kl08035.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
12b-25
NOTIFICATION
OF LATE FILING
(Check
One): [_]
Form 10-K [_] Form
20-F [_] Form
11-K [X] Form
10-Q
[_] Form 10D
[_] Form
N-SAR [_] Form
N-CSR
For
Period Ended: June 30, 2008
[_] Transition
Report on Form 10-K
[_] Transition
Report on Form 20-F
[_] Transition
Report on Form 11-K
[_] Transition
Report on Form 10-Q
[_] Transition
Report on Form N-SAR
For the
Transition Period Ended: _________________________
Read
attached instruction sheet before preparing form. Please print or
type.
Nothing
in this form shall be construed to imply that the Commission has verified any
information contained herein.
If the
notification relates to a portion of the filing checked above, identify the
item(s) to which the notification relates:
PART
I
REGISTRANT
INFORMATION
Franklin Credit Management
Corporation
Full Name
of Registrant
________________________________________________________________________________________________________________
Former
Name if Applicable
101 Hudson
Street
Address
of Principal Executive Office (Street and Number)
Jersey City, New
Jersey 07302
City,
State and Zip Code
PART
II
RULE
12b-25(b) AND (c)
If the
subject report could not be filed without unreasonable effort or expense and the
registrant seeks relief pursuant to Rule 12b-25(b), the following should be
completed. (Check box if appropriate.)
|
[X]
|
(a)
|
The
reasons described in reasonable detail in Part III of this form could not
be eliminated without unreasonable effort or
expense;
|
|
[X]
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(b)
|
The
subject annual report, semi-annual report, transition report on Form 10-K,
Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will
be filed on or before the fifteenth calendar day following the prescribed
due date; or the subject quarterly report or transition report on Form
10-Q or subject distribution report on Form 10D, or portion thereof, will
be filed on or before the fifth calendar day following the prescribed due
date; and
|
|
[ ]
|
(c)
|
The
accountant’s statement or other exhibit required by Rule 12b-25(c) has
been attached if applicable.
|
PART
III
NARRATIVE
State
below in reasonable detail why the Form 10-K, 20-F, 11-K, 10-Q, 10D, N-SAR,
N-CSR or the transition report or portion thereof, could not be filed within the
prescribed time period.
The
Registrant has not completed its financial statements for the second quarter of
2008 and the Registrant’s independent registered public accounting firm has not
yet completed its financial statement review. Accordingly, the
Registrant’s quarterly report on Form 10-Q for the period ended June
30, 2008 could not be filed within the prescribed time period without
unreasonable effort or expense.
PART
IV
OTHER
INFORMATION
(1)
|
Name
and telephone number of person to contact in regard to this
notification
|
Paul D.
Colasono 201 604-4402
(Name) (Area
Code) (Telephone
Number)
(2)
|
Have
all other periodic reports required under Section 13 or 15(d) of the
Securities Exchange Act of 1934 or Section 30 of the Investment Company
Act of 1940 during the preceding 12 months or for such shorter period that
the registrant was required to file such report(s) been
filed? If the answer is no, identify
report(s).
|
[X]
Yes [ ] No
(3)
|
Is
it anticipated that any significant change in results of operations from
the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion
thereof?
|
[X]
Yes [ ] No
If so:
attach an explanation of the anticipated change, both narratively and
quantitatively, and, if appropriate, state the reasons why a reasonable estimate
of the results cannot be made.
The
Registrant’s net loss is expected to increase to between approximately $280
million and $285 million for the second quarter of 2008, compared with a net
loss of $3.6 million for the second quarter of 2007, principally the result of a
significant provision for loan losses during the quarter. Due
principally to the continued, substantial deterioration in the housing and
subprime mortgage markets and the significant further deterioration in the
performance of the Registrant’s portfolios of acquired and originated loans,
including particularly the portfolio of acquired second-lien mortgage loans, the
Registrant’s assessment of its allowance for loan losses (“reserves”) in the
quarter ended June 30, 2008, resulted in significantly increased estimates of
inherent losses in its portfolios and the need for a substantial increase in
reserves. As a result, the provision for loan losses is expected
to increase to between approximately $280 million and $285
million in the quarter ended June 30, 2008, and the Registrant is expected
to have a stockholders’ deficit of between approximately $242 million and
$247 million at June 30, 2008.
The Registrant has not completed its
financial statements for the second quarter of 2008, principally due to the
finalization of the provision for loan losses, and the Registrant’s independent
registered public accounting firm has not yet completed its financial statement
review. Accordingly, there can be no assurance that the financial
information publicly announced at a later date will not differ from the above
disclosure. The Registrant expects to file its quarterly report on
Form 10-Q for the period ended June 30, 2008 on or before the fifth
calendar day following the prescribed due date.
The Registrant today entered into additional amendments to the Forbearance
Agreements with its lead lending bank whereby, among other things, the minimum
net worth covenant was eliminated, and all identified forbearance defaults that
existed as of June 30, 2008 were waived.
Franklin Credit Management
Corporation
(Name of
Registrant as Specified in Charter)
Has
caused this notification to be signed on its behalf by the undersigned thereunto
duly authorized.
Date:
August 15, 2008 By: /s/ Paul D.
Colasono
Name: Paul D.
Colasono
Title:
Chief Financial Officer and Executive Vice President