Team Health extends consent deadline in tender for 12% notes

New York, March 10 - Team Health Inc. (B2/B+) said that it had extended the consent deadline on its previously announced tender offer for its outstanding 12% senior subordinated notes due 2009. That consent deadline was extended to 5 p.m. ET on March 11, subject to possible further extension, from the originally announced deadline of 5 p.m. ET on March 8.

As of the old deadline, the company had received tenders of about $53 million of the notes.

The March 22 expiration deadline remains unchanged.

As previously announced, Team Health, a Knoxville, Tenn.-based provider of outsourced physician services to hospitals, said on Feb. 25 that it had begun a cash tender offer for any and all of its $100 million principal amount of outstanding 12% notes and was also soliciting noteholder consents to proposed indenture changes that would eliminate substantially all of the restrictive covenants.

The company initially set a consent deadline of 5 p.m. ET on March 8, which has now been extended, and said the tender offer will expire at midnight ET on March 22, subject to possible extension.

Team Health said that holders validly tendering their notes by the consent deadline would receive $1,082.50 per $1,000 principal amount of notes accepted for purchase by the company, including a $20 per $1,000 principal amount consent payment. Holders validly tendering their notes after the consent deadline but before the tender offer expires would receive $1,062.50 per $1,000 principal amount but would not receive the consent payment. All tendering holders would also be paid accrued and unpaid interest up to, but not including, the payment date for the notes.

It said that holders tendering their notes would be required to consent to the proposed amendments to the indenture. They could not tender their notes without also delivering consents or deliver consents without also tendering their notes.

In addition to the tender offer and consent solicitation, Team Health said that it planned to undertake several refinancing transactions, including a private offering of a new series of senior subordinated notes, new senior secured credit facilities; redemption of its outstanding preferred stock; and payment of a dividend to holders of the company's common stock, if the latter step is approved by the company's board of directors.

Team Health said that its tender offer and consent solicitation would be subject to the satisfaction of certain conditions, including the company's receipt of tendered notes representing a majority of the outstanding principal amount; and the completion of the refinancing transactions.

It said it planned to finance the tender offer by a combination of the proceeds from the proposed placement of the new senior subordinated notes and borrowings under the planned new credit facilities.

Team Health said that upon the closing of the new senior subordinated notes offering and the new credit facilities, it planned to call for redemption all notes which might remain outstanding following the tender offer.

J.P. Morgan Securities Inc. (call Chad Joplin collect at 212 270-1171) and Banc of America Securities LLC (call the High Yield Special Products division at 888 292-0070 or collect at 212 847-5834) will be the dealer managers and solicitation agents. Georgeson Shareholder Communications is the information agent (call 212 440-9800 or 866 399-8793).

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