Matrix Bancorp (NASDAQ:MTXC)
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From May 2019 to May 2024
Matrix Bancorp, Inc. (NASDAQ:MTXC) (the "Company")
announced today that its wholly owned subsidiary, Equi-Mor Holdings,
Inc. ("Equi-Mor"), has sold all of its membership interests in ABS
Schools Services, LLC ("ABS"), a provider of financing and
administrative business services to charter schools, to SKS Ventures,
LLC ("SKS") for approximately $7.4 million. The principal members of
SKS are D. Mark Spencer, Richard V. Schmitz and David Kloos, the
former Co-Chief Executive Officers and former Chief Financial Officer
of the Company, respectively. Matrix Capital Bank, a subsidiary of the
Company, provided SKS with $4 million in financing for the
transaction. The closing of the transaction took place on Friday, May
5, 2006.
Prior to the execution of the agreement, ABS distributed its
outstanding interests in Charter Facilities Funding, LLC and New
Century Academy Property Management Group, LLC to Equi-Mor. ABS also
distributed certain other assets to Equi-Mor as well as outstanding
deferred and current income tax balances related to ABS. Based on the
purchase price, a $1.0 million pre-tax charge was recorded in the
first quarter, included in discontinued operations, to reflect the net
realized value of the ABS interests upon the sale.
SKS assumed all liabilities associated with the ABS loan portfolio
transferred to SKS, including ABS' approximately $5.4 million recourse
obligation to a third party financial institution. Equi-Mor has
provided a five-year guarantee of up to $1.65 million for the existing
ABS loan portfolio and the obligations to that financial institution.
Management anticipates a charge of approximately $800,000 to $1.0
million will be recorded in the second quarter in the Company's
financial statements to reflect this recourse obligation.
If SKS resells ABS within one year of the agreement, 50% of any
gain on sale is payable to Equi-Mor, after adjustment for certain post
closing events. The Company guaranteed the obligations of its
subsidiary Equi-Mor under the agreement. The three former executive
officers of the Company guaranteed the obligations of SKS under the
agreement and were co-borrowers on the $4 million financing with
Matrix Capital Bank.
In discussing the sale, Michael J. McCloskey, Chief Operating
Officer of the Company, commented: "We are pleased to announce what we
believe to be a mutually beneficial sale for both Matrix Bancorp and
SKS Ventures, LLC. This sale allows Matrix Bancorp to take another
step toward our goal of re-positioning the company as a traditional
community bank serving the Colorado Front Range market. ABS and its
employees have proved valuable to Matrix Bancorp's operations over the
years; however, with the Company's redirection toward community
banking, ABS' business no longer coincides with our new strategy. We
thank the former ABS employees for their important contributions to
Matrix and wish them well in their new endeavor."
Denver-based Matrix Bancorp, Inc. is focused on developing its
community-based banking network through its Matrix Capital Bank
subsidiary by strategically positioning branches across Colorado's
Front Range market. The Bank plans to grow its network to an estimated
five to seven community-based branches over the next three to five
years. The Company recently identified "United Western" as its
proposed new brand name and anticipates a formal change in legal and
trade names during second or third quarter of 2006, after receiving
applicable regulatory and shareholder approvals.
At December 31, 2005, the Company reported total consolidated
assets of $2.1 billion, total loans of $1.4 billion, total deposits of
$1.1 billion and total consolidated shareholders equity of $180.7
million (includes proceeds used for the Company's January 2006 tender
offer). For more information, please visit www.matrixbancorp.com.
Certain statements contained in this press release that are not
historical facts, including, but not limited to, statements that can
be identified by the use of forward-looking terminology such as "may,"
"will," "expect," "anticipate," "predict," "believe," "plan,"
"estimate" or "continue" or the negative thereof or other variations
thereon or comparable terminology, are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995, and involve a number of risks and uncertainties. The actual
results of the future events described in such forward-looking
statements in this press release could differ materially from those
stated in such forward-looking statements. Among the factors that
could cause actual results to differ materially are: the timing of
regulatory approvals or consents for contemplated actions; the
successful negotiation of a mutually acceptable definitive agreement;
general economic conditions; competition; the delay in or failure to
receive any required shareholder approvals of the contemplated
actions; the risks and uncertainties discussed elsewhere in the
Company's Annual Report on Form 10-K for the year ended December 31,
2005, filed with the Securities and Exchange Commission on March 15,
2006; and the uncertainties set forth from time to time in the
Company's periodic reports, filings and other public statements.