-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CZGhsYjF9AswmTBlvOEY4NuY7zNGf7SaChB33OSVWxQHYT7utY0rM9fcib0zYQdB tjxqN2g1kNppMPuja4d5Sg== 0000950147-97-000375.txt : 19970603 0000950147-97-000375.hdr.sgml : 19970603 ACCESSION NUMBER: 0000950147-97-000375 CONFORMED SUBMISSION TYPE: 424B2 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19970602 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FINOVA CAPITAL CORP CENTRAL INDEX KEY: 0000043960 STANDARD INDUSTRIAL CLASSIFICATION: SHORT-TERM BUSINESS CREDIT INSTITUTIONS [6153] IRS NUMBER: 941278569 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B2 SEC ACT: 1933 Act SEC FILE NUMBER: 033-63343 FILM NUMBER: 97617507 BUSINESS ADDRESS: STREET 1: 1850 N CENTRAL AVE STREET 2: PO BOX 2209 CITY: PHOENIX STATE: AZ ZIP: 85004-2209 BUSINESS PHONE: 6022074900 MAIL ADDRESS: STREET 1: 1850 N. CENTRAL AVENUE STREET 2: P.O. BOX 2209 CITY: PHOENIX STATE: AZ ZIP: 85002-2209 FORMER COMPANY: FORMER CONFORMED NAME: GREYHOUND FINANCIAL CORP DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: GREYHOUND LEASING & FINANCIAL CORP DATE OF NAME CHANGE: 19870330 424B2 1 FORM 424B2 Prospectus Supplement FINOVA - --------------------- (To Prospectus dated May 28, 1997) $100,000,000 FINOVA Capital Corporation 7.40% Notes Due 1850 N. Central Avenue June 1, 2007 P.O. Box 2209 Phoenix, Arizona 85002-2209 - -------------------------------------------------------------------------------- TERMS OF NOTES o Interest paid on June 1 and o Global security held by The December 1, accruing from the date Depository Trust Company, we issue the Notes. generally. o First interest payment date on o No redemption before maturity. No December 1, 1997. sinking fund. For more details, see "Note Terms" and "Description of the Securities." TERMS OF SALE UNDERWRITING PRICE TO DISCOUNTS AND PROCEEDS TO PUBLIC(1) COMMISSIONS FINOVA(2) ------------- --------------- ------------- Per Note .............. 99.735 0.625 99.11% Total ................. $99,735,000 $625,000 $99,110,000 - ------------------ (1) Plus accrued interest, if any, from date of issuance. (2) Before expenses payable by us estimated at $150,000. The Notes have not been approved or disapproved by the SEC or any state securities commission. None of those authorities has determined that the Prospectus or this Supplement is accurate or complete. Any representation to the contrary is Book entry delivery of Notes expected a criminal offense. on June 2, 1997, subject to conditions. CITICORP SECURITIES, INC. May 28, 1997 FINOVA CAPITAL CORPORATION FINOVA Capital Corporation, FINOVA's principal lines of formerly known as Greyhound Financial business are detailed more fully in Corporation ("FINOVA" or "us"), is a the Prospectus. Those lines include: financial services company that provides collateralized financing and o Commercial Equipment Finance leasing products to commercial enterprises in focused market niches, o Commercial Finance principally in the U.S. We concentrate on lending to midsize o Commercial Real Estate Finance businesses and have been in operation for over 42 years. o Communications Finance FINOVA extends revolving credit o Corporate Finance facilities, term loans, and equipment and real estate financing to o Factoring Services "middle-market" businesses with financing needs falling generally o Franchise Finance between $500,000 and $35 million. We also offer sales financing programs o Healthcare Finance to manufacturers, distributors, vendors and franchisors to help o Inventory Finance facilitate sales of their products to customers. o Portfolio Services We operate in 15 specific industry o Public Finance or market niches in which our expertise in evaluating the o Rediscount Finance creditworthiness of prospective customers and our ability to provide o Resort Finance value-added services enable us to differentiate ourselves from our o Transportation Finance/Capital competitors. That expertise and Services ability also enable us to command product pricing that provides a o FINOVA Investment Alliance satisfactory spread over our borrowing costs. NOTE TERMS The following description October 1, 1995, between us and The supplements the "Description of the Bank of New York (as successor to Securities" section in the First Interstate Bank of Arizona, Prospectus. The Notes are to be N.A.), as Trustee. issued as a separate series of securities under the Indenture dated as of Maximum Amount: $100,000,000 principal amount Maturity: June 1, 2007 Interest Rate: 7.40% per year Interest Payment Dates: June 1 and December 1, accruing from the date we issue the Notes. First interest payment date is December 1, 1997. Interest Calculations: Based on a 360-day year of twelve 30-day months Redemption or Sinking Fund: None Form of Note One global security, held in the name of The Depository Trust Company, generally Settlement and Payment Same-day -- immediately available funds Secondary Trading Payments Same-day -- immediately available funds S-2 UNDERWRITING We have entered into an Notes to certain dealers at that Underwriting Agreement dated May 28, price less a concession of 0.40%. The 1997 with Citicorp Securities, Inc., Underwriter or those dealers may as Underwriter. The agreement allow a discount of 0.25% on sales to provides that the Underwriter will certain other dealers. After the purchase from us all of the Notes if initial public offering of the Notes, any of the Notes are purchased. It the Underwriter may change the public need not purchase any Notes unless offering price, concession to dealers certain conditions are satisfied. We and discount. have agreed to indemnify the Underwriter against certain liabilities, including civil The Notes are a new issue of liabilities under the Securities Act securities with no established of 1933, or to contribute to payments trading market. The Underwriter has which the Underwriter may be required advised us that it intends to act as to make for those liabilities. a market maker for the Notes. It is not obligated to do so, however, and The Underwriter advises us that it it may discontinue any market making proposes to offer the Notes to the at any time without notice. Neither public initially at the offering we nor the Underwriter can assure the price set forth on the cover page of liquidity of any trading market for this Supplement. It may offer the the Notes. NOTICE TO CANADIAN RESIDENTS RESALE RESTRICTIONS result, you would have to rely on The Notes will not be qualified other available remedies, including for distribution under the Canadian common law or U.S. law rights of securities laws, including the action for damages or rescission. qualification requirements of each province where sales of Notes are All of our directors and officers, made. Any resales of Notes in Canada and the experts named in the must comply with those laws, or an Prospectus, as well as our or their exemption from those laws, which will assets, may be located outside of vary depending on the relevant Canada. As a result, you may not be jurisdiction. You are advised to seek able to effect service of process legal advice prior to any purchase or within Canada on us or them. It may resale of the Notes. not be possible to satisfy a judgment against us or them in Canada or to REPRESENTATIONS OF PURCHASERS enforce a judgment obtained in Canadian courts outside of Canada. If you are a purchaser of Notes in Canada and you receive a purchase NOTICE TO BRITISH COLUMBIA RESIDENTS confirmation, you will be deemed to represent to us, the Underwriter and If you are a purchaser of Notes your dealer that you are entitled and if the Securities Act (British under provincial securities laws to Columbia) applies, we advise you that purchase the Notes without the you are required to file a report benefit of a prospectus qualified with the British Columbia Securities under the securities laws of Canada. Commission within 10 days of the sale If required by law, you will also of any Notes acquired by you under represent that you are purchasing the this offering. The report must be in Notes as a principal and not as an the form attached to that agent. You will also represent that commission's Blanket Order #95/17, a you have reviewed the text above copy of which may be obtained from us under "Resale Restrictions." If you or the Underwriter. You need only are purchasing the Notes in British file one report for Notes acquired on Columbia, you will also represent the same day under the same that you are not purchasing them as prospectus exemption. an individual. TAXATION AND ELIGIBILITY FOR RIGHTS OF ACTION (ONTARIO PURCHASERS) INVESTMENT The Notes are offered by a foreign You should consult your own legal issuer, so the contractual rights of and tax advisors about the action prescribed by section 32 of consequences of investing in the the Regulation under Securities Act Notes in your circumstances and (Ontario) will not apply to you if whether you are eligible to buy them you are an Ontario purchaser. As a under Canadian law. S-3 Prospectus - ---------- FINOVA FINOVA CAPITAL CORPORATION SENIOR DEBT SECURITIES We may offer from time to time securities in one or more series, under this Prospectus up to $1.5 with the same or various maturities, billion principal amount of our at or above par or with original senior debt securities ("securities") issue discount, and in fully on terms to be determined at the time registered form or the form of one or of sale. We may issue the more global securities. PROSPECTUS SUPPLEMENT The Supplement to the Prospectus also add, update or change for each offering of securities will information contained in this contain the specific information and Prospectus. It is important that you terms for that offering. The read both this Prospectus and the Supplement may Supplement before you invest. --------------- The securities have not been approved or disapproved by the SEC or any state securities commission. We may offer the securities directly None of those authorities has or through underwriters, agents or determined that this Prospectus is dealers. The Supplement will describe accurate or complete. the terms of that plan of distribution. "Plan of Distribution" Any representation to the contrary is below also provides more information a criminal offense. on this topic. May 28, 1997 May 28, 1997 CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES OFFERED UNDER THIS PROSPECTUS. THOSE TRANSACTIONS INCLUDE OVER-ALLOTMENT, STABILIZING TRANSACTIONS, SHORT COVERING TRANSACTIONS AND PENALTY BIDS. FOR A DESCRIPTION OF THOSE ACTIVITIES, SEE "PLAN OF DISTRIBUTION" IN THE PROSPECTUS. IF BEGUN, THEY MAY DISCONTINUE THOSE ACTIVITIES AT ANY TIME. WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and curities Exchange Act of 1934 until current reports, proxy statements and this offering is completed: other information with the SEC. You may read and copy any document we o Annual Report of Form 10-K for file at the SEC's public reference the year ended December 31, rooms in Washington, D.C., New York, 1996. New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 o Portions of our Proxy Statement for more information on the public on Schedule 14A for the Annual reference rooms and their copy Meeting of Shareholders held on charges. Our SEC filings are also May 8, 1997 that have been available to the public from the incorporated by reference into SEC's web site at http://www.sec.gov. our 10-K. You may also inspect our SEC reports and other information at the New York o Quarterly Report on Form 10-Q Stock Exchange, 20 Broad Street, New for the quarter ended March 31, York, New York 10005. 1997. The SEC allows us to "incorporate o Current Report on Form 8-K dated by reference" the information we file April 18, 1997. with them, which means we can disclose information to you by You may request a copy of those referring you to those documents. filings, other than exhibits, at no Information incorporated by reference cost, by contacting us at: is part of this Prospectus. Later information filed with the SEC Treasurer updates and supersedes this FINOVA Capital Corporation Prospectus. 1850 N. Central Avenue P.O. Box 2209 We incorporate by reference the Phoenix, Arizona 85002-2209 documents listed below and any future (602) 207-6900 filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Se- FINOVA CAPITAL CORPORATION FINOVA Capital Corporation, worthiness of prospective customers formerly known as Greyhound Financial and our ability to provide Corporation ("FINOVA" or "us"), is a value-added services enable us to financial services company that differentiate ourselves from our provides collateralized financing and competitors. That expertise and leasing products to commercial ability also enable us to command enterprises in focused market niches, product pricing that provides a principally in the U.S. We satisfactory spread over our concentrate on lending to midsize borrowing costs. businesses and have been in operation for over 42 years. We seek to maintain a high quality portfolio and to minimize non-earning FINOVA extends revolving credit assets and write-offs. We use clearly facilities, term loans, and equipment defined underwriting criteria and and real estate financing to stringent portfolio management "middle-market" businesses with techniques. We diversify our lending financing needs falling generally activities geographically and among a between $500,000 and $35 million. We range of industries, customers and also offer sales financing programs loan products. to manufacturers, distributors, vendors and franchisors to help Due to the diversity of our facilitate sales of their products to portfolio, we believe we are better customers. able to manage competitive changes in our markets and to withstand the We operate in 15 specific industry impact of deteriorating economic or market niches in which our conditions on a regional or national expertise in evaluating the credit- basis. There can be no assurance, however, that com 2 petitive changes, borrowers' and service providers. The group performance, economic conditions or extends revolving credit other factors will not result in an facilities and term loans adverse impact on our results of secured by the assets of the operations or financial condition. borrower, with significant emphasis on the borrower's cash FINOVA generates interest and flow as the source of repayment other income through charges assessed of the secured loan. on outstanding loans, loan servicing, leasing and other fees. Our primary o FACTORING SERVICES provides full expenses are the costs of funding our service factoring and accounts loan and lease business, including receivable management services interest paid on debt, provisions for for entrepreneurial and larger possible credit losses, marketing firms, operating primarily in expenses, salaries and employee the textile and apparel benefits, servicing and other industries. The annual factored operating expenses and income taxes. volume of these companies is generally between $5 million and LINES OF BUSINESS $25 million. We operate the following principal o FRANCHISE FINANCE offers lines of business: equipment, real estate and acquisition financing programs o COMMERCIAL EQUIPMENT FINANCE for operators of established offers equipment leases, loans franchise concepts. We typically and "turnkey" financing to the purchase the equipment leased to supermarket, manufacturing, the ultimate end-user from the packaging and general aviation manufacturer, vendor or dealer industries. Typical transaction selected by the end-user. sizes are $500,000 to $15 Transaction sizes generally million. range from $500,000 to $15 million. o COMMERCIAL FINANCE offers collateral- oriented revolving o HEALTHCARE FINANCE offers a full credit facilities and term loans range of equipment and real for manufacturers, distributors, estate financing and asset wholesalers and service management services for the companies. Typical transaction health care industry, targeting sizes range from $500,000 to $3 middle market health care million. providers in the U.S. Transaction sizes typically o COMMERCIAL REAL ESTATE FINANCE range from $500,000 to $25 provides cash-flow-based million. financing primarily for acquisitions and refinancings to o INVENTORY FINANCE provides experienced real estate inventory financing, combined developers and owner/occupants inventory/accounts receivable of income-producing properties lines of credit and purchase in the U.S. We concentrate on order financing for equipment secured financing opportunities, distributors, value-added generally between $5 million and resellers and dealers. $25 million, involving senior Transaction sizes generally mortgage term loans on range from $500,000 to $30 owner-occupied commercial real million. estate. We also manage our portfolio of real estate o PORTFOLIO SERVICES provides leveraged leases in this line of customized receivable servicing business. and collections for timeshare developers and other generators o COMMUNICATIONS FINANCE of consumer receivables, which specializes in radio and can simplify their loan television financing. Other administration and cash markets include cable management functions. television, print and outdoor media services in the U.S. We o PUBLIC FINANCE provides extend secured loans to primarily tax-exempt financing communications businesses to state and local governments requiring funds for and non-profit corporations. recapitalizations, refinancings Typical transaction sizes range or acquisitions. Loan sizes from $100,000 to $5 million. generally range from $1 million to $40 million. o REDISCOUNT FINANCE offers $1 million to $35 million revolving o CORPORATE FINANCE provides credit lines to regional financing, generally in the consumer finance companies, range of $2 million to $40 which in turn extend credit to million, focusing on middle consumers. Our customers provide market businesses nationally. credit to consumers to finance Typical industries served home improvements, automobile include distribution, wholesale, purchases, insurance premiums specialty retail, manufacturing and a variety of other financial needs. o RESORT FINANCE focuses on successful, experienced resort developers, primarily of timeshare resorts, second home communities, golf 3 resorts and resort hotels. through our London, England Extending funds through a office. Our Capital Services variety of lending options, we activities also provide provide loans and lines of leveraged lease financing on credit ranging from $5 million transportation equipment. to $30 million for construction, acquisitions, receivables o FINOVA INVESTMENT ALLIANCE financing and purchases and provides or intends to provide other uses. Through our equity and mezzanine debt Portfolio Services Operations, financing for midsize businesses we offer expanded convenience in partnership with and service to our customers. institutional investors and selected fund sponsors. Typical o TRANSPORTATION FINANCE/CAPITAL transaction sizes range from $2 SERVICES structures secured million to $15 million. financings for specialized areas of the transportation industry, FINOVA Capital Corporation, a principally involving domestic Delaware corporation, was and foreign used aircraft, some incorporated in 1965 and is the new aircraft, domestic successor to a California corporation short-line railroads and new and that was formed in 1954. Our used rail equipment. Typical principal executive offices are transactions range from $5 located at 1850 N. Central Avenue, million to $30 million and P.O. Box 2209, Phoenix, Arizona involve financing up to 80% of 85002-2209. Our telephone number is the fair market value of used (602) 207-6900. All of our capital equipment. We also serve as stock is owned by The FINOVA Group equity participants in leveraged Inc. whose stock is traded on the New lease transactions. We have been York Stock Exchange. active in international aircraft lending and leasing since 1992 RATIO OF INCOME TO FIXED CHARGES
THREE MONTHS ENDED MARCH 31, YEAR ENDED DECEMBER 31, - --------- -------------------------------- 1997 1996 1995 1994 1993 1992 - ---- ---- ---- ---- ---- ---- 1.54 1.50 1.44 1.58 1.50 1.37
Variations in interest rates Income available for fixed charges, generally do not have a substantial for purposes of computing the above impact on the ratio because ratios, consists of income from fixed-rate and floating-rate assets continuing operations before income are generally matched with taxes plus fixed charges. Fixed liabilities of similar rate and term. charges consist of interest and related debt expense, and a portion of rental expense determined to be representative of interest. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Some of the statements contained our efforts to implement our business in this Prospectus and any strategy, the effect of economic Supplements, including information conditions, the performance of our incorporated by reference, discuss borrowers, actions of our competitors future expectations, contain and our ability to respond to those projections of results of operation actions, the cost of our capital, or financial condition or state other which may depend in part on our forward-looking information. Known portfolio quality, ratings, prospects and unknown risks, uncertainties and and outlook, changes in governmental other factors could cause the actual regulation, tax rates and similar results to differ materially from matters, the results of litigation, those contemplated by those the ability to attract and retain statements. The forward-looking quality employees and other risks information is based on various detailed in our other filings with factors and was derived using the SEC. We do not promise to update numerous assumptions. forward- looking information to reflect actual results or changes in Important factors that may cause assumptions or other factors that the actual results to differ include, could affect those statements. without limitation, the results of 4 USE OF PROCEEDS We intend to use the net proceeds ness, working capital, investment in from the sale of the securities for financing transactions and capital general corporate purposes. Those expenditures. We will describe in the purposes include the repayment or Supplement any proposed use of refinancing of debt, acquisitions in proceeds other than for general the ordinary course of busi- corporate purposes. DESCRIPTION OF THE SECURITIES We will issue the securities under o The amount or percentage payable an Indenture dated as of October 1, if we accelerate their maturity, 1995, as supplemented and amended if other than the principal from time to time, between us and The amount. Bank of New York (formerly First Interstate Bank, N.A.), as Trustee. The Indenture is filed as an exhibit o Any changes to the events of to the registration statement of default or covenants set forth which this Prospectus is a part. To in the Indenture. obtain a copy of the Indenture, see "Where You Can Find More o Any other terms consistent with Information." The following the Indenture. description is a brief summary of and is subject to all the terms of the We may authorize and determine the Indenture. terms of a series of securities by resolution of our board of directors GENERAL or one of its committees or through a supplemental indenture. The securities offered by this Prospectus will be limited to $1.5 FORM OF SECURITIES billion principal amount. The Indenture does not limit the amount The securities will be issued in of securities we could offer under registered form. Unless the it. We can issue securities in one or Supplement otherwise provides, more series, in each case as securities will be issued as one or authorized by us from time to time. more global securities. This means Each series may differ as to their that we will not issue certificates terms. The securities will be our to each holder. We will generally unsecured general obligations and issue global securities in the total will not be subordinated to our other principal amount of the securities general indebtedness. distributed in that series. We will issue securities only in The Supplement will address the denominations of $1,000 or integral following terms of the securities: multiples of that amount, unless the Supplement states otherwise. o Their title. GLOBAL SECURITIES o Any limits on the principal amounts to be issued. IN GENERAL. Securities in global form will be deposited with or on o The dates on which the principal behalf of a depositary. Global is payable. securities are represented by one or more global certificates for the o The rates (which may be fixed or series registered in the name of the variable) at which they shall depositary or its nominee. Securities bear interest, or the method for in global form may not be transferred determining rates. except as a whole among the depositary, a nominee of or a o The dates from which the successor to the depositary and any interest will accrue and will be nominee of that successor. Unless payable, or the method of otherwise identified in the determining those dates, and any Supplement, the depositary will be record dates for the payments The Depositary Trust Company. due. o Any provisions for redemption at our option or otherwise, including the periods, prices and terms of redemption. o Any sinking fund or similar provisions, whether mandatory or at the holder's option, along with the periods, prices and terms of redemption, purchase or repayment. 5 NO DEPOSITARY OR GLOBAL DTC ORGANIZATION. The Depository SECURITIES. If a depositary for a Trust Company is a limited-purpose series is unwilling or unable to trust company organized under the New continue as depositary, and a York Banking Law, a "banking successor is not appointed by us organization" within the meaning of within 90 days, we will issue that law, a member of the Federal securities of that series in Reserve System, a "clearing definitive form in exchange for the corporation" within the meaning of global security or securities of that the New York Uniform Commercial Code, series. We may also determine at any and a "clearing agency" registered time in our discretion not to use under the provisions of Section 17A global securities for any series. In of the Securities Exchange Act of that event, we will issue securities 1934, as amended. in definitive form. DTC is owned by a number of its OWNERSHIP OF THE GLOBAL direct participants and by the New SECURITIES/ BENEFICIAL OWNERSHIP. So York Stock Exchange, Inc., the long as the depositary or its nominee American Stock Exchange, Inc. and the is the registered owner of a global National Association of Securities security, that entity will be the Dealers, Inc. Direct participants sole holder of the securities include securities brokers and represented by that instrument. dealers, banks, trust companies, FINOVA and the Trustee are only clearing corporations and certain required to treat the depositary or other organizations who directly its nominee as the legal owner of participate in DTC (each a "direct those securities for all purposes participant"). Other entities under the Indenture. ("indirect participants") may access DTC's system by clearing transactions Each actual purchaser of through or maintaining a custodial securities represented by a global relationship with direct security (a "beneficial owner") will participants, either directly or not be entitled to receive physical indirectly. The rules applicable to delivery of certificated securities, DTC and its participants are on file will not be considered the holders of with the SEC. those securities for any purpose under the Indenture, and will not be DTC ACTIVITIES. DTC holds able to transfer or exchange the securities that its participants global securities, unless this deposit with it. DTC also facilitates Prospectus or the Supplement provide the settlement among participants of to the contrary. As a result, each securities transactions, such as beneficial owner must rely on the transfers and pledges, in deposited procedures of the depositary to securities through electronic exercise any rights of a holder under computerized book-entry changes in the Indenture. In addition, if the participant's accounts. Doing so beneficial owner is not a direct or eliminates the need for physical indirect participant in the movement of securities certificates. depositary (each a "participant"), the beneficial owner must rely on the PARTICIPANT'S RECORDS. Except as procedures of the participant through otherwise provided in this Prospectus which it owns its beneficial interest or a Supplement, purchases of the in the global security. securities must be made by or through direct participants, which will The laws of some jurisdictions receive a credit for the securities require that certain purchasers of on the depositary's records. The securities take physical delivery of beneficial owner's ownership interest the securities in certificated form. is in turn to be recorded on the Those laws and the above conditions direct and indirect participant's may impair the ability to transfer records. Beneficial owners will not beneficial interests in the global receive written confirmations from securities. the depositary of their purchase, but they are expected to receive them, THE DEPOSITORY TRUST COMPANY along with periodic statements of their holdings, from the direct or The following is based on indirect participants through whom information furnished by The they entered into the transaction. Depository Trust Company ("DTC") and applies to the extent it is the Transfers of interests in the depositary, unless otherwise stated global securities will be made on the in a Supplement: books of the participants on behalf of the beneficial owners. REGISTERED OWNER. The securities Certificates representing the will be issued as fully registered interest of the beneficial owners in securities in the name of Cede & Co. the securities will not be issued (DTC's partnership nominee). One unless the use of global securities fully registered global security is suspended as provided above. generally will be issued for each $200 million principal amount of The depositary has no knowledge of securities. The Trustee will deposit the actual beneficial owners of the the global securities with the global securities. Its records depositary. The deposit of the global securities with DTC and its registration in the name of Cede & Co. will not change the beneficial ownership of the securities. 6 only reflect the identity of the require payment to cover taxes and direct participants as owners of the other governmental charges. The securities. Those participants may or Trustee will initially act as may not be the beneficial owners. authenticating agent under the Participants are responsible for Indenture. keeping account of their holdings on behalf of their customers. SAME-DAY SETTLEMENT AND PAYMENT NOTICES AMONG THE DEPOSITARY, Unless the Supplement otherwise PARTICIPANTS AND BENEFICIAL OWNERS. provides, the securities will be Notices and other communications by settled in immediately available the depositary, its participants and funds. We will make payments of the beneficial owners will be principal and interest in immediately governed by arrangements among them, available funds. subject to any legal requirements in effect. PAYMENT AND PAYING AGENT VOTING PROCEDURES. Neither DTC nor If the securities are not held in Cede & Co. will consent or vote with global form, we will make payment of respect to the global securities. The principal and premium, if any, depositary generally mails an omnibus against surrender of the securities proxy to us just after the applicable at the principal office of the record date. That proxy assigns Cede Trustee in New York, New York. We & Co.'s consenting or voting rights will pay any installment of interest to the direct participants to whose on securities to the record holder on accounts the securities are credited the record date for that interest. We at that time. can make those payments through the Trustee, as noted above, by check PAYMENTS. Principal and interest mailed by first class mail to the payments made by us will be delivered registered holders at their to the depositary. DTC's practice is registered address or by wire to credit direct participants' transfer to an eligible account of accounts on the applicable payment the registered holder. date unless it has reason to believe it will not receive payment on that If any payments of principal, date. Payments by participants to premium or interest are not claimed beneficial owners will be governed by within three years of the date the standing instructions and customary payment became due, those funds are practices, as is the case with to be repaid to us. The beneficial securities held for customers in owners of those interests will bearer form or registered in "street thereafter look only to us for name." Those payments will be the payment for those amounts. responsibility of that participant, not the depositary, the Trustee or CERTAIN INDENTURE PROVISIONS us, subject to any legal requirements in effect at that time. CERTAIN DEFINITIONS. The following is a summary of certain terms defined We are responsible for payment of in the Indenture. Those terms shall principal, interest and premium, if be determined in accordance with any, to the Trustee, who is generally accepted accounting responsible to pay it to the principles, unless otherwise depositary. The depositary is indicated. responsible for disbursing those payments to direct participants. The "Consolidated Net Tangible Assets" participants are responsible for means the total of all assets disbursing payments to the beneficial reflected on the most recent owners. quarterly or annual consolidated balance sheet of us and our TRANSFER OR EXCHANGE OF SECURITIES consolidated Subsidiaries, at their net book values (after deducting You may transfer or exchange the related depreciation, depletion, securities (other than a global amortization and all other valuation security) without service charge at reserves), less the aggregate of our our office designated for that current liabilities and those of our purpose or at the office of any consolidated Subsidiaries reflected transfer agent or security registrar on that balance sheet. We exclude identified under the Indenture. You from assets goodwill, unamortized must execute a proper form of debt discount and all other like transfer and pay any taxes and other intangible assets. For purposes of governmental charges resulting from this definition, "current that action. You may transfer or liabilities" include all indebtedness exchange the securities other than a for money borrowed, incurred, issued, global security initially at our assumed or guaranteed by us and our offices at 1850 N. Central Avenue, consolidated Subsidiaries, and other P.O. Box 2209, Phoenix, Arizona payables and accruals, in each case 85002-2209 or at our office or agency payable on demand or due within one established for that purpose in New year of the date of determination, York, New York. but shall exclude any portion of long-term debt maturing within one Securities in the several year of that date of determination, denominations will be interchangeable all as reflected on the consolidated without service charge, but we may balance sheet of us and our consolidated Subsidiaries. 7 "Lien" means any lien, charge, reserves, so long as foreclosure claim, security interest, pledge, or similar proceedings are not hypothecation, right of another under commenced. any conditional sale or other title retention agreement or any other o Judgment Liens that have not encumbrance affecting title to remained undischarged or property. Lien includes any lease unstayed for more than 6 months. under a sale and leaseback arrangement. o Incidental or undetermined construction, mechanics or "Subsidiary" means any corporation similar Liens arising in the a majority of the Voting Stock of ordinary course of business which is owned, directly or relating to obligations not indirectly, by us or by one or more overdue or which are being Subsidiaries or by us and one or more contested by us or a Restricted Subsidiaries. Subsidiary in good faith and deposits for release of such Liens. "Restricted Subsidiary" is any Subsidiary a majority of the Voting o Zoning restrictions, licenses, Stock of which is owned, directly, by easements and similar us or by one or more Restricted encumbrances or defects if Subsidiaries or by us and one or more immaterial. Restricted Subsidiaries and which is designated as such by resolution of o Other Liens immaterial in the our Board of Directors. aggregate incidental to our or the Restricted Subsidiary's business or property, other than "Unrestricted Subsidiary" means for indebtedness. any Subsidiary other than a Restricted Subsidiary. o Banker's liens and set off rights in the ordinary course of "Voting Stock" means stock of any business. class or classes (however designated) having ordinary voting power for the o Leasehold or purchase rights, election of a majority of the members exercisable for fair of the board of directors (or any consideration, arising in the governing body) of that corporation, ordinary course of business. other than stock having that power only by reason of the happening of a o Liens on property or securities contingency. existing when an entity becomes a Restricted Subsidiary or LIMITATION ON LIENS. The Indenture merges with us or a Restricted provides that FINOVA and its Subsidiary, provided it is not Restricted Subsidiaries will not incurred in anticipation of create, assume, incur or allow to be those events. created, assumed or incurred or to exist any Lien on any of our or their o Liens on property or securities properties unless we secure the existing at the time of securities equally and ratably with acquisition. any other obligation so secured. The Indenture contains the following o Liens in a total amount less exceptions to that prohibition: than $25 million, excluding Liens covered by the exceptions o Leases of property in the noted above. ordinary course of business or if the property is not needed in o Liens securing indebtedness of the operation of our business. us or a Restricted Subsidiary provided those and similar Liens o Purchase money security on indebtedness do not exceed interests that are non-recourse 10% of Consolidated Net Tangible to us or our Restricted Assets, excluding certain Subsidiaries except to the preexisting indebtedness and extent of the property so those Liens permitted above. acquired or any proceeds from that property, or both. MERGER, CONSOLIDATION AND SALE OF ASSETS. We can not merge with or o Governmental deposits or into, consolidate with, sell or lease security as a condition to the all or substantially all of our transaction of business or the assets to, or purchase all or exercise of a privilege, or to substantially all the assets of maintain self- insurance, or to another corporation unless we will be participate in any fund in the surviving corporation or the connection with worker's successor is incorporated in the U.S. compensation, unemployment and assumes all of our obligations insurance, pensions, social under the securities and the security, or for appeal bonds. Indenture, provided that immediately after that transaction, no default o Liens for taxes or assessments will exist. A purchase by a not yet due or which are payable Subsidiary of all or substantially without a penalty or are being all the assets of another corporation contested in good faith and with will not be a purchase of those adequate 8 assets by us. If, however, any of the If an event of default occurs and transactions noted in this paragraph continues, the Trustee or the holders occurs and results in a Lien on any of at least 25% of the series may of our properties (except as declare those securities due and permitted above), we must payable. We are required to certify simultaneously secure the securities to the Trustee annually as to our equally and ratably with the debt compliance with the Indenture. secured by that Lien. Holders of a majority of a series MODIFICATION OF THE INDENTURE. may control certain actions of the FINOVA and the Trustee may amend the Trustee and may waive past defaults Indenture without consent of the for that series. Except as provided holders of securities to do certain in the Indenture, the Trustee will things, such as establishing the form not be under any obligation to and terms of any series of exercise any of the rights or powers securities. We must obtain consent of vested in it by the Indenture at the holders of at least two-thirds of the request, order or direction of any outstanding securities affected by a holder unless one or more of them change to amend the terms of the shall have offered reasonable Indenture or any supplemental indemnity to the Trustee. indenture or the rights of the holders of those securities. If an event of default occurs and is continuing, the Trustee may Unanimous consent is required for reimburse itself for its reasonable changes to extend the fixed maturity compensation and expenses incurred of any securities, reduce the out of any sums held or received by principal, redemption premium or rate it before making any payments to the of interest, extend the time of holders of the securities of the payment of interest, change the form defaulted series. of currency or to limit the right to sue for payment on or after maturity The right of any holders of of the securities. Unanimous consent securities of a series to commence an is also required to reduce the level action for any remedy is subject to of consents needed to approve any certain conditions, including the such change. The Trustee must consent requirement that the holders of at to changes modifying its rights, least 25% of that series request that duties or immunities. the Trustee take such action, and offer reasonable indemnity to the DEFAULTS. Events of default under Trustee against its liabilities the Indenture for any series are: incurred in doing so. o Failure for 30 days to pay DEFEASANCE interest on any securities of that series. We may defease the securities of a series, meaning we would satisfy our o Failure to pay principal (other duties under that series before than sinking fund redemptions) maturity. We may do so by depositing or premium, if any, on with the Trustee, in trust for the securities of that series. benefit of the holders, either enough funds to pay, or direct U.S. o Failure for 30 days to pay any government obligations that, together sinking fund installment on that with the income on those obligations series. (without considering any reinvestment), will be sufficient to o Violation of a covenant under pay, the obligation of that series, the Indenture pertaining to that including principal, premium, if any, series that persists for at and interest. Certain other least 90 days after we are conditions must be met before we may notified by the Trustee or the do so. We must deliver an opinion of holders of 25% of the series. counsel that the holders of that series will have no Federal income o Default in other instruments or tax consequences as a result of that under any other series of deposit. securities resulting in acceleration of indebtedness CONCERNING THE TRUSTEE over $15 million, unless that default is rescinded or The Trustee is one of the banks in discharged within 10 days after one of our credit agreements and from written notice by the Trustee or time to time may perform other the holders of 10% of that banking, trust or related services on series. behalf of FINOVA or our customers. o Bankruptcy, insolvency or similar event. o Any other event of default with respect to the securities of that series. 9 PLAN OF DISTRIBUTION We may offer the securities Dealers and agents may be entitled directly or through underwriters, to indemnification as underwriters by dealers or agents. The Supplement us against certain liabilities under will identify those underwriters, the Federal securities laws and other dealers or agents and will describe laws. that plan of distribution. Firms not so named will have no direct or We or the underwriters or agents indirect participation in any may solicit offers by institutions underwriting of those securities, approved by us to purchase securities although a firm may participate in under contracts providing for payment the distribution of securities under in the future. Permitted institutions circumstances entitling it to a include commercial and savings banks, dealer's allowance or agent's insurance companies, pension funds, commission. investment companies, educational and charitable institutions and others. We anticipate that any Certain conditions apply to those underwriting agreement will entitle purchases. the underwriters to indemnity against certain civil liabilities under the Any underwriter may engage in Federal securities laws and other over-allotment, stabilizing laws, provide that their obligations transactions, short covering to purchase the securities will be transactions and penalty bids in subject to certain conditions, and accordance with Regulation M under generally require them to purchase the Securities Exchange Act of 1934. all of the securities if any are Over- allotment involves sales in purchased. excess of the offering size, which creates a short position. Stabilizing Unless otherwise noted in the transactions permit bids to purchase Supplement, the securities will be the underlying security so long as offered by the underwriters, if any, the stabilizing bids do not exceed a when, as and if issued by us, specified maximum. Short covering delivered to and accepted by the transactions involve purchases of the underwriters and subject to their securities in the open market after right to reject orders in whole or in the distribution is completed to part. cover short positions. Penalty bids permit the underwriters to reclaim a We may sell securities to dealers, selling concession from a dealer when as principals. Those dealers may then the securities originally sold by the resell the securities to the public dealer are purchased in a covering at varying prices set by those transaction to cover short positions. dealers from time to time. Those activities may cause the price of the securities to be higher than We may also offer the securities it would otherwise be. If commenced, through agents. Agents generally act the underwriters may discontinue on a "best efforts" basis during those activities at any time. their appointment, meaning they are not obligated to purchase the The Supplement will set forth the securities. anticipated delivery date of the securities being sold at that time. LEGAL MATTERS Unless otherwise noted in a securities offered through this Supplement, William J. Hallinan, Prospectus and any Supplement and Esq., Senior Vice President-General Brown & Wood LLP will act as counsel Counsel to FINOVA, will pass on the for any underwriters or agents. legality of the EXPERTS Deloitte & Touche LLP, independent December 31, 1996. The financial auditors, have audited the financial statements are incorporated into this statements for FINOVA incorporated in Prospectus by reference in reliance this Prospectus by reference from our upon their report given upon their Annual Report on Form 10-K for the authority as experts in accounting year ended and auditing. 10 ===================================== ===================================== YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR IN THE SUPPLEMENT. WE FINOVA HAVE AUTHORIZED NO ONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF THESE SECURITIES IN ANY LOCATION WHERE THE OFFER IS NOT PERMITTED. FINOVA YOU SHOULD NOT ASSUME THAT THE CAPITAL INFORMATION IN THIS PROSPECTUS OR IN CORPORATION THE SUPPLEMENT, INCLUDING INFORMATION INCORPORATED BY REFERENCE, IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THE PROSPECTUS OR SUPPLEMENT, AS APPLICABLE. 7.40% Notes ----------- Due June 1, 2007 TABLE OF CONTENTS
PAGE ---- PROSPECTUS SUPPLEMENT FINOVA Capital Corporation ................S-2 Note Terms ................................S-2 PROSPECTUS SUPPLEMENT Underwriting ..............................S-3 Notice to Canadian Residents ..............S-3 PROSPECTUS Where You Can Find More Information ......2 FINOVA Capital Corporation ................2 Ratio of Income to Fixed Charges ..........4 CITICORP SECURITIES, INC. Special Note Regarding Forward-Looking Statements ...............................4 Use of Proceeds ...........................5 Description of the Securities .............5 Plan of Distribution ......................10 Legal Matters .............................10 Experts ...................................10
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