Item 7.01 Regulation FD Disclosure
On October 4, 2021, Frontier Communications Holdings, LLC ("FCH LLC" or the
"Issuer"), a consolidated subsidiary of Frontier Communications Parent, Inc.
(the "Company"), commenced an offering pursuant to exemptions from the
registration requirements of the Securities Act of 1933, as amended (the
"Securities Act"), for the issuance of $1.0 billion aggregate principal amount
of second lien secured notes due 2030 (the "Offering"). On October 4, 2021, the
Company issued a press release regarding commencement of the Offering. A copy
of the press release is attached as Exhibit 99.1 to this Current Report on Form
8-K ("Current Report") and is incorporated by reference herein. The Company
intends to use the net proceeds of the Offering to fund capital investments and
operating costs arising from the Company's fiber build and expansion of its
fiber customer base, and for general corporate purposes.
In addition, FCH LLC has received requisite lender consents in connection with a
proposed amendment to its senior secured first lien revolving credit facility
(the "Exit Revolving Facility"), and expects to enter into such amendment
substantially concurrently with the closing of the Offering. Such amendment
will, among other things, change the financial covenant level to a maximum first
lien leverage ratio covenant (as more fully described in the Exit Revolving
Facility) of 3.00:1.00. There can be no assurances, however, that such amendment
to the Exit Revolving Facility will be executed and will become effective on the
terms as described herein or at all.
In connection with the Offering, the Company is furnishing its unaudited pro
forma condensed consolidated statements of operations (the "Pro Forma Financial
Information") and the explanatory notes thereto for the fiscal year ended
December 31, 2020 and for the six month periods ended June 30, 2021 and June 30,
2020, a copy of which is attached as Exhibit 99.2 to this Current Report and is
incorporated by reference herein. The Company became the successor reporting
company to Frontier Communications Corporation ("Old Frontier") upon Old
Frontier's emergence from bankruptcy on April 30, 2021 pursuant to Rule 15d-5 of
the Securities Exchange Act of 1934. The historical data provided for the year
ended December 31, 2020 is derived from Old Frontier's audited consolidated
financial statements contained in the Form 10-K filed for the year ended
December 31, 2020. The historical data provided for the period from January 1,
2021 through April 30, 2021 and for the period from May 1, 2021 through June 30,
2021 is derived from the Company's unaudited interim financial statements,
contained in the Form 10-Q filed for the quarterly period ended June 30, 2021.
The Pro Forma Financial Information (i) removes the results of the Northwest
Operations through the date of sale on May 1, 2020 from the Company's results of
operations for the year ended December 31, 2020, (ii) reverses certain
restructuring costs incurred during the six months ended June 30, 2021 and the
year ended December 31, 2020 and (iii) reflects the adoption of fresh start
accounting upon the Company's emergence from Chapter 11 restructuring on April
30, 2021 as if such adoption had occurred on January 1, 2020. Each of these
adjustments is described in further detail below and within the explanatory
notes to the Pro Forma Financial Information.
The Pro Forma Financial Information and explanatory notes should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations," and the consolidated financial statements and notes
included in our Annual Report on Form 10-K for the year ended December 31, 2020
and the Quarterly Report on Form 10-Q for the quarterly period ended June 30,
2021. The Pro Forma Financial Information is based upon available data and
certain estimates and assumptions that the Company believes are reasonable. The
Pro Forma Financial Information is presented for informational purposes only and
is not necessarily indicative of the results of operations that would have been
achieved had the transactions been completed at the dates indicated. In
addition, the Pro Forma Financial Information does not purport to project the
future results of operations of the Company.
The information being furnished under this Item 7.01, including Exhibit 99.1, of
this Current Report shall not be deemed to be "filed" for purposes of Section 18
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
otherwise subject to the liabilities of that section, nor shall it be deemed
incorporated by reference into any registration statement or other document
filed by the Company under the Securities Act of 1933, as amended, or the
Exchange Act, except as expressly set forth by specific reference in such
filing.
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Forward-Looking Statements
This Current Report contains "forward-looking statements" related to future
events. Forward-looking statements address our expectations or beliefs
concerning future events, including, without limitation, the transactions
contemplated hereto and the use of proceeds therefrom. These statements are made
on the basis of management's views and assumptions, as of the time the
statements are made, regarding future events and performance and contain words
such as "expect," "anticipate," "intend," "plan," "believe," "seek," "see,"
"may," "will," "would," or "target." Forward-looking statements by their nature
address matters that are, to different degrees, uncertain. A wide range of
factors could materially affect future developments and performance, including
but not limited to: our significant indebtedness, our ability to incur
substantially more debt in the future, and covenants in the agreements governing
our current indebtedness that may reduce our operating and financial
flexibility; our ability to successfully implement strategic initiatives,
including our fiber buildout and other initiatives to enhance revenue and
realize productivity improvements; competition from cable, wireless and wireline
carriers, satellite, fiber "overbuilders" and over the top companies, and the
risk that we will not respond on a timely or profitable basis; our ability to
successfully adjust to changes in the communications industry, including the
effects of technological changes and competition on our capital expenditures,
products and service offerings; risks related to disruption in our networks,
infrastructure and information technology that result in customer loss and/or
incurrence of additional expenses; the impact of potential information
technology or data security breaches or other cyber-attacks or other
disruptions; our ability to retain or attract new customers and to maintain
relationships with customers, including wholesale customers; our reliance on a
limited number of key supplies and vendors; declines in revenue from our voice
services, switched and nonswitched access and video and data services that we
cannot stabilize or offset with increases in revenue from other products and
services; our ability to secure, continue to use or renew intellectual property
and other licenses used in our business; our ability to hire or retain key
personnel; our ability to dispose of certain assets or asset groups or to make
acquisition of certain assets on terms that are attractive to us, or at all;
the effects of changes in the availability of federal and state universal
service funding or other subsidies to us and our competitors and our ability to
obtain future subsidies, including participation in the proposed RDOF program;
our ability to meet our CAF II and RDOF obligations and the risk of penalties or
obligations to return certain CAF II and RDOF funds; our ability to defend
against litigation and potentially unfavorable results from current pending and
future litigation; our ability to comply with applicable federal and state
consumer protection requirements; the effects of governmental legislation and
regulation on our business, including costs, disruptions, possible limitations
on operating flexibility and changes to the competitive landscape resulting from
such legislation or regulation; the impact of regulatory, investigative and
legal proceedings and legal compliance risks; our ability to effectively manage
service quality in the states in which we operate and meet mandated service
quality metrics; the effects of changes in income tax rates, tax laws,
regulations or rulings, or federal or state tax assessments; the effects of
changes in accounting policies or practices; our ability to successfully
renegotiate union contracts; the effects of increased medical expenses and
pension and postemployment expenses; changes in pension plan assumptions,
interest rates, discount rates, regulatory rules and/or the value of our pension
plan assets; the likelihood that our historical financial information may no
longer be indicative of our future performance and our implementation of fresh
start accounting; adverse changes in economic, political and market conditions
in the areas that we serve, the U.S. and globally; potential adverse impacts of
the COVID-19 pandemic on our business and operations, including potential
disruptions to the work of our employees arising from health and safety measures
such as social distancing and working remotely, our ability to effectively
manage increased demand on our network, our ability to maintain relationships
with our current or prospective customers and vendors as well as their abilities
to perform under current or proposed arrangements with us, and stress on our
supply chain; risks associated with our emergence from the Chapter 11 Cases,
including, but not limited to, the continuing effects of the Chapter 11 Cases on
us and our relationships with our suppliers, customers, service providers or
employees and changes in the composition of our board of directors and senior
management; volatility in the trading price of our common stock, which has a
limited trading history; substantial market overhang from the common stock
issued in the Chapter 11 reorganization; certain provisions of Delaware law and
our certificate of incorporation that may prevent efforts by our stockholders to
change the direction or management of our Company; and certain other factors set
forth in our other filings with the SEC. This list of factors that may affect
future performance and the accuracy of forward-looking statements is
illustrative and is not intended to be exhaustive. You should consider these
important factors, as well as the risks and other factors contained in
Frontier's filings with the U.S. Securities and Exchange Commission, including
our most recent reports on Form 10-K and Form 10-Q. These risks and
uncertainties may cause actual future results to be materially different than
those expressed in such forward-looking statements. We do not intend, nor do we
undertake any duty, to update any forward-looking statements.
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Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit
Number Description
99.1 Press Release
99.2 Pro Forma Financial Information
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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FRONTIER COMMUNICATIONS PARENT, INC. 
