CPS Announces Placement of $25 Million in Subordinated Debt Agreement For Improved Securitization Structures.IRVINE, Calif.--(BUSINESS WIRE)--Nov. 18, 1998--Consumer Portfolio Services Inc. (Nasdaq:CPSS CPSS Committee on Payment and Settlement Systems CPSS Commission on Public Secondary Schools CPSS Cincinnati Prehospital Stroke Scale (STR - Smile, Talk, Raise both arms) CPSS Certified Professional Soil Scientist ) Wednesday announced that it has completed a private placement of $25 million in subordinated notes with Levine Leichtman Capital Partners II L.P. (LLCP LLCP Limited Liability Corporation ), a California limited The California Limited was one of the named passenger trains of the Atchison, Topeka and Santa Fe Railway and a true "workhorse" of the railroad. It was assigned train Nos. 3 & 4, and its route ran from Chicago, Illinois to Los Angeles, California. partnership. In conjunction with the financing, LLCP will receive warrants to purchase approximately 14 percent of the company's fully diluted common stock. Following the close of the transaction the company also announced the appointment of Arthur E. Levine, a principal of LLCP, to the company's board of directors. Levine Leichtman Capital Partners is a private investment firm with in excess of $400 million of institutional capital for investment in middle market companies primarily headquartered in the Western United States Noun 1. western United States - the region of the United States lying to the west of the Mississippi River West Santa Fe Trail - a trail that extends from Missouri to New Mexico; an important route for settlers moving west in the 19th century . The firm provides debt and equity capital to companies for growth and expansion. Levine stated, "We are very pleased to make an investment in Consumer Portfolio Services Inc. We believe the company is a leader in its industry and has a strong and experienced management team." In addition, the company announced that it had entered into an agreement with Financial Security Assurance Inc. ("FSA FSA Financial Services Authority FSA Food Standards Agency (UK) FSA Farm Service Agency (USDA) FSA Financial Services Agency (Japan) ") to provide financial guarantee insurance policies for up to $560 million of automobile receivables. The agreement calls for the company to post an initial cash credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing of 3.0 percent of the receivables in each of the next two securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. transactions. In conjunction with this agreement, the company has agreed to grant FSA, on behalf of itself and its reinsurers, warrants to purchase up to approximately 10 percent of the company's fully diluted common stock. "We are pleased to have completed these important financing transactions and are looking forward to a long and mutually beneficial relationship with our partners," reported Charles E. Bradley, Jr., the company's president and chief executive officer. Consumer Portfolio Services is a purchaser, seller and servicer of installment sales contracts secured by automobiles, vans, and light trucks. The company purchases contracts from over 4,000 dealers in 40 states and services a portfolio in excess of $1.5 billion. |
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