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: January 31, 2002
NATIONAL AUTO CREDIT, INC.
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 1-11601 34-1816760
----------- --------- ---------------
(State or other jurisdiction (Commission File No.) (Employer Identification No.)
of incorporation)
555 Madison Avenue, New York, New York 10021
---------------------------------------- -------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 644-1400
---------------
ITEM 5. OTHER EVENTS.
DISCONTINUATION OF ZOOMLOT OPERATIONS
On January 31, 2002, National Auto Credit, Inc., a Delaware corporation
("NAC" or the "Company"), entered into an Exchange and Repayment Agreement
("Exchange Agreement") dated January 31, 2002 with Cygnet Capital Corporation,
Verde Reinsurance Company, Ltd., Ernie Garcia III 2000 Trust, Brian Garcia 2000
Trust, EJMS Investors Limited Partnership, Ernest C. Garcia II, Ray Fidel,
Steven P. Johnson, Mark Sauder, Colin Bachinsky, Chris Rompalo, Donna Clawson,
Mary Reiner, and Kathy Chacon (the "Former ZoomLot Shareholders"). The ZoomLot
Shareholders had previously received common and preferred shares of NAC pursuant
to a Merger Agreement and Plan of Reorganization (the "Merger Agreement")
executed December 15, 2000 (a copy of which was attached to Form 8-K filed by
NAC with the Commission on January 2, 2001).
The Exchange Agreement sets forth the agreement among all the parties
to terminate the operations of ZoomLot, Inc. ("ZoomLot") as a result of an
extensive strategic review of ZoomLot's prospects. As a result, the parties
further agreed, the First and Second Objectives (as those terms are defined in
the Merger Agreement") have not and will not be met. Accordingly, all
Forfeitable Shares (as that term is defined in the Merger Agreement) are deemed
forfeited and are to be returned and surrendered to NAC.
As part of the Exchange Agreement, contingent obligations owed to NAC
and set forth in Section 1.12 of the Merger Agreement will be repaid by the
ZoomLot Shareholders. The repayment obligation will be effected by the ZoomLot
Shareholders as follows: (a) 3,009,530 shares of NAC common stock shall be
transferred to NAC at an agreed upon value of $1.25 per share; (b) 62,380 shares
of NAC Series C Preferred Stock shall be transferred to NAC at an aggregate
agreed-upon value of $854,875; and (c) certain of the ZoomLot Shareholders shall
provide a promissory note to NAC in the amount of $986,048, payable in cash or
NAC stock (at a mutually agreed-upon value of $1.25 per share) on or before
January 30, 2003, with interest at 4% per annum.
In addition, all the ancillary agreements executed in connection with
the initial acquisition of ZoomLot on December 15, 2001, including a
Registration Rights Agreement and Lock-Up, Standstill and Voting Agreement were
terminated, and certain ZoomLot employees have resigned.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(C) EXHIBITS
(2) Exchange and Repayment Agreement dated January 31, 2002 by
and among National Auto Credit, Inc., Cygnet Capital Corporation, Verde
Reinsurance Company, Ltd., Ernie Garcia III 2000 Trust, Brian Garcia 2000 Trust,
EJMS Investors
Limited Partnership, Ernest C. Garcia II, Ray Fidel, Steven P. Johnson,
Mark Sauder, Colin Bachinsky, Chris Rompalo, Donna Clawson, Mary Reiner, and
Kathy Chacon.
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 thereunto duly authorized.
Dated: February 4, 2002 NATIONAL AUTO CREDIT, INC.
(Registrant)
By: /s/ JAMES J. MCNAMARA
------------------------------
JAMES J. MCNAMARA
Chief Executive Officer