UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE
13D-1(A) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13D-2(A)*
(AMENDMENT NO. 3)
Dynex Capital, Inc.
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(Name of Issuer)
Common Stock, $0.01 par value per share
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(Title of Class of Securities)
26817Q506
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(CUSIP Number)
with a copy to:
Michael R. Kelly Stephen Fraidin
550 West C Street Fried, Frank, Harris, Shriver & Jacobson
San Diego, CA 92101 One New York Plaza
(619) 687-5000 New York, NY 10004-1980
(212) 859-8000
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
October 3, 2000
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(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 which 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
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, as amended ("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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SCHEDULE 13D
CUSIP No. 26817Q506
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CALIFORNIA INVESTMENT FUND, LLC 33-0688954
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [x]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS (See Instructions)
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
NOT APPLICABLE
6 CITIZENSHIP OR PLACE OF ORGANIZATION
CALIFORNIA
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 572,178
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH
10 SHARED DISPOSITIVE POWER
572,178
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
572,178
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES (See Instructions)
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.00%
14 TYPE OF REPORTING PERSON (See Instructions)
CO
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SCHEDULE 13D
CUSIP No. 26817Q506
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MICHAEL R. KELLY
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [x]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS (See Instructions)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
NOT APPLICABLE
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 572,178
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH
10 SHARED DISPOSITIVE POWER
572,178
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
572,178
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES (See Instructions)
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.00%
14 TYPE OF REPORTING PERSON (See Instructions)
IN
<PAGE>
SCHEDULE 13D
CUSIP No. 26817Q506
1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RICHARD KELLY
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [x]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS (See Instructions)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
NOT APPLICABLE
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 572,178
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH
10 SHARED DISPOSITIVE POWER
572,178
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
572,178
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES (See Instructions)
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.00%
14 TYPE OF REPORTING PERSON (See Instructions)
IN
<PAGE>
This amendment amends and supplements Schedule 13D, of California
Investment Fund, LLC, dated March 29, 2000, and filed on April 4, 2000 with
the Securities and Exchange Commission ("SEC"), Amendment No. 1 to Schedule
13D, dated September 13, 2000 and filed on September 13, 2000 with the SEC,
and Amendment No. 2 to Schedule 13D, dated September 29, 2000, and filed on
October 3, 2000 (together, the "Schedule 13D"). Except as amended by this
amendment, there has been no change in the information previously reported
on the Schedule 13D.
ITEM 4. PURPOSE OF TRANSACTION.
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On September 29, 2000, California Investment Fund, LLC (the
"Fund") and Dynex Capital, Inc. ("Dynex") entered into a letter of intent
(the "Letter of Intent") regarding the Fund's proposed acquisition of Dynex
for $90 million through a reverse triangular merger of a wholly-owned
subsidiary of the Fund with and into Dynex. A copy of the Letter of Intent
was attached as an Exhibit to the Fund's Amendment No. 2 to Schedule 13D
filed on October 3, 2000, and is specifically incorporated herein by
reference, and the description herein of such letter is qualified in its
entirety by reference to such letter.
Subsequent to entering into the Letter of Intent, the Fund and
Dynex have continued to hold discussions regarding a potential merger
transaction and are negotiating the form of a proposed definitive merger
agreement. As of the date of this filing, Dynex has not approved the form
or terms of a definitive merger agreement.
On October 3, 2000, the Fund delivered to Dynex an initial draft
of a proposed merger agreement, which draft has been superceded by a
subsequent draft of a proposed merger agreement that the Fund delivered to
Dynex on October 15, 2000 (the "Draft Merger Agreement"). A copy of the
Draft Merger Agreement is attached hereto as Exhibit A and is specifically
incorporated herein by reference, and the description herein of such draft
agreement is qualified in its entirety by reference to such draft
agreement. As set forth above, the form of the Draft Merger Agreement has
not been agreed to by Dynex and is the proposal of the Fund. As such, the
Draft Merger Agreement remains subject to negotiation between the Fund and
Dynex. There can be no assurance that the Fund and Dynex will reach an
agreement regarding a potential merger transaction on the terms set forth
in the Draft Merger Agreement or otherwise. Except as provided in the
Letter of Intent, no binding obligation between the Fund and Dynex will
arise with respect to the potential merger transaction except as set forth
in a definitive merger agreement executed between the Fund and Dynex.
Discussions between the Fund and Dynex regarding a potential
merger transaction and the negotiation of a definitive merger agreement are
expected to continue to take place from time to time. There can be no
assurance that Dynex will approve a merger transaction.
Depending on the outcome of the discussions between Dynex and the
Fund, the Fund reserves the right to formulate other plans and/or make
other proposals, and take such actions with respect to its investment in
Dynex, including any or all of the actions set forth in paragraphs (a)
through (j) of Item 4 of Schedule 13D and any other actions as it may
determine. The Fund also reserves the right to suspend or terminate its
discussions with Dynex at any time.
Except as stated in this response to Item 4 and in furtherance of
a proposed business combination, the Fund has no current plans or proposals
with respect to Dynex or its securities of the types enumerated in
paragraphs (a) through (j) of Item 4 of Schedule 13D.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
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Exhibit A -- Draft Merger Agreement between the Fund, an acquisition
subsidiary of the Fund and Dynex, delivered by the Fund to
Dynex on October 15, 2000
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of our knowledge and
belief, we certify that the information set forth in this statement is
true, complete and correct.
Date: October 17, 2000 California Investment Fund, LLC,
a California limited liability company
By: /s/ Michael R. Kelly
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Michael R. Kelly
Its: Managing Member
Date: October 17,2000 Michael R. Kelly
By: /s/ Michael R. Kelly
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Michael R. Kelly, as an Individual
Date: October 17,2000 Richard Kelly
By: /s/ Richard Kelly
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Richard Kelly, as an Individual
<PAGE>
EXHIBIT INDEX
Exhibit A -- Draft Merger Agreement between the Fund, an acquisition
subsidiary of the Fund and Dynex, delivered by the Fund to
Dynex on October 15, 2000
