Yum! Brands, Inc. (NYSE: YUM) today announced the expiration of and final results for its previously announced cash offers to purchase up to $550 million aggregate principal amount (the “Tender Cap”) of certain of its senior unsecured notes (the “Notes”). The terms and conditions of the tender offers are described in the Offer to Purchase, dated October 22, 2013 (the “Offer to Purchase”), and the related Letter of Transmittal. As previously announced on November 5, 2013, the Tender Cap was increased from $525 million to $550 million and the tender sub-cap applicable to the 6.875% Senior Notes due 2037 (the “2037 Notes”) was increased from $250 million to $275 million (the “Tender Sub-Cap”). The tender offers for the Notes expired at 11:59 p.m., New York City time, on Tuesday, November 19, 2013 (the “Expiration Date”). The total aggregate principal amount of Notes validly tendered at or prior to the Expiration Date and not validly withdrawn was $1,057,000,000, which exceeds the Tender Cap. In accordance with the terms of the tender offers set forth in the Offer to Purchase, Yum! Brands accepted for purchase a portion of the validly tendered 2037 Notes and 6.250% Senior Notes due 2018 (the “2018 Notes”) in an aggregate principal amount equal to the Tender Cap. Yum! Brands did not accept for purchase any 6.250% Senior Notes due 2016 (the “2016 Notes”), 5.300% Senior Notes due 2019 (the “2019 Notes”), or 4.250% Senior Notes due 2015 (the “2015 Notes”). According to information provided by D.F. King & Co., Inc., the Tender Agent and Information Agent for the tender offers, $370,872,000 aggregate principal amount of the 2037 Notes and $351,712,000 aggregate principal amount of the 2018 Notes were validly tendered at or prior to the Expiration Date and not validly withdrawn. In accordance with the terms of the tender offers Yum! Brands has accepted for purchase an aggregate of $275 million of 2037 Notes, an amount equal to the Tender Sub-Cap applicable to the 2037 Notes, and $275 million of 2018 Notes, equal to the amount of the Tender Cap available after subtracting the Tender Sub-Cap applicable to the 2037 Notes. In accordance with the terms of the tender offers, Yum! Brands has accepted only a portion of the Notes tendered by the holders of the 2037 Notes and the 2018 Notes. The proration factor applicable to the 2037 Notes was approximately 74%, determined by dividing $275 million, the Tender Sub-Cap, by the total amount of 2037 Notes tendered. The proration factor applicable to the 2018 Notes was approximately 78%, determined by dividing $275 million, the remaining portion of the Tender Cap available for purchase of Notes, by the total amount of 2018 Notes tendered. All 2037 Notes and 2018 Notes that were not accepted for purchase will be returned to holders in accordance with the Offer to Purchase. The 2016 Notes, the 2019 Notes, and the 2015 Notes that were tendered were returned to the holders in accordance with the Offer to Purchase.
|Title of Security (CUSIP Number)||Principal Amount Outstanding||Tender Sub-Cap||Acceptance Priority Level||Fixed Spread (basis points)||U.S. Treasury Reference Security||Bloomberg Reference Page||Early Tender Payment||Total Consideration||Tender Offer Consideration|
|6.875% Senior Notes due 2037 (988498 AD3)||$600,000,000||$275,000,000||1||165||2.875% U.S. Treasury Note due 05/15/2043||PX1||$50||$1,191.43||$1,141.43|
|6.250% Senior Notes due 2018 (988498 AC5)||$600,000,000||N/A||2||40||1.375% U.S. Treasury Note due 09/30/2018||PX1||$50||$1,185.94||$1,135.94|
In addition, holders whose Notes are purchased in the tender offers will be paid accrued and unpaid interest on their purchased Notes from the applicable last interest payment date up to, but not including, the payment date for such purchased Notes. The conditions to the tender offer have been satisfied; therefore, payment for the purchased Notes will be made today.Yum! Brands has retained Goldman, Sachs & Co. and J.P. Morgan Securities LLC to serve as the Lead Dealer Managers for these tender offers. Goldman, Sachs & Co. may be contacted at (800) 828-3182 (toll free) or (212) 357-0215 (collect) and J.P. Morgan Securities LLC may be contacted at (866) 834-4666 (toll free) or (212) 834-4811 (collect). Yum! Brands has also retained D.F. King & Co., Inc. to serve as the Tender Agent and the Information Agent for the tender offers. This press release is neither an offer to sell nor a solicitation of offers to buy any securities. The tender offers were made only pursuant to the Offer to Purchase and the related Letter of Transmittal. The tender offers were not made to holders of Notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. Please refer to the Offer to Purchase and related Letter of Transmittal for a description of offer terms, conditions, disclaimers, and other information applicable to the tender offers. Estimate of Earnings Charge Yum! Brands purchased $550 million aggregate principal amount of Notes in the recently completed tender offers. Due primarily to the premiums paid in connection with the purchase of these Notes, Yum! Brands is recording a pre-tax charge of approximately $120 million in the fourth quarter of 2013 within Special Items. About Yum! Brands Yum! Brands, Inc., based in Louisville, Kentucky, has over 40,000 restaurants in more than 130 countries and territories. Yum! Brands is ranked #201 on the Fortune 500 List with revenues of over $13 billion in 2012 and in 2013 was named among the top 100 Corporate Citizens by Corporate Responsibility Magazine. The Company's restaurant brands - KFC, Pizza Hut and Taco Bell - are the global leaders of the chicken, pizza and Mexican-style food categories. Outside the United States, the Yum! Brands system opened on average over five new restaurants per day in 2012, making it a leader in international retail development.