U.S. 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): November 10, 2006
-------------------
PERFORMANCE CAPITAL MANAGEMENT, LLC
------------------------------------------------------
(Exact name of registrant as specified in its charter)
CALIFORNIA 0 - 50235 03-0375751
----------------- ------------ ----------------
(State or other (Commission (I.R.S. Employer
Jurisdiction File Number) Identification No.)
of incorporation)
222 SOUTH HARBOR BLVD., SUITE 400
ANAHEIM, CALIFORNIA 92805
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (714) 502-3780
----------------
-----------------------------------------------------------------
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 8.01 OTHER EVENTS.
On November 10, 2006, Performance Capital Management, LLC (the "Company")
commenced a Voluntary Sale Program (the "Program") offering to those Unit
holders who own a total of 99 or fewer Company Units the option to sell all (but
not less than all) of their Units back to the Company at a price of $4.75 per
Unit. The offer will expire at 5:00 PM Eastern Time on December 22, 2006, unless
extended.
The price per Unit was determined by the Company's Board of Directors after its
consideration of a number of factors, including:
- the lack of a public trading market;
- the average annual Unit distribution made by the Company;
- the cost to the Company of maintaining and servicing small accounts;
- the savings to the Company if future distributions to holders of fewer
than 100 Units are eliminated as a result of the purchase of those
Units;
- the inconvenience experienced by holders of fewer than 100 Units in
preparing their individual tax returns, due to the fact that they must
wait to receive K-1's from the Company each year prior to doing so,
particularly in light of the relatively small amounts reflected in the
K-1's;
- the fact that the value of each Unit is not equal because under the
Company's Operating Agreement holders of Units do not all receive
distributions from the Company in the same amount per Unit;
- the requirement, under the applicable rule of the Securities and
Exchange Commission, that the Company pay the same price per Unit to
all holders of fewer than 100 Units who elect to sell all of their
Units back to the Company, notwithstanding the fact that, under the
Company's Operating Agreement, holders of Units do not all receive
distributions from the Company in the same amount per Unit; and
- the fact that the number of holders of fewer than 100 Units increase
each year due to the lack of a trading market for the Units and the
distribution of Units to multiple recipients in most instances upon
the death of a Unit holder.
Each Unit holder who is eligible to participate in the Program can accept or
reject the Company's offer to purchase all of their Units. Once a Unit holder
accepts the Company's offer, it is irrevocable.
The primary objective of the Program is to provide a means for the Company to
reduce the number of Unit holders who own a small number of Units in order to
reduce the Company's cost of servicing those accounts.
Approximately 1,100 Unit holders of the Company's 2,500 record Unit holders are
believed by the Company to own in aggregate 99 or fewer Units and such Unit
holders own a total of approximately 78,000 Units out of 564,125 Units
outstanding. The potential outlay to repurchase the units could total $370,000.
The amount of the cost savings to the Company is dependent upon the number of
Units repurchased by the Company.
1
The effect of the repurchases on Unit holders who own in aggregate 100 or more
Units will be an increase in their percentage interest in the Company.
Following the Company's repurchase of LLC Units, a Unit holder who previously
beneficially owned less than 10% of the Company's outstanding Units may
beneficially own more than 10% of the Company's outstanding Units without having
purchased additional Units. If, before the repurchase, the Unit holder is aware
that the repurchase will occur and will have this result on his or her holdings,
the Unit holder must file a Form 3 within ten (10) [business] days after the
repurchase that results in the unit holder beneficially owning more than 10% of
the Company's outstanding LLC Units. If the Unit holder is unaware of the
repurchase and/or its consequences, he or she would not have to file a Form 3
until information in the Company's most recent quarterly, annual or current
report indicates the amount of LLC Units outstanding following the repurchase.
Similarly, a Unit holder who previously beneficially owned less than 5% of the
Company's outstanding Units may beneficially own 5% or more of the Company's
outstanding Units without having purchased additional Units. If the repurchase
will have this result on his or her holdings, the Unit holder must file a
Schedule 13G within forty-five (45) days after the end of the year in which the
repurchase occurred, in accordance with Regulation [13D] under the Act.
This report on Form 8-K is not an offer to purchase or a solicitation of an
offer to purchase with respect to the Company's Units. The offer is being made
upon the terms set forth in the Program.
FORWARD-LOOKING STATEMENTS
--------------------------
Except for the historical information presented in this document, the matters
discussed in this Form 8-K or otherwise incorporated by reference into this
document contain "forward-looking statements" (as such term is defined in the
Private Securities Litigation Reform Act of 1995). These statements can be
identified by the use of forward-looking terminology such as "believes,"
"plans," "expects," "may," "will," "intends," "should," "plan," "assume" or
"anticipates" or the negative thereof or other variations thereon or comparable
terminology, or by discussions of strategy that involve risks and uncertainties.
The safe harbor provisions of Section 21E of the Securities Exchange Act of
1934, as amended, and Section 27A of the Securities Act of 1933, as amended,
apply to forward-looking statements made by Performance Capital Management, LLC.
You should not place undue reliance on forward-looking statements.
Forward-looking statements involve risks and uncertainties. The actual results
that we achieve may differ materially from any forward-looking statements due to
such risks and uncertainties. These forward-looking statements are based on
current expectations, and we assume no obligation to update this information.
Readers are urged to carefully review and consider the various disclosures made
by us in this report on Form 8-K and in our other reports filed with the
Securities and Exchange Commission that attempt to advise interested parties of
the risks and factors that may affect our business.
2
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 hereunto duly authorized.
PERFORMANCE CAPITAL MANAGEMENT, LLC
November 14, 2006 By: /s/ David J. Caldwell
- ---------------------- -----------------------------
(Date) David J. Caldwell
Its: Chief Operations Officer
3