21st Century Oncology transaction agreement deadline pushed to Jan. 4

By Wendy Van Sickle

Columbus, Ohio, Dec. 16 – 21st Century Oncology, Inc. obtained an extension of its deadline to enter into a transaction support agreement with its credit agreement lenders and holders of its $360.7 million 11% senior notes due 2023, according to an 8-K filed Thursday with the Securities and Exchange Commission.

Specifically, the company now has until Jan. 4, extended from Dec. 15, to enter into the agreement.

As reported on Dec. 5, the company failed to cure the default on its 11% notes after failing to pay the interest due Nov. 1, which in turn triggered a cross default under the company’s credit agreement dated April 30, 2015 with Morgan Stanley Senior Funding, Inc. as administrative agent.

On top of that, the company missed the chance to satisfy the second capital event for the issue or sale of its capital stock or from other equity investments and/or sales of assets for at least $25 million as of Nov. 30, which prompted another event of default under the notes indenture.

“The company has been working with its lenders, bondholders and stakeholders to address these events of default” and has secured forbearance agreements with some noteholders and lenders for more time to remedy the events of default, a filing noted at that time.

The company said it could not assure that it would be able to reach an agreement.

The company obtained a forbearance on Dec. 6 with beneficial owners of more than 90% of the outstanding notes as well as some lenders and the administrative agent.

The majority holders and the company’s lenders have agreed to forbear until Jan. 15 from exercising their rights under the default.

The forbearance agreement also provides for “significant additional restrictions, including further limiting the ability of 21C and certain of its subsidiaries to incur additional debt, pay dividends on or make distributions in respect of their equity interests or make other restricted payments or investments, make asset dispositions, incur liens or enter into or conduct affiliate transactions, and requiring 21C and certain of its subsidiaries to conduct their business only in the ordinary course.”

21st Century Oncology is a subsidiary of 21st Century Oncology Holdings, Inc., a Fort Myers, Fla.-based provider of integrated cancer care services.

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