SPARTANBURG, S.C., Jan. 7, 2010 (GLOBE NEWSWIRE) -- First National Bancshares, Inc., (Nasdaq:FNSC) announced today it has signed a new, revised loan-modification agreement with Nexity Bank for a discounted sum of $3.5 million. Effective immediately, the modified agreement eliminates covenant violations that arose in April 2009 and First National is now in full compliance with all provisions of the loan.
As of December 30, 2009, the Company had an outstanding principal balance of $9,640,917 on the loan. In full satisfaction of the loan, First National has agreed to pay to Nexity Bank an amount equal to the discounted sum of $3,500,000, plus accumulated 2010 interest. On December 31, 2009, pursuant to this agreement, First National Bancshares paid the third quarter 2009 interest payment of approximately $150,000 to Nexity and Nexity agreed to forgive interest for the fourth quarter, ending December 31, 2009, in the same amount. The agreement now awaits approval of banking regulators.
"This proposed agreement represents a significant, strategic step toward the rehabilitation of our Company and First National Bank of the South. This agreement is only one of the many advances that we have diligently worked toward during the last several months," J. Barry Mason, President and CEO of First National Bancshares and its subsidiary, First National Bank of the South, said. "We believe this agreement with Nexity, combined with operational efficiencies and portfolio actions, will contribute to the soundness of the Company and to shareholder value."
First National Bancshares is the Spartanburg, SC,-based holding company for the 13-branch First National Bank of the South. Nexity is a Birmingham, AL, bank that had provided First National Bancshares with a $15 million credit line in 2007.
About First National Bancshares
First National Bancshares, Inc., (Nasdaq:FNSC) is a $785.8-million asset bank holding company, based in Spartanburg, South Carolina. It provides a wide range of financial services to consumer and commercial customers through its wholly owned banking subsidiary, First National Bank of the South, which has 13 full-service branches in six South Carolina counties. First National Bancshares was incorporated in 1999 to conduct general banking business through its wholly owned bank subsidiary, First National Bank of the South. Additional information about First National is available online at www.fnbwecandothat.com. For additional information about the content of this news release, please check www.sec.gov for the Company's 8-K filing.
Certain statements in this news release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to future plans and expectations, and are thus prospective. Such forward-looking statements include but are not limited to (1) statements regarding future approval of the loan modification agreement by bank regulators, regarding which First National makes no assurances, (2) statements with respect to First National's plans, objectives, expectations and intentions and other statements that are not historical facts, and (3) other statements identified by words such as "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," and "projects," as well as similar expressions. Such statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate. Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this forward-looking information should not be construed as a representation by our company or any person that the future events, plans, or expectations contemplated by our company will be achieved. All subsequent written and oral forward-looking statements concerning the company or any person acting on its behalf is expressly qualified in its entirety by the cautionary statements above. First National does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.