EXHIBIT 99.1
FOR MORE INFORMATION, CONTACT:
Gary Hanson
Vice President, Marketing
(972) 864-5257
SOFTWARE SPECTRUM TO BE ACQUIRED BY LEVEL 3 COMMUNICATIONS
DALLAS, TEXAS - May 2, 2002 - Software Spectrum, Inc. (Nasdaq:SSPE) and Level 3
Communications, Inc. (Nasdaq:LVLT), today announced they have entered into a
definitive merger agreement whereby Level 3 will acquire the Dallas-based global
software services provider, marketer and reseller.
A wholly-owned subsidiary of Level 3 has agreed to acquire all of the
outstanding shares of Software Spectrum for $37 per share in cash. The Boards of
Directors of both Software Spectrum and Level 3 have approved the agreement. In
accordance with the merger agreement, the merger is subject to the approval of
Software Spectrum's shareholders and certain regulatory approvals. Certain
shareholders, representing approximately 28 percent of Software Spectrum's
outstanding shares, including Judy Odom, chief executive officer of Software
Spectrum, have agreed to vote their shares in favor of the merger. The
transaction is expected to close in the third quarter of 2002.
Following closing, Software Spectrum will integrate its operations with
Corporate Software, a software distributor, marketer and reseller that was
acquired by Level 3 earlier this year. The combined companies will have
significant global presence and the extensive resources required to continue to
provide outstanding value and services to their customers worldwide. Howard
Diamond, chief executive of Corporate Software,
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will serve as chairman of the combined company. Judy Odom, current chairman and
chief executive officer of Software Spectrum, will serve as CEO. Keith Coogan
will be president and chief operating officer.
"This is a significant opportunity to provide a great value to our
shareholders," said Odom. "We are also excited about the long-term opportunities
created as a result of combining Software Spectrum and Corporate Software under
the umbrella of Level 3 and its significant broadband and technology
capabilities."
"The new company will have greater global reach, which is vital to our ability
to continue to create outstanding services for our customers," said Keith
Coogan, president and chief operating officer of Software Spectrum. "This
transaction is good for our shareholders, our employees and our customers."
"Over the past few months Level 3 has moved to significantly expand its
information services business," said James Q. Crowe, Level 3's chief executive
officer. "We are doing so in order to take advantage of important economic and
technology trends, including the continuing convergence of the broadband and
software distribution industries. The agreement announced today is a key part of
that effort. Software Spectrum is one of the nation's leading providers of
software products and related services to Fortune 500 enterprises and other
businesses. We believe that integrating their operations with those of our
recently acquired Corporate Software subsidiary will deliver a number of short
and long term benefits to our company and create value for our shareholders."
In March 2002, Level 3 completed the acquisition of Corporate Software, a
private software distribution company based in Norwood, Mass., with annual
revenues exceeding $1 billion. "After closing, we will combine the strengths of
both Corporate Software and Software Spectrum," Diamond said. "The new company
will have breadth and depth of capability and geographical reach that will be
unique in the industry."
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About Software Spectrum
Software Spectrum is a global business-to-business software services provider
with sales locations, operations and contact centers throughout North America,
Europe and Asia/Pacific. The company provides enterprise software management and
contact center solutions that help organizations increase business value from
information technology. For more information, visit Software Spectrum's Web site
at www.softwarespectrum.com.
About Level 3 Communications
Level 3 (Nasdaq:LVLT) is an international communications and information
services company offering a wide selection of services including IP services,
broadband transport, colocation services and the industry's first Softswitch
based services. Its Web address is www.Level3.com.
The company offers information services through its wholly-owned subsidiaries,
(i)Structure and Corporate Software. (i)Structure is an Application
Infrastructure Provider that provides managed IT infrastructure services and
enables businesses to outsource IT operations. Its Web address is
www.i-structure.com.
Corporate Software helps Fortune 500 companies acquire, implement, and manage
software. Its Web address is www.corporatesoftware.com.
Forward Looking Statements
This release may contain forward-looking statements that are based on a number
of assumptions, including expectations for continued market growth, anticipated
revenue and gross margin levels, legal and regulatory proceedings, supplier
relationships, market risk, cost savings and efficiencies, and other factors
discussed in the management's discussion and analysis section of the company's
2001 Form 10-K and other reports and filings with the Securities and Exchange
Commission. Although the
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company believes these assumptions are reasonable, no assurance can be given
that they will prove correct. The company's ability to continue to grow its
product and contact services businesses and improve operational efficiencies
will be key to its success in the future. If the industry's or the company's
performance differs materially from these assumptions or estimates, Software
Spectrum's actual results could vary significantly from the estimated
performance reflected in any forward-looking statements.
Additional Information about the Merger and Where to Find It
Software Spectrum plans to mail a proxy statement to its shareholders in
connection with a shareholder meeting to consider and vote on a proposal to
approve the merger. Shareholders of the company and other investors are urged to
read the proxy statement carefully when it becomes available because it will
contain important information about Software Spectrum, the merger and related
matters. Shareholders and investors can obtain free copies of the proxy
statement when it becomes available by contacting Investor Relations, Software
Spectrum, 2140 Merritt Drive, Garland, Texas, 75041, (972) 840-6600. In
addition, shareholders and investors will be able to obtain free copies of the
proxy statement in connection with the merger and other documents filed by
Software Spectrum with the Securities and Exchange Commission at the SEC's web
site at www.sec.gov.
Software Spectrum and its directors, executive officers and certain members of
management and other employees may be deemed to be participants in the
solicitation of proxies of the company's shareholders to approve the proposed
merger. Such individuals may have interests in the merger, including as a result
of holding options or shares of the company's stock. A detailed list of the
names, affiliations and interests of the participants in the solicitation will
be contained in the proxy statement that will be filed by Software Spectrum with
the SEC.