T-Mobile seeks approval to amend 10 series for merger with Sprint

By Susanna Moon

Chicago, May 14 – T-Mobile USA, Inc. said it is soliciting consents for 10 series of notes in connection with a planned merger with Sprint Corp.

The consent solicitations will run until 5 p.m. ET on May 18.

The solicitation consists of the ratio secured debt consent solicitation and existing Sprint spectrum and GAAP consent solicitation, according to a company announcement.

For the pre-2017 notes, the company is seeking consents under ratio secured debt consent solicitation to conform a section of the indenture to that of the post-2017 notes by increasing the amount of debt under credit facilities that can be incurred to the greater of $9 billion and an amount that would not cause the secured debt to cash flow ratio to exceed 2 times from the greater of $9 billion and 150% of consolidated cash flow.

For all of the notes, the company is asking for approval under the existing Sprint spectrum and GAAP consent solicitation for the following: to allow some entities related to Sprint's existing spectrum securitization notes program to be non-guarantor restricted subsidiaries and make some other changes in connection with, provided that the principal amount of the spectrum notes issued and outstanding under the existing Sprint spectrum program does not exceed $7 billion, and provided that the principal amount of the spectrum notes will reduce the amount available under the credit facilities ratio basket; and to revise the definition of GAAP to mean generally accepted accounting principles as in effect from time to time, unless the company elects to "freeze" GAAP as of any date, and to exclude the effect of changes in the accounting treatment of capital lease obligations.

The notes covered by the consent solicitation with consent fees are as follows:

• $1.3 billion principal amount of 6% senior notes due 2023 with upfront payment of $3.25 million and contingent payment of $6.5 million for the ratio secured amendments; and upfront payment of $1,625,000 and contingent payment of $4,875,000 for Sprint spectrum and GAAP amendments;

• $1 billion principal amount of 6½% senior notes due 2024 with upfront fee of $2.5 million and contingent fee of $5 million for the ratio changes; and upfront fee of $1.25 million and contingent fee of $3.75 million for the Sprint spectrum and GAAP amendments;

• $1 billion principal amount of 6% senior notes due 2024 with upfront fee of $2.5 million and contingent fee of $5 million for the ratio changes; and upfront fee of $1.25 million and contingent fee of $3.75 million for the Sprint spectrum and GAAP amendments;

• $1.7 billion principal amount of 6 3/8% senior notes due 2025 with upfront fee of $4.25 million and contingent fee of $12.75 million for the ratio changes; and upfront fee of $2,125,000 and contingent fee of $6,375,000 for the Sprint spectrum and GAAP amendments;

• $2 billion principal amount of 6½% notes due 2026 with upfront fee of $5 million and contingent fee of $25 million for the ratio changes; and upfront fee of $2.5 million and contingent fee of $7.5 million for the Sprint spectrum and GAAP amendments;

• $500 million principal amount of 4% senior notes due 2022 with upfront fee of $625,000 and contingent fee of $1,875,000 for the Sprint spectrum and GAAP amendments;

• $500 million principal amount of 5 1/8% senior notes due 2025 with upfront fee of $625,000 and contingent fee of $1,875,000 for the Sprint spectrum and GAAP amendments;

• $500 million principal amount of 5 3/8% senior notes due 2027 with upfront fee of $625,000 and contingent fee of $1,875,000 for the Sprint spectrum and GAAP amendments;

• $1 billion principal amount of 4½% senior notes due 2026 with upfront fee of $1.25 million and contingent fee of $3.75 million for the Sprint spectrum and GAAP amendments; and

• $1.5 billion principal amount of 4¾% senior notes due 2028 with upfront fee of $1,875,000 and contingent fee of $5,625,000 for the Sprint spectrum and GAAP amendments.

The company is offering to pay upfront payments for each series of notes on a pro rata basis for holders who give consents to the ratio secured debt proposed amendments and/or the existing Sprint spectrum and GAAP proposed amendments if the conditions to the solicitation have been met and the T-Mobile, Sprint deal closes, the release noted.

For the amendments to pass, the company must garner support from holders of a majority of each series of pre-2017 notes for the ratio secured debt amendments and each series of notes for the Sprint spectrum and GAAP amendments.

The solicitation agent is Deutsche Bank Securities Inc. (855 287-1922 or 212 250-7527). The information and tabulation agent is D.F. King & Co., Inc. (212 269-5550, 800 676-7437 or tmobile@dfking.com).

T-Mobile is a Bellevue, Wash.-based wireless communications provider. It is a direct wholly owned subsidiary of T-Mobile US, Inc.

Sprint is an Overland Park, Kan., telecommunications company.

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