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): May 21, 1999
SOUTHERN PACIFIC FUNDING CORPORATION
(Exact name of registrant as specified in its charter)
California 1-11785 33-0636924
(State or other jurisdiction Commission File No.) (IRS Employer
of incorporation) Identification No.)
One Centerpointe Drive, Suite 551
Lake Oswego, Oregon 97035
(Address of principal executive offices) (Zip Code)
(503) 684-6316
(Registrant's telephone number, including area code)
Item 5. Other Events.
Southern Pacific Funding Corporation (the "Company"), a debtor in
possession under Chapter 11 of the Bankruptcy Code, held an auction process on
Friday, May 21, 1999, between two competing bidders, as a result of which it has
agreed to improved terms for the acquisition of the Company and certain assets
of the Company by The Goldman Sachs Group, Inc., and its affiliates ("Goldman
Sachs"). The cash portion of the sales price to be paid by Goldman Sachs
increased to approximately $38.75 million from $35.0 million. The balance of the
sales price is represented by the right to receive a percentage of the cash
flows from certain financial assets, which include subordinated interest only
and residual certificates representing interests in the Company's mortgage loan
pool securitization trusts, the right to prepayment income from the trusts and
mortgage loan servicing rights.
Prior to the sale of the Company to Goldman Sachs, certain remaining
assets will be distributed to a liquidating trust (the "Liquidating Trust")
established for the benefit of the Company's creditors. The agreement to share
the cash flow will be in the form of an instrument given by the reorganized
Company to the Liquidating Trust, pursuant to which funds will be distributed to
the Liquidating Trust. The Liquidating Trust will be responsible for making
distributions to creditors.
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The Company has also filed its first amended plan of reorganization and
disclosure statement dated May 27, 1999, with the Bankruptcy Court. The plan and
disclosure statement describe, among other things, the terms of the proposed
sale transaction with Goldman Sachs and the projected distribution amounts to
various classes of the Company's creditors. A hearing on the adequacy of the
disclosure statement will be held on June 1, 1999, with distribution of copies
of the plan of reorganization and disclosure statement to the Company's
creditors and equity holders to occur promptly after approval of the disclosure
statement. Copies of the plan of reorganization and disclosure statement are
available on the Company's website at www.sp-funding.com.
Final consummation of the sale transaction with Goldman Sachs is
subject to confirmation of the Company's plan of reorganization by the
Bankruptcy Court. The hearing on confirmation on the plan is currently scheduled
for July 7, 1999. The transaction presently is expected to close on or before
July 31, 1999.
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.
SOUTHERN PACIFIC FUNDING CORPORATION
Dated: May 28, 1999 By: /S/ Timothy Breedlove
Name: Timothy Breedlove
Title: Chief Financial Officer
