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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) November 25, 1997
SEARCH FINANCIAL SERVICES INC.
(Exact name of registrant as specified in charter)
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DELAWARE 0-9539 41-1356819
(State or other jurisdiction of incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
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600 N. PEARL STREET
SUITE 2500
DALLAS, TEXAS 75201-2899
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214) 965-6000
NOT APPLICABLE
(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On November 25, 1997, Registrant announced that it had entered into a
Stipulation of Settlement to settle the noteholder class action litigation
filed against it in Federal Court in Mississippi in December 1995 styled Janice
and Warren Bowe, et al. v. Search Capital Group, Inc., et al. and all claims
held by the Litigation Trust established under the plan of reorganization of
Registrant's fund subsidiaries, including the lawsuit filed by the Trustee of
the Litigation Trust in the Bankruptcy Court for the Northern District of Texas
in August 1997.
Under the terms of the Settlement, Registrant will be required to pay
$362,500 in cash and to issue shares of its common stock having a value of
$1,787,500. The number of shares of Registrant's common stock will be based on
the average closing sales price of the common stock for the 30 trading days
ending December 15, 1997. If, however, such average price would result in the
issuance of shares exceeding 20% of the number of shares of Registrants' common
stock outstanding, Search may pay the difference in cash or the Litigation
Trustee may agree to use a five-day average price. The Settlement is subject
to various conditions, including approval by the Federal Court in Mississippi
and the Bankruptcy Court. If all conditions are satisfied, the Settlement is
expected to be completed by year end.
Registrant has a reserve of $500,000 related to the Bowe Action.
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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 hereunto duly authorized.
SEARCH FINANCIAL SERVICES INC.
By: /s/ ELLIS A. REGENBOGEN
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Ellis A. Regenbogen
Executive Vice President
Dated: December 1, 1997
