Xerox Prices New Financing; Signs New Credit Agreement

     
BW20030619002116  20030620T060035Z UTC


( BW)(XEROX-CORP.)(XRX) Xerox Prices New Financing; Signs New Credit
Agreement

    Business Editors
    UK REGULATORY NEWS

    STAMFORD, Conn.--(BUSINESS WIRE)--June 20, 2003--

Xerox Corporation (NYSE: XRX) set pricing today on the issuance of new
common stock, mandatory convertible preferred stock and senior
unsecured notes. The company also said that it finalized the terms of
a new revolving credit facility.

Upon the closing of these transactions, Xerox will complete its
recapitalization plan announced earlier this month. This financing
will de-lever the balance sheet and extend debt maturities, providing
Xerox with additional operating and financial flexibility.

The company will issue approximately 40 million shares of common stock
at $10.25 per share and will issue 8 million shares of 3-year
mandatory convertible preferred stock at $100 per share. The mandatory
convertible preferred stock will have a dividend yield of $6.25 per
share and a conversion premium of 20 percent over the common stock
offering price of $10.25 per share.

Xerox will also issue $750 million of 7-year senior unsecured notes
due 2010 and bearing interest at 71/8 percent. In addition, $500
million of 10-year senior unsecured notes due 2013 will be issued,
bearing interest at 75/8 percent.

The company noted that the mandatory convertible preferred stock and
the senior unsecured notes were oversubscribed from initial
expectations due to strong demand.

Also today Xerox entered into an agreement with Citigroup, Deutsche
Bank, Goldman Sachs, JPMorgan, Merrill Lynch and UBS for a new $1
billion credit facility consisting of a $700 million revolving
facility and a $300 million term loan, both maturing in September
2008. This new credit facility, which is expected to close on June
25, becomes effective upon successful completion of the company's
common stock and mandatory convertible preferred stock offerings.

This press release does not constitute an offer to sell or a
solicitation of an offer to buy any securities of Xerox including
shares of common stock, shares of mandatory convertible preferred
stock or senior unsecured notes. Shares of common stock, shares of
mandatory convertible preferred stock or senior unsecured notes will
not be sold in any state or jurisdiction in which such an offer,
solicitation, or sale would be unlawful.

For additional information about The Document Company Xerox, please
visit our Worldwide Web site at www.xerox.com/investor.

This release contains forward-looking statements and information
relating to Xerox that are based on our beliefs as well as assumptions
made by and information currently available to us. The words
"anticipate," "believe," "estimate," "expect," "intend," "will" and
similar expressions, as they relate to us, are intended to identify
forward-looking statements. Actual results could differ materially
from those projected in such forward-looking statements. Information
concerning certain factors that could cause actual results to differ
materially is included in the company's Form 10-Q for the quarter
ended March 31, 2003, as filed with the SEC.

XEROX(R), The Document Company(R) and the digital X(R) are trademarks
of XEROX CORPORATION.

   Short Name: Xerox Corporation
   Category Code: MSC
   Sequence Number: 00006158
   Time of Receipt (offset from UTC): 20030619T235527+0100

    --30--DB/ny

    CONTACT: Xerox Corporation
             James A. Ramsey             
             Director, Investor Relations         
             203-968-3807                    
             [e-mail]
             Fax [phone]              
                    or
             Cynthia B. Johnston            
             Manager, Investor Relations    
             203-968-3489                   
             [e-mail]
             Fax [phone]             

    KEYWORD: CONNECTICUT UNITED KINGDOM INTERNATIONAL EUROPE
    INDUSTRY KEYWORD: BANKING COMPUTERS/ELECTRONICS
    SOURCE: Xerox Corporation

Today's News On The Net - Business Wire's full file on the Internet
                          with Hyperlinks to your home page.
                          URL: http://www.businesswire.com