1
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): December 5, 1997
CITYSCAPE FINANCIAL CORP.
(Exact name of registrant as specified in its charter)
DELAWARE 0-27314 11-2994671
State or Other Jurisdiction Commission File Number (IRS Employer
of Incorporation Identification No.)
565 Taxter Road, Elmsford, New York 10523-5200
(Address of Principal Executive Offices) Zip Code
Registrant's telephone number, including area code: (914) 592-6677
Former name or former address,
if changed since last report
2
Item 5. Other Events.
On October 27, 1997, Cityscape Financial Corp. (the "Company") received
requests from the Nasdaq Stock Market ("Nasdaq") for information regarding the
Company's compliance with Nasdaq's listing requirements and corporate governance
rules. Following submission to Nasdaq of the requested information, the Company
was notified on December 5, 1997 by Nasdaq that the Company's Common Stock (the
"Common Stock") will be de-listed from the Nasdaq National Market.
The Company has requested a hearing to review its compliance with the
Nasdaq listing requirements and the findings of the Listing Qualifications
Staff. There can be no assurance that the Company will be successful in such
hearing. Should the Common Stock be de-listed from Nasdaq, it is likely that the
liquidity of the Company's securities will be impaired, delays will occur in the
processing of purchase and sale transactions in the Common Stock and coverage of
the Company by security analysts and the media will be reduced, all of which
likely will result in lower prices for the Company's securities than would
otherwise prevail.
In addition, pursuant to the terms of the Company's 6% Convertible
Preferred Stock, Series A (the "Series A Preferred Stock"), and the Company's 6%
Convertible Preferred Stock, Series B (the "Series B Preferred Stock" and,
together with the Series A Preferred Stock, the "Preferred Stock"), the Company
is required to continue the listing or trading of the Common Stock on Nasdaq or
on certain other securities exchanges. In the event of a de-listing of the
Common Stock and permanently thereafter, (i) the conversion
restrictions that apply to the Series B Preferred Stock will be lifted
(currently, no more than 50% of the 5,000 shares of Series B Preferred Stock
initially issued may be converted) and (ii) the conversion period will be
increased to 15 consecutive trading days and the conversion discount will be
increased to 10% (currently, the conversion price is equal to the lowest daily
sales price of the Common Stock during the four consecutive trading days
immediately preceding conversion, discounted by up to 4%). In addition, in the
event of a de-listing of the Common Stock and during the continuance
of such de-listing, (i) the dividend rate will be increased to 15% and (ii) the
Company will be obligated to make monthly cash payments to the holders of the
Preferred Stock equal to 3% of the $10,000 liquidation preference per share of
the Preferred Stock (the "Liquidation Preference"), provided that if the Company
is prohibited from making such payments, such amounts will be added to the
Liquidation Preference. As of December 16, 1997, 672 shares of Series A
Preferred Stock and 4,776 shares of Series B Preferred Stock were outstanding.
Cityscape Financial Corp. is a consumer finance company that, through
its wholly-owned subsidiaries, Cityscape Corp. and City Mortgage Corporation
Limited, is engaged in the business of originating, purchasing, selling and
servicing mortgage loans in the United States and the United Kingdom, secured
primarily by one- to four-family residences.
Cityscape was founded in 1985 and is headquartered in Elmsford, New
York with regional processing offices in California, Georgia, Illinois and
Virginia.
This report on Form 8-K contains forward-looking statements which
involve risks and uncertainties. The Company's actual results could differ
materially from those anticipated in these forward-looking statements as a
result of certain factors including, but not limited to, risks related to
operations in the UK, liquidity and negative cash flows, uncertainty as to
availability of funding sources, dependence on securitizations, potential
changes in valuations of interest only and residual certificates and mortgage
servicing receivables, risks of adverse economic conditions, risks related to
recent expansion and product extension, competition, and other risks detailed
from time to time in the Company's SEC reports. The Company undertakes no
obligation to release publicly any revisions to these forward-looking statements
to reflect events or circumstances after the date hereof or to reflect the
occurrence of anticipated or unanticipated events.
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this Current Report on Form 8-K to be
signed on its behalf by the undersigned hereunto duly authorized.
CITYSCAPE FINANCIAL CORP.
(Registrant)
By: /s/ Tim S. Ledwick
-----------------------------------
Name: Tim S. Ledwick
Title: Vice President-CFO
Dated: December 17, 1997