Lumen’s Level 3 swaps $19 million more old notes for $9.4 million new notes

By Wendy Van Sickle

Columbus, Ohio, April 17 – Lumen Technologies, Inc. announced its indirect wholly owned subsidiary Level 3 Financing, Inc. issued $9.4 million of additional new 10½% senior secured notes due 2030 on April 17 in exchange for $19 million principal amount of notes tendered after the early deadline of its exchange offer for eight series of notes, according to an 8-K filing with the Securities and Exchange Commission.

The offer, which was announced on March 16, was specifically to exchange senior unsecured notes issued by Lumen for up to $1.1 billion of new 10½% senior secured notes due 2030 issued by Level 3. It expired at 5 p.m. ET on April 13.

A breakdown of the additional existing notes tendered after the early deadline was not given.

As previously reported, after the early deadline, 5 p.m. ET on March 29, the company reported it would issue $915 million of the new notes for $1,535,000,000 principal amount of existing notes.

Listed in priority acceptance order, the following notes were tendered by the early exchange deadline, along with the total consideration offered:

• $48,022,000 of the $206.03 million outstanding 5 5/8% senior notes, series X, due 2025 (Cusip: 156700AZ9) for an early exchange consideration of $920 per each $1,000 principal of Lumen notes or $870 per each $1,000 principal of Lumen notes after the early deadline;

• $21,139,000 of the $65,801,000 outstanding 7.2% senior notes, series D, due 2025 (Cusip: 156686AJ6) for an early exchange consideration of $920 per each $1,000 principal of Lumen notes or $870 per each $1,000 principal of Lumen notes after the early deadline;

• $290,877,000 of the $702,956,000 outstanding 5 1/8% senior notes due 2026 (Cusips: 156700BB1, U1566PAB1) for an early exchange consideration of $710 per each $1,000 principal of Lumen notes or $660 per each $1,000 principal of Lumen notes after the early deadline;

• $52,356,000 of the $294,929,000 outstanding 6 7/8% debentures, series G, due 2028 (Cusip: 156686AM9) for an early exchange consideration of $680 per each $1,000 principal of Lumen notes or $630 per each $1,000 principal of Lumen notes after the early deadline;

• $274,847,000 of the $506,394,000 outstanding 5 3/8% senior notes due 2029 (Cusip: 550241AA1, U54985AA1) for an early exchange consideration of $550 per each $1,000 principal of Lumen notes or $500 per each $1,000 principal of Lumen notes after the early deadline;

• $555,969,000 of the $967,338,000 outstanding 4½% senior notes due 2029 (Cusips: 156700BD7, U1566PAD7) for an early exchange consideration of $550 per each $1,000 principal of Lumen notes or $500 per each $1,000 principal of Lumen notes after the early deadline;

• $160,689,000 of the $518 million outstanding 7.6% senior notes, series P, due 2039 (Cusip: 156700AM8) for an early exchange consideration of $525 per each $1,000 principal of Lumen notes or $475 per each $1,000 principal of Lumen notes after the early deadline; and

• $131,178,000 of the $435,268,000 outstanding 7.65% senior notes, series U, due 2042 (Cusip: 156700AT3) for an early exchange consideration of $525 per each $1,000 principal of Lumen notes or $475 per each $1,000 principal of Lumen notes after the early deadline.

Accrued interest will also be paid.

The final four series of notes were subject to a new note series cap. The company announced an increase in the new notes series cap for the two series of 2029 notes. The issuer said it would not issue more than $460 million of new notes in exchange for tendered 5 3/8% senior notes due 2029 and 4½% senior notes due 2029. The cap for both of those series was originally $400 million at the launch of the offer.

The new note series cap for the series P and series U notes remained $250 million.

The exchange offers were not conditioned upon any minimum amount of Lumen notes being tendered. Each offer is being made independently and is not conditioned upon the completion of any of the other exchange offers.

The offers were conditioned on the satisfaction or waiver of certain customary conditions.

The new notes will mature May 15, 2030 and will pay interest at a rate of 10½% annually.

The notes are fully and unconditionally guaranteed on an unsubordinated and secured basis by the issuer’s parent company, Level 3 Parent, LLC, and various subsidiaries, but not by Lumen or members of Lumen’s credit group.

The new notes contain restrictive covenants and events of default that are substantially similar to those of the issuer’s outstanding secured notes.

Global Bondholder Services Corp. was the exchange and information agent (855 654-2014 or 212 430-3774).

Lumen is a Denver-based telecommunications company.

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