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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO
SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 5)
RENTAL SERVICE CORPORATION
(Name of Subject Company)
RENTAL SERVICE CORPORATION
(Name of Person(s) Filing Statement)
Common Stock, Par Value $.01 Per Share
(Title of Class of Securities)
76009V102
(CUSIP Number of Class of Securities)
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Robert M. Wilson
Executive Vice President, Chief Financial Officer, Secretary and Treasurer
Rental Service Corporation
6929 East Greenway Parkway, Suite 200
Scottsdale, Arizona 85254
(480) 905-3300
(Name, Address and Telephone Number of Person Authorized to Receive
Notice and Communications on Behalf of the Person(s) Filing Statement)
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Copies to:
Elizabeth A. Blendell, Esq. Mark D. Gerstein, Esq.
Latham & Watkins Latham & Watkins
633 West Fifth Street, Suite 4000 233 South Wacker Drive
Los Angeles, California 90071-2007 Sears Tower, Suite 5800
(213) 485-1234 Chicago, Illinois 60606-6401
(312) 876-7700
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Item 8. Additional Information.
On April 30, 1999, Rental Service Corporation ("RSC") sent a letter to its
stockholders with respect to the stockholder rights plan adopted by the Board of
Directors of RSC on April 15, 1999 and the related Rights Agreement, dated as of
April 16, 1999, between RSC and ChaseMellon Shareholder Services, L.L.C., as
Rights Agent. A copy of the letter is filed as Exhibit 44 attached hereto and is
incorporated by reference herein.
Item 9. Material to be Filed as Exhibits.
44 Letter to stockholders from Robert M. Wilson dated April 30, 1999.
1
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: April 30, 1999 Rental Service Corporation
/s/ Robert M. Wilson
By: _________________________________
Name: Robert M. Wilson
Title: Executive Vice President, Chief
Financial Officer, Secretary
and Treasurer
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Exhibit 44
[RENTAL SERVICE CORPORATION LOGO]
To Our Stockholders: April 30, 1999
On April 15, 1999, the Board of Directors of Rental Service Corporation
adopted a Share Purchase Rights Plan.
The Rights Plan assigns one Right to purchase a fraction of a share of a
newly created series of Rental Service Corporation Preferred Stock for each
share of Rental Service Corporation Common Stock owned on April 30, 1999.
Initially, the Rights will not be exercisable and will not trade separately
from the Common Stock. Under certain circumstances, stockholders will be able
to exercise their Rights if a person or group initiates an unsolicited
takeover of the Company by acquiring at least 10% of the Common Stock or by
making a tender offer to acquire 10% or more of the Rental Service Corporation
Common Stock. Ultimately, if an unsolicited acquirer gains control of the
Company, stockholders other than the acquirer would be able to purchase either
our Common Stock or the acquirer's stock at a 50% discount. The dividend,
liquidation and voting rights, and the non-redemption feature, of the
Preferred Stock are designed so that the value of the one one-thousandth
interest in a share of new Preferred Stock purchasable with each Right will
approximate the value of one share of Common Stock. The Rights Plan will
expire in 2009 or, as required by the Merger Agreement, on the earlier of (i)
the 60th day following the termination of the Agreement and Plan of Merger,
dated as of January 20, 1999, between Rental Service Corporation and
NationsRent, Inc. or (ii) the 60th day following the closing of any merger or
acquisition transaction Rental Service Corporation pursuant to certain types
of agreements. The Rental Service Corporation Board has determined to delay
the distribution of the Rights until the earlier of the date on which an
Acquiring Person becomes such and such date as may be determined by action of
the Board of Directors of the Company prior to the time any person or group
becomes an Acquiring Person.
These are some of the highlights of the Rights Plan. More information is in
the attached summary of the Rights Plan, and we urge you to read it carefully.
No action by stockholders is required or permitted at this time, and no
money should be sent to Rental Service Corporation. The Rights will
automatically attach to the shares of Common Stock you hold and will trade
with them. There is no need to send in your certificates to have this
reference added.
The Board adopted the Rights Plan after considering (i) the inadequacy of
the price offered to stockholders of the Company in the tender offer commenced
by a subsidiary of United Rentals, Inc., (ii) the risk that the United Rentals
tender offer will not be consummated and (iii) the Company's plan to complete
the merger with NationsRent, Inc. pursuant to the Agreement and Plan of
Merger. The Rights are designed to protect stockholders in the event of an
unsolicited attempt to acquire the Company. We consider these Rights to be a
valuable means of protecting your right to retain your equity investment in
the Company and the full value of that investment, while not foreclosing a
fair acquisition bid for the Company.
Our overriding objective is to continue building value for Rental Service
Corporation's stockholders, and we feel that the Rights Plan will assist in
that effort.
Sincerely,
/s/ Robert M. Wilson
Robert M. Wilson
Executive Vice President, Chief
Financial Officer, Secretary
and Treasurer
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As described in the Rights Agreement, Rights which are held by
or have been held by an Acquiring Person or Associates or Affiliates
thereof (as defined in the Rights Agreement) and certain transferees
thereof shall become null and void and will no longer be transferable.
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On April 15, 1999 the Board of Directors of Rental Service Corporation (the
"Company") declared a dividend of one preferred share purchase right (a
"Right") for each share of common stock, $.01 par value (the "Common Shares"),
of the Company outstanding at the Close of Business on April 30, 1999 (the
"Record Date"). As long as the Rights are attached to the Common Shares, the
Company will issue one Right (subject to adjustment) with each new Common
Share so that all such shares will have attached Rights. When exercisable,
each Right will entitle the registered holder to purchase from the Company one
one-thousandth of a share of Series A Junior Participating Preferred Stock
(the "Preferred Shares") at a price of $150.00 per one one-thousandth of a
Preferred Share, subject to adjustment (the "Purchase Price"). The description
and terms of the Rights are set forth in a Rights Agreement, dated as of April
16, 1999, as the same may be amended from time to time (the "Agreement"),
between the Company and ChaseMellon Shareholder Services, L.L.C., as Rights
Agent (the "Rights Agent").
Until the earlier to occur of (i) ten (10) days following a public
announcement that a person or group of affiliated or associated persons has
acquired, or obtained the right to acquire, beneficial ownership of 10% or
more of the Common Shares (an "Acquiring Person") or (ii) the occurrence of
the tenth business day (or such later date as may be determined by action of
the Board of Directors prior to such time as any person or group of affiliated
persons becomes an Acquiring Person) following the commencement or
announcement of an intention to make a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by a person or
group of 10% or more of the Common Shares (the earlier of (i) and (ii) being
called the "Distribution Date"), the Rights will be evidenced, with respect to
any of the Common Share certificates outstanding as of the Record Date, by
such Common Share certificate together with a copy of this Summary of Rights.
No Person shall become an Acquiring Person solely as the result of any one or
more of the following: (i) an acquisition of Common Shares by the Company
which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to 10% or
more of the Common Shares of the Company then outstanding; (ii) the holding or
acquisition by NationsRent (or any officer, director, Affiliate or Associate
of NationsRent) of Beneficial Ownership of Common Shares of the Company
pursuant to the grant by the Company to NationsRent of the Stock Option
Agreement or the issuance of Common Shares of the Company to NationsRent under
the Stock Option Agreement; (iii) the acquisition by any Person of Beneficial
Ownership of Common Shares of the Company issued or to be issued pursuant to the
Merger Agreement or (iv) the acquisition by any director or officer of
NationsRent or any Person who may be deemed an Affiliate or an Associate of
NationsRent of Beneficial Ownership of Common Shares of the Company issued or
the issuance of Common Shares of the Company pursuant to NationsRent Options
(as defined in the Agreement) under the terms of the Merger Agreement until,
in the case of each of clauses (i) through (iv), such time after the date
hereof as any of such Persons shall become the Beneficial Owner (other than
pursuant to a dividend or distribution paid or made by the Company on the
outstanding Common Shares of the Company or pursuant to a split or subdivision
of the outstanding Common Shares) of any additional Common Shares (other than
any such additional Common Shares acquired in a transaction which is the
subject of any of the exceptions described in the foregoing clauses (ii)
through (iv)) and shall thereby become the Beneficial Owner of 10% or more of
the Common Shares of the Company then outstanding (other than as a consequence
of clause (i)).
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The Agreement provides that until the Distribution Date (or earlier
redemption, exchange, termination, or expiration of the Rights), the Rights
will be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Share certificates issued after the Close of Business on the Record
Date upon transfer or new issuance of the Common Shares will contain a
notation incorporating the Agreement by reference. Until the Distribution Date
(or earlier redemption, exchange, termination or expiration of the Rights),
the surrender for transfer of any certificates for Common Shares, with or
without such notation or a copy of this Summary of Rights, will also
constitute the transfer of the Rights associated with the Common Shares
represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Shares as of
the Close of Business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights will
expire on April 16, 2009, subject to the Company's right to extend such date
(the "Final Expiration Date"), unless earlier redeemed or exchanged by the
Company or terminated. The Rights will be deemed to be terminated, among other
things, upon the 60th day following the date of the termination of the Merger
Agreement or upon the 60th day following closing of any merger or other
acquisition transaction involving the Company pursuant to certain types of
agreements, unless extended.
Each Preferred Share purchasable upon exercise of the Rights will be
entitled, when, as and if declared, to a minimum preferential quarterly
dividend payment of $1.00 per share but will be entitled to an aggregate
dividend of 1,000 times the dividend, if any, declared per Common Share. In
the event of liquidation, dissolution or winding up of the Company, the
holders of the Preferred Shares will be entitled to a minimum preferential
liquidation payment of $1,000 per share (plus any accrued but unpaid
dividends) but will be entitled to an aggregate payment of 1,000 times the
payment made per Common Share. Each Preferred Share will have 1,000 votes and
will vote together with the Common Shares. Finally, in the event of any
merger, consolidation or other transaction in which Common Shares are
exchanged, each Preferred Share will be entitled to receive 1,000 times the
amount received per Common Share. Preferred Shares will not be redeemable.
These rights are protected by customary antidilution provisions. Because of
the nature of a Preferred Share's dividend, liquidation and voting rights, the
value of one one-thousandth of a Preferred Share purchasable upon exercise of
each Right should approximate the value of one Common Share.
The Purchase Price payable, and the number of Preferred Shares or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares or
convertible securities at less than the current market price of the Preferred
Shares or (iii) upon the distribution to holders of the Preferred Shares of
evidences of indebtedness, cash, securities or assets (excluding regular
periodic cash dividends at a rate not in excess of 125% of the rate of the
last regular periodic cash dividend theretofore paid or, in case regular
periodic cash dividends have not theretofore been paid, at a rate not in
excess of 50% of the average net income per share of the Company for the four
quarters ended immediately prior to the payment of such dividend, or dividends
payable in Preferred Shares (which dividends will be subject to the adjustment
described in clause (i) above)) or of subscription rights or warrants (other
than those referred to above).
In the event that a Person becomes an Acquiring Person or if the Company
were the surviving corporation in a merger with an Acquiring Person or any
affiliate or associate of an Acquiring Person and the Common Shares were not
changed or exchanged, each holder of a Right, other than Rights that are or
were acquired or beneficially owned by the Acquiring Person (which Rights will
thereafter be void), will
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thereafter have the right to receive upon exercise that number of Common
Shares having a market value of two times the then current Purchase Price of
the Right. In the event that, after a person has become an Acquiring Person,
the Company were acquired in a merger or other business combination
transaction or more than 50% of its assets or earning power were sold, proper
provision shall be made so that each holder of a Right shall thereafter have
the right to receive, upon the exercise thereof at the then current Purchase
Price of the Right, that number of shares of common stock of the acquiring
company which at the time of such transaction would have a market value of two
times the then current Purchase Price of the Right.
At any time after a Person becomes an Acquiring Person and prior to the
earlier of one of the events described in the last sentence of the previous
paragraph or the acquisition by such Acquiring Person of 50% or more of the
outstanding Common Shares, the Board of Directors may cause the Company to
exchange the Rights (other than Rights owned by an Acquiring Person which will
have become void), in whole or in part, for Common Shares at an exchange rate
of that number of Common Shares having an aggregate value equal to the Spread
(as defined in the Agreement) (with such value being based on the current per
share market price (as determined pursuant to Section 11.4 of the Agreement)
on the date of the occurrence of a Trigger Event (as defined in the Agreement)
per Right (subject to adjustment).
No adjustment in the Purchase Price will be required until cumulative
adjustments require an adjustment of at least 1% in such Purchase Price. No
fractional Preferred Shares or Common Shares will be issued (other than
fractions of Preferred Shares which are integral multiples of one one-
thousandth of a Preferred Share, which may, at the election of the Company, be
evidenced by depository receipts), and in lieu thereof, a payment in cash will
be made based on the market price of the Preferred Shares or Common Shares on
the last trading date prior to the date of exercise.
The Rights may be redeemed in whole, but not in part, at a price of $.01 per
Right (the "Redemption Price") by the Board of Directors at any time prior to
the time that an Acquiring Person has become such. The redemption of the
Rights may be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
Immediately upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no rights
as a stockholder of the Company beyond those as an existing stockholder,
including, without limitation, the right to vote or to receive dividends.
Any of the provisions of the Agreement may be amended by the Board of
Directors of the Company for so long as the Rights are then redeemable, and
after the Rights are no longer redeemable, the Company may amend or supplement
the Agreement in any manner that does not adversely affect the interests of
the holders of the Rights.
A copy of the Agreement has been filed with the Securities and Exchange
Commission as an Exhibit to a Current Report on Form 8-K. A copy of the
Agreement is available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is qualified in
its entirety by reference to the Agreement, which is incorporated herein by
reference.
