approximately $130.0 million of floating rate
borrowings under the term loan at 5.98% until December 31, 2008 and fixed the interest rate on approximately $130.0 million of the floating
rate borrowings under the term loan at 5.76% until December 31, 2007. The floating rate borrowings under our credit facility bear interest at
the Eurodollar rate plus 2.0%. These interest rate swap agreements effectively fixed the interest rate on 66% of our floating rate debt to a
blended interest rate of not more than 5.95% per annum until December 31, 2007.
 The credit facility requires us first to prepay outstanding term loans under the credit facility and, thereafter,
to repay loans under the new revolver and/or to reduce revolver commitments (or commitments under the delayed draw facility) under the
credit facility with, subject to certain conditions and exceptions, 100% of the net cash proceeds we receive from any sale, transfer or other
disposition of any assets, 100% of net casualty insurance proceeds and 100% of the
48