Boston, MA 10/03/2014 (wallstreetpr) – Education Management Corp (NASDAQ:EDMC) disclosed that it has commenced the exchange of all outstanding Senior Cash PIK/Pay Notes due in 2018 through a private offer. Senior PIK Toggle Notes that was due in 2018 was also included in the exchange offer. The move is in connection with the company’s planned restructuring.
Exchange Offer
The senior notes were co-issued by Education Management Corp (NASDAQ:EDMC)’s indirectly owned subsidiaries, its statement indicated. The company said that the exchange offer was made only to qualified holders in agreement with the terms and conditions set forth in the offer document of October 1. The company said that the exchange offer would close on October 29 New York time unless it was extended by it.
Education Management Corp (NASDAQ:EDMC) said that those tender their notes and does not withdraw it before October 22 would be eligible to get additional consideration. Accordingly, qualified note holders would get interest, both accrued, as well as, unpaid for every $1,000 till September apart from the principal amount. It would also be provided 8.5 preferred A-2 shares besides their pro rata basis share of Class A warrants for the acquisition of a maximum of 10%.
Similarly, qualified holders would be able to get 95% of the Preferred A-Shares for every $1,000 of the exchange amount. This apart, the holders would be offered 95% of the Class A Warrants. These were subject to the holders tendering their notes before the early deadline fixed by the company.
Accredited Investors
Education Management Corp (NASDAQ:EDMC) has made it clear that only accredited investors would be offered the Preferred A-2 shares besides Class A Warrants. The company said that the Preferred A-2 Shares and Class A Warrants would not be registered under the act of Securities.
The company said that it reserved the right to waive and amend any exchange offer conditions, excluding restructuring condition, from time to time. It also said it was vested with powers to terminate or withdraw the exchange offer at any given time.
