Frontier Communications 2013 Annual Report Download - page 103

Download and view the complete annual report

Please find page 103 of the 2013 Frontier Communications annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

Instrument Property
Fair
Value
Principal
Valuation
Technique
Significant
Unobservable
Inputs
Significant
Input
Values
Interest in
Limited
Partnerships Direct Capitalization Capitalization Rate 8.50%
and Limited
Liability
Corporations
100 Comm Drive, LLC $8,557 Discounted
Cash Flow
Discount Rate
Duration (years)
9.50%
10
Direct Capitalization Capitalization Rate 8.50%
100 CTE Drive, LLC $6,922 Discounted
Cash Flow
Discount Rate
Duration (years)
10.00%
15
Direct Capitalization Capitalization Rate 8.50%
6430 Oakbrook Parkway, LLC $24,955 Discounted
Cash Flow
Discount Rate
Duration (years)
10.50%
10
Direct Capitalization Capitalization Rate 8.50%
8001 West Jefferson, LLC $29,318 Discounted
Cash Flow
Discount Rate
Duration (years)
10.50%
10
1500 MacCorkle Ave SE, LLC $15,987 Direct Capitalization Capitalization Rate 8.85%
400 S. Pike Road West, LLC $1,079 Direct Capitalization Capitalization Rate 10.50%
601 N US 131, LLC $1,063 Direct Capitalization Capitalization Rate 10.00%
9260 E. Stockton Blvd., LLC $5,170 Direct Capitalization Capitalization Rate 9.00%
The fair value of our OPEB plan assets, which are all measured using Level 1 inputs, was $2.3 million and
$5.1 million as of December 31, 2013 and 2012, respectively.
The following table summarizes the carrying amounts and estimated fair values for long-term debt at
December 31, 2013 and 2012. For the other financial instruments including cash, accounts receivable, long-
term debt due within one year, accounts payable and other current liabilities, the carrying amounts approximate
fair value due to the relatively short maturities of those instruments. Other equity method investments, for
which market values are not readily available, are carried at cost, which approximates fair value.
($ in thousands)
Carrying
Amount Fair Value
Carrying
Amount Fair Value
2013 2012
Long-term debt ..................................... $7,873,667 $8,191,744 $8,381,947 $9,091,416
The fair value of our long-term debt is estimated based upon quoted market prices at the reporting date for
those financial instruments.
(19) Commitments and Contingencies:
We anticipate total capital expenditures for our current business operations of approximately $575 million
to $625 million for 2014, excluding the expenditure of funds previously received from the Connect America
Fund program. Although we from time to time make short-term purchasing commitments to vendors with
respect to these expenditures, we generally do not enter into firm, written contracts for such activities.
In connection with the pending AT&T Transaction, the Company currently expects to incur operating
expenses and capital expenditures of approximately $225 million to $275 million in 2014 related to these
acquisition and integration initiatives. The Company incurred $9.7 million of acquisition costs related to the
AT&T Transaction during the fourth quarter of 2013.
In connection with the 2010 Transaction, the Federal Communications Commission (FCC) and certain
state regulatory commissions, in connection with granting their approvals of the 2010 Transaction, specified
certain capital expenditure and operating requirements for the Acquired Territories for specified periods of time
post-closing. These requirements focus primarily on certain capital investment commitments to expand
broadband availability to at least 85% of the households throughout the Acquired Territories with minimum
F-41
FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements