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THE SEAGRAM COMPANY LTD. AND JOSEPH E. SEAGRAM & SONS, INC. ANNOUNCE
CASH TENDER OFFERS AND CONSENT SOLICITATIONS FOR DEBT SECURITIES
MONTREAL and NEW YORK, October 31, 2000---The Seagram Company Ltd.
(SCL) and Joseph E. Seagram & Sons, Inc. (JES) today announced that they are
commencing cash tender offers and consent solicitations for certain of their
outstanding debt securities.
The tender offers and consent solicitations by SCL are for its 6.50%
Debentures due April 1, 2003, 8.35% Debentures due November 15, 2006, 8.35%
Debentures due January 15, 2022 and 6.875% Debentures due September 1, 2023
(collectively, the "SCL Debentures").
The tender offers and consent solicitations by JES are for its 5.79%
Senior Notes due 2001, 6.250% Senior Notes due 2001, 6.400% Senior Notes due
2003, 6.625% Senior Notes due 2005, 8 3/8% Guaranteed Debentures due February
15, 2007, 7% Guaranteed Debentures due April 15, 2008, 6.800% Senior Notes due
2008, 8 7/8% Guaranteed Debentures due September 15, 2011, 9.65% Guaranteed
Debentures due August 15, 2018, 7.500% Senior Debentures due 2018, 9% Guaranteed
Debentures due August 15, 2021 and 7.600% Senior Debentures due 2028
(collectively, the "JES Debentures", and together with the SCL Debentures, the
"Debentures"), each of which has been guaranteed as to payment of principal and
interest by SCL.
The tender offer with respect to each series of Debentures will expire
at 5:00 p.m., New York City time, on December 12, 2000, unless the offer is
extended (as the same may be extended, the "expiration date"). In order to be
eligible to receive the consent payment, holders of Debentures must tender their
Debentures and deliver their consents to the proposed amendments on or prior to
5:00 p.m., New York City time, on November 14, 2000, unless extended by us with
respect to such series (as the same may be extended, the "consent date").
Tendered Debentures may be withdrawn and consents may be revoked at any time
prior to 5:00 p.m., New York City time, on the consent date for such series of
Debentures but not thereafter.
Holders who desire to tender their Debentures pursuant to the tender
offers must consent to the proposed amendments and holders may not deliver
consents without tendering the related Debentures. Holders may not revoke
consents without withdrawing the Debentures tendered pursuant to the tender
offers.
The tender offers and consent solicitations are being made in
connection with the pending combination of Vivendi, SCL and CANAL +. The tender
offer and consent solicitation for each series of Debentures is conditioned
upon, among other things, the completion of such combination and related
transactions and the receipt of the requisite consents to adopt amendments to
the Debentures and the Indentures pursuant to which they were issued.
The total purchase price SCL and JES are offering for each series of
SCL Debentures and JES Debentures, respectively, will be calculated on the
second business day before such tender
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offer expires using a yield equal to a fixed spread plus the yield to maturity
of a U.S. Treasury bond with a maturity date that is close to the maturity date
of such series of Debentures. This price is referred to as the total purchase
price. SCL and JES expect that the total purchase price for the Debentures will
be fixed on December 8, 2000, when the yield on the reference U.S. Treasury
bonds will be determined (or, if a tender offer is extended, the second business
day prior to the expiration date).
The fixed spread and the U.S. Treasury reference bond being used with
respect to each series of Debentures are specified in the chart below.
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SCL DEBENTURES
<TABLE>
<CAPTION>
Consent
Payment Fixed
(per $1000 Spread
Outstanding U.S. Treasury principal (in basis
Series of Debentures Principal Amount Maturity Date Reference Bond amount) points)
-------------------- ----------------- ------------- -------------- ------- -------
<S> <C> <C> <C> <C> <C>
6.50% Debentures due $200,000,000 April 1, 5.750% U.S. Treasury $10.00 + 40.0 bp
April 1, 2003 2003 Note due August 15,
2003
8.35% Debentures due $200,000,000 November 15, 6.750% U.S. Treasury $15.00 + 60.0 bp
November 15, 2006 2006 Note due May 15, 2005
8.35% Debentures due $200,000,000 January 15, 6.125% U.S. Treasury $35.00 + 85.0 bp
January 15, 2022 2022 Note due August 15,
2029
6.875% Debentures due $200,000,000 September 1, 6.125% U.S. Treasury $35.00 + 85.0 bp
September 1, 2023 2023 Note due August 15,
2029
</TABLE>
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JES DEBENTURES
<TABLE>
<CAPTION>
Consent
Payment Fixed
Outstanding (per $1000 Spread
Principal U.S. Treasury principal (in basis
Series of Debentures Amount Maturity Date Reference Bond amount) points)
-------------------- ------ ------------- -------------- ------- -------
<S> <C> <C> <C> <C> <C>
5.79% Senior Notes $250,000,000 April 15, 2001 6.250% U.S. Treasury $2.00 + 30.0 bp
due 2001 Note due April 30, 2001
6.250% Senior Notes $600,000,000 December 15, 5.875% U.S. Treasury $5.00 + 30.0 bp
due 2001 2001 Note due November 30,
2001
6.400% Senior Notes $400,000,000 December 15, 5.750% U.S. Treasury $10.00 + 40.0 bp
due 2003 2003 Note due August 15,
2003
6.625% Senior Notes $475,000,000 December 15, 6.750% U.S. Treasury $15.00 + 55.0 bp
due 2005 2005 Note due May 15, 2005
8 3/8% Debentures $200,000,000 February 15, 6.750% U.S. Treasury $18.00 + 65.0 bp
due February 15, 2007 2007 Note due May 15, 2005
7% Guaranteed Debentures due $200,000,000 April 15, 2008 5.750% U.S. Treasury $20.00 + 70.0 bp
April 15, 2008 Note due August 15,
2010
6.800% Senior Notes $450,000,000 December 15, 5.750% U.S. Treasury $20.00 + 70.0 bp
due 2008 2008 Note due August 15,
2010
8 7/8% Guaranteed Debentures $225,000,000 September 15, 5.750% U.S. Treasury $25.00 + 75.0 bp
due September 15, 2011 2011 Note due August 15,
2010
9.65% Senior Debentures $250,000,000 August 15, 6.125% U.S. Treasury $35.00 + 85.0 bp
due August 15, 2018 2018 Note due August 15,
2029
7.500% Guaranteed Debentures $875,000,000 December 15, 6.125% U.S. Treasury $35.00 + 85.0 bp
due, 2018 2018 Note due August 15,
2029
9% Guaranteed Debentures $200,000,000 August 15, 6.125% U.S. Treasury $35.00 + 85.0 bp
due August 15, 2021 2021 Note due August 15,
2029
7.600% Senior Debentures $700,000,000 December 15, 6.125% U.S. Treasury $40.00 + 90.0 bp
due 2028 2028 Note due August 15,
2029
</TABLE>
In addition, tendering holders whose Debentures are accepted for payment
pursuant to the offers will receive accrued and unpaid interest to but not
including the date of payment.
In conjunction with the tender offers, SCL and JES are seeking consents
to proposed amendments to the Debentures and the Indentures pursuant to which
they were issued and they have each designated a portion of the total purchase
price of each series of Debentures as a consent payment. The consent payment
with respect to each series of Debentures is set forth in the table above. The
consent payment will be made only if the offers are consummated. If the offers
are consummated, holders who have validly tendered their Debentures prior to the
consent date and who have not withdrawn their tender and revoked their consent
prior to 5:00 p.m., New
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York City time, on the consent date will be paid the total purchase price
(including the consent payment) for their Debentures. If the offers are
consummated, holders who have validly tendered their Debentures after the
consent date will be paid the total purchase price less the consent payment.
The proposed amendments would (a) eliminate substantially all of the
covenants in the Indentures other than the covenants requiring payment of
interest on and principal of the Debentures when due and requiring the
maintenance of an office for purposes of making payments on the Debentures, (b)
eliminate Events of Default under the Indentures relating to defaults on
bankruptcy and insolvency, (c) eliminate the limitations in the Indentures on
consolidation, merger, conveyance and transfers, (d) in the case of certain of
the Debentures and Indentures, modify certain repurchase and defeasance
provisions and (e) eliminate the contractual requirement for filing periodic
reports with the SEC. Adoption of the proposed amendments for each series of
Debentures requires the consent of holders of at least a majority of such
series, except in the case of the 9.65% Guaranteed Debentures due August 15,
2018 and the 9% Guaranteed Debentures due August 15, 2021, with respect to which
consents to the proposed amendments from holders representing at least a
majority of the principal amount of such series of Debentures and the 8 7/8%
Guaranteed Debentures due September 15, 2011, voting together as one class, are
required to approve the proposed amendments with respect to such series of
Debentures.
Banc of America Securities LLC and Salomon Smith Barney are acting as
the dealer managers for the tender offers and consent solicitations. The
information agent and the depositary for the tender offers and consent
solicitations is ChaseMellon Shareholder Services, L.L.C. The tender offers and
consent solicitations are being made pursuant to Offers to Purchase and Consent
Solicitation and related Letters of Transmittal and Consent, which more fully
set forth the terms of the tender offers and consent solicitations.
This press release shall not constitute an offer to purchase or a
solicitation of acceptances of the tender offers and the consent solicitation,
which may only be made pursuant to the terms of the relevant Offer to Purchase
and Consent Solicitation and related Letter of Transmittal and Consent.
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Additional information concerning the terms of the tender offers and
consent solicitations may be obtained from Banc of America Securities LLC at
(866) 475-9886 (toll free) or (704) 388-8853 (collect) or from Salomon Smith
Barney, Liability Management Group, at (800) 558-3745. Copies of the Offers to
Purchase and Consent Solicitation and related documents may be obtained from
ChaseMellon Shareholder Services, L.L.C., the information agent, at (866)
293-6618.
The Seagram Company Ltd., headquartered in Montreal, operates in four
global business segments: Music, Filmed Entertainment, Recreation and Other, and
Spirits and Wine. Universal Music Group, produces, markets and distributes
recorded music throughout the world in all major genres, and it is engaged in
music publishing. The Company's Filmed Entertainment business produces and
distributes motion picture, television and home video products worldwide;
operates and has ownership in a number of international cable channels; and
engages in the licensing of merchandising rights and film property rights. The
Recreation and Other business operates theme parks and retail stores. It is also
involved in the development of entertainment software. The Spirits and Wine
business is engaged principally in the production and marketing of distilled
spirits, wines, coolers, beers and mixers throughout more than 190 countries and
territories.
This release contains forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on management's current expectations or beliefs
and are subject to a number of factors and uncertainties that could cause actual
results to differ materially from those described in the forward-looking
statements. The forward-looking statements contained in this release address the
business combination of Vivendi, Canal+ and Seagram. The following factors,
among others, could cause actual results to differ materially from those
described in the forward-looking statements: the risk that the Vivendi, Canal+
and Seagram businesses will not be integrated successfully; costs related to the
combination, failure of vivendi, Canal+ and Seagram shareholders to approve the
combination or delays in the completion of the combination and related
transactions; inability to further identify, develop and achieve success for new
products, services and technologies; increased competition and its effect on
pricing, spending, third-party relationships and revenues; inability to
establish ad maintain relationships with commerce, advertising, marketing,
technology, and content providers. None of Vivendi, Canal+ or Seagram undertakes
any obligation to provide updates or to revise any forward-looking statements.
Investors and security holders are urged to read the joint proxy
statement/prospectus regarding the business combination transaction referenced
in the foregoing information, when it becomes available, because it will contain
important information. The joint proxy statement/prospectus has been filed with
the U.S. Securities and Exchange Commission by Vivendi, Canal+ and Seagram.
Investors and security holders may obtain a free copy of the joint proxy
statement/prospectus (when it is available) and other documents filed by
Vivendi, Canal+ and Seagram with the Commission at the Commission's web site at
www.sec.gov. The joint proxy statement/prospectus and these other documents may
also be obtained for free from Vivendi, Canal+ and Seagram. Information
regarding the participants in the proxy solicitation and a description of their
direct and indirect interest, by security holdings or otherwise, is contained in
the joint press release relating to the transaction filed with the Commission by
each of Vivendi and Seagram, on June 20, 2000.
