Filed by Ugly Duckling Corporation
Pursuant to Rule 425 under the Securities Act of 1933
Commission File No: 000-20841
Subject Company: Ugly Duckling Corporation
THE FOLLOWING PRESS RELEASE WAS DISSEMINATED BY UGLY DUCKLING CORPORATION ON
OCTOBER 5, 2000.
NEWS BULLETIN RE: UGLY DUCKLING CORPORATION
2525 EAST CAMELBACK ROAD
SUITE 500
FROM: PHOENIX, AZ 85016
NASDAQ: UGLY
FOR IMMEDIATE RELEASE
October 5, 2000
UGLY DUCKLING CONFIRMS Receipt of offer to purchase
company FROM CHAIRMAN/LARGEST SHAREHOLDER
PHOENIX - October 5, 2000 - Ugly Duckling Corporation (Nasdaq NM: UGLY),
confirmed that its Chairman and largest shareholder, Mr. Ernest C. Garcia II,
has made an offer to the Board of Directors to purchase all of the outstanding
shares of common stock of the company not already owned by Mr. Garcia. Mr.
Garcia currently owns approximately 36.5% of the company's outstanding shares of
common stock.
Under the terms of the offer, the holders of the outstanding shares of common
stock would receive $8.50 per share, $2.50 in cash and $6.00 in subordinated
indebtedness of the acquiring company. Greg Sullivan, Chief Executive Officer
and President of the company, has an arrangement with Mr. Garcia under which he
would purchase or receive an option to purchase a 20% interest in the acquiring
company.
The Board of Directors has established a special transaction committee of the
board, composed of disinterested directors, to evaluate and make a
recommendation to the full board on the proposal.
Headquartered in Phoenix, Arizona, Ugly Duckling Corporation is the largest
operator of used car dealerships focused exclusively on the sub-prime market.
The Company underwrites, finances and services sub-prime contracts generated at
its 77 Ugly Duckling dealerships, located in 11 metropolitan areas in eight
states.
This press release includes statements that constitute forward-looking
statements within the meaning of the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are often
characterized by the words "believes," "estimates," "projects," "expects" or
similar expressions. Factors that could cause or contribute to differences from
these forward-looking statements include factors detailed in the sections
entitled "Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Risk Factors," "Factors That May Affect Future Results
and Financial Condition" and "Factors That May Affect Future Stock Performance"
in Ugly Duckling Corporation's most recent reports on Form 10-K and Form 10-Q
(including Exhibit 99 to any such Form 10-Q), and elsewhere in Ugly Duckling
Corporation's Securities and Exchange Commission filings. By making these
forward-looking statements, the Company undertakes no obligation to update these
statements for revisions or changes after the date of this press release.
References to Ugly Duckling Corporation as the largest and fastest growing
operator of used car dealerships focused exclusively on the sub-prime market is
management's belief based upon its knowledge of the industry and not on any
current independent third party study.
There can be no assurance that the proposed transaction described in the press
release will be accepted by the company in its proposed form or any revised form
or, that even if accepted, the transaction will close.
In the event that the proposed transaction is accepted by the company, the
acquiring company and Ugly Duckling will likely be required to file a joint
proxy statement/ prospectus and to make certain other filings regarding the
proposed transaction with the Securities and Exchange Commission. Investors and
security holders are advised to read all such filings regarding the proposed
transaction, when and if the transaction proceeds and such filings are made,
because they will contain important information. Investors and security holders
may obtain free copies of any such filings (when and if they become available)
and other documents filed by Ugly Duckling Corporation with the Commission at
the Commission's web site at www.sec.gov. Information concerning any
participants in any solicitation of Ugly Duckling stockholders that is made in
connection with the proposed transaction will be disclosed when available.
For more information on Ugly Duckling, please dial
1-800-PRO-INFO and enter company ticker symbol UGLY.
