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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: January 12, 1998
AT&T CAPITAL CORPORATION
A Delaware Commission File I.R.S. Employer
Corporation No. 1-11237 No. 22-3211453
44 Whippany Road, Morristown, New Jersey 07962-1983
Telephone Number (973) 397-3000
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Form 8-K January 12, 1998
Item 1. CHANGES IN CONTROL OF THE REGISTRANT
Item 5. OTHER EVENTS
On January 12, 1998, Newcourt Credit Group Inc., an Ontario corporation
("Newcourt"), consummated the purchase (the "Purchase") of all of the
outstanding shares of common stock, par value $.01 per share (the "Common
Stock"), of AT&T Capital Corporation ("AT&T Capital" or the "Company"), pursuant
to a Stock Purchase Agreement dated as of November 17, 1997 among Newcourt,
Hercules Holdings (Cayman) Limited ("Hercules (Cayman)"), the former direct
owner of approximately 97.4% of the Company's outstanding shares of Common
Stock, the Company, and the other former stockholders of the Company (which
Stock Purchase Agreement previously was filed as Exhibit A to the Company's
Form 8-K dated November 19, 1997). In connection with the Purchase, all of the
outstanding shares of Common Stock of the Company were transferred to Newcourt
Holdings USA, Inc., a newly-formed Delaware corporation which is a wholly-owned
subsidiary of Newcourt. As a result of the Purchase, all of the outstanding
shares of Common Stock of the Company are owned indirectly by Newcourt.
The aggregate purchase price paid by Newcourt to the former stockholders
of AT&T Capital for the Common Stock so purchased was US$1.03 billion in cash
and approximately 17.6 million Newcourt common shares. Such shares were issued
entirely to Hercules (Cayman) and generally may not be transferred for periods
ranging from 6 to 18 months following the date of the Purchase. The cash portion
(US$1.03 billion) of the purchase price paid by Newcourt was raised through the
issuance by Newcourt of approximately 38 million shares of Newcourt common stock
at approximately US$32.50 (C$46.00) per share to employees of Newcourt and the
public in Canada and the United States.
Newcourt has advised the Company that Newcourt intends for the Company
to operate as an indirect wholly-owned subsidiary of Newcourt which will
continue to issue commercial paper and medium and long-term debt in the public
markets. Newcourt has also advised the Company that Newcourt intends for
Newcourt and the Company on a consolidated basis to securitize approximately
40-45% of their new consolidated volumes and to move to a consolidated debt to
tangible equity ratio in the range of approximately 5:1 to approximately 6:1,
with the result that the securitization and leverage policies of the Company
will be adjusted to achieve those targets over time.
Newcourt has also advised the Company that, in connection with the
Purchase, Newcourt intends to either provide a guarantee for certain classes of
outstanding indebtedness for borrowed money of the Company or enter into a
support agreement with the Company for the benefit of the holders of such
certain classes of indebtedness. In addition, the Company intends to guarantee
certain outstanding indebtedness and liquidity facilities of Newcourt. As of
September 30, 1997, Newcourt's outstanding indebtedness for borrowed money
aggregated US$ 1.87 billion (C$2.58 billion). The ownership of the
US$200 million Trust Originated Preferred Securities, which were issued by
Capita Preferred Trust, a business trust originated by the Company in October,
1996, was not affected by the Purchase.
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Form 8-K January 12, 1998
Upon the Purchase, John Appleton, James Babcock, Max Chapman, Guy Hands,
Ray Hart, Djomko Iwai and Joseph Melone resigned as members of the Company's
Board of Directors. Following the Purchase, the Board of Directors of the
Company was reduced from nine members to two members with Steven K. Hudson, the
Chief Executive Officer of Newcourt, and David A. Banks being respectively
elected and re-elected as members of the Company's Board of Directors.
Prior to the Purchase, all of the outstanding shares of Common Stock of
the Company were owned either (i) indirectly, through ownership of 100% of the
common shares of Hercules (Cayman), by The Grand Leasing Company Limited (UK)
("Grand Leasing"), which in turn is beneficially owned through warrants to
acquire 100% of the common shares of Grand Leasing by Nomura International plc
("Nomura"), a wholly-owned indirect subsidiary of The Nomura Securities Co.,
Ltd. ("Nomura Securities"), and (ii) directly, by 21 members and one former
member of the senior management of the Company (the "Management Stockholders"),
with the Management Stockholders owning directly approximately 2.6% of the
outstanding shares of Common Stock of the Company (or approximately 4.7% on a
fully diluted basis) and Grand Leasing owning indirectly approximately 97.4% of
the outstanding shares of Common Stock of the Company (or approximately 93.6% on
a fully diluted basis). The Company's employees and outside directors owned
approximately 1.7% of the Common Stock on a fully-diluted basis.
After giving effect to, and as a result of, the Purchase, approximately
17.6 million common shares of Newcourt or approximately 12.67% of the
outstanding common shares of Newcourt (12.31% on a fully diluted basis) are
owned directly by Hercules (Cayman) and indirectly, as described above, by
Nomura. Canadian Imperial Bank of Commerce ("CIBC"), the second largest bank in
Canada in terms of assets, separately owns approximately 8.8 million common
shares of Newcourt or approximately 6.33% of the outstanding common shares of
Newcourt (6.15% on a fully diluted basis), which shares were acquired by CIBC in
1997. In addition, Capital Research and Management Company, Inc., a mutual
fund, owns approximately 11.3 million common shares of Newcourt or
approximately 8.15% of the outstanding common shares of Newcourt (approximately
7.92% on a fully diluted basis); the AIC Group of Funds, a mutual fund manager,
owns approximately 10.8 million common shares of Newcourt or approximately 7.74%
of the outstanding common shares of Newcourt (approximately 7.52% on a fully
diluted basis); and Mutual Life Assurance Company of Canada ("Mutual Life"), one
of the largest life assurance companies in Canada, owns approximately 3.1
million common shares of Newcourt or approximately 2.21% of the outstanding
common shares of Newcourt (approximately 2.15% on a fully diluted basis).
Hercules (Cayman), CIBC, Mutual Life and certain investment entities controlled
by certain management shareholders of Newcourt (Mr. Hudson, David D. McKerroll
and Bradley D. Nullmeyer, each of whom currently serves as a director of
Newcourt) have agreed to vote the common shares of Newcourt owned by them so as
to elect as members of Newcourt's Board of Directors two (2) nominees selected
by each of Hercules (Cayman), CIBC and Mutual Life and three (3) nominees
selected by such management shareholders, subject to certain statutory and
contractual restrictions (including, without limitation, the requirement that
a majority of the Board of Directors shall be independent directors selected and
approved by the Nominating Committee of Newcourt's Board of Directors). In
addition, Hercules (Cayman), CIBC and Mutual Life each have certain contractual
rights involving material credit and investment decisions of Newcourt.
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Form 8-K January 12, 1998
When included in this Current Report on Form 8-K, the words, "will",
"should", "expects", "intends", "anticipates", "estimates" and similar
expressions, among others, identify forward looking statements for purposes of
Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A
of the Securities Act of 1933, as amended. Such statements which include
statements contained in this Current Report inherently are subject to a variety
of risks and uncertainties that could cause actual results to differ materially
from those set forth in such statements. Such risks and uncertainties, many of
which are beyond the control of AT&T Capital, include, among others, those
described under "Risk Factors" included in Item 7 of the Company's 1996 Annual
Report on Form 10-K. These forward looking statements are made only as of the
date of this Current Report on Form 8-K. The Company expressly disclaims any
obligation or undertaking to release any update or revision to any forward
looking statement contained herein to reflect any change in the Company's
expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.
The joint press releases of Newcourt and the Company are attached hereto
as Exhibits 99(a) and 99(b) are incorporated herein by reference.
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Form 8-K January 12, 1998
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99(a) Press Release issued by Newcourt and the Company
dated January 12, 1998 regarding closing of AT&T
Capital acquisition.
99(b) Press Release issued by Newcourt and the Company dated
January 12, 1998 regarding Newcourt guarantee or support
of AT&T Capital debt.
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Form 8-K January 12, 1998
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 thereunto duly authorized.
AT&T CAPITAL CORPORATION
RAMON OLIU, JR.
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By: Ramon Oliu, Jr.
Senior Vice President and
Chief Financial Officer
January 26, 1998
STATEMENT OF DIFFERENCES
The British pound sterling sign shall be expressed as......................'L'
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Form 8-K January 12, 1998
EXHIBIT INDEX
Exhibit
99(a) Press Release issued by Newcourt and the Company
dated January 12, 1998 regarding closing of AT&T
Capital acquisition.
99(b) Press Release issued by Newcourt and the Company dated
January 12, 1998 regarding Newcourt guarantee or support
of AT&T Capital debt.