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
March 3, 1999 0-21845
Date of report (Date of Commission File Number
earliest event reported)
Wilshire Financial Services Group Inc.
(Exact name of registrant as specified in its charter)
Delaware 93-1223879
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification Number)
1776 SW Madison Street, Portland, OR 97205
(Address of principal executive offices) (Zip Code)
(503) 223-5600
Registrant's telephone number, including area code
Not Applicable
(Former name or former address,
if changed since last report)
Item 3. BANKRUPTCY OR RECEIVERSHIP.
On March 3, 1999, Wilshire Financial Services Group Inc.
(the "Company") filed a voluntary petition for a prepackaged plan
of reorganization with the United States Bankruptcy Court for the
District of Delaware (the "Court"), which assumed jurisdiction
over the Company as a debtor-in-possession subject to the
supervision and orders of the Court. The prepackaged plan was
overwhelmingly approved by noteholders, and the confirmation
hearing for approval of the plan has been scheduled for April 12,
1999.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
The following exhibit is filed as part of this report:
99.1 Press Release Dated February 1, 1999
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.
WILSHIRE FINANCIAL SERVICES
GROUP INC.
Date: March 18, 1999 By: /s/ Lawrence A. Mendelsohn
Lawrence A. Mendelsohn
President
By: /s/ Chris Tassos
Chris Tassos
Executive Vice President and
Chief Financial Officer
EXHIBIT 99.1
WILSHIRE FINANCIAL SERVICES RESTRUCTURING PLAN APPROVED BY
NOTEHOLDERS; PLAN FILED WITH COURT
(PORTLAND, Ore., March 3, 1999) Wilshire Financial Group Inc.
(NASDAQ: WFSG) today announced that holders of its outstanding
notes have overwhelmingly approved the terms of its previously
described restructuring plan with 96% of voters accepting. As a
result of this, the company can move forward with the
restructuring process by filing its voluntary petition for
reorganization with the United States Bankruptcy Court for the
District of Delaware.
The restructuring will only affect the public parent
company, Wilshire Financial Services Group, and will not affect
any of the daily operations of the Company's subsidiaries,
including Wilshire Funding Corporation, Wilshire Servicing
Corporation and Wilshire's European operations. Payments to
lenders and trade creditors will continue in the ordinary course
of business. The plan also resolves all outstanding obligations
between the Company and Wilshire Real Estate Investment Trust
Inc., a separate public company.
"The approval of the restructuring plan by our noteholders
and the filing with the court represent two key steps in the
process we first outlined in October," said Andrew A. Wiederhorn,
Chairman and Chief Executive Officer of Wilshire Financial
Services Group. "We anticipate that the plan should be approved
by the court in mid-April, at which point we will emerge with a
stable capital base that will allow the Company to again focus on
its core strengths of buying and servicing mortgage loan
portfolios. First Bank of Beverly Hills has been and will
continue to buy assets throughout the restructuring process."
"The Company has secured debtor-in-possession financing
which will further solidify the restructuring plan," continued
Wiederhorn. "The combination of the restructuring, current cash
balances, and the stabilizing of external markets should allow
us, in due course, to return to profitability."
The Company's notes, totaling approximately $184 million,
consist of 13% Notes due 2004 and 13% Series B Notes due 2004.
Under the plan, the $184 million of outstanding notes will
be exchange into 100% of the common stock of the reorganized
company. A portion of the new common stock may be reallocated so
that the current shareholders may receive up to 0.5% of the
outstanding shares of the new common stock in lieu of their
present stock. The plan also provides for the acquisition of the
loan servicing assets of Wilshire Credit Corporation, a private
company. The Company then will be able to service its own assets
and provide third party servicing. This should produce
additional revenues for the Company and eliminate potential
conflicts of interest.
Wilshire Financial Services Group Inc. is a diversified
financial services company conducting business in the U.S., U.S.
Territories and Europe. The Company specializes in loan
portfolio acquisition, mortgage banking, and servicing. It
offers wholesale banking through a subsidiary, First Bank of
Beverly Hills, F.S.B. The Company is headquartered in Portland,
Oregon, USA and has offices throughout the United States and in
the United Kingdom, France and Ireland.
The Private Securities Litigation Reform Act of 1995
provides a "safe harbor" for forward-looking statements so long
as those statements are identified as forward-looking and are
accompanied by meaningful cautionary statements identifying
important factors that could cause actual results to differ
materially from those projected in such statements. All of the
statements contained in this release which are not identified as
historical should be considered forward-looking. In connection
with certain forward-looking statements contained in this release
and those that may be made in the future by or on behalf of the
Company which are identified as forward-looking, the Company
notes that there are various factors that could cause actual
results to differ materially from those set forth in any such
forward-looking statements. Such factors include but are not
limited to, the real estate market, the availability of pools of
loans at acceptable prices, the availability and conditions of
financing for loan pool acquisitions and mortgage-backed
securities, interest rates and overseas expansion. Accordingly,
there can be no assurance that the forward-looking statements
contained in this release will be realized or that actual results
will not be significantly higher or lower. Readers of this
release should consider these facts in evaluating the information
contained herein. The inclusion of the forward-looking
statements contained in this release should not be regarded as
representation by the Company or any other person that the
forward-looking statements contained in this release will be
achieved. In light of the foregoing, readers of this release are
cautioned not to place undue reliance on the forward-looking
statements contained herein.
