| 2017-09-26 08:33:07|
WIN, UNIT 08:33 09/26 09/26/17
Windstream says allegations in purported notice of default 'without merit'
In a regulatory filing last night, Windstream (WIN) disclosed that the company received a purported notice of default dated September 21 from a noteholder that claims to hold greater than 25% in aggregate principal amount of the company's 6 3/8% Senior Notes due 2023 issued under the indenture dated January 23, 2013 between the company, as issuer, Windstream Finance Corp., as co-issuer, the guarantors party thereto and U.S. Bank National Association, as trustee. The filing stated: "The Notice alleges that the transfer of certain assets and the subsequent lease of those assets in connection with the spinoff of Communications Sales & Leasing, Inc. (now known as Uniti Group, Inc.) in April 2015 constituted a Sale and Leaseback Transaction which did not comply with the Sale and Leaseback covenant under the Indenture. The transactions did not constitute a Sale and Leaseback Transaction, and the Company asserts no default occurred, and that no default is continuing, under the Sale and Leaseback covenant under the Indenture. The Notice further alleges that the Company violated the restricted payment covenant under the Indenture by not delivering an officers' certificate as required by the Indenture and that it made a restricted payment in reliance on the restricted payment builder basket during the pendency of an alleged default which is prohibited by the Indenture. The Company delivered the requisite officers' certificate and was not in default when it made any restricted payments. The allegations in the Notice are without merit, and the Company believes those allegations are intended to manipulate the prices of the Notes and other securities. The Company is in compliance with all of the covenants under the Indenture. The Company will vigorously defend against these allegations and pursue all appropriate remedies, including, but not limited to, action(s) against any party alleging default."