RESTON, VA, Jan 10, 2008 (MARKET WIRE via COMTEX News Network) -- Comstock Homebuilding Companies, Inc. (NASDAQ: CHCI) ("Comstock" or
the "Company") today announced that it entered into an agreement with
the Noteholder of its $30.0 million senior unsecured notes (the
"Noteholder") whereby the Company has the option until March 10, 2008
to either: (i) retire the $30.0 million senior secured notes in full
upon the payment of $15.0 million ("Cash Closing"), or (ii) secure a
$15.0 million reduction in the outstanding principal amount of the
notes by paying $8.0 million in cash and issuing the Noteholder a
warrant for the purchase of one million shares of the Company's Class
A Common Stock with a seven-year term at an exercise price of $0.70
per share ("Financed Closing"). Under the terms of the agreement the
Company posted a non-refundable deposit of $250,000 to be applied at
closing. The Company is currently evaluating its options with
respect to funding of the closing and has until February 29, 2008 to
notify the Noteholder as to which option, if any, it will exercise.
In the event the Company elects to proceed with the Financed Closing,
the current $30.0 million notes will be replaced by notes with, among
other things, a principal balance of $7.0 million, a five year
maturity, less restrictive financial covenants (with compliance
waived until June 30, 2008) and no prepayment penalties.
About Comstock Homebuilding Companies, Inc.
Established in 1985, Comstock Homebuilding Companies, Inc. is a
publicly traded, diversified real estate development firm with a focus
on affordably priced for-sale residential products. Comstock builds
and markets single-family homes, townhouses, mid-rise condominiums,
high-rise condominiums, mixed-use urban communities and active adult
communities. The company currently markets its products under the
Comstock Homes brand in the Washington, DC; Raleigh, North Carolina;
and Atlanta, Georgia metropolitan areas. Comstock Homebuilding
Companies, Inc. trades on NASDAQ under the symbol CHCI. For more
information on the Company or its projects please visit
www.comstockhomebuilding.com.
Cautionary Statement Regarding Forward-Looking Statements
This release contains "forward-looking" statements that are made
pursuant to the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995. Statements that are predictive in
nature, that depend upon or refer to future events or conditions, or
that include words such as "may," "will," "expects," "projects,"
"anticipates," "estimates," "believes," "intends," "plans," "should,"
"seeks," and similar expressions, including statements related to
Comstock's expected future financial results and anticipated growth
in the Washington DC housing market, are forward-looking statements.
Forward-looking statements involve known and unknown risks and
uncertainties that may cause future results to differ materially from
those projected or contemplated in the forward-looking statements.
These risks and uncertainties include, but are not limited to,
economic, market and competitive conditions affecting Comstock and
its operations and products, risks and uncertainties relating to the
market for real estate generally and in the areas where Comstock has
projects, the availability and price of land suitable for
development, materials prices, labor costs, interest rates,
Comstock's ability to service its significant debt obligations,
fluctuations in operating results, anticipated growth strategies,
continuing relationships with affiliates, environmental factors,
government regulations, the impact of adverse weather conditions or
natural disasters and acts of war or terrorism. Additional
information concerning these and other important risks and
uncertainties can be found under the heading "Risk Factors" in the
Company's most recent form 10-K, as filed with the Securities and
Exchange Commission on March 16, 2007. Comstock specifically
disclaims any obligation to update or revise any forward-looking
statements, whether as a result of new information, future
developments or otherwise.
SOURCE: Comstock Homebuilding Companies, Inc.