UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OF 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
March 20, 2001 (Date of earliest event reported)
UGLY DUCKLING CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 000-20841 86-0721358
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
2525 East Camelback Road, Suite 500, Phoenix, Arizona 85016
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (602) 852-6600
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
INVESTMENT BANKER
Ugly Duckling Corporation (the "Company") previously reported in a press
release that it received an offer from its Chairman, Ernest C. Garcia II, to
purchase all of the outstanding shares of its common stock that are not already
owned by Mr. Garcia. The Company's Board of Directors has established a special
transaction committee, composed of disinterested directors, to evaluate the
offer and make a recommendation to the full board. On May 14, 2001, the special
transaction committee hired US Bancorp Piper Jaffray, an investment banker, to
assist in its evaluation of the offer and potential alternatives.
LITIGATION
On March 20, 2001, a shareholder derivative complaint was filed,
purportedly on behalf of Ugly Duckling Corporation, in the Court of Chancery for
the State of Delaware in New Castle County, captioned Berger v. Garcia, et al.,
No. 18746NC. The complaint alleges that the Company's current directors breached
fiduciary duties owed to the Company in connection with certain transactions
between the Company and Mr. Garcia and various entities controlled by Mr.
Garcia. The complaint was amended on April 17, 2001 to add a second cause of
action, on behalf of all persons who own the Company's common stock, and their
successors in interest, which alleges that the Company's current directors
breached fiduciary duties in connection with the proposed acquisition by Mr.
Garcia of all of the outstanding shares of the Company's common stock. The
Company is named as a nominal defendant in the action. The original cause of
action seeks to void all transactions deemed to have been approved in breach of
fiduciary duty and recovery by the Company of alleged compensatory damages
sustained as a result of the transactions. The second cause of action seeks to
enjoin the Company from proceeding with the proposed acquisition by Mr. Garcia,
or, in the alternative, awarding compensatory damages to the class.
Following Mr. Garcia's offer, five additional and separate purported
shareholder class action complaints were filed between April 17 and April 25,
2001 in the Court of Chancery for the State of Delaware in New Castle County.
They are captioned Turberg v. Ugly Duckling Corp., et al., No. 18829NC, Brecher
v. Ugly Duckling Corp., et al., No. 18828NC, Suprina v. Ugly Duckling
Corporation, et al., No. 18830NC, Benton v. Ugly Duckling Corp., et al., No.
18838NC, and Don Hankey Living Trust v. Ugly Duckling Corporation, et al., No.
18843NC. Each complaint alleges that the Company, and its directors, breached
fiduciary duties in connection with the proposed acquisition by Mr. Garcia of
all of the outstanding shares of the Company's common stock. The complaints seek
to enjoin the proposed acquisition by Mr. Garcia and to recover compensatory
damages caused by the proposed acquisition and the alleged breach of fiduciary
duties.
The Company expects all of these cases to be consolidated.
The defendants intend to vigorously defend the allegations in the
complaints and believe that the actions are without merit.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: May 14, 2001 UGLY DUCKLING CORPORATION
(Registrant)
By: /s/ Jon D. Ehlinger
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(Signature)
Jon D. Ehlinger
Vice President, Secretary and
General Counsel