Frontier Communications Corporation (NASDAQ:FTR) announced today
that it has commenced tender offers (collectively, the “Tender
Offers”) to purchase for cash its 8.875% Senior Notes due 2020 (the
“8.875% Notes”), 6.250% Senior Notes due 2021, 9.250% Senior Notes
due 2021, 8.500% Senior Notes due 2020, 8.750% Senior Notes due
2022, 10.500% Senior Notes due 2022 and 7.125% Senior Notes due
2023 (collectively, the “Notes”) as described in the table below up
to an amount such that the maximum aggregate consideration
(excluding accrued interest) paid by the Company in the Tender
Offers does not exceed $1.6 billion (the “Aggregate Purchase
Price”), subject to the Acceptance Priority Levels and the
Acceptance Sublimits described below.
The terms and conditions of the Tender Offers are described in
the Company’s Offer to Purchase and Consent Solicitation Statement,
dated March 6, 2018 (the “Offer to Purchase”), and the related
Letter of Transmittal. The Tender Offers are intended to address
maturities and reduce the Company’s current overall interest
expense. The Tender Offers will be funded by the Company from the
proceeds of an anticipated debt financing, which the Company
expects to close by March 20, 2018.
The following table summarizes certain material terms for the
Tender Offers:
Dollars per $1,000 Principal Amount of
Notes
Title of Notes CUSIP/ISIN Numbers
Aggregate Principal
Amount Outstanding
Acceptance Priority
Level
Acceptance Sublimit
Tender
OfferConsideration(1)
EarlyTenderPremium
Total
Consideration(1)(2)
8.875% Senior Notes due 2020
Rule 144A:
$303,641,000 1 None $980.00 $50.00 $1,030.00 35906-AAR-9
Reg
S: U3144-QAE-0
Registered: 35906-AAT-5 6.250%
Senior Notes due 2021 35906A-AP-3 $775,000,000 2 None $850.00
$50.00 $900.00 9.250% Senior Notes due 2021 35906A-AL-2
$489,650,000 3 None $930.00 $50.00 $980.00 8.500% Senior
Notes due 2020 35906A-AH-1 $618,711,000 4 None $970.00 $50.00
$1,020.00 8.750% Senior Notes due 2022
Rule 144A:
$500,000,000 5 None $760.00 $50.00 $810.00 35906A-AJ-7
Registered: 35906A-AK-4 10.500% Senior Notes due 2022
Rule 144A: $2,187,537,000 6 $200,000,000 $820.00 $50.00
$870.00 35906A-AU-2
Reg S: U3144Q-AF-7
Registered:
35906A-AW-8 7.125% Senior Notes due 2023 35906A-AM-0
$850,000,000 7 $100,000,000 $610.00 $50.00 $660.00 (1)
Excludes accrued and unpaid interest, which also will be
paid. (2) Includes the Early Tender Premium.
Each of the Tender Offers will expire at 11:59 P.M., New York
City time, on April 2, 2018, unless extended (such date and time,
as it may be extended, the “Expiration Date”) or earlier terminated
by the Company in accordance with the terms of the Offer to
Purchase. No tenders submitted after the Expiration Date will be
valid.
Tendered Notes may be validly withdrawn from the applicable
Tender Offer at or prior to, but not after, 5:00 p.m., New York
City time, on March 19, 2018 (such date and time, as it may be
extended, the “Withdrawal Deadline”), unless otherwise required by
law. Holders who tender their Notes after the Withdrawal Deadline,
but prior to the Expiration Date, may not withdraw their tendered
Notes unless withdrawal rights are required to be extended pursuant
to applicable law.
Subject to the terms and conditions of the Tender Offers,
holders who validly tender, and do not validly withdraw, their
Notes at or prior to 5:00 P.M., New York City time, on March 19,
2018 (such date and time, as it may be extended, the “Early Tender
Date”), and whose Notes are accepted for purchase, will receive the
applicable total consideration set forth in the table above for
each $1,000 principal amount of Notes purchased pursuant to the
Tender Offers (the “Total Consideration”), which includes the early
tender premium set forth in the table above per $1,000 principal
amount of Notes (the “Early Tender Premium”). Subject to the terms
and conditions of the Tender Offers, holders who validly tender
their Notes after the Early Tender Date and at or prior to 11:59
P.M., New York City time, on the Expiration Date, and whose Notes
are accepted for purchase, will receive only the applicable tender
offer consideration amount set forth in the table above for each
$1,000 principal amount of Notes purchased pursuant to the Tender
Offers (the “Tender Offer Consideration”), which is equal to the
applicable Total Consideration minus the Early Tender Premium. In
addition to the applicable Total Consideration or the Tender Offer
Consideration, as the case may be, all holders of Notes accepted
for purchase pursuant to the Tender Offers will also receive on the
Early Settlement Date (as defined below) or the Final Settlement
Date (as defined below), as applicable, accrued and unpaid interest
on their Notes purchased from the applicable last interest payment
date with respect to such Notes up to, but not including, the Early
Settlement Date or the Final Settlement Date, as applicable.
The Notes accepted for purchase will be accepted in accordance
with their Acceptance Priority Levels set forth in the table above
(with 1 being the highest Acceptance Priority Level), provided that
(a) the Company will only accept for purchase Notes of any and all
series up to an amount such that the aggregate amount of Total
Consideration and/or Tender Offer Consideration, as the case may
be, paid by the Company pursuant to the Tender Offers will not
exceed the Aggregate Purchase Price, (b) the Company will not
purchase an aggregate principal amount of Notes of any series in
excess of the Acceptance Sublimit applicable to such series, if
any, as set forth in the table above, and (c) Notes tendered and
not validly withdrawn at or prior to the Early Tender Date will be
accepted for purchase in priority to Notes tendered after the Early
Tender Date and at or prior to the Expiration Date. The Company
reserves the right, but is under no obligation, to increase the
Aggregate Purchase Price and/or any or all of the Acceptance
Sublimits or to otherwise alter the terms of any Tender Offer at
any time, subject to compliance with applicable law, which could
result in the Company purchasing a greater aggregate principal
amount of any or all series of Notes in the Tender Offers.
Subject to the terms and conditions of the Tender Offers, the
Company expects to accept for purchase and purchase, subject to the
Aggregate Purchase Price, any Notes validly tendered and not
validly withdrawn at or prior to the Early Tender Date on the early
settlement date (the “Early Settlement Date”), which is currently
expected to occur on March 20, 2018. To the extent that the Tender
Offers are not fully subscribed at the Early Tender Date, the
Company expects to purchase any remaining Notes that have been
validly tendered after the Early Tender Date and at or prior to the
Expiration Date and that the Company accepts for purchase in
accordance with the terms and conditions of the Tender Offers,
promptly following the Expiration Date (the “Final Settlement
Date”), which is expected to occur on April 3, 2018. Notes accepted
on any Early Settlement Date or the Final Settlement Date will be
accepted subject to the Aggregate Purchase Price, the Acceptance
Priority Levels, the Acceptance Sublimits and proration, each as
described in the Offer to Purchase.
The Tender Offers are subject to the satisfaction or waiver of
certain conditions to the Tender Offers set forth in the Offer to
Purchase. The Tender Offers are not conditioned upon a minimum
principal amount of Notes being tendered.
In conjunction with the Tender Offers, the Company is soliciting
(the “Consent Solicitation”) from holders of the 8.875% Notes
consents to proposed amendments (“Proposed Amendments”) to the
indenture governing the 8.875% Notes (the “8.875% Notes
Indenture”), which would eliminate substantially all restrictive
covenants, certain events of default and certain other provisions
contained in the 8.875% Notes Indenture. The adoption of the
Proposed Amendments requires the consent of the holders of at least
a majority of the outstanding principal amount of 8.875% Notes (the
“Requisite Consents”). Each tendering holder of 8.875% Notes will
be deemed to have consented to the Proposed Amendments. If the
Company receives the Requisite Consents, it will execute a
supplemental indenture to the 8.875% Notes Indenture (the
“Supplemental Indenture”). The Supplemental Indenture will become
effective upon execution thereof by us and The Bank of New York
Mellon Trust Company, N. A., the trustee for the (the “Trustee”),
but will provide that the Proposed Amendments will not become
operative until we purchase in the Tender Offers at least a
majority in principal amount of the outstanding 8.875% Notes. If
the Tender Offer for the 8.875% Notes is terminated or withdrawn,
the 8.875% Notes Indenture will remain in effect in its present
form.
Full details of the terms and conditions of the Tender Offers
and the Consent Solicitation are described in the Offer to Purchase
and related Letter of Transmittal, which are being sent by the
Company to holders of the Notes. Holders of the Notes are
encouraged to read these documents, as they contain important
information regarding the Tender Offers and the Consent
Solicitation.
The Company has retained J.P. Morgan Securities LLC, Credit
Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC to act
as the Dealer Managers for the Tender Offers and Solicitation
Agents for the Consent Solicitation and Ipreo LLC as the Tender
Agent and Information Agent for the Tender Offers and the Consent
Solicitation. Questions regarding the Tender Offers and the Consent
Solicitation may be directed to J.P. Morgan Securities LLC at (866)
834-4666 (toll-free) or (212) 834-3260 (collect); Credit Suisse
Securities (USA) LLC at (800) 820-1653 (toll-free) or (212)
538-1862 (collect); Goldman Sachs & Co. LLC at (800) 828-3182
(toll-free) or (212) 357-1452 (collect); or Ipreo LLC at (212)
849-3880 (collect), (888) 593-9546 (toll-free) or email
tenderoffer@ipreo.com. Requests for additional copies of this Offer
to Purchase or the Letter of Transmittal should be directed to the
Information Agent at the phone number above.
None of the Company, its subsidiaries, its board of directors,
its employees, the Dealer Managers, the Solicitation Agents, the
Tender Agent and Information Agent or the Trustee with respect to
the Notes is making any recommendation as to whether holders should
tender any Notes in response to the Tender Offers or deliver
consents in the Consent Solicitation. Holders must make their own
decisions as to whether to participate in the Tender Offers and the
Consent Solicitation, and, if so, the principal amount of Notes to
tender and consent with respect thereto.
The Tender Offers and the Consent Solicitation are only being
made pursuant to the Offer to Purchase and the related Letter of
Transmittal. This press release is neither an offer to purchase nor
a solicitation of an offer to sell any Notes in the Tender Offers,
and is not a solicitation of consents to the Proposed Amendments.
The Tender Offers and the Consent Solicitation are not being made
to, nor will Notes be accepted for purchase from or on behalf of,
holders of Notes in any jurisdiction in which the making or
acceptance thereof would not be in compliance with the securities
or other laws of such jurisdiction. In any jurisdiction in which
the Tender Offers are required to be made by a licensed broker or
dealer, the Tender Offers will be deemed to be made on behalf of
the Company by one or more registered brokers or dealers that are
licensed under the laws of such jurisdiction.
The Company reserves the right, subject to applicable law, with
respect to any or all of the Tender Offers and/or the Consent
Solicitation to (a) extend the Early Tender Date, Withdrawal
Deadline or Expiration Date to a later date and time as announced
by the Company; (b) increase the Aggregate Purchase Price, (c)
increase all or any of the Acceptance Sublimits; (d) waive in whole
or in part any or all conditions to the Tender Offers; (e) delay
the acceptance for purchase of any Notes or delay the purchase of
any Notes; or (f) otherwise modify or terminate any Tender Offer
with respect to one or more series of Notes and/or the Consent
Solicitation.
This press release shall not constitute an offer to sell, or the
solicitation of any offer to buy, any securities, nor shall there
be any sales of securities mentioned in this press release in any
jurisdiction in which such offer, solicitation or sale would be
unlawful.
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) is a
leader in providing communications services to urban, suburban, and
rural communities in 29 states. Frontier offers a variety
of services to residential customers over its fiber-optic and
copper networks, including video, high-speed internet, advanced
voice, and Frontier Secure® digital protection solutions.
Frontier Business offers communications solutions to small, medium,
and enterprise businesses.
Forward-Looking Statements
This document contains "forward-looking statements," related to
future, not past, events. Forward-looking statements address our
expected future business and financial performance and financial
condition, and contain words such as "expect," "anticipate,"
"intend," "plan," "believe," "seek," "see," "will," "would," or
"target." Forward-looking statements by their nature address
matters that are, to different degrees, uncertain. These risks and
uncertainties include, but are not limited to: the success of the
debt financing; the success of the Tender Offers and the Consent
Solicitation, including the willingness of noteholders to tender
their notes at the price and on the terms and conditions proposed
by Frontier in the Offer to Purchase and Consent Solicitation and
their willingness to deliver consents in the Consent Solicitation;
and the other factors that are described in our filings with the
U.S. Securities and Exchange Commission, including our reports on
Forms 10-K and 10-Q. These risks and uncertainties may cause our
actual future results to be materially different than those
expressed in our forward-looking statements. We do not undertake to
update or revise these forward-looking statements.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20180306006732/en/
Frontier Communications CorporationInvestors:Luke
Szymczak, 203-614-5044Vice President, Investor
Relationsluke.szymczak@ftr.comorMedia:Brigid Smith,
203-614-5042AVP, Corp. Comm.brigid.smith@ftr.com
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