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: July 9, 1997
MS FINANCIAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-26474 64-0835847
(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File Number) I. D. Number)
715 S. Pear Orchard Road
Suite 300
Ridgeland, Mississippi 39157 (601) 978-6737
(Address of principal executive (Registrant's telephone number,
offices) (Zip Code) including area code)
Item 5. Other Events
On June 25, 1997, Registrant entered into a letter agreement
with Search Financial Services (the "Amendment") amending the
Agreement and Plan of Merger (the "Merger Agreement") dated as of
February 7, 1997 by and among Registrant, Search Financial
Services ("Search"), and Search Capital Acquisition Corp.
pursuant to which a wholly-owned subsidiary of Search will merge
into Registrant (the "Merger"), resulting in Registrant becoming
a wholly-owned subsidiary of Search. In the Merger, each
outstanding share of common stock of Registrant will be converted
at the effective time of the Merger into the right to receive a
fraction (the "Exchange Ratio") of a share of common stock of
Search determined by reference to the average price per share of
the common stock of Search for the 10-day trading period ending
on the fifth business day prior to the special meeting of
stockholders of the Registrant at which the Merger Agreement will
be considered for adoption (the "Average Trading Price").
Pursuant to the Amendment, the Exchange Ratio will equal $1.63
(the "Per Share Amount") divided by the Average Trading Price,
subject to a maximum of .37 and a minimum of .28. The price
adjustment provisions of the Merger Agreement have been deleted.
The Merger is expected to be consummated promptly following
receipt of stockholder approval which should result from a
stockholder meeting currently scheduled for July 31 and the
satisfaction of other customary closing conditions, including
finalization of arrangements with Registrant's lenders. Approval
of the Merger by Registrant's stockholders requires the
affirmative vote of a majority of the outstanding shares of
common stock of Registrant. Pursuant to a Stockholders'
Agreement dated as of February 7, 1997 (the "Stockholders'
Agreement"), Registrant's principal stockholders, which together
own approximately 77% of Registrant's outstanding common stock,
have agreed to vote their shares in favor of the Merger.
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits
Exhibit No. Description
2.1 Letter Agreement dated June 25, 1997 by and among
Search Financial Services Inc., Search Capital
Acquisition Corp., and MS Financial, Inc.
<PAGE>
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.
MS FINANCIAL, INC.
Dated: July 9, 1997 By:/s/R. Dale Miller
R. Dale Miller
Controller and Principal Accounting
Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
2.1 Letter Agreement dated June 25, 1997 by and among
Search Financial Services Inc., Search Capital
Acquisition Corp., and MS Financial, Inc.
EXHIBIT 2.1
June 25, 1997
MS Financial, Inc.
715 S. Pear Orchard Road
Ridgeland, MS 39157
Gentlemen:
This letter confirms our agreement that the Agreement and
Plan of Merger by and among us dated as of February 7, 1997 (the
"Merger Agreement") is amended as follows:
1. Sections 1.2 (g) and (h) of the Merger Agreement and
all references to Sections 1.2 (g) and (h) in the Merger
Agreement are deleted;
2. Sections 1.2 (d) of the Merger Agreement is amended to
read in its entirety as follows:
"(d) Maximum and Minimum Exchange Ratio.
Notwithstanding the provisions of Section 1.2 (c) above and
except for any adjustment made pursuant to Section 1.2 (e),
in no event will the Exchange Ratio exceed .37 or be less
than 0.28."
3. Sections 2.2 (f), 8.2, 8.3, 8.4, 8.5, 8.6, 8.10, 8.37,
8.61 and 8.70 of the Merger Agreement are deleted;
4. Section 7.1 (b) of the Merger Agreement is amended by
changing the date reference therein from "June 30, 1997" to
"August 15, 1997"; and
5. Section 8.77 of the Merger Agreement is amended to read
in its entirety as follows:
"8.77. "Per Share Amount" means $1.63, or such
amount adjusted pursuant to Section 1.2 (e) if such an
adjustment is to be made."
Please acknowledge your agreement to the foregoing by
signing this letter in the space provided below.
Sincerely,
SEARCH FINANCIAL SERVICES, INC.
By: /s/ George C. Evans
George C. Evans
Chairman of the Board and
Chief Executive Officer
SEARCH CAPITAL ACQUISITION CORP.
By: /s/ Robert D. Idzi
Robert D. Idzi
Senior Executive Vice
President
Agreed:
MS FINANCIAL, INC.
By: /s/ James B. Stuart, Jr.
James B. Stuart, Jr.
Chairman of the Board
The undersigned acknowledge (1) their agreement to the
foregoing amendments to the Merger Agreement (the "Amendment"),
(2) that the Stockholders Agreement dated as of February 7, 1997
by and among Search Financial Services Inc. and the undersigned
(the "Stockholders Agreement") remains in full force and effect
and (3) that all references in the Stockholders Agreement to the
Merger Agreement shall be to the Merger Agreement as amended by
the Amendment.
MS FINANCIAL SERVICES, INC.
By: /s/ James B. Stuart, Jr.
James B. Stuart, Jr.
President
MS DIVERSIFIED CORPORATION
By: /s/ James B. Stuart, Jr.
James B. Stuart, Jr.
President
GOLDER, THOMA, CRESSY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P., its General
Partner
By: Golder, Thoma, Cressy,
Rauner, Inc., its General
Partner
By: /s/Donald J. Edwards
Donald J. Edwards
