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RULE 424(b)(5)
FILE NO. 33-52845
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JANUARY 25, 1995.
$125,000,000
G F C
GREYHOUND FINANCIAL CORPORATION
_______________________________
8% Notes Due January 15, 1997
Interest payable July 15 and January 15
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The Notes will not be redeemable at the option of the Company prior to maturity.
The Notes will be represented by one or more Global Securities (as defined
herein) registered in the name of The Depository Trust Company ("DTC").
Except as provided herein and in the accompanying Prospectus, Notes in
definitive form will not be issued. Settlement for the Notes will be
made in immediately available funds. The Notes will trade in DTC's
Same-Day Funds Settlement System until maturity, and secondary
market trading activity for the Notes will therefore settle
in immediately available funds. See "Description of Notes" herein.
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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 SUPPLEMENT OR THE PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<S> <C> <C> <C>
Underwriting
Price to Discounts and Proceeds to
Public(1) Commissions Company(2)
_________ _____________ ___________
Per Note.................................... 99.89% .3% 99.59%
Total....................................... $124,862,500 $375,000 $124,487,500
</TABLE>
(1) Plus accrued interest, if any, from date of issuance.
(2) Before deduction of expenses payable by the Company estimated at $129,000.
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The Notes are offered by the Underwriter when, as and if issued by the
Company, delivered to and accepted by the Underwriter and subject to its right
to reject orders in whole or in part. It is expected that delivery of the Notes,
in book-entry form, will be made through the facilities of DTC on or about
January 31, 1995 against payment in immediately available funds.
CS First Boston
The date of this Prospectus Supplement is January 25, 1995.
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IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES AT A
LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
GREYHOUND FINANCIAL CORPORATION
Greyhound Financial Corporation, a Delaware corporation (the "Company"), is
in the business of providing collateralized financing in focused market niches
primarily in the United States. The Company extends revolving credit facilities,
term loans and equipment and real estate financing to "middle-market" businesses
with financing needs falling generally between $500,000 and $35 million. The
Company also offers financing programs to manufacturers, distributors, vendors
and franchisors which facilitate the sale in the United States of their products
to end-users. The Company currently operates in 15 specific industry or market
niches in which its expertise in evaluating the creditworthiness of prospective
customers and its ability to provide value-added services enables the Company to
differentiate itself from its competitors and to command loan pricing which
provides a satisfactory spread over the Company's borrowing costs.
The Company seeks to maintain a high quality portfolio and to minimize
nonearning assets and write-offs by using clearly defined underwriting criteria,
stringent portfolio management techniques and by diversifying its lending
activities geographically and among a range of industries, customers and loan
products. Because of the diversity of the Company's portfolio, the Company
believes it is better able to manage competitive changes in its markets and to
withstand the impact of deteriorating economic conditions on a regional or
national basis.
Effective February 1, 1995, the name of the Company will be "FINOVA Capital
Corporation."
The Company's activities include:
GFC BUSINESS SEGMENTS
- 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. The Transportation Finance group 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. 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
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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., 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 middle-market businesses including manufacturers,
wholesalers and distributors. The 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 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
Ambassador Factors Corporation, formerly known as Fleet Factors Corp.
("Ambassador Factors"), from Fleet Financial Group, Inc. Ambassador
Factors was merged into the Company in December 1994. Ambassador Factors
provides accounts receivable factoring and asset-based lending in amounts
generally ranging from $500,000 to $3 million, principally to small and
medium-sized textile and apparel manufacturers and importers.
TRICON BUSINESS SEGMENTS
On April 30, 1994, the Company acquired TriCon Capital Corporation
("TriCon"), formerly an indirect wholly-owned subsidiary of Bell Atlantic
Corporation. TriCon was merged into the Company in May 1994. TriCon is a niche
oriented provider of commercial finance and equipment leasing services to a
segmented group of borrowers and lessees throughout the United States. TriCon
conducts its operations through seven specialized business groups which provide
financial products and services to three specific market sectors of the
commercial finance industry; the End-User Sector, the Program Finance Sector and
the Capital Services Sector.
END-USER SECTOR. The customers in the End-User Sector use the assets which
TriCon finances or leases for the ongoing operations of their businesses. The
equipment which TriCon leases to its customers is typically purchased from an
equipment manufacturer, vendor or dealer selected by the customer. The three
specialized business groups associated with this market sector and the services
provided by TriCon to customers of each business group include:
- Medical Finance. Equipment and real estate financing and asset
management services targeting the top 2,400 health care providers in the
United States.
- Commercial Equipment Finance. Direct finance leasing of, and lending
for, general business equipment to quality commercial business
enterprises which lack ready access to the public finance markets.
- Government Finance. Primarily tax-exempt financing to state and local
governments. Due to tax benefit limitations, TriCon sells a substantial
portion of the tax-exempt assets generated by the Government Finance
group through syndications or securitizations to third parties. In
addition, TriCon has generated fee income by arranging for the sale or
originations of such assets through public offerings.
PROGRAM FINANCE SECTOR. TriCon's business groups in the Program Finance
Sector provide financing programs to help manufacturers, distributors, vendors
and franchisors facilitate the sale of their products or
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services. The three specialized business groups associated with this market
sector and the services provided by TriCon to customers of each business group
include:
- Vendor Services. Point-of-sale financing programs and support services
for regional and national manufacturers, distributors and vendors of
equipment classified as "small ticket" in transaction size (generally
transactions with an equipment cost of less than $250,000). The equipment
which TriCon leases to the ultimate end-user is typically sold to TriCon
by the vendor participating in the financing program.
- Franchise Finance. Equipment and total facility financing programs for
the franchise-based food service industry. The equipment which TriCon
leases to the ultimate end-user is typically purchased by TriCon from an
equipment manufacturer, vendor or dealer selected by the end-user.
- Commercial Credit Services. Accounts receivable and inventory lending
for manufacturers and major distributors, manufacturer-sponsored
inventory financing for office equipment dealers and telecommunications
receivables financing for regional providers of long distance operator
services.
CAPITAL SERVICES SECTOR. The Capital Services Sector has one business
group which focuses on the management and origination of highly structured
financing of "large ticket" commercial equipment (generally transactions
involving the sale or lease of equipment with a cost in excess of $15 million),
primarily leveraged leases for major corporations. The equipment which TriCon
leases to its customers is typically purchased from an equipment manufacturer,
vendor or dealer selected by the customer.
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
Corporation ("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. Effective February 1, 1995, the name of GFC
Financial will be "The FINOVA Group Inc."
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 and the nine months ended
September 30, 1994.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
NINE MONTHS ENDED ----------------------------------------
SEPTEMBER 30, 1994 1993 1992 1991 1990 1989
- ------------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
1.56 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.
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For the year ended December 31, 1991, income to cover fixed charges was
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
$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
The net proceeds from the sale of the Notes will be used for general
corporate purposes, including to reduce the Company's outstanding commercial
paper.
DESCRIPTION OF NOTES
The information herein concerning the Notes should be read in conjunction
with the statements under "Description of Securities" in the accompanying
Prospectus, to which reference is hereby made. The Notes are to be issued as a
separate series of Securities under an Indenture dated as of September 1, 1992
(the "Indenture"), between the Company and The Chase Manhattan Bank, N.A., as
Trustee. A copy of the Indenture has been filed as an exhibit to the
Registration Statement of which the accompanying Prospectus is a part.
GENERAL
The Notes will be limited to $125,000,000 aggregate principal amount and
will mature on January 15, 1997. The Notes will bear interest from the date of
issuance at the rate shown on the front cover of this Prospectus Supplement,
payable semi-annually on July 15 and January 15 in each year, commencing on July
15, 1995, to holders of record on the preceding July 1 and January 1,
respectively. Interest will be calculated on the basis of a 360-day year of
twelve 30-day months. The Notes will not be redeemable at the option of the
Company prior to maturity and will not be subject to any sinking fund.
GLOBAL NOTES, DELIVERY AND FORM
The Notes will be represented by one global security (the "Global
Security") and will be deposited with, or on behalf of, The Depository Trust
Company, in its capacity as depository (the "Depositary"). Except as set forth
below, the Global Security may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary to a
successor of the Depositary or a nominee of such successor.
So long as the Depositary or its nominee is the registered owner of the
Global Security, the Depositary or its nominee, as the case may be, will be the
sole Holder of the Notes represented thereby, and the Trustee and the Company
are only required to treat the Depositary or its nominee as the legal owner of
the Notes, for all purposes under the Indenture. Except as otherwise provided in
this section, the Beneficial Owners (as defined below) of the Global Security
representing the Notes will not be entitled to receive physical delivery of
certificated Notes and will not be considered the Holders thereof for any
purpose under the Indenture, and no Global Security representing the Notes shall
be exchangeable or transferrable. Accordingly, each person owning a beneficial
interest in the Global Security must rely on the procedures of the Depositary
and, if such person is not a Participant, on the procedures of the Participant
through which such person owns its interest to exercise any rights of a Holder
under the Indenture. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in
certificated form. Such limits and such laws may impair the ability to transfer
beneficial interests in the Global Security representing the Notes.
The following is based on information furnished by the Depositary:
The Depositary will act as securities depository for the Notes. The
Notes will be issued as fully registered securities registered in the name
of Cede & Co. (the Depositary's partnership nominee). One fully registered
Global Security will be issued for the Notes, in the aggregate principal
amount of the Notes and will be deposited with the Depositary.
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The Depositary is a limited-purpose trust company organized under the
New York Banking Law, a "banking organization" within the meaning of the
New York Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code,
and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended. The Depositary
holds securities that its participants ("Participants") deposit with the
Depositary. The Depositary also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement
of securities certificates. Direct Participants include securities brokers
and dealers, banks, trust companies, clearing corporations and certain
other organizations. The Depositary is owned by a number of its Direct
Participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc., and the National Association of Securities Dealers, Inc.
Access to the Depositary's system is also available to others such as
securities brokers and dealers, banks and trust companies that clear
through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly ("Indirect Participants"). The rules
applicable to the Depositary and its Participants are on file with the
Securities and Exchange Commission.
Purchases of Notes under the Depositary's system must be made by or
through Direct Participants, which will receive a credit for such Notes on
the Depositary's records. The ownership interest of each actual purchaser
of each Note represented by the Global Security ("Beneficial Owner") is in
turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from the Depositary
of their purchase, but Beneficial Owners are expected to receive written
confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participants
through which such Beneficial Owner entered into the transaction. Transfers
of ownership interests in the Global Security representing the Notes are to
be accomplished by entries made on the books of Participants acting on
behalf of Beneficial Owners. Beneficial Owners of the Global Security
representing the Notes will not receive certificated Notes representing
their ownership interests therein, except in the event that use of the
book-entry system for the Notes is discontinued.
To facilitate subsequent transfers, the Global Security representing
the Notes which is deposited with the Depositary is registered in the name
of the Depositary's partnership nominee, Cede & Co. The deposit of the
Global Security with the Depositary and its registration in the name of
Cede & Co. effect no change in beneficial ownership. The Depositary has no
knowledge of the actual Beneficial Owners of the Global Security
representing the Notes; the Depositary's records reflect only the identity
of the Direct Participants to whose accounts such Notes are credited, which
may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by the Depositary to
Direct Participants, by Direct Participants to Indirect Participants, and
by Direct Participants and Indirect Participants to Beneficial Owners will
by governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time.
Neither the Depositary nor Cede & Co. will consent or vote with
respect to the Global Security representing the Notes. Under its usual
procedures, the Depositary mails an Omnibus Proxy to the Company as soon as
possible after the applicable record date. The Omnibus Proxy assigns Cede &
Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Notes are credited on the applicable record date (identified
in a listing attached to the Omnibus Proxy).
Principal and interest payments on the Global Security representing
the Notes will be made to the Depositary. The Depositary's practice is to
credit Direct Participants' accounts on the applicable payment date in
accordance with their respective holdings shown on the Depositary's records
unless the Depositary has reason to believe that it will not receive
payment on such date. Payments by Participants to Beneficial Owners will be
governed by standing instructions and customary practices, as is the case
with securities held for the accounts of customers in bearer form or
registered in "street name," and will be the
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responsibility of such Participant and not of the Depositary, the Trustee
or the Company, subject to any statutory or regulatory requirements as may
be in effect from time to time. Payment of principal, premium, if any, and
interest to the Depositary is the responsibility of the Company or the
Trustee, disbursement of such payments to Direct Participants shall be the
responsibility of the Depositary, and disbursement of such payments to the
Beneficial Owners shall be the responsibility of Direct and Indirect
Participants.
If the Depositary is at any time unwilling or unable to continue as
Depositary and a successor Depositary is not appointed within 90 days, the
Company will issue certificated Notes in exchange for the Notes represented by
the Global Security. In addition, the Company may at any time and in its sole
discretion determine to discontinue use of the Global Security and, in such
event, will issue definitive Notes in exchange for the Notes represented by the
Global Security. Notes so issued will be issued in denominations of $1,000 and
integral multiples thereof and will be issued in registered form only, without
coupons.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriter in immediately
available funds. All payments or principal and interest will be made by the
Company in immediately available funds. Secondary trading in long-term notes and
debentures of corporate issuers is generally settled in clearing-house or
next-day funds. In contrast, the Notes will trade in the Depositary's Same-Day
Funds Settlement System until maturity or until the Notes are issued in the
definitive form, and secondary market trading activity in the Notes will
therefore be required by the Depositary to settle in immediately available
funds. No assurance can be given as to the effect, if any, of settlement in
immediately available funds on trading activity in the Notes.
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UNDERWRITING
Under the terms and subject to the conditions contained in an Underwriting
Agreement dated January 25, 1995 (the "Underwriting Agreement"), CS First Boston
Corporation (the "Underwriter") has agreed to purchase from the Company all of
the Notes. The Underwriting Agreement provides that the obligations of the
Underwriter are subject to certain conditions precedent and that the Underwriter
will be obligated to purchase all the Notes if any are purchased.
The Company has been advised by the Underwriter that it proposes to offer
the Notes to the public initially at the public offering price set forth on the
cover page of this Prospectus Supplement and to certain dealers at such price
less a concession of .2% of the principal amount per Note, and the Underwriter
and such dealers may allow a discount of .125% of such principal amount per Note
on sales to certain other dealers. After the initial public offering, the public
offering price and concession and discount to dealers may be changed by the
Underwriter.
The Notes are a new issue of securities with no established trading market.
The Underwriter has advised the Company that it intends to act as a market maker
for the Notes. However, the Underwriter is not obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Notes.
The Company has agreed to indemnify the Underwriter against certain
liabilities, including civil liabilities under the Securities Act of 1933, or to
contribute to payments which the Underwriter may be required to make in respect
thereof.
NOTICE TO CANADIAN RESIDENTS
RESALE RESTRICTIONS
The distribution of the Notes in Canada is being made only on a private
placement basis exempt from the requirement that the Company prepare and file a
prospectus with the securities regulatory authorities in each province where
trades of Notes are effected. Accordingly, any resale of the Notes in Canada
must be made in accordance with applicable securities laws which will vary
depending on the relevant jurisdiction, and which may require resales to be made
in accordance with available statutory exemptions or pursuant to a discretionary
exemption granted by the applicable Canadian securities regulatory authority.
Purchasers are advised to seek legal advice prior to any resale of the Notes.
REPRESENTATIONS OF PURCHASERS
Each purchaser of Notes in Canada who receives a purchase confirmation will
be deemed to represent to the Company and the dealer from whom such purchase
confirmation is received that (i) such purchaser is entitled under applicable
provincial securities laws to purchase such Notes without the benefit of a
prospectus qualified under such securities laws, (ii) where required by law,
that such purchaser is purchasing as principal and not as agent, and (iii) such
purchaser has reviewed the text above under "Resale Restrictions".
RIGHTS OF ACTION AND ENFORCEMENT
The securities being offered are those of a foreign issuer and Ontario
purchasers will not receive the contractual right of action prescribed by
section 32 of the Regulation under Securities Act (Ontario). As a result,
Ontario purchasers must rely on other remedies that may be available, including
common law rights of action for damages or rescission or rights of action under
the civil liability provisions of the U.S. federal securities laws.
All of the issuer's directors and officers as well as the experts named in
the Prospectus may be located outside of Canada and, as a result, it may not be
possible for Ontario purchasers to effect service of process within Canada upon
the issuer or such persons. All or a substantial portion of the assets of the
issuer and such persons may be located outside of Canada and, as a result, it
may not be possible to satisfy a judgment against
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the issuer or such persons in Canada or to enforce a judgment obtained in
Canadian courts against such issuer or persons outside of Canada.
NOTICE TO BRITISH COLUMBIA RESIDENTS
A purchaser of Notes to whom the Securities Act (British Columbia) applies
is advised that such purchaser is required to file with the British Columbia
Securities Commission a report within ten days of the sale of any Notes acquired
by such purchaser pursuant to this offering. Such report must be in the form
attached to British Columbia Securities Commission Blanket Order BOR #88/5, a
copy of which may be obtained from the Company. Only one such report must be
filed in respect of Notes acquired on the same date and under the same
prospectus exemption.
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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 $1 billion 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 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 January 25, 1995.
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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 Citicorp 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, Quarterly Reports on Form 10-Q
and 10-Q/A for the quarterly period ended March 31, 1994, Quarterly Reports on
Form 10-Q for the periods ended June 30, 1994 and September 30, 1994, Current
Report on Form 8-K dated January 21, 1994, Current Reports on Forms 8-K, 8-K/A
and 8-K/A-1 dated February 14, 1994, and Current Reports on Form 8-K dated April
18, 1994, May 2, 1994, May 23, 1994, July 20, 1994 and October 20, 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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<PAGE> 12
GREYHOUND FINANCIAL CORPORATION
Greyhound Financial Corporation, a Delaware corporation (the "Company"), is
in the business of providing collateralized financing in focused market niches
primarily in the United States. The Company extends revolving credit facilities,
term loans and equipment and real estate financing to "middle-market" businesses
with financing needs falling generally between $500,000 and $35 million. The
Company also offers financing programs to manufacturers, distributors, vendors
and franchisors which facilitate the sale in the United States of their products
to end-users. The Company currently operates in 15 specific industry or market
niches in which its expertise in evaluating the creditworthiness of prospective
customers and its ability to provide value-added services enables the Company to
differentiate itself from its competitors and to command loan pricing which
provides a satisfactory spread over the Company's borrowing costs.
The Company seeks to maintain a high quality portfolio and to minimize
nonearning assets and write-offs by using clearly defined underwriting criteria,
stringent portfolio management techniques and by diversifying its lending
activities geographically and among a range of industries, customers and loan
products. Because of the diversity of the Company's portfolio, the Company
believes it is better able to manage competitive changes in its markets and to
withstand the impact of deteriorating economic conditions on a regional or
national basis.
Effective February 1, 1995, the name of the Company will be "FINOVA Capital
Corporation."
The Company's activities include:
GFC BUSINESS SEGMENTS
- 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. The Transportation Finance group 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. 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., 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 middle-market businesses including
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<PAGE> 13
manufacturers, wholesalers and distributors. The 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 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
Ambassador Factors Corporation, formerly known as Fleet Factors Corp.
("Ambassador Factors"), from Fleet Financial Group, Inc. Ambassador
Factors was merged into the Company in December 1994. Ambassador Factors
provides accounts receivable factoring and asset-based lending in amounts
generally ranging from $500,000 to $3 million, principally to small and
medium-sized textile and apparel manufacturers and importers.
TRICON BUSINESS SEGMENTS
On April 30, 1994, the Company acquired TriCon Capital Corporation
("TriCon"), formerly an indirect wholly-owned subsidiary of Bell Atlantic
Corporation. TriCon was merged into the Company in May 1994. TriCon is a niche
oriented provider of commercial finance and equipment leasing services to a
segmented group of borrowers and lessees throughout the United States. TriCon
conducts its operations through seven specialized business groups which provide
financial products and services to three specific market sectors of the
commercial finance industry; the End-User Sector, the Program Finance Sector and
the Capital Services Sector.
END-USER SECTOR. The customers in the End-User Sector use the assets which
TriCon finances or leases for the ongoing operations of their businesses. The
equipment which TriCon leases to its customers is typically purchased from an
equipment manufacturer, vendor or dealer selected by the customer. The three
specialized business groups associated with this market sector and the services
provided by TriCon to customers of each business group include:
- Medical Finance. Equipment and real estate financing and asset
management services targeting the top 2,400 health care providers in the
United States.
- Commercial Equipment Finance. Direct finance leasing of, and lending
for, general business equipment to quality commercial business
enterprises which lack ready access to the public finance markets.
- Government Finance. Primarily tax-exempt financing to state and local
governments. Due to tax benefit limitations, TriCon sells a substantial
portion of the tax-exempt assets generated by the Government Finance
group through syndications or securitizations to third parties. In
addition, TriCon has generated fee income by arranging for the sale or
originations of such assets through public offerings.
PROGRAM FINANCE SECTOR. TriCon's business groups in the Program Finance
Sector provide financing programs to help manufacturers, distributors, vendors
and franchisors facilitate the sale of their products or services. The three
specialized business groups associated with this market sector and the services
provided by TriCon to customers of each business group include:
- Vendor Services. Point-of-sale financing programs and support services
for regional and national manufacturers, distributors and vendors of
equipment classified as "small ticket" in transaction size (generally
transactions with an equipment cost of less than $250,000). The equipment
which TriCon leases to the ultimate end-user is typically sold to TriCon
by the vendor participating in the financing program.
- Franchise Finance. Equipment and total facility financing programs for
the franchise-based food service industry. The equipment which TriCon
leases to the ultimate end-user is typically purchased by TriCon from an
equipment manufacturer, vendor or dealer selected by the end-user.
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<PAGE> 14
- Commercial Credit Services. Accounts receivable and inventory lending
for manufacturers and major distributors, manufacturer-sponsored
inventory financing for office equipment dealers and telecommunications
receivables financing for regional providers of long distance operator
services.
CAPITAL SERVICES SECTOR. The Capital Services Sector has one business
group which focuses on the management and origination of highly structured
financing of "large ticket" commercial equipment (generally transactions
involving the sale or lease of equipment with a cost in excess of $15 million),
primarily leveraged leases for major corporations. The equipment which TriCon
leases to its customers is typically purchased from an equipment manufacturer,
vendor or dealer selected by the customer.
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
Corporation ("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. Effective February 1, 1995, the name of GFC
Financial will be "The FINOVA Group Inc."
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 and the nine months ended
September 30, 1994.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
NINE MONTHS ENDED ----------------------------------------
SEPTEMBER 30, 1994 1993 1992 1991 1990 1989
- ------------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
1.56 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, income to cover fixed charges was
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
$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.
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
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<PAGE> 15
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 $1,000,000,000
aggregate principal amount. Prior to the date of this Prospectus, the Company
has issued $177,550,000 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;
(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.
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<PAGE> 16
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, 1850 N. Central Avenue, Phoenix, Arizona 85004 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 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
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<PAGE> 17
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.
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,
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<PAGE> 18
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 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
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<PAGE> 19
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).
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
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<PAGE> 20
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.
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.
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<PAGE> 21
LEGAL MATTERS
The legality of the Securities being offered hereby will be passed upon for
the Company by William J. Hallinan, Esq., General Counsel to the Company. Brown
& Wood will act as counsel for any underwriters or agents.
EXPERTS
The financial statements of the Company incorporated in this Prospectus by
reference from the Company's Annual Report on Form 10-K for the year ended
December 31, 1993 have been audited by Deloitte & Touche LLP, independent
auditors, as stated in their report, which is incorporated herein by reference,
and have been so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
The consolidated balance sheets as of December 31, 1993 and 1992 and the
consolidated statements of income and cash flows for each of the three years in
the period ended December 31, 1993 of TriCon Capital Corporation-Predecessor
Business incorporated by reference in this prospectus, have been incorporated
herein in reliance on the report, which includes an explanatory paragraph for
certain accounting changes, of Coopers & Lybrand L.L.P., independent certified
public 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. at the time of their report) 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 LLP, independent auditors, given
upon the authority of said firm as experts in accounting and auditing.
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______________________________________________________
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE UNDERWRITER. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF THE COMPANY SINCE SUCH DATE.
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TABLE OF CONTENTS
PAGE
----
PROSPECTUS SUPPLEMENT
Greyhound Financial Corporation........ S-2
Ratio of Income to Fixed Charges....... S-4
Use of Proceeds........................ S-5
Description of Notes................... S-5
Underwriting........................... S-8
Notice to Canadian Residents........... S-8
PROSPECTUS
Available Information.................. 2
Incorporation of Certain Documents by
Reference............................ 2
Greyhound Financial Corporation ....... 3
Ratio of Income to Fixed Charges....... 5
Use of Proceeds........................ 5
Description of Securities.............. 5
Plan of Distribution................... 11
Legal Matters.......................... 12
Experts................................ 12
______________________________________________________
_______________________________________________________
G F C
GREYHOUND
FINANCIAL
CORPORATION
$125,000,000
8% Notes Due January 15, 1997
PROSPECTUS SUPPLEMENT
CS FIRST BOSTON
_____________________________________________________
