Print Page  Close Window

SEC Filings

424B1
DITECH HOLDING CORP filed this Form 424B1 on 09/16/1997
Entire Document
 
<PAGE>   7
 
ownership of a majority of the stock in HCP while preserving HCHI's
qualification as a REIT, and (ii) permit certain activities of HCP to be wound
down before and after the closing of the Offering. See "Federal Income Tax
Considerations -- Requirements for Qualification as a REIT;" "Structure and
Formation Transactions -- The Structure of the Company;" and "-- The Formation
of HCHI and HCLP -- Benefits to the Principals."
 
                              STRUCTURE OF COMPANY
                              ORGANIZATIONAL CHART
- ---------------
(1) The Principals will initially own 716,677 shares of Common Stock,
    representing 12.54% of the outstanding shares of Common Stock. The
    Principals may thereafter be issued up to 216,667 additional shares of
    Common Stock, increasing their percentage ownership of the outstanding
    shares of Common Stock to up to 15.73%, if the Earn-Out vests. See
    "Structure and Formation Transactions -- HCHI -- The Formation of HCHI." In
    addition, the Principals may acquire additional shares of Common Stock upon
    the exercise of stock options granted to them under the Company's 1997
    Executive and Non-Employee Director Stock Option Plan or pursuant to the
    Company's Bonus Incentive Compensation Plan. See "Management -- Bonus
    Incentive Compensation Plan -- 1997 Stock Option Plan."
 
(2) HCHI will own 100% of the HCP Preferred representing the right to receive
    97% of dividend distributions from HCP, and the Principals will own 100% of
    the common stock of HCP representing the right to receive 3% of dividend
    distributions from HCP.
 
     HCHI will issue the Units, each of which will consist of one share of
Common Stock and one Warrant to purchase one share of Common Stock of HCHI. HCHI
will acquire the Investment Portfolio using the net proceeds of the Offering and
the net proceeds of borrowings and securitizations. The Principals will
contribute the HCP Preferred to HCHI in exchange for 716,667 shares of Common
Stock and will serve as directors and officers of HCHI. See "Management --
Directors and Executive Officers." It is anticipated that HCHI's assets will
consist primarily of the Investment Portfolio and the HCP Preferred.
 
     Initially, the Principals will own 716,677 shares of Common Stock of HCHI,
or 12.54% of the outstanding shares of Common Stock. If the Earn-Out vests, HCHI
will issue up to 216,667 additional shares of Common Stock to the Principals as
an additional payment for their contribution of the HCP Preferred to HCHI. The
Earn-Out may vest in full or in part on any September 30 beginning with
September 30, 1998 and ending with September 30, 2002 (each, an "Earn-Out
Measuring Date"). The Earn-Out will vest in full as of any Earn-Out Measuring
Date through which the return on a Unit is at least equal to the initial public
offering
 
                                        7