UNITED STATES
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 12, 1999
UNITED COMPANIES FINANCIAL CORPORATION
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(Exact name as specified in its charter)
Louisiana 1-7067 71-0430414
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
4041 Essen Lane, Baton Rouge Louisiana 70809
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(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (225) 987-0000
Not Applicable
(Former name or former address, if changed since last report)
PAGE 1
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Item 5. Other Events.
The Registrant files herewith the exhibit listed in Item 7(c) below.
Item 7(c). Exhibits.
The following exhibit is furnished in accordance with Item 601 of
Regulation S-K:
99 Press Release dated May 12, 1999 - United Companies Receives
Approval for Sale of Retail Lending Platform to Aegis Mortgage
Corporation
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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.
UNITED COMPANIES FINANCIAL CORPORATION
(Registrant)
Date: May 13, 1999 By: /s/ MICHAEL W. TRICKEY
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Michael W. Trickey
Chief Financial Officer
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INDEX TO EXHIBITS
EXHIBIT SEQUENTIALLY
NO. EXHIBIT NUMBERED PAGE
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99 Press Release dated May 12, 1999 - United Companies Receives
Approval for Sale of Retail Lending Platform to Aegis Mortgage
Corporation
EXHIBIT 99
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UNITED COMPANIES FINANCIAL CORPORATION
[UNITED COMPANIES LOGO]
NEWS RELEASE
FOR IMMEDIATE DISTRIBUTION
For More Information,
Contact:
Deborah Hicks Midanek
Chief Executive Officer
225-987-2385 or 800-234-8232
RELEASE DATE: May 12, 1999
United Companies Receives Approval for Sale of
Retail Lending Platform to Aegis Mortgage Corporation
Company To Focus on Enhancing its $6.4 Billion Mortgage Servicing
Business
Baton Rouge, LA - United Companies Financial Corporation (OTC:
UCFNE) announced today that the Bankruptcy Court in which its
reorganization proceedings are pending has approved the sale of a
substantial portion of the Company's retail lending platform, UC
Lending(R), to Aegis Mortgage Corporation, a mortgage company based in
Houston, Texas. The Company previously announced on April 28, 1999
that it had reached an agreement with Aegis for the sale, which was
subject to the satisfaction of certain conditions and the approval of
the Bankruptcy Court. Under the terms of the sale, Aegis will pay $3
million plus the May, 1999 operating expenses relating to 127 branch
offices and related retail lending assets. Aegis will also assume
the post-closing obligations under the leases to the 127 branch
offices and under the equipment leases, auto leases and other
contracts and agreements associated with operating these branch
offices and the Baton Rouge home office facilities of the retail
lending platform. In addition, Aegis has agreed to purchase all of
the loans closed by UC Lending(R) during the month of May. The closing
date for the transaction is currently scheduled for June 1, 1999.
The Company confirmed that the remaining 28 branches will be closed
by the end of the month.
The sale was approved after the expiration of a bidding period for
higher or better offers set by the Bankruptcy Court and a hearing
on the proposed sale in Bankruptcy Court. The Court determined that
there were no other viable sale options for the retail origination
business. The Creditor's Committee supported the Company in
seeking approval of the sale. Testimony by the financial advisor
to the Creditor's Committee confirmed the basis for the Company's
decision to enter into the transaction with Aegis. The Court, in
approving the sale, overruled objections by an ad hoc group of
equity holders.
"We are pleased to receive Court approval of this sale of the
retail platform to Aegis Mortgage," said Deborah Hicks Midanek,
Chief Executive Officer of United Companies. "This is an excellent
opportunity for the one thousand UC Lending(R) employees who will
retain their jobs because of this transaction. Moreover, we
believe this sale will aid in preserving value for all of the
Company's stakeholders and will allow us to concentrate on our
mortgage servicing business," she continued.
"United Companies boasts a $6.4 billion servicing portfolio. We are
the seventh largest servicer in the subprime industry, a niche
business which is seeing increased demand," Ms. Midanek continued.
"We have a long history of servicing non-traditional loans and
maintain the infrastructure and seasoned professionals to handle
these unique accounts."
The following is a "Safe Harbor" Statement under the Private
Securities Litigation Reform Act of 1995: The statements contained in
this release that are not historical facts are forward-looking
statements based on the Company's current expectations and beliefs
concerning future developments and their potential effects on the
Company. There can be no assurance that future developments affecting
the Company will be those anticipated by the Company. Actual results
may differ from those projected in the forward-looking statements.
These forward-looking statements involve significant risks and
uncertainties (some of which are beyond the control of the Company)
and are subject to change based upon various factors, including but
not limited to the following risks and uncertainties: the developments
in and outcome of the Company's Chapter 11 reorganization proceedings;
the ability to access loan and warehouse facilities in amounts
necessary to fund the Company's operations; the successful execution
of loan sales in the whole loan sale market; the ability of the
Company to successfully restructure its balance sheet; the ability of
the Company to retain an adequate number and mix of its employees; the
effect of the Company's policies including the amount of Company
expenses; actual prepayment rates and credit losses on loans sold as
compared to prepayment rates and credit losses assumed by the Company
at the time of sale for purposes of its gain on sale computations; the
quality of the Company's owned and serviced loan portfolio including
levels of delinquencies, customer bankruptcies and charge-offs;
adverse economic conditions; competition; various legal, regulatory
and litigation risks and other risks detailed from time to time in the
Company's Securities and Exchange Commission filings. The Company
undertakes no obligation to publicly update or revise any forward-
looking statements, whether as the result of new information, future
events or otherwise.
