Frontier Communications 2005 Annual Report Download - page 69

F-20
CITIZENS COMMUNICATIONS COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the year ended December 31, 2005, we retired an aggregate $36,412,000 of debt (including $29,980,000 of
EPPICS conversions), representing approximately 1% of total debt outstanding at December 31, 2004. During the
second quarter of 2005, we entered into two debt-for-debt exchanges of our debt securities. As a result, $50,000,000
of our 7.625% Notes due 2008 were exchanged for approximately $52,171,000 of our 9.00% Notes due 2031. The
9.00% Notes are callable on the same general terms and conditions as the 7.625% Notes exchanged. No cash was
exchanged in these transactions, however a non-cash pre-tax loss of approximately $3,175,000 was recognized in
accordance with EITF No. 96-19, “Debtor’s Accounting for a Modification or Exchange of Debt Instruments” which
is included in other income (loss), net.
As of December 31, 2005, EPPICS representing a total principal amount of $177,971,000 had been converted
into 14,237,807 shares of our common stock.
Total future minimum cash payment commitments under ELI’s long-term capital leases including interest
amounted to $9,113,000 as of December 31, 2005.
The total outstanding principal amounts of industrial development revenue bonds were $58,140,000 at December
31, 2005 and 2004. The earliest maturity date for these bonds is in August 2015. Under the terms of our agreements
to sell our former gas and electric operations in Arizona, completed in 2003, we are obligated to call for redemption,
at their first available call dates, three Arizona industrial development revenue bond series aggregating to
approximately $33,440,000. These bonds’ first call dates are in 2007. We expect to retire all called bonds with cash.
In addition, holders of $11,150,000 principal amount of industrial development bonds may tender such bonds to us at
par and we have the simultaneous option to call such bonds at par on August 7, 2007. We expect to call the bonds
and retire them with cash.
As of December 31, 2005 we had available lines of credit with financial institutions in the aggregate amount of
$250,000,000 with a maturity date of October 29, 2009. Associated facility fees vary depending on our leverage ratio
and were 0.375% as of December 31, 2005. During the term of the credit facility we may borrow, repay and re-
borrow funds. The credit facility is available for general corporate purposes but may not be used to fund dividend
payments. There have never been any borrowings under the facility.
For the year ended December 31, 2004, we retired an aggregate $1,362,012,000 of debt (including $147,991,000
of EPPICS conversions), representing approximately 28% of total debt outstanding at December 31, 2003.
On January 15, 2004, we repaid at maturity the remaining outstanding $80,955,000 of our 7.45% Debentures.
On January 15, 2004, we redeemed at 101% the remaining outstanding $12,300,000 of our Hawaii Special
Purpose Revenue Bonds, Series 1993A and Series 1993B.
On May 17, 2004, we repaid at maturity the remaining outstanding $5,975,000 of ELI’s 6.05% Notes. These
Notes had been guaranteed by the Company.
On July 15, 2004, we renegotiated and prepaid with $4,954,000 of cash the entire remaining $5,524,000 ELI
capital lease obligation to a third party.
On July 30, 2004, we purchased $300,000,000 of the 6.75% notes that were a component of our equity units at
105.075% of par, plus accrued interest, at a premium of approximately $15,225,000 recorded in investment and other
income (loss), net.
During August and September 2004, we repurchased through a series of transactions an additional $108,230,000
of the 6.75% notes due 2006 at a weighted average price of 104.486% of par, plus accrued interest, at a premium of
approximately $4,855,000 recorded in investment and other income (loss), net.
On November 8, 2004, we issued an aggregate $700,000,000 principal amount of 6.25% senior notes due
January 15, 2013 through a registered underwritten public offering. Proceeds from the sale were used to redeem our
outstanding $700,000,000 of 8.50% Notes due 2006, which is discussed below.
On November 12, 2004, we called for redemption on December 13, 2004 the entire $700,000,000 of our 8.50%
Notes due 2006 at a price of 107.182% of the principal amount called, plus accrued interest, at a premium of
approximately $50,300,000.