Community Health Systems gets required consents, extends tender for 6½% notes

By Jennifer Chiou

New York, June 13 - Community Health Systems, Inc. said it prolonged the tender offer for its $300 million of 6½% senior subordinated notes due 2012 to midnight ET on July 10.

The tender offer previously was set to expire at midnight ET on June 27.

Community Health also said it expects to execute a supplemental indenture after having received consents from holders of $299.97 million, or 99.99%, of the securities as of the consent deadline of 5 p.m. ET on June 13.

The company is soliciting consents to amend the notes to eliminate substantially all of the restrictive covenants and eliminate or modify some events of default, some conditions to defeasance of the notes and related conditions. The proposed amendments require consent from holders of a majority of the notes.

As of midnight ET on June 12, holders of about $229 million, or 76.2%, of the notes had tendered their securities.

For each $1,000 principal amount of notes tendered by the consent deadline, the payout will be equal to the present value, minus accrued interest, of $1,032.50 plus the remaining scheduled interest payments to Dec. 15, 2008. The payout will be based on a yield to the redemption date equal to 50 basis points over the yield of the 3 3/8% U.S. Treasury due Dec. 15, 2008.

Notes tendered after the consent deadline will receive the same amount, less a consent payment of $30.00 per $1,000 principal amount.

The company also previously said that pricing will now be set at 10 a.m. ET on June 25, instead of June 13.

Holders may not tender notes without soliciting consents.

Settlement of the offer depends on conditions including the completion of the company's merger with Triad Hospitals, Inc. and FWCT-1 Acquisition Corp., the availability of sufficient funds and the receipt of consents from holders of a majority of the notes.

Credit Suisse (212 325-7596) and Wachovia Securities (866 309-6316 or collect 704 715-8341) are the dealer managers. D.F. King & Co., Inc. (800 769-7666 or collect 212 269-5550) is the information agent.

Community Health is a hospital operator based in Franklin, Tenn.

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