Lumen’s Level 3 gives early results of exchange offer, ups series caps

By Mary-Katherine Stinson

Lexington, Ky., March 30 – Lumen Technologies, Inc. announced the early results of indirect wholly owned subsidiary Level 3 Financing, Inc.’s exchange offer for eight series of notes and also increased the new note series cap for two of the series, according to a press release.

The offer is 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.

Listed in priority acceptance order, the following notes were tendered by the early exchange deadline of 5 p.m. ET on March 29, 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.

As previously reported, the final four series of notes are 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 will 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 remains $250 million.

All Lumen notes tendered at or before the early deadline will have priority in acceptance over notes tendered after that date, even if the notes tendered later have a higher acceptance priority.

March 29 was the withdrawal deadline.

The exchange offers expire at 5 p.m. ET on April 13.

Early settlement is expected for March 31. The final settlement date will occur promptly after expiration, expected to be April 17.

The exchange offers are 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 are 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.

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

To participate in the offers eligible holders must properly complete and submit the eligibility certification and, in the case of Canadian residents, the Canadian certification form. Holders who desire to obtain and complete an eligibility letter should either visit the website for this purpose at https://www.gbsc-usa.com/eligibility/lumen or call Global Bondholder Services Corp. the exchange and information agent for the exchange offers at 855 654-2014 or 212 430-3774.

Lumen is a Denver-based telecommunications company.

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