The Government Of Bermuda Announces Commencement Of Cash Tender Offers For Up To U.S.$150,000,000 In Aggregate Principal Amount Of Its 5.603% Senior Notes Due 2020 And 4.138% Senior Notes Due 2023

HAMILTON, Bermuda, Sept. 28, 2016 /PRNewswire/ -- The Government of Bermuda (the "Government") announced today the commencement of offers to purchase for cash (the "Tender Offers") up to U.S.$150,000,000 aggregate principal amount (as such amount may be increased at the sole discretion of the Government, the "Maximum Tender Amount") of its 5.603% Notes due 2020 (the "Notes due 2020") and its 4.138% Notes due 2023 (the "Notes due 2023" and, together with the Notes due 2020, the "Existing Notes"), such Maximum Tender Amount initially intended to be allocated between the series of Existing Notes in the Government's discretion (each, a "Tender Offer Cap"). The terms and conditions of the Tender Offers are set forth in the Offer to Purchase, dated September 28, 2016 (the "Offer to Purchase").

The tender period (the "Tender Period") will commence on September 28, 2016 and expire at 5:00 p.m., New York City time, on October 18, 2016 unless extended or earlier terminated by the Government in its sole discretion (the "Expiration Time").  The settlement of the Tender Offers is scheduled to occur on October 19, 2016 (the "Settlement Date").

The Tender Offers are not conditioned upon any minimum participation by the holders of either series of the Existing Notes but are conditioned on (a) the satisfaction or waiver by the Government of the conditions described in the Offer to Purchase, (b) the closing of an offering of new notes (the "New Notes") by the Government (the "New Notes Offering"), which is intended to settle prior to or concurrently with the Tender Offers, and (c) the dealer manager agreement relating to the Tender Offers not being terminated prior to or at the time of the settlement of the Tender Offers.  The Tender Offers are not conditioned on each other.  The Government may allocate the Maximum Tender Amount to either series of Existing Notes or not at all or purchase less or more Existing Notes, in its sole discretion.  The Government currently intends to allocate the Maximum Tender Amount between the series of Existing Notes, but the Government may vary the allocations in any way it deems appropriate, including allocating the full Maximum Tender Amount to just one series of Existing Notes. The principal amount of Existing Notes accepted for purchase in the Tender Offers may be limited because of the Maximum Tender Amount and the Tender Offer Caps. The Government will not accept for purchase more than the Maximum Tender Amount of Existing Notes validly tendered, or more than the applicable Tender Offer Cap for each series, even if Existing Notes in excess of such amounts are validly tendered.  In addition, tenders validly submitted on or prior to the Early Participation Deadline will be preferred and accepted before any tenders validly submitted after the Early Participation Deadline, meaning that tenders submitted after the Early Participation Deadline may not be accepted at all.

Allocations in the New Notes Offering will be determined by the Government and HSBC Securities (USA) Inc. ("HSBC"), as initial purchaser in the New Notes Offering, in their sole discretion based on a number of different factors, which may include an assessment of an investor's long term interest in owning debt securities of the Government, the size and timing of such investor's indication of interest in purchasing New Notes, and the tenders in the Tender Offers. However, neither the Government nor HSBC are obligated to consider participation in the Tender Offers in making an allocation determination with respect to the New Notes with regard to any particular investor.

The table below summarizes certain payment terms of the Tender Offers:

____________

* Per U.S.$1,000 Principal Amount of Existing Notes accepted for purchase.

For each U.S.$1,000 principal amount of Existing Notes validly tendered on or prior to 5:00 PM New York City time on October 7, 2016 (the "Early Participation Deadline") and accepted pursuant to the Tender Offers, the Government will pay the applicable Total Consideration indicated in the table above (each, a "Total Consideration"), plus Accrued Interest (as defined below) thereon. The Total Consideration includes an early tender premium per U.S.$1,000 principal amount of each series of Existing Notes validly tendered on or prior to the Early Participation Deadline and accepted for purchase, equal to the amount indicated in the table above (each, an "Early Tender Premium").

For each U.S.$1,000 principal amount of Existing Notes validly tendered after the Early Participation Deadline but on or prior to the Expiration Time, and accepted pursuant to the Tender Offers, the Government will pay the applicable Purchase Price indicated in the table above (each, a "Purchase Price"), plus Accrued Interest thereon.

Holders of Existing Notes participating in the Tender Offers whose Existing Notes are accepted for purchase will also receive any accrued and unpaid interest on their Existing Notes from, and including, the last interest payment date for such Existing Notes to, but not including, the Settlement Date ("Accrued Interest"). Tenders that are accepted will be settled solely by the Government on the Settlement Date, subject to the terms and conditions of the Tender Offers.

During the Tender Period, a holder of Existing Notes may place orders to tender such Existing Notes through the DTC, Euroclear or Clearstream, Luxembourg clearing systems. Holders who tender their Existing Notes will not have withdrawal rights with respect to the Tender Offers, unless required by applicable law.

Tenders of Existing Notes may be subject to proration, in accordance with the terms of the Tender Offers described in the Offer to Purchase.

The Government reserves the right, in its sole discretion, not to accept any tender for any reason or to extend, re- open, amend or terminate the Tender Offers, or to close a Tender Offer to further Tenders if valid tenders at or in excess of the applicable Tender Offer Cap have been received prior to the Early Participation Deadline, in its sole discretion.

Any extension, termination or amendment of the Tender Offers will be followed, as promptly as practicable, by public announcement thereof.  The Government shall communicate such public announcement by issuing a press release in accordance with applicable law and by an announcement on the website of the Luxembourg Stock Exchange (www.bourse.lu) and the website of the Bermuda Stock Exchange (www.bsx.com), which websites are not incorporated herein by reference and on the Offer Website run by the Tender and Information Agent (http://www.gbsc-usa.com/Bermuda).

The Dealer Manager for the Tender Offers is:

HSBC Securities (USA) Inc.

452 Fifth Avenue 
New York, New York 10018
United States of America
Attn: Global Liability
Management Group

Collect: 1 212 525 5552
Toll-Free: 1 888 HSBC 4LM

Questions regarding the Tender Offers may be directed to the Dealer Manager at the above contact.

The Offer to Purchase, as well as other relevant notices and documents, will also be available on the Tender Offer Website, http://www.gbsc-usa.com/Bermuda operated by the Tender and Information Agent.

The Tender and Information Agent for the Tender Offers is Global Bondholder Services Corporation, Inc.

65 Broadway, Suite 404
New York, New York 10006
United States

Banks and Brokers call: (212) 430-3774
Toll-Free: (866) 470-4200
Email: [email protected]
By facsimile: (for Eligible Institutions only) (212) 430-3775
Confirmation: (212) 430-3774

Holders of the Existing Notes are urged to read the Offer to Purchase carefully. Any questions or requests for assistance in relation to the Offer to Purchase may be directed to the Dealer Manager at its telephone number set forth above or to the holder's broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Tender Offers. Requests for additional copies of the Offer to Purchase may be directed to the Tender and Information Agent at the address and telephone number set forth above.

This release shall not be construed as an offer to purchase or a solicitation of an offer to purchase any of the Existing Notes or any other securities.

The Tender Offers are not being made 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. None of the Government, the Bank of New York Mellon as trustee for the Existing Notes, the Dealer Manager or the Information and Tender Agent makes any recommendation as to whether or not holders should tender their Existing Notes pursuant to the Tender Offers.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended.  All statements other than statements of historical facts included in this press release are forward-looking statements.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Government, to be materially different from any future results or performance expressed or implied by such forward-looking statements.  These statements are based on certain assumptions and analyses the Government has made in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors believed to be appropriate in the circumstances.  The Government cautions you that a number of important factors could cause actual results and developments to differ materially from those contained in any forward-looking statement.  The information contained in this press release identifies important factors that could cause such differences.  The Government undertakes no obligation to update any of its forward-looking statements.

SOURCE The Government of Bermuda