Frontier Communications Receives Court Approval of All “First Day” Motions to Support Business Operations
April 16 2020 - 6:23PM
Business Wire
Continuing to Provide Uninterrupted Service to
Customers across the U.S.
Frontier Communications Corporation (NASDAQ: FTR) (“Frontier” or
the “Company”) today announced that it has received approvals on an
interim basis from the U.S. Bankruptcy Court for the Southern
District of New York for the “First Day” motions related to the
Company’s voluntary Chapter 11 petitions filed on April 14,
2020.
Among other things, the Court has authorized the Company to
continue paying employee wages and providing healthcare and other
benefits, as well as continue certain customer programs. As
previously announced, the Company has obtained commitments for $460
million in debtor-in-possession (“DIP”) financing. Subject to Court
approval, the Company’s liquidity will total over $1.1 billion
comprising the DIP financing and the Company’s more than $700
million cash on hand.
Robert Schriesheim, Chairman of the Finance Committee of the
Board of Directors, said, “We are pleased to have received approval
of our First Day motions, which will allow the business to continue
operating, providing important services to our customers without
interruption and maintaining our long-standing relationships with
our vendors and business partners. Our comprehensive restructuring
plan will result in a recapitalized balance sheet with a $10
billion reduction in our debt on an expedited basis, which will
substantially enhance our financial flexibility and facilitate our
ability to reposition Frontier and accelerate our broad-based
strategic transformation. We appreciate the prompt action by the
Court in approving our First Day motions.”
As previously announced, Frontier entered into a Restructuring
Support Agreement (“RSA”) with bondholders representing more than
75% of Frontier’s approximately $11 billion in outstanding
unsecured bonds (the “Bondholders”). The RSA contemplates
agreed-upon terms for a pre-arranged financial restructuring plan
(the “Plan”) that leaves unimpaired all general unsecured creditors
and holders of secured and subsidiary debt. Under the RSA, the
Bondholders have, subject to certain terms and conditions, agreed
to support implementation of a Plan that is expected to reduce the
Company’s debt by more than $10 billion and provide significant
financial flexibility to support continued investment in its
long-term growth.
Additional Information
Additional information regarding Frontiers’ financial
restructuring is available at www.frontierrestructuring.com. Court
filings and information about the claims process are available at
https://cases.primeclerk.com/ftr, by calling the Company’s claims
agent, Prime Clerk, toll-free at (877)-433-8020 or sending an email
to ftrinfo@primeclerk.com.
Kirkland & Ellis LLP is serving as legal advisor, Evercore
is serving as financial advisor and FTI Consulting, Inc. is serving
as restructuring advisor to the Company.
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a
variety of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure® digital
protection solutions.
Forward-Looking Statements
This press release contains “forward-looking statements” related
to future events. Forward-looking statements contain words such as
“expect,” “anticipate,” “could,” “should,” “intend,” “plan,”
“believe,” “seek,” “see,” “may,” “will,” “would,” or “target.”
Forward-looking statements are based on management’s current
expectations, beliefs, assumptions and estimates and may include,
for example, statements regarding the Chapter 11 cases, the DIP
financing, the Company’s ability to complete the financial
restructuring and its ability to continue operating in the ordinary
course while the Chapter 11 cases are pending. These statements are
subject to significant risks, uncertainties, and assumptions that
are difficult to predict and could cause actual results to differ
materially and adversely from those expressed or implied in the
forward-looking statements, including risks and uncertainties
regarding the Company’s ability to successfully complete a
reorganization process under Chapter 11, including: consummation of
the financial restructuring; potential adverse effects of the
Chapter 11 cases on the Company’s liquidity and results of
operations; the Company’s ability to obtain timely approval by the
bankruptcy court with respect to the motions filed in the Chapter
11 cases; objections to the Company’s financial restructuring, DIP
financing, or other pleadings filed that could protract the Chapter
11 cases; employee attrition and the Company’s ability to retain
senior management and other key personnel due to the distractions
and uncertainties; the Company’s ability to comply with the
restrictions imposed by the terms and conditions of the DIP
financing and other financing arrangements; the Company’s ability
to maintain relationships with suppliers, customers, employees and
other third parties and regulatory authorities as a result of the
Chapter 11 filing; the effects of the Chapter 11 cases on the
Company and on the interests of various constituents, including
holders of the Company’s common stock; the bankruptcy court’s
rulings in the Chapter 11 cases, the terms and conditions of the
financial restructuring and the DIP financing, and the outcome of
the Chapter 11 cases generally; the length of time that the Company
will operate under Chapter 11 protection and the continued
availability of operating capital during the pendency of the
Chapter 11 cases; risks associated with third party motions in the
Chapter 11 cases, which may interfere with the Company’s ability to
consummate the financial restructuring or an alternative
restructuring; increased administrative and legal costs related to
the Chapter 11 process; potential delays in the Chapter 11 process
due to the effects of the COVID-19 virus; and other litigation and
inherent risks involved in a bankruptcy process. Forward-looking
statements are also subject to the risk factors and cautionary
language described from time to time in the reports the Company
files with the U.S. Securities and Exchange Commission, including
those in the Company’s most recent Annual Report on Form 10-K and
any updates thereto in the Company’s Quarterly Reports on Form 10-Q
and Current Reports on Form 8-K. These risks and uncertainties may
cause actual future results to be materially different than those
expressed in such forward-looking statements. Frontier has no
obligation to update or revise these forward-looking statements and
does not undertake to do so.
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version on businesswire.com: https://www.businesswire.com/news/home/20200416005994/en/
Investors: Sheldon Bruha Executive Vice President and
Chief Financial Officer SB7874@ftr.com Luke Szymczak 203-614-5044
Vice President, Investor Relations luke.szymczak@ftr.com
Media: Javier Mendoza 562-305-2345 Vice President, Corporate
Communications and External Affairs javier.mendoza@ftr.com Meaghan
Repko / Jed Repko Joele Frank Wilkinson Brimmer Katcher
212-355-4449
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