Report created March 1, 2012

CUSIP: 362337AK3
is a subsidiary of FRONTIER COMMUNICATIONS CORPORATION. This section details the Moodys ratings for CUSIP 362337AK3.

Credit Rating Report

Currently there is no Moodys rating for CUSIP 362337AK3

FRONTIER COMMUNICATIONS CORPORATION

This section details the Moodys ratings for FRONTIER COMMUNICATIONS CORPORATION.

Credit Rating Report

Moody's Long-Term Rating
as of 09/18/2006

Ba2
09/18/2006

Watch Status FRONTIER COMMUNICATIONS CORPORATION

Upgrade Downgrade Uncertain Multiple Not on Watch

Long-Term Rating FRONTIER COMMUNICATIONS CORPORATION

Investment Grade Non-Investment Grade

Moody's uses Watch Status to indicate that a rating is under review for possible change in the short-term.

Issuers or issues rated Ba demonstrate below-average creditworthiness relative to other US municipal or tax-exempt issuers or issues.

Moody's Rating Outlook FRONTIER COMMUNICATIONS CORPORAT..

Positive Negative Stable Developing Under Review No Outlook

06/24/2010
Withdrawn

Key Indicators FRONTIER COMMUNICATIONS CORPORATION

12/31/2006 EBITDA Margin 56.8% Debt / EBITDA 4.0x FCF / Debt 5.1% RCF / Debt 11.0% (FFO + Interest Expense) / Interest Expense 3.4x (EBITDA - Capex) / Interest Expense 2.5x Standard adjustments in accordance with "Rating Methodology: Moody's Approach to Global Standard Adjustments in the Analysis of Financial Statements for Non-Financial Corporations, Part 1 (February 2006)." In addition, Moody's adjusts for one-time ite 12/31/2007 56.9% 3.7x 3.5% 11.0% 3.2x 2.5x 12/31/2008 55.3% 4.1x 2.6% 9.5% 3.0x 2.3x

A Moody's Rating Outlook is an opinion regarding the likely direction of a rating over the medium term.

Corporate Profile
Frontier Communications Company ("Frontier" or the "Company") is an Incumbent Local Exchange Carrier ("ILEC") headquartered in Stamford, CT. Following the Company's merger with a company spun out of Verizon Communications' northern and western operations (Spinco) in a reverse Morris Trust transaction, Frontier became the fifth largest wireline telecommunications company in the US, currently serving over 5 million access lines in primarily rural areas and small- and medium-sized cities.

Moody's Opinion: FRONTIER COMMUNICATIONS CORPORATION

Rating Drivers

as of 06/29/2011

Company's progress to significantly improve credit profile is tracking behind our expectations Substantial operating and integration risk weighs on the rating in near term Strong liquidity profile and management commitment to improve the Company's credit profile benefits the ratings SUMMARY RATING RATIONALE The Ba2 Corporate Family Rating largely reflects the integration risk and the turnaround challenge the Company continues to face in assuming the much larger Verizon operations as the downward pressure on wireline revenue and cash flow weighs on the ratings. At the same time, the ratings benefit from the predictability of the Company's cash flow generation and management's stated commitment to delever its balance sheet and drive credit metrics towards investment grade levels. Moody's also notes that Frontier continues to generate positive free cash flow, and adjusted debt to EBITDA leverage is expected to remain below 3.5x over the next year. DETAILED RATING CONSIDERATIONS SIGNIFICANT INTEGRATION RISK LOOMS FROM THE ACQUISITION OF SPINCO The challenge to Frontier of integrating a company more than twice its size is substantial and is the primary risk factor reflected in the Company's Ba2 CFR assignment. Although Frontier's estimated $250 million of integration costs are reasonable considering the size of the
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FRONTIER COMMUNICATIONS CORPORATION

DETAILED RATING CONSIDERATIONS ...continued from page 1

Credit Rating Report

acquired Verizon properties, the bigger complexities in telecom mergers usually involve information system conversions and billing migration. Moody's notes that the Company has successfully migrated the West Virginia operations onto its own IT platforms last year, and will follow a staged path to convert the remaining twelve states over the next 18 months. While the Company successfully navigated past the major risk of a failed operating systems transition, the Company's current cost structure still reflects a handful of redundant operations and systems. We recognize the merits of the proposed transaction, including reducing Debt/EBITDA leverage, and leverage has declined from a peak of 5.7x during 2010 (adjusted) to 4.0x. While the leverage metric is in the range for investment grade telecom issuers and the expected increase in free cash flow can drive further deleveraging or additional investment in new products and services, the near term uncertainty that the systems transition and integration will go smoothly is a major factor considered in the Ba2 rating. Frontier, similar to other rural operators, still dominates the high-margin business of providing local phone service in rural areas of the U.S., where competition is not as fierce as it is in urban markets. The increase in scale has bolstered Frontier's overall competitive position and increased operational and capital efficiencies, especially those related to network modernization and new product development. Frontier expects to generate significant expense savings from the merger, initially estimated at about $500 million annually. Non-recurring integration costs will likely be in the $250 million range, while the company will ramp up capital expenditures during the first couple of years of integration in order to increase Spinco properties' high speed data addressability. Frontier's current high speed data availability is approximately 92% in its service territories, while Spinco's high speed data coverage is available to about 60% of its territory. UPWARD RATING PRESSURE WOULD REQUIRE THE COMPANY TO DELIVER ON EBITDA MARGIN EXPANSION AND DELEVERAGING Frontier's credit profile remains within the Ba2 range, but the Company's progress in materially improving its credit metrics to be in line with investment grade ratings is tracking behind our expectations. Although Frontier is likely to achieve stated cost reduction targets, revenue losses in the acquired Verizon properties, particularly driven by greater than anticipated access line declines and pressure on ARPU weigh on the performance. In addition, since the close of the acquisition, the Spinco properties have seen greater attrition of their access lines relative to legacy Frontier operations, leading to a possibly longer period until Frontier is able to improve the operations to be in line with its historic markets. Moreover, we note that Frontier's recent pricing actions to churn off lower tier FIOS customers has strained revenues and churn. Moody's believes that it will take roughly one year for Frontier to see a significant improvement in the residential access line and revenue trends, as it will benefit from the network upgrades in the acquired markets, which Moody's expects to last into 2013. However, the turnaround on the commercial side is expected to bear fruit sooner, as management is devoting greater attention than in the past to that segment. As a result, the combined entity will need to deliver strong operating performance over the next two years to reach financial metrics that are consistent with the investment grade ratings the Company is targeting. We expect that, absent a turnaround in the revenue trendline, the Company should reach a run-rate EBITDA of approximately $2.5 billion on an adjusted basis, helped by an additional $200 million in cost savings by 2012. Frontier's adjusted EBITDA margins of 47% on an LTM basis at 3/31/2011, are well below the Company's historic mid 50% margins, indicating further room for margin expansion. Upward ratings pressure could result if the Company's margins expanded sustainably to historical levels, and the Company could meaningfully delever to below 3.0x. Liquidity We believe Frontier will have very good liquidity over the next twelve months, as we believe that the Company has sufficient cushion in its cash balances and enough discretion in capital expenditures to justify a strong liquidity outlook over the next 12 months. The key liquidity sources taken into consideration include: Frontier's $359 million in cash on hand; a $750 million revolving credit facility maturing in 2014; and expected positive free cash flows through the end of 2011. Moody's notes that free cash flow may be strained in 2012, if the company is unable to reverse the revenue declines in the acquired properties and possible increases in tax charges, but Moody's expects the Company to fund all future cash requirements from cash on hand or committed sources of liquidity. We expect the Company's $750 million revolver to remain undrawn. The facility has a 4.5x maintenance leverage covenant, which should provide ample cushion.

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FRONTIER COMMUNICATIONS CORPORATION

Structural Considerations

Credit Rating Report

The ratings for the debt instruments comprise both the overall probability of default of Frontier, to which Moody's assigns a PDR of Ba2, and an average family loss given default assessment of 50%. The Ba2 rating of the Company's senior unsecured debt reflects an LGD 4 (55%) loss given default assessment as the unsecured debt represents the vast majority of the Company's debt obligations. Rating Outlook The stable outlook reflects Moody's expectations that Frontier will be able to integrate the acquired properties of Spinco in a timely manner, and the Company's will achieve $500 million of targeted synergies before 2013. Moody's expects adjusted debt to EBITDA leverage to remain below 3.5x over the next year. What Could Change the Rating UP Positive rating momentum could develop if Frontier's financial profile strengthens driven by the success in integrating the acquired Verizon properties, evidenced by margin expansion and topline improvement. Moody's could upgrade Frontier's rating if the Company's leverage (total adjusted debt-to-EBITDA) could be sustained under 3.0x and its free cash flow increases to mid single digit percentage of its total debt. What Could Change the Rating DOWN Negative rating pressure could develop if Frontier's integration of the acquired properties adversely affects its operating performance, resulting in a weakened competitive position, evidenced by a rapid acceleration in access-line losses, or if the Company's liquidity becomes strained as a result of significant delays in realizing merger synergies. The rating could also come under pressure if persistent underperformance results in weakened credit metrics, such that leverage cannot be sustained under 3.5x (Moody's adjusted) and free cash flow deteriorates to the low single-digits range (relative to total debt). Other Considerations Unless stated otherwise, all cited metrics reflect the use of Moody's standard analytical adjustments and the projected financial metrics are based on Moody's expectations of the Company's financial performance. Frontier's Ba2 corporate family rating compares to the indicated rating of Ba1 under Moody's global telecom methodology based on our expectations of Frontier's financial and operating performance over the next two years. The difference is largely attributed to the significant execution risk associated with integrating the acquired Verizon properties. Copyright 2011 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ARE MOODY'S INVESTORS SERVICE, INC.'S ("MIS") CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MIS DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. CREDIT RATINGS DO NOT CONSTITUTE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS ARE NOT RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. CREDIT RATINGS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MIS ISSUES ITS CREDIT RATINGS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. All information contained herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided "AS IS" without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources Moody's considers to be reliable, including, when appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in every instance independently verify or
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Credit Rating Report

validate information received in the rating process. Under no circumstances shall MOODY'S have any liability to any person or entity for (a) any loss or damage in whole or in part caused by, resulting from, or relating to, any error (negligent or otherwise) or other circumstance or contingency within or outside the control of MOODY'S or any of its directors, officers, employees or agents in connection with the procurement, collection, compilation, analysis, interpretation, communication, publication or delivery of any such information, or (b) any direct, indirect, special, consequential, compensatory or incidental damages whatsoever (including without limitation, lost profits), even if MOODY'S is advised in advance of the possibility of such damages, resulting from the use of or inability to use, any such information. The ratings, financial reporting analysis, projections, and other observations, if any, constituting part of the information contained herein are, and must be construed solely as, statements of opinion and not statements of fact or recommendations to purchase, sell or hold any securities. Each user of the information contained herein must make its own study and evaluation of each security it may consider purchasing, holding or selling. NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR MANNER WHATSOEVER. MIS, a wholly-owned credit rating agency subsidiary of Moody's Corporation ("MCO"), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MIS have, prior to assignment of any rating, agreed to pay to MIS for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS's ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading "Shareholder Relations - Corporate Governance - Director and Shareholder Affiliation Policy." Any publication into Australia of this document is by MOODY'S affiliate, Moody's Investors Service Pty Limited ABN 61 003 399 657, which holds Australian Financial Services License no. 336969. This document is intended to be provided only to "wholesale clients" within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY'S that you are, or are accessing the document as a representative of, a "wholesale client" and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to "retail clients" within the meaning of section 761G of the Corporations Act 2001. Notwithstanding the foregoing, credit ratings assigned on and after October 1, 2010 by Moody's Japan K.K. ("MJKK") are MJKK's current opinions of the relative future credit risk of entities, credit commitments, or debt or debt-like securities. In such a case, "MIS" in the foregoing statements shall be deemed to be replaced with "MJKK". MJKK is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly owned by Moody's Overseas Holdings Inc., a wholly-owned subsidiary of MCO. This credit rating is an opinion as to the creditworthiness or a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be dangerous for retail investors to make any investment decision based on this credit rating. If in doubt you should contact your financial or other professional adviser.

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Rating Definitions
Long-Term Obligation Ratings
Moodys long-term obligation ratings are opinions of the relative credit risk of fixed-income obligations with an original maturity of one year or more. They address the possibility that a financial obligation will not be honored as promised. Such ratings reflect both the likelihood of default and any financial loss suffered in the event of default. Aaa Aa A Baa Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk. Obligations rated Aa are judged to be of high quality and are subject to very low credit risk. Obligations rated A are considered upper-medium grade and are subject to low credit risk. Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics. Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk. Obligations rated B are considered speculative and are subject to high credit risk. Obligations rated Caa are judged to be of poor standing and are subject to very high credit risk. Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest. Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest.

Rating Outlooks
A Moodys rating outlook is an opinion regarding the likely direction of a rating over the medium term. Where assigned, rating outlooks fall into the following four categories: Positive (POS), Negative (NEG), Stable (STA), and Developing (DEV -contingent upon an event). In the few instances where an issuer has multiple outlooks of differing directions, an (m) modifier (indicating multiple, differing outlooks) will be displayed, and Moodys written research will describe any differences and provide the rationale for these differences. A RUR (Rating(s) Under Review) designation indicates that the issuer has one or more ratings under review for possible change, and thus overrides the outlook designation. When an outlook has not been assigned to an eligible entity, NOO (No Outlook) may be displayed.

Watchlist
Moodys uses the Watchlist to indicate that a rating is under review for possible change in the short-term. A rating can be placed on review for possible upgrade (UPG), on review for possible downgrade (DNG), or more rarely with direction uncertain (UNC). A credit is removed from the Watchlist when the rating is upgraded, downgraded or confirmed.

Ba B Caa Ca C

Provisional Ratings
As a service to the market and typically at the request of an issuer, Moody's will assign a provisional rating when it is highly likely that the rating will become final after all documents are received, or an obligation is issued into the market. A provisional rating is denoted by placing a (P) in front of the rating. Such ratings may also be assigned to shelf registrations under SEC rule 415.

Note: Moodys appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.

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Important Information about this Report

Copyright 2012, Moody's Investors Service, Inc. and/or its licensors including Moody's Assurance Company, Inc. (together, MOODY'S). All rights reserved. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY COPYRIGHT LAW AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT.

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