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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
SCHEDULE 14A INFORMATION
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive proxy statement
[ ] Definitive additional materials
[X] Soliciting material pursuant to Rule 14a-12
UNITED ROAD SERVICES, INC.
(Name of Registrant as Specified in Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transactions
applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price of other underlying value of transaction computer
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
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(1) Amount previously paid:
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-1-
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(3) Filing party:
(4) Date filed:
Investors are urged to read any relevant documents filed by United Road with the
Securities and Exchange Commission because they will contain important
information. Investors will be able to obtain these documents, when available,
for free from the SEC's web site, www.sec.gov or from United Road, at 518-446-
0140.
United Road Services, Inc. may be deemed to be a participant in the solicitation
of proxies in respect of the transactions contemplated by the Stock Purchase
Agreement, dated as of April 14, 2000, by and between United Road and Blue Truck
Acquisition, LLC.
The participants in this solicitation may also include the following directors
of United Road: Gerald R. Riordan, Grace M. Hawkins, Edward W. Morawski, Richard
A. Molyneux, Todd Q. Smart, Mark J. Henninger, Merril M. Halpern, Robert L.
Berner, III and Michael S. Pfeffer.
Press Release of United Road dated April 14, 2000
URSI Announces $25.0 Million Equity Investment, Results for Fourth Quarter ended
December 31, 1999 and Year ended December 31, 1999 Results
Albany, NY, April 14/ PR Newswire/ -- United Road Services, Inc. (NASDAQ: URSI)
United Road Services announced today that an affiliate of KPS Special Situations
Fund, L.P. ("KPS"), a private equity fund, has agreed to invest $25 million in
the Company in exchange for participating convertible preferred stock. The
preferred stock carries a dividend of 5.5 % per annum until 2006 and 5.0% per
annum thereafter, payable in cash or in kind at the option of the Company until
2005 and in cash thereafter. The obligation to pay dividends terminates in 2008
or earlier if the Company's common stock trades above a specified price. The
preferred stock is convertible at any time at the option of the holder into
shares of the Company's common stock at a conversion price of the lesser of
$2.00 or the average trading price of the common stock for the 30 trading days
prior to closing, subject to adjustment under certain circumstances. In
connection with the transaction, KPS will have the right to designate a majority
of the Company's Board of Directors as long as KPS continues to own specified
amounts of preferred stock. Completion of the KPS transaction is subject to a
number of conditions, including approval of the Company's stockholders and the
availability of a replacement or refinancing of the Company's credit facility
providing for at least $25.0 million of available borrowings in addition to the
amounts currently outstanding. There can be no assurance that the KPS
transaction will be consummated.
Gerald Riordan, Chief Executive Officer of the Company commented "The investment
by KPS will eliminate a major obstacle to the turn-around of United Road
Services. We have a new and committed management team, a clear action plan which
is beginning to show improvement, customers that value our services and, with
this transaction, an enhanced capital structure to continue to invest in the
business. I look forward to working with Mike Psaros and the KPS team in
creating value for our shareholders in the future."
Mr. Michael Psaros, a principal of KPS, added, "This transaction marks a new
beginning for United Road Services that will allow the Company to execute its
business strategy and realize its potential as a premier national provider of
transport, towing and recovery services. We have great confidence in the
Company's new senior management team and the business and we believe that our
equity investment, coupled with a new credit facility, will provide the Company
with the capital resources needed to complete its restructuring program. We are
excited about this investment and we look forward to working with the Company's
employees to complete the integration of the Company's assets, deliver premier
service to our customers and maximize value for the Company's stockholders."
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KPS, founded in 1998, is a private equity firm with over $210.0 million of
committed capital that invests in middle market companies requiring operational,
financial or strategic restructuring.
The Company reported revenues of $66.0 million and a net loss of $28.5 million,
which includes a non-cash impairment charge of $28.3 million or a loss of $1.66
per diluted share, for the quarter ended December 31, 1999. Revenues were
$255.1 million, and the net loss was $29.7 million, or $1.75 per diluted share,
for the year ended December 31, 1999. In connection with the diluted per share
amounts, weighted average shares outstanding were 17,128,308 and 16,933,114 for
the quarter ended and year ended December 31, 1999, respectively.
For the quarter ended December 31, 1998, the Company reported revenues of $43.1
million and net income of $2.2 million, or $0.15 per diluted share. For the year
ended December 31, 1998, revenues were $87.9 million, and net income was $4.4
million, or $0.42 per diluted share. In connection with the diluted per share
amounts, weighted average shares outstanding were 14,942,391 and 10,389,903 for
the quarter ended and year ended December 31, 1998, respectively.
EBITDA for the fourth quarter of 1999 was a negative $27.6 million, resulting in
negative EBITDA of $8.7 million for the year ended December 31, 1999. Excluding
the impact of special and impairment charges, EBITDA for the fourth quarter of
1999 would have been $1.6 million and EBITDA for the year ended December 31,
1999 would have been $22.4 million. EBITDA for the fourth quarter of 1998 was
$7.4 million, resulting in 1998 EBITDA of $14.5 million.
The Company periodically reviews the recorded value of its long-lived assets and
the recoverability of goodwill to determine if the carrying amount of those
assets may not be recoverable based upon the future operating cash flows
expected to be generated by those assets. During the fourth quarter of 1999,
based upon a comprehensive review, the Company recorded a non-cash impairment
charge of $28.3 million. As such, the carrying values of these assets were
written down to the Company's estimates of fair value. Additionally, other
fourth quarter non-recurring charges consisted of $946,000 in severance expense
relating to the departure of two members of senior management in December of
1999.
Formed in July 1997, United Road Services has a network of 43 divisions located
in 22 states. The Company's broad range of services includes towing, impounding
and storing motor vehicles, conducting lien sales and auctions of abandoned
vehicles and transporting new and used vehicles and heavy construction
equipment. More information on United Road Services may be obtained from the
Company's web site at www.unitedroad.com.
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This release contains forward-looking statements. These statements are subject
to certain risks and uncertainties that could cause actual results to differ
materially from those anticipated in the forward-looking statements. Readers
should not place undue reliance on forward-looking statements, which reflect
management's view only as of the date hereof. The Company undertakes no
obligation to publicly revise these forward-looking statements to reflect
subsequent events or circumstances. Readers should carefully review the risk
factors described in documents the Company files from time to time with the
Securities and Exchange Commission.
For additional information, contact Dorraine Teitsch. Investor Relations at
(518) 446-0140.
