FairPoint Communications 2007 Annual Report Download - page 109

Table of Contents
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 
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Future minimum lease payments under non-cancelable operating leases as of December 31, 2007 are as follows (in thousands):
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Year ending December 31:
2008 $ 1,295
2009 1,045
2010 530
2011 582
2012 633
Thereafter 2,251
Total minimum lease payments $ 6,336
Total rent expense from continuing operations was $4.2 million, $3.8 million, and $3.5 million in 2007, 2006, and 2005,
respectively. All leases associated with discontinued operations were settled as of December 31, 2006.
The Company does not have any leases with contingent rental payments or any leases with contingency renewal, purchase options,
or escalation clauses.
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On June 6, 2005, a purported class action complaint was filed in the General Court of Justice, Superior Court Division, of the State
of North Carolina by Robert Lowinger on behalf of himself and all other similarly situated persons against the Company, the Company’s
Chairman and Chief Executive Officer, certain of the Company’s current and former directors and certain of the Company’s
stockholders. The complaint alleges violations of Sections 11 and 12(a)(2) and liability under Section 15 of the Securities Act of 1933,
and alleges that the Company’s registration statement on Form S-1 (which was declared effective by the Securities and Exchange
Commission, or SEC, on February 3, 2005) and the related prospectus dated February 3, 2005, each relating to the Company’s initial
public offering of common stock, contained certain material misstatements and omitted certain material information necessary to be
included relating to the Company’s broadband products and access line trends. The plaintiff, who has been a plaintiff in several prior
securities cases, seeks rescission rights and unspecified damages on behalf of a purported class of purchasers of the common stock
“issued pursuant and/or traceable to the Company’s IPO during the period from February 3, 2005 through March 21, 2005”. The
Company removed the action to Federal Court. The plaintiff filed a motion to remand the action to the North Carolina State Court, which
was denied by the Federal Magistrate. The plaintiff has objected to and appealed the Magistrate’s decision to the District Court Judge. The
Company has contested the appeal and filed a Motion to Dismiss the action. The Magistrate, on February 9, 2006, issued a
Memorandum and a Recommendation to the District Court Judge that the Motion to Dismiss be granted and that the complaint be
dismissed with prejudice. The plaintiff filed a Notice of Objection to the Magistrate’s Recommendation. On August 16, 2007, the United
States District Court for the Western District of North Carolina accepted the Magistrate’s recommendations as its own and dismissed the
complaint with prejudice.
From time to time, the Company is involved in other litigation and regulatory proceedings arising out of its operations. Management
believes that the Company is not currently a party to any legal proceedings, the adverse outcome of which, individually or in the
aggregate, would have a material adverse effect on the Company’s financial position or results of operations.
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