USAA Capital begins consent solicitation for 2.125% notes

By Mary-Katherine Stinson

Lexington, Ky., Feb. 22 – USAA Capital Corp. launched a consent solicitation for its $400 million 2.125% fixed-rate medium-term notes, series C, due 2030, according to a press release.

The company is offering to pay each consenting holder a cash payment of $2.50 per $1,000 principal of notes.

The proposed amendment would add repurchase transactions to the types of transactions to which the negative pledge covenant does not apply.

This change will conform the note terms with the issuer's outstanding notes and other debt in order to provide flexibility with respect to future repurchase transactions entered into in the ordinary course of business by the issuer and its subsidiaries, including its banking subsidiary, USAA Federal Savings Bank.

All other terms of the notes will remain unchanged.

If approved, the proposed amendment will be binding on all holders, but only holders validly delivering consents will receive the consent fee.

To pass, holders of at least a majority in principal amount of the outstanding notes must deliver consents.

The record date is 5 p.m. ET on Feb. 21.

The consent solicitation will expire at 5 p.m. ET on March 2.

If passed it is estimated that the proposed amendments will become effective on March 6.

BofA Securities (888 292-0070, 980 387-3907) is the solicitation agent.

Global Bondholder Services Corp. (855 654-2014, 212 430-3774) is the information and tabulation agent.

USAA Capital is a San Antonio-based insurance holding company and subsidiary of United Services Automobile Association.

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