Long-Term Debt and Revolving Promissory Note

Long-term debt, including unamortized discounts and premiums, and note payable-affiliate is as follows:



			Successor
	Interest Rates	Maturities	December 31, 2013			December 31, 2012
			(Dollars in millions)
Senior notes	6.125% - 8.375%	2014 - 2053	$	7,411		7,386
Capital lease and other obligations	Various	Various	72			112
Unamortized premiums, net			75			127
Total long-term debt			7,558			7,625
Less current maturities			(637		)	(804	)
Long-term debt, excluding current maturities			$	6,921		6,821
Note payable-affiliate	6.765%	2022	$	754		701

New Issuances

2013

On May 23, 2013, we issued $775 million aggregate principal amount of 6.125% Notes due 2053, including $25 million principal amount that was sold pursuant to an over-allotment option granted to the underwriters for the offering, in exchange for net proceeds, after deducting underwriting discounts and expenses, of approximately $752 million. The Notes are unsecured obligations and may be redeemed, in whole or in part, on or after June 1, 2018 at a redemption price equal to 100% of the principal amount redeemed plus accrued and unpaid interest to the redemption date.

2012

On June 25, 2012, we issued $400 million aggregate principal amount of 7.00% Notes due 2052 in exchange for net proceeds, after deducting underwriting discounts and expenses, of $387 million. The Notes are unsecured obligations and may be redeemed, in whole or in part, on or after July 1, 2017 at a redemption price equal to 100% of the principal amount redeemed plus accrued interest.

In connection with consummating the April 18, 2012 tender offer described below under "Repayments", we borrowed from a CenturyLink affiliate approximately $580 million under a revolving promissory note, payable upon demand. The promissory note is unsecured and ranked equally to our senior notes.

On April 2, 2012, we issued $525 million aggregate principal amount of 7.00% Notes due 2052 in exchange for net proceeds, after deducting underwriting discounts and expenses, of $508 million. The Notes are unsecured obligations and may be redeemed, in whole or in part, on or after April 1, 2017 at a redemption price equal to 100% of the principal amount redeemed plus accrued interest.

Repayments

2013

On June 17, 2013, we paid at maturity the $750 million principal amount of our floating rate Notes.

2012

On July 20, 2012, we redeemed all $484 million of our 7.50% Notes due 2023, which resulted in an immaterial loss.

On April 18, 2012, we completed a cash tender offer to purchase a portion of our $811 million of 8.375% Notes due 2016 and our $400 million of 7.625% Notes due 2015. With respect to our 8.375% Notes due 2016, we received and accepted tenders of approximately $575 million aggregate principal amount of these notes, or 71%, for $722 million including a premium, fees and accrued interest. With respect to our 7.625% Notes due 2015, we received and accepted tenders of approximately $308 million aggregate principal amount of these notes, or 77%, for $369 million including a premium, fees and accrued interest. The completion of this tender offer resulted in a loss of $46 million.

Aggregate Maturities of Long-Term Debt

Aggregate maturities of our long-term debt (excluding unamortized premiums, discounts, and other and excluding note payable-affiliate):



	(Dollars in millions)
2014	$	637
2015	122
2016	237
2017	500
2018	—
2019 and thereafter	5,987
Total long-term debt	$	7,483

Revolving Promissory Note

We have a revolving promissory note with an affiliate of CenturyLink that provides us with a funding commitment with an aggregate principle amount available to $1.0 billion through June 30, 2022, of which $754 million was outstanding as of the successor date of December 31, 2013. As of the successor date of December 31, 2013, the weighted average interest rate was 6.765%. This revolving promissory note and accrued interest thereon is reflected on our consolidated balance sheets as a current liability under “Note payable-affiliate”.

Interest Expense

Interest expense includes interest on long-term debt. The following table presents the amount of gross interest expense, net of capitalized interest and interest expense (income)-affiliates:



	Successor							Predecessor
	Year Ended December 31, 2013			Year Ended December 31, 2012		Nine Months Ended December 31, 2011		Three Months Ended March 31, 2011
	(Dollars in millions)
Interest expense:
Gross interest expense	$	467		461		305		153
Capitalized interest	(17		)	(18	)	(5	)	(3	)
Total interest expense	$	450		443		300		150
Interest expense (income)-affiliates	$	64		24		(1	)	—

Covenants

The indentures governing our notes contain certain covenants including, but not limited to: (i) a prohibition on certain liens on our assets; and (ii) a limitation on mergers or sales of all, or substantially all, of our assets, which limitation requires that a successor assume the obligation with regard to these notes. These indentures do not contain any cross-default provisions. As of the successor date of December 31, 2013, we believe we were in compliance with the provisions and covenants of our debt agreements.