RIVERWOODS, Ill.--(BUSINESS WIRE)--Apr. 9, 2012--
Discover Financial Services (the “Company”) (NYSE:DFS) announced today
the commencement of private offers to exchange its outstanding notes as
set forth in the table below (collectively, the “Old Notes”) for new
Senior Notes due 2022 (the “New Notes”) and cash (the “Exchange Offers”).
The Exchange Offers are being conducted by the Company upon the terms
and subject to the conditions set forth in a confidential offering
memorandum, dated April 9, 2012, and related letter of transmittal. The
Exchange Offers are only extended, and copies of the offering documents
will only be made available, to a holder of Old Notes that has certified
its status as (1) a “qualified institutional buyer” as defined in Rule
144A under the Securities Act of 1933 (the “Securities Act”) or (2) (A)
a person who is not a “U.S. person” as defined in Regulation S under the
Securities Act and (B) if resident and/or located in any Member State of
the European Economic Area which has implemented provisions of the
Directive 2003/71/EC (as amended, including pursuant to Directive
2010/73/EU, the “Prospectus Directive”), a qualified investor as defined
in Article 2.1(e) of the Prospectus Directive (each, an “Eligible
Holder”).
The following table sets forth the Old Notes that are subject to the
Exchange Offers:
|
|
CUSIP
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Title of
|
|
|
Principal Amount
|
|
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Maximum
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|
|
Number
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|
|
Security
|
|
|
Outstanding
|
|
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Acceptance Limit
|
|
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254709AE8
|
|
|
10.250% Senior
|
|
|
$400,000,000
|
|
|
N/A
|
|
|
|
|
|
Notes due 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
254709AD0
|
|
|
6.450% Senior
|
|
|
$400,000,000
|
|
|
$50,000,000
|
|
|
254709AB4
|
|
|
Notes due 2017
|
|
|
|
|
|
|
Upon the terms and subject to the conditions of the Exchange Offers, the
Company will make offers to Eligible Holders:
-
to exchange any and all outstanding 10.250% Senior Notes due 2019 of
the Company (the “10.250% Notes”) for New Notes and cash (such offer,
the “10.250% Notes Exchange Offer”) and
-
to exchange outstanding 6.450% Senior Notes due 2017 of the Company
(the “6.450% Notes”) for New Notes and cash up to an aggregate
principal amount equal to the lesser of (i) $50 million and (ii) the
difference between $250 million and the aggregate principal amount of
New Notes issued pursuant to the 10.250% Notes Exchange Offer (the
“6.450% Notes Exchange Offer Cap”) (such offer, the “6.450% Notes
Exchange Offer”).
The Company will only accept validly tendered 6.450% Notes if less than
$250 million aggregate principal amount of New Notes are issuable
pursuant to the 10.250% Notes Exchange Offer. In the event that $250
million aggregate principal amount or more of New Notes are issuable
pursuant to the 10.250% Notes Exchange Offer, none of the 6.450% Notes
will be accepted for exchange pursuant to the 6.450% Notes Exchange
Offer. If the Company accepts any 6.450% Notes and if an aggregate
principal amount of the 6.450% Notes is validly tendered and not validly
withdrawn in excess of the 6.450% Notes Exchange Offer Cap, the Company
will accept for exchange only an aggregate principal amount of the
6.450% Notes not to exceed the 6.450% Notes Exchange Offer Cap on a pro
rata basis, as described in the confidential offering memorandum.
The Exchange Offers are subject to certain conditions, including the
requirement that a minimum of $250 million aggregate principal amount of
New Notes be issued in exchange for Old Notes validly tendered and not
validly withdrawn.
Eligible Holders who validly tender and who do not validly withdraw
their Old Notes prior to 5:00 p.m., New York City time, on April 20,
2012, subject to any extension by the Company, will receive an early
exchange premium equal to $50 per $1,000 principal amount of Old Notes.
The Exchange Offers will expire at 11:59 p.m., New York City time,
on May 4, 2012, unless extended or earlier terminated by the Company.
Tenders of Old Notes in the Exchange Offers may be validly withdrawn at
any time prior to 5:00 p.m., New York City time, on April 20, 2012,
subject to extension by the Company, but not thereafter, except in
certain limited circumstances where additional withdrawal rights are
required by law.
The New Notes will not be registered under the Securities Act or any
state securities laws. Therefore, the New Notes may not be offered or
sold in the United States absent registration or an applicable exemption
from the registration requirements of the Securities Act and any
applicable state securities laws. The Company will enter into a
registration rights agreement with respect to the New Notes.
Documents relating to the Exchange Offers will only be distributed to
holders of the Old Notes that complete and return a letter of
eligibility confirming that they are Eligible Holders. Holders of the
Old Notes that desire a copy of the eligibility letter may contact D.F.
King & Co., Inc., the information agent for the Exchange Offers, by
calling toll-free (800) 848-3416 or at (212) 269-5550 (banks and
brokerage firms).
This press release is not an offer to sell or a solicitation of an
offer to buy any security. The Exchange Offers are being made solely by
the confidential offering memorandum and related letter of transmittal
and only to such persons and in such jurisdictions as is permitted under
applicable law.
This press release contains certain statements that are forward-looking
within the meaning of the Private Securities Litigation Reform Act of
1995. These statements are not guarantees of future performance and
involve certain risks, uncertainties and assumptions that are difficult
to predict. Actual outcomes and results may differ materially from those
expressed in, or implied by, the Company’s forward-looking statements.
Words such as “expects,” “anticipates,” believes,” “estimates” and other
similar expressions or future or conditional verbs such as “will,”
“should,” “would” and “could” are intended to identify such
forward-looking statements. Forward-looking statements speak only as of
the date of this press release, and the Company undertakes no obligation
to update any forward-looking statement.
Source: Discover Financial Services
Discover Financial Services
Investors:
William
Franklin, 224-405-1902
williamfranklin@discover.com
or
Media:
Jon
Drummond, 224-405-1888
jondrummond@discover.com