Assured Guaranty Corp. (AGC) announced today that it has reached an agreement on a forbearance and restructuring plan with Xenia Rural Water District, Iowa. The plan provides for the full repayment of all claims made under the bond insurance policy for Xenia's Water Revenue Bonds, Series 2006, while providing Xenia additional time to repay such amounts. At the same time, USDA Rural Development has agreed to restructure its outstanding loans with Xenia. These steps will help Xenia meet its future obligations and return to financial stability, as well as meet the needs of the customers of its water system. In addition, under the forbearance agreement the pending litigation between AGC and Xenia will be dismissed.
Robert Tucker, Managing Director, Investor Relations and Corporate Communications commented: "We are pleased that AGC, Xenia and USDA Rural Development have been able to agree on a restructuring plan. This restructuring is a good example of the way AGC is able to work with a distressed municipal debtor to achieve a consensual and long-term financial solution that addresses the needs of all parties. The holders of the Xenia bonds continued to receive scheduled payments under the AGC municipal bond insurance policy throughout this process and now have the benefit of both a stronger underlying credit and our insurance. We thank Xenia and USDA Rural Development for their assistance and efforts in reaching this resolution.”
The Xenia Policy was a “Covered Policy” under the Quota Share Reinsurance Agreement dated January 21, 2009 between AGC and CIFG Assurance North America, Inc. and was subsequently novated to AGC.
AGC is a Maryland-domiciled insurance company regulated by the Maryland Insurance Administration and licensed to conduct financial guaranty insurance business in all 50 states of the United States, the District of Columbia and Puerto Rico. AGC commenced operations in 1988. AGC is a wholly owned, indirect subsidiary of Assured Guaranty Ltd. (“AGL”), a Bermuda-based holding company whose shares are publicly traded and are listed on the New York Stock Exchange under the symbol “AGO.” AGL, through its operating subsidiaries, provides credit enhancement products to the U.S. and international public finance, infrastructure finance and structured finance markets. Neither AGL nor any of its shareholders is obligated to pay any debts of AGC or any claims under any insurance policy issued by AGC.
Cautionary Statement Regarding Forward-Looking Statements
Any forward-looking statements made in this press release reflect the Company's current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are made as of April 3, 2013, and Assured Guaranty undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Robert Tucker, 212-339-0861
Managing Director, Investor Relations and Corporate Communications
Ashweeta Durani, 212-408-6042
Vice President, Corporate Communications
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