Consumers Financial Corporation Requests Proposals for the Purchase of Public Company Shell.Business Editors CAMP HILL--(BUSINESS WIRE)--Aug. 9, 2001 Consumers Financial Corporation (the "Company") announced today that it has recently sent a request for proposal letter ("RFP (Request For Proposal) A document that invites a vendor to submit a bid for hardware, software and/or services. It may provide a general or very detailed specification of the system. 1. (business) RFP - Request for Proposal. 2. ") to several investor groups which have expressed an interest in acquiring a controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in the Company's common stock. The Company is currently in the process of completing a plan of liquidation The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts. A type of proceeding pursuant to federal Bankruptcy and dissolution approved by its shareholders in March 1998. As indicated in the RFP, the Company's Board of Directors is willing to consider a transaction of this type in lieu of Instead of; in place of; in substitution of. It does not mean in addition to. the planned liquidation of the Company because it has the potential to produce future value for the common shareholders, who are projected to receive nothing under the planned liquidation. Any such transaction, however, must also offer some protection for the preferred shareholders. Virtually all of the net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. of the Company are held by the Company's remaining subsidiary, which is a Delaware-domiciled insurance company. Under Delaware Insurance Laws, those assets cannot be withdrawn until the subsidiary is sold or liquidated DAMAGES, LIQUIDATED, contracts. When the parties to a contract stipulate for the payment of a certain sum, as a satisfaction fixed and agreed upon by them, for the not doing of certain things particularly mentioned in the agreement, the sum so fixed upon is called liquidated damages. (q.v. . In order to move forward with an acquisition transaction, while protecting the interests of both the common and preferred shareholders, the Board has offered to grant an option to the investor group whose proposal, in the Board's judgment, offers the best value to the current common shareholders. Immediately following the completion by the Company of a tender offer or other payment to the preferred shareholders who elect to receive such a payment, the selected investor group would exercise its option to acquire control of the Company through the issuance of additional common shares. The Board also expects to receive and will review proposals from other interested parties in addition to those who received the initial RFP. |
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