Comstock Homebuilding Companies Enters Into New $40 Million Loan and Executes Restructuring of Its $30 Million Senior Unsecured
March 14 2008 - 4:24PM
Marketwired
RESTON, VA ("Comstock" or the "Company") today announced that
the Company and two of its subsidiary entities had closed on a
series of financing transactions that refinanced key project loans
of the Company, restructured the Company's $30.0 million senior
unsecured notes (the "Unsecured Notes"), provided the Company with
a $15.0 million discount to the principal amount of the Unsecured
Notes, and provided the Company with additional working
capital.
On March 14, 2008 the Company entered into a new three-year
$40.0 million revolving loan facility (the "New Loan") with KeyBank
National Association (the "Lender"). Proceeds from the New Loan
were used to: (i) refinance the Company's Eclipse at Potomac Yard
project which was previously financed by Corus Bank and had a
principal balance of approximately $22.0 million, (ii) refinance
the Company's Townes at Station View project which was previously
financed by Key Bank and had a principal balance of approximately
$2.8 million, (iii) facilitate the Company's closing on the
restructure of its Unsecured Notes thereby securing a $15.0 million
discount to the original principal amount of the Unsecured Notes,
(iv) pay costs associated with closing the New Loan, and (v)
provide the Company with additional working capital. The New Loan
has no quarterly financial covenants, other then periodic minimum
principal curtailment requirements commencing in March 2009.
In a separate transaction, also on March 14, 2008, the Company
executed on its previously disclosed option to restructure its
Unsecured Notes. In connection therewith the Company made a $6.0
million principal payment to the Noteholder and entered into an
amended and restated indenture with the Noteholder with a new
principal balance of $9.0 million and a revised term of 5 years
(the "Restated Indenture"). As a result, the Company received a
$15.0 million discount to the original principal amount due to the
Noteholder.
Details of both transactions will be discussed in more detail as
subsequent events in the Company's upcoming filing on Form 10-K for
fiscal year 2007, which the Company expects to file on March 24,
2008. The Company also announced that it had received its 2007
federal tax refund and that it had retired the previously announced
$4.0 million working capital loan to Stonehenge Funding, LC.
"We are very pleased to report these significant
accomplishments," said Christopher Clemente, Chief Executive
Officer. "While current market conditions continue to present
challenges, these accomplishments help solidify our capital base,
improve our balance sheet, and provide operating liquidity."
The Company will hold an investor conference call on Tuesday,
March 25, 2008 at 1:00 p.m. Eastern Time hosted by Christopher
Clemente, Chief Executive Officer and Bruce Labovitz, Chief
Financial Officer. To participate in the call by telephone, the
domestic dial-in number is 800-769-8320 and the international
dial-in is 416-695-9719. There is no access code required.
Investors are advised to join at least five minutes prior to the
call to register. The call will also be available via live webcast
on the Comstock Homebuilding Companies' website at
http://www.comstockhomebuilding.com in the "Investor Relations"
section. The call will be archived for seven days: from 5:00 p.m.
on March 25, 2008, until 11:59 p.m. on April 1, 2008. Domestic
callers can access the replay at 800-408-3053 and international
callers can access the replay at 416-695-5800. The replay access
code is 3253806.
About Comstock Homebuilding Companies, Inc.
Established in 1985, Comstock Homebuilding Companies, Inc. is a
publicly traded, diversified real estate development firm with a
focus on affordable priced for-sale residential products. Comstock
builds and markets single-family homes, townhouses, mid-rise
condominiums, high-rise condominiums, mixed-use urban communities
and active adult communities. The company currently markets its
products under the Comstock Homes brand in the Washington DC;
Raleigh, North Carolina; and Atlanta, Georgia metropolitan areas.
Comstock Homebuilding Companies, Inc. trades on NASDAQ under the
symbol CHCI. For more information on the Company or its projects
please visit www.comstockhomebuilding.com.
Cautionary Statement Regarding Forward-Looking Statements
This release contains "forward-looking" statements that are made
pursuant to the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995. Statements that are predictive in
nature, that depend upon or refer to future events or conditions,
or that include words such as "may," "will," "expects," "projects,"
"anticipates," "estimates," "believes," "intends," "plans,"
"should," "seeks," and similar expressions, including statements
related to Comstock's expected future financial results and
anticipated growth in the Washington DC housing market, are
forward-looking statements. Forward-looking statements involve
known and unknown risks and uncertainties that may cause future
results to differ materially from those projected or contemplated
in the forward-looking statements. These risks and uncertainties
include, but are not limited to, economic, market and competitive
conditions affecting Comstock and its operations and products,
risks and uncertainties relating to the market for real estate
generally and in the areas where Comstock has projects, the
availability and price of land suitable for development, materials
prices, labor costs, interest rates, Comstock's ability to service
its significant debt obligations, fluctuations in operating
results, anticipated growth strategies, continuing relationships
with affiliates, environmental factors, government regulations, the
impact of adverse weather conditions or natural disasters and acts
of war or terrorism. Additional information concerning these and
other important risks and uncertainties can be found under the
heading "Risk Factors" in the Company's most recent form 10-K, as
filed with the Securities and Exchange Commission on March 16,
2007. Comstock specifically disclaims any obligation to update or
revise any forward-looking statements, whether as a result of new
information, future developments or otherwise.
Contact: Bruce Labovitz Email Contact 703.230.1131
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