SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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):
May 20, 1999
NATIONSRENT, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 001-14299 31-1570069
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
450 East Las Olas Blvd.
Fort Lauderdale, Florida 33301
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (954) 760-6550
N/A
(Former name or former address, if changed since last report)
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Item 5. Other Events
NationsRent, Inc., a Delaware corporation (the "Company"), announced on
May 20, 1999, that it had entered into a Termination and Release Agreement,
dated May 20, 1999 (the "Termination Agreement"), with Rental Service
Corporation, a Delaware corporation ("RSC"), pursuant to which the Company and
RSC have mutually agreed to terminate the Agreement and Plan of Merger, dated as
of January 20, 1999, between the Company and RSC (the "Merger Agreement") and to
abandon the proposed merger between the parties. As part of the Termination
Agreement, RSC will pay the Company $6 million as reimbursement of out-of-pocket
costs and expenses incurred in connection with or relating to the Merger
Agreement and the Termination Agreement and the performance of the Company's
obligations thereunder through May 20, 1999. The Company also separately entered
into a Stock Option Termination Agreement, dated May 20, 1999 (the "Stock Option
Termination Agreement"), with RSC, pursuant to which the Company and RSC agreed
to terminate the reciprocal stock options that each party had granted to the
other in connection with the Merger Agreement.
The foregoing description of each of the Termination Agreement and the
Stock Option Termination Agreement does not purport to be complete and is
subject to, and qualified in its entirety by reference to, the Termination
Agreement and the Stock Option Termination Agreement, respectively, which are
filed as exhibits hereto and are incorporated herein by reference.
Item 7. Exhibits.
99.1 Press Release, dated May 20, 1999.
99.2 Termination and Release Agreement, dated May 20, 1999,
by and between Rental Service Corporation and
NationsRent, Inc.
99.3 Stock Option Termination Agreement, dated May 20, 1999,
by and between Rental Service Corporation and
NationsRent, Inc.
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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.
NATIONSRENT, INC.
By: /s/ Joseph H. Izhakoff
---------------------------------
Name: Joseph H. Izhakoff
Title: Vice President
Date: May 20, 1999
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EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
99.1 Press Release, dated May 20, 1999.
99.2 Termination and Release Agreement, dated May 20, 1999,
by and between Rental Service Corporation and
NationsRent, Inc.
99.3 Stock Option Termination Agreement, dated May 20, 1999,
by and between Rental Service Corporation and
NationsRent, Inc.
[LETTERHEAD OF NATIONSRENT]
FOR IMMEDIATE RELEASE INVESTOR RELATIONS CONTACT:
Pamela Beall
Vice President/Treasurer
NationsRent
(954) 760-6562
MEDIA CONTACT:
Larry Larsen
Hill & Knowlton, Inc.
(312) 255-3084
Pager: 800-800-7759
NATIONSRENT AND RENTAL SERVICE CORPORATION
AGREE TO TERMINATE MERGER AGREEMENT
Fort Lauderdale, Fla. - May 20, 1999 - NationsRent, Inc. (NYSE: NRI) today
announced the termination of its merger agreement with Rental Service
Corporation.
James L. Kirk, chairman and chief executive officer, said, "As time progressed,
it became unlikely that we would be able to complete the merger on terms
beneficial to NationsRent and its shareholders. In addition, the terms of the
merger agreement restricted our ability to continue the growth of our business
through acquisitions and internal expansion. With the termination of this
agreement, we will be able to move forward with our backlog of letters of intent
and a definitive agreement to acquire seven equipment rental companies with 25
locations representing approximately $125 million of annual revenue. We continue
to see many opportunities to acquire complementary businesses at prices that are
accretive to earnings."
The Company said it expects to take a pre-tax charge in the second quarter
related to expenses incurred in connection with the merger agreement, which will
be partially offset by a $6 million payment to be received from Rental Service.
-more-
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NationsRent is headquartered in Fort Lauderdale, Fla., and presently ranks as
the fourth largest public company in the equipment rental industry. The Company
offers a broad selection of rental equipment including backhoes, bulldozers,
skid-steer loaders, aerial lift and work platforms, compressors and generators.
The Company markets its products and services to a broad range of construction
and industrial customers, including heavy highway contractors, subcontractors,
manufacturing plants and distribution centers. The Company's common stock is
traded on the New York Stock Exchange under the symbol NRI.
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are based on
current plans and expectations of the Company and involve risks and
uncertainties that could cause actual future activities and results to be
materially different from those set forth in these forward-looking statements.
Important factors that could cause actual results to differ include, among
others, risks associated with the absence of an operating history for the
combined businesses under a single management, the ability of the Company to
execute its acquisition strategy, the availability of additional capital,
variations in stock prices and interest rates, competition and fluctuations in
quarterly operating results and other risks and uncertainties described in the
Company's filings with the Securities and Exchange Commission. The Company
expressly disclaims any intent or obligation to update these forward-looking
statements.
# # #
TERMINATION AND RELEASE AGREEMENT
THIS TERMINATION AND RELEASE AGREEMENT (the "Agreement") is made and
entered into this 20th day of May, 1999, by and between Rental Service
Corporation, a Delaware corporation ("RSC"), and NationsRent, Inc., a Delaware
corporation ("NRI").
WITNESSETH:
WHEREAS, RSC and NRI (each, a "Party") entered into that certain
Agreement and Plan of Merger, dated as of January 20, 1999 (the "Merger
Agreement", and capitalized terms not otherwise defined herein shall have the
meaning ascribed to them in the Merger Agreement);
WHEREAS, in connection with the negotiations surrounding the Merger
Agreement, RSC and NRI each entered into a confidentiality agreement dated
January 12, 1999 (as amended through the date hereof, the "Confidentiality
Agreement"); and
WHEREAS, the parties hereto wish to terminate the Merger Agreement and
release their respective rights, claims, obligations, and liabilities in
connection therewith, and the board of directors of each Party has approved such
termination and authorized such Party to enter into this Agreement.
NOW, THEREFORE, in consideration of the covenants and agreements herein
set forth, the Parties agree as follows:
1. TERMINATION OF MERGER AGREEMENT. Effective immediately upon the
Effective Time, RSC and NRI abandon the Merger and mutually terminate the Merger
Agreement pursuant to Section 8.1 thereof. Notwithstanding anything to the
contrary contained in the Merger Agreement, from and after the Effective Time no
Released Party (as defined herein) shall have any liability or obligation under
the Merger Agreement.
2. EXPENSES. RSC agrees to pay NRI the amount of $6,000,000 (the
"Expense Reimbursement Amount"), intended solely to defray NRI's out-of-pocket
costs and expenses incurred in connection with or relating to the Merger
Agreement and this Agreement and the performance of NRI's obligations thereunder
through the date hereof, including, without limitation, fees and expenses of
financial, legal and accounting advisors. RSC and NRI agree that all other such
costs and expenses heretofore or hereafter incurred by each Party shall be borne
by the Party incurring such cost or expense. Simultaneous with its execution of
this Agreement, RSC shall pay the Expense Reimbursement Amount by wire transfer
of same day funds to the attorney's escrow account of Richards, Layton & Finger
designated on Exhibit A attached hereto. The time of receipt of such funds in
such account shall be deemed the "Effective Time" hereunder. The Expense
Reimbursement Amount shall be released to NRI from such attorney's escrow
account, by wire transfer of same day funds to NRI's account designated in
writing by NRI, promptly after the expiration of 72 hours after notice of such
deposit to the Court of Chancery of the State of Delaware and United Rentals,
Inc. (in compliance with any of such court's orders concerning any such payment)
unless, prior to the expiration of such 72 hour period, the Court of Chancery of
the State of Delaware shall have entered an order prohibiting or delaying such
release (a "Prohibitive Order"). Any such order shall not affect the right of
NationsRent, as between NationsRent and RSC, to receive the Expense
Reimbursement Amount from the escrow account, except as expressly provided in
such order. In the event a Prohibitive Order becomes final and non-appealable,
the Expense Reimbursement Amount shall be returned to RSC absent an order of a
court of proper jurisdiction to the contrary.
3. RELEASE AND WAIVER. Effective immediately upon the Effective Time,
each of RSC and NRI, and each of their respective predecessors, successors,
subsidiaries and assigns and any of the present and former officers, directors
and employees of the foregoing, in their capacity as such, hereby covenants not
to sue and forever releases and discharges NRI and RSC, respectively (and each
of their respective directors, officers, representatives, advisors (including
but not limited to financial advisors), attorneys, employees, agents, parents,
subsidiaries, affiliated persons and entities, predecessors, successors and
assigns and heirs, executors and administrators and all persons acting in
concert with any such party) (each, a "Released Party") from all manner of
claims, actions, causes of action or suits, at law or in equity, known or
unknown, which each now has or hereafter can, shall or may have by reason of any
matter, cause or thing whatsoever relating to or arising out of the Merger
Agreement or the agreements or instruments ancillary thereto or the transactions
contemplated thereby, excepting only any claim, action, cause of action or suit
arising out of (a) an undertaking or promise contained in this Agreement, or (b)
by virtue of obligations under the Confidentiality Agreement. Nothing in this
Section 3 shall in any way constitute an agreement by any party hereto to
indemnify any other party hereto against any third party claim.
4. PENDING LITIGATION. NRI agrees, promptly after the receipt of the
Expense Reimbursement Amount, to dismiss with prejudice its complaint in the
matter captioned NationsRent, Inc. v. United Rentals, Inc., et al., Case No.
99-07422 (filed April 30, 1999 in Florida Circuit Court for the 17th Judicial
Circuit in and for Broward County, Florida). NRI further agrees not to re-file
said suit or to file another suit against the captioned defendants or their
affiliates based on the same or similar claims set forth in the aforementioned
suit. The Parties agree there shall be no third party beneficiaries with respect
to this Section 4.
5. GOVERNING LAW. This Agreement, and all matters relating hereto,
shall be governed by, and construed in accordance with the laws of the State of
Delaware applicable to contracts to be made and performed wholly within such
state without reference to the conflict of laws principles thereof. The parties
hereby (a) irrevocably submit to the exclusive jurisdiction of the Chancery
Court of the State of Delaware and the federal courts of the United States of
America located in the State of Delaware solely
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in respect of the interpretation or enforcement of this Agreement and (b) waive,
and agree not to assert, as a defense in any action, suit or proceeding for the
interpretation or enforcement of this Agreement, that it is not subject to such
jurisdiction or that such action, suit or proceeding may not be brought or is
not maintainable in said courts or that the venue thereof may not be appropriate
or that this Agreement may not be enforced in or by such courts, and the parties
irrevocably agree that all claims with respect to such action or proceeding
shall be heard and determined exclusively in such courts. The parties hereby
consent to and grant any such courts jurisdiction over the person of such
parties and over the subject matter of such dispute and agree that mailing of
process or other papers in connection with any such action or proceeding in the
manner provided in Section 11 below, or in such other manner as may be permitted
by law, shall be valid and sufficient service thereof.
6. ENTIRE AGREEMENT. This Agreement and the Confidentiality Agreement
constitutes the entire agreement between the parties and supersede all prior
agreements and understandings, both written and oral, between the parties, or
any of them, with respect to the subject matter hereof.
7. COOPERATION. Each Party agrees to cooperate with the other and to
take all action reasonably necessary to give full effect to the provisions and
intent of this Agreement, including, without limitation, any action necessary to
defend the validity and enforceability of Section 2 hereof and, if necessary, to
seek the withdrawal or rescission of a Prohibitive Order. For such purpose, each
Party will bear its own costs and expenses incurred to take such action.
8. AMENDMENT AND MODIFICATION. This Agreement may be amended, modified,
and supplemented only by a written document executed by RSC and NRI which
specifically states that it is an amendment, modification or supplement to this
Agreement.
9. AUTHORIZATION. Each Party represents and warrants (i) this Agreement
has been duly and validly authorized, executed and delivered, subject to the
application of equitable remedies, and (ii) the person executing this Agreement
on its behalf is duly authorized and fully competent to execute this Agreement
on its behalf. In entering into this Agreement, the undersigned represent that
they have read all the terms hereof, have discussed the terms with counsel and
that such terms are fully understood and voluntarily accepted.
10. CONSTRUCTION. This Agreement shall be construed without regard to
the party or parties responsible for its preparation, and it shall be deemed to
have been prepared jointly by both parties. Any ambiguity or uncertainty arising
herein shall not be interpreted or construed against any party hereto.
11. NOTICES. Notices, requests instructions or other documents to be
given under this Agreement shall be in writing and shall be deemed given, (a)
when sent if sent
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by facsimile, provided that the facsimile is promptly confirmed by telephone
confirmation thereof to the intended recipient, (b) when delivered, if delivered
personally to the intended recipient, and (c) one business day later, if sent by
overnight delivery via a national courier service, and in each case, addressed
to a party at the following address for such party:
if to NRI:
NationsRent, Inc.
450 East Las Olas Blvd.
14th Floor
Ft. Lauderdale, FL 33301
Attention: Joseph H. Izhakoff, Esq.
Telecopier: (954) 760-6585
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: Joseph B. Frumkin, Esq.
Telecopier: (212) 558-3588
if to RSC:
Rental Service Corporation
6929 East Greenway Parkway
Suite 200
Scottsdale, Arizona 85254
Attention: Rosemary Strunk, Esq.
Telecopier: (480) 483-4024
with a copy to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, California 90071
Attention: Elizabeth A. Blendell, Esq.
Telecopier: (213) 891-8763
or to such other persons or addresses as may be designated in writing by the
party to receive such notice as provided above.
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12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same document.
13. SEVERABILITY.
(a) In the event that a Prohibitive Order is entered, or the
provisions of Section 2 hereof are otherwise found invalid or unenforceable in
any jurisdiction, and such event does not result from the breach of this
Agreement on the part of RSC or its directors, officers, employees, agents or
representatives, any such order or finding of invalidity or unenforceability
shall not render invalid or unenforceable in any jurisdiction the remaining
terms and provisions of this Agreement or affect the validity or enforceability
of any of the remaining terms or provisions of this Agreement.
(b) Any other term or provision of this Agreement that is invalid
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affect the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction, and if any provision of
this Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable; provided that,
notwithstanding the foregoing provisions of this Section 13(b), if any
reformation of this Agreement to cure any failure of validity or enforceability
in accordance with such provisions would so frustrate the intent and purposes of
the Parties such that a Party would not have entered into this Agreement as so
reformed, the severability provisions of this Section 13(b) shall not be applied
to cure any such failure.
14. ENFORCEMENT. The parties agree that in the event of a breach of any
provision of this Agreement irreparable damage would occur, the aggrieved party
would be without an adequate remedy at law, and damages would be difficult to
determine. The parties therefore agree that in the event of a breach of any
provision of this Agreement, subject to Section 3 above, the aggrieved party may
elect to institute and prosecute proceedings to enforce specific performance or
to enjoin the continuing breach of such provision. By seeking or obtaining such
relief, the aggrieved party will not be precluded from seeking or obtaining any
other relief to which it may be entitled at law or in equity.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, inure
to the benefit of and be enforceable by the parties and their respective
successors and assigns.
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized officers of the parties hereto as of the date first
written above.
RENTAL SERVICE CORPORATION
By: /s/ Robert M. Wilson
----------------------------
a duly authorized signatory
NATIONSRENT, INC.
By: /s/ James L. Kirk
----------------------------
Name: James L. Kirk
Title: Chief Executive Officer
STOCK OPTION TERMINATION AGREEMENT
THIS STOCK OPTION TERMINATION AGREEMENT (the "Agreement") is made and
entered into this 20th day of May, 1999, by and between Rental Service
Corporation, a Delaware corporation ("RSC"), and NationsRent, Inc., a Delaware
corporation ("NationsRent"). In consideration of the covenants and agreements
herein set forth, the parties agree as follows:
1. TERMINATION OF STOCK OPTION AGREEMENTS. Effective at 12:00 p.m. New
York City time on May 20, 1999 (the "Effective Time"), RSC and NationsRent
hereby mutually cancel and terminate for no consideration other than their
mutual covenants to so cancel and terminate (i) the Stock Option Agreement,
dated as of January 20, 1999, executed by RSC in favor of NationsRent and the
associated option on the common stock of RSC (the "NationsRent Stock Option"),
and (ii) the Stock Option Agreement, dated as of January 20, 1999, executed by
NationsRent in favor of RSC and the associated option on the common stock of
NationsRent (the "RSC Stock Option" and together with the NationsRent Stock
Option, the "Stock Options"). The parties acknowledge that neither of the Stock
Options has become exercisable prior to the Effective Time. Notwithstanding
anything to the contrary contained in the Stock Options, neither party hereto
(nor any of their respective directors, officers, representatives, advisors
(including but not limited to financial advisors), attorneys, employees, agents,
parents, subsidiaries, affiliated persons and entities, predecessors, successors
and assigns and heirs, executors and administrators and all persons acting in
concert with any such party) shall have any liability or obligation under the
Stock Options from and after the Effective Time.
2. GOVERNING LAW. This Agreement, and all matters relating hereto,
shall be governed by, and construed in accordance with the laws of the State of
Delaware applicable to contracts to be made and performed wholly within such
state without reference to the conflict of laws principles thereof. The parties
hereby (i) irrevocably submit to the exclusive jurisdiction of the Chancery
Court of the State of Delaware and the federal courts of the United States of
America located in the State of Delaware solely in respect of the interpretation
or enforcement of this Agreement and (ii) waive, and agree not to assert, as a
defense in any action, suit or proceeding for the interpretation or enforcement
of this Agreement, that it is not subject to such jurisdiction or that such
action, suit or proceeding may not be brought or is not maintainable in said
courts or that the venue thereof may not be appropriate or that this Agreement
may not be enforced in or by such courts, and the parties irrevocably agree that
all claims with respect to such action or proceeding shall be heard and
determined exclusively in such courts. The parties hereby consent to and grant
any such courts jurisdiction over the person of such parties and over the
subject matter of such dispute and agree that mailing of process or other papers
in connection with any such action or proceeding in the manner provided in
Section 7 below, or in such other manner as may be permitted by law, shall be
valid and sufficient service thereof.
<PAGE>
3. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements and understandings, both
written and oral, between the parties, or any of them, with respect to the Stock
Options and the termination and cancellation thereof.
4. AMENDMENT AND MODIFICATION. This Agreement may be amended, modified,
and supplemented only by a written document executed by RSC and NationsRent
which specifically states that it is an amendment, modification or supplement to
this Agreement.
5. AUTHORIZATION. Each party represents and warrants that (i) this
Agreement has been duly and validly authorized, executed and delivered, subject
to the application of equitable remedies, and (ii) the person executing this
Agreement on its behalf is duly authorized and fully competent to execute this
Agreement on its behalf and that its execution of this Agreement and its
performance hereunder has been approved by its Board of Directors. In entering
into this Agreement, the undersigned represent that they have read all the terms
hereof, have discussed the terms with counsel and that such terms are fully
understood and voluntarily accepted.
6. CONSTRUCTION. This Agreement shall be construed without regard to
the party or parties responsible for its preparation, and it shall be deemed to
have been prepared jointly by both parties. Any ambiguity or uncertainty arising
herein shall not be interpreted or construed against any party hereto.
7. NOTICES. Notices, requests instructions or other documents to be
given under this Agreement shall be in writing and shall be deemed given, (i)
when sent if sent by facsimile, provided that the facsimile is promptly
confirmed by telephone confirmation thereof to the intended recipient, (ii) when
delivered, if delivered personally to the intended recipient, and (iii) one
business day later, if sent by overnight delivery via a national courier
service, and in each case, addressed to a party at the following address for
such party:
if to NationsRent:
NationsRent, Inc.
450 East Las Olas Blvd.
14th Floor
Ft. Lauderdale, FL 33301
Attention: Joseph H. Izhakoff, Esq.
Telecopier: (954) 760-6585
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with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: Joseph B. Frumkin, Esq.
Telecopier: (212) 558-3588
if to RSC:
Rental Service Corporation
6929 East Greenway Parkway
Suite 200
Scottsdale, Arizona 85254
Attention: Rosemary Strunk, Esq.
Telecopier: (480) 483-4024
with a copy to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, California 90071
Attention: Elizabeth A. Blendell, Esq.
Telecopier: (213) 891-8763
or to such other persons or addresses as may be designated in writing by the
party to receive such notice as provided above.
8. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same document.
9. SEVERABILITY. Any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affect the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction, and if any provision of
this Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable; provided that,
notwithstanding the foregoing provisions of this Section 9, if any reformation
of this Agreement to cure any failure of validity or enforceability in
accordance with such provisions would so frustrate the intent and purposes of
the Parties such that a Party would not have entered into this Agreement as so
reformed, the severability provisions of this Section 9 shall not be applied to
cure any such failure.
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10. ENFORCEMENT. The parties agree that in the event of a breach of any
provision of this Agreement irreparable damage would occur, the aggrieved party
would be without an adequate remedy at law, and damages would be difficult to
determine. The parties therefore agree that in the event of a breach of any
provision of this Agreement, the aggrieved party may elect to institute and
prosecute proceedings to enforce specific performance or to enjoin the
continuing breach of such provision. By seeking or obtaining such relief, the
aggrieved party will not be precluded from seeking or obtaining any other relief
to which it may be entitled at law or in equity.
11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, inure
to the benefit of and be enforceable by the parties and their respective
successors and assigns.
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized officers of the parties hereto as of the date first
written above.
RENTAL SERVICE CORPORATION
By: /s/ Robert M. Wilson
---------------------------------
a duly authorized signatory
NATIONSRENT, INC.
By: /s/ James L. Kirk
---------------------------------
Name: James L. Kirk
Title: Chief Executive Officer
