FirstCity Financial Corporation Announces Debt Refinancing; Expects to Recognize Related Pre-Tax Gain in Excess of $25 Million
FirstCity Financial Corporation (Nasdaq: FCFC) today announced that it has refinanced its existing senior credit facility with Bank of Scotland and BoS(USA) (collectively, "Bank of Scotland"). As a result, FirstCity's debt obligation under its existing credit facility was reduced and divided into two separate loan facilities with Bank of Scotland. In connection with the Company's debt refinancing, FirstCity also closed on a new credit facility with Bank of America. The significant terms and conditions of these amended and new credit facilities are summarized below.
As a result of this debt refinancing, FirstCity expects to recognize a one-time, non-cash gain in excess of $25 million (or $2.43 per share diluted) during the fourth quarter of 2011. This transaction is also expected to increase the Company's stockholders' equity by at least $25 million, net of applicable income taxes, as FirstCity is effectively reducing the carrying amount of debt on its balance sheet.
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