SquareTwo Financial Corporation, a leader in the distressed asset purchasing market in the United States and Canada, announced the early settlement of its previously announced exchange offer and the implementation of its comprehensive recapitalization plan.
The early settlement of the Exchange Offer closed on May 24, 2016 following the company's acceptance for purchase of $224,811,000 aggregate principal amount of the Company's 11.625% Senior Second Lien Notes due 2017 (the "2017 Notes"). At the early settlement, SquareTwo also entered into a supplemental indenture removing certain covenants and events of default from the indenture governing the 2017 Notes.
As part of the recapitalization, the company also obtained a new $165 million credit facility consisting of a $105 million term loan facility and a $60 million revolving loan facility. In addition, the company entered into a new $30 million credit facility underwritten by certain holders of the 2017 Notes, of which $15 million was funded upon the early settlement of the Exchange Offer and the remaining $15 million will be available to the company to fund future portfolio acquisitions, subject to certain conditions.
"SquareTwo is well positioned with its proprietary operating model in the United States and Canada to continue performing as a leader in the distressed asset purchase and management industry. This recapitalization positions us for intelligent growth," said SquareTwo President and Chief Executive Officer Paul A. Larkins. "We have continued to make significant investments in our operating and compliance platforms, primarily through advanced analytics and technology, which position us for long-term success."
SquareTwo's legal advisor in connection with the recapitalization is Hogan Lovells US LLP and its investment banker is Evercore.
SquareTwo Financial Corporation is a leader in the distressed asset purchasing industry. SquareTwo's primary business is the acquisition, management and collection of charged-off consumer and commercial accounts receivable that are purchased from financial institutions, finance and leasing companies, and other issuers in the United States and Canada.