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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 1, 1996
OLYMPIC FINANCIAL LTD.
(Exact name of registrant as specified in charter)
Minnesota 0-20526 41-1664848
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
7825 Washington Avenue South, Minneapolis, MN 55439-2435
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(612) 942-9880
[Not Applicable]
(Former name or former address, if changed from last report)
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Item 5. Other Events
Adoption of Stockholder Rights Plan
On October 28, 1996, the Board of Directors of Olympic Financial Ltd.
(the "Company") declared a dividend distribution of one Right for each
outstanding share of the Company's common stock, par value $.01 per share (the
"Common Stock"), payable to shareholders of record at the close of business on
November 22, 1996 (the "Record Date") and with respect to the Common Stock
issued thereafter until the Distribution Date (defined below) and, in certain
circumstances, with respect to the Common Stock issued after the Distribution
Date. Each Right, when it becomes exercisable, generally entitles the registered
holder to purchase from the Company a unit consisting initially of one
one-thousandth of a share (a "Unit") of Class A Preferred Stock, par value $.01
per share (the "Preferred Stock"), of the Company, at a Purchase Price of $90.00
per Unit, subject to adjustment (the "Purchase Price"). The description and
terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement"), dated as of November 1, 1996, between the Company and Norwest Bank
Minnesota, N.A., as Rights Agent.
Initially, the Rights will be attached to all certificates representing
shares of Common Stock then outstanding, and no separate certificates evidencing
the Rights ("Rights Certificates") will be distributed. The Rights will separate
from the Common Stock and a Distribution Date will occur upon the earlier of (i)
ten (10) days (or such later date as the Board of Directors shall determine)
following public disclosure that a person or group of affiliated or associated
persons has become an "Acquiring Person" (as defined below), or (ii) ten (10)
business days (or such later date as the Board shall determine) following the
commencement of a tender offer or exchange offer that would result in a person
or group becoming an "Acquiring Person". Except as set forth below, an
"Acquiring Person" is a person or group of affiliated or associated persons who
has acquired beneficial ownership of 15% or more of the outstanding shares of
Common Stock. The term "Acquiring Person" excludes (i) the Company, (ii) any
subsidiary of the Company, (iii) any employee benefit plan of the Company or any
subsidiary of the Company, (iv) any person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan, and
(v) any person holding Common Stock issued to that person by the Company in a
transaction approved in advance by a majority of the Continuing Directors of the
Company to the extent and only to the extent so approved.
Until the occurrence of the Distribution Date, (i) the Rights will be
evidenced by the Common Stock certificates and will be transferred with and only
with such Common Stock certificates, (ii) new Common Stock certificates issued
after the Record Date will contain a notation incorporating the Rights
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Agreement by reference, and (iii) the surrender for transfer of any
certificates for Common Stock outstanding will also constitute the transfer of
the Rights associated with the Common Stock represented by such certificate.
Pursuant to the Rights Agreement, the Company reserves the right to require
prior to the occurrence of a Triggering Event (as defined below) that, upon any
exercise of Rights, a number of Rights be exercised so that only whole shares of
Preferred Stock will be issued.
As soon as practicable after the occurrence of the Distribution Date,
Rights Certificates will be mailed to holders of record of the Common Stock as
of the close of business on the Distribution Date and, thereafter, the separate
Rights Certificates alone will represent the Rights. Except in certain
circumstances specified in the Rights Agreement or as otherwise determined by
the Board of Directors, only shares of Common Stock issued prior to the
Distribution Date will be issued with Rights.
The Rights are not exercisable until the occurrence of the Distribution
Date and until the Rights no longer are redeemable. The Rights will expire at
the close of business on October 28, 2006, unless extended or earlier redeemed
by the Company as described below.
In the event that, at any time following the Distribution Date, a
person becomes an Acquiring Person, each holder of a Right will thereafter have
the right to receive, upon exercise of the Right, Common Stock (or, in certain
circumstances, cash, property or other securities of the Company) having a value
equal to two times the exercise price of the Right. Notwithstanding any of the
foregoing, following the occurrence of the event set forth in this paragraph,
all Rights that are, or (under certain circumstances specified in the Rights
Agreement) were, beneficially owned by any Acquiring Person will be null and
void and nontransferable and any holder of any such right (including any
purported transferee or subsequent holder) will be unable to exercise or
transfer any such right. For example, at an exercise price of $30 per Right,
each Right not owned by an Acquiring Person (or by certain related parties)
following an event set forth in the preceding paragraph would entitle its holder
to purchase $60 worth of Common Stock (or other consideration, as noted above)
for $30. Assuming that the Common Stock had a per share value of $10 at such
time, the holder of each valid Right would be entitled to purchase 6 (six)
shares of Common Stock for $30.
In the event that, at any time following the date on which there has
been public disclosure that, or of facts indicating that, a person has become an
Acquiring Person (the "Stock Acquisition Date"), (i) the Company is acquired in
a merger or other business combination transaction in which the Company is not
the surviving corporation, or (ii) 50% or more of the Company's assets or
earning power is sold, mortgaged or
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transferred, each holder of a Right (except Rights which previously
have been voided as set forth above) shall thereafter have the right to receive,
upon exercise, common stock of the acquiring company having a value equal to two
times the exercise price of the Right. The events set forth in this paragraph
and in the preceding paragraph are referred to as the "Triggering Events."
The Purchase Price payable, and the number of Units of Preferred Stock
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) if holders of the Preferred Stock are granted certain
rights or warrants to subscribe for Preferred Stock or convertible securities at
less than the current market price of the Preferred Stock, or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least 1% of the Purchase
Price. No fractional Units will be issued and, in lieu thereof, an adjustment in
cash will be made based on the market price of the Preferred Stock on the last
trading date prior to the date of exercise.
Because of the nature of the Preferred Stock's dividend, liquidation
and voting rights, the value of the one one-thousandth interest in a share of
Preferred Stock purchasable upon exercise of each Right should approximate the
value of one share of Common Stock. Shares of Preferred Stock purchasable upon
exercise of the Rights will not be redeemable. Each share of Preferred Stock
will be entitled to a quarterly dividend payment of 1000 times the dividend
declared per share of Common Stock. In the event of liquidation, each share of
Preferred Stock will be entitled to a $10.00 preference, and thereafter the
holders of the shares of Preferred Stock will be entitled to an aggregate
payment of 1000 times the aggregate payment made per share of Common Stock. Each
share of Preferred Stock will have 1000 votes, voting together with the shares
of Common Stock. These rights are protected by customary antidilution
provisions.
At any time until ten days following the Stock Acquisition Date, the
Company may redeem the Rights in whole, but not in part, at a price (the
"Redemption Price") of $.01 per Right (payable in cash, Common Stock or other
consideration deemed appropriate by the Board of Directors) by resolution of the
Board of Directors (provided that such resolution is approved by a majority of
the Continuing Directors and only if the Continuing Directors constitute a
majority of the directors then in office).
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A "Continuing Director" is a member of the Board of Directors as of the
Record Date and any successor to a Continuing Director if the successor was
recommended for election or elected to succeed the prior Continuing Director by
a majority of the Continuing Directors. The redemption of the Rights may be made
effective at such time on such basis with such conditions as the Board of
Directors in its sole discretion may establish. Immediately upon such action of
the Board of Directors ordering redemption of the Rights, the Rights will
terminate and the only right of the holders of Rights will be to receive the
Redemption Price.
At any time after the Rights become exercisable for Common Stock or
other consideration of the Company, the Board of Directors may exchange the
Rights, in whole or in part, at an exchange ratio of one share of Common Stock,
and/or equity securities deemed to have the same value as one share of Common
Stock, per Right, subject to adjustment.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not
be taxable to shareholders or to the Company, shareholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) of the Company or for
common stock of the acquiring company as set forth above.
Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by
resolution of the Company's Board of Directors (provided that such resolution is
approved by a majority of the Continuing Directors and only if the Continuing
Directors constitute a majority of the directors then in office) prior to the
Distribution Date. After the Distribution Date, the provisions of the Rights
Agreement may be amended by resolution of the Company's Board of Directors
(provided that such resolution is approved by a majority of the Continuing
Directors and only if the Continuing Directors constitute a majority of the
directors then in office) in order to cure any ambiguity, to make changes which
do not adversely affect the interests of holders of Rights (excluding the
interests of any Acquiring Person or its affiliates or associates), or to
shorten or lengthen any time period under the Rights Agreement; provided,
however, that no amendment to adjust the time period governing redemption shall
be made at such time as the Rights are not redeemable.
A copy of the Rights Agreement, which includes as Exhibit B the form of
Rights Certificate, is filed as an Exhibit hereto. A copy of the Rights
Agreement is available free of charge from the Company. This summary description
of the Rights does not purport to be complete and is qualified in its entirety
by reference to the Rights Agreement.
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Item 7. Financial Statements and Exhibits
(a) Financial Statements of businesses acquired: None.
(b) Pro Forma financial information: None.
(c) Exhibits:
4.1 Rights Agreement, dated as of November 1, 1996,
between Olympic Financial Ltd. and Norwest
Shareowner Services (incorporated by reference to
Exhibit 1 to the Olympic Financial Ltd.
registration statement on Form 8-A filed with the
Securities and Exchange Commission on November 6,
1996)
99.1 Press Release of Olympic Financial Ltd., dated
November 4, 1996, announcing Shareholder Rights
Plan.
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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.
OLYMPIC FINANCIAL LTD.
/s/ James D. Atkinson III
Name: James D. Atkinson III
Title: Vice President and
General Counsel
November 7, 1996
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EXHIBIT INDEX
Exhibit
- -------
99.1 Press Release of Olympic Financial Ltd., dated November 4, 1996,
announcing Shareholder Rights Plan.
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Olympic Financial Ltd
Investor Relations
1-800-711-4952
Facsimile (612) 944-2819
FOR IMMEDIATE RELEASE CONTACT:
John A. Witham,
Chief Financial Officer
(612) 942-9880
OLYMPIC FINANCIAL LTD.
ADOPTS SHAREHOLDER RIGHTS PLAN
Minneapolis, Minnesota, November 4, 1996. Olympic Financial Ltd. (NYSE: OLM)
announced today that its Board of Directors has adopted a Shareholder Rights
Plan in which preferred stock purchase Rights will be distributed as a
dividend at the rate of one Right for each share of the Company's Common Stock
held as of the close of business on November 22, 1996. The Rights will expire
on October 28, 2006.
The Rights are intended to enable all of the Company's shareholders to realize
the long-term value of their investment in the Company. The Rights will not
prevent a takeover, but should encourage anyone seeking to acquire the Company
to negotiate with the Board prior to attempting a takeover.
In a letter being sent to shareholders, Warren Kantor, Chairman of the Executive
Committee of Olympic Financial Ltd., said the Rights Plan is intended to protect
the interests of the Company's shareholders in the event the Company is
confronted with coercive or unfair takeover tactics. He noted that such tactics
include "offers that do not treat all shareholders equally, the acquisition in
the open market or otherwise of shares constituting control without offering
fair value to all shareholders, or other coercive or unfair takeover tactics
that could impair the Board's ability to represent shareholders' interests
fully."
Mr. Kantor stressed, however, that the Rights Plan "is not intended to prevent
an acquisition of the Company on terms that your Board considers favorable and
fair to, and in the best interest of, all shareholders, and will not do so. The
Rights Plans is designed to deal with the serious problem of unilateral actions
by hostile acquirers which are calculated to deprive the Company's Board of
Directors and its shareholders of their ability to determine the destiny of the
Company."
Olympic Financial Center, 7825 Washington Avenue South,
Minneapolis, MN 55439-2444
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OLYMPIC FINANCIAL LTD.
ADOPTS SHAREHOLDER RIGHTS PLAN
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Each Right generally will entitle shareholders, in certain circumstances, to buy
one-thousandth of a newly issued share of Class A Preferred Stock of the Company
at an exercise price of $90.00. The Rights generally will be exercisable and
transferable apart from Common Stock or commences a tender or exchange upon
consummation of which such person or group would beneficially own 15% of more of
the Common Stock.
If any person becomes the beneficial owner of 15% or more of the Company's
Common Stock, then each Right not owned by a 15% or more shareholder or certain
related parties will generally entitle its holders to purchase, at the Right's
then-current exercise price, shares of Common Stock (or, in certain
circumstances as determined by the Board, cash, other property or other
securities) having a value of twice the Right's exercise price. In addition, if,
after any person has become a 15% or more shareholder, the Company is involved
in a merger or other business combination transaction with another person in
which its Common Stock is changed or converted, or sells 50% or more of its
assets or earning power to another person, each Right will entitle its holder to
purchase, at the Right's then-current exercise price, shares of common stock of
such other person having a value twice the Right's exercise price.
The Company will generally be entitled to redeem the Rights at $.01 per Right at
any time until the tenth day following public disclosure that a person or group
has become the beneficial owner of 15% or more of the Company's Common Stock.
Details of the Shareholders Rights Plan are outlined in a summary of the Rights
Plan which will be mailed to shareholders.
Olympic Financial Ltd. is a Minneapolis-based consumer finance company which
purchases, sells and services prime retail installment contracts for new and
used automobiles originated by more than 7,000 dealers nationwide. Olympic is
the largest independent provider of automobile financing. The Company, which was
founded in 1990, has Regional Buying Centers in Arizona, Northern and Southern
California, Colorado, Florida, Georgia, Massachusetts, Minnesota, Missouri, New
York, North Carolina, Ohio, Tennessee, North, South and West Texas and
Washington. The Company acquires loans through 17 Regional Buying Centers and
has expanded its dealer network to include dealers in 38 states.
