National Mentor, parent settle early tenders for 11¼% notes, floaters

By Jennifer Chiou

New York, Feb. 9 - National Mentor Holdings, Inc. announced the early settlement of the tenders for 95.51% of its $180 million of 11¼% senior subordinated notes due 2014 as well as the tenders for 99.97% of indirect parent company NMH Holdings, Inc.'s $224,400,924 of senior floating-rate toggle notes due 2014.

The company applied proceeds from its previously announced offering of $250 million of 12½% senior notes due 2018 toward the offer.

As of the consent deadline of 5 p.m. ET on Jan. 27, holders had tendered $210,886,717 of the toggle notes and $171,924,000 of the subordinated notes, and the company reported that it had obtained needed consents for the solicitation.

National Mentor said it also used proceeds to pay related fees and expenses while NMH also repurchased $13.5 million of toggle notes held by National Mentor.

The consent solicitation is to eliminate substantially all of the restrictive covenants and certain events of default contained in the respective indentures. NMH needed consents from holders of 75% of the notes while National Mentor needed a majority. Holders who tender will be deemed to consent and consents may not be delivered without tendering.

The companies previously said that they will execute supplemental indentures.

National Mentor paid $1,060 per $1,000 principal amount of its notes, which includes a $30.00 consent payment only made to holders who tendered by the consent date.

NMH paid $1,010 per $1,000 principal amount, again including a $30.00 consent payment that was only be made to holders who tender by the consent date of 5 p.m. ET on Jan .27.

In each case, holders also received accrued interest.

The offers end at 5 p.m. ET on Feb. 16.

Completion of the tender offers and consent solicitations is subject to conditions, including the receipt of the necessary consents and the raising of sufficient funds from a refinancing to pay for the tender offers and to repay National Mentor's existing senior secured credit facilities and term loan mortgage facility. As of Feb. 9, the company said that conditions to the tender had been satisfied.

UBS Investment Bank is dealer manager Questions regarding each tender offer or consent solicitation may be directed to UBS Investment Bank at (888 719-4210 or call collect 203 719-4210) and D.F. King & Co., Inc. is the information agent and tender agent (800 549-6746 or call collect 212 269-5550).

National Mentor is a Boston-based provider of home and community-based health and human services to adults and children with intellectual and/or developmental disabilities, acquired brain injury and other catastrophic injuries and illnesses, and to youth with emotional, behavior and medically complex challenges.

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