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Prospect Medical begins tender offer for 12¾% notes, solicits consents
By Angela McDaniels
Tacoma, Wash., April 18 - Prospect Medical Holdings, Inc. began a tender offer for its $151.8 million principal amount of outstanding 12¾% senior secured notes due 2014, according to a company news release.
The company is also soliciting consents to proposed amendments to the indenture governing the notes and related collateral documents. The proposed amendments would eliminate most of the restrictive covenants and some events of default and other provisions in the indenture, delete any provisions from the collateral documents prohibiting the grant of liens to secure the company's proposed new debt financing arrangements and provide that the collateral securing the notes and the related guarantees would secure the company's proposed new debt financing arrangements on a pari passu basis.
Consents are needed from the holders of at least two-thirds of the notes in order to make the amendments. Holders may not tender their notes without delivering consents or vice versa.
The tender offer will expire at 11:59 p.m. ET on May 15.
The company is offering $1,087.95 per $1,000 principal amount of notes. This includes a $30.00 consent payment for each note tendered by 11:59 p.m. ET on May 1, the consent expiration.
The company will also pay accrued interest up to but excluding the applicable payment date.
The company expects the settlement date for holders who tender their notes prior to the consent expiration to be May 3.
The offer is subject to the company obtaining enough financing, the execution of a supplemental indenture effecting the proposed amendments to the indenture and the execution of amendments to the collateral documents.
The dealer manager is Morgan Stanley & Co. LLC (800 624-1808 or 212 761-1057). The tender and information agent is D.F. King & Co., Inc. (800 431-9643 or, for banks and brokers, 212 269-5550).
Los Angeles-based Prospect Medical is a health-care services company.
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