Level
3 Completes Offering of $345 Million of 5.25% Convertible
Senior Notes [December 2, 2004]
BROOMFIELD,
Colo., December 2, 2004 – Level 3 Communications,
Inc. (Nasdaq:LVLT) announced today that it has completed
the offering of $345 million aggregate principal amount
of its 5.25% Convertible Senior Notes due 2011 (the
“Notes”) in a private offering to “qualified
institutional buyers” as defined in Rule 144A
under the Securities Act of 1933. The final offering
amount included the exercise by the initial purchasers
in full of their option to purchase up to an additional
$25 million aggregate principal amount of the Notes.
The Notes are convertible into shares of Level 3’s
common stock at an initial conversion price of $3.984
per share.
Level 3 used a portion of the net proceeds
from the offering of the Notes, together with borrowings
under a new $730 million senior secured term loan that
its subsidiary, Level 3 Financing, Inc., completed today,
to fund the purchase of certain debt securities due
2008 pursuant to Level 3’s previously announced
debt tender offers. The settlement of the debt tender
offers will be completed today.
In addition, Level 3 used a portion
of the net proceeds from the offering of the Notes to
enter into bond hedge and warrant transactions with
respect to its common stock. The transactions are designed
to enable the company to limit dilution from the conversion
of the Notes. The transactions effectively increase
the conversion premium to approximately 80.7%. The cost
of the bond hedge and warrant transactions is approximately
17.8% of the gross proceeds from the offering of the
Notes.
The Notes were not registered under
the Securities Act of 1933, as amended or any state
securities laws and, unless so registered, may not be
offered or sold except pursuant to an applicable exemption
from the registration requirements of the Securities
Act of 1933 and applicable state securities laws.
About
Level 3 Communications
Level 3 (Nasdaq:LVLT) is an international communications
and information services company. The company operates
one of the largest Internet backbones in the world,
is one of the largest providers of wholesale dial-up
service to ISPs in North America and is the primary
provider of Internet connectivity for millions of broadband
subscribers, through its cable and DSL partners. The
company offers a wide range of communications services
over its 23,000-mile broadband fiber optic network including
Internet Protocol (IP) services, broadband transport
and infrastructure services, colocation services, and
patented softswitch managed modem and voice services.
Its Web address is www.Level3.com.
The company offers information services
through its subsidiaries, Software Spectrum and (i)Structure.
For additional information, visit their respective Web
sites at www.softwarespectrum.com and www.i-structure.com.
The Level 3 logo is a registered service mark of
Level 3 Communications, Inc. in the United States and/or
other countries.
Forward
Looking Statement
Some of the statements made by Level 3 in this press
release are forward-looking in nature. Actual results
may differ materially from those projected in forward-looking
statements. Level 3 believes that its primary risk factors
include, but are not limited to: changes in the overall
economy relating to, among other things, the September
11 attacks and subsequent events, substantial capital
requirements; development of effective internal processes
and systems; the ability to attract and retain high
quality employees; technology; the number and size of
competitors in its markets; law and regulatory policy;
and the mix of products and services offered in the
company's target markets. 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 release should be evaluated
in light of these important factors. |
