SOURCE: Rural/Metro Corporation

Rural/Metro Corporation

October 21, 2009 07:00 ET

Rural/Metro Announces Commencement of 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 21, 2009) - Rural/Metro Corporation (NASDAQ: RURL), a leading provider of ambulance and private fire protection services, today is launching 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"), as previously announced.

The Company is offering to purchase any and all of its outstanding 2016 Notes. The Company also is soliciting for consents to certain proposed amendments to the indenture governing the 2016 Notes. The tender offer and consent solicitation are being made pursuant to an offer to purchase and consent solicitation statement and a related letter of transmittal, each dated as of October 21, 2009. The tender offer will expire at midnight, New York City time, on November 18, 2009, unless extended (the "expiration date"). Payment for the 2016 Notes validly tendered and the consents validly delivered will be made on a date promptly following the expiration date (the "payment date"). A consent payment will be paid to holders who tender 2016 Notes on or prior to 5:00 p.m., New York City time, on November 3, 2009 (the "consent date"), unless extended.

Holders of 2016 Notes that are validly tendered on or before the consent date and accepted will receive a total consideration in cash of 104% of the accreted value 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 will receive the tender consideration in cash of 103% of the accreted value 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 conditioned upon, among other things, the tender of at least a majority of the outstanding principal amount of 2016 Notes then outstanding, the refinancing of the Company's credit facility due 2011 and the success of the concurrent consent solicitation for the 2015 Notes.

The Company also is soliciting for consents to a proposed amendment to the indenture governing its 2015 Notes. The consent solicitation is being made by Rural/Metro Operating Company, LLC and Rural/Metro (Delaware) Inc. pursuant to a consent solicitation statement, dated October 21, 2009. The consent solicitation will expire at 5:00 p.m., New York City time, on November 3, 2009, unless extended.

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 intends to refinance its current credit facility due 2011.

Rural/Metro is offering 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.

The consent solicitation is conditioned upon the tender and consent of at least a majority of the outstanding principal amount of 2016 Notes on or prior to the consent date in the concurrent tender offer and consent solicitation for the 2016 Notes.

This press release does not constitute an offer to purchase any notes or a solicitation of consents. No offer, solicitation or purchase will be made in any jurisdiction in which such an offer, solicitation, or purchase would be unlawful. The tender offer and consent solicitation for the 2016 Notes are being made pursuant to an offer to purchase and consent solicitation statement and related letter of transmittal, copies of which will be delivered to all holders of the 2016 Notes. The consent solicitation for the 2015 Notes is being made pursuant to a consent solicitation statement, copies of which will be delivered to all holders of the 2015 Notes. The offer to purchase and consent solicitation statement for the 2016 Notes contains important information, and holders of 2016 Notes should read it carefully before making any decision. The consent solicitation statement for the 2015 Notes contains important information, and holders of 2015 Notes should read it carefully before making any decision. Persons with questions regarding the tender offer or solicitation should contact the dealer manager and solicitation agent -- RBC Capital Markets Corporation at (212) 618-2205 -- or the Information Agent, Global Bondholder Services Corporation, at (866) 794-2200 (toll free).

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 www.ruralmetro.com.

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 www.sec.gov, or the Company's web site at www.ruralmetro.com.

(RURL/F)

Contact Information

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