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FILE NO. 33-56131
FILED PURSUANT TO RULE 424(C)
PROSPECTUS SUPPLEMENT, DATED JANUARY 13, 1995
(TO PROSPECTUS DATED NOVEMBER 29, 1994)
(LOGO)
16,279,070 SHARES
GREYHOUND LINES, INC.
COMMON STOCK
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Reference is made to the Prospectus dated November 29, 1994 relating to the
offering by Greyhound Lines, Inc. (the "Company") of up to 16,279,070 shares of
its common stock, par value $.01 per share (the "Common Stock"), pursuant to
transferable rights issued to persons who were on November 29, 1994 holders of
record of Common Stock. All capitalized terms used in this Prospectus Supplement
and not otherwise defined herein are used herein with the meaning given those
terms in the Prospectus.
RESULTS OF THE RIGHTS OFFERING
On December 22, 1994, the Company announced that each of the Minimum
Proceeds Condition and the Minimum Tender Condition had been satisfied. The
Rights Offering was extended until 5:00 p.m. New York City Time on December 28,
1994 to permit additional stockholders to exercise their Primary Subscription
Privileges and their Over-Subscription Privileges. In the Rights Offering,
7,384,880 shares were subscribed for pursuant to Primary Subscription
Privileges, 2,240,046 shares were subscribed for pursuant to Over-Subscription
Privileges (including 2,181,977 shares pursuant to the Committed
Oversubscription (as defined below)) and 6,654,144 shares were subscribed for
pursuant to the Standby Purchase Arrangements described below.
STANDBY PURCHASERS AND COMMITTED OVERSUBSCRIPTION
Prior to the Rights Expiration Time, the Company reached agreements with
two persons to act as standby purchasers (the "Standby Purchasers") in the
Rights Offering. The Standby Purchasers committed to purchase, in the aggregate,
up to 7,045,000 New Shares, to the extent that there were any New Shares
remaining after all Primary Subscription Privileges and Over-Subscription
Privileges exercised in the Rights Offering had been satisfied in full. In
addition, accounts managed by Snyder Capital Management, Inc. committed to
oversubscribe (the "Committed Oversubscription") for up to 2,182,000 New Shares.
The material terms of the standby purchase agreements and of the arrangements
with respect to the Committed Oversubscription are described below.
Transportation Manufacturing Operations, Inc.
Transportation Manufacturing Operations, Inc. ("TMO"), a wholly owned
subsidiary of Motor Coach Industries International, Inc. ("MCII"), agreed to act
as a Standby Purchaser in the Rights Offering. Motor Coach Industries, Inc.
("MCI"), a subsidiary of TMO, is the Company's principal supplier of new motor
coaches. TMO agreed to purchase, at the Exercise Price, up to 6,395,000 New
Shares to the extent that there were New Shares remaining at the conclusion of
the Rights Offering. The Company agreed that TMO, at its option, could assign
its standby purchase obligations to another affiliate of MCII. TMO assigned its
standby purchase obligations to Motor Coach Industries Limited.
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As an inducement to serve as a Standby Purchaser, the Company paid TMO a
commitment fee equal to $137,492.50 (representing 1% of TMO's total standby
purchase commitment), and a takedown fee equal to $387,267.29 (representing 3%
of the Exercise Price paid for the New Shares actually purchased by TMO pursuant
to the standby commitment). In addition, the Company extended the term of the
Bus Purchase Requirements Agreement dated March 18, 1987 between the Company,
MCI and Transit Bus International, Inc., which also is a subsidiary of MCII,
from March 18, 1997 to March 18, 1998. The Company must purchase at least 75% of
its new bus requirements, if any, pursuant to that agreement. The Company also
has agreed that, not later than 45 days (the "Repayment Date") after January ,
1995, the Company will prepay (the "Required Prepayment") a portion of the
"purchase price" to become due and payable under a Conditional Sales Contract
and Security Agreement entered into in 1994 between the Company and MCI and
assigned to MCI Acceptance Corp. ("MCIAC"), a wholly owned subsidiary of MCII.
The Conditional Sales Contract to be repaid arose out of the financing of
certain intercity coaches purchased by the Company in 1994, and the obligations
thereunder currently bear interest at the prime rate plus 1.5% per annum and
mature over ten years. The Required Prepayment will be financed from the
proceeds of a refinancing of all or a portion of the bus financing provided by
MCIAC and/or from available borrowings under the New Credit Facility so long as
there is no default thereunder. Any portion of the Required Prepayment that is
not made on time will begin accruing interest, as of the Repayment Date, at an
additional rate of 1/2% per annum per week until paid in full (up to the
maximum interest rate permitted under applicable law). In addition, the Company
has agreed that it will use its best efforts to refinance, on commercially
reasonable terms, all other amounts owed to MCIAC. At December 31, 1994, the
aggregate principal amount owed to MCIAC was approximately 20,570,590 million.
As part of the standby purchase agreement, the Company also has granted TMO two
demand registration rights with respect to the New Shares purchased by it, and
will bear all the expenses (other than discounts and commissions and fees and
expenses of TMO's counsel) of effecting the registration of those shares.
Connor, Clark & Company, Ltd.
Connor, Clark & Company, Ltd. ("Connor Clark"), the Company's largest
shareholder, agreed to act as a Standby Purchaser with respect to up to 650,000
New Shares, all of which were purchased by it upon the conclusion of the Rights
Offering. As an inducement to serve as a Standby Purchaser, the Company paid
Connor Clark a commitment fee of $13,975 (representing 1% of Connor Clark's
total standby purchase commitment) and a takedown fee of $69,875 (representing
5% of the Exercise Price) in respect of the New Shares actually purchased by it
pursuant to the standby purchase commitment.
Connor Clark and certain of its affiliates tendered an aggregate of
$1,338,000 principal amount of Convertible Debentures in the Conversion on the
same basis as the other holders of the Convertible Debentures.
Snyder Capital Management, Inc.
Snyder Capital Management, Inc. ("SCM"), on behalf of 49 accounts managed
by it (the "SCM Accounts"), committed to oversubscribe for up to an aggregate of
2,181,977 New Shares. Because the SCM Accounts exercised their Oversubscription
Privileges, and because there were sufficient unsubscribed shares available, the
SCM Accounts received all the shares for which they had oversubscribed before
any New Shares were taken by the Standby Purchasers.
In consideration for the Committed Oversubscription, the Company paid each
SCM Account a commitment fee equal to 1% of the aggregate Exercise Price for
each account's pro rata portion of the Committed Oversubscription (or $46,912.51
in the aggregate to the SCM Accounts taken as a whole). In addition, each SCM
Account received a fee equal to 5% of the Exercise Price actually paid for any
New Shares acquired pursuant to the Committed Oversubscription (or $234,562.53
in the aggregate to the SCM Accounts taken as a whole).
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