AG Mortgage Investment Trust, Inc. Reports Fourth Quarter Earnings

NEW YORK–(BUSINESS WIRE)–
AG Mortgage Investment Trust, Inc. (“MITT” or the “Company”) (NYSE: MITT – News) today reported net income for the quarter ended December 31, 2011 of $5.8 million and net book value of $20.52 per share.
FINANCIAL HIGHLIGHTS

• Net income of $5.8 million, or 0.58 per share for the fourth quarter
• Net income of $19.0 million, or $3.20 per share for the period from March 7, 2011 to December 31, 2011
• Core Earnings of $6.5 million or $0.65 per share for the quarter
• Core Earnings of $12.4 million, or $1.24 per share for the period from July 6, 2011 (the consummation of our initial public offering) to December 31, 2011
• Net realized gains of $2.9 million, or $0.29 per share, on Agency RMBS for the fourth quarter and $7.2 million, or $0.72 per share, for the period from July 6, 2011 to December 31, 2011
• Net realized losses of ($3.5) million, or ($0.35) per share, on credit investments for the fourth quarter and for the period from July 6, 2011 to December 31, 2011
• $0.70 per share dividend declared for the fourth quarter and $1.10 per share dividends declared for the period ended December 31, 2011
• Approximately $0.46 per share of undistributed taxable income as of December 31, 2011(1)
• $20.52 net book value per share as of December 31, 2011(1)

INVESTMENT HIGHLIGHTS

• $1.4 billion investment portfolio value as of December 31, 2011 (2) (4)
• 5.86x leverage as of December 31, 2011 (2) (3)
• 91.0% Agency RMBS investment portfolio (4)
• 9.0% credit investment portfolio, comprising Non-Agency RMBS, CMBS and ABS assets (4)
• 5.0% constant prepayment rate (“CPR”) for the fourth quarter on the Agency RMBS investment portfolio (5)
• 2.25% net interest margin as of December 31, 2011 (6)

FOURTH QUARTER 2011 AND PERIOD ENDED DECEMBER 31, 2011 RESULTS
AG Mortgage Investment Trust, Inc. is an actively managed REIT that opportunistically invests in a diversified risk-adjusted portfolio of Agency RMBS, Non-Agency RMBS, CMBS and ABS. For the fourth quarter, the Company had net income of $5.8 million, or $0.58 per diluted share, and Core Earnings of $6.5 million, or $0.65 per diluted share. For the period from March 7, 2011 to December 31, 2011, the Company had net income of $19.0 million, or $3.20 per diluted share (7), and for the period from July 6, 2011 to December 31, 2011 (“period ended December 31, 2011”), the Company had Core Earnings of $12.4 million, or $1.24 per diluted share. Core Earnings represents a non-GAAP financial measure and is defined as net income (loss) excluding (i) net realized gain (loss) on investments and terminations on derivative contracts and (ii) net unrealized appreciation (depreciation) on investments and derivative contacts. (See “Non-GAAP Financial Measure” below for further detail on Core Earnings)
David Roberts, Chief Executive Officer, commented “We are pleased to announce our fourth quarter earnings. During the quarter, Core Earnings increased to $0.65 per share and we announced our first full quarter dividend of $0.70 per share. In addition to meeting our financial goals, we continued to diversify funding relationships and in January we were able to successfully complete an equity raise which has improved our stock’s liquidity. We are proud of our accomplishments over the last two quarters and look forward to the opportunities ahead.”
“Amidst uncertainty in the global markets, European liquidity difficulties and year-end funding pressures, we continued to optimize our Agency portfolio, opportunistically rotate the credit portfolio and retain capital for potential market dislocations,” said Jonathan Lieberman, Chief Investment Officer. “While Agency RMBS yields have compressed, we believe the low interest rate environment and a carefully selected investment portfolio will continue to support attractive risk-adjusted returns. Over the course of the quarter, we rotated a significant portion of the Agency portfolio into securities with more favorable prepayment attributes to further mitigate prepayment risk. Allocations to credit securities were concentrated in less volatile short duration Non-Agency securities and CMBS tranches with superior intrinsic value. We believe MITT is well positioned to continue to produce sustainable returns and take advantage of the opportunities ahead in both the Agency RMBS and credit markets. With the success of the European Central Bank’s Long-Term Refinancing Operation, funding risks have materially declined and we anticipate deploying capital in a more aggressive style. New capital from our January equity transaction allows greater latitude to the investment team to selectively increase our capital allocation to credit opportunities.”

KEY STATISTICS (2)
		Weighted Average at						Weighted Average
		December 31, 2011						at September 30, 2011
Investment portfolio		$	1,388,006,801					$	1,332,205,377
Repurchase agreements		$	1,189,303,407					$	1,126,859,885
Stockholders’ equity		$	206,283,920					$	207,413,703
Leverage ratio		5.86x			(3	)		5.70x			(3	)
Swap ratio			66	%	(8	)			51	%	(8	)
Yield on investment portfolio			3.16	%	(9	)			3.26	%	(9	)
Cost of funds			0.91	%	(10	)			0.82	%	(10	)
Net interest margin			2.25	%	(6	)			2.44	%	(6	)
Management fees			1.49	%	(11	)			1.43	%	(11	)
Other operating expenses			1.57	%	(12	)			1.58	%	(12	)
Book value, per share		$	20.52		(1	)		$	20.64		(1	)
Dividend, per share		$	0.70					$	0.40

INVESTMENT PORTFOLIO
The following summarizes the Company’s investment portfolio as of December 31, 2011 (2):

														Weighted Average
		Current Face			Premium (Discount)				Amortized Cost		Fair Value			Coupon		Yield
Agency RMBS:
15-Year Fixed Rate		$	738,344,948		$	22,525,476			$	760,870,424	$	772,310,909		3.32	%	2.62	%
20-Year Fixed Rate			227,566,114			7,362,001				234,928,115		237,586,837		3.69	%	3.00	%
30-Year Fixed Rate			232,890,169			12,162,512				245,052,681		246,679,482		3.99	%	3.18	%
Interest Only			43,505,596			(34,046,500	)			9,459,096		6,636,871		5.50	%	3.45	%
Non-Agency RMBS			102,246,062			(8,980,754	)			93,265,308		90,368,316		5.90	%	6.31	%
CMBS			19,500,000			(5,411,965	)			14,088,035		13,537,851		5.88	%	13.44	%
ABS			21,046,150			(34,497	)			21,011,653		20,886,535		4.50	%	4.50	%
Total		$	1,385,099,039		$	(6,423,727	)		$	1,378,675,312	$	1,388,006,801		3.81	%	3.16	%

As of December 31, 2011, the weighted average yield on the Company’s investment portfolio was 3.16% and its weighted average cost of funds was 0.91%. This resulted in a net interest margin of 2.25% as of December 31, 2011. (6)
The CPR for the Agency RMBS portfolio was 5.0% for the fourth quarter and 5.0% for the month of December 2011. (5)
The weighted average cost basis of the Agency investment portfolio, excluding interest-only securities, was 103.5% as of December 31, 2011. The amortization of premiums (net of any accretion of discounts) on Agency securities for the fourth quarter was $1.9 million, or $(0.19) per share. The unamortized net Agency premium as of December 31, 2011 was $42.0 million.
Premiums and discounts associated with purchases of the Company’s securities are amortized or accreted into interest income over the estimated life of such securities, using the effective yield method. Since the cost basis of the Company’s Agency securities, excluding interest-only securities, exceeds the underlying principal balance by 3.5% as of December 31, 2011, slower actual and projected prepayments can have a meaningful positive impact, while faster actual or projected prepayments can have a meaningful negative impact on the Company’s asset yields.
We have also entered into “to-be-announced” (“TBA”) positions to facilitate the future purchase of Agency RMBS. Under the terms of these TBAs, the Company agrees to purchase, for future delivery, Agency RMBS with certain principal and interest specifications and certain types of underlying collateral, but the particular Agency RMBS to be delivered are not identified until shortly before (generally two days) the TBA settlement date. At December 31, 2011, we had $100 million net notional amount of TBA positions with a net weighted average purchase price of 103.8%. As of December 31, 2011, our TBA portfolio had a net weighted average yield at purchase of 3.01% and a net weighted average settlement date of February 5, 2012. We have recorded derivative assets of $1.4 million and derivative liabilities of $0.5 million, reflecting these TBA positions.
LEVERAGE AND HEDGING ACTIVITIES
The investment portfolio is financed with repurchase agreements as of December 31, 2011 as summarized below:

		Agency RMBS						Non-Agency RMBS / CMBS / Other
Repurchase Agreements Maturing Within:		Balance			Weighted Average Rate			Balance			Weighted Average Rate
30 days or less		$	652,002,000		0.35	%		$	68,187,000		1.74	%
31-60 days			334,825,407		0.42	%			1,749,000		1.95	%
61-90 days			118,340,000		0.37	%			14,200,000		1.80	%
Greater than 90 days			-		-				-		-
Total / Weighted Average		$	1,105,167,407		0.37	%		$	84,136,000		1.75	%

As of December 31, 2011, the Company had entered into repurchase agreements with twenty-one counterparties. We continue to rebalance our exposures to counterparties and add new counterparties.
We have entered into interest rate swap agreements to hedge our portfolio. The Company’s swaps as of December 31, 2011 are summarized as follows:

Maturity		Notional Amount			Weighted Average Pay Rate			Weighted Average Receive Rate*			Weighted Average Years to Maturity
2012		$	100,000,000		0.354	%		0.285	%		0.14
2013			182,000,000		0.535	%		0.286	%		1.78
2014			204,500,000		1.000	%		0.395	%		2.54
2015			184,025,000		1.412	%		0.380	%		3.56
2016			87,500,000		1.625	%		0.328	%		4.63
2018			35,000,000		1.728	%		0.511	%		6.88
Total/Wtd Avg		$	793,025,000		1.008	%		0.350	%		2.72
* Approximately 50% of our interest rate swap notionals reset monthly based on one-month LIBOR and 50% of our interest rate swap notionals reset quarterly based on three-month LIBOR.

TAXABLE INCOME
The primary differences between taxable income and GAAP net income include (i) unrealized gains and losses associated with investment and derivative portfolios are marked-to-market in current income for GAAP purposes, but excluded from taxable income until realized or settled, (ii) temporary differences related to amortization of net premiums paid on investments (iii) the timing and amount of deductions related to stock-based compensation and (iv) excise taxes. As of December 31, 2011, the Company had undistributed taxable income of approximately $0.46 per share.
DIVIDEND
On December 14, 2011, the Company declared a dividend of $0.70 per share of common stock to stockholders of record as of December 30, 2011 and paid such dividend on January 27, 2012. The Company declared dividends of $1.10 per share for the period ended December 31, 2011.
SUBSEQUENT EVENT
On January 24, 2012, the Company completed a follow-on offering of 5,000,000 shares of its common stock and subsequently issued an additional 750,000 shares of common stock pursuant to the underwriters’ over-allotments at a price of $19.00 per share, for gross proceeds of approximately $109.3 million. Net proceeds to the Company from the offerings were approximately $104.1 million, net of issuance costs of approximately $5.2 million.
SHAREHOLDER CALL
The Company invites shareholders, prospective shareholders and analysts to attend MITT’s fourth quarter earnings conference call on March 1, 2012 at 11:00 am Eastern Time. The shareholder call can be accessed by dialing (888) 424-8151 (U.S. domestic) or (847) 585-4422 (international). Please enter code number 8732511#.
A presentation will accompany the conference call and will be available on the Company’s website at www.agmit.com. Select the Q4 2011 Earnings Presentation link to download and print the presentation in advance of the shareholder call.
An audio replay of the shareholder call combined with the presentation will be made available on our website after the call. The replay will be available until midnight on March 15, 2012. If you are interested in hearing the replay, please dial (888) 843-7419 (U.S. domestic) or (630) 652-3042 (international). The conference ID number is 8732511#.
For further information or questions, please contact Allan Krinsman, the Company’s General Counsel, at (212) 883-4180 or akrinsman@angelogordon.com.
ABOUT AG MORTGAGE INVESTMENT TRUST, INC.
AG Mortgage Investment Trust, Inc. is a real estate investment trust that invests in, acquires and manages a diversified portfolio of residential mortgage assets, other real estate-related securities and financial assets. AG Mortgage Investment Trust, Inc. is externally managed and advised by AG REIT Management, LLC, a subsidiary of Angelo, Gordon & Co., L.P., an SEC-registered investment adviser that specializes in alternative investment activities.
Additional information can be found on the Company’s website at www.agmit.com.
ABOUT ANGELO, GORDON & CO.
Angelo, Gordon & Co. was founded in 1988 and has approximately $22 billion under management. Currently, the firm’s investment disciplines encompass five principal areas: (i) distressed debt and leveraged loans, (ii) real estate, (iii) mortgage-backed securities and other structured credit, (iv) private equity and special situations and (v) a number of hedge fund strategies. Angelo, Gordon & Co. employs over 250 employees, including more than 90 investment professionals, and is headquartered in New York, with associated offices in Amsterdam, Chicago, Los Angeles, London, Hong Kong Seoul, Shanghai, Sydney and Tokyo.
FORWARD LOOKING STATEMENTS
This press release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on estimates, projections, beliefs and assumptions of management of the Company at the time of such statements and are not guarantees of future performance. Forward-looking statements involve risks and uncertainties in predicting future results and conditions. Actual results could differ materially from those projected in these forward-looking statements due to a variety of factors, including, without limitation, changes in interest rates, changes in the yield curve, changes in prepayment rates, the availability and terms of financing, changes in the market value of our assets, general economic conditions, market conditions, conditions in the market for Agency securities, and legislative and regulatory changes that could adversely affect the business of the Company. Additional information concerning these and other risk factors are contained in the Company’s most recent filings with the Securities and Exchange Commission (“SEC”). Copies are available on the SEC’s website, http://www.sec.gov/. The Company does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.

AG Mortgage Investment Trust, Inc. and Subsidiaries
Consolidated Balance Sheets
			December 31, 2011			April 1, 2011
Assets			(Unaudited)
Real Estate securities, at fair value
Agency – $1,186,149,842 pledged as collateral			$	1,263,214,099		$	-
Non-Agency – $47,227,005 pledged as collateral				58,787,051			-
CMBS – $2,747,080 pledged as collateral				13,537,851			-
ABS – $4,526,620 pledged as collateral				4,526,620			-
Linked transactions, net, at fair value				8,787,180			-
Cash and cash equivalents				35,851,249			1,000
Restricted cash				3,037,055			-
Interest receivable				4,219,640			-
Derivative assets, at fair value				1,428,595			-
Prepaid expenses				317,950			-
Due from broker				341,491
Due from affiliates				104,994			-
Deferred costs				52,176			-
Total Assets			$	1,394,205,951		$	1,000
Liabilities
Repurchase agreements			$	1,150,149,407		$	-
Payable on unsettled trades				18,759,200			-
Interest payable				2,275,138			-
Derivative liabilities, at fair value				7,908,308			-
Dividend payable				7,011,171			-
Due to affiliates				770,341			-
Accrued expenses				668,552			-
Due to broker				379,914			-
Total Liabilities				1,187,922,031			-
Stockholders’ Equity (Deficit)
Common stock, par value $0.01 per share; 450,000,000 and 1,000 shares of common stock authorized and 10,009,958 and 100 shares issued and outstanding at December 31, 2011 and April 1, 2011, respectively				100,100			1
Additional paid-in capital				198,228,694			999
Retained earnings				7,955,126			-
				206,283,920			1,000
Total Liabilities & Equity			$	1,394,205,951		$	1,000

AG Mortgage Investment Trust, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
							Period from
			Quarter Ended				March 7, 2011 to
			December 31, 2011				December 31, 2011
Net Interest Income
Interest income			$	10,022,275			$	18,748,669
Interest expense				1,106,097				1,696,344
				8,916,178				17,052,325
Other Income (Loss)
Net realized gain (loss)				(589,747	)			3,701,392
Gain (loss) on linked transactions, net				(1,013,291	)			(808,564	)
Realized loss on periodic interest settlements of interest rate swaps, net				(1,175,788	)			(2,162,290	)
Unrealized gain (loss) on derivative instruments, net				70,663				(6,491,430	)
Unrealized gain (loss) on real estate securities				1,346,237				11,040,692
				(1,361,926	)			5,279,800
Expenses
Management fee to affiliate				770,341				1,512,898
Other operating expenses				811,372				1,566,642
Equity based compensation to affiliate				97,343				176,165
Excise tax				105,724				105,724
				1,784,780				3,361,429
Net Income (Loss)			$	5,769,472			$	18,970,696
Earnings Per Share of Common Stock
Basic			$	0.58			$	3.20
Diluted			$	0.58			$	3.20
Weighted Average Number of Shares of Common Stock Outstanding
Basic				10,009,958				5,933,930
Diluted				10,010,799				5,933,930
Dividends Declared per Share of Common Stock			$	0.70			$	1.10

Non-GAAP Financial Measure
This press release contains Core Earnings, a non-GAAP financial measure. AG Mortgage Investment Trust’s management believes that this non-GAAP measure, when considered with GAAP, provides supplemental information useful in evaluating the results of the Company’s operations. This non-GAAP measure should not be considered a substitute, or superior to, the financial measures calculated in accordance with GAAP. Our GAAP financial results and the reconciliations from these results should be carefully evaluated.
Core Earnings are defined by the Company as net income excluding both realized and unrealized gains (losses) on the sale or termination of securities, including underlying linked transactions and derivatives. As defined, Core Earnings include the net interest earned on these transactions, including credit derivatives, linked transactions, inverse Agency securities, interest rate derivatives or any other investment activity that may earn net interest. One of the objectives of the Company is to generate net income from net interest margin on the portfolio and management uses Core Earnings to measure this objective.
A reconciliation of GAAP net income to Core Earnings for the quarter and period ended December 31, 2011 is set forth below:

						Period from
		Quarter Ended				March 7, 2011 to
		December 31, 2011				December 31, 2011
Net income/loss		$	5,769,472			$	18,970,696
Add (Deduct):
Net realized gain			589,747				(3,701,392	)
Gain/loss on linked transactions, net			1,013,291				808,564
Net interest income on linked transactions			554,729				900,638
Unrealized gain/loss on derivative instruments, net			(70,663	)			6,491,430
Unrealized gain/loss on real estate securities			(1,346,237	)			(11,040,692	)
Core Earnings		$	6,510,339			$	12,429,244

Footnotes
(1) Per share figures are calculated using outstanding shares including all shares granted to our Manager and our independent directors under our equity incentive plans as of quarter end.
(2) Generally when we purchase a security and finance it with a repurchase agreement, the security is included in our assets and the repurchase agreement is separately reflected in our liabilities on our balance sheet. For securities with certain characteristics (including those which are not readily obtainable in the market place) that are purchased and then simultaneously sold back to the seller under a repurchase agreement, US GAAP requires these transactions be netted together and recorded as a forward purchase commitment. Throughout this press release where we disclose our investment portfolio and the repurchase agreements that finance it, including our leverage metrics, we have un-linked the transaction and used the gross presentation as used for all other securities. This presentation is consistent with how the Company’s management evaluates the business, and believes provides the most accurate depiction of the Company’s investment portfolio and financial condition.
(3) Calculated by dividing total repurchase agreements, including $39.2 million included in linked transactions, plus payable on unsettled trades on our GAAP balance sheet by our GAAP stockholders’ equity.
(4) The total investment portfolio is calculated by summing the fair market value of our Agency RMBS, Non-Agency RMBS, CMBS and ABS assets, including linked transactions. The percentage of Agency RMBS and credit investments are calculated by dividing the respective fair market value of each, including linked transactions, by the total investment portfolio.
(5) This represents the weighted average monthly CPRs published during the period for our in-place portfolio during the same period.
(6) Net interest margin is calculated by subtracting the weighted average cost of funds from the weighted average yield for the Company’s investment portfolio, which excludes cash held by the Company. See footnotes (9) and (10) for further detail.
(7) Diluted per share figures are calculated using weighted average outstanding shares in accordance with GAAP. For the period from March 7, 2011 to December 31, 2011, the calculation reflected the impact of 100 shares outstanding from July 1, 2011 through the settlement date of our IPO.
(8) The swap ratio was calculated by dividing the notional value of our interest rate swaps by total repurchase agreements, including those included in linked transactions, plus payable on unsettled trades.
(9) The yield on our investment portfolio during the period represents an effective interest rate, which utilizes all estimates of future cash flows and adjusts for actual prepayment and cash flow activity as of quarter end. This calculation excludes cash held by the Company.
(10) The cost of funds was calculated as the sum of the weighted average rate on the repurchase agreements outstanding at quarter end and the weighted average net pay rate on our interest rate swaps. Both elements of the cost of funds were weighted by the repurchase agreements outstanding at quarter end.
(11) The management fee percentage at quarter end was calculated by annualizing management fees incurred during the quarter and dividing by quarter-ended stockholders’ equity.
(12) The other operating expenses percentage at quarter end was calculated by annualizing other operating expenses recorded during the quarter and dividing by quarter-ended stockholders’ equity.
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Saxo Bank Scoops 4 Awards at the Social Forex Awards 2011

SINGAPORE–(Marketwire -02/27/12)- Saxo Bank, the online trading and investment specialist, has won no less than four Awards at the inaugural Social Forex Awards 2011.
Saxo Bank ranked number one in the following categories:

• Most Social Bank (through the use of Social Media tools such as LinkedIn, Facebook and Twitter
• Best Social Campaign
• Best Social Initiative/Innovation
• Best Social Research

The Bank ranked second in a further three categories: Best iPhone/iPad app, Best Online Content and Most Social Website. Of 8 categories Saxo Bank was ranked in all but one.
The awards recognise the outstanding players in the industry and were presented by LetstalkFX and Social-Markets.net, in conjunction with e-Forex magazine and were sponsored by The Chicago Mercantile Exchange. The votes were cast by members of the letstalkFX.com community and marketing was undertaken by the Bank using LinkedIn and Facebook.
Disclaimer:Saxo Capital Markets Pte. Ltd. (“Saxo Capital Markets”) is licensed as a Capital Market Services provider and an Exempt Financial Advisor, and is supervised by the Monetary Authority of Singapore.
You should carefully consider whether trading in leveraged products is appropriate for you in the light of your financial circumstances. You should be aware that dealing in products that are highly leveraged carry significantly greater risk than non-geared investments such as share trading. As such, you could both gain and lose large amounts of money. You may sustain losses in excess of the moneys you initially deposit and also in excess of the margin required to establish and maintain any positions in leveraged products.
For further information, please see:
http://sg.saxomarkets.com/about-us/general-disclaimer
About Saxo Capital Markets
Saxo Capital Markets Pte Ltd is a wholly-owned subsidiary of Saxo Bank A/S, the Copenhagen-headquartered online trading and investment specialist. It serves as the Asia Pacific headquarters and holds a Capital Markets Services license from the Monetary Authority of Singapore. Saxo Capital Markets also holds a Commodity Broker licence from The International Enterprise Singapore.
Clients can trade Forex, CFDs, Stocks, Futures, Options and other derivatives via SaxoWebTrader and SaxoTrader, its leading multi-asset online trading platforms.
SaxoTrader is available directly through Saxo Capital Markets or through one of its institutional clients. White labelling is a significant business area for Saxo Capital Markets, and involves customising and branding of its online trading platform for other financial institutions and brokers.
About Saxo Bank
Saxo Bank is a leading online trading and investment specialist. A fully licensed and regulated European bank, Saxo Bank enables private investors and institutional clients to trade FX, CFDs, ETFs, Stocks, Futures, Options and other derivatives via three specialised and fully integrated trading platforms: the browser-based SaxoWebTrader, the downloadable SaxoTrader and the SaxoMobileTrader application available in over 20 languages. Saxo Bank also offers professional portfolio and fund management through Saxo Asset Management who accommodates high-net-worth private clients and institutional investors and provides banking services and advice to retail clients through Saxo Privatbank. The Saxo Bank Group is headquartered in Copenhagen with offices throughout Europe, Asia, Middle East, Latin America and Australia.
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Remedies to help underwater homeowners not enough, PUSH panel says

BY MAUDLYNE IHEJIRIKA Staff Reporter mihejirika@suntimes.com February 25, 2012 8:36PM

Updated: February 25, 2012 9:42PM
Only strident remedies — such as a national moratorium on foreclosures and offering financial aid to “underwater” homeowners — can help stem a crisis sending severe reverberations through poor and minority communities, members of an Operation PUSH panel said Saturday.
Those communities will have to demand action through voting power and protest, seeking redress through legislative and legal means, because the recent settlement between the nation’s largest lenders and 49 state attorneys general shows they can’t count on government solutions, said the Rev. Jesse Jackson and other members of the panel.
“In the 1960s, we fought against restrictive covenants, then redlining, then for the Community Reinvestment Act. We finally get a rise in black and brown home ownership. Now this,” said Jackson, pointing to research showing the largest segment of “underwater” homes — where the amount owed exceeds the value of the home — are found in poor and minority communities.
“Much of this is race-based driven exploitation,” Jackson said. “We must now fight to recover our lost assets stolen from us and not protected by the government. We must connect our votes with our remedy.”
About 11 million households nationally are underwater.
The government bailout of banks that was supposed to help many of those households stave off foreclosure “have not helped nearly as much as it needs to,” asserted Woodstock Institute Vice President Spencer Cowan.
Nor, Cowan said, will the landmark $25 billion settlement reached last month with five top mortgage lenders, which helps only 1 million households.
“The $25 billion settlement is only a small aspect and doesn’t address the myriad other problems that led us to this point,” he said. “Nor does it address the two largest holders of mortgages, Fannie Mae and Freddie Mac.”
Others noted the crisis has pushed more of the middle-class into poverty.
“The only investment most middle-class people have is their home. Now these same people have no credit. If they can’t get a loan, their kids can’t go to college. You have a whole generation of people moving from middle-class to poverty,” said the Rev. Janette Wilson, PUSH Education Director.
The panel advocated criminal action against lenders who participated in the predatory and deceptive lending practices, issuing loans destined to fail.
“Find the people who robo-signed these loans, and start going after them. The $25 billion settlement doesn’t rule out criminal investigation of the banks for some of these other problems,” said Cowan.
Research by his group found in the six-county Chicago metropolitan region, the average underwater homeowner owes $50,000 more than their home’s value.
The number of homes hit with foreclosures in the region rose 13.9 percent in January from December — to 13,750 homes, or one in every 276 homes.http://tourism9.com/    http://vkins.com/

Experts split over private equity

Pension funds allocating their assets to private equity have reaped little or no rewards on average, according to a Yale study.
Martijn Cremers, associate professor of finance at the Yale School of Management, concluded in a recent paper that returns on private equity over the last 10 years were no better than the stock market. Investments in public equity were on average unlikely to yield more profit than investments in stocks or bonds, because of their high management fees. However, some experts disagreed with the findings, saying that private equity is still a good option for asset allocation.
According to the paper, private equity funds had a spectacular run in the 1990s where it returned an average net return of 21.5 percent to its investors. Impressed by this performance, institutional investors increased their investment in private equity, bringing the total funds in private equity from $200 million to $2 billion in the last 10 years. But the Midas touch of private equity disappeared at the turn of the century and the returns fell to an average of 4.5 percent in the last 10 years, the paper said.
“If I had to summarize it in a nutshell, pension funds got similar returns to what they would have gotten had they invested in passive equities,” Cremers said.
Since private equity is more volatile than stocks or bonds, a portfolio with a large asset allocation in it would have a high amount of risk. For example, the paper said, the net returns from private equity fell from a profit of 36 percent in 2000 to a loss of 21 percent the next year.
Even as the profits in private equity took a hit in the aftermath of the dot-com bubble, private equity fees continued to climb. Cremers explained that in addition to taking a cut from the share of returns, known as the performance fee, private equity managers also charge an overall management fee on the invested capital. He said the average management fee has increased from 2.4 percent in 2000 to 4.2 percent in 2010. Private equity fund managers have taken 70 percent of the gross profits made in the last decade as fees, Cremers said.
Steven Kaplan, professor of entrepreneurship and finance at the University of Chicago, disagreed with the findings. According to his research, every dollar a pension fund put into private equity earned 20 percent more than it would have in Standard & Poor’s 500 index. Accounting for management and performance fees, he said, private equity funds have outperformed public markets by an average of three percentage points over the past 20 years.
Kaplan pinned the drastic difference in results on unreliable data.
“Cremers does not have particularly good performance data [but] we do,” Kaplan said.
In the past several studies have relied on commercial data sets provided by Thomson Venture Economics, which is problematic for analysis, Kaplan said.
Ayako Yasuda, associate professor of management at the University of California, Davis, shed light on the problems of gathering definitive data. Unlike pension funds, private equity funds are not legally required to disclose their activities, so all data available is based on voluntary disclosure, which is subject to bias.
“What’s missing is not just random noise,” Yasuda said. “Even a very small percentage of the missing data could mean that it is being systematically obstructed, which could create hidden bias.”
The difficulty in collecting data about private equity makes the field’s performance uncertain, if not controversial, Kaplan said.
Yasuda contended that the 4.5 percent average return, which Cremers calculated, is no worse than the turbulent performance of the stock markets in the last decade.
“It’s a period in which the benchmark also performed poorly,” Yasuda said.
She agreed private equity funds tend to have higher fees than other investment asset classes, but said the performance fees are typically structured to avoid consuming all the net returns for investors in low-performance funds.
In an underperforming market, private equity fees may seem exorbitant, but they are within reason during economic booms, such as the 1990s, Deputy SOM Dean Andrew Metrick said. Compared to a hedge fund, private equity charges a lot less, he said.
Metrick said that private equity funds also allow its institutional investors to invest in buyouts and ventures as partners, which means that pension funds may bypass a large portion of the overall fee. Such transactions are not included in Cremers’ data because they are not available to the researchers, Metrick said.
The key for pension fund managers is to find the right private equity investments, which requires enormous skill and long-term dedication, Metrick said.
For the unsophisticated investor, making investments in private equity funds is “like throwing darts at a newspaper,” he said.
The paper was co-authored by Aleksandar Andonov and Rob Bauer of Maastricht University in the Netherlands.
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SEC Said to Look at Smaller Firms in Review of Private Equity Valuations

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Hotel industry looks for deal pace to pick up

LOS ANGELES (Reuters) – Hotel companies and real estate firms are optimistic that deal transactions will pick up this year despite concerns about Europe‘s economy and challenges in obtaining debt financing.
While a business-led economic recovery has helped lift U.S. hotel occupancy rates, development is still a soft spot as tight credit conditions have limited new-hotel builds. Still, there is a growing sense that the hotel sector has momentum and performance will continue to improve.
“People are expecting 2012 to be a pretty positive year, with solid performance by the industry in terms of the demand for hotel accommodations and the ability to get deals done,” Arthur de Haast, chairman of Jones Lang LaSalle Hotels, said at this week’s Americas Lodging Investment Summit.
The hotel investment services firm has forecast that hotel deals in the Americas this year will at least match the 2011 level in value of an estimated $15 billion.
U.S. hotel deal activity picked up in the first half of 2011 but calmed in the latter part of the year as debt woes in Europe began dominating the headlines.
While Europe is still a risk, attendees at the three-day hotel conference said a continued recovery marked by rising room rates would make the sector attractive for investment.
“There’s a lot of money on the sidelines waiting to pounce and find opportunities,” said Christian Charre, president and chief executive of the Charre Group, a Florida-based hotel brokerage and consulting firm.
FOREIGN MONEY
Private equity funds that have capital will be in a good position to make acquisitions, some said. Real estate investment trusts were active buyers in the first half of 2011 but are expected to be quieter this year as their share prices suffered in the latter part of 2011.
“The mix of the investors probably will change,” said Sri Sambamurthy, co-founder of real estate firm West Point Partners in New York. He said Middle Eastern, European and Asian investors especially find the U.S. market to be extremely attractive now.
“The U.S. is still considered very safe, the dollar has performed extraordinarily well,” Sambamurthy added.
Hotel companies said they were looking to make acquisitions in a bid to expand their reach.
“No question that we’ll be active in the marketplace in 2012,” said Paul Whetsell, president and chief executive of Loews Hotels, which owns and/or operates 18 hotels. The unit of Loews Corp has committed more than $500 million to acquiring hotels or developing new properties.
Whetsell said Loews is looking for 4-star or higher-rated hotels in major cities where it does not have a presence such as Boston, Washington, San Francisco, Chicago and Los Angeles, as well as smaller markets like Charlotte, North Carolina, and Baltimore, Maryland.
Choice Hotels International , which franchises hotels focused mainly at the mid-tier and economy market segments under brands such as Comfort Inn and Econo Lodge, said it is in the hunt to acquire a value-oriented, full-service upscale brand that would help attract more business customers.
“We clearly would be a very aggressive purchaser of brands that come up,” Choice Chief Executive Steve Joyce said in an interview [ID:nL2E8CO1IS].
(Editing by Gary Hill)
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Update: Adara Media Secures $12.4 M in Financing Led by August Capital

MOUNTAIN VIEW, CA–(Marketwire -01/24/12)- Global precision marketing platform company Adara Media Inc. has secured $12.4 million in funding from venture capital firm August Capital, with participation from returning investors ONSET Ventures, Morgenthaler Ventures, and Baseline Ventures. This financing will fuel increased investment in Adara Media’s award winning TruPrecision Targeting Platform, delivering highly targeted media and ecommerce campaigns based upon specific customer relevance across top travel and hospitality brands. It will also advance Adara Media’s mission to expand its platform into new verticals and invest in sales, marketing and operational resources.
The funding follows exponential spending increases from Adara Media’s clients in 2011. Working with complex customer data sets and valuable audience segments, such as frequent flyers, business and international travelers, Adara Media enables top brand advertisers to connect with a highly desired consumer base via online media channels.
“This new round of funding from an esteemed group of partners represents continued investment in the growth of our business,” says Layton Han, chief executive officer of Adara Media. “Our business has achieved revenue growth every month during 2011 and is now poised to grow more aggressively and efficiently. We’re excited to have the support of August Capital, and the continued backing of our original lead investor ONSET Ventures, and Morgenthaler Ventures, as we invest heavily in our platform development and continue to expand globally.”
Han added that Adara will also use the funding to take the TruPrecision platform into new vertical categories. The company’s growth in 2011 has come from travel, hospitality and closely related verticals. Through Adara Media’s TruPrecision Targeting Platform, brands can reach and activate more than 225 million traveler profiles.
Dave Marquardt and Tripp Jones of August Capital led the investment in Adara Media. “We pride ourselves on investing in companies that show entrepreneurial excellence and technical innovation,” said August Capital co-founder Dave Marquardt. “Adara Media and its management have shown that this platform can bring brands closer to their best customers through the use of technology. We’re excited about Adara’s future as they expand globally and develop into new verticals.”
Adara Media’s industry leadership has been acknowledged through many industry awards including AlwaysOn OnMedia 100, Red Herring North America, and the Mega Awards, hosted by Airline Information. Adara Media has recently established an office in Chicago and announced the promotion of Scott Garner to EVP of business strategy, now responsible for strategic partnerships as well as new product strategy.
About August Capital:
Founded in 1995, August Capital has funded an extraordinary group of entrepreneurs who have built significant, long-term value across the full range of information technologies. These companies represent an aggregate market capitalization of well over $250 billion, generate in excess of $75 billion in annual revenue around the world. This success is a testament to the entrepreneurs themselves, as well as the fundamental technologies they have created. August Capital has invested in more than 80 companies including Adchemy, Atheros, Cobalt Networks, Ebates, Postini, Reputation.com, SayMedia, Seagate Technology, Splunk, Xirrus, and Zulily. The firm’s partners have previously invested in a number of ground breaking technology companies, including Actel, Adaptec, Compaq, Grand Junction, Intuit, Linear Technology, Microsoft, MMC Networks, Skype, Sun Microsystems, Sybase, Symantec, and Visio. August Capital is located in Menlo Park, California. For more information, please visit: www.augustcap.com.
About ONSET Ventures:ONSET Ventures specializes in providing an ideal mix of start-up, follow-on, and intellectual capital to entrepreneurs and early-stage technology ventures, to help transform world-class ideas into sustainable and valuable businesses, through a process of “venture craftsmanship.” The firm has backed over 130 companies since 1984 and now has more than $1 billion under management. ONSET Ventures is located in Menlo Park, California. For more information, please visit: www.onset.com.
About Morgenthaler Ventures:Morgenthaler Ventures is a premier venture capital firm, dedicated to helping entrepreneurs build valuable companies for more than 40 years. Today, the firm has nearly $3 billion under management. Morgenthaler Ventures has invested in approximately 300 companies in the information technology and life science sectors. Representative portfolio companies in the IT space include: Adara Media, Evernote, Lending Club, Practice Fusion, Pageonce, Fundly, SohoOS, Socrata, Rhythm NewMedia, NexTag, Nominum, Voltage Security, JasperSoft and MuleSoft. Morgenthaler Ventures is headquartered in Menlo Park, CA.
About Baseline:As an early stage seed investment firm, Baseline helps founders develop their ideas into companies. Baseline has invested in more than 60 companies since its inception and helped more than 15 companies exit. Baseline is proud to be a seed investor associated with promising companies including Instagram, Twitter, Weebly, Formspring, Heroku (acquired by Saleforce.com), CoTweet (acquired by ExactTarget), GeoAPI (acquired by Twitter), IndexTank (acquired by LinkedIn), Rupture (aquired by EA), Sendori (aquired by Ask.com), Parakey (acquired by Facebook), Versely (acquired by Cisco), Aardvark and DocVerse (both acquired by Google).
About Adara Media:Adara Media offers a loyalty audience platform that enables top brands to monetize and nurture their loyalty program customers online and helps advertisers reach exclusive, qualified audiences. Using proprietary loyalty data, Adara Media enables advertisers to reach real individuals, ensuring authenticity while maintaining complete anonymity. Adara Media’s brand partners then gain ancillary revenue streams and the ability to deepen their relationships with loyalty consumers through targeted offers and consistent communication. Adara Media was founded in 2005 and is headquartered in Mountain View, CA. For more information, please visit http://www.adaramedia.com/.
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Adara Media Secures $12.4 M in Financing Led by August Capital

MOUNTAIN VIEW, CA–(Marketwire -01/24/12)- Global precision marketing platform company Adara Media Inc. has secured $12.4 million in funding from venture capital firm August Capital, with participation from existing investors Morgenthaler Ventures, Onset Ventures, and Baseline Ventures. This financing will fuel increased investment in Adara Media’s award winning TruPrecision Targeting Platform, delivering highly targeted media and ecommerce campaigns based upon specific customer relevance across top travel and hospitality brands. It will also advance Adara Media’s mission to expand its platform into new verticals and invest in sales, marketing and operational resources.
The funding follows exponential spending increases from Adara Media’s clients in 2011. Working with complex customer data sets and valuable audience segments, such as frequent flyers, business and international travelers, Adara Media enables top brand advertisers to connect with a highly desired consumer base via online media channels.
“This new round of funding from an esteemed group of partners represents continued investment in the growth of our business,” says Layton Han, chief executive officer of Adara Media. “Our business has achieved revenue growth every month during 2011 and is now poised to grow more aggressively and efficiently. We’re excited to have the support of August Capital, and the continued backing of our existing investors, as we invest heavily in our platform development and continue to expand globally.”
Han added that Adara will also use the funding to take the TruPrecision platform into new vertical categories. The company’s growth in 2011 has come from travel, hospitality and closely related verticals. Through Adara Media’s TruPrecision Targeting Platform, brands can reach and activate more than 225 million traveler profiles.
Dave Marquardt and Tripp Jones of August Capital led the investment in Adara Media. “We pride ourselves on investing in companies that show entrepreneurial excellence and technical innovation,” said August Capital co-founder Dave Marquardt. “Adara Media and its management have shown that this platform can bring brands closer to their best customers through the use of technology. We’re excited about Adara’s future as they expand globally and develop into new verticals.”
Adara Media’s industry leadership has been acknowledged through many industry awards including AlwaysOn OnMedia 100, Red Herring North America, and the Mega Awards, hosted by Airline Information. Adara Media has recently established an office in Chicago and announced the promotion of Scott Garner to EVP of business strategy, now responsible for strategic partnerships as well as new product strategy.
About August Capital:
Founded in 1995, August Capital has funded an extraordinary group of entrepreneurs who have built significant, long-term value across the full range of information technologies. These companies represent an aggregate market capitalization of well over $250 billion, generate in excess of $75 billion in annual revenue around the world. This success is a testament to the entrepreneurs themselves, as well as the fundamental technologies they have created. August Capital has $1.3 billion under management, and has invested in more than 75 companies including Atheros, Cobalt Networks, Iridigm, Mimosa Systems, Postini, Seagate, Shopping.com, SixApart and Silicon Image. Recent investments range from $500,000 to $130 million in information technology businesses from semiconductors to ecommerce. The firm’s partners have previously invested in a number of ground breaking technology companies, including Actel, Adaptec, Compaq, Grand Junction, Intuit, Linear Technology, Microsoft, MMC Networks, Skype, Sun Microsystems, Sybase, Symantec, and Visio. August Capital is located in Menlo Park, California. For more information, please visit: www.augustcap.com.
About Adara Media:Adara Media offers a loyalty audience platform that enables top brands to monetize and nurture their loyalty program customers online and helps advertisers reach exclusive, qualified audiences. Using proprietary loyalty data, Adara Media enables advertisers to reach real individuals, ensuring authenticity while maintaining complete anonymity. Adara Media’s brand partners then gain ancillary revenue streams and the ability to deepen their relationships with loyalty consumers through targeted offers and consistent communication. Adara Media was founded in 2005 and is headquartered in Mountain View, CA. For more information, please visit http://www.adaramedia.com/.
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Sikich Investment leads recapitalization of FiberLink

Article updated: 1/18/2012 12:34 AM
By Marketwire

CHICAGO — Sikich Investment Banking said it completed a recapitalization of FiberLink LLC, an owner of regional fiber optic routes between Chicago and Denver and Chicago and New Orleans.
Sikich served as the exclusive placement agent to FiberLink, securing financing from Silicon Valley-based Bridge Bank. The proceeds were used to recapitalize the company.
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Sikich Investment Banking’s Capital Markets team specializes in approaching capital markets from a comprehensive and strategic perspective, and designing customized financing structures to help fulfill growth strategies for clients at acceptable levels of risk. The team, led by Mark Solovy, head of the Capital Markets group, worked closely with FiberLink’s management to structure the transaction, prepare offering materials, conduct the financing process, assist with investor due diligence, and ultimately negotiate the terms of the final transaction.
“Mark and his Sikich colleagues have a very broad network of investor relationships, as well as financing expertise with emerging growth companies,” said Kenneth D. Anderson, chairman of FiberLink. “The team clearly understands the unique characteristics and challenges of emerging growth technology companies in accessing the ever-changing competitive capital markets, and was able to structure a transaction with terms which were advantageous for FiberLink.”
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Newly Launched Hyde Park Venture Partners Makes First Investment in Virtual Store Research

HPVP is a newly-launched venture capital fund investing in high-growth technology companies in Chicago and the Midwest. As its first investment, it has chosen the growing field of online virtual store research, co-leading the $1.5 million funding of InContext Solutions.
Chicago, IL (PRWEB) January 08, 2012
A new early-stage investor has emerged in the growing entrepreneurship and technology landscape of Chicago: Hyde Park Venture Partners (HPVP). Its first investment is in InContext Solutions, a pioneer in web-based 3-D virtual store environments. HPVP, along with Hyde Park Angels, co-led InContext Solutions’ recent $1.5 million round of equity funding. The consortium of investors also included leading graphics and computing company, AMD.
HPVP is an early-stage venture capital fund investing in technology companies in the Midwest, with particular focus in Chicago.
“We are proud to add HPVP to our financial partners and to be recognized among Chicago’s technology leaders,” said Bob Gillespie, CEO and co-founder of InContext Solutions. “We plan to continue to grow our software offering and to lead innovation in virtual store research and in collaborative product and store planning.”
“InContext Solution’s unique offering and experienced management team are exactly what we look for in a company,” said Guy Turner, managing director of HPVP. “In the retail and consumer manufacturing world, speed is critical to staying on the shelf and ahead of the competition. Thanks to InContext Solutions, product and packaging decisions that used to take months can be completed in a matter of weeks. We are excited for what will come next.”
About InContext Solutions

InContext Solutions is an award-winning technology and market research firm specializing in online 3-D environment simulations with applications in virtual store research, collaborative store planning, and e-commerce. The company’s research delivers highly accurate behavioral and attitudinal insights into shopper behavior, while its collaborative software tools allow many of the world’s best-loved consumer brands to make more effective decisions around product and store planning, environment design and other in-store revenue drivers. As a next-generation e-commerce platform, InContext Solutions’ vision is to drive online sales through lifelike user experiences that engage, entertain and captivate with 3-D audio-visual elements.
For more information, visit http://incontextsolutions.com/.
About Hyde Park Venture Partners

Hyde Park Venture Partners (HPVP) is a venture capital fund investing in early stage technology companies in the Midwest, with particular focus in Chicago. HPVP invests in technology-enabled business and consumer services and healthcare IT companies raising their first or second round of institutional capital.
HPVP draws on its strategic relationship with Hyde Park Angels (HPA) to provide industry and business expertise to its portfolio companies through a network of more than 90 seasoned business executives, entrepreneurs and service professionals. HPVP’s principals and the HPA network take an active role in mentoring and guiding portfolio companies in product development, business strategy, financing and exit through both formal director roles and informal mentorship relationships.
For more information, visit http://www.hydeparkvp.com/.
# # #
Chiara Piccinotti
InContext Solutions
312-462-4491
Email Information

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HFF Expands Presence with Opening of Denver Office and Hiring of Three Production Specialists

DENVER–(BUSINESS WIRE)– HFF announced today that it will expand its presence by opening a full-service office in Denver with an immediate focus on debt placement, equity placement, loan sales and investment sales.
Day-to-day operations of the Denver office will be led by Eric Tupler, who joins HFF as a senior managing director. Joining Tupler will be managing director Mark Fallon, who has worked out of HFF’s Chicago office since November 2010 and specializes in loan sale advisory transactions. Executive managing director Jody Thornton, a member of HFF’s Executive Committee, is overseeing the Denver office expansion from HFF’s Dallas office.
Tupler, a former vice chairman at CBRE Capital Markets, has originated, structured, underwritten, placed and closed more than $6 billion of debt and equity real estate investments during his career. Tupler was the firm’s top Denver sales professional and the leader of the Denver Capital Markets group prior to his departure from CBRE. He was the recipient of many significant accomplishments during his 15-year tenure; he was the company’s number one national producer in debt and equity finance in 2004, awarded the Manager Innovation Award for Capital Markets in 2007, a six time Coldwell Colbert Circle Award recipient, which recognizes the top three percent of commissioned CB Richard Ellis salespeople worldwide, and a top 200 sales professional eight times. Tupler obtained his Masters of Business Administration from Florida Atlantic University and his Bachelor of Arts degree in marketing from the University of Maryland.
“I am extremely excited to begin the next chapter in my career by leading the new Denver office of HFF,” said Tupler. “The HFF platform is a truly a unique culture and fully integrated platform that will add tremendous value for our clients.”
Also joining Tupler at HFF are directors Brock Cannon and Josh Simon, both former vice presidents at CBRE Capital Markets. Cannon will work as part of HFF’s national loan sale advisory group alongside Mark Fallon. Cannon began his career in Houston, Texas working in the CBRE Capital Markets headquarters and his experience includes debt and equity originations, loan servicing and loan sales. Cannon has closed over $3 billion in transactions throughout his career. Simon specializes in debt and equity placement of all property types and has closed more than $3 billion in transactions during his career. Simon brings extensive experience in the placement, underwriting, and structuring of multi-housing financing and is a licensed real estate broker in Colorado.
“Although HFF has consummated a number of high-profile debt and investment sales assignments in the Denver MSA, HFF has waited for the best people to open an office and expand into the Denver market. We are excited about the opportunity to better serve our existing and future clients in the Rocky Mountain region with the team of Tupler, Cannon, Simon and Fallon as well as the numerous opportunities they will create with their presence in Denver,” said Thornton. “As with our recently opened offices in Austin and Tampa, HFF’s goal is to strategically build-out the full platform of services and product specializations in our new Denver office by hiring and retaining associates who have the highest ethical standards and the best reputation in the industry.”
Holliday Fenoglio Fowler, LP (“HFF”) and HFF Securities LP (“HFFS”) are owned by HFF, Inc. (NYSE: HF – News). HFF operates out of 20 offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF together with its affiliate HFFS offer clients a fully integrated national capital markets platform including debt placement, investment sales, advisory services, structured finance, private equity, loan sales, and commercial loan servicing. http://www.hfflp.com/

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Schulte Roth & Zabel LLP Announces Election of New Partners and Promotion of Associates to Special Counsel

NEW YORK–(BUSINESS WIRE)– Schulte Roth & Zabel LLP is pleased to announce the election of Eric A. Bensky, Jennifer Dunn, Christopher S. Harrison and David J. Karp as partners. The firm also announces the promotion of James T. Bentley, Michael G. Cutini, Farzad F. Damania, William I. Friedman, Frank J. LaSalle, James Nicoll and Leonora M. Shalet to special counsel.
Eric Bensky is resident in the firm’s Washington, D.C. office. The other new partners and special counsel are located in the firm’s New York office. David Karp is resident in both the New York and London offices.
“We are very proud of these individuals who have distinguished themselves through their contributions to our clients and the firm,” said Alan Waldenberg, a member of the firm’s executive committee. “The depth of their knowledge and experience greatly enhances the value of our legal services and reflects the firm’s commitment to providing the highest level of guidance and client service.”
PARTNERS
Eric A. Bensky, a partner in the litigation group, focuses his practice on securities litigation, including civil, disciplinary and criminal proceedings and investigations before federal and state courts, the Securities and Exchange Commission, the Financial Industry Regulatory Authority (FINRA), various stock exchanges, and arbitration panels of FINRA and other self-regulatory organizations. He received his B.A., with high honors and high distinction, from the University of Michigan and his J.D., with honors, from the University of Chicago Law School.
Jennifer Dunn, a partner in the investment management group, advises hedge funds, private equity funds, hybrid funds, funds of funds and investment advisers in connection with their structuring, formation and ongoing operational needs, general securities laws matters, and regulatory and compliance issues. After obtaining a B.A., cum laude, from the University of Pennsylvania, Jennifer received her J.D. from Columbia Law School.
Christopher S. Harrison, a partner in the M&A and private equity practices of the business transactions group, concentrates his practice on hedge fund mergers and acquisitions, private equity transactions, and domestic and cross-border mergers and acquisitions. Christopher also serves as an adjunct professor at New York University School of Law. He has a B.A. from Friedrich-Schiller-Universität and a J.D., cum laude, from New York University School of Law.
David J. Karp, a partner in the business reorganization group, focuses his practice on corporate restructuring, special situations and distressed investments, distressed mergers and acquisitions, and the bankruptcy aspects of structured finance. In addition, David leads the firm’s distressed debt & claims trading practice, which provides advice in connection with U.S., European and emerging market debt and claims trading matters. He received his B.S. from Cornell University and his J.D. from Fordham University School of Law.
SPECIAL COUNSEL
James T. Bentley, a special counsel in the business reorganization group, practices in the areas of distressed mergers and acquisitions, debtor-in-possession financing, corporate restructuring, and out-of-court workouts. James received his B.A. from Boston College and his J.D., cum laude, from Brooklyn Law School. After earning his law degree, James clerked for Chief Judge Carla E. Craig of the Eastern District of New York Bankruptcy Court. Prior to joining SRZ, he was an assistant vice president in Citigroup’s Global Corporate Banking Group.
Michael G. Cutini, a special counsel in the litigation group, focuses his practice in the areas of complex commercial and business, securities and shareholder, and bankruptcy litigation on behalf of privately and publicly held companies and financial services industry clients, including hedge funds, private equity funds, and prime and clearing brokers, as well as advising clients on compliance with antitrust laws, particularly in the context of mergers and acquisitions. He received his B.A., summa cum laude, from the State University of New York Fredonia and went on to obtain his J.D., cum laude, from Syracuse University College of Law.
Farzad F. Damania, a special counsel in the business transactions group, focuses his practice on capital markets and securities law, mergers and acquisitions and general corporate law. Farzad received his B.A. from St. Xavier’s College and his LL.B. from Government Law College, both in Bombay, India, and he received his LL.M. from Chicago-Kent College of Law, Illinois Institute of Technology.
William I. Friedman, a special counsel in the litigation group, concentrates his practice on AML, OFAC and FCPA issues and other regulatory areas. Prior to joining SRZ, William was with the New York Stock Exchange, where he served as special counsel in its Division of Enforcement. After graduating with honors from Brandeis University, he earned his M.B.A. from Baruch College, CUNY, and received his J.D. from Brooklyn Law School. After earning his law degree, William served as a law clerk to the Hon. Bernard J. Fried of New York County, Supreme Court, Criminal Branch.
Frank J. LaSalle, a special counsel in the litigation group, practices in the areas of complex commercial, securities, corporate governance, accountants liability, intellectual property, real property, class action defense, bankruptcy and creditors rights litigation, and securities regulatory investigations and examinations. Frank earned his B.A. and M.A. from Miami University and his J.D. from University of Akron School of Law.
James Nicoll, a special counsel in the business transactions group, focuses his practice on corporate finance transactions, counseling corporate clients on compliance with the federal securities laws and on general corporate matters, venture capital and mergers and acquisitions. He holds a B.S. from Cornell University and a J.D. from the University of Pennsylvania Law School.
Leonora M. Shalet, a special counsel in the investment management group, focuses her practice on advising investment funds (including hedge funds, private equity funds, hybrid funds and funds of funds) and investment advisers in connection with their structuring, formation and ongoing operational needs, general securities laws matters, and regulatory and compliance issues. Leonora earned an LL.B. in Law with French Law from Birmingham University, Birmingham, England as well as a French Law Diploma from Limoges Law School, France (ERASMUS). Leonora is also a graduate of the Legal Practice Course from Nottingham Law School, Nottingham Trent, England.
About Schulte Roth & Zabel LLP
Schulte Roth & Zabel LLP (www.srz.com) is a full-service law firm with offices in New York, Washington, D.C. and London. As one of the leading law firms serving the financial services industry, the firm regularly advises clients on corporate and transactional matters, as well as providing counsel on securities regulatory compliance, enforcement and investigative issues. The firm’s practices include investment management; M&A securities & capital markets; litigation; business reorganization; distressed debt & claims trading; employment & employee benefits; environmental; finance; individual client services; intellectual property, sourcing & technology; real estate; regulatory & compliance; structured products & derivatives; and tax

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Intervale Capital Raises $63M for Private Equity Fund – cbl

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Posted January 3, 2012

Charles Cherington

By Bill Murphy
CAMBRIDGE, Mass. – Intervale Capital has raised $63 million, or about 18 percent of a $350 million private equity fund, from seven investors, according to an SEC filing.
Principals named in the filing by the Cambridge-based fund that focuses on investments in energy firms are:
· Managing partner Charles Cherington; and
· Partner Erich Horsley.
The company said it would pay an affiliate up to $2 million from the proceeds towards annual management fee. It also expects to pay a sales commission of up to $157,500.
Currently, Intervale Capital manages a $280 million private equity fund that invests in oilfield service and manufacturing companies. It has investments in 10 companies.
Reg D filing: http://tinyurl.com/6vvzyje
Also, at citybizlist see:
Intervale Capital Signs Office Lease in Cambridge, MA
Intervale Capital Promotes Erich Horsley to Partner
Bios from Intervale Capital site:
Charles Cherington
Managing Partner
Charles co-founded Intervale Capital to build on the success of Cherington Capital, a private equity firm focused on investments in middle market energy companies. Prior to founding Cherington Capital, Charles co-founded a smaller fund which also focused on middle market buyouts. Charles has over fifteen years of private equity experience.
Before launching his first fund, Charles spent several years as a vice president at the Vietnam Fund, a British private equity fund. Charles also worked for CS First Boston in New York and Vietnam.
Charles earned an M.B.A., with honors, from the University of Chicago and a B.A. in History from Wesleyan University.
Erich Horsley
Partner
Erich started his private equity career in 1998, and has focused exclusively on buyouts of middle-market companies. Erich served as a Principal at Watermill Ventures, a private equity group based in Waltham, MA. He also served as a Vice President at a Boston-based private equity firm with $1.4 billion under management. Erich has spent most of his private equity career executing transactions and overseeing growth in industrial and energy-related businesses.
Erich was a Financial Analyst in the Corporate Finance Department of Morgan Stanley in New York and in Frankfurt, Germany from 1994 to 1996.
Erich received his B.A. in Psychology and English, with honors, from Harvard College and his M.B.A. from Harvard Business School.

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Golub Capital Provides One-Loan Financing to Support Freeman Spogli & Co.’s Acquisition of First Watch Restaurants, Inc.

NEW YORK , Dec. 27, 2011 /PRNewswire/ — Golub Capital announced today that it provided a GOLD financing debt facility to First Watch Restaurants, Inc. (“First Watch” or the “Company”) to support the acquisition of First Watch by Freeman Spogli & Co. (” Freeman Spogli “). GOLD financings are Golub Capital’s One-Loan Debt facilities.
Headquartered in Bradenton, Florida , First Watch is a leading operator of full service breakfast and lunch restaurants, located primarily in the Southeast, Midwest and Mid-Atlantic regions. With 82 company-owned restaurants spanning nine states and 10 franchised locations in five states, First Watch is recognized for providing healthy and hearty breakfast and lunch offerings, served in a welcoming and friendly environment. First Watch specializes in the creation of traditional favorites such as pancakes, omelets, salads and sandwiches, as well as a variety of signature items, with all menu items freshly prepared to order. First Watch has received more than 200 “Best Of” accolades in markets across the country.
“We are excited to support Freeman Spogli ‘s investment in First Watch,” said Golub Capital Principal Troy Oder . “The Company’s management team has an excellent track record of growing the First Watch brand, and Freeman Spogli is the ideal sponsor to position the Company for its next phase of growth due to their extensive knowledge of the consumer sector.”
“We chose to partner with Golub Capital due to their expertise in the restaurant industry and their understanding of the unique financing needs of investors in the space,” noted John Roth , President, of Freeman Spogli & Co. “They were able to deliver a flexible financing solution that allowed us to complete the transaction within an extremely tight timeframe.”
About Golub CapitalWith over $5 billion in capital under management, Golub Capital is a leading provider of financing solutions for the middle market, including one-loan financings (through the firm’s proprietary GOLD facility), senior, second lien, and subordinated debt, preferred stock and co-investment equity. The firm also underwrites and syndicates senior credit facilities up to $200 million . Golub Capital’s hold sizes range up to $100 million per transaction.
Golub Capital is currently ranked as the #1 Middle Market Bookrunner for YTD 3Q 2011 by Thomson Reuters Loan Pricing Corporation. Golub Capital was named “Middle Market Lender of the Year” by Buyouts Magazine in 2009 and 2010. The firm was also honored as “Debt Financing Agent of the Year” by M&A Advisor in 2010. Golub Capital is a national firm with principal offices in Chicago and New York . For more information, please visit the firm’s website at golubcapital.com.
About Freeman Spogli & Co.Freeman Spogli & Co. is a private equity firm dedicated exclusively to investing in and partnering with management in consumer-related and distribution companies in the United States . Since its founding in 1983, Freeman Spogli has invested $3.0 billion of equity in 47 portfolio companies with aggregate transaction value of over $17 billion , and is currently making investments from FS Equity Partners VI, L.P. Freeman Spogli has offices in Los Angeles and New York . For additional information, visit freemanspogli.com.


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Ziegler Closes $28 Million MRC Crestview Financing

CHICAGO, IL–(Marketwire -12/14/11)- Ziegler, a specialty investment bank, is pleased to announce the successful closing of a $28,295,000 non-rated bond issue for MRC Crestview. MRC Crestview, d/b/a Crestview Retirement Community, is located on 14 acres in Bryan, Texas. Ziegler served as sole manager for the Series 2011 Bonds.
MRC Crestview is a Texas non-profit corporation originally formed in 1962. In 1970, Crestview became part of Methodist Retirement Communities (MRC), a Texas non-profit system that provides management and related support services to MRC Crestview and other affiliated entities. MRC ranks #88 on the LeadingAge Ziegler 100, a list of the largest not-for-profit senior living providers in the nation.
Due to the aging of the existing community, MRC Crestview engaged Greystone Communities to assist in providing development services towards implementing a repositioning of the campus in a two-phased approach. The improvements which constituted Phase I, which was funded with a Ziegler underwritten Series 2010 bond issue, consisted of the construction of an assisted living center with 48 assisted living suites and 18 memory support suites, as well as a health center consisting of 48 skilled nursing beds and related common areas undertaken on seven acres of undeveloped land.
Proceeds of the Series 2011 Bonds will be used to fund Phase II of the redevelopment plan consisting of demolishing the existing community and constructing 92-entrance fee based independent living units and additional common areas for the residents. The new independent living units are 100% pre-sold with a waiting list of more than 40 persons at the time of pricing of the Series 2011 Bonds. Additionally, bond proceeds will be used to fund debt service reserve funds for the Series 2011 Bonds, fund capitalized interest for 22 months, and pay a portion of the costs of issuance.
The Series 2011 Bonds consist of $11,500,000 in temporary debt to be redeemed from initial entrance fees after establishing reserves and $16,795,000 in permanent debt that will amortize with the Series 2010 Bonds to provide aggregate level annual debt service. As with the Series 2010 Bonds, there will be a funded liquidity support agreement in the amount of $1,000,000.
Ziegler is one of the nation’s leading underwriters of financing for non-profit senior living providers Ziegler offering investment banking, financial risk management, merger and acquisition services, investment management, seed capital, FHA/HUD, capital and strategic planning as well as senior living research, education, and communication. Rich Scanlon, Managing Director in Ziegler’s Senior Living practice, commented, “Crestview has had a 40 year reputation for providing quality senior services in the Bryan/College Station market. The influence of a new management team at MRC is clearly seen on this complex repositioning which will improve the quality and breadth of services that MRC will be able to provide in that market area.”
For further information on the structure and use of this issue, please see the Official Statement located on the Electronic Municipal Market Access system’s Document Archive.
For more information about Ziegler, please visit us at www.Ziegler.com.
About Ziegler:
The Ziegler Companies, Inc. (Pinksheets: ZGCO.PK – News) together with its affiliates (Ziegler) is a specialty investment bank with unique expertise in complex credit structures and advisory services. Nationally, Ziegler is ranked as one of the leading investment banking firms in its specialty sectors of healthcare, senior living, religion and education finance, as well as corporate finance and FHA/HUD. Headquartered in Chicago, IL with regional and branch offices throughout the U.S., Ziegler creates tailored financial solutions including bond financing, advisory, private placement, seed capital, M&A, risk and asset management. Ziegler serves institutional and individual investors through its wealth management and capital markets distribution channels.
Certain comments in this news release represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. This client’s experience may not be representative of the experience of other clients, nor is it indicative of future performance or success. The forward-looking statements are subject to a number of risks and uncertainties, in particular, the overall financial health of the securities industry, the strength of the healthcare sector of the U.S. economy and the municipal securities marketplace, the ability of the Company to underwrite and distribute securities, the market value of mutual fund portfolios and separate account portfolios advised by the Company, the volume of sales by its retail brokers, the outcome of pending litigation, and the ability to attract and retain qualified employees.
This communication does not constitute an offer to buy these securities. The offering is made only by the Official Statement and through an appropriately registered representative. The Series 2011 Bonds may not be appropriate for all investors. Market value and/or accrued interest will fluctuate during the period held, and, if sold prior to maturity, the yield received may be more or less than the yield calculated at the time of purchase. Discounted yields herein are gross yields to maturity. Discounted bonds may be subject to capital gains tax, rates of which will vary, so investors should consult their own tax advisor with regard to their personal tax situation. Interest on municipal bonds may be exempt from federal income tax but may be subject to tax for residents of certain states. For bonds designated AMT, taxes may exist for certain investors. Ziegler will sell these bonds on a principal basis.
The corporation or its officers, directors, stockholders, or members of their families may at times have a position in the securities mentioned herein and may make purchases or sales of these securities. Not all call or put information is identified in the description above. Please be sure to discuss any special features with your Financial Advisor before deciding whether to invest in these securities.

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