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SCOTTSDALE, AZ--(MARKET WIRE)--Mar 16, 2009 -- Rural/Metro Corporation (NasdaqGS:RURL - News), leading provider of ambulance and private fire protection services, announced today that it has voluntarily made a prepayment of $5.0 million to reduce the outstanding principal balance of its senior secured Term Loan B to $66.0 million. Since the inception of such loan in March 2005, the Company has made a total of $69.0 million in voluntary principal prepayments.
Jack Brucker, President and Chief Executive Officer, said, "We have continued to execute on our business plan to achieve growth through new contract wins and same-market expansion, while reducing uncompensated care and overall operating expenses as a percent of revenue. Free cash flows remain strong and enable us to comfortably make the $5.0 million voluntary principal prepayment to further reduce debt and continue on our strategic path toward deleveraging."
Additionally, the Company's Board of Directors this week authorized the Company to amend its Shareholder Rights Plan (the "Plan") to raise the threshold at which the plan is triggered from 4.99% to no more than 10.00%. The amendment continues to provide the Board with the ability to grant waivers to stockholders requesting to exceed the 10.00% threshold, subject to the Plan's maximum stock ownership limit of 15.00%.
Kristi Ponczak, Senior Vice President and Chief Financial Officer, explained, "The decision was made after careful consideration of the Company's improving position with respect to change-in-ownership rules under Section 382 of the U.S. Internal Revenue Code and our desire to enhance trading capacity for existing and potential new stockholders."
In general, Section 382 limits the use of a corporation's net operating losses and certain other tax benefits following a cumulative change in stock ownership of 50.0% or more among holders of 5.0% or more of the company's stock.
About Rural/Metro
Rural/Metro Corporation provides emergency and non-emergency ambulance services and private fire protection services in 22 states and approximately 400 communities throughout the United States. For more information, visit the Company's web site at www.ruralmetro.com.
SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS
The foregoing reflects the Company's views about its future financial condition, performance and other matters that constitute "forward-looking" statements as such term is defined by the federal securities laws. Many of these statements can be found by looking for words such as "anticipate," "expect," "plan," "intend," may," "should," "will likely result," "continue," "estimate," "project," or similar words used herein in connection with any discussions of future operating or financial performance or business prospects. We may also make forward-looking statements in our earnings reports filed with the Securities and Exchange Commission (SEC), earnings calls and other investor communications. These forward-looking statements are subject to the safe harbor protection provided by federal securities laws. These forward-looking statements are subject to numerous risks, uncertainties and assumptions, including those relating to the Company's future business prospects, uncompensated care, working capital, accounts receivable collection, liquidity, cash flow, EBITDA, capital expenditures, insurance coverage and claim reserves, capital needs, future operating results and future compliance with covenants in our debt facilities or instruments. In addition, the Company may face risks and uncertainties related to other factors that are listed in its periodic reports filed under the Securities Exchange Act. Although the Company believes the expectations reflected in its forward-looking statements are based upon reasonable assumptions, because the statements are subject to risks and uncertainties, the Company can give no assurance that its expectations will be attained or that actual developments and results will not materially differ from those expressed or implied by the forward-looking statements. Readers are cautioned not to place undue reliance on the statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by law.
(RURL/F)
CONTACT:
Liz Merritt
Rural/Metro Corporation
(480) 606-3337
Sharrifah Al-Salem, FD
(415) 293-4414
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