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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
Dynex Capital, Inc.
(Name of Issuer)
Common Stock, $0.01 par value per share
(Title of Class Securities)
26817Q506
(CUSIP Number)
Ernest C. Garcia II
2525 E. Camelback Road, Suite 1150
Phoenix, Arizona 85016
(602) 522-3200
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 24, 1999
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box. / /
Note: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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COVER PAGES
CUSIP NO. 26817Q506 13D, Amendment No. 1 PAGE __2__ OF __4__ PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Verde Reinsurance Company, Ltd.
66-0558988
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Island of Nevis
NUMBER OF 7 SOLE VOTING POWER 0
SHARES
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER 561,600
EACH
REPORTING
PERSON WITH 9 SOLE DISPOSITIVE POWER 0
10 SHARED DISPOSITIVE POWER 561,600
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON 561,600
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.9%
14 TYPE OF REPORTING PERSON*
CO
* See Instructions
2
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CUSIP NO. 26817Q506 13D, Amendment No. 1 PAGE __3__ OF __4__ PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Verde Investments, Inc.
86-0706842
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
ARIZONA
NUMBER OF 7 SOLE VOTING POWER 0
SHARES
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER 152,200
EACH
REPORTING
PERSON WITH 9 SOLE DISPOSITIVE POWER 0
10 SHARED DISPOSITIVE POWER 152,200
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON 152,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.3%
14 TYPE OF REPORTING PERSON*
CO
* See Instructions
3
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CUSIP NO. 26817Q506 13D, Amendment No. 1 PAGE __4__ OF __4__ PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Ernest C. Garcia II
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF 7 SOLE VOTING POWER 0
SHARES
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER 713,800
EACH
REPORTING
PERSON WITH 9 SOLE DISPOSITIVE POWER 0
10 SHARED DISPOSITIVE POWER 713,800
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON 713,800
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.23%
14 TYPE OF REPORTING PERSON*
IN
* See Instructions
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ITEM 1.
SECURITY AND ISSUER.
<TABLE>
<S> <C>
Title of Class of
Equity Security: Common Stock, $0.01 par value per share
Name of Issuer: Dynex Capital, Inc. ("Dynex")
Address of 10900 Nuckols Road, 3rd Floor
Principal Office: Glen Allen, Virginia 23060
</TABLE>
ITEM 2. IDENTITY AND BACKGROUND.
(a) NAME OF PERSON FILING:
A. Verde Reinsurance Company, Ltd., a corporation of the Island of Nevis
("Verde Reinsurance")
B. Verde Investments, Inc., an Arizona corporation ("Verde Investments")
C. Ernest C. Garcia II ("Garcia") (Verde Reinsurance, Verde Investments
and Garcia collectively, the "Reporting Persons")
This Schedule 13D, Amendment No. 1 is jointly filed pursuant to Rule 13d-1(k)(1)
promulgated by the Securities and Exchange Commission ("SEC") under Section
13(d) of the Securities Exchange Act of 1934, as amended (the "Act") by: (i)
Verde Reinsurance, by virtue of its direct beneficial ownership of Common Stock
of Dynex; (ii) Verde Investments, by virtue of its direct beneficial ownership
of Common Stock of Dynex and indirect beneficial ownership by virtue of its
ownership of convertible preferred stock of Dynex, and (iii) Garcia, by virtue
of his indirect beneficial ownership of Common Stock of Dynex via his sole
ownership of all of the common stock of Verde Reinsurance and Verde Investments.
This Schedule 13D, Amendment No. 1 is being filed to reflect the fact that since
the filing of the original Schedule 13D, the Reporting Persons have acquired
beneficial ownership of an additional 1% of the outstanding common stock of
Dynex.
Certain information required by this Item 2 concerning the directors and
executive officers of Verde Reinsurance and Verde Investments is set forth on
Schedule 1 attached hereto, which is incorporated herein by reference.
The Reporting Persons may be deemed to constitute a "group" for purposes of
Section 13(d)(3) of the Act.
(b) RESIDENCE OR BUSINESS ADDRESS:
No change from original Schedule 13D.
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(c) PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL
BUSINESS AND ADDRESS OF CORPORATION IN WHICH EMPLOYMENT IS CONDUCTED:
No change from original Schedule 13D.
(d) WHETHER DURING THE LAST FIVE YEARS, SUCH PERSON HAS BEEN CONVICTED IN A
CRIMINAL PROCEEDING (EXCLUDING TRAFFIC VIOLATIONS OR SIMILAR
MISDEMEANORS) AND, IF SO, GIVE THE DATES, NATURE OF CONVICTION, NAME
AND LOCATION OF COURT, ANY PENALTY IMPOSED, OR OTHER DISPOSITION OF THE
CASE:
No change from original Schedule 13D.
(e) WHETHER DURING THE LAST FIVE YEARS, SUCH PERSON WAS A PARTY TO A CIVIL
PROCEEDING OF A JUDICIAL OR ADMINISTRATIVE BODY OF COMPETENT
JURISDICTION AND AS A RESULT OF SUCH PROCEEDING WAS OR IS SUBJECT TO A
JUDGMENT, DECREE OR FINAL ORDER ENJOINING FUTURE VIOLATIONS OF, OR
PROHIBITING OR MANDATING ACTIVITIES SUBJECT TO, FEDERAL OR STATE
SECURITIES LAWS OR FINDING ANY VIOLATION WITH RESPECT TO SUCH LAWS;
AND, IF SO, IDENTIFY AND DESCRIBE SUCH PROCEEDINGS AND SUMMARIZE THE
TERMS OF SUCH JUDGMENT, DECREE OR FINAL ORDER:
No change from original Schedule 13D.
(f) CITIZENSHIP:
No change from original Schedule 13D.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
To date, working capital of Verde Reinsurance and Verde Investments has been
used to purchase the Dynex securities at an approximate total cost (with
commissions and fees) of $3,615,881 and $1,555,571, respectively. No borrowings
or other types of consideration other than cash has been used to date for these
purchases. If and when future purchases of Dynex securities are made, the
Reporting Persons may use a variety of sources of funds; however, the Reporting
Persons have no present plan, arrangement, or understanding in connection with
sources of funds for future purchases of the securities.
ITEM 4. PURPOSE OF TRANSACTION.
No change from original Schedule 13D.
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ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) AGGREGATE NUMBER AND PERCENTAGE OF SECURITIES BENEFICIALLY OWNED:
Verde Reinsurance is the direct beneficial owner of 561,600 shares of
Common Stock, representing approximately 4.9% of Dynex's Common Stock,
which amount includes 8,350 shares of Common Stock that may be acquired
by Verde Reinsurance upon the conversion of shares of preferred stock
of Dynex held by Verde Reinsurance. Verde Investments is the direct
beneficial owner of 152,200 shares of Common Stock, representing
approximately 1.3% of Dynex's Common Stock. Mr. Garcia is the indirect
beneficial owner of 713,800 shares of Common Stock owned by Verde
Reinsurance and Verde Investments, representing approximately 6.23% of
Dynex's Common Stock, which amount includes 8,350 shares of Common
Stock, that may be acquired by Verde Reinsurance upon the conversion of
shares of preferred stock of Dynex held by Verde Reinsurance. By virtue
of the relationship between Mr. Garcia and Verde Reinsurance and Verde
Investments described in Item 2, Mr. Garcia may be deemed to possess
indirect beneficial ownership of the shares of Common Stock
beneficially owned by Verde Reinsurance and Verde Investments.
Ownership percentages of Common Stock is based upon the common shares
outstanding per Dynex's Form 10-Q Report for the Quarter ended
September 30, 1999 (11,443,840 shares of Common Stock outstanding at
September 30, 1999, reflecting a one-for-four reverse Common Stock
split effective August 2, 1999), plus the 8,350 shares of Common Stock
into which the Dynex preferred stock held by Verde Reinsurance is
convertible.
(b) NUMBER OF SHARES AS TO WHICH SUCH PERSON HAS VOTING AND DISPOSITIVE
POWER:
A. Verde Reinsurance:
(i) Sole power to vote or to direct the vote -- 0
(ii) Shared power to vote or to direct the vote - 561,600
(iii) Sole power to dispose or to direct the disposition -- 0
(iv) Shared power to dispose or to direct the disposition - 561,600
B. Verde Investments:
(i) Sole power to vote or to direct the vote -- 0
(ii) Shared power to vote or to direct the vote - 152,200
(iii) Sole power to dispose or to direct the disposition -- 0
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(iv) Shared power to dispose or to direct the disposition - 152,200
C. Ernest C. Garcia II
(i) Sole power to vote or to direct the vote -- 0
(ii) Shared power to vote or to direct the vote - 713,800
(iii) Sole power to dispose or to direct the disposition -- 0
(iv) Shared power to dispose or to direct the disposition - 713,800
(c) TRANSACTIONS EFFECTED DURING THE PAST 60 DAYS OR SINCE THE MOST RECENT
FILING ON SCHEDULE 13D, WHICHEVER IS LESS:
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<CAPTION>
- ------------------------------------- ------------------------- ------------------------------- ---------------------
REPORTING PERSON DATE OF AMOUNT OF PRICE PER
PURCHASE SECURITIES SHARE ($)
PURCHASED (#)
- ------------------------------------- ------------------------- ------------------------------- ---------------------
<S> <C> <C> <C>
Verde Reinsurance Company, Ltd. 11/1/99 8,000 6.25
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/2/99 3,400 6.25
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/3/99 1,000 6.25
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/4/99 2,700 6.3125
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/5/99 16,200 6.2407
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/8/99 2,000 6.00
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/16/99 20,000 7.1094
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/17/99 11,900 6.75
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/18/99 14,200 6.6945
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/19/99 8,500 6.6750
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/22/99 5,400 6.7310
- ------------------------------------- ------------------------- ------------------------------- ---------------------
</TABLE>
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<TABLE>
<CAPTION>
- ------------------------------------- ------------------------- ------------------------------- ---------------------
REPORTING PERSON DATE OF AMOUNT OF PRICE PER
PURCHASE SECURITIES SHARE ($)
PURCHASED (#)
- ------------------------------------- ------------------------- ------------------------------- ---------------------
<S> <C> <C> <C>
Verde Reinsurance Company, Ltd. 11/23/99 17,700 6.7309
- ------------------------------------- ------------------------- ------------------------------- ---------------------
Verde Reinsurance Company, Ltd. 11/24/99 9,900 6.6673
- ------------------------------------- ------------------------- ------------------------------- ---------------------
</TABLE>
(d) NO OTHER PERSON IS KNOWN TO HAVE THE RIGHT TO RECEIVE OR THE POWER TO
DIRECT THE RECEIPT OF DIVIDENDS FROM, OR THE PROCEEDS FROM THE SALE OF,
SUCH SECURITIES.
(e) NOT APPLICABLE.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
No change from original Schedule 13D.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 99.1: Agreement re Joint Filing of Schedule 13D, Amendment No. 1
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
<TABLE>
<S> <C>
Dated: November 30, 1999 VERDE REINSURANCE COMPANY, LTD., a
corporation of the Island of Nevis
By: /s/Ernest C. Garcia II
-------------------------------
Ernest C. Garcia II
Its: President
Dated: November 30, 1999 VERDE INVESTMENTS, INC., an Arizona
corporation
By: /s/Ernest C. Garcia II
-------------------------------
Ernest C. Garcia II
Its: President
Dated: November 30, 1999 ERNEST C. GARCIA II
By: /s/Ernest C. Garcia II
-------------------------------
Ernest C. Garcia II, as an Individual
</TABLE>
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SCHEDULE 1 TO SCHEDULE 13D
EXECUTIVE OFFICERS AND DIRECTORS
INFORMATION FOR VERDE REINSURANCE COMPANY, LTD.
No change from original Schedule 13D.
EXECUTIVE OFFICERS AND DIRECTORS
INFORMATION FOR VERDE INVESTMENTS, INC.
No change from original Schedule 13D.
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
<S> <C>
Exhibit 99.1: Agreement re Joint Filing of Schedule 13D, Amendment No. 1
</TABLE>
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EXHIBIT 99.1
AGREEMENT RE JOINT FILING OF SCHEDULE 13D, AMENDMENT NO. 1
Each of the undersigned hereby agrees:
1. Each of them is individually eligible to use the Schedule 13D,
Amendment No. 1 to which this Exhibit is attached, and such Schedule 13D,
Amendment No. 1 is filed on behalf of each of them; and
2. Each of them is responsible for the timely filing of such Schedule
13D, Amendment No. 1 and any further amendments thereto, and for the
completeness and accuracy of the information concerning such person contained
therein; but none of them is responsible for the completeness or accuracy of the
information concerning the other persons making the filing, unless such person
knows or has reason to believe that such information is inaccurate.
<TABLE>
<CAPTION>
<S> <C>
Dated: November 30, 1999 VERDE REINSURANCE COMPANY, LTD., a
corporation of the Island of Nevis
By: /s/Ernest C. Garcia II
-------------------------------------
Ernest C. Garcia II
Its: President
Dated: November 30, 1999 VERDE INVESTMENTS, INC., an Arizona corporation
By: /s/Ernest C. Garcia II
-------------------------------------
Ernest C. Garcia II
Its: President
Dated: November 30, 1999 ERNEST C. GARCIA II
By: /s/Ernest C. Garcia II
-------------------------------------
Ernest C. Garcia II, as an Individual
</TABLE>
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