Deerfield swaps remaining $25 million trust preferreds for new notes

By Marisa Wong

Madison, Wis., Oct. 21 - Deerfield Capital Corp. exchanged the remaining $25 million of its original $120 million trust preferred securities for $25 million of new junior subordinated notes due 2035 on Wednesday, according to a news release.

The terms of the new notes are similar to those of the junior subordinated notes issued by the company on March 4, 2010 in exchange for the other $95 million of trust preferreds.

The previously issued notes contained an interest rate accommodation, while the new notes retain the annual interest rate of the preferreds of Libor plus 350 basis points.

The covenants governing the new notes are substantially less restrictive than those governing the trust preferreds.

"Exchanging the last of our trust preferred securities for new junior subordinated notes with less restrictive covenants greatly enhances our financial flexibility going forward," said Deerfield chief executive officer Jonathan Trutter in the release.

"This exchange completes a series of transactions during 2010 designed to strengthen our balance sheet."

Based in Rosemont, Ill., Deerfield is a fixed-income investment management services company.

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