Level 3 Announces $2 Billion Tranche B 2022 Term Loan

Level 3 Communications’ wholly owned subsidiary, Level 3 Financing, Inc., has received commitments from lenders to increase the borrowings under its existing senior secured credit facility through the creation of a new $2 billion Tranche B 2022 Term Loan (the “Tranche B 2022 Term Loan”).

Level 3 Financing will amend and restate its existing senior secured credit facility to include the new Tranche B 2022 Term Loan, which will mature on January 31, 2022. Interest on the Tranche B 2022 Term Loan will be equal to LIBOR plus 3.5 percent with LIBOR set at a minimum of 1.0 percent. The Tranche B 2022 Term Loan was priced at 99.25 percent of par.

The net proceeds of the Tranche B 2022 Term Loan to Level 3 Financing will be used to finance the cash portion of the merger consideration payable to tw telecom inc. stockholders pursuant to the pending acquisition of tw telecom inc., and to refinance certain existing indebtedness of tw telecom inc., including fees and premiums, in connection with the closing of that acquisition.

Level 3 Financing expects the closing of the Tranche B 2022 Term Loan will take place with the closing of the pending acquisition of tw telecom inc., subject to the execution of definitive documents and customary closing conditions.

“We’re pleased that with this transaction, our financing requirements related to the tw telecom transaction have been satisfied,” said Sunit Patel, executive vice president and CFO of Level 3. “Additionally, Level 3 has received all necessary approvals from the various U.S. state public utility commissions for the completion of the tw telecom transaction and related borrowings. We continue to be excited about the acquisition and look forward to closing the transaction this quarter.”

Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc., Morgan Stanley Senior Funding, Inc., Barclays Bank PLC, Goldman Sachs BankUSA, Jefferies Finance LLC and JP Morgan Securities LLC are acting as Joint Lead Arrangers and Joint Bookrunning Managers for the Tranche B 2022 Term Loan. Willkie Farr & Gallagher LLP is acting as counsel to Level 3 and Cravath Swaine & Moore LLP is acting as counsel to the Joint Lead Arrangers and Joint Bookrunning Managers.