CHARLOTTE, N.C., Aug. 28, 2012 /PRNewswire/ -- MedCath
Corporation (Nasdaq: MDTH) announced that the Company's Board of
Directors today approved a distribution of $6.33 per share, payable in cash on September 21, 2012 to holders of record of the
Company's common stock, par value $.01 (the "Common Stock") on September 10, 2012 (the "Pre-Filing Liquidating
Distribution"). The approval of the Pre-Filing
Liquidating Distribution followed the Board of Director's
determination that the conditions outlined in the Company's proxy
statement filed with the Securities and Exchange Commission (the
"SEC") on August 17, 2011 (the
"Proxy"), to make an additional liquidating distribution prior to
the Filing (as defined below), had been met. The amount of the
Pre-Filing Liquidating Distribution is consistent with the high end
of the anticipated distribution range described in MedCath's Form
10-Q filed with the SEC on August 9,
2012.
MedCath's Board of Directors has approved the filing of a
certificate of dissolution with the Secretary of State of the
State of Delaware on September 21, 2012 (the "Filing"). Trading in the
common stock on the NASDAQ Global Select Market will be suspended
after the regular market officially closes at 4 p.m. EDT on September
21, 2012. MedCath will then close its stock transfer books
and not record any further transfers of its common
stock on its books except by will, intestate succession or
operation of law.
"We are pleased to have achieved this important
milestone," said Art Parker,
MedCath's President and CEO. "In March
2010, we set a goal to maximize stockholder value given the
difficult regulatory and business environment in which we were
operating. We believe that we have accomplished that, as we will
have distributed a total of $13.18
per share to our stockholders once we pay this Pre-Filing
Liquidating Distribution."
To provide a source of funds for contingencies the Company
may incur during the wind-down period following the Filing, the
Board of Directors has elected to hold back $48.0 million, or $2.36 per common share, of cash (the
"Holdback"). The Holdback is not intended to
satisfy the Company's recorded wind-down liabilities of
approximately $23.8 million that have
already been reflected in the Company's Consolidated Statements of
Net Assets in Liquidation as of June 30,
2012 on Form 10-Q filed with the SEC on August 9, 2012. The
amount of the Holdback does not take into consideration any
potential tax benefits that the Company may realize during the
wind-down period. The Company has adopted a Rights Agreement, which
was amended on August 28, 2012, that
is intended to preserve for the Company's stockholders the value or
availability of certain of the Company's beneficial tax attributes,
but there can be no assurances that the Rights Agreement will
prevent an "ownership change" under and as defined in Section 382
of the Internal Revenue Code of 1986, as
amended. After the Company has satisfied or
made reasonable provision for all its liabilities in accordance
with the Company's Plan of Dissolution and the Delaware General
Corporation Law, any remaining assets (including any unused portion
of the Holdback or potential tax benefits realized by the Company)
will be distributed to stockholders of record as of the close of
business on the date of the Filing on a pro rata basis in one or
more post-filing liquidating distributions (the "Post Filing
Liquidating Distributions"). The amount and timing of such
Post-Filing Liquidating Distributions, if any, are currently
unknown.
The Company filed a Current Report on Form 8-K with the
Securities and Exchange Commission reporting the approval of the
Pre-Filing Liquidating Distribution, the Company's intention to
make the Filing on September 21, 2012
and other information, including the Company's amendment to the
Rights Agreement and the Company's intent to seek relief
from the periodic reporting requirements it is
currently subject to under the Securities Exchange Act of
1934. Investors should review carefully all the
information in the 8-K report before making an investment decision
with respect to MedCath's common stock. A copy
of the 8-K report is available from the SEC at
www.sec.gov, or on our website,
www.medcath.com.
About MedCath
MedCath Corporation, headquartered in Charlotte, N.C., was a health care provider
focused on high acuity services with the diagnosis and treatment of
cardiovascular disease being a primary service offering. Having now
divested all of its hospitals, MedCath is focused on fulfilling
transition service obligations to the purchaser of one of its
previously owned hospitals, realizing the value of its remaining
assets; making tax and regulatory filings; winding down its
remaining business activities, managing its known and unknown
contingencies, and making distributions to its stockholders as part
of its Plan of Dissolution.
All statements relating to the Holdback and any potential
tax benefits that may be realized by the Company during the
wind-down period are forward-looking statements. The amount of the
Holdback could be more or less than the amount necessary to resolve
all of the Company's contingencies if one or more of the underlying
assumptions or expectations the Board of Directors used in setting
the Holdback proves to be inaccurate. Certain important factors,
risks and uncertainties that could cause the actual amount of the
Company's potential unknown contingencies to differ materially from
the Holdback are described in the risk factors included in the
Proxy and the Company's Annual Report on Form 10-K for the year
ended September 30, 2011 as amended,
filed with the SEC on December 14,
2011. The forward-looking
statements included in this report speak only as of the date of
this report or the date they were otherwise
made. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or
otherwise.
SOURCE MedCath Corporation