SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported): September 27, 1998
SOUTHERN PACIFIC FUNDING CORPORATION
(Exact name of registrant as specified in its charter)
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California 1-11785 33-0636924
(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
4949 Meadows Road, Suite 600
Lake Oswego, OR 97035
(Address of principal executive offices) (Zip code)
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(503) 303-5400
(Registrant's telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year,
if changed since last report)
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Item 5. Other Events
On September 28, 1998, the registrant announced the appointment of E.
James Hedemark as chief executive officer and Timothy A. Breedlove as chief
financial officer of the registrant following the resignation of the prior
occupants of those positions, as well as the appointment of Kevin D. Padrick to
the newly-created position of executive vice president, capital financing. The
press release is attached as Exhibit 99.1.
On September 29, 1998, the registrant announced the filing of a lawsuit
against one of its lenders and discussions with its warehouse facility lenders
with respect to recent notices of default regarding certain loan covenants. The
press release is attached as Exhibit 99.2.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits. The following documents are filed as exhibits to this
report:
99.1 Registrant's press release dated September 28, 1998,
relating to management changes.
99.2 Registrant's press release dated September 29, 1998
relating to the filing of a lawsuit and negotiations
with lenders.
SIGNATURE
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 thereunto duly authorized.
Dated: September 30, 1998 SOUTHERN PACIFIC FUNDING CORPORATION
By: /s/ E. James Hedemark
Name: E. James Hedemark
Title: Chief Executive Officer
FOR MORE INFORMATION CONTACT:
David Kiser, CPA
Director of Corporate Communications
Southern Pacific Funding Corporation
(503) 303-2280
SOUTHERN PACIFIC FUNDING CORPORATION APPOINTS E. JAMES
HEDEMARK AS CHIEF EXECUTIVE OFFICER
LAKE OSWEGO, OR--September 28, 1998--Southern Pacific Funding Corporation
(NYSE:SFC) today announced that its board of directors has appointed E. James
Hedemark as Chief Executive Officer. Timothy A. Breedlove has been appointed as
Executive Vice President, Chief Financial Officer and Kevin D. Padrick has
joined the Company as Executive Vice President, Capital Financing. Both Mr.
Breedlove and Mr. Padrick will report to Mr. Hedemark.
H. Wayne Snavely, Chairman of the Board, stated that the changes were necessary,
in the opinion of the board, as the Company attempts to restructure its capital
base, funding sources, and origination businesses. The contemplated changes
required executives with the skills and experience that are offered by Messrs.
Hedemark, Breedlove and Padrick.
Robert W. Howard and Peter F. Makowiecki have resigned from their positions as
Chief Executive Officer and Executive Vice President, Chief Financial Officer,
respectively. Both Mr. Howard and Mr. Makowiecki will continue as consultants to
assist the Company in exploration of strategic alternatives.
Mr. Hedemark has been a member of the board of directors of Southern Pacific
Funding Corporation since June 1998, and has been a consultant to the Company
since his appointment to the board. He has been a private consultant to Hedemark
& Company since 1994. Previously, he was President and Chief Executive Officer
of Napa Valley Bank. Mr. Hedemark also held various positions during a 21-year
career with Bank of America N.T. & S.A., including President and Chief Executive
Officer of Bank of America Texas, N.A.
Mr. Breedlove has been SVP, Controller of Southern Pacific Funding since
December 1997. Mr. Breedlove brings more than 20 years of financial and mortgage
industry experience to the Company. Prior to joining Southern Pacific Funding,
Mr. Breedlove was SVP, Chief Accounting Officer for Weyerhaeuser Mortgage
Company. He has also held various positions with Republic Federal Savings and
Loan, including President of the organization from 1989 to 1992. Mr. Breedlove
is also a Certified Public Accountant.
Mr. Padrick joins the Company as Executive Vice President, Capital Financing. He
will be responsible for managing relationships with warehouse lenders and other
debtholders, and pursuing additional capital financing alternatives. Mr. Padrick
has acted as consultant to businesses with a combination of business and legal
needs. He practiced law with Miller, Nash,
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Wiener, Hager & Carlsen for 15 years where he assisted many organizations with
capital financing needs.
Southern Pacific Funding Corporation is a Lake Oswego, Oregon, based specialty
finance company that originates, purchases and sells home equity loans made to
borrowers whose needs are not met by traditional financial institutions.
Southern Pacific and its subsidiaries originate loans throughout the United
States and in the United Kingdom through diversified origination channels. The
Company's largest shareholder, Imperial Credit Industries, Inc. (NASDAQ:ICII),
currently owns 47% of the Common Stock of the Company.
More information can be found on Southern Pacific Funding Corporation on the
Internet @ http://www.businesswire.com/cnn/sfc.htm
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FOR MORE INFORMATION CONTACT:
David Kiser, CPA
Director of Corporate Communications
Southern Pacific Funding Corporation
(503) 303-2280
SOUTHERN PACIFIC FUNDING CORPORATION ANNOUNCES
LAWSUIT, NEGOTIATIONS WITH LENDERS
LAKE OSWEGO, OR - September 29, 1998 -Southern Pacific Funding Corporation
(NYSE:SFC) announced that it has obtained a temporary restraining order in a
lawsuit filed today against Wilshire Real Estate Partnership, L.P., and related
entities. The proceeding relates to claims that Southern Pacific Funding is in
default with respect to a $40 million loan recently made by Wilshire which is
secured by assets with a market value substantially in excess of the loan
amount. The temporary restraining order enjoins Wilshire from selling the loan
collateral without complying with requirements of the Uniform Commercial Code.
Southern Pacific Funding also stated that it is engaged in discussions with its
warehouse facility lenders with respect to recent notices of default regarding
certain loan covenants. The warehouse lines of credit, which total $1.3 billion,
are used by Southern Pacific Funding to fund loan originations and purchases and
are secured by the loans that the Company originates and purchases. The Company
is seeking to negotiate amended terms for its warehouse lines as part of its
restructuring initiatives. As indicated in earlier reports, the restructuring
program also encompasses changes in top management, execution of significant
whole loan sales, discontinuance of Southern Pacific Funding's strategic
alliance program, and a corporate-wide cost reduction program, including
employee layoffs.
Southern Pacific Funding Corporation is a Lake Oswego, Oregon, based specialty
finance company that originates, purchases and sells home equity loans made to
borrowers whose needs are not met by traditional financial institutions.
Southern Pacific Funding and its subsidiaries originate loans throughout the
United States and in the United Kingdom through diversified origination
channels. The Company's largest shareholder, Imperial Credit Industries, Inc.
(NASDAQ:ICII), currently owns 47% of the Common Stock of Southern Pacific
Funding.
Certain statements in this document contain forward-looking information. For
purposes of the safe harbor provisions for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995, actual results may
differ materially due to a variety of factors, including that there can be no
assurance that Southern Pacific Funding will ultimately prevail in the
proceeding brought against Wilshire Real Estate Partnership, L.P., and related
entities, that it will be able to restructure its warehouse facilities on terms
acceptable to Southern Pacific Funding or its existing lenders, or that the
Company will otherwise be able to successfully implement its restructuring
program, as well as other risks identified in Southern Pacific Funding's
Securities and Exchange Commission filings.
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More information may be found on Southern Pacific Funding Corporation on the
Internet @ http://www.sp-funding.com
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