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Pricing Supplement dated March 2, 1998 Rule #424(b)(3)
(To Prospectus dated August 6, 1997) File No. 333-28291
$200,000,000 Principal Amount
Advanta Corp.
91 Day Notes
Six, Eighteen and Thirty Month Notes
One, Two, Three, Four, Five, Seven and Ten Year Notes
<TABLE>
<CAPTION>
Annual Annual
Interest Percentage Interest Percentage
Rate Yield Rate Yield
Maturity Per Annum (APY) Maturity Per Annum (APY)
-------- --------- ----- -------- --------- -----
<S> <C> <C> <C> <C> <C>
91 Days 5.97% 6.15% One Year 6.86% 7.10%
Six Months 6.53% 6.75% Two Years 7.14% 7.40%
Eighteen Months 6.95% 7.20% Four Years 7.56% 7.85%
Thirty Months 7.23% 7.50% Five Years 7.70% 8.00%
</TABLE>
RECENT DEVELOPMENTS
On October 28, 1997, Advanta Corp. (the "Company") announced that it
had reached a definitive agreement under which the Company would contribute its
consumer credit card business to Fleet Credit Card, LLC, a Rhode Island limited
liability company (the "LLC") in exchange for a 4.99% interest in the LLC,
pursuant to the terms of a Contribution Agreement (the "Contribution
Agreement") with Fleet Financial Group, Inc. ("Fleet") (the "Transaction").
Under the terms of the Contribution Agreement, Fleet would contribute its
consumer credit card business to the LLC in exchange for a 95.01% interest in
the LLC. The Company would continue to operate its mortgage and business
services companies.
The Company also announced that Dennis Alter will resume his long-held
position as Chief Executive Officer of the Company. Alex "Pete" Hart, former
Chief Executive Officer, and Jim Allhusen, Group Executive of Advanta Personal
Payment Services, are leaving to pursue other interests.
A Special Meeting of stockholders of the Company (the "Special
Meeting") was held on February 20, 1998 at the Company's headquarters. At the
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Special Meeting, holders of shares of the Company's Class A Common Stock and
Class A Preferred Stock were asked to vote upon a proposal to approve the
Transaction.
At the Special Meeting, 12,754,956 votes were cast in favor of
approving the Transaction, 53,954 votes were cast against the Transaction and
7,838 votes cast to abstain.
The transactions contemplated by the Contribution Agreement were
consummated on February 20, 1998.
In connection with the consummation of the transactions contemplated
by the Contribution Agreement, four of the nationally recognized rating
agencies lowered their ratings of the Company's debt securities. As of the
date of this Pricing Supplement, senior debt of the Company is rated investment
grade (at or above investment grade level) by one of the nationally recognized
rating agencies, but is below investment grade by the other three rating
agencies, including Standard and Poor's and Moody's Investors Service.
Pursuant to the terms of an Offer to Purchase dated January 20, 1998
(the "Offer to Purchase"), the Company made a tender offer (the "Tender Offer")
to purchase 7,882,750 shares of its Class A Common Stock, including associated
Class A Purchase Rights (collectively, the "Class A Shares"), 12,482,850 shares
of its Class B Common Stock, including associated Class B Purchase Rights
(collectively, the "Class B Shares") and 1,078,930 shares of its Depositary
Shares each representing a one one-hundredth interest in a share of 6-3/4%
Convertible Class B Preferred Stock, Series 1995 (Stock Appreciation Income
Linked Securities (SAILS)) (the "SAILS Depositary Shares"). The Company
offered to purchase the Class A Shares and Class B Shares each at a purchase
price, net to the seller, in cash of $40 per share and offered to purchase the
SAILS Depositary Shares at a purchase price, net to the seller, in cash of
$32.80 per share. Following the completion of the Tender Offer, the Company
will be well-capitalized with a book value of approximately $650 million. The
Company will have approximately $6.6 billion in managed assets and an
additional $9.2 billion in assets serviced for third parties.
The Tender Offer expired at 12:00 Midnight, New York City time on
February 20, 1998 (the "Expiration Date"). As of the Expiration Date, subject
to final verification, approximately all of the outstanding Class A Shares,
Class B Shares and SAILS Depositary Shares were tendered in accordance with the
terms of the Offer to Purchase. A large number of the shares tendered were
through Notices of Guaranteed Delivery. Depending on the number of shares
ultimately delivered and the number of odd lots included in those deliveries,
the proration factor for the shares purchased may change.
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As more shares were tendered than the amount sought to be purchased by
the Company, the shares were purchased on a pro rata basis. The preliminary
proration factor for shares purchased is expected to be 43% for the Class A
Shares, 43% for the Class B Shares and 43% for the SAILS Depositary Shares.
The final proration factor will be announced as soon as it is available.
This Pricing Supplement contains forward-looking statements, including
but not limited to projections of future earnings, that are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those projected. The most significant among these risks and uncertainties
are: (1) factors that affect consumer debt; (2) the level of delinquencies and
charge-offs; and (3) competitive pressures; (4) the rate of prepayments; (5)
the level of expenses; (6) the timing of the securitizations of the Company's
receivables; and (7) the ratings on the debt of the Company and its
subsidiaries. Additional risks that may affect the Company's future
performance are detailed in the Company's filings with the Securities and
Exchange Commission, including its most recent Annual Report on Form 10-K and
its Quarterly Reports on Form 10-Q.
