PRGX (NASDAQ NM)
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PRG-Schultz Obtains Commitment for Bridge Financing; Company Reports Continued Progress in Financial Restructuring
MONDAY , NOVEMBER 28, 2005 07:40 AM
ATLANTA, Nov 28, 2005 (BUSINESS WIRE) -- PRG-Schultz International, Inc. (Nasdaq: PRGX), today
announced that Parkcentral Global Hub, Blum Strategic Partners II, and
certain of their affiliates have committed to supply $8 million of
bridge financing, pending a restructuring of the company's 4 3/4%
convertible notes due November 26, 2006. The bridge financing, which
will mature on the earlier of May 15, 2006 or the closing of such
restructuring, will be used for general corporate purposes, including
the payment of interest on the convertible notes prior to the end of
the 30-day grace period that commenced on November 28, 2005. The
bridge financing remains subject to several conditions, including
completion of diligence and documentation.
"We are grateful for the continuing support of Parkcentral and
Blum, and look forward to the support of our other major lenders as we
work to improve our capital structure," said James B. McCurry,
PRG-Schultz's President and Chief Executive Officer. "The funds that
would be made available under the bridge financing allow us to remain
current on our public debt and provide additional working capital
while we focus on completing our financial restructuring discussions."
As previously announced, an ad hoc committee of convertible note
holders has been organized to negotiate the terms of a potential
restructuring of the convertible notes. Negotiations are ongoing at
this time, and the company anticipates reaching a mutually acceptable
resolution with the ad hoc committee in the near future. Affiliates of
Parkcentral and Blum are members of the ad hoc committee.
About PRG-Schultz International, Inc.
Headquartered in Atlanta, PRG-Schultz International, Inc. (PRG) is
the world's leading profit improvement firm, providing clients
throughout the world with insightful value to optimize and expertly
manage their business transactions. Using proprietary software and
expert audit methodologies, PRG industry specialists review client
purchases and payment information to identify and recover
overpayments.
Forward Looking Statements
Statements made in this news release that look forward in time,
including statements regarding the company's ability to negotiate
successfully with the ad hoc committee, the acceptance of the results
of such negotiations by its other convertible note holders, and the
company's ability to successfully close the bridge financing, involve
risks and uncertainties and are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
risks and uncertainties include the inherent risks involved in any
contract negotiation. Should the company be unable to close the bridge
financing it will have to seek alternative sources of financing in
order to obtain sufficient liquidity to make the interest payment
under the convertible notes, and there is no guarantee that such
financing will be available on acceptable terms, if at all. There is
no guarantee that the company will be able to consummate the bridge
financing, restructure its notes, or raise additional financing on
acceptable terms. Any such restructuring would be expected to result
in a significant dilution of the outstanding equity of the company.
Anticipated future expense savings may not be realized as anticipated
or could have unexpected adverse effects on the company's revenue
stream. For a discussion of other risk factors that may be impact the
company's business, please see our Securities and Exchange Commission
filings, including the company's Form 10-K as filed with the
Securities and Exchange Commission on March 16, 2005 and Form 10-Qs as
filed May 10, 2005, August 9, 2005 and November 9, 2005. The company
disclaims any obligation or duty to update or modify these
forward-looking statements.
SOURCE: PRG-Schultz International, Inc.
PRG-Schultz International, Inc., Atlanta
James E. Moylan, Jr., 770-779-6605