Nighthawk Announces Completion Of Settlement Transaction With St. Paul Radiology, P.A.
SCOTTSDALE, Ariz., June 30, 2010 (GLOBE NEWSWIRE) -- NightHawk Radiology Holdings, Inc. (Nasdaq:NHWK), the leading provider of radiology solutions to radiology groups across the United States, today announced that, effective June 30, 2010, it has completed its settlement transaction with St. Paul Radiology, P.A. As a result of the settlement transaction, NightHawk sold to a third party its ownership interests in Midwest Physicians Services, LLC and Emergency Radiology Services, LLC, the parties settled all disputes between them and terminated all of the agreements entered into in connection with the July 2007 transaction between the parties. Consistent with NightHawk's previous disclosures in its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010 filed with the Securities and Exchange Commission on May 7, 2010, NightHawk will receive aggregate consideration of $26 million in connection with the settlement transaction, $12 million of which NightHawk received at closing and $14 million of which will be paid to NightHawk over the next four years. In addition, NightHawk expects to realize tax savings of approximately $10 million related to the settlement, for a total expected value of the settlement of approximately $36 million over four years.
In order to complete the settlement transaction, NightHawk received consent from its lenders under its credit agreement. In connection with that consent, on June 30 th, NightHawk paid to the Lenders a principal repayment of $26 million. Also, as part of the consent, NightHawk has agreed to make an additional principal repayment of $10 million on or before June 30, 2011, for a total expected principal repayment of $36 million.
Additional details regarding the settlement transaction, a description of the material agreements entered into in connection with the transaction, NightHawk's principal payment to its lenders and other financial information related to the transaction will be filed on a Current Report on Form 8-K on or before Wednesday, July 7, 2010.
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