Frontier Communications closes $315 million senior secured term loan

By Marisa Wong

Morgantown, W.Va., Oct. 12 – Frontier Communications Corp. entered into a $315 million senior secured term loan credit agreement on Wednesday with CoBank, ACB as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The term loan matures on Oct. 12, 2021.

Repayment of the outstanding principal balance will be made in quarterly installments of $7,875,000, the first of which will be on Dec. 31. The remaining outstanding principal balance will be repaid at maturity.

Borrowings will bear interest at Libor plus a margin of 187.5 basis points to 387.5 bps, depending on Frontier’s total leverage ratio.

The loan will be secured by a pledge of wholly owned subsidiary Frontier North Inc.’s stock.

In addition to restrictive covenants, the credit agreement includes a financial covenant requiring compliance with a leverage ratio.

Loan proceeds have been used to repay Frontier’s existing senior secured term loan dated Oct. 14, 2011 and for general corporate purposes.

The telecommunications company is based in Norwalk, Conn.

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