DCAP Group restructures preferreds, debt; announces partial redemption

By Devika Patel

Knoxville, Tenn., May 12 - DCAP Group, Inc. said it has restructured its preferred stock and restructured and partially redeemed its outstanding debt.

The company issued new series E preferred shares, which are mandatorily redeemable on July 31, 2011, in exchange for its outstanding series D preferred shares, which was mandatorily redeemable on July 31, 2009.

In addition, $519,000 of DCAP's notes, which were payable on July 10, 2009, have been exchanged for series E preferreds.

The company also prepaid approximately $687,000 in notes.

After the company sold its New York stores in April and its franchise business earlier this month, management felt the need to restructure its capital obligations beyond July.

Cash from the sales was used to pay down the notes and interest.

There is now less than $300,000 of debt due to mature in July. The company hopes that the remaining debt will be repaid with the proceeds from a planned sale of its Pennsylvania stores or through an equity or debt financing.

Based in Hewlett, N.Y., DCAP Group provides automobile, motorcycle and homeowners insurance.

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