Level 3 Financing Increases the Size of its Proposed Senior
Secured Term Loan to $730 Million
BROOMFIELD, Colo., November 17, 2004 – Level 3 Communications, Inc. (Nasdaq:LVLT) announced today that, it has increased to $1.105 billion (the “Tender Cap”) the maximum aggregate principal amount of its outstanding debt securities due 2008 specified in the table below (the “Notes”) that it could be obligated to accept for payment in its pending cash tender offers (the “Offers”). The “Maximum Offer Amount” Level 3 is offering to purchase for each series of Notes, and the “Acceptance Priority Levels” for each series, remain unchanged and are listed in the table below. The terms and conditions of the Offers are set forth in Level 3’s Offer to Purchase dated October 29, 2004 and a Supplement to the Offer to Purchase dated November 17, 2004 (together, the “Offer to Purchase”) and the related Letter of Transmittal.
In connection with this increase in the Tender Cap, Level 3 has extended the expiration of each Offer to 12:00 midnight, New York City time, on December 1, 2004, unless extended (the “Expiration Date”). Holders of Notes of any series that were validly tendered prior to 5:00 p.m., New York City time on November 12, 2004 (the “Early Tender Date”) will receive the “Total Consideration” for that series shown in the table below, consisting of the applicable “Tender Offer Consideration” for that series and the “Early Tender Payment” for that series, each as shown in the table below, if such Notes are accepted for purchase. Holders of Notes of any series who validly tender after the Early Tender Date and whose Notes are accepted for purchase will receive the applicable Tender Offer Consideration for that series but will not receive the Early Tender Payment. Accrued interest up to, but not including, the applicable settlement date will be paid in cash on all validly tendered and accepted Notes.
| Title of Security |
Acceptance |
Principal Amount |
Maximum Offer Amount |
Principal Amount Tendered as of Early Tender Date |
| 9⅛% Senior Notes due 2008 |
1 |
$1,203,652,000 |
$450,000,000 |
$243,955,000 |
| 11% Senior Notes due 2008 |
2 |
$362,036,000 |
$362,036,000 |
$229,226,000 |
| 10½% Senior Discount Notes due 2008 ** |
3 |
$409,462,000 |
$409,462,000 |
$262,515,000 |
| 10¾% Senior Euro Notes due 2008 |
4 |
€320,826,000 |
€320,826,000 |
€284,461,000 |
| Title of Security |
Principal Amount Tendered as of November 15, 2004 |
Tender |
Early Tender Payment* |
Total Consideration* |
| 9⅛% Senior Notes due 2008 |
$244,862,000 |
$837.50 |
$20.00 |
$857.50 |
| 11% Senior Notes due 2008 |
$229,226,000 |
$867.50 |
$20.00 |
$887.50 |
| 10½% Senior Discount Notes due 2008 ** |
$264,215,000 |
$837.50 |
$20.00 |
$857.50 |
| 10¾% Senior Euro Notes due 2008 |
€284,461,000 |
€830.00 |
€20.00 |
€850.00 |
* Per $1,000 or €1,000 principal amount of notes accepted for purchase, as applicable.
** Principal amount outstanding represents principal amount at maturity.
Notes tendered pursuant to the Offers prior to 5:00 p.m., New York City time, on the Early Tender Date may no longer be withdrawn. Notes tendered pursuant to the Offers after 5:00 p.m., New York City time, on the Early Tender Date may be withdrawn until 12:00 midnight on the Expiration Date.
Consistent with amending the Tender Cap, we have amended the financing condition of the Offers to provide that our obligation to accept for purchase Notes pursuant to the Offers is subject to (1) the receipt by our subsidiary, Level 3 Financing, Inc., of borrowings of at least $730 million under a proposed new senior secured term loan, into which it is seeking to enter, and (2) our receipt of gross proceeds of at least $320 million from our issuance of new convertible senior notes in a private placement . The Offers are subject to the satisfaction or waiver of certain other conditions. In connection with amending the Tender Cap, Level 3 Financing has increased the size of its proposed new senior secured term loan to $730 million.
As described in the Offer to Purchase, Level 3 will have no obligation to accept for purchase or to pay for Notes tendered pursuant to the Offers in an aggregate principal amount in excess of the Tender Cap of $1.105 billion. To the extent that one or more of the Offers are oversubscribed, validly tendered Notes in each series will be accepted for payment in accordance with each series’ Maximum Offer Amount and Acceptance Priority Level. For instance, Notes in the Offer with the first Acceptance Priority Level will be accepted up to the Maximum Offer Amount for that series before Notes in the Offer with the second Acceptance Priority Level (subject to the amount of Tender Cap remaining available). If the aggregate principal amount or principal amount at maturity of Notes tendered in any Offer exceeds either the Maximum Offer Amount applicable to such series or, if lesser, the amount of the Tender Cap remaining available for application to the Acceptance Priority Level applicable to such Offer, then, if we accept Notes of such series for purchase, we will accept such Notes on a pro rata basis.
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 Offers may only be made pursuant to the terms of the Offer to Purchase and the related Letter of Transmittal.
Copies of the Offer to Purchase and the related Letter of Transmittal may be obtained from the Information Agent for the Offers, Global Bondholder Services Corporation, at (212) 430-3774 and (866) 873-6300 (collect).
Merrill Lynch & Co. is the Dealer Manager for the Offers. Questions regarding the Offers may be directed to Merrill Lynch & Co. at (800) ML4-TNDR (toll-free) and (212) 449-4914.
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.
