Item 1.01
|
Entry Into A Material Definitive Agreement.
|
As previously disclosed, on July 2, 2015, Santander
Consumer USA Holdings Inc. (SC) announced the departure of Thomas G. Dundon from his roles as the Chairman of SCs Board of Directors and Chief Executive Officer of SC, effective as of the close of business on July 2, 2015. On
the date of his departure, among other things, Mr. Dundon entered into a Separation Agreement with SC, DDFS LLC (DDFS), Santander Holdings USA, Inc. (SHUSA), Santander Consumer USA Inc. (SCs wholly-owned
subsidiary) and Banco Santander, S.A. (Banco Santander, and such agreement, the Separation Agreement). The Separation Agreement, along with the related Second Amendment to Shareholders Agreement, were filed as Exhibits 10.2
and 10.1 to the Form
8-K
filed by SC on July 2, 2015.
On September 7, 2016, SC filed a Form
8-K
disclosing a Second Amendment to the Separation Agreement and Third Amendment to Shareholders Agreement (the Third Amendment) filed as Exhibits 10.1 and 10.2 thereto, respectively.
The Separation Agreement (as amended) provided for certain payments and benefits to Mr. Dundon as well as the delivery by SHUSA of an irrevocable notice
to exercise the call option with respect to all the shares of SC common stock owned by DDFS and consummate the transactions contemplated by such call option notice, subject to required bank regulatory approvals and any other approvals required by
law being obtained (the Call Transaction). On August 31, 2016, Banco Santander exercised its option to assume SHUSAs obligation to purchase such shares of SC common stock in respect of the Call Transaction.
On November 15, 2017, the parties to the Separation Agreement entered into a settlement agreement and release (the Settlement Agreement)
that, among other things, altered certain portions of the economic arrangements set forth in the Separation Agreement. Pursuant to the Settlement Agreement, (i) the amounts payable by SC to Mr. Dundon were reduced by $50,000,000 to
$66,114,588, and (ii) Banco Santander confirmed its prior commitment to complete the Call Transaction. The Call Transaction was consummated at the aggregate price of $941,945,420, representing the aggregate of the previously agreed price per SC
share of $26.17, as set forth in the Third Amendment, plus the amount due under Section 5(f) of the Separation Agreement. The Settlement Agreement includes mutual releases. All transactions contemplated by the Settlement Agreement, including
the Call Transaction, were completed on November 15, 2017.
On November 15, 2017, Banco Santander contributed the 34,598,506 shares of SCs
common stock purchased from DDFS LLC in the Call Transaction to SHUSA. SHUSA currently owns a total of 245,593,555 shares of SC common stock, representing approximately 68.3% of SCs outstanding shares.
The foregoing summary of the terms of the Settlement Agreement does not purport to be complete and is qualified in its entirety by reference to the Settlement
Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference and made a part hereof.