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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 19, 1998
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Ryder TRS, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 333-20397 38-331-3542
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1560 Broadway, Suite 1800, Denver Colorado 80202
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 376-0040
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Former name or former address, if changed since last report: N/A
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This document consists of 27 pages.
The Exhibit Index is at page 5.
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Item 1. Change of Control of the Registrant.
On June 19, 1998, pursuant to an Agreement and Plan of Merger (the
"Merger Agreement"), dated as of March 4, 1998, as amended on March 16, 1998,
and on June 19, 1998, among Budget Group, Inc., a Delaware corporation
("Budget"), BDG Corporation, a Delaware corporation ("Sub"), Ryder TRS, Inc., a
Delaware corporation ("Ryder"), and certain other parties named therein, Sub
merged with and into Ryder (the "Merger"), and Ryder became a wholly owned
subsidiary of Budget. As a result of the Merger, each share of Ryder common
stock has been converted into the right to receive 26.60050195 shares of Budget
Class A Common Stock, par value $.01 per share (the "Budget Common Stock"),
$1,002.20 in cash and warrants to purchase initially 7.69864426874 shares of
Budget Common Stock, exercisable in accordance with the terms of the Merger
Agreement. In addition, each option to purchase Ryder common stock became fully
exercisable and vested immediately prior to the Merger and, concurrently with
the Merger, was canceled; thereafter, each optionholder became entitled to
receive, upon payment of applicable withholding tax, in exchange for each such
option, 26.60050195 shares of Budget Common Stock, and warrants to purchase
initially 7.69864426874 shares of Budget Common Stock, exercisable in
accordance with the terms of the Merger Agreement.
A copy of the press release announcing the Merger is attached hereto
as Exhibit 99.1.
Item 2. Acquisition or Disposition of Assets.
See description of merger of Registrant with Sub in Item 1.
-2-
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired: None
(b) Pro Forma Financial Information: None
(c) Exhibits.
2.1 - Agreement and Plan of Merger dated as of March 4,
1998, by and among Budget Group, Inc., BDG
Corporation, Ryder TRS, Inc., and certain other
parties (incorporated by reference to Exhibit 2.1 of
Current Report on Form 8-K, dated March 4, 1998).
2.2 - Amendment No. 1 to Agreement and Plan of Merger
dated as of March 16, 1998, by and among Budget
Group, Inc., BDG Corporation, Ryder TRS, Inc., and
certain other parties (incorporated by reference to
Exhibit 2.2 of Current Report on Form 8-K, dated
March 4, 1998).
2.3 - Amendment No. 2 to Agreement and Plan of Merger
dated as of June 19, 1998, by and among Budget
Group, Inc., BDG Corporation, Ryder TRS, Inc., and
certain other parties.
2.4 - Form of Warrant issued to former Ryder TRS
shareholders and optionholders
99.1 - Joint Press Release issued by Budget Group, Inc. and
Ryder TRS, Inc. on June 22, 1998.
-3-
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RYDER TRS, INC.
(Registrant)
Date: June 29, 1998 By: /s/ Scott White
-----------------------------------
Scott White
Vice President and Secretary
<PAGE> 5
EXHIBIT INDEX
2.1 - Agreement and Plan of Merger dated as of March 4,
1998, by and among Budget Group, Inc., BDG
Corporation, Ryder TRS, Inc., and certain other
parties (incorporated by reference to Exhibit 2.1 of
Current Report on Form 8-K, dated March 4, 1998).
2.2 - Amendment No. 1 to Agreement and Plan of Merger
dated as of March 16, 1998, by and among Budget
Group, Inc., BDG Corporation, Ryder TRS, Inc., and
certain other parties (incorporated by reference to
Exhibit 2.2 of Current Report on Form 8-K, dated
March 4, 1998).
2.3 - Amendment No. 2 to Agreement and Plan of Merger
dated as of June 19, 1998, by and among Budget
Group, Inc., BDG Corporation, Ryder TRS, Inc., and
certain other parties.
2.4 - Form of Warrant issued to former Ryder TRS
shareholders and optionholders
99.1 - Joint Press Release issued by Budget Group, Inc. and
Ryder TRS, Inc. on June 22, 1998.
<PAGE> 1
Exhibit 2.3
AMENDMENT NO. 2
TO AGREEMENT AND PLAN OF MERGER
AMENDMENT NO. 2 dated as of June 19, 1998 to the Agreement and Plan
of Merger, dated as of March 4, 1998, by and among Budget Group, Inc.
("Buyer"), BDG Corporation ("Sub"), Ryder TRS, Inc. (the "Company"), and
certain other parties, as amended on March 16, 1998 (as so amended, the "Merger
Agreement"). Capitalized terms not otherwise defined herein have the meanings
given to them in the Merger Agreement.
WHEREAS, the parties to the Merger Agreement agreed to merge Sub with
and into the Company in accordance with the terms and conditions of the Merger
Agreement and Section 251 of the General Corporation Law of the State of
Delaware;
WHEREAS, the parties desire to amend certain provisions of the Merger
Agreement as more fully set forth herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in consideration of the
agreements herein, the parties hereto agree as follows:
A. Section 1.1(b) of the Merger Agreement is hereby amended and
restated in its entirety to read as follows:
"(b) an aggregate number of shares of Buyer Class A Common
Stock issuable to all such holders equal to a minimum of 1,182,182
shares (the "Minimum Merger Shares") and a maximum of 3,455,219
shares (the "Maximum Merger Shares") (in each case less any shares of
Buyer Class A Common Stock issued to the holders of Options pursuant
to Section 3.7), with the precise number thereof determined as set
forth in Section 3.1 and subject to adjustment as provided in Article
III;"
B. Section 3.1(b) of the Merger Agreement is amended and
restated in its entirety to read as follows:
"(a) The total amount of cash to be paid in the Merger to
the holders of the Outstanding Company Shares under Section 3.2(a)
(the "Aggregate Cash Consideration") shall be (i) if the Maximum
Merger Shares are issued, $125,000,000, or (ii) if the Minimum Merger
Shares are issued, $200,000,000."
C. Section 3.3 of the Merger Agreement is hereby amended by
adding (i) at the beginning of each sentence in clause (a) the words "Subject
to the terms and conditions set forth
<PAGE> 2
in Section 3.3(c) below," (ii) in clause (b) on the fourth line thereof after
the word "resulting", the words," subject to the terms and conditions set forth
in Section 3.3(c) below," and (iii) by adding a new clause (c) after clause (b)
thereof to read as follows:
"(c) Notwithstanding anything to the contrary contained
herein, the parties hereto agree that (i) any item or claim set forth
on Schedule X attached hereto shall not, and shall not be deemed to,
constitute a breach as of any date of any representation, warranty or
covenant of the Company or, if applicable, of any Significant
Stockholder ("Excluded Alleged Breaches"), and (ii) no Excluded
Alleged Breach shall give rise to any adjustment under Section 3.3
and all Excluded Alleged Breaches shall be excluded from the
calculation of the Materiality Threshold. For the avoidance of doubt,
the parties hereto agree that the following items are Excluded
Alleged Breaches: (i) any impairment, write-off or decrease in value
of (1) the current and long-term deferred income taxes recorded on
the Company's consolidated financial statements and (2) capitalized
software costs of RyderFirst, Yield Management and Transfer
Optimization Model and computer hardware related to these three items
recorded on the Company's consolidated financial statements, (ii) any
cost associated with upgrading, enhancing, replacing, substituting or
modifying existing software or applications used in operating the
business of the Company and its Subsidiaries and (iii) any cost
associated with transferring existing software, software in
development, hardware and related support equipment, and information
system support services."
D. Section 3.5(a) of the Merger Agreement is hereby amended by
replacing (i) the words "$20 million" twice in the last sentence of the first
paragraph with the words "$19 million" in each case, and (ii) the second
sentence of the second paragraph with the following sentence: "Buyer shall have
the right to buy all the Warrants, in whole and not in part, by paying the
Total Warrant Value for each Original Holder and its Permitted Transferee to
the holder of such Warrant either in immediately available funds or, except as
provided below, in shares of Buyer Class A Common Stock valued at the Market
Value per share of Buyer Class A Common Stock as of the Warrant Measurement
Date (but not in a combination of both); provided, however, that Buyer shall
not have the option set forth above and Buyer shall pay the Total Warrant Value
in immediately available funds to each Warrant holder, if Buyer Class A Common
Stock is no longer listed on the NYSE or another national securities exchange
or automated quotation system."
E. Section 4.14 of the Merger Agreement is hereby amended by
inserting on the second line thereof after the words "Management Company" the
words "and Madison Dearborn Partners, L.P.".
F. A new Section 5.13 of the Merger Agreement is inserted after
Section 5.12 of the Merger Agreement to read as follows:
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"Section 5.13. Closing Date Representation. Buyer represents and
warrants that as of the Closing Date and other than any Excluded
Alleged Breach, neither Buyer nor any of its officers, directors,
employees, agents, Affiliates, financial advisers, investment
bankers, accountants, auditors or other advisers, has knowledge of
any event or circumstance constituting or causing a failure of any
representation or warranty of the Company or any Significant
Stockholder contained in this Agreement to be true and correct as of
any date or a failure of any covenant made or agreed to by the
Company or any Significant Stockholder contained in this Agreement to
be performed on or prior to the Closing Date."
G. Section 9.1 of the Merger Agreement is hereby amended by
adding the following sentence at the end of clause (a): "Notwithstanding
anything to the contrary contained herein, no representations and warranties of
the Company shall be deemed reaffirmed with respect to any Excluded Alleged
Breach".
H. Section 9.2 of the Merger Agreement is hereby amended by
adding on the third line thereof after the words "Significant Stockholders" the
following words, "except, in each case, with respect to any Excluded Alleged
Breach."
I. Section 9.3(a) of the Merger Agreement is hereby amended by
(i) inserting in the first sentence thereof after the words "Section 3.3" the
following words: ", it being understood that as provided in Section 3.3, there
is no breach or any adjustment with respect to any Excluded Alleged Breach,"
(ii) inserting in the second sentence thereof after the words "Escrow
Agreement)" the following words: "or with respect to any Excluded Alleged
Breach," and (iii) replacing the phrase "Indemnified Representative" with the
phrase "Indemnification Representative".
J. Pursuant to Section 3.5(a) of the Merger Agreement, the
parties hereto acknowledge that the form of Warrant attached hereto as Schedule
Y shall be deemed, together with the Warrant Assumptions (as such term is
defined in Section 3.5(a) of the Merger Agreement), to become a part of Exhibit
A to the Merger Agreement.
K. Exhibit B of the Merger Agreement is hereby amended by adding
the following sentence at the end of Section 2.1(a) of the Holdback Escrow
Agreement: "For the avoidance of doubt, the parties hereto agree that the
Excluded Alleged Breaches (as such term is defined in the Merger Agreement)
shall not give rise to any Damages."
L. Section 2.1(a) of Exhibit E to the Merger Agreement is
amended and restated in its entirety to read as follows:
"(a) As soon as practicable, but in any event no later than
15 days after the Effective Time, Buyer shall file a "shelf"
registration statement pursuant to Rule 415 under the Securities Act
(the "Registration Statement") with respect to the Registrable
Securities to be issued to the Holders pursuant to the Merger
Agreement. Buyer agrees that the Registration Statement will cover,
in the
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event the Minimum Merger Shares are issued in the Merger, 1,182,182
shares of Buyer Class A Common Stock or, in the event the Maximum
Merger Shares are issued in the Merger, 3,455,219 shares of Buyer
Class A Common Stock. In the event that the number of shares of Buyer
Class A Common Stock that are covered by the Registration Statement is
less than the number of Registrable Securities, Buyer shall, as
promptly as practicable after the issuance of Registrable Securities
not covered by the Registration Statement, file an additional "shelf"
registration statement and Buyer shall comply with all of its
obligations set forth in this Exhibit E with respect to such
additional registration statement to the same extent as if such
registration statement were the Registration Statement. Buyer shall
use its commercially reasonable efforts to (i) have the Registration
Statement declared effective on or before the Target Date, and (ii)
keep the Registration Statement continuously effective from the date
such Registration Statement is declared effective until the
Termination Date."
###
Each Significant Stockholder agrees to comply with its obligations as an
"Original Holder" under Section 3.8(b) of the Merger Agreement. Notwithstanding
anything to the contrary in this Amendment or in the Merger Agreement, this
paragraph shall survive the Closing without limitation as to time.
The Company represents and warrants to Buyer that this
Amendment has been duly executed and delivered by the Company, the form of this
Amendment has been approved by the Board of Directors of the Company and a
majority of the holders of Company Common Stock and no further corporate
authorization on the part of the Company is necessary to consummate the
transactions contemplated by this Amendment.
The Company and each Significant Stockholder represents and
warrants that this Amendment constitutes a valid and binding agreement of the
Company and each Significant Stockholder and is enforceable against the Company
and each Significant Stockholder in accordance with its terms, except to the
extent enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a proceeding
in equity or at law).
Buyer represents and warrants to the Company that this
Amendment has been duly executed and delivered by Buyer and Sub, this Amendment
has been approved by Buyer's and Sub's Board of Directors and by a majority of
holders of Sub's common stock, and no further corporate authorization on the
part of Buyer or Sub is necessary to consummate the transactions contemplated
by this Amendment.
This Amendment constitutes a valid and binding agreement of
Buyer and Sub and is enforceable against Buyer and Sub in accordance with its
terms, except to the extent
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enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a proceeding
in equity or at law).
The Merger Agreement is hereby reaffirmed in all respects and
shall remain in full force and effect in accordance with its terms except as
amended or modified by this Amendment.
This Amendment may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this
Amendment as of the date first written above.
BUDGET GROUP, INC.
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
BDG CORPORATION
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
RYDER TRS, INC.
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
<PAGE> 6
QUESTOR PARTNERS FUND, L.P.,
By: Questor General Partner, L.P.
its general partner
By: Questor Principals, Inc.,
its general partner
By:
-------------------------------
Jay Alix
Managing Principal
QUESTOR SIDE-BY-SIDE PARTNERS, L.P.,
By: Questor Principals, Inc.,
its general partner
By:
------------------------------------
Jay Alix
Managing Principal
MADISON DEARBORN CAPITAL
PARTNERS, L.P.
By: Madison Dearborn Partners, L.P.
its general partner
By: Madison Dearborn Partners, Inc.,
its general partner
By:
-------------------------------
Thomas R. Reusche
Vice President
<PAGE> 1
FORM OF WARRANT
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS. NO SALE, TRANSFER, PLEDGE OR OTHER
DISPOSITION OF THIS WARRANT SHALL BE MADE EXCEPT PURSUANT
TO REGISTRATION UNDER THE SECURITIES ACT, AND APPLICABLE
STATE SECURITIES LAWS, OR PURSUANT TO AN EXEMPTION THEREFROM
UNDER SUCH ACT AND SUCH STATE LAWS AND THE RESPECTIVE RULES
AND REGULATIONS THEREUNDER.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO THE TERMS AND CONDITIONS SPECIFIED IN THE MERGER AGREEMENT
(AS DEFINED BELOW), INCLUDING (BUT NOT LIMITED TO) EXHIBIT E
THERETO WHICH SETS FORTH THE RIGHTS OF THE HOLDER HEREOF WITH
RESPECT TO THE REGISTRATION OF BUYER CLASS A COMMON STOCK
ISSUABLE UPON EXERCISE OF THIS WARRANT. A COPY OF THE MERGER
AGREEMENT SHALL BE FURNISHED BY BUYER TO THE HOLDER HEREOF UPON
WRITTEN REQUEST.
-----------------------------------------------
WARRANT TO PURCHASE CLASS A COMMON STOCK OF
BUDGET GROUP, INC.
-----------------------------------------------
Exercisable as of the
Commencement Date
(as defined below)
Void After
the Expiration Date
(as defined below)
<PAGE> 2
THIS CERTIFIES that, for value received, [____________], or assigns,
is entitled, subject to the terms and conditions set forth in this Warrant and
the Merger Agreement (as defined below), to purchase from BUDGET GROUP, INC., a
Delaware corporation (the "Buyer"), in whole or in part, [______________]
shares (as adjusted on the Warrant Measurement Date, in accordance with the
terms set forth in the Merger Agreement and on Exhibit A to the Merger
Agreement (the "Warrant Assumptions"), and thereafter, in accordance with
Section 4 hereof) of fully paid and nonassessable Class A Common Stock, par
value $.01 per share, of Buyer (the "Buyer Class A Common Stock"), at any time
and from time to time during the period beginning on March 23, 2000 (the
"Commencement Date") and ending on March 23, 2005 (the "Expiration Date"), at a
price per share (the "Exercise Price") determined on the Final Measurement Date
(as defined in the Merger Agreement) in accordance with and subject to the
procedures set forth in Section 3.5 of the Merger Agreement and the Warrant
Assumptions (as thereafter adjusted in accordance with Section 4 hereof). The
Exercise Price and the number and character of such shares are subject to
adjustment as provided below and in the Warrant Assumptions, and the term
"Buyer Class A Common Stock" shall mean, unless the context otherwise requires,
the stock or other securities or property at the time deliverable upon the
exercise of this Warrant. This Warrant is herein called the "Warrant." This
Warrant is being issued in connection with an Agreement and Plan of Merger
dated as of March 4, 1998, by and among Buyer, BDG Corporation, Ryder TRS, Inc.
and certain other parties thereto (as amended from time to time, the "Merger
Agreement").
1. EXERCISE OF WARRANT.
a. Subject to the terms and conditions of this Warrant, on and
following the Commencement Date and on or prior to the
Expiration Date, this Warrant may be exercised by the holder
hereof, in whole or in part (but not as to a fractional
share), by the presentation and surrender of this Warrant
with an election to purchase in the form attached hereto,
properly completed and executed by the holder by certified
mail, by overnight courier, in person or by a legal
representative or attorney duly authorized to do so in
writing, at the principal office of Buyer (or at such other
address as Buyer may designate by notice in writing to the
holder hereof at the address of such holder appearing on the
books of Buyer), upon payment to Buyer of an amount (the
"Exercise Payment") equal to the Exercise Price multiplied by
the number of shares being purchased pursuant to such
exercise, payable as follows: (a) by payment to Buyer in
cash, by certified check or by wire transfer, (b) by
surrender to Buyer for cancellation of securities of Buyer
having a Market Price (as hereinafter defined) on the date of
exercise equal to the Exercise Payment, or (c) by a
combination of the methods described in clauses (a) and (b)
above. For purposes hereof, the term "Market Price" with
respect to any securities shall mean the volume-weighted
average closing prices on the NYSE (or, if such security is
not listed on the NYSE, such other principal exchange or
over-the-counter market on which such security is listed) for
the 30 consecutive days on which trading of such security
occurs ending at the close of trading on such date (or the
last trading day prior to such date).
<PAGE> 3
b. The shares of Buyer Class A Common Stock so purchased
pursuant to paragraph 1(A) above shall be deemed to be issued
to the holder hereof as the record owner of such shares as of
the close of business on the date on which this Warrant shall
have been surrendered and payment made for such shares.
Certificates for the shares of Buyer Class A Common Stock so
purchased shall be delivered or mailed to the holder promptly
after this Warrant shall have been so exercised, and, unless
this Warrant has expired or has been exercised in full, a new
Warrant identical in form but representing the number of
shares of Buyer Class A Common Stock with respect to which
this Warrant shall not then have been exercised shall also be
issued to the holder hereof at the expense of Buyer. At the
time this Warrant is exercised, Buyer may require the holder
to make such representations, and may place such legends on
certificates representing the shares being issued upon
exercise, as may be reasonably required in the written
opinion of counsel to the Buyer under federal and applicable
state securities laws.
c. Buyer shall pay all documentary, stamp or other transactional
taxes attributable to the issuance or delivery of shares of
Buyer Class A Common Stock upon exercise of the Warrants;
provided, however, that Buyer shall not be required to pay
any taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificate for
such shares in a name other than that of the holder of the
Warrant in respect of which such shares are being issued. If
any transfer described in the proviso to the preceding
sentence is involved, Buyer shall not be required to issue or
deliver any shares of Buyer Class A Common Stock until such
tax shall have been paid.
2. DOES NOT CONFER STOCKHOLDER LIABILITY. Except as otherwise
stated in the Merger Agreement or in this Warrant, this Warrant does not confer
any rights or privileges or impose any liabilities of a stockholder of Buyer
upon the holder hereof.
3. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as
practicable after the exercise of this Warrant and payment of the Exercise
Price, and in any event within five (5) Business Days thereafter, Buyer, at its
expense, will cause to be issued in the name of and delivered to the holder
hereof a certificate or certificates for the number of fully paid and
non-assessable shares or other securities or property to which such holder shall
be entitled upon such exercise, plus, in lieu of any fractional share to which
such holder would otherwise be entitled, cash in an amount determined in
accordance with paragraph 4.4 hereof. Buyer agrees that the shares so purchased
shall be deemed to be issued to the holder hereof as the record owner of such
shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for such shares as aforesaid.
4. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS.
a. Adjustments of Exercise Price and Number of shares. The
Exercise Price, number of shares of Buyer Class A Common
Stock purchasable upon the exercise of each Warrant and the
number of Warrants outstanding are subject to adjustment from
<PAGE> 4
time to time upon the occurrence of the following events on
or after February 22, 2000:
b. If Buyer shall (i) pay a dividend on its shares of capital
stock (including Buyer Class A Common Stock) in shares of
Buyer Class A Common Stock, (ii) subdivide its outstanding
shares of Buyer Class A Common Stock, (iii) combine its
outstanding shares of Buyer Class A Common Stock into a
smaller number of shares of Buyer Class A Common Stock or
(iv) increase or decrease the number of shares of Buyer Class
A Common Stock outstanding by reclassification (including any
such reclassification in connection with a consolidation or
merger in which Buyer is the continuing corporation), then
the number of shares of Buyer Class A Common Stock
purchasable upon exercise of this Warrant immediately prior
thereto shall be adjusted so that the holder of this Warrant
shall be entitled upon exercise to receive the kind and
number of shares of Buyer Class A Common Stock which such
holder would have owned or have been entitled to receive
after the happening of any of the events described above, had
this Warrant been exercised immediately prior to the
happening of such event or any record date with respect
thereto. An adjustment made pursuant to this paragraph (a)
shall become effective immediately after the effective date
of such event retroactive to the record date, if any, for
such event.
c. If Buyer shall issue rights, options or warrants to all
holders of its outstanding Buyer Class A Common Stock (other
than pursuant to a rights agreement), without payment of
additional consideration by such holders, entitling them (for
a period expiring within 45 days after the record date
mentioned below) to subscribe for or purchase shares of Buyer
Class A Common Stock at a price per share that is lower than
the Market Price per share of Buyer Class A Common Stock on
the date of issuance, the number of shares of Buyer Class A
Common Stock thereafter purchasable upon the exercise of this
Warrant shall be determined by multiplying the number of
Shares theretofore purchasable upon exercise of this Warrant
by a fraction, of which the numerator shall be (i) the number
of shares of Buyer Class A Common Stock outstanding on the
date of issuance of such rights, options or warrants plus the
number of additional shares of Buyer Class A Common Stock
offered for subscription or purchase, and of which the
denominator shall be (ii) the number of shares of Buyer Class
A Common Stock outstanding on the date of issuance of such
rights, options or warrants plus the number of shares which
the aggregate offering price of the total number of shares of
Buyer Class A Common Stock so offered would purchase at the
Market Price per share of Buyer Class A Common Stock on the
date of issuance. Such adjustment shall be made whenever such
rights, options or warrants are issued, and shall become
effective immediately on the date of issuance retroactive to
the record date for the determination of stockholders
entitled to receive such rights, options or warrants.
<PAGE> 5
d. If Buyer shall distribute to all holders of its shares of
Buyer Class A Common Stock evidences of its indebtedness or
assets (excluding cash dividends or distributions payable out
of consolidated earnings or earned surplus and dividends or
distributions referred to in paragraph (a) above) or rights,
options or warrants or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of
Buyer Class A Common Stock (excluding those referred to in
paragraph (b) above), then in each case the number of shares
of Buyer Class A Common Stock thereafter purchasable upon the
exercise of this Warrant shall be determined by multiplying
the number of shares theretofore purchasable upon the
exercise of each Warrant, by a fraction, of which the
numerator shall be (i) the Market Price per share of Buyer
Class A Common Stock on the date of such distribution, and of
which the denominator shall be (ii) the Market Price per
share of Buyer Class A Common Stock on the date of such
distribution, less the then fair value (as determined in good
faith by the Board of Directors of Buyer) of the portion of
the assets or evidences of indebtedness so distributed or of
such subscription rights, options or warrants or convertible
or exchangeable securities applicable to one share of Buyer
Class A Common Stock. Such adjustment shall be made whenever
any such distribution is made, and shall become effective on
the date of distribution retroactive to the record date for
the determination of stockholders entitled to receive such
distribution.
e. In the event of any capital reorganization or any
reclassification of Buyer Class A Common Stock (except as
provided in paragraphs (a) through (c) above or paragraph (j)
below) and subject to clause (k) below, the holder of this
Warrant upon exercise hereof shall be entitled to receive, in
lieu of Buyer Class A Common Stock to which such holder would
have become entitled upon exercise immediately prior to such
reorganization or reclassification, the shares (of any class
or classes) or other securities or property of Buyer that
such holder would have been entitled to receive at the same
aggregate Exercise Price upon such reorganization or
reclassification if such holder's Warrant had been exercised
immediately prior thereto; and in any such case, appropriate
provision (as determined in good faith by the Board of
Directors of Buyer) shall be made for the application of this
Section 4 with respect to the rights and interests thereafter
of the holder of this Warrant (including the allocation of
the adjusted Exercise Price between or among shares of
classes of capital stock), to the end that this Section 4
(including the adjustments of the number of shares of Buyer
Class A Common Stock or other securities purchasable) shall
thereafter be reflected, as nearly as reasonably practicable,
in all subsequent exercises of this Warrant for any shares or
securities or other property thereafter deliverable upon the
exercise of this Warrant.
f. For the purposes of adjustments required by paragraphs (b)
and (c) of this Section 4, the shares of Buyer Class A Common
Stock the holder of any rights, options, warrants or
convertible or exchangeable securities shall be entitled to
subscribe for or purchase shall be deemed to be issued and
outstanding as of the date of sale,
<PAGE> 6
issuance or distribution of such securities and the
consideration, if any, received by Buyer therefor shall be
deemed to be the consideration received by Buyer for such
securities, plus the consideration or premiums stated in such
security to be paid for the shares of Buyer Class A Common
Stock covered thereby.
g. Except for adjustments required by paragraph (j) hereof, no
adjustment in the number of shares of Buyer Class A Common
Stock purchasable hereunder shall be required unless such
adjustment would require an increase or decrease of at least
one percent (1%) in the number of shares purchasable upon the
exercise of this Warrant; provided, however, that any
adjustments which by reason of this paragraph (f) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations shall
be made to the nearest cent and to the nearest one-hundredth
of a share, as the case may be.
h. Whenever the number of shares purchasable upon the exercise
of this Warrant is adjusted as herein provided, the Exercise
Price payable upon exercise of this Warrant shall be adjusted
by multiplying such Exercise Price immediately prior to such
adjustment by a fraction, of which the numerator shall be the
number of shares of Buyer Class A Common Stock purchasable
upon the exercise of this Warrant immediately prior to such
adjustment, and of which the denominator shall be the number
of shares of Buyer Class A Common Stock so purchasable
immediately thereafter.
i. Upon the expiration of any rights, options, warrants or
conversion or exchange privileges, if any thereof shall not
have been exercised, the Exercise Price and the number of
shares of Buyer Class A Common Stock purchasable upon the
exercise of this Warrant shall, upon such expiration, be
readjusted and shall thereafter be such as it would have been
had it been originally adjusted (or had the original
adjustment not been required, as the case may be) as if (i)
the only shares of Buyer Class A Common Stock so issued were
the shares of Buyer Class A Common Stock, if any, actually
issued or sold upon the exercise of such rights, options,
warrants or conversion or exchange rights and (ii) such
shares of Buyer Class A Common Stock, if any, were issued or
sold for the consideration actually received by Buyer upon
such exercise plus the aggregate consideration, if any,
actually received by Buyer for the issuance, sale or grant of
all of such rights, options, warrants or conversion or
exchange rights whether or not exercised.
j. Except as provided in paragraphs (a), (b) and (c) of this
Section 4, no adjustment in respect of any dividends shall be
made during the term of this Warrant or upon the exercise of
this Warrant.
k. Subject to paragraph (k) below, in case of any Business
Combination (as defined in the Merger Agreement) involving
Buyer in which all of the criteria contained in clause (a)(1)
of Section 3.16 of the Merger Agreement are met, Buyer or
such successor or purchasing corporation, as the case may be,
shall execute an
<PAGE> 7
agreement that each holder of a Warrant shall have the right
thereafter upon payment of the Exercise Price in effect
immediately prior to such action to purchase upon exercise of
each Warrant the kind and amount of shares and other
securities and property which such holder would have owned or
have been entitled to receive after the happening of such
consolidation, merger, sale or conveyance had such Warrant
been exercised immediately prior to such action. Buyer shall
mail by first-class mail, postage prepaid, to each registered
holder of a Warrant, notice of the execution of any such
agreement. Such agreement shall provide for adjustments,
which shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Section 4. The
provisions of this paragraph (j) shall similarly apply to
successive consolidations, mergers, sales or conveyances.
l. In case Buyer shall at any time engage in any Business
Combination (as defined in the Merger Agreement), the holder
of this Warrant shall have the rights and Buyer shall have
the obligations set forth in Section 3.16 of the Merger
Agreement.
m. Notices of Record Date, Etc. In the event that:
n. Buyer shall declare any dividend upon its Buyer Class A
Common Stock payable in stock or make any extraordinary or
other special dividend or other extraordinary or other
special distribution to the holders of its Buyer Class A
Common Stock, or
o. Buyer shall offer for subscription pro rata to the holders of
its Buyer Class A Common Stock any additional shares of stock
of any class or other rights other than pursuant to a rights
agreement, or
p. There shall be any capital reorganization or reclassification
of the capital stock of Buyer, including any subdivision or
combination of its outstanding shares of Buyer Class A Common
Stock, or consolidation or merger of Buyer with, or sale of
all or substantially all of its assets to, another
corporation, or
q. There shall be a voluntary or involuntary dissolution,
liquidation or winding up of Buyer;
5. Then, in connection with such event, Buyer shall give to the
holder of this Warrant:
a. At least ten (10) days' prior written notice of the date on
which the books of Buyer shall close or a record shall be
taken for such dividend, distribution or subscription rights
or for determining rights to vote in respect of any such
reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up; and
<PAGE> 8
b. In the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or
winding up, at least ten (10) days' prior written notice of
the date when the same shall take place. Such notice in
accordance with the foregoing clause (i) shall also specify,
in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Buyer
Class A Common Stock shall be entitled thereto, and such
notice in accordance with the foregoing clause (ii) shall
also specify the date on which the holders of Buyer Class A
Common Stock shall be entitled to exchange their Buyer Class
A Common Stock for securities or other property deliverable
upon such reorganization, reclassification consolidation,
merger, sale, dissolution, liquidation or winding up, as the
case may be. Each such written notice shall be given by first
class mail, postage prepaid, addressed to the holder of this
Warrant at the address of such holder as shown on the books
of Buyer.
6. Adjustment by Board of Directors. If any event occurs as to
which, in the good faith opinion of the Board of Directors of Buyer, the
provisions of this Section 4 are not strictly applicable but the failure to
make such adjustment would not fairly protect the rights of the holder of this
Warrant in accordance with the essential intent and principles of such
provisions, then the Board of Directors shall make such adjustments, if any, as
in the good faith opinion of the Board of Directors of Buyer are necessary to
be consistent with such essential intent and principles, so as to protect such
rights as aforesaid, but in no event shall such adjustment have the effect of
increasing the Exercise Price as otherwise determined pursuant to any of the
provisions of this Section 4 except in the case of a combination of shares of a
type contemplated in Paragraph 4.1 and then in no event to an amount larger
than the Exercise Price as adjusted pursuant to Paragraph 4.1.
7. Fractional Shares. Buyer shall not issue fractions of shares
of Buyer Class A Common Stock upon exercise of this Warrant or scrip in lieu
thereof. If any fraction of a share of Buyer Class A Common Stock would be
issuable upon exercise of this Warrant, except for the provisions of this
Paragraph 4.4, Buyer shall in lieu thereof pay to the person entitled thereto
an amount in cash equal to the current value of such fraction, calculated to
the nearest one-hundredth (1/100) of a share, to be computed (i) if Buyer Class
A Common Stock is listed on any national securities exchange on the basis of
the last sales price of Buyer Class A Common Stock on such exchange (or the
quoted closing bid price if there shall have been no sales) on the date of
exercise, or (ii) if Buyer Class A Common Stock shall not be listed on any
national securities exchange, on the basis of the mean between the closing bid
and asked prices for Buyer Class A Common Stock on the date of exercise as
reported by NASDAQ or in another over-the-counter market and if there are not
such closing bid and asked prices, on the basis of the fair market value per
share as reasonably determined by the Board of Directors of Buyer. If more than
one Warrant shall be presented for exercise on the same day by the same holder,
the number of shares issuable upon the exercise thereof shall be computed on
the basis of the aggregate number of shares issuable upon the exercise of the
Warrants so presented.
8. Officers' Statement as to Adjustments. Whenever the Exercise
Price shall be adjusted as provided in Section 4 hereof, Buyer shall forthwith
file at each office designated for
<PAGE> 9
the exercise of this Warrant, a statement, signed by the Chairman of the Board,
the President, any Vice President or Treasurer of Buyer, showing in reasonable
detail the facts requiring such adjustment and the Exercise Price that will be
effective after such adjustment. Buyer shall also cause a notice setting forth
any such adjustments to be sent by mail, first class, postage prepaid, to the
record holder of this Warrant at his or its address appearing on the stock
register. If such notice relates to an adjustment resulting from an event
referred to in Paragraph 4.2, such notice shall be included as part of the
notice required to be mailed and published under the provisions of Paragraph
4.2 hereof.
9. NO DILUTION OR IMPAIRMENT. Buyer will not, by amendment of
its charter or through reorganization, consolidation, merger, dissolution, sale
of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of
all such action as may be necessary or appropriate in order to protect the
rights of the holder hereof against dilution or other impairment. Without
limiting the generality of the foregoing, Buyer will not increase the par value
of any shares of stock receivable upon the exercise of this Warrant above the
amount payable therefor upon such exercise, and at all times will take all such
action as may be necessary or appropriate in order that Buyer may validly and
legally issue fully paid and non-assessable stock upon the exercise of this
Warrant.
10. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS;
LISTING; REGISTRATION RIGHTS. Buyer shall at all times reserve and keep
available out of its authorized but unissued stock, solely for the issuance and
delivery upon the exercise of this Warrant and other Warrants issued pursuant
to the Merger Agreement, such number of its duly authorized shares of Buyer
Class A Common Stock as from time to time shall be issuable upon the exercise
of this Warrant and other Warrants issued pursuant to the Merger Agreement at
the time outstanding. Buyer shall use its commercially reasonable efforts to
list all shares of Buyer Class A Common Stock issued upon exercise of the
Warrants, in accordance with Section 6.21 of the Merger Agreement. Buyer shall
take such actions as are necessary to provide the registration rights set forth
in Exhibit E to the Merger Agreement, in accordance with Section 3.15 of the
Merger Agreement, until the Termination Date (as defined in Exhibit E to the
Merger Agreement).
11. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to Buyer of the loss, theft, destruction or mutilation of this
Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement in an amount reasonably satisfactory to it, or (in the case
of mutilation) upon surrender and cancellation thereof, Buyer will issue, in
lieu thereof, a new Warrant of like tenor.
12. REMEDIES. Buyer stipulates that the remedies at law of the
holder of this Warrant in the event of any default by Buyer in the performance
of or compliance with any of the terms of this Warrant are not and will not be
adequate, and that the same may be specifically enforced.
<PAGE> 10
13. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which each taker, owner or holder hereof consents and agrees:
a. This Warrant may not be transferred to any person by any
Original Holder at any time prior to the Commencement Date,
except that notwithstanding the foregoing any Original Holder
may transfer this Warrant to a Permitted Transferee (as
defined in the Merger Agreement) at any time. On and as of
the Commencement Date, this Warrant is transferable in
accordance with the terms set forth in clauses (b)-(h) below.
b. In accordance with and subject to the terms of Section 3.5 of
the Merger Agreement, Buyer shall have the right to buy this
Warrant, in whole and not in part, by paying the Total
Warrant Value (as defined in the Merger Agreement) on the
Commencement Date to the holder hereof either in immediately
available funds or, except as provided below, in shares of
Buyer Class A Common Stock valued at the Market Value (as
defined in the Merger Agreement) per share of Buyer Class A
Common Stock as of the Commencement Date (but not in a
combination of both).
c. In accordance with and subject to the terms and conditions of
Section 3.5(a) of the Merger Agreement, on February 29, 2000,
and subject to the receipt by Buyer from the holder of this
Warrant of a certificate certifying as to whether such holder
or any of its Permitted Transferees has disposed of any
Original Shares (as defined in the Merger Agreement) and
containing all other information regarding such holder
reasonably necessary to make the computations referred to in
Section 3.5(a) of the Merger Agreement (the delivery of which
certificate shall be a condition of such person's ability to
receive amounts under this Warrant), Buyer shall compute the
Total Warrant Value (as defined in the Merger Agreement) for
the holder of this Warrant and its Permitted Transferees, it
being understood, for the avoidance of doubt, that in
accordance with and subject to the terms and conditions of
Section 3.5(a) of the Merger Agreement, the computation of
the Total Warrant Value shall take into consideration
Original Shares held by the holder of this Warrant and its
Permitted Transferees on February 22, 2000.
d. Subject to clause (a) above and to the legend appearing on
the first page hereof, title to this Warrant may be
transferred by the holder by endorsement (by the holder
hereof executing the form of assignment at the end hereof
including guaranty of signature) and delivery in the same
manner as in the case of a negotiable instrument transferable
by endorsement and delivery; provided, however, that this
Warrant may not be sold, assigned or otherwise transferred to
a Person unless simultaneously with such transfer, the
related number of Original Shares are transferred to the same
Permitted Transferee.
e. Any person in possession of this Warrant properly endorsed is
authorized to represent himself as absolute owner hereof and
is granted power to transfer
<PAGE> 11
absolute title hereto by endorsement and delivery hereof to a
transferee of such holder; each prior taker or owner waives
and renounces all of his equities or rights in this Warrant
in favor of any such transferee, and each such transferee
shall acquire title hereto and to all rights represented
hereby.
f. Until this Warrant is transferred on the books of Buyer,
Buyer may treat the registered holder of this Warrant as the
absolute owner hereof for all purposes without being affected
by any notice to the contrary.
h. Prior to the exercise of this Warrant, the holder hereof
shall not be entitled to any rights of a shareholder of Buyer
with respect to shares for which this Warrant shall be
exercisable, including, without limitation, the right to
vote, to receive dividends or other distributions or to
exercise any preemptive rights, and shall not be entitled to
receive any notice of any proceedings of Buyer, except as
provided herein.
h. Buyer shall not be required to pay any Federal or state
transfer tax or charge that may be payable in respect of any
transfer involved in the transfer or delivery of this Warrant
or the issuance or conversion or delivery of certificates for
Buyer Class A Common Stock in a name other than that of the
registered holder of this Warrant or to issue or deliver any
certificates for Buyer Class A Common Stock upon the exercise
of this Warrant until any and all such taxes and charges
shall have been paid by the holder of this Warrant or until
it has been established to Buyer's reasonable satisfaction
that no such tax or charge is due.
14. SUBDIVISION OF RIGHTS. This Warrant (as well as any new
warrants issued pursuant to the provisions of this paragraph) is exchangeable,
upon the surrender hereof by the holder hereof, at the principal office of
Buyer for any number of new warrants of like tenor and date representing in the
aggregate the right to subscribe for and purchase the number of shares of Buyer
Class A Common Stock of Buyer which may be subscribed for and purchased
hereunder.
15. MAILING OF NOTICES, ETC. All notices and other communications
from Buyer to the holder of this Warrant shall be mailed by first-class
certified mail, postage prepaid, to the address furnished to Buyer in writing
by the last holder of this Warrant who shall have furnished an address to Buyer
in writing.
16. HEADINGS, ETC. The headings in this Warrant are for purposes
of reference only, and shall not limit or otherwise affect the meaning hereof.
17. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof
may be changed, waived, discharged or terminated orally but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
18. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.
<PAGE> 12
BUDGET GROUP, INC.
Dated: , 199 By:
-------------- --- -------------------------------------
Attest:
---------------------------------
-23-
<PAGE> 13
[To be signed only upon exercise of Warrant]
To Buyer:
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, ____ shares of Buyer's Class A Common Stock of Buyer and
herewith makes payment of $___ therefor, and requests that the certificates for
such shares be issued in the name of, and be delivered to ______, whose address
is _____________________.
Dated:
(Signature must conform in all respects to name of Holder as specified on the
face of the Warrant)
Address
<PAGE> 14
[To be signed only upon transfer of Warrant]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto ____________________ the right represented by the within Warrant
to purchase the_____ shares of Buyer Class A Common Stock of Buyer to which the
within Warrant relates, and appoints ________ attorney to transfer said right
on the books of Buyer with full power of substitution in the premises.
Dated:
(Signature must conform in all respects to name of Holder as specified on the
face of the Warrant)
Address
In the presence of
<PAGE> 1
Exhibit 99.1
07:46 Budget Group Closes on Ryder TRS Acquisition
DAYTONA BEACH, Fla., June 22/PRNewswire/ -- Budget Group, Inc.
(NYSE:BD) announced today it closed on the acquisition of Denver-based Ryder
TRS, Inc. on June 19, 1998. Ryder TRS is the nation's second largest consumer
truck rental company with annual revenue of $545 million in 1997. Prior to the
acquisition, Ryder TRS was a Questor Partner Fund portfolio company.
Ryder TRS shareholders received $125 million in cash, approximately
3.5 million shares of Budget Group Class A common stock and $19 million of
contingent additional consideration in return for 100 percent of the
outstanding Ryder TRS stock. In addition, Budget Group assumed Ryder TRS net
fleet debt of $347 million as well as public nots of $175 million.
Randall S. Smalley, President and CEO of Budget Group's Cruise America
subsidiary, will oversee the new Ryder TRS subsidiary as its president. Ron
Rittenmeyer, current President of Ryder TRS, will stay on with the company
through the end of June.
"With the addition of Ryder TRS we continue our strategy to create a
network of vehicle rental and sales companies which allows us to leverage our
asset base and management expertise. We'll enjoy significant cost savings and
efficiencies with Ryder TRS as one of the Budget Group companies, particularly
in the areas of fleet purchasing, maintenance and yield management," said Sandy
Miller, Chairman and CEO of Budget Group.
Ryder has a dealer-network of approximately 4,000 rental outlets and
20 company owned stores where it operates approximately 30,000 trucks and vans
for local and one-way rentals. The company has over 700 employees.
Budget Group, Inc., through subsidiary companies and their franchises,
operated Budget Car and Truck Rental, the third largest worldwide car and truck
rental system. In addition, the company owns Premier Car Rental, which serves
the insurance replacement market. Budget Group also owns Budget Car Sales, one
of the largest independent retailers of late model vehicles in the United
States, and Cruise America, the largest recreational vehicle rental and sales
company in North America. The company also operates airport parking facilities
at certain locations and, through Van Pool Services, leases vans for van
pooling operations.
/CONTACT: Scott White, Executive Vice President, Corporation Development of
Budget Group, Inc., 630-955-7600/ 07:29 EDT
<PAGE> 2
07:54 Budget Group - Ryder TRS -2: Assumes $347M Debt, $175M Notes
DAYTONA BEACH, Fla. (Dow Jones)--Budget Group, Inc. (BD) closed its
acquisition of Ryder TRS Inc. for $125 million in cash, about 3.5 million Class
A shares and $19 million of additional contingent consideration.
Budget Group also assumed $347 million in debt and $175 million in
notes.
In a press release Monday, Budget Group said Ryder TRS, a truck rental
company, had 1997 revenue of $545 million.
The company also named Randall S. Smalley, President of the new
company. Smalley is President and Chief Executive Officer of Budget's Cruise
America unit.
Budget Group said Ryder's current President, Ron Rittenmeyer, will
stay on with the company through the end of June.
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Certain items in this press release may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995 and as such may involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements
of Budget or Ryder to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such forward-looking statements speak only as of the date of this
press release. Budget and Ryder expressly disclaim any obligation or
undertaking to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in Budget's or Ryder's
expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy Budget Class A common stock nor shall there be
any sale of these securities in any state in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state.
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