1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 31, 2005
COMMERCIAL FEDERAL CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
NEBRASKA 1-11515 47-0658852
--------------------------------------------------------------------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
13220 CALIFORNIA STREET, OMAHA, NEBRASKA 68154
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (402) 554-9200
--------------
NOT APPLICABLE
--------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
2
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
------------------------------------------
On March 31, 2005, Commercial Federal Corporation (the "Company")
executed a Servicing Rights Purchase and Sale Agreement (the "Agreement') to
sell its approximately $10 billion national third party mortgage servicing
portfolio and its broker and correspondent mortgage origination network to Wells
Fargo Bank, N.A. ("Wells Fargo"), a subsidiary of Wells Fargo and Company, for
approximately $137 million. Approximately seventy percent of the purchase price
was paid on March 31, 2005, with the remaining thirty percent to be paid as
loans transfer from the Company to Well Fargo. The sales price is subject to
adjustments for loans that prepay within thirty days of March 31, 2005, and for
loans where investor consent to the transfer is not obtained. The Company will
continue to service the mortgage loans under an Interim Servicing Agreement
until the servicing is transferred to Wells Fargo in approximately 90-120 days.
The Company is responsible for the costs associated with the transfer of the
loans.
The Company and Wells Fargo have made representations and warranties
relating to their capacity to operate as a business and their ability to carry
out the terms of the Agreement. The Company has also made representations and
warranties regarding the mortgage loan and mortgage servicing rights portfolio
and the completeness, accuracy and legality of the documents supporting each
mortgage loan and servicing right.
ITEM 8.01 OTHER EVENTS
------------
On March 31, 2005, the Company announced that it executed a definitive
agreement to sell its approximately $10 billion national third party mortgage
servicing portfolio and broker and correspondent mortgage origination network to
Wells Fargo Bank, N.A., a subsidiary of Wells Fargo and Company. The Company
will continue to offer a full line of mortgage loan products and services to
consumers in its seven-state market area of Nebraska, Colorado, Iowa, Missouri,
Kansas, Oklahoma and Arizona. The Company estimates a total after-tax charge to
earnings approximating $65 million in the 2005 first quarter. This charge is
associated with prepayments of Federal Home Loan Bank borrowings, selling
investment securities, eliminating interest rate hedges, recording certain exit
costs tied to the business, and is inclusive of the 2005 first quarter valuation
adjustment for mortgage servicing rights. These transactions will not affect the
Bank's regulatory well-capitalized status.
It is estimated that approximately 135 positions will be affected by
the sale, but the Company it is taking a number of actions to minimize the
impact of job loss. For more information, reference is made to the Company's
press release dated March 31, 2005, which is filed with this Report as Exhibit
99.1 and incorporated herein by reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
---------------------------------
(a) Not applicable.
(b) Not applicable.
(c) The following exhibit is filed herewith:
Exhibit 99.1 Press Release dated March 31, 2005
3
SIGNATURE
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 hereunto duly authorized.
COMMERCIAL FEDERAL CORPORATION
------------------------------
(Registrant)
Date: April 6, 2005 By: /s/ David S. Fisher
-------------------------------
David S. Fisher
Executive Vice President and
Chief Financial Officer
(Duly Authorized Officer)