CHATTANOOGA, TN. (May 11, 2006) - UnumProvident Corporation (NYSE: UNM), announced today that it has commenced an offer to purchase for cash (the "Offer") up to $300 million aggregate principal and liquidation amount of its outstanding debt and capital securities (the "Securities"). The terms and conditions of the Offer are set forth in the Offer to Purchase dated May 11, 2006 (the "Offer to Purchase").
|
Cusip |
Title of Security |
Aggregate Principal Amount/Liquidation Amount Outstanding |
Reference U.S. Treasury Security |
Bloomberg Reference Page |
Fixed Spread (basis points) |
Acceptance Priority Level |
|
743863AA0 |
7.405% Capital Securities due March 15, 2038
|
$300,000,000 |
5.375% U.S. Treasury Bond due 2/15/2031 |
PX8 |
265 |
1 Maximum of $50,000,000 |
|
91529YAC0 |
7.625% Senior Notes due March 1, 2011
|
$575,000,000 |
4.50% U.S. Treasury Bond due 2/28/2011 |
PX6 |
95 |
2 |
|
743862AA2 |
7.25% Senior Notes due March 15, 2028
|
$200,000,000 |
5.375% U.S. Treasury Bond due 2/15/31 |
PX8 |
195 |
3 |
|
903192AA0 |
6.75% Notes due December 15 , 2028 |
$250,000,000 |
5.375% U.S. Treasury Bond due 2/15/31
|
PX8 |
190 |
4 |
|
91529YAD8 |
7.375% Senior Notes due June 15, 2032
|
$250,000,000 |
5.375% U.S. Treasury Bond due 2/15/31 |
PX8 |
195 |
5 |
|
743862AD6 |
7% Senior Notes due July 15, 2018 |
$200,000,000 |
4.50% U.S. Treasury Note due 2/15/2016 |
PX7 |
170 |
6 |
The amounts of each series of securities that are purchased in the Offer will be determined in accordance with the priorities identified in the column "Acceptance Priority Level" in the table above, and in the case of the 7.405% Capital Securities due March 15, 2038 will be limited to $50,000,000 liquidation amount. The amount of Securities that is purchased may be prorated as set forth in the Offer to Purchase.
In the event that the aggregate amount tendered exceeds the Maximum Tender Amount, UnumProvident will accept for payment only the Maximum Tender Amount and the Securities will be purchased in accordance with the Acceptance Priority Level (in numerical priority order) listed in the table above. All Securities tendered in the Offer having a higher Acceptance Priority Level will be accepted for purchase before any tendered Securities having a lower Acceptance Priority Level are accepted for purchase. For example, all tendered Notes having Acceptance Priority Level "2" will be accepted before any tendered Notes having Acceptance Priority Level "3" will be accepted. If there are sufficient remaining funds to purchase some, but not all of the Securities of a series of an applicable Acceptance Priority Level, the amount of Securities purchased in that series will be prorated based on the aggregate principal or liquidation amount tendered in the Offer with respect to that series of Securities. In that event, Securities of any other series subject to the Offer with a lower Acceptance Priority Level than the prorated series of Securities will not be accepted for purchase.
Holders of Securities that are validly tendered and not validly withdrawn before 5:00 p.m., New York City time, on May 24, 2006 (the "Early Tender Date") and accepted for payment will receive the Full Tender Offer Consideration. Holders of Securities that are validly tendered after 5:00 p.m., New York City time, on the Early Tender Date and not withdrawn before 9:00 a.m., New York City time, on June 9, 2006 (the "Expiration Date") and accepted for purchase will receive the Full Tender Offer Consideration minus an amount in cash equal to $50 for each $1,000 principal or liquidation amount, as applicable, of Securities (the "Late Tender Offer Consideration").
The Full Tender Offer Consideration for each $1,000 principal or liquidation amount of Securities tendered pursuant to the Offer will be equal to the price that results in a yield to maturity equal to (1) the yield to maturity on the applicable reference United States Treasury identified in the list above, as measured at 2 p.m., New York City time, on June 7, 2006, plus (2) the fixed spread, listed above, for the security. Payments will include accrued and unpaid interest or distributions, as the case may be, up to, but not including, the date of payment of the applicable tender offer consideration.
The Offer is scheduled to expire at 9:00 a.m., New York City time, on the Expiration Date, unless extended or earlier terminated. The Offer is not subject to the receipt of any minimum amount of tenders.
This press release is neither an offer to purchase, nor a solicitation for acceptance of the offer. UnumProvident is making the offer only by, and pursuant to the terms of, the Offer to Purchase. The complete terms and conditions of the Offer is set forth in the Offer to Purchase and related letter of transmittal (the "Letter of Transmittal") that is being sent to holders of Securities. Holders are urged to read the tender offer documents carefully when they become available. Copies of the Offer to Purchase and Letter of Transmittal may be obtained from the Information Agent for the Offers, Global Bondholder Services Corporation, at 866-470-3600 (US toll-free) and 212-430-3774 (collect).
Goldman, Sachs & Co. is the Dealer Manager for the Offers. Questions regarding the Offers may be directed to Goldman, Sachs & Co., Credit Liability Management Group, (800) 828-3182 (toll-free) and (212) 357-7867 (collect).
ABOUT UNUMPROVIDENT
UnumProvident is the largest provider of group and individual income protection insurance in the United States and United Kingdom. Through its subsidiaries, UnumProvident insures more than 21 million people and provided $6 billion in total benefits to customers in 2005. With primary offices in Chattanooga, Tennessee, and Portland, Maine, UnumProvident employs approximately 12,000 people worldwide. For more information, visit www.unumprovident.com.
SAFE HARBOR STATEMENT
A "safe harbor" is provided for "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. Statements in this press release, which are not historical facts, are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. These risks and uncertainties include such general matters as general economic or business conditions; events or consequences relating to terrorism and acts of war; competitive factors, including pricing pressures; legislative, regulatory, or tax changes; and the interest rate environment. More specifically, they include fluctuations in insurance reserve liabilities, projected new sales and renewals, persistency rates, incidence and recovery rates, pricing and underwriting projections and experience, retained risks in reinsurance operations, availability and cost of reinsurance, level and results of litigation, rating agency actions, regulatory actions and investigations, negative media attention, the level of pension benefit costs and funding, investment results, including credit deterioration of investments, and effectiveness of product and customer support. For further information of risks and uncertainties that could affect actual results, see the sections entitled "Cautionary Statement Regarding Forward-Looking Statements" and "Risk Factors" in UnumProvident´s Form 10-K for the fiscal year ended December 31, 2005, and subsequently filed Form 10-Q. The forward-looking statements are being made as of the date of this press release and UnumProvident expressly disclaims any obligation to update any forward-looking statement contained herein.
For additional information, contact:
Thomas A. H. White
Senior Vice President, Investor Relations
423.294.8996
Jim Sabourin
Vice President, Corporate Communications
423.294.6043