Attached files
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| EX-10.1 - EXHIBIT 10.1 - PERFORMANCE CAPITAL MANAGEMENT LLC | ex10_1.htm |
UNITED
STATES
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): January 15,
2010
Performance
Capital Management, LLC
(Exact
name of registrant as specified in its charter)
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California
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0 –
50235
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03-0375751
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(State
or other
Jurisdiction
of
incorporation)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
No.)
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7001
Village Drive, Suite 255
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Buena
Park, California
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90621
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (714)
736-3790
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:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 1.01. Entry Into a
Material Definitive Agreement.
Sale
of Performance Capital Management, LLC Portfolios
On
January 15, 2010, Performance Capital Management, LLC (the “Company”) entered
into an Account Purchase Agreement (“Agreement”) with Oliphant Financial Group,
LLC, a Florida limited liability company (“Oliphant”), which was approved by the
Company’s Board of Directors on January 14, 2010, to sell all of the Company’s
loan portfolios, “as is”, to Oliphant for a purchase price of $925,000. The
Agreement also provides that Oliphant shall receive all collections revenue
on the loan accounts being purchased that was generated from December 1, 2009
through January 15, 2010, the closing date of the sale. This amount, totaling
approximately $113,000, remained with the Company as a deposit on the purchase
price. Oliphant paid the Company the balance of approximately $812,000 in cash.
The Agreement includes a mutual indemnification and hold harmless provision that
will survive the execution and delivery of the loan account transfer documents.
A copy of the Agreement is attached hereto as Exhibit 10.1 and incorporated
herein by reference, and the foregoing disclosure is qualified in its entirety
by reference to the Agreement.
Item
1.02. Termination of a Material Definitive Agreement.
With the
sale of all of the Performance Capital Management, LLC (the “Company”) loan
portfolios to Oliphant Financial Group, LLC, a Florida limited liability company
(“Oliphant”), the Agency Service Agreement between the Company and Oliphant
dated January 11, 2010 was terminated effective January 15, 2010, the
closing date of the sale.
Item
2.01. Completion of Acquisition or Disposition of Assets
On
January 15, 2010, Performance Capital Management, LLC (the “Company”) entered
into an Account Purchase Agreement with Oliphant Financial Group, LLC, a Florida
limited liability company (“Oliphant”), to sell all of its portfolios to
Oliphant for $925,000. The closing of the sale was January 15, 2010. For
additional disclosure regarding the sale of the Company’s portfolios to
Oliphant, see Item 1.01, Entry Into a Material Definitive Agreement, in this
Report on Form 8-K above, which disclosure is incorporated herein by
reference.
Item
8.01. Other Events.
Legal
Proceedings
On
January 22, 2010, Performance Capital Management, LLC (the “Company”) agreed to
settle a lawsuit with Mark Palmer, a plaintiff who filed a lawsuit against the
Company in November 2009 in the United States District Court for the District of
Connecticut, for $3,900 and a release from the debt that he owes to the
Company.
Estimated
Liquidating Distributions
The net
proceeds to Performance Capital Management, PLLC (the “Company”) from the sale
of the Matterhorn Financial Services, LLC (“Matterhorn”) loan portfolios and the
Company’s loan portfolios was estimated to be $1,432,000 on December 15, 2009,
as disclosed in the Company’s definitive proxy statement (“Proxy Statement”)
filed with the SEC on January 12, 2010 and posted on the Company’s web site at:
http://www.cfpproxy.com/9101sm. The actual net proceeds received by the Company
from the sale of the portfolios were approximately $1,425,000. The sale of the
Company’s portfolios is disclosed in this report on Form 8-K under Item 1.01,
Entry Into a Material Definitive Agreement. The sale of the Matterhorn
portfolios was disclosed in a report on Form 8-K dated January 7, 2010 and filed
with the SEC on January 13, 2010. With the
sale of the Company’s and Matterhorn’s portfolios, the Company will not receive
any further servicing fees or revenues from portfolio collections, with the
exception of potential payments from accounts held back from the sales,
including those that are the subject of pending lawsuits against the Company or
a bankruptcy order.
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The net
proceeds received from the sale of the Company’s loan portfolios to Oliphant are
being held in a separate bank account pending the vote by the Company’s members
of record as of December 31, 2009 (“Members”) on the Board’s proposal
to dissolve the Company contained in the Proxy Statement. The deadline for
Members to submit their consents or revoke their consents is February
19, 2010. If the members approve the dissolution and liquidation of the Company,
the proceeds will be distributed as provided in the Plan of Dissolution, a copy
of which is attached to the Proxy Statement. If the Members vote against the
proposal to dissolve the Company or there are insufficient votes submitted to
take action, the Board will seek a decree of judicial dissolution pursuant
to California state law and distribute any remaining assets to the members and
economic interest owner (together, “Unit Holders”), and/or file for bankruptcy,
depending upon the circumstances.
The
proceeds from the sale of the Matterhorn portfolios are being used to settle
amounts owing to creditors, including the termination fee in connection with the
termination of the office lease, and to pay ongoing business
expenses.
While the
actual amount of the Company’s future liabilities, other obligations and
expenses and claims against it is unknown, the Board has taken steps to preserve
the value of the Company’s assets and reduce its expenses while awaiting a vote
by the Members. At the time of this filing, the Company believes that available
cash will be adequate to provide for the satisfaction of its liabilities, other
obligations and expenses and claims against it and that it will make one or more
cash distributions to its Unit Holders.
The
amount the Company estimates it will distribute to its Unit Holders remains
at between $0.16 to $0.61 per unit (based on 548,443 total units outstanding),
as disclosed in the Proxy Statement. This estimated liquidating distribution
range assumes that the dissolution and liquidation of the Company pursuant to
the Plan of Dissolution will be approved and ratified by the Members and that
there will be assets remaining after all claims, liabilities and expenses (such
as salaries and benefits, severance, directors’ and officers’ insurance, payroll
and local taxes, legal and accounting fees and miscellaneous office expenses)
are paid.
The
Company will continue to defend any pending lawsuits and pay any claims,
liabilities and expenses following approval of the dissolution of the Company
pursuant to the Plan of Dissolution. Such claims, if not settled, may continue
for up to 4 years following the Effective Date. Satisfaction of these claims,
liabilities and expenses will reduce the amount of assets available for ultimate
distribution to Unit Holders. Any contingency reserve established by the
Company’s Board as a setoff against these amounts will be deducted before the
determination of amounts available for distribution to Unit Holders. To the
extent that the amount of the Company’s liabilities or the
amounts that the Company expends during the liquidation are greater than the
contingency reserve, the Unit Holders may receive substantially less than
the amount currently estimated, or no distribution.
Solicitation
of Member Votes
As
described in the Company’s definitive proxy statement filed with the SEC on
January 12, 2010, the Company is soliciting votes from the Members to
take action by written consent, in lieu of a special meeting of the Members, on
a proposal to approve and ratify the dissolution and liquidation of the Company.
If such approval is received, the Company intends to proceed with an orderly
dissolution of the Company pursuant to the Plan of Dissolution, and cease its
reporting obligations under the Securities Exchange Act of 1934, as
amended.
A CONSENT
THAT HAS BEEN DELIVERED TO THE COMPANY MAY BE REVOKED BY THE MEMBER GIVING IT BY
SIGNING AND DELIVERING A NEW CONSENT TO THE COMPANY BEARING A LATER DATE, OR BY
DELIVERING A WRITTEN NOTICE OF REVOCATION TO THE COMPANY.
A copy of
the Consent is being mailed to you on or about January 22, 2010. Or you may
access and print a copy of the Consent on the Company’s web site at http://www.cfpproxy.com/9101sm.
A Consent or revocation of a Consent may delivered to the Company
by:
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·
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mailing
it to Mr. David Caldwell, Performance Capital Management, LLC, 7001
Village Drive, Suite 255, Buena Park, California 90621;
or
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·
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scanning
and sending it by email to: members@pcmllc.us;
or
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·
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faxing
it to the attention of Mr. David Caldwell at
1-714-736-3733.
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The
deadline for delivering Consents and revocations of Consents to the Company is
5:00 p.m. PT on Friday, February 19, 2010.
The
Board strongly urges each Member to complete, sign and deliver a Consent as soon
as possible to ensure that sufficient Member units are submitted for the Members
to take action on the proposal.
ADDITIONAL
INFORMATION AND WHERE TO FIND IT
The
disclosure in this report on Form 8-K is incorporated by reference in the
definitive proxy statement filed by the Company with the SEC on January 12,
2010. Members are urged to read the definitive proxy statement and other
relevant materials filed by the Company with the SEC carefully, including this
Report on Form 8-K, because they contain important information about the
Company, the proposal and related matters. Members may obtain free copies of the
consent solicitation documents filed with the SEC on the Company’s web site at:
http://www.cfpproxy.com/9101SM. Members may also request a copy of any document
posted on the Company’s web site by writing to Performance Capital Management,
LLC, 7001 Village Drive, Suite 255, Buena Park, California 90621, Attn: David J.
Caldwell or by calling 1-714-736-3790 or toll-free 1-800-757-7700, extension
0.
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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 (the
“Company”). 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 the Company’s other reports filed with the
Securities and Exchange Commission that attempt to advise interested parties of
the risks and factors that may affect the
Company’s business.
Item
9.01. Financial Statements and Exhibits.
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Exhibit
No.
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Description
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Account
Purchase Agreement by and between Performance Capital Management, LLC and
Oliphant Financial Group, LLC dated January 15,
2010.
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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.
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PERFORMANCE
CAPITAL MANAGEMENT, LLC
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January
22, 2010
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By:
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/s/
David J. Caldwell
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(Date)
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David
J. Caldwell
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Its:
Chief Operations Officer
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