Concentra Announces Sale of $155 Million of Senior Subordinated Notes and Amendment of Senior Credit Facility.Business Editors ADDISON, Texas--(BUSINESS WIRE)--June 8, 2004 Concentra Operating Corporation ("Concentra" or "the Company") today announced that it has sold $155 million aggregate principal amount of its 9.125% Senior Subordinated Notes due 2012, in accordance with Securities and Exchange Commission Rule 144A Rule 144A A Securities & Exchange Commission rule modifying a two-year holding period requirement on privately placed securities to permit qualified institutional buyers to trade these positions among themselves. and Regulation S. The Senior Subordinated Notes were priced at 98.613% of par to yield 9.375% to maturity. In addition, the Company announced the closing of an amendment to its existing Senior Credit Agreement under which the Company has borrowed an additional $70 million of term debt. The Senior Subordinated Notes are general unsecured obligations of the Company, are subordinated to all existing and future senior debt of the Company, and rank pari passu [Latin, By an equal progress; equably; ratably; without preference.] Used especially to describe creditors who, in marshalling assets, are entitled to receive out of the same fund without any precedence over each other. PARI PASSU. By the same gradation. with the Company's existing 9.5% Senior Subordinated Notes due 2010 and 13% Senior Subordinated Notes due 2009. The additional $70 million in term loans bear the same covenants and maturity dates as established in the Company's existing Senior Credit Agreement. The Company intends to use the net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of the debt offering and additional borrowings under the amended Senior Credit Agreement, together with approximately $43 million of cash on hand, to fund the retirement of $114.9 million in 13% Senior Subordinated Notes due 2009 tendered in connection with the Company's recent tender offer and consent solicitation Consent Solicitation A solicitation by one party to the stakeholders of a particular security for the consent of a material change. Notes: Should the majority of stakeholders provide valid consent prior to the consent expiry date, the issuer may then follow through with , to redeem $27.6 million in untendered 13% Senior Subordinated Notes, to declare a dividend of approximately $97.2 million to its parent corporation, Concentra Inc., and to pay associated fees and expenses. In connection with its amendment of the Senior Credit Agreement, the Company has placed $29.4 million into escrow escrow Instrument, such as a deed, money, or property, that constitutes evidence of obligations between two or more parties and is held by a third party. It is delivered by the third party only upon fulfillment of some condition. for the purposes of funding the principal and call premium payments necessary to redeem the remaining outstanding 13% Senior Subordinated Notes. Currently, Concentra anticipates that this redemption will occur on or after August 15, 2004, and, as such, that the Company will carry these additional cash balances as well as the remaining $27.6 million of untendered indebtedness at June 30, 2004. During the second quarter, the Company also expects to expense approximately $11.8 million in debt termination costs and approximately $2.5 million in equity instrument adjustments and other compensatory costs incurred in connection with the transactions. Under its amended Senior Credit Agreement, these expense amounts, as well as the additional untendered indebtedness balances, will be excluded from consideration in the Company's debt covenant computations. This announcement is neither an offer to sell nor a solicitation of an offer to buy the securities described herein. The securities to be offered will not be registered under the Securities Act of 1933 or any state securities laws and may not be offered or sold in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. absent registration or an applicable exemption from registration requirements. Concentra, headquartered in Addison, Texas Addison is a city in Dallas County, Texas (USA). The population was 14,166 at the 2000 census. Addison is a northern suburb of Dallas. The city calls itself the Town of Addison but it is incorporated as a city. , the successor to and a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Concentra Inc., provides services designed to contain healthcare and disability costs and serves the occupational, auto and group healthcare markets. This press release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which the Company is making in reliance on the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Investors are cautioned that all forward-looking statements involve risks and uncertainties, and that the Company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the potential adverse impact of governmental regulation on the Company's operations, changes in nationwide employment and workplace injury trends, interruption in its data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a capabilities, operational, financing, completion and strategic risks related to the Company's capital structure, refinancing of indebtedness, and growth strategy, possible fluctuations in quarterly and annual operations, possible legal liability for adverse medical consequences, competitive pressures, adverse changes in market conditions for the Company's services and dependence on key management personnel. Additional factors include those described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statements or to make any other forward-looking statements, whether as a result of new information, future events, or otherwise. |
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