defa14a
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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Filed by the Registrant
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Filed by a Party other than the registrant
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Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to § 240.14a-12 |
Broadwing Corporation
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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Title of each class of securities to which transaction applies: N/A |
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Aggregate number of securities to which transaction applies: N/A |
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was
determined): N/A |
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Proposed maximum aggregate value of transaction: N/A |
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Fee paid previously with preliminary materials. |
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Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the form or schedule and the
date of its filing. |
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Amount previously paid: N/A |
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Form, Schedule or Registration Statement No.: N/A |
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Date Filed: N/A |
The following letter was sent to employees of Broadwing Corporation in connection with the proposed
acquisition of Broadwing by Level 3 Communications, Inc.
October 17, 2006
Dear Broadwing Employee,
As you know, there has been a wave of telecommunications Mergers and Acquisition activity this
year. Recently, many strong companies have combined in order to seek to improve their
competitiveness, accelerate market share growth, and capitalize on advances in technology. We have
seen this with both small transactions such as PacTecs acquisition of US-LEC and with larger
transactions like ATTs proposed acquisition of BellSouth Corporation. As a result, we believe
that progress in the U.S. telecommunications industry is increasingly defined by operators with
sufficient scale.
Today we announced that Broadwing Communications has entered into a definitive agreement to be
purchased by Level 3 Communications. The transaction is valued at a premium to Broadwings current
market capitalization which is good news for Broadwing shareholders. For Broadwing employees, we
believe that the combination of the two companies will produce a powerful operator with the scale
to compete in the global telecommunications arena.
We anticipate that some of the key benefits of the combination will include:
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The combined companies will enjoy an enhanced competitive position that we believe will
create additional long-term value for customers, employees, and investors. |
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The combined company will have improved buyer power and leverage to affect reductions
in access, equipment and third-party network costs, each of which is a major cost for both
companies. |
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The combined network footprint and product set (which includes voice and data, plus
metro, long haul and media transport) will bolster market position both domestically and
internationally where Level 3 has a substantial facilities-based presence. |
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The combined company will have increased ability to invest and innovate to meet the
markets evolving needs. |
For these reasons, the Broadwing Board and I believe that this option is the best currently
available choice for the business. We therefore endorse this option which is subject to
shareholder vote and approval.
I know you all have many questions regarding how this will affect you and the company both short
and long term. These answers will be forthcoming in subsequent communications. However, by virtue
of this acquisition, Level 3 acquires a well established and growing carrier and enterprise market
business with a strong customer base, solid network, proven products and a talented pool of
professionals. You are the core of this business, the basis of its value and the reason for its
attractiveness. So, please keep this in mind during this brief period of uncertainty.
My staff and I pledge to communicate as quickly and comprehensively as possible Human Resources
is compiling a list of anticipated questions and answers which we will distribute later today. I
will be holding a conference call with my direct reports later this morning and they in turn will
brief you on the material covered on that call. A subsequent email will provide talking points for
customer-facing employees.
In the meantime, I request your patience and continued focus on our customers and our business.
Steve Courter Broadwing CEO
IMPORTANT INFORMATION:
This document contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to,
(i) statements about the benefits of the acquisition of Broadwing by Level 3, including financial
and operating results, synergy benefits and any accretion to reported earnings that may be realized
from the acquisition; Level 3s and Broadwings plans, objectives, expectations and intentions and
other statements contained in this document that are not historical facts; and (ii) other
statements identified by words such as expects, anticipates, intends, plans, believes,
seeks, estimates or words of similar meaning. These forward-looking statements are based upon
managements current beliefs or expectations and are inherently subject to significant business,
economic and competitive uncertainties and contingencies and third-party approvals, many of which
are beyond our control. The following factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements: (1) whether the stockholders of
Broadwing approve the proposed transaction; (2) the satisfaction of the other conditions specified
in the merger agreement, including without limitation the receipt of required governmental
approvals of the proposed transaction; (3) the ability to successfully combine the businesses of
Level 3 and Broadwing; (4) the realization of revenue and cost synergy benefits from the proposed
transaction; and (5) operating costs, customer loss and business disruption following the merger,
including adverse effects on relationships with employees. Other important factors that may
affect Level 3s and the combined business results of operations and financial condition include,
but are not limited to: increasing the volume of traffic on Level 3s network; developing new
products and services that meet customer demands and generate acceptable margins; successfully
completing commercial testing of new technology and information systems to support new products and
services, including voice transmission services; stabilizing or reducing the rate of price
compression on certain of our communications services; integrating strategic acquisitions including
the acquisition of Broadwing; attracting and retaining qualified management and other personnel;
and the ability to meet all of the terms and conditions of our debt obligations. Level 3s Annual
Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K
and other Securities and Exchange Commission filings discuss the foregoing risks as well as other
important risk factors that could contribute to such differences or otherwise affect our business,
results of operations and financial condition. The forward-looking statements in this document
speak only as of the date they are made. Level 3 and Broadwing do not undertake any obligation to
update any forward-looking statement to reflect circumstances or events that occur after the date
such forward-looking statement is made.
This document shall not constitute an offer of any securities for sale. The proposed transaction
will be submitted to Broadwings stockholders for their consideration. Level 3 and Broadwing will
file a registration statement, a proxy statement/prospectus and other relevant documents concerning
the proposed transaction with the SEC. Stockholders of Broadwing are urged to read the registration
statement and the proxy statement/prospectus and any other relevant documents filed with the SEC
when they become available, as well as any amendments or supplements to those documents, because
they will contain important information. Stockholders of Level 3 can obtain more information about
the proposed transaction by reviewing the Form 8-K to be filed by Level 3 in connection with the
announcement of the transaction, and any other relevant documents filed with the SEC when they
become available. You will be able to obtain a free copy of the proxy statement/prospectus, as well
as other filings containing information about Level 3 and Broadwing, at the SECs Web site
(http://www.sec.gov). Copies of the proxy statement/prospectus and the SEC filings that will be
incorporated by reference in the proxy statement/prospectus can be obtained, without charge, by
directing a request to Level 3, Investor Relations, 1025 Eldorado Blvd., Broomfield, CO 80021,
720-888-2500 or to Broadwing, Investor Relations, 1122 Capital of Texas Highway South Austin, TX
78746-6426, (866) 426-7847.
Level 3, Broadwing and their respective directors and executive officers may be deemed to be
participants in the solicitation of proxies from the stockholders of Broadwing in connection with
the proposed transaction. Information about the directors and executive officers of Level 3 is set
forth in the proxy statement on Schedule 14A, dated April 6, 2006, as supplemented, for Level 3s
2006 annual meeting of stockholders. Information about directors and executive officers of
Broadwing and their ownership of Broadwing common stock is set forth in the proxy statement on
Schedule 14A, dated March
24, 2006, for Broadwings 2006 annual meeting of stockholders. Additional information regarding
participants in the proxy solicitation may be obtained by reading the proxy statement/prospectus
regarding the proposed transaction when it becomes available.