DBRS Rates Level 3’s Notes Issue CCC, Stable Trend

DBRS has today assigned a rating of CCC with a recovery rating of RR6 to Level 3 Communications Inc.’s (Level 3 or the Company) Convertible Senior Notes issue that was completed today. The trend is Stable.

The notes issue consists of $373.8 million of 15% Convertible Senior Notes that mature on January 15, 2013. The notes are convertible by the holders into shares of Level 3 common stock at an initial conversion price of $1.80 per share at any time before they mature. The notes are unsecured and unsubordinated obligations and rank equally to Level 3’s existing and future unsecured and unsubordinated debt.

DBRS notes that the proceeds from this issue will be used to fund its debt tender offers (two completed on December 22, 2008, while one has been extended to December 30, 2008 and remains outstanding), for acquisitions, to enhance liquidity and for general corporate purposes.

Note:
All figures are in U.S. dollars unless otherwise noted.

The applicable methodology is Rating Telecommunications which can be found on our website under Methodologies.

This is a Corporate rating.