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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[ x ] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the fiscal year ended December 31, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number: 1-14116
CONSUMER PORTFOLIO SERVICES, INC.
(Exact name of registrant as specified in its charter)
California 33-0459135
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2 Ada, Irvine, California 92618
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code: (714) 753-6800
Securities registered pursuant to section 12(b) of the Act:
Title of each class: Rising Interest Subordinated Redeemable
Securities due 2006
Name of each exchange on which registered: New York Stock Exchange
Securities registered pursuant to section 12(g) of the Act: Common
stock, no par value
Indicate by check mark whether the registrant (1) filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act during
the past 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes / x / No / /
Indicate by check mark if there is no disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. / /
The aggregate market value on March 27, 1996 (based on the $8.00 average
of closing bid and asked prices on Nasdaq Stock Market on that date) of
the voting stock beneficially held by non-affiliates of the registrant
was $72,793,112. The number of shares of the registrant's Common
Stock outstanding on March 27, 1997 was 13,779,442
DOCUMENTS INCORPORATED BY REFERENCE: The Registrant's proxy statement
for its 1997 annual meeting of shareholders is incorporated by reference
into Part III of this report.
Part I
ITEM 1. BUSINESS
A description of the business of Consumer Portfolio Services, Inc. (the
"Registrant" or the "Company") appears as pages 31 through 47 of the preliminary
prospectus ("Preliminary Prospectus") included in amendment number 3 to the
registrant's registration statement, file number 333-21289, as filed with the
Securities and Exchange Commission on March 28, 1997. Such description is
incorporated herein by reference.
ITEM 2. PROPERTY
The information appearing at page 47 of the Preliminary Prospectus under
the caption "Property" is incorporated herein by reference.
ITEM 3. LEGAL PROCEEDINGS
As of the date of this report, the registrant is not involved in any
material litigation in which it is the defendant. The registrant
regularly initiates legal proceedings as a plaintiff in connection with
its routine collection activities.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The information appearing at page 18 of the Preliminary Prospectus under the
caption "Price Range of Common Stock and Dividend Policy" is incorporated herein
by reference.
ITEM 6. SELECTED FINANCIAL DATA
The information appearing at pages 20 and 21 of the Registration Statement under
the caption "Selected Consolidated Financial Data" is incorporated herein by
reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The text appearing at pages 22 through 30 of the Preliminary Prospectus under
the caption "Management's Discussion and Analysis of Financial Condition and
Results of Operations" is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information appearing at page 68 of the Preliminary Prospectus and pages F-1
through F-25 of the Preliminary Prospectus, comprising an index to Consolidated
Financial Statements, an Independent Auditors' Report, Consolidated Financial
Statements and Notes thereto, is incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
Information regarding directors of the registrant is incorporated by reference
to the registrant's definitive proxy statement for its annual meeting of
shareholders to be held in 1997 (the "1997 Proxy Statement"). The 1997 Proxy
Statement will be filed not later than April 30, 1997. Information regarding
executive officers of the registrant is incorporated by reference to the
information appearing on pages 48 through 50 of the Preliminary Prospectus under
the caption "Management."
ITEM 11. EXECUTIVE COMPENSATION
Incorporated by reference to the 1997 Proxy Statement.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Incorporated by reference to the 1997 Proxy Statement.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Incorporated by reference to the 1997 Proxy Statement.
PART IV
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
The following exhibits are filed as part of this report:
Exhibit
No.
Exhibit 3.1 Restated Articles of Incorporation of the Company, as
amended on December 13, 1993, and March 7, 1996.(A)
Exhibit 3.2 Amended and Restated By-Laws of the Company, adopted
November 30, 1993. (B)
Exhibit 4.1 The Indenture dated December 15, 1995, between Consumer
Portfolio Services, Inc., and Harris Trust and Savings Bank. (E)
Exhibit 4.2 First Supplemental Indenture dated December 15, 1995,
between Consumer Portfolio Services, Inc., and Harris Trust and Savings
Bank. (E)
Exhibit 10.1 1991 Stock Option Plan as amended on April 27, 1994, and
forms of Stock Option Agreement. (B)
Exhibit 10.2 Lease Agreement dated February 14, 1991 between Holdings
and Irvine Technology Partners ("ITP"), First Amendment to Lease dated as
of June 26, 1992 by and among ITP, Holdings and the Company and
Assignment and Assumption of Lease dated April 1, 1992 by and between
Holdings and the Company. (C)
Exhibit 10.3 Amendment #2, dated January 17, 1995, between ITP and
Consumer Portfolio Services, Inc., to Lease Agreement dated February 14,
1991, between Holdings and Irvine Technology Partners ("ITP"), First
Amendment to Lease dated as of June 26, 1992, by and among ITP, Holdings
and the Company and Assignment and Assumption of Lease dated April 1,
1992, by and between Holdings and the Company.(D)
Exhibit 10.4 Form of Automobile Dealer Agreement between the Company
and its Dealers and the related Assignment. (C)
Exhibit 10.5 Consulting Agreement dated February 14, 1996, by and
between the Company and Stanwich Partners, Inc.(A)
Exhibit 10.6 The Receivables Funding and Servicing Agreement, dated
June 1, 1995, between Consumer Portfolio Services, Inc., CPS Funding
Corp., Redwood Receivables Corporation and General Electric Capital
Corporation.(A)
Exhibit 10.7 Amended and Restated Motor Vehicle Installment Contract
Loan and Security Agreement, dated June 1, 1995, between Consumer
Portfolio Services, Inc., and General Electric Capital Corporation.(A)
Exhibit 10.8 Agreement and Plan of Merger, dated August 30, 1995,
between Consumer Portfolio Services, Inc., and CPS Holdings, Inc. (F)
Exhibit 10.9 Promissory Note, dated September 27, 1995, made by the
Company in favor of Charles E. Bradley, Sr., in the aggregate principal
amount of $2,000,000.(A)
Exhibit 10.10 Promissory Note, dated July 6, 1995, made by the Company
in favor of SunAmerica, Inc., in the aggregate principal amount of
$2,000,000.(A)
Exhibit 10.11 Lease Agreement dated December 9, 1996 between the Company
and The Prudential Insurance Company of America, relating to the
Company's branch facility in Chesapeake, Virginia.
Exhibit 11.0 Statement re Computation of Per Share Earnings.
Exhibit 21.1 Subsidiaries of the Company.
Exhibit 23.1 Consent of independent auditors.
Exhibit 24. Director Powers of Attorney.
Exhibit 27. Financial Data Schedule.
Exhibit 99.1 Pages 18, 20 through 47, 68 and F-1 through F-25 of the
preliminary prospectus included in registrant's registration statement on Form
S-3, file number 333-21289, amendment number 3 thereto, as filed March 28, 1997.
____________________
A. Previously filed as an exhibit to the Company's Form 10-KSB for the
transition period ended December 31, 1995, and incorporated herein by
reference.
B. Previously filed as an exhibit to the Company's Form 10-KSB for the
fiscal year ended March 31, 1994, and incorporated herein by reference.
C. Previously filed as an exhibit to the Company's Registration Statement
on Form S-1, No. 33-49770, as amended, and incorporated herein by
reference.
D. Previously filed as an exhibit to the Company's Form 10-KSB for the
fiscal year ended March 31, 1995, and incorporated herein by reference.
E. Previously filed as an exhibit to the Company's Form 8-K, filed on
December 26, 1995, and incorporated herein by reference.
F. Previously filed as an exhibit to the Company's Proxy Statement for
the September 26, 1995, Annual Meeting, and incorporated herein by
reference.
(b) Reports on Form 8-K
During the last quarter of the fiscal year ended December 1996, two reports on
Form 8-K were filed by the Company. Each of such two reports included
responses to Items 5 and 7 of Form 8-K relating to "Other Information,"
and "Financial Statement and Exhibits," respectively. No financial
statements were filed with either of such reports on Form 8-K. Each of
such two reports related to the Company's December 1996 sale of Contracts
in a securitization transaction.
The first of the two reports, dated December 19, 1996 and filed December
23, 1996, filed the forms of Underwriting Agreement, Pooling and
Servicing Agreement and Receivables Purchase Agreement relating to that
transaction, and the second, dated December 11, 1996 and filed December
19, 1996, filed computational materials relating to the securitization
transaction.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
CONSUMER PORTFOLIO SERVICES, INC.
(Registrant)
* /s/Jeffrey P. Fritz Date: March 28, 1997
Jeffrey P. Fritz
Sr. Vice President and Chief Financial Officer
Pursuant to the requirements of the Securities and Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
* /s/ Date: March 28, 1997
Charles E. Bradley, Sr.
Chairman of the Board
* /s/ Date: March 28, 1997
Charles E. Bradley, Jr.
Director, President and Chief Executive Officer
(Principal Executive Officer)
* /s/ Date: March 28, 1997
William B. Roberts
Director
* /s/ Date: March 28, 1997
John G. Poole
Director
* /s/ Date: March 28, 1997
Thomas L. Chrystie
Director
Date:
Robert A. Simms
Director
/s/ Jeffrey P. Fritz Date: March 28, 1997
Jeffrey P. Fritz
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
* /s/ Jeffrey P. Fritz Date: March 28, 1997
By Jeffrey P. Fritz, Attorney-in-fact
EXHIBIT INDEX
The following exhibits are filed herewith:
Exhibit 10.11 Lease Agreement dated December 9, 1996 between the Company
and The Prudential Insurance Company of America, relating to the
Company's branch facility in Chesapeake, Virginia.
Exhibit 11.0 Statement re Computation of Per Share Earnings.
Exhibit 21.1 Subsidiaries of the Company.
Exhibit 23.1 Consent of independent auditors.
Exhibit 24. Director Powers of Attorney.
Exhibit 27. Financial Data Schedule.
Exhibit 99.1 Pages 18, 20 through 47, 68 and F-1 through F-25 of the
preliminary prospectus included in registrant's registration statement on Form
S-3, file number 333-21289, amendment number 3 thereto, as filed March 28, 1997.