Company Website:
http://www.intelsat.com
LUXEMBOURG -- (Business Wire)
Intelsat S.A. (NYSE:I) (“Intelsat”), operator of the world’s first
Globalized Network, powered by its leading satellite backbone, today
announced that its indirect wholly-owned subsidiaries, Intelsat Jackson
Holdings S.A. (“Intelsat Jackson”), Intelsat Connect Finance S.A.
(“ICF”), and Intelsat (Luxembourg) S.A. (“Intelsat Luxembourg” and,
together with Intelsat Jackson and ICF, the “Issuers”) each intends to
commence offers to exchange (the “Exchange Offers”) new Exchange Notes
(as defined below) for certain of its respective outstanding senior
unsecured notes on the terms described below. By their terms, the
Exchange Notes will, on the closing date of the Combination (as defined
below), be mandatorily exchanged at a discount for Final Jax Notes (as
defined below), newly issued common shares of Intelsat, and/or cash.
The Exchange Offers and related Consent Solicitations (as defined below)
will be conducted pursuant to the Combination Agreement, dated as of
February 28, 2017 (the “Combination Agreement”), between Intelsat and
WorldVu Satellites Limited (“OneWeb”), pursuant to which OneWeb will
combine with Intelsat on the terms and subject to the conditions set
forth in the Combination Agreement (the “Combination”). While the
Exchange Offers and Consent Solicitations are expected to be consummated
prior to closing of the Combination, the exchange of the Exchange Notes
for Final Jax Notes, common shares of Intelsat and/or cash will be
conditioned upon, and occur automatically and mandatorily upon the
occurrence of, the closing of the Combination. The Exchange Offers and
Consent Solicitations will be subject to certain conditions, including,
among others, the tender of a minimum of 85% of the aggregate
outstanding principal amount of each series of Existing Notes (as
defined below).
Exchange Offers
Intelsat Jackson. Intelsat Jackson
expects to offer to exchange (the “Jax Exchange Offers”):
(i) new 7.25% Mandatorily Exchangeable Senior Notes due 2019 to be
issued by Intelsat Jackson (the “Jax 2019 Exchange Notes”) for any and
all of its existing 7.25% Senior Notes due 2019 (the “Jax 2019 Existing
Notes”);
(ii) new 7.25% Mandatorily Exchangeable Senior Notes due 2020 to be
issued by Intelsat Jackson (the “Jax 2020 Exchange Notes”) for any and
all of its existing 7.25% Senior Notes due 2020 (the “Jax 2020 Existing
Notes”);
(iii) new 7.50% Mandatorily Exchangeable Senior Notes due 2021 to be
issued by Intelsat Jackson (the “Jax 2021 Exchange Notes”) for any and
all of its existing 7.50% Senior Notes due 2021 (the “Jax 2021 Existing
Notes”); and
(iv) new 5.50% Mandatorily Exchangeable Senior Notes due 2023 to be
issued by Intelsat Jackson (the “Jax 2023 Exchange Notes” and, together
with the Jax 2019 Exchange Notes, Jax 2020 Exchange Notes, and Jax 2021
Exchange Notes, the “Jax Exchange Notes”) for any and all of its
existing 5.50% Senior Notes due 2023 (the “Jax 2023 Existing Notes” and,
together with the Jax 2019 Existing Notes, Jax Existing 2020 Notes, and
Jax 2021 Existing Notes, the “Jax Existing Notes”).
ICF. ICF expects to offer to
exchange (the “ICF Exchange Offer”) new 12.50% Mandatorily Exchangeable
Senior Notes due 2022 to be issued by ICF (the “ICF Exchange Notes”) for
any and all of its existing 12.50% Senior Notes due 2022 (the “ICF
Existing Notes”).
Intelsat Luxembourg. Intelsat
Luxembourg expects to offer to exchange (the “Lux Exchange Offers”):
(i) new 7.75% Mandatorily Exchangeable Senior Notes due 2021 to be
issued by Intelsat Luxembourg (the “Lux 2021 Exchange Notes”) for any
and all of its existing 7.75% Senior Notes due 2021 (the “Lux 2021
Existing Notes”); and
(ii) new 8.125% Mandatorily Exchangeable Senior Notes due 2023 to be
issued by Intelsat Luxembourg (the “Lux 2023 Exchange Notes” and,
together with the Lux 2021 Exchange Notes, the “Lux Exchange Notes”;
collectively, with the Jax Exchange Notes and ICF Exchange Notes, the
“Exchange Notes”) for any and all of its existing 8.125% Senior Notes
due 2023 (the “Lux 2023 Existing Notes” and, together with the Lux 2021
Existing Notes, the “Lux Existing Notes”).
Consent Solicitations
It is anticipated that, in connection with the Exchange Offers, the
Issuers will solicit consents (the “Consent Solicitations”) to amend the
indentures governing the Jax Existing Notes, the ICF Existing Notes, and
the Lux Existing Notes (collectively, the “Existing Notes”, and the
indentures governing the Existing Notes, collectively, the “Existing
Indentures”). The proposed amendments to the Existing Indentures require
the consent of a majority of the outstanding aggregate principal amount
of each applicable series of Existing Notes and would eliminate
substantially all of the restrictive covenants, modify or eliminate
certain other provisions of the Existing Indentures and waive past
defaults, if any.
Jax Exchange Notes
It is anticipated that each of the Jax Exchange Offers will provide for
the issuance of $1,000 principal amount of the applicable series of Jax
Exchange Notes in exchange for each $1,000 principal amount of the
applicable series of Jax Existing Notes tendered and accepted. Prior to
the closing date of the Combination (such date, the “Combination Date”),
the Jax Exchange Notes will have substantially identical terms to the
corresponding series of the Jax Existing Notes for which they are
exchanged, including the same guarantors, interest rates, interest
payment and maturity dates and substantially identical covenants. If the
Combination does not occur, the Jax Exchange Notes will retain their
respective original principal amounts and these same terms.
It is anticipated that the terms of the Jax Exchange Notes will provide
that, on the Combination Date (and subject to the occurrence thereof),
(a) each series of the Jax Exchange Notes will (i) as to a portion of
the principal amount thereof, become automatically due and payable in
cash; and (ii) as to the remaining portion of the principal amount
thereof, be automatically and mandatorily exchanged into new unsecured
5-Year Senior Notes to be issued by Intelsat Jackson (the “Final Jax
5-Year Notes”) or new unsecured 7-Year Senior Notes to be issued by
Intelsat Jackson (the “Final Jax 7-Year Notes” and, together with the
Final Jax 5-Year Notes, the “Final Jax Notes”) on the terms set forth
below; and (b) each series of the Jax Exchange Notes will be cancelled
and will cease to be outstanding (collectively, the “Mandatory Jax
Exchanges”). Specifically, on the Combination Date, each holder of the
Jax Exchange Notes will automatically be entitled to receive, for each
$1,000 principal amount of the applicable series of the Jax Exchange
Notes held, the following consideration:
|
| |
| |
| |
| |
Applicable Series of Jax Exchange
Notes |
| Total Consideration (cash and
principal amount of Final Jax Notes) |
| Cash Consideration(1)(2) |
| Final Jax 5-Year Notes (principal
amount)(1)(2) |
| Final Jax 7-Year Notes (principal
amount)(1)(2) |
For each $1,000 principal amount of Jax 2019 Exchange
Notes
|
|
$940.00
|
|
$45.65 - $90.20
|
|
$849.80 - $894.35
|
|
$0.00 - $0.00
|
For each $1,000 principal amount of Jax 2020 Exchange
Notes
|
|
$880.00
|
|
$45.65 - $90.20
|
|
$789.80 - $834.35
|
|
$0.00 - $0.00
|
For each $1,000 principal amount of Jax 2021 Exchange
Notes
|
|
$860.00
|
|
$45.65 - $90.20
|
|
$0.00 - $0.00
|
|
$769.80 - $814.35
|
For each $1,000 principal amount of Jax 2023 Exchange
Notes
|
|
$760.00
|
|
$45.65 - $90.20
|
|
$0.00 - $0.00
|
|
$669.80 - $714.35
|
(1)
|
|
It is anticipated that the aggregate cash consideration paid in all
Exchange Offers upon mandatory exchange will equal approximately
$1.7 billion and that the amount of cash consideration and Final Jax
Notes received by holders of Jax Exchange Notes upon the mandatory
exchange will depend on the participation level of holders of
Existing Notes in each of the Exchange Offers. The chart above shows
the minimum and maximum amount of cash consideration, Final Jax-5
Year Notes, and Final Jax 7-Year Notes which a holder of Jax
Exchange Notes will receive in the Mandatory Jax Exchanges. A holder
of Jax Exchange Notes would receive (i) the minimum cash
consideration and maximum amount of Final Jax Notes shown above if
holders of 100% of the Existing Notes of each series participate in
the applicable Exchange Offer, (ii) the maximum cash consideration
and minimum amount of Final Jax Notes shown above if holders of 85%
of the Existing Notes of each series participate in the applicable
Exchange Offer, and (iii) an amount in between the minimum and
maximum amounts of cash and Final Jax Notes shown above if
participation in any of the Exchange Offers is greater than 85% and
less than 100%. However, the aggregate amount of cash and principal
amount of Final Jax Notes received by a holder of Jax Exchange Notes
will be constant, regardless of participation levels in the Exchange
Offers.
|
(2)
| |
Amounts rounded to the nearest cent.
|
| |
|
In addition, accrued but unpaid interest on the Jax Exchange Notes
through the Combination Date will be paid upon consummation of the
Mandatory Jax Exchanges.
It is anticipated that the Final Jax 5-Year Notes will mature on the
fifth anniversary of the Combination Date, and that interest on the
Final Jax 5-Year Notes will accrue at the rate of 6.75% per annum and be
payable semi-annually in arrears. The Final Jax 5-Year Notes are
expected to be redeemable at the option of Intelsat Jackson (i) prior to
the second anniversary of the Combination Date pursuant to a customary
“make whole” provision and (ii) thereafter, pursuant to a customary call
schedule.
It is anticipated that the Final Jax 7-Year Notes will mature on the
seventh anniversary of the Combination Date, and that interest on the
Final Jax 7-Year Notes will accrue at the rate of 7.25% per annum and be
payable semi-annually in arrears. The Final Jax 7-Year Notes are
expected to be redeemable at the option of Intelsat Jackson (i) prior to
the third anniversary of the Combination Date pursuant to a customary
“make whole” provision; and (ii) thereafter, pursuant to a customary
call schedule.
It is anticipated that the indentures governing the Final Jax Notes will
include customary restrictive covenants and events of default.
ICF Exchange Notes and Lux Exchange Notes
It is anticipated that the ICF Exchange Offer will provide for the
issuance of $1,000 principal amount of the ICF Exchange Notes in
exchange for each $1,000 principal amount of the ICF Existing Notes
tendered and accepted, and that each of the Lux Exchange Offers will
provide for the issuance of $1,000 principal amount of the applicable
series of the Lux Exchange Notes in exchange for each $1,000 principal
amount of the corresponding series of the Lux Existing Notes tendered
and accepted. Prior to the Combination Date, the ICF Exchange Notes and
the Lux Exchange Notes will have substantially the same terms as the
corresponding series of Existing Notes for which they are exchanged,
including the same guarantors, interest rates, interest payment and
maturity dates and substantially identical covenants. If the Combination
does not occur, the ICF Exchange Notes and the Lux Exchange Notes will
retain their respective original principal amounts and these same terms.
It is anticipated that the terms of the ICF Exchange Notes and the Lux
Exchange Notes will provide that, on the Combination Date (and subject
to the occurrence thereof), (a) the ICF Exchange Notes and the Lux
Exchange Notes will (i) as to a portion of the principal amount thereof,
become automatically due and payable in cash; and (ii) as to the
remaining portion of the principal amount thereof, be automatically and
mandatorily exchanged into a specified number of newly issued common
shares of Intelsat (“New Common Shares”), valued at $5.00 per share; and
(b) the ICF Exchange Notes and the Lux Exchange Notes will be cancelled
and will cease to be outstanding (collectively, the “Mandatory ICF/Lux
Exchanges”). Specifically, on the Combination Date, each holder of the
ICF Exchange Notes or the Lux Exchange Notes will automatically be
entitled to receive, for each $1,000 principal amount of the applicable
series of the ICF Exchange Notes or the Lux Exchange Notes held, the
following consideration:
Applicable Series of ICF Exchange Notes or Lux
Exchange Notes |
| Total Consideration (cash and value
of New Common Shares)(1) |
| Cash Consideration |
| New Common Shares(1) |
For each $1,000 principal amount of ICF Exchange Notes
|
|
$780.00
|
|
$768.00
|
|
$12.00
|
For each $1,000 principal amount of Lux 2021 Exchange Notes
|
|
$460.00
|
|
$448.00
|
|
$12.00
|
For each $1,000 principal amount of Lux 2023 Exchange Notes
|
|
$460.00
|
|
$448.00
|
|
$12.00
|
(1) Assuming a value of $5.00 per share, which is the subscription price
for common shares of Intelsat being purchased by SoftBank Group Corp. in
connection with the Combination.
In addition, accrued but unpaid interest on the ICF Exchange Notes and
the Lux Exchange Notes through the Combination Date will be paid upon
consummation of the Mandatory ICF/Lux Exchanges. The New Common Shares
issued to holders of the ICF Exchange Notes and the Lux Exchange Notes,
assuming 100% participation in the ICF Exchange Offer and the Lux
Exchange Offers, is anticipated to equal approximately 1.0% of the
outstanding common shares of Intelsat as of the date hereof after giving
pro forma effect to the issuance of common shares to OneWeb stockholders
pursuant to the Combination Agreement and to SoftBank Group Corp.
pursuant to the related stock purchase agreement. Such New Common Shares
are subject to dilution by any other equity issuances on or after the
date hereof. Fractional New Common Shares will not be issued and the
number of New Common Shares received by any applicable Eligible Holder
will be rounded down to the nearest whole share.
Other Terms
The terms of the Combination Agreement require the Exchange Offers and
Consent Solicitations to be launched promptly after the date of the
Combination Agreement or at such other time as mutually agreed by OneWeb
and Intelsat. The consummation of the Exchange Offers will be subject to
certain conditions, including, among others, the tender of a minimum of
85% of the aggregate outstanding principal amount of each series of
Existing Notes.
It is anticipated that none of the Jax Exchange Notes, the Final Jax
Notes, the ICF Exchange Notes, the Lux Exchange Notes, or the New Common
Shares (collectively, the “Consideration Securities”) will be registered
under the Securities Act of 1933, as amended (the "Securities Act"), or
any other applicable securities laws and, unless so registered, none of
the Consideration Securities may be offered, sold, pledged or otherwise
transferred in the United States or to or for the account or benefit of
any U.S. person, except pursuant to an exemption from the registration
requirements of the Securities Act. The Issuers do not intend to
register the Consideration Securities under the Securities Act or the
securities laws of any other jurisdiction. None of the Consideration
Securities will be transferable except in accordance with restrictions
which will be described more fully in any applicable offering
memorandums (the “Offering Memoranda”).
It is anticipated that the Exchange Offers will be made, and each series
of the Consideration Securities to be issued pursuant to and in
connection with the Exchange Offers will be offered and issued, only (a)
in the United States to holders of Existing Notes, as applicable, who
are “qualified institutional buyers” (as defined in Rule 144A under the
Securities Act), (b) in the United States to holders of Existing Notes,
as applicable, not resident in Arkansas who are institutional
“accredited investors” (within the meaning of Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Securities Act) and (c) outside the
United States to holders of Existing Notes, as applicable, who are
persons other than U.S. persons in reliance upon Regulation S under the
Securities Act, and, in the case of clauses (b) and (c) above, who are
also an "institutional account" within the meaning of FINRA Rule
4512(c). It is anticipated that only holders of Existing Notes who
certify to the applicable Issuer that they are eligible to participate
in the applicable Exchange Offer pursuant to at least one of the
foregoing conditions (“Eligible Holders”) will be authorized to receive
or review the related Offering Memorandum or participate in such
Exchange Offer. If any holder of the Existing Notes is not an Eligible
Holder, such holder will not be able to receive the Offering Memoranda.
It is anticipated that the Exchange Offers and Consent Solicitations
will be conducted pursuant to the Offering Memoranda and related
materials (collectively, the “Exchange Offer Materials”).
Questions regarding the Exchange Offers and Consent Solicitations may be
directed to the Issuers at the following email address: Attn: Investor
Relations, Email: investor.relations@intelsat.com.
The complete terms and conditions of the Exchange Offers and Consent
Solicitations, as well as the terms of each of the Consideration Notes,
will be set forth in Offering Memoranda. The Offering Memoranda will
only be made available to holders who complete an eligibility letter
confirming their status as Eligible Holders.
The Issuers will make the Exchange Offers only by, and pursuant to, the
terms of the Exchange Offer Materials. None of Intelsat, the Issuers,
the Information and Exchange Agent, nor their respective affiliates
makes any recommendation as to whether Eligible Holders should tender or
refrain from tendering their Existing Notes, as applicable. Eligible
Holders must make their own decision as to whether or not to tender
their Existing Notes, as applicable, as well as with respect to the
principal amount of the Existing Notes, as applicable, to tender. The
Exchange Offers will not be made to any holders of Existing Notes, as
applicable, in any jurisdiction in which the making or acceptance
thereof would not be in compliance with the securities, blue sky or
other laws of such jurisdiction.
This press release does not constitute an offer to purchase securities
or a solicitation of an offer to sell any securities or an offer to sell
or the solicitation of an offer to purchase any new securities, nor does
it constitute an offer or solicitation in any jurisdiction in which such
offer or solicitation is unlawful.
About Intelsat
Intelsat S.A. (NYSE: I) operates the world’s first Globalized Network,
powered by its leading satellite backbone, delivering high-quality,
cost-effective video and broadband services anywhere in the world.
Intelsat’s Globalized Network combines the world’s largest satellite
backbone with terrestrial infrastructure, managed services and an open,
interoperable architecture to enable customers to drive revenue and
reach through a new generation of network services. Thousands of
organizations serving billions of people worldwide rely on Intelsat to
provide ubiquitous broadband connectivity, multi-format video
broadcasting, secure satellite communications and seamless mobility
services. The end result is an entirely new world, one that allows us to
envision the impossible, connect without boundaries and transform the
ways in which we live.
Intelsat Safe Harbor Statement
Statements in this news release, including statements regarding the
Combination, the Exchange Offers and the Consent Solicitations,
constitute “forward-looking statements” that do not directly or
exclusively relate to historical facts. When used in this release, the
words “may,” “will,” “might,” “should,” “expect,” “plan,” “anticipate,”
“project,” “believe,” “estimate,” “predict,” “intend,” “potential,”
“outlook,” and “continue,” and the negative of these terms, and other
similar expressions are intended to identify forward-looking statements
and information.
The forward-looking statements reflect Intelsat’s intentions, plans,
expectations, anticipations, projections, estimations, predictions,
assumptions and beliefs about future events and are subject to risks,
uncertainties and other factors, many of which are outside of Intelsat’s
control. Important factors that could cause actual results to differ
materially from the expectations expressed or implied in the
forward-looking statements include known and unknown risks. Known risks
include, among others, market conditions and the risks described in
Intelsat’s annual report on Form 20-F for the year ended December 31,
2016, and its other filings with the U.S. Securities and Exchange
Commission and risks and uncertainties related to our ability to
consummate the Combination, the Exchange Offers and the Consent
Solicitations, and to the occurrence of the Mandatory Jax Exchanges and
the Mandatory ICF/Lux Exchanges.
Because actual results could differ materially from Intelsat’s
intentions, plans, expectations, anticipations, projections,
estimations, predictions, assumptions and beliefs about the future, you
are urged to view all forward-looking statements with caution. Intelsat
does not undertake any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170228005777/en/
Contacts:
Intelsat
Dianne VanBeber, +1 703-559-7406
Vice President,
Investor Relations and Corporate Communications
dianne.vanbeber@intelsat.com
or
Michele
Loguidice, +1 703-559-7372
Director, Investor Relations and
Corporate Communications
michele.loguidice@intelsat.com
Source: Intelsat
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