SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): May 25, 2000
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SOURCE CAPITAL CORPORATION
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(Exact name of registrant as specified in its charter)
Washington 0-12199 91-0853890
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(State or other (Commission (IRS Employer
Jurisdiction File Number) Identification No.)
of incorporation)
1825 N. Hutchinson Rd., Spokane, Washington (Zip Code)
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Registrant's telephone number, including area code: (509) 928-0908
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ITEM 5. OTHER EVENTS
[A] Annual Stockholders Meeting. At the annual stockholders
meeting of Source Capital Corporation (the "Company"), held on
May 25, 2000 the following matters were submitted to the vote
of the Company's shareholders.
(a) Proposal (1) Election of Directors. Class III
directors Clarence H. Barnes, Robert E. Lee and D.
Michael Jones were reelected to the Board for a term
which expires at the annual meeting of stockholders
in 2003.
(b) Proposal (2) Ratification of Auditors. The
re-appointment of BDO Seidman, LLP as auditors for
the year 2000 was ratified.
(c) Voting. The results of voting on the election of
directors and the ratification of auditors were as
follows:
Election of Directors:
<TABLE>
<CAPTION>
<S> <C> <C>
D. Michael Jones 958,779 shares voted For
50,683 shares withheld authority to vote
Robert E. Lee 958,779 shares voted For
50,683 shares withheld authority to vote
Clarence A. Barnes 958,779 shares voted For
50,683 shares withheld authority to vote
Ratification of
Auditors 949,308 shares voted For
44,368 shares voted Against
15,786 shares Abstained
</TABLE>
[B] Line-Of-Credit-Renewals.
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1. The Company's line of credit to fund real estate
lending activities was renewed in the amount of
$45,000,000, with a new note maturity date of April
30, 2001. The Company's real estate loans serve as
collateral for this line-of-credit to the extent they
are not more than 90 days past due, are on an accrual
basis, and are not more than 60 days past due as to
maturity. Loans in excess of $1,500,000 or that are
out of the Company's general service area require
specific approval by the lending banks in order to be
included in the collateral pool.
The real estate line of credit also requires the
Company to maintain minimum liquidity of $250,000 and
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net worth of at least $18,000,000. In the net worth
computation the Company's convertible subordinated
debentures, in the present outstanding amount of
$5,500,000.00 are counted as equity. The real estate
line-of-credit usage is limited to not exceed a ratio
of 3.25 to 1 of borrowings to net worth as modified
in the previous sentence.
2. The Company's leasing subsidiary's line-of-credit to
fund leases was extended 90 days on May 1, 2000 to
allow time for the annual Bank of America audit
review prior to renewal. The Company expects the line
will be renewed on or before the expiration of the
extension.
[C] Loan Concentrations.
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The following is a list of loan concentrations in excess of
$1,500,000 to individual borrowers as of May 31, 2000:
<TABLE>
<CAPTION>
Collateral Collateral Amount Interest
Location Type of loan Rate
-------- ---- ------- ----
<S> <C> <C> <C>
Western Washington Land and Timber $2,641,000(1) 13.50% Var.
Western Washington Land under development $1,614,000 13.50% Var.
Western Oregon Land and Condominiums $3,690,000 13.50% Var.
Southern California Distillery $2,000,000 13.50% Var.
Southern California Office Complex $1,500,000 13.50% Var.
Southern California Shopping Center $3,680,000(2) 11.21% Var.
Southern California Condominiums $2,977,000 13.50% Var.
</TABLE>
(1) Total concentration is comprised of nine separate
loans with separate collateral, to entities in which
an adult son of Alvin J. Wolff, Jr., the Chairman of
the Board of the Company, holds an equity interest of
ten percent or more.
(2) In 1996, the Company sold a shopping center (which
carried a first mortgage) on a wrapped contract. The
Company remains contingently liable on the first
mortgage in the amount of $3,087,000 which carries an
interest rate of 9.97% variable. The rate on the loan
receivable is adjusted semi-annually and the rate on
the mortgage payable is adjusted quarterly.
[D] Leasing Operations. Ronald Schutz, formerly President of the
Company' wholly owned leasing subsidiary, is no longer an
employee or otherwise affiliated with the Company.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Source Capital Corporation
(Registrant)
Date June 27, 2000 /s/ Lester L. Clark
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Lester L. Clark, Vice President, Treasurer
and Secretary (Principal Accounting and
Financial Officer)
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