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PROSPECTUS
GREYHOUND FINANCIAL CORPORATION
SENIOR DEBT SECURITIES
Greyhound Financial Corporation ("Company" or "GFC") may offer from time to
time up to $750 million aggregate principal amount of its senior debt securities
("Securities") on terms to be determined at the time of sale. The Securities may
be issued in one or more series with the same or various maturities at or above
par or with an original issue discount and may be issued in fully registered
form or in the form of one or more global securities (each a "Global Security").
The specific designation, the aggregate principal amount, the maturity, the
purchase price, the rate (which may be fixed or variable) and time of payment of
any interest, any sinking fund, any terms of redemption at the option of the
Company or the holder, and other specific terms of the Securities in respect of
which this Prospectus is being delivered ("Offered Securities") are set forth in
an accompanying prospectus supplement ("Prospectus Supplement"), together with
the terms of offering of the Offered Securities.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
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THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL.
The Offered Securities may be offered through underwriters, agents or
dealers. If underwriters are used, it is expected that the managing underwriters
will include Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Citicorp Securities, Inc., Goldman, Sachs & Co., Lehman Brothers,
Lehman Brothers Inc. and Salomon Brothers Inc. If an underwriter, agent or
dealer is involved in the offering of any Offered Securities, the underwriter's
discount, agent's commission or dealer's purchase price will be set forth in, or
may be calculated from, the Prospectus Supplement, and the net proceeds to the
Company from such offering will be the public offering price of the Offered
Securities less such discount in the case of an underwriter, the purchase price
of the Offered Securities less such commission in the case of an agent or the
purchase price of the Offered Securities in the case of a dealer, and less, in
each case, the other expenses of the Company associated with the issuance and
distribution of the Offered Securities. See "Plan of Distribution."
The date of this Prospectus is March 11, 1994.
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IN CONNECTION WITH AN OFFERING, THE UNDERWRITERS FOR SUCH OFFERING MAY
OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE
OF THE OFFERED SECURITIES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY
TIME.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports and other information can be
inspected and copied at Room 1024 at the public reference facilities maintained
by the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as
the Regional Offices of the Commission at Northwestern Atrium Center, Suite
1400, 500 West Madison Street, Chicago, Illinois 60661-2511 and 7 World Trade
Center, New York, New York 10048, and copies can be obtained by mail from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at the prescribed rates. Reports and other information
concerning the Company can also be inspected at the office of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Incorporated herein by reference are the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1993 and Current Reports on Form
8-K, 8-K/A and 8-K/A-1 dated February 14, 1994 filed pursuant to Section 13 of
the Exchange Act with the Commission.
All documents subsequently filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act prior to the termination of the offering
of the Securities shall be deemed to be incorporated by reference in this
Prospectus and to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge upon written or oral request by any
person to whom this Prospectus is delivered a copy of any or all of the
documents described above which have been incorporated by reference in this
Prospectus, other than exhibits to such documents. Such request should be
directed to Robert J. Fitzsimmons, Vice President-Treasurer, Greyhound Financial
Corporation, Dial Tower, Phoenix, Arizona 85077, telephone number (602)
207-4900.
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GREYHOUND FINANCIAL CORPORATION
Greyhound Financial Corporation, a Delaware corporation (the "Company"),
engages in the business of providing secured financing of selected commercial
and real estate activities in the United States and intermediate-term lending on
a secured basis in foreign countries. The Company accomplishes this through
secured loans and leases. The Company is in the process of winding down the
London based financing operations of Greyhound European Financial Group
("GEFG").
The Company generates interest and other income through charges assessed on
outstanding loans, loan servicing, leasing and other fees. The Company's primary
expenses are the costs of funding its loan business (including interest paid on
debt), provisions for possible credit losses, marketing expenses, salaries and
employee benefits, servicing and other operating expenses and income taxes.
The Company's current emphasis is on secured lending to businesses in
specific industry niches, where the Company's expertise in evaluating the needs
and credit worthiness of prospective customers enables it to provide specialized
financing services. The Company's strategy has been to seek to maintain a
high-quality portfolio, using clearly defined underwriting standards in an
effort to minimize the level of non-earning assets and write-offs.
The Company's activities include:
- Corporate Finance. The Corporate Finance group provides financing,
generally in the range of $2 million to $25 million, focusing on middle
market businesses nationally, including distribution, wholesale, retail,
manufacturing and service industries. The group's lending is primarily in
the form of term loans secured by the assets of the borrower, with
significant emphasis on cash flow as the source of repayment of the
secured loan.
- Transportation Finance. Through the Transportation Finance group, the
Company structures secured financings for specialized areas of the
transportation industry, principally involving domestic and foreign used
aircraft, as well as domestic short-line railroads and used rail
equipment. Typical transactions involve financing up to 80% of the fair
market value of used equipment in the $3 million to $30 million range.
Traditionally focused on the domestic marketplace, Transportation Finance
established a London, England office in 1992, broadening its product line
to include international aircraft loans.
- Communications Finance. The Communications Finance group specializes in
radio and television. Other markets include cable television, print and
outdoor media services in the United States. The Company extends secured
loans to communications businesses requiring funds for recapitalization,
refinancing or acquisition. Loan sizes generally are from $3 million to
$35 million.
- Commercial Real Estate Finance. The Commercial Real Estate group
provides cash-flow-based financing primarily for acquisitions and
refinancings to experienced real estate developers and owner tenants of
income-producing properties in the United States and the United Kingdom.
The Company concentrates on secured financing opportunities, generally
between $3 million and $30 million, involving senior mortgage term loans
on owner-occupied commercial real estate. The Company's portfolio of real
estate leveraged leases is also managed as part of the commercial real
estate portfolio.
- Resort Finance. The Resort Finance group focuses on successful,
experienced resort developers, primarily of timeshare resorts, second
home resort communities, golf resorts and resort hotels. Extending funds
through a variety of lending options, the Resort Finance group provides
loans and lines of credit ranging from $3 million to $30 million for
construction, acquisitions, receivables financing and purchases and other
uses. Through its subsidiary, GFC Portfolio Services, Inc. ("GPS"), the
Resort Finance group offers expanded convenience and service to its
customers. Professional receivables collections and cash management gives
developers the ability of having loan-related administrative functions
performed for them by the Company.
- Asset Based Finance. Acquired in early 1993, the Asset Based Finance
group ("ABF") offers a full range of nationwide collateral-oriented
lending programs to midde-market businesses including
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manufacturers, wholesalers and distributors. The Company's ABF group mainly
provides revolving lines of credit ranging between $2 million and $25 million,
often partnering with the Corporate Finance group to offer convenient "one-stop"
financing to businesses.
- Consumer Rediscount Finance. The Consumer Rediscount Group ("CRG")
offers $2 million to $25 million revolving credit lines to regional
consumer finance companies which in turn extend credit to consumers. The
Company's customers provide credit to consumers to finance home
improvements, automobile purchases, insurance premiums and for a variety
of other financial needs.
- Ambassador Factors. On February 14, 1994, the Company purchased Fleet
Factors Corp., better known as Ambassador Factors, from Fleet Financial
Group, Inc. Ambassador Factors provides accounts receivable factoring and
asset-based lending principally to small and medium-sized textile and
apparel manufacturers and importers.
- TriCon. On March 4, 1994, GFC Financial Corporation ("GFC Financial")
announced the signing of a definitive purchase agreement under which the
Company will acquire TriCon Capital Corporation ("TriCon"), an indirect
wholly-owned subsidiary of Bell Atlantic Corporation. This transaction is
subject to regulatory approvals and certain other conditions. TriCon is a
$1.8 billion niche-oriented provider of commercial and equipment leasing
services. TriCon's marketing orientation fits well with the Company's
emphasis on value-added products and services in focused niches of the
commercial finance business and further diversifies the Company's asset
base.
In conjunction with the liquidation of the GEFG portfolio, GEFG surrendered
the banking license of its United Kingdom bank, Greyhound Bank PLC, and renamed
the company Greyhound Guaranty Limited ("GGL"). GGL operates a finance group
that was primarily involved in lending to individuals in the United Kingdom
secured by second mortgages on residential real estate. The group ceased writing
new consumer finance business in the first quarter of 1991 but continues to
administer and collect loans previously made.
The Company was incorporated under the laws of Delaware in 1965 and is the
successor to a California corporation which commenced operations in 1954. The
principal executive offices of the Company are located at Dial Tower, 1850 N.
Central Avenue, Phoenix, Arizona 85004, and its telephone number is (602)
207-4900. All of the capital stock of the Company is owned by GFC Financial, the
common stock of which is publicly traded on the New York Stock Exchange. GFC
Financial owns substantially all of the financial services businesses
(principally the Company) previously owned by its former parent, The Dial Corp.
RATIO OF INCOME TO FIXED CHARGES
The following table sets forth the Company's ratios of income to fixed
charges ("ratio") for each of the past five years.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
- ----------------------------------------
1993 1992 1991 1990 1989
- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
1.51 1.38 -- 1.24 1.23
---- ---- ---- ----
---- ---- ---- ----
</TABLE>
Variations in interest rates generally do not have a substantial impact on
the ratio because the fixed-rate and floating-rate assets are generally matched
with liabilities of similar rate and term.
Income available for fixed charges, for purposes of the computation of the
ratio of income to fixed charges, consists of the sum of income before income
taxes (adjusted for the effect of reduced tax rates on income from leveraged
leases) and fixed charges. Fixed charges include interest and related debt
expense and a portion of rental expense determined to be representative of
interest.
For the year ended December 31, 1991, earnings were inadequate to cover
fixed charges by $35,256,000. This inadequacy was due to certain restructuring
and other charges of $65,000,000 and transaction costs of
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$13,000,000 recorded in the fourth quarter of 1991 in connection with the
transfer by The Dial Corp to GFC Financial of its financial services and
insurance businesses, including the Company.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement with respect to the
proceeds from the sale of the particular Offered Securities to which such
Prospectus Supplement relates, the net proceeds to be received by the Company
from the sale of the Securities will be added to the Company's general funds and
are intended to be used for general corporate purposes, which may include
without limitation, the reduction of short-term debt or the refinancing of
long-term debt. Subject to the application by the Company of such net proceeds
to general corporate purposes or such other use set forth in such Prospectus
Supplement, the Company will hold such funds in trust.
DESCRIPTION OF SECURITIES
The Securities will be issued under an Indenture, dated as of September 1,
1992, as supplemented and amended from time to time (hereinafter called the
"Indenture"), between the Company and The Chase Manhattan Bank, N.A., as Trustee
(the "Trustee"). A copy of the Indenture is filed as an exhibit to the
Registration Statement. The following statements do not purport to be complete
and are subject to the detailed provisions of the Indenture, to which reference
is hereby made, including the definition of certain terms used herein without
definition.
GENERAL
The Securities offered by this Prospectus will be limited to $750,000,000
aggregate principal amount. Prior to the date of this Prospectus, the Company
has issued $300,000,000 aggregate principal amount of such Securities. The
Indenture does not limit the aggregate principal amount of Securities which may
be offered thereunder and provides that Securities may be issued in one or more
series, in each case as authorized from time to time by the Company. The
Securities will be unsecured general obligations of the Company and will not be
subordinated to any other general indebtedness of the Company. Reference is made
to the Prospectus Supplement together with any pricing supplement thereto
relating to the Offered Securities for the following terms thereof:
(1) the title of the Offered Securities;
(2) any limit upon the aggregate principal amount of the Offered
Securities;
(3) the date or dates on which the principal of the Offered Securities
shall be payable;
(4) the rate or rates (which may be fixed or variable) at which the
Offered Securities shall bear interest, or the method by which such rate or
rates shall be determined;
(5) the date or dates from which such interest shall accrue, or the
method by which such date or dates shall be determined, the dates on which
such interest shall be payable and any record dates therefor;
(6) the place or places where the principal of, premium, if any, and
interest on the Offered Securities shall be payable;
(7) the period or periods within which, the price or prices at which
and the terms and conditions upon which the Offered Securities may be
redeemed, in whole or in part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem, purchase or
repay the Offered Securities pursuant to any sinking fund or analogous
provision or at the option of a holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which the Offered Securities shall be redeemed, purchased or repaid
pursuant to such obligation;
(9) if other than the principal amount thereof, the percentage of the
principal amount of the Offered Securities payable upon declaration of
acceleration of the maturity of the Offered Securities;
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(10) whether the Offered Securities are to be issued in whole or in
part in global form ("Global Securities") and, if so, the identity of the
Depositary for such Global Securities, and the terms and conditions, if
any, upon which interests in such Global Securities may be exchanged, in
whole or in part, for the individual Securities represented thereby;
(11) any deletions from, modifications of, or additions to the events
of default or covenants of the Company with respect to any of the Offered
Securities; and
(12) any other terms of the Offered Securities none of which shall be
inconsistent with the provisions of the Indenture (Section 2.02).
The Company may authorize the issuance and provide for the terms of a
series of Securities pursuant to a resolution of its Board of Directors or any
duly authorized committee thereof or pursuant to a supplemental indenture.
The Securities may be issued in registered form. Securities of a series may
be issued in whole or in part in the form of one or more Global Securities, as
described below under "Global Securities." Unless the Prospectus Supplement
relating thereto specifies otherwise, Securities will be issued only in
denominations of $1,000 or any integral multiple thereof (Section 2.01). One or
more Global Securities will be issued in a denomination or denominations equal
to the aggregate principal amount of Outstanding Securities of the series to be
represented by such Global Security or Securities (Section 3.01).
Securities (other than a Global Security) may be presented for exchange and
registration of transfer (with the form of transfer endorsed thereon duly
executed) at the office of the Company designated for such purpose or at the
office of any transfer agent or at the office of any Security Registrar, without
service charge and upon payment of any taxes and other governmental charges as
described in the Indenture. Securities may initially be presented for
registration of transfer or exchange at the Company's principal business office,
Dial Tower, Phoenix, Arizona 85077 and at the Principal Office of the Trustee at
4 Chase MetroTech Center, 3rd Floor, Brooklyn, New York 11245. Securities (other
than a Global Security) in the several denominations will be interchangeable
without service charge, but the Company may require payment to cover taxes or
other governmental charges. The Trustee initially will act as authenticating
agent under the Indenture (Sections 1.02, 2.05 and 5.02).
PAYMENT AND PAYING AGENTS
Payment of principal of and premium, if any, on Securities (other than a
Global Security) will be made against surrender of such Securities at the
Principal Office of the Trustee in The City of New York. Payment of any
installment of interest on Securities will be made to the person in whose name
such Security is registered at the close of business on the record date for such
interest. Unless otherwise indicated in the Prospectus Supplement, payments of
such interest will be made at the Principal Office of the Trustee in The City of
New York, or, at the option of the Company, by check mailed by first class mail
to registered holders of a Security at such holder's registered address
(Sections 2.01 and 5.02).
All moneys paid by the Company to a paying agent for the payment of
principal of or premium, if any, or interest on any Security that remain
unclaimed at the end of three years after such principal, premium or interest
shall have become due and payable will be repaid to the Company and the holder
of such Security entitled to receive such payment will thereafter look only to
the Company for payment therefor (Section 11.03).
GLOBAL SECURITIES
The Securities of a series may be issued in whole or in part in global
form. A Security in global form will be deposited with, or on behalf of, a
Depositary, which will be identified in an applicable Prospectus Supplement. A
Global Security may be issued in either registered or bearer form and in either
temporary or permanent form. A Security in global form may not be transferred
except as a whole by the Depositary for such Global Security to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary
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or another nominee of such Depositary or by such Depositary or any such nominee
to a successor of such Depositary or a nominee of such successor (Section 2.05).
If a Depositary for Securities of a series is at any time unwilling or
unable to continue as Depositary and a successor depositary is not appointed by
the Company within ninety days, the Company will issue Securities of such series
in definitive form in exchange for the Global Security or Securities
representing Securities of such series. In addition, the Company may at any time
and in its sole discretion determine not to have any Securities of a series
represented by one or more Global Securities and, in such event, will issue
Securities of such series in definitive form in exchange for the Global Security
or Securities representing Securities. Further, if the Company so specifies with
respect to the Securities of a series, each Person specified by the Depositary
of the Global Security representing Securities of such series may, on terms
acceptable to the Company and the Depositary for such Global Security, receive
Securities of such series in definitive form. In any such instance, each Person
so specified by the Depositary of the Global Security will be entitled to
physical delivery in definitive form of Securities of the series represented by
such Global Security equal in principal amount to such Person's beneficial
interest in the Global Security (Section 2.05).
If any Securities of a series are issuable in global form, the applicable
Prospectus Supplement will describe the additional circumstances, if any, under
which beneficial owners of interests in any such Global Security may exchange
such interests for definitive Securities of such series and of like tenor and
principal amount in any authorized form and denomination, the manner of payment
of principal of, premium and interest, if any, on any such Global Security and
the material terms of the depositary arrangement with respect to any such Global
Security.
CERTAIN DEFINITIONS
The following terms are defined substantially as follows in Section 1.02 of
the Indenture and are used herein as so defined. For the purposes of the
following terms, all items shall be determined in accordance with generally
accepted accounting principles, unless otherwise indicated.
"Consolidated Net Tangible Assets" means the total of all assets reflected
on a consolidated balance sheet of the Company and its consolidated
Subsidiaries, at their net book values (after deducting related depreciation,
depletion, amortization and all other valuation reserves which, in accordance
with generally accepted accounting principles, should be set aside in connection
with the business conducted), but excluding goodwill, unamortized debt discount
and all other like intangible assets, less the aggregate of the current
liabilities of the Company and its consolidated Subsidiaries reflected on such
balance sheet. For purposes of this definition, "current liabilities" include
all indebtedness for money borrowed, incurred, issued, assumed or guaranteed by
the Company and its consolidated Subsidiaries, and other payables and accruals,
in each case payable on demand or due within one year of the date of
determination of Consolidated Net Tangible Assets, but shall exclude any portion
of long-term debt maturing within one year of the date of such determination,
all as reflected on such consolidated balance sheet of the Company and its
consolidated Subsidiaries.
"Lien" means any lien, charge, security interest, right of another under
any conditional sale or other title retention agreement or any other encumbrance
affecting title to property, including any lease under a sale and leaseback
arrangement.
"Subsidiary" means any corporation a majority of the Voting Stock of which
is owned, directly or indirectly, by the Company or by one or more Subsidiaries
or by the Company and one or more Subsidiaries. "Restricted Subsidiary" is any
Subsidiary a majority of the Voting Stock of which is owned, directly, by the
Company or by one or more Restricted Subsidiaries or by the Company and one or
more Restricted Subsidiaries and which is designated as such by resolution of
the Board of Directors of the Company. "Unrestricted Subsidiary" means any
Subsidiary other than a Restricted Subsidiary.
"Voting Stock" means stock of any class or classes (however designated)
having ordinary voting power for the election of a majority of the members of
the board of directors (or any governing body) of such corporation, other than
stock having such power only by reason of the happening of a contingency.
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LIMITATION ON LIENS
The Indenture provides that the Company will not, and will not permit any
Restricted Subsidiary to, create, assume, incur or suffer to be created, assumed
or incurred or to exist any Lien upon any of the properties of any character of
the Company or any Restricted Subsidiary without making effective provision for
securing the Securities equally and ratably with any other obligation or
indebtedness so secured, other than: (i) leases of property in the ordinary
course of business or in the event that such property is not needed in the
operation of the business; (ii) Liens securing indebtedness incurred to finance
the acquisition of the property subject to the Lien, and in respect of which the
creditor has no recourse against the Company or any Restricted Subsidiary except
recourse to such property, or to the proceeds of any sale or lease of such
property or both; (iii) deposits with or security given to a governmental agency
as a condition to the transaction of business or the exercise of a privilege, or
made to enable the Company or a Restricted Subsidiary to maintain self-insurance
or participate in any fund in connection with worker's compensation,
unemployment insurance, old age pensions, or other social security, or as
collateral in connection with any bond on appeal by the Company or any
Restricted Subsidiary from any judgment or in connection with any other judicial
proceedings by or against the Company or any Restricted Subsidiary; (iv) Liens
for taxes or assessments which are not yet due or are payable without penalty or
are being contested in good faith and against which reserves deemed adequate by
the Company or a Restricted Subsidiary have been established, provided that
foreclosure or similar proceedings have not been commenced; (v) Liens of any
judgment, if such judgment shall not have remained undischarged, or unstayed on
appeal or otherwise, for more than six months; (vi) undetermined Liens or
charges incident to construction, mechanics' and other like Liens arising in the
ordinary course of business in respect of obligations which are not overdue or
which are being contested by the Company or any Restricted Subsidiary in good
faith, or deposits to obtain the release of such Liens; (vii) immaterial
encumbrances consisting of zoning restrictions, licenses, easements and
restrictions on the use of real property and minor defects and irregularities in
the title thereto; (viii) other immaterial (in the aggregate) Liens incidental
to the conduct of the Company's or any Restricted Subsidiary's business or the
ownership of its property other than for indebtedness; (ix) banker's liens and
rights of offset in the holders of indebtedness such as commercial paper in the
ordinary course of business; (x) leasehold or purchase rights, exercisable for a
fair consideration, in favor of any Person which arise in transactions entered
into in the ordinary course of business; (xi) Liens on property or shares of
stock of a corporation at the time the corporation becomes a Restricted
Subsidiary or merges into or consolidates with the Company or a Restricted
Subsidiary provided any such Lien is not incurred in anticipation of such
corporation becoming a Restricted Subsidiary or the related merger or
consolidation; (xii) Liens on property at the time the Company or a Restricted
Subsidiary acquires the property; (xiii) Liens in an amount not to exceed in the
aggregate $15,000,000 at any one time outstanding, excluding Liens covered by
clauses (i) through (xii) above; and (xiv) Liens securing the indebtedness of
the Company or a Restricted Subsidiary and the sum of the following does not
exceed 10% of Consolidated Net Tangible Assets: (a) such indebtedness plus (b)
other indebtedness of the Company and its Restricted Subsidiaries secured by
Liens on property of the Company and its Restricted Subsidiaries, excluding
indebtedness secured by a Lien existing as of the date specified in the
Indenture and excluding indebtedness secured by a Lien permitted by one of
clauses (i) through (xiii) above. (Section 5.04).
CONSOLIDATION, MERGER, AND SALE OF ASSETS
The Indenture provides that the Company will not consolidate with, sell or
lease all or substantially all its assets to, or merge with or into any other
corporation, or purchase all or substantially all the assets of another
corporation, unless (i) the Company shall be the continuing corporation, or the
successor, transferee or lessee corporation is organized under the laws of the
United States of America or any state thereof and assumes the Company's
obligations under the Securities and the Indenture and (ii) immediately after
giving effect to such transaction, no default will have occurred and be
continuing. A purchase by a Subsidiary of all or substantially all of the assets
of another corporation shall not be deemed to be a purchase of such assets by
the Company (Section 5.06). Notwithstanding the foregoing, if, upon any such
consolidation or merger of the Company with or into any other corporation, or
upon any conveyance of the property of the Company as an entirety or
substantially as an entirety to any other corporation, any properties of any
character owned by the Company
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immediately prior thereto would thereupon become subject to any Lien,
simultaneously with such consolidation, merger or conveyance, effective
provision will be made to secure the Securities outstanding equally and ratably
with the debt secured by such Lien (Section 14.01).
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
without the consent of the holders of the Securities, to, among other things,
establish the form and terms of any series of the Securities issuable thereunder
by one or more supplemental indentures, and, with the consent of the holders of
not less than 66 2/3% in the aggregate principal amount of the Securities then
outstanding which are affected thereby, to modify and alter the terms of the
Indenture or any supplemental indenture or the rights of the holders of the
Securities of such series to be affected, except that no such modification or
alteration may be made which will (i) extend the fixed maturity of any
Securities, or reduce the rate or extend the time of payment of interest
thereon, or reduce the amount of the principal thereof, or reduce any premium
payable upon the redemption thereof, or make the principal thereof or interest
or premium thereon payable in any coin or currency other than that provided in
the Securities, or impair the right to institute suit for the enforcement of any
such payment on or after the maturity thereof, without the consent of the holder
of each Indenture Security so affected, or (ii) reduce the percentage of
Securities of any series, the holders of which are required to consent to any
such supplemental indenture, without the consent of the holders of all the
Securities then outstanding, or (iii) modify, without the written consent of the
Trustee, the rights, duties or immunities of the Trustee (Sections 13.01 and
13.02).
DEFAULTS
The Indenture provides that events of default with respect to any series of
Securities will be (i) default for 30 days in payment of interest upon any
Indenture Security of such series; (ii) default in payment of principal (other
than on sinking fund redemption) or premium, if any, on any Indenture Security
of such series; (iii) default for 30 days in payment of any sinking fund
instalment when due by the terms of the Securities of such series; (iv) default,
for 90 days after written notice to the Company by the Trustee or the holders of
at least 25% in aggregate principal amount of the Securities of such series then
outstanding, in performance of any other covenant in the Indenture (other than a
covenant included in the Indenture solely for the benefit of a series of
Securities other than such series); (v) default under another instrument or in
respect of another series of Securities resulting in acceleration of maturity of
indebtedness of the Company in an amount exceeding $5,000,000 if such
acceleration is not rescinded or annulled, or such indebtedness shall not have
been discharged, within 10 days after written notice by the Trustee or the
holders of at least 10% in principal amount of the Securities of such series;
(vi) certain events in bankruptcy or insolvency; and (vii) the incurrence of any
other event of default with respect to Securities of such series (Section 6.01).
If an event of default with respect to Securities of any series should occur and
be continuing, either the Trustee or the holders of 25% of the principal amount
of outstanding Securities of such series may declare each Indenture Security of
that series due and payable (Section 6.02). The Company will be required to file
annually with the Trustee a statement of an officer as to the fulfillment by the
Company of its obligations under the Indenture during the preceding year
(Section 5.07).
Holders of a majority in principal amount of the outstanding Securities of
any series will be entitled to control certain actions of the Trustee under the
Indenture and to waive past defaults with respect to such series (Sections 6.02
and 6.06). Subject to the provisions of the Indenture relating to the duties of
the Trustee, the Trustee will not be under any obligation to exercise any of the
rights or powers vested in it by the Indenture at the request, order or
direction of any of the holders of Securities, unless one or more of such
holders of Securities shall have offered to the Trustee reasonable indemnity
(Section 10.01).
If an event of default occurs and is continuing with respect to a series of
Securities, any sums held or received by the Trustee under the Indenture may be
applied to reimburse the Trustee for its reasonable compensation and expenses
incurred prior to any payments to holders of Securities of such series (Section
6.05).
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The right of any holder of Securities of any series to institute action for
any remedy is subject to certain conditions precedent, including a request to
the Trustee by the holders of not less than 25% in principal amount of the
Securities of that series outstanding to take action, and an offer to the
Trustee of reasonable indemnity against liabilities incurred by it in so doing
(Section 6.07).
DEFEASANCE
The Indenture provides that if, any time after the date of the Indenture,
the Company shall deposit with the Trustee, in trust for the benefit of the
holders thereof, (i) funds sufficient to pay, or (ii) such amount of direct
obligations of the United States of America as will or will together with the
income thereon without consideration of any reinvestment thereof be sufficient
to pay, all sums due for principal of, premium, if any, and interest on the
Securities of a particular series, as they shall become due from time to time,
and certain other conditions are met, the Trustee shall cancel and satisfy the
Indenture with respect to such series to the extent provided therein. Such
defeasance is conditioned upon the Company's delivery of an opinion of counsel
that the holders of the Securities of such series will have no federal income
tax consequences as a result of such deposit (Section 11.02).
CONCERNING THE TRUSTEE
The Trustee is one of the banks participating in one revolving credit
agreement with the Company. In addition, the Trustee acts as trustee with
respect to an Indenture dated as of June 1, 1985 (with respect to certain other
of the Company's Medium-Term Notes).
PLAN OF DISTRIBUTION
The Company may offer the Securities directly or through underwriters,
dealers or agents.
If underwriters are used in the offering of Offered Securities, the names
of the managing underwriter or underwriters (expected to be or include Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citicorp
Securities, Inc., Goldman, Sachs & Co., Lehman Brothers, Lehman Brothers Inc.
and Salomon Brothers Inc) and any other underwriters, and the terms of the
transaction, including compensation of the underwriters and dealers, if any,
will be set forth in the Prospectus Supplement relating to such offering. Firms
not so named will have no direct or indirect participation in the underwriting
of such Offered Securities, although such a firm may participate in the
distribution of such Offered Securities under circumstances entitling it to a
dealer's allowance or agent's commission. It is anticipated that any
underwriting agreement pertaining to any Offered Securities will (1) entitle the
underwriters to indemnification by the Company against certain civil liabilities
under the Securities Act of 1933, as amended ("Securities Act"), (2) provide
that the obligations of the underwriters will be subject to certain conditions
precedent, and (3) provide that the underwriters generally will be obligated to
purchase all such Offered Securities if any are purchased.
The Company also may sell Offered Securities to a dealer, as principal. In
such event, the dealer may then resell such Offered Securities to the public at
varying prices to be determined by such dealer at the time of resale. The name
of the dealer and the terms of the transaction will be set forth in the
Prospectus Supplement relating thereto.
Offered Securities also may be offered through agents designated by the
Company from time to time. Any such agent will be named and the terms of any
such agency will be set forth, in the Prospectus Supplement or Pricing
Supplement relating thereto. Unless otherwise indicated in such Prospectus
Supplement or Pricing Supplement, any such agent will act on a best efforts
basis for the period of its appointment.
Dealers and agents named in a Prospectus Supplement may be deemed to be
underwriters (within the meaning of the Securities Act) of the Offered
Securities described therein and, under agreements which may be entered into
with the Company, may be entitled to indemnification by the Company against
certain civil liabilities under the Securities Act. Underwriters, dealers and
agents may engage in transactions with, or perform services for, the Company in
the ordinary course of business.
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If so indicated in a Prospectus Supplement, the Company will authorize
underwriters or other agents of the Company to solicit offers by certain
institutions to purchase the Offered Securities from the Company pursuant to
contracts providing for payment and delivery at a future date. Institutions with
which such contracts may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and others, but in all cases such institutions must be approved by
the Company. The obligations of any purchaser under any such contract will not
be subject to any conditions except that (1) the purchase of the Offered
Securities shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject and (2) if the Offered
Securities are also being sold to underwriters, the Company shall have sold to
such underwriters the Offered Securities not subject to delayed delivery.
The anticipated date of delivery of Offered Securities will be set forth in
the Prospectus Supplement relating to the Offering of such Securities.
LEGAL MATTERS
The legality of the Securities being offered hereby will be passed upon for
the Company by William J. Hallinan, Esq., General Counsel of GFC Financial
Corporation and counsel to the Company. Unless otherwise specified in an
applicable Prospectus Supplement, Brown & Wood will act as counsel for any
underwriters or agents.
EXPERTS
The financial statements of Greyhound Financial Corporation and
consolidated subsidiaries incorporated in this Prospectus by reference to the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1993
are incorporated in reliance upon the report of Deloitte & Touche, independent
auditors, as experts in accounting and auditing.
The financial statements of TriCon Capital Corporation-Predecessor Business
appearing in the Company's Annual Report on Form 10-K for the year ended
December 31, 1993 have been audited by Coopers & Lybrand, independent
accountants, as of the dates and for the periods indicated in their report
thereon (which report includes an explanatory paragraph for certain accounting
changes) included therein and incorporated herein by reference. Such financial
statements are incorporated herein in reliance on such report of Coopers &
Lybrand, independent accountants, given on the authority of that firm as experts
in accounting and auditing.
The financial statements of Fleet Factors Corporation (a wholly-owned
subsidiary of Fleet Financial Group, Inc.) appearing in the Company's Current
Report on Form 8-K dated February 14, 1994 have been audited by KPMG Peat
Marwick, independent auditors, as of the dates and for the periods indicated in
their report thereon included therein and incorporated herein by reference. Such
financial statements are incorporated herein in reliance on such report of KPMG
Peat Marwick, independent auditors, given upon the authority of said firm as
experts in accounting and auditing.
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