National Mentor gets tenders for 99.5% of 9 5/8% notes

By Jennifer Chiou

New York, June 29 - National Mentor, Inc. announced it received tenders from holders of $149.25 million or 99.5% or its $150 million of 9 5/8% senior subordinated notes due 2012.

The tender ended at 8 a.m. ET on June 29. It began on May 25.

As previously announced, at 5 p.m. ET on June 12, the consent deadline, holders of 99.5% of the notes had tendered their securities, sufficient to allow the company to amend the note indenture.

For each $1,000 principal amount of notes, National Mentor will pay $1,134.68, which is the present value of $1,048.13 and interest payments to Dec. 1, 2008, minus accrued interest up to but excluding the settlement date, discounted using the bid-side yield on the 3 3/8% U.S. Treasury note due Dec. 15, 2008 plus 50 basis points. Pricing was set at 2 p.m. ET on June 12.

The total includes a consent payment of $30.00 per $1,000 principal amount that will only be paid to holders who tendered with consents by the consent deadline.

The offer is being made in as part of the Boston company's refinancing in connection with its acquisition by Vestar Capital Partners V, LP. Closing of that merger is expected on June 29.

National Mentor had been soliciting consents to eliminate substantially all of the restrictive covenants and certain events of default and related provisions in the note indenture.

The offer is subject to conditions, including completion of the merger, refinancing of the company's credit facility and the receipt of consents for a majority of the notes.

J.P. Morgan Securities Inc. is dealer manager and solicitation agent (212 270-9769). U.S. Bank NA is the depositary (800 934-6802). MacKenzie Partners, Inc. is the information agent (800 322-2885 or call collect 212 929-5500).

National Mentor provides home and community-based services for individuals with mental retardation and other developmental disabilities, at-risk youth and their families and persons with acquired brain injury.

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