EXHIBIT NO. 99.1
TERMINATION AGREEMENT
This Termination Agreement is entered into as of January 22, 2001
between The FINOVA Group Inc., a Delaware corporation ("Company"), and Leucadia
National Corporation. a Delaware corporation ("Purchaser").
WHEREAS, the Company and Purchaser have entered into a Securities
Purchase Agreement dated as of December 20, 2000 between Company and Purchaser
(the "Agreement"), which they now wish to terminate by mutual consent pursuant
to Section 8.1(a) of the Agreement;
NOW THEREFORE, in consideration of the mutual agreements herein set
forth, and for other good and valuable consideration, the parties do hereby
agree as follows
1. The Agreement shall be terminated, without liability of either
party to the other except as expressly set forth herein. Except as so set forth,
each of Purchaser and the Company waives any and all rights or claims which it
may have against the other, or any of such party's officers, directors,
employees or affiliates, counsel and agents arising from the Agreement.
2. Notwithstanding the provisions of Section 8.2 of the Agreement,
the Company agrees that in the event that the Board of Directors of the Company
determines that it is in the best interests of the Company to commence a
voluntary petition for reorganization relief pursuant to Chapter 11 of title 11
of the United States Code, 11 U.S.C. Section 101 et seq., Purchaser shall have a
liquidated damages claim of $3 million.
3. The Company agrees that the restrictions set forth in paragraph 9
of the Non-Disclosure Agreement (as defined in the Agreement) shall be
terminated and of no further force or effect. Purchaser repeats its
acknowledgement set forth in paragraph 12 of the Non-Disclosure Agreement.
4. The provisions of Sections 5.2(b), 6.3 and 8.4 and Article X of
the Agreement shall survive the termination of the Agreement. The Company and
Purchaser shall issue a joint press release announcing termination of the
Agreement in the form of Annex A, attached hereto.
IN WITNESS WHEREOF, Company and Purchaser have executed this
Agreement as of the day and year first written above.
THE FINOVA GROUP INC.
By:
-----------------------------
Name:
Title:
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LEUCADIA NATIONAL CORPORATION
By:
-----------------------------
Name:
Title:
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Annex A
CONTACT AT FINOVA: CONTACT AT LEUCADIA:
Xxxxxx X. Xxxxxxx Xxxxx Xxxxxxxx
480/636-5355 212/000-0000
FINOVA MEDIA CONTACT:
Xxxxxx Xxxxxx or Xxxx Xxxxxxx
212/371-5999
THE FINOVA GROUP INC. AND LEUCADIA NATIONAL CORPORATION ANNOUNCE MUTUAL
TERMINATION OF SECURITIES PURCHASE AGREEMENT
SCOTTSDALE, ARIZ. AND NEW YORK, NY, JAN. 24, 2001 -- The FINOVA Group Inc.
(NYSE: FNV) and Leucadia National Corporation (NYSE and PCX: LUK) announced
today that they have mutually agreed to terminate their Securities Purchase
Agreement dated December 20, 2000. The termination was agreed to after it became
evident that the parties would not likely conclude a restructuring agreement
with FINOVA's bank lenders and public debt holders on terms deemed mutually
acceptable to FINOVA and Leucadia. FINOVA intends to continue working with its
creditors and anticipates presenting a revised restructuring plan in the very
near future. As previously noted, it is expected that substantially all of the
company's lenders will have to agree to this restructuring to avoid the
possibility of reorganization under protection of the courts.
The FINOVA Group Inc., through its principal operating subsidiary, FINOVA
Capital Corporation, is a financial services company focused on providing a
broad range of capital solutions primarily to midsize business. FINOVA is
headquartered in Scottsdale, Ariz., with business development offices throughout
the U.S. and London, U.K., and Toronto, Canada. For more information, visit the
company's website at xxx.xxxxxx.xxx.
Leucadia National Corporation is a holding company for its consolidated
subsidiaries engaged in property and casualty insurance (through Empire
Insurance Company and Allcity Insurance Company), manufacturing (through its
Plastics Division), banking and lending (principally through American Investment
Bank, N.A.) and mining (through MK Gold Company). Leucadia also currently has
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equity interests of more than 5% in the following domestic public companies;
Carmike Cinemas, Inc. (6% of Class A Shares), GFSI Holdings, Inc. (6%), Jordan
Industries, Inc. (10%) and PhoneTel Technologies, Inc. (7%).
This news release contains forward-looking statements such as predictions or
forecasts. FINOVA and Leucadia assume no obligation to update those statements
to reflect actual results, changes in assumptions or other factors. The
forward-looking statements are subject to known and unknown risks, uncertainties
and other factors that could cause actual results to differ materially from
those projected. Those factors include FINOVA's ability to address its financing
requirements in light of its existing debt obligations and market conditions;
pending and potential litigation related to charges to earnings; the results of
efforts to implement FINOVA's business strategy, including the ability to
complete a debt restructuring; the ability to attract and retain key personnel
and customers; conditions that adversely impact FINOVA's borrowers and their
ability to meet their obligations to FINOVA; actual results in connection with
continuing or discontinued operations; the adequacy of FINOVA's loan loss
reserves and other risks detailed in FINOVA's SEC reports, including page 15 of
FINOVA's 10-K for 1999.
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