<PAGE> 1
As filed with the Securities and Exchange Commission on August 31, 1995.
Registration No. 33-61331
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
Amendment No. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
____________________
GREYHOUND LINES, INC.
(Exact Name of Company as Specified in Its Charter)
<TABLE>
<S> <C>
DELAWARE 86-0572343
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification Number)
15110 N. DALLAS PARKWAY, SUITE 600 MARK E. SOUTHERST, GENERAL COUNSEL
DALLAS, TEXAS 75248 15110 NORTH DALLAS PARKWAY, SUITE 600
(214) 789-7000 DALLAS, TEXAS 75248
(Address, Including Zip Code, and Telephone Number, (214) 789-7000
Including Area Code, of Company's Principal (Name, Address, Including Zip Code, and Telephone
Executive Offices) Number, Including Area Code, of Agent for Service)
Copies to:
LAWRENCE D. STUART, JR. HENRY D. KAHN
WEIL, GOTSHAL & MANGES PIPER & MARBURY L.L.P.
100 CRESCENT COURT, SUITE 1300 53 WALL STREET
DALLAS, TEXAS 75201 NEW YORK, NEW YORK 10005
</TABLE>
______________________
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box: [ ]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
___________________
THE COMPANY HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE COMPANY SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE> 2
***************************************************************************
* *
* Information contained herein is subject to completion or amendment. *
* A registration statement relating to these securities has *
* been filed with the Securities and Exchange Commission. These *
* securities may not be sold nor may offers to buy be accepted prior *
* to the time the registration statement becomes effective. This *
* prospectus shall not constitute an offer to sell or the *
* solicitation of an offer to buy 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. *
* *
***************************************************************************
SUBJECT TO COMPLETION, DATED AUGUST 31, 1995
PROSPECTUS
[LOGO] 10,004,144 SHARES
GREYHOUND LINES, INC.
COMMON STOCK
Of the 10,004,144 shares of common stock, par value $.01 per share
(the "Common Stock"), of Greyhound Lines, Inc. (the "Company") offered hereby
(the "Offering"), 4,000,000 shares are being sold by the Company and 6,004,144
shares are being sold by the Selling Stockholder. See "Selling Stockholder."
The Company will not receive any of the proceeds from the sale of shares by the
Selling Stockholder. The Company's Common Stock is traded on the American
Stock Exchange under the symbol "BUS." On August 29, 1995, the last reported
sale price of the Common Stock on the American Stock Exchange was $4.3125 per
share. See "Market Price of Common Stock and Dividend Policy."
SEE "RISK FACTORS" BEGINNING ON PAGE 10 FOR CERTAIN CONSIDERATIONS
RELEVANT TO AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY.
___________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
=========================================================================================================
Proceeds to
Price to Agent's Proceeds to Selling
Public Commission(1) Company (2) Stockholder
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per Share . . . . . . $ $ $ $
- ---------------------------------------------------------------------------------------------------------
Total . . . . . . . . $ $ $ $
=========================================================================================================
</TABLE>
(1) The Company and the Selling Stockholder have retained Rothschild Inc.
as agent (the "Selling Agent") to act on their behalf to obtain
purchasers for the shares of Common Stock offered hereby. The Selling
Agent has made no firm commitment and is under no obligation to
purchase or sell all or any part of the shares of Common Stock offered
hereby, but has agreed to use its best efforts to solicit and receive
offers to purchase the Common Stock on terms acceptable to the Company
and the Selling Stockholder. The Company and the Selling Stockholder
have agreed (i) to pay the Selling Agent a fee in connection with the
sale of the Common Stock and (ii) to indemnify the Selling Agent
against certain liabilities under the Securities Act of 1933, as
amended. See "Plan of Distribution."
(2) Before deducting expenses payable by the Company, estimated at
$ .
The shares of Common Stock are offered by Rothschild Inc. solely as
agent for the Company and the Selling Stockholder, subject to the several right
of the Company and the Selling Stockholder to reject orders in whole or in
part. It is expected that delivery of the certificates representing the shares
of Common Stock will be made against payment therefor at the offices of
Rothschild Inc., New York, New York, on or about , 1995.
_______________
ROTHSCHILD INC.
_______________
The date of this Prospectus is , 1995.
<PAGE> 3
IN CONNECTION WITH THE OFFERING, THE SELLING AGENT MAY EFFECT TRANSACTIONS
WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK AT LEVELS
ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE AMERICAN STOCK EXCHANGE OR OTHERWISE. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-3 (together with all
amendments and exhibits thereto, the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Common Stock offered hereby. This Prospectus does not include all the
information set forth in the Registration Statement and the exhibits thereto,
to which reference is made for further information with respect to the Company.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules
and regulations thereunder, and in accordance therewith files periodic reports,
proxy and information statements, and other information with the Commission.
The Registration Statement and the exhibits thereto and all reports, proxy and
information statements, and other information filed by the Company with the
Commission may be inspected at the public reference facilities maintained by
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and may also
be inspected and copied at the regional offices of the Commission located at 7
World Trade Center, 13th Floor, New York, New York 10048 and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials may be
obtained from the Public Reference Section of the Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. The Common Stock is listed
on the American Stock Exchange and all reports, proxy and information
statements, and other information filed by the Company with the Commission also
may be inspected at the American Stock Exchange, 86 Trinity Place, New York,
New York 10006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are incorporated
into this Prospectus by reference:
(1) The Company's Annual Report on Form 10-K for the year ended
December 31, 1994, as amended on Form 10-K/A;
(2) The Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1995;
(3) The Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995; and
(4) The Company's Registration Statement on Form 10 filed August
23, 1991, as amended by Form 8, Amendment No. 6.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the Offering shall be deemed to be incorporated by reference in
this Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of the Prospectus.
The Company will provide without charge to each person, including any
beneficial owner of Common Stock, to whom a copy of this Prospectus has been
delivered, upon the written or oral request of such person, a
2
<PAGE> 4
copy of any and all of the documents which have been or may be incorporated by
reference in this Prospectus, except that exhibits to such documents will not
be provided unless they are specifically incorporated by reference into such
documents. Requests for copies of any such document should be directed to
Greyhound Lines, Inc., 15110 N. Dallas Parkway, Suite 600, Dallas, Texas 75248,
Attention: Investor Relations, telephone: (214) 789-7577.
3
<PAGE> 5
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more
detailed information and consolidated financial statements (including the notes
thereto) appearing elsewhere or incorporated by reference in this Prospectus.
As used in this Prospectus, unless the context indicates otherwise, the
"Company" means Greyhound Lines, Inc. and its consolidated subsidiaries, taken
as a whole. Unless otherwise indicated, the information presented in this
Prospectus assumes that all shares of Common Stock offered by the Company are
sold in the Offering.
THE COMPANY
Greyhound Lines, Inc. (the "Company") is the only nationwide provider
of intercity bus transportation services in the United States. The Company
currently provides scheduled passenger service to more than 2,450 destinations
with a fleet of approximately 2,000 buses and approximately 1,700 sales
outlets. The Company also provides package express delivery service, charter
service and, in certain terminals, food service. The Company's executive
offices are located at 15110 N. Dallas Parkway, Suite 600, Dallas, Texas 75248,
and its telephone number is (214) 789-7000.
BUSINESS STRATEGY
Following a substantial decline in ridership and revenues, the Company
hired a new Chief Executive Officer and Chief Operating Officer, each of whom
has substantial experience in the bus industry, as well as a new Chief
Financial Officer. In response to a review of the Company's operations, this
management team has implemented a "back to basics" strategy focusing on
increasing revenues and improving customer service. This strategy seeks to
maximize the unique value of the Company's national bus network by serving both
long- and short-haul markets, connecting rural and urban America and providing
transportation between major cities. To implement its strategy, the Company is
increasing operating capacity, telephone answering capacity, and its emphasis
on long-haul bus routes. Additionally, the Company is actively managing
pricing in individual markets, reducing the use of deeply discounted
promotional tickets, and introducing everyday low pricing. The Company's new
strategy is supported by a marketing campaign that integrates advertising,
public relations, sales promotion and pricing.
As part of its revenue enhancement plans, the Company has begun to
reestablish relations with regional bus carriers to improve interline service
and to increase the use of shared terminals. Management is also developing
programs to improve its package express delivery service through system
upgrades, localized marketing strategies and price and schedule improvements,
and to increase its position in the charter business through targeted local
selling in selected markets. Additionally, the Company will continue its
efforts to develop markets where it believes there are revenue opportunities,
such as those along the U.S.-Mexico border and between major Hispanic
population centers in the U.S.
Many of the Company's operating expenses are fixed costs or costs that
cannot be changed rapidly. Accordingly, costs such as depreciation,
amortization and lease expenses related to the bus fleet and facilities,
maintenance, driver operations and customer service generally do not vary
proportionately with short-term changes in demand for the Company's services.
Management believes that there are limited opportunities to further reduce the
Company's cost structure and that returning the Company to profitability will
be dependent on increasing revenues. Moreover, the revenue enhancement
strategy, which involves, in part, providing more convenient service over the
Company's routes, as well as the addition of new schedules to meet customer
travel preferences, will require the Company to incur additional expenses
during 1995 and future years compared to 1994.
The Company currently uses an automated system ("TRIPS") at
approximately 250 terminals to sell tickets, to manage revenue and seat
capacity and to quote fare and schedule information. In June 1995,
approximately 81% of the tickets sold by the Company were generated using TRIPS
compared to 65% in January 1994. Since May 1994 TRIPS has maintained a 99%
scheduled system availability and ticketing speed is comparable to the
Company's predecessor system. The Company has de-emphasized the reservation
portion of its TRIPS system in order to simplify the ticketing process, further
reduce ticketing time, and provide for more
4
<PAGE> 6
responsive telephone service. To further improve customer service the Company
has modified its telephone answering procedures and opened a new telephone
center to provide more telephone-answering capacity. These improvements have
resulted in an increase in the number of unique callers reaching the telephone
information center from approximately 70% in July 1994 to in excess of 95% in
July 1995 and resulted in 10.5 million calls being handled during the first six
months of 1995 representing a 15.6% increase from the same period in 1994.
Since the beginning of 1993, the Company has acquired 864 new buses,
including 102 new buses from Motor Coach Industries International ("MCII")
delivered in June and July of this year, and disposed of 1,615 older buses as
part of its program to modernize and standardize the fleet. As a result, the
average age of the fleet has been reduced from 9.5 years in January 1993 to 6.5
years in August 1995. However, 32% of the Company's bus fleet remains in
excess of 10 years old. While the Company could continue to use these older
buses, the Company intends, over time, to replace these older, less reliable
vehicles with new buses. The Company believes that newer buses, as well as
older buses with newer engines, are more fuel efficient than buses with older
engines. New buses generally require less maintenance and are less costly to
maintain, in part because of warranty coverage. The Company also anticipates
acquiring new buses to increase the size of the fleet in order to implement its
plan to increase revenues by operating additional bus miles. Moreover, due to
technical design improvements and governmental regulations, the principal bus
engine model used in the Company's fleet will no longer be available after
1997. In anticipation of this change, the Company expects to acquire and begin
advance testing of new bus models. The Company expects to acquire up to 300
new buses over the next 18 months. Orders have been placed for 23 new MCII
buses for delivery in September 1995 and the Company is negotiating a further
50 bus order for delivery in December 1995. Financing for these 50 buses has
been offered by MCII. Additional orders will be placed subject to the
availability of financing on suitable terms, through a variety of methods,
including borrowings under its credit agreement, operating and capital leases
and the possible sale of securities. While the Company believes that available
facilities will provide the necessary funds for a significant portion of these
buses and that recent operating trends will support additional financing, there
can be no assurance that the Company will be able to obtain additional
financing on suitable terms for these purposes.
RECENT DEVELOPMENTS
Second Quarter 1995 Results Compared to Second Quarter of 1994 Results
Operating revenues for the second quarter of 1995 were $161.4 million
representing a $10.3 million or 6.8% increase over revenues of $151.1 million
for the second quarter of 1994 as passenger counts increased by approximately
7.1% over the second quarter of 1994. This increase was achieved despite the
impact in the second quarter of 1994 of a short advance purchase, deep discount
"$68 or Less" fare promotion. The promotion resulted in lower yields (revenue
per passenger mile) during the second quarter of last year (9.32 cents per
mile) versus this year (9.61 cents per mile). The promotion was discontinued
for the second half of 1994.
The operating loss for the second quarter of 1995 was $2.8 million
compared to a $27.1 million operating loss for the second quarter of 1994. The
operating loss for the second quarter of 1994 reflected $20.5 million of
certain operating charges for a number of items including claims from the
Company's 1990 bankruptcy, increased cost estimates for environmental
remediation, and an adjustment to depreciation to recognize impairment of
certain operating facilities which are less than fully utilized. Excluding the
impact of these certain charges, the operating loss for the second quarter of
1994 would have been approximately $6.6 million.
The net loss for the second quarter of 1995 was $9.9 million compared
to a $45.4 million net loss for the second quarter of 1994. In addition to the
$20.5 million in certain charges discussed above, net income for the second
quarter of 1994 reflected the impact of a $10.6 million adjustment to income
taxes to reverse tax benefits recorded in the first quarter of 1994. See
"Summary Selected Historical Financial and Operating Data."
Financial Forecasts
In October 1994, in connection with a prospective tender offer and
rights offering, the Company issued Financial Forecasts for 1995 and 1996 (the
"Financial Forecast"). Management has recently completed a review of the 1995
Financial Forecast as compared to the Company's performance for the six month
period ended June 30, 1995. As a result of this review, management presently
believes that both passenger revenues and expenses for 1995 will be higher than
those set forth in the 1995 Financial Forecast.
5
<PAGE> 7
Under management's "back to basics" strategy, the Company has
increased its operating capacity and schedule offerings and, accordingly, is
running a greater number of bus miles than were assumed in the Financial
Forecast. To support this planned increase in operating capacity, the Company
has and will continue to incur in 1995 certain expenses not anticipated in the
Financial Forecast, such as hiring and training new bus drivers, adding
operating management in the field and opening a new telephone center.
Management believes that the additional passenger miles being operated
will generate additional revenues that will roughly offset the related increase
in expenses. Based on this anticipated increase in revenue attributable to
additional bus miles, the Company currently expects that it will generate
operating income in 1995 in an amount reasonably consistent with the operating
income projected in the 1995 Financial Forecast.
New Credit Facility
In June 1995, the Company renegotiated its existing credit facility
(the "New Credit Facility"). The New Credit Facility provides for revolving
loans, letters of credit and letter of credit guarantees up to a maximum
commitment of $73.5 million. Syndication commitments under the New Credit
Facility, including Foothill Capital Corporation's ("Foothill") commitment as
the lead agent, total $65.0 million at August 30, 1995. Availability under the
New Credit Facility is limited to the aggregate of the following: (1)
revolving advances of up to $3.5 million based on a formula of certain eligible
accounts receivable; (2) revolving advances of up to $35.0 million (subject to
increase to $45.0 million under certain circumstances) (the "Fixed Asset
Advances") based on the value of certain fixed asset collateral pledged to
Foothill; and (3) a bus purchase facility of up to $26.5 million (the "Bus
Purchase Facility"). Borrowings under the New Credit Facility mature on May
31, 1998, although availability under the Fixed Asset Advances will be subject
to quarterly reductions after April 1996. The New Credit Facility is secured
by liens on substantially all the assets of the Company, excluding real estate
purchases and new bus purchases unless those buses are specifically pledged to
support borrowings under the Bus Purchase Facility. The New Credit Facility
allows the Company to dispose of certain non-core real estate properties. In
addition, non-bus capital expenditures are limited to $25.0 million annually
with no spending limitations on bus purchases as long as financed through debt,
or operating or capital leases with maturities of no less than five years. The
New Credit Facility is subject to certain financial covenants, including
maintenance of a minimum net worth and an agreed ratio of cash flow to interest
expense.
6
<PAGE> 8
THE OFFERING
<TABLE>
<S> <C>
Common Stock Offered By:
The Company . . . . . . . . . . . . . 4,000,000 shares
The Selling Stockholder . . . . . . . 6,004,144 shares
----------
Total . . . . . . . . . . . . . . 10,004,144 shares
==========
Common Stock to be Outstanding after the
Offering . . . . . . . . . . . . . . 58,158,726 shares(1)
Use of Proceeds . . . . . . . . . . . . . The Company will use approximately $9.7 million of the net
proceeds from its sale of Common Stock to repurchase (the
"Senior Note Repurchase") approximately $10.7 million aggregate
principal of its 10% Senior Notes due 2001 (the "Senior Notes")
at an effective price of approximately $860 per $1,000 bond.
These repurchased Senior Notes will be applied toward future
sinking fund obligations. The Company will use the remaining
proceeds for general corporate purposes. See "Use of Proceeds."
The Company will not receive any of the proceeds from the sale of
shares by the Selling Stockholder.
Dividend Policy . . . . . . . . . . . . . The Company has not paid dividends on the Common Stock in the
past and does not expect to pay any dividends on the Common
Stock in the foreseeable future.
American Stock Exchange Symbol . . . . . BUS
Risk Factors . . . . . . . . . . . . . . See "Risk Factors" for a discussion of certain information that
should be considered by prospective purchasers of the Common
Stock.
</TABLE>
__________________
(1) Does not include 7,939,446 shares of Common Stock reserved for
issuance pursuant to the Company's stock option program (of which 5,122,536
shares were subject to outstanding options at June 30, 1995 with a weighted
average exercise price of $3.48), and 792,242 shares issuable upon conversion
of the Company's outstanding 8.5% Convertible Subordinated Debentures due March
31, 2007 (the "Convertible Debentures") at a conversion price of $12.375 per
share.
7
<PAGE> 9
SUMMARY SELECTED HISTORICAL FINANCIAL AND OPERATING DATA
(IN THOUSANDS EXCEPT PER SHARE, OTHER DATA AND OPERATING DATA)
The selected financial data presented below for the three years ended
December 31, 1992, 1993 and 1994 have been derived from the Company's audited
consolidated financial statements. The selected financial data at and for the
six- and three-month periods ended June 30, 1994 and 1995 have been derived
from the unaudited consolidated financial statements and internal accounting
records of the Company which, in the opinion of management, contain all
adjustments, consisting only of normal, recurring adjustments, necessary to
present fairly the Company's results of operations and financial position for
such periods and at such dates. The consolidated results of operations for the
six- and three- month periods ended June 30, 1995 are not necessarily
indicative of the results to be expected for the full year or for future
periods. The selected financial data presented below should be read in
conjunction with the Consolidated Financial Statements of the Company and the
related notes thereto which are incorporated by reference into this Prospectus.
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
Years Ended December 31, June 30, June 30,
----------------------------------------- -------------------------- -------------------------
1992 1993 1994 1994 1995 1994 1995
----------- ----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Operating revenues . . . . . $ 692,981 $ 666,496 $ 616,331 $ 284,925 $ 293,160 $ 151,073 $ 161,367
Operating expenses
Transportation services(a)(b) 604,094 593,501 645,761 310,842 293,353 165,535 157,137
Depreciation and amortization 33,499 33,154 36,046 19,901 14,498 12,610 7,074
Interest expense . . . . . . 35,297 30,832 33,456 15,561 13,881 7,657 7,013
Income tax provision(b) . . . 9,142 6,253 16,862 17 28 10,656 26
Income (loss) before
extraordinary items and
cumulative effect of a
change in accounting
principle (b) . . . . . . . 10,949 8,594 (115,794) (61,396) (28,600) (45,385) (9,883)
Extraordinary items (c) . . . -- 407 (38,373) -- -- -- --
Cumulative effect of a change
in accounting principle (d) . -- 690 -- -- -- -- --
Net income (loss) . . . . . . $ 10,949 $ 7,497 $ (77,421) $ (61,396) $ (28,600) (45,385) (9,883)
Earnings per share of Common
Stock (e):
Primary
Income (loss) before
extraordinary items and
cumulative effect of a
change in accounting $ 1.10 $ 0.65 $ (7.58) $ (4.19) $ (0.54) $ (3.10) $ (0.18)
principle . . . . . . .
Extraordinary items . . . -- (0.03) 2.51 -- -- -- --
Cumulative effect of a
change in accounting
principle . . . . . . . -- (0.05) -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- ------------
Net income (loss) . . . . $ 1.10 $ 0.57 $ (5.07) $ (4.19) $ (0.54) $ (3.10) $ (0.18)
=========== =========== =========== ========== =========== =========== ===========
Fully diluted
Income (loss) before
extraordinary items and
cumulative effect of a
change in accounting
principle . . . . . . . $ 0.96 $ 0.65 $ (7.58) $ (4.19) $ (0.54) $ (3.10) $ (0.18)
Extraordinary items . . . -- (0.03) 2.51 -- -- -- --
Cumulative effect of a
change in accounting
principle . . . . . . . -- (0.05) -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------- ------------
Net income (loss) . . . . $ 0.96 $ 0.57 $ (5.07) $ (4.19) $ (0.54) $ (3.10) $ (0.18)
=========== =========== =========== ========== =========== =========== ===========
Weighted average number of
shares outstanding:(e)
Primary . . . . . . . . . 9,911,063 13,209,869 15,284,050 14,651,858 53,061,852 14,652,321 53,743,682
Fully diluted . . . . . . 15,666,343 13,209,869 15,284,050 14,651,858 53,061,852 14,652,321 53,743,682
</TABLE>
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<PAGE> 10
<TABLE>
<CAPTION>
Six Months Ended Three Months Ended
Years Ended December 31, June 30, June 30,
----------------------------------------- -------------------------- -------------------------
1992 1993 1994 1994 1995 1994 1995
----------- ----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF FINANCIAL POSITION
DATA (AT THE END OF PERIODS:)
Total assets . . . . . . . . $ 485,936 $ 541,293 $ 511,449 $ 501,857 $ 471,802 $ 501,857 $ 471,802
Long-term debt (f) . . . . . 290,712 260,412 197,125 270,591 186,863 270,591 186,863
Stockholders' equity (deficit) 52,262 152,166 153,196 90,783 124,671 90,783 124,671
OPERATING DATA:
Regular service miles operated
(millions) . . . . . . . . 242 235 236 110 117 58 63
Passenger miles (millions) . 5,967 5,926 5,392 2,478 2,567 1,355 1,422
Load factor (% of available
seats filled) . . . . . . . . 54.8 56.0 49.9 49.2 47.6 51.1 49.4
Yield (Revenue per passenger
mile) (cents) . . . . . . . . 9.73 9.45 9.61 9.57 9.59 9.32 9.61
Revenue per bus mile (dollars) 2.40 2.38 2.20 2.15 2.10 2.19 2.18
Passengers (millions) . . . . 16.2 15.4 16.0 7.3 7.7 3.8 4.1
Average Trip Length (miles) . 369 384 338 342 335 358 351
- ----------------------
</TABLE>
(a) Transportation services includes bus operating lease payments of $27.8
million, $20.0 million and $22.7 million for the years ended December 31,
1992, 1993 and 1994, respectively, $10.7 million and $11.4 million for the
six-month periods ended June 30, 1994 and 1995, respectively, and $5.7
million and $5.6 million for the three-month periods ended June 30, 1994
and 1995, respectively.
(b) The loss for the year ended December 31, 1994 and the six months and three
months ended June 30, 1994 reflected $61.9 million, $21.0 million and
$20.5 million, respectively, in certain operating charges, including
increases in insurance and legal reserves to recognize the pre-bankruptcy
claims previously barred by the bankruptcy court, adverse claims
development in 1994, and certain litigation exposure; write-downs of real
estate and other assets; costs associated with an operational
restructuring. The Company also recorded in the second quarter of 1994, a
$10.6 million income tax provision to reverse a deferred tax benefit
recognized in the first quarter of 1994. For the full year 1994, the
Company recorded a $17.0 million increase in the income tax provision
reversing a deferred tax benefit recognized in prior years.
(c) For the year ended December 31, 1994, the Company recorded an
extraordinary loss of $3.6 million related to the write-off of debt
issuance costs on the Company's previous credit agreement. The Company
also recorded an extraordinary gain of $41.9 million for the year ended
December 31, 1994, related to the conversion of $89.0 million principal
amount of 8.5% Convertible Debentures due 2007 (the "Convertible
Debentures") into Common Stock in December 1994. The Company recorded an
extraordinary loss of $407,000 for the year ended December 31, 1993, on
the write-off of debt issuance costs related to the replacement of the
Company's then existing credit agreement.
(d) The net impact from adoption of Statement of Financial Accounting
Standards No. 109 Accounting for Income Taxes was $690,000 and is reported
as a charge to earnings as the cumulative effect of a change in accounting
principle for the year ended December 31, 1993.
(e) The completion of the Company's financial restructuring plan pursuant to
which the Company converted approximately $89.0 million of Convertible
Debentures into Common Stock in December 1994 resulted in the issuance of
approximately 22.8 million shares of Common Stock. In January 1995, the
Company issued an additional 16.3 million shares of Common Stock in
connection with the consummation of a related rights offering.
(f) The Company's long-term debt was reduced by $89.0 million related to the
conversion of the Convertible Debentures into Common Stock.
9
<PAGE> 11
RISK FACTORS
Prospective purchasers of the Common Stock offered hereby should
carefully consider all of the information contained in this Prospectus
(including information incorporated by reference herein), especially the
considerations described or referred to in the following paragraphs.
RECENT LOSSES
The Company had an operating loss of $14.7 million for the six months
ended June 30, 1995, compared to an operating loss of $45.8 million for the
comparable 1994 period, and anticipates that it will have a net loss for the
year ending December 31, 1995. The decreased loss for the first half of 1995
resulted from a 2.9% increase in operating revenue and a 6.9% decrease in
operating expenses. However, there can be no assurance that these trends will
continue. Although the Company has implemented new strategic and operational
initiatives intended to enhance revenues, the Company's operations generally
are subject to financial, economic, legal and other factors, many of which are
beyond its control. Accordingly, there can be no assurance that the Company
will be able to implement these initiatives without delay or that these
initiatives will return the Company to profitability.
CAPITAL RESOURCES AND LIQUIDITY
The Company requires significant cash flows to meet its debt service
and other continuing obligations. Assuming that the Senior Note Repurchase had
been consummated using a portion of the proceeds of the Offering, at June 30,
1995 the Company would have had, on a pro forma basis, $182.4 million in
long-term debt outstanding (excluding $16.4 million of issued and undrawn
standby letters of credit), consisting primarily of the Senior Notes. After
giving effect to the Senior Note Repurchase, the Company will have semi-annual
interest payments (each January 31 and July 31) of $7.6 million due on the
Senior Notes.
The Senior Notes have sinking fund payments, initially in the amount
of $8.0 million and increasing annually thereafter, beginning in July 1996. The
Company intends to satisfy the 1996 sinking fund payment with the $1.7 million
of Senior Notes that the Company currently owns and Senior Notes acquired
through the Senior Note Repurchase. The Company intends to fund the Senior Note
Repurchase with the proceeds of the Offering and if necessary, borrowings
under the New Credit Agreement. After satisfying the 1996 sinking fund
requirement, the balance of the Senior Notes repurchased in the Senior Note
Repurchase will be used to satisfy a portion of the 1997 sinking fund payment
of $10.0 million, leaving $5.6 million to be satisfied from other Company
resources.
The Company's operations also require significant annual capital and
maintenance expenditures related to the Company's bus fleet, properties and
systems software. Approximately 32% of the Company's bus fleet is more than 10
years old. The Company's experience indicates that as the age of its fleet
increases, the dependability and quality of service declines, which may make
the Company less competitive. While the Company could continue to use these
older buses, the Company intends, over time, to replace these older, less
reliable vehicles with new buses. To replace these buses and to support the
planned increase in the size of the bus fleet, the Company expects to acquire
up to 300 new buses over the next 18 months at an aggregate cost of
approximately $70 to $80 million. See "Prospectus Summary -- Business
Strategy." Management believes that a delay in acquiring these new buses could
adversely affect future operations due to the higher operating costs associated
with operating older buses and the inability to implement fully the Company's
plans to increase total bus miles.
The Company's ability to finance these and other capital expenditures
and to meet its other financial obligations will depend on the Company's future
operating performance, which will be subject to financial, economic, legal and
other factors affecting the business and operations of the Company, many of
which are beyond its control. Although the New Credit Facility and cash flows
from operating activities will be sufficient to make a portion of the Company's
planned expenditures, the Company's operating strategy will depend on the
availability of additional sources of financing, such as operating and capital
lease financing or funds provided through sales of assets or sales of
securities. There can be no assurance that the Company will be able to obtain
financing on suitable terms for these purposes.
10
<PAGE> 12
LIENS ON ASSETS UNDER THE NEW CREDIT FACILITY
The New Credit Facility, which provides the Company with revolving
loans, letters of credit and letter of credit guarantees up to a maximum
commitment of $73.5 million, is secured by liens on substantially all of the
assets of the Company, excluding real estate purchases and new bus purchases,
unless those buses are specifically pledged to support increased borrowings
under the Bus Purchase Facility. See "Prospectus Summary - Recent Developments
- - New Credit Facility." The existence of the liens on the assets of the Company
under the New Credit Facility may impair the Company's ability to obtain
additional secured financing, other than purchase money financing, in the
future.
The New Credit Facility contains customary financial covenants and
events of default for an asset-based credit facility. While the Company is
currently in compliance with its financial covenants, an event of default
under the New Credit Facility could have a material adverse effect on the
Company. In addition, an event of default under the New Credit Facility may
constitute an event of default with respect to the Senior Notes and certain of
the Company's material leases for equipment and properties.
COMPETITION
The transportation industry is highly competitive. The Company's
primary sources of competition for passengers are low cost air travel from both
regional and national airlines, automobile travel and, in certain markets,
regional bus companies and Amtrak. Regional airlines are increasing their
penetration in intermediate-haul markets (400 to 1,000 miles), forcing the
Company and the bus industry generally to reduce prices in these markets in
order to compete. Additionally, airline discount programs attract long-haul
passengers from the Company. Because price is the primary method of meeting
airline competition, the Company has adopted everyday low pricing to respond to
these market changes.
Competition from regional bus companies has increased materially
during the past several years. Price, frequency of service and convenient
scheduling are the current strategies of the Company to meet this competition.
Regional bus companies currently service more routes in direct competition with
the Company than in the recent past. These competitors also possess operating
authority over numerous routes potentially competitive to the Company that they
do not currently operate. Based on market and competitive conditions, the
regional bus companies could operate such routes in the future. Competition by
U.S. based bus and van operators for Spanish speaking customers is growing,
particularly in states along the U.S.-Mexican border. The Company
also expects significant competition from Mexican bus carriers beginning in
1997 when barriers to entry into the cross border intercity bus market are
eliminated under the North American Free Trade Agreement.
SEASONALITY
The Company's business is seasonal in nature and generally follows the
pattern of the travel industry as a whole, with peaks during the summer months
and the Thanksgiving and Christmas holiday periods. Historically, the Company
has experienced substantial seasonal variances in cash flow.
IMPORTANCE OF SELF-INSURANCE AUTHORITY AND AVAILABILITY OF INSURANCE
The Interstate Commerce Commission (the "ICC") has granted the Company
authority to self-insure its automobile liability exposure for interstate
passenger service up to a maximum level of $5.0 million per occurrence. To
maintain self-insurance authority, the ICC requires the Company to maintain a
tangible net worth of $10.0 million (as of June 30, 1995, the Company's
tangible net worth was $104.9 million) and to maintain a $15.0 million trust
fund (currently fully funded) to provide security for payment of claims.
Subsequent to the ICC
11
<PAGE> 13
grant, thirty-eight states and the District of Columbia granted the Company the
authority to self-insure its intrastate automobile liability exposure.
The ICC maintains continuing oversight of the Company's self-insurance
authority, and the ability of the Company to continue as an authorized
self-insurer is dependent upon its future financial performance. If the ICC
were to revoke the Company's self-insurance authority or require substantial
additional contributions to the trust fund, such action would have a material
adverse effect on the Company's financial condition and results of operations.
LITIGATION
The Company is a party to various lawsuits the outcome of which, if
adverse to the Company, could have a material adverse effect on the results of
operations and financial position of the Company. See "Legal Proceedings" in
the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
1995.
ABSENCE OF DIVIDENDS ON COMMON STOCK
The Company has not paid any dividends on the Common Stock in the past
and does not anticipate paying dividends on the Common Stock in the foreseeable
future. Moreover, the Company's indenture governing the Senior Notes
restricts, and the New Credit Facility prohibits, the Company from declaring or
paying cash dividends on the Common Stock. See "Market Price of Common Stock
and Dividend Policy."
ANTITAKEOVER EFFECTS OF CERTAIN INSTRUMENTS AND AGREEMENTS OF THE COMPANY
The Company's certificate of incorporation and bylaws, the New Credit
Facility, the Senior Note Indenture, the Shareholder Rights Plan (as defined),
certain other contracts to which the Company is a party, and the Delaware
General Corporation Law contain provisions that could have the effect of
delaying or preventing a transaction that results in a change of control (as
defined) of the Company.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the 4,000,000 shares
of Common Stock being offered by the Company are estimated to be $16,016,875
million (based on the last reported sale price of the Common Stock on the
American Stock Exchange on August 29, 1995 of $4.3125 per share). The Company
intends to use $9.7 million of the net proceeds received by it to repurchase
$10.7 million aggregate principal amount of Senior Notes pursuant to a put/call
agreement in principle with one of the Company's principal stockholders. The
purchase price for the Senior Notes was based on arms-length negotiations. The
Company intends to satisfy the 1996 sinking fund payment with the $1.7 million
of Senior Notes that the Company currently owns and Senior Notes acquired
through the Senior Note Repurchase. The Company intends to fund the Senior
Note Repurchase with the proceeds of the Offering and if necessary, borrowings
under the New Credit Facility. After satisfying the 1996 sinking fund
requirement, the balance of the Senior Notes repurchased in the Senior Note
Repurchase will be used to satisfy a portion of the 1997 sinking fund payment
of $10.0 million, leaving $5.6 million to be satisfied from other Company
resources.
If there are any proceeds remaining after the Senior Note Repurchase the
Company will use such proceeds for general corporate purposes. Pending use,
the net proceeds to the Company from the Offering will be invested in
short-term, interest-bearing securities.
The Company will not receive any portion of the net proceeds from the
sale of the shares of Common Stock by the Selling Stockholder.
12
<PAGE> 14
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
June 30, 1995, and as adjusted to give effect to the sale of 4,000,000 shares
of Common Stock by the Company (based on the last reported sale price of the
Common Stock on the American Stock Exchange on August 29, 1995 of $4.3125 per
share) and the Senior Note Repurchase, as though those transactions had
occurred at June 30, 1995. The table below assumes that all the 4,000,000
shares of Common Stock offered by the Company will be sold. In the event less
than all such share are sold by the Company, the Company will first apply the
net proceeds of the shares sold by it to the Senior Note Repurchase. The
following information should be read in conjunction with the Consolidated
Financial Statements of Greyhound Lines, Inc. and Subsidiaries incorporated by
reference into this Prospectus.
<TABLE>
<CAPTION>
June 30, 1995
----------------------------------
As
Actual Adjusted
---------------- ----------------
(in thousands)
<S> <C> <C>
Long-term debt:
New Credit Facility (a) . . . . . . . . . . . . . . . . . . . . . $ 2,518 $ 2,518
Other secured indebtedness . . . . . . . . . . . . . . . . . . . 34,501 34,501
Senior Notes (b) . . . . . . . . . . . . . . . . . . . . . . . . 144,397 134,960
Convertible Debentures . . . . . . . . . . . . . . . . . . . . . 9,804 9,804
Other long-term debt . . . . . . . . . . . . . . . . . . . . . . 642 642
------------- ------------
Total long-term debt . . . . . . . . . . . . . . . . . . . 191,862 182,425
Less current maturities . . . . . . . . . . . . . . . . . . . . . 4,999 4,999
------------- ------------
Long-term debt, net (c) . . . . . . . . . . . . . . . . . . . . . 186,863 177,426
------------- ------------
Stockholders' equity:
Preferred stock (10,000,000 shares authorized; par value $.01,
none issued) Series A junior preferred stock (500,000 shares
authorized; par value $.01; none issued) . . . . . . . . . . . -- --
Common stock (100,000,000 shares authorized; par value $.01;
53,852,874 shares issued; 100,000,000 shares authorized, as
adjusted; par value $.01, as adjusted; 57,852,874 shares
issued, as adjusted (d)) . . . . . . . . . . . . . . . . . . . 538 578
Capital in excess of par value . . . . . . . . . . . . . . . . . 212,085 228,062
Retained deficit . . . . . . . . . . . . . . . . . . . . . . . . (85,415) (85,674)
Unfunded accumulated pension obligation . . . . . . . . . . . . . ( 1,499) ( 1,499)
Treasury stock, at cost (109,192 shares) . . . . . . . . . . . . ( 1,038) ( 1,038)
--------------- --------------
Total stockholders' equity . . . . . . . . . . . . . . . . 124,671 140,429
--------------- --------------
Total Capitalization . . . . . . . . . . . . . . . . . . . . . . . . $ 316,533 $ 322,854
=============== =============
</TABLE>
___________________________
(a) Does not reflect issued and undrawn letters of credit in the aggregate
amount of $16.4 million. As of August 30, 1995, the New Credit Facility
provides for revolving loans and letters of credit and/or letter of
credit guarantees of up to $65 million at any time outstanding.
(b) The Senior Notes are net of original issue discount of $18.9 million and
$17.7 million, as adjusted.
(c) In the event the Company sells less than approximately 2.6 million
shares in the Offering (based upon the last reported sales price of the
shares of Common Stock on August 29, 1995 of $4.3125 per share) the
Company will fund the Senior Note Repurchase with the net proceeds of
the offering, to the extent available, and then with
13
<PAGE> 15
borrowings under the New Credit Facility.
(d) Does not include 7,939,446 shares of Common Stock reserved for issuance
pursuant to the Company's stock option program (of which 5,122,536
shares were subject to outstanding options at June 30, 1995 with a
weighted average exercise price of $ 3.48), and 792,242 shares issuable
upon conversion of the Convertible Debentures at a conversion price of
$12.375 per share.
MARKET PRICE OF COMMON STOCK AND DIVIDEND POLICY
The Common Stock of the Company is listed on the American Stock
Exchange under the symbol BUS." The following table sets forth the high and
low sale prices for the Company's Common Stock during the periods indicated as
reported by the American Stock Exchange:
<TABLE>
<CAPTION>
High Low
---------------- -----------------
<S> <C> <C>
First Quarter 1993 . . . . . . . . . . . . . . . . . . . . . . . . . 18 1/2 10 7/8
Second Quarter 1993 . . . . . . . . . . . . . . . . . . . . . . . . . 22 3/4 16 3/4
Third Quarter 1993 . . . . . . . . . . . . . . . . . . . . . . . . . 22 11 1/8
Fourth Quarter 1993 . . . . . . . . . . . . . . . . . . . . . . . . . 15 3/8 11 1/8
First Quarter 1994 . . . . . . . . . . . . . . . . . . . . . . . . . 12 1/2 9 1/2
Second Quarter 1994 . . . . . . . . . . . . . . . . . . . . . . . . . 11 6 1/4
Third Quarter 1994 . . . . . . . . . . . . . . . . . . . . . . . . . 6 7/8 1 3/4
Fourth Quarter 1994 . . . . . . . . . . . . . . . . . . . . . . . . . 3 1 5/8
First Quarter 1995 . . . . . . . . . . . . . . . . . . . . . . . . . 2 3/4 1 1/4
Second Quarter 1995 . . . . . . . . . . . . . . . . . . . . . . . . . 5 11/16 2 5/16
Third Quarter to August 29, 1995 . . . . . . . . . . . . . . . . . . 5 5/16 3 1/2
</TABLE>
The Company has not paid any dividends on the Common Stock in the past
and does not expect to pay any dividends on the Common Stock in the foreseeable
future. The indenture governing the Senior Notes restricts the Company's
ability to pay, and the New Credit Facility prohibits the Company from paying,
cash dividends on the Common Stock. In the event the Company were not
contractually prohibited from paying dividends, the holders of Common Stock
would be entitled to receive dividends only when and as declared by the Board
of Directors of the Company, subject to the prior rights and preferences, if
any, of holders of preferred stock.
MANAGEMENT
During late 1994 and early 1995 the Company, in response to declines
in ridership and revenue, hired a new senior management team with significant
experience in both the bus industry specifically, and the transportation
industry in general. The Company's senior management team consists of the
following individuals.
Craig R. Lentzsch was elected to the Board of Directors on August 26,
1994. Effective November 15, 1994, Mr. Lentzsch became President and Chief
Executive Officer of the Company. Mr. Lentzsch previously served as Executive
Vice President and Chief Financial Officer of Motor Coach Industries
International, Inc. where he had been employed since 1992; as President and
Chief Executive Officer of Continental Asset Services, Inc. from 1991 to 1992;
as a private consultant to, and investor in, Storehouse, Inc. from 1983 to 1991
and Communications Partners, Ltd. from 1989 to 1991; as Vice Chairman,
Executive Vice President and a director of the Company from March 1987 to
December 1989; and as Co-founder and President of BusLease, Inc. from 1980 to
1989. Mr. Lentzsch also serves as a director of Hastings Books, Records and
Tapes and Enginetech, Inc.
14
<PAGE> 16
Jack W. Haugsland joined the Company on May 15, 1995 as Executive Vice
President and Chief Operating Officer. From 1992 to 1995 Mr. Haugsland was
President and Chief Executive Officer of Gray Line Worldwide. From 1991 to
1992 Mr. Haugsland held the position of Senior Vice President of Operations for
the Company; and from 1986 to 1990 Mr. Haugsland served as President of
Greyhound Travel Services, Inc., a former subsidiary of the Company. Mr.
Haugsland began employment with the Company's predecessor in 1964.
Steven L. Korby joined the Company as Executive Vice President and
Chief Financial Officer on April 13, 1995. Prior to joining the Company, Mr.
Korby was President of Armstrong Capital Corporation from 1994 to 1995 and
served as Executive Vice President, Chief Financial Officer and Chief
Technology Officer of Neodata Corporation and its predecessors from 1983 to
1993.
Bradley T. Harslem joined the Company in December 1993 and serves as
Senior Vice President - Information Services and Chief Information Officer. He
is responsible for all of the corporation's computer systems and for the
operation of the telephone sales centers. Prior to joining the Company, Mr.
Harslem worked for American Airlines, Inc. for eighteen years in various
engineering, finance, planning, marketing and technology roles. He served as
Vice President - Sabre Travel Information Network from 1991 to 1993; as Vice
President - Sabre Computer Services from 1988 to 1991 and as Managing Director
- - Marketing Administration from 1987 to 1988.
J. Floyd Holland has served as Senior Vice President - Operations
since September 1994 and is responsible for equipment maintenance, engineering,
driver and bus operations, scheduling and capacity planning. From October 1992
to September 1994, he served as Vice President - Maintenance of the Company.
From July 1987 to September 1992, he was Vice President - Fleet Operations and
was responsible for fleet allocations. From October 1979 to July 1987, Mr.
Holland served as Vice President of Operations and Transportation of Trailways.
From April 1984 to December 1991, Mr. Holland served as a director of Trailways
Commuter Transit, Inc., a former affiliate of the Company. Mr. Holland has
been a member of the Board of Directors and Executive Committee of the National
Bus Traffic Association since 1991.
Settlement of Legal Challenge to Appointment of Directors
On June 12, 1995, Chriss Street & Company, Inc. and James R. Moriarty,
former holders of Convertible Debentures, filed a lawsuit against the Company
and Messrs. Peck and Werlin, seeking to invalidate the appointment of Messrs.
Peck and Werlin to the Company's Board of Directors. On August 29, 1995 the
parties to that litigation entered into a settlement agreement of all claims
and the litigation was dismissed by the Delaware Chancery Court. Under the
settlement agreement, the challenge to the appointment of Messrs. Peck and
Werlin has been withdrawn and both shall remain on the Company's board.
15
<PAGE> 17
SELLING STOCKHOLDER
The following table sets forth the name of the Selling Stockholder,
the aggregate number of shares of Common Stock identified by the Selling
Stockholder as being beneficially owned by it as of August 29, 1995, and the
aggregate number of shares of Common Stock being sold by it in the Offering.
<TABLE>
<CAPTION>
Number of Number of Number of Percent of Common
shares of shares of shares of Stock Outstanding
Common Stock Common Stock Common Stock ------------------------
Name and Address of Owned Before to be Sold in to be Owned Before After
Beneficial Owner Offering Offering after Offering Offering Offering
------------------------------- --------------- -------------- -------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Motor Coach Industries Limited 6,004,144 6,004,144 0 11.2% 0%
1850 N. Central Avenue
Mail Station 910
Phoenix, Arizona 85004
</TABLE>
The Selling Stockholder acquired all of its shares of Common Stock in
January 1995 pursuant to a standby purchase agreement entered into in
connection with the Company's rights offering in December 1994. The Selling
Stockholder also is an affiliate of the Company's principal supplier of buses.
16
<PAGE> 18
PLAN OF DISTRIBUTION
The Company and the Selling Stockholder will enter into a Selling
Agency Agreement with Rothschild Inc. (the "Selling Agent"), a copy of which
will be filed with the Securities and Exchange Commission as an Exhibit to the
Registration Statement of which this Prospectus is a part.
Under the terms of the Selling Agency Agreement, the Company and the
Selling Stockholder have retained the Selling Agent, and the Selling Agent has
agreed to use its best efforts to obtain purchasers for the 10,004,144 shares
of the Company's Common Stock being offered by the Company and the Selling
Stockholder, at the purchase price set forth on the cover page of this
Prospectus. The Selling Agent has made no firm commitment and is under no
obligation to purchase or sell all or any part of the shares offered hereby,
but has agreed to use its best efforts to find purchasers for all of the
shares. In the event that less than all of the Common Stock offered hereby is
sold, the number of shares sold by the Company and the Selling Stockholder
shall be reduced pro rata. The Selling Agent may authorize certain other
members of the National Association of Securities Dealers, Inc. ("NASD") and
foreign members not eligible for membership in the NASD but who agree to abide
by the NASD's Rules of Fair Practice (the "Soliciting Dealers") to solicit
purchasers for the shares of Common Stock offered by this Prospectus. The
Company and the Selling Stockholder have agreed to pay the Selling Agent a
commission equal to $ per share ( % of the offering price), and the
Selling Agent will pay the Soliciting Dealers a concession equal to $ per
share sold by any Soliciting Dealer. It is expected that shares will be
offered by the Selling Agent and any Soliciting Dealers primarily to
institutional investors. The Company has also agreed to reimburse the Selling
Agent for its out of pocket expenses, including fees and disbursements of
counsel to the Selling Agent.
The Selling Agent Agreement provides that the obligations of the
Selling Agent are subject to certain conditions precedent and may be terminated
upon material adverse changes affecting the Company, outbreak or escalation of
war, hostilities or other emergencies or calamities, suspension or limitation
of trading on national securities exchanges, banking moratoria, changes in law,
and other market-related developments.
All payments for shares purchased pursuant to this Offering will be
made by the purchasers to the Selling Agent for the account of the Company and
the Selling Stockholder at the closing. Under the terms of the Selling Agency
Agreement, the offering will conclude 5 business days after the date of this
Prospectus (or earlier if all 10,004,144 shares are sold), subject to an
extension of up to 10 business days by agreement of the Company, the Selling
Stockholder and the Selling Agent.
The Selling Agency Agreement contains covenants of indemnity and
contribution among the Selling Agent, the Company, and the Selling Stockholder
against certain civil liabilities, including liabilities under the Securities
Act of 1933, as amended. The Selling Agent may be deemed to be an
"underwriter" within the meaning of the Securities Act of 1933, as amended.
The Company, its officers and directors, the Selling Stockholder, and
certain other holders who in the aggregate own approximately shares of
the Company's Common Stock have agreed not to offer, sell, or otherwise dispose
of any additional shares of Common Stock for a period of 120 days after the
date of this Prospectus (180 days in the case of the Company) without the prior
written consent of the Selling Agent, except that the Company may issue, and
grant options to purchase, shares of Common Stock under its existing stock
plans and the Company may issue shares of Common Stock upon the exercise of any
currently outstanding convertible securities.
The Selling Agent acted as the Company's financial advisor in
connection with its 1994 financial restructuring, including the tender offer
and conversion of the Convertible Debentures and the rights offering in which
an aggregate of 39.1 million shares of Common Stock were issued. The Selling
Agent also advised the Company on the structuring and negotiation of the credit
facility in October 1994 and the renegotiation and expansion of this facility
in June 1995.
17
<PAGE> 19
The Company has applied to the American Stock Exchange for approval of
the listing of the portion of the shares of Common Stock to be sold by it,
subject to official notice of issuance.
LEGAL MATTERS
Certain legal matters with respect to the Common Stock offered hereby
will be passed upon for the Company by Weil, Gotshal & Manges (a partnership
including professional corporations), Dallas, Texas. Certain legal matters in
connection with the sale of the Common Stock offered hereby will be passed upon
for the Selling Agent by Piper & Marbury L.L.P., New York, New York.
EXPERTS
The audited consolidated financial statements and schedules of
Greyhound Lines, Inc., incorporated by reference into this Prospectus and
elsewhere in the Registration Statement, to the extent and for the periods
indicated in their reports, have been audited by Arthur Andersen LLP,
independent public accountants, and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
reports.
18
<PAGE> 20
<TABLE>
<S> <C>
- ----------------------------------------------- -----------------------------------------------
- ----------------------------------------------- -----------------------------------------------
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS
BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATIONS NOT CONTAINED IN, OR
INCORPORATED BY REFERENCE IN, THIS PROSPECTUS,
IN CONNECTION WITH THE OFFERING COVERED BY
THIS PROSPECTUS. IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE 10,004,144 SHARES
COMPANY, THE SELLING STOCKHOLDER OR THE
SELLING AGENT. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, THE COMMON STOCK IN ANY
JURISDICTION WHERE, OR TO ANY PERSON TO WHOM,
IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS [LOGO]
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION
THAT THERE HAS NOT BEEN ANY CHANGE IN THE
FACTS SET FORTH IN THIS PROSPECTUS OR
INCORPORATED BY REFERENCE HEREIN OR IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. GREYHOUND LINES, INC.
COMMON STOCK
_____________________
P R O S P E C T U S
---------------------
---------------------------------
TABLE OF CONTENTS
PAGE ROTHSCHILD INC.
----
Available Information . . . . . . . . . . . 2
Incorporation of Certain Documents
by Reference . . . . . . . . . . . . . . 2
Prospectus Summary . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . . . . 10
Use of Proceeds . . . . . . . . . . . . . . 12
Capitalization . . . . . . . . . . . . . . 13
Market Price of Common Stock and
Dividend Policy . . . . . . . . . . . . 14
Management . . . . . . . . . . . . . . . . 14
Selling Stockholder . . . . . . . . . . . . 16
Plan of Distribution . . . . . . . . . . . 17
Legal Matters . . . . . . . . . . . . . . . 18
Experts . . . . . . . . . . . . . . . . . . 18 , 1995
- ----------------------------------------------- -----------------------------------------------
- ----------------------------------------------- -----------------------------------------------
</TABLE>
<PAGE> 21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the expenses payable in connection with
the offering of the securities to be registered and offered hereby. All of
such expenses are estimates, other than the registration fee payable to the
Securities and Exchange Commission.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee . . . . . . . . . . . . . . . . . . . . . $ 15,310
NASD Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,940
American Stock Exchange Additional Listing Fee . . . . . . . . . . . . . . . . . . . . . . .
Blue Sky Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Printing and Engraving Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounting Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
----------
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is incorporated in Delaware. Under Section 145 of the
General Corporation Law of the State of Delaware, a Delaware corporation has
the power, under specified circumstances, to indemnify its directors, officers,
employees and agents in connection with actions, suits or proceedings brought
against them by a third party or in the right of the corporation, by reason of
the fact that they were or are such directors, officers, employees or agents,
against expenses incurred in any such action, suit or proceeding. Article
Sixth of the Restated Certificate of Incorporation of the Company provides for
mandatory indemnification of directors and officers to the fullest extent
permitted by the General Corporation Law of the State of Delaware. Reference
is made to the Restated Certificate of Incorporation filed as exhibit 4.1
hereto.
Section 102(b)(7) of the General Corporation Law of the State of
Delaware provides that a certificate of incorporation may contain a provision
eliminating or limiting the personal liability of a director to the corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
director, provided that such provision shall not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 (relating to liability for unauthorized acquisitions or
redemptions of, or dividends on, capital stock) of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived an
improper personal benefit. Article Seventh of the Restated Certificate of
Incorporation of the Company provides that, to the fullest extent permitted by
the General Corporation Law of the State of Delaware, a director of the Company
shall not be liable to the Company or its stockholders for monetary damages for
breach of fiduciary duty as a director.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person
thereof in the successful defense of any action, suit or proceeding) is
asserted by a director, officer or controlling person in connection with the
securities being registered pursuant to this Registration Statement, the
Company will, unless in the opinion of counsel the matter has been settled by
II-1
<PAGE> 22
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
ITEM 16. EXHIBITS.
The following is a list of all exhibits filed as a part of this
Registration Statement.
1.1 -- Form of Selling Agency Agreement.(7)
4.1 -- Restated Certificate of Incorporation of Greyhound Lines,
Inc.(1)
4.2 -- Restated Bylaws of Greyhound Lines, Inc.(1)
4.3 -- Article Fourth of the Restated Certificate of Incorporation
of the Company relating to its capital stock.(2)
4.4 -- Certificate of Amendment to the Restated Certificate of
Incorporation of the Company amending Article Four thereof.(3)
4.5 -- Certificate of Amendment to the Restated Certificate of
Incorporation of the Company amending Article Eight thereof.(4)
4.6 -- Certificate of Designation of Series A Junior Preferred Stock of
the Company.(4)
5.1 -- Opinion of Weil, Gotshal & Manges.(5)
23.1 -- Consent of Weil, Gotshal & Manges. (included in Exhibit 5.1)
23.2 -- Consent of Arthur Andersen LLP.(6)
24.1 -- Power of Attorney.(7)
_________________________
(1) Incorporated by reference from the Registration Statement on Form S-1
(File Nos. 33-45060-01 and 33-45060-02) regarding the Company's 8 1/2%
Convertible Subordinated Debentures due 2007.
(2) Incorporated by reference from the Company's Registration Statement on
Form S-3 (File No. 33-61044).
(3) Incorporated by reference from the Company's Registration Statement on
Form S-8 (File No. 33-63506) regarding the Company's 1991 and 1993
Management Stock Option Plans.
(4) Incorporated by reference from the Company's Quarterly Report in Form
10-Q for the quarter ended June 30, 1994.
(5) To be filed by amendment.
(6) Filed herewith.
(7) Previously filed.
II-2
<PAGE> 23
ITEM 17. UNDERTAKINGS.
(a) See Item 15.
(b) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the Company pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of the Registration
Statement as of the time it was declared effective.
(c) For the purpose of determining any liabilities under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(d) For purposes of determining any liability under the Securities
Act of 1933, each filing of the Company's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-3
<PAGE> 24
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Dallas, State of Texas, on the 31st
day of August, 1995.
GREYHOUND LINES, INC.
By:
/s/ Steven L. Korby
----------------------------------------
Steven L. Korby
Executive Vice President, Chief Financial
Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Chairman of the Board and August 31, 1995
- --------------------------------------------------- Director
Thomas G. Plaskett
* Director, President and August 31, 1995
- --------------------------------------------------- Chief Executive Officer
Craig R. Lentzsch (Principal
Executive Officer)
/s/ Steven L. Korby Executive Vice President, August 31, 1995
- --------------------------------------------------- Chief Financial Officer and
Steven L. Korby Treasurer (Principal
Financial and Accounting
Officer)
* Director August 31, 1995
- ---------------------------------------------------
Richard J. Caley
* Director August 31, 1995
- ---------------------------------------------------
Alfred E. Osborne, Jr.
</TABLE>
<PAGE> 25
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Director August 31, 1995
- ---------------------------------------------------
Herbert Abramson
* Director August 31, 1995
- ---------------------------------------------------
Frank L. Nageotte
* Director August 31, 1995
- ---------------------------------------------------
Stephen M. Peck
* Director August 31, 1995
- ---------------------------------------------------
Ernest P. Werlin
*By: /s/ STEVEN L. KORBY August 31 , 1995
-------------------------------------------
Steven L. Korby
Attorney-in-Fact
</TABLE>
<PAGE> 26
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Pages
- ----------- ----------- --------------
<S> <C> <C>
1.1 -- Form of Selling Agency Agreement.(7)
4.1 -- Restated Certificate of Incorporation of Greyhound Lines,
Inc.(1)
4.2 -- Restated Bylaws of Greyhound Lines, Inc.(1)
4.3 -- Article Fourth of the Restated Certificate of Incorporation
of the Company relating to its capital stock.(2)
4.4 -- Certificate of Amendment to the Restated Certificate of
Incorporation of the Company amending Article Four thereof.(3)
4.5 -- Certificate of Amendment to the Restated Certificate of
Incorporation of the Company amending Article Eight thereof.(4)
4.6 -- Certificate of Designation of Series A Junior Preferred Stock of
the Company.(4)
5.1 -- Opinion of Weil, Gotshal & Manges.(5)
23.1 -- Consent of Weil, Gotshal & Manges. (included in Exhibit 5.1)
23.2 -- Consent of Arthur Andersen LLP.(6)
24.1 -- Power of Attorney.(7)
</TABLE>
_________________________
(1) Incorporated by reference from the Registration Statement on Form S-1
(File Nos. 33-45060-01 and 33-45060-02) regarding the Company's 8 1/2%
Convertible Subordinated Debentures due 2007.
(2) Incorporated by reference from the Company's Registration Statement on
Form S-3 (File No. 33-61044).
(3) Incorporated by reference from the Company's Registration Statement on
Form S-8 (File No. 33-63506) regarding the Company's 1991 and 1993
Management Stock Option Plans.
(4) Incorporated by reference from the Company's Quarterly Report in Form
10-Q for the quarter ended June 30, 1994.
(5) To be filed by amendment.
(6) Filed herewith.
(7) Previously filed.
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 14,
1995, except with respect to the matters discussed in Note 20, as to which the
date is March 30, 1995, included in Greyhound Lines, Inc.'s Form 10-K for the
year ended December 31, 1994, and to all references to our Firm included in
this registration statement.
ARTHUR ANDERSEN LLP
Dallas, Texas
August 30, 1995
