SOURCE: Rural/Metro Corporation

Rural/Metro Corporation

October 20, 2009 07:39 ET

Rural/Metro Announces Commencement of Credit Facility Refinancing and Intention to Launch Tender Offer and Consent Solicitation for Its 12.75% Senior Discount Notes Due 2016 and Consent Solicitation for Its 9.875% Senior Subordinated Notes Due 2015

SCOTTSDALE, AZ--(Marketwire - October 20, 2009) - Rural/Metro Corporation (NASDAQ: RURL), a leading provider of ambulance and private fire protection services, announced today that it is commencing a refinancing of its credit facility. It also announced that it expects to launch a tender offer and consent solicitation for its 12.75% Senior Discount Notes due 2016 ("2016 Notes") and a consent solicitation for its 9.875% Senior Subordinated Notes due 2015 ("2015 Notes").

The Company intends to offer to purchase any and all of its outstanding 2016 Notes. The Company also intends to solicit consents to certain proposed amendments to the indenture governing the 2016 Notes.

Holders of 2016 Notes that validly tender prior to a consent date which will be established for the offer are expected to be offered total consideration of 104% of the accreted value of the 2016 Notes as of the payment date for each $1,000 principal amount at maturity of 2016 Notes tendered, which includes a consent payment of 1% of the accreted value as of the payment date for each $1,000 principal amount at maturity.

Holders of 2016 Notes that are tendered after the consent date, but on or prior to the expiration date are expected to be offered tender consideration of 103% of the accreted value of the 2016 Notes as of the payment date for each $1,000 principal amount at maturity of 2016 Notes tendered. Holders of 2016 Notes tendered after the consent date will not receive the consent payment.

The proposed amendments to the 2016 Notes would eliminate or modify substantially all of the restrictive covenants, certain events of default, and certain other provisions contained in the indenture governing the 2016 Notes. Noteholders who tender the 2016 Notes will be required to consent to the proposed amendments, and noteholders who consent to the proposed amendments will be required to tender their 2016 Notes.

The tender offer and the consent solicitation are expected to be contingent upon the tender of at least a majority of the outstanding principal amount of 2016 Notes, the refinancing of the Company's credit facility due 2011 and the success of a concurrent consent solicitation for the 2015 Notes.

The Company intends to launch a solicitation for consents to a proposed amendment to the indenture governing its 2015 Notes. The proposed amendment to the 2015 Notes would modify the restricted payment covenant governing the indenture, allowing for a dividend payment to Rural/Metro Corporation in an amount sufficient to repurchase the 2016 Notes. In order to repurchase its 2016 Notes, the Company also intends to refinance its current credit facility due 2011.

Rural/Metro expects to offer a consent fee of $50.00 for each $1,000 in principal amount of 2015 Notes as to which the holder provides a consent. Approval of the proposed amendment with respect to the 2015 Notes requires the consent of holders of at least a majority in principal amount of the outstanding 2015 Notes.

If consents are received from the requisite majority of holders of the 2015 Notes, Rural/Metro will execute a supplemental indenture and thereafter the consents may not be revoked unless Rural/Metro fails to pay the required consent fee.

The consent solicitation relating to the 2015 Notes is expected to be contingent upon the tender in the concurrent tender offer of, and the receipt in the consent solicitation for the 2016 Notes by holders of, not less than a majority of the outstanding 2016 Notes.

This press release does not constitute an offer to purchase any notes or a solicitation of consents. Any offer to purchase or solicitation of consents for the 2016 Notes will be made by means of an offer to purchase and related letter of transmittal. The consent solicitation for any 2015 Notes will be made pursuant to a consent solicitation statement. No offer, solicitation or purchase will be made in any jurisdiction in which such an offer, solicitation, or purchase would be unlawful.

About Rural/Metro Corporation

Rural/Metro Corporation provides emergency and non-emergency ambulance services and private fire protection services in 22 states and approximately 400 communities throughout the United States. For more information, visit the Rural/Metro Corporation's web site at

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "will," "believes," "seeks," "anticipates," "intends," "estimates," "expects," "projects," "plans," and similar expressions are intended to identify forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future, including statements relating to the consent solicitation and the concurrent tender offer and consent solicitation by Rural/Metro Corporation and any financing related thereto, growth, expected levels of expenditures and statements expressing general optimism about future operating results, are forward-looking statements. Similarly, statements that describe the Company's business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements and those presented elsewhere by the Company's management from time to time are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. See risks and uncertainties described in "Risk factors" included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2009, filed with the Securities and Exchange Commission ("SEC") on September 9, 2009. A copy of all SEC filings may be obtained from the SEC's EDGAR web site at, or the Company's web site at


Contact Information

    Liz Merritt
    Rural/Metro Corporation (investors)
    (480) 606-3337
    Sharrifah Al-Salem, FD
    (415) 293-4414