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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
(AMENDMENT NO. 1)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) OCTOBER 13, 1998
BNC MORTGAGE, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 33-0661303
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1063 MCGAW AVENUE 92614-5532
IRVINE, CALIFORNIA (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
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ISSUER'S TELEPHONE NUMBER: (949) 260-6000
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(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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This current report amends the Current Report on Form 8-K of BNC Mortgage, Inc.
(the "Corporation"), dated October 22, 1998. This current report reflects an
amendment to the Corporation's Rights Agreement approved by the Corporation's
board of directors and is set forth as Exhibit 4.2(a) hereto.
The following information amends Items 5 and 7 of the Current Report on Form 8-K
and sets forth, in its entirety, the information as amended.
ITEM 5. OTHER EVENTS
On October 13, 1998, the Board of Directors of BNC Mortgage, Inc. (the
"Corporation") declared a dividend distribution of one preferred share purchase
right (a "Right") for each outstanding share of Common Stock, $.001 par value
per share (the "Common Stock"), of the Corporation. The dividend is payable to
stockholders of record on October 26, 1998 (the "Record Date"), and with respect
to Common Stock issued thereafter until the Distribution Date (as defined below)
and, in certain circumstances, with respect to Common Stock issued after the
Distribution Date. Except as set forth below, each Right, when it becomes
exercisable, entitles the registered holder to purchase from the Corporation one
one-hundredth of a share of Series A Junior Participating Preferred Stock,
$0.001 par value per share (the "Preferred Shares"), of the Corporation at a
price of $25.00 per one one-hundredth of a Preferred Share (the "Purchase
Price"), subject to adjustment. The description and terms of the Rights are set
forth in a Rights Agreement (the "Rights Agreement") between the Corporation and
U.S. Stock Transfer Corporation, as Rights Agent (the "Rights Agent") dated as
of October 13, 1998.
Initially, the Rights will be attached to all certificates representing
Common Stock then outstanding, and no separate Right Certificates will be
distributed. The Rights will separate from the Common Stock upon the earliest to
occur of (i) ten (10) days after an Acquiring Person (as defined in the Rights
Agreement) or group of affiliated or associated persons has acquired beneficial
ownership of 20% or more of the Corporation's outstanding Common Stock (except
pursuant to a Permitted Offer, as hereinafter defined); or (ii) ten (10)
Business Days (as defined in the Rights Agreement) (or such later date as the
Board may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer the consummation of which
would result in a person or group becoming an Acquiring Person (as hereinafter
defined) (the earliest of such dates being called the "Distribution Date"). A
person or group whose acquisition of Common Stock causes a Distribution Date
pursuant to clause (i) above is an "Acquiring Person." The date that a person or
group becomes an Acquiring Person is the "Shares Acquisition Date."
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred solely with the Common Stock. Until the Distribution
Date (or earlier redemption or expiration of the Rights), new Common Stock
certificates issued after the Record Date upon
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transfer or new issuances of Common Stock will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer of any
certificates for Common Stock outstanding as of the Record Date, even if such
notation or a copy of the Summary of Rights is not attached thereto, will also
constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Stock as of the close of business on the
Distribution Date (and to each initial record holder of certain Common Stock
issued after the Distribution Date), and such separate Right Certificates alone
will evidence the Rights.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on October 26, 2008, unless earlier redeemed by
the Corporation as described below.
If any person becomes an Acquiring Person (except pursuant to a tender
or exchange offer which is for all outstanding Common Stock at a price and on
terms which a majority of members of the Board of Directors (who are not also
officers of the Corporation or an Acquiring Person or affiliate or associate
thereof) determines to be adequate and in the best interests of the Corporation
and its shareholders, other than such Acquiring Person, its affiliates and
associates (a "Permitted Offer")), each holder of a Right will thereafter have
the right (the "Flip-In Right") to receive upon exercise the number of shares of
Common Stock (or, in certain circumstances, one one-hundredths of a share of
Preferred Shares or other securities of the Corporation) having a market value
(immediately before such triggering event) equal to two times the exercise price
of the Right. At such time, all Rights that are beneficially owned by the
Acquiring Person or any affiliate, associate or transferee thereof will be null
and void.
If at any time following the Shares Acquisition Date, (i) the
Corporation is acquired in a merger or other business combination transaction in
which the holders of all of the outstanding Common Shares immediately before the
consummation of the transaction are not the holders of all of the surviving
corporation's voting power, or (ii) more than 50% of the Corporation's assets or
earning power are sold or transferred, in either case with or to an Acquiring
Person or any affiliate or associate or any other person in which such Acquiring
Person, affiliate or associate has an interest or any person acting on behalf of
or in concert with such Acquiring Person, affiliate or associate, or, if in such
transaction all holders of Common Stock are not treated alike, then each holder
of a Right (except Rights which previously have been voided as set forth above)
shall thereafter have the right (the "Flip-Over Right") to receive, upon
exercise, common shares of the acquiring company having a value equal to two
times the exercise price of the Right. The holder of a Right will continue to
have the Flip-Over Right only to the extent that the Flip-In Right has not
previously been exercised.
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The Purchase Price payable and the number of Preferred Shares, shares of
Common Stock or other securities issuable upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares at a
price (or conversion price as the case may be), less than the then current
market price of the Preferred Shares or (iii) upon the distribution to holders
of the Preferred Shares of evidences of indebtedness or assets (excluding
regular quarterly cash dividends) or of subscription rights or warrants (other
than those referred to above).
The number of outstanding Rights and the number of one one-hundredth of
a Preferred Share issuable upon exercise of each Right are also subject to
adjustment in the event of a stock split of the Common Stock or a stock dividend
on the Common Stock payable in Common Stock or subdivisions, consolidations or
combinations of the Common Stock occurring, in any such case, before the
Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will not be
redeemable. Each Preferred Share will be entitled to a minimum preferential
quarterly dividend payment of $1.00 per share but, if greater, will be entitled
to an aggregate dividend per share of 100 times the dividend declared per share
of Common Stock. In the event of liquidation, the holders of the Preferred
Shares will be entitled to a minimum preferential liquidation payment of $100
per share, plus accrued and unpaid dividends; thereafter, and after the holders
of the Common Stock receive a liquidation payment of $1.00 per share (as
adjusted), the holders of the Preferred Shares and the holders of the Common
Stock will share the remaining assets in the ratio of 100 to 1 (as adjusted) for
each Preferred Share and share of Common Stock so held, respectively. Finally,
in the event of any merger, consolidation or other transaction in which Common
Stock is exchanged, each Preferred Share will be entitled to receive 100 times
the amount received per share of Common Stock. The rights are protected by
customary antidilution provisions. In the event that the amount of accrued and
unpaid dividends on the Preferred Shares is equivalent to six full quarterly
dividends or more (whether or not consecutive), the holders of the Preferred
Shares shall have the right, voting as a class, to elect two directors until all
cumulative dividends on the Preferred Shares have been paid through the last
quarterly dividend payment date or until non-cumulative dividends have been paid
regularly for at least one year.
With certain exceptions, no adjustment to the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional Preferred Shares will be issued (other than
fractions which are one one-hundredth or integral multiples of one one-hundredth
of a Preferred Share, which may, at the election of the Corporation, be
evidenced by depository receipts) and in lieu thereof, a payment in cash will be
made based on the market price of the Preferred Shares on the last Trading Day
(as defined in the Rights Agreement) before the date of exercise.
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At any time before the earlier to occur of (i) a person becoming an
Acquiring Person, (ii) the expiration of the Rights, or (iii) in certain
circumstances, after the Shares Acquisition Date, the Corporation may redeem all
but not less than all of the Rights at a price of $.0001 per Right (the
"Redemption Price") which redemption shall be effective upon the action of the
Board of Directors.
All of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Corporation before the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be amended by the
Board in order to cure any ambiguity, defect or inconsistency, to make changes
which do not adversely affect the interests of holders of Rights (excluding the
interests of any Acquiring Person), or, subject to certain limitations, to
shorten or lengthen any time period under the Rights Agreement.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A, dated
October 22, 1998. A copy of the Rights Agreement is available free of charge
from the Corporation. This summary description of the Rights does not purport to
be complete and is qualified in its entirety by reference to the Rights
Agreement, which is hereby incorporated herein by reference.
Item 7. Financial Statements and Exhibits
(c) Exhibits
4.2 Rights Agreement, dated as of October 13, 1998, between BNC
Mortgage, Inc. and U.S. Stock Transfer Corporation (incorporated
by reference to the Company's Form 8-A filed with the Securities
and Exchange Commission on October 22, 1998).
4.2(a) Amendment No. 1 to Rights Agreement, dated December 16, 1998
between BNC Mortgage, Inc. and U.S. Stock Transfer Corporation
(incorporated by reference to Amendment No. 1 to the Company's
Form 8-A/A filed with the Securities and Exchange Commission on
January 6, 1999).
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SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this Registration Statement to be
signed on its behalf by the undersigned hereunto duly authorized.
Date: December 29, 1998
BNC MORTGAGE, INC.
BY: /s/ KELLY MONAHAN
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Kelly Monahan
President
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