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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
June 1, 1998
(Date of Report - Date of earliest event reported)
NATIONAL AUTO CREDIT, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-11601 34-1816760
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File No.) Identification No.)
30000 Aurora Road, Solon, Ohio 44139
(Address of principal executive offices and zip code)
(440) 349-1000
(Registrant's telephone number, including area code)
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Item 5. Other Events
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On June 1, 1998, the Company issued the following press release:
National Auto Credit, Inc. announced today that the Company has engaged the
services of the corporate turnaround specialist firm Jay Alix & Associates to
advise the Company in refining the Company's business strategy and developing
new business strategies in light of the recent developments in the sub-prime
auto finance industry. Jay Alix & Associates will also assist the Company in
coordinating communication with the Company's lenders, shareholders and other
interested parties. The Company is currently in negotiations with its lender
group regarding the extension of the maturity date of its outstanding
indebtedness.
Mr. Thomas W. Cross, a Principal with Jay Alix & Associates, has been appointed
Interim Chief Executive Officer of the Company. Mr. Cross, with over 30 years of
business experience and a background in the finance industry, specializes in
leading financial and operational restructuring programs. Over the past five
years, he has played a key role in corporate turnaround efforts at major U.S.
and international companies.
National Auto Credit, Inc. is a specialized financial services company providing
funding, receivables management and collection services to automobile dealers
who sell and finance the purchase of vehicles to retail consumers with limited
access to consumer credit.
On June 4, 1998, the Company issued the following press release:
National Auto Credit, Inc. announced that it has reached an agreement in
principle with its lenders to further extend the maturity date of the amounts
outstanding under its credit agreements, originally due on January 21, 1998,
until September 30, 1998.
Pursuant to this agreement in principle with its lender group, the Company has
agreed, upon execution of a definitive extension agreement, to make a principal
payment of $9 million, and commencing this week, weekly payments of $1 million
principal and interest, at the prime rate plus two percent, through September
30, 1998.
The Company stated that since January 21, 1998, it has repaid approximately
$18.2 million or 22 percent of its then outstanding principal obligations, which
presently total approximately $65.6 million. The Company maintains a positive
cash position and continues to operate on internally generated funds while it
pursues alternative sources of capital.
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Interim CEO Tom Cross noted that he is "particularly pleased with the level of
cooperation and progress made with the Company's lender group and believes that
the agreement further positions the Company to accomplish its turnaround
objective."
National Auto Credit, Inc. is a specialized financial services company providing
funding, receivables management and collection services to automobile dealers
who sell and finance the purchase of vehicles to retail consumers with limited
access to consumer credit.
The statements contained in this release that are not purely historical are
forward looking statements within the meaning of the Securities and Exchange Act
of 1934. Among the factors that could cause actual results to differ materially
from the forward looking statements are the potential for greater than
anticipated non-performing contracts, the potential for lower than anticipated
recoverability of amounts advanced to the Company's member dealers, availability
of funds under the Company's financing arrangements, and other factors as
discussed in the Company's reports filed with the Securities and Exchange
Commission.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NATIONAL AUTO CREDIT, INC.
(Registrant)
Date: June 10, 1998 BY: /s/ Davida S. Howard
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Davida S. Howard
Vice President-Finance and
Controller
