HealthSouth Cures Remaining Payment Default and Accomplishes Important Milestone in Financial Restructuring
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12:31 p.m. 01/16/2004
HealthSouth Retires 3.25% Convertible Subordinated Debentures
BIRMINGHAM, Ala., Jan 16, 2004 /PRNewswire-FirstCall via COMTEX/ -- HealthSouth Corporation (OTC Pink Sheets: HLSH) announced today that it refinanced its 3.25% Convertible Subordinated Debentures due April 1, 2003, from the net proceeds of a $355 million loan arranged by Credit Suisse First Boston. The new senior subordinated term loan has an interest rate of 10.375% per annum, payable quarterly, with a 7-year maturity, callable after the third year with a premium. HealthSouth also issued warrants to the lender to purchase 10 million shares of common stock. Each warrant will have a term of 10 years from the date of issuance and an exercise price of $6.50 per share.
With this refinancing, HealthSouth is current on all of its outstanding principal and interest payments due under the Company's various borrowing agreements. HealthSouth intends to remain current on all upcoming payments. The Company will seek to reach agreements with the holders of its other outstanding indebtedness, which may provide for increased interest rate provisions or other consent fees, consistent with the leverage ratios of the Company.
"Today's financing marks an important milestone in HealthSouth's ongoing efforts to complete our restructuring," said Joel C. Gordon, HealthSouth's Acting Chairman. "We appreciate the support of our noteholders, bank lenders and stockholders and thank them for their ongoing cooperation. We believe that this refinancing is a major step towards HealthSouth's full recovery." |
