SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13E-3
(Amendment No. 3)
(Rule 13e-100)
TRANSACTION STATEMENT UNDER
SECTION 13(e) OF THE SECURITIES EXCHANGE ACT OF 1934 AND
RULE 13e-3 THEREUNDER
Rule 13e-3 Transaction Statement under Section 13(e)
of the Securities Exchange Act of 1934
ASTA FUNDING, INC.
Name of Subject Company (Issuer)
Asta Funding, Inc.
Asta Finance Acquisition Inc.
Asta Finance Acquisition Sub Inc.
Gary M. Stern, Ricky Stern, Arthur Stern, Emily Stern,
GMS Family Investors LLC, Asta Group, Incorporated,
The Ricky Stern Family 2012 Trust, The Ricky Stern
2012 GST Trust,
The Emily Stern Family 2012 Trust, The Emily Stern
2012 GST Trust
(Names of Persons Filing Statement)
Common Stock, Par Value $0.01 Per Share
(Title of Class of Securities)
0462220109
(CUSIP Number of Class of Securities)
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Seth Berman
General Counsel
Asta Funding, Inc.
210 Sylvan Avenue
Englewood Cliffs, NJ 07632
(201) 567-5648
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Gary M. Stern
c/o Moomjian Waite & Coleman, LLP
350 Jericho Turnpike
Jericho, NY 11753
(516) 937-5900
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(Name, address, and telephone numbers of person authorized to
receive notices and communications on behalf of filing
persons)
With copies to:
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James Rieger, Esq.
Ralph Siciliano, Esq.
Tannenbaum Helpern Syracuse &
Hirschtritt LLP
900 Third Avenue
New York, NY 10022
Telephone: (212) 508-6700
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Scott Jones, Esq.
Troutman Pepper Hamilton Sanders LLP
400 Berwyn Park
899 Cassatt Road
Berwyn, Pennsylvania 19312
Telephone: (610) 640-7800
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Kevin Waite, Esq.
Moomjian, Waite & Coleman, LLP
350 Jericho Turnpike
Jericho, NY 11753
Telephone: (516) 937-5900
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This statement is filed in connection with (check the appropriate
box):
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a.
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The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under
the Securities Exchange Act of 1934.
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b.
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The filing of a registration statement under the Securities Act of
1933.
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c.
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A tender offer.
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d.
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None of the above.
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Check the following box if the soliciting materials or information
statement referred to in checking box (a) are preliminary copies:
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Check the following box if the filing is a final amendment
reporting the results of the transaction: ☐
Calculation of Filing Fee
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Transaction valuation*
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Amount of filing fee**
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$34,839,292.35
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$4,522.14
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*
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Calculated solely for the purpose of determining the filing fee in
accordance with Rule 0-11(b)(1) under the Securities Exchange Act
of 1934, as amended. The transaction value is based on the sum of
(a) the aggregate cash payment for the proposed per share cash
payment of $13.10 for 2,508,854 shares of common stock issued and
outstanding (excluding shares of company stock options) as of
August 25, 2020 (consisting of 6,974,632 shares of common stock
outstanding as of August 25, 2020 minus 4,058,911 shares held
by the Stern Group (as defined below) (the “Rollover Shares”)) (the
Rollover Shares that are not included in the foregoing calculation
have been so excluded because they are being contributed to Parent
(as defined below) immediately prior to the consummation of the
merger), plus (b) the product of (i) 406,867 shares of common stock
underlying outstanding employee stock options with an exercise
price of $13.10 or less, multiplied by (ii) $4.85, representing the
difference between the $13.10 per share merger consideration and
the $8.25 weighted average exercise price of such options.
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**
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The filing fee was calculated in accordance with Rule 0-11 under
the Securities and Exchange Act of 1934, as amended, by multiplying
the transaction value by 0.0001298.
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Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee
was previously paid. Identify the previous filing by registration
statement number, or the form or schedule and date of its
filing.
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Amount Previously Paid: $4,522.14
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Filing Party: Asta Funding, Inc.
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Form or Registration No.: Schedule 14A – Amendment No.2
to the Preliminary Proxy Statement
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Date Filed: August 14, 2020
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THIS
TRANSACTION, PASSED UPON THE MERITS OR FAIRNESS OF THIS
TRANSACTION, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE
DISCLOSURE IN THIS SCHEDULE 13E-3. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE
Introduction
This Amendment No.3 to Rule 13E-3 Transaction Statement on
Schedule 13E-3, together with the exhibits thereto (the
“Transaction Statement”) is being filed with the Securities and
Exchange Commission (the “SEC”) pursuant to Section 13(e) of the
Securities Exchange Act of 1934, as amended (together with the
rules and regulations promulgated thereunder, the “Exchange Act”)
jointly by the following persons (each, a “Filing Person,” and
collectively, the “Filing Persons”): (i) Asta Funding, Inc., a
Delaware corporation (the “Company”) and the issuer of the common
stock, par value $0.01 per share (the “Common Stock”) that is
subject to the Rule 13E-3 transaction, (ii) Asta Finance
Acquisition Inc., a Delaware corporation (“Parent”), (iii) Asta
Finance Acquisition Sub Inc., a Delaware corporation and
wholly-owned subsidiary of Parent (“Merger Sub” and, together with
Parent, the “Parent Parties”), (iv) Mr. Gary M. Stern, an
individual and Chairman and Chief Executive Officer of the Company,
(v) Ricky Stern, an individual and Senior Vice President of the
Company’s GAR subsidiary, (vi) Arthur Stern, an individual and the
former Chairman Emeritus and former director of the Company, (vii)
Emily Stern, an individual, (viii) GMS Family Investors LLC, a
Delaware limited liability company (“GMS”), (ix) Asta Group,
Incorporated, a Delaware corporation (“AGI”), (x) the Ricky Stern
Family 2012 Trust (“RSFT”), (xi) the Ricky Stern 2012 GST Trust
(the “RS GST Trust”), (xii) the Emily Stern Family 2012 Trust
(“ESFT”) and (xiii) the Emily Stern 2012 GST Trust (the “ES GST
Trust” and, together with Messrs. Gary M. Stern, Ricky Stern,
Arthur Stern, Miss Emily Stern, GMS, AGI, RSFT, RS GST Trust and
ESFT, the “Stern Group Investors” or the “Stern Group”).
On April 8, 2020, the Company, Parent and Merger Sub entered into
an Agreement and Plan of Merger, as amended by that certain
Amendment No.1 to the Agreement and Plan of Merger, dated June 25,
2020, (together, the “Merger Agreement”), pursuant to which Merger
Sub shall merge with and into the Company and its consolidated
subsidiaries, with the Company surviving the Merger as a
wholly-owned subsidiary of Parent (the “Merger”). Concurrently with
the filing of this Transaction Statement, the Company is filing
with the Securities and Exchange Commission its definitive proxy
statement (the “Proxy Statement”) under Regulation 14A of the
Exchange Act, relating to a virtual special meeting of the
stockholders of the Company at which the holders of the Common
Stock will be asked to consider and vote on a proposal to adopt the
Merger Agreement. The adoption of the Merger Agreement by the
affirmative vote of the holders of (i) at least a majority of the
outstanding shares of Common Stock entitled to vote thereon and
(ii) at least a majority of the outstanding shares of Common Stock
entitled to vote thereon, other than the Parent, Gary Stern and
members of the Stern Group, and any other officers and directors of
the Company and any other person having any equity interest in, or
any right to acquire any equity interest in, Merger Sub or any
person of which Merger Sub is a direct or indirect subsidiary. A
copy of the Proxy Statement is attached hereto as Exhibit (a)(2)(i)
and a copy of the Merger Agreement is attached as Annex A to the
Proxy Statement.
Under the terms of the Merger Agreement, at the effective time of
the Merger, each share of common stock of the Company (the “Common
Stock”) outstanding immediately prior to the effective time of the
merger (other than certain excluded shares and shares held by any
of the Company’s stockholders who are entitled to and properly
exercise appraisal rights under Delaware law (“dissenting shares”))
will be converted into the right to receive $13.10 in cash, without
interest (the “merger consideration”), less any applicable
withholding taxes, whereupon all such shares will be automatically
canceled and will cease to exist, and the holders of such shares
will cease to have any rights with respect thereto other than the
right to receive the merger consideration. Shares of Common Stock
held by any of the Parent Parties (including the shares held by the
members of the Stern Group, which shares will be contributed to
Parent prior to the merger) and by the Company or any wholly-owned
subsidiary of the Company will not be entitled to receive the
merger consideration.
Except as otherwise agreed to in writing prior to the Effective
Time of the Merger by Parent and a holder of any Company stock
options with respect to any of such holder’s Company stock options,
each Company stock option, whether vested or unvested and whether
with an exercise price per share that is greater or less than, or
equal to, $13.10, that is outstanding immediately prior to the
Effective Time, will, as of the Effective Time, become fully vested
and be canceled and converted into the right to receive an amount
in cash from the Company as the surviving corporation equal to (a)
the product of (i) the excess, if any, of $13.10 over the exercise
price per share of the Common Stock subject to such Company stock
option multiplied by (ii) the total number of shares of the Common
Stock subject to such Company stock option, without interest, less
(b) such amounts as are required to be withheld or deducted under
applicable tax provisions.
As of August 25, 2020, the members of the Stern Group hold
4,058,911 shares of the Company’s Common Stock representing
approximately 61.8% of the Company’s total issued and outstanding
Common Stock (including (i) 260,000 shares subject to Company stock
options exercisable within 60 days), and have agreed with Parent to
contribute to Parent, immediately prior to the consummation of the
merger, 4,058,911 shares in exchange for common stock of
Parent.
The board of directors of the Company formed a special committee
comprised entirely of independent and disinterested directors,
consisting of David Slackman (Chairman), Michael Monteleone, and
Timothy Bishop (the “Special Committee”) to consider and negotiate
the terms and conditions of the merger and to recommend to the
board of directors whether to pursue the merger and, if so, on what
terms and conditions.
The cross-references below are being supplied pursuant to General
Instruction G to Schedule 13E-3 and show the location in the Proxy
Statement of the information required to be included in response to
the items of Schedule 13E-3. Pursuant to General Instruction F to
Schedule 13E- 3, the information contained in the Proxy Statement,
including all annexes thereto, is incorporated by reference herein
in its entirety, and the responses to each item in this Transaction
Statement are qualified in their entirety by the information
contained in the Proxy Statement and the annexes thereto.
Capitalized terms used but not defined in this Transaction
Statement shall have the meanings given to them in the Proxy
Statement.
While each of the Filing Persons acknowledges that the Merger is a
going private transaction for purposes of Rule 13E-3 under the
Exchange Act, the filing of this Transaction Statement shall not be
construed as an admission by any Filing Person, or by any affiliate
of a Filing Person, that the Company is “controlled” by any other
Filing Person.
All information contained in, or incorporated by reference into,
this Transaction Statement concerning each Filing Person has been
supplied by such Filing Person.
Item 1. Summary Term Sheet
The information set forth in the Proxy Statement under the
following captions is incorporated herein by reference:
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
Item 2. Subject Company Information
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(a)
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Name and Address. The information set forth in
the Proxy Statement under the following caption is incorporated
herein by reference:
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“SUMMARY TERM SHEET—Parties to the Merger—Asta Funding,
Inc.”
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(b)
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Securities. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
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“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING, INC.”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT”
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(c)
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Trading Market and Price. The
information set forth in the Proxy Statement under the following
caption is incorporated herein by reference:
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“IMPORTANT INFORMATION REGARDING ASTA—Market Price of the Common
Stock and Dividend Information”
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(d)
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Dividends. The information set forth in the Proxy Statement
under the following caption is incorporated herein by
reference:
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“THE MERGER AGREEMENT—Conduct of Business Prior to Closing”
“IMPORTANT INFORMATION REGARDING ASTA—Market Price of the Common
Stock and Dividend Information—Dividends”
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(e)
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Prior Public Offerings. Not Applicable.
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(f)
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Prior Stock Purchases. The information set
forth in the Proxy Statement under the following caption is
incorporated herein by reference:
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“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
—Transactions in Common Stock”
Item 3. Identity and Background of Filing Person
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(a)
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Name and Address. Asta Funding, Inc. is the
subject company. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET—Parties to the Merger”
“SPECIAL FACTORS —Parties to the Merger”
“IMPORTANT INFORMATION REGARDING ASTA”
“IMPORTANT INFORMATION REGARDING THE PARENT PARTIES AND THE STERN
GROUP”
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(b)
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Business and Background of
Entities. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET — Parties to the Merger”
“SPECIAL FACTORS — Parties to the Merger”
“IMPORTANT INFORMATION REGARDING ASTA—Company Background”
“IMPORTANT INFORMATION REGARDING THE PARENT PARTIES AND THE STERN
GROUP”
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(c)
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Business and Background of
Natural Persons. The information set forth in the
Proxy Statement under the following captions is incorporated herein
by reference:
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“IMPORTANT INFORMATION REGARDING ASTA—Directors, Executive Officers
and Corporate Governance”
“IMPORTANT INFORMATION REGARDING THE PARENT PARTIES AND THE STERN
GROUP”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT”
Item 4. Terms of the Transaction
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(1)
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Tender Offers. Not applicable.
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(2)
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Mergers or Similar Transactions. The
information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
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“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Material U.S. Federal Income Tax Consequences of
the Merger”
“SPECIAL FACTORS—U.S. Holders; Non-U.S. Holders”
“SPECIAL FACTORS—Merger Consideration”
“SPECIAL FACTORS—Payment for the Shares of Common Stock”
“SPECIAL FACTORS—Delisting and Deregistration of our Common
Stock”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING, INC
—Votes Required”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Appraisal Rights”
“THE MERGER AGREEMENT”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO THE AGREEMENT AND PLAN OF MERGER
Accounting Treatment
Asta Funding, Inc., as the surviving corporation in the merger,
will account for the merger under the acquisition method of
accounting for business combinations in accordance with generally
accepted accounting principles in the United States of America
(“U.S. GAAP”).
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(c)
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Different Terms. The information set forth in the
Proxy Statement under the following captions is incorporated herein
by reference:
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“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Financing the Merger”
“SPECIAL FACTORS—Indemnification and Directors’ and Officers’
Liability Insurance”
“SPECIAL FACTORS —Voting Agreements”
“SPECIAL FACTORS—Stern Group Commitment Letters”
“THE MERGER AGREEMENT—Treatment of Options”
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(d)
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Appraisal Rights. The information set forth in the
Proxy Statement under the following captions is incorporated herein
by reference:
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“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Appraisal Rights”
ANNEX D—DELAWARE GENERAL CORPORATION LAW SECTION 262
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(e)
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Provisions for Unaffiliated Security
Holders. None.
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(f)
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Eligibility for Listing or
Trading. Not applicable.
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Item 5. Past Contacts, Transactions, Negotiations and
Agreements
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(a)
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Transactions. The information set forth in the Proxy
Statement under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Financing the Merger”
“SPECIAL FACTORS—Voting Agreements”
“SPECIAL FACTORS—Stern Group Commitment Letters”
“THE MERGER AGREEMENT”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT—Transactions in Common Stock”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
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(b)—(c)
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Significant Corporate Events;
Negotiations or Contacts. The information set
forth in the Proxy Statement under the following captions is
incorporated herein by reference:
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“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Management Estimates”
“THE MERGER AGREEMENT”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
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(e)
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Agreements Involving the Subject
Company’s Securities. The information set forth in
the Proxy Statement under the following captions is incorporated
herein by reference:
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“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Financing the Merger”
“SPECIAL FACTORS—Voting Agreements”
“VIRTUAL SPECIAL MEETING OF THE STOCKHOLDERS OF ASTA FUNDING,
INC.—Votes Required”
“THE MERGER AGREEMENT”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
Item 6. Purposes of the Transaction, and Plans or
Proposals
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(b)
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Use of Securities Acquired. The
information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
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“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Delisting and Deregistration of Our Common
Stock”
“THE MERGER AGREEMENT—The Merger
“THE MERGER AGREEMENT—Merger Consideration”
“THE MERGER AGREEMENT—Payment for the Shares of Common Stock”
“THE MERGER AGREEMENT—Treatment of Options”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
(c)(1)—(8) Plans. The information set forth in the Proxy
Statement under the following captions is incorporated herein by
reference:
“SUMMARY TERM SHEET”
“SUMMARY TERM SHEET – The Purpose of the Virtual Special Meeting of
Stockholders”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Delisting and Deregistration of Company Common
Stock”
“SPECIAL FACTORS—Financing the Merger”
“SPECIAL FACTORS—Stern Group Commitment Letters”
“SPECIAL FACTORS—Indemnification and Directors’ and Officers’
Liability Insurance”
“IMPORTANT INFORMATION REGARDING ASTA—Dividends”
“THE MERGER AGREEMENT”
“THE MERGER AGREEMENT—The Merger”
“THE MERGER AGREEMENT—Treatment of Options”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
Item 7. Purposes, Alternatives, Reasons and Effects
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(a)
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Purposes. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
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(b)
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Alternatives. None. Additionally, the information set forth
in the Proxy Statement under the following captions is incorporated
herein by reference:
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“SPECIAL FACTORS—Background of the Merger”
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(c)
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Reasons. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Opinion of the Financial Advisor to the Special
Committee of Our Board of Directors”
“SPECIAL FACTORS—Management Estimates”
ANNEX C—OPINION OF LINCOLN INTERNATIONAL LLC
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(d)
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Effects. The information set forth in the Proxy
Statement under the following captions is incorporated herein by
reference:
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“SUMMARY TERM SHEET
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Certain Effects of the Merger”
“SPECIAL FACTORS—Material U.S. Federal Income Tax Consequences of
the Merger”
“SPECIAL FACTORS—U.S. Holders”
“SPECIAL FACTORS—Non-U.S. Holders”
“SPECIAL FACTORS—Fees and Expenses”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING, INC.—
Appraisal Rights”
“THE MERGER AGREEMENT—The Merger”
“THE MERGER AGREEMENT—Closing; Effective Time”
“THE MERGER AGREEMENT—Merger Consideration”
“THE MERGER AGREEMENT— Payment for the Shares of Common Stock”
“THE MERGER AGREEMENT—Treatment of Options”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
ANNEX D—DELAWARE GENERAL CORPORATION LAW SECTION 262
Item 8. Fairness of the Transaction
(a)—(b) Fairness; Factors Considered in
Determining Fairness. The information set forth in
the Proxy Statement under the following captions is incorporated
herein by reference:
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Parent Parties’ and the Stern Group’s Position as
to the Fairness of the Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Stern Group for the
Merger”
“SPECIAL FACTORS—Opinion of the Financial Advisor to the Special
Committee of Our Board of Directors”
“SPECIAL FACTORS—Management Estimates”
ANNEX C—OPINION OF LINCOLN INTERNATIONAL LLC
The presentations and discussion materials dated December 30, 2019,
January 16, 2020, March 13, 2020, April 8, 2020 and June 19, 2020,
each prepared by Lincoln International LLC and reviewed by the
Special Committee of the Board of the Directors of the Company, as
applicable, are attached hereto as Exhibits (c)(2), (c)(3), (c)(4),
(c)(5) and (c)(6) and are incorporated by reference herein
| |
(c)
|
Approval of Security Holders. The
information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
|
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Record Date; Shares Entitled to Vote; Outstanding Shares”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Quorum; Abstentions; Broker Non-Votes”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Votes Required”
“THE MERGER AGREEMENT—Conditions to the Merger”
“THE MERGER AGREEMENT—Stockholders Meeting”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
| |
(d)
|
Unaffiliated Representative. The information set
forth in the Proxy Statement under the following captions is
incorporated herein by reference:
|
“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Opinion of the Financial Advisor to the Special
Committee of Our Board of Directors”
ANNEX C—OPINION OF LINCOLN INTERNATIONAL LLC
| |
(e)
|
Approval of Directors. The information set
forth in the Proxy Statement under the following captions is
incorporated herein by reference:
|
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING,
INC.—Recommendation of our Board of Directors”
(f) Other Offers. Not
applicable.
Item 9. Reports, Opinions, Appraisals and Negotiations
| |
(a)—(c)
|
Report, Opinion or Appraisal;
Preparer and Summary of the
Report, Opinion or Appraisal;
Availability of Documents. The information set
forth in the Proxy Statement under the following captions is
incorporated herein by reference:
|
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Opinion of the Financial Advisor to the Special
Committee of Our Board of Directors”
“WHERE YOU CAN FIND MORE INFORMATION”
ANNEX C—OPINION OF LINCOLN INTERNATIONAL LLC
The presentations and discussion materials dated December 30, 2019,
January 16, 2020, March 13, 2020, April 8, 2020 and June 19, 2020,
each prepared by Lincoln International LLC and reviewed by the
Special Committee of the Board of the Directors of the Company, as
applicable, are attached hereto as Exhibits (c)(2), (c)(3), (c)(4),
(c)(5) and (c)(6), and are incorporated by reference herein.
Item 10. Source and Amounts of Funds or Other
Consideration
| |
(a)—(b), (d)
|
Source of Funds; Conditions;
Borrowed Funds. The information set forth in the
Proxy Statement under the following caption is incorporated herein
by reference:
|
“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Financing the Merger”
“SPECIAL FACTORS—Stern Group Commitment Letters”
“THE MERGER AGREEMENT—Financing the Merger”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
| |
(c)
|
Expenses. The information set forth in the Proxy Statement
under the following captions is incorporated herein by
reference:
|
“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger—Payments to the Special Committee”
“SPECIAL FACTORS—Fees and Expenses”
“THE MERGER AGREEMENT—Termination Fees and Expenses;
“THE MERGER AGREEMENT—Termination Fees and Expenses—Reimbursement
of Expenses”
Item 11. Interest in Securities of the Subject Company
| |
(a)
|
Securities Ownership. The information set forth in
the Proxy Statement under the following caption is incorporated
herein by reference:
|
“SUMMARY TERM SHEET”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT”
ANNEX A—AGREEMENT AND PLAN OF MERGER
ANNEX B—AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
| |
(b)
|
Securities Transactions. The information set forth in
the Proxy Statement under the following captions is incorporated
herein by reference:
|
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
—Transactions in Common Stock”
Item 12. The Solicitation or Recommendation
| |
(d)
|
Intent to Tender or Vote
in a Going-Private Transaction. The
information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
|
“SUMMARY TERM SHEET”
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
“SPECIAL FACTORS—Voting Agreements”
“VIRTUAL SPECIAL MEETING OF THE STOCKHOLDERS—Votes Required”
“SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT”
| |
(e)
|
Recommendations of Others. The information set
forth in the Proxy Statement under the following captions is
incorporated herein by reference:
|
“QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Purposes and Reasons of the Company for the
Merger”
“SPECIAL FACTORS—Purposes and Reasons of the Parent Parties and the
Stern Group for the Merger”
Item 13. Financial Statements
| |
(a)
|
Financial Information. The information set forth in
the Proxy Statement under the following captions is incorporated
herein by reference:
|
“SPECIAL FACTORS—Management Estimates”
“IMPORTANT INFORMATION REGARDING ASTA—Selected Summary Historical
Consolidated Financial Data”
“IMPORTANT INFORMATION REGARDING ASTA—Book Value Per Share”
“WHERE YOU CAN FIND ADDITIONAL INFORMATION”
| |
(b)
|
Pro Forma Information. Not applicable.
|
Item 14. Persons/Assets, Retained, Employed, Compensated or
Used
| |
(a)—(b)
|
Solicitations or Recommendations;
Employees and Corporate Assets. The
information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
|
“QUESTIONS & ANSWERS ABOUT THE SPECIAL MEETING AND THE
MERGER”
“SPECIAL FACTORS—Background of the Merger”
“SPECIAL FACTORS—Interests of Our Directors and Executive Officers
in the Merger”
“SPECIAL FACTORS—Recommendation of Our Board of Directors”
“SPECIAL FACTORS—Reasons for the Merger and Recommendation of Our
Board of Directors”
“SPECIAL FACTORS—Fees and Expenses”
“VIRTUAL SPECIAL MEETING OF STOCKHOLDERS OF ASTA FUNDING, INC
—Solicitation of Proxies”
“THE MERGER AGREEMENT—Employee Matters”
Item 15. Additional Information
| |
(b)
|
Golden Parachute Compensation. Not
applicable.
|
| |
(c)
|
Other Material Information. The entirety of
the Proxy Statement, including all annexes thereto, is incorporated
herein by reference.
|
Item 16. Exhibits
|
|
(a)(2)(i)
|
Definitive Proxy Statement of Asta
Funding, Inc. (the “Proxy Statement”) (incorporated by reference to
the Schedule 14A filed concurrently with this Transaction Statement
with the Securities and Exchange Commission).
|
|
|
(a)(2)(ii)
|
Form of Proxy Card (included in
the Proxy Statement and incorporated herein by
reference).
|
|
|
(a)(2)(iii)
|
Letter to Stockholders (included in
the Proxy Statement and incorporated herein by reference).
|
|
|
(a)(2)(iv)
|
Notice of Virtual Special Meeting of
Stockholders (included in the Proxy Statement and incorporated
herein by reference).
|
|
|
(a)(2)(v) |
Press Release issued by Asta Funding,
Inc., dated April 8, 2020 (included as Exhibit 99.1 to the
Company’s Current Report on Form 8-K, filed on April 8, 2020, and
incorporated herein by reference). |
|
|
(a)(2)(vi)
|
Press Release issued by Asta Funding,
Inc., dated June 25, 2020 (included as Exhibit 99.1 to the
Company’s Current Report on Form 8-K, filed on June 25, 2020, and
incorporated herein by reference)
|
|
|
(b)(1)
|
Debt Commitment Letter, dated April
3, 2020, by and between Bank Leumi USA and Asta Finance
Acquisition, Inc.*
|
|
|
(b)(2)
|
Amendment to the Debt Commitment
Letter, dated June 25, 2020, by and between Bank Leumi USA and Asta
Finance Acquisition, Inc. (included as Exhibit 99.2 to the
Company's Schedule 13D/A filed on June 26, 2020, and incorporated
herein by reference)
|
|
|
(b)(3) |
Amendment to the
Debt Commitment Letter, dated August 25, 2020, by and between Bank
Leumi USA and Asta Finance Acquisition, Inc. |
|
|
(c)(1)
|
Opinion of Lincoln International LLC,
dated June 19, 2020 (included as Annex C to the Proxy Statement,
and incorporated herein by reference).
|
|
|
(c)(2)
|
Presentation Materials, dated
December 30, 2019, of Lincoln International LLC to the Special
Committee of the Board of Directors of the Company.*
|
|
|
(c)(3)
|
Presentation Materials, dated January
16, 2020, of Lincoln International LLC to the Special Committee of
the Board of Directors of the Company.*
|
|
|
(c)(4)
|
Presentation Materials, dated March
13, 2020, of Lincoln International LLC to the Special Committee of
the Board of Directors of the Company.*
|
|
|
(c)(5)
|
Presentation Materials, dated April
8, 2020, of Lincoln International LLC to the Special Committee of
the Board of Directors of the Company.*
|
|
|
(c)(6)
|
Presentation Materials, dated June
19, 2020, of Lincoln International LLC to the Special Committee of
the Board of Directors of the Company.*
|
|
|
(d)(1)
|
Agreement and Plan of Merger, dated
as of April 8, 2020, by and among Asta Finance Acquisition, Inc.,
Asta Finance Acquisition Sub Inc. and Asta Funding, Inc. (included
as Annex A to the Proxy Statement, and incorporated herein by
reference).
|
|
|
(d)(2)
|
Amendment No.1 to the Agreement and
Plan of Merger, dated as of June 25, 2020, by and among Asta
Finance Acquisitions, Inc., Asta Finance Acquisition Sub Inc., and
Asta Funding, Inc. (included as Exhibit 2.1 to the Company’s
Current Report on Form 8-K, filed on June 25, 2020, and
incorporated herein by reference).
|
|
|
(d)(3)
|
Voting Agreement between the Stern
Group and Asta Funding, Inc. dated April 8, 2020 (included as
Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on
April 8, 2020, and incorporated herein by reference).
|
|
|
(d)(4)
|
Settlement and Voting Agreement
between RBF Capital, LLC and the Company, dated June 25, 2020
(included as Exhibit 10.1 to the Company’s Current Report on Form
8-K, filed on June 25, 2020, and incorporated herein by
reference).
|
|
|
(d)(5)
|
The Stern Group Commitment Letter,
dated as of April 8, 2020, by and among the Stern Group Investors
and Asta Finance Acquisition Inc. (included as Exhibit 10.2 to the
Company’s Current Report on Form 8-K, filed on April 8, 2020, and
incorporated herein by reference).
|
|
|
(d)(6)
|
Limited Guarantee dated April 8, 2020
(included as Exhibit 10.3 to the Company’s Current Report on Form
8-K, filed on April 8, 2020, and incorporated herein by
reference).
|
|
|
(f)
|
Section 262 of the Delaware General
Corporation Law (included as Annex D to the Proxy Statement, and
incorporated herein by reference).
|
|
|
(g)
|
None.
|
* Previously
filed.
SIGNATURE
After due inquiry and to the best of each of the undersigned’s
knowledge and belief, each of the undersigned certifies that the
information set forth in this statement is true, complete and
correct.
Dated as of August 25, 2020
|
|
THE COMPANY
ASTA FUNDING, INC.
By: /s/ Steven Leidenfrost
Name: Steven Leidenfrost
Title: Chief Financial Officer
By: /s/ Seth Berman
Name: Seth Berman
Title: General Counsel and Secretary
PARENT PARTIES
ASTA FINANCE ACQUISITION INC.
By: /s/ Gary Stern
Name: Gary Stern
Title: CEO and President
ASTA FINANCE ACQUISITION SUB INC.
By: /s/ Gary Stern
Name: Gary Stern
Title: CEO and President
STERN GROUP INVESTORS:
/s/ Gary Stern
Gary Stern
/s/ Ricky Stern
Ricky Stern
/s/ Emily Stern
Emily Stern
/s/ Arthur Stern
Arthur Stern
GMS FAMILY INVESTORS LLC
By: /s/ Ricky Stern
Name: Ricky Stern
Title: Managing Member
|
|
|
RICKY STERN FAMILY 2012 TRUST
By: /s/ Ricky Stern
Name: Ricky Stern
Title: Trustee
RICKY STERN 2012 GST TRUST
By: /s/ Ricky Stern
Name: Gary Stern
Title: Trustee
EMILY STERN FAMILY 2012 TRUST
By: /s/ Ricky Stern
Name: Ricky Stern
Title: Trustee
EMILY STERN 2012 GST TRUST
By: /s/ Gary Stern
Name: Gary Stern
Title: Trustee
ASTA GROUP INCORPORATED
By: /s/ Gary Stern
Name: Gary Stern
Title: CEO and President
|
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