SHENANDOAH TELECOMMUNICATIONS COVA

Previous wording

On April 1, 2024 (the “Closing Date”), Shentel completed its previously announced acquisition of Horizon Acquisition Parent LLC, a Delaware limited liability company (“Horizon”), pursuant to the terms of an Agreement and Plan of Merger, dated October 24, 2023, by and among Shentel, Horizon, the sellers set forth on the signature pages thereto (each, a “Seller” and collectively, the “Sellers”) and the other parties thereto (as amended by the First Amendment to Agreement and Plan of Merger, dated April 1, 2024, the “Merger Agreement”). Subject to the terms and conditions of the Merger Agreement, on the Closing Date, Shentel acquired 100% of the outstanding equity interests of Horizon in exchange for (i) issuing 4,100,375 shares of Shentel’s common stock, no par value (“Common Stock”), to an investment fund managed by affiliates of GCM Grosvenor, which is one of the Sellers (the “Selling Shareholder”); and (ii) paying $305 million in cash consideration to the other Sellers and certain third parties, including Horizon’s existing lenders to discharge debt (collectively, the “Horizon Transaction”). Cash consideration paid also included purchase price adjustments for capital expenditure reimbursements and working capital subject to subsequent adjustments as defined in the merger agreement. Cash consideration paid remains subject to subsequent working capital and other adjustments. The Selling Shareholder agreed to an investor rights agreement with the Company that includes among other provision, a one year lockup period for the shares of Common Stock received.

Current wording

On April 1, 2024 (the “Closing Date”), Shentel completed its previously announced acquisition of Horizon Acquisition Parent LLC, a Delaware limited liability company (“Horizon”), pursuant to the terms of an Agreement and Plan of Merger, dated October 24, 2023, by and among Shentel, Horizon, the sellers set forth on the signature pages thereto (each, a “Seller” and collectively, the “Sellers”) and the other parties thereto (as amended by the First Amendment to Agreement and Plan of Merger, dated April 1, 2024, the “Merger Agreement”). Subject to the terms and conditions of the Merger Agreement, on the Closing Date, Shentel acquired 100% of the outstanding equity interests of Horizon in exchange for (i) issuing 4,100,375 shares of Shentel’s common stock, no par value (“Common Stock”), to an investment fund managed by affiliates of GCM Grosvenor, which is one of the Sellers (the “Selling Shareholder”); and (ii) paying $305 million in cash consideration to the other Sellers and certain third parties, including Horizon’s existing lenders to discharge debt (collectively, the “Horizon Transaction”). Cash consideration paid also included purchase price adjustments for capital expenditure reimbursements and working capital subject to subsequent adjustments as defined in the merger agreement. The Selling Shareholder agreed to an investor rights agreement with the Company that includes among other provision, a one year lockup period for the shares of Common Stock received.

Previous wording

Contemporaneously with the execution of the Merger Agreement, on October 24, 2023,, Shentel and Shentel Broadband Holding Inc., a wholly-owned subsidiary of Shentel (“Shentel Broadband”), entered into an investment agreement (the “Investment Agreement”) with ECP Fiber Holdings, LP, a Delaware limited partnership (“ECP Investor”), and, solely for the limited purposes set forth therein, Hill City Holdings, LP, a Delaware limited partnership affiliated with ECP Investor. Subject to the terms and conditions set forth in the Investment Agreement, on the Closing Date, Shentel Broadband issued to ECP Investor 81,000 shares of Shentel Broadband’s 7% Series A Participating Exchangeable Perpetual Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”), at a purchase price of $1,000 per share in exchange for $81 million in cash. The Series A Preferred Stock is exchangeable at the option of the Investor in certain circumstances for shares of Common Stock at an exchange price of $24.50 per share (as it may be adjusted pursuant to the terms of the Investment Agreement, the “Exchange Price”).

Current wording

Contemporaneously with the execution of the Merger Agreement, on October 24, 2023,, Shentel and Shentel Broadband Holding Inc., a wholly-owned subsidiary of Shentel (“Shentel Broadband”), entered into an investment agreement (the “Investment Agreement”) with ECP Fiber Holdings, LP, a Delaware limited partnership (“ECP Investor”), and, solely for the limited purposes set forth therein, Hill City Holdings, LP, a Delaware limited partnership affiliated with ECP Investor. Subject to the terms and conditions set forth in the Investment Agreement, on the Closing Date, Shentel Broadband issued to ECP Investor 81,000 shares of Shentel Broadband’s 7% Series A Participating Exchangeable Perpetual Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”), at a purchase price of $1,000 per share in exchange for $81 million in cash. The Series A Preferred Stock is exchangeable at the option of the Investor or Shentel in certain circumstances for shares of Common Stock at an exchange price of $24.50 per share (as it may be adjusted pursuant to the terms of the Investment Agreement, the “Exchange Price”).

Previous wording

Residential & SMB - Incumbent Broadband Markets revenue for the three months ended June 30, 2024 increased approximately $0.6 million, or 1.3%, compared with the three months ended June 30, 2023, primarily driven by $1.8 million of revenue from Horizon, partially offset by a 17.0% year-over-year decline in video RGUs.

Current wording

Residential & SMB - Incumbent Broadband Markets revenue for the three months ended September 30, 2024 increased approximately $0.5 million, or 1.3%, compared with the three months ended September 30, 2023, primarily driven by $1.8 million of revenue from Horizon, partially offset by a $1.3 million decline in the legacy Shentel markets due to lower video and other revenue.

Previous wording

Residential & SMB - Glo Fiber Expansion Markets revenue for the six months ended June 30, 2024 increased approximately $11.0 million, or 72.8%, compared with the six months ended June 30, 2023, primarily driven by $0.5 million of revenue from Horizon and 56.3% year-over-year growth in data RGUs driven by the Company’s expansion of Glo Fiber and a 9.2% increase in data ARPU.

Current wording

Residential & SMB - Glo Fiber Expansion Markets revenue for the three months ended September 30, 2024 increased approximately $5.8 million, or 61.9%, compared with the three months ended September 30, 2023, primarily driven by $0.5 million of revenue from Horizon, a 54% year-over-year growth in data revenue generated units (“RGUs”) and a 7% increase in data average revenue per unit (“ARPU").

Previous wording

Commercial Fiber revenue for the three months ended June 30, 2024 increased approximately $9.7 million, or 94.3%, compared with the three months ended June 30, 2023, primarily driven by $10.9 million of revenue from Horizon, partially offset by the expected decline in T-Mobile revenue from prior period backhaul circuit disconnects as part of the previously disclosed decommissioning of the former Sprint network.

Current wording

Commercial Fiber revenue for the three months ended September 30, 2024 increased approximately $9.8 million, or 94.5%, compared with the three months ended September 30, 2023, primarily driven by $11.3 million of revenue from Horizon, partially offset by a $1.4 million decline in T-Mobile revenue in the legacy Shentel markets from the previously disclosed backhaul circuit disconnects as part of the decommissioning of the former Sprint network.

Previous wording

Selling, general and administrative expense for the three months ended June 30, 2024, increased $5.2 million, or 20.8%, compared with the three months ended June 30, 2023, primarily driven by $4.1 million of recurring selling, general and administrative costs from Horizon, and $0.6 million primarily attributable to higher advertising and sales headcount to support the Glo Fiber expansion.

Current wording

Selling, general and administrative expense for the three months ended September 30, 2024, increased $5.1 million, or 22.0%, compared with the three months ended September 30, 2023, primarily driven by $3.7 million of selling, general and administrative costs from Horizon and higher advertising and sales headcount to support the Glo Fiber expansion.

Previous wording

Integration and amortization expense for the three months ended June 30, 2024, increased $11.0 million compared with the three months ended June 30, 2023, primarily driven by non-recurring acquisition-related costs related to the Horizon Transaction and integration of Horizon and Shentel’s operating activities.

Current wording

Integration and amortization expense for the three months ended September 30, 2024, increased $0.5 million compared with the three months ended September 30, 2023, primarily driven by non-recurring acquisition-related costs related to the Horizon Transaction and integration of Horizon and Shentel’s operating activities.

Previous wording

Depreciation and amortization increased $9.7 million, or 61.6%, compared with the three months ended June 30, 2023, primarily driven by $8.3 million of depreciation and amortization related to acquired tangible and intangible assets from Horizon and the Company’s expansion of its Glo Fiber network.

Current wording

Depreciation and amortization increased $11.6 million, or 71.7%, compared with the three months ended September 30, 2023, primarily driven by $8.3 million of depreciation and amortization related to acquired tangible and intangible assets from Horizon and the Company’s expansion of its Glo Fiber network.

Previous wording

Other expense, net was $4.4 million for the six months ended June 30, 2024 compared with other income, net of $1.3 million for the six months ended June 30, 2023, primarily driven by an increase in interest expense due to a higher outstanding debt balance during the six months ended June 30, 2024 compared to the six months ended June 30, 2023, partially offset by patronage income recorded as a result of patronage distributions received during the six months ended June 30, 2024.

Current wording

Other expense, net was $2.7 million for the three months ended September 30, 2024 compared with other income, net of $0.8 million for the three months ended September 30, 2023, primarily driven by an increase in interest expense due to a higher outstanding debt balance during the three months ended September 30, 2024 compared to the three months ended September 30, 2023.

Previous wording

The Company recognized $5.2 million of income tax benefit for the three months ended June 30, 2024, compared with $1.5 million of income tax expense for the three months ended June 30, 2023. The $6.7 million increase in income tax benefit was driven by higher pre-tax loss from continuing operations during the three months ended June 30, 2024.

Current wording

The Company recognized $1.5 million of income tax benefit for the three months ended September 30, 2024, compared with $0.4 million of income tax expense for the three months ended September 30, 2023. The $1.9 million increase in income tax benefit was driven by higher pre-tax loss from continuing operations during the three months ended September 30, 2024.

Previous wording

Residential & SMB - Glo Fiber Expansion Markets revenue for the three months ended June 30, 2024 increased approximately $5.9 million, or 72.6%, compared with the three months ended June 30, 2023, primarily driven by $0.5 million of revenue from Horizon and a 56.3% year-over-year growth in data RGUs driven by the Company’s expansion of Glo Fiber and a 8.8% increase in data ARPU.

Current wording

Residential & SMB - Glo Fiber Expansion Markets revenue for the nine months ended September 30, 2024 increased approximately $16.8 million, or 68.7%, compared with the nine months ended September 30, 2023, primarily driven by $1.0 million of revenue from Horizon, a 59% year-over-year growth in data RGUs driven by the Company’s expansion of Glo Fiber and a 8% increase in data ARPU.

Previous wording

Commercial Fiber revenue for the six months ended June 30, 2024 increased approximately $7.3 million, or 33.5%, compared with the six months ended June 30, 2023, primarily driven by $10.9 million of revenue from Horizon, partially offset by the expected decline in T-Mobile revenue from prior period backhaul circuit disconnects as part of the previously disclosed decommissioning of the former Sprint network.

Current wording

Commercial Fiber revenue for the nine months ended September 30, 2024 increased approximately $17.2 million, or 53.1%, compared with the nine months ended September 30, 2023, primarily driven by $22.2 million of revenue from Horizon, partially offset by a $5.0 million decline in T-Mobile revenue in the legacy Shentel markets from the previously disclosed backhaul circuit disconnects as part of the decommissioning of the former Sprint network.

Previous wording

Selling, general and administrative expense for the six months ended June 30, 2024, increased $7.1 million, or 14.0%, compared with the six months ended June 30, 2023, primarily driven by $4.1 million of recurring selling, general and administrative costs acquired from Horizon, higher advertising costs and sales headcount associated with the Company’s expansion of Glo Fiber.

Current wording

Selling, general and administrative expense for the nine months ended September 30, 2024, increased $12.2 million, or 16.5%, compared with the nine months ended September 30, 2023, primarily driven by $7.8 million of recurring selling, general and administrative costs acquired from Horizon and $4.4 million in higher expenses in the legacy Shentel markets due to higher advertising costs and sales headcount associated with the Company’s expansion of Glo Fiber and higher software maintenance expenses associated with system upgrades.

Previous wording

Integration and amortization expense for the three months ended June 30, 2024, increased $11.5 million compared with the three months ended June 30, 2023, primarily driven by non-recurring Horizon acquisition-related costs related to banking, legal, accounting, and other similar services and severance costs for employees who will not be retained permanently.

Current wording

Integration and amortization expense for the nine months ended September 30, 2024, increased $12.0 million compared with the nine months ended September 30, 2023, primarily driven by non-recurring Horizon acquisition-related costs related to banking, legal, accounting, severance and other similar expenses.

Previous wording

Depreciation and amortization increased $12.1 million, or 39.2%, compared with the six months ended June 30, 2023, primarily driven by $8.3 million of depreciation and amortization related to acquired tangible and intangible assets from Horizon and the Company’s expansion of its Glo Fiber network.

Current wording

Depreciation and amortization increased $23.7 million, or 50.3%, compared with the nine months ended September 30, 2023, primarily driven by $16.7 million of depreciation and amortization related to acquired tangible and intangible assets from Horizon and the Company’s expansion of its Glo Fiber network.

Previous wording

Other expense, net was $2.1 million for the three months ended June 30, 2024 compared with other income, net of $0.2 million for the three months ended June 30, 2023, primarily driven by an increase in interest expense due to a higher outstanding debt balance during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, partially offset by patronage income recorded as a result of patronage distributions received during the three months ended June 30, 2024.

Current wording

Other expense, net was $7.1 million for the nine months ended September 30, 2024 compared with other income, net of $2.1 million for the nine months ended September 30, 2023, primarily driven by an increase in interest expense due to a higher outstanding debt balance during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, partially offset by patronage income recorded as a result of patronage distributions received during the nine months ended September 30, 2024.

Previous wording

The Company recognized $6.2 million of income tax benefit for the six months ended June 30, 2024, compared with $2.1 million of income tax expense for the six months ended June 30, 2023. The $8.4 million increase in income tax benefit was driven by higher pre-tax loss from continuing operations during the six months ended June 30, 2024.

Current wording

The Company recognized $7.8 million of income tax benefit for the nine months ended September 30, 2024, compared with $2.5 million of income tax expense for the nine months ended September 30, 2023. The $10.3 million increase in income tax benefit was driven by higher pre-tax loss from continuing operations during the nine months ended September 30, 2024.

Previous wording

Shentel provides broadband internet, video and voice services to residential and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania, Kentucky, Delaware, Ohio and Indiana, via fiber optic and hybrid fiber coaxial cable networks. We also lease dark fiber and provide Ethernet and Wavelength fiber optic services to enterprise and wholesale customers throughout the entirety of our service area. Shentel’s Broadband business also provides voice and DSL telephone services as a Rural Local Exchange Carrier (“RLEC”) to customers in Shenandoah County and portions of adjacent counties in Virginia, and in Ross County and portions of adjacent counties in Ohio. These integrated networks are connected by over 16,000 route miles of fiber.

Current wording

Shentel provides broadband internet, video and voice services to residential and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania, Kentucky, Delaware, Ohio and Indiana, via fiber optic and hybrid fiber coaxial cable networks. We also lease dark fiber and provide Ethernet and Wavelength fiber optic services to enterprise and wholesale customers throughout the entirety of our service area. Shentel’s Broadband business also provides voice and DSL telephone services as a Rural Local Exchange Carrier (“RLEC”) to customers in Shenandoah County and portions of adjacent counties in Virginia, and in Ross County and portions of adjacent counties in Ohio. These integrated networks are connected by over 16,300 route miles of fiber.

Previous wording

Sources and Uses of Cash: The Company’s principal sources of liquidity are our cash and cash equivalents, cash generated from operations, and borrowings under our Credit Agreement, dated July 1, 2021 (as amended by (i) Amendment No. 1 to Credit Agreement, dated as of May 17, 2023, (ii) Consent and Amendment No. 2 to Credit Agreement, dated as of October 24, 2023, and Amendment No. 3, dated as of April 1, 2024, the “Credit Agreement”). The Credit Agreement contains (i) a $150 million, available revolving credit facility due June 2026 (the “Revolver”), (ii) a $150 million delayed draw amortizing term loan due June 2026 (“Term Loan A-1”), (iii) a $150 million delayed draw amortizing term loan due June 2028 (“Term Loan A-2”), and (iv) a $225 million delayed draw amortizing term loan due June 2028 (“Term Loan A-3” and collectively with Term Loan A-1 and Term Loan A-2, the “Term Loans”).

Current wording

Sources and Uses of Cash: The Company’s principal sources of liquidity are our cash and cash equivalents, cash generated from operations, government grants and borrowings under our Credit Agreement, dated July 1, 2021 (as amended by (i) Amendment No. 1 to Credit Agreement, dated as of May 17, 2023, (ii) Consent and Amendment No. 2 to Credit Agreement, dated as of October 24, 2023, and Amendment No. 3, dated as of April 1, 2024, the “Credit Agreement”). The Credit Agreement contains (i) a $150 million, available revolving credit facility due June 2026 (the “Revolver”), (ii) a $150 million delayed draw amortizing term loan due June 2026 (“Term Loan A-1”), (iii) a $150 million delayed draw amortizing term loan due June 2028 (“Term Loan A-2”), and (iv) a $225 million delayed draw amortizing term loan due June 2028 (“Term Loan A-3” and collectively with Term Loan A-1 and Term Loan A-2, the “Term Loans”).

Previous wording

In 2021, Congress passed the American Rescue Plan Act to subsidize the deployment of high-speed broadband internet access in unserved areas. We have been awarded approximately $86.3 million in grants to serve approximately 25,000 unserved homes in the states of Virginia, West Virginia and Maryland. The grants will be paid to the Company as certain milestones are completed. The Company expects to fulfill its obligations under these programs by 2026.

Current wording

In 2021, Congress passed the American Rescue Plan Act to subsidize the deployment of high-speed broadband internet access in unserved areas. We have been awarded approximately $86 million in grants to serve approximately 25,000 unserved homes in the states of Virginia, West Virginia and Maryland. The grants will be paid to the Company as certain milestones are completed. As of September 30, 2024, the Company received $13 million and had $73 million in grants available. The Company expects to fulfill the majority of its obligations under these programs by 2026.

Previous wording

Prior to the Horizon Transaction, Horizon entered into agreements with the Department of Development in Ohio under the state’s Ohio Residential Broadband Expansion program. As part of these agreements, Horizon committed to expand its broadband network resulting in total project costs of $57.4 million, with government matching grants totaling $30.1 million. Approximately $18.0 million of the grant was paid to Horizon up-front, while the remainder will be paid upon the achievement of specified milestones. Shentel assumed these agreements as a result of the Horizon Transaction and is therefore obligated under these programs to continue the build-out of this network. If Shentel fails to complete the build-out, Shentel may be required to repay a portion or all of the grant that Horizon received prior to the acquisition. Horizon was also granted $27.5 million by the National Telecommunications and Information Administration under its Middle Mile Grant Program.

Current wording

Prior to the Horizon Transaction, Horizon entered into agreements with the Department of Development in Ohio under the state’s Ohio Residential Broadband Expansion program. As part of these agreements, Horizon committed to expand its broadband network resulting in total project costs of $57.4 million, with government matching grants totaling $30.1 million. Approximately $18.0 million of the grant was paid to Horizon up-front, while the remainder will be paid upon the achievement of specified milestones. Shentel assumed these agreements as a result of the Horizon Transaction and is therefore obligated under these programs to continue the build-out of this network. If Shentel fails to complete the build-out, Shentel may be required to repay a portion or all of the grant that Horizon received prior to the acquisition. Horizon was also granted $27.5 million by the National Telecommunications and Information Administration under its Middle Mile Grant Program. As of September 30, 2024, the Company received $18 million and had $39 million available under both grants.

Previous wording

As of June 30, 2024, our cash and cash equivalents totaled $44 million and the availability under our Revolver and Term Loan A-3 was $368 million, for total available liquidity of approximately $412 million. As discussed in Note 1, Basis of Presentation and Other Informationin Part I, Item 1 of this quarterly report on Form 10-Q, Shentel entered into various agreements on April 1, 2024, which affected the Company’s liquidity. The Company utilized approximately$349 million to fund the Horizon Transaction, including payment of certain capital expenditures and payments for various transaction costs. Furthermore, the Company received$81 million in exchange for the issuance of Series A Preferred Stock. Finally, the Company amended its Credit Agreement, resulting in incremental delay draw term loan commitments under the Credit Agreement in an aggregate amount equal to $225 million and an increase in the revolving commitment under the Credit Agreement of $50 million.

Current wording

As of September 30, 2024, our cash and cash equivalents totaled $43 million, the availability under our Revolver and Term Loan A-3 was $318 million, and the remaining reimbursements available under government grants was $112 million, which are subject to fulfilling the terms of the agreements, for total available liquidity of approximately $473 million. As discussed in Note 1, Basis of Presentation and Other Informationin Part I, Item 1 of this quarterly report on Form 10-Q, Shentel entered into various agreements on April 1, 2024, which affected the Company’s liquidity. The Company utilized approximately$349 million to fund the Horizon Transaction, including payment of certain capital expenditures and payments for various transaction costs. Furthermore, the Company received$81 million in exchange for the issuance of Series A Preferred Stock. Finally, the Company amended its Credit Agreement, resulting in incremental delay draw term loan commitments under the Credit Agreement in an aggregate amount equal to $225 million and an increase in the revolving commitment under the Credit Agreement of $50 million.

Previous wording

As discussed above, Shentel sold its Tower Portfolio for$309.9 million in cash during thesix months ended June 30, 2024. The majority of these cash proceeds was used to fund Shentel’s purchase of Horizon Telcom on April 1, 2024.

Current wording

As discussed above, Shentel sold its Tower Portfolio for$309.9 million in cash during thenine months ended September 30, 2024. The majority of these cash proceeds was used to fund Shentel’s purchase of Horizon Telcom on April 1, 2024.

Previous wording

Net cash provided by operating activities from continuing operations was approximately $23.2 million during the six months ended June 30, 2024, representing a decrease of $40.3 million compared with the prior year period, primarily driven by lower current tax refunds received during the six months ended June 30, 2024 and changes in working capital.

Current wording

Net cash provided by operating activities from continuing operations was approximately $48.4 million during the nine months ended September 30, 2024, representing a decrease of $33.9 million compared with the prior year period, primarily driven by lower current tax refunds received during the nine months ended September 30, 2024 and changes in working capital.

Previous wording

Net cash used in investing activities from continuing operations was approximately $489.0 million during the six months ended June 30, 2024, representing an increase of $354.3 million compared with the prior year period, primarily driven by the payment of $349.4 million to acquire Horizon and to cover transaction costs related to the acquisition, a $15.7 million increase in capital expenditures driven by expansion of Glo Fiber and government-subsidized markets, partially offset by $7.7 million of grants received related to government funded infrastructure expansion programs.

Current wording

Net cash used in investing activities from continuing operations was approximately $560.9 million during the nine months ended September 30, 2024, representing an increase of $389.9 million compared with the prior year period, primarily driven by the payment of $349.4 million to acquire Horizon and to cover transaction costs related to the acquisition, a $37.1 million increase in capital expenditures driven by expansion of Glo Fiber and government-subsidized markets and a $17.3 million decrease in sales of assets, partially offset by $11.1 million of grants received related to government funded infrastructure expansion programs.

Previous wording

Net cash provided by financing activities from continuing operations was approximately $70.0 million during the six months ended June 30, 2024, representing an increase of $21.9 million compared with the prior year period, primarily driven by the issuance of $81 million in Shentel’s Series A Preferred Stock, partially offset by $50 million in lower borrowings against Shentel’s Credit Agreement, $4.1 million in higher cash outflows for debt amendment costs, $2.6 million in cash outflows for principal payments on outstanding debt and $1.6 million in cash outflows for financing costs related to the issuance of the Company’s Series A Preferred Stock.

Current wording

Net cash provided by financing activities from continuing operations was approximately $117.0 million during the nine months ended September 30, 2024, representing an increase of $44.3 million compared with the prior year period, primarily driven by the issuance of $79.4 million in Shentel’s Series A Preferred Stock, net of issuance costs, partially offset by $25 million in lower borrowings against Shentel’s Credit Agreement, $4.3 million in higher cash outflows for debt amendment costs, $4.8 million in cash outflows for principal payments on outstanding debt.

Previous wording

Indebtedness: To date, Shentel has borrowed $150 million under each of Term Loans A-1 and A-2 available under the Credit Agreement for a total of $300 million. As of June 30, 2024, the Company’s indebtedness totaled approximately $297.3 million, net of unamortized loan fees of $0.1 million. The borrowed amounts bear interest at a variable rate determined by one-month term SOFR, plus a margin based on net leverage. At June 30, 2024 Term Loan A-1 had a margin of 1.85% and Term Loan A-2 had a margin of 2.10%. The interest rate was 7.19% for Term Loan A-1 at June 30, 2024 and 7.44% for Term Loan A-2 at June 30, 2024.

Current wording

Indebtedness: To date, Shentel has borrowed $150 million under each of Term Loans A-1 and A-2; and $50 million under Term Loan A-3 available under the Credit Agreement for a total of $350 million. As of September 30, 2024, the Company’s indebtedness totaled approximately $344.6 million, net of unamortized loan fees of $0.6 million. The borrowed amounts bear interest at a variable rate determined by one-month term SOFR, plus a margin based on net leverage. The interest rate was 6.45% for Term Loan A-1, 6.70% for Term Loan A-2, and 6.95% for Term Loan A-3 at September 30, 2024.

Previous wording

Shentel’s Term Loans require quarterly principal repayments based on a percentage of the outstanding balance. Term Loan A-1 requires quarterly repayments of 0.63% from March 31, 2024 through June 30, 2024, then increasing to 1.25% quarterly from September 30, 2024 through March 31, 2026, with the remaining balance due June 30, 2026. Term Loan A-2 requires quarterly principal repayments of 0.25% from March 31, 2024 through March 31, 2028, with the remaining balance due June 30, 2028.

Current wording

Shentel’s Term Loans require quarterly principal repayments based on a percentage of the outstanding balance. Term Loan A-1 requires quarterly repayments of 1.25% quarterly from September 30, 2024 through March 31, 2026, with the remaining balance due July 1, 2026. Term Loan A-2 requires quarterly principal repayments of 0.25% from March 31, 2024 through March 31, 2028, with the remaining balance due July 1, 2028. Term Loan A-3 requires quarterly principal repayments of 0.25% from June 30, 2025 through March 31, 2027; then increasing to 1.25% quarterly from June 30, 2027 through March 31, 2028, with the remaining balance due July 1, 2028.

Previous wording

During the six months ended June 30, 2024, our capital expenditures of $150.9 million exceeded our net cash provided by operating activities of continuing operations by $127.7 million, and we expect our capital expenditures to exceed the cash flows provided from continuing operations through 2026, as we expand our Glo Fiber broadband network.

Current wording

During the nine months ended September 30, 2024, our capital expenditures of $226.5 million exceeded our net cash provided by operating activities of continuing operations by $178.1 million, and we expect our capital expenditures to exceed the cash flows provided from continuing operations through 2026, as we expand our Glo Fiber broadband network.