The company noted that these notes are senior unsecured obligations which rank equal in right of payment with all existing and future unsubordinated indebtedness. The New Notes mature on March 15, 2015 and pay 7% annual interest, paid semi-annually each year.
The notes are convertible into common stock at an initial conversion price of $1.80 per share (actually 555.5556 shares per $1,000 principal amount). The terms also disclosed that the note holders may require Level 3 to repurchase all or any part of their new notes upon the occurrence of a designated event at 100% of the principal amount plus accrued and unpaid interest. This still appears effectively the same as the first filing.
These notes were offered under an existing shelf registration filed on November 4, 2008 that allows the company to sell debt and equity from time to time.
Shares are down 1.4% at $1.38 in after-hours trading, and that is on top of a 0.7% drop to $1.40 during the trading day. Its 52-week trading range is $0.57 to $1.57 and Level 3 reports earnings on October 28.
While we have not compared the data inside the earlier filing word for word, this appears to be the same before in $275 million due in 2015 to pay down debt maturities outside of the “New Notes” issue. Either way, this actually puts the maturity schedule out further for the company.
JON C. OGG
OCTOBER 15, 2009
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