Frontier Communications 2012 Annual Report Download - page 102

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included in determining the lease term. Future minimum rental commitments for all long-term noncancelable
operating leases as of December 31, 2012 are as follows:
($ in thousands)
Operating
Leases
Year ending December 31:
2013. . . ................................................ $ 95,323
2014. . . ................................................ 20,096
2015. . . ................................................ 10,319
2016. . . ................................................ 8,157
2017. . . ................................................ 6,528
Thereafter . . ................................................ 41,751
Total minimum lease payments ......................... $182,174
The Company has entered into an agreement to upgrade a significant portion of its existing vehicle fleet.
As of December 31, 2012, the Company has accepted delivery of 2,150 new vehicles and expects to accept
delivery of 1,614 additional new vehicles by March 31, 2013. The new vehicles expected to be leased under
this program will represent approximately 50% of our vehicle fleet. The minimum lease commitment for each
vehicle is 1 year and the leases are renewable at the Company’s option. The total annual lease expense for all
of the new vehicles is expected to be approximately $30.0 million on an annualized basis upon the acceptance
of the remaining vehicles.
Total rental expense included in our consolidated statements of operations for the years ended December 31,
2012, 2011 and 2010 was $79.3 million, $70.2 million and $48.5 million, respectively.
In our normal course of business we have obligations under certain non-cancelable arrangements for
services. During the third quarter of 2012, we entered into a take or pay arrangement for the purchase of future
long distance and carrier services. Our total remaining commitments under the arrangement are as follows:
($ in thousands)
Year Amount
2013 ........... $132,000
2014 ........... 141,800
2015 ........... 140,800
Total....... $414,600
As of December 31, 2012, we expect to utilize the services included within the arrangement and no
liability for the take or pay provision has been recorded.
We are a party to contracts with several unrelated long distance carriers. The contracts provide fees based
on traffic they carry for us subject to minimum monthly fees.
At December 31, 2012, the estimated future payments for obligations under our noncancelable long
distance contracts and service agreements are as follows:
($ in thousands)
Year Amount
2013. . . .......... $48,338
2014. . . .......... 21,357
2015. . . .......... 15,442
2016. . . .......... 4,593
2017. . . .......... 4,275
Thereafter........ 1,200
Total........ $95,205
F-41
FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements