Filed pursuant to Rule 424(b)(2)
File No. 333-75719
Prospectus [FINOVA LOGO]
211,379 Shares of Common Stock
The FINOVA Group Inc.
1850 N. Central Avenue
P. O. Box 2209
Phoenix, Arizona 85002-2209
(602) 207-6900
These shares may be offered for sale FINOVA is registering these shares as
from time to time by stockholders required by the Registration Rights
listed below in "Selling Agreement we signed with the Selling
Stockholders." They may sell their Stockholders when FINOVA acquired
shares at their discretion. As a Preferred Business Credit, Inc.
result, some or all of these shares ("PBC") by way of merger.
may not be sold by the Selling
Stockholders.
The Selling Stockholders, not FINOVA, FINOVA's common stock is quoted on the
will receive the proceeds from the New York Stock Exchange under the
sale of these shares. FINOVA will pay symbol "FNV." The closing price quoted
all of the expenses of the on the NYSE's composite tape was
registration of these shares, $50.75/share on June 4, 1999.
estimated to be $50,000.
The securities have not been approved The Selling Stockholders may offer the
or disapproved by the SEC or any securities directly or through
state securities commission. None of underwriters, agents or dealers. "Plan
those authorities has determined that of Distribution" below provides more
this prospectus is accurate or information on this topic.
complete. Any representation to the
contrary is a criminal offense.
June 9, 1999.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and * Annual Report on Form 10-K for
current reports, proxy and information the year ended December 31,
statements and other information with 1998 and all amendments thereto.
the SEC. You may read and copy any
document we file at the SEC's public * Portions of the Proxy Statement
reference rooms in Washington, D.C., on Schedule 14A for the Annual
New York, New York and Chicago, Meeting of Shareholders to be
Illinois. Please call the SEC at held on May 13, 1999 that have
1-800-SEC-0330 for more information on been incorporated by reference
the public reference rooms and their into our 10-K.
copy charges. Our SEC filings are also
available to the public from the SEC's * Quarterly Report on Form 10-Q
web site at http://www.sec.gov. You for the Quarter ended March 31,
may also inspect our SEC reports and 1999.
other information at the New York
Stock Exchange, 20 Broad Street, New * Current Reports on Form 8-K
York, New York 10005. dated January 14, March 22,
April 14 and May 6, 1999.
The SEC allows us to "incorporate
by reference" the information we file * The description of FINOVA's
with them, which means we can disclose capital stock contained in our
information to you by referring you to Registration Statement on Form
those documents. Information S-3 dated March 3, 1999.
incorporated by reference is part of
this prospectus. Later information We will provide you with a copy of
filed with the SEC updates and these filings, at no cost to you, upon
supersedes this prospectus. written or oral request directed to:
We incorporate by reference the Treasurer
documents listed below and any future The FINOVA Group Inc.
filings made with the SEC under 1850 North Central Avenue
Sections 13(a), 13(c), 14 or 15(d) of P.O. Box 2209
the Securities Exchange Act of 1934 Phoenix, Arizona 85002-2209
until this offering is completed: (602) 207-6900
FINOVA
The FINOVA Group Inc. ("FINOVA," enable us to command pricing that
"we" or "us") is a financial services provides satisfactory spread over our
holding company. Through our principal borrowing costs.
subsidiary, FINOVA Capital Corporation
("FINOVA Capital"), we provide a broad We seek to maintain a high quality
range of financing and capital market portfolio and to minimize non-earning
products. We concentrate on lending to assets and write-offs. We use clearly
midsize business. FINOVA Capital has defined underwriting criteria and
been in operation since 1954. stringent portfolio management
techniques. We diversify our lending
We extend revolving credit activities geographically and among a
facilities, term loans and equipment range of industries, customers and
and real estate financing primarily to loan products.
"middle-market" businesses with
financing needs falling generally Due to the diversity of our
between $100,000 and $35 million. We portfolio, we believe we are better
operate in 20 specific industry or able to manage competitive changes in
market niches under three market our markets and to withstand the
groups. We selected these niches impact of deteriorating economic
because our expertise in evaluating conditions on a regional or national
the creditworthiness of prospective basis. There can be no assurance,
customers and our ability to provide however, that competitive changes,
value-added services enables us to borrowers' performance, economic
differentiate ourselves from our conditions or other factors will not
competitors. That expertise and result in an adverse impact on our
ability also results of operations or financial
condition.
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We generate interest, leasing, fees * DISTRIBUTION AND CHANNEL FINANCE
and other income through charges (FORMERLY INVENTORY FINANCE)
assessed on outstanding loans, loan provides inbound and outbound
servicing, leasing, brokerage and inventory financing, combined
other activities. Our primary expenses inventory/accounts receivable
are the costs of funding the loan and lines of credit and purchase
lease business, including interest order financing for equipment
paid on debt, provisions for credit distributors, value-added
losses, marketing expenses, salaries resellers and dealers
and employee benefits, servicing and nationwide. Transaction sizes
other operating expenses and income generally range from $500,000 to
taxes. $30 million.
Our principal offices are located * GROWTH FINANCE provides
at 1850 North Central Avenue, P.O. Box collateral based working capital
2209, Phoenix, Arizona 85002-2209. Our financing primarily secured by
telephone number is (602) 207-6900. We accounts receivable. Typical
also have business development offices transaction sizes range from
throughout the U.S. and in London, $100,000 to $1 million and are
U.K. and Toronto, Canada. made to small and midsize
businesses with annual sales
BUSINESS GROUPS under $10 million.
We operate the following principal * REDISCOUNT FINANCE offers
lines of business under three market revolving credit facilities to
groups: the independent consumer finance
industry including sales,
COMMERCIAL FINANCE automobile, mortgage and premium
finance companies. Typical
* BUSINESS CREDIT offers transaction sizes range from $1
collateral-oriented revolving million to $35 million.
credit facilities and term loans
for manufacturers, distributors, SPECIALTY FINANCE
wholesalers and service
companies. Typical transaction * COMMERCIAL EQUIPMENT FINANCE
sizes range from $500,000 to $3 offers equipment leases, loans
million. and "turnkey" financing to a
broad range of midsize
* COMMERCIAL SERVICES (FORMERLY companies. Specialty markets
FACTORING SERVICES) offers full include the corporate aircraft
service factoring and accounts and emerging growth technology
receivable management services industries, primarily
for entrepreneurial and larger biotechnology and electronics.
firms, primarily in the textile Typical transaction sizes range
and apparel industries. The from $500,000 to $15 million.
annual factored volume of these
companies is generally between * COMMUNICATIONS FINANCE
$5 million and $25 million. This specializes in term financing to
line provides accounts advertising and
receivable financing and loans subscriber-supported businesses
secured by equipment and real including radio and television
estate. stations, cable operators,
outdoor advertising firms and
* CORPORATE FINANCE provides a publishers. Typical transaction
full range of cash flow-oriented sizes range from $1 million to
and asset-based term and $40 million.
revolving loan products for
manufacturers, wholesalers, * FRANCHISE FINANCE offers
distributors, specialty equipment, real estate and
retailers and commercial and
consumer service businesses.
Typical transaction sizes range
from $2 million to $35 million.
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acquisition financing for CAPITAL MARKETS
operators of established
franchise concepts. Transaction * REALTY CAPITAL specializes in
sizes generally range from providing capital markets-funded
$500,000 to $15 million. commercial real estate financing
products and commercial mortgage
* HEALTHCARE FINANCE offers a full banking services. Typical
range of working capital, transaction sizes range from $1
equipment and real estate million to $5 million.
financing products for the U.S.
healthcare industry. Transaction * INVESTMENT ALLIANCE provides
sizes typically range from equity and debt financing for
$500,000 to $25 million. midsize businesses in
partnership with institutional
* PORTFOLIO SERVICES provides investors and selected fund
customized receivable servicing sponsors. Typical transaction
and collections for timeshare sizes range from $1 million to
developers and other generators $15 million.
of consumer receivables.
* LOAN ADMINISTRATION provides
* PUBLIC FINANCE provides in-house servicing for FINOVA's
tax-exempt term financing to commercial loan products as well
state and local governments, as servicing and sub-servicing
non-profit corporations and of other mortgage and consumer
entities using industrial loans, including residential
revenue or development bonds. real estate, mobile homes,
Typical transaction sizes range automobiles and other consumer
from $100,000 to $5 million. products.
* RESORT FINANCE focuses on * MEZZANINE CAPITAL provides
construction, acquisition and senior and subordinated secured
receivables financing of term loans to small, fast
timeshare resorts worldwide, growing companies in a broad
second home communities and range of industries that are
fractional interest resorts. located in the U.S. and Canada
Typical transaction sizes range for expansions, acquisitions,
from $5 million to $35 million. buy-outs and other strategic
ventures. Typical transaction
* SPECIALTY REAL ESTATE FINANCE sizes range from $1 million to
provides senior term $5 million.
acquisition and bridge/interim
loans from $5 million to $30 * HARRIS WILLIAMS & CO. provides
million or more for hotel and merger and acquisition advisory
resort properties in the U.S., services targeting middle
Canada and the Caribbean. market businesses.
Through this division, we also
provide equity investments in FINOVA is a Delaware corporation. We
credit-oriented real estate were incorporated in 1991 to serve as
sale leasebacks. the successor to The Dial Corp's
financial services businesses. In
* TRANSPORTATION FINANCE March 1992, Dial transferred those
structures equipment loans, businesses to us in a spin-off. Since
leases, acquisition financing that time, FINOVA has increased its
and leveraged lease equity total assets from about $2.6 billion
investments for commercial and at December 31, 1992 to $10.4 billion
cargo airlines worldwide, at December 31, 1998. Income from
railroads and operators of other continuing operations increased from
transportation related $36.8 million in 1992 to $160.3
equipment. Typical transaction million in 1998. We believe FINOVA
sizes range from $5 million to ranks among the largest independent
$30 million. Through Finova commercial finance companies in the
Aircraft Investors, LLC, we also U.S., based on total assets. Our
seek to use our market expertise common stock is traded on the New
and industry presence to York Stock Exchange under the symbol
purchase, upgrade and resell FNV.
used commercial aircraft.
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this sacrificing prudent lending
prospectus are "forward-looking," in standards. Doing business under
that they do not discuss historical those standards becomes more
fact but instead note future difficult, however, when
expectations, projections, intentions competitors offer financing with
or other items. These forward-looking lower pricing or less stringent
statements include matters in the criteria. FINOVA may not be
section of this prospectus captioned successful in maintaining and
"FINOVA." They are also made in continuing asset growth at
documents incorporated in this report historic levels.
by reference.
* The cost of FINOVA's capital.
Forward-looking statements are That cost depends on many
subject to known and unknown risks, factors, some of which are
uncertainties and other factors that beyond FINOVA's control, such as
may cause FINOVA's actual results or its portfolio quality, ratings,
performance to differ materially from prospects and outlook. Changes
those contemplated by the in the interest rate environment
forward-looking statements. Many of may reduce or eliminate profit
those factors are noted in conjunction margins.
with the forward-looking statements in
the text. Other important factors that * Changes in government
could cause actual results to differ regulations, tax rates and
include: similar matters. For example,
government regulations could
* The results of FINOVA's efforts significantly increase the cost
to implement its business of doing business or could
strategy. Failure to fully eliminate certain tax advantages
implement its business strategy of some of FINOVA's financing
might result in decreased market products.
penetration, adverse effects on
results of operations and other * Necessary technological changes
adverse results. (including those addressing
"Year 2000" data systems issues)
* The effect of economic may be more difficult, expensive
conditions and the performance or time consuming than
of FINOVA's borrowers. Economic anticipated.
conditions in general or in
particular market segments could * Costs or difficulties related to
impact the ability of FINOVA's integration of acquisitions.
borrowers to operate or expand
their businesses, which might * Other risks detailed in FINOVA's
result in decreased performance other SEC reports or filings.
for repayment of their
obligations or reduce demand for FINOVA does not intend to update
additional financing needs. The forward-looking information to reflect
rate of borrower defaults or actual results or changes in
bankruptcies may increase. assumptions or other factors that
could affect those statements. FINOVA
* Actions of FINOVA's competitors cannot predict the risk from reliance
and FINOVA's ability to respond on forward-looking statements in light
to those actions. FINOVA seeks of the many factors that could affect
to remain competitive without their accuracy.
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SELLING STOCKHOLDERS
We issued 211,379 shares of our common stock to the Selling
Stockholders in exchange for their interests in PBC in connection with our
acquisition of PBC by way of merger. At the effective time of the merger, the
shares of PBC of each Selling Stockholder automatically converted into the
number of our shares listed below opposite their names. The Selling Stockholders
may sell from time to time up to the number of shares listed opposite their
names.
Under the terms of a Registration Rights Agreement we entered into with
the Selling Stockholders, we agreed to use our best efforts to register for
offer or sale to the public the common stock issued to the Selling Stockholders.
The registration of these shares, however, does not necessarily mean that all or
any of the common stock will be sold by the Selling Stockholders. The shares of
Common Stock offered represent all shares of Common Stock owned by the
respective Selling Stockholders.
Selling Stockholder Shares Offered Hereby
------------------- ---------------------
Farhad Motia and Martha S. Motia, 100,658
as Trustees of the Motia Family
Trust dated 11/24/98
Frederick K. Bae 60,394
William Kuhns 30,197
Michael D. Murphy 10,065
Faramarz Motia 10,065
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USE OF PROCEEDS
We will not receive any of the through this prospectus. Those
proceeds from the sale of the common proceeds will be paid to the Selling
stock offered Stockholders.
PLAN OF DISTRIBUTION
The Selling Stockholders may sell prospectus. The Selling Stockholder
the common stock from time to time. may also loan or pledge the common
The Selling Stockholders may make stock to a broker-dealer and the
these sales on exchanges or in the broker-dealer may sell the loaned
over-the-counter market or otherwise, common stock. Upon a default, the
at prevailing prices or in negotiated broker-dealer may sell the pledged
transactions. The common stock may be common stock pursuant to this
sold by: (a) a block trade in which prospectus.
the broker-dealer will attempt to sell
the common stock as agent but may Broker-dealers or agents may
resell a portion of the block as receive compensation in the form of
principal to facilitate the commissions, discounts or concessions
transaction; (b) purchases by a from Selling Stockholders in amounts
broker-dealer as principal and resale to be negotiated in connection with
by that broker-dealer for its account the sale. These broker-dealers and any
pursuant to this prospectus; (c) an other participating broker-dealers may
exchange distribution under the rules be considered "underwriters" under the
of that exchange; and (d) ordinary Securities Act of 1933, as amended, in
brokerage transactions and connection with those sales. Any
transactions in which the broker commission, discount or concession
solicits purchasers. In effecting they receive may be considered
sales, broker-dealers engaged by the underwriting discounts or commissions
Selling Stockholders may arrange for under that Act.
other broker-dealers to participate in
the resales. In addition, any common The Selling Stockholders may agree
stock that qualify for sale under Rule to indemnify any broker-dealer or
144 may be sold under Rule 144 rather agent that participates in
than pursuant to this prospectus. transactions involving sales of the
common stock against certain
The Selling Stockholders may also liabilities, including liabilities
sell common stock short and redeliver arising under the Securities Act of
the common stock to close out these 1933.
short positions. The Selling
Stockholders may also enter into There is no assurance that any of
option, hedging or other transactions the Selling Stockholders will offer
with broker-dealers which require the for sale or sell any or all of the
delivery to the broker-dealer of the common stock covered by this
common stock. The broker-dealer may prospectus.
resell those shares pursuant to this
LEGAL MATTERS
Richard Lieberman, Esq., Vice General Counsel of FINOVA, will pass
President-Associate on the legality of the common stock
offered through this prospectus.
MISCELLANEOUS
You should rely only on the any jurisdiction in which the making
information contained or incorporated of an offer to sell or a solicitation
by reference in this document. We have of an offer to buy would not be
not authorized anyone to provide you authorized. Additionally, this
with information that is different. document is not an offer to sell or a
This document is not an offer to sell solicitation of an offer to buy common
or a solicitation of an offer to buy stock to anyone to whom it would be
common stock by anyone not qualified unlawful to do so.
to do so or by anyone in
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TABLE OF CONTENTS
WHERE YOU CAN FIND MORE INFORMATION..2
FINOVA (BUSINESS)....................2
SPECIAL NOTE REGARDING FORWARD-
LOOKING STATEMENTS...................5
SELLING STOCKHOLDERS.................6
USE OF PROCEEDS......................7
PLAN OF DISTRIBUTION.................7
LEGAL MATTERS........................7
MISCELLANEOUS........................7
