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
Date of Report: December 11, 1998
(Date of earliest event reported)
Asset Securitization Corporation (Series 1996 - MDVI)
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(Exact name of registrant as specified in its charter)
Delaware 33-49370-02 13-3672337
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(State or Other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
Two World Financial Center, Building B, New York, New York 10281
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Address of Principal Executive Office
Registrant's telephone number, including area code: (212) 667-9300
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ITEM 5: OTHER EVENTS
Following losses experienced by NACC's subsidiary, The Capital Company of
America LLC ("CCA") and Nomura Holding America Inc. ("NHA") (NACC's parent), the
Board of Directors (the "NSC Board") of the ultimate parent of all of these
companies, Nomura Securities Co., Ltd. ("NSC"), on September 21, 1998 authorized
NSC to provide additional capital to NHA (which, in turn, authorized a capital
contribution to CCA) designed to substantially restore the total capitalization
(shareholder's equity plus subordinated debt) of NHA and CCA to the levels that
existed on April 1, 1998 (that is, approximately $843 million of subordinated
debt and common shareholder's equity) in the case of NHA, and to the level that
existed on June 29, 1998 (that is, approximately $500 million of common
shareholder's equity) in the case of CCA.
As of September 25, 1998, and as authorized by the NSC Board as described
above, NSC made an equity investment in NHA of approximately $380 million, and
acquired (through Nomura Global Funding plc) subordinated debt of NHA in the
amount of approximately $250 million. Accordingly, NHA on or about that time
received a total of approximately $628 million in cash from or at the direction
of NSC and wired approximately $214 million of that amount to CCA as equity
capital. NHA subsequently contributed additional equity of another $214 million
to CCA, based on CCA's mark-to-market losses estimated as of September 28, 1998.
On October 22, 1998, NSC reported that its consolidated after-tax losses for the
six-month period ending September 30, 1998 was $1,504,000,000 and NHA reported
it had incurred a pre-tax loss of $1,160,000,000 for the same period.
Approximately $566,000,000 of NHA's loss was attributable to mark-to-market
losses in the value of CCA's assets. Following the report of those losses, NSC
made an additional equity investment in NHA in the amount of $1,200,000,000.
There can be no assurance that either CCA or NHA will not experience
further losses, that NSC will provide additional capital to NHA or that NHA will
contribute additional capital to CCA. In addition, current market uncertainty
and volatility have had, and may continue to have, further significant adverse
impact on the financial condition and/or operations of CCA and NHA.
In another development, Ethan Penner, who was appointed Chief Executive
Officer and President of CCA at its formation on June 29, 1998, resigned that
office and was appointed Vice Chairman of the Board of Directors of CCA on
August 14, 1998. Mr. Penner resigned as Vice Chairman of the Board of Directors
on September 16, 1998. Also, William Wraith, IV, the co-chief executive officer
and co-president of NHA and the chairman of the Board of Directors of NSI, and
Mark McGauley, the chief operating officer of NHA, have resigned from those
positions and as members of the CCA Board of Managers. On November 20, 1998,
Boyd Fellows and Brian Pilcher, CCA's former Co-Chief Executive Officers
resigned. CCA appointed Michael L. Hurdelbrink as its new Chief Executive
Officer. Hurdelbrink was also appointed President and Chief Executive Officer of
the Depositor. On December 11, 1998, NHA announced that CCA will not undertake
any new loan commitments.
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Pursuant to the requirements of the Securities Act of 1934, the Registrant
has duly caused this report to be signed on behalf of the Registrant by the
undersigned thereunto duly authorized.
ASSET SECURITIZATION CORPORATION
By: /s/ Michael Hurdelbrink
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Name: Michael Hurdelbrink
Title: President & CEO
Date: December 14, 1998
