FPA Medical Management Inc. announces offering of $75 million Convertible Subordinated Debentures.SAN DIEGO--(BUSINESS WIRE)--Dec. 13, 1996--FPA Medical Management, Inc. (Nasdaq:FPAM FPAM Financial Planning Association of Malaysia ) today announced that it has entered into a purchase agreement providing for the sale of $75,000,000 aggregate principal amount of 6.5% Convertible Subordinated Debentures subordinated debenture An unsecured bond with a claim to assets that is subordinate to all existing and future debt. Thus, in the event that the issuer encounters financial difficulties and must be liquidated, all other claims must be satisfied before due December 15, 2001 (the "Debentures"). The Company has granted to the initial purchasers the option to purchase up to an additional $11,250,000 principal amount of the Debentures solely to cover over-allotments. The Debentures will be convertible into shares of Common Stock of the Company at a fixed conversion price per share equal to $25.95, subject to adjustment in certain circumstances. The Debentures will be redeemable by the Company at declining redemption prices Redemption price See: Call price redemption price 1. The price at which an open-end investment company will buy back its shares from the owners. In most cases, the redemption price is the net asset value per share. 2. commencing in December 1999. The purpose of the offering is to provide funds to repay certain indebtedness and for general corporate purposes, including acquisitions to support future growth. The Company intends to issue the Debentures on December 18, 1996 and to register the Debentures and the underlying Common Stock within 30 days of the first issuance of the Debentures. Steven M. Lash, FPA's Executive Vice President and Chief Financial Officer stated, "This transaction allows FPA 1. (hardware) FPA - floating-point accelerator. 2. (programming) FPA - Function Point Analysis. to repay approximately $39 million in debt, and add approximately $33 million in cash to our balance sheet." The Debentures are being offered through initial purchasers 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. only to qualified institutional buyers In law, a Qualified Institutional Buyer is a purchaser of securities that is financially sophisticated and is legally recognized by security market regulators to need less protection from sellers than most members of the public. in reliance on 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. under the Securities Act of 1933, as amended (the "Act") and to a limited number of institutional "accredited investors" as defined in the Act. The remainder of the Debentures are being offered by the initial purchasers outside the United States in reliance on Regulation S under the Act. The Debentures have been designated for trading in the Private Offerings, Resales and Trading through Automated Linkages (PORTAL) Market of the National Association of Securities Dealers National Association of Securities Dealers (NASD) Nonprofit organization formed under the joint sponsorship of the investment bankers' conference and the SEC to comply with the Maloney Act, which provides for the regulation of the OTC market. , Inc. -0- THE DEBENTURES AND THE UNDERLYING COMMON STOCK OFFERED HAVE NOT BEEN REGISTERED UNDER THE ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS. -0- FPA Medical Management, Inc. is a national healthcare management service organization which organizes and manages primary care physician networks and provides contract management services to hospital-based emergency departments. CONTACT: Investor Contact: FPA Medical Management, Inc. Steven M. Lash Executive Vice President and Chief Financial Officer 619-453-1000 or Media Contact: Morgen-Walke Associates Robert P. Jones\Jill Ruja Miriam Adler 212-850-5600 |
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