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Published on 12/3/2004 in the Prospect News Convertibles Daily.

Manor Care says 93% of 2.125% convertibles exchanged

New York, Dec. 3 - Manor Care Inc. said holders tendered $93 million or 93% of its $100 million of 2.125% contingent convertible senior notes due 2023 in its exchange offer for the securities.

The exchange expired at midnight ET on Dec. 2.

Manor Care carried out the exchange in response to new accounting regulations.

The new securities are "substantially similar" to the existing convertibles but have net share settlement - on conversion Manor Care will pay cash up to the principal amount and the remainder in stock.

In addition, if holders of new notes exercise their right to require Manor Care to repurchase the notes on certain future dates and upon the occurrence of certain events, the company will be obligated to pay for them in cash.

Bondholders who exchanged received a fee of 25 basis points.

The exchange was announced on Nov. 3 and extended on Nov. 19.

Global Bondholder Services Corp. is the information agent and exchange agent (212 430-3774 (banks and brokerage firms) or 866 470-4500).

Toledo, Ohio-based Manor Care operates long-term care centers and other medical facilities.


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