February 01, 2015 6:58 PM ET

Healthcare Providers and Services

Company Overview of Rotech Healthcare Inc.

Company Overview

Rotech Healthcare Inc., together with its subsidiaries, provides home medical equipment and related products and services in the United States. It rents and sells oxygen and other respiratory therapy equipment and services, including oxygen concentrators, liquid oxygen systems, high pressure oxygen cylinders, homefill systems, portable oxygen concentrators, continuous positive airway pressure devices and supplies, bi-level positive airway pressure devices and supplies, non-invasive positive pressure ventilator devices and supplies, and nebulizer devices and medications. The company also sells and rents a line of durable medical equipment, such as hospital beds, wheelchairs, walkers, patient ...

2600 Technology Drive

Suite 300

Orlando, FL 32804

United States

Founded in 1981

3,800 Employees

Phone:

407-822-4600

Fax:

407-297-6217

Key Executives for Rotech Healthcare Inc.

President and Chief Executive Officer
Chief Financial Officer
Age: 42
Chief Legal Officer and Secretary
Vice President of Human Resources
Compensation as of Fiscal Year 2014.

Rotech Healthcare Inc. Key Developments

Rotech Healthcare Files Form 15

Rotech Healthcare Inc. has announced that it has filed a Form 15 with the Securities and Exchange Commission to voluntarily deregister its common stock, $0.0001 par value per share under the Securities Exchange Act of 1934, as amended.

Rotech Seeks Buyer

Rotech Healthcare Inc. (OTCPK:ROHI.Q) received bankruptcy court approval to send its proposed debt-for-equity-swap restructuring plan to creditors for a vote even as it pursues a possible sale. Interested buyers have until June 18, 2013 to submit initial offers for the company and final bids would be due later in the summer. Rotech is not obligated to accept an offer and can choose to exercise its fiduciary out. However, should Rotech decide to pursue a sale process rather than its current restructuring plan, it would file a new Chapter 11 plan and disclosure statement, Rotech said in court documents. The sale process, described by Rotech attorney Martin Bienenstock of Proskauer Rose LLP as a belt and suspenders backup, will ensure that shareholders or creditors are not being deprived of anything under the proposed restructuring transaction. Offers for the Rotech would have to provide at least $150 million more in value than the current transaction in order for equity holders to receive anything, Bienenstock said.

Rotech Healthcare Inc. Enters into New Term Loan Credit Agreement

Rotech Healthcare Inc. entered into a new term loan credit agreement with Silver Point Finance, LLC, as administrative agent thereunder and SPCP Group, LLC, as initial lender thereunder (the Credit Agreement) relating to a term loan credit facility (the Facility) in an aggregate principal amount of $25 million. Pursuant to the Credit Agreement, the company borrowed $23.5 million of the Facility on December 21, 2012. The remaining $1.5 million portion of the Facility that is not borrowed at such time (such portion, the Delayed Draw Facility) may be borrowed on or before January 1, 2014 so long as certain limited conditions as set forth in the Credit Agreement are satisfied. The Facility replaces and repays commitments and loans under Credit Agreement, dated as of March 17, 2011 and, assuming the Company will borrow $1.5 million under the Delayed Draw Facility, increases available liquidity in the company by approximately $15 million. In addition to repaying amounts outstanding under the 2011 Credit Agreement and fees and expenses associated with the Facility, the proceeds of the Facility should provide the company with additional flexibility to address anticipated competitive changes and opportunities in the industry and working capital needs supporting the company's business plans. The loans under the Facility will mature on April 30, 2015. The Credit Agreement does not require any amortization payments in respect of the loans and the entire principal amount is due at maturity. All borrowings under the Facility participate in a first priority security interest in substantially all of the company's and the subsidiary guarantor's assets with the Company's $230 million in aggregate principal amount of 10.75% senior secured notes due October 15, 2015. Amounts under the Facility bear interest at the LIBOR Rate (as defined in the Credit Agreement) plus 10.0% per annum or, at the Company's option, a fluctuating rate (defined as ABR in the Credit Agreement) plus 9.0% per annum. Interest is payable monthly. The default rate under the Facility is 3.0% per annum above the otherwise applicable interest rate. A ticking" fee on the commitments in respect of the Delayed Draw Facility in an amount equal to 500 basis points per annum will begin accruing from March 31, 2013 to the Delayed Draw Termination Date and shall be due and payable in cash on a monthly basis. To the extent the Company or any of its restricted subsidiaries obtain net cash proceeds from the incurrence of indebtedness not permitted to be incurred pursuant to the Credit Agreement, issuances of equity by the company, asset sales or insurance/condemnation events, mandatory prepayments of the loans will be required, subject to exceptions set forth in the Credit Agreement. Such mandatory prepayments and any voluntary prepayments are subject to a premium of 6.0% in the case of a prepayment made on or prior to December 31, 2013 and 3.0% in the case of a prepayment made on or after January 1, 2014 through and including December 31, 2014. Prepayments made on or after January 1, 2015 are not subject to a premium. Any commitment reductions in respect of the Delayed Draw Facility after March 31, 2013 are subject to a premium of 6%. As set forth in the Credit Agreement, the Facility contains negative covenants that further limit the company's ability to incur indebtedness and grant liens on its assets. In addition, as described in the Credit Agreement, the company is required to maintain compliance, to be tested on a quarterly basis, with financial covenants consisting of a minimum trailing twelve month EBITDA; a minimum fixed charge coverage ratio and a maximum total leverage ratio.

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