New Issue: K-V Pharmaceutical sells $225 million 12% notes due 2015 at 97 in private placement

By Paul A. Harris

Portland, Ore., March 16 - K-V Pharmaceutical Co. privately placed an upsized $225 million issue of 12% four-year senior secured notes, according to a Tuesday press release.

The notes were sold at a reoffer price of 97.

The deal was upsized from $200 million.

Proceeds from the Regulation D notes offering will be used to repay the company's credit agreement with U.S. Healthcare I, LLC and U.S. Healthcare II, LLC, including the payment of related premiums, and to terminate the related future loan commitments and to fund general corporate purposes.

The St. Louis-based fully integrated specialty pharmaceutical company also plans to establish an escrow reserve for one year of interest payments on the notes.

Issuer:	K-V Pharmaceutical Co.
Amount:	$225 million, increased from $200 million
Maturity:	March 15, 2015
Securities:	Senior secured notes
Coupon:	12%
Price:	97.00
Equity clawback:	35% at 112 until March 15, 2013
Call features:	At any time prior to March 15, 2013, the company may redeem all or part of the notes at a redemption price equal to the sum of the present value, discounted to the redemption date, of a cash payment to be made on March 15, 2013 of 109, and each interest payment that is scheduled to be made on or after the redemption date and on or before March 15, 2013, plus accrued and unpaid interest to the redemption date. The notes become callable on March 15, 2013 at 109, with the premium declining to par on March 15, 2014
Distribution:	Regulation D

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