-----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, TzO1mnTWJmjh40C07jOsIQhVC3sqXBsXTpfqylV3NcXDi+Ndrc5EqHNiV+OV89C/ Yobju+b8VIBYHP58WkPE6Q== 0000895345-01-000026.txt : 20010131 0000895345-01-000026.hdr.sgml : 20010131 ACCESSION NUMBER: 0000895345-01-000026 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20010130 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: DYNEX CAPITAL INC CENTRAL INDEX KEY: 0000826675 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 521549373 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-41043 FILM NUMBER: 1519058 BUSINESS ADDRESS: STREET 1: 4551 COX RD STREET 2: STE 300 CITY: GLEN ALLEN STATE: VA ZIP: 23060 BUSINESS PHONE: 8049675800 MAIL ADDRESS: STREET 1: 4551 COX RD STREET 2: STE 300 CITY: GLEN ALLEN STATE: VA ZIP: 23060 FORMER COMPANY: FORMER CONFORMED NAME: RESOURCE MORTGAGE CAPITAL INC/VA DATE OF NAME CHANGE: 19930722 FORMER COMPANY: FORMER CONFORMED NAME: RESOURCE MORTGAGE INVESTMENT CORP DATE OF NAME CHANGE: 19930505 FORMER COMPANY: FORMER CONFORMED NAME: RAC MORTGAGE INVESTMENT CORP /VA/ DATE OF NAME CHANGE: 19930505 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CALIFORNIA INVESTMENT FUND LLC CENTRAL INDEX KEY: 0001110901 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 330688954 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 550 WEST C STREET STE 1000 CITY: SAN DIEGO STATE: CA ZIP: 92101 BUSINESS PHONE: 6196875000 MAIL ADDRESS: STREET 1: 550 WEST C STREET STE 1000 CITY: SAN DIEGO STATE: CA ZIP: 92101 SC 13D/A 1 0001.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)* (AMENDMENT NO. 11) Dynex Capital, Inc. - --------------------------------------------------------------------------- (Name of Issuer) Common Stock, $0.01 par value per share - --------------------------------------------------------------------------- (Title of Class of Securities) 26817Q506 - --------------------------------------------------------------------------- (CUSIP Number) with a copy to: Stephen Fraidin Michael R. Kelly Fried, Frank, Harris, Shriver & 550 West C Street Jacobson San Diego, CA 92101 One New York Plaza (619) 687-5000 New York, NY 10004-1980 (212) 859-8000 - --------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) January 29, 2001 - --------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box |_|. Note: Schedules filed in paper format shall include a signed original and five copies of the Schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 26817Q506 1 NAME OF REPORTING PERSON/ I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS CALIFORNIA INVESTMENT FUND, LLC 33-0688954 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] NOT APPLICABLE 6 CITIZENSHIP OR PLACE OF ORGANIZATION CALIFORNIA NUMBER OF 7 SOLE VOTING POWER SHARES -0- BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH 572,178 REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 572,178 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 572,178 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ] EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.00% 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) CO CUSIP No. 26817Q506 1 NAME OF REPORTING PERSON/ I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS MICHAEL R. KELLY 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] NOT APPLICABLE 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA NUMBER OF 7 SOLE VOTING POWER SHARES -0- BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH 572,178 REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 572,178 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 572,178 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ] EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.00% 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN CUSIP No. 26817Q506 1 NAME OF REPORTING PERSON/ I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS RICHARD KELLY 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [x] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] NOT APPLICABLE 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA NUMBER OF 7 SOLE VOTING POWER SHARES -0- BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH 572,178 REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 572,178 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 572,178 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ] EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.00% 14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) IN This amendment amends and supplements Schedule 13D of California Investment Fund, LLC, dated April 3, 2000 and filed on April 4, 2000 with the Securities and Exchange Commission ("SEC"), Amendment No. 1 to Schedule 13D, dated September 12, 2000 and filed on September 13, 2000 with the SEC, Amendment No. 2 to Schedule 13D, dated October 3, 2000 and filed on October 3, 2000 with the SEC, Amendment No. 3 to Schedule 13D, dated October 17, 2000 and filed on October 17, 2000 with the SEC, Amendment No. 4 to Schedule 13D, dated October 24, 2000 and filed on October 24, 2000 with the SEC, Amendment No. 5 to Schedule 13D, dated October 30, 2000 and filed on October 30, 2000 with the SEC, Amendment No. 6 to Schedule 13D, dated November 8, 2000 and filed on November 8, 2000 with the SEC, Amendment No. 7 to Schedule 13D, dated December 12, 2000 and filed on December 12, 2000 with the SEC, Amendment No. 8 to Schedule 13D, dated December 21, 2000 and filed on December 21, 2000 with the SEC, Amendment No. 9 to Schedule 13D, dated December 27, 2000 and filed on December 27, 2000 with the SEC, and Amendment No. 10 to Schedule 13D, dated January 5, 2001 and filed on January 5, 2001 with the SEC (together, the "Schedule 13D"). Except as amended by this amendment, there has been no change in the information previously reported on the Schedule 13D. ITEM 4. Purpose of Transaction. ---------------------- On November 7, 2000, California Investment Fund, LLC (the "Fund") and Dynex Capital, Inc. ("Dynex") entered into a definitive merger agreement (as amended, the "Merger Agreement") pursuant to which a newly formed subsidiary of the Fund will merge with and into Dynex and Dynex will become a wholly owned subsidiary of the Fund for a purchase price of $90 million in cash for all of the equity of Dynex (the "Acquisition Transaction"). There can be no assurance that the Acquisition Transaction will be completed on the terms set forth in the Merger Agreement or otherwise. A copy of the Merger Agreement was attached as Exhibit B to the Fund's Amendment No. 6 to Schedule 13D filed on November 8, 2000 with the SEC, and is specifically incorporated herein by reference, and the description herein of such merger agreement is qualified in its entirety by reference to such agreement. On January 29, 2001, the Fund delivered to Dynex a letter (the "Response Letter"), a copy of which is attached hereto as Exhibit A and specifically incorporated herein by reference, and the description herein of the Response Letter is qualified in its entirety by reference to such Response Letter. The Response Letter responds to a letter, dated January 26, 2001, from Dynex to the Fund (the "January 26 Letter") which purports to terminate the Merger Agreement and to a letter, dated January 26, 2001, sent by Dynex to U.S. Trust Company, National Association (the "Escrow Deposit Request"). A copy of the January 26 Letter and the Escrow Deposit Request are attached hereto as Exhibits B and C, respectively, and are specifically incorporated herein by reference, and the description herein of such letters is qualified in its entirety by reference to such letters. The Response Letter states that the Fund believes that Dynex has no proper basis for terminating the Merger Agreement and urges Dynex to promptly rescind any purported termination of the Merger Agreement. The Response Letter requests Dynex to take no action inconsistent with the consummation of the transactions contemplated by the Merger Agreement in accordance with its terms and reserves all rights of the Fund, including the right to sue and protect the interests of the Fund and Dynex's shareholders. Depending on the outcome of the Acquisition Transaction, the Fund reserves the right to formulate other plans and/or make other proposals, and take such actions with respect to its investments in Dynex, including any or all of the actions set forth in paragraphs (a) through (j) of Item 4 of Schedule 13D and any other actions as it may determine. Except as stated in this response to Item 4 and in furtherance of closing the Acquisition Transaction pursuant to the terms of the Merger Agreement, the Fund has no current plans or proposals with respect to Dynex or its securities of the types enumerated in paragraphs (a) through (j) of Item 4 of Schedule 13D. ITEM 7. Material to be Filed as Exhibits. -------------------------------- Exhibit A -- Letter, dated January 29, 2001, from California Investment Fund, LLC to Dynex Capital, Inc. Exhibit B -- Letter, dated January 26, 2001, from Dynex Capital, Inc. to California Investment Fund, LLC. Exhibit C -- Letter, dated January 26, 2001, from Dynex Capital, Inc. to U.S. Trust Company, National Association. SIGNATURES After reasonable inquiry and to the best of our knowledge and belief, we certify that the information set forth in this statement is true, complete and correct. Date: January 30, 2001 California Investment Fund, LLC, a California limited liability company By: /s/ Michael R. Kelly ---------------------------------- Michael R. Kelly Its: Managing Member Date: January 30, 2001 Michael R. Kelly By: /s/ Michael R. Kelly ---------------------------------- Michael R. Kelly, as an Individual Date: January 30, 2001 Richard Kelly By: /s/ Richard Kelly ---------------------------------- Richard Kelly, as an Individual Exhibit Index Exhibit A -- Letter, dated January 29, 2001, from California Investment Fund, LLC to Dynex Capital, Inc. Exhibit B -- Letter, dated January 26, 2001, from Dynex Capital, Inc. to California Investment Fund, LLC. Exhibit C -- Letter, dated January 26, 2001, from Dynex Capital, Inc. to U.S. Trust Company, National Association. EX-99.1 2 0002.txt EXHIBIT A CALIFORNIA INVESTMENT FUND, LLC January 29, 2001 VIA FACSIMILE AND CERTIFIED MAIL - -------------------------------- The Board of Directors Dynex Capital, Inc. 4551 Cox Road Glen Allen, VA 23060 Dear Sirs: We are in receipt of a letter from Stephen J. Benedetti dated January 26, 2001 purporting to terminate the Agreement and Plan of Merger dated November 7, 2000 (the "Merger Agreement"), as well as an Escrow Deposit Request Mr. Benedetti sent to U.S. Trust Company on the same date. CIF believes that Dynex has no proper basis for terminating the Merger Agreement. We urge you to promptly rescind your purported termination of the Merger Agreement. Dynex's decision to rely upon technical details in purporting to terminate the Merger Agreement, when as Dynex well knows, CIF has been successfully moving forward toward the consummation of the transactions contemplated by the Merger Agreement in accordance with its terms, raises serious questions as to whether Dynex is fulfilling its obligation to deal with CIF in good faith and whether Dynex is acting in the best interests of its shareholders. Dynex's wrongful termination of the Merger Agreement is also interfering with CIF's ability to document its agreement with the bondholders, and Dynex must therefore rescind that wrongful termination immediately or be held accountable for the resulting damages to CIF. We further request that Dynex take no action inconsistent with the consummation of the transactions contemplated by the Merger Agreement, in accordance with the terms of that agreement. CIF reserves all its rights, including the right to sue to protect its and all other Dynex shareholders' interests. Very truly yours, California Investment Fund, LLC /s/ Michael R. Kelly Michael R. Kelly Managing Member cc: Elizabeth R. Hughes, Esq. 550 WEST C STREET/10TH FLOOR SAN DIEGO, CALIFORNIA 92101-3531 TEL 619-687-5000/FAX 619-687-5010 EX-99.2 3 0003.txt EXHIBIT B DYNEX DYNEX CAPITAL, INC. 4551 COX ROAD, SUITE 300 GLEN ALLEN, VIRGINIA 23060 804-217-5800 FAX 804-217-5860 January 26, 2001 VIA FACSIMILE AND CERTIFIED MAIL - -------------------------------- California Investment Fund, LLC 550 West C Street 10th Floor San Diego, CA 92101 Attention: Michael R. Kelly, Managing Member RE: MERGER AGREEMENT DATED NOVEMBER 7, 2000 Dear Mr. Kelly: Reference is made to the Agreement and Plan of Merger dated November 7, 2000, as amended ("Merger Agreement") between California Investment Fund, LLC ("CIF"), DCI Acquisition Corporation and Dynex Capital, Inc. ("Dynex") and to the letter dated December 22, 2000 between Dynex and CIF (the "December 22nd Letter"). Dynex hereby notifies you that Dynex is terminating the Merger Agreement for CIF's breaches of its obligations under numbered paragraphs 2 and 3 of the December 22nd Letter and pursuant to Section 7(a)(vii) of the Merger Agreement. Very truly yours, DYNEX CAPITAL, INC. By: /s/ Stephen J. Benedetti -------------------------------- Stephen J. Benedetti Vice President, Treasurer cc: Stephen Fraidin, Esquire EX-99.3 4 0004.txt EXHIBIT C DYNEX DYNEX CAPITAL, INC. 4551 COX ROAD, SUITE 300 GLEN ALLEN, VIRGINIA 23060 804-217-5800 FAX 804-217-5860 January 26, 2001 BY CERTIFIED MAIL - RETURN RECEIPT REQUESTED & BY FACSIMILE: (213) 488-1370 - ---------------------------------------- U.S. Trust Company, National Association 515 South Flower Street Suite 2700 Los Angeles, CA 90071 Attention: Corporate Trust Division Re: Escrow Agreement dated as of November 7, 2000 by and among California Investment Fund, LLC, Dynex Capital, Inc. and U.S. Trust Company, National Association Dear Sir or Madam: This is to notify you that Dynex Capital, Inc. ("Dynex") has terminated the Agreement and Plan of Merger dated as of November 7, 2000 by and among California Investment Fund, LLC ("CIF"), DCI Acquisition Corporation and Dynex, as amended (the "Merger Agreement") pursuant to Sections 7(a)(vii) of the Merger Agreement as a result of the failure of CIF to satisfy the condition set forth in Section 6(b)(iii) of the Merger Agreement. This letter is the Escrow Deposit Request of Dynex. CIF is in breach of its obligations under Section 5(e) Merger Agreement because the letter addressed to Dynex from Fremont Investment & Loan dated December 19, 2000 is neither a "commitment" to provide financing nor is it from a financing source "capable of financing the transactions contemplated by" the Merger Agreement. In addition, CIF is in breach of its obligations under numbered paragraphs 2 and 3 in the attached letter dated December 22, 2000 between Dynex and CIF. Dynex represents and warrants that it is asserting a Claim pursuant to Section 4(a)(ii) of the captioned Escrow Agreement (the "Escrow Agreement") for the Escrow Shares and the full amount of the Escrow Fund, as a result of the Material Breach. Please disburse to Dynex the Escrow Shares and the full amount of the Escrow Fund. Capitalized terms used but not otherwise defined in this letter shall have the meanings ascribed to such terms in the Escrow Agreement. Thank you for your immediate attention to this matter. DYNEX CAPITAL, INC. By: /s/ Stephen J. Benedetti -------------------------------- Stephen J. Benedetti, Vice President cc: California Investment Fund, LLC (by certified mail - return receipt requested & by facsimile) Stephen Fraidin, Esq. (by certified mail - return receipt requested & by facsimile) Ray LaSoya, Esq. (by facsimile) Elizabeth R. Hughes, Esq. (by facsimile) -----END PRIVACY-ENHANCED MESSAGE-----