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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) March 5, 2001
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GATX CAPITAL CORPORATION
Incorporated in the IRS Employer Identification Number
State of Delaware 94-1661392
Four Embarcadero Center
San Francisco, CA 94111
(415) 955-3200
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ITEM 5. OTHER EVENTS
On March 5, 2001, GATX Corporation and GATX Capital Corporation issued
the following press release:
GATX Corporation and GATX Capital Corporation today reported on the
conclusion of the second phase of a trial in Federal District Court for the
Northern District of California to which GATX Capital is a party.
As noted in a press release issued February 20, 2001, GATX Capital is
party to litigation related to the modification of aircraft from passenger to
freighter configuration. The aircraft were modified by GATX/Airlog, a California
partnership in which a subsidiary of GATX Capital is a partner. In the first
phase of the trial, concluded on February 16, the jury found against GATX/Airlog
on two counts related to breach of contract and non-disclosure of information.
Following the conclusion of the second phase of the trial, the jury
awarded damages to Kalitta Air in the amount of $47.5 million plus applicable
interest. Prior to the conclusion of the second phase of the trial, GATX Capital
agreed to settle a related dispute with Evergreen International Airlines, Inc.,
which had also been a party in the litigation. Terms of the settlement with
Evergreen have not been disclosed.
GATX Corporation is in the process of determining the impact on its
2000 financial results arising from GATX/Airlog-related matters. Based on a
preliminary analysis, the net after-tax impact of the resolution of
GATX/Airlog-related matters, including required reserves and all prior
settlement expenses including Evergreen, is expected to be approximately $100
million, excluding any post-judgment interest expense. This is an estimation of
GATX's maximum liability for all GATX/Airlog-related matters, and does not
reflect the fact that GATX will aggressively pursue all means of loss recovery
including appeals and insurance coverage.
Ronald H. Zech, chairman of GATX Corporation, stated, "We vehemently
disagree with the jury's findings and the subsequent damage award in this
litigation, and we plan to pursue appeals to address issues that arose before
and during this trial. At the same time, we also recognize that the GATX/Airlog
litigation has led to uncertainty with regards to the potential financial impact
on GATX Corporation. By providing an estimate of our maximum potential liability
for all
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GATX/Airlog matters, which if confirmed will be manageable in the context of
GATX's financial position and cash flow, we can clarify the situation and
address this uncertainty."
GATX Corporation's 2000 Annual Report on Form 10-K, incorporating the
reserve and settlement expenses, will be filed later in March in conjunction
with the distribution of the company's Annual Report to shareholders.
SIGNATURE
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.
GATX CAPITAL CORPORATION
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(Registrant)
/s/ Curt F. Glenn
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Curt F. Glenn
Senior Vice President and
Chief Financial Officer
(Duly Authorized Officer)
Date: March 5, 2001