(8) Long-Term Debt:

The activity in our long-term debt from January 1, 2016 through September 30, 2016 is summarized as follows:




			Nine months ended September 30, 2016

($ in millions)	January 1, 2016		Payments and Retirements		New Borrowings		Debt Assumed		Reclassifications		September 30, 2016		Interest at September 30, 2016*

Senior and Subsidiary Unsecured Debt	$	16,055	$	(189)	$	171	$	500	$	(637)	$	15,900	9.18%
Senior Secured Debt		-		(87)		1,625		-		637		2,175	3.97%
Secured Subsidiary Debt		-		-		-		100		-		100	8.50%
Secured Debt		23		(4)		-		-		-		19	4.30%
Rural Utilities Service Loan Contracts		8		-		-		-		-		8	6.15%
Total Long-Term Debt	$	16,086	$	(280)	$	1,796	$	600	$	-	$	18,202	8.55%

Less: Debt Issuance Costs		(196)										(215)
Less: Debt Premium/(Discount)		2										(44)
Less: Current Portion		(384)										(509)
	$	15,508									$	17,434

* Interest rate includes amortization of debt issuance costs and debt premiums or discounts. The interest rates at September 30, 2016 represent a weighted average of multiple issuances.

Additional information regarding our senior unsecured debt, senior secured debt and subsidiary debt is as follows:



	September 30, 2016			December 31, 2015

	Principal		Interest	Principal		Interest
($ in millions)	Outstanding		Rate	Outstanding		Rate

Senior Unsecured Debt Due:
4/15/2017	$	440	8.250%	$	607	8.250%
10/1/2018		583	8.125%		583	8.125%
3/15/2019		434	7.125%		434	7.125%
4/15/2020		1,022	8.500%		1,022	8.500%
9/15/2020		1,000	8.875%		1,000	8.875%
7/1/2021		500	9.250%		500	9.250%
9/15/2021		775	6.250%		775	6.250%
4/15/2022		500	8.750%		500	8.750%
9/15/2022		2,171	10.500%		2,000	10.500%
1/15/2023		850	7.125%		850	7.125%
4/15/2024		750	7.625%		750	7.625%
1/15/2025		775	6.875%		775	6.875%
9/15/2025		3,600	11.000%		3,600	11.000%
11/1/2025		138	7.000%		138	7.000%
8/15/2026		2	6.800%		2	6.800%
1/15/2027		346	7.875%		346	7.875%
8/15/2031		945	9.000%		945	9.000%
10/1/2034		1	7.680%		1	7.680%
7/1/2035		125	7.450%		125	7.450%
10/1/2046		193	7.050%		193	7.050%
		15,150			15,146
Senior Secured Debt Due:
10/14/2016 *		302	5.875% (Variable)		344	2.805% (Variable)
10/24/2019 **		289	3.905% (Variable)		315	3.805% (Variable)
3/31/2021***		1,584	3.030% (Variable)		-	-
		2,175			659

Subsidiary Debt Due:
05/15/2027		200	6.750%		-	-
02/01/2028		300	6.860%		-	-
2/15/2028		200	6.730%		200	6.730%
10/15/2029		50	8.400%		50	8.400%
11/15/2031		100	8.500%		-	-
		850			250

Total	$	18,175	8.29% ****	$	16,055	8.74% ****

* Represents borrowings under the 2011 CoBank Credit Agreement, as defined below, that became secured as of April 1,

2016.

** Represents borrowings under the 2014 CoBank Credit Agreement, as defined below, that became secured as of April 1,

2016.

*** Represents borrowings under the 2015 Credit Agreement, as defined below.

**** Interest rate represents a weighted average of the stated interest rates of multiple issuances.

During the third quarter of 2016, we completed non-cash debt exchanges, including related accrued interest, of $167 million of our 8.25% Notes due April 2017 for approximately $171 million of our 10.5% Notes due September 2022. A pre-tax loss of approximately $7 million was recognized and included in “Investment and other income (loss), net” in our consolidated statements of operations.

In October 2016, we completed additional debt exchanges, including related accrued interest, of $84 million of our 8.25% Notes due April 2017 for approximately $66 million of our 8.875% Notes due September 2020 and $17 million of our 10.5% Notes due September 2022.

On August 12, 2015, Frontier entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto, for a $1,500 million senior secured delayed-draw term loan facility (the 2015 Credit Agreement). Frontier exercised its right under the 2015 Credit Agreement to obtain additional commitments and increased the size of the facility to $1,625 million. On April 1, 2016, in connection with the closing of the Verizon Acquisition, Frontier drew $1,550 million under that facility, with the additional $75 million drawn subsequently. The final maturity date is March 31, 2021. Repayment of the outstanding principal balance will be made in quarterly installments, initially in the amount of $20 million per installment, which commenced on June 30, 2016. The quarterly installments will increase to $41 million, beginning with the 13th quarterly installment. The remaining outstanding principal balance will be repaid on the final maturity date. Borrowings under the term loan will bear interest based on margins over the Base Rate (as defined in the 2015 Credit Agreement) or LIBOR, at the election of Frontier. Interest rate margins under the facility (ranging from 0.75% to 1.75% for Base Rate borrowings and 1.75% to 2.75% for LIBOR borrowings) are subject to adjustment based on Frontier’s Total Leverage Ratio (as defined in the 2015 Credit Agreement). Borrowings under the 2015 Credit Agreement are secured by a pledge of the stock of Frontier North Inc., a wholly owned subsidiary, primarily representing Frontier operations in the states of Illinois, Indiana, Michigan, Ohio and Wisconsin.

Upon completion of the Verizon Acquisition on April 1, 2016, we also assumed additional debt of $600 million, including $200 million aggregate principal amount of 6.75% Senior Notes due May 15, 2027, $300 million aggregate principal amount of 6.86% Senior Notes due February 1, 2028 and $100 million aggregate principal amount of 8.50% Senior Notes due November 15, 2031.

On September 25, 2015, Frontier completed a private offering of $6,600 million aggregate principal amount of unsecured Senior Notes, as follows: $1,000 million of 8.875% Senior Notes due 2020; $2,000 million of 10.500% Senior Notes due 2022; and $3,600 million of 11.000% Senior Notes due 2025. Each was issued at a price equal to 100% of its principal amount. Frontier used the net proceeds from the offering (after deducting underwriting fees) to finance a portion of the cash consideration paid in connection with the Verizon Acquisition and to pay related fees and expenses. In June 2016, we completed an exchange offer of registered senior notes for the privately placed senior notes.

On February 5, 2015, we entered into a commitment for a bridge loan facility (the Verizon Bridge Facility) and recognized related interest expense of $10 million and $184 million during the nine months ended September 30, 2016 and 2015, respectively. The accrued liabilities related to the Verizon Bridge Facility of $184 million were paid after the closing of the Verizon Acquisition and are included in “Other current liabilities” in the consolidated balance sheet as of December 31, 2015. The Verizon Bridge Facility terminated, in accordance with its terms, on September 25, 2015.

Frontier has two senior secured credit agreements with CoBank, ACB, as administrative agent, lead arranger and a lender, and the other lenders party thereto: the first, drawn in 2011 (the 2011 CoBank Credit Agreement), was refinanced in October 2016 with a similar facility for $315 million, maturing on October 12, 2021 (the 2016 CoBank Credit Agreement), and the second, drawn in 2014 (the 2014 CoBank Credit Agreement), matures on October 24, 2019. We refer to the 2011 CoBank Credit Agreement, the 2014 CoBank Credit Agreement and the 2016 CoBank Credit Agreement collectively as the CoBank Credit Agreements. Borrowings under the CoBank Credit Agreements are secured by a pledge of the stock of Frontier North, Inc.

Repayment of the outstanding principal balance for the 2016 CoBank Credit Agreement will be made in quarterly installments of approximately $8 million beginning December 31, 2016. The remaining outstanding principal balance will be repaid on the final maturity date. Borrowings under the term loan will bear interest based on margins over the Base Rate (as defined in the 2016 CoBank Credit Agreement) or LIBOR, at the election of Frontier. Interest rate margins under the facility (ranging from 0.875% to 2.875% for Base Rate borrowings and 1.875% to 3.875% for LIBOR borrowings) are subject to adjustment based on Frontier’s Total Leverage Ratio (as defined in the 2016 CoBank Credit Agreement). The term loan under the 2016 CoBank Credit Agreement is secured by a pledge of the stock of Frontier North Inc.

Frontier has a revolving credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, the lenders party thereto and the other parties named therein (the Revolving Credit Agreement), for a $750 million revolving credit facility (the Revolving Credit Facility) with a scheduled termination date of May 31, 2018. As of September 30, 2016, the Revolving Credit Facility was fully available and no borrowings had been made thereunder. The Revolving Credit Facility is available for general corporate purposes but may not be used to fund dividend payments. Any borrowings under the Revolving Credit Agreement will be secured by a pledge of the stock of Frontier North, Inc.

As of September 30, 2016, we were in compliance with all of our debt and credit facility covenants.

Our scheduled principal payments are as follows as of September 30, 2016:



	Principal
($ in millions)	Payments

2016 (remaining three months)	$	38
2017	$	509
2018	$	733
2019	$	818
2020	$	2,282
2021	$	2,541
Thereafter	$	11,281

As a result of the October debt exchanges and the 2016 CoBank Credit Agreement refinancing described above, we reclassified $354 million to “Long-term debt” that would otherwise have been classified as “Long-term debt due within one year.” The maturities of the new debt instruments are reflected in the above table as of September 30, 2016.