Verizon Announces Exchange Offer for Certain Outstanding Verizon Wireless Notes
From Eligible Holders
NEW YORK, May 29, 2014 -- Verizon Communications Inc. ("Verizon") (NYSE,
NASDAQ: VZ; LSE: VZC) today announced the commencement of a private offer to
exchange (the "Exchange Offer") up to all of Cellco Partnership's and Verizon
Wireless Capital LLC's (together, "Verizon Wireless") £600,000,000 outstanding
aggregate principal amount of 8.875% Notes due December 18, 2018 (the "Existing
Notes") for Verizon's new sterling-denominated notes due 2024 (the "New Notes")
and an amount of cash. The Exchange Offer is conditioned on at least £
300,000,000 aggregate principal amount of Existing Notes- being validly
tendered.
The Exchange Offer will expire at 11:59 p.m. (New York time) on June 25, 2014,
unless extended by Verizon (the "Expiration Date"). Tenders of Existing Notes
in the Exchange Offer may be validly withdrawn at any time at or prior to 11:59
p.m. (New York time) on June 11, 2014, unless extended by Verizon, but not
thereafter, unless additional withdrawal rights are required by law. The price
for each £1,000 principal amount of Existing Notes tendered in the Exchange
Offer will be calculated at 12:00 noon (London time) on June 11, 2014, unless
extended by Verizon (the "Price Determination Date").
The Exchange Offer is being conducted by Verizon upon the terms and subject to
the conditions set forth in a confidential exchange offer memorandum, dated May
29, 2014 (the "Exchange Offer Memorandum"). The Exchange Offer is being
extended only (1) to holders of Existing Notes that are "Qualified
Institutional Buyers" as defined in Rule 144A under the U.S. Securities Act of
1933, as amended (the "U.S. Securities Act"), in a private transaction in
reliance upon the exemption from the registration requirements of the U.S.
Securities Act provided by Section 4(a)(2) thereof and (2) outside the United
States, to holders of Existing Notes other than "U.S. persons" (as defined in
Rule 902 under Regulation S of the U.S. Securities Act) and who are not
acquiring New Notes for the account or benefit of a U.S. person, in offshore
transactions in compliance with Regulation S under the U.S. Securities Act, and
who are "Non-U.S. qualified offerees" (as defined in the Exchange Offer
Memorandum) (each of the foregoing, an "Eligible Holder").
The complete terms of the Exchange Offer are described in the Exchange Offer
Memorandum. Eligible Holders that validly tender and do not validly withdraw
their Existing Notes at or prior to 11:59 p.m. (New York time) on June 11, 2014
(unless extended by Verizon, the "Early Participation Date") will receive the
Total Exchange Price, which includes an early exchange premium of £50.00
principal amount of New Notes in respect of each £1,000 principal amount of
Existing Notes tendered, as described in the Exchange Offer Memorandum.
Eligible Holders of Existing Notes who tender after the Early Participation
Date, but at or prior to the Expiration Date, will receive the Exchange Price,
which is the Total Exchange Price minus the early exchange premium. Verizon
reserves the right, subject to applicable law, to extend, terminate or
otherwise amend the terms of the Exchange Offer.
The following table sets forth information regarding the Exchange Offer:
Principal Exchange Bloomberg
ISIN Amount Reference Reference
Existing Notes Number Outstanding Security Page
8.875% Notes due 18
December 2018, issued by XS040587667 £600,000,000 UKT 5.00% due DMO 2
Verizon Wireless 7 March 2018
Composition of Hypothetical Total
Exchange Price
Exchange Spread Hypothetical Total Exchange Cash Hypothetical New Notes
(Basis Points) New Notes Price(1,2,3) Amount(1,4) Amount(1,2,5)
Notes due
+40 2024 £1,300.37 £80 £1,220.37
issued by
Verizon
(1) Hypotheticals are shown for illustrative purposes only. The actual Total
Exchange Price, the actual New Notes Amount and, if applicable, the Adjusted
Cash Amount (each as defined in the Exchange Offer Memorandum) will be
determined on the Price Determination Date.
(2) Includes the early exchange premium of £50.00 principal amount of New Notes
in respect of each £1,000 principal amount of Existing Notes tendered at or
prior to the Early Participation Date and accepted for exchange.
(3) Sum of the Cash Amount (as defined in the Exchange Offer Memorandum) and
the hypothetical New Notes Amount in respect of each £1,000 principal amount of
Existing Notes accepted for exchange.
(4) The Cash Amount payable as a portion of the Total Exchange Price in respect
of each £1,000 principal amount of Existing Notes accepted for exchange. The
Cash Amount excludes accrued and unpaid interest on the Existing Notes, which
will be payable in addition to the Total Exchange Price. The Cash Amount is
subject to adjustment as described in the Exchange Offer Memorandum.
(5) Hypothetical principal amount of New Notes to be issued in respect of each
£1,000 principal amount of Existing Notes validly tendered at or prior to the
Early Participation Date and accepted for exchange. Subject to adjustment as
described in the Exchange Offer Memorandum.
The New Notes will bear interest at a rate per annum equal to the sum of (i)
the yield of the 2.25% United Kingdom Treasury Bond due September 7, 2023, as
calculated by the lead dealer manager in accordance with standard market
practice, as of the Price Determination Date, appearing on the U.K. DMO 2 Page
as displayed on the Bloomberg Pricing Monitor, or any other recognized
quotation source selected by the lead dealer manager in its sole discretion if
such quotation report is not available or manifestly erroneous plus (ii) the
New Notes Spread. The New Notes Spread will be the number of basis points
determined, in the sole discretion of Verizon, at or around 11:00 a.m. (London
time) on June 2, 2014, but shall be equal to or greater than 1.30% (130 basis
points).
Eligible Holders are advised to check with any bank, securities broker or other
intermediary through which they hold Existing Notes as to when such
intermediary needs to receive instructions from an Eligible Holder in order for
that Eligible Holder to be able to participate in, or (in the circumstances in
which revocation is permitted) revoke their instruction to participate in, the
Exchange Offer before the deadlines specified herein and in the Exchange Offer
Memorandum. The deadlines set by each clearing system for the submission and
withdrawal of exchange instructions will also be earlier than the relevant
deadlines specified herein and in the Exchange Offer Memorandum.
If and when issued, the New Notes will not be registered under the U.S.
Securities Act or any state securities laws. Therefore, the New Notes may not
be offered or sold in the United States absent registration or an applicable
exemption from the registration requirements of the U.S. Securities Act and any
applicable state securities laws.
This press release is not an offer to sell or a solicitation of an offer to buy
any security. The Exchange Offer is being made solely by the Exchange Offer
Memorandum and only to such persons and in such jurisdictions as is permitted
under applicable law.
In particular, this communication is only addressed to and directed at: (A) in
any Member State of the European Economic Area that has implemented the
Prospectus Directive (as defined below), qualified investors in that Member
State within the meaning of the Prospectus Directive and (B) (i) persons that
are outside the United Kingdom or (ii) persons in the United Kingdom who are
investment professionals falling within Article 19(5) of the Financial Services
and Markets Act 2000 (Financial Promotion) Order 2005 (the "Financial Promotion
Order") or within Article 43 of the Financial Promotion Order, or any other
person to whom it may otherwise lawfully be communicated by virtue of an
exemption to Section 21(1) of the Financial Services and Markets Act 2000, as
amended, or otherwise in circumstance where it does not apply (such persons
together being referred to as "relevant persons"). The New Notes are only
available to, and any invitation, offer or agreement to subscribe, purchase or
otherwise acquire such New Notes will be engaged in only with, relevant
persons. Any person who is not a relevant person should not act or rely on the
Exchange Offer Memorandum or any of its contents. For purposes of the
foregoing, the "Prospectus Directive" means the Prospectus Directive 2003/71/
EC, as amended, including pursuant to Directive 2010/73/EU.
Cautionary Statement Regarding Forward-Looking Statements
In this communication we have made forward-looking statements. These
statements are based on our estimates and assumptions and are subject to risks
and uncertainties. Forward-looking statements include the information
concerning our possible or assumed future results of operations.
Forward-looking statements also include those preceded or followed by the words
"anticipates," "believes," "estimates," "hopes" or similar expressions. For
those statements, we claim the protection of the safe harbor for
forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995. The following important factors, along with those discussed
in our filings with the Securities and Exchange Commission (the "SEC"), could
affect future results and could cause those results to differ materially from
those expressed in the forward-looking statements: the ability to realize the
expected benefits of our transaction with Vodafone in the timeframe expected or
at all; an adverse change in the ratings afforded our debt securities by
nationally accredited ratings organizations or adverse conditions in the credit
markets affecting the cost, including interest rates, and/or availability of
further financing; significantly increased levels of indebtedness as a result
of the Vodafone transaction; changes in tax laws or treaties, or in their
interpretation; adverse conditions in the U.S. and international economies;
material adverse changes in labor matters, including labor negotiations, and
any resulting financial and/or operational impact; material changes in
technology or technology substitution; disruption of our key suppliers'
provisioning of products or services; changes in the regulatory environment in
which we operate, including any increase in restrictions on our ability to
operate our networks; breaches of network or information technology security,
natural disasters, terrorist attacks or acts of war or significant litigation
and any resulting financial impact not covered by insurance; the effects of
competition in the markets in which we operate; changes in accounting
assumptions that regulatory agencies, including the SEC, may require or that
result from changes in the accounting rules or their application, which could
result in an impact on earnings; significant increases in benefit plan costs or
lower investment returns on plan assets; and the inability to implement our
business strategies.
SOURCE Verizon Communications Inc.
CONTACT: Bob Varettoni,
908-559-6388, robert.a.varettoni@verizon.com