The Dolan Company DM, a leading provider of professional services and
business information to the legal, financial and real estate sectors in the
United States, today announced that it has amended its senior lending
agreement, restructured its Florida operations of National Default Exchange,
or NDeX, and is commenting on its third quarter results.
The company has amended its existing bank agreement with its current lending
group to reset its covenant ratios and make certain other changes. “We are
pleased with the changes to our bank agreement and the greater flexibility it
will provide to us,” said Vicki Duncomb, chief financial officer. Details of
this amendment are included in the company's Form 8-K filed today with the
Securities and Exchange Commission.
The company also said it has restructured its NDeX Florida operations in order
to provide its proprietary technology to the Albertelli law firm in
consideration for licensing fees and other financial considerations. NDeX
returned existing processing operations to the law firm. Had the restructuring
occurred on January 1, 2012, the company's 2012 annual revenues would have
been reduced by $10-$12 million but the company's EBITDA from continuing
operations would be increased by at least $1 million. The company said NDeX
remains committed to the Florida market.
This restructuring is considered a triggering event under GAAP and the company
has been required to assess whether the goodwill of its NDeX reporting unit
has been impaired. Given the current depressed operating results of the
mortgage default processing industry, the company has determined that certain
of the finite-lived intangible assets of NDeX as well as the goodwill have
been impaired. Accordingly, the company plans to record a non-cash, pre-tax
charge for impairment of these assets of up to $165 million in the third
quarter. Details regarding the restructuring and impairment charge are
included in the company's Form 8-K filed today with the Securities and
Exchange Commission, and the final amount of the impairment is expected to be
announced in connection with third quarter results in early November.
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