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Desert Capital REIT's junior subordinated notes accelerated
By Caroline Salls
Pittsburgh, July 31 - Desert Capital REIT, Inc. has received a notice of default and acceleration on its unsecured junior subordinated notes because the tangible net worth of the company was less than $100 million, according to an 8-K filed with the Securities and Exchange Commission.
The default notice was received from agent Taberna Capital Management, LLC for trust preferred securities holders Taberna Preferred Funding IV, Ltd. and Taberna Preferred Funding VIII, Ltd.
The company said there are $31 million in principal amount of the notes outstanding to Desert Capital TRS Statutory Trust I, which secure trust preferred securities that were issued to the trust preferred securities holders.
According to the filing, Desert Capital REIT received a notice of tangible net worth default on April 3 that it could not cure.
The company said it has been in restructuring negotiations with the trust preferred securities holders.
Desert Capital is a Henderson, Nev.-based real estate investment trust.
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