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DCAP Group, Inc. (NASDAQ: DCAP), the largest chain of independent
storefront insurance agencies in the Northeast, today announced that its
subsidiary, Payments, Inc. completed the sale of its premium finance
loan portfolio to Premium Financing Specialists, Inc. (“PFS”).
In addition, the companies entered into an agreement whereby loans
originated by Payments, Inc. will be sold to PFS subject to certain
conditions.
“We are delighted to announce the completion
of the transaction,” said Barry Goldstein,
President of Payments, Inc. and CEO of DCAP. “We
are proud to have built a viable profitable and vibrant finance company
from scratch. We cannot now originate the volume of loans needed to
continue our operations as a full-service provider. The new relationship
with PFS allows Payments, Inc to continue to work with our loyal
customer base, to generate the same loans, but instead of retaining them
for its portfolio, Payments is selling them to PFS, a national large
scale enterprise with detailed knowledge of the local markets Payments,
Inc. serves. In lieu of earning interest and fee income and absorbing
the costs associated, Payments will generate income which will vary with
volume and loan size. The total dollar amount of the loans sold was
$13.1 million including deferred finance charges of $1.0 million.
Substantially all of the proceeds of sale were used to repay Payments
Inc.’s credit line and other outstanding
liabilities with regard to its premium finance business.”
PFS Personal Lines President, Jeffrey Scott, indicated, “We
couldn’t be more pleased to be collaborating
with Payments, Inc. We look forward to providing their customers with
the highest level of service and providing ample capacity to Payments in
any environment.”
About DCAP Group
DCAP Group, Inc. owns and operates the largest chain of independent
storefront insurance agencies in the Northeast. Through DCAP Insurance,
Barry Scott Insurance, Atlantic Insurance Agency and Accurate Agency,
DCAP Group provides automobile insurance (and to a lesser extent,
motorcycle and homeowners), enhanced by complimentary premium financing
capabilities, to retail customers in New York and Pennsylvania. Other
products include automobile club service for roadside emergencies and
income tax preparation services. As of February 1, 2008, DCAP had 69
owned or franchised storefront locations.
Forward Looking Statements
Statements in this press release may contain “forward-looking
statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements, other than
statements of historical facts, may be forward-looking statements. These
statements are based on management’s current
expectations and are subject to uncertainty and changes in
circumstances. These statements involve risks and uncertainties that
could cause actual results to differ materially from those included in
forward-looking statements due to a variety of factors. More information
about these factors can be found in Item 6 of DCAP’s
latest Annual Report filed with Securities and Exchange Commission under
Form 10-KSB. The company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.