USAA Capital Corporation Announces Commencement of Consent Solicitation

SAN ANTONIO, Feb. 22, 2023 /PRNewswire/ -- USAA Capital Corporation (the "Issuer") today announced the commencement of a consent solicitation relating to the 2.125% Fixed Rate Medium-Term Notes, Series C due 2030 (the "Notes") which were issued by the Issuer. As of the record date referred to below, there was $400,000,000 in aggregate principal amount of Notes outstanding.

The consent solicitation will expire at 5:00 p.m., New York City time, on March 2, 2023 unless extended or earlier terminated (the "Expiration Date"). It is subject to the terms and conditions set forth in the consent solicitation statement, dated February 22, 2023, including receipt of consents from holders of record as of 5:00 p.m., New York City time, on February 21, 2023 of at least a majority in principal amount of the outstanding Notes.

Subject to the terms and conditions of the consent solicitation, the Issuer is offering to pay each holder who validly delivers (and does not validly revoke) its consent prior to the Expiration Date a cash payment of $2.50 per $1,000 principal amount of Notes in respect of which a consent has been delivered (the "Consent Fee"). No Consent Fee will be paid if the consent solicitation is terminated for any reason prior to the Expiration Date, the requisite consents are not obtained prior to the Expiration Date or if the other conditions to the consent solicitation are not satisfied or waived.

The proposed amendment to the Notes would add repurchase transactions to the types of transactions to which the negative pledge covenant set forth in the Notes does not apply. This change will conform the terms of the Notes with the Issuer's outstanding notes and other indebtedness in order to provide flexibility with respect to future repurchase or "repo" transactions entered into in the ordinary course of business by the Issuer and its subsidiaries, including the Issuer's banking subsidiary, USAA Federal Savings Bank. The proposed amendment would therefore provide the Issuer with additional financial flexibility for liquidity management. All other terms of the Notes will remain unchanged. If approved, the proposed amendment will be binding on all holders and only holders validly delivering consents (which are not validly revoked) will receive the Consent Fee.

Holders of the Notes may revoke their consents at any time prior to the Expiration Date or, if earlier, the Effective Time. The Effective Time means the first time at which valid consents in respect of a majority in principal amount of the outstanding Notes to approve the proposed amendment have been received by the Issuer and have not prior to such time been revoked. If adopted, non-consenting holders of Notes will be bound by the amendment to the Notes but will not receive the Consent Fee. If the requisite consents are obtained by the Expiration Date, the Issuer expects that the proposed amendment to the Notes will become effective on March 6, 2023.

For a complete statement of the terms and conditions of the consent solicitation, holders of the Notes should refer to the consent solicitation statement, dated as of February 22, 2023. The Issuer may terminate, extend or amend the consent solicitation at any time.

The Solicitation Agent in connection with the consent solicitation is BofA Securities. Questions regarding the consent solicitation may be directed to BofA Securities, Attention: Liability Management at (888) 292-0070 (toll free) or (980) 387-3907 (collect). Global Bondholder Services Corporation is serving as Information Agent and Tabulation Agent in connection with the consent solicitation. Requests for assistance in delivering consents or for additional copies of the consent solicitation statement should be directed to the Information Agent at (855) 654-2014 (toll free) or (212) 430-3774 (banks and brokers) (collect).

This announcement is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of consents with respect to any securities, including the Notes. The consent solicitation is being made solely by the consent solicitation statement and is subject to the terms and conditions stated therein. No recommendation is made, or has been authorized to be made, as to whether or not holders of the Notes should consent to the adoption of the proposed amendment. The Issuer reserves the right, in its sole discretion, to terminate or modify the consent solicitation. 

About USAA Capital Corporation

The Issuer is a Delaware corporation organized in December 1985 and is a direct wholly-owned subsidiary of United Services Automobile Association ("USAA") and a holding company for the principal non-insurance operations of USAA. Through its direct and indirect wholly-owned subsidiaries, the Issuer is engaged in various business activities including consumer banking and other financial services activities.

Forward Looking Statements

Some of the information presented in this press release, including, without limitation, statements with respect to the consent solicitation and all other information relating to matters that are not historical facts may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by their use of forward-looking terminology such as "believes," "estimates," "expects," "anticipates," "may," "will," or other comparable terminology. Such forward-looking statements are subject to risks and uncertainties that may cause our actual results, achievements or performance to differ materially from those projected or implied. To the extent permitted by applicable law, the Issuer assumes no obligation to update any forward-looking statements as a result of new information or future events.

SOURCE USAA Capital Corporation