SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED
PURSUANT TO RULE 13d-2(a)
THE FINOVA GROUP INC.
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(Name of Issuer)
COMMON STOCK, PAR VALUE $0.01 PER SHARE
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(Title of Class of Securities)
317928109
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(CUSIP Number)
MARC D. HAMBURG
BERKSHIRE HATHAWAY INC.
1440 KIEWIT PLAZA
OMAHA, NEBRASKA 68131
(402) 346-1400
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
AUGUST 21, 2001
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(Date of Event Which Requires Filing of this Statement)
If the person has previously filed a statement on Schedule 13G to report the
acquisition that is the subject of this Schedule 13D, and is filing this
Schedule because of Rule 13d-1(e), 13d-1(f) or 13d-(g), check the following box
/ /.
Note. Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 18 pages)
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/1/ The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 or otherwise subject to the liabilities of that section of the Act but
shall be subject to all other provisions of the Act (however, see the Notes).
CUSIP NO. 317928109 13D PAGE 2 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Berkadia LLC
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
BK (see Item 3)
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Item 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Item 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
OO - Limited Liability Company
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CUSIP NO. 317928109 13D PAGE 3 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Berkadia Management LLC
------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
OO - Limited Liability Company
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CUSIP NO. 317928109 13D PAGE 4 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BHF Berkadia Member, Inc.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 0
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
CO
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CUSIP NO. 317928109 13D PAGE 5 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BH Finance LLC
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Nebraska
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
OO - Limited Liability Company
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CUSIP NO. 317928109 13D PAGE 6 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Columbia Insurance Company
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Nebraska
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SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
IC, CO
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CUSIP NO. 317928109 13D PAGE 7 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BH Columbia Inc.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
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SOURCE OF FUNDS
4
N/A
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Nebraska
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SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
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TYPE OF REPORTING PERSON*
14
CO
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CUSIP NO. 317928109 13D PAGE 8 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
OBH, Inc.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
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SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
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CUSIP NO. 317928109 13D PAGE 9 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Berkshire Hathaway Inc.
------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Items 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
HC, CO
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CUSIP NO. 317928109 13D PAGE 10 OF 18 PAGES
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1 S.S OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Warren E. Buffett
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS
4
N/A
------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(e) or 2(f) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
United States Citizen
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY 61,020,581 (see Item 5 and 6)
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
61,020,581 (see Items 5 and 6)
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
61,020,581 (see Item 5)
------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
50.0% (see Item 5)
------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
HC, IN
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CUSIP NO. 317928109 13D PAGE 11 OF 18 PAGES
This Statement on Schedule 13D is filed in connection with the issuance of
61,020,581 shares ("Shares") of common stock of The FINOVA Group Inc. (the
"Company") to Berkadia LLC, a Delaware limited liability company ("Berkadia"),
whose members are Berkadia Management LLC, a Delaware limited liability company
("Management"), BHF Berkadia Member Inc., a Delaware corporation ("Member") and
an indirect wholly owned subsidiary of Berkshire Hathaway Inc., a Delaware
corporation ("Berkshire"), and WMAC Investors, Inc., a Delaware corporation and
an indirect wholly owned subsidiary of Leucadia National Corporation, a New York
corporation ("Leucadia"). Management's members are BH Finance LLC, a Nebraska
limited liability company ("Finance") (and a wholly owned subsidiary of Columbia
Insurance Company, a Nebraska corporation ("Columbia")), and WMAC Investment
Corporation, a Wisconsin corporation and indirect wholly owned subsidiary of
Leucadia ("WMAC"). Columbia is a wholly owned subsidiary of BH Columbia Inc., a
Nebraska corporation ("BH Columbia"), which is in turn a wholly owned subsidiary
of OBH, Inc., a Delaware corporation ("OBH"). OBH is a wholly owned subsidiary
of Berkshire. Berkshire, together with Member, Finance, Columbia, BH Columbia
and OBH, are referred to herein as the "Berkshire Entities." Leucadia and its
subsidiaries are filing a separate Schedule 13D with respect to these Shares
(the "Leucadia 13D") that will include Berkadia and Management as reporting
persons. The information in this Schedule 13D and in the Leucadia 13D with
respect to Berkadia and Management is duplicative out of necessity, and does not
reflect the acquisition of shares of Company common stock other than the Shares.
ITEM 1. SECURITY AND ISSUER.
The name of the subject company is The FINOVA Group Inc., a Delaware
corporation, and the address of its principal executive offices is 4800 N.
Scottsdale Road, Scottsdale, Arizona 85251. The class of securities to which
this statement relates is the common stock, par value $0.01 per share, of the
Company.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(c); (f) This Statement is filed by Berkadia, Management, the
Berkshire Entities and Warren E. Buffett, who may be deemed to control the
Berkshire Entities. The information concerning the name, state or other place
of organization, principal business, principal business address and the address
of the principal office of each of Berkadia, Management, the Berkshire Entities
and Mr. Buffett, and the information concerning the name, business address,
present principal occupation or employment, and the name, principal business and
address of any corporation or other organization in which such employment or
occupation is conducted, and the citizenship of Mr. Buffett and each of the
executive officers and directors of Berkadia, Management and the Berkshire
Entities is filed as Exhibit 1 hereto.
(d); (e) During the last five years, none of Berkadia, Management, the
Berkshire Entities or Mr. Buffett, nor, to the best of their knowledge, any of
the directors or executive officers of Berkadia, Management or the Berkshire
Entities has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or was a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction as a result of which
any such person was or is subject to a judgment, decree, or final order
enjoining future violations of, or prohibiting activities subject to, federal or
state securities laws or finding any violation of such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The Shares were issued to Berkadia pursuant to the Third Amended and
Restated Joint Plan of Reorganization of Debtors Under Chapter 11 of the
Bankruptcy Code, as amended and supplemented (the "Plan") filed by the Company
and eight of its subsidiaries (collectively, the "Debtors") with the U.S.
Bankruptcy Court. The U.S. Bankruptcy Court entered a confirmation order with
respect to the Plan on August 10, 2001. Pursuant to the Plan, on August 21,
2001, the effective date of the Plan (the
CUSIP NO. 317928109 13D PAGE 12 OF 18 PAGES
"Effective Date"), among other things, (i) Berkadia extended a $5,600,000,000
loan to the Company's subsidiary, FINOVA Capital Corporation ("FNV Capital"), on
a senior secured basis (the "Berkadia Loan"), (ii) the Company and substantially
all of its subsidiaries other than FNV Capital guaranteed FNV Capital's
repayment of the Berkadia Loan, (iii) the Company issued the Shares to Berkadia,
and (iv) the Company commenced the distributions to creditors of and holders of
interests in the Debtors pursuant to the Plan, including the issuance of senior
notes (the "New Senior Notes") by the Company. The Third Amended and Restated
Disclosure Statement with Respect to Joint Plan of Reorganization of Debtors
Under Chapter 11 of the Bankruptcy Code (the "Disclosure Statement"), which
includes the text of the Third Amended and Restated Joint Plan of Reorganization
dated June 13, 2001, and the Revised Technical Amendments to Third Amended and
Restated Joint Plan of Reorganization (the "Revised Plan Amendments") are
filed as Exhibit 2A and Exhibit 2B hereto, respectively, and are incorporated
herein by reference.
Berkadia financed the Berkadia Loan and acquired the Shares with funds
drawn under a $5,600,000,000 principal amount loan facility from a group of
lenders with Fleet Securities, Inc. as administrative agent (the "Fleet
Facility"). The Fleet Facility is secured by a pledge of the $5,600,000,000
secured promissory note from FNV Capital to Berkadia issued pursuant to the
Berkadia Loan. Leucadia has guaranteed repayment of the Fleet Facility on a
primary basis as to 10% of the Fleet Facility (the "Leucadia Guaranty"), and
Berkshire has guaranteed repayment of the Fleet Facility on a primary basis as
to 90% of the Fleet Facility, with a secondary guarantee of Leucadia's 10%
primary guarantee (the "Berkshire Guaranty"). The Fleet Facility is filed as
Exhibit 3 hereto and is incorporated herein by reference. The Leucadia Guaranty
and the Berkshire Guaranty are filed as Exhibit 4 and Exhibit 5 hereto,
respectively, and are incorporated herein by reference.
ITEM 4. PURPOSE OF TRANSACTION.
Berkadia's purpose in entering into these transactions was to obtain the
opportunity to profit from refinancing the Company. The following description of
certain portions of the Plan and the documents implementing the Plan is
qualified in its entirety by reference to (i) the Disclosure Statement, (ii) the
Plan (including the Revised Plan Amendments), (iii) the New Senior Notes
Indenture between the Company and The Bank of New York, as trustee, filed as
Exhibit 6 hereto, and (iv) the Credit Agreement between FNV Capital and
Berkadia, filed as Exhibit 7 hereto, all of which are incorporated herein by
reference.
Pursuant to the Plan, on August 21, 2001, Berkadia extended the Berkadia
Loan to FNV Capital which, together with the Debtors' cash on hand and the
issuance by the Company of the New Senior Notes to holders of claims against or
interests in the Debtors, enabled the Debtors to restructure their debt.
Because certain of Berkshire's subsidiaries were holders of unsecured claims
against FNV Capital, pursuant to the Plan, these subsidiaries have received or
will receive, in the aggregate, cash in the amount of approximately $1.07
billion and New Senior Notes in a principal amount of approximately $427
million.
Pursuant to the Plan, the Company's Board of Directors was reorganized as
of the Effective Date, and Berkadia (through Management, its manager) exercised
its right to designate four (4) of the initial directors, which constitutes a
majority of the initial reorganized Board of Directors of the Company as of the
Effective Date. Under the Berkadia Management LLC Operating Agreement, filed as
Exhibit 8 hereto and incorporated herein by reference, Finance nominated two of
these four directors and WMAC nominated the other two. Under the Plan, two
members of the initial reorganized Board of Directors of the Company are
directors who were serving on the Company's Board of Directors prior to the
Effective Date and one new director was designated by the Official Committee of
Creditors of the Debtors. Pursuant to the Plan, the bylaws of the Company were
amended on the Effective Date to provide that so long as at least $500,000,000
in aggregate principal amount of New Senior Notes are outstanding (excluding New
Senior Notes held by affiliates of the Company), the holders of New Senior Notes
unaffiliated with the Company (the "Unaffiliated Note Holders") shall be allowed
to designate the nominee for any replacement or successor to the director
CUSIP NO. 317928109 13D PAGE 13 OF 18 PAGES
designated by the creditors of the Company pursuant to the terms of the Plan to
serve on the Company's Board of Directors (such director and any successor
referred to herein as the "Note Holder Designee"). As further described in Item
6, Berkadia, Leucadia, Berkshire and the Company have entered into a Voting
Agreement, which is filed as Exhibit 10 hereto and incorporated herein by
reference, by which Berkadia is obligated to vote for the election of the Note
Holder Designee, as well as for removal of such Note Holder Designee if directed
by the Unaffiliated Note Holders.
Pursuant to the Plan, under a ten year Management Services Agreement with
Leucadia and its subsidiary, Leucadia International Corporation, a Utah
corporation, Leucadia will be responsible for the general management of the
Company, subject to the authority of the Company's Board of Directors, and has
designated its employees to act as Chairman of the Board and President of the
Company. Berkshire shares in the fees received by Leucadia under the Management
Services Agreement.
In connection with the Plan, Finance is commencing a tender offer on August
28, 2001 (the "Tender Offer") for up to $500 million in aggregate principal
amount of New Senior Notes at a cash purchase price of 70% of principal amount,
or $700 per $1,000 principal amount of New Senior Notes, without accrued
interest. The Tender Offer is subject to certain conditions. The Tender Offer
will remain open until September 26, 2001, unless extended. Finance will
purchase any and all New Senior Notes validly tendered, up to the $500 million
aggregate principal amount limit, and will pro rate among tendering holders if
the Tender Offer is oversubscribed.
Berkshire, together with its direct and indirect subsidiaries, has agreed
to retain ownership of all New Senior Notes received by Berkshire pursuant to
the Plan or purchased through Finance's Tender Offer for a period of four years
from the Effective Date. If Berkshire acquires New Senior Notes in addition to
those received by it on the Effective Date or purchased through the Tender
Offer, Berkshire may sell or otherwise dispose of any New Senior Notes it owns
so long as at all times during the four (4) years after the Effective Date it
owns not less than the aggregate principal amount of New Senior Notes that it
received on the Effective Date pursuant to the Plan and purchased through the
Tender Offer.
Following consummation of the Tender Offer, Berkshire may, from time to
time, acquire New Senior Notes through open market purchases, privately
negotiated transactions, tender offers, exchange offers or otherwise, upon such
terms and at such prices as it may determine, which may be more or less than the
price paid pursuant to the Tender Offer. Any such purchases would be subject to
the restrictions of the Berkadia LLC Operating Agreement and the Berkadia
Management LLC Operating Agreement, both of which are described in Item 6, and
which descriptions are incorporated herein by reference.
Under the terms of the Berkadia Loan, the Company will not be permitted to
pay any dividends or repurchase any common stock unless agreed to by Berkadia
and otherwise permitted by the terms of the New Senior Notes. For so long as
any of the New Senior Notes are outstanding, there will not be any dividends
made on, or repurchase of, the Company common stock other than as permitted by
the terms of the New Senior Notes. The New Senior Notes provide that: (a) after
payment in full of the Berkadia Loan, making payments or funding reserves
required prior to making an interest payment on the New Senior Notes (as
described above), paying accrued interest on the New Senior Notes and optional
purchases of New Senior Notes in permitted amounts, ninety-five percent (95%) of
the remaining "available cash" will be used to make semi-annual prepayments of
principal on the New Senior Notes and five percent (5%) will be used for
distributions to and/or repurchases of stock from the Company's stockholders;
and (b) after payment in full of the outstanding principal of the New Senior
Notes, optional purchases of New Senior Notes in permitted amounts, and payments
to Company common stockholders in an aggregate amount equal to 5.263% of the
aggregate principal amount of New Senior Notes issued pursuant to the Plan,
ninety-five percent (95%) of any "available cash" will be used to pay contingent
interest to holders of New Senior Notes in an aggregate amount of up to $100
million (as such
CUSIP NO. 317928109 13D PAGE 14 OF 18 PAGES
amount may be reduced to reflect a decrease in the principal amount of New
Senior Notes outstanding as a result of repurchases (but not prepayments or
repayments) by the Company) and five percent (5%) of such remaining "available
cash" will be used for distributions to and/or repurchase of stock from Company
stockholders. Contingent interest payments will terminate fifteen (15) years
after the Effective Date of the Plan. The reorganized Board of Directors of the
Company will adopt procedures in connection with any non-pro rata purchase of
Company common stock neither to prefer nor to discriminate against Berkshire and
Leucadia in any such purchases.
As contemplated by the Plan, on the Effective Date, the Company issued the
Shares to Berkadia, representing 50% of the equity of the Company outstanding as
of the Effective Date after giving effect to the common stock issued pursuant to
the Plan, resulting in a total of 122,041,162 shares of Company common stock
being issued and outstanding as of the Effective Date.
The Plan calls for additional Company common stock to be issued to satisfy
final judgments, if any, for plaintiffs in an existing securities litigation
suit against the Company. For all issuances of stock described herein relating
to the securities litigation, holders of allowed claims will receive stock
having a value, as determined by the Bankruptcy Court, equal to the amount of
such claims that was not covered by applicable insurance policies. In the event
that any additional Company common stock is issued, Berkadia shall
contemporaneously receive additional Company common stock in the amount that it
would have received if such issuances had occurred before the Effective Date.
Pursuant to the Plan, the Company's post-confirmation business plan does
not contemplate any new business activities related to new customers. The Plan
provides that while other activities may be initiated or undertaken in the
future, the main objective of the Company's post-confirmation business plan is
to maximize the value of its portfolio through the orderly liquidation of the
portfolio over time.
Pursuant to the Plan, the Certificate of Incorporation of the Company was
amended on the Effective Date, among other things, to prohibit the Company from
issuing non-voting equity securities and to impose certain restrictions on the
transfer of the Company's equity securities, applicable to persons who are or
become (under applicable tax rules) five-percent shareholders of the Company,
without the prior written approval of the Company's Board of Directors. By
resolution of the Company's Board of Directors, these transfer restrictions do
not apply to any of the Shares owned by Berkadia or its affiliates.
Additional information is included in the responses to Items 3 and 6 of
this Schedule 13D, which Items are incorporated herein by reference.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) and (b) Berkadia and Management possess the shared power to vote and
dispose of the Shares, which constitute 50% of the Company's outstanding common
stock. Although Member is a member of Berkadia, Member has no power to vote the
Shares because it has delegated such power to Management under the Berkadia LLC
Operating Agreement described in Item 6. Member does share power to dispose of
the Shares because, except in the event of a liquidation, unanimous approval of
the members of Berkadia and Management is required for the Shares to cease to be
held by Berkadia. As a member of Management, Finance may be deemed to
beneficially own the Shares and to have shared power to vote and dispose of the
Shares. Columbia, BH Columbia, OBH and Berkshire, which are in Finance's chain
of ownership, also may be deemed to beneficially own the Shares and to have
shared power to vote and dispose of the Shares. In addition, as the controlling
person of Berkshire, Mr. Buffett may be deemed to beneficially own such Shares
and to have shared power to vote and dispose of the Shares. Berkadia, Management
and the Berkshire Entities (other than Member) may be deemed to share voting and
dispositive powers with respect to the Shares with Leucadia and the
CUSIP NO. 317928109 13D PAGE 15 OF 18 PAGES
other reporting persons reflected in the Leucadia 13D. Member may be deemed to
share dispositive power with respect to the Shares with Leucadia and the other
reporting persons reflected in the Leucadia 13D. Other than as described above,
none of Berkadia, the Berkshire Entities or Mr. Buffett, nor to their knowledge,
any executive officer or director of Berkadia or the Berkshire Entities, is the
"beneficial owner" of any shares of the Company's common stock, as such term is
defined in Rule 13d-3 under the Exchange Act.
(c) None of Berkadia, Management, the Berkshire Entities or Mr. Buffett
nor, to their knowledge, any executive officer or director of Berkadia,
Management or the Berkshire Entities, has engaged in any transaction in any
shares of the Company's common stock during the sixty day period immediately
preceding the date hereof.
(d) and (e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Berkadia has entered into a Registration Rights Agreement with the Company
by which the Company has granted Berkadia certain rights to obligate the Company
to register for sale under the Securities Act of 1933, as amended, the shares of
Company stock issued to Berkadia or its affiliates in connection with the Plan
(including the Shares). The Registration Rights Agreement is filed as Exhibit 9
hereto, and is incorporated herein by reference.
Berkshire, Leucadia, Berkadia and the Company have entered into a Voting
Agreement by which, among other things, Leucadia and Berkshire agree to cause
Berkadia to vote for the election of the Note Holder Designee. Also under the
Voting Agreement, Leucadia and Berkshire agree to cause Berkadia to vote to
remove the Note Holder Designee if the Unaffiliated Note Holders so direct. The
obligations of Leucadia and Berkshire under the Voting Agreement are subject to
certain termination provisions. The Voting Agreement is filed as Exhibit 10
hereto, and is incorporated herein by reference.
The First Amended and Restated Berkadia LLC Operating Agreement (the
"Berkadia Agreement") provides that except in the event of a liquidation of the
Company or as otherwise unanimously agreed by Berkadia's members, the Company
stock shall be transferred and delivered to, held directly by, and not
distributed by, Berkadia. Under the Berkadia Agreement, Berkadia further agrees
to vote its Company stock in such manner as determined by Management, its
manager, and any directors that Berkadia is entitled to, or has the power to,
elect or otherwise nominate or designate to the Company's Board of Directors,
shall be elected, nominated or designated by Management pursuant to the terms of
the Berkadia Management LLC Operating Agreement described below. The Berkadia
Agreement further provides that Member is entitled to 20% of proceeds from the
Company stock, WMAC Investors, Inc. is entitled to 20% and Management is
entitled to 60% (each being that member's "Member Stock Percentage"). Upon a
liquidation of Berkadia, the Company stock shall be distributed to the members
in-kind in accordance with the Member Stock Percentages. Under the Berkadia
Agreement, unless waived by the members, a liquidation will occur if (among
other things) the Berkadia Loan and the Fleet Facility are paid in full. The
Berkadia Agreement also provides that if a member or its affiliate desires to
acquire additional securities or interests in bank loans of the Company or its
affiliates, then the member or its affiliate may not proceed with such
transaction unless the other member is afforded a reasonable opportunity to
acquire one-half of such securities or interests in bank loans on the same terms
(excluding New Senior Notes acquired through the Tender Offer). The Berkadia
Agreement is filed as Exhibit 11 hereto and is incorporated herein by reference.
Under the Berkadia Management LLC Operating Agreement (the "Management
Operating Agreement"), filed as Exhibit 8 hereto and incorporated herein by
reference, if Berkadia is entitled to, or has power to, elect or otherwise
nominate or designate directors to the Company's Board of Directors, then
Management shall elect, nominate or designate such directors. If the number of
directors to be chosen by Berkadia is an even number, then each of Management's
two members shall choose one-half of such
CUSIP NO. 317928109 13D PAGE 16 OF 18 PAGES
persons. If the number is an odd number, the members shall unanimously agree on
one director and one-half of the remaining directors shall be selected by each
of Management's two members. The Management Operating Agreement also provides
that except in the event of a liquidation of Berkadia, or as otherwise
unanimously agreed by Management's members, the shares of Company stock shall be
transferred and delivered to, held directly by, and not distributed by,
Berkadia. The Management Operating Agreement further provides that Finance is
entitled to 50% of proceeds from the Company stock, and WMAC is entitled to 50%
(each being that member's "Stock Percentage"). Under the Management Operating
Agreement, Management also agrees to vote the shares of Company stock as
required by the Voting Agreement and otherwise as is unanimously agreed by
Management's members; provided that if the members cannot agree, then Management
shall cause Berkadia to vote the shares of Company stock in the manner directed
by each member with respect to that number of Berkadia's shares of Company stock
as is in proportion to such Member's Stock Percentage. The Management Operating
Agreement also provides that if a member or its affiliate desires to acquire
additional securities or interests in bank loans of the Company or its
affiliates, then the member or its affiliate may not proceed with such
transaction unless the other member is afforded a reasonable opportunity to
acquire one-half of such securities or interests in bank loans on the same terms
(excluding New Senior Notes acquired through the Tender Offer).
Berkshire entered into a letter agreement with the Company obligating
Berkshire or one of its subsidiaries to commence the Tender Offer after the
funding of the Berkadia Loan and the issuance of the New Senior Notes. A copy
of the letter agreement is filed as Exhibit 12 hereto, and is incorporated
herein by reference.
Other than as set forth above or otherwise described in this Schedule 13D,
none of Berkadia, Management, the Berkshire Entities or Mr. Buffett nor, to
their knowledge, any executive officer or director of Berkadia, Management or
the Berkshire Entities, has any other contracts, arrangements, understandings or
relationships with any persons with respect to the securities of the Company.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
(1) Executive Officers and Directors of Berkadia, Management and the
Berkshire Entities.
(2A) The Third Amended and Restated Disclosure Statement with Respect to
Joint Plan of Reorganization of Debtors Under Chapter 11 of the Bankruptcy Code,
incorporated herein by reference to Exhibit 10.A to the Company's Current Report
on Form 8-K filed with the SEC on June 22, 2001.
(2B) Revised Technical Amendments to Third Amended and Restated Joint Plan
of Reorganization, dated August 10, 2001, incorporated herein by reference to
Exhibit 2.B to the Company's Current Report on Form 8-K filed with the SEC on
August 27, 2001.
(3) Loan Agreement, dated as of August 21, 2001, by and among Berkadia,
Fleet Securities, Inc. as administrative agent and various lenders named
therein.
(4) Leucadia National Corporation Guaranty to Fleet Securities, Inc., as
administrative agent, and the lenders from time to time party to the Fleet
Facility, dated as of August 21, 2001.
(5) Berkshire Hathaway Inc. Guaranty to Fleet Securities, Inc., as
administrative agent, and the lenders from time to time party to the Fleet
Facility, dated as of August 21, 2001.
(6) Indenture, dated as of August 22, 2001, between the Company and The
Bank of New York, as trustee, with respect to the Company's 7.5% Senior Secured
Notes Maturing 2009 With Contingent Interest Due 2016, including the form of
Senior Secured
CUSIP NO. 317928109 13D PAGE 17 OF 18 PAGES
Note, incorporated herein by reference to Exhibit 10.B to the Company's Current
Report on Form 8-K filed with the SEC on August 27, 2001.
(7) Credit Agreement, dated as of August 21, 2001, by and between FNV
Capital and Berkadia, incorporated herein by reference to Exhibit 10.A to the
Company's Current Report on Form 8-K filed with the SEC on August 27, 2001.
(8) Berkadia Management LLC Operating Agreement, dated August 21, 2001, by
and between Finance and WMAC.
(9) Registration Rights Agreement, dated August 21, 2001, by and between
Berkadia and the Company, incorporated herein by reference to Exhibit 10.I to
the Company's Current Report on Form 8-K filed with the SEC on August 27, 2001.
(10) Voting Agreement, dated August 21, 2001, by and among Berkadia,
Berkshire, Leucadia and the Company, incorporated herein by reference to Exhibit
10.J to the Company's Current Report on Form 8-K filed with the SEC on August
27, 2001.
(11) First Amended and Restated Berkadia LLC Operating Agreement, dated
August 21, 2001, by and among Member, WMAC and Management.
(12) Letter Agreement between Berkshire and the Company, dated June 13,
2001.
(13) Agreement to file the Schedule 13D jointly, as required by Rule 13d-
1(k).
CUSIP NO. 317928109 13D PAGE 18 OF 18 PAGES
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this Statement on Schedule 13D is true,
complete, and correct.
Dated: August 28, 2001
BERKADIA LLC
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: President
BERKADIA MANAGEMENT LLC
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: President
BHF BERKADIA MEMBER, INC.
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: President
BH FINANCE LLC
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: President
COLUMBIA INSURANCE COMPANY
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: Treasurer
BH COLUMBIA INC.
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: President
OBH, Inc.
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: Vice President
BERKSHIRE HATHAWAY INC.
By: /s/ Marc D. Hamburg
_________________________
Name: Marc D. Hamburg
Title: Vice President and
Chief Financial Officer
WARREN E. BUFFETT
/s/ Warren E. Buffett
_________________________