Key Developments For Comstock Homebuilding Companies, Inc.
Comstock Homebuilding Companies, Inc. (CHCI.O) (Consolidated Issue listed on NASDAQ Capital Market)
Comstock Homebuilding Companies, Inc. Settles Litigation With Cornerstone Bank And Eliminates $5.2 Million of Debt
Comstock Homebuilding Companies, Inc. announced that it has concluded its negotiations and entered into a settlement agreement and mutual release with Cornerstone Bank relating to previously announced litigation between the Company and Cornerstone. In connection with the settlement, Cornerstone has released the Company, and its subsidiary Mathis Partners, LLC, from their respective obligations and guarantees relating to $5.2 million of debt owed by the Company to Cornerstone. The debt was guaranteed by the Company and related to an acquisition and construction loan originally provided by Haven Trust Bank in connection with a single family development project in Atlanta, Georgia known as The Gates of Luberon. Under the terms of the settlement agreement, the parties have agreed to dismiss all pending litigation against each other, and Cornerstone has unconditionally released the Company from its obligations and guarantees relating to the debt in exchange for an immediate cash payment to Cornerstone of $50,000 and the delivery to Cornerstone of a non-interest bearing unsecured subordinate note in the amount of $400,000 with a three year term. As a result of completing the negotiations in September, the Company will write off the remaining carrying value of the Project and reduce the recorded value of the debt to the final settlement amount and expects to record a gain on troubled debt restructuring of approximately $1.2 million during the quarter ending September 30, 2009.
Comstock Homebuilding Companies, Inc. Announces Departure of CFO, Bruce Labovitz
Comstock Homebuilding Companies, Inc. announced that effective May 22, 2009 Bruce Labovitz, formerly the Chief Financial Officer(CFO), is no longer employed by the Company. Jeff Dauer, the Chief Accounting Officer, has assumed the Chief Financial Officer position on an interim basis.
Comstock Homebuilding Companies, Inc. Announces Resignation Of Bruce Labovitz As CFO-Form 8-K
Comstock Homebuilding Companies, Inc. reported in its Form 8-K that effective as of May 20, 2009, Bruce Labovitz, Chief Financial Officer (CFO) is no longer employed by the Company. Jeff Dauer, the Company's Chief Accounting Officer, will assume Mr. Labovitz's duties on an interim basis.
Comstock Homebuilding Companies, Inc. Announces Restructuring Of $13.5 Million Penderbrook Debt
Comstock Homebuilding Companies, Inc. announced that they have entered into a forbearance agreement with Guggenheim Corporate Funding with respect to the $13.5 million outstanding under the Company's secured Penderbrook project loan. The Company had previously reported receiving a notice of default from Guggenheim on August 22, 2008. In connection with the forbearance agreement the original maturity date of the loan was extended from February 22, 2010, to March 6, 2011. The terms of the forbearance agreement provide for additional incremental extensions until March 6, 2012 provided certain unit delivery requirement thresholds are met. Under the terms of the forbearance agreement the interest rate in effect for each calendar year will be determined on the last day of the year, retroactively for the year, based upon the cumulative unit settlements during the year. The interest rate will start to step down from a high of LIBOR + 1400 bps to a floor of LIBOR + 400 bps each year based on a range of seven to twenty unit settlements occurring in 2009, and a range of sixteen to twenty-six unit settlements in 2010.
Comstock Homebuilding Companies, Inc. Restructures $22 Million Debt Outstanding With Wachovia
Comstock Homebuilding Companies, Inc. announced and certain of its subsidiaries (collectively Comstock or the Company) announced that they have entered into various loan modification agreements with Wachovia Bank, N.A. (Wachovia) with respect to the approximately $22.2 million outstanding under the Company's secured borrowing base facility (the Borrowing Base). Under the terms of a loan modification and forbearance agreement and three note agreements the outstanding balance of the Company's Borrowing Base, along with the associated real estate collateral, was distributed between three new loan facilities, an $8.0 million construction revolver, an $11.6 million term loan and a $3.0 million project loan. The Borrowing Base represented the Company's only outstanding indebtedness to Wachovia. Under the terms of a new $8.0 million construction revolver, the Company and Wachovia refinanced 33 lots from the Borrowing Base which represented $3.3 million of the Company's outstanding balance prior to the modifications.Under the terms of a new $11.6 million term loan, the Company and Wachovia refinanced 453 lots from the Borrowing Base which represented $11.6 million of the Company's outstanding balance prior to the modifications.Under the terms of a new $3.0 million project loan, the Company and Wachovia refinanced the Company's 167-lot Tribble Road development project in Atlanta, Georgia.
