As filed with the Securities and Exchange Commission on August 12, 2008
Registration No. 333-______
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3 REGISTRATION STATEMENT
Under The Securities Act Of 1933
Consumer Portfolio Services, Inc.
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(Exact name of registrant as specified in its charter)
California 33-0459135
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
16355 Laguna Canyon Road, Irvine, California 92618
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(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
Charles E. Bradley, Jr.
CONSUMER PORTFOLIO SERVICES, INC.
16355 Laguna Canyon Road
Irvine, California 92618
Telephone: (949) 753-6800, Fax: (949) 753-6897
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(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to: Alexander D. Lynch, Esq. Mitchell S. Cohen, Esq.
WEIL, GOTSHAL & MANGES LLP IRELL & MANELLA LLP
767 Fifth Avenue 1800 Avenue of the Stars, Suite 900
New York, New York 10153 Los Angeles, California 90067
Telephone: (212) 310-8971 Telephone: (310) 277-1010
Fax: (212) 310-8007 Fax: (310) 203-7199
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this registration statement as determined by
the selling shareholders.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this form is a registration statement pursuant to General Instruction I.D. or
a post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. [ ]
If this form is a post-effective amendment to a registration statement filed
pursuant to General Instruction I.D. filed to register additional securities or
additional classes of securities pursuant to Rule 413(b) under the Securities
Act, check the following box. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one)
Large accelerated filer [ ] Accelerated filer [X]
Non-accelerated filer [ ] Smaller reporting company [ ]
(Do not check if a smaller reporting company)
CALCULATION OF REGISTRATION FEE
--------------------------------- ------------------------ ----------------------- ----------------------- --------------------
Title of Each Class of Proposed Maximum Proposed Maximum
Securities to Be Amount to be Offering Price Per Aggregate Offering Amount of
Registered Registered (1) Unit (2) Price (2) Registration Fee
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Common Stock, no par value 3,725,000 shares $ 2.035 $ 7,580,375 $297.91
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(1) Includes 2,500,000 shares of common stock issuable upon exercise of an
outstanding warrant. In addition to the shares of common stock set forth in the
table above, pursuant to Rule 416 under the Securities Act, an indeterminate
number of additional shares of common stock shall be issuable to prevent
dilution resulting from stock splits, stock dividends or similar transactions,
and, in such an event, the number of shares registered hereby shall be
automatically increased to cover the additional shares.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act, based on the average of high
and low prices reported for the registrant's Common Stock by the Nasdaq Global
Market on August 8 , 2008.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until it shall file a further
amendment which specifically states that this registration statement shall
become effective in accordance with Section 8(a) of the Securities Act of 1933
or until the registration statement shall become effective on such date as the
Commission, acting pursuant to Section 8(a), may determine.
*The information in this prospectus is not complete and may be changed. We have
filed a registration statement with the Securities and Exchange Commission
relating to the common stock. The common stock may not be sold nor may offers to
buy be accepted prior to the time the registration statement becomes effective.
This prospectus is not an offer to sell the common stock, and neither we nor the
selling shareholders are soliciting offers to buy the common stock in any
jurisdiction where the offer or sale is not permitted.
Subject to Completion, dated August 12, 2008
PROSPECTUS
CONSUMER PORTFOLIO SERVICES, INC.
3,725,000 SHARES
COMMON STOCK
WHO IS OFFERING THE COMMON STOCK AND RECEIVING PROCEEDS FROM ANY SALES. The
selling shareholders identified in this prospectus may from time to time sell up
to an aggregate of 3,725,000 shares of our common stock. Of this amount,
1,225,000 shares of our common stock are held by one of the selling shareholders
and 2,500,000 shares of the common stock are issuable to the other selling
shareholder upon exercise of a currently outstanding warrant. The selling
shareholders will receive all of the proceeds from any such sales. We will not
receive any of the proceeds from the sale of the shares offered by this
prospectus, but we will receive nominal proceeds upon the cash exercise of the
warrant. See "Use of Proceeds."
HOW SALES WILL BE MADE; PRICE OF SHARES. The selling shareholders may sell
all or any portion of the shares of common stock at various times and in various
types of transactions, including sales in the open market, sales in negotiated
transactions and sales by a combination of these methods. Shares may be sold at
the market price of the common stock at the time of a sale, at prices relating
to the market price over a period of time, or at prices negotiated with the
buyers of shares. For additional information on the methods of sale, see "Plan
of Distribution."
FEES AND EXPENSES. The selling shareholders will pay all brokerage fees and
commissions and similar sale-related expenses. We are paying expenses relating
to the registration of the shares with the Securities and Exchange Commission.
WHERE OUR STOCK IS TRADED. Our common stock is traded on the Nasdaq Global
Market under the symbol "CPSS." On August 11, 2008, the last reported sale price
of our common stock on the Nasdaq Global Market was $2.00 per share.
CONTACTING US. Our principal executive offices are located at 16355 Laguna
Canyon Road, Irvine, California 92618, and our telephone number is (949)
753-6800.
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Investing in our common stock involves a high degree of risk.
See RISK FACTORS on page 3 of this prospectus.
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Neither the Securities and Exchange Commission nor any state securities
commission or regulatory authority has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
The date of this prospectus is , 2008.
TABLE OF CONTENTS
Risk Factors 3
Forward-Looking Statements 3
Use of Proceeds 3
Selling Shareholders 4
Transactions with the Selling Shareholders 4
Plan of Distribution 6
Legal Matters 8
Experts 8
Where You Can Find More Information 8
Documents Incorporated by Reference 9
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE
IN THIS PROSPECTUS. NEITHER WE NOR ANY SELLING SHAREHOLDER HAS AUTHORIZED ANY
OTHER PERSON TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE HAVE SUPPLIED ALL
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS RELATING
TO CONSUMER PORTFOLIO SERVICES, INC. AND OUR SUBSIDIARIES. EACH SELLING
SHAREHOLDER HAS SUPPLIED CERTAIN INFORMATION CONTAINED IN THIS PROSPECTUS
RELATING TO THAT SELLING SHAREHOLDER. IF ANYONE PROVIDES YOU WITH DIFFERENT OR
INCONSISTENT INFORMATION, YOU SHOULD NOT RELY ON IT. NEITHER WE NOR THE SELLING
SHAREHOLDERS ARE MAKING AN OFFER TO SELL OUR COMMON STOCK IN ANY JURISDICTION
WHERE THE OFFER OR SALE IS NOT PERMITTED. YOU SHOULD ASSUME THE INFORMATION
APPEARING IN THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED BY REFERENCE IS
ACCURATE ONLY AS OF THE DATE ON THE FRONT OF THOSE DOCUMENTS. OUR BUSINESS,
FINANCIAL CONDITION, RESULTS OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE
THAT DATE.
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RISK FACTORS
Purchase of the offered shares involves a high degree of risk. See the risk
factors described in our Annual Report on Form 10-K for the most recent fiscal
year, and any changes to those risk factors included in subsequent quarterly
reports on Form 10-Q. All of those reports are incorporated by reference in this
prospectus. The risks described in any document incorporated by reference are
not the only ones we face, but are considered to be the most significant.
Additional risks and uncertainties not presently known to us or that we
currently believe to be less significant may also adversely affect our business
and your investment in our common stock.
Before making an investment decision, you should carefully consider these
risks as well as other information we include or incorporate by reference in
this prospectus, including our financial statements and related notes. These
risks could materially affect our business, results of operations or financial
condition and cause the value of our common stock to decline. You could lose all
or part of your investment.
FORWARD-LOOKING STATEMENTS
Discussions of certain matters contained in this prospectus and
incorporated herein by reference may constitute forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and as such, may involve risks and uncertainties.
These forward-looking statements relate to, among other things, expectations of
the business environment in which we operate, projections of future performance,
perceived opportunities in the market and statements regarding our mission and
vision. You can generally identify forward-looking statements as statements
containing the words "will," "would," "believe," "may," "could," "expect,"
"anticipate," "intend," "estimate," "assume" or other similar expressions. Our
actual results, performance and achievements may differ materially from the
results, performance and achievements expressed or implied in such
forward-looking statements. The discussions of "Risk Factors" contained in our
Annual Report on Form 10-K and in certain other reports identify some of the
factors that might cause such a difference, including the following:
o changes in general economic conditions;
o changes in interest rates;
o availability or unavailability of short-term and long-term financing;
o our ability to generate sufficient operating and financing cash flows;
o competition;
o changes in the levels of losses incurred on receivables; and
o regulatory requirements.
Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions. Actual results may differ from
expectations due to many factors beyond our ability to control or predict,
including those described herein and in documents incorporated by reference in
this prospectus. For these statements, we claim the protection of the safe
harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995.
We undertake no obligation to update any forward-looking information. You
are advised to consult any additional disclosure we make in our periodic reports
filed with the Securities and Exchange Commission (the "SEC"). See "Where You
Can Find More Information" and "Documents Incorporated by Reference."
USE OF PROCEEDS
All shares of common stock sold pursuant to this prospectus will be sold by
the selling shareholders and we will not receive any of the proceeds from such
sales. Such proceeds as we may receive from the exercise of the warrant, if it
is cash exercised, will be nominal in amount, and will be used for general
corporate purposes.
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SELLING SHAREHOLDERS
The selling shareholders acquired the shares of common stock offered by
this prospectus, or the rights to acquire such shares upon exercise of warrants,
directly from us in the transactions described below under the caption
"Transactions with the Selling Shareholders." The registration of these shares
does not necessarily mean that the selling shareholders will sell all or any of
the shares. None of the selling shareholders has, or within the past three years
has had, any position, office or material relationship with us or any of our
predecessors or affiliates, except as indicated below under the caption
"Transactions with the Selling Shareholders."
The following table sets forth the names of the selling shareholders, the
number of shares of common stock beneficially owned by the selling shareholders
immediately prior to the date of this prospectus, assuming, where applicable,
exercise of the warrant in full, and the maximum number of shares that may be
offered pursuant to this prospectus. The table also provides information
regarding the beneficial ownership of our common stock by the selling
shareholders as adjusted to reflect the assumed sale of all of the shares
offered by this prospectus.
The information provided in the table below with respect to the selling
shareholders has been obtained from the selling shareholders and we have not
sought to verify this information.
Number of Shares
Number of Shares Number of Beneficially Owned
Beneficially Owned Shares Being After Completion
Selling Shareholder Prior to the Offering Offered of the Offering (3)
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Citigroup Global Markets Inc. (1) 2,500,000 2,500,000 None
Levine Leichtman Capital Partners IV, L.P. (2) 1,225,000 (4) 1,225,000 None (4)
(1) The named shareholder is an indirect wholly owned subsidiary of Citigroup
Inc. Other affiliates of Citigroup Inc. may hold, and from time to time do hold,
shares of our common stock, in fiduciary and other capacities. Such holdings are
not reported in this table, and such shares are not included in this offering.
Citigroup Financial Products Inc., Citigroup Global Markets Holdings Inc. and
Citigroup Inc. indirectly beneficially own all of the shares directly
beneficially owned by the named shareholder. The named shareholder has informed
us that it is a registered broker-dealer and acquired the warrant and underlying
shares of the common stock listed above in the ordinary course of business and
at the time of acquisition did not have any arrangements or understandings,
directly or indirectly, with any party to distribute the warrant or the shares
of common stock issuable upon exercise of the warrant. The address for the named
shareholder is 388 Greenwich Street, New York, New York 10013.
(2) The named shareholder is a Delaware limited partnership. LLCP Partners IV
GP, LLC is the sole general partner of the named shareholder, and Levine
Leichtman Capital Partners, Inc. is the sole manager of LLCP Partners IV GP,
LLC. Arthur E. Levine and Lauren B. Leichtman are the controlling shareholders
of Levine Leichtman Capital Partners, Inc. The named shareholder has informed us
that it is not a registered broker-dealer or an affiliate of a registered
broker-dealer. The address for the named shareholder and each of the persons and
entities identified in this footnote is 335 N. Maple Drive, Suite 240, Beverly
Hills, California 90210.
(3) Assumes the sale by the selling shareholders of all the shares of common
stock available for resale under this prospectus.
(4) Does not include 1,848,309 shares of common stock that may be issuable upon
exercise of certain warrants held by the named shareholder. Our obligation to
issue common stock upon exercise of such warrants is contingent upon our
obtaining the approval of our shareholders with respect to such warrants. That
approval has not been obtained as of the date of this prospectus.
We refer elsewhere to Citigroup Global Markets Inc. as the "Citigroup selling
shareholder," and to Levine Leichtman Capital Partners IV, L.P. as the "LLCP
selling shareholder."
TRANSACTIONS WITH THE SELLING SHAREHOLDERS
Each of the two selling shareholders also holds, in addition to the common
stock offered by this prospectus, certain debt securities issued by us. The LLCP
selling shareholder also holds warrants to acquire common stock. The terms and
conditions applicable to such indebtedness and warrants are described below
under the caption "Transactions with the Selling Shareholders." In addition to
such recently completed transactions, the Citigroup selling shareholder or its
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affiliates may in the future provide us with investment banking, financial
advisory, or commercial banking services, for which it may receive compensation
in such amounts and forms as may be determined by negotiation. Likewise, the
LLCP selling shareholder or its affiliates may in the future provide us with
investment banking or financial advisory services, for which it may receive
compensation in such amounts and forms as may be determined by negotiation.
TRANSACTIONS WITH THE CITIGROUP SELLING SHAREHOLDER
On July 10, 2008, we and our wholly owned subsidiary Folio Funding II, LLC,
as borrower, agreed with the Citigroup selling shareholder to amend and restate
the agreements governing a pre-existing revolving residual credit facility. The
Citigroup selling shareholder is the note purchaser and administrative agent of
that credit facility.
Under the original residual facility, we sold eligible residual interests
in securitizations to the borrower, which in turn pledged the residuals as
collateral for floating rate borrowings from the note purchaser. The amount
available for borrowing was computed by the administrative agent using a
valuation methodology of the residuals, and was subject to an overall maximum
principal amount of $120 million. The indebtedness of the borrower was
represented by (i) a $60 million Class A-1 Variable Funding Note, and (ii) a $60
million Class A-2 Term Note. The facility's revolving feature was to expire by
its terms on July 10, 2008, and the Class A-1 Note was to be due at that time.
The Class A-2 Note was to be due on July 10, 2009.
With the amendments to this facility, we prepaid a portion of the
outstanding notes, reducing the outstanding principal balance to $70 million,
and the notes have been re-designated as (i) a $10 million Class A-1 Term Note,
and (ii) a $60 million Class A-2 Term Note. Approximately $4 million of the
principal prepayment represented the Citigroup selling shareholder's purchase of
a nominal price warrant to purchase 2,500,000 shares of our common stock. The
Class A-1 Term Note and Class A-2 Term Note provide for minimum required levels
of amortization, and are due in June 2009. However, we also received an option,
if certain conditions are met, to extend the maturity for an additional year to
June 2010.
The 2,500,000 shares issuable upon exercise of the warrant described above
are the shares to be sold in this offering.
TRANSACTIONS WITH THE LLCP SELLING SHAREHOLDER
On June 30, 2008, we entered into a Securities Purchase Agreement and
related agreements with the LLCP selling shareholder, pursuant to which the LLCP
selling shareholder purchased a $10 million five-year note issued by us. The
indebtedness to the LLCP selling shareholder is secured by substantially all of
our assets, though not by the assets of our special-purpose financing
subsidiaries. Certain other subsidiaries of ours (CPS Marketing, Inc., CPS
Leasing, Inc., Mercury Finance Company LLC and TFC Enterprises LLC) have
guaranteed our obligations to the LLCP selling shareholder.
In connection with the Securities Purchase Agreement, we paid to the LLCP
selling shareholder a closing fee of $1.1 million and issued to the LLCP selling
shareholder (i) 1,225,000 shares of our common stock, (ii) a warrant that
represented the right to purchase, at the time of issuance, 275,000 shares of
our common stock, at a nominal exercise price, and (iii) a warrant that
represented the right to purchase, at the time of issuance, 1,500,000 shares of
our common stock, at an exercise price of $2.573 per share. The number of shares
subject to each warrant and the exercise price of each warrant are subject to
certain adjustments contained in the warrants. Exercise of the warrants is
contingent upon our obtaining the approval of our shareholders, which we have
agreed to seek. As an alternative to exercise of the warrants, the LLCP selling
shareholder has the right to require that we purchase all or any portion of the
warrants at a price equal to the difference between the aggregate exercise price
of the warrants so purchased, and the then prevailing market price of our common
stock.
The 1,225,000 shares issued as described above are the shares to be sold in
this offering.
Under the Securities Purchase Agreement, subject to the satisfaction of
certain terms and conditions, the LLCP selling shareholder also agreed to
purchase an additional $15 million note to be issued by us. That obligation was
subject to a number of conditions being satisfied, including, without
limitation, a successful amendment and restatement of our indebtedness to the
Citigroup selling shareholder, described above. Those conditions were satisfied
and the additional note was issued on July 10, 2008. The additional note has
substantially the same terms as the $10 million note.
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In connection with the Securities Purchase Agreement, we entered into an
Investor Rights Agreement with the LLCP selling shareholder that granted the
LLCP selling shareholder certain monitoring and other rights, including the
right to cause an individual designated by the LLCP selling shareholder to be
nominated and elected to our board of directors. In addition, the Investor
Rights Agreement granted to the LLCP selling shareholder rights of first refusal
with respect to future issuances of equity securities by us and contains
restrictions on our ability (and the ability of our subsidiaries) to issue
equity securities.
Affiliates of the LLCP selling shareholder have purchased other senior
secured debt securities from the Company, and have held as much as 4.5 million
shares of the Company's common stock, at various times prior to the transactions
described above. No such debt securities had been outstanding since July 2007,
and no such shares had been held since December 2007.
PLAN OF DISTRIBUTION
We have been advised that the shares may be offered and sold by or for the
account of the selling shareholders (or their pledges, donees, transferees, or
successors in interest), from time to time as market conditions permit, on the
Nasdaq Global Market, any other exchange on which the shares may be listed, over
the counter, or otherwise, at prices and on terms then prevailing or in
negotiated transactions, and that the shares may be sold by one or more of the
following methods, without limitation:
o purchases by underwriters, brokers, dealers, and agents who may
receive compensation in the form of o underwriting discounts,
concessions, or commissions from the selling shareholders and/or the
purchasers of the shares for whom they may act as agent;
o one or more block trades in which a broker or dealer so engaged will
attempt to sell the shares as agent, o but may position and resell a
portion of the block as principal to facilitate the transaction or, in
crosses, in which the same broker acts as agent on both sides;
o purchases by a broker or dealer (including a specialist or market
maker) as principal and resale by such broker or dealer for its
account pursuant to this prospectus;
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers;
o face-to-face transactions between sellers and purchasers without a
broker-dealer;
o the pledge of shares as security for any loan or obligation, including
pledges to brokers or dealers who may from time to time effect
distributions of the shares or other interests in the shares;
o short sales or transactions to cover short sales relating to the
shares;
o distributions to creditors, equity holders, partners, and members of
the selling shareholders;
o transactions in options, swaps, or other derivatives (whether exchange
listed or otherwise);
o sales in other ways not involving market makers or established trading
markets, including direct sales to institutions or individual
purchasers; and
o sales in other ways not involving market makers or established trading
markets, including direct sales to institutions or individual
purchasers; and
o any combination of the foregoing or by any other legally available
means.
The selling shareholders may enter into sale, forward sale, and derivative
transactions with third parties, or sell securities not covered by this
prospectus to third parties in privately negotiated transactions. If the
applicable prospectus supplement indicates, in connection with those sale,
forward sale, or derivative transactions, the third parties may sell securities
covered by this prospectus and the applicable prospectus supplement, including
in short sale transactions and by issuing securities that are not covered by
this prospectus but are exchangeable for or represent beneficial interests in
the shares. The third parties may use shares received under those sale, forward
sale, or derivative arrangements or shares pledged by the selling shareholders
or borrowed from the selling shareholders or others to settle such third party
sales or to close out any related open borrowings of shares. The third parties
may deliver this prospectus in connection with any such transactions. Any third
party in such sale transactions will be an underwriter and will be identified in
the applicable prospectus supplement (or a post-effective amendment to the
registration statement of which this prospectus forms a part). In addition, the
selling shareholders may enter into hedging transactions with broker-dealers in
connection with distributions of shares or otherwise. In those transactions,
6
broker-dealers may engage in short sales of shares in the course of hedging the
positions they assume with the selling shareholders. The selling shareholders
also may sell shares short and redeliver shares to close out such short
positions. The selling shareholders may also enter into option or other
transactions with broker-dealers that require the delivery to such
broker-dealers of the shares, which shares may be resold thereafter pursuant to
this prospectus. The selling shareholders also may loan or pledge shares, and
the borrower or pledgee may sell or otherwise transfer the shares so loaned or
pledged pursuant to this prospectus. Such borrower or pledgee also may transfer
those shares to investors in our securities or the shareholder's securities or
in connection with the offering of other securities not covered by this
prospectus. From time to time, selling shareholders may also transfer or donate
their shares and each transferee or donee will be deemed to be a selling
shareholder for purposes of this prospectus. Any pledgee, secured party,
transferee, or donee that a selling shareholder intends to offer or sell shares
to through this prospectus will be named in a prospectus supplement, if
required.
In addition, any shares of the selling shareholders covered by this
prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold in open market transactions under Rule 144 rather than pursuant to
this prospectus.
Underwriters, brokers, dealers, or agents may receive compensation in the
form of commissions, discounts, or concessions from the selling shareholders.
Underwriters, broker-dealers, or agents may also receive compensation from the
purchasers of shares for whom they act as agents or to whom they sell as
principals, or both. Compensation as to a particular underwriter, broker-dealer,
or agent might be in excess of customary commissions and will be in amounts to
be negotiated in connection with transactions involving shares. In effecting
sales, brokers or dealers engaged by the selling shareholders may arrange for
other brokers or dealers to participate.
At the time a particular offer of shares is made by one or more of the
selling shareholders, a prospectus supplement, if required, will be distributed
to set forth the terms of the specific offering of the shares, including:
o the name of the selling shareholders and other participating
broker-dealer(s);
o the number of shares offered; o the price at which such shares are
being sold;
o the proceeds to the selling shareholders from the sale of such shares;
o the specific plan of distribution for such shares;
o the names of the underwriters or agents, if any;
o any underwriting discounts, agency fees, or other compensation to
underwriters or agents;
o any discounts or concessions allowed or paid to dealers; and
o any other facts material to the transaction.
In connection with the sale of the shares, the selling shareholders and
such brokers and dealers and any other participating brokers or dealers may be
deemed to be "underwriters" within the meaning of the Securities Act in
connection with such sales. Accordingly, any profits realized by the selling
shareholders and any compensation earned by such broker-dealers or agents may be
deemed to be underwriting discounts and commissions. Because a selling
shareholder may be deemed to be an "underwriter" within the meaning of Section
2(11) of the Securities Act, the selling shareholders will be subject to the
prospectus delivery requirements of that act. We will make copies of this
prospectus (as it may be amended or supplemented from time to time) available to
the selling shareholders for the purpose of satisfying any prospectus delivery
requirements.
The selling shareholders may sell the shares covered by this prospectus
from time to time, and may also decide not to sell all or any of the shares they
are allowed to sell under this prospectus. The selling shareholders will act
independently of us in making decisions regarding the timing, manner, and size
of each sale. There can be no assurance, however, that all or any of the shares
will be offered by the selling shareholders. We know of no existing arrangements
between any selling shareholders and any broker, dealer, finder, underwriter, or
agent relating to the sale or distribution of the shares.
We will not receive any of the proceeds of any sale of shares by the
selling shareholders. We will bear all of the expenses of the registration of
this offering under the Securities Act including, without limitation,
registration and filing fees, printing expenses, fees and disbursements of our
counsel, counsel for the selling shareholders and independent public
7
accountants, transfer taxes, fees of transfer agents and registrars, and costs
of insurance, if any. All underwriting discounts, selling commissions, and
broker's fees applicable to the sale of any shares will be borne by the selling
shareholders or by such persons other than us as agreed by and among the selling
shareholders and such other persons.
We and the selling shareholders have agreed to indemnify each other against
certain liabilities under the Securities Act. In addition, we or the selling
shareholders may agree to indemnify any underwriters, brokers, dealers or agents
against, or contribute to any payments the underwriters, brokers, dealers or
agents may be required to make with respect to, civil liabilities, including
liabilities under the Securities Act. Underwriters, brokers, dealers and agents
and their affiliates are permitted to be customers of, engage in transactions
with, or perform services for us and our affiliates or the selling shareholders
and their affiliates in the ordinary course of business.
The selling shareholders will be subject to applicable provisions of the
Exchange Act and the associated rules and regulations under the Exchange Act,
including Regulation M, which provisions may limit the timing of purchases and
sales of shares by the selling shareholders. These restrictions may affect the
marketability of such shares.
In order to comply with applicable securities laws of some states, the
shares may be sold in those jurisdictions only through registered or licensed
brokers or dealers. In addition, in certain states the shares may not be sold
unless they have been registered or qualified for sale in the applicable state
or an exemption from the registration or qualification requirements is
available.
In connection with an underwritten offering of shares under this
prospectus, the underwriters may purchase and sell securities in the open
market. These transactions may include short sales, stabilizing transactions and
purchases to cover positions created by short sales. Short sales involve the
sale by the underwriters of a greater number of securities than they are
required to purchase in an offering. Stabilizing transactions consist of certain
bids or purchases made for the purpose of preventing or retarding a decline in
the market price of the securities while an offering is in progress.
The underwriters also may impose a penalty bid. This occurs when a
particular underwriter repays to the underwriters a portion of the underwriting
discount received by it because the underwriters have repurchased securities
sold by or for the account of that underwriter in stabilizing or short-covering
transactions.
These activities by the underwriters may stabilize, maintain or otherwise
affect the market price of the shares offered under this prospectus. As a
result, the price of the shares may be higher than the price that otherwise
might exist in the open market. If these activities are commenced, they may be
discontinued by the underwriters at any time. These transactions may be effected
on an automated quotation system or in the over-the-counter market or otherwise.
To the extent permitted by applicable law, this plan of distribution may be
modified in a prospectus supplement or otherwise.
LEGAL MATTERS
The validity of the common stock offered hereby will be passed upon by Mark
Creatura, our general counsel, 16355 Laguna Canyon Road, Irvine, California
92618. Mr. Creatura owns beneficially, or has rights to acquire under our
employee benefit plans, an aggregate of 1.0% of our common stock.
EXPERTS
The consolidated financial statements of Consumer Portfolio Services, Inc.
as of and for the years ended December 31, 2007 and 2006 and for each of the
three years in the period ended December 31, 2007 have been incorporated by
reference herein in reliance upon the report of McGladrey & Pullen LLP,
independent registered public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
As required by the Securities Act, we filed a registration statement
relating to the securities offered by this prospectus with the SEC. This
prospectus is a part of that registration statement. The registration statement
includes additional information. We have filed the exhibits discussed in this
prospectus with the registration statement, and you should read the exhibits
carefully for provisions that may be important to you.
8
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's Public Reference Room located at 100 F Street, N.E., Washington, D.C.
20549. You can also request copies of these documents, upon payment of a
duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330
for further information on the Public Reference Room. Our SEC filings are also
available to the public at no cost from the SEC's website at http://www.sec.gov,
or from our website at http://www.consumerportfolio.com. Other than our SEC
filings, none of the information on or hyperlinked from our website is
incorporated by reference into this prospectus.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with the SEC, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus. Information that we file with the SEC
will automatically update the information in this prospectus. In all cases, you
should rely on the later information over different information included in this
prospectus. We incorporate by reference the documents listed below and any
future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act:
(a) Annual Report on Form 10-K for the year ended December 31, 2007;
(b) Quarterly Reports on Form 10-Q for the quarters ended March 31, 2008
and June 30, 2008;
(c) Current Reports on Form 8-K filed on April 15, 2008, July 7, 2008 and
July 16, 2008 (excluding item 2.02);
(d) The information in our Definitive Proxy Statement on Schedule 14A,
filed on April 29, 2008 as amended on May 6, 2008, but only to the extent that
such information was incorporated by reference into our Annual Report on Form
10-K for the year ended December 31, 2007; and
(e) The description of our common stock contained in our registration
statement on Form 8-A filed on September 4, 1992, including any amendments or
reports filed for the purpose of updating such description.
All documents we file pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this prospectus and before the completion of the
offering of the securities described in this prospectus shall be incorporated by
reference in this prospectus from the date of filing of such documents.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address or telephone number:
Corporate Secretary
Consumer Portfolio Services, Inc.
P.O. Box 57017
Irvine, CA 92619
(949) 753-6800
9
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Set forth below are the fees and expenses expected to be paid by the registrant
in connection with the issuance and distribution of the securities registered
hereby. All amounts shown are estimates except for the SEC registration fee.
SEC registration fee $ 298
Accounting fees and expenses 2,000
Legal fees and expenses 2,000
Selling shareholders' legal fees and expenses 12,000
Printing expenses 2,000
Miscellaneous 702
-------
TOTAL $12,000
=======
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under California law, a California corporation may eliminate or limit the
personal liability of a director of the corporation for monetary damages for
breach of the director's duty of care as a director, provided that the breach
does not involve certain enumerated actions, including, among other things,
intentional misconduct or knowing and culpable violation of the law, acts or
omissions which the director believes to be contrary to the best interests of
the corporation or its shareholders or which reflect an absence of good faith on
the director's part, the unlawful purchase or redemption of stock, payment of
unlawful dividends, and receipt of improper personal benefits. The registrant's
Board of Directors believes that such provisions have become commonplace among
major corporations and are beneficial in attracting and retaining qualified
directors, and the registrant's Articles of Incorporation include such
provisions.
The registrant's Articles of Incorporation and Bylaws also impose a mandatory
obligation upon the registrant to indemnify any director or officer to the
fullest extent authorized or permitted by law (as now or hereinafter in effect),
including under circumstances in which indemnification would otherwise be at the
discretion of the registrant.
Under California law, a California corporation may purchase and maintain
insurance on behalf of any agent, including any director, officer, employee or
other agent of the corporation. The registrant's Bylaws permit the registrant to
secure insurance on behalf of any director, officer, employee or other agent of
the registrant.
The registrant provides liability insurance for its directors and officers,
which provides for coverage against loss from claims made against directors and
officers in their capacity as such, including, subject to certain exceptions,
liabilities under the federal securities laws. Such coverage indemnifies the
directors and officers of the registrant against certain liabilities, including
certain liabilities arising under the Securities Act, which might be incurred by
them in such capacities and against which they cannot be indemnified by the
registrant.
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ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following exhibits are filed herewith:
Exhibit No. Description
5.1 Opinion of Mark Creatura with respect to legality of the
securities registered
23.1 Consent of Mark Creatura (included in Exhibit 5.1)
23.2 Consent of McGladrey & Pullen LLP
24.1 Power of Attorney (included on the signature page to the
registration statement)
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post
effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) (ss.230.424(b) of Title 17 of
the Code of Federal Regulations) if, in the aggregate, the changes in volume and
price represent no more than 20% change in the maximum aggregate offering price
set forth in the "Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) above
do not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in reports filed with or furnished to
the Commission by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in this
registration statement, or is contained in a form of prospectus filed pursuant
to Rule 424(b) (ss.230.424(b) of Title 17 of the Code of Federal Regulations)
that is part of the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(4) That, for the purpose of determining liability under the Securities Act of
1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of
a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on
Rule 430A (ss.230.430A of Title 17 of the Code of Federal Regulations), shall be
deemed to be part of and included in the registration statement as of the date
it is first used after effectiveness. PROVIDED, HOWEVER, that no statement made
in a registration statement or prospectus that is part of the registration
statement or made in a document incorporated or deemed incorporated by reference
into the registration statement or prospectus that is part of the registration
statement will, as to a purchaser with a time of contract of sale prior to such
first use, supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or made in
any such document immediately prior to such date of first use.
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(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act 1933, each filing of the
registrant's annual report pursuant to section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the Exchange Act) that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Irvine, State of California, on August 11, 2008.
CONSUMER PORTFOLIO SERVICES, INC.
(Registrant)
By: /s/ Charles E. Bradley, Jr.
-----------------------------------------
Charles E. Bradley, Jr.
President and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below appoints Charles E. Bradley, Jr. and
Jeffrey P. Fritz, and each of them, with full power to act without the other,
such person's true and lawful attorneys-in-fact and agents, for him and in his
name, place and stead, in any and all capacities, to sign this Registration
Statement, and any and all pre-effective and post-effective amendments thereto
as well as any related registration statements (or amendment thereto) filed
pursuant to Rule 462(b) promulgated by the Securities Act of 1933, as amended,
and to file the same, with exhibits and schedules thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing necessary or desirable
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement on Form S-3 has been signed by the following persons in
the capacities and on the dates indicated below.
Signature Title Date
--------- ----- ----
/s/ Charles E. Bradley, Jr. August 11, 2008
----------------------------
Charles E. Bradley, Jr. Chairman of the Board of Directors, President and Chief
Executive Officer (Principal Executive Officer)
/s/ Jeffrey P. Fritz August 11, 2008
----------------------------
Jeffrey P. Fritz Sr. Vice President (Principal Financial and Accounting
Officer)
/s/ Chris A. Adams August 11, 2008
----------------------------
Chris A. Adams Director
/s/ E. Bruce Fredrikson August 11, 2008
----------------------------
E. Bruce Fredrikson Director
/s/ John C. Warner August 11, 2008
----------------------------
John C. Warner Director
/s/ William B. Roberts August 11, 2008
----------------------------
William B. Roberts Director
/s/ Gregory S. Washer August 11, 2008
----------------------------
Gregory S. Washer Director
/s/ Daniel S. Wood August 11, 2008
----------------------------
Daniel S. Wood Director
/s/ Brian J. Rayhill August 11, 2008
----------------------------
Brian J. Rayhill Director
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EXHIBIT INDEX
Exhibit No. Description
----------- -----------
5.1 Opinion of Mark Creatura with respect to legality of the
securities registered
23.1 Consent of Mark Creatura (included in Exhibit 5.1)
23.2 Consent of McGladrey & Pullen LLP
24.1 Power of Attorney (included on the signature page to the
registration statement)
II-5