Tender Offers Increased to Maximum of $2.86 Billion Aggregate Face Amount of Debt at Maturity
Level 3 Communications, Inc. (Nasdaq:LVLT) today announced that Level 3 Finance, LLC ("Level 3 Finance"), its first tier, wholly owned subsidiary, has amended the "Modified Dutch Auction" tender offers for a portion of Level 3 Communications, Inc.'s ("Level 3") senior debt and convertible debt securities, which were commenced on September 10, 2001.
Level 3 Finance has amended its tender offers to provide that it is now offering to purchase for cash, at prices determined by a "Modified Dutch Auction" procedure within the amended purchase price ranges set forth in the table below, the following amended principal amount or principal amount at maturity of Level 3's 9% Senior Notes due 2008, 10% Senior Discount Notes due 2008, 10% Senior Notes due 2008, 11% Senior Notes due 2010, 11% Senior Notes due 2008, 11% Senior Notes due 2010, 12% Senior Discount Notes due 2010, 6% Convertible Subordinated Notes due 2009 and 6% Convertible Subordinated Notes due 2010.
A separate offer is being made with respect to each series of Notes.
| Series of Notes | Maximum Principal Amount or Principal Amount at Maturity Sought | Maximum Amount Sought as Percentage of Outstanding as of 08/31/01 | Purchase Price Rangeper $1,000 (or ?1,000) Principal Amount |
| 9 1/8% Notes | up to $725 million | 36% | $350 to $450 |
| 10 1/2% Discount Notes* | up to $125 million | 15% | $210 to $250 |
| 10 3/4% Euro Notes | up to 300 million | 60% | 370 to 440 |
| 11 1/4% Euro Notes | up to 200 million | 67% | 370 to 440 |
| 11% Notes | up to $450 million | 56% | $380 to $480 |
| 11 1/4% Notes | up to $150 million | 60% | $370 to $460 |
| 12 7/8% Discount Notes* | up to $100 million | 15% | $150 to $180 |
| 2009 Convertible Notes | up to $525 million | 76% | $190 to $220 |
| 2010 Convertible Notes | up to $325 million | 39% | $190 to $220 |
| * Principal amount at maturity | |||
The funds required for Level 3 Finance to consummate the tender offers have been contributed to Level 3 Finance by Level 3 from its available cash.
The purchase price ranges listed above are per $1,000 (or 1,000 in the case of the Euro Notes) principal amount or principal amount at maturity in the case of the Discount Notes. The revised maximum aggregate principal amount (or principal amount at maturity, as applicable) listed above for a series of Notes is referred to as the "Offer Amount" for that series.
Under the "Modified Dutch Auction" procedure, Level 3 Finance will accept tendered Notes in each offer in the order of the lowest to the highest tender prices specified by tendering holders within the applicable revised price range for the applicable series of Notes, and will select the single lowest price so specified (with respect to such series, the "Purchase Price") that will enable Level 3 Finance to purchase the Offer Amount for that series (or, if less than the Offer Amount for that series are tendered, all Notes of that series so tendered). Level 3 Finance will pay the same Purchase Price for all Notes of a given series that are tendered at or below the Purchase Price for that series, upon the terms and subject to the conditions of the applicable offer, including the proration terms for that offer.
Level 3 has extended the expiration date of the tender offer for each series of Notes until 11:59 p.m., New York City time, on October 22, 2001, unless that offer is further extended. Tendered Notes may be withdrawn at any time prior to the applicable expiration date. As of the close of business on October 8, 2001, the following principal amounts (or principal amounts at maturity, as applicable) of Notes have been validly tendered:
| Series of Notes | Principal Amount or Principal Amount at Maturity Validly Tendered | ||
| 9 1/8% Notes | $241,115,000 | ||
| 10 1/2% Discount Notes* | $273,236,000 | ||
| 10 3/4% Euro Notes | 21,430,000 | ||
| 11 1/4% Euro Notes | 2,112,000 | ||
| 11% Notes | $141,634,000 | ||
| 11 1/4% Notes | $50,592,000 | ||
| 12 7/8% Discount Notes* | $109,803,000 | ||
| 2009 Convertible Notes | $85,485,000 | ||
| 2010 Convertible Notes | $58,739,000 | ||
| * Principal amount at maturity | |||
In the event that the amount of any series of Notes, other than the 2009 Convertible Notes and the 2010 Convertible Notes, tendered on or prior to the expiration date for that offer at or below the applicable Purchase Price exceeds the Offer Amount for that series then, subject to the terms and conditions of the applicable offer, Level 3 Finance will accept for payment such Notes of that series as follows. First, Level 3 Finance will accept for payment all Notes of that series that are tendered at prices below the applicable Purchase Price. Next, Level 3 Finance will accept for payment such Notes of that series that are tendered at the applicable Purchase Price on a pro rata basis from among the tendered Notes of that series.
In the event that the amount of either series of Convertible Notes validly tendered (and not withdrawn) prior to the applicable expiration date at or below the applicable Purchase Price exceeds the Offer Amount for that series of Convertible Notes then, under and subject to the amended terms and conditions of the applicable Convertible Note offer, Purchaser will accept for payment such Convertible Notes of that series that are validly tendered (and not withdrawn) at or below the applicable Purchase Price on a pro rata basis from among such tendered Convertible Notes of that series.
The terms and conditions of each offer are set forth in Level 3 Finance's Offer to Purchase, dated September 10, 2001, as supplemented on September 25, 2001, and as further supplemented on October 9, 2001. Subject to applicable law, Level 3 Finance may, in its sole discretion, waive any condition applicable to any tender offer or extend or terminate or otherwise amend any offer.
No offer is conditioned on the consummation of any other offer, and no offer has as a condition that a minimum principal amount (or principal amount at maturity, as applicable) of Notes be tendered in that offer. The consummation of the tender offer for each series of Notes remains subject to certain conditions, which are described in the Offer to Purchase.
This announcement is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell securities, with respect to any series of Notes. The tender offers may only be made pursuant to the terms of the Offer to Purchase and the accompanying Letter of Transmittal, in each case as supplemented.
Salomon Smith Barney and J.P. Morgan Securities Inc. are acting as dealer managers and Mellon Investor Services LLC is both the information agent and the depositary in connection with the tender offers. Copies of the Offer to Purchase, Letter of Transmittal and related documents may be obtained from the information agent at Mellon Investor Services LLC, 44 Wall Street, 7th Floor, New York, New York 10005, at (917) 320-6286 (banks and brokers) or (888) 788-1979 (toll free). Additional information concerning the terms of the tender offers, including all questions relating to the mechanics of the offers, may be obtained by contacting Salomon Smith Barney at (800) 558-3745 (toll-free) or (212) 723-6106 (call collect) or J.P. Morgan Securities Inc. at (800) 245-8812 (toll-free) or (212) 270-1100 (call collect).
About Level 3 Communications
Level 3 Communications, Inc. (NASDAQ: LVLT), an international communications company, operates one of the largest Internet backbones in the world, connecting 180 markets in 18 countries. The company serves a broad range of wholesale, enterprise and content customers with a comprehensive suite of services including: Internet Protocol (IP) services, broadband transport and infrastructure services, colocation services, voice and voice over IP services, content delivery and media distribution services. These services provide the building blocks to enable Level 3’s customers to meet their growing demands for advanced communications solutions. The company’s Web address is www.Level3.com.
"Level 3 Communications,” "Level 3," the red 3D brackets and the Level 3 Communications logo are registered service marks of Level 3 Communications, LLC in the United States and/or other countries. Level 3 services are provided by wholly owned subsidiaries of Level 3 Communications, Inc. Any other service, product or company names recited herein may be trademarks or service marks of their respective owners.
Forward-Looking Statement
Some of the statements that we make in this press release are forward looking in nature. These statements are based on management’s current expectations or beliefs. These forward looking statements are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside our control, which could cause actual events to differ materially from those expressed or implied by the statements. The most important factors that could prevent us from achieving our stated goals include, but are not limited to our ability to: successfully integrate acquisitions; increase the volume of traffic on our network; defend our intellectual property and proprietary rights; develop new products and services that meet customer demands and generate acceptable margins; successfully complete commercial testing of new technology and information systems to support new products and services; attract and retain qualified management and other personnel; and meet all of the terms and conditions of our debt obligations. Additional information concerning these and other important factors can be found within Level 3’s filings with the Securities and Exchange Commission. Statements in this press release should be evaluated in light of these important factors. Level 3 is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.
