Verizon Wireless 2014 Annual Report Download - page 58

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Concurrent with the issuance of the New Notes, we entered into cross
currency swaps to x our future interest and principal payments in U.S.
dollars (see Note 10).
July Exchange Oers
On July 23, 2014, we announced the commencement of eleven sepa-
rate private oers to exchange (the July Exchange Oers) specied series
of outstanding Notes issued by Verizon and Alltel Corporation (collec-
tively, the Old Notes) for new Notes to be issued by Verizon. The July
Exchange Oers have been accounted for as a modication of debt.
2013
During March 2013, we issued $0.5 billion aggregate principal amount of
oating rate Notes due 2015 in a private placement resulting in cash pro-
ceeds of approximately $0.5 billion, net of discounts and issuance costs.
The proceeds were used for the repayment of commercial paper.
During April 2013, $1.25 billion of 5.25% Verizon Communications Notes
matured and were repaid. In addition, during June 2013, $0.5 billion of
4.375% Verizon Communications Notes matured and were repaid.
During September 2013, in connection with the Wireless Transaction,
we issued $49.0 billion aggregate principal amount of xed and oating
rate notes resulting in cash proceeds of approximately $48.7 billion,
net of discounts and issuance costs. The issuances consisted of the fol-
lowing: $2.25 billion aggregate principal amount of oating rate Notes
due 2016 that bear interest at a rate equal to three-month LIBOR plus
1.53% which rate will be reset quarterly, $1.75 billion aggregate prin-
cipal amount of oating rate Notes due 2018 that bear interest at a rate
equal to three-month LIBOR plus 1.75% which rate will be reset quar-
terly, $4.25 billion aggregate principal amount of 2.50% Notes due 2016,
$4.75 billion aggregate principal amount of 3.65% Notes due 2018, $4.0
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued
On August 21, 2014, Verizon issued $3.3 billion aggregate principal
amount of 2.625% Notes due 2020 (the 2020 New Notes), $4.5 billion
aggregate principal amount of 4.862% Notes due 2046 (the 2046 New
Notes) and $5.5 billion aggregate principal amount of 5.012% Notes due
2054 (the 2054 New Notes) in satisfaction of the exchange oer consider-
ation on tendered Old Notes (not including accrued and unpaid interest
on the Old Notes). The following tables list the series of Old Notes
included in the July Exchange Oers and the principal amount of each
such series accepted by Verizon for exchange.
billion aggregate principal amount of 4.50% Notes due 2020, $11.0 bil-
lion aggregate principal amount of 5.15% Notes due 2023, $6.0 billion
aggregate principal amount of 6.40% Notes due 2033 and $15.0 billion
aggregate principal amount of 6.55% Notes due 2043 (collectively, the
new notes). The proceeds of the new notes were used to nance, in part,
the Wireless Transaction and to pay related fees and expenses. As a result
of the issuance of the new notes, we incurred interest expense related to
the Wireless Transaction of $0.7 billion during 2013.
Bridge Credit Agreement
During September 2013, we entered into a $61.0 billion bridge credit
agreement with a group of major financial institutions. The credit
agreement provided us with the ability to borrow up to $61.0 billion to
nance, in part, the Wireless Transaction and to pay related transaction
costs. Following the September 2013 issuance of notes, borrowing avail-
ability under the bridge credit agreement was reduced to $12.0 billion.
Following the eectiveness of the term loan agreement in October 2013,
the bridge credit agreement was terminated in accordance with its terms
and as such, the related fees of $0.2 billion were recognized in Other
income and (expense), net during the fourth quarter of 2013.
The table below lists the series of Old Notes included in the July Exchange Oers for the 2020 New Notes:
(dollars in millions)
Interest
Rate Maturity
Principal Amount
Outstanding
Principal Amount
Accepted For
Exchange
Verizon Communications 3.65% 2018 $ 4,750 $ 2,052
2.50% 2016 4,250 1,068
$ 3,120
The table below lists the series of Old Notes included in the July Exchange Oers for the 2046 New Notes:
(dollars in millions)
Interest
Rate Maturity
Principal Amount
Outstanding
Principal Amount
Accepted For
Exchange
Verizon Communications 6.40% 2033 $ 6,000 $ 1,645
7.75% 2030 2,000 794
7.35% 2039 1,000 520
7.75% 2032 400 149
Alltel Corporation 7.875% 2032 700 248
6.80% 2029 300 65
$ 3,421
The table below lists the series of Old Notes included in the July Exchange Oers for the 2054 New Notes:
(dollars in millions)
Interest
Rate Maturity
Principal Amount
Outstanding
Principal Amount
Accepted For
Exchange
Verizon Communications 6.55% 2043 $ 15,000 $ 4,330
6.40% 2038 1,750 –
6.90% 2038 1,250 –
$ 4,330