Verizon Communications Inc. commenced private offers, for its own account and for its unit GTE LLC, to buy certain outstanding series of notes for cash or in exchange for newly issued debt securities of Verizon.
Verizon said July 31 that it is using a "waterfall" methodology to accept old notes, whereby notes will be accepted in order of their acceptance priority level, subject to certain caps. Further, Verizon has set a $2.0 billion cap on the total cash it pays to buy old notes validly tendered under the cash offers and a $4.0 billion cap on the aggregate principal amount of new notes it issues in exchange for old notes. The exchange offers are also subject to minimum issue requirement, whereby at the applicable early participation date the aggregate principal amount of new notes to be issued on the early settlement date must be at least $750 million.
Verizon expects gross proceeds of at least $3.0 billion from the cash offerings.
The offer is set to expire at 11:59 pm ET on Aug. 25, subject to extension or earlier termination. To receive the total consideration, including the early participation payment, eligible holders must validly tender their old notes at or before 5:00 p.m. ET on Aug 11, unless extended or earlier terminated. Eligible holders who validly tender their old notes after the early participation date, but at or before the expiration date, will be eligible to receive the tender consideration for any such series, which is equivalent to the total consideration minus the early participation payment.
Old notes may be validly withdrawn at any time at or before 5:00 p.m. ET on Aug. 11, but not later.